“We are pleased to have expanded our fall 2020 drill campaign with a significantly larger program than we initially planned due to encouraging indications of a significant sulphide system at the high-priority northeast IP target,” stated Fred Speidel, vice-president, exploration, for Maple Gold. “While assay results are taking longer than anticipated to be returned, we made the decision to mobilize a second drill rig to further test this regional anomaly along its full two-kilometre-long strike length with two additional holes.

“Additionally, one of the key themes at Maple Gold has been the generation and testing of new discovery targets at our district-scale Douay property, and this will continue to be a focus for us in 2021. The IP work that has begun covers a large area along an important shear zone just north of the currently known resource and includes an undrilled potential source area for the highest gold-in-till anomaly on the property. There are many exciting opportunities like this at the property, and we look forward to systematically detailing more targets for upcoming drill campaigns,” concluded Mr. Speidel.

Fall 2020 drilling campaign

The company has expanded its fall 2020 drill program to consist of 10 holes, eight of which have been completed and two pending completion in January, 2021, for a total of approximately 4,050 metres drilled to date. Key details are as follows:

• Three holes were completed at the high-priority regional northeast IP target with one additional hole in progress and pending completion in early January, 2021. Additional holes may be drilled at three remaining permitted sites on this target in the company’s winter 2021 program.
• An initial hole was completed at the high-priority regional P8 target. Two additional permitted sites may be drilled in the winter 2021 drill program.
• Five holes were drilled in and around the Douay mineral resource — one stepout hole at the Main zone, one infill hole at the 531 zone and three infill holes at the Porphyry zone.

The initial assay process is taking longer than expected, and results will be announced in first quarter 2021 once they have been received, vetted, compiled and interpreted. Planning is also well under way for the company’s winter drilling program, which is expected to commence in mid-January and will cover approximately 10,000 metres with multiple drill rigs.

Winter 2021 IP survey

During December, the company commenced line cutting for a large IP survey to cover an initial 15-square-kilometre target area extending up to four km northwest of the Central zone at the Douay mineral resource. Line cutting on the first grid is now nearing completion, and IP surveying will begin in early January. This area is considered high priority for several reasons:

• Presence of a major lithotectonic boundary or shear zone known to be spatially associated with gold mineralization at the Main, Central and NW zones;
• Presence of one of the richest overburden/top-of-bedrock historical drill results on the property at the Central zone: hole 76955 encountered 256 gold grains within the basal till sample, with 240 gold grains being delicate and therefore likely transported no more than 500 metres down ice to the southeast; this potential source area remains undrilled;
• Presence of multiple drilling gaps extending over hundreds of metres;
• Presence of several undrilled linear artificial intelligence targets to the north of the NW zone (see press release from Nov. 30, 2020).

The company expects to complete a total of approximately 117 line kilometres during this IP program. A second grid to be tested will include a new target located approximately 2.2 km southeast of the P8 target, and a third grid located about nine km to the southwest of the P8 target will be surveyed to test a structural concept on the Joutel property, which is contiguous with the Douay property. The company aims to delineate new high-priority drill targets upon the completion of the IP surveys in these three areas.

Grant of stock options

The company has granted a total of 600,000 incentive stock options at a price of 38.5 cents to a director and officer. The company’s equity incentive plan governs these incentive options, as well as the terms and conditions of their exercise, which is in accordance with policies of the TSX Venture Exchange.

During 2020, the company completed the refurbishment of the small-scale PGM circuit (previously the scavenger plant circuit) (PGM circuit D). The company only restarted and began operating the PGM circuit D during third quarter 2020 (following the mandatory general lockdown imposed by the government of South Africa in connection with the COVID-19 pandemic). The company has generated approximately 134 tons of pressed filter cake PGM concentrate and delivered approximately 32.18 tons during 2020 under the offtake agreement. The company forecasts continued ramping up of the PGM circuit D production and additional revenue from it during 2021.

Barplats’s tailings retreatment project located at its Crocodile River mine has been recovering chrome since December, 2018. With the refurbishment and operation of the PGM circuit D, and utilizing the retreatment project source material, the company is now able to generate PGM revenue.

Diana Hu, the president and chief executive officer of Eastern Platinum, stated: “Operating the PGM circuit D allows the company to diversify its revenue sources and is a direct benefit of the retreatment project. To build on this success, Eastplats intends to use part of the expected proceeds from the currently ongoing rights offering (see news release of Dec. 11, 2020) to further upgrade the PGM circuit D and refurbish the existing main PGM facility, thereby expanding its PGM processing capacity and potential revenue sources. The company is pleased to continue the development of opportunities in South Africa for its shareholders.”

Rights offering

The shareholders of the company were issued rights to acquire common shares as of Dec. 18, 2020. The rights are currently trading on the Toronto Stock Exchange under the symbol ELR.RT and the Johannesburg Stock Exchange under the symbol EPSN.

A copy of the notice of rights offering and the rights offering circular is available under the company’s profile on SEDAR and on the company’s website.

The rights offering will close on Jan. 22, 2021.

COVID-19

Effective Dec. 29, 2020, South Africa has raised its alert level to Level 3, in response to an increase in COVID-19 cases. The company continues to follow the health guidelines of the government of South Africa. The retreatment project remains in full operation, and continues to produce and transport chrome and PGM end product. The effects of COVID-19 are evolving and changing, and the consequences of a further increase in the alert level in South Africa, a temporary shutdown of any operations or other related issues cannot be reasonably estimated at this time, but could potentially have material adverse effects on the company’s business, operations, liquidity and cash flows.

