Asmara Geocongress Journal

2011

- Facts on Eritrea - A message fom His Exellency the Minister - About the Ministry of Energy and Mines - Highlights of 2010-2011 - Mining Law - Geology of Eritrea - Mineral potential of Eritrea - Current mining activities and future investment opportunities Produced by:- A Message From Ministry of Energy and Mines The Minister © 2011 Ministry of Energy and Mines

For further information contact:-

Ministry of Energy and Mines P.O.Box 5285 Asmara, Eritrea Dear Reader, Tel:- +291 1 116872/127944 Fax:- +291 1 127652 On behalf of my Ministry and the role in the development of the economy www.moem.gov.er Government of Eritrea, it gives me great side by side with the other sectors. pleasure to welcome you to the 2011 Department of Mines geocongress. Eritrea has a very enthusiastic work force P.O.Box 272 Eritrea is an attractive venue for invest- keen to learn and adapt to the dyna- Asmara, Eritrea ment in the Mineral sector for, but not mism of this sector. These coupled with Tel: +291-1-202889 limited to, the following reasons stated the positive role played by regional and +291-1-202843/44 below. local administration and the public at large Fax: +291-1-124509 make this country one of the top destina- As part of the Arabian Nubian shield, tions for investment in the mineral sector. 60% of the Eritrean territory is covered To find other Useful in formation on by Greenstone volcano sedimentary rocks Eritrea is far from being fully explored, Eritrea, please check these websites:- known to be favorable hosts to sever- there are still virgin but prospective areas www.shabait.com al metallic Minerals. Again the Arabian out there awaiting to be looked at. For this www.ecss-online.com Nubian shield is known for its ancient and and other reasons, Eritrea is an attractive www.dehai.org Modern world class deposits, to name a venue for investment in the mineral sec- few Sukeri in Egypt, Hassai in Sudan, Bisha tor. in Eritrea, Maaden and Gebel-Said in Saudi Arabia. It is my belief that the upcoming geo- congress will offer a unique Apart from these types of rocks ,Eritrea opportunity to highlight Eritrea’s Contents:- also offers favorable geology for industrial mineral potential and gain new and construction minerals of which the partners in the development Country Profile...... 3 recent discovery of Large Potash deposit of the sector for mutual ben- The Ministry of Energy and Mines...... 3 in the Northern Red Sea region makes it efit. Industry leaders will have Mining law...... 4 even more apparent. On top of this Eritrea an opportunity to share experi- Geology of Eritrea...... 5 has developed a coherent and attractive ances and discuss strategies to Mineral potential of Eritrea...... 6 policy in the mineral sector as is portrayed scale up investments. Geothermal potential...... 8 in it’s Mining Law. The Mining Law which Mining and Exploration Activities...... 8 is based on the Western Australia Mining Investment Opportunities...... 10 Code and is clear, simple and transparent. Ahmed Haj Ali Company Profiles...... 11 The Government is seriously committed to Minister of Energy and Mines develop this sector so as to play its positive Country Profile The Ministry of Country Profile Energy and Mines

Eritrea joined the world community of sense of Eritrean naonal unity. Tigrinya The Ministry of Energy and Mines is independent states in May 1993 follow- and Tigre are the most widely spoken the authorized Licensing Agency and ing a thirty year war for liberaon ending indigenous languages. English and Arabic is responsible for the administraon, in May 1991. A UN supervised refer- are also widley used regulaon and coordinaon of all types endum held in April 1993 enabled the The topography of Eritrea is excepon- of mining operaons in Eritrea. The De- Eritrean people toexpress unequivocally ally varied, from the 1,200 kilometer partment of Mines within the Ministry to the world their desire for freedom long coastal plain only a few meters encompasses, amongst other funcons, and independence. above sea level, through the central the Geological Survey, Mine Resources highlands ranging up to 2,500 meters Development and the Mines Administra- Soon aer independence, the govern- above sea level, to the low lying western on Divisions, and is also itself acvely engaged in mapping and exploraon acvies.

There are now five 1:250,000 scale geologic maps some of which are not published. 1:1,000,000 scale geologic map covering the whole country, has recently been prepared. The Eritrean mining sector has shown rapid develop- ment over the past few years since the Ministry of Energy and Mines started issuing licenses in 1997.

Since then, several exploraon com- panies have been involved in assessing and exploring the mineral potenal of the country. In the successive years addional licenses have been issued. and south western areas of the country. The Ministry has also been developing a ment of Eritrea has been engaged in Rugged mountain chains run from the naonal minerals database. The Ministry rehabilitang the war-torn economy and central plateau to the extreme north of has a responsibility to provide prelimi- improving the standard of living of the the country. The climate in these differ- nary informaon to exploraon compa- people. It created a conducive environ- ent terrains correspondingly varies from nies interested in conducng detailed ment for the acve parcipaon of local arid, to semi-arid, to temperate. The invesgaons in Eritrea, and to make and foreign private investors. However, mean annual rainfall in the coastal areas contribuon towards enriching the geo- since May 1998 the development of this is less than 300 mm per year, whilst in logical database of the country. As part young state has been severely curtailed the highlands and the western lowlands of its roune works, the Department by the border dispute with neighbour- rainfall ranges between 500 and 1,000 of Mines of the Ministry, through the ing Ethiopia. Despite this, the Eritrean mm. Mineral Resources Management Division people and Government are as resolute issues licenses to mining companies, as ever in their commitment and en- Eritrea’s infrastructure is centered on local miners, and controls and supervises deavors to work together to rebuild their a well developed communicaons net- exploraon and mining acvies so that country’s economy, and to secure social work linking the capital city Asmara to they are in line with the direcves of and economic progress. The outcome of the regions of the country, including the the Ministry and are environmentally the hard work is now being realized by two main sea ports of Massawa and Ass- compliant. In addion, the Department the emergence of a prospecve country ab, and to the neighbouring countries. of Mines, through its research wing, in the region. Asmara and Massawa have internaonal the Geological Survey, has been work- airports, which also serve internal flights. ing, together with foreign governmental This young state is located in the north- Inevitably, the ravages of war have le agencies and internaonal organizaons, eastern part of Africa with the Red Sea their mark on the infrastructure, and the to carry out geological mapping and on its east coast, Sudan to the west and reconstrucon of the prime facilies has mineral exploraon programs. north, and Ethiopia and Djibou to the been a high priority. Telecommunicaon south. Eritrea, with a land surface area facilies have also been renovated and Some of the acvies conducted in 2010 of about 125,000 square kilometers, developed, and mobile phones are now and in the last few years include: including hundreds of coral islands in a common sight. - Following applicaons by several the Red Sea, has a populaon of about exploraon companies, evaluaon was four million people. The country is home done and licenses were granted. At this to nine ethnic groups, all with a strong me about Twenty one companies are

3 Country Profile

acvely engaged in acvies of mining, and Regulaons on Mining Operaons which recognises the risky nature of mine development, in advanced and pre- Legal Noce No. 19/1995. mining investments, and hence allows: liminary exploraon operaons. Some Key Policy issues upon which the Mining of these companies are in joint venture Law is based include: * Accelerated depreciaon (straight with the Eritrean state owned mining line method over 4 years) of all capital • All mineral resources in Eritrea are corporaon ENAMCO (Eritrean Naonal and preproducon costs; public property. TheState has a duty to Mining Corporaon), but there are also * Write-offs of exploraon expendi- ensure the conservaon and sustainable Canadian, Australian, Brish and Chinese ture in curred anywhere in the country; * The carrying forward of losses; * A generous reinvestment deducon (5% of gross in come); * No dividend tax * A nominal rate of import duty (0,5%) on all inputs necessary for mining opera- ons; * Normal royalty rates as well as an opon for the reducon, suspension or waiver of the royalty in appropriate circum stances;

• Equitable foreign exchange regulaons perming; * Free and unrestricted repatriaon of earnings; * Retenon of a poron of foreign currency earnings abroad in external Central Highlandsdevelopment of these resources for accounts; companies. As the rate of success the benefit of the people; * Maintenance of foreign currency ac- of most companies is high, more and counts in banks in Eritrea. more companies are expected to apply • The intenon is to create a favour- and join the Industry. • A simple “one-stop” licensing system able atmosphere for foreign investment enabling all the formalies for all types in the mining sector. Due recognion is - The Eritrean Geological Survey in of licenses for mining operaons to be made of the significant role that foreign collaboraon with the Geological survey completed by a single Government agen- investment and skills can play in the de- of Iceland conducted a detailed geophys- cy, the Ministry of Energy and Mines. velopment of this sector and the capital ical survey consisng of Magnetoeluric intensive, long term, and risky nature of (MT) and transient Electromagnec mining investments; The mineral licensing (TEM) over the Alid geothermal pros- • The necessity for formulang regula- pect. The results of this survey indicate a ons which ensure protecon of the system good geothermal potenal in the area. natural environment, together with sus- The Mining Law permits the following tainable development of the country’s -The first dra of Regional Geological types of licenses: mineral resources, in accordance with Map of Eritrea, on 1:1,000,000 scale is sound principles of resource manage- finalized and is ready for distribuon. • Prospecng License, valid for one year ment and land use; In addion other geological maps on and nonrenewable; 1:250,000 scale were also produced on • Exploraon License, valid for an inial The Eritrean Mining Law is up-to-date, specific areas. period of three years, but which may be aracve and compeve, as it provides renewed twice for addional terms of considerable benefits and incenves to - By agreement with the China one year each, with an opon for further investors. For example, the law provides Geological Survey, geochemical renewals in appropriate circumstances; for: exploraon and mapping work have and been conducted in southern Eritrea. • Mining License, valid for a period of 20 • The right to exploit any commercial years withoponal 10-year renewals. discoveries made pursuant to a valid exploraon license; Mining law All of these licenses are exclusive and grant their holders an automac right The legal framework governing the • The right to sell locally or export, free to obtain an Exploraon License from conduct of all mining and related opera- of all dues and taxes and without being within a Prospecng License and a Min- ons within the territory of Eritrea is required to obtain any other authorisa- ing License from an Exploraon License, embodied in a Mining Law comprising: on or permission from any other subject to the fulfillment of the obliga- Minerals Proclamaon No 68/1995, Government agency, all minerals pro- ons under the preceding license. Mineral Proclamaon 165/2011, Mining duced pursuant to a mining license; Although the maximum area that a sin- Income Tax Proclamaon No. 69/1995 gle license can cover is fixed at 100km2 • A simple and fair taxaon system

