Ethiopia

Established 1835

A supplement to Mining Journal

Allana Potash Altau Gold EMDSC MIDROC Gold Nyota Minerals Stratex

ETHIOPIA Ethiopia facts

Capital: Addis Ababa Area: 1.2 million km2 Population: 73 million GDP: US$77.36bn Ethnic groups: Amhara and Oromo are the dominant ethinc groups. English is widely spoken

Proud independence
Typical scenery of northern Tigray region, Ethiopia Mesozoic sediments in foreground, Arabian-Nubian Shield basement rocks in centre and Tertiary volcanic intrusions in background Photo: Stratex

CONTENTS
Introduction / Mining / Geology Gold and base metals in the north Gold output growing Mining legislation Platinum mineralisation Profiles: Allana Potash EMDSC MIDROC Gold Nyota Minerals Stratex 2-4 5 9 11 14 6 8 10 12 15

Supplement editor: Chris Hinde Design and production: Tim Peters Geology and mining sections by: Gebre Egziabher Mekonen, Head of the Mineral Licensing and Administration Department, Ministry of Mines, Ethiopia Printed by Stephens & George, Merthyr Tydfil, UK Aspermont UK 2011 An Aspermont company Published in January 2011 by: Aspermont UK, Albert House, 1 Singer Street London EC2A 4BQ Tel: +44 (0)20 7216 6060 Fax: +44 (0)20 7216 6050 E-mail: editorial@mining-journal.com Website: www.mining-journal.com

THIOPIA is not only Africas oldest independent country, it is one of the oldest in the world. The territory can be traced back to the Aksumite Kingdom of the first few centuries before Christ, and, apart from a five-year occupation by Mussolinis Italy, Ethiopia has never been colonised. The economy revolves around agriculture (the country is one of Africas leading coffee producers), which in turn relies on rainfall. The country lies in the Horn of Africa, bordered to the north and northeast by Eritrea, to the east by Djibouti and Somalia, to the south by Kenya, and to the west and southwest by Sudan. Ethiopia has a high central plateau that varies from 1,290-3,000m; the highest mountain reaches 4,533m. The Great Rift Valley splits the plateau diagonally, with a number of rivers crossing the plateau (notably the Blue Nile, which rises from Lake Tana). Between the valley of the Upper Nile and Ethiopias border with Eritrea is a region of elevated plateaus from which rise the various tablelands and mountains that constitute the Ethiopian Highlands. East of the highlands towards the Red Sea is a strip of lowland semi-desert, the Ethiopian xeric grasslands and shrublands. Of the total land area, only about a fifth is under cultivation, although the amount of potentially arable land is larger. Only 10-15% of the land is presently covered by forest as a result of rapid deforestation over the past 30 years. Of the remainder, a large portion is put to pasture.

MINING
Among various minerals such as metallic, industrial, construction and gemstones, occurrences and deposits have been discovered in different parts of Ethiopia. Only very few are developed and being mined at present. The history of gold mining in Ethiopia dates back to biblical times. A substantial number of placer gold deposits were discovered and mined by semi-mechanised and artisnal methods in the Adola, southern greenstone belt. Artisanal miners are also exploiting a number of placer gold occurrences in different parts of the country. The gold being mined by artisanal miners nationwide is estimated at more than 3.5t/y. A placer gold deposit that could be mined by mechanised mining was recently delineated and licensed to a private company within the southern, western and northern greenstone belts. A large-scale primary gold mine has so far been found at Lege Dembi. Opened in the late 1980s, it was privatised in early 1998. Average production from the open pit is 3.6t/y of gold and development works are under way to develop the underground resource. Placer Platinum has been mined since 1926 at Yubdo in the western greenstone belt. Although the deposit has still contained 12t of platinum, the mine closed for a long time due to a recovery issue. A state-owned enterprise is operating on an open-pit columbotantalite mine at Kenticha in the Adola belt. The deposit is both a weathered crust ore (the top 60m) with proven reserve of 2,400t of tantalum pentaoxide and 2,300t of niobium pentaoxide, and primary ore with proved reserve of 2,393t Ta2O5 and 2,363t Nb2O5. The mine has been operating since 1990 with a pilot plant producing about 20t/y. Its current output rate of tantalite concentrate is over 210t/y, as of mid-2010. Soda ash is being mined at Lake Abiyata in the rift valley about 200km south of the capital. The reserve at Lake Abiyata and the surrounding lakes exceeds 460Mt of sodium carbonate at salt concentration ranging from 1.1 to 1.9%. The plant is producing about 5,000t/y of soda ash at semi-industrial scale. The consumers of the soda ash are local caustic soda factories, as well as soap and detergent manufacturers.
January 2011

Message from the Minister of Mines

Dear Investors, The demand for metallic and industrial minerals, among other mineral commodities, is increasing at an attractive price. The chance of discovering a world-class deposit, on the other hand, is also challenging. However, the mineral potential of Ethiopia has not yet been fully explored. Ethiopia is endowed with various types of metallic minerals such as gold, platinum, copper, lead, zinc, tantalite-colombite, manganese, molybdenum and potash. This mineral potential, coupled with the attractive and conducive investment environment, definitely magnifies the possibility of discovering economic deposits at a high rate of success. Furthermore, the Ministry of Mines of the Federal Democratic Republic of Ethiopia has established competitive legal and fiscal packages and a clear strategy to maximise the development of mineral resources in the country within the context of the free-market economic policy and the five-year (2011-16) National Growth and Transformation Plan (GTP). The mining sector envisages generating more than 10 times the current amount of foreign currency contribution, with this industry as the backbone of Ethiopias industrialisation in the next GTP. To this end, the ministry has developed and started implementing efficient and transparent service delivery. Therefore, we are pleased to welcome and encourage all potential investors to participate in the mineral-sector development of the country, where the metallic and industrial mineral resource is untapped. Sincerely yours, Sinknesh Ejigu

Mining Journal special publication Ethiopia

ETHIOPIA Varied climate

The climate of Ethiopia and its dependent territories varies greatly, with the climate being temperate on the plateau and hot in the lowlands. At Addis Ababa, ranging from 2,200-2,600m, the maximum temperature is 26C and a minimum 4C. The weather is usually sunny and dry, but the short (belg) rains occur from February to April, and the big (meher) rains from mid-June to mid-September. The Somali Region and the Danakil lowlands in the Afar Region have a hot, dry climate producing semi-desert conditions. The country lies wholly within the tropics, but its nearness to the equator is counterbalanced by the elevation of the land. In the deep valleys of the Tekez and Abay, and generally in places below 1,200m, the conditions are tropical and diseases such as malaria are prevalent. On the uplands, however, the air is cool and bracing in summer, and in winter very bleak. President: Girma Woldegiorgis (above left) (since October 2001) Prime minister: Meles Zenawi (above right) (since August 1995) Under the constitution of December 1994, a Council of Ministers is selected by the prime minister, and approved by the House of Peoples Representatives. The President is elected by the House of Peoples Representatives for a six-year term (and is eligible for a second term). This election was last held in October 2007. The Prime Minister is designated by the party in power following legislative elections.

