Entree Gold Announces Fiscal Year 2013 Results and Reviews Corporate Highlights

Entree Gold Announces Fiscal Year 2013 Results and Reviews Corporate Highlights 
VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 03/27/14 --  Entree
Gold Inc. (TSX: ETG)(NYSE MKT: EGI)(FRANKFURT: EKA) ("Entree" or the
"Company") has today filed its annual operational and financial
results for the year ended December 31, 2013. The Company's Annual
Report on Form 20-F has been filed with the SEC, and is available on
the Company website. Shareholders can receive a free hard copy of the
Company's audited Annual Financial Statements upon request. All
dollar figures in this news release are in United States currency
unless otherwise noted. 
Greg Crowe, President and CEO commented, "With the completion of our
financing in early 2013, Entree substantially added to its treasury,
thus enabling us to focus on growth, rather than simply surviving.
During these challenging economic times, opportunities are created
for those companies that can operate from a position of financial
strength. Entree has continued to focus operationally on our core
projects while also assessing other initiatives that have the
potential to deliver long term value to our shareholders." 
"Concurrently, we have maintained ongoing dialogue with the
Government of Mongolia in relation to the joint venture property,
held in concert with Oyu Tolgoi LLC, which forms an integral part of
the planned underground block cave operations at Oyu Tolgoi. We
continue to advance discussions with the Government of Mongolia, and,
while no definitive agreements have been finalized, we are continuing
to make constructive progress." 
Highlights for the year ended December 31, 2013 and subsequent
developments through March 27, 2014 include: 
Mongolia  
Oyu Tolgoi Project Update 
Entree has a carried joint venture interest in two of the Oyu Tolgoi
copper-gold deposits in Mongolia - the Hugo North Extension and the
Heruga deposits. The remaining deposits are held by Entree's joint
venture partner, Oyu Tolgoi LLC ("OTLLC") (66% Turquoise Hill
Resources Ltd.; 34% Government of Mongolia). Phase 1 (Southern Oyu
open pits) is in commercial production and Phase 2 (Lift 1 of the
underground block cave mining operation, which includes a portion of
the Hugo North Extension deposit) scheduled for development by Rio
Tinto.  


 
 
--  First ore from the Phase 1 open pits at Oyu Tolgoi was processed through
    the concentrator on January 2, 2013 and production of the first copper-
    gold concentrate followed on January 31, 2013. Turquoise Hill announced
    that the first shipment of copper concentrate left the Oyu Tolgoi open
    pit mine for customers in China on July 9, 2013.  
    
--  On July 28, 2013, Turquoise Hill announced that funding and development
    of the Oyu Tolgoi underground mine will be delayed until outstanding
    matters with the Mongolian Government can be resolved and a new
    timetable has been agreed. On August 13, 2013, underground development
    was suspended. 
    
--  On September 1, 2013, the Oyu Tolgoi mine achieved Commencement of
    Production as defined in the October 2009 Investment Agreement ("OTIA")
    between Turquoise Hill, Rio Tinto, OTLLC and the Government of Mongolia.
    
--  On October 14, 2013, Turquoise Hill reported that the concentrator was
    operating at name-plate capacity of approximately 100,000 tonnes of ore
    processed per day. The necessary approvals from Chinese customs
    officials to allow customers to collect purchased concentrate were
    received in October and a convoy carrying concentrate departed from the
    Chinese-border warehouse on October 19, 2013. 
    
--  Turquoise Hill reiterated in March 2014 that the feasibility study for
    the expansion of operations at the Oyu Tolgoi mine is ongoing. This
    study is expected to be complete within the first half of 2014. Once
    complete, it must be approved by OTLLC shareholders as well as the
    Mongolian Minerals Council. 
    
--  Turquoise Hill provided an update on discussions with the Government of
    Mongolia on March 26, 2014. Negotiations between all parties involved
    are continuing with the aim of resolving a number of outstanding
    shareholder issues and progressing project financing. Further delays may
    occur if the outstanding issues are not resolved before the expiration
    of lender commitments on existing project finance arrangements. 