We seek Safe Harbor.

The Drill Program is focused on testing known gold mineralization hosted on the north limb of an anticlinal structure that is parallel to a similar anticline that hosts the Goldboro Deposit, located approximately 3 kilometres to the north (Exhibit A). The Program will include the twinning of two historic drill holes to confirm high-grade intersections and to sample adjacent wall rock for low-grade mineralization, and testing whether the anticlinal structure immediately south of historical mining activity contains gold mineralization at shallow levels, particularly within the center of the anticline. The Company also plans to drill test two geophysical IP chargeability anomalies that have not been previously tested.

Highlights of the Lower Seal Harbour Property include:Proximity to Anaconda's Goldboro Gold Project, within a similar geological setting and mineralization characteristics;Significant high-grade, historical drill intercepts* reported by previous exploration work conducted in the 1980's consisting of 9,506.9 metres in thirty-nine drill holes, including:18.91 grams per tonne ("g/t") gold over 1.69 metres including 87.54 g/t over 0.33 metres in hole LSH-88-021;7.49 g/t gold over 3.65 metres including 106.01 g/t over 0.25 metres in hole LSH-87-011; 9.63 g/t gold over 1.46 metres in hole LSH-87-009; and5.14 g/t gold over 2.18 metres in hole LSH-88-021; History of intermittent past production** from 1904-1949 and reported 34,295 ounces of recovered gold (394,905 tonnes mined); andHistoric mineralization remains open for expansion along strike and at depth.

" Our focus at Lower Seal Harbour is the discovery of further gold mineralization based on our experience at Goldboro, which is now the single largest gold deposit in Nova Scotia. The current, early-stage work at Lower Seal Harbour is focused on determining the number of geological environments that host gold including previously untested wall rock adjacent to past workings; drill testing the hinge of the anticline, which in the Goldboro Deposit represents one of the key mineralized environments; and drilling previously untested geophysical anomalies that have strong resemblances to anomalies at Goldboro. Should the Lower Seal Harbour Property host another gold deposit, there is the potential to further expand the larger Goldboro Gold Project in the future."

~ Kevin Bullock, President and CEO, Anaconda Mining Inc.

Geology and History of Past ProductionThe Lower Seal Harbour Mine produced 34,295 ounces of gold, after mining 394,905 tonnes intermittently between 1904 and 1949. Gold is hosted in both the quartz veins and anticlinal host greywacke and argillite of the Goldenville Formation, with accessory arsenopyrite, pyrite and galena. Previously recognized mineralization is hosted solely on the limb of the fold with no past exploration undertaken in the hinge of the fold, which represents one of the key mineralized environments in the Goldboro Deposit. Thirty-nine (39) broad-spaced historical drill holes, totaling 9,506.9 metres have tested the Property to date.

This news release has been reviewed and approved by Paul McNeill, P. Geo., VP Exploration with Anaconda Mining Inc., a "Qualified Person", under National Instrument 43-101 Standard for Disclosure for Mineral Projects.

* All quoted drill core sample intervals, grades and production statistics have been compiled from historic assessment reports obtained from the Government of Nova Scotia. Representative drill core from drilling in the 1981, stored in Nova Scotia government facilities, have been inspected by Anaconda geologists for Lower Seal Harbour, though no mineralized core remained. The observed core was considered representative of the host rocks as described in terms of rock type and alteration. A 1988 assessment report related to drilling programs for Lower Seal Harbour were completed by Scotia Prime Resources Inc. with metallic screen fire assay analysis completed by Bondar-Clegg and Company Ltd. of Ottawa, Ontario. No QAQC procedures were noted in the Scotia Prime report.

**Historic production statistics for the Lower Seal Harbour are based on information compiled by the Government of Canada, Geological Survey and taken directly from government reports, specifically GEOLOGICAL SURVEY OF CANADA OPEN FILE 7150, Environmental geochemistry of tailings, sediments and surface waters collected from 14 historical gold mining districts in Nova Scotia (2012) by M.B. Parsons, K.W.G. LeBlanc, G.E.M Hall, A.L. Sangster, J.E. Vaive and P. Pelchat as well as Geological Association of Canada, Special Publication No. 5, Mineral Deposits of Canada, "Metallogenic Summary of the Meguma Gold Deposits, Nova Scotia", (2007) by Sangster, A. L. and Smith, P.K.

Readers are cautioned that data quoted in this press release predates the 43-101 instrument and it was not possible for Anaconda representatives to resample historic mineralized intervals. Sufficient work has not been completed by a Qualified Person to verify and validate the specific assay results of historical work.

Widths from drill core intervals reported in this press release are presented as core lengths only. True widths are unknown.

