Entree Gold Reports on First Quarter 2013

Entree Gold Reports on First Quarter 2013 
VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 05/09/13 -- Entree
Gold Inc. (TSX:ETG)(NYSE MKT:EGI)(FRANKFURT:EKA) ("Entree" or the
"Company") has filed its interim operational and financial results
for the quarter ended March 31, 2013. 
Greg Crowe, President and CEO commented, "Entree successfully closed
an approximately $55 million financing package with Vancouver-based
Sandstorm Gold during the first quarter of this year. This financing
has provided Entree with strategic flexibility for existing and
future business operations. We are in a position of financial
strength and Entree's management and directors are committed to
striking a balance between cash management and the continuing
advancement of the Company's assets. The first quarter also saw us
initiate discussions with representatives of the Mongolian
Government, including the Ministry of Mines, as well as Oyu Tolgoi
stakeholders, in order to resolve the temporary restriction on the
transfer of the joint venture mining licences. In Nevada, we began
critical path baseline environmental studies at Ann Mason, and we
recently commenced a modest exploration program focused on high
priority targets that could further enhance the economics of the
Highlights for the quarter ended March 31, 2013 and beyond include: 
Sandstorm Gold Financing Package 
On February 15, 2013, Entree announced a comprehensive financing
package with Sandstorm Gold Ltd. ("Sandstorm") for gross proceeds of
approximately $55 million consisting of three key components: 

--  Equity participation and funding agreement providing a $40 million
    upfront deposit and ongoing payments from Sandstorm. Entree will use
    future payments received from its mineral property interests to purchase
    and deliver metal credits in amounts that are primarily indexed to
    Entree's share of gold and silver by-products and, to a lesser extent,
    copper production from the Company's joint venture property in Mongolia.
--  CAD$10 million private placement, completed on March 1, 2013, pursuant
    to which Entree issued 17,857,142 shares to Sandstorm at a price of
    CAD$0.56 per share. Sandstorm now holds approximately 12% of the issued
    and outstanding shares of Entree. 
--  $5 million payment for a 0.4% net smelter return ("NSR") royalty on the
    Ann Mason Project in Nevada.

The financing provides an endorsement of Entree's assets by a
sophisticated third party investor with a long term perspective while
limiting shareholder dilution and retaining a substantial majority of
the proceeds from future production. The funding also allows for the
advancement of the Company's key assets and the consideration of
future partnerships and other transactions that could enhance
shareholder value in the future. 
Mongolian Joint Venture Update 
On February 27, 2013, Entree received notification from the Mineral
Resources Authority of Mongolia ("MRAM") advising the Company that
the Entree - Oyu Tolgoi LLC ("OTLLC") joint venture mining licences
MV-15225A and MV-15226A have been put under a temporary
administrative suspension. The suspension extends only to the sale,
transfer or lease of the licences. The licences have not been revoked
or cancelled. Entree is in active and productive discussions to
resolve this temporary suspension. 
Technical Updates 
Lookout Hill, Mongolia 
On April 2, 2013, the Company filed an updated technical report
titled "Technical Report 2013 on the Lookout Hill Property"
("LHTR13") prepared under the management of AMC Consultants Pty Ltd
in Adelaide, Australia. The Company's updated technical report, dated
March 28, 2013, is available on SEDAR at www.sedar.com. 
LHTR13 discusses the impact of the updated mine plan on the
Entree-OTLLC joint venture property (the "Joint Venture Property") as
well as future development options for the Entree-OTLLC joint venture
assets. The underground mineral reserves for Lift 1 of the Hugo North
deposit, including Lift 1 of the Entree-OTLLC joint venture's Hugo
North Extension deposit, were updated. The probable reserve for Hugo
North Extension - Lift 1, effective March 25, 2013, totals 31 million
tonnes grading 1.73% copper and 0.62 grams per tonne ("g/t") gold. 
Highlights of LHTR13 include: 

--  NSR value of the Hugo North Extension - Lift 1 reserve increased to
    $95.21/tonne from the $79.40/tonne reported by the Company in March
    2012. The NSR calculation reflects the net value per tonne received for
    the ore by the mine after all treatment and transport costs and charges.
    Hugo North remains the most significant value driver for the Oyu Tolgoi
    mining project. 
--  The mineral reserve tonnage on the Joint Venture Property increased from
    27 million tonnes to 31 million tonnes compared to the amount previously
    reported in March 2012, while the copper grade decreased from 1.91% to
    1.73% and the gold grade decreased from 0.74 g/t to 0.62 g/t. 
--  After factoring in projected increases to capital expenditures and
    operating costs and a delay in production, the net present value (at an
    8% discount rate) of Entree's 20% interest in the Hugo North Extension -
    Lift 1 decreased to $110 million from the $129 million reported by the
    Company in March 2012. 
--  Underground development on Hugo North Extension is planned to commence
    in 2016, with Lift 1 development production commencing in 2019 and
    commercial production in 2023. 
--  At the new lower base case cut-off of 0.37% copper equivalent ("CuEq"),
    the inferred resource at the Heruga deposit has increased in size from
    910 million tonnes to over 1.8 billion tonnes. Concurrently, the grade
    has decreased to 0.38% copper, 0.36 g/t gold and 110 parts per million
    ("ppm") molybdenum from the previously reported base case of 0.48%
    copper, 0.49 g/t gold and 141 ppm molybdenum at a 0.6% CuEq cut-off. 
--  A significant portion of the mineralization on the Joint Venture
    Property has not been included in the updated mining plan and remains in
    the mineral resource category, including the Hugo North Extension - Lift
    2 and the Heruga deposit. 
--  Expansion alternatives are under consideration and an updated Phase 2
    feasibility study is expected by mid-2014. Further design work and
    optimization may result in changes to the joint venture development
    schedule that could bring joint venture production forward relative to
    the current plan.

