Ivanhoe Mines Commences Drilling of Shallow IP Target at Copper Flats, Mongolia
January 25, 2005
Vancouver, B.C., Tuesday, January 25, 2005 - Entrée Gold Inc. (TSX-V: ETG – "Entrée" or the "Company") announces that Ivanhoe Mines Ltd. (NYSE: IVN; TSX: IVN; ASX: IVN – "Ivanhoe") has commenced drilling of a secondary, relatively shallow Induced Polarization ("IP") target in the Copper Flats area of Entrée's 100% owned Lookout Hill property, Mongolia. The target is located within the "Project Property" as defined in the October 2004 Equity Participation and Earn-in Agreement ("Earn-In Agreement") between Entrée and Ivanhoe.
The shallow IP target is located approximately two kilometers west of the deeper IP target that defines the potential northward projection of the Hugo Dummett Deposit. Drilling of the potential extension of the Hugo Dummett Deposit onto Lookout Hill will not commence until larger-capacity drills become available. Ivanhoe is currently drilling systematic northward step-outs along the Hugo Dummett Deposit approximately 150 meters south of the Ivanhoe – Entrée property boundary.
"Large porphyry deposits often host satellite zones of mineralization that could contain significant economic concentrations of mineralization", said Greg Crowe, Entrée's President and CEO. "The selection of this secondary IP target as Ivanhoe's first drill test of the Copper Flats area is due principally to the current availability of smaller-capacity drills. The results of this drill program will have no impact on the along-strike potential of the Hugo Dummett Deposit itself".
Since November 2004, Ivanhoe has been conducting a deep-probing IP geophysical survey over Entrée's Copper Flats area. As reported in Ivanhoe's news release of December 6, 2004, this work has outlined a four kilometer extension to the Hugo Dummett IP signature onto Entrée's Lookout Hill property. In this preliminary survey, several other sizeable chargeability anomalies were also identified. Of particular note was a more than three kilometer long, north-northeast trending, and relatively shallow IP anomaly located approximately two kilometers west of the northward projection of the Hugo Dummett Deposit. Follow-up detailed IP section work, conducted since mid-December 2004, has better defined these chargeability anomalies to depth and along strike. The initial drill hole, which has been collared on the eastern side of this western anomaly less than 100 meters north of the joint Ivanhoe – Entrée property boundary, will test this IP target to a vertical depth of approximately 750 meters.
Under the Earn-In Agreement, Ivanhoe has the right to earn an interest in approximately 22% (40,000 hectares) of Entrée's Lookout Hill property, Mongolia. Ivanhoe must spend a minimum of US$3 million in order to secure surface-rights to the "Project Property" and must spend a minimum of US$20 million in order to earn a 51% interest in the Project Property. Ivanhoe can acquire up to an 80% interest in mineralization below a depth of 560 metres by spending a total 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.
Mr. Crowe noted that Entrée is well financed, with approximately CDN$7 million in its treasury, allowing it to explore the remaining 78% of its Lookout Hill property, including the Zone I/II, Zone III and Bayan Ovoo areas. Exploration of its wholly owned Ulziit Uul property, located in the Kharmagtai area approximately 100 kilometers to the north of Lookout Hill, will also be undertaken.
Robert Cann, Entrée's Exploration Manager, a qualified person as defined by National Instrument 43-101, supervised the preparation of the information in this release.
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% royalty-free ownership in the 179,590 hectare Lookout Hill (Shivee Tolgoi) property which completely surrounds Ivanhoe Mines' 8,500 hectare Turquoise Hill (Oyu Tolgoi) holdings. Entrée has an earn-in agreement with Ivanhoe Mines covering approximately 22% (approximately 40,000 hectares) of Lookout Hill. The Company trades on the TSX Venture Exchange under the symbol "ETG".
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. Forward-looking statements in this news release include those concerning the Company's belief that the drilling program of Ivanhoe on the Company's property may discover a host satellite zone of Oyu Tolgoi porphyry related mineralization.
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.