Highlights 1 :

New high-grade, shallow, gold discovery hosted in a 4 kilometre long structure in the western portion of Dark Horse demonstrates potential for significant gold discoveries near the Bayan Khundii deposit:

degree AAD-58 returned 45 metres of 5.97 g/t gold beginning at 10 metres down-hole, including 1 metre of 82.5 g/t gold within 8 metres of 27.1 g/t gold

degree AAD-57, located 180 metres north of AAD-58, returned 16 metres of 0.6 g/t gold beginning at 52 metres down-hole, and 48 metres of 1.2 g/t gold beginning at 194 metres down-hole, including 30 metres of 1.7 g/t gold

degree AAD-51, collared 1 kilometre north of AAD-57, returned 3 metres of 5.6 g/t gold beginning at 138 metres down-hole and 10 metres of 0.9 g/t gold starting 222 metres downhole

degree Results are pending for AAD-61, drilled 500 metres north of AAD-57 along the same mineralized trend and AAD-60 drilled 750 metres to the northeast (NE) along the main NE trending Dark Horse structure

Gold mineralization is associated with a north-south (N-S) structure traced by its magnetic low signature, local exposures of epithermal breccia and stockwork veining, and gold anomalism in soil

degree AAD-57 and 58 are located at the intersection of the N-S structure and the NE trending Dark Horse structures with associated large magnetic low and high IP chargeability anomalies, similar to the Bayan Khundii setting

{࣓ •} The Bayan Khundii Gold Resource2 includes 521,000 ounces of 3.16 g/t gold Measured and Indicated (“M&I”)3 and 103,000 ounces of Inferred resources at 3.68 g/t gold

A significant exploration program is planned for Q1 2021 to follow-up on this exciting discovery

1 Reported intervals in this release are downhole apparent widths. Continued exploration is required to confirm anisotropy of mineralization and true thicknesses

2 For details of the Mineral Resources see Khundii Gold Project NI 43-101 Technical Report, Tetra Tech December 4, 2019

3 M&I: 171,000 ounces of 3.77 g/t gold Measured, and 349,700 ounces of 2.93 g/t gold Indicated

Quotes from the Company:

“The Dark Horse prospect has been established as the most significant zone of gold mineralization since our discovery of the Bayan Khundii gold deposit,” said Peter Akerley, Erdene’s President and CEO. “These new, high-grade drill intersections, combined with the geophysical and geochemical signatures traced over a four kilometre mineralized trend, demonstrate the significant size potential of the newly defined Dark Horse prospect.”

“I would like to congratulate and thank our exploration team for the continued success. This team has delineated three deposits and discovered multiple prospects, including this new Dark Horse discovery in our Khundii Gold District,” continued Mr. Akerley. “These intercepts are a discovery in their own right, however, they also substantially increase our understanding of the gold potential of the broader Khundii system, providing multiple targets with similar structural and alteration characteristics. We are very excited by these results and look forward to initiating our 2021 exploration programs this quarter which is expected to demonstrate that Erdene’s Khundii District hosts a world class gold system.”

Dark Horse (Khar Mori) Discovery Overview (see plan maps and sections below)

The phase II Dark Horse drill program was completed in early December 2020 with an additional 3,085 metres drilled in 14 holes. In total, Erdene drilled 4,660 metres in 25 holes (AAD-40 to 64) at Dark Horse in 2020. The phase II program built upon results from phase I including proximal pathfinder element (arsenic, molybdenum and antimony) drill intersections, magnetic-low anomalies and gold-in-soil anomalies associated with major structures, particularly structural intersections and interpreted zones of dilation.

This newest discovery is located within a relatively under-explored area of the Dark Horse prospect. Situated along a north-south (N-S) trending structure traced by a magnetic low signature, local exposures of epithermal breccia and stockwork veining exhibiting gold anomalism in soil over a trend of approximately 4 kilometres. The N-S structural feature targeted by holes AAD-51, AAD-57 and AAD-58 and AAD-61 is located one kilometre west of AAD-48 (see October 26, 2020 release). This N-S feature has been traced over a 3-kilometre strike length from the Altan Arrow structure in the north to the CSZ Zone in the south, and continues further, one kilometre where it connects with the Bayan Khundii deposit; all lying within Erdene’s 100% owned 2,309 hectare Khundii mining license.

The new discovery area (AAD-57 and AAD-58) is located proximal to the intersection of the N-S structure and the NE trending Dark Horse structures with associated gold in soil anomalism, pronounced magnetic low and high IP chargeability signatures. Over one kilometre north from AAD-57 and AAD-58, along the N-S structure, hole AAD-51 returned multiple anomalous gold zones including 3 metres of 5.6 g/t gold at 138 metres and 10 metres of 0.9 g/t gold at 222 metres down-hole depth. One additional hole has tested the northern portion of the structure with results pending; AAD-61, located 500 metres north of AAD-57. South of the new discovery area, the N-S structure continues (untested) for 1.3 kilometres to AAD-33 (85-metre hole in CSZ Zone drilled in 2019) where drilling intersected a thick package of silicified and white mica altered volcanic rocks consisting of tuff and porphyritic dacite with quartz-hematite veins and stockwork breccias with moderate to intense disseminated pyrite, broad zones of pathfinder elements and low levels but anomalous gold.

  Dark Horse Phase II Drilling Highlights (intervals averaging greater than 0.3 g/t gold)
 
 Hole    FromTo Interval (1)g/t Au (2)
AAD-51  138 1413           5.61      
Incl    140 1411           16.22     
And     222 23210          0.92      
AAD-52  42  60 18          0.32      
And     83  86 3           1.00      
AAD-55  4   6  2           2.28      
AAD-57  52  68 16          0.58      
And     160 18020          0.45      
And     194 24248          1.18      
Incl    202 23230          1.74      
AAD-58  10  55 45          5.97      
Incl    32  54 22          11.98     
Incl    36  37 1           21.18     
Incl (3)41  49 8           27.07     
Incl    43  44 1           82.53     


  

