Q1 2026 Erdene Resource Development Corp Earnings Call

May 7, 2026

Operator: Thank you for standing by. This is the conference operator. Welcome to the Erdene Resource Development Q1 2026 Financial and Operating Results Conference Call and Webcast. As a reminder, all participants on the telephone are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star, then 1 on your telephone keypad. Should you need assistance during the call, you may signal the operator by pressing star then 0. Participants on the webcast may type in their questions in the Q&A box on the right of the slides. Now let me turn the call over to John Vicsek.

John Vincic: Thank you, operator. Hello, everyone. Thank you for joining our call today. Before we begin, some housekeeping items to note. The accompanying presentation for today's call is available for download from the company's website at www.erdene.com. Yesterday's press release, the financial statements, and the MD&A are all posted on Erdene's website and SEDAR+. I'll point out that management's remarks on the Bayan Khundii Gold Mine's operating performance in Q1 2026 are at the Erdene Mongol level, a 50/50 joint venture between Erdene and Mongolian Mining Corporation. It's also important to note that this conference call contains forward-looking information that is based on the company's current expectations, estimates, and beliefs, and may also use terms that are non-IFRS performance measures.

John Vincic: Please review Erdene's latest disclosure materials, including the company's most recent annual information form for the risks associated with its forward-looking information and the use of non-IFRS performance measures. Please note that all dollar amounts mentioned on today's call are in Canadian dollars unless otherwise noted. Today's speakers from Erdene are Peter Akerley, President and Chief Executive Officer, and Robert Jenkins, Chief Financial Officer. Please go ahead, Peter.

Peter Akerley: Thanks, John, and hello, everyone. Our company is an emerging gold producer focused on establishing Bayan Khundii as one of the highest grade open pit gold mines globally, while continuing to grow through the exploration and development of our other precious and industrial metal deposits in the Khundii Minerals District. With our track record as one of the most successful explorers in Mongolia over the past 20 years, we are excited about the value we can deliver in the district. We will also continue to be active on other opportunities in prospective regions of the country, like the Tereg Uul copper-gold prospect in the Oyu Tolgoi district, where drilling began last week. Let me now share with you details on our operating results for Q1 2026, as well as more on our growth opportunities. Please turn your attention to slide 4.

Peter C. Akerley: Thanks, John, and hello, everyone. Our company is an emerging gold producer focused on establishing Bayan Khundii as one of the highest grade open pit gold mines globally, while continuing to grow through the exploration and development of our other precious and industrial metal deposits in the Khundii Minerals District. With our track record as one of the most successful explorers in Mongolia over the past 20 years, we are excited about the value we can deliver in the district. We will also continue to be active on other opportunities in prospective regions of the country, like the Tereg Uul copper-gold prospect in the Oyu Tolgoi district, where drilling began last week. Let me now share with you details on our operating results for Q1 2026, as well as more on our growth opportunities. Please turn your attention to slide 4.

Peter Akerley: During the quarter, the Bayan Khundii process plant achieved average throughput of 94% of nameplate capacity and average gold recovery rates of 96% higher than our anticipated recoveries in our feasibility study. With this performance, we are very proud to announce that we reached the milestone of commercial production during Q1 2026, less than 6 months after commissioning the plant. While we continue to focus on optimizing operations at the Bayan Khundii mine, our exploration team is working on multiple opportunities to extend Bayan Khundii's mine life and support plant expansion, targeting areas adjacent to the mine. At the Dark Horse deposit, just 2.5 km north of the Bayan Khundii open pit, we expanded high-grade mineralization and identified a 3 km trend of targets through recent drilling with results announced in late Q1.

Peter C. Akerley: During the quarter, the Bayan Khundii process plant achieved average throughput of 94% of nameplate capacity and average gold recovery rates of 96% higher than our anticipated recoveries in our feasibility study. With this performance, we are very proud to announce that we reached the milestone of commercial production during Q1 2026, less than 6 months after commissioning the plant. While we continue to focus on optimizing operations at the Bayan Khundii mine, our exploration team is working on multiple opportunities to extend Bayan Khundii's mine life and support plant expansion, targeting areas adjacent to the mine. At the Dark Horse deposit, just 2.5 km north of the Bayan Khundii open pit, we expanded high-grade mineralization and identified a 3 km trend of targets through recent drilling with results announced in late Q1.

With this performance. We are very proud to announce that we reached the Milestone of commercial production during the quarter of 2020, the first quarter of 2026, less than 6 months, after commissioning the plant.

While we continue to focus on optimizing operations at the buying Hyundai mine. Our expiration team is working on multiple opportunities to extend by, in Hyundai's, mine, life and support, plant expansion targeting areas adjacent to the mine.

Peter Akerley: We see further opportunities just west of the pit at Striker West and Ulaan, which will be advanced over the coming months. Over the medium term, we see the opportunity to significantly increase gold production by bringing the Altan Nar Gold project, owned by Erdene Mongol, online. At our wholly-owned Zuun Mod project, we recently announced results from drilling that included multiple ore grade molybdenum-copper intersections, which will be incorporated into a preliminary economic assessment on track for completion in Q3 2026. Zuun Mod, one of Asia's largest undeveloped molybdenum-copper deposits, is just 200 km from China, the world's largest consumer of both critical metals.

Peter C. Akerley: We see further opportunities just west of the pit at Striker West and Ulaan, which will be advanced over the coming months. Over the medium term, we see the opportunity to significantly increase gold production by bringing the Altan Nar Gold project, owned by Erdene Mongol, online. At our wholly-owned Zuun Mod project, we recently announced results from drilling that included multiple ore grade molybdenum-copper intersections, which will be incorporated into a preliminary economic assessment on track for completion in Q3 2026. Zuun Mod, one of Asia's largest undeveloped molybdenum-copper deposits, is just 200 km from China, the world's largest consumer of both critical metals.

At the Dark Horse deposit, just 2 and a half kilometers. North of the bay and Hyundai open. Pit we expanded high-grade mineralization and identified a 3. Km trend of targets through recent drilling with results announced in late q1.

We see further opportunities, just west of the pit at Stryker, West and nulan, which will be Advanced over the coming months.

Over the medium term, we see the opportunity to significantly increase gold production by bringing the altar. In our gold project owned by erdan Mongol online.

And at our wholly owned Zoom Mod project, we recently announced results from drilling that included multiple ore grade, milligen, and copper intersections, which will be incorporated into a preliminary economic assessment on track for completion in Q3 2026.

Peter Akerley: This deposit, exposed at surface, is hosted within a much larger copper porphyry system, a part of the system is the high-grade copper discovery at Khuvynkhar, 4.5 km northwest of the molybdenum deposit, which is scheduled for further exploration in H2. Beyond the Khundii Minerals District, last week, we kicked off the maiden drill program at Tereg Uul, a project just 10 km from the giant Oyu Tolgoi copper-gold mine, which is on track to be the 4th largest globally by the end of the decade. Results for Tereg Uul will be delivered in early Q3. Now, let's dig into some of the details on the performance of Bayan Khundii over the past few months.

Peter C. Akerley: This deposit, exposed at surface, is hosted within a much larger copper porphyry system, a part of the system is the high-grade copper discovery at Khuvynkhar, 4.5 km northwest of the molybdenum deposit, which is scheduled for further exploration in H2. Beyond the Khundii Minerals District, last week, we kicked off the maiden drill program at Tereg Uul, a project just 10 km from the giant Oyu Tolgoi copper-gold mine, which is on track to be the 4th largest globally by the end of the decade. Results for Tereg Uul will be delivered in early Q3. Now, let's dig into some of the details on the performance of Bayan Khundii over the past few months.

Zoom mod 1 of Asia's largest on developed malignum. Copper deposits is just 200 kilometers from China. The world's largest consumer of both critical metals,

Part of the system is the high-grade copper Discovery at hooven, higher 4, and a half kilometers Northwest of the mullet deposit which is scheduled for further expiration in the second half of the year.

Beyond the Hyundai minerals District. Last week, we kicked off the maiden drill program at Terra ghoul. A project just 10 kilometers from the giant oy copper Gold Mine, which is on track. To be the fourth largest globally. By the end of the decade results, for Terra will be delivered in early Q3.

Peter Akerley: As shown on slide 5, the Erdene Mongol processing team fed 151,000 tons of ore at an average grade of 1.9 grams per ton into the plant in Q1, averaging 1,675 tons per day or 94% of the plant's target throughput. Gold recoveries averaged 96% in Q1, well above the target of the 93% reported in the feasibility study. With throughput and recoveries averaging over 90% during the quarter, we are very pleased to have reached commercial production status. Erdene Mongol sold over 8,500 ounces of gold and over 3,100 ounces of silver in Q1, 15% and 19% respectively more ounces than in Q4 2025. This brings us to total gold production of almost 16,000 ounces since we commissioned the mine in September 2025.

Peter C. Akerley: As shown on slide 5, the Erdene Mongol processing team fed 151,000 tons of ore at an average grade of 1.9 grams per ton into the plant in Q1, averaging 1,675 tons per day or 94% of the plant's target throughput. Gold recoveries averaged 96% in Q1, well above the target of the 93% reported in the feasibility study. With throughput and recoveries averaging over 90% during the quarter, we are very pleased to have reached commercial production status. Erdene Mongol sold over 8,500 ounces of gold and over 3,100 ounces of silver in Q1, 15% and 19% respectively more ounces than in Q4 2025. This brings us to total gold production of almost 16,000 ounces since we commissioned the mine in September 2025.