Political system

Agriculture is the countrys largest industry for inward investment, while flowers and coffee are key exports

Photos: Bloomberg News

Despite a number of occurrences in the country there were no legalised gemstones mines until recently. In the past few years a number of local and foreign companies have gained licenses to explore for opal in the central and peridote (olivine) in the southern region. Lake Traditionally, salt has been mined in Ethiopia Tana for a long time. Ethiopia possesses huge salt Detailed geological reserves, both a rock salt of the evaporite map of Ethiopia sequence in the Dallol salt plain and in the brine lakes of the Afar Depression. Apart from the production of salt by locals, a large number of investors are licensed to Addis Ababa produce salt from Lake Afdera. Local and foreign companies are also licensed to produce dimension stone. The dimension stones being mined in different parts of the country include marble, granite, amphibolite, limestone, sandstone, gneiss and volcanic rocks (ignimbrite, rayolite, etc). Kaolin, quartz and feldspar are also being mined from the Adola belt in southern Ethiopia by government enterprise. The consumers of the products are the Awash-Melkasa Aluminium Sulphate and Sulfuric Acid Factory and the Tabor Ceramics Factory. Local industry is also mining Paleozoic Rocks Cenozoic Rocks High-grade Precambrian Precambrian and utilising silica sand. The Phanerozoic Intrusives Early-Mid Tertiary basalt Sandstone and tillites Undifferentiated gneisses and schists Gabbro nations factories are using Upper Tertiary-Quaternary Low-grade Precambrian basalt Mesozoic Rocks Diorite high-quality limestone, clay, Mid Tertiary-Quaternary Metavolcano-sediments Undifferentiated sediments felsic rocks Granite-tonalite gypsum and pumice as a raw Metaultramafic-mafics Early Tertiary sediment material for cement production. Minerals such as sand, gravel, Precambrian rocks and related intrusions metamorphism (amphibolites to granulite metamorscoria, crushed stones, aggregates, pumice and scoria These rocks are found in four major regions of phism). also play a significant part for the construction Ethiopia: west and south-western; North; South; and Thick successions of the low-grade metavolcanoindustry on buildings, roads, dams and bridges. Eastern regions of the country. sedimentary assemblages including the island arc and The Precambrian metamorphic rocks comprise dismembered ophiolites assemblages are commonly GEOLOGY litho-tectonic low-grade volcano-sedimentary termed as Upper complex of the Precambrian Ethiopia is underlain by geological formations that assemblages (of mica, feldsphatic, amphibolites, basement. range from Precambrian to recent. About a quarter chlorite, etc) with associated mafic to felsic intrusives Linear belts of mafic and ultramafic rocks are of the countrys landmass is occupied by Precambrian (such as granites, granodiorites, diorites, basic dykes, commonly confined to major shear zones often metamorphic rocks, a quarter by Mesozoic gabbro and the like) and high-grade orthogneises and marking the contact between the two assemblages. sedimentary rocks and half by Cenozoic volcanics and paragneises assemblages. These crystalline basement Gneissic terrains (Lower Complex) are generally sediments. rocks have undergone poly-phase deformations and considered to be older than the volcano sedimentary
Geology: Modified from Mengesha et al.(1996) Geological map of Ethiopia, second edition, 1:2,000,000

January 2011

Mining Journal special publication Ethiopia

ETHIOPIA Mining law has spurred foreign private investment

Historically, few companies have carried out systematic exploration in Ethiopia for the last four to five decades. According to different studies, most of which are UNDP-funded, and some others by joint study projects, reported that gold, tantalum, soda ash, potash, nickel and platinum minerals have the most potential for development of the mineral sector. In the past 20-30 years, companies including Ashanti, Canyon Resources, Emerging Africa Gold, Golden Star, JCI, Rift Resources and Tan Range have explored some areas of the known gold occurrences. In the past few years, local and international companies have undertaken early and advanced explorations. Some of these include: MIDROC Gold mine: exploration and development (E&D) of new industrial-scale mega-shear zone-hosted and skarn-type gold and associated metals deposit in the metekel (western) greenstone area; Nyota Minerals (Ethiopia): focused on E&D of syanite-hosted primary gold project at Tulu Kapi and other primary gold occurrences exploration in Wollega, Western Ethiopia, as well as other exploration companies for precious- and base-metal minerals. Others include: A base-metals site in the northern region assemblages. The Precambrian rocks of Ethiopia lie at the unique position of the northern part of the Mozambique belt and southern tip of the Arebonubian shield. Palaeozoic- Mesozoic sediments Paleozoic is poorly represented with the exception of well-documented permo-Triassic Karoo sedimentary rocks at the base of Ogaden basin and the presumed Ordovician glacial deposits in northern Ethiopia. Thick Mesozoic sedimentary sequence is extensively exposed in eastern part of the country extending as far as central and northern Ethiopia beneath the tertiary volcanic and overlain un-conformably on the basement rocks. Two major transgression-regression cycles took place during the Mesozoic era. The sedimentary sequence represents the Jurassic transgression of the Indian Ocean from the east (in the Ogaden) towards north and west and then subsequent regression to the sea. The Mesozoic rocks composed of the major stratigraphic sediments of Triassic sandstone (Lower or Adigrat sandstone), Jurassic Limestone of Antalo group and the Cretaceous (upper) sandstone with intercalations of mudstone and marl. Cenozic volcanic and sediments The Tertiary to Quaternary geology of Ethiopia is related to the evolution of the East African rifting. Highland Ethiopia is underlain by Tertiary volcanics, mainly basalts. Tertiary as well as Quaternary volcanics and sediments characterize the rift valley. Tertiary sediments are known in the Ogaden, Danakil Depression and in the lower Omo River Valley. Quaternary sediments occur throughout the country. As a result of epierogenic uplifting of the Afro Arabian (East Africa) basement (and their transgressive sediments) due to mantle plume, enormous quantities of basaltic magma (late Mesozoic) generated in the lithosphere, came through crustal fissure and brought formations of continental flood basalt province, known as Trap series of Ethiopia. The flood basalt volcanism culminated by the formation of alkaline basaltic shield volcanoes some of which rise above 4,000m above sea level on both the western and south-eastern plateaus of Ethiopia.

ASCOM Mining plc: gold and base-metals

exploration in the western greenstone belt;

Stratex International: exploring for epithermal

gold deposit system in the north-eastern rift volcanics and has found bonanza-type gold-bearing alteration zones and plans to test by drilling for its continuity in the current quarter; Aberdeen International Inc: exploring for primary gold in the western greenstone belt and also gold and base metals in the northern greenstone belt; Sheba Exploration Plc a British registered company operating in the northern greenstone belts of Ethiopia and others. Local company Ezana Mining Development plc, in joint venture with Chinas Donia Beijing, is conducting base-metals resource estimation in western Tigray as well as further exploration of gold and base metals in a number of target areas within northern greenstone belt; Other junior international and local companies are carrying out aggressive exploration works. MIDROC owns and operates the

Legadembi gold mine, producing about 4t/y of gold dor at present. It is also actively involved in exploration projects near the known Legadembi mine and developing the underground lode-type gold deposits at Sakaro locality in the goldfield of southern greenstone belt, about 500km south of Addis Ababa. Ethiopian Minerals Development Share Co is also producing tantalum-niobium concentrates at Kenticha pegmatite-bearing mafic-ultramafic belt and exporting 210t/y, representing over 9% of global tantalum-niobium ore supply. Some local and Chinese companies are also exploring near the known tantalum-niobium deposit in the Kenticha greenstone belt. As for industrial minerals, especially potash and related evaporite minerals, Canadas Allana Resources, G and B Central African Resources Ltd (a BVI firm) and Indias Saink Potash are focused on the E&D of a previously explored Dallol potash property in the Danakil Depression of the Afar National Regional State, in the north-east. The Denakil depression is the worlds lowest point: 120m below sea level. BHP Billiton has also been prospecting the possibility of potash and related minerals potential areas in the same Denakil depression sedimentary successions for the last few years. The stimulus for this E&D work is the result of the mining legislation that had been initially promulgated in 1993, and the overall positive investment climate in Ethiopia. Following this, in July 2010, the Ethiopian government enacted a revised mining law, A Proclamation to Promote Sustainable Development of Mineral Resources, to make the minerals sector more favourable for foreign direct investment, and to be transparent and equitable in using the mineral resources of the country. The requirements for licensing and the time frame for awarding a licence right are also relatively simple and quick depending on the number of applications that need processing in one given time provided that the applicant fulfils the minimum requirements as stipulated in the mining legislation, which is similar to best practices of the well-known mining industry countries. Potash exploration on the Denakil salt plain