Entree - OTLLC Joint Venture  


 
 
--  On February 27, 2013, notice (the "Notice") was delivered to Entree by
    the Mineral Resources Authority of Mongolia that the Ministry of Mining
    had cancelled the July 10, 2009 Order of the Ministry of Mineral
    Resources and Energy registering the Hugo Dummett (including the Hugo
    North Extension) and Heruga reserves. The Notice further advises that
    any transfer, sale or lease of the Shivee Tolgoi and Javhlant mining
    licences is temporarily restricted.
    
    The Company was subsequently advised that the temporary transfer
    restriction would be lifted and that the reserves for the joint venture
    deposits would stand as originally presented.
    
 
--  Entree has been in discussions with stakeholders of the Oyu Tolgoi
    project, including the Government of Mongolia, OTLLC, Erdenes Oyu Tolgoi
    LLC, Erdenes MGL LLC and Rio Tinto, since the Government of Mongolia
    temporarily restricted the joint venture licences from transfer in
    February 2013. The discussions to date have focussed on issues arising
    from Entree's exclusion from the OTIA, including the fact that the
    Government of Mongolia does not have a full 34% interest in the joint
    venture property; the fact that the mining licences integral to future
    underground operations are held by more than one corporate entity; and
    the fact that Entree does not benefit from the stability that it would
    otherwise have if it were a party to the 2009 OTIA. Meetings to discuss
    possible ways of addressing all parties' concerns in a mutually
    satisfactory manner have been positive and constructive. No final
    agreements have been reached and further discussions with all
    stakeholders are required. 
    
--  An updated mining plan based on reserves only and derived from the
    latest OTLLC technical, production and cost data was released by
    Turquoise Hill in March 2013. Entree filed a separate technical report
    dated March 28, 2013, which discusses the impact of the updated mine
    plan on the Entree-OTLLC joint venture property.  

USA 
Ann Mason, Nevada 
The Ann Mason Project is Entree's most advanced project outside of
Mongolia. With the completion of a positive Preliminary Economic
Assessment in late 2012, Entree is now evaluating the most efficient
and effective way of advancing the Ann Mason Project through
pre-feasibility and feasibility. Future programs will also focus on
priority exploration targets that could enhance Ann Mason Project
economics. In addition, the Company is considering strategic
partnerships, joint ventures and similar arrangements that would help
facilitate the development of the project.  
In the third quarter of 2013, the Company completed a combined core
and reverse circulation ("RC") drilling program. The drilling
targeted the Ann Mason and Blue Hill deposits and new exploration
targets located nearby. Drilling included approximately 4,755 metres
of core and RC drilling, of which 3,333 metres were drilled in seven
holes at Ann Mason and 1,422 metres were drilled in 11 holes at Blue
Hill.  
Drilling results from 2013 enhanced our understanding of the geometry
and potential of the Ann Mason and Blue Hill deposits. Three of the
five core holes drilled at Ann Mason extended copper mineralization
190 metres to 250 metres northwest and northeast of the deposit and
within the current pit design. In addition, Ann Mason mineralization
remains open in several directions and future drilling programs will
be needed to test this potential. Two shallow, widely-spaced RC holes
(totalling 180 metres) were also completed about 500 metres to 900
metres west of Ann Mason to test a new, near-surface oxide copper
target. Holes EG-AM-13-038 and 039 encountered narrow intervals of
0.16% - 0.20% oxide copper within strong, quartz-sericite-pyrite
alteration. Deeper sulphide potential below these holes remains
untested.  