Now, let's dig into some of the details on the performance of buying Hyundai over the past few months as shown on slide. 5 the year in Mongo processing, team fed 151,000. Tons of ore at an average grade of 1.9 grams per tonne into the plant in q1 averaging 1,675 tons per day or 94% of the plant's Target. Throughput gold recovery is average. 96% in q1. Well, above the target of the 93% reported in the feasibility study.

With throughput and Recovery is averaging over 90% during the quarter. We are very pleased to have reached commercial production status.

burden Mongols sold over 8,500, oz of gold and over 3,100 oz of silver and q1, 15% and 19% respectively, more Oz than in Q4 2025

Peter Akerley: Realized prices in Q1 for gold and silver were $48.70 and $80 per ounce, respectively. Erdene Mongol generated $42 million in revenue, 35% higher than Q4 2025. Overall, the process plant is operating extremely well, with throughput and recoveries exceeding expectations, generating positive cash flows in the strong gold and silver price environment. Turning to slide 6. During January and February, we saw reduced mining rates and stockpiled and fed lower grade ore to the plant as our team continued to increase their understanding of the deposit and establish a single working level. As you can see on this slide, we are operating in a very tight space with mining, grade control, drilling, and blasting within the Midfield, Striker, and Gold Hill zones, all within 250 meters of each other, as we're in the initial phases of mining.

Peter C. Akerley: Realized prices in Q1 for gold and silver were $48.70 and $80 per ounce, respectively. Erdene Mongol generated $42 million in revenue, 35% higher than Q4 2025. Overall, the process plant is operating extremely well, with throughput and recoveries exceeding expectations, generating positive cash flows in the strong gold and silver price environment. Turning to slide 6. During January and February, we saw reduced mining rates and stockpiled and fed lower grade ore to the plant as our team continued to increase their understanding of the deposit and establish a single working level. As you can see on this slide, we are operating in a very tight space with mining, grade control, drilling, and blasting within the Midfield, Striker, and Gold Hill zones, all within 250 meters of each other, as we're in the initial phases of mining.

This brings us to Total gold production of almost 16,000 oz since we commissioned the mine in September of 2025.

Realized prices in q1 for gold and silver were 4870 us and eighty dollars per ounce respectively.

Burden Mongol generated 42 million US dollars in Revenue, 35% higher than Q4 2025.

And overall, the process plan is operating extremely well with throughput and recoveries exceeding, expectations generating, positive cash flows in the strong gold and silver price environment.

Turning to slide 6 during January and February, we saw reduced mining rates and stockpiled and fed lower grade or to the plant. As our team continued to increase their understanding of the deposit and establish a single working level.

Peter Akerley: These challenges are gradually being overcome with training, expert participation, and through pit expansion. Another challenge we've been addressing is blast fragmentation, which left approximately 15% of ore stockpiled as it was oversized for the plant's crusher. This oversized material is more siliceous and therefore is expected to be higher grade. In late Q1, a mobile crusher was added to handle this ore. Improvement in feed grades coincided with the addition of the crushing unit. In addition, consultants have recently been on site advising on blasting improvements, which are being observed in the mine. Introducing more experienced geologists into the pit has also paid dividends. As a result, in Q1, the mining team generated 155,000 tons of ore at an average grade of 1.5 grams per ton, with a significant improvement in grade later in the quarter.

Peter C. Akerley: These challenges are gradually being overcome with training, expert participation, and through pit expansion. Another challenge we've been addressing is blast fragmentation, which left approximately 15% of ore stockpiled as it was oversized for the plant's crusher. This oversized material is more siliceous and therefore is expected to be higher grade. In late Q1, a mobile crusher was added to handle this ore. Improvement in feed grades coincided with the addition of the crushing unit. In addition, consultants have recently been on site advising on blasting improvements, which are being observed in the mine. Introducing more experienced geologists into the pit has also paid dividends. As a result, in Q1, the mining team generated 155,000 tons of ore at an average grade of 1.5 grams per ton, with a significant improvement in grade later in the quarter.

As you can see on this slide, we are operating in a very tight space with mining. Great control Drilling and Blasting within the Midfield Striker and gold Hills zones all within 250 M of each other as we're in the initial phases of mining.

These challenges are gradually being overcome with training expert, participation and through pit expansion.

Another challenge, we've been addressing is blast fragmentation, which left approximately 15% of our stockpiled, as it was oversized for the plant's Crusher.

This oversized material is more siliceous and therefore is expected to be higher grade.

In Lake, q1. A mobile Crusher was added to handle this. Orb.

Improvement in feed grades coincided with the addition of the crushing unit.

In addition, consultants have recently been on site, advising on blasting improvements, which are being observed in the mine. Introducing more experienced geologists into the pit has also paid dividends.

Peter Akerley: Feed grades averaged 2.7 grams per ton in March, with 3 grams per ton or higher over the past few weeks of the month, as seen on the graph on this slide. The focus for the remainder of Q2 is to consistently deliver these higher grades to the Bayan Khundii plant by continuing to pre-crush oversized ore and build our team's selective mining abilities with additional team members and expert training to reduce dilution and improve blasting performance. Although we witnessed some weather-related factors due to the spring thaw impacting productivity in early April, overall, these initiatives, along with access to additional high-grade zones, has recently seen us achieve closer to our target feed grade. While our immediate priority is to consistently deliver high-grade feed to the Bayan Khundii plant, our second objective is to grow operations.

Peter C. Akerley: Feed grades averaged 2.7 grams per ton in March, with 3 grams per ton or higher over the past few weeks of the month, as seen on the graph on this slide. The focus for the remainder of Q2 is to consistently deliver these higher grades to the Bayan Khundii plant by continuing to pre-crush oversized ore and build our team's selective mining abilities with additional team members and expert training to reduce dilution and improve blasting performance. Although we witnessed some weather-related factors due to the spring thaw impacting productivity in early April, overall, these initiatives, along with access to additional high-grade zones, has recently seen us achieve closer to our target feed grade. While our immediate priority is to consistently deliver high-grade feed to the Bayan Khundii plant, our second objective is to grow operations.

As a result in q1, the mining team generated 155,000. Tons of ore at an average grade of 1.5 grams per ton with a significant Improvement in grade later in the quarter.

Feed grades, averaged 2.7 grams per ton in March with 3 grams per ton or higher over the past few weeks of the month, as seen on the graph on this Slide, the focus for the remainder of Q2 is to consistently deliver these higher grades to the buying Hyundai plant by continuing to pre Crush oversized door and build our team. Selective mining abilities with additional team members and expert training, to reduce dilution and improve blasting performance.

although we witnessed some weather related factors due to the spring thaw, impacting productivity, in the early April, overall these initiatives along with access to additional high-grade zones as recently as seen as achieved closer to our Target feed rate,

Peter Akerley: As seen on slide 7, our immediate focus are on two areas adjacent to the Bayan Khundii mine, Dark Horse and Bayan Khundii West, where we see substantial potential to grow gold resources and thereby extend the life and possibly expand the production capacity of the Bayan Khundii complex, as I'll describe in more detail on the following slides. As shown on slide 8, Dark Horse, two and a half km north of Bayan Khundii, currently hosts the planned 50,000 ounce high-grade gold pit, characterized by an oxide zone exposed at surface. In Q2, we will begin grade control drilling to establish detailed plans for mining in H2 of 2027. This deposit lies within a 3km mineralized trend, where exploration reported as part of a year-end report in late March highlighted several growth opportunities.

Peter C. Akerley: As seen on slide 7, our immediate focus are on two areas adjacent to the Bayan Khundii mine, Dark Horse and Bayan Khundii West, where we see substantial potential to grow gold resources and thereby extend the life and possibly expand the production capacity of the Bayan Khundii complex, as I'll describe in more detail on the following slides. As shown on slide 8, Dark Horse, two and a half km north of Bayan Khundii, currently hosts the planned 50,000 ounce high-grade gold pit, characterized by an oxide zone exposed at surface. In Q2, we will begin grade control drilling to establish detailed plans for mining in H2 of 2027. This deposit lies within a 3km mineralized trend, where exploration reported as part of a year-end report in late March highlighted several growth opportunities.

while our immediate priority is to consistently deliver high-grade fee to the buying Hyundai plant, our second objective is to grow operations.

As seen on slide 7, our immediate Focus are on 2 areas adjacent to the buying Hyundai, mine Dark Horse and buying Hyundai West where we see substantial potential to grow gold resources and thereby extend the life.

and possibly expand the production capacity of the buying Hyundai complex as I'll describe in more detail on the following slides,

To establish detailed plans for mining in the second half of 2027.

Peter Akerley: At Dark Horse South, highlights adjacent to the currently planned pit included very high grade near surface intercepts, 9.6 grams per ton over 19m and 28.7 grams per ton over 3m in areas expanding the limits of the resource. At Dark Horse North, 500m north of the planned pit, we intersected multiple zones of gold mineralization within oxide and transition zones, including 43m of 1.9g and 16m of 1.4g. This area, 700m in strike length with oxide material extending up to 100m depth, provides lower grade ore, which is being considered for an eventual heap leach opportunity to complement the Bayan Khundii carbon and pulp plant.

