Erdene Announces Q2 2026 Results
Erdene’s Q2 gold output rose 37% as grades and recoveries exceeded plans, while the Zuun Mod PEA was delayed to mid-2024.
Erdene Resource Development Corporation (ERD) released its Q2 2026 earnings and operating update for the three months ended June 30, 2026. The Bayan Khundii Gold Mine produced and sold 11,709 oz of gold and 3,317 oz of silver during the quarter. This represents a 37% increase in gold production compared to Q1 2026. The company processed 153,000 tonnes of ore, averaging 1,682 tonnes per day. The average feed grade was 2.4 g/t gold, approximately 25% higher than in the first quarter. Gold recovery averaged 96%, exceeding the planned 93%.
Financial results for the period showed total gross revenue of US$53 million, or C$75 million, against a total cost of revenue of US$24 million, or C$33 million. Erdene reported a net income of C$9,993,000, a reversal from the net loss of C$4,122,000 recorded in Q2 2025. Income from investment in associate, representing the company’s joint venture interest in Erdene Mongol LLC, was C$11,201,000, compared to a loss of C$2,995,000 in the same period last year. Erdene realized weighted average prices of US$4,493/oz for gold and US$72/oz for silver.
On the exploration front, the Zuun Mod Preliminary Economic Assessment (PEA) has advanced, with results now expected in mid-H2 2026. The maiden drill program at Tereg Uul was completed, consisting of 11 holes totaling 2,710 metres. The Tereg Uul Web prospect intersected anomalous gold, with grades over 0.1 g/t Au and up to 1 g/t Au, and silver up to 15 g/t Ag, along a 1.5 km mineralized structure. Deeper drilling at Tereg Uul intersected a coal seam within 150 metres of surface and traces of native copper. The Tereg Uul option was extended for another year, requiring a US$400,000 payment in July.
Erdene launched a Normal Course Issuer Bid on June 30, 2026, permitting the purchase of up to 4,900,000 common shares. To date, the company has repurchased and cancelled 94,400 shares at an average price of C$5.21. Most Q2 production and revenue figures were previously disclosed in the July 22, 2026 operations update; this release adds financial details, cost breakdowns, resource estimate updates, NCIB status, and the PEA timing update.
Erdene Resource Development Corporation reported a 37% quarter-over-quarter increase in Q2 production, driven by higher feed grade and recovery rates that exceeded feasibility expectations. The company recorded C$9.99 million in net income, a significant improvement from the C$4.76 million net income in Q1 2026 and the prior-year loss. At the mine level, total cost of revenue was US$24 million against US$53 million of revenue, implying a project-level gross margin of approximately US$29 million, or roughly 55%. Additionally, the company announced a share buyback program.
The headline operating numbers were pre-released on July 22, 2026, allowing the market time to absorb the production beat prior to this update. Erdene holds a 50% economic interest in Bayan Khundii through EM, meaning company-level revenue remains zero, with income arriving through the investment in associate line. While production increased, the Q2 realized gold price was US$4,493/oz, down from Q1’s US$4,872/oz; the production and revenue beat was attributable to volume and grade rather than price.
Throughput reached 1,682 tpd, which is approximately 94% of the target and below the eventual 1,950 tpd design referenced in earlier updates. Annualizing Q2 output yields roughly 46,800 oz, remaining well below the roughly 85,000 oz/yr nameplate target. Regarding development timelines, the Zuun Mod PEA is now described as mid-H2 2026, shifting from earlier “mid-2026” or “Q3 2026” language. This represents a timeline adjustment rather than an acceleration.
Results from Tereg Uul remain in the early stages and are modest, featuring anomalous gold and silver, a coal seam, and only traces of native copper. These findings do not yet constitute a discovery of clear economic significance.
Erdene Resource Development Corporation, a Canada-based resource company focused on Mongolia, trades on the TSX under ERD, the Mongolian Stock Exchange under ERDN, and OTCQX under ERDCF. Its flagship asset is the Bayan Khundii Gold Mine in southwestern Mongolia, operated by Erdene Mongol LLC, a 50:50 joint venture with Mongolian Mining Corporation. The mine achieved its first gold pour on September 14, 2025, with commercial production targeted for Q1 2026.
Project materials report total probable gold reserves of 513,700 oz at an average grade of about 4.0 g/t, including the Dark Horse satellite deposit. A feasibility study contemplates about 650,000 tpa throughput and approximately 85,000 oz Au/yr at full nameplate capacity. Production figures show 8,527 oz of gold sold in Q1 2026 and 11,709 oz in Q2 2026, bringing cumulative production since the first pour to 27,670 oz.
The company’s portfolio includes other assets such as Dark Horse, a satellite gold deposit for Bayan Khundii, and the Altan Nar gold-silver-lead-zinc exploration project. The Ulaan gold discovery near Bayan Khundii has a maiden resource estimate currently being prepared. The Zuun Mod molybdenum-copper porphyry deposit holds updated M&I resources of 333 Mlb Mo and 384 Mlb Cu, with a PEA expected in mid-H2 2026. Nearby, the Khuvyn Khar copper porphyry target includes an earlier intercept of 30 m at 1.25% Cu. Additionally, the Tereg Uul optioned copper-gold porphyry prospect is located about 10 km southwest of Oyu Tolgoi. The provided materials do not disclose whether the projects carry royalties or are royalty-free.