I agree to and consent to receive news, updates, and other communications by way of commercial electronic messages (including email) from Entrée Resources. I understand I may withdraw consent at any time by clicking the unsubscribe link contained in all emails from Entrée Resources.
Material Agreements
Earn-in Agreement with Oyu Tolgoi LLC
On October 15, 2004, Entrée entered into an arm’s-length Equity Participation and Earn-In Agreement (the "Earn-In Agreement") with Turquoise Hill Resources Ltd. ( "Turquoise Hill"), which was subsequently amended and assigned to Turquoise Hill’s then wholly-owned subsidiary Oyu Tolgoi LLC ("OTLLC"). Under the Earn-In Agreement, OTLLC was granted the right to earn an interest in a land package comprising the eastern portion of the Shivee Tolgoi, and all of the Javkhlant mining licence (together, the "Licences") held by Entrée’s wholly owned subsidiary Entrée LLC. The Licences completely surround OTLLC’s 100% owned Oyu Tolgoi mining licence.
As part of its earn-in obligations under the Earn-In Agreement, OTLLC undertook an exploration program which established the presence of two significant deposits: the Hugo North Extension copper-gold deposit on the Shivee Tolgoi mining licence area and the Heruga copper-gold-molybdenum deposit on the Javkhlant mining licence area. These deposits form the northernmost and southernmost parts of the Oyu Tolgoi project, which is set to become the world’s fourth largest copper mine by 2030.
On June 30, 2008, OTLLC gave notice to Entrée that it had completed its earn-in obligations by expending a total of $35 million and a joint venture (the "Entrée/Oyu Tolgoi JV") was formed. Under the Entrée/Oyu Tolgoi JV, Entrée has a 20% participating interest with respect to mineralization extracted from deeper than 560 metres below surface and a 30% participating interest with respect to mineralization extracted from above 560 metres depth from the Entrée/Oyu Tolgoi JV property. OTLLC holds the remaining participating interest.
Joint Venture Agreement with OTLLC
Effective June 30, 2008, Entrée and OTLLC entered into a Joint Venture Agreement in the form annexed to the amended Earn-in Agreement. On February 3, 2025, the parties amended the Joint Venture Agreement to include the western portion of the Shivee Tolgoi mining licence for all purposes under the Joint Venture Agreement and formally executed and delivered the Joint Venture Agreement as amended (the "JVA"). The 62,920 hectare area subject to the JVA (the "Entrée/Oyu Tolgoi JV Property") is shown in the figure above. Under the JVA, OTLLC as Manager has overall management responsibility for operations on the Entrée/Oyu Tolgoi JV Property. A copy of the JVA has been filed on SEDAR+ and is available HERE. See "Entrée/Oyu Tolgoi JV Property - Overview".
Amended and Restated Equity Participation and Funding Agreement with Sandstorm Gold
Entrée has an agreement (the "Sandstorm Agreement") to use future payments that it receives from its mineral property interests to purchase and deliver gold, silver and copper credits to Sandstorm Gold Ltd. ("Sandstorm").
Under the terms of the Sandstorm Agreement, Sandstorm provided Entrée with a net deposit of C$30.9 million (the "Deposit") in exchange for the future delivery of gold, silver and copper credits equivalent to:
- 28.1% of Entrée’s share of gold and silver, and 2.1% of Entrée’s share of copper, produced from the eastern portion of the Shivee Tolgoi mining licence; and
- 21.3% of Entrée’s share of gold and silver, and 2.1% of Entrée’s share of copper, produced from the Javkhlant mining licence.
Upon the delivery of metal credits, Sandstorm will make a cash payment to Entrée equal to the lesser of the prevailing market price and $220 per ounce of gold, $5 per ounce of silver and $0.50 per pound of copper (subject to inflation adjustments). After approximately 8.6 million ounces of gold, 40.3 million ounces of silver and 9.1 billion pounds of copper have been produced from the Hugo North Extension and Heruga deposits, the cash payment will be increased to the lesser of the prevailing market price and $500 per ounce of gold, $10 per ounce of silver and $1.10 per pound of copper (subject to inflation adjustments). To the extent that the prevailing market price is greater than the amount of the cash payment, the difference between the two will be credited against the Deposit. A copy of the Sandstorm Agreement has been filed on SEDAR+.
Updated: February 2025