MINERAL POTENTIAL OF
THE STATE OF ERITREAYEARLY BROCURE
OF ERITREAN
MINERAL SECTOR- Facts on Eritrea- A word from His Exellency the
Minister of Energy and Mines- About the Department of Mines- Mineral Sector Highlights of 2009
- Mining Law- Geology of Eritrea- Mineral Potential of Eritrea- Investment opportunities and current
exploration & mining activities

2009

Bisha: Plant Site Overview

Dear Investors,

On behalf of my ministry and the government ofEritrea, I am pleased to present to you this profile ofinvestment opportunities in the minerals sector.
Eritrea, the size of England, is strategically located in
the Horn of Africa. Its proximity to the Middle Eastand Europe, together with its major ports in the Red
Sea, enhances its comparative advantage.
Geological works and recent remote sensing investigations proved that Eritrea possesses favorable
geological settings. The greenstone belt of Eritrea,
which hosts precious and base metals, covers 70%of the country. The recent announcements made byseveral exploration companies operating in Eritrea,
have demonstrated the potential Eritrea possess for
major mineral deposits.
A liberal economic policy with competitive tax
regimes, full guarantees and protection of investments, untapped geological terrins, highly motivated,disciplined and hard working people, an administration free of corruption, a safe and free country, make
Eritrea an ideal destiny for investors.

The holder of a mineral license is guaranteed the right to dispose of minerals without
export tax, and to the repatriation of after-tax profits
without restriction. The law also permits financial
losses to be charged against gross income and to be
carried forward. The Eritrean mining law, in addition,
provides simple procedures for the submission andprocessing of license applications.
We sincerely hope that this profile, although not
exhaustive, will guide you and enable you to makesome meaningful decision on how to invest in the
sub-sector of your choice. We invite investors to carryout investment studies to determine the viability ofthese opportunities.
Thank you for your interest in mineral prospecting
and development in Eritrea. We look forward toassisting you to implement your investment.

Ahmed Haj Ali
Minister of Energy and MinesMineral potential of Eritrea

A highly prospective country Location, climate, geography
and infrastructure
Eritrea joined the world community of independent
states in May 1993 following a thirty year war for
liberation which ended in May 1991. A UN supervised referendum held in April 1993 enabled theEritrean people to state unequivocally to the world
their strong choice for freedom and independence.
Aware of the significant and vital role the private
sector has to play in the achievement of national
development objectives, the Government of Eritrea
has been committed to create a conducive atmosphere for the active participation of local and foreign private investors. However, since May 1998 thedevelopment of this young state has been severely
curtailed by the border dispute with neighbouring Ethiopia. Despite this, the Eritrean people andGovernment are as resolute as ever in their commitment and endeavours to work together to rebuild
their country’s economy, and to secure social andeconomic progress.

This young state is located in the north-eastern part ofAfrica with the Red Sea on its east coast, Sudan to the west
and north, and Ethiopia and Djibouti to the south. Eritrea,
with a land surface area of about 125,000 square
kilometres, including hundreds of coral islands in the Red
Sea, has a population of about three and a half million
people. The country is home to nine ethnic groups, all witha strong sense of Eritrean national unity. Tigrinya and Tigre
arethe most widely spoken indigenous languages. English
is also commonly used in the business community, while
Arabic and Italian are also frequently encountered.
The topography of Eritrea is exceptionally varied, from the
1,200 kilometre long coastal plain only a few metres above
sea level, through the central highlands ranging up to 2,500
metres above sea level, to the low lying western and south
western areas of the country. Rugged mountain chains
run from the central plateau to the extreme north of thecountry. The climate in these diﬀerent terrains correspondingly varies from arid, to semi-arid, to temperate. The meanannual rainfall in the coastal areas is less than 300 mm peryear, whilst in the highlands and the western lowlands
rainfall ranges between 500 and 1,000 mm.
3Mineral potential of Eritrea

Eritrea’s infrastructure is centered on a well developed
communications network linking the capital city Asmara to
the regions of the country, including the two main sea portsof Massawa and Assab, and to the neighbouring countries.
Asmara and Massawa have international airports, which
also serve internal flights. Inevitably, the ravages of war
have left their mark on the infrastructure, and the reconstruction of the prime facilities has been a high priority.
Telecommunication facilities have also been renovated anddeveloped, and mobile phones are now a common site in
the major towns.

