Gold, Copper and Zinc in Eritrea October 2017 Disclaimer This - - PowerPoint PPT Presentation
Gold, Copper and Zinc in Eritrea October 2017 Disclaimer This - - PowerPoint PPT Presentation
Gold, Copper and Zinc in Eritrea October 2017 Disclaimer This presentation (the Presentation ), which has been prepared by Andiamo Exploration Limited (the Company ), is confidential and is being provided to a limited number of
Disclaimer
This presentation (the “Presentation”), which has been prepared by Andiamo Exploration Limited (the “Company”), is confidential and is being provided to a limited number of recipients solely for their information and may not be copied, published, reproduced or redistributed in whole or in part to any person at any time, or used for any other ppurose, without the prior written consent of the Company. The Presentation has not been independently verified and the information contained in it is subject to updating, completion, revision, verification and further amendment. The Presentation does not purport to contain all information that a prospective investor may require. This Presentation does not constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer to subscribe for or purchase, any securities of the Company, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, or act as any inducement to enter into, any contract or commitment whatsoever with respect to any such securities. This Presentation has not been approved by an authorised person pursuant to section 21 of the Financial Services and Markets Act 2000 (“FSMA”) and accordingly, in the United Kingdom, it is issued and only made available to, and directed at (a) persons who are investment professionals falling within the scope of Article 19 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”); (b) high net worth entities and other persons to whom it may otherwise lawfully be communicated falling within the scope
- f Article 49 of the Order; and (c) any other person to whom this communication may otherwise lawfully be communicated or caused to be communicated (all
such persons in (a) to (c) together being referred to as “relevant persons”). Any investment or investment activity to which the Presentation relates is available
- nly to relevant persons or will be engaged in only with such persons, and persons who do not have professional experience in matters relating to investments,
and persons of any other description, should not rely or act upon it. The communication of this Presentation to any other person in the United Kingdom other than relevant persons is unauthorised and may contravene FSMA. The information in this Presentation was obtained from various sources. No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information and opinions (whether written or oral) contained in the
- Presentation. The information contained in this Presentation is for the recipient’s information regarding the Company and is for discussion purposes only.
Accordingly, neither the Company nor any of its shareholders, directors, officers, managers, agents, employees or advisors take any responsibility for, or will accept any liability, whether direct or indirect, express or implied, contractual, tortuous, statutory or otherwise, in respect of, the accuracy of completeness of the information herein or for any of the opinions contained herein or for any errors, omissions or misstatements or for any loss, howsoever arising, from the use of this Presentation. In furnishing this Presentation, the Company does not undertake or agree to any obligation to provide the recipient with access to any additional information or to update this Presentation or to correct any inaccuracies in, or omissions from, this Presentation. This Presentation should not be considered as the giving of investment advice by the Company or any of its shareholders, directors, officers, managers, agents, employees or advisors. In particular, any estimates or projections or opinions contained herein necessarily involve significant elements of subjective judgment, analysis and assumption and each recipient should satisfy itself in relation to such matters. No securities commission or other similar regulatory authority has reviewed or passed on the merits of this Presentation and any representation of the contrary is an offence. This Presentation is not, and under no circumstances is to be interpreted as, a prospectus (whether under section 87A of FSMA, or otherwise), public information, solicitation or advertisement for the sale or trade of securities, and has not been approved by or filed with the UK Financial Conduct Authority. Nothing in this disclaimer shall be effective to limit or exclude any liability which by law cannot be limited or excluded.
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➢ Private UK company based in London ➢ Developing VMS copper/gold/zinc and lode gold; in Eritrea ➢ Multiple VMS targets ready for drilling ➢ New VMS discovery at Hoba – 30m thick ➢ Expanding the Yacob Dewar gold project ➢ JORC compliant mineral resource of 940,000 t at 2.8 g/t for 85,000 oz Au ➢ Possibility of extensions along strike ➢ Potential low cost, near term gold production ➢ Haykota Exploration Licence expanded in 2016 ➢ Eritrea highly prospective for polymetallic VMS deposits (e.g The Bisha mine, Debarwa, Asheli)
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Andiamo Exploration Ltd
Mark Parker Non-Executive Chairman
Exploration geologist and executive. Previously Founder/Managing Director of African Eagle (AIM) nickel discovery in Tanzania, East Africa. Involved in exploration and development projects in Africa.
Dr Tim Williams CEO
Mining Geologist with a strong financial background. 30 yrs experience in mining with majors (de Beers, JCI, Gencor) and juniors (Golden Star, MDN). Mining finance background - James Capel, Lehman Brothers, EY. PhD in mining geology.
Dr Seife Berhe Country Manager, Eritrea
Geologist, expert in Eritrean geology and its mineral deposits, authoring on Eritrean crustal evolution. Specialist in remote sensing applications for identification of economic mineralization. Founder of Global Resources, an environmental consultancy in Eritrea. PhD in geology and remote sensing.
William Fisher PGeo Non-Executive Director
Executive with 30 years experience. Chairman of GoldQuest; Previously Chairman of Aurelian Resources (sold to Kinross for $1.2 billion); previously CEO of GlobeStar Mining; and VP Exploration of Boliden.