4 Country Profile for a Prospecng License, 50 km2 for intraoceanic magmac-arc rocks. salts, occasional thin and disconnuous an Exploraon License and 10km2 for a marbles, and manganiferous and ferrugi- Mining License, simultaneous possession In Eritrea, the basement rocks are not nous cherts. The Hagar Terrain displays of mulple conguous licenses is permit- well studied despite their high mineral an east verging thrust contact with the ted. potenal. The two geological maps so adjacent segment to the east. The Hagar far completed cover the western part Terrain is known to be prospecve for Applicaons for any of these licenses of the country (Geology of Gash River chromite, planum group elements, may be made by individuals or legal en- Area) and the southern part of the nickel, gold and copper mineralizaon. es of any naonality. All applicaons are to be made on specified forms that can be obtained from the Department of Mines of the Ministry of Energy and Mines and must be accompanied by a nonrefundable processing (registraon) fee of US$1 per page of each applica- on and the supporng documentaon presented. Successful applicants are also subject to a payment of license fees and the first year’s rental upon the issue of a license. The rate of these fees is gov- erned by Regulaon and is at present as follows:

License Fee Annual rentals (per license) (per km2) License US$(approx.) US$(approx.) Prospecting 80 8 Exploration 240 32 Mining 960 96 Nabbro Volcanic Eruption June 2011 country (Geology of Mai Dima/Kohain The Geology of Area). Compilaon of geologic maps at The eastern segment, the Nakfa Terrain, 1:250,000 scale has recently been com- is bounded by the Adobha Abi valley in Eritrea pleted for four map sheets. Other study, the west and by the Red Sea escarpment based largely on satellite image interpre- to the east. It is made up of calc-alkaline The geological set up of Eritrea is made taon aided by limited ground controls, volcanic and volcanoclasc rocks con- up of Precambrian basement rocks that suggest that the rocks can be subdivided formably overlain by a metasedimentary are overlain unconformably by predomi- into four tectonic blocks or segments, sequence of chlorite schists, grits and nantly Mesozoic sedimentary rocks and separated by tectonic boundaries. Three polymict conglomerates with occasional Terary to Quaternary volcanic and of these blocks, the western, central and pelic sericite schists and carbonates. sedimentary rocks. eastern segments, underlie northern The metavolcanic rocks are intruded by and central Eritrea, whilst the fourth, the variably deformed plutonic to hypabyssal Precambrian Basement Rocks Danakil segment, occurs in the south- calc-alkaline bodies. The sequence is cut eastern part of the country. in places by post-kinemac granites and Basement rocks in Eritrea cover more gabbros and is also transected by several than 60% of the surface of the country. The western segment, the Barka Terrain narrow shear zones sub- parallel to the The basement rocks of Eritrea are part is exposed in the north-western part regional strike. The Nakfa Terrain is of the Arabian Nubian Shield (ANS) of the country and underlies the Barka considered to represent a relict island which are exposed in north east Africa lowlands. It is made up of amphibolite, arc assemblage. Several VMS (Volca- (Egypt, Sudan, Eritrea, and Ethiopia) and amphibolite-facies pelic schists nogenic Massive Sulphide) base metal in Saudi Arabia, northern and north- containing kyanite and staurolite, quartz- occurrences and gold showings are as- western parts of Yemen and part of the ites and marble. sociated with this tectonic unit. western Middle East. The central segment, referred to as the The southern segment, The Danakil The shield is believed to represent a Hagar Terrain, extends from the Barka Terrain, is composed of metamorphic mega suture between East and West River up to the Adobha Abi valley in rocks which may be grouped into three Gondwana. Archean and Paleoprotero- the east, and comprises several large formaons:- zoic connental crust rocks make the ellipcal bodies of various tectonic (1) migmac hornblende biote older components of the shield and oc- units that are dominantly composed of gneisses; cupy a very small part of the basement oceanic and accreonary wedge materi- (2)a phyllic formaon consisng of rocks and the major part of the shield als. Occasionally, layered sequences of schists, conglomerac phyllites, consists of Neoproterozoic (c. 870-670 chloric schists are seen, inter-layered crystalline limestones, and graphic Ma) connental-marginal and juvenile with epidoc and chloric metaba- schists; and

5 Country Profile

(3) post-tectonic granitoids. idenfied: the Danakil, Dogali and Des- mine, Bisha VMS deposit, has started set Formaons. The Danakil and Dogali producon. Koka project has completed Recently compiled geologic map of the Formaons are of late Terary age and feasibility work and there are other whole country at 1:1,000,000 scale has are composed mainly of limestones advanced projects and many exploraon divided the Precambrian basement rocks intercalated with conglomerac sand- operaons underway. Considering much into 7 domains, 5 groups and 3 forma- stones and siltstones. They are overlain of the country remains unexplored, ons. It is rather a more detailed presen- by calcareous sands with coral reefs, these discoveries indicate the high min- taon of the rock units of the country. partly consisng of pebbles of volcanic eral potenal of the country. The po- origin, and gravels with sand, silt and tenal for shear hosted gold deposits is Mesozoic Sediments clay horizons. The Desset Formaon also demonstrated from the recent, gold comprises sandstones, clays and fine discovery in Zara, situated along a major The lower Mesozoic sediments are rep- beds of anhydrite and halite unconform- shear zone that runs across the country. resented by the Merbet (Adigrat) Sand- ably overlying the Dogali formaon in The country is not well explored. There stone which outcrops in the southern the northern part of the coast, while the are many prospecve areas sll to be part of the country and in the Danakil Red Series containing coarse clasc fresh discovered. area, and is commonly intercalated with water sediments occupies the southern siltstones and haemac layers. It lies part of the coast. Eritrea possesses a geological seng unconformably over thin layers of con- that is favourable for both precious glomerac sandstones which, in places, Quaternary Sediments metals and base metal mineralizaon, appear to have the characteriscs of a as well as for industrial minerals. The glacial deposit. Overlying the sandstone range of idenfied potenal deposits A thick evaporic formaon of bedded covers gold and other precious metals, is the Jurassic Adailo (Antalo) Limestone. halite, gypsum, anhydrite, potassium This unit is exposed over a large area polymetallic massive sulphide types and and magnesium salts, with shell mate- quartz vein and quartz stockwork type in the Danakil and is made up of lime- rial fills the basin in the Danakil Depres- stones that are compact, partly shelly, of deposits. There is an indicaon for the sion. Deposits of sheelood terraces, occurrence of Nickel and chromite de- fossiliferous and layered. Alternaons of silt, sand and gravel are present in some quartzic layers are present in the lower posits associated to the ultrabasic rocks locaons occasionally covered by wind- in the far north of the country. part, whilst towards the upper part the blown sands. Basalc flows and related sequence becomes mainly gypsiferous to spaer cones represent Quaternary Occurrences of minable potash and sul- dolomic. The Upper Sandstone forms volcanic acvity in the Danakil region. pockets of sandstones that have been phur evaporates in the Danakil depres- preserved from erosion. Commonly this sion, has now become apparent, and a sandstone is medium to coarse grained, Mineral potential of variety of construcon materials, includ- light coloured, and dominantly quartzic ing marble, granite and others in several but partly conglomerac. Eritrea parts of the country is also well known. Tertiary Volcanics and Sedi- Eritrea has a long history of mining. Gold Despite this modern mining began at the ments beginning of the 20th century following Recent exploraon acvies have the Italian colonizaon of the country. proved that gold occurrences are very The Terary volcanics can be divided into Aer the Second World War, mining and widespread in many parts of Eritrea and three units: related operaons connued throughout the country has great potenal for devel- (1) the plateau-forming Terary basalts the country, although intermiently. In oping more gold deposits. In addion to that are predominantly olivine basalts the early sevenes this resulted in the the previously known areas of primary with intercalaons of intermediate lavas development of the short-lived mod- gold occurrence in the central highlands and tuffs; ern mine at (2) the lower Afar strafied basalts Debarwa, composed of basalc lava flows and tuffs before the in- that are usually found intercalated with dependence sediments of the Danakil Formaon; and struggle (3) the Afar Basalts composed of recent forced its lava flows and volcanic cones, with closure. minor acid to intermediate volcanics, mainly trachytes, rhyolites and ignim- Eritrea is now brites. The Terary basalts are currently known to acvely exploited for aggregates. host sig- nificant VMS deposits as The Tertiary Sediments well as shear- The Terary sediments lie along the Ri hosted gold escarpment and in central Afar. Three deposits. The sedimentary formaons have been first modern Old mine at Adi Shimagle