The Department of Mines

The Ministry has a responsibility to provide preliminary information to exploration companies interested in conducting detailed investigations in Eritrea,
and to make a contribution towards enriching thegeological database of the country. As part of its
routine works, the Department of Mines throughthe Mines Administration Division issues licenses toartisanal miners, and controls and supervises exploration and mining activities so that they are in linewith the directives of the Ministry and are environmentally compliant. In addition, the Department ofMines, through its research wing – the Geological
Survey – has been working, together with various
foreign governmental aid agencies and internationalorganizations, to carry out geological mapping andmineral exploration.

The Ministry of Energy and Mines isthe authorised Licensing Agency andis responsible for the administration,
regulationand coordination of all
types of mining operations in Eritrea.
The Department of Mines within
the Ministry encompasses, amongst
other functions, the Geological
Survey and the Mines Administration
Division, and is also itself actively
engaged in exploration and mapping
activities.
Even though there are several maps
produced on diﬀerent scales fromvarious sources, there have been
only two geological maps, at a scaleof 1:250,000, compiled until recently,
when the Eritrean Geological Survey prepared a
1:1,000,000 scale map.
The Eritrean mining sector has shown rapid development over the past few years since the Ministryof Energy and Mines started issuing licenses in 1997.
Since then, several exploration companies havebeen involved in assessing and exploring the mineralpotential of the country. In the successive years additional licenses have been issued on the first-comefirst-served principle. The Department of Mines
has also been developing a national minerals database.

Signing of an agreement

Some of the activities conducted in 2009 include- Following applications by several explorationcompanies, evaluation was done and licenses were
granted. Seven companies namely ERi-Lib Sh. Co,
London Africa, Andiamo Exploration ltd, South
Boulders, Beijing Donia Resources ltd, Sub-sahara
Resources (Eritrea) ltd, and Zhonzang sh. co have already signed agreement and some of them actually
started their exploration works. More companies
are expected to sign in the near future.

4

Mineral potential of Eritrea- The Eritrean Geological Survey in collaboration
with the Geological survey of Iceland conducted adetailed geophysical survey consisting of Magnetotteluric (MT) and Transient Electromagnetic (TEM)
over the Alid geothermal prospect . The results ofthis survey indicates a good geothermal potential in
the area.
- The first draft of Regional Geological Map ofEritrea, on 1:1,000,000 scale is finalized and is readyfor distribution. In addition other geological maps
on 1:250,000 scale were also produced on specificareas.

Mining law
The legal framework governing the conduct of allmining and related operations within the territory of
Eritrea is embodied in the Mining Law comprising:Minerals Proclamation No 68/1995, Mining Income
Tax Proclamation No. 69/1995 and Regulations on
Mining Operations Legal Notice No. 19/1995, all ofwhich were promulgated in March 1995.
Key Policy issues upon which the Mining Law isbased include:• All mineral resources in Eritrea are public property. The State has a duty to ensure the conservationand sustainable development of these resources forthe benefit of the people;• The intention is to create a favourable atmosphere for foreign investment in the mining sector.
Due recognition is made of the significant role that
foreign investment and skills can play in the development of this sector and of the capital intensive,
long term, and risky nature of mining investments;• The necessity for formulating regulations which
ensure protection of the natural environment, together with sustainable development of the country’s mineral resources, in accordance with soundprinciples of resource management and land use;

law provides for:
• The right to exploit any commercial discoveries
made pursuant to a valid exploration license;• The right to sell locally or export, free of all duties
and taxes and without being required to obtain any
other authorisation or permission from any other
Government agency, all minerals produced pursuant
to a mining license;• A simple and fair taxation system which recognises the risky nature of mining investments, andhence allows:* Accelerated depreciation (straight line
method over 4 years) of all capitaland preproduction costs;* Write-oﬀs of exploration expenditure incurred anywhere in the country;* The carrying forward of losses;* A generous reinvestment deduction (5% ofgross income);* No dividend tax* A nominal rate of import duty (0,5%) on all
inputs necessary for mining operations;* Normal royalty rates as well as an option
for the reduction, suspension or waiver ofthe royalty in appropriate circumstances;• Equitable foreign exchange regulations permitting;* Free and unrestricted repatriation of earnings;
* Retention of a portion of foreign currency
earnings abroad in external accounts;* Maintenance of foreign currency accounts
in banks in Eritrea.
• A simple “one-stop” licensing system enabling
all the formalities for all types of licenses for mining
operations to be completed by a single Government
agency - the Department of Mines within the Ministry of Energy and Mines.