LHTR13 uses the same mineral resource estimates previously reported
in the Company's March 2012 technical report. The base case CuEq
assumptions for each deposit were determined using operating cost
estimates from the mineral reserves and from mining operations
exploiting similar deposits. 
Oyu Tolgoi Project Development 
In December 2012, the Oyu Tolgoi concentrator was commissioned and
first copper-gold concentrate was produced in January 2013. OTLLC is
on schedule for first commercial production from its Southern Oyu
open pits in mid-2013, subject to resolution of certain issues
between the Government of Mongolia, OTLLC and Rio Tinto. 
On March 25, 2013, Turquoise Hill Resources Ltd. ("Turquoise Hill")
announced that project financing for the Oyu Tolgoi mining project
continues to progress with the boards of the European Bank of
Reconstruction and Development and the International Finance
Corporation approving their respective participation in late
February. Bids have been received from a number of banks that would
allow Turquoise Hill to achieve its project financing target of $3
billion to $4 billion and discussions are ongoing with the lenders to
finalize the terms of those offers. Turquoise Hill anticipates the
closing of final binding documentation and project financing funding
to occur by mid-2013. 
Ann Mason, Nevada 
Entree's other principal asset is the Ann Mason Project located in
the Yerington District of Nevada. 
With the completion of a positive preliminary economic assessment
("PEA") in October 2012, Entree is now evaluating the most efficient
way of advancing the Ann Mason Project. Entree has commenced a modest
exploration program focused on high priority targets that could
enhance the economics of the project. The program includes limited
additional drilling, particularly to the north and west of the Ann
Mason deposit to extend the mineralization within the current pit
design and reduce the waste-to-mineralization strip ratio. The
current drilling program also includes holes to test near-surface
oxide copper targets southwest of Ann Mason, between Ann Mason and
Blue Hill and west of the existing Blue Hill resource. 
Permitting is underway for the purpose of amending the existing Ann
Mason Plan of Operations to allow drill testing of high priority
exploration targets located on the Ann Mason property. These include
the Blackjack IP and oxide copper targets and Roulette. Entree has
begun critical path environmental baseline studies including
wildlife, biology, archaeology and hydrology on portions of the Ann
Mason property where the PEA envisions placement of mine facilities
and infrastructure. 
Corporate Highlights 
For the three months ended March 31, 2013, the Company incurred a net
loss of $5,091,844 ($0.04 per share) compared to a net loss of
US$5,074,832 ($0.04 per share) for the three months ended March 31,
2012. During the three months ended March 31, 2013, Entree incurred
slightly higher operating expenditures, due to increased general and
administrative expenses relative to the three months ended March 31,
2012. This increase is primarily attributable to consultancy and
advisory and legal fees associated with closing of the Sandstorm
transaction and increased personnel expenses. These operating
expenses were partially offset by decreased exploration expenses on
the Ann Mason Project and a decreased loss from the Entree-OTLLC
joint venture resulting in decreased losses from equity investee. 
Peter Meredith has advised the Company of his decision not to stand
for re-election at the Company's upcoming Annual General Meeting. The
Company thanks Mr. Meredith for his years of service on Entree's
Board of Directors and wishes him well in his future endeavours. 

                                  As at March 31, 2013  As at March 31, 2012
                                                 (US$)                 (US$)
Working capital(1)                          55,119,275            14,344,275
Total assets                               108,672,304            73,075,875
Total long term liabilities:                                                
  Deferred Revenue                          39,417,092                     -
  Other                                     15,137,842            13,371,913
 (1)  Working Capital is defined as Current Assets less Current Liabilities 

