Exploration started in liberated Eritrea in 1996 straight after the promulgation of the Mining Law. The level of participation by foreign companies has increased significantly following the discovery of the high-grade VMS deposit at Bisha.
There are more than 14 mining and exploration companies operating in Eritrea from Australia, Bermuda, Canada, China, Libya, the United Arab Emirates and the UK.
These companies collectively operate 34 projects. They include some advanced exploration sites (where mineral resources have been established, and, in some cases, where scoping level and feasibility studies are completed) to early-stage prospecting projects (where reconnaissance mapping is being carried out).
The total area covered by exploration and mining activities is near 14,000km2. As a result of exploration during the past ten years, mineral resources have been identified containing over 3Moz gold, 41Moz silver, 1,600Mlb copper and 4,200Mlb zinc.
In addition to these resources, the level of interest to secure new ground by existing as well as newcomers is increasing.
The Ministry of Energy and Mines classified the companies operating in the country as “Development Stage Companies” and “Exploration Companies”
DEVELOPMENT STAGE COMPANIES
The number of companies that have reached the development stage have increased in recent years as investor confidence returns.
1) Bisha Mining Share Co (BMSC)
BMSC is a joint-venture company owned by Eritrea’s National Mining Corp (ENAMCO) and Canada’s Nevsun Resources Ltd. Its main mineral properties include the Bisha property in the west. Bisha contains a high-grade gold, copper and zinc deposit and other satellite deposits.
The Bisha mining licence was granted to BMSC in January 2008 after exploration, which started in 2002, and which produced a positive feasibility study. The project has already started a production of 1,000 oz of gold daily.
2) Sunridge Gold Corp
Sunridge Gold is a junior Canadian mineral exploration and development company which holds three contiguous exploration licences – namely Medrizien, Debarwa and Adi Nefas. The licences partially surround Asmara and hence collectively are known as the Asmara project.
3) Chalice Gold/Sub-Sahara Resources
A prospecting licence was originally granted in 1998 to Dragon Mining in a locality known as Zara in the north west. After a one-year regional reconnaissance, the licence was converted to an exploration type.
Since then, all operation and management has been assigned to Australia’s Sub-Sahara Resources, which has been actively exploring in Eritrea for the past nine years. The initial properties that Sub-Sahara secured contained the VMS prospects surrounding Asmara but this entire land package was sold to joint-venture partner Sunridge in 2007.
Since then, Sub-Sahara has focused on the Zara project, and was rewarded with definition of over 1.0Moz of gold at the Koka prospect with an average grade of 6.31g/t gold. During the credit crunch, the company had to halt all operations for almost a year and reduce its employees.
Sub-Sahara was then taken over by Chalice Gold Mines Ltd, which now funds the project completely.
4) NGEx/Sanu Resources Inc
Based on previous exploration works, Sanu continues its exploration activities in the Kerkebet and Mogoraib exploration licences targeting VMS deposits.
Generally, most of the work Sanu has accomplished are database entry, geological mapping and map compilation, and some follow-up and prospecting works in the Kerkebet and Mogoraib licences. The most notable achievement is the discovery of the Hambok deposit in the Mogoraib licence area immediately south-west of Bisha, along with promising drill intersections in Aradaib at the Kerkebet licence area and north of Bisha.
The Ministry has received applications covering a total surface of about 30,000km2. This is a clear indication that Eritrea is becoming an exploration hot spot.
5) Andiamo Exploration Ltd
Andiamo is a UK junior exploration company; still a private company. Andiamo was granted a 723km2 exploration licence in the Haykota area in July 2009, having already identified targets from satellite images and from previous work in the area in 1998 by BRGM/La Source. Andiamo started work on the ground two days after receiving the licence.
The area lies immediately south-west, and on strike, with Bisha, and is adjacent to NGEx/Sanu’s Mogoraib exploration licence to the north, and to Erilib’s area to the south. It is considered to be highly prospective for shear-hosted gold and for VMS-type mineralisation, and already several substantial gossans along an exhalite horizon have yielded encouraging assay values for gold and base metals.
6) Beijing Donia Resources Co
Donia and its affiliate Zhong Chang Mining Co Ltd (also from China) hold multiple licences, including four for iron ore and three for base metals. Exploration work has included geological mapping, geochemical sampling, trenching and a magnetic survey. Investigation for iron ore, however, produced poor results and, after a thorough review of all projects by a new management team, the company decided to relinquish those licences. The precious- and base-metal prospects have been retained and further exploration is committed.
7) China Africa Huakan Investment Co and Land Energy Group (China) Ltd
Both companies are newly arrived from China, and were granted exploration licences in late 2009.