This article has been prepared by Gebre Egziabher Mekonen Wube, Head, Mineral Licensing and Administration Department, Ministry of Mines (e-mail:gebremw@yahoo.com)

Acid pools within salt accumulations at Dallol hot springs, Afar region, north-eastern Ethiopia
January 2011

Mining Journal special publication Ethiopia

ETHIOPIA

Gold and base metals in the northern greenstone belt

Gossan ore (Terer deposit)

The mining scene in Tigray

INERAL resource development is playing a key role in the development of the Ethiopian economy. In the past six years, the average growth in Ethiopian GDP has investment after agriculture. There is great potential for discovering base metals (associated with gold and silver) in northern Ethiopia, according to Beijing Donia Resources Co, and its local partner, Ezana Mining plc. The Nubian Shield was divided into five tectonic terranes in northern Tigray (from west to east: the blocks of Shgraro, Adi Hageray, Adi Nebried, Chila and Adwa). They are characterised by distinct cycles of magmatic activities separated by ophiolite belts analogous to the situation in Arabia. VMS mineralisation and orebodies were recently found in the Adi Nebried Block, where the metallogenic tectonic settings is very similar to those of Debarwa Cu-Zn deposits in Asmara VMS-type metallogenic zones, and is the SW extension part of the Asmara zone.

exceeded 10%. To maintain this development trend, the government requires further exploration and development of the countrys resources. This Horn of Africa nation, which contains deposits of gold, silver, copper, platinum, potash and tantalum, exported US$281 million of gold in the fiscal year to July 7, 2010 (according to Gebre Egziabher Mekonen, head of Mineral Operations Department at the Ministry of Mines). Two companies are at the centre of these efforts: Ethiopian-born Saudi billionaire Sheikh Mohammed al-Amoudis MIDROC Gold Mine plc; and Perthbased Nyota Minerals Ltd. Both companies plan large-scale operations, and investment in the countrys mining industry has surged from less than US$100 million in 2003 to an accumulated US$1.3 billion in 2010. Mining has become the second-largest industry for inward

METALLOGENETIC SETTING
Regionally, the northern Ethiopia area is part of Neo-Proterozoic (0.85-0.50Ga) Arabian- Nubian Shield, being composed of granitoid-greenstone belt terranes and mid-crustal gneissic terranes. These lie on either side of Red Sea, and also underlie parts of Egypt, Sudan, Eritrea, Saudi Arabia, Yemen and Jordan. The terranes represents the northern sector of the East African Orogen, with super-crustal and mid-crustal rocks of similar age extending to southern Madagascar. The green schists represent normal volcanic sedimentary sequences in the northern Ethiopia. Currently, there are at least 60 VMS-type deposits presents in the Arabian-Nubian shield, excluding the newly discovered volcanogenic massive sulphide (VMS) deposits in northern Ethiopia.

EXPLORATION HISTORY
In 1970 and 1972, exploration activities (regional mineral prospecting works including soil sampling and rock sampling with detailed geological and geochemical surveys) in northern Ethiopia were carried out by the Ministry of Mines. Further exploration works did not take place from 1974 to 1993 due to the civil war. Work during 1994-95 included regional and follow-up geological and geochemical surveys in most areas, and detailed exploration that included geological mapping, trenching and geophysical survey in selected areas.

Tigray Region
Tigray Region is the northernmost of Ethiopias nine ethnic regions (kililoch). Its capital is Mekele. Tigray is bordered by Eritrea to the north (independent from Ethiopia since 1993), Sudan to the west, the Afar Region to the east, and the Amhara Region to the south.

The Tigra region seems likely to become the centre of the countrys base and preciousmetals exploration effort in the future

Gold and Copper targets in Ethiopia www.altaugold.com

January 2011 Mining Journal special publication Ethiopia

PROFILE

Allana: developing a world-class potash project

Aerial view of the Allana camp showing berm and buildings

LLANA Potrash controls potash concessions covering 161km2 in the Danakil Depression. The property has an inferred mineral resource of 105.2Mt, with a composite grade of 20.8% KCl. The unique environment suggests low capital and operating expenditure may be achievable using solution mining, solar evaporation and geothermal energy. Allana has executed an MoU securing a strategic partner from China to contribute 35% of the mine capex (estimated at US$285 million) in return for an off-take agreement. In 2010, Allana advanced the project through exploration drilling and geophysical studies, and recent drilling in the centre of the evaporite basin indicates strong potential to increase the potash resource substantially, and to elevate Drilling on confidence in the resource the salt to Indicated status. plain, Hole DK-10-04

Signicant drill results, Dallol Potash Project

Hole DK-10-01 including DK-10-02 including DK-10-03 including DK-10-04 including including DK-10-06 including including DK-10-07 including
*drilled width

From (m) 110.80 114.15 150.10 150.10 151.25 152.35 744.00 746.40 746.40 495.30 567.30 567.30 580.80 136.00 142.00 214.10

To (m) Width (m)* KCI (%) 117.30 6.50 17.65 116.15 2.00 19,94 155.65 5.50 25.80 152.10 2.00 34.80 161.20 9.95 19.52 154.35 2.00 28.90 776.40 32.40 8 00 760.00 13.60 10.50 748.10 1.70 17.90 498.30 3.00 30.87 585.00 17.70 17.25 576.60 9.30 17.45 585.00 4.20 24.51 145.20 9.20 23.42 144.00 2.00 37.75 220.80 6.70 22.04 8,000m is planned on the newly acquired Haro concession and in the centre of the evaporite basin, where historic exploration has been limited. Significant drill results are presented in the table and on the map above. Late last year, Allana mobilsed a water drill to begin delineating sources of fresh water for future operations. An initial review of the seismic data has identified numerous reflectors some of which may represent the potash horizon. This data will provide insight as to the extent continuity of the potash horizon throughout the evaporite basin and assist in the location of additional drill holes.

HIGHLIGHTS:

161km concession in the

Danakil Depression covering an extensive evaporite basin. Proven potash-bearing horizons drilled by Ralph M Parsons company in the 1950-60s, resulting in 171.3Mt grading 32.48% KCl on adjacent property, including only upper Sylvinite Member. Allana property: inferred sylvinite resource of 31.3Mt grading 25.4% sylvite; inferred kainitite resource of 73.9Mt grading 61.7% kainite; combined inferred mineral resource 105.2Mt at composite grade of 20.8% KCl on 10% of the property. Low capex because of shallow depth (50-100 m) to potash, amenable to solution mining. Low operating cost environment because conducive to solar evaporation. Strategically located: 100km from Red Sea and easy access to the emerging markets of India and China. Over 5,000m of drilling has intersected robust grades, confirming the historic resource, and exploration drilling in virgin parts of the basin has identified thick sequences of potash. Recent positive drill results indicate strong potential to boost the potash resource.

Allanas project has been previously explored. The US-based Ralph M Parsons company drilled nearly 300 drill holes from 1958-1967 and even sank a shaft to conduct underground mining. Allana has completed a NI 43-101-compliant technical report for the three main concessions highlighting several unique advantages of this project: An inferred mineral resource of 105.2Mt of potash mineralisation (Sylvite and Kainite) with a composite grade of 20.8% KCl; Near-surface (shallow-depth) potash mineralisation (within 50m of surface); Potential for solution or open-pit potash mining; Some 16 drill-holes immediately on Allanas property but 90% of the project is unexplored; Unique environment that may provide for low-cost production utilising solar evaporation and geothermal power; MOP (muriate of potash) and SOP (sulphate of potash) production are feasible. Potash occurs primarily as both sylvite (KCl) and as kainite (KMg(SO4)Cl*2.75H2O). Based on the Parsons work, the Sylvinite Member, or horizon, varies in width up to 11m (average of some 3m) and grades up to 35% KCl. The Kainitite Member is up to 13m (average 6m) and averages 62% kainite.