The Eritrean Mining Law is up-to-date, attractive
and competitive, as it provides considerable benefits and incentives to investors. For example, the5Mineral potential of Eritrea

The mineral licensing system
The Mining Law permits the following types oflicenses:• Prospecting License, valid for one year and nonrenewable;• Exploration License, valid for an initial period of
three years, but which may be renewed twice for
additional terms of one year each, with an option
for further renewals in appropriate circumstances;and• Mining License, valid for a period of 20 years with
optional 10-year renewals.
All of these licenses are exclusive and grant theirholders an automatic right to obtain an Exploration License from within a Prospecting License
and a Mining License from an Exploration License,
subject to the fulfillment of the obligations under
the preceding license. Although the maximum areathat a single license can cover is fixed at 100km2
for a Prospecting License, 50 km2 for an Exploration
License and 10km2 for a Mining License, simultaneous possession of multiple contiguous licenses ispermitted.

Applications for any of these licenses may be madeby individuals or legal entities of any nationality. Allapplications are to be made on specified forms thatcan be obtained from the Department of Mines

Above the cloudsof the Ministry of Energy and Mines and must be
accompanied by a nonrefundable processing (registration) fee of US$1 per page of each applicationand the supporting documentation presented. Successful applicants are also subject to a payment oflicense fees and the first year’s rental upon the issue
of a license. The rate of these fees is governed byRegulation and is at present as follows:

Prospecting

License Fee(per license)
US$(approx.)
80

Annual rentals(per km2)
US$(approx.)
8

Exploration

240

32

Mining960

96

License6

Mineral potential of Eritrea

Volcanic Mountain in Southern Eritrea

7

Mineral potential of Eritrea

The Geology of Eritrea
The geological set up of Eritrea is made up of Precambrian basement rocks that are overlain unconformably by predominantly Mesozoic sedimentaryrocks and Tertiary to Quaternary volcanic and sedimentary rocks.

Precambrian Basement Rocks
Basement rocks in Eritrea cover more than 60% of
the surface of the country. The basement rocks ofEritrea are part of the Arabian Nubian Shield (ANS)
which are exposed in north east Africa (Egypt,
Sudan, Eritrea, and Ethiopia) and in Saudi Arabia,
northern and northwestern parts of Yemen and partof the western Middle East.
The shield is believed to represent a mega suture
between East and West Gondwana. Archean andPaleoproterozoic continental crust rocks make theolder components of the shield and occupy a verysmall part of the basement rocks and the majorpart of the shield consists of Neoproterozoic (c. 870670 Ma)
continental-marginal and juvenile intraoceanic magmatic-arc rocks.
In Eritrea, the basement rocks are not well studied
despite their high mineral potential. The two geological maps so far completed cover the westernpart of the country (Geology of Gash River Area) andthe southern part of the country (Geology of Mai
Dima/Kohain Area). Compilation of geologic maps
at 1:250,000 scale has recently been completed
for four map sheets. Other studies, based largely
on satellite image interpretation aided by limited
ground controls, suggest that the rocks can be subdivided into four tectonic blocks or segments, separated by tectonic boundaries. Three of these blocks,
the western, central and eastern segments, underlie
northern and central Eritrea, whilst the fourth, theDanakil segment, occurs in the southeastern part ofthe country.

The western segment, the Barka Terrain - is exposedin the northwestern part of the country and underlies the Barka lowlands. It is made up of amphibolite, amphibolite-facies pelitic schists containing
kyanite and staurolite, quartzites and marble.
The central segment, referred to as the Hagar
Terrain,extends from the Barka River up to the
Adobha Abi valley in the east, and comprises several large elliptical bodies of various tectonic units
that are dominantly composed of oceanic and accretionary wedge materials. Occasionally, layered
sequences of chloritic schists are seen, inter-layered
with epidotic and chloritic metabasalts, occasional
thin and discontinuous marbles, and manganiferous
and ferruginous cherts. The Hagar Terrain displays
an east verging thrust contact with the adjacentsegment to the east. The Hagar Terrain is known tobe prospective for chromite, platinum group elements, nickel, gold and copper mineralization.
The eastern segment- the Nakfa Terrain - is boundedby the Adobha Abi valley in the west and by the Red
Sea escarpment to the east. It is made up of calc-alkaline volcanic and volcaniclastic rocks conformably
overlain by a metasedimentary sequence of chlorite
schists, grits and polymict conglomerates with occasional pelitic sericite schists and carbonates. The
metavolcanic rocks are intruded by variably deformed plutonic to hypabyssal calc-alkaline
bodies. The sequence is cut in places by post-kinematic granites and gabbros and is also transectedby several narrow shear zones sub- parallel to theregional strike. The Nakfa Terrain is considered torepresent a relict island arc assemblage. Several
VMS (Volcanogenic Massive Sulphide) base metal
deposits and gold showings are associated with thistectonic unit.
The southern segment - The Danakil Terrain - iscomposed of metamorphic rocks which may begrouped into three formations:(1) migmatitic hornblende biotite gneisses;(2)a phyllitic formation consisting of schists, conglomeratic phyllites, crystalline limestones, andgraphitic schists; and(3) post-tectonic granitoids.