1 Reported intervals are apparent thicknesses (i.e. downhole widths). Insufficient drilling has been completed at Dark Horse to determine orientation of the mineralized zones and therefore true widths cannot be determined at this time. Exploration drill holes are typically oriented normal to (at a right angle to) the trend of potential mineralized targets and holes dips range from 45 to 75 degrees. 2 Reported grades for intervals are weighted averages based on length of sampling intervals, typically 1 to 2 metres. No top cut has been applied; however, intervals greater than 10 g/t gold are reported separately for clarity. 3 Seven of the eight 1-metre samples in this interval returned assays greater than 10 g/t gold, the eighth sample returned an assay of 9.5 g/t gold. The highest grade interval (43-44 metres) is reported separately. Note: Exploration holes AAD-50, AAD-53, AAD-54, AAD-56 and AAD-59 intersected anomalous gold and/or zones anomalous in pathfinder elements (arsenic, molybdenum and antimony) but no significant intervals greater than 0.3 g/t gold.

The N-S feature is clearly evident on the magnetic survey map (see plan maps below), as are numerous zones of intersection between this structure and northeast trending structural lineations, characteristic of the Dark Horse prospect. Current structural interpretations suggest the N-S trending structural features represent zones of dilation formed during tectonic compression from the South Southwest (Kloppenburg 2017).

At surface, AAD-57 and AAD-58 are located within a porphyritic andesite unit and a series of residual silica quartz bodies (200 to 300 metres wide), possibly indicating a higher level epithermal or lithocap type environment. Holes AAD-57 and AAD-58 are located 180 metres apart and reside within a broad (approximately 100 metres by 500 metres) north-south elongate magnetic low bisected by a northeast structural lineation. This magnetic signature is currently interpreted as a zone of primary magnetite destruction through intense hydrothermal alteration. Induced polarization (IP) geophysics indicates a relatively intense chargeability high signature coincident with the magnetic low signature and soil geochemistry in the prospect area reflecting the high sulfide content of the alteration zone.

AAD-58 was a 200-metre hole drilled at a dip of 45 degrees along a southeast (135 degree) azimuth to test the coincident magnetic low, chargeability high and geochemically (gold-arsenic) anomalous signature associated within the N-S / NE structural intersection. This hole was drilled within an intensely altered fine-grained volcanic sequence exhibiting pervasive quartz-sericite-pyrite style alteration. Gold mineralization in this hole (45 metres of 5.97 g/t gold) is associated with a broad zone (10-55 metres downhole) of intense silicification, white mica (sericite) alteration and oxidization (iron oxide after sulphide) alteration. Veining within this interval occurs as crustiform textured quartz-sulphide (pyrite-limonite) veins, exhibiting both stockwork and sheeted characteristics. The most intense gold mineralization, 8 metres of 27 g/t gold (41-49 metres), is hosted within an intensely oxidized black epithermal breccia zone, geochemically anomalous in gold, arsenic, antimony, molybdenum and copper.

AAD-57 is a 251-metre hole drilled at a dip of 75 degrees along an easterly (90 degree) azimuth. This hole was collared 180 metres north of AAD-58 as a follow up to exploration drill hole AAD-34 completed in 2018, which returned anomalous gold, arsenic, antimony and copper. AAD-57 is located proximal to the N-S / NE structural intersection, and intense magnetic low and chargeability high signatures intersected within AAD-58. AAD-57 was drilled within an intensely white mica (sericite) altered and moderate to intensely silicified tuffaceous and brecciated volcanic sequence. The gold mineralization within AAD-57 is associated with broad zones of intense silicification and white mica (sericite) alteration dominated by quartz-carbonate-sulphide (arsenopyrite plus or minus pyrite) stockwork veins. Like AAD-58, AAD-57 exhibits sulphide (arsenopyrite and pyrite) concentrations and anomalous antimony coincident with the gold mineralization although the intensity of sulphide oxidation in AAD-57 is not as high as in AAD-58, likely due to its increased depth.

Located 1.2 kilometres north of AAD-58, AAD-51 was a 250 metre hole drilled at a dip of 45 degrees along a southeast (135 degree) azimuth, positioned to test the N-S structural feature. This drill hole was completed as a follow-up hole to AAD-18 (2018), which intersected anomalous gold mineralization. AAD-51 intersected multiple anomalous gold-bearing zones, including 3 metres (138-141 metres down-hole) of 5.6 g/t gold including 1 metre of 16.2 g/t gold and 10 metres (222-232 metres down-hole) of 0.92 g/t gold. Gold mineralization is associated within a sequence of intensely white mica (sericite) altered tuffaceous units hosting quartz-limonite stockwork veinlets and epithermal style breccias.

Diamond drill holes AAD-52 and AAD-55 also intersected anomalous gold in other areas of the Dark Horse prospect, including the following highlights: AAD-52: 18 metres of 0.3 g/t gold, from 42 down hole depth and 3 metres of 1.0 g/t gold at 83 metres, and AAD-55: 2 metres of 2.3 g/t gold, beginning 4 metres down hole. These areas will be further evaluated, and the results incorporated into future exploration programs.

Mongolia COVID-19 Update

Since confirmation of the first community transmission of COVID-19 in November 2020, the Government of Mongolia implemented a series of restrictions on the movement of people and delivery of goods and services. The Company’s Mongolia-based personnel have continued to work safely in accordance with Company and national protocols, concluding field programs in December 2020. While restrictions have been eased in the majority of the country’s territory, measures remain in place in Ulaanbaatar until at least January 11, 2021. In Q1 2021, the Company plans to re-mobilize and commence field programs in accordance with the Government’s guidelines for mining and mineral exploration activities.