PATH FORWARD
Allana is continuing to drill on its potash property and aims to have revised resource estimate by the end of the first quarter of 2011. At this point, a bankable feasibility study will be launched, which the company believes will be completed by the end of March 2012. Allana is compiling proposals for this work from leading potash technical firms and hopes to award the BFS at the end of March this year.

CONTACTS
Allana Potash Corp 65 Queen Street West, Toronto, Ontario, Canada Tel: +1 416 309 2691 Fax: +1 416 861 8165 Website: www.allanapotash.com Contact: Farhad Abasov, President and CEO E-mail: fabasov@allanapotash.com

PROPERTIES
Dallol Potash Project Allana Resources has the rights to acquire four potash concessions in Ethiopias north-eastern Danakil Depression, totaling 161km2. The Dallol Potash Project area lies about 100km from the Red Sea coast. The potash mineralisation in the Danakil Depression is well known, with small-scale potash mining carried out intermittently from the early 1900s.

2010 EXPLORATION PROGRAMME

Allana embarked on a comprehensive exploration programme in 2010 and has constructed a modular camp, completed approximately 5,000m of diamond drilling and 45km of 2D seismic surveys. Positive results from the drilling indicate strong potential to increase the resource on the property. Drilling will continue into 2011 and an additional

Mining Journal special publication Ethiopia

January 2011

ETHIOPIA
Far left: the location of VMS deposits in the ArabianNubian Shield (Barrie, 2007) 53-56: Bisha Deposit Group; 57: Adi Nefas, 58: Emba Derho, 59: Debarwa, 60: Adi Rassi Left: regional tectonic block distribution map for northern Ethiopia

This was conducted by the Geological Survey of Ethiopia. Ezana Mining plc (a local exploration company) subsequently conducted intensive exploration. This included stream sediment, soil and rock chip sampling from regional to detailed-scale work in Terer, Mai Hanse and other areas in 1996-1998. Most exploration work was suspended from 1999 until 2001 during the border conflict with Eritrea. In 2001, Ezana started reverse-circulation (RC) drilling at Terer, based on encouraging prospecting results. The RC drilling operation intersected VMS and disseminated sulphide mineralisation that produced geochemical and geophysical anomalies within the felsic meta-volcanic rocks. In 2004, an airborne electromagnetic geophysical survey (at a scale of 1:50,000) was conducted in the 341km2 area, and outlined several magnetic anomalies. However, further exploration not done for VMS Cu-Zn-Au-Ag orebodies. Since March 2007, Beijing Donia Resources has established three JV companies with Ezana for conducting exploration in northern Ethiopia. This has included extensive exploration activities (incorporating high-resolution QB image purchasing and interpretation), different scales of geological mapping,

confirmed that the primary VMS zone is 800m along strike length, with an average thickness of 12m and the dip extends to 150m. Further drilling has been planned after the ground gravity and TM surveys are completed to enlarge the base and precious metals resources in Terakimti area. Adi Bladie Cu deposit Located 25km northwest of Shire in northern Tigray, this is the SW extension of the Terakimti VMS mineralisation. The test diamond drilling has confirmed that the VMS copper orebody is more than 300m long along strike, with an average thickness of 8m and 1.8% Cu grade. The on-going exploration is to enlarge the metal resource of Adi Bladie deposit.

Primary sulphide ore (Mai Argab section, Terer deposit) stream sediment sampling and irregular soil sampling, geophysical surveys of ground magnetic, IP and TEM, and trenching and test diamond drilling. Three VMS type Cu-Zn-AuAg deposits were discovered in the northern Ethiopia region.

Mining has become the second-largest industry for inward investment after agriculture

METALS POTENTIAL
In addition to the three VMS deposits above, there are other VMS mineralisation zones in this region. These include Nefasit and Hamlo, and there is a structurecontrolled gold mineralisation in the Mai Hanse area. Extensive geochemical anomalies and geophysical IP and TEM anomaly have been outlined in northern Tigray, and are worthy of more exploration. Indeed, it has been predicted that the total base-metal resource in northern Ethiopia will be more than 2Mt, and that gold resource will be over 50t. This region seems likely to become the centre of the countrys base and precious-metals exploration effort in the future, and will eventually meet the development needs of Ethiopia.

VMS DISCOVERIES

At least three VMS-type Cu-Zn-Au-Ag deposits have been discovered in the northern Ethiopia area. This indicates, according to Beijing Donia, much potential for base and precious metals resources in this region. Terer Cu-Zn-Au-Ag deposit Located 57km northeast of Shire in northern Tigray (near the border between Ethiopia and Eritrea), the deposit consists of two VMS orebodies: Adi Ekele and Mai Argab. A pre-feasibility study is ongoin but the estimated total resource of equivalent copper (Cu+Zn+Au+Ag) is about 100,000t. Terakimti Cu-Zn-Au-Ag deposit Located 29km northeast of Shire in northern Tigray, on the western side of the Terer deposit, the Terakimti VMS mineralisation is parallel to the Terer zone. The surface trenching has indicated there is about 3t of gossan gold, and test drilling has

Primary sulphide ore (Terakimti deposit)

Article based on paper by Sicai Zhu of Beijing Donia Resources Co

January 2011

Mining Journal special publication Ethiopia

PROFILE

EMDSCs mission control

Leading the economic construction in Ethiopia by intensive E&D of mineral resources

HE government-owned Ethiopian Mineral Development Share Company explores for mineral deposits and mines tantalum and industrial minerals. It was established when its predecessor, Ethiopian Mineral Resources Development Corp (EMRDC), was dissolved and restructured into four enterprises in August 1995. Ethiopian Mineral Development Enterprises was one of the four enterprises set up at that time. It subsequently changed into a public company. EMDSC is accountable to a Board of Directors appointed by the Privatisation and Public Enterprise Supervising Agency. Apart from oil and gas, EMDSC is engaged in mineral exploration, evaluation and development. The company also offers core drilling, laboratory analysis, surface and subsurface geophysical exploration, topographic surveying for other companies in the sector. EMDSC also acts as a consultant. EMDSCs main structure comprises: Three core units: Kenticha Mineral Production Process, Mineral Exploration and Evaluation process and mineral sales; Three support units: organised in the Addis Ababa HQ, and Kenticha and Bombawoha mining sites; Two service units. The company employs more than 560 at its sites, as well as in finance, property administration and human-resource development. EMDSC produces a good-quality tantalum concentrate, supplied for export. It is one of the worlds top five producers of columbotantalite concentrate. The mine is in the Kenticha area,

Simplified geological map of Kenticha pegmatite deposit One exploration team has discovered additional rare metal-bearing pegmatite deposits in northern and southern part of Kenticha tantalum deposits areas. In the Arero and Wachile areas (300km west of Kenticha pegmatite deposit), another team has outlined occurrences of granite-hosted vein and disseminated-type copper, gold and silver associated mineralisation. Subsurface drilling is in progress.

The Kenticha tantalite mine and processing plant southern Ethiopia, 550km south of Addis Ababa. The current mining plant can process 100t/hr of ore and can produce 200t/y of tantalite concentrate. The Ta2O5 and Nb2O5 content in the concentrate ranges from 45-60% and 10-20%, respectively. The tantalite concentrate EMDSC produces sometimes contains a substantial amount of uranium and thorium compounds that level it into a class-seven materials (total uranium and thorium compounds greater than 0.5-0.9%). EMDSC wants to add value on the concentrate products and needs the technology to improve the acceptance of the material in the global market (see Request for expression of interest). EMDSC says it is producing excellent-quality kaolin, dolomite, quartz, and feldspar and supplying these raw materials to local industries. Their uses include soap, paints, ceramics, pesticides and glass.

