Hole EDG016C Assays Confirm Continuity of High Grade Copper Mineralization at Copper Flats
August 4, 2005
Vancouver, B.C., Thursday, August 4, 2005 - Entrée Gold Inc. (TSX-V: ETG; AMEX: EGI – “Entrée” or the “Company”) announces assay results for hole EDG016C, which was reported on June 28, 2005 to have intersected strong copper mineralization. A 193.1 m downhole interval, between depths of 1,324 m and 1,517.1 m, has now returned average grades of 3.06% copper and 1.08 g/t gold or a copper equivalent grade1 of 3.75% copper. The hole ended in high-grade mineralization at 1,517.1 m due to drilling difficulties.
Greg Crowe, Entrée’s President and CEO, commented: “The assays in hole EGD016C confirm the continuity of high grade mineralization from the Entrée-Ivanhoe boundary northwards to hole EGD008, a strike distance of approximately 450 m. The system remains open to the north and to depth. Ivanhoe Mines Ltd. (NYSE: IVN; TSX: IVN; – “Ivanhoe”) continues to aggressively evaluate the potential along-strike continuation of the Hugo North copper-gold porphyry system.”
Separately, the Company reports that Hole EGD020, which was collared an additional 450 m north of EGD008, was lost due to drilling difficulties, before it could test the targeted depth of the potential mineralized system. Ivanhoe has now initiated a new hole (EGD053), located 150 m north of EGD008 and 300 m south of hole EGD020, to more conservatively test the continuation of the system and to attempt to avoid drill difficulties due to faulting.
The Ivanhoe Earn-In
Under an “Earn-In Agreement” announced in October 2004, Ivanhoe has the right to earn an interest in approximately 22% (40,000 hectares) of Entrée’s Lookout Hill property, Mongolia. By the terms of the agreement, Ivanhoe must spend a minimum of US $20 million in order to earn any interest in the mineral rights to the Project Property and may acquire up to a 70% interest in mineralization above a depth of 560 m and an 80% interest in mineralization below a depth of 560 m by spending US$35 million. Thereafter, Entrée has the right to require Ivanhoe to fund its share of subsequent joint venture costs through to production, to be recovered from production cash flow.
In October 2004, Entrée received CDN $4.6 million from Ivanhoe in the private placement to Ivanhoe of 4.6 million units (each comprising a share and a warrant). The warrants were exercisable to purchase an additional 4.6 million Entrée shares, at a price of $1.10 each, for two years.
In July 2005, Entree received $13,875,226 from Rio Tinto plc (NYSE: RTP; LSE: RIO.L) in the placement to a subsidiary of Rio Tinto of 6,306,921 units (each comprising a share and two warrants) at a price of $2.20 each. The warrants are exercisable for two years to purchase an additional 6,306,920 shares, half at $2.75 each, and half at $3.00 each.
With the Rio Tinto placement, Entrée received an additional $7,778,075 from Ivanhoe when Ivanhoe exercised its 4.6 million warrants at $1.10 and its preemptive right to participate in any private placement, by purchasing 1,235,489 units of the $2.20 unit placement.
Entrée now has a treasury cash balance of approximately $26 million with which to accelerate the independent exploration of the its large Lookout Hill land position, surrounding Turquoise Hill and the Hugo North extension, and its Ulziit Uul copper gold porphyry target, located 120 km north of Lookout Hill. Entrée also continues to evaluate possible acquisitions.
1(Copper equivalent grades have been calculated using assumed metal prices (US$0.80/lb. for copper (Cu) and US$350/oz. for gold (Au)); % Cu equivalent = % Cu + [Au (g/t) x (11.25/17.64)])
QUALITY ASSURANCE AND CONTROL
Robert Cann, P.Geo., Entrée’s Exploration Manager and a qualified person as defined by National Instrument 43-101, is responsible for the preparation of technical information in the Company’s news releases. SGS Mongolia LLC prepares the split core at the project site and assays all samples at its facility in Ulaanbaatar, Mongolia. Ivanhoe’s QA/QC program is monitored by independent consultant Dr Barry Smee, P.Geo., and managed on site by Dale Sketchley, M.Sc., P.Geo. Prepared standards and blanks are inserted at the sample preparation lab on the project site to monitor the quality control of the assay data.
ABOUT ENTRÉE GOLD INC.
Entrée Gold Inc. (www.entreegold.com) is an exploration stage junior resource company engaged in the exploration of gold and copper prospects. The Company is a large landholder in Mongolia’s south Gobi Desert, near the Chinese border. Entrée maintains 100% interest in the 179,590 hectare Lookout Hill (Shivee Tolgoi) property which completely surrounds Ivanhoe Mining Inc.’s (NYSE: IVN; TSX: IVN – “Ivanhoe”) 8,500 hectare, Turquoise Hill (Oyu Tolgoi) holdings. Ivanhoe has an earn-in agreement with Entrée whereby Ivanhoe can earn up to an 80% interest in a project area covering approximately 22% (approximately 40,000 hectares) of Entrée’s Lookout Hill property by spending US$35 million on the project and financing Entrée’s subsequent share of project expenditures. Entrée is a Tier 1 listed company that trades on the TSX Venture Exchange under the symbol “ETG” and on the AMEX under the symbol “EGI”.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
This news release contains forward-looking statements. Forward-looking statements are statements which relate to future events. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.
While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results. Readers are referred to the sections entitled “Risk Factors” in the Company’s periodic filings with the British Columbia Securities Commission, which can be viewed at www.SEDAR.com, and with the United States Securities and Exchange Commission, which can be viewed at www.SEC.gov.