The Company extends its appreciation to essential workers for their efforts to safeguard public health and help prevent the spread of COVID-19 in Mongolia and Canada.

Khundii Gold District

Erdene’s deposits are located in the Edren Terrane, within the Central Asian Orogenic Belt, host to some of the world’s largest gold and copper-gold deposits. The Company has been the leader in exploration in southwest Mongolia over the past decade and is responsible for the discovery of the Khundii Gold District comprised of multiple high-grade gold and gold/base metal prospects, two of which are being considered for development: the 100%-owned Bayan Khundii and Altan Nar projects. Together, these deposits comprise the Khundii Gold Project.

The Bayan Khundii Gold Resource1 includes 521,000 ounces of 3.16 g/t gold Measured and Indicated (“M&I”) Superscript 2 and 103,000 ounces of Inferred resources at 3.68 g/t gold. Within the M&I resource, a proven and probable open-pit reserve totals 409,000 ounces at 3.7 g/t (see the full press release here), providing significant potential growth of reserves with the development of the remaining M&I and Inferred resources2.

In July 2020, Erdene announced the results of an independent Feasibility Study for the Bayan Khundii Gold Project (press release here). The Feasibility Study results include an after-tax Net Present Value at a 5% discount rate and a US$1,400/oz gold price of US$100 million and Internal Rate of Return (“IRR”) of 42%. The Feasibility Study envisions an open-pit mine at Bayan Khundii, producing an average of 63,500 oz gold per year, for seven years, at a head grade of 3.71 g/t gold, utilizing a conventional carbon in pulp processing plant. Production is expected to commence in early 2022 based on the current project schedule.

Erdene Resource Development Corp. is a Canada-based resource company focused on the acquisition, exploration, and development of precious and base metals in underexplored and highly prospective Mongolia. The Company has interests in three mining licenses and two exploration licenses in Southwest Mongolia, where exploration success has led to the discovery and definition of the Khundii Gold District. Erdene Resource Development Corp. is listed on the Toronto and the Mongolian stock exchanges. Further information is available at http://www.erdene.com. Important information may be disseminated exclusively via the website; investors should consult the site to access this information.

1 For details of the Mineral Resources see Khundii Gold Project NI 43-101 Technical Report, Tetra Tech December 4, 2019 {䘩 –} SEDAR 2 M&I: 171,000 ounces of 3.77 g/t gold Measured, and 349,700 ounces of 2.93 g/t gold Indicated

An estimated 34,000 metres of drilling has been completed in the last three drill seasons at Eagle Mountain with a cut-off date for drill results of November 7, 2020 to be used in the Mineral Resource Estimation update to be announced in early 2021.

Highlights:Eagle Mountain Gold Deposit – Baboon Area:Results for three (3) core holes totalling 648 metres.Drill holes EME20-72 and EME20-73 have confirmed the expansion of three near-surface sub-horizontal gold mineralized zones (Zone 1 to 3) to the southwest of the Eagle Mountain deposit (Figure 2 and 3). Together with the results from No. 1 Hill area, immediately north of Baboon (refer to the Company news releases on July 29, 2020, and October 22, 2020), drilling has extended the mineralized footprint of the Eagle Mountain deposit by approximately 400 metres to the southwest (Figure 2). Highlight drill hole EME20-71 intersected 6.0 metres grading 3.06 grams per tonne (“gpt”) gold (“Au”) in saprolite at the base of Zone 1 (Figures 2 and 3). Eagle Mountain Gold Deposit – Kilroy Area:Resource in-fill drill results for three (3) core holes totalling 275 metres. Highlight drill hole EMM20-001 intersected 54.0 metres grading 1.72 gpt Au, including a higher grade sub interval of 12.0 metres grading 6.91 gpt Au (Figure 2). In-fill drill results at the Kilroy area support the historical results and the continuity of mineralization, including the presence of multiple sub-horizontal gold mineralized zones. Ann Prospect – Minnehaha area:Results for four (4) core holes totalling 766 metres.Ann represents a new near-surface discovery, 1.0 kilometre south of the Powis target, along the north-south trending Salbora-Powis structural corridor (Figures 1 and 2). Highlight drill hole EME20-081 exhibits similar characteristics to mineralized breccias in Salbora and Toucan with a breccia interval of 3.0 metres grading 5.40 gpt Au. Highlight drill hole EME-20-079 intersected 11.5 metres grading 3.37 gpt Au from surface, including a higher grade sub interval of 7.5 metres grading 5.21 gpt Au starting at 4.0 metres and hosted in unconsolidated near-surface material.

The Company’s exploration program in 2020 was designed to expand and confirm the continuity of mineralization of the Eagle Mountain and Salbora deposits for an updated mineral resource and to make additional discoveries within the broader area of Eagle Mountain.

Steve Parsons, P. Eng, and CEO of Goldsource, commented, “The latest results, once again, deliver on the 2020 objectives both in terms of demonstrating scope for further strike extensions at Eagle Mountain and in showcasing the prospectivity of the project with a new discovery, the Ann Prospect. We look forward to the upcoming announcement of the resource update and pushing forward in 2021 to further explore current prospects for potential increase in gold resources and to complete further in-fill drilling to substantially convert inferred mineral resources to indicated for 2021 pre-feasibility work.”