6 Country Profile

(which includes the so called Hamasien area, sulphide-rich gossanous rock in Italians, are found south east of Lahaz- gold field), those of Shillalo (in south- Mt Tullului(Bedeho) in Sahel, northern ien. Large deposits of kaolin occur in the western lowlands) area, and those of Eritrea and in Mt Seccar and Sheib areas lateric horizon in parts of Teraimni, at southern Eritrea, exploraon acvity in in the Eastern Lowlands. Adi Koteio close to Adi Kwala, Adi Keih, the last decade has shown the presence Zeghib, Adi Hawusha, Adi Ahderom and of economic gold deposits in the west- At Bisha, a world class deposit of pre- west and south-west areas of Himbir . ern lowlands and also in the northern cious and base metal VMS deposit has part of the country. been found. Exploraon in Adi Nefas Extensive deposits of the raw materials VMS shows 9.0 metres grading 11.91 g/t for cement manufacture are found at The average head grades in most of the Au, 285 g/t Ag, 3.18% Cu and 11.05% Zn Adailo, close to Tio with all the constu- historic vein gold mines that were acve and in another test drill NG-043-D – 5.25 ents including limestone, marl, clay and during the Italian colonial me up to metres grading 10.81 g/t Au, 239.8 g/t gypsum close together. Barite occur- the late 1950s, were reported to be as Ag, 6.77 % Cu and 6.77% Zn has been rences have been idenfied around high as 25 - 45 g/t, with reasonably good obtained. Reserve esmaon made the Heneb, Meter and Gharsa wadis to recoveries. Eritrea’s gold mineralizaon recently has shown that minable zinc, the north west of Mersa Gulbub. Barite is usually hosted in quartz veins and copper and associated gold is present in veins also occur associated with faults in stockworks, and in parcular in shear Adi Nefas. Embaderho is now emerging the sediments of the Dogali and Des- zones associated with felsic volcanic as a large base metals (Cu-Zn) deposit set Formaons. Other barite deposits rocks, dioric intrusions and in various with some associated gold. Resource of economic significance, with reported schists that are frequently sub-parallel to esmaon is sll going on, however at grades of 95-97% are known to exist at the strike of the pronounced cleavage of this stage it is confirmed that it is a big Debarwa and Kena. the host rocks. base metal deposit. Construction Materials Occurrences of gold within exhalave Overall in terms of mineral potenal as- VMS deposits, and in the weathered and sessment and geological work, much of Large deposits of marble occur as belts supergene zones overlying them, are the country remains unexplored, despite running north-northeast from Adi Ibrhim becoming more evident with recent ad- the several discoveries that are being south to Gerenfit areas. However, there dional discoveries of gold in Debarwa made. are few quarries of Marble in Gogne and Adi Nefas (in the central highlands), and Goranda area which are situated at and at Bisha and Harena (in the western the middle of the belt. Similar belt also lowlands). occurs further west and runs from Alebu Base Metal Deposits Industrial Minerals southwards to Guluj.

NNW to NNE-trending belt of gossans, Potash, sylvite and gypsum-bearing Far, in northern Eritrea, a belt of marble exhalave cherts and altered felsic rocks evaporates occur at Colluli, south of occurs in Adobha Valley area. Other that are indicators of massive sulphide Bada. South Boulder Mining Ltd, a significant marble deposits occur at mineralizaon are recorded in many company looking for Potash deposit in Aimbol, Amberbeb, and Mt. Kuruku (in parts of Eritrea. The ores of these mas- the southeastern margin of the evapo- the upper valley of Barka). The Kertse- sive sulphide deposits are predominantly rate deposits in Dankalia, have shown Komte and Debri black and gray marble chalcocite, pyrite with minor amounts of their hope to discover Potash deposit in deposits occur south of Decamhare and sphalerite, chalcopyrite and bornite. A billions of tones. Substanal deposits of have been exploited for a long me. major belt of massive sulphide deposit gypsum occur at Desset area, north-west Recrystallised limestone deposits with with gold and base metal mineralizaon of Massawa. Large deposits of common variegated colours occur at Dichinema passes through Asmara and includes De- salt also occur at several places along area, in the southwest of Eritrea. barwa, Adi Nefas, Embaderho and many the Red Sea coast. other localies roughly within a 50 km Granites of various colours and textures wide belt over a strike length of 250 km, Considerable quan- extending from, more than 50 km north es of high quality of Asmara up to the Eritrean border to silica are found at Mer- the south. The belt that includes the bet, which has been Bisha high-grade zinc-copper-gold VMS exploited for glass deposit and Harena VMS deposits in the manufacturing. In addi- Western Low lands has already proved on, deposits of silica the presence of world class deposits sand with feldspar and is also being explored for addional occur at various wadis discoveries. of Eritrea. High purity feldspars occur in peg- There are indicaons of similar VMS mates at Lahazen, 35 base metal deposits farther north kms south of Massawa. of Kerkebet, Harabsuit and possibly Sub economic deposits surrounding areas. There is a belt of of mica, which was copper mineralizaon in Raba-Semait once exported by the A Steaming Ground

7 Country Profile

are exposed over large areas. Granites Mining and Development-Stage Project, located around Asmara area. It of dimension stone quality, which are has been acvely conducng explora- currently being exploited, occur at Geleb Companies:- on works around Asmara since it took it (pink granite), and in the Arato, Korbaria, over from Sub-Sahara Resources in 2003. and Tukul areas (grey granite). The Mai- Bisha Mining Share Co (BMSC) mine granite and Elabered granite are The work thus far done by Sunridge, is a mining and Exploraon Company also suitable candidates for dimension has resulted in the definion of four NI owned in joint-venture between Eritrea’s stone. 43-101 compliant resources on the As- Naonal Mining Corp. (ENAMCO) and mara Project with total combined metal Canada’s Nevsun Resources Ltd. BMSC A narrow outcrop of coral limestone ex- content of 1.3 billion pounds of copper, managed to make the first modern mine tends along the coast from the headland 2.5 billion pounds of zinc, 1.1 million in Eritrea. Aer commissioning in the of Ras Kassar to the coastline of Tio. Im- ounces of gold and 32 million ounces end of 2010, and starng of commercial mense deposits of limestone occur of silver. The largest deposit is the 63 producon in February 2011, mining in the Adailo-Aitosh area south-west of million tonne Emba Derho copper-zinc- connues with strong operaonal and Tio. gold VMS deposit that is located just 12 safety performance. Bisha is a high kilometers from Asmara. grade, low cost mine with 28 million Geothermal Potential tonnes @ 1.78 g/t gold, 38.9 g/t silver, Sunridge is working to advance all its 1.6% copper and 3.15 % zinc and indicat- projects within its three licenses. In Economic exploitaon of geothermal ed and inferred resource of 10.6 million connuaon of its prefeasibility studies, heat for power generaon appears pos- tonnes @ 0.67 g/t Au, 47.78 g/t Ag, 0.91 it has conducted a number of resources sible in ri-related volcanic rocks in the percent Cu and 5.67 percent Zn. and geotech drilling, and environmental Red Sea Ri areas. Alid, Nebro, and Dubi studies in Debarwa, Embaderho and Adi Aiming to expand the reserve, the areas are the main targets as geothermal Nefas VMS and Gupo deposits. These company is conducng detail explora- acvity in these areas is known to be will enable it to submit feasibility report on programs involving infill drilling in intensive. Lower temperature acvity for Debarwa and prefeasibility report for Bisha main, drilling-assisted exploraon also occurs at Mai Wuui, 30 kms west of Embaderho, Adi Nefas VMS and Gupo in Bisha Northwest, in the Hanging wall Massawa. deposits. zone and in Harena deposits. There are clear indicaons not only for the poten- Geothermal acvity, evidenced by al increase of the reserve at the Bisha South Boulder Mines Ltd. is a junior fumaroles and hot springs with extensive mine but also for addional feed of the Australian exploraon company engaged alteraon on the ground, are abundant Mine from the laer deposits. in exploraon for potash resources in in the Alid geothermal field. Studies car- Danakil area. The company is progress- ried out so far in this area indicate the ing well with discovering a very signifi- presence of a possible sub-surface high Chalice Gold Mines Ltd. is an Aus- cant potash deposit at shallow depth in temperature reservoir. tralian gold exploraon company which Culloli area. The company has completed owns the high grade, open-piable Koka resource definion studies and has come The geothermal manifestaons at Nebro Gold Deposit and a substanal, largely up with the following resource of potash and Dubbi are also promising, but fur- unexplored, land package in Eritrea. The at Colluli: JORC Resource of; 33.39 mil- ther study will be required to esmate Koka deposit is esmated to host around lion tonnes at 18.56% KCl of Measured the reservoir temperature. five-million tons of ore, grading at Resources, 173.37 million tonnes at 5.3 g/t gold, for 840 000 contained 18.57% KCl of Indicated Resources and ounces. The deposit further hostes a 340.86 million tonnes at 18.58% KCl of MINING AND probable ore reserve of 4.6-million tons, Inferred Resources. The total is 547.62 EXPLORATION at 5.1 g/t gold for the 760 000 contained million tonnes at 18.58% KCl, for total ounces. contained potash of 101.73 million ACTIVITIES IN ERITREA The Company is focused on developing tonnes. the Koka Gold Deposit into a low cost Currently the company is conducng an Eritrea is becoming the focus of mining gold mine which is expected to produce engineering scoping study into open pit and exploraon acvies as can be seen 104,000 ounces of gold per year over a mining and processing to produce up to from the increasing number of compa- 7 year mine life at an average cash cost 10 million tones annually of potash and nies acvely operang in the country. of US$ 338/oz gold. Chalice also holds a it is targeng 1.5 billion tones of potash Recently a number of companies agreed substanal strategic ground posion of @20% KCl, which has an in ground value 2 to conduct airborn geophysical survey 1.437 km consisng of licenses along of about USD$ 150 billion. and the survey is sll underway. Pre- strike of the Koka Gold Deposit, and liminary results are indicang that a proximal to Nevsun's Bisha Mine. number of targets are being generated NGEx/Sanu Resources Inc. is a Canadian exploraon company, look- for further follow ups in different conses- Sunridge Gold Corp.(SGC/TSX) ing for gold and base metals in Mograib sion areas. is a Canadian, mineral exploraon and and Kerkebet exploraon properes development company engaged in ex- in western Eritrea and holds Lelit and ploraon and development of base and Shikula areas of exploraon license in precious metal deposits on the Asmara northwestern Eritrea. Reverently the