The 2013 drilling at Blue Hill successfully tested for westward
extensions of the current deposit and also highlighted the structural
complexity of the Blue Hill area. To the east, oxide and mixed
mineralization is truncated by the low angle Blue Hill Fault,
however, underlying sulphide mineralization continues in this
direction. Drilling of the underlying sulphide target remains very
widely-spaced, but has identified a target area more than one
kilometre in width, which remains open in most directions.
Significant molybdenum mineralization was also intersected in two of
the drill holes targeting the sulphide mineralization. Most recent
drill holes were targeted to test oxide mineralization; however, two
diamond holes (EG-BH-11-019 and -021) were drilled east of the oxide
copper zone to test deeper sulphide copper potential. In addition,
hole EG-BH-11-031, located approximately one kilometre east of Blue
Hill, intersected a near-surface zone of copper-oxide mineralization
assaying an average of 0.28% copper over 13.8 metres from a depth of
22.2 metres. Further drilling will be required in this area and if
successful could provide additional feed for a potential SX/EW
operation. 
A program of 31 line kilometres of in-fill induced polarization
("IP") geophysics was completed in June 2013. This work was
successful in better defining the Blackjack IP anomaly and in
defining a strong chargeability feature to the west of Blue Hill.
This new chargeability feature represents a significant expansion of
the IP anomaly that contains the Ann Mason and Blue Hill deposits. 
Baseline environmental studies commenced in the second quarter of
2013 and are continuing. These studies include wildlife, biology,
archaeology and cultural surveys which will be used to expand the
area covered under the existing Plan of Operations. Studies were
largely complete at the end of 2013, except for minor additional
cultural and raptor field surveys. 
Other Projects  
Lukkacha, Peru 
Entree has a conditional agreement with a private Peruvian company
whereby Entree may acquire up to a 100% interest in the Lukkacha
property located in Tacna Province of southeastern Peru. The property
is situated within 50 kilometres of the international border with
Chile, and initiation of work is subject to Entree obtaining a
Supreme Decree allowing it to work on the property. 
A joint military inspection took place on September 12, 2013 with
Entree personnel accompanying the military team. The military
commander submitted a favourable written opinion to the General
Secretary of the Ministry of Defense on September 15, 2013. The
opinion now requires signatures of the Minister of Defense and
Minister of Energy and Mines, and of the President and Prime
Minister.  
The property consists of seven concessions totaling 4,400 hectares
which cover two large areas of surface alteration, iron oxides and
quartz veining indicative of porphyry-style mineralization, located
approximately 50 kilometres along the structural trend southeast from
the giant Toquepala mining operation of Grupo Mexico. The property
has never been drilled and represents a unique opportunity for early
stage exploration within an under-explored major copper district. 
Australia 
The Blue Rose copper-iron-gold-molybdenum joint venture property is
located in the Olary Region of South Australia, 300 kilometres
north-northeast of Adelaide. Magnetite iron formations occur in the
southern portion of this 1,000 square kilometre tenement, and a zone
of copper oxide mineralization and a gold target (Golden Sophia) are
located in the north-central area of the tenement.  
In August 2013, the Company entered into an agreement to transfer the
iron ore rights on the Blue Rose joint venture property and in
October 2013, Entree received A$475,778 as consideration for the
transfer of the iron ore rights, with an additional A$475,778 payable
in October 2014.  
Other Corporate Highlights 