8

Mineral potential of Eritrea

9Mineral potential of Eritrea
Recently compiled geologic map of the whole country at 1:1,000,000 scale has divided the Precambrianbasement rocks into 7 domains, 5 groups and 3 formations. It is a rather detailed presentation of therocks units of the country.

Mesozoic Sediments
The lower Mesozoic sediments are represented by
the Merbet (Adigrat) Sandstone which outcrops inthe southern part of the country and in the Danakil
area, and is commonly intercalated with siltstones
and hematitic layers. It lies unconformably over thinlayers of conglomeratic sandstones which, in places,
appear to have the characteristics of a glacial deposit. Overlying the sandstone is the Jurassic Adailo(Antalo) Limestone. This unit is exposed over a large
area in the Danakil and is made up of limestones
that are compact, partly shelly, fossiliferous andlayered. Alternations of quartzitic layers are present
in the lower part, whilst towards the upper part thesequence becomes mainly gypsiferous to dolomitic.
The Upper Sandstone forms pockets of sandstones
that have been preserved from erosion. Commonly
this sandstone is medium to coarse grained, lightcoloured, and dominantly quartzitic but partly conglomeratic.

Tertiary Volcanics and Sediments
The Tertiary volcanics can be divided into threeunits:(1) the plateau-forming Tertiary basalts that are
predominantly olivine basalts with intercalations ofintermediate lavas and tuﬀs;(2) the lower Afar stratified basalts composed ofbasaltic lava flows and tuﬀs that are usually foundintercalated with sediments of the Danakil Formation; and(3) the Afar Basalts composed of recent lava flows
and volcanic cones, with minor acid to intermediate
volcanics, mainly trachytes, rhyolites and ignimbrites. The Tertiary basalts are currently actively
exploited for aggregates.

The Tertiary Sediments
The Tertiary sediments lie along the Rift escarpment
and in central Afar. Three sedimentary formations
have been identified: the Danakil, Dogali and Desset Formations. The Danakil and Dogali Formations
are of late Tertiary age and are composed mainly of
limestones intercalated with conglomeratic sandstones and siltstones. They are overlain by calcareous sands with coral reefs, partly consisting ofpebbles of volcanic origin, and gravels with sand, silt
and clay horizons. The Desset Formation comprises
sandstones, clays and fine beds of anhydrite and halite unconformably overlying the Dogali formation in
the northern part of the coast, while the Red Series
containing coarse clastic fresh water sediments occupies the southern part of the coast.

Quaternary Sediments
A thick evaporitic formation of bedded halite, gypsum, anhydrite, potassium and magnesium salts,
with shell material fills the basin in the Danakil Depression. Deposits of sheetflood terraces, silt, sandand gravel are present in some locations occasionally covered by wind blown sands. Basaltic flows andrelated spatter cones represent Quaternary volcanic
activity in the Danakil region.

Mineral potential of Eritrea
Although Eritrea has a long history of mining, modern mining, began at the beginning of the 20th century following the Italian colonization of the country.
Following the Second World War, mining and related operations continued throughout the country, although intermittently. In the early seventies
this resulted in the development of the short-lived
modern mine at Debarwa, before the independence
struggle forced its closure.
Eritrea is becoming a demonstrated potential tohost significant VMS deposits after the discovery
of Bisha, Harena, and Hambok Massive sulphide
deposits in the western lowlands, Koken in the12Mineral potential of Eritrea
northwestern lowland. Zara shear-hosted gold andthe recent findings in Harab Suit and Seroa prospects and Embaderho in the central highlands are
additional examples. Moreover, more findings suchas deposits which include Debarwa , Adi Nefas and
Ketina and many other small prospects has madethe country to be known in such type of mineralization.
The potential for shear hosted gold deposits is also
demonstrated from the recent, gold discovery in
Zara. Exploration work was conducted over a smallarea, situated along a major shear zone that runs
across the country. Although there are many prospective areas waiting to be discovered, the country
is not well explored.
Eritrea possesses a geological setting that is favourable for both precious metals and base metal mineralization, as well as for industrial minerals. The
range of identified potential deposits covers gold
and other precious metals, polymetallic massive sulphide types and quartz vein and quartz stockwork
type of deposits. There is an indication of the occurrence of Nickel and chromite showings associated tothe ultrabasic rocks in the far north of the country.
Occurrences of potash and sulphur evaporates inthe Danakil depression, and a variety of construction materials, including marble, granite and others
in several parts of the country is also well known.