8 Country Profile company conducted detail exploraon Beijing Donia Resources Co. is Km2 exploraon license property Sahar work at l: 5,000, including airborne a Chinese exploraon company that is acquired from the Ministry in 2010. VTEM survey target vising, reinterpre- engaged in exploraon for gold and base It has reassessed the earlier geologi- taon of geophysical data in Mograib metal deposit in its Kenab exploraon cal maps and conducted soil sampling area where Hambok deposit is located. license area. Since it acquired the area, aimed at generang targets. Hambok deposit has an NI43-101- in it has conducted geologic mapping, compliant indicated resource (@0.75% gravity and IP survey and is waing for Adobha Resources (Eritrea) Pty zinc cutoff) of 10.7 million tones grading interpretaons. 0.98% copper, 2.25% zinc, 6.84 g/t silver, Ltd. a wholly owned subsidiary of Gibb- 0.20g/t gold and an addional inferred sland Ltd, is an Australian junior explora- resource (@0.75% zinc cutoff) of 17.0 Land Energy is a Chinese exploraon on company holding three prospecng million tones of 0.85% copper, 1.74% company that is looking for gold and and one exploraon properes in the zinc, 5.89g/t silver, 0.19 g/t gold. base metal deposits in Haykota area, northern part of the country. Following Aradaib Prospect, in Kerkebet license is south of Bisha mine. The rocks of the LandSat assessment of the areas, the reporng interesng results on the inial area are southern extension of Bisha. company has been conducng regional drilling works such as 13m of 3.3 % cop- Currently the company is waing for the geological mapping and helicopter- per, 5.6% zinc, 1.8 g/t gold, 46 g/t silver. assay it has drilled before few months. assisted reconnaissance surveys. The company is also conducng explora- The core and trench samples have been on works in Let and Shikula explora- sent for analysis to China. on license areas. Thani-Ashanti Eritrea Ltd. is an exploraon company formed by joint China Africa Huakan Investment Exploration Companies:- venture of an Emirates and South African Co. has been exploring for gold and Anglogold Ashan, having two explo- raon properes in western Eritrea, Sub-Sahara Resources (Eritrea) base metal in Seroa, north of Keren, and in Mensura area. Drill tesng in Seroa Akordat North (in Anseba Region) and has been acvely exploring in Eritrea for Kerkasha (South of Barentu), making the past 11 years. The inial properes was not encouraging, but sample assay results are awaing. Prospecng work a total of 1863 km2. The company has that Sub-Sahara secured contained the conducted airborne geophysical surveys volcanogenic massive sulphide (VMS) in Mensura has been transferred into exploraon license. over its properes and is currently do- prospects surrounding the capital city ing review and interpretaon works for of Asmara. The Debarwa Cu/Zn/Au/Ag deposit was successfully advanced to a Zhong Chang Mining Co. ‘Scoping Study’ for mining before the enre land package was sold to joint Ltd. is a Chinese company venture partner Sunridge Gold Corp in granted exploraon license in 2007. During 2007, Sub Sahara acceler- Mai-Mine area. The Company ated exploraon acvies on its Zara has been doing geological map- Gold Project (in the north-west of the ping and grab sampling and country) and was rewarded with defini- trenching to define targets for on of a +1moz gold deposit (Koka) grad- drilling. It is looking to conduct ing 6.31g/t, in early 2008. The Koka Gold high precision magnec survey Deposit is now owned by Chalice Gold over selected targets aer assay Mines. Sub-Sahara is now conducng are made available. exploraon acvies in the Zara North and Zara South exploraon properes. London Africa Ltd. is a Lon- Agreement Signing don based junior exploraon company Andiamo Exploration Ltd. is a junior that has been mapping, stream sedi- Kerkasha and exploraon for Akordat UK based exploraon company that has ment and soil sampling and channel rock North area. been granted 723 km2 exploraon prop- chip sampling in areas of some indica- erty in Haykota area in 2009. As south- ons of mineralizaon. Very high values Beijing Sinoma mining invest- ern extension of Bisha deposit, the area of gold have been obtained from some has indicaons for shear hosted gold and rock samples and the area appears to be ment Ltd is a Chinese exploraon VMS-style mineralizaon. of some potenal. company looking for potash deposit Andiamo has done significant regional, in its 455 Km2 exploraon property in as well as detailed geologic mapping, Dankalia area in between areas belong- image interpretaon, soil sampling Sahar Minerals Ltd. is an Australia- ing to South Boulder and Bada Potash. and ground gravity surveys. During this based privately held exploraon compa- ny established in early 2009. It has been regional and follow-up exploraon pro- Bada Potash Ltd. is a young Canadian grams, the company has come up with acvely evaluang and exploring the two properes (Augaro and Harab Suit) exploraon company focusing on explo- different targets that are now ready for raon for potash deposit in Bada area drill-tesng. it secured. Augaro property is in joint venture with ECEM, an Eritran-Chinese Dankalia, not far from the property of Share Company while Harab Suit is a 379 South Boulder Mines. Since it acquired the property in late 2010, it has been

9 Country Profile

conducng compilaon and review of is now (since Feb. 2010) working in joint prospecve geology of the area and the earlier data, image interpretaon and venture with Sahar Minerals, an Austra- recent major VMS discoveries of Bisha updang regional geological and ground lian Exploraon company focusing on and Emba Derho and a number of shear magnec surveying over the enre li- gold and base metal potenal mines. hosted deposits like Koka(Zara) and the cense area and has also completed some presence of numerous old prospects gravity survey. The company is now The following small exploraon compa- most of which are not evaluated makes starng drilling to outline the basin for nies; Keren Mining Ltd in Mograib North Eritrea a country of high gold and base shallow potash mineralizaon. and Hurum exploraon licenses; newly metal potenal. Airborne geophysical added Chinese companies Shandong survey that has covered large area and is Eri-Lib Mining Share Company Mining Development acquired 2600 km2 sll underway in the properes of some is an Eritrean and Libyan joint-venture prospecng license area in Dekemhare of the companies is already generang exploraon and mining company. It is and up to Mendefeare areas and Min- many targets few of which could be acvely exploring for gold and base Metals Exploraon and Development deposits. metals in two separately located proper- Ltd is holding a prospecon license area es it acquired in 2009. The Nefasit around Adi keyih. Epithermal gold potenal associated 2 exploraon license 1,636 km area in the with recent volcanic rocks has not been 2 eastern escarpment while the 1,151 km assessed yet. The recent discovery of exploraon license area is in the south Investment potash deposit associated with the western low lands of Eritrea. evaporate beds also indicates the poten- Opportunities al of the evaporate beds in the Eritrean part of the basin. Eritrea-China Exploration and Eritrea is a country where rocks belong- Mining Share Company (ECEM), is ing to the prospecve Arabian Nubian The prospecve geology and the arac- a joint exploraon and mining company Sheild make more than 70 % of the ve and compeve investment regime between an Eritrean ENAMCO and a Chi- country. A Vast area of the country sll makes Eritrea one of the most aracve nese company and has been conducng remains unexplored. An ever increasing and rewarding mining investment oppor- exploraon and detail drilling works in area cover by Arsanal mining acv- tunies. The future of Eritrea’s mining 1000km2 area in Augaro. The company ity is an indicaon that there are sll industry appears bright. many deposits to be discovered. The

