Megado Gold has launched its initial public offering and brings to the market five granted exploration licences and one licence application located in Ethiopia — a country which had a large gold mine operating some 6,000 years ago.
This is a gold hunt in the land of the Biblical figure, the Queen of Sheba.
Sheba was a kingdom that stretched over present day Ethiopia and Yemen, and the Queen of Sheba was recorded as visiting Jerusalem in the eighth century