All currency in this news release is in US dollars unless otherwise
noted. The Company's Interim Financial Statements and accompanying
management's discussion and analysis for the quarter ended March 31,
2013 and its Annual Information Form for the year ended December 31,
2012 are available on the Company website, on SEDAR at www.sedar.com
and on EDGAR at www.sec.gov. 
Robert Cann, P.Geo., Entree's Vice-President Exploration, a Qualified
Person as defined by NI 43-101, has approved the technical
information in this release. 
Entree Gold Inc. is a Canadian mineral exploration company balancing
opportunity and risk with key assets in Mongolia and Nevada. As a
joint venture partner with a carried interest on a portion of the Oyu
Tolgoi mining project in Mongolia, Entree has a unique opportunity to
participate in one of the world's largest copper-gold projects
managed by one of the premier mining companies - Rio Tinto. Oyu
Tolgoi, with its series of deposits containing copper, gold and
molybdenum, has been under exploration and development since the late
Additionally, Entree has been advancing its Ann Mason Project in one
of the world's most favourable mining jurisdictions, Nevada. The Ann
Mason Project hosts the Ann Mason copper-molybdenum deposit as well
as the Blue Hill copper deposit within the rejuvenated Yerington
copper camp. 
Sandstorm, Rio Tinto and Turquoise Hill are major shareholders of
Entree, holding approximately 12%, 11% and 9% of issued and
outstanding shares, respectively. 
This News Release contains forward-looking statements and
forward-looking information (together, "forward-looking statements")
within the meaning of applicable securities laws and the United
States Private Securities Litigation Reform Act of 1995, with respect
to the future prices of copper, gold, molybdenum and silver; the
estimation of mineral reserves and resources; the realization of
mineral reserve and resource estimates; future mineral production;
costs of production and capital expenditures; the availability of
project financing; future cash flows; the potential development of
future phases of the Oyu Tolgoi mining project, including Lift 1 and
Lift 2 of the Hugo North Extension deposit and the Heruga deposit;
statements concerning the expected timing of initial production from
Lift 1 of the Oyu Tolgoi block underground cave mine; discussions
with third parties regarding material agreements; potential actions
by the Government of Mongolia with respect to the Shivee Tolgoi and
Javhlant mining licences and the Company's interest in the Joint
Venture Property; statements regarding the expected release date of
the feasibility study for the Oyu Tolgoi mining complex; potential
size of a mineralized zone; potential expansion of mineralization;
potential discovery of new mineralized zones; the timing and results
of future resource and reserve estimates; potential types of mining
operations; government regulation of exploration and mining
operations; potential metallurgical recoveries and grades; plans for
future exploration and/or development programs and budgets;
permitting time lines; anticipated business activities; corporate
strategies; requirements for additional capital; uses of funds;
proposed acquisitions and dispositions of assets; and future
financial performance. In certain cases, forward-looking statements
and information can be identified by the use of words such as
"plans", "expects" or "does not expect", "is expected", "budgeted",
"scheduled", "estimates", "forecasts", "intends", "anticipates", or
"does not anticipate" or "believes" or variations of such words and
phrases or statements that certain actions, events or results "may",
"could", "would", "might" "will be taken", "occur" or "be achieved".
While the Company has based these forward-looking statements on its
expectations about future events as at the date that such statements
were prepared, the statements are not a guarantee of Entree's future
performance and are subject to risks, uncertainties, assumptions and
other factors which could cause actual results to differ materially
from future results expressed or implied by such forward-looking
statements and information. Such factors and assumptions include,
amongst others, that the size, grade and continuity of deposits and
resource and reserve estimates have been interpreted correctly from
exploration results;
that the results of preliminary test work are indicative of what the
results of future test work will be; that the prices of copper, gold,
molybdenum and silver will remain relatively stable; the effects of
general economic conditions, changing foreign exchange rates and
ions by Rio Tinto, Turquoise Hill and/or OTLLC and by government
authorities including the Government of Mongolia; the availability of
capital; that applicable legislation, including legislation with
respect to mining, foreign investment, royalties and taxation, will
not materially change; uncertainties associated with legal
proceedings and negotiations; and misjudgements in the course of
preparing forward-looking statements. In addition, there are also
known and unknown risk factors which may cause the actual results,
performances or achievements of Entree to be materially different
from any future results, performance or achievements expressed or
implied by the forward-looking statements and information. Such
factors include, among others, risks related to international
operations, including legal and political risk in Mongolia; risks
associated with the conduct of joint ventures; recent global
financial conditions; actual results of current exploration
activities; changes in project parameters as plans continue to be
refined; inability to upgrade inferred mineral resources to indicated
or measured mineral resources; inability to convert mineral resources
to mineral reserves; conclusions of economic evaluations; future
prices of copper, gold, silver and molybdenum; possible variations in
ore reserves, grade recovery and rates; failure of plant, equipment
or processes to operate as anticipated; accidents, labour disputes
and other risks of the mining industry; delays in obtaining
government approvals, permits or licences or financing or in the
completion of development or construction activities; environmental
risks; title disputes; limitations on insurance coverage; as well as
those factors described in the Company's Annual Information Form for
the financial year ended December 31, 2012, dated March 28, 2013
filed with the Canadian Securities Administrators and available at
www.sedar.com. Although the Company has attempted to identify
important factors that could cause actual actions, events or results
to differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events or
results not to be as anticipated, estimated or intended. There can be
no assurance that forward-looking statements will prove to be
accurate, as actual results and future events could differ materially
from those anticipated in such statements. Accordingly, readers
should not place undue reliance on forward-looking statements. The
Company is under no obligation to update or alter any forward-looking
statements except as required under applicable securities laws.
Entree Gold Inc.
Monica Hamm
Manager, Investor Relations
604-687-4777 or Toll Free: 866-368-7330
604-687-4770 (FAX)
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