10 Company Profile Bisha Mine: The First Modern Mining Project

Project Overview there is a satellite deposit, The Bisha Project is a large precious and Harena and several other base metal-rich volcanogenic massive geophysical anomalies that sulphide (VMS) deposit located 150km have yet to be tested. Nev- west of Asmara, Eritrea, East Africa. sun, through its Eritrean sub- Mineralizaon consists of gold and silver sidiary, Bisha Mining Share contained in oxide ore, in addion to Company (BMSC), holds the copper and zinc massive sulphides. The Licenses. The State of Eritrea project benefits from the strong support has a free carried 10% inter- of the Government of Eritrea and good est plus an addional 30% local road and port infrastructure. paid parcipang interest The Bisha Mine began construcon in for a total of 40% interest of 0.65. September 2008 and declared com- in Bisha. The interest will be paid over The BMSC OH&S Department is man- mercial producon in February 2011. me, out of Bisha cash distribuons. aged by an experienced mining profes- Up to the end of June 2011 Bisha had sional and, apart from normal dues, is currently involved in training an Emer- produced 168,000 ounces of gold. Bisha Phase 2 – Copper Concentrator A workforce of 660 employees, includ- gency Response Team from volunteer Phase 2 of the Bisha Project involves the Bisha employees. ing 60 expatriates, run the operaon construcon of a copper flotaon plant which will Training produce a concentrate con- Mining is a completely new industry in taining approximately 30% Eritrea and as such, appropriate skills copper together with gold in the Mining and Processing fields are and silver as by-products. rare. A dedicated training department is Power generaon, crushing, responsible for idenfying and coordi- milling, services and tailings nang the training requirements of the disposal infrastructure from Eritrean workforce. Expatriates cur- the Phase 1 CIL plant will rently account for just under 10% of the be common to the copper permanent workforce and are recruited plant. in order to provide local employees with on a 24 hour 7 day per week basis. All Annual concentrate producon of ap- the specialized skills required to operate acvies including mining are owner proximately 260,000tpa will be trans- a world class mining operaon. ported by road to a new port at Mas- operated and maintained with the Training matrixes have been prepared sawa and shipped in bulk to overseas excepon of the 19.5MW power genera- for all local employees to ensure that on plant. The Bisha Mine is expected to produce 1.14 million ounces of gold, 11.9 million ounces of silver, 821 million pounds of copper and over one billion pounds of zinc to a mining depth of 240m. The orebody is open below this and high grade Commercial Production Schedule zinc intersecons have been smelters. The Phase 2 Concentrator and they receive the necessary training to obtained at 350m below surface. Bisha’s associated infrastructure are scheduled become fully competent in their indi- mining and exploraon licenses cover for compleon during 2013. Engineer- vidual roles. Succession planning is in a conguous area of 92 km2. The Bisha ing, procurement and construcon com- place to ensure an orderly transfer from Main and North West zone are both menced in early 2011. located within the 16.5 km2 mining expatriate to local posions within a license. Within the exploraon license Occupational Health & Safety realisc meframe. Bisha management considers that there Company Address and contact details is nothing more important than prevent- ing injuries within its workforce. This is Bisha Mining Sh. Co. achieved through the implementaon of 61, Mariam Gimby, training programs, safe work procedures, P.O.Box 4276 hazard idenficaon and risk assess- Asmara, Eritrea ments. The success of this program Tel. +291 1 124941 is illustrated by the current BMSC 12 www.bishamining.com monthly Lost Time Injury Frequency Rate www.nevsun.com

11 Company Profile Chalice Gold: Developing East Africa’s Next Gold Mine Chalice Gold Mines Limited (ASX: gold, placing the project in the lowest Chalice also holds a 100% interest in a CHN; TSX: CXN) is focused on gold quartile of global gold mine production further 825 square kilometres of explo- mine development and exploration in costs. ration ground consisting of the Hurum Eritrea, East Africa, where it is develop- Exploration Licence, located along strike Planned mine production will aver- ing the high-grade Koka Gold Deposit as from the Zara licences, and the Mogo- age 104,000 ounces of gold per year an open pit gold mine. raib North Exploration Licence, located over a seven year mine life based on just north of Nevsun’s world-class Bisha an expected milling rate of 600,000 to The Koka Gold Deposit hosts a JORC Mine. 700,00 tonnes per annum. Capital costs for the mine development are forecast This extensive exploration package at US$122 million and the Project has is believed to hold potential for both an NPV using a 5% discount rate of structurally-controlled gold mineralisa- US$293 million at a gold price of $1,500 tion similar to Koka and volcanic-hosted per ounce (see below). massive sulphide (VHMS) base metal (+

gold) mineralisation similar to Bisha. EXPLORATION POTENTIAL The Koka Gold Deposit lies within the On the Mogoraib North Licence, Chalice 547 square kilometre Zara block of has just completed an airborne VTEM Exploration Licences, where Chalice survey combined with magnetics and currently has an active drilling program radiometrics. The VTEM system is de- underway to test IP resistivity targets in signed specifically to define bedrock con- the vicinity of the Koka deposit. These ductors potentially indicative of massive targets have been defined over a strike sulphide deposits. Preliminary interpre- length of 7.5 km within the heavily min- tation of the VTEM data has confirmed eralised ‘Koka-Konate Corridor’ and are the presence of several promising targets interpreted to represent possible silicifi- which are being further refined prior to cation associated with gold mineralisa- drilling later in 2011. and NI 43-101 compliant Probable tion. Drilling has also been directed to target potential extensions of the Koka Mineral Reserve of 4.6 million tonnes On the Hurum Licence, Chalice has com- deposit both at depth and along strike to grading 5.1 g/t gold, containing 760,000 pleted a heli-borne magnetic and radio- the south. ounces. This reserve is included within metric survey as well as stream sediment an Indicated Resource of 5.0 million Elsewhere on the Zara licences, Chalice and soil geochemical sampling. This tonnes grading 5.3 g/t gold, containing has defined extensive zones of stream work has highlighted potentially signifi- 840,000 ounces of gold. cant gold mineralisation at the Babtono prospect The Company recently finalised a where artisanal miners Shareholders’ Agreement with the have worked gold-bear- Eritrean National Mining Corporation ing vein systems over a (ENAMCO) under which ENAMCO strike length of several will pay US$32 million to Chalice for a hundred metres. This 30% participating interest in the 547 sq and other geochemically km Zara Licences. This interest, together anomalous zones will be with a 10% carried interest, will be held explored in more detail via an operating company, Zara Mining over the next 12 months. Share Co (“ZMSC”). The remaining 60% of ZMSC will The combination of a be held by Chalice. ZMSC will own, sediment gold anomalism which have robust gold resource at the Koka deposit, explore, develop and operate the Koka been followed up by systematic soil and which is moving towards development, Gold Mine and the surrounding Zara rock chip sampling. This work has iden- and the potential for further gold and Licences. Chalice, together with its part- tified several high priority targets such base-metal discoveries within its exten- ner ENAMCO, is currently working to as the Debre Tsaeda and Hammid Keir sive tenement block, puts Chalice Gold secure the granting of a Mining Licence prospects that will be investigated during in an excellent position for rapid growth. and hopes to commence development of future drilling programs. the Koka Gold Mine in early 2012 with production slated for late 2013. The Zara tenements have also been Company Address and contact details covered by heli-borne aeromagnetic and Chalice Gold Mines Ltd KOKA GOLD PROJECT radiometric surveys which have defined Level 2, 1292 Hay Street Chalice completed a Feasibility Study the regional litho-structural architecture West Perth, Western Australia 6005 in July 2010 which found that the Koka in great detail. These geophysical data PO Box 2890 Perth 6001 Gold Deposit could be developed as a have been integrated with the geochemi- Western Australia robust open pit operation with a forecast cal data and are being used to rank explo- Tel: +618 9322 3960 ration targets for follow up. low cash operating cost of US $338/oz Website: www.chalicegold.com

12 Company Profile

low mineralisation and good infrastructure location. Further to this there is potential to expand on the initial 1-2Mt p.a production rates compara- tively cheaply. South Boulder expects to be able to mine the lowest cut-off grades from a conventional mine in the world and to convert a much larger proportion of resources to mining reserve than the industry average.

In addition, South Boulder has high quality nickel sulphide and gold targets at the Duke- ton Greenstone Projects in Western Australia. The Duke- ton Nickel JV is fully funded through to Bankable Feasibil- ity Study whereby Indepen- dence Group NL (ASX: IGO) is earning 70% of Ni-Cu-PGE mineralisation and associated gold. The Project has had re- cent success at The Rosie and KCI. Potash minerals include sylvinite, C2 Nickel sulphide prospects South Boulder Mines Lim- where drilling has defined intercepts of ited (ASX: STB, South Boulder) is an carnallite and kainite. It is anticipated that the resource will grow substantially 5.20m @ 9.13% Ni, 1.09% Cu, 0.21% Australian based exploration and mining Co and 7.09g/t PGE’s at Rosie and 50m company developing the world class Col- with further drilling and there is a current Exploration Target of 1.25 – 1.75 bil- @ 0.92% Ni, including 37m @ 1.05% Ni luli Potash Project in Eritrea. The com- at C2. pany anticipates the production of 1-2Mt lion tonnes @ 18-20% KCl which is all of potash via open pit mining methods in located above 100m vertical depth. An estimated 90% of global potash produc- Significant resource definition drilling 2016 or sooner. has been completed The Colluli Project is situated in a at the project with an uniquely young and shallow evaporite initial JORC Compli- basin called the Danakil Depression ant Mineral Resource which straddles the Eritrean and Ethio- Estimate due in 2011. pian border in the south eastern coastal An engineering scoping region of Eritrea. A number of resource study into an open pit companies are conducting aggressive re- and underground mine source definition and extension programs to exploit the resource in the basin for the first time since 1968. tion comes from underground mines as is underway. South Since June 2010 South Boulder has deep at 1,000m below surface. Boulder owns 100% of the gold rights defined a substantial mineral resource to the Duketon Nickel JV tenure and a and has been conducting feasibility South Boulder is currently focused on 1,500km2 land package surrounding it. study activities into mining the world’s feasibility study activities including: first open cut potash. High grade potash mineralisation has been discovered from Resource extension and open pit mine Company Address and contact details South Boulder depths as shallow as 16m. This shallow design; S.A. Building 7th Floor, depth is the key to the project economics, Metallurgical test work; 189 Warsay Street and sets it apart from all known potash Hydrogeological and geotechnical tel: +291 1 111463 resources. In addition the mineralisation assessment; fax: +291 1 11146?, is located some 70km from the Red Sea Infrastructure assessment; Asmara, Eritrea coast which provides many suitable op- Environmental, social impact studies tions for export of the final product. and mine approvals. Website:- www.southbouldermines.com The current JORC/43-101 Compliant The Colluli Project will demonstrate E-mail:- Mineral Resource Estimate comprises some of the lowest operating costs and [email protected] 548Mt @ 19%, including 119Mt @ 23% cheap start-up capital costs relative to the industry, primarily due to the shal- [email protected]