The following tables show the most significant results (uncut, undiluted):

Eagle Mountain Deposit - Baboon Step Out and Expansion In-fill Intercepts:

Hole ID (1)From (m)To (m)Drilled Interval (m)(2)Au (gpt)(3)
EME20-071      50.5  56.5                    6.0       3.06
               69.0  70.5                    1.5       0.67
              130.5 149.7                   19.2       0.57
      incl.   139.5 144.0                    4.5       1.98
EME20-072      29.5  31.0                    1.5       2.75
               55.0  59.5                    4.5       1.56
              198.0 217.5                   19.5       1.38
      incl.   198.0 202.5                    4.5       0.67
      incl.   216.0 217.5                    1.5      15.73
EME20-073      47.5  56.5                    9.0       0.66
               77.5  79.0                    1.5       0.50
               97.5 100.5                    3.0       1.39
              171.5 173.0                    1.5      10.98
              219.0 220.5                    1.5       0.75
              243.0 247.5                    4.5       0.67

Eagle Mountain Deposit - Kilroy Area In-Fill Intercepts:

Hole ID (1)From (m)To (m)Drilled Interval (m)(2)Au (gpt)(3)
EMM20-001      10.5  64.5                   54.0       1.72
      incl.    10.5  22.5                   12.0       6.91
        and    46.5  64.5                   18.0       0.47
      incl.    52.5  64.5                   12.0       0.61
               79.5  81.0                    1.5       1.23
EMM20-002      19.5  39.0                   19.5       1.01
      incl.    19.5  27.0                    7.5       2.20
               34.5  43.5                    9.0       0.41
EMM20-003       4.5   7.5                    3.0       1.52
               13.5  15.0                    1.5       0.46
               42.0  43.5                    1.5       0.71
               54.0  60.0                    6.0       1.15
               75.0  84.0                    9.0       0.47
      incl.    75.0  79.5                    4.5       0.75

Ann Prospect (Minnehaha Area) Expansion Intercepts:

Hole ID (1)From (m)To (m)Drilled Interval (m)(2)Au (gpt)(3)
EME20-042      48.0  49.5                    1.5       0.41
               54.0  55.5                    1.5       0.88
               69.0  75.0                    6.0       0.51
EME20-079       0.0  11.5               11.5 (4)       3.37
      incl.     4.0  11.5                7.5 (4)       5.21
EME20-081       2.5   4.0                1.5 (4)       0.55
               63.0  66.0                    3.0       5.40
EME20-082       4.0   5.5                1.5 (5)       2.17
               19.0  20.5                    1.5       0.64

Note: All numbers rounded.(1) EMD defines core holes drilled in-house. EME defines core holes drilled by drilling contractor. EMM defines core holes drilled by drilling contractor (man-portable rig).(2) True widths are 70 to 100% of drilled widths.(3) Cutoff grade of 0.3 gpt Au.(4) Unconsolidated materials.(5) Base of historical tailings into mineralized granodiorite (saprolite).

All sample preparation and geochemical analyses were completed by Actlabs Guyana Inc. in Georgetown, Guyana. Hole EME20-080 intersected mineralization below the Company’s cut off grade of 0.3 gpt Au.

Eagle Mountain Deposit

In-fill drilling in the Kilroy area of the Eagle Mountain deposit has confirmed the geologic and resource models containing several mineralized sub-horizontal (near-surface dip-slope) zones (Zone 1 to 3) with similar grades and continuity.

Expansion drilling in the No. 1 Hill and Baboon areas has extended the mineralized footprint of Eagle Mountain deposit by an estimated 400 metres to the southwest beyond the 2014 PEA Mineral Resource outline. Gold mineralization in expanded areas is present in multiple near-surface sub-horizontal zones (Zone 1 to 3). These prospects are open for further lateral extensions.

Ann Prospect

The Ann Prospect is a recent low cost option-to-purchase acquisition covering 10 hectares within the Company’s Eagle Mountain Prospecting Licence of 4,786 hectares.

The Company’s exploration program made a near-surface discovery at this newly acquired prospect. This new discovery is located 2.5 kilometres along trend from Salbora and 1.0 kilometre along trend from the previous most southernly known mineralisation at Powis, thereby expanding the prospective strike of the Salbora-Powis trend to 4.0 kilometres from Ann in the south to Montgomery in the north.

These more recent results will not be included in the pending mineral resource update.

Q1 2021 Drill Program

In January, there will be three (3) core drills operating at Eagle Mountain. Initially, these drill rigs are completing expansion holes for the Toucan Prospect, Ann Prospect, and in-fill holes for the Eagle Mountain deposit. A Mineral Resource update is currently being finalized to be announced in early 2021. Subsequently, a NI 43-101 Technical Report will be filed on SEDAR within 45 days.

The Qualified Person under National Instrument 43-101 – Standards of Disclosure for Mineral Projects for this news release is N. Eric Fier, CPG, P.Eng, Executive Chairman and VP Finance for Goldsource, who has reviewed and approved its contents.

Mac Balkam, chief executive officer and president of Eskay, said: “I am excited to have John and Rob join our management team for 2021 as we aggressively expand on the discoveries of 2020. Dr. DeDecker was the guiding force that reinterpreted the TV Jeff targets that resulted in two discoveries in the area. I am confident that, with John leading our geological team, we will be the story of the Golden Triangle in 2021. Rob has been a director since the beginning when we took over Eskay in 2010 and has played a significant role in the strategic development of the company. As we plan to drill 30,000 metres in 2021, Mr. Myhill’s background in senior finance and management will bring financial governance and control to allow the company to meet its goals.”

