Mongolia’s Erdene Resource Development Corp. has commenced gold production at its Bayan Khundii mine in Bayankhongor Province and aims to reach a monthly output of 7,000 ounces before the end of 2025, marking a major milestone for the country’s emerging gold sector.
The company operates the project through a 50:50 joint venture with Mongolian Mining Corporation (MMC). Erdene said it plans to repay its $110 million debt by mid-2026, paving the way for future expansion.
Expansion and Exploration Plans
Erdene is evaluating near-term expansion opportunities, including:
- Increasing open-pit reserves at Bayan Khundii by 150,000 ounces;
- Bringing the Dark Horse deposit — a near-surface, high-grade zone containing 50,000 ounces of gold — into production, leveraging existing infrastructure and processing capacity.
The company’s regional portfolio also includes:
- The Altan Nar polymetallic deposit, with an estimated 500,000 ounces of gold-equivalent resources;
- The Zuun Mod molybdenum project, positioned to meet growing industrial demand from China.
For 2026, Erdene has allocated $7 million for exploration, targeting new near-surface discoveries to increase annual output to between 200,000 and 250,000 ounces. The company said its strategy remains focused on low-risk, high-probability deposits.
Gold Market Recovery and Financial Outlook
Global demand for precious metals has strengthened amid economic uncertainty and shifting monetary policy, driving renewed investor interest in gold. Erdene’s transition from developer to producer provides both cash flow generation and significant exploration upside.
President and CEO Peter Akerley said the company’s ramp-up is on schedule:
“We expect to achieve full capacity within a few months. By year-end, our goal is to process ore averaging four grams per tonne and produce around 7,000 ounces of gold per month,” he said.
Akerley highlighted the project’s metallurgical efficiency, describing Bayan Khundii as a “remarkable deposit” with minimal sulfides and strong gold recoveries of 93–95% using conventional crushing, grinding, and leaching technology.
Erdene’s financing structure remains balanced, with approximately $115 million in total investment and $60 million in debt, a level the company considers sustainable. Based on current gold prices, Erdene expects to fully repay its debt by mid-2026, strengthening its ability to fund future expansion.