13 Company Profile Sunridge Gold: The Asmara Projects

Sunridge Gold Corp (SGC/TSX-V) is a Canadian junior mining company that The Debara has been focused on exploration and copper-gold- development of base-metal and gold silver-zinc deposit deposits on the Asmara Project in Eritrea is currently being since 2003. The Asmara Project currently examined in a covers about 600 square kilometers in feasibility study central Eritrea and is located north, west, being conducted and south of the capital city of Asmara. by Senet (Pty) Ltd The infrastructure on the project is and AMC Consul- excellent, with roads, power, and water tants Pty Ltd and available though out the project area and is expected to be access to the port of Massawa is only complete by the 120 km away by road and rail. end of 2011. The Debarwa de- Sunridge has defined four mineral depos- posit hosts a 3.3m its on the Asmara Project and is currently tonne (NI43-101 Snowden Mining Industry Consultants conducting a full feasibility study on the Measured and Indicated) resource which Inc and GBM Minerals Engineering Debrarwa copper-gold-silver-zinc VMS includes a gold oxide zone, a supergene Consultants Ltd are currently conduct- deposit and a prefeasibility study on the copper zone, and a primary copper and ing a prefeasibility study of the Asmara Asmara North deposits, which include zinc zone. Within the copper supergene North Deposits which include 3 deposits the large EmbaDerho copper-zinc- zone there is a zone of high-grade copper with 6 km of each other: gold-silver VMS deposit, the • EmbaDerho: 62.5 Mt (Ni43- AdiNefas zinc-copper-gold- 101) Indicated copper-zinc-gold- silver VMS deposit, and the silver resource with a copper-rich Gupo Gold deposit. zone containing 38.4 Mt averag- ing 1.02% Cu and 0.99% Zn. The three VMS deposits have • AdiNefas: 2.7 Mt (Ni43-101) a total (NI 43-101) Indicated Indicated high grade zinc-copper- resource containing: gold-silver which averages 8.38% • 1.3Blbs copper Zn, 1.39% Cu, 2,85 g/t Au, and • 2.5Blbs zinc 99.3 g/t Ag. • 1.0Moz gold: and • Gupo Gold: 4.5 Mt (NI 43-101) • 31.7Moz silver Inferred resource which averages 2.99 g/t Au. In addition, the Gupo Gold deposit has an (Ni 43-101) Inferred resource containing Exploration 189,000oz of gold. Although Sunridge has had tre- estimated to contain 41 million pounds mendous exploration success since 2003, Debarwa Feasibility Study with an average grade of 16.0% copper, 3 the Asmara Project remains only partially g/t gold, and 77 g/t silver. The feasibility explored and Sunridge geologist have study is examining options to fast track identified several highly prospective ex- this high-grade portion ploration targets. Many of these are drill of the supergene zone ready and Sunridge is planning further to production by being exploration drill programs for 2011. operations by mining, crushing, and direct ship- ping directly to a smelter without the need for a Company Address and contact details concentrator. Sunridge Gold Corp. Suite 1490 -W Georgia Street The Asmara North Vancouver, BC Deposits Prefeasibility Canada V6E 3C9 Study tel, +1(604) 688 9478 fax: +1(604) 688 9458 www.sunridgegold.com

14 Company Profile NGEx Resources Inc

NGEx, through its Eritrean subsidiary resource of 10.7Mt at 0.98% Cu, 2.25% Sanu Resources, has been actively ex- Zn, 0.20g/t Au and 6.8g/t Ag. Hambok is ploring Western Eritrea since 1998. Us- hosted in similar lithology to the Bisha ing exploration techniques ranging from mine, 15kms to the north. In the coming exploration season, Sanu is planning fol- low-up drilling on its gold-rich Aradaib VMS prospect and reconnaissance holes on blind geophysical targets from the airborne survey flown earlier this season. The exploration of over 10,000km2 in the northern end of the Dallol evaporite Western Eritrea has produced a huge basin. Shallow potash deposits have re- volume of high-quality regional-to cently been discovered at Kolluli, 20kms property-scale exploration data. Having south of Bada, and advanced exploration relinquished over 90% of its original land projects are underway on the historic holding, this data is now the property of Dallol basin potash deposits in Ethiopia. in-house processing of satellite imagery, the Government of Eritrea. airborne EM and magnetics, gravity, Company Address and contact details sampling, mapping, and prospecting, Potash deposits are the focus of NGEx Sanu has defined new mineralized vol- subsidiary, Bada Potash, who is drill- NGEx Resources, Inc canic belts and drilled over 20km on 13 ing in the Danakil Depression, 150km 2101-885 West Georgia Street new gold and VMS prospects. In 2006 southeast of Asmara. After a six-month B.C., Canada V6C 3E8 Vancouver Sanu discovered the blind Hambok mas- program of geological mapping, ground Tel: + 1 604 689 1337 sive deposit and in early 2009 announced mag, and gravity profiling, NGEx is ex- Fax:+ 1 604 689 4250 an NI43-101 compliant indicated cited to be drilling the first ever holes in www.NGExresources.com Adobha Resources (Eritrea) Pty Ltd Gerassi South EL Geophysics Adobha Resources Eritrea (ARE)a wholly The southern part of the Gerasi South ARE is currently compleng a large scale owned subsidiary of Gippsland limited, area includes structurally controlled, airborne VTEM and magnec survey a publicly listed company based in Aus- vein hosted gold mineralizaon which is over six blocks selected on the basis of tralia and listed in both Australian and interpreted as the extension of the struc- Themac Mapper anomalies and geo- Frankfurt Stock exchanges, is currently ture which hosts the Koka gold deposit. logical interpreted structural sites. exploring two conguous Exploraon Extensively sheared, intensely sericite Licences located in the Adobha region altered and hemate oxidized felsic Future work of Northern Eritrea. The Adobha and volcanic and sediments intruded by felsic Geochemical sampling, geological map- Gerasi South ELs covers 2,200km2 of the dikes (micro-granite) are cut by mineral- ping will be ulised to follow-up all of Nubian-Arabian Shield that is considered ized quartz veins. to be prospecve for volcanogenic mas- the geophysical targets. The more inter- sive sulphide (VMS) deposits The mineralized quartz vein is vuggy esng of the airborne VTEM anomalies bearing galena crystals and stringer, Regional geological mapping combined pyrite, in places malachite and other with some detailed mapping in the sulphide material with hemate and northern and central part of the Project other sulphide oxidaon. The host rock area confirms that the geological seng is moderately hemate oxidized and is consistent with that expected in a intensely sheared at the contact. VMS environment and shows similari- es with the geological seng of the Adobha EL large Bisha Au-Ag and Cu-Pb-Zn de- Geological mapping of the Adobha posit 200km along strike to the south. project area confirms that the geological The southern most of the Project area seng of the area is consistent with that (Gerassi South EL) is similar to that of expected in areas where volcanogenic will be followed by ground geophysical the structurally controlled Koka Gold massive sulphide (VMS) deposits are survey (IP and/or gravity). Deposit which is hosted in veins within a known to occur. This is supported by micro granite some 16km to the south. heavy rare earth geochemistry which Company Address and contact details The Koka hosng structural feature ex- indicates that the region is prospecve S.A. Building 8th Floor, #802 tends to the north into the ARE ground for VMS deposits. Regional drainage 189 Warsay Street where it is represented by strongly geochemical sampling followed-up with tel: +291 1 111469/70 shearing, sericite-hemate-limonite rock-chip sampling has located outcrop- fax: +291 1 111468, alteraon with malachite, galena and ping copper mineralizaon in the form of PO Box 4076 Asmara, Eritrea other sulphide mineralizaon. malachite. Website:- www.gipslandltd.com