SERVICES
EMDSC owns core-drilling machines, geophysical and surveying equipments and fully furnished laboratories. The core-drilling equipment can drill up to 600m deep and has the facility for full-hole stabilised core barrels, wedging accessory to redirect boreholes, water supply tankers and pumps. The geophysical study team provides services for clients carrying out mineral exploration works locally. The geophysical system includes ground surveying (magnetic, radiometric, resistivity and IP surveying), borehole geophysical logging (with six different parameters) and a borehole inclinometer (measuring depth, angle and azimuth). Its laboratory facility includes atomic absorption spectrometry, fire assay, and x-ray fluorescence (XRF) systems.

MINERAL EXPLORATION
EMDSC is involved in prospecting and exploration for precious metals (gold and platinum), rare metals (Ta, Nb, Be Li, Sn, etc), industrial minerals (kaolin, quartz, feldspar, diatomite, bentonite, dolomite, limestone), decorative stones (granite, marble) and gemstones (among which precious opal, aquamarine, emerald, peridot, amethyst, red garnet are important). The exploration departments two main aims are: To discover additional reserves in areas around the existing mining operation so as extend the mine-life; To look for economic mineral deposits elsewhere, especially where mineral occurrences were previously reported.

FUTURE PROSPECTS
EMDSC plans to increase tantalum output through successive expansion projects into large-scale production. It has also strengthened its marketing and promotion activities to maximise sales revenue of industrial minerals. EMDSC is also looking forward to work in a joint-venture investment with other companies in exploration, mineral development and mining, and producing value-added materials from tantalite concentrate.

One of EMDSCs dolomite mining sites

Request for expression of interest

EMDSC needs to set up a metallurgical process plant as an integral part of its Kenticha tantalite-columbite concentrate production factory, 550km south of Addis Ababa. The rated design capacity of the new metallurgical plant will be 300-350t/y tantalite-columbite concentrate. The value-added commodities required as an output will be: K2TaF7, K2NbF7, K Salt, Ta2O5 and Nb2O5 powder, Interested applicants should submit their application with non-returnable CVs and copies with adequate purity. of credentials to our company (see address, EMDSC would like to hire an experienced professional right) to participate in this job within 30 days firm that can design the process flow sheet, estimate after the announcement date of this notice. capital and operational cost, specify the raw materials and We will send to them the terms of reference consumables, and supervise the construction of the (TOR) and instruction to bidders immediately. process plant, etc.

CONTACTS
Ethiopian Mineral Development Share Company (EMDSC) Bole Sub City (Kefle ketema, Kebele 05), Near St Gabriel Hospital PO Box 2543, Addis Ababa, Ethiopia Tel: +251 (0)116632226 or 2290 / (0)116187478 Fax: +251 116187143 / 116632291 E-mail: eemindut@ethionet.et or zerhabt@ethionet.et

Mining Journal special publication Ethiopia

January 2011

ETHIOPIA

Gold output grows

Stratexs activity
Stratex International plc is an exploration and development company focussing on gold and high-value base metals in Turkey, Ethiopia and Djibouti. Grass-roots exploration in Ethiopia has uncovered an extensive new gold district, which has attracted Thani Ashanti (an AngloGold Ashanti joint-venture company), which is currently funding exploration of the first 11 licence areas. Drill-testing of the first target, Megenta, is to commence during the current quarter. Last November, Stratex signed a deal with privately-owned LozBez Mining Private Ltd for the AbiAdi-Gichke gold project in Tigray province. This licence covers an area of 967km2 of highly prospective ground for gold and base metal mineralisation within the Arabian-Nubian Shield. Stratex is currently undertaking a due diligence study on AbiAdi (over a three-month period) for an initial expenditure of US$50,000. The company can then earn 75% of AbiAdi through the expenditure of US$1 million over a 36-month period, with an option to earn a further 10% of a joint venture company with LozBez. Stratexs interest in AbiAdi will reside in whollyowned Stratex East Africa (SEA), which will hold all of the companys assets in Ethiopia and Djibouti. Under the terms of Stratexs pact with Thani Ashanti, the latter will acquire a 5% interest in SEA (and thereby a 5% interest in AbiAdi) once Thani Ashanti has expended its minimum US$500,000 commitment at the companys Afar project.

LTHOUGH the mining sector in Ethiopia is quite small, in recent years the country has been reporting annual revenue of over US$100 million from gold exports, and expects to double this amount in 2011. Long reliant on commodity exports such as coffee, the Ethiopian government says it has identified possible reserves of up to 16Moz of gold in different parts of the country. The government charges a 8% royalty on gold, takes a 2% equity for the state and levies a 30% tax. Electricity in Ethiopia is supplied largely from its hydroelectric network, which is being expanded such that the country is likely to become a net exporter of power in coming years.

MINING OPPORTUNITIES
Ethiopia has one existing privately-owned mine, MIDROC Gold Mine plcs Legadembi operation, which has been producing about 100,000oz/y since 2000. However, London-listed Nyota Minerals Ltd has been focusing on the northwest of Ethiopia, where it is developing the Tulu Kapi project, among other prospects. The western portion of Ethiopia, where Nyota is located, sits within the Arabian-Nubian Shield that includes some of the larger gold projects discovered in recent years in Egypt and Eritrea. The same gold-prospective geology exists in Ethiopia, and the company believes that the area around Tulu Kapi has the potential to become a gold province. In May 2010, Nyota doubled the resource estimate at Tulu Kapi to 25.45Mt at 1.68g/t, for a contained 1.38Moz. In the same month, the IFC took a 10% stake in Nyota for US$5.2 million. Melissa Sturgess, Nyotas chief executive, noted in mid-2010 that the company has recently renewed three exploration licences and applied for, and secured, a further two exploration licences and one prospecting licence. She commented we have tested the system and it works well.

Activity at Nyota Minerals Tulu Kapi project mine is located on the Guji Zone in Odo Shakisso, Oromia, 500km south of Addis Ababa. Legadembi is located within Late Proterozoic Crystalline Basement rock (the Adola Greenstone Belt). The loitologies of the area are quartzo feldspathic gneiss, plagioclase-quartz micaceous schist, chlorite schist and amphibolites. The western extreme is Gabro-amphibolite, sometimes foliated and sometimes massive. The Adola Belt is composed of volcano-sedimentary rocks, classified into Middle and upper complexes. The upper complex rocks are confined to a narrow N-S stretching structure known as the MegadoGraben syncline, bounded by the Middle complex rocks both in the east as well as in the west. The rock units invariably trend regionally N-S, have been affected by the N-S, E-W, NW-SE and NE-SW trending faults; the magnitude of their effects range from local to regional. Legadembi Open Pit The Legadembi open-pit mine has a proven ore reserve of 65.94t at an average gold grade of 3.7g/t. The mine started pilot-scale operation in 1987 and reached commercial output in 1989. Following the governments investment policy, the mine was privatised in 1998 (after extraction of 12.39t of gold). Production has averaged 3,500kg/y but the deposit is expected to be exhausted this year.