Dr. DeDecker received his bachelor of science in geology, with an emphasis on mineralogy, igneous petrology and mathematics from North Carolina State University. He completed his masters of science in geology at University of North Carolina at Chapel Hill studying physical volcanology and igneous petrology, then went on to complete a PhD in geology and geochemistry at Colorado School of Mines under the advisement of world VMS expert, Dr. Thomas Monecke. He is a post doctoral fellow at the school where he researches the gold-rich VMS deposits near the Eskay Creek mine. Dr. DeDecker is founding partner of BOA Exporation LLC.

Mr. Myhill holds an HBA and an MBA from the IVEY school of business administration at the University of Western Ontario and earned a CA designation while with Price Waterhouse. Mr. Myhill for 20 years was the president and CEO of Canadian Investors Corp., a investment management company focused on corporate re-organizations in a broad range of sectors across Canada. Mr. Myhill was president of a national company within the Jim Pattison Industries Group. Mr. Myhill also was VP of corporate development and finance at Southstar, a venture capital joint venture company between Toronto Star and Southam Inc.

The company wishes to advise that in its press release dated Dec. 14, 2020, announcing the closing of its $13.8-million brokered private placement, it erroneously referred to the issuance of 9,657,000 flow-through units of the company at a price of $1.25 per FT unit for aggregate gross proceeds of $13,799,625. The Company actually issued 7,725,600 FT units for gross proceeds of $9,657,000. After giving effect to the offering, current issued and outstanding capital of the company is 156,460,935 common shares.

The publication describes experimental work leading to the Company’s patented RecycLiCo™ process (US Patent No. 10,246,343 and PCT International Publication No. WO2018089595A1) for the recycling of valuable and critical metals from spent lithium-ion battery cathode materials. Included in the publication is lab-scale testing of NMC (lithium nickel manganese cobalt oxide), NCA (lithium nickel cobalt aluminum oxide), LMO (lithium manganese oxide), and LCO (lithium cobalt oxide) cathode materials. Key details demonstrate over 99% extraction of lithium, nickel, cobalt, and manganese and an environmentally friendlier closed-loop hydrometallurgical process that minimizes environmental impacts of recycling lithium-ion battery cathode materials.

“We are thrilled that a highly cited and respected peer-reviewed scientific journal like JES reviewed and published the findings of our research in lithium-ion battery cathode material recycling,” said Larry Reaugh, President and CEO of American Manganese. “This shows that the work we had undertaken to develop the RecycLiCo process is able to pass the scrutiny of people with expertise in this field.”

“As 2020 has come to an end and the new year has started, we want to thank our shareholders and stakeholders for their continued support. Prime has evolved during 2020 into a company with a highly skilled technical, management and governance team. Our geologic understanding of Los Reyes has increased significantly pointing to tremendous potential for a major new resource discovery,” stated Daniel Kunz, Chief Executive Officer.

Prime began 2020 announcing surface sampling results that demonstrated significant outcropping mineralized areas that carried good grades over significant widths, outside the historical resources at Zapote North and Zapote South. Additionally, the Company completed a significant new long-term agreement for surface use over the Los Reyes project area with Ejido de Tasajera, the majority local landowner. This access agreement is for an initial term of 15 years and can be extended for 15-years. The agreement covers project access and land use for exploration, engineering, construction, commissioning, and commercial operations. It is an extremely significant project milestone for the local communities, Prime and all project stakeholders, as it provides long-term project stability for the development of Los Reyes.

In early April, some 10 months after initial acquisition of Los Reyes, Prime announced a measured and indicated in-pit oxide mineral resource of 19.8 million tonnes (“M t”) at 1.00 gram per tonne (“gpt Au”) and 26.2 gpt silver (“gpt Ag”) containing 633,000 ounces of gold (“oz Au”) and 16,604,000 ounces silver (“oz Ag”). Additionally, the updated resource outlined an in-pit oxide mineral resource of 7.1 M t at 0.78 gpt Au and 30.0 gpt Ag (or 179,000 oz Au and 6,831,000 oz Ag contained). (See news release dated April 2, 2020).

On June 12, Prime closed a C$10,000,000 financing by issuing 20,000,000 units priced at C$0.50 per unit. Each unit consisted of one common share and one common share purchase warrant exercisable for one common share at an exercise price of C$1.10 for a period of 60 months following the closing. The lead participant in the offering was Trinity Capital Partners including Mr. Pierre Lassonde.

During the year Prime also announced key management changes including the appointment of Kerry Sparkes as Executive Vice President Exploration and Ian Harkas as Chief Financial Officer. Significant changes were also made to the Board of Directors. The current Board, comprising Messrs. Andy Bowering, Murray John (Chairman), Daniel Kunz, Paul Larkin, Marc Prefontaine and Paul Sweeney, has the exploration, construction and operating experience required to drive the Company forward, along with both project finance and country specific skills relating to project exploration and development in Mexico.

The Company amended an option agreement with Vista Gold Inc. under which it holds Los Reyes by cancelling all of Vista’s net smelter royalty and back-in rights in consideration for accelerating a final US$1.5M option payment owing to Vista and completing a series of additional cash payments totaling US$ 2.1M. (See news release dated July 20, 2020).