Anthony Balme Non-Executive Director
Chairman of Ortac Resources Ltd.
Johan Ingwersen Non-Executive Director
Representing NurtureEx (a division of African Minerals Exploration Development) funds. Highly experienced exploration geologist.
Andiamo – Directors
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Directors 20.5% NurtureEx 24.99% Ortac 17.4% >3% holders (2) 13.1% 1% to 3% holders (8) 12.6% Other holders 11.4%
➢ Private UK Company
- Holds the Haykota Exploration Licence in Eritrea - directly
- Branch office in Asmara, Eritrea
➢ Equity
- 57.6 million shares in issue
- Implied capitalisation $5.7M
- Largest shareholders:
– NurtureEx 25% held by Emerald B.V. – Ortac Resources 17.4%
- 120 shareholders
- Institutional, individuals and corporate
- Founders all personally invested in Andiamo
➢ Funds raised
- US$ 14M 2010-2017
Andiamo – Corporate Profile
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- E X P L O R A
T I O N L T D •
Asmara Projects Zara Mine Bisha Mine Andiamo
Exploration Licences and Mines in Eritrea 2017
Danakali Potash
- E X P L O R A
T I O N L T D •
➢ Eastern Belt contains Bisha, Harena, etc ➢ Western Belt contains new Ashelli discovery by Bisha Mining SC and Andiamo discoveries – Hoba, Yacob Dewar, Frataka, others ➢ Bisha Mining SC: Ashelli drilling:
- Nevsun Inc Press Release April
2016 44.0m @ 1.97% Cu, 9.13% Zn, 0.36g/t Au, 32g/t Ag
- Nevsun Inc Press Release June
2016 31.3m @ 1.30% Cu, 13.98% Zn, 0.70g/t Au, 41g/t Ag,
Ashelli discovery (Bisha Mining SC) Hoba VMS discovery (Andiamo)
Volcanogenic Massive Sulphides
VMS trends in SW Eritrea
Yacob Dewar VMS gold discovery (Andiamo)
Andiamo’s Systematic Exploration of the Haykota Licence
>30 targets located pre-2016 expansion of licence to south Coincident gravity high + e/m conductor = VMS target
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e/m conductors Gravity survey
Haykota Licence Increased in 2016
- A further 95km²
was added to the Haykota EL in 2016
- The area covers
the southern continuation of the Asheli/Hoba VMS belt
- Many e/m VMS
targets have already been generated
- Surface gossans
provide visual confirmation of many VMS targets
2016 Extension airborne e/m targets
- E X P L O R A
T I O N L T D •
VMS discovery at Hoba in 2015/16
➢ VMS lens ~30m thick with gold and copper mineralisation above sulphide stringer zone ➢ ~3000m drilling completed ➢ Intersection of 0.8% Cu over 28m ➢ 20km along strike from Ashelli VMS discovery (of Bisha Mining) ➢ Ashelli drilling highlights: ➢ Nevsun Inc Press Release April 2016 44.0m @ 1.97% Cu, 9.13% Zn, 0.36g/t Au, 32g/t Ag ➢ Nevsun Inc Press Release June 2016 31.3m @ 1.30% Cu, 13.98% Zn, 0.70g/t Au, 41g/t Ag
- E X P L O R A
T I O N L T D •
HOBA VMS discovery and geophysical modelling
Modelled conductor Modelled conductor Gossans Gossan
- E X P L O R A
T I O N L T D •
Gossans Modelled conductor Modelled conductor Gossan
Hoba Discoveries
Zone 4 Zone 4A
Hoba drilling road
- E X P L O R A
T I O N L T D •
Drilling Hole 3 on Mt Hoba in July 2015 – and (right) 61 mm diameter HQ core showing massive and “stringer” sulphides
Drilling at Hoba
➢ VMS gold-copper deposits along >3km strike ➢ Small high-grade surface gold deposit down to 40m ➢ Oxide copper potential ➢ JORC 2012 compliant mineral resource ➢ Nearby satellite deposits at Ber Gebay – 2017 drilling confirmed gossan geometry ➢ Social and Environmental studies well advanced ➢ Confirm size potential of the deposit then evaluate project economics ➢ Anticipate a low capital cost and low operating cost mine
Yacob Dewar Gold
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Yacob Dewar Gold
“Silica-Barite” horizon exposed in stream
“Silica-Barite” high
grade gold horizon 2014 trenches: > 1.2km along strike
Copper – oxide
Category tonnes Copper % Contained copper tonnes Indicated 1,400,000 0.37 5,200 Inferred 3,850,000 0.43 16,700
Yacob Dewar Mineral Resource Estimate (JORC)
Gold - oxide
Category tonnes Gold g/t Contained gold oz Indicated 880,000 2.82 80,000 Inferred 60,000 2.37 4,500
UK engineers, SRK, to deliver an independent NI 43-101 resource calculation for the Jacob Dewar gold and copper oxides in Q4, 2012
➢ Gold and Copper oxides substantially separate ➢ Good gold grades average +/- 3g/t ➢ Surface deposit – open pit ➢ No environmental problems identified ➢ Process water available ➢ Good infrastructure ➢ Low Capital Cost: High return
Yacob Dewar Oxide Gold and Copper
Massive sulphide 63 m @ 2.4% Copper (oxide)
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Ber Gebay gossan 2.4 km from Yacob Dewar
LODE GOLD
Shambotai – Jawkeray region
Extensive artisanal gold workings (both for alluvial and lode gold) Strong gold-in-soil geochemical anomaly Gold bearing quartz veins, drill intersected
