Erdene’s Bayan Khundii Gold Mine Reaches Commercial Production in Mongolia

Erdene Resource Development has moved Bayan Khundii beyond start-up and into commercial production, marking one of Mongolia’s more important new gold mine openings in a district still carrying substantial exploration optionality.

The mine produced and sold 8,527 ounces of gold and 3,135 ounces of silver in the first quarter of 2026, generating US$42 million in gross project revenue. Plant performance has moved quickly through commissioning, with Bayan Khundii operating at 94% of target throughput, processing 151,000 tonnes of ore at an average of 1,675 tonnes per day and achieving gold recoveries of 96%, above the feasibility forecast average of 93%. 

The operating result gives substance to a project that has travelled quickly from discovery to production. Erdene’s project materials describe Bayan Khundii as a near-surface, high-grade open-pit mine in southwestern Mongolia, located within the Khundii Minerals District and owned through Erdene Mongol LLC, a joint venture between Erdene and Mongolian Mining Corporation. 

Bayan Khundii’s reserve base supports a compact but high-margin operating model. The project page lists total gold reserves of 513,700 ounces at an average head grade of 4.0 g/t gold, including the Dark Horse satellite deposit, with expected annual production of approximately 85,000 ounces of gold. The broader licence package gives the operation district-scale relevance, with the Bayan Khundii mining licence covering 2,309 hectares and holding a 30-year initial term that can be extended to 70 years. 

The immediate growth angle is near-mine drilling. More than 5,000 metres of drilling has tested Dark Horse and Altan Arrow, with Dark Horse South returning near-surface high-grade intersections including 9 g/t gold over 19 metres and 28.7 g/t gold over 3 metres. That drilling is strategically important because Bayan Khundii is already operating; new oxide or transitional feed within trucking distance can move into mine planning with greater speed than a standalone discovery. 

Mongolia’s mining sector is still dominated internationally by copper, coal and the Oyu Tolgoi complex. Bayan Khundii’s commercial production milestone broadens that picture by adding a new gold producer with domestic bullion sales into the Central Bank of Mongolia and a clear pathway to resource extension around the initial mine footprint.