Peter C. Akerley: At Dark Horse South, highlights adjacent to the currently planned pit included very high grade near surface intercepts, 9.6 grams per ton over 19m and 28.7 grams per ton over 3m in areas expanding the limits of the resource. At Dark Horse North, 500m north of the planned pit, we intersected multiple zones of gold mineralization within oxide and transition zones, including 43m of 1.9g and 16m of 1.4g. This area, 700m in strike length with oxide material extending up to 100m depth, provides lower grade ore, which is being considered for an eventual heap leach opportunity to complement the Bayan Khundii carbon and pulp plant.

However this deposit lies within a 3 kilometer mineralized Trend, where expiration reported as part of a year-end uh report in late March highlighted several growth opportunities.

A Dark Horse South.

Highlights adjacent to the currently planned. Pit included very high-grade near surface. Intercepts 9.6 G per ton over 19 M and 28.7 G per ton over 3 m in areas expanding the limits of the resource.

A dark horse North 500 M. North of the plant pit. We intersected multiple zones of gold mineralization within oxide and transition zones, including 43, M, or 1.9 grams, and 16 M of 1.4

Peter Akerley: Composites from Dark Horse are currently the subject of heap leach amenability testing at Blue Coast Research in British Columbia, Canada, with results expected in mid 2026. Although Dark Horse North is the current focus for the heap leach, we are assessing various sources from the Khundii gold deposits and prospects that could form a base for supporting that facility, including Altan Nar to the northeast. The mineralized structure at Altan Nar has been traced over 1.7 km. Although at an earlier stage of exploration, results in this oxidized zone are very encouraging, including recent drill results of up to 16 m of 1.36 g/t. Also a silver zone where we had 5 m of 66 g/t silver in the near surface.

Peter C. Akerley: Composites from Dark Horse are currently the subject of heap leach amenability testing at Blue Coast Research in British Columbia, Canada, with results expected in mid 2026. Although Dark Horse North is the current focus for the heap leach, we are assessing various sources from the Khundii gold deposits and prospects that could form a base for supporting that facility, including Altan Nar to the northeast. The mineralized structure at Altan Nar has been traced over 1.7 km. Although at an earlier stage of exploration, results in this oxidized zone are very encouraging, including recent drill results of up to 16 m of 1.36 g/t. Also a silver zone where we had 5 m of 66 g/t silver in the near surface.

This area. 700 M, in strike length with oxide material, extending up to 100 m depth provides lower grade or which is being considered for an eventual. Heap bleach opportunity to compliment the buying Hyundai carbon and Pulp plant

Composites from Darkhorse are currently the subject of Heap bleach and ability testing at Blue Coast research in British Columbia Canada with results. Expected in mid 2026,

Peter Akerley: Overall, the Dark Horse drill program improved the scale of the resource opportunities at Dark Horse South and North, and importantly, reinforced the presence of anomalous gold targets along at least 3km of trend, with several adjacent targets remaining untested. We anticipate commencing another expansionary drill program in Q3 following the infill program in Q2. As seen on slide 9, there is a substantial opportunity to expand the Bayan Khundii pit to the west. Just a reminder that that initial pit was developed at a CAD 1,850 gold price. Work is now underway to incorporate resources from Khundii West into an expanded pit, supported by recent drilling and the impact of the higher gold prices. Mineralization of Bayan Khundii continues onto the Ulaan license, which has been traced to up to 400 meters depth.

Peter C. Akerley: Overall, the Dark Horse drill program improved the scale of the resource opportunities at Dark Horse South and North, and importantly, reinforced the presence of anomalous gold targets along at least 3km of trend, with several adjacent targets remaining untested. We anticipate commencing another expansionary drill program in Q3 following the infill program in Q2. As seen on slide 9, there is a substantial opportunity to expand the Bayan Khundii pit to the west. Just a reminder that that initial pit was developed at a CAD 1,850 gold price. Work is now underway to incorporate resources from Khundii West into an expanded pit, supported by recent drilling and the impact of the higher gold prices. Mineralization of Bayan Khundii continues onto the Ulaan license, which has been traced to up to 400 meters depth.

Although dark was North is the current Focus for the heat bleach. We are assessing various sources from the Hyundai gold deposits and Prospects that could form a base for supporting that facility, including Alton arrow to the Northeast. The mineralized structure at Alton Arrow has been traced, over 1.7 km and although at an earlier stage of expiration results in this oxidized zone are very encouraging, including recent drill results of up to 16 metres of 1.36 grams per tonne and also a silver Zone where we had 5 metres of 666 grams per tonne silver in the near surface.

Overall, the Darkhorse drill program improved. The scale of the resource opportunities, that Darkhorse, south and north. And importantly, reinforced, the presence of anomalous gold targets along at least 3 km of trend with several adjacent targets. Remaining on tested. We anticipate commencing another expansionary drill program in Q3 following the infill programming Q2.

As seen on slide 9, there is a substantial opportunity to expand the buy and Hyundai pit to the West.

Just a reminder that that initial pit was developed at an 1850 gold price.

Work is now underway to incorporate resources, from Striker West into an expanded pit supported by recent Drilling and the impact of the higher gold prices.

Peter Akerley: Within these thick intervals of gold mineralization are very high-grade feeder zones, as you can see in the tables at the top of slide 9. An updated Bayan Khundii mine plan is expected to be completed later in 2026, with a first sign of that expansion potential to the west. Lying between Erdene Mongol's Bayan Khundii and Ulaan license is the Khuren Tsav license, held by Erdenes Tavan Tolgoi, a Mongolian state-owned company. Longer term, there could be an opportunity to create a super pit to collaboratively mine the ore in this deposit across the area from Bayan Khundii through to Ulaan. We have established a cornerstone reserve at Bayan Khundii and Dark Horse to support the initial mining period and the related infrastructure to support an extension and expansion of the Bayan Khundii complex.

Peter C. Akerley: Within these thick intervals of gold mineralization are very high-grade feeder zones, as you can see in the tables at the top of slide 9. An updated Bayan Khundii mine plan is expected to be completed later in 2026, with a first sign of that expansion potential to the west. Lying between Erdene Mongol's Bayan Khundii and Ulaan license is the Khuren Tsav license, held by Erdenes Tavan Tolgoi, a Mongolian state-owned company. Longer term, there could be an opportunity to create a super pit to collaboratively mine the ore in this deposit across the area from Bayan Khundii through to Ulaan. We have established a cornerstone reserve at Bayan Khundii and Dark Horse to support the initial mining period and the related infrastructure to support an extension and expansion of the Bayan Khundii complex.

Mineralization of buying Hyundai continues onto the Ulan license, which has been traced to up to 400 meters depth.

Within these thick intervals of gold mineralization are very high-grade feeder zones. As you can see in the tables at the top of slide 9,

An updated by an Hyundai. Mine plan is expected to be completed later in 2026 with the first sign of the that that expansion potential to the West.

Lying between Erdene, Mongols, Bay, and Hyundai. And Ulan. License is the HER and S.O.B. license. How by Ernest, alt among a Mongolian state-owned company.

Longer term, there could be an opportunity to create a super pit to collaboratively mine. The ore in this deposit across the area from buying Hyundai, through to Alan.

Peter Akerley: The Bayan Khundii epithermal system has been traced for over 10 km of interconnected structures and is still in the early days of exploration. We are very excited about the potential it offers. As seen on slide 10, I'd also like to remind everyone of the potential and plans for the Altan Nar deposit held by Erdene Mongol just 16 km north of Bayan Khundii. This area hosts a 5 km-long mineralized trend where we've defined more than a half a million ounces of gold resources as well as by-product silver, lead, and zinc. This intentionally mineralized gold and silver system has received almost no recent exploration given the focus at Bayan Khundii and remains open along strike and at depth. The system is geologically different from Bayan Khundii, defined as a gold polymetallic intermediate sulfidation deposit with similarities to Barrick's Porgera and Lundin's Fruta del Norte.

Peter C. Akerley: The Bayan Khundii epithermal system has been traced for over 10 km of interconnected structures and is still in the early days of exploration. We are very excited about the potential it offers. As seen on slide 10, I'd also like to remind everyone of the potential and plans for the Altan Nar deposit held by Erdene Mongol just 16 km north of Bayan Khundii. This area hosts a 5 km-long mineralized trend where we've defined more than a half a million ounces of gold resources as well as by-product silver, lead, and zinc. This intentionally mineralized gold and silver system has received almost no recent exploration given the focus at Bayan Khundii and remains open along strike and at depth. The system is geologically different from Bayan Khundii, defined as a gold polymetallic intermediate sulfidation deposit with similarities to Barrick's Porgera and Lundin's Fruta del Norte.

We have established a Cornerstone Reserve at Bay and Hyundai and Darkhorse to support the initial mining period. And the related infrastructure to support an extension and expansion of the buying Hyundai complex. The buying Hyundai Epi thermal system has been traced for over 10 kilometers of interconnected structures and is still in the early days of expiration. We are very excited about the potential it offers.

As seen on slide 10, I'd also like to remind everyone of the potential and plans for the Altan Nar deposit. Held by Erdene Mongol, just 16 kilometers north of Bayan Khundii,

This area hosts a 5-kilometer-long mineralized trend where we've defined more than half a million ounces of gold resources, as well as byproduct silver, lead, and zinc.

This intentionally mineralized gold and silver system has received almost no, recent expiration. Given the focus of buying Hyundai and remains open a long strike and at depth.