Huakan holds ground at a locality known as Seroa, north-west of Keren (capital of the Anseba region), historically known for its gold occurrences.
Land Energy, on the other hand, has been issued with an exploration licence on a highly prospective area west of Barentu, capital of Gash Barka region. The area is contiguous with, and to the east of, Andiamo’s exploration licence. The town of Gogne is situated at the centre of the licence.
Both companies have focused on collecting stream sediment and soil samples from the entire licence area. The samples were sent to China for laboratory analysis. Both companies have also applied for more ground in Eritrea. Land Energy has shown interest in potash mineralisation alongside South Boulder’s area, and Huakan is looking for two more precious- and base-metal prospects.
8) Eritrea-China Exploration and Mining Share Co (ECEM)
ECEM is a joint venture between a Chinese company and the Eritrean ENAMCO. The principal property of ECEM is the Augaro exploration licence, which covers 1,000km2. The licence area is named after the Augaro deposit, recognised as the biggest gold mine during the Italian colonial period.
Previously, the licence was briefly held by Anmercosa, the exploration wing of Anglo American plc, and then by Nevsun Resources before it was abandoned. ECEM has conducted detailed geological mapping and drilling in the Augaro exploration licence area. Unfortunately, no promising results have been produced and ECEM has opted to bring in Sahar Minerals from Bermuda as a joint-venture partner to take over exploration of the licence area.
9) Eritrea-Libya Mining Share Co (ERILIB)
Eritrea-Libya Mining (Erilib) is a special joint-venture arrangement between Eritrean and Libyan companies formed early in 2009 and issued with two exploration licences in June 2009. The Nefasit exploration licence covers 1,636km2 and lies east of Asmara at the top of the escarpment. The Fanco-Guluj licence is in the west of the country and covers 1,151km2.
On both properties, Erilib has identified multiple targets based on previous works and extensive regional investigations consisting of geological mapping, geochemical sampling and geophysical surveys. Follow-up work continues and target areas for drilling are being identified.
10) London Africa Ltd
This is a London-based private company and was granted a prospecting licensee in June last year known as AK1-11. The area covered by this licence is 1,555km2 and lies in the Anseba and Gash Barka regions.
During the one-year prospecting period, London Africa was able to identify multiple targets that warrant further exploration. According to the law, the licence has been converted to an exploration one, which will permit London Africa to assess the property, initially for three more years until renewal.
11) Nubian Resources plc/Gippsland Ltd
Recognised as Gippsland by the ministry, the company holds prospecting licences at the Adobha valley in northern Eritrea. Interesting results from two fast reconnaissance sampling programmes, the first one of which was aided by helicopter, have led the company to generate target areas for further investigations.
The rock types found in the project area are consistent with those expected in a volcanogenic massive sulphide (VMS) environment and are similar to the geological setting of the large Bisha Cu-Pb-ZnAu-Ag deposit 200km along strike to the south. The presence of widespread copper mineralisation, combined with some high lead values in bedrock samples, significantly upgrades the prospectivity of Gippsland’s Adobha tenements.
Accordingly, Gippsland applied to convert them to an Exploration Licence, and has formally requested more prospecting ground.
These applications have been processed and approved.
12) Sahar Minerals Ltd
Sahar is a Bermuda-based privately held exploration company established in early 2009. After an extensive evaluation process, the company secured two properties in Eritrea in February 2010, namely the Augaro gold-base metal project (held in a JV structure) and the Harab Suit gold-base metal project, which is 100% held in an exploration licence area.
Exploration programs have begun on both projects subsequent to the licence agreement. The management is looking forward to fast-track drilling on both properties.
13) South Boulder Mines Ltd
South Boulder is an Australian exploration company looking for potash in the Danakil depression near the border with Ethiopia. The depression and its surroundings are believed to host several evaporate hosted mineralisation types. After the necessary preparatory works, such as upgrading of road and other infrastructure, and establishment of a camp, the company started a drilling programme in late June.
This is a significant milestone for South Boulder, and represents the first drilling programme undertaken on the prospect in 42 years.
14) Thani Eritrea Ltd
Thani Eritrea is a new partner in the exploration ventures of Eritrea, coming from the Emirates and South Africa (through Anglogold Ashanti’s interest in the joint-venture agreement).
It holds 1,863km2 of exploration ground in two localities, namely Kerkasha in Gash Barka (immediately south of Barentu) and Akordat North in the Anseba region (sandwiched between London Africa and Sanu). Exploration on the ground has not yet started but the company is planning to run airborne geophysics over the entire area.
(Reference: Mining Journal – Eritrea)