“We first began working in Eritrea in 2003. Since then we’ve drilled about 150,000 metres, spending just shy of $30 million. We’ve established four deposits so far. Three of them are VMS with indicated resources on them, one of them is a gold deposit with an inferred resource. We began in November a feasability study on the Debarwa VMS deposit. It’s an extremely high grade copper-gold-zinc VMS deposit. As part of that study we’re looking at what we call the DSO Zone which is approximately 18% to 20% copper, and we’re looking at starting mining operations by mining it and direct shipping it. The feasability study will also consider the rest of the deposit.
“With that DSO option I mentioned, Debarwa is tailor-made for a little company like us to get into production. However most of our value is in the northern deposit which contains the large Emba Derho VMS deposit which is 62.5 million tonnes in the current indicated resource. We’ve already begun work on it, but we’ll announce who we’ve awarded the contract to early next week. The feasability study and the prefeasability study for the northern projects are scheduled to be completed around October of this year.
“The assays that were released today are amazing. Some of the highest copper grades you will see anywhere in the world. It’s the same kind of geology as the Bisha Deposit—Nevsun‘s project. They announced earlier this year that they began to pour gold and they’re in the process of commissioning the mine which you’ll likely see sometime in the next month. Debarwa is very similar; it has a gold oxide cap from surface down to about 30 metres, a supergene copper zone from about 30 metres down to about 60 metres, and then primary sulfides from 60 metres open at depth.
“The outlook for the project is excellent. These VMS deposits in Eritrea are very prolific and we still have a lot of exploration outside to go.We can get into production with fairly low capital costs. Emba Derho would have much larger capital costs but we feel that we would be able to raise the money to build the mine.
“It’s a dream to work and operate in Eritrea. All operators will say the same thing. It really is a dream. You’ve got the full support of everyone in the country—all levels of government. The [common] perception is something that’s been keeping the share price of Nevsun and us and other operators down, however I think that’s about to change with operations beginning at Bisha. I think the world mining community will see that this is a great place to operate.”
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