Peter Akerley: These deposits can be vertically extensive relative to low sulfidation systems like Bayan Khundii and are often spatially related to porphyry copper deposits with high potential copper targets identified on the Altan Nar license. Altan Nar provides a significant exploration opportunity to expand existing resources and the optionality to develop a deposit to feed high grade into the Bayan Khundii complex, both the CIP and possibly heap leach, but also offers the opportunity for a standalone producer of flotation concentrate. All options are currently being assessed with resource expansion drilling along with further metallurgical testing to provide the basis for a feasibility study by late 2027.

Peter C. Akerley: These deposits can be vertically extensive relative to low sulfidation systems like Bayan Khundii and are often spatially related to porphyry copper deposits with high potential copper targets identified on the Altan Nar license. Altan Nar provides a significant exploration opportunity to expand existing resources and the optionality to develop a deposit to feed high grade into the Bayan Khundii complex, both the CIP and possibly heap leach, but also offers the opportunity for a standalone producer of flotation concentrate. All options are currently being assessed with resource expansion drilling along with further metallurgical testing to provide the basis for a feasibility study by late 2027.

The system is geologically different from by anandi defined as a gold poly metallic intermediate sulfidation deposit with similarities to barracks porgera and lundeens fruit to Del Norte. These deposits can be vertically, vertically extensive relative to low sulfidation systems like Bay and Hyundai, and are often spatially related to poor for copper deposits with high potential copper targets identified on the Alton Nar license.

But also had offers the opportunity for a standalone producer of flotation concentrate.

All options are currently being assessed with resource expansion drilling along with further metallurgical, testing to provide the basis for a feasibility study by late 2027.

Peter Akerley: The gold-focused exploration opportunities in the Bayan Khundii and Altan Nar areas, combined with our history of exploration success in the region, strongly suggests that we have the potential to extend and expand production in the coming years, providing us with a foundation for long-term growth of our gold business. Let me now turn to our wholly owned exploration and development projects. Starting on slide 11, Zuun Mod is one of the Asia's largest undeveloped molybdenum copper deposits. Our management team have recently traveled through China to visit molybdenum consumers. We are seeing tremendous interest in molybdenum and in Zuun Mod to help feed the demand for this commodity in the Asian specialty steel markets, especially as Chinese molybdenum mines approach end of life. We've also seen stronger molybdenum prices in recent months.

Peter C. Akerley: The gold-focused exploration opportunities in the Bayan Khundii and Altan Nar areas, combined with our history of exploration success in the region, strongly suggests that we have the potential to extend and expand production in the coming years, providing us with a foundation for long-term growth of our gold business. Let me now turn to our wholly owned exploration and development projects. Starting on slide 11, Zuun Mod is one of the Asia's largest undeveloped molybdenum copper deposits. Our management team have recently traveled through China to visit molybdenum consumers. We are seeing tremendous interest in molybdenum and in Zuun Mod to help feed the demand for this commodity in the Asian specialty steel markets, especially as Chinese molybdenum mines approach end of life. We've also seen stronger molybdenum prices in recent months.

The gold focused, expiration opportunities in the buying Hyundai, and Alton are areas combined with our history of expiration. Success in the region, strongly suggests that we have the potential to extend and expand production in the coming years. Providing us with a foundation for long-term growth of our gold business.

Let me now turn to our wholly owned, expiration and development projects.

Starting on slide 11, Zoom mod is 1 of the Asia's largest on developed lidam copper deposits.

I was recently at mining conferences in Hong Kong and Singapore and our management team have recently. Traveled through China to visit Malibu consumers, we are seeing tremendous interest in maliban and in Zoom mod to help feed the demand, for this commodity, in the Asian specialist steel markets, especially as Chinese maliban and Minds approach end of life. We've also seen stronger, maliban prices in recent months,

Peter Akerley: In Q1, we announced results from 18 holes, which included multiple intersections of ore grade mineralization in areas previously modeled as waste. To highlight just one hole, ZMD-98 extended to 450 meters depth, intersected near continuous molybdenum copper mineralization over 374 meters and averaged 0.07% molybdenum equivalent. These drill results, along with metallurgical test work underway to develop a conceptual process flow sheet, mine planning, processing, and infrastructure studies will all be incorporated into the Zuun Mod preliminary economic assessment planned for completion by Q3 2026. We expect the pending PEA will demonstrate the value creation potential of this large project for shareholders. The other projects in our portfolio include the Khuvyn Khar copper prospect and the Tereg Uul property in the Oyu Tolgoi district.

Peter C. Akerley: In Q1, we announced results from 18 holes, which included multiple intersections of ore grade mineralization in areas previously modeled as waste. To highlight just one hole, ZMD-98 extended to 450 meters depth, intersected near continuous molybdenum copper mineralization over 374 meters and averaged 0.07% molybdenum equivalent. These drill results, along with metallurgical test work underway to develop a conceptual process flow sheet, mine planning, processing, and infrastructure studies will all be incorporated into the Zuun Mod preliminary economic assessment planned for completion by Q3 2026. We expect the pending PEA will demonstrate the value creation potential of this large project for shareholders. The other projects in our portfolio include the Khuvyn Khar copper prospect and the Tereg Uul property in the Oyu Tolgoi district.

In q1, we announced results from 18 holes, which included multiple intersections of or grade mineralization in areas previously modeled as waste to highlight just 1 hole. Zoom mod 98 extended to 450 M depth intersected near continuous maliban and copper mineralisation over 374 meters and average 07 will abdominal equivalent.

These drill results along with metallurgical test work underway to develop a conceptual process. Flow sheet, mine planning processing and infrastructure studies.

Will all be incorporated into the zoom mod preliminary economic assessment plan for completion by Q3 2026.

We expect the pending PEA will demonstrate the value creation potential of this large project for shareholders.

Peter Akerley: At Khuvyn Khar, in Q1, we engaged consultants to conduct geophysics to generate copper porphyry targets for further drilling in 2026. This work will follow up on the intersection of 65 meters averaging 0.6% copper, including 30 meters averaging 1.25% copper, which we reported in early Q1. At Tereg Uul, we recently completed geophysical and geochemical studies to select targets for drill testing. Our first drill program started just a few days ago. These projects are at an earlier stage, but they have tremendous value creation potential, and we expect them to generate news flow for a prolonged period as we're just getting started on these projects. In summary, Bayan Khundii is our foundation, but the exploration pipeline is our future.

Peter C. Akerley: At Khuvyn Khar, in Q1, we engaged consultants to conduct geophysics to generate copper porphyry targets for further drilling in 2026. This work will follow up on the intersection of 65 meters averaging 0.6% copper, including 30 meters averaging 1.25% copper, which we reported in early Q1. At Tereg Uul, we recently completed geophysical and geochemical studies to select targets for drill testing. Our first drill program started just a few days ago. These projects are at an earlier stage, but they have tremendous value creation potential, and we expect them to generate news flow for a prolonged period as we're just getting started on these projects. In summary, Bayan Khundii is our foundation, but the exploration pipeline is our future.

The other projects in our portfolio include the Hooven Heart copper prospect and the Terra gold property in the Ulgii Togoi district.

At Hoover and Q1, we engage consultants to conduct geophysics to generate copper pore for RET targets, for further drilling in 2026.

This work will follow up on the intersection of 65 m, averaging 0.6% copper, including 30 m averaging 1.25% copper, which we reported in early Q1.

At Tierra ghoul we recently completed geophysical and geochemical studies to select targets for drill testing. Our first drill program started just a few days ago.

These projects are at an earlier stage, but they have tremendous value creation, potential, and we expect them to generate new slow for a prolonged period. As we were just getting started on these projects.

Peter Akerley: By continuing to progress the gold exploration targets held by Erdene Mongol and advancing our Zuun Mod, Khuvyn Khar, and Tereg Uul projects, we're building a company with significant opportunities for multiple new discoveries and developments, thereby providing tremendous upside for our shareholders. Now, I'd like to turn the call over to Bob to provide financial highlights for the quarter.

Peter C. Akerley: By continuing to progress the gold exploration targets held by Erdene Mongol and advancing our Zuun Mod, Khuvyn Khar, and Tereg Uul projects, we're building a company with significant opportunities for multiple new discoveries and developments, thereby providing tremendous upside for our shareholders. Now, I'd like to turn the call over to Bob to provide financial highlights for the quarter.

In summary, fine, Hyundai is our foundation but the expiration pipeline is our future by continuing to progress the gold. Expiration targets held by in Mongol and advancing, our Zoom mod Hoover and Tara ghoul projects. We're building a company with significant opportunities for multiple new discoveries and developments. Thereby, providing tremendous upside for our shareholders.

Now, I'd like to turn the call over to Bob to provide financial highlights for the quarter.

Robert Jenkins: Thank you, Peter. Moving on to slide 13, let me provide the financial highlights for the quarter ended 31 March 2026. Before getting into the details of Erdene's financial results, a reminder to everyone on the call, Erdene's investment in Bayan Khundii is held through its joint venture stake in the Mongolian company, Erdene Mongol LLC. The following discussion on Erdene's consolidated financial results, which have been prepared in accordance with International Financial Reporting Standards, reflects only our proportionate share of Erdene Mongol's operating results as well as our corporate operations. All figures are in Canadian dollars unless otherwise noted.