Gold
Recent exploration activities have proved that gold
occurrences are very widespread in many partsof Eritrea and the country has a great potential indeveloping gold deposits. In addition to the previously known areas of primary gold occurrence in thecentral highlands (which includes the Hamasien gold
field), those of Shillalo (in southwestern lowlands)
area, and those of southern Eritrea, exploration
activity in the last decade has shown the presenceof economic gold deposits in the western lowlands
and also in the northern part of the country. Amongthese are gold associated with base metals in Bisha,and gold showings in Haykota area, southeast of
Tesseney areas and in northern Eritrea(Zara).

The average head grades in most of the historicvein gold mines that were active during the Italiancolonial time up to the late 1950s, were reported
to be as high as 25 - 45 g/t, with reasonably good
recoveries.
Eritrea’s gold mineralization is usually hosted inquartz veins and stockworks, and in particular inshear zones associated with felsic volcanic rocks,
dioritic intrusions and in various schists that are
frequently sub-parallel to the strike of the pronounced cleavage of the host rocks. Occurrencesof gold within exhalative VMS deposits, and in theweathered and supergene zones overlying them,
are becoming more evident with recent additional
discoveries of gold in Debarwa and Adi Nefas (in thecentral highlands), and at Bisha and Harena (in thewestern lowlands).

Base Metal Deposits
NNW to NNE-trending belt of gossans, exhalativecherts and altered felsic rocks that are indicatorsof massive sulphide mineralization are recorded inmany parts of Eritrea. The ores of these massive sulphide deposits are predominantly chalcocite, pyrite
with minor amounts of sphalerite, chalcopyrite andbornite. A major belt of massive sulphide depositwith gold and base metal mineralization passes
through Asmara and includes Debarwa, Adi Nefas,
Embaderho and many other localities roughly within
a 50 km wide belt over a strike length of 250 km,
extending for more than 50 km north of Asmara andupto the Eritrean border to the south.
The belt that includes the Bisha VMS and Harena
VMS deposits in the Western Low lands has alreadyproved the presence of world class deposits andis also being explored for additional discoveries.
There are VMS indications farther north of Kerkebet,
Harabsuit and possibly surrounding areas. There isa belt of copper mineralization in Raba-Semait area,sulphide-rich gossanous rock in Mt Tullului(Bedeho)
in Sahel, northern Eritrea and in Mt Seccar and
Sheib areas in the Eastern Lowlands.

13

Mineral potential of Eritrea
At Bisha, a world class deposit of precious andbase metal VMS deposit has been found. Recent
exploration work in Adi Nefas VMS shows 9.0
metres grading 11.91 g/t Au, 285 g/t Ag, 3.18% Cu
and 11.05% Zn and in another test drill NG-043-D– 5.25 metres grading 10.81 g/t Au, 239.8 g/t Ag,
6.77 % Cu and 6.77% Zn has been obtained. Reserve
estimation made recently has shown that minablezinc, copper and associated gold is present in Adi
Nefas.
Embaderho is now emerging as a large base metals(Cu-Zn) deposit with some associated gold. Resource estimation is still going on, however at thisstage it is confirmed that is big a base metal deposit.
Overall in terms of mineral potential assessement
and geological work, much of the country remains
unexplored, despite the several discoveries that are
being made.

Industrial Minerals
Potash, sylvite and gypsum-bearing evaporates occur at Colluli, south of Bada. Substantial deposit of
the latter are found at Desset area, north-west of
Massawa. Large deposits of common salt also occur
at several places along the Red Sea coast.
Considerable quantities of high quality silica arefound at Merbet, which has been exploited for glass
manufacture. In addition, deposits of silica sandwith feldspar occur at various wadis of Eritrea. Highpurity feldspars occur in pegmatites at Lahazen,
35 kms south of Massawa. Sub economic deposits
of mica, which was once exported by the Italians,
are found south east of Lahazien. Large depositsof kaolin occur in the lateritic horizon in parts of
Teraimni, at Adi Koteio close to Adi Kwala, Adi Keih,
Zeghib, Adi Hawusha, Adi Ahderom and west andsouth-west areas of Himbirti.
Extensive deposits of the raw materials for cement
manufacture are found at Adailo, close to Tio withall the constituents including limestone, marl, clay
and gypsum occurring close together.
Barite occurrences have been identified around theHeneb, Meter and Gharsa wadis to the north westof Mersa Gulbub. Barite veins also occur associatedwith faults in the sediments of the Dogali and Desset Formations. Other barite deposits of economic
significance, with reported grades of 95-97% are
known to exist at Debarwa and Ketina. Gypsum deposits are also found in the Desset plains.