Gold melting at MIDROC Legadembi Underground Underground development at Legedembi commenced in 2000, and was the first conducted in Ethiopia. As of end-June the total length of underground tunnels was 8,840m. The underground gold reserve is estimated at 10,743kg, with an average grade of 3.59g/t. Underground mining started in June 2009, and the average annual production is 1,086kg. This mine shares the open pits processing plant, which is expected to extend the life of that operation to 2013. East Sakaro Development A feasibility study in January 2008 by MIDROC concluded that the mineable reserve at East Sakaro is 17.54t, at average grade of 10.42g/t. However, the feasibility study takes into account only two veins and the company has identified a number of other veins that have very encouraging results. East Sakaro will be an underground operation, with the ore being processed at the Legadembi plant, which is less than 5km away.
Mining Journal special publication Ethiopia

GOLD OPERATIONS
Ethiopia currently has only one operational mine (comprising both an open pit and underground operation), with another underground mine under development. MIDROC Gold Mine plcs Legadembi

Pilot test for gold and base-metal mining at Terer area, Northern greenstone belt
January 2011

The western portion of Ethiopia sits within the Arabian-Nubian Shield that includes some of the larger gold projects discovered in recent years in Egypt and Eritrea

PROFILE

MIDROC Gold en route to expansion

IDROC Gold Mine, the largest mining company in Ethiopia, is owned by the business tycoon, Sheik Mohamed Hussein Ali Al-Amoudi, the number-one investor in the country of his birth. The company has over 12 years experience and currently employees 1,500 people. MIDROC Gold has progressed in massive strides since its formation and subsequent acquisition of the Legadembi gold mine, located 500km south of Addis Ababa, in 1998. What began as an open-pit operation soon grew into an underground development mining gold resources from deeper levels of the same deposit. At the same time, exploration licences were secured that enabled exploration of the Adola region, which surrounds Legadembi and stretches for dozens of kilometres to the north and south. Exploration activity in the Adola area resulted in the creation of the Sakaro Gold mine, for which a feasibility study was completed in 2008. The mine is located about 4km southwest of Legadembi and is currently under development. A decline is being driven to about 850m and is expected to cross the orebody by 2012, when ore extraction is expected to start. The companys current five-year plan envisages mining activity involving the Legadembi open pit and underground mines, and the Sakaro underground mine. Parallel to enhancing its gold reserve base, opening a new mine and extending the other, MIDROC Gold has optimised the processing plant to boost gold recovery, improved maintenance and upgraded infrastructure required for operations. The management approach has also been updated progressively and Ethiopians have been groomed to take up senior positions in the company. Exploration activity has not been limited to the Adola-Legadembi area. In 2005, an exploration licence was obtained in the Metekel Zone of the Benishangul Gumuz regional administration, located in western Ethiopia. The Metekel area is a green exploration field. It took some time to identify a promising target, but in the end one was outlined in Jilaye. The target has a MIDROC Gold Lab at Bullen

Midroc drilling for gold in Metekel Zone strike length of 4-5km and a width of a few hundred metres. Mineralisation is open at the northern strike and at depth. Currently, exploration activity mainly consists of an advanced core-drilling Arega Dr programme. Although the Jilaye target Yirdaw is the priority, numerous mineralisation has been identified in the same licence area, which has persuaded the company to request new licensing to explore the full potential of the area. Assaying samples from exploration at Metekel were a major challenge as the companys laboratory facilities are located 1,100km away by road at Legadembi. The first few samples were transported over this distance for analysis but, at the end of 2008, the company installed a laboratory in the town of Bullen, about 40km away from the exploration area. The new laboratory mainly uses a combination of wet assay and fire assay with atomic absorption spectrometry reading. So far it has produced more than 11,000 assay reports for gold. Moreover, now that exploration is at the advanced stage, this laboratory is being enhanced, both in terms of the building and equipment, to meet future requirements. MIDROC Golds management is encouraged by the positive outcome of exploring and assaying for gold at Metekel, and there are plans to conduct a prefeasibility study by mid-2011, based on the results of advanced drilling. The plan is to undertake the study in-house and later to commission an independent consultant to review it. Depending on the results, drilling will continue in order to produce data for a feasibility study, which will be handled by an independent consultant. Depending on the outcome of exploration at Metekel, MIDROC Gold will extend its mining life and expand considerably. This expansion will involve the addition of a new open-pit gold mine in an area in the west of the country, which will include a new processing plant and accompanying infrastructure. This would mean an increase in gold production and job opportunities, contribute to the infrastructural development of the region and benefit the supply chain. MIDROC Golds expansion, together with the progress being made by other exploration companies, is expected to open a new era of mining in Ethiopia.

CONTACTS
MIDROC Gold Midroc Ethiopia Technology Group Corporate Center (Mechare Meda Campus) Nefas Silk Lafto Sub-City, Kebele 04 PO Box 2318, Addis Ababa, Ethiopia Tel: +251 011 372 82 18/19/20/21 Fax: +251 011 372 82 27 E-mail: Mgold1@Ethionet.Et Website: www.midroc-ethiotechgroup.com/ MGOLD/HOME PAGE/MGOLD-HOME PAGE.html Contact: Dr Arega Yirdaw, CEO & General Manager Tel: +251 011 372 82 34

10

Mining Journal special publication Ethiopia

January 2011

ETHIOPIA

Competitive edge stays at core of legal regime

Various amendments to proclamations and regulations introduced in the early 1990s aim to keep the countrys mining sector buoyant

Geology mapped
Geoscientific mapping of the country started in 1968 with the establishment of the Geological Survey of Ethiopia (GSE). This work was conducted either independently by the Ethiopian government or in collaboration with other international organisations. The entire country is now covered by a 1:2,000,000 geological map (first published in 1973, with an edited version being produced in 1996). Also, more than half of Ethiopia is currently covered by 1:250,000 geological maps, and the country is due to be 100% covered at this scale by 2015. All of these maps are available in printed and electronic versions. The GSE was recently reorganised such that all the processes are incorporated under one facility Geochemical surveys at different scales have been conducted in different parts of the country. Particular emphasis has been given to assess the mineral potential of the Precambrian rocks. To date some 20% of the country is covered by maps with a scale of 1:100,000 and less, and systematic geochemical mapping (at 1:250,000) integrated with geological and geophysical mapping is underway. The Ethiopian government has approved a five-year (2011-15) growth and transformation strategic plan. In line with this strategic framework it has been decided to: Complete the 1: 250,000 geological map coverage by 2015; Increase the coverage of the 1:250,000 geochemical map of the country to 49%; and Compile a 1:2,000,000 geochemical atlas and metallogenic map of the country. loans etc out of Ethiopia. The government allows losses to be carried forward for ten years, and dispute settlement is through negotiation and international arbitration In return, the government requires the payment of relatively low royalties, ranging from 3% for construction materials to 8% for precious stones and minerals. This calculation is based on the value of mine-mouth mineral production.

HE minerals of Ethiopia were not available to the private sector during the communist regime of 1974 to 1991. Only government institutions had the right to explore and develop the countrys mineral wealth. In 1991 a new market-oriented economic policy was introduced. In the mining sector, the government made changes to encourage the participation of private capital in mineral prospecting, exploration and development. In the early 1990s, the Mining Proclamation 52/1993, Mining Regulations 182/1994 and Income Tax proclamations 53/1993 were issued to attract private investment. These proclamations were consecutively amended, so as to remain competitive. A new law (Mining proclamation 678/2010) has been issued, and came into effect in August 2010. The new proclamation provides: Non exclusive reconnaissance rights (for a maximum period of 18 months); Initial three-year exclusive exploration licenses, with two renewals of one year each; and Mining licence for 10 or 20 years for small-scale

Mining Licence Application Areas

0 50 100 200 300 km 400

Active, Exploration Licence Active, Large-scale Mining Active, Small-scale Mining

Dry Road Main Road Regions

and large-scale operations, respectively, with unlimited renewal periods (of 5 or 10 years each). The new proclamation also makes provision for the adequate health and safety of employees, environmental protection, and for environmental and social impact assessments (depending on the type and nature of the project). The proclamation also requires a communitydevelopment programme, guarantees the licensees right to sell the minerals, provides exemption from customs duties and from taxes on the equipment, machinery and vehicles necessary for the mineral operations. The government also guarantees the opening and operation of a foreign currency account in Ethiopia, and the retention of portion of foreign currency earning and remittance of profits, dividends, principal and interest on foreign

Contacts
Mineral Licensing and Adminstration Department, Ministry of Mines: PO Box 486, Addis Ababa, Ethiopia Tel: +251 116 461214, Fax: +251 116 463454 / 463364 / 463426 Website: www.mome.gov.et E-mail: mineral_operations@mom.gov.et Geological Survey of Ethiopia: PO Box 2302, Addis Ababa, Ethiopia Tel: +251 116463325 / 116463329 Fax: +251 116463326 Website: www.geology.gov.et E-mail: survey@ethionet.et
The Mineral Operations licence application form is available from the website: www.mom.gov.et.