Thank you, Peter moving on to slide 13. Let me provide the financial highlights for the

quarter ended March 31st 2026.

before getting into the details of Ernie's Financial results, a reminder to everyone on the call herdin's investment in buying Hyundai is held through its joint venture state in the Mongolian company in Mongol LLC

Robert Jenkins: Erdene's share of income from Erdene Mongol totaled CAD 7 million for the 3 months ended 31 March 2026, compared to a loss of CAD 2.1 million for the 3 months ended 31 March 2025, as Bayan Khundii achieved commercial production in Q1 2026, while in Q1 2025, the mine was under construction and not yet generating revenue. For Q1 2026, exploration and evaluation expenses for Erdene Resource Development Corporation, representing the work by our team on controlled properties, totaled CAD 891,000 compared to CAD 974,000 for the 3 months ended 31 March 2025, with the quarter-over-quarter reduction primarily due to an increase in reimbursements from Erdene Mongol for geologic and technical support provided on their behalf.

Therefore the following discussion on earnings Consolidated Financial results which have been prepared in accordance with International financial reporting standards. Reflects only our proportionate share of urban Mongols operating results, as well as our corporate operations. All figures are in Canadian dollars unless otherwise noted

Earring share of income from earn. Mongol told 7 million for the 3 months ended, March 31st, 2026 compared to a loss of 2.1 million for the 3 months. Ended March, 31st, 2025 as Bay and Hyundai achieved commercial production in q1 2026. Well, in q1 2025, the mine was under construction and not yet generating Revenue.

Over a quarter reduction, primarily due to an increase in reimbursements from Urban Mongol for geological and Technical Support provided on their behalf.

Robert Jenkins: Corporate and administrative expenses representing Erdene's public company costs totaled CAD 1.4 million in Q1 2026, compared to CAD 1.5 million in Q1 2025, with the change compared to the prior year quarter primarily due to a reduction in non-cash share-based compensation costs, partially offset by higher spend on investor relations, professional fees, and regulatory costs as we increased our marketing efforts following the first gold pour at Bayan Khundii in late 2025. These costs are typically higher in the Q1 of the year as they incorporate annual employee bonuses and non-cash equity compensation grants based on performance in the preceding year.

Corporate and administrative expenses. Representing earnings public company costs totaled. 1.4 million in q1 2026 compared to 1.5 million in q1 2025.

With a change compared to the prior year quarter primarily due to a reduction in non-cash share based compensation costs.

Partially offset, by higher, spend on investor relations, professional fees, and Regulatory costs.

As we increase our marketing efforts following the first goal for at buying Hyundai in late 2020.

These costs are typically higher in the first quarter of the year as they incorporate annual employee bonuses, and non-cash Equity compensation grants based on performance in the preceding year.

Robert Jenkins: In total, Erdene generated net income of CAD 4.8 million for the 3 months ended 31 March 2026, compared to a net loss of CAD 4.5 million for the 3 months ended 31 March 2025, with the change compared to prior period primarily due to the current period contribution from Erdene Mongol LLC. Corporately, Erdene ended the quarter with CAD 29 million of cash following the bought deal private placement in February 2026. This cash will allow us to advance the Zuun Mod, Khuvyn Khar projects, and Tereg Uul, as Peter has just described. Erdene Mongol ended the quarter with USD 21 million of cash on hand. No further capital injections are expected from Erdene to fund operations at Bayan Khundii as the mine is generating positive cash flow from operations. This concludes the review of our financial performance for Q1 2026.

In total urging generate net income of 4.8 million for the 3 months and it March 31st, 2026 compared to a net loss of 4.5 million. For the 3 months ended, March, 31st 2025 with a change compared to Prior period. Primarily due to the current period contribution from earn Mongol LLC.

Corporately, earning end of the quarter with 29 million of cash, following the Bots deal private placement in March or sorry, February 2026. This cash will allow us to advance the zoom mod Hub and heart projects and cargo as Peter has just described.

Earn Mongol ended the quarter with us. 21 million of cash on hand. No further Capital injections are expected from erdin to fund operations at Bay Hyundai, as the mayor is generating positive cash flow from operations.

Robert Jenkins: I'll now turn the call back to Peter.

Peter Akerley: Thanks, Bob. Our success to date has been due to our people and our local relationships. Ensuring their health and safety is our top priority. On slide 14, I'll highlight our commitment to safety, the environment, and the communities where we operate. At the end of Q1 2026, we had 451 staff and contractors on site with a total of 479,000 person hours during the quarter. Approximately 40% of our direct site personnel are residents of Bayankhongor, the province hosting our mine, and 15% of the mine's employees are female. One of our key community initiatives is an equipment operator training program conducted in partnership with Mongolian Mining Corporation and focused on local employment.

Peter C. Akerley: Thanks, Bob. Our success to date has been due to our people and our local relationships. Ensuring their health and safety is our top priority. On slide 14, I'll highlight our commitment to safety, the environment, and the communities where we operate. At the end of Q1 2026, we had 451 staff and contractors on site with a total of 479,000 person hours during the quarter. Approximately 40% of our direct site personnel are residents of Bayankhongor, the province hosting our mine, and 15% of the mine's employees are female. One of our key community initiatives is an equipment operator training program conducted in partnership with Mongolian Mining Corporation and focused on local employment.

This concludes review of our financial performance for q1 2026. I'll now turn the call back to Peter

Thanks Bob.

Our success to date has been due to our people and our local relationships, ensuring their health. And safety is our top priority on, slide 14, I'll highlight our commitment to safety of the environment, and the communities, where we operate,

At the end of q1 2026, we had 451 staff and contractors on site with a total of 479,000 person hours, during the quarter approximately, 40% of our direct site Personnel, our residents of Bayern hunger, The Province, hosting our mind and 15% of the minds employees are female.

Peter Akerley: We have had over 180 residents of Bayankhongor participate in a classroom and hands-on program at MMC's UHG mining complex over the past 2 years, with many joining the Bayan Khundii team. Erdene Mongol has been very active in the community, training, conducting community development programs focused on small and medium-sized entities through a microfinance program, local procurement, supporting public health services, and youth education. Erdene and Erdene Mongol are deeply committed to our communities and proud of the progress achieved through these programs. As you can see from my earlier remarks, we are generating momentum across our business. Achieving commercial production at Bayan Khundii is a major milestone and a testament to the hard work of our team. As I've said many times, the gold mine at Bayan Khundii is just the beginning.

Peter C. Akerley: We have had over 180 residents of Bayankhongor participate in a classroom and hands-on program at MMC's UHG mining complex over the past 2 years, with many joining the Bayan Khundii team. Erdene Mongol has been very active in the community, training, conducting community development programs focused on small and medium-sized entities through a microfinance program, local procurement, supporting public health services, and youth education. Erdene and Erdene Mongol are deeply committed to our communities and proud of the progress achieved through these programs. As you can see from my earlier remarks, we are generating momentum across our business. Achieving commercial production at Bayan Khundii is a major milestone and a testament to the hard work of our team. As I've said many times, the gold mine at Bayan Khundii is just the beginning.

1 of our Key Community. Initiatives is an equipment operator training. Program conducted in partnership with Mongolia mining Corporation and focused on local employment. We have had over 180 residents of Bayern, hungo are participate in a classroom and Hands-On program. At mmc's uhg mining complex over the past 2 years with many joining the Bayan Hyundai team,

Right in Mongol has been very active in the community training, conducting Community Development programs focused on small and medium-sized entities through a micro Finance program. Local procurement supporting Public Health Services and youth education berdine and erdan. Mongol are deeply committed to our communities and proud of the programs achieved through these programs.

Peter Akerley: Slide 15 summarizes our 2026 roadmap with a clear focus on transitioning Bayan Khundii into a steady state producer. This operational foundation allows us to capture maximum value from current gold prices while simultaneously delivering on exploration to expand the gold production towards at least 100,000 ounces of gold per year, while also extending its life beyond 10 years. I believe we are well-positioned both operationally and financially to deliver on these objectives and value for our shareholders and stakeholders alike. With that, I'll hand it back to the operator to begin the Q&A session.

Peter C. Akerley: Slide 15 summarizes our 2026 roadmap with a clear focus on transitioning Bayan Khundii into a steady state producer. This operational foundation allows us to capture maximum value from current gold prices while simultaneously delivering on exploration to expand the gold production towards at least 100,000 ounces of gold per year, while also extending its life beyond 10 years. I believe we are well-positioned both operationally and financially to deliver on these objectives and value for our shareholders and stakeholders alike. With that, I'll hand it back to the operator to begin the Q&A session.

As you can see, from my earlier remarks, we are generating momentum across our business achieving commercial production at Bayern, Hyundai is a major milestone in a testament to the hard work of our team. But as I've said, many times the gold mine at Bay, and Hyundai is just the beginning.

Slide 15 summarizes our 2026 roadmap, with a clear focus on transitioning by Andy into a steady-state producer.

This operational Foundation allows us to capture maximum value from current gold prices while simultaneously, delivering on expiration to expand the gold production towards at least 100,000 oz of gold per year, while also extending its life beyond 10 years. I believe we are well positioned, both operationally and financially to deliver on these objectives.

And value for our shareholders and stakeholders alike.

With that, I'll hand it back to the operator, to begin the Q&A session.

Operator: Thank you. As a reminder, to join the question queue, you may press star, then the number 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star, then 0. Participants on the webcast may type their questions into the Q&A box. We'll take a moment to let questions queue up. Your first question comes from the line of Don MacLean at Paradigm Capital. Your line is now open.