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Shambotai gold
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➢ Strong gold anomaly
- Main zone 1.5kms x 0.5kms
- North zone 0.8kms x 0.5 kms
- Very extensive artisan activity
- Clear geophysics connection
- Drilling 36m @ 0.52 g/t Au
November 2011 Andiamo update
ykota license project area
Mew Extension to south
- f Haykota Licence:
Geology and e/m targets
Andiamo Corporate Strategy
➢ Exploration for VMS in the Haykota Licence
- Target is multi-million tonne massive sulphide Cu/Zn/Au surface deposits
- Strong geophysical and geochemical evidence: nearby discoveries
- Multiple drill ready targets. Drilling has already demonstrated mineralisation
- 91 km2 extension granted in August 2016 – multiple VMS targets
➢ Advance Yacob Dewar and Ber Gebay to a development decision
- Surface gold and copper deposits; open pit; high grade; simple processing
- Potential low capital cost, near term production
- Expand resource with further drilling
- Confirm size and economics then decide whether to develop or joint venture
➢ Exploration for shear hosted gold in Haykota Licence
- Target is multi-million ounce gold deposits at surface
- Extensive artisan mining activity: both valleys and veins
- Drilling has already demonstrated mineralisation
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Wax Chandlers Hall 6 Gresham Street London EC2V 7AD UK +44 20 7600 1888 3rd Floor, Saba Building Warsay Avenue Asmara Eritrea +291 118 4662
Eritrea
Highly prospective geology, only recently opened up to exploration
- Land area about 120,000km2 ; Red Sea coastline 1,200 kms
- Population; approximately 5 million (UN 2008), plus another 1 million dispersed globally
- Topography: sea level to a fertile plain at about 2,500m. Steep, rugged escarpment
- Climate: Semi Arid: main rains July-Sept, largely in storms
- Culture: nine ethic groups and languages
- Major Language: Tigtinya, Arabic: English widely used in business
- Major Religions: Islam, Christianity
- Government: People’s Front for Democracy and Justice, the successor to EPLF
- Economy: dominated by agriculture, plus minor industries. Mining will dominate in the future.
- Independent following UN supervised referendum held in 1993.
- GNP per capita: approximately US$800 pa
- Capital: Asmara, since 1900; population approximately 500,000
- Ports: Massawa, which supplies Asmara; Assab, traditionally the major port for Ethiopia
- Airports: Asmara, International; potentially Massawa International (not yet), Assab
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Young country actively encouraging its mining industry
➢ 1500s Ottoman Empire annexes Eritrea ➢ 1890 Italian Colony declared ➢ 1941 Allies defeat Italian forces: UK occupation ➢ 1952 UN declares federation of Eritrea and Ethiopia ➢ 1962 Ethiopia annexes Eritrea: independence struggle starts ➢ 1988 Battle of Afabet, turning point victory by Eritrean liberation forces ➢ 1990 Port of Massawa recaptured by EPLF ➢ 1991 EPLF recaptures Asmara, forms provisional government ➢ 1993 UN sponsored referendum; Eritrea becomes independent and joins United Nations ➢ 1998 Outbreak of major hostilities between Ethiopia and Eritrea ➢ 2000 Algiers agreement between Eritrea and Ethiopia to establish border commission ➢ 2003 UN Boundary Commission issues ruling: accepted by Eritrea, not by Ethiopia ➢ 2009 Bisha mine fully financed by international institutions and banks ➢ 2011 Bisha mine starts commercial production: 2011 379,000 oz Au; 2012 313,000 oz Au. ➢ 2012 Zara gold mine sold to China SFECO and ENAMCO for $114m. ➢ 2016 Asmara gold and VMS projects sold to Chinese investor and ENAMCO
Eritrea History
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Eritrea Mining Law
Minerals Proclamations (Law) enacted in 1995
- Eritrean Mineral Proclamation 1995 and associated tax proclamations
- Based on law of Australian Northern Territories
- Written in Tigrinya and English
- Allows for:
– Prospecting Licence
- Valid for one year, not renewable, gives exclusive right to apply for Exploration Licence
– Exploration Licence
- Valid for 3 years
- Renewable twice for one year with reduction in area
- In practice, ELs have been renewed on an annual basis if adequate work has been done
– Mining Licence
- Valid for 20 years, renewable
- Taxation
– Royalty (NSR) of 5% on gold and 3.5% on base metals – Corporate income tax rate of 38% – 100% Capital allowances, carried forwards – Nominal import taxes (0.5%) on qualifying imports – Employees pay Eritrean income tax, expatriates pay 10% withholding tax – State (ENAMCO) equity free carry 10% – State additional 30% participating equity interest purchased at agreed price
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