Ministry Licences, Active, Exploration

0 50 100 200 300 km 400

Active, Exploration Licence Active, Large-scale Mining Active, Small-scale Mining

Dry Road Main Road Regions

January 2011

Mining Journal special publication Ethiopia

11

Ticker:

AIM : NYO ASX : NYO

Market Cap:

Nyota Minerals Limited is an Australian registered company listed on the Australian Stock Exchange and the AIM Exchange in London. Nyota is focused on the exploration of over 3,550 km2 of prospective land in western Ethiopia and the ongoing exploration and development of the Tulu Kapi Deposit, which has a total Inferred JORC resource of 1.38 million ounces of gold, defined at a cut off grade of 0.5 g/t gold. Key Points GBP 22 million fundraise completed. 50,000 meters of drilling planned over next 12 months with 4 drill rigs on site. 44,000 line km airborne geophysical survey commenced over 3,550 highly prospective new licence areas. Preliminary Economic Assessment study due for completion in early 2011. Environmental & Social Impact Assessment due in early 2011. Outlook The Tulu Kapi Deposit is open to the north, south, west and at depth, with a further resource update expected in early 2011. Aggressive exploration programme is already underway and will bring newsflow throughout 2011. Nyotas Environmental and Social goals are consistent with Equator Principle guidelines and are endorsed by International Finance Corporation.

GBP 125 million*

Mid Share Price 52 week high/low:

0.29 - 0.09*
Shares on Issue:

455 million*
Directors Holdings:

5.6%
*12 January 2011

Drilling at Tulu Kapi

Visible gold on core sample

Technical In early December Nyota announced further significant drill results as part of an update on the Companys Tulu Kapi Project. In particular, a high-grade gold feeder zone style mineralisation characterized by abundant visible gold and associated high gold grades: TKBH-07 intersecting 15.70 meters, averaging 37.04 g/t gold.This significant discovery is a strong indication that the Tulu Kapi Deposit is a part of a large magmatic gold bearing system and offers potential for further discoveries and expansion. The combination of mineralogy and geophysical signature specific to this mineralization style has been noted elsewhere within the Tulu Kapi area by Noyta implying the possible presence of multiple high-grade feeder zones with the current gold resource largely reflecting distal mineralization. Regional An initial 2,000 meter (m) regional diamond drilling programme for the Billa-Guliso and Yubdo Exploration License Areas commenced in early December 2010. Initial focus is on several high-grade gold targets identified by Nyota in 2010. The drilling programme will be undertaken with a recently commissioned fifth drill rig and will consist of approximately 10 holes concentrated in the NE portion of the Guliso Trend and the SE portion of the Yubdo license. It will begin on

the Soyoma Target where previous trench results have returned up to 14.2 m @ 8.2 g/t gold over a 20 m strike-length. The Dina Target is located 2.5 km south-west of Soyoma. Previous drilling results returned up to 8.75 m @1.23g/t au and test borehole results returned up to 7.1 m @ 8.23 g/t Au. Many other regional targets are considered to be high priority and are well deserving of continued exploration. Community Development JEMA International Consulting PLC (Addis Ababa) and SRK consulting (Johannesburg) have been commissioned to complete An Environmental and Social Impact Assessment (ESIA) to Equator Principle Standards for the Tulu Kapi Project.The ESIA will include baseline field work, socioeconomic studies and long term monitoring programmes such as water and air quality. Individual specialist studies will be compliant with Equator Principles and with IFC standards. Nyota has also implemented a comprehensive OH&S Programme. On 7 December 2010, Ethiopian Minister of Mines, Mme Sinkenesh Ejigu opened a 12 classroom school constructed by Nyota, for the local community. Equipment has also been provided by Nyota and currently 454 students are registered to attend.

Key Field Managers

Channa Pelpola: Manager, Environmental and Social Channa (B.Sc., Carleton, M.Sc., Simon Fraser) has over 15 years of environmental assessment experience which includes conducting technical and environmental assessments, project managing large scale multi-disciplinary projects, and advancing innovative environmental solutions. Kevin Piepgrass: Manager, Exploration Kevin Piepgrass (B.Sc., University of Alberta), a geologist who has worked on advanced exploration and development projects in North and South America. His experience includes resource estimates and project advancement to the feasibility level. Kevin has managed a number of large projects in the Yukon and Guyana including a joint venture with Newmont.

Board of Directors
Melissa Sturgess: Chairman David Pettman: Non Executive Deputy Chairman Terry Tucker: Executive Director and CEO Dr. Evan Kirby: Non Executive Director Martyn Churchouse: Executive Director, Technical Mike Langoulant: Executive Director, Finance

Share Price Performance 1 Year Timeframe

30 25 GBP 20 15 10 Jan 10 Mar 10 May 10 Jul 10 Sep 10 Nov 10 5 Jan 11

Major Shareholders
Shareholder % holding As at Nov 2010

International Finance Corporation JP Morgan Directors

10% 10% 5.6%

Analyst Coverage
Broker Ocean Mirabaud Bell Potter Pattersons Analyst Simon Gardner-Bond Nick Chalmers Stuart Howe Alex Passmore Tel Number +44 207 786 4370 +44 207 321 2508 +61 3 9235 1782 +61 8 9263 1111

UK office Manfield House 1 Southampton Street London WC2R 0LR Tel: +44 (0) 20 7379 5012 Fax: +44 (0) 20 7395 1931

Jan 10

www.nyotaminerals.com

ETHIOPIA

Platinum mineralisation at Yubdo

By Gebre Egziabher Mekonen

ASED on previous studies, the ultramafic belt of western Ethiopia is geological favourable for platinum-group metals (PGMs). The belt extends more than 150-200km north-south, in general, and comprises all types of ultramafics, such as Bushveld type layered intrusions as well as the Alaskan-type intrusions. The existence of the primary PGMs at the Yubdo ultramafic belt in western Ethiopia demonstrates a very promising potential for these metals in that region. The Yubdo mafic-ultramafic intrusions are an Alaskan-type intrusion, which are mainly composed of hornblende clino-pyroxenite, peridotite and dunite. It is elliptical in shape and has an exposed outcrop length of 9km and a width of 4-5km. The rocks are affected by greenschist to lower amphibolite facies metamorphism, and also by a late stage hydrothermal fluid, which played a role in the remobilisation of precious metals. The PGMs were discovered in the Yubdo Geochemical map of the Yubdo area ultramafic rocks for the first time in 2000 from borehole samples drilled in 1969 by Duval Corp. The primary PGMs documented in the chromites and serpentinised dunites have Tetraferroplatinum (PtFe), Issoferroplatinum (Pt3Fe) and Tulameenite (Pt2FeCu) compositions. The 1.0m grab borehole samples returned platinum values reaching up to 806ppb and gold values reaching up to 780ppb. values, mainly in exposed mined sections. The recent pitting exploration activities in the All the samples, boreholes, pits, trenches and Yubdo ultramafic by Yubdo Platinum and Gold rock-chips of Yubdo ultramafic body showed high Development plc (YPGD) showed very high platinum values of platinum and gold, along shear zones, and values in the weathered Saprolite sections over the the Yubdo ultramafic body is very attractive target for primary mineralised zones, reaching up to 1.3ppm Pt. primary precious metals exploration activities. Trenching activities by YPGD, following pitting results, showed platinum mineralised zones reaching OTHER OCCURRENCES 10m at 0.81g/t Pt and 2m at 1.13g/t Pt. Layered ultramafic intrusions are also mapped at The detailed geological mapping and rock-chip north-south-oriented lineaments at Sirba Abay sampling, by YPGD, of the altered rocks next to the outcrops, the far northern part of the western NE-SW trending shear zones returned up to 1.8g/t Pt Ethiopia ultramafics.