Thank you as a reminder, to join the question queue. You may press star then the number 1 on your telephone keypad.

Should you need assistance during the conference call you may signal an operator by pressing star then zero?

Participants in the webcast, May type their questions into the Q&A box.

We'll take a moment to let questions queue up.

Your first question comes from the line of Don McLean at paragraph Capital. Your line is now open.

Don MacLean: Hey, good morning, Peter and Bob and team. Looks like a nice step forward in March on the quarter. Things are progressing. Maybe a few questions, Peter, I'll ask you to put your mining engineer hat on. You know, one is, I guess we're all trying to see where we're vectoring in terms of where the all-in sustaining costs will land, where the steady state will be. We look at March, it was about twice the grade of January, February. I guess the first question of a few is that indicative of where we're going, or was that just a good month? We know when you're scheduling a mine, you know, there's higher grade areas, there's lower grade areas, and you're on a month by month, it can look quite granular.

Um, you know, 1 is I guess we're all trying to see where we're vectoring in terms of uh, where the all-in sustaining costs will uh, will land where the steady state will be. So we look at March, it was about twice the grade of January February, so,

I guess, the first question of a few is is that indicative of where we're going, or was that just a good month? Because we know when you're scheduling,

Uh, a mine—there's higher grade areas, there's lower grade areas, and you're on a month-by-month. That can look quite granular.

Peter Akerley: Yeah. Let me speak to the mining engineering technical side of that, and perhaps I'll let Bob conclude on the cost basis. Just to sort of lay the land for the progression we've seen in the pit to date, you know, first off, it's getting the entire team in that pit experienced in the selective mining of deposits. You're right, there's gonna be ebb and flow to those grades. Generally, I'm very pleased with the progress we're seeing that I think will lead us to getting closer to that steady state reserve grade of 3.8 grams per ton. You know, we come up against issues, and we face those issues and resolve them in most case. The experience question, which leads to dilution, is something that will just come with time and is improving.

Peter C. Akerley: Yeah. Let me speak to the mining engineering technical side of that, and perhaps I'll let Bob conclude on the cost basis. Just to sort of lay the land for the progression we've seen in the pit to date, you know, first off, it's getting the entire team in that pit experienced in the selective mining of deposits. You're right, there's gonna be ebb and flow to those grades. Generally, I'm very pleased with the progress we're seeing that I think will lead us to getting closer to that steady state reserve grade of 3.8 grams per ton. You know, we come up against issues, and we face those issues and resolve them in most case. The experience question, which leads to dilution, is something that will just come with time and is improving.

Peter Akerley: The crushing issue we address, which has led to improvement. The blasting side with the higher fragmentation we're addressing, and we've seen improvement there. We had some temporary inflow of water into the pit that restricted access to higher grade zones in April, but you know, that's a seasonal thing we've now dealt with. A long answer to your question, Don, I believe that we are headed towards that steadier state, sort of in that, you know, 3.5 gram range up to that 3.8. Not only did we see that over the last few weeks of March, but as we got through the inflow of water in early April, we've seen that and better over the last couple of weeks. Feel good with the trajectory we're on. Bob?

Peter C. Akerley: The crushing issue we address, which has led to improvement. The blasting side with the higher fragmentation we're addressing, and we've seen improvement there. We had some temporary inflow of water into the pit that restricted access to higher grade zones in April, but you know, that's a seasonal thing we've now dealt with. A long answer to your question, Don, I believe that we are headed towards that steadier state, sort of in that, you know, 3.5 gram range up to that 3.8. Not only did we see that over the last few weeks of March, but as we got through the inflow of water in early April, we've seen that and better over the last couple of weeks. Feel good with the trajectory we're on. Bob?

Yeah, so, let me speak to the the mining. Engineering technical side of that. And perhaps, I'll let Bob conclude on the uh, the cost basis. But just to sort of lay the land for the progression, we've seen in the pit to date. You know, first off, it's getting the entire team in that pit, uh, experience in the selective mining of deposits. And you're right. There's going to be ebb and flow to those grades. But generally, I'm very pleased with the progress, we're seeing that I think will lead us to getting closer to that steady state Reserve grade of 3.8 grams per tonne. Um, you know, we come up against issues and we face those issues and resolve them. In most cases, The Experience question, which leads to dilution is something that we'll just come with time and it is improving the crushing uh, issue we address which is Led

Improvement the blasting side with the higher fragmentation, we're addressing and we've seen Improvement there. We had some temporary inflow of water into the pit that restricted access to higher grade zones in April, but, you know, that's a seasonal thing. We've now dealt with. So, a long answer to your question done, I believe that we are headed towards that steadier State sort of in that, you know, 3 and

a half gram range up to that 3.8. Um, not only did we see that over the last few weeks of March, but as we got through the, um, inflow of water in early April, we've seen that and better over the last couple of weeks. So, feel good with the trajectory we're on.

Robert Jenkins: Yeah, thanks for that, Peter. Don, as far as costs that we saw in Q1, just doing the math on what came through versus the overall costs, it would work out to about $2,200 US an ounce. Now, obviously, given that the grade was below where we expect to be on a run rate and some of the mining challenges that Peter's outlined, we think that's, I mean, that is higher than where we expect to land. As you might recall, when we put our feasibility study out a few years ago, it was about $870. We've no doubt seen the impact of higher royalties and whatnot.

um, Bob

Robert Jenkins: Based on what we see in front of us, I think we are targeting somewhere around CAD 1,300 an ounce, but that will need to be updated as we get a bit more information and just learn a bit more as we get into this. The other thing that all would be aware is we've certainly seen some impact on fuel prices as all globally have. We sit here today, fuel prices are approximately 10% of our overall mining costs. Therefore, you know, there's a bit of a bogey there that we'll need to just work through as we fully understand the impacts and all would be in that same bucket.

Yeah, thanks for that Peter. John as far as costs that we saw in q1 uh just doing the math on what came through versus the overall costs. It would work out to about 2,200 us an ounce. Now obviously, given that the grade was below where we expect to be on a run rate and some of the mine challenges that Peters outlined we think that's, I mean, that is higher than where we expect to land. Uh, as you might recall when we put our feasibility, study out a few years ago, it was about 870 we've no doubt seen the impact of higher royalties and whatnot but

Based on what we see in front of us, I think we are targeting somewhere around $1,300 an ounce, but that will need to be updated as we get a bit more information and just learn a bit more as we get into this.

The other thing that all would be aware, is, we have certainly seen some impact on fuel prices as all globally. Have, as we sit here today, fuel prices are approximately 10% overall or

In cost. So therefore, you know there's a bit of a bulge there that will need to just work through as we fully understand the impacts and all would be in that same bucket.

Don MacLean: Well, CAD 1,300 would be impressive. Just back, Peter, to the blasting controls and the shovel accuracy, the feasibility study is all sort of theoretical, and you noted that there's progress, but do you think that the expectations built into the feasibility study are actually achievable on, in real life?

well, 1300 would be, uh,

would be impressive. Um, so just back Peter to the, the blast controls, and the shovel accuracy. Uh, the feasibility study is all sort of theoretical and you noted that there's progress. But do you think that the expectations built into the feasibility? Study are actually achievable on in real life.

Peter Akerley: You know, I'd say in the early operations, we're seeing anywhere from 20% to 30% dilution. As we have looked over the last several weeks and in late March, we've been able to see that dilution get under control and be closer to what we anticipated, perhaps in the 10% to 15% range. You know, it's a short window in time, but we're actually seeing the performance of ore grades delivered to the plant are actually superior once measured in the plant. We're just getting a positive reconciliation once we've now added all of these things to improve efficiencies. The jury's still out a little bit, Don, but what we've seen over the past several weeks suggests that's achievable.

Peter C. Akerley: You know, I'd say in the early operations, we're seeing anywhere from 20% to 30% dilution. As we have looked over the last several weeks and in late March, we've been able to see that dilution get under control and be closer to what we anticipated, perhaps in the 10% to 15% range. You know, it's a short window in time, but we're actually seeing the performance of ore grades delivered to the plant are actually superior once measured in the plant. We're just getting a positive reconciliation once we've now added all of these things to improve efficiencies. The jury's still out a little bit, Don, but what we've seen over the past several weeks suggests that's achievable.

You know, I'd say in the early operations we're seeing anywhere from 20 to 30% dilution and as we have looked

Over the last several weeks. And in, in late March, we've been able to see that dilution get under control and be closer to what we anticipated perhaps in the 10 to 15% range. But you know it's it's a, it's a short window in time. But we're actually seeing the performance of, uh, or grades delivered to the to the plant are actually Superior once measured in the plant. So we're just getting a positive reconciliation. Once, we've now added all of these things to improve efficiencies. So the jury is still out a little bit Dawn but, uh, what we've seen over the past several weeks, suggest that that's achievable

Don MacLean: You touched on reconciliation because that's such a critical thing, I know it's really early at this stage, but your grade and your tonnage reconciliation, compared to what you expected from the reserves and the feasibility study, how's that looking?

And, and you touched on reconciliation, because that's such a critical thing. And it's, I know it's really early at this stage, but your grade and your tonnage reconciliation,

Peter Akerley: I'd say it's ebbed and flowed over the last 6 months, and we'll be able to report on that more fully as we get into steady state later in Q2 and into Q3. As I said, when we look at the grade reported from the grade control model, which is actually more conservative than our global resource, we're now seeing grades reporting to the mill that are higher than our projected grades. Let's hope that continues. Like I say, it's a somewhat brief window in time, but we'll be able to give you more details on that as we have a larger body of information leading into our next reporting period.