Construction Materials
Large deposits of marble occur as belts running
north-northeast including in the Gogne area extending from Gogne to Goranda, and in the Adobha area.
Other significant marble deposits occur at Afhimbol,
Amberbeb, and Mt Kuruku (in the upper valley ofBarka). The Kertse-Komte and Debri black and graymarble deposits occur south of Decamhare andhave been exploited for a long time. Recrystallised
limestone deposits with variegated colours occur at
Dichinema area, in the southwest of Eritrea.
Granites of various colours and textures are exposed over large areas. Granites of dimension stonequality, which are currently being exploited, occur
at Geleb (pink granite), and in the Arato, Korbaria,
and Tukul areas (grey granite). The Mai-mine granite
and Elabered granite are also suitable candidates for
dimension stone.
A narrow outcrop of coral limestone extends along
the coast from the headland of Ras Kassar to thecoastline of Tio. Immense deposits of limestone occur in the Adailo-Aitosh area south-west of Tio.

Geothermal Potential
The possibility of the economic exploitation of thegeothermal heat for power generation occurs in therift area, associated with volcanic activity. Alid, Nebro, and Dubi are the main target locations where
geothermal activity is known to be intensive. Lower
temperature activity also occurs at Mai Wuui, 30
kms west of Massawa.
Geothermal activity, evidenced by fumaroles andhot springs with extensive alteration of the ground,
are abundant in the Alid geothermal field. Studies
14

Mineral potential of Eritrea
carried out so far in this area indicate the presenceof a possible sub-surface high temperature reservoir. The geothermal manifestations at Nebro andDubbi are also promising, but further study will
be required to estimate the reservoir temperature.

High temprature geothermal Fumarole at Alid

15

Mineral potential of Eritrea

CURRENT LICENSES STATUS
The number of exploration companies operating in
Eritrea (existing conpanies include Bisha Mining Sh.
Co., Sub-Sahara Resources (Eritrea), SunridgeGold(Eritrea), Sanu Resources, Eritrea-China Sh. Co. andBeijing Donia) has increased with the recent newly
granted licenses (which include London Africa Mining, Land Energy Group China Co.Ltd, Zhong chang
Mining Ltd, Eritrea-Libya Mining Sh. Co., South Boulder Mines, Nubian Resources Ltd./Gipps land Ltd,
Andiamo exploration Ltd) . The regional distributionof their properties include Central, Western, Southwestern and Northern Eritrea.

Bisha Mining Share Company
The bishadeposit is a large precious metal and basemetal-rich volcanogenic massive sulphide and is a
joint venture between Eritrea’s ENAMCO and Canada’s Nevsun Resources Ltd.
Recently Bisha Mining Sh. Co. has signed an agreement for a $235 million financing debt and thisshows that the company is well on its way to become a producing mine. Housing and infrastructure
for the Project are just about complete and assembly of the Process Plant is well advanced. Production
drills are already working on site and excavators andlarge oﬀ road haulage equipment will arrive towards
the end of 2009. Most of the machinery for the
project is procured and awaiting delivery including
the main grinding mills. Production will commencein 2010; however inwards investment, training andemployment are already beginning to take eﬀect in
the community.
Production will be:Years 1 and 2: Average 431,000 oz Gold per year
Average 702,000 oz Silver per year
Years 3 to 5: Average 170 million lb Copper per
year Plus precious metal credits
Years 6 to 10: Average 220 million lb Zinc per year

Average 40 million lb Copper per year Plus precious
metal credits

Sunridgegold Corp (Eritrea)
The work thus far done by Sunridge, a Canadianmineral exploration and development company, hasresulted in the definition of four NI 43-101 compliant resources on the Asmara Project with total combined metal content of 1.3 million pounds of copper,
2.5 million pounds of zinc, 1.1 million ounces of gold
and 32 million ounces of silver.
The largest deposit is the 63 million tonne Emba
Derho copper-zinc-gold VMS deposit that is locatedjust 12 kilometers from Asmara. An independent
positive Preliminary Economic Assessment study
was completed in June 2009 which shows that thedeposit has the potential to become a large openpit mine producing 60 million pounds of copper, 133
million pounds of zinc and 21,000 ounces of gold
per year. It is anticipated that a Pre-Feasibility Studyon the Emba Derho deposit will commence in the
4th quarter of 2009.
The Asmara Project is considered to be a VMS district with many as yet undrilled targets that warrant
further exploration work. Sunridge plans to drill
many of these targets in the near future.