15 Company Profile grained cubic pyrite. The Taninay vein London Africa generates drill targets is developed parallel to the foliation of the tuffaceous schists, dipping generally London Africa Ltd. is a private resources although the low lead, zinc and barium 40-60 degrees west and striking around company registered in England and in grab and soil samples seem not to 160-170 degrees. There is some evidence Wales, in 2005, to apply for prospect- favour that idea. The presence of garnets of shearing in the immediate wallrocks, ing license in Eritrea. The company was at Gerger and wollastonite in the main but the vein itself appears to be un- awarded 1562 km2 prospecting license carbonate horizon, on the other side, is sheared and of a single quartz generation, in the Akordat-Orota corridor area of suggestive of a Cu-Au skarn or IOCG in contrast to the complex sheared veins Ghash Barka Zone, in Central Eritrea. environment. typical of most mesothermal auriferous Following a 12 month prospecting pe- quartz-sulphide veins. The wallrock ap- riod, the company converted the ground The company has completed detailed pears to be generally unmineralised and into an exploration license in June 2010 mapping, extensive soil sampling and only weakly altered. reducing the overall size of the area to a ground gravity survey of the area. All 1169 km2. Since then the company's data is currently being integrated with Grab sample grades of up to 55.5g/t Au exploration team has identified numerous the results of a helicopter-borne VTEM have been recorded with other notable gold and copper prospects. survey flown earlier this year with a view grab samples assaying at 15.18g/t Au and to identifying drill targets for drilling in an average of over 4g/t Au. Preliminary Kofot-Gerger Cu-Au-Fe prospect: Q4 2011. channel samples are currently being Located in the northern half of the completed and so far have returned re- license area, the Kofot-Gerger prospect Taninay Au prospect: sults of 4.88g/t Au, 4.66g/t Au & 3.85g/t lithological succession includes a number Taninay Au prospect lies around 25 km. Au. Detailed mapping has been com- of units mapped as 'gossan' which have northeast of Akordat, and is characterized pleted to 1:2000 scale. Channel sampling been sampled fairly extensively and have by a prominent NNW-trending quartz should be complete by September 2011 returned significant anomalous copper vein, that appears to have over 2km ex- and drilling is expected to start in Q4 and gold grades of up to 4.5% Cu and posed length and an overall length of 10 2011 4.6g/t Au. km and 30-40 meters width. Company Address and contact details London Africa(Eritrea) Ltd. Geological setting and mineralization Erratic gold grades are associated with studies, show the presence of gossans, limonite occurring in irregularly dis- S.A Building 4th Floor. Asmara, Eritrea exhalites and banded rhyolites, that sug- tributed aggregates in the quartz vein, Tel. +291 1 111165 gest a potential for VMS-style deposits, which are probably derived from coarse www.londonafrica.co.uk Sahar Minerals Ltd

Sahar Minerals Ltd is a privately reg- 1935 and 1939 with a reported produc- istered Exploration Company out of tion head grade of 11.4g/t gold from Bermuda that was established in early seven vertical work faces and three (3) 2009 to take advantage of undervalued Adits assets in the Exploration/Mining Indus- try, that occurred as a result of the world Sahar’s work in Augaro project, follow- wide ‘Credit Crunch’ in late 2008. The ing independent SRK geologists’ report, company is committed to a commodity focused mainly on regional and prospect focus on gold and base metals evaluation, database assessment and After assessing opportunities in Kenya, validation, regional soil sampling, and in Tanzania, Mozambique and Zimbabwe, promising areas rock chip sampling and In Harab Suit Project also, after getting Egypt, Sudan and Eritrea, Sahar identi- detail geological mapping were undertak- independent SRK geologists’ report, fied 2 Projects in Eritrea for acquisition en. Following prospect evaluation, detail regional geological mapping, stream (Augaro & Harab Suit). The Augaro work and target generation 13,802 m was sediment and soil sampling, and prospect Joint Venture Agreement between Sahar drilled by RC(Reverse Circulation). scale mapping and rock chip sampling and ECEM was signed on the 3rd Febru- was undertaken. In Kolentite and Bajew- ary 2010 and the Harab Suit Exploration AUGARO ab Prospects gravity survey was conduct- License Area was granted to Sahar (by ed and following target generation work the Ministry of Energy & Mines) on the The Augaro License Area covers most of 4,000m RC drilling in both Kolentite and 19th February 2010. the historical ‘Augaro Gold Camp’ that Bajewab Prospects is planned. extends south-southwest for a distance HARAB SUIT of 70km, in a belt approximately 25km Company Address and contact details wide. The ‘Gold Camp’ was the largest During the Italian colonial period (1891 producer of gold in Eritrea during the Sahar Minerals Ltd . – 1941), the Tamanti Gold Mine (located Italian occupation (1891 – 1941). A total S.A.Building 5th Floor on the Harab Suit Project) was developed of 930 kg of gold is reported to have Warsay Avenue on a deposit discovered in ancient times. been extracted from the Mines at Augaro Asmara, Eritrea La Società Tamanti Company installed and Damiscioba (the most productive in Tel: +291 1 110008 a Mill and worked the property between the ‘Camp’) www.saharminerals.com

16 Company Profile THANI ASHANTI Thani Ashanti is a recently–formed and Shalatyne. The 1,760 km2 Hondine successful survey has interpreted the Strategic Alliance between AngloGold concession contains the historical Hutite data and commenced follow-up sampling Ashanti and Thani Investments. Anglo- orogenic Au deposit, which is currently over the anomalies. Lease-wide stream Gold Ashanti is the world’s third largest being drilled with two diamond rigs. Ini- sediment sampling will commence after Au mining company and produced 4.52 tial results have been very encouraging, the 2011 wet season. Moz of Au in 2010 from 20 operations including 12m @3.6 g/t Au from 178m across four continents. It has a substan- and 14m @ 2.9 g/t Au from 193m. Work In 2010, Thani Ashanti signed a bind- tial project pipeline and an extensive, at the 627 km2 Wadi Kareem concession ing Heads of Agreement with Stratex worldwide exploration program. Thani has involved extensive surface mapping International to explore for low-sulphi- Investments has extensive knowledge and geochemical sampling and diamond dation epithermal Au deposits in the Afar of developing resource businesses in the drilling is expected to begin in late 2011. Depression of Ethiopia and Djibouti. The Middle East and Africa, long standing joint venture has a 2780km2 of tenure and high level relationships with national In Eritrea, Thani Ashanti was granted the in the afar depression and Thani can governments and major industry players Akordat North and Kerkasha Explora- earn51% of the projects after expenditure in the region. tion Licenses in March 2010. Since then, of $3M over two years. the company has set up an exploration Since inception in 2009, Thani Ashanti office in Asmara, recruited expatriate and Company Address and contact details has quickly built up a portfolio of high local staff and was instrumental in the Thani Ashan Asmara Office quality projects in the MENA region. importation of Geotech VTEM geophysi- S.A.Building 6th Floor In Egypt, two concessions in the Red cal equipment into Eritrea. Thani Ashanti P.O.Box 7216 Asmara, Eritrea Sea desert are currently being explored flew a 10,000 line Km VTEM survey Warsay Avenue from operational bases in Al Quseir at both ELs in early 2011 and since this Tel: +291 1 111202 Andiamo Exploration Ltd copper enriched near-surface zones, The Haykota Exploration Licence is VMS gossan prospects at Yakob Dewar and orogenic gold deposits andskarn- located some 45kms south west along and Ber Gebey, about 2.4 kms apart and type gold mineralisation. The long and strike from the Bisha mine, and appears lying along strike. relatively narrow mineralized belt within to be underlain by similar geology. Since the Felsic Volcanic Domain trends NNW- Andiamo secured the Exploration Li- By year two an airborne VTEM/mag- SSE, along which many of the gossans, cence in 07/2009 an aggressive explora- netic/radiometric survey over the entire exhalative units and other mineralized tion programme has being carried out. Haykota licence area was carried out and oxidized zones are found. However Geologically the Haykota project area during the period January to March 2011. A preliminary set of 16 follow-up the currently identified vein-hosted gold target areas (Zones 1-16) were deposits are mainly concentrated in the identified and ranked. Currently Shambotai area along a linear belt of the target areas are being exhaus- ductile to semi-brittle deformed volcano- tively investigated, including sedimentary rocks. Large numbers of ar- detailed geological mapping, rock tisan miners are active in the Shambotai and chip sampling, trenching as area, as well as Berkele. well as ground magnetometry, Induced Polarisation , and gravity Management surveys. They are now being The management of Andiamo consists of evaluated for the forthcoming very experienced and respected geolo- drilling programme. gists, with extensive knowledge of both Eritrean geology and VMS style mineral- A ground based regional gravity isation. The team also has decades of ex- survey covering an area of 335 perience in the global capital markets for km2 has been conducted (Figure financing junior exploration companies. 1). Reinterpretation of the gravity It has also being Andiamo’s company data is also being done in light policy to employ the best consultants of detailed geological mapping to ensure QA/QC standards are met or and airborne geophysical sur- exceeded. Our objectives specifically in- veys. A regional soil sampling clude the training of appropriate Eritrean programme on a grid of 400 x counterparts. 400 m has being completed in the western lowland areas. An initial Company Address and contact details diamond drilling programme has been carried out in the Yacob De- Andiamo Exploraon LTD. is divided into three major geo-tectonic war and Ber Gebey prospect areas. The Dr Tim Williams: domains, which are separated by major total length drilled is 4099 m. m@andiamoexploraon.com shear zones. 002911-184662; P.O.Box 4588 Exploration work in the first year of the The licence area is prospective both Asmara, Eritrea licence period focused on the two known for VMS deposits including gold and www.andiamoexploraon.com