Los Reyes – 2020 Progress

The Los Reyes Gold-Silver Project is a district scale epithermal gold-silver project in a prolific mining region of Mexico. Mineralization in the Los Reyes area is typical of low sulfidation epithermal gold/silver systems. Over US$20M in exploration and engineering has already been spent on Los Reyes over 25 years. Previous operators completed various prefeasibility studies but held back from development due to declining gold prices. While the initial work completed provides sufficient understanding of resources to fast-track Los Reyes to production, the work to-date has been conducted over less than 40% of the known structures. Additionally, the depth potential of what is essentially an intact epithermal gold-silver system has been inadequately explored. This leaves significant opportunities to materially expand known resources.

Significant exploration progress has been made to date at Los Reyes. This ongoing work includes field mapping, trench sampling, rock alteration analysis and interpretation and re-logging of historic diamond drill core. This work led to a structural and rock alteration interpretation that is being used to guide the Company’s first diamond drill exploration program. Re-logging of several existing diamond drill core holes also identified that adularia, a crystalline mineral, containing high-grade gold and silver locally with visible gold, is associated with nearby altered rock types. The adularia appears to be vertically zoned. This zoning may provide a guide to effectively target areas of higher-grade gold and silver at depth below currently known mineralization. A study of alteration types indicates that the clay kaolinite is related to the main mineralizing event and may be considered a pathfinder to locations of higher-grade mineralization. Secondary clays may also serve to indicate higher-grade; these secondary clays include smectite, illite and montmorillonite. The initial data set was limited in size, so with the data available to-date, no assumptions can be made as to the lateral or vertical extent of gold-silver zoning. Data will continue to be collected and analyzed throughout the drill program.

The Company’s 15,000 metre (“m”) Phase 1 diamond drill program began in December with the first of at least two drill rigs arriving at Los Reyes. The Phase 1 program will allow for the first wireframed and integrated geological, structural and alteration model to be developed for Los Reyes and will serve as the framework for the exploration and expansion of the known deposits and the discovery of new deposits at Los Reyes.

Los Reyes – 2021 Exploration and Development Plans

The plans for 2021 include the following:

Add a second drill contractor in early January.

Expand the in-pit resources along strike and down dip. In addition, the drilling will infill areas to increase measured and indicated resources from inferred and provide silver assay data which is currently absent from parts of the historic reverse-circulation drill data.

Target deeper sections at Guadalupe East and other east extensions at depth for higher grade material, where drilling has yet to intersect the interpreted optimum boiling level stratigraphy for higher-grade portions of the deposits. It is believed that a significant opportunity exists to develop underground resource potential.

Target undrilled mineralized structures such as Fresnillo, Las Primas, Orito and newly identified structures proximal to Guadalupe. These structures offer both open pit and significant underground opportunities for resource expansion and discovery.

Increase access to new areas by re-habilitating existing access roads and trails.

Complete the Phase 1 drill program in the first half of 2021.

Re-model the Los Reyes deposit during the rainy season (June to October) and develop additional resource expansion targets.

Add infrastructure required at the project to support an expanded Phase II drill program starting in mid-October that focuses on both in-fill and resource expansion drilling.

Continue ongoing baseline survey work in support of the established project permitting process.

Continue our ongoing community engagement program.

Impact of Covid-19 on 2021 Plans

Prime has a focus on the importance of safety of our employees and the communities we operate in. To-date we have had minimal impact by the virus while we continue to take all reasonable measures to mitigate its potential impact and effects on our exploration and development activities. Covid-19 still has the potential to delay our plans, but we remain committed to the long-term safety of all our stakeholders including employees and host-communities.

Well-funded for 2021

With a cash balance of approximately C$7M, Prime ended 2020 well financed to continue with the current exploration plan into the second quarter of 2021. Additionally, the Company has a number of deeply in-the-money warrants, expiring in August 2021, that have the potential to provide an additional C$7M.

QA/QC Protocols and Sampling Procedures

Surface sampling is targeting wide outcropping zones of hard quartz bearing altered bedrock. In hand dug trenches, local shallow overburden is removed to expose the mineralized bedrock material. Sample collection consists of crews, using hammers and chisels, chipping continuous 1.5 m channels to produce approximately 8 to 10 kilograms of material for each 1.5 m sample interval. The larger rocks within the collected material are then broken with a hammer to homogenize them to a standard size. On a canvas mat the collected material is mixed, divided, and bagged. The bagged samples are then trucked to a lab for prep and assay. Similar samples are also collected from exposed road cuts and from open underground adit areas across mapped and unmapped structures. True widths of mineralized zones have not been calculated from the surface samples except where specified. Assay results range from below detection to 48.30 g/t gold and 1,250.0 g/t silver. Composite intervals use a cut-off grade of 0.2 g/t gold.

Quality control of the sampling program includes the insertion of reference standards and blanks as well as reject duplicate analysis to monitor the integrity of assay results. All samples are stored until picked up by Bureau Veritas Minerals and transported to its laboratory in Durango, Mexico. Samples are then dried, crushed, split and pulp samples are prepared for analysis. Gold is determined by fire assay with an atomic absorption spectroscopy (AAS) finish, and silver plus 34 other elements by multi-acid digestion and ICP finish, over-limits by fire assay and gravimetric finish. Bureau Veritas is an ISO/IEC accredited laboratory.

Kerry Sparkes, P.Geo., Executive Vice President of Exploration, is a qualified person for the purposes of National Instrument 43-101 and has reviewed and approved the technical content in this news release.