Sub-Sahara Resources (Eritrea)
Sub-Sahara has been actively exploring in Eritrea forthe past eight years. The initial properties that Sub
Sahara secured contained the volcanogenic massive
sulphide (VMS) prospects surrounding the capital
city of Asmara. The Debarwa Cu/Zn/Au/Ag deposit
was successfully advanced to a ‘Scoping Study’ formining before the entire land package was sold tojoint venture partner Sunridge Gold Corp in 2007.
During 2007, Sub Sahara accelerated exploration activities on its Zara Gold Project (in the north-west of
the country) and was rewarded with definition of a
+1moz gold deposit (Koka) grading 6.31g/t, in early
2008. The Koka Gold Deposit is now in development
for mining through a Pre-Feasibility Study.

16

Mineral potential of Eritrea

Work to date at the Zara Project includes over
17,000m of diamond drilling, independent resource
estimates by Coﬀey consultation firm, metallurgicaldrilling and test-work, structural studies with follow-up drilling, petrographic studies, aquifer development, an environmental baseline study, groundbased chargeability and resistivity geophysical surveys, regional geochemical sampling programmes
and high resolution digital terrain modelling.

Sanu Resources
Based on the previous detail exploration works(geological mapping, geochemical and geophysical), Sanu continued its exploration activities in the
Kerkebet and Mogoraib exploration licenses targeting VMS deposits despite the massive collapse of
the world economy.
Generally most of the works that Sanu accomplishedduring January to July 2009 are data base entry,
geological mapping and map compilation and somefollow up and prospecting works in the Kerkebet
and Mogoraib licenses.
The most significant activity during the year consisted of preparation of a 43-101 compliant resource
calculation of the Hambok deposit. The Hambok
resource estimate was prepared by G.H. Giroux ofGiroux Consultants Ltd, of Vancouver, Canada andforms part of a new 43-101 report co-authoredby Dr. Tucker Barrie and was released in February,
2009.
The Giroux Consultants’ combined indicated andinferred resources at a cutoﬀ grade of 2% zinc were
calculated to be 10.2 million tonnes grading 3.0%
zinc, 1.0% copper, 7.0 g/t silver, 0.2 g/t gold consisting of an indicated resource of 5.1 million tonnes
grading 3.24% zinc, 1.12% copper, 7.8 g/t silver, 0.2
g/t gold and an additional inferred resource of 5.1
million tonnes grading 2.8% zinc, 0.96% copper, 6.2
g/t silver and 0.19 g/t gold.
Moreover, prospecting and follow ups that include
detailed mapping and detailed magnetometer sur-vey were carried out that covered about 350sq.kms
in South West of Koken, Aradaib, Serarat and Southof Halay in the Kerkebet License Area.

Eritrea-China Sh. Co.
In the year 2009, Eritrea China sh. co. has conducted detailed geological mapping and drilling in the
Augaro exploration license area.

Beijing Donia
Beijing Donia Resources Co. Ltd (DONIA) was established in 2004 to deal with geological and mineral exploration of overseas resources. Zhonchang
Mining Co. Ltd (Eritrea) is a newly registered mining
company recently acquired a license in Sheib license
area and is an aﬃliated company to Beijing Donia
Resources Co. Ltd.
Beijing Donia is currently working on its license areas namely Woki-Zagir and Kenatib. The exploration
works include geological mapping and geochemical
sampling, trenching and magnetic survey and will befollowed by drilling.
In addition to the afro-mentioned companies, therecent granted companies include Eri-Lib Sh. Co.,
London Africa Ltd, Andiamo Exploration Ltd, South
Boulders and Zhanzang Sh. Co. Some of them havealready started their exploration works (Andiamo
Exploration) and others are expected to begin verysoon.

Investment Opportunities
The future of Eritrea’s mining industry appears
bright. The prospective geology of the area and therecent discoveries of Bisha, Emba Derho and others
together with an attractive and competitive investment regime makes Eritrea one of the most attractive and rewarding mining investment opportunities.

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Mineral potential of Eritrea
Results of the exploration activities conducted in
the last ten years have proved the high mineralpotential of the country, and that investing in Eritrea
is rewarding. Although all areas of exploration arepotentially prospective, the following are believed
to be more so for investment.

