Related Information
Heruga (Cu-Au-Mo) |
Project Summary
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Heruga is a world class, copper-gold porphyry deposit with elevated molybdenum content located approximately 570 km south of the capital city of Ulaanbaatar and 80 km north of the border with China. Heruga is the southernmost deposit of the Oyo Tolgoi mining complex which is currently being developed by Ivanhoe and its partner Rio Tinto. Entrée retains a 20% interest in the mineral resources of the deposit.
Access to the property from Ulaanbaatar is possible by an unpaved road, via Mandalgovi, or by air. A 2000 m long gravel airstrip was constructed at the site and is used routinely. Road infrastructure to China is being upgraded and an additional railway line is planned.
Heruga was discovered in 2007 from drilling of a deep IP chargeability anomaly by project operator Ivanhoe. The Entrée-Ivanhoe (now OTLLC) Joint Venture was formed in 2008 and covers an area of 39,864 hectares which also includes the Hugo North Extension deposit.
Underground mining of Heruga is detailed in the 'Life of Mine Sensivity Case' scenario presented in Ivanhoe's 2010 Integrated Development Plan. This scenario describes later phases of the Oyu Tolgoi mine development. At current resources, Heruga contains over 9 billion pounds of copper and over 14 million ounces of gold, attesting to its long-term importance to the mine development.
Milestones
| 2002 | Letter of intent between Entrée and private Mongolian company to acquire up to 60% interest in mineral concessions surrounding Oyu Tolgoi project |
| 2003 | Renegotiation of terms such that Entrée acquired a 100% interest in the same mineral concessions |
| 2004 | Earn-In Agreement with Ivanhoe Mines Ltd., later assigned to Ivanhoe Mines Mongolia Inc. XXK |
| 2007 | Discovery of Heruga deposit by drilling of an induced polarization geophysical anomaly |
| 2008 |
First resource estimate for Heruga deposit Entrée forms joint venture with Ivanhoe Mines through Ivanhoe Mines Mongolia Inc. XXK (now Oyu Tolgoi LLC) |
| 2009 |
Oyu Tolgoi Investment Agreement between Ivanhoe Mines, Rio Tinto and the Mongolian government Javhlant exploration licence converted to mining licence |
| 2010 |
Updated Inferred mineral resource estimate for Heruga Integrated Development Plan for the Oyu Tolgoi mining complex |
Links to Technical Reports
| June 2010 Lookout Hill Property (information on Hugo North Extension and Heruga development options) |
| March 2010 Lookout Hill Property (updated Inferred Mineral Resource estimate for Heruga) |
| March 2008 Lookout Hill Property (first Inferred Mineral Resource estimate for Heruga) |
Joint Venture with Ivanhoe Mines
Entrée's joint venture with Ivanhoe Mines (through its subsidiary Oyu Tolgoi LLC) provides that Entrée holds a 20% interest in any mineralization lying below a depth of 560 metres and a 30% interest in any mineralization occurring from surface to a depth of 560 metres. Entrée may choose to be carried through to production by way of debt financing from Ivanhoe Mines with interest accruing at prime plus 2%. This debt can be repaid in whole or in part from time to time or repayable by Entrée monthly from (and only from) 90% of the available cash flow arising from the sale of its share of products as defined within the joint venture agreement. This arrangement ensures that Entrée cannot be diluted down from its 20% or 30% position.
Oyu Tolgoi Investment Agreement
In October 2009, Ivanhoe Mines Mongolia Inc. (now Oyu Tolgoi LLC) and Rio Tinto International Holdings Ltd. signed the Investment Agreement with the Mongolian government. The Investment Agreement regulates the relationship between these parties and stabilizes the long term tax, legal, fiscal, regulatory and operating environment to support the development of the Oyu Tolgoi mining complex. The contract area defined in the Investment Agreement includes the Javhlant and Shivee Tolgoi mining licences, including Shivee West which is 100%-owned by Entrée and not currently subject to the Entrée-Ivanhoe Joint Venture. Satisfaction of conditions precedent within 6 months of the signing date was specified within the Investment Agreement and was completed March 31, 2010. With removal of the conditions precedent, the Mongolian government holds a 34% interest in Oyu Tolgoi LLC, which in turn holds (as a participant) an 80% interest in the Entrée-Ivanhoe Joint Venture.
Mine Development Plan
The Integrated Development Plan 2010 for the Oyu Tolgoi mining complex and its implication on Entrée's Hugo North and Heruga deposits are explained in the following news releases:
May 11, 2010 First Mineral Reserves for Hugo North Extension Included in Inititial Underground Mining
June 15, 2010 Entrée Files Technical Report on Hugo North Extension and Heruga Development Options
North-South Profile of Hugo Dummett, Southern Oyu and Heruga Deposits (Looking West)
(Courtesy of Ivanhoe Mines with modifications by Entrée Gold Inc.)
Geology and Mineralization
The copper-gold-molybdenum mineralization at Heruga is primarily hosted in Devonian augite basalts and less commonly in Devonian quartz monzodiorite intrusions. Quartz monzodiorite stocks and dykes intrude the mineralized units and may be contemporaneous with mineralization. The deposit is cut by several north-northeast oriented near-vertical post-mineral normal faults, which include the West Bor Tolgoi and Bor Tolgoi. Volcaniclastic strata are structurally juxtaposed over the Heruga deposit along a major, southeast-dipping fault zone. This fault (Contact Fault) ranges from a 30 m wide cataclastic zone to a narrow mylonite and places several hundred metres of post-mineral Devonian stratigraphy over the deposit.
The Heruga deposit is zoned in terms of mineralization with a molybdenum-rich zone at higher elevation and an increasing gold-rich mineralization at depth. Copper-rich mineralization occurs at intermediate levels and overlaps both the molybdenum-rich and gold-rich zones. The vertical extent of the overall mineralization is close to 800 m with overlapping zones of molybdenum (300 to 400 m), copper (600 m) and gold (450 m). Post mineral NNE trending subvertical faults have offset mineralization into two discrete structural blocks. Mineralization remains open down dip to the east of the eastern block and at depth of the western block. It is assumed that the western block terminates against a parallel NNE trending structure.
There is a rough spatial correlation between metal and alteration zonation and the two may be genetically linked. Generally speaking at deeper levels mineralization consists of chalcopyrite and pyrite in veins and disseminated within biotite-chlorite-albite-actinolite altered basalt or sericite-albite altered quartz monzodiorite. Selvages of salmon pink albite alteration occur with chalcopyrite associated with higher grade mineralization in both basalt and quartz monzodiorite. The higher levels of the orebody are overprinted by strong quartz-sericite-tourmaline-pyrite alteration where mineralization consists of disseminated and vein controlled pyrite, chalcopyrite and molybdenite. Gold may correlate with strong biotite alteration at the deeper levels of the deposit.
Mineralized veins have a much lower density at Heruga than in the more northerly Southern Oyu and Hugo Dummett deposits. High grade copper and gold intersections show a strong spatial association with contacts of the mineralized quartz monzodiorite porphyry intrusion in the southern part of the deposit, occurring both within the outer portion of the intrusion and in adjacent enclosing basaltic country rock. There is no oxide zone at Heruga, nor is there any high-sulphidation style mineralization known to date.
Last Updated: April 20, 2011