The Yubdo ultramafic body is very attractive target for primary precious metals exploration activities

Occurrences of PGMs were also reported in this belt during 2005 by the private company Wellga Mineral Development plc.

A) Magmatic PGM enclosed in disseminated chromite within dunite. The dunite is sulphide poor. B) The same grain. The chromite is zoned with a Cr-rich magmatic core where the PGM is enclosed and an altered rim-rich in Fe3+ (ferritchromite), which in some grains becomes pure magnetite. C) PGM in serpentised zone
References Belete, KH; 2000.The Petrology of Mac-Ultramac Rocks and Surrounding Basement,Western Ethiopia, and Genesis of Platinum-Group Minerals Related to an Alaskan Type Ultramac Intrusions of Yubdo Area. Doctoral Thesis, Institute of Mineralogy and Petrology, University of Graz, Austria; 278p. Belete, KH; Mogessie, A; Hoinkes, G; and Ettinger, K; 2000. Platinum-Group Minerals and Chrome-Spinels in the Yubdo Ultramac Rocks,Western Ethiopia. Journal of African Earth Sciences; 30, pp10-11. Duval Corp, US, 1969.Yubdo Evaluation Report,Welega Province, Ethiopia. Edited by Fields, ED; Mogessie, A; Belete, KH; and Hoinkes, G; 2000.Yubdo Tulu-Dimtu Mac-Ultramac Belt, Alaskan-Type Intrusions in Western Ethiopia: Its Implication to the Arabian Nubian Shield and Tectonics of the Mozambique Belt. Journal of African Earth Science; 30, p62.

14

Mining Journal special publication Ethiopia

January 2011

PROFILE

Stratex discovers the future in the Afar

INCE making its entry into Ethiopia in September 2009, Stratex International has rapidly developed a substantial exploration portfolio and become one of the most active exploration companies in the country. As well as two joint-venture programmes in northern Ethiopia and its own 100%-owned licences, Stratex has identified the eastern region of Afar (extending into Djibouti) as a new, extensive gold mineralised sector of the East African Rift system. This exciting development demonstrates that Stratex is truly applying its motto of discovering the future.

Key mineralised zones identified at Megenta, Afar Project (red = silicified sediments). Inset, far left: Chalcedonic silica alteration with pyrite containing ~16g/t Au from Hyena Zone, Megenta

THE AFAR EPITHERMAL DISTRICT

Since establishing the company in 2005, Stratexs management has recognised the need for greenfield exploration to define entirely new mineralised districts to meet the current and future demand for metals, rather than recycling old prospects. With the identification of multiple epithermal systems in the Afar Depression of Ethiopia (and into Djibouti), Stratex has achieved this objective. The company has demonstrated how the application of up-to-date science, coupled with the flexible decision-making and operation that smaller companies enjoy, can lead to rapid exploration success. The potential of the Afar Depression was realised after Stratex targeted the Main Ethiopian Rift (MER) in this unexplored region of northeast Africa, based on the known association of rift settings with bimodal volcanics and bonanza-style low-sulphidation (LS) gold mineralisation in the Nevada Rift and the Deseado Massif of southern Argentina. Gold deposits of this type were developed at relatively shallow depths beneath ancient hot-spring systems Stratexs exploration has identified multiple systems of this nature in the Afar region. The Afar Depression is a topographic low at the northeastern limit of the MER and resulted from

three-way crustal extension a tectonic triple-junction where the MER meets the Red Sea and Gulf of Aden spreading ridges. These ridges are characterised by voluminous volcanic activity and the development of associated hot-spring systems. In October 2009, the company made its first discovery here: the Megenta gold prospect. The Megenta system comprises a series of northwest to north-northwest striking, gold-bearing silicified and brecciated fault structures, which are confined to a major, normal fault system that bounds the southwestern side of the Manda-Hararo-Gobaad rift. The fault zone juxtaposes a basalt lava sequence of the Afar Stratoid Series with a thick succession of subhorizontal, siliciclastic red-bed sedimentary rocks of Holocene age. To date, the highest value obtained by Stratex from these fault-controlled zones of mineralisation is 16.7g/t Au. Since discovering Megenta, Stratex has used its first-mover advantage to secure exclusive exploration licences (EELs) over the hot-spring systems it has identified in the wider Afar region, while also acquiring ground over similar prospects in Djibouti. This key new epithermal play has attracted the attention of Thani Ashanti (an AngloGold Ashanti JV company with Dubai-based Thani Investments), which is earning into the Afar Project, comprising five licence areas in Ethiopia and a further six in Djibouti. This is the first entry of a gold major into Ethiopia and endorses Stratexs belief in the regions potential as a significant new gold district. Thani Ashanti will fund US$1 million over the first 12 months, including at least 3,000m drilling at Megenta, and a further US$2 million in the second year to earn to 51%. Drilling at Megenta is expected to start in March 2011.

Detailed mapping and sampling has defined gold mineralisation over 1,500m in strike and up to 200m wide. Significant highlights include: 84m grading 1.04g/t Au; 31m grading 0.82g/t Au; 11m grading 4.39g/t Au. The company aims to drill the project in 2011. Based on the favourable geology of the ANS, Stratex has acquired two additional EELs, at Tigray and Berahale, targeting precious and base metals. Early work at Tigray has identified a large granitoid intrusion with associated polymetallic quartz veins. Stratex also has the option to earn up to 75% of the Abi Adi gold project by expending US$1 million. The property is held by Ethiopian company LozBez Mining. Stratex has already defined significant gold mineralisation over a 5,000m strike length of the mineralisation, occurring as gold-bearing quartz veins containing copper and lead minerals, and closely associated with a series of elongate granitoid intrusions. There are many similarities with Chalices Koka project in northern Eritrea, which has a current resource of 840,000oz Au related to lead-rich, gold-bearing veins within micro-granites. Despite having only been operating in Ethiopia for slightly over a year, Stratexs original view that the country had much to offer and was grossly under-explored has been completely vindicated. The company has an extensive portfolio of targeted projects, three JVs with local and international partners, and lays claim to the discovery of a completely new gold district comprising multiple low-sulphidation systems with multi-ounce gold potential in the Afar Depression. It is the companys opinion that it does not get much better than that.

NORTHERN ETHIOPIA
North Ethiopia contains large tracts of the Arabian Nubian Shields (ANS), highly prospective rocks known to host mineralisation in Egypt, Sudan, Saudi Arabian and Eritrea. This areas geology is a direct extension of that in Eritrea, where discoveries such as Nevsuns Bisha deposit have attracted attention. Unlike Eritrea, northern Ethiopia has seen little in the way of systematic exploration. Stratex initially focused on a JV with Plus-listed Sheba Exploration over the Shehagne gold occurrence, where Stratex is earning to 60% by funding exploration to 350,000, with the option to go to 80% by funding the project to feasibility.

CONTACTS
Stratex International 180 Piccadilly, London W1J 9HF, UK Tel: +44 (0)20 7830 9650 Fax: +44 (0)20 7830 9651 E-mail: info@stratexplc.com Contact: David Hall, Executive Director for East Africa Website: www.stratexinternational.com Ethiopian Exploration Office House 1060, Kebele 5. Sub city Bole, Addis Ababa, Ethiopia Tel: +251 (0)116 624 367

Sulphide-bearing quartz vein in granite, Abi-Adi project, southern Tigray

January 2011

Mining Journal special publication Ethiopia

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More about Ethiopia? Visit our website for an extended version of this supplement www.mining-journal.com/supplements

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