Gold Prospects in South-Western andWestern Eritrea
The south-western part of Eritrea is one of the mostprospective gold regions in the country. It contains
hundreds of small historic mines and operations
that were active during the Italian occupation
including the Augaro mines which was reportedly
the most productive mine in Eritrea. There are also
areas where artisanal gold mining is currently being
undertaken by the local people. Most of these mineral showings and historical mines and old workings
are associated with rocks of: the Augaro-Antore belt
and Bisha VMS and Hykota-Fanco belts.

Deposits in the Augaro-Antore Belt
The Augaro-Antore belt is situated in the southeastern part of Western Lowlands of Eritrea. It stretchesfrom the border in the south to the Barka River tothe north where its extension is masked by intrusions. Localities known for gold in the lower
Augaro-Antore belt include Augaro, Damishoba,
Dase, Tokombia, Ranyo and Doboro. The Augaro
mine appears to have been developed on a series ofquartz veins and stringers, some showing sulphidemineralisation and formed in a low-pressure region
associated with a regional shear zone. The mineralised system is known to extend for a distance of
2,900 metres, of which only about 350 metres wasmined. The main quartz vein, about 240 metres
long, and having an average width of 10 metres,
ends in a stockwork of stringers. The main en-echelon system extends over a strike length of 300 metres with widths of 20 – 30 metres. The recovered
gold grade is reported to have been 30 – 40 grams
per tonne and production during the periods 1933
– 1941 and 1955 – 1956 is recorded at 874 kg, although it is widely believed that the actual production was greatly in excess of this estimate. The mine

was closed in 1941 due to war and all its mining
equipment was removed. It was re-opened briefly
in 1955 to re-treat the tailings. Other interesting localities in this belt that reached production include
Damishoba, Dase, and Ranyo. Doboro, Tokombia
and several others were still at the development
stage, involving pitting and underground exploration, when the Italian occupation ended in 1941. In
the southern part of the belt operations at Antore
and Damanoshila, and in the eastern zone of theBerbere River, all were at various stages of development before the Second World War. In the northernpart of the belt, at Suzena, prospecting started in
1932, and mining was carried out from 1937 – 40.
Drift on three levels were developed, but work wasabandoned on the fourth level due to water problems.
Gold has also been discovered by the local artisanalminers at a number of places in recent times. These
are indications of the high gold potential of the area.

Deposits in the Bisha VMS Belt
Based on regional works and satellite image interpretation, the Bisha VMS and associated volcanosedimentary belt is estimated to have a maximum
width of about 30 kms and extends for more than
100 kms to the south, while its northern extension
is not clear. This belt is believed to be highly prospective and may continue for a substantial distanceto the north as well as to the south. In addition,
records of past exploration in this area indicatethat quartz veins with varying gold contents havebeen reported from some locations including Okere(Okreb). Some of these were prospected and exploited before mining stopped due to WWII.

Gold & Base Metal Prospects in Southern
Eritrea
There are indications of the continuity of the Asmara/Debarwa VMS belt for long distance to the south.
Outcrops are known of gossanous rocks, exhalatives and rock assemblages (felsic and mafic) suchas those of the Debarwa area, in the Ketina area.
There are also many places where local people are18

Mineral potential of Eritrea
conducting artisanal mining. The area west of
Ketina could represent another belt of mineralization, as there are areas of recently discovered artisanal workings south of Monsura area,that are its northern extension.

Gold & Base Metal mineralisation in
Northern
Eritrea.
There are indications of gold and basemetal mineralization in several parts of northern Eritrea. Old workings and prospects, of
Italian time are found in Seroa and Arruba inHarab Suit. There is a Cu-mineralization along
a belt that passes through Raba and Semait areas where old workings are found. Gossanousrocks running for hundreds of metres occur in
Halibet area farther north.
Recent exploration activities and the work ofartisanal miners in Zara and other areas to thenorth is indicating the presence of auriferous
quartz veins and stock works in many areas inthis part of the country.
In conclusion, it can be said that mineralizationin most part of the country is not well studied.
It may be far more complex and extensive thanis apparent. The level of technology and understanding of mineralization styles that prevailed
during the Italian occupation was low, andmost of the historic mines and old mining operations in Eritrea were interrupted because of
the Second World War. The investment climatethat existed at the time of the struggle for independence that followed was also not conducive to the development of these operations.
It is therefore, no doubt that this part of theregion has great potential to be well endowedwith mineral deposits.

For further information
contact:
Ministry of Energy and Mines
Department of Mines
P.O.Box 272
Asmara,EritreaTel: +291-1-202889+291-1-202843/44
Fax: +291-1-124509
www.moem.gov.er

To f i n d o t h e r U s e f u l i n f o r mation on Eritrea,
please check these sites:-www.shabait.com
www.dehai.org

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© 2009 Ministry of Energy and Mines