Peter C. Akerley: I'd say it's ebbed and flowed over the last 6 months, and we'll be able to report on that more fully as we get into steady state later in Q2 and into Q3. As I said, when we look at the grade reported from the grade control model, which is actually more conservative than our global resource, we're now seeing grades reporting to the mill that are higher than our projected grades. Let's hope that continues. Like I say, it's a somewhat brief window in time, but we'll be able to give you more details on that as we have a larger body of information leading into our next reporting period.

How's that looking?

Don MacLean: Terrific. One last question. Don't mean to hold you up, but, you know, it is a critical stage at this point.

Don MacLean: Terrific. One last question. Don't mean to hold you up, but, you know, it is a critical stage at this point. The feasibility and the reserves were done at CAD 1,850 or something like that. The world is now, you know, 2.5 times that, or it's approximately.

I'd say it's ebbed and flowed over the last six months, um, and we'll be able to report on that more fully as we get into steady state later in Q2 and into Q3. But as I said, when we look at the grade reported from the grade control model, which is actually more conservative than our global resource, um, we're now seeing grades reporting to the mill that are higher than our projected grade. So let's hope that continues. Like I say, it's a somewhat brief window in time, but we'll be able to give you more details on that as we have a larger body of information leading into, uh, our next reporting period.

Don MacLean: The feasibility and the reserves were done at CAD 1,850 or something like that. The world is now, you know, 2.5 times that, or it's approximately.

Terrific. And one last question—I don't mean to hold you up, but you know, it is a critical stage at this point.

Peter Akerley: Yeah.

Peter C. Akerley: Yeah.

Don MacLean: What do you do with that material that is below the cutoff grade that was in the feasibility study? 'Cause it would actually have economic value. How do you deal with that?

So, the feasibility and the reserves were done at $1,850 or something like that. The world is now, you know, two and a half times that, or approximately. Um, yeah. So,

Peter Akerley: We're now looking at a price coming out of the independents targeting a cutoff grade price of around $3,800, $3,900, which pushes our economic cutoff grade down from what was around 0.7 to say 0.35. You're right. We're generating a tremendous amount of now economic ore that's being stockpiled. We have just set up bottle roll testing facilities at our site, at our lab. We have an ALS lab on the mine site, and we'll now begin bottle roll testing of various ores from Bayan Khundii and elsewhere to see if they can also complement this conceptual heap leach plan we have. That would be ideal if we could see recoveries coming out of the low grade Bayan Khundii that could go on a heap.

Peter C. Akerley: We're now looking at a price coming out of the independents targeting a cutoff grade price of around $3,800, $3,900, which pushes our economic cutoff grade down from what was around 0.7 to say 0.35. You're right. We're generating a tremendous amount of now economic ore that's being stockpiled. We have just set up bottle roll testing facilities at our site, at our lab. We have an ALS lab on the mine site, and we'll now begin bottle roll testing of various ores from Bayan Khundii and elsewhere to see if they can also complement this conceptual heap leach plan we have. That would be ideal if we could see recoveries coming out of the low grade Bayan Khundii that could go on a heap.

What do you do with that material? That is below the cutoff grade that was in the feasibility study because it would actually have economic value. How do you deal with that?

Peter Akerley: Otherwise, they're stockpiled for back-end processing at end of mine life, at some future date.

Peter C. Akerley: Otherwise, they're stockpiled for back-end processing at end of mine life, at some future date.

Don MacLean: Great. The operative is that they're being stockpiled. That's great.

Yeah. So we're not looking at a price coming out of the independent targeting a, uh, cut off grade price of around 3,800, 3900 us. Um, which pushes our economic cutoff grade down from what was around 7 to say 0.35. Um, so you're right, we're generating a tremendous amount of now economic ore, that's being stockpiled. Um, we have just set up a bottle roll, testing facilities at our site at our lab. We have an laa, ALS lab, uh, on the mine site. And we'll now begin bottle. Roll testing of various ores from buying Hyundai and elsewhere to see if they can also compliment this, uh, conceptual Heap, leech plan, we have. Um, so that would be ideal if we could see recoveries coming out of the low grade by and Hyundai that could go on a heap. Otherwise their stockpiled for back-end processing at end of mine life uh at some future date.

Peter Akerley: That's right. Yeah.

Peter C. Akerley: That's right. Yeah.

Great. But the the operative is that they're being stockpiled. That's great.

Yeah.

Don MacLean: Thank you very much.

Peter Akerley: Okay. Thanks, Don.

Peter C. Akerley: Okay. Thanks, Don.

Thank you very much.

Okay, thank you, Don.

Operator: Thank you. There are no further questions from the telephone. I will now pass the call over to John Vicsek to ask management questions that have come in from email and on the webcast. Please go ahead, John.

John Vincic: Yeah. Thank you. Thank you, operator. First question from the webcast: Peter, you've noted that Bayan Khundii can reach a capacity of about 100,000 ounces per year of production. When could that be achieved, and what are all the pieces that need to fall into place to get to that level?

Thank you. There are no further questions from the telephone, I'll now pass the call over to John's. It took to ask management questions that have come in from email and on the webcast, please go ahead. John.

Yeah, thank you. Thank you, operator. Uh, first question from the webcast Peter, you've noted that buying Hyundai can reach a capacity of about 100,000 ounces per year of production. Uh, when could that be achieved? And what are all the pieces that need to fall into place to get to that level?

Peter Akerley: There's a lot in there, John, but maybe let me walk through the where we could source that ore from. When you look at the Bayan Khundii system, as I mentioned in the presentation, there is a substantial amount of volume as you move west through Khundii West and across Erdenetsogt into Ulaan. If that could all be consolidated, perhaps you're getting up into a doubling of current resources, a large portion of that sitting in the Khundii West and Ulaan licenses that we currently control. When you look to the north, it's still very early stages at Dark Horse, but we see substantial room for growth there.

Peter C. Akerley: There's a lot in there, John, but maybe let me walk through the where we could source that ore from. When you look at the Bayan Khundii system, as I mentioned in the presentation, there is a substantial amount of volume as you move west through Khundii West and across Erdenetsogt into Ulaan. If that could all be consolidated, perhaps you're getting up into a doubling of current resources, a large portion of that sitting in the Khundii West and Ulaan licenses that we currently control. When you look to the north, it's still very early stages at Dark Horse, but we see substantial room for growth there.

So, there's a lot in there, John, but maybe let me walk through where we could source that ore from. When you look at the buying Hyundai system, as I mentioned in the presentation, there's a substantial amount of volume as you move west.

Peter Akerley: I think those sources, as we continue to expand our exploration activities, could provide us with the resource base, which would need to be up in that million-ounce plus range to support 100,000 ounce per year ore being provided to the facilities. When I say the facilities, I am thinking both the CIP and potentially the heap leach. The heap leach is that low-hanging fruit opportunity that if we can bring it on with a lower CapEx and lower OpEx, it could potentially introduce another 20,000 to 30,000 ounces per year production. That would allow you to peak over that 100,000 ounce mark, given we are currently targeting 80,000 to 85,000 from the CIP.

Peter C. Akerley: I think those sources, as we continue to expand our exploration activities, could provide us with the resource base, which would need to be up in that million-ounce plus range to support 100,000 ounce per year ore being provided to the facilities. When I say the facilities, I am thinking both the CIP and potentially the heap leach. The heap leach is that low-hanging fruit opportunity that if we can bring it on with a lower CapEx and lower OpEx, it could potentially introduce another 20,000 to 30,000 ounces per year production. That would allow you to peak over that 100,000 ounce mark, given we are currently targeting 80,000 to 85,000 from the CIP.

Through Hyundai West and across her and Sav into Juan. If that could all be Consolidated. Perhaps you're getting up into a doubling of uh, current resources. Um, a large portion of that sitting in the, in the Hyundai West, the new law and licenses that we currently control. Um, when you look to the north, it's still very early stages at Dark Horse, but we see substantial room for growth there. So, I think those sources as we continue to expand our expiration activities, could provide us with the resource base, which would need to be up in that million ounce. Plus range to substantial to, to support 100,000 Oz per year um or being provided to the facilities. And when I say the facilities, I'm thinking both the CIP and potentially the heat bleach.

Peter Akerley: If we had sufficient high-grade feed to add to the CIP plant, we do have the option of adding a gravity circuit at the front end that could potentially open up more volume going through the circuit. Those are the, sort of the areas of source and potential production expansion, which I feel quite confident on. We just have to continue through the additional exploration and studies in the coming year to put us in that position. I think one more thing I'd add to that, John, is that Altan Nar has the ability to add another, let's say, 70,000 to 80,000 ounces per year, just to put a bracket around it. We won't know until we complete the exploration up there that we'll start to pick up on later this year.

Peter C. Akerley: If we had sufficient high-grade feed to add to the CIP plant, we do have the option of adding a gravity circuit at the front end that could potentially open up more volume going through the circuit. Those are the, sort of the areas of source and potential production expansion, which I feel quite confident on. We just have to continue through the additional exploration and studies in the coming year to put us in that position. I think one more thing I'd add to that, John, is that Altan Nar has the ability to add another, let's say, 70,000 to 80,000 ounces per year, just to put a bracket around it. We won't know until we complete the exploration up there that we'll start to pick up on later this year.