17 Company Profile China Africa Huakan: Prospecting and Exploration activities underway

China-Africa Huakan Investment Co., contact between the carbonate unit and artisanal workings which strengthens the Ltd. (CAHK) is a joint venture company quartz vein stock works bounded with potential of the prospect. A collection of between China Tianjin Huakan Co. Ltd hetro-lithic tectonic breccia to west. The 60 samples in 2010, showed gold values and China-Africa Development Fund mineralization is mainly associated with >10ppb in the stream sediment sampling Co. (CAD Fund). In December 2009, pyrite-hematite+/-limonite-malachite+/- program with maximum gold value the company acquired an exploration chalcopyrite +/- galena hydrothermal 841.85 ppb. license, 288 km2 in the Anseba Region, alterations within the quartz stock works 35km north of Keren, called Seroa and in and carbonate unit bounded by the brec- From the last season activities three November 2010 it acquired two licenses, cia zone. target areas were selected as potential 334 km2 Mensura prospect in the Gash The company executed deep penetra- sites and intensive exploration activities, Barka region and, Habella prospect 884 tion IP survey and diamond core drilling involving detail mapping, geochemical km2 in the Central region. in 2011 at Enjihai occurrence. The core sampling and ca~2000 diamond core from the first hole ZK67-1 showed a drilling are on schedule for the next work good zone of sulphides at ~120m depth: season in October. Seroa Exploration license pyrites-chalcopyrite-galena. The drill- The mineralization at Seroa exploration ing program terminated due to the rainy On Habella prospect only reconnaissance area is mainly associated with large sized season in June after drilling one hole and geological mapping and geochemical hetrolithic tectonic breccias and quartz will hopefully be commenced on October sampling, that indicated its potential stock works in intermediate plutonic 2011. for VMS deposits, has been conducted rocks (diorites) and shear hosted quartz (results are pending veins striking E-W and NE-SW. The Enjihai occurrence and its vicinities are Mensura and Habella Prospects the main potential sites accentuated by Regional geological mapping and inten- strong geochemical and geophysical sive geochemical sampling in Monsura Company Address and contact details results. The Enjahai prospect is marked area showed encouraging results that by a series of high level intermedi- led to turn the prospect into exploration China-Africa Huakan Investment Co Fah Street ate intrusions along a major center of license. Three representative geophysi- House Number 8 hydrothermal alteration controlled by cal (IP) survey test lines are executed tel. + 291 1151571/185024 the regional Anseba Valley Fault struc- to have a broader understanding of the [email protected] ture. The mineralization occurs at a prospect for further exploration activi- ties. The area is also marked by active

Eritrean-Libyan Mining: Encouraging Prospect of the Fanco and Nefasit License Areas

Eritrean-Libyan Mining Share Co the Fanco-Guluj Exploration License ping (1:5,000 scale), and carried out rock (Eri-Lib) has been actively engaged areas. Gossan outcrops with extensive chip and soil sampling of the following in mineral exploration in Fanco-Guluj alteration zones (haematite, and limonite) prospective areas notably: Mt.Seker, (1,424km2) and Nefasit (1,636km2) li- as well as extensive box works have been Assus-Metkel Abyet, Ayet, Moggot, Adi cense areas for the last 2 years. Explora- found at Wedi Keih. Rosso and Leissa. Moreover, ground tion works conducted to date have identi- geophysical survey fied several gold, and VMS deposits in Recently Eri-Lib commis- consisting of gravity and both concession areas. sioned airborne geophysi- MAG has been conducted cal surveys consisting of over an area of 26.8km2 Geology and Mineralization of electromagnetic (VTEM), at Mt Seker and Assus- Fanco-Guluj Concession area magnetic and radiometric Metkel Abyet areas and The Fanco-Guluj area is the southern surveys over an area of there is a good correlation extension of Bisha Mineralized belt and 916 km2 by Geotech Air- of the geophysical with has similar geology and gold and VMS borne Pty Ltd. The results the geochemical anoma- mineralization. The existence of gold is are expected to arrive lies. Four RC boreholes manifested by the extensive on-going ar- soon. with a total depth of tisanal mining activities at several places 200m were drilled at Mt. Seker copper within the concession areas. Geology and Mineralization of prospect area. Nefasit concession Area The geology of the area comprises of The Nefasit concession, composed of NE-SW – trending Meta-volcanic and low-grade volcano-sedimentary rocks Company Address and contact details meta-sedimentary rock assemblages in- intruded by syn-tectonic granitoids, truded by syn-to post-tectonic intrusions gabbros and diorites, and is affected by Eritrean-Libyan Mining Share Co. with numerous N-S trending, dextral major step faults, horsts and grabbens re- P.O.Box 8980 shear zones. lated to the opening of Red Sea. Eri-Lib Asmara, Eritrea launched regional geological mapping at Tel. +291 1 180345/180358 Eri-lib carried detailed mineral explora- a scale of 1:50,000 of the entire conces- Fax. +291 1 180346 tion activities in six prospect areas within sion area, and detailed geological map- www.erilibmining.com

18 Company Profile Global Resources Development and GENALYSIS

Management Consultants (GREDCO) Setting the standards for quality and customer service.

The Company was founded in Eritrea during 1995 primarily to provide guidance With over 1,000 laboratories and offices globally and more than 30,000 em- on integrated development programmes. Our mission is to contribute to the efforts ployees Intertek is a leading provider of quality and safety solutions serving of poverty reduction and sustainable development with participatory and integrated a wide range of industries around the world. approaches using appropriate technology and expertise that enhances local owner- ship. Our network of Mineral laboratory facilities offer a wide range of services including; The company has teams of experts with complementary skills able to work on • Sample Preparation multidisciplinary studies, networked with a large group of associates based locally • Fire Assay and Precious Metal Analysis and internationally, who have unique experience of Africa. • Exploration Geochemistry • Environmental Services Services • Mine-Site Laboratories • Consulting Services We provide comprehensive, professional and high quality consultancy services, • Minerals Inspections specifically tailored to suit the requirements of the client. The principal fields of • Robotic and Automated Laboratory Systems expertise are the following: • Coal Testing and Inspections

• Environment Genalysis Laboratory Services, an integral part of the Intertek Minerals • Water resources Group, has been servicing the mining and exploration industries for over • Agriculture/natural resources 30 years and is the partner of choice for clients across the globe. Since • Socio - economic studies 2003 Genalysis has had an alliance with African Horn Testing Services • Institutional development, and in Asmara, Eritrea. Recently an agreement was reached between the two • Geo- information services parties for Intertek Genalysis to aquire the assets of African Horn Testing Services. Intertek Genalysis has submitted a business license application to Experience the Ministry of Energy and Mines. Samples prepared in our Eritrean facility will be sent to the Perth Mineral Laboratory for analysis. The company has worked with mining/exploration companies such as Bisha Min- ing Share Co/Nevsun Resources, Sunridge Gold Corp, Sub-Sahara Resources/ Further strengthening our footprint in Africa, Intertek also has established Chalice Gold Mines as well as Ministries / Public Sector Organisations, Inter- laboratories in Johannesburg, Ghana and soon to be Guinea and regional national Organisations and Non-governmental Organisations. Detailed career sample preparation facilities in Namibia, Madagascar and Cote d’Ivoire. In histories will be provided, on request, to potential clients during project design and addition to these facilities Intertek also own and operate an onsite base metal contractual negotiations. laboratory for a client in Ndola, Zambia.

GREDCO 3rd Floor, Saba Building Warsay Avenue Asmara, Eritrea General Exploration Drilling Tel: 002911-186111; Fax: 002911-188190 Email: [email protected] (Cyprus ltd Eritrea Branch)

ADEN Services From a humble beginning in 2005, Rod Trigwell and his team of profes- sional fellow workers have molded General Exploration Drilling Cyprus ltd ADEN Services is an international leading provider of Integrated Support Services Eritrea Branch into the largest multipurpose drilling contractor operating in headquartered in Shanghai, China. With over 12,000 employees worldwide, the Eritrea, with operations in North East Africa. company serves over 500 clients in more than 750 locations. Through a network of 32 branches across Asia, Middle-East and Africa, ADEN General Exploration Drilling Cyprus Ltd Eritrea Branch provides services in Services offers its clients: all drilling techniques including reverse circulation , grade control drilling, RAB drilling ,Geotec drilling ,diamond drilling and de-watering bores using • Remote Site Management the most up to date drilling, sampling methods and equipment available. • Maintenance • Security The fleet of 11 rigs ranges from small scout portable drills with a diamond • Cleaning drilling capacity of 250 meters, to large multipurpose tracked rigs equipped • Foodservice with separate high pressure 900 CFM X 350 Psi compressors for reverse circulation drilling with , track mounted diamond drilling rigs with capacity ADEN Services Remote Site Division specializes in supporting remote site opera- to 600 meters. tions for the oil and gas, mining, construction and heavy industry sectors. The com- pany provides life support services for projects in these sectors including technical Administration and field support are provided by efficient and well co- assistance, audit and consulting, logistics, manpower placement and procurement ordinated personnel operating from modern office and workshop facilities. A as well as full camp management services, which include foodservice, cleaning and large supply of drilling spare parts and drilling consumables are available for housekeeping, laundry, maintenance, landscaping, waste management and social immediate dispatch to keep the field operations running smoothly. entertainment. General Exploration Drilling Cyprus Ltd Eritrea Branch aims to continue upgrading and modernizing their fleet of rigs and equipment to provide mining and exploration companies with the most professional and efficient service available.

Eritro-German Building Floor 5 office No.1 Tel/Fax. +291 1 125829 [email protected] http://remotesite.adenservices.com Asmara, Eritrea [email protected]

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