 
 
--  A comprehensive financing package with Sandstorm Gold Ltd. was announced
    on February 15, 2013. The financing package consisted of three key
    components: 
    
    --  Equity participation and funding agreement ("Funding Agreement")
        with a US$40 million upfront deposit and ongoing payments from
        Sandstorm. In return, Entree will use future payments that it
        receives 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 interest in Mongolia. 
        
    --  CAD$10 million private placement pursuant to which Entree issued
        17,857,142 shares to Sandstorm at a price of CAD$0.56 per share. 
        
    --  US$5 million payment for a 0.4% net smelter return royalty on the
        Ann Mason and Blue Hill deposits in Nevada. 
        
--  On June 27, 2013, shareholders confirmed an alteration to the Company's
    Articles to add advance notice provisions, for the purpose of providing
    shareholders, directors and management of Entree with a clear framework
    for nominating directors. 
    
--  The Rt. Honourable Lord Howard of Lympne was appointed non-executive
    Chairman of the Company's Board of Directors on June 27, 2013. James
    Harris was appointed non-executive Deputy Chairman. 
    
--  Lindsay Bottomer retired from his role as Vice President Business
    Development with the Company, effective December 31, 2013. 

Greg Crowe, President and CEO of Entree, noted, "Lindsay has been an
integral part of Entree's growth over the past 11 years, both in his
capacity as director and as an officer of the Company. His breadth of
technical knowledge and considerable expertise has been invaluable to
our team. We are pleased he has remained on as a director of the
Company."  
Following Mr. Bottomer's retirement, the Company was pleased to
promote Mr. Robert Cinits to the position of Vice President,
Corporate Development with the Company, effective January 1, 2014. 
For the year ended December 31, 2013, the Company incurred a net loss
of US$11,422,025 (US$0.08 per share) compared to a net loss of
US$15,196,129 (US$0.12 per share) for the year ended December 31,
2012. The decrease in net loss is due to lower operating
expenditures, primarily from decreased exploration expenses on the
Ann Mason Project. Other factors that contributed to lower operating
expenditures include higher foreign exchange gains and a decreased
loss from the Entree-OTLLC joint venture property. These lower
operating expenditures were partially offset by higher general and
administration and higher consultancy and advisory fees related
primarily to expenditures associated with the Sandstorm financing and
ongoing efforts to resolve Mongolian contractual matters. As at
December 31, 2013, the Company had working capital of US$46,394,496,
including cash of US$46,701,216. 
SELECTED FINANCIAL INFORMATION 


 
 
-----------------------------------------------------------------------
-----
                                                                            
                          As at December 31, 2013    As at December 31, 2012
                                            (US$)                      (US$)
----------------------------------------------------------------------------
Working capital (1)                    46,394,496                  4,699,256
Total assets                           97,395,105                 64,173,530
Total long term                                                             
 liabilities (2)                       50,956,860                 15,286,041
----------------------------------------------------------------------------
                                                                            
(1) Working Capital is defined as Current Assets less Current Liabilities.  
(2) Increase in long term liabilities primarily due to recording of         
Sandstorm $40 million equity participation and funding agreement Deposit as 
deferred revenue.                                                           

The Company's Annual Financial Statements, management's discussion and
analysis ("MD&A") and Annual Information Form are available on the
Company website, on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov. 
QUALIFIED PERSON  
Robert Cann, P.Geo., Entree's Vice-President, Exploration, a
Qualified Person as defined by National Instrument 43-101, has
approved the technical information in this release.  
ABOUT ENTREE GOLD INC.  
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
1990s.  
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 Gold, Rio Tinto and Turquoise Hill Resources are major
shareholders of Entree, holding approximately 12%, 11% and 9% of
issued and outstanding shares, respectively.  
This news release contains forward-looking statements within the
meaning of the United States Private Securities Litigation Reform Act
of 1995 and forward-looking information within the meaning of
applicable Canadian securities laws. 
Forward-looking statements include, but are not limited to,
statements with respect to future mineral production; the
availability of project financing; the potential impact of future
exploration results on Ann Mason mine design and economics; the
potential development of future phases of the Oyu Tolgoi project,
including Lift 1 of the Hugo North Extension deposit; discussions
regarding Entree's interest in the joint venture property, the joint
venture licences and material agreements; potential actions by the
Government of Mongolia with respect to the Shivee Tolgoi and Javhlant
mining licences; the resolution of outstanding issues between the
Government of Mongolia, Entree, Rio Tinto and Turquoise Hill;
potential size of a mineralized zone; potential expansion of
mineralization; plans for future exploration and/or development
programs and budgets; anticipated business activities; corporate
strategies; requirements for additional capital; 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; the
effects of general economic conditions, changing foreign exchange
rates and actions by Rio Tinto, Turquoise Hill and/or OTLLC and by
government authorities including the Government of Mongolia; the
impact of the decision announced by Turquoise Hill to delay the
funding and development of the Oyu Tolgoi underground mine pending
resolution of outstanding issues with the Government of Mongolia and
the costs which could result from delays; 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 changes in the attitudes of the
governments to foreign investment; risks associated with the conduct
of joint ventures; recent global financial conditions; changes in
project parameters as plans continue to be refined; conclusions of
economic evaluations; future prices of copper, gold, silver and
molybdenum; 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 discussed
in the section entitled "Risk" in the Company's most recently filed
Management's Discussion and Analysis and in the Company's Annual
Information Form for the financial year ended December 31, 2013,
dated March 27, 2014 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 and information, 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 and information will prove to be accurate,
as actual results and future events could differ materially from
those anticipated in such statements and information. Except as
required under applicable securities legislation, the Company
undertakes no obligation to publicly update or revise forward-looking
statements and information, whether as a result of new information,
future events, or otherwise. Accordingly, readers should not place
undue reliance on forward-looking statements and information. 
Contacts:
Entree Gold Inc.
Monica Hamm
Manager, Investor Relations
604-687-4777 or Toll Free: 866-368-7330
604-687-4770 (FAX)
mhamm@entreegold.com
www.entreegold.com
 
 
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