The Heap leech is that low-hanging? Fruit opportunity that if we can bring it on with the lower capex and lower Optics, it could potentially introduce another 20 to 30,000 ounces per year production. So, that, that would allow you to peek over that 100,000 ounce Mark given, we're currently targeting 80 to 85,000 from the CIP. If we had sufficient high-grade feed to add to the, um, to the CIP plant, we do have the option of adding a gravity circuit at the front end, that could potentially open up, more volume going through the uh, through the circuit. So those are the sort of the areas of source and potential production expansion, um which I feel quite confident on. We just have to continue through the additional expiration and studies in the coming year to put us in that position.

I I think 1 more thing I'd add to that John is that Alton our

Peter Akerley: There's already half a million ounces of gold plus by-product in the near surface, sort of top 150 meters. I feel today we have an economic deposit there. It's just a matter of going through the increased exploration and studies. It's probably something that you couldn't see coming on until 2028, 2029 if we built a new facility. There is the optionality I discussed to bring the high-grade ore from Altan Nar to BK as well. That also sort of adds to that 100,000 plus per year, both source material and production facility.

Peter C. Akerley: There's already half a million ounces of gold plus by-product in the near surface, sort of top 150 meters. I feel today we have an economic deposit there. It's just a matter of going through the increased exploration and studies. It's probably something that you couldn't see coming on until 2028, 2029 if we built a new facility. There is the optionality I discussed to bring the high-grade ore from Altan Nar to BK as well. That also sort of adds to that 100,000 plus per year, both source material and production facility.

Seventy to eighty thousand ounces per year, just to put a bracket around it. We won't know until we complete the exploration up there—that will start to pick up on later this year. There's already half a million ounces of gold, plus byproduct, in the near surface, sort of top 150 meters.

Um, so I feel today, we have an economic deposit there. It's just a matter of going through the increased expiration and studies, it's probably something that you couldn't see coming on until 2829 if we built a new facility. But there is the optionality. I discussed to bring the high-grade order from, uh, Alton Nar to BK as well. So that also sort of adds to that 100,000 plus per year, both Source material and, uh, production facility

John Vincic: Thank you, Peter. The next question, what is the impact of rising oil prices on your cost structure?

Thank you, Peter. Uh, the next question. What is the impact of rising oil prices on your cost structure?

Robert Jenkins: I'll take that one, John. I think I alluded to this briefly in my response to Don MacLean. Just as a reminder, about 10% of the operating costs at Bayan Khundii are fuel related. We have sourced a majority of the energy for the project through an overhead transmission line that is under a take or pay arrangement. We're not directly exposed, as many sites would be where they are primarily diesel generation. All that to say, given the overall cost structure that we've seen, you know, if 10% of our costs are fuel related, that could be somewhere in the neighborhood of USD 100 an ounce that could hit the bottom line if we see oil prices continue to remain where they are.

I, I'll take that 1 John. I think I alluded to this briefly in my response to Don claim.

But just as a reminder about 10% of the operating costs at buying Honda air fuel related, uh, we have Source, a majority of the energy for the project through an overhead transmission line that is under a taker, pay Arrangement. So we're not directly exposed uh as many sites would be where they are primarily diesel Generation all that to say given the overall cost structure that

Be seen, you know if uh 10% of our costs are are fuel related. That could be somewhere in the neighborhood of $100.

Robert Jenkins: For reference, diesel price in Mongolia are in the neighborhood of $1.35 US liter today.

Once that will create the bottom line. If we see oil prices continue to remain where they are—and for reference, diesel price in Mongolia is in the neighborhood of $1.35 a liter today.

John Vincic: Thank you. Next question. You seem excited with the prospects for Zuun Mod. What can we expect from the upcoming PEA?

Thank you. Um, next question, uh, you seem excited with the prospects for Zoom mod. Um, what, what can we expect?

Um, from the upcoming PA.

Peter Akerley: Yeah. My excitement just increases exponentially on Zuun Mod as we talk more to the market. As I mentioned in the presentation, we spent some time in Asia both talking to investors, traders, molybdenum users, a really broad spectrum across the market. That tips into the copper demand discussions as well. You know, just very positive feedback in terms of the current demand and lack of supply. Every user of moly we met with in China would buy our concentrate today, and the prices today are in that CAD 28 to 30 a pound range, and actually somewhat higher in China than they are globally, given the shortage. You know, Zuun Mod is a very large open-pittable deposit at surface, low strip, good metallurgy. The knock against it was always its location because it was remote.

Peter C. Akerley: Yeah. My excitement just increases exponentially on Zuun Mod as we talk more to the market. As I mentioned in the presentation, we spent some time in Asia both talking to investors, traders, molybdenum users, a really broad spectrum across the market. That tips into the copper demand discussions as well. You know, just very positive feedback in terms of the current demand and lack of supply. Every user of moly we met with in China would buy our concentrate today, and the prices today are in that CAD 28 to 30 a pound range, and actually somewhat higher in China than they are globally, given the shortage. You know, Zuun Mod is a very large open-pittable deposit at surface, low strip, good metallurgy. The knock against it was always its location because it was remote.

Yeah. My excitement just increases exponentially on, uh, Zoom mod as we talk more to the market. Uh, as I mentioned in the presentation, we spent some time in Asia, talking to investors, traders, maybe users—a really broad spectrum of the, uh, the market. Uh, and that tips into the copper demand discussions as well. But, you know, just very positive feedback in terms of the current demand and lack of supply. Uh, every user of moly we met with in China would buy our concentrate today. And the prices today are in that $28 to $30 per pound range, and actually somewhat higher in China than they are globally, given the shortage. Um,

No. Zoom mod is a very large open pytables.

Peter Akerley: Today, you know, you've got a now completed haul road for metallurgical coal within 25km of the site. We've demonstrated we can tap into grid power. The demand is there. I think right time, right place. We're very excited about pushing that PEA across the line later in Q3. I think, you know, it's somewhat of a curiosity almost in our portfolio with no value attributed. There's significant value there that we'll, for the first time, demonstrate when we come out with a PEA, ideally in September.

Peter C. Akerley: Today, you know, you've got a now completed haul road for metallurgical coal within 25km of the site. We've demonstrated we can tap into grid power. The demand is there. I think right time, right place. We're very excited about pushing that PEA across the line later in Q3. I think, you know, it's somewhat of a curiosity almost in our portfolio with no value attributed. There's significant value there that we'll, for the first time, demonstrate when we come out with a PEA, ideally in September.

And the knock against it was always its location because it was remote and today you know you've got a now completed Hall Road for metallurgical coal within 25 km of the site we've demonstrated we can tap into grid power. Um the demand is there I think right time right place. Um we're very excited about pushing that PA across the line later in Q3 but I think, you know, it's somewhat of a curiosity, almost in our portfolio with no value attributed. But there's significant value there that will for the first time demonstrate when we come out with a pea, ideally in September,

John Vincic: Thanks, Peter. Another question from the webcast. Now that you've moved into full production, are there any thoughts to giving a more detailed breakdown of the income statement and balance sheet for the JV?

Thank you Peter. Another question from the webcast, now that you've moved into full production, are there any thoughts to giving a more detailed breakdown of the income statement and balance sheet for the JV?

Robert Jenkins: Thanks, John. I'll take that one. So I'd say there's kind of two answers to that question. First off, our financials are prepared in accordance with IFRS. Under IFRS, from the accounting rules, our GAAP financials cannot change materially. The requirements for joint venture accounting allow us just to show really our investment in Erdene Mongol, as well as our proportionate share of the income from Erdene Mongol. That said, you should expect to see more fulsome disclosure in our MD&A on the operating performance of Erdene Mongol and our proportionate share. Now that we are past commercial production, stay tuned in Q2 for a bit more disclosure there.

Thanks John, I'll take that 1. So let's say there's kind of 2 answers to that question. First off our

Financials are prepared in accordance with IFRS, and under IFRS, the accounting rules are:

Gap financials cannot change, materially the requirements. For joint venture. Count will allow us just to show really our investment in or Mongol, as well as our proportionate share of the income from earn Mongol.

That said, you should expect to see more fulsome disclosure error in our mdna, on the operating performance of earn Mongol and our proportionate share. And now that we are past commercial production States, stay tuned in Q2 for a bit more disclosure there.

John Vincic: Thank you, Bob. There's no further questions from the webcast. I'm gonna turn the call back to Peter Akerley for closing remarks. Peter?

Thank you, Bob. Um,

Thanks Peter.

Peter Akerley: Thank you, John, and thank you everyone for taking the time to join us today. We look forward to speaking to you again in a few months. Please, if you have any questions, reach out directly. We're always available. Have a good day, everyone.

Peter C. Akerley: Thank you, John, and thank you everyone for taking the time to join us today. We look forward to speaking to you again in a few months. Please, if you have any questions, reach out directly. We're always available. Have a good day, everyone.

Thank you, John. And thank you everyone for taking the time to join us today. Uh, we look forward to speaking to you again, in a few months, but, uh, please, if you have any questions, Reach Out directly, uh, we're always available. Um, have a good day, everyone.

Operator: Thank you. Ladies and gentlemen, this does conclude today's conference call. We thank you for participating. You may now disconnect.

Thank you, ladies and gentlemen, this does conclude today's conference call. We thank you for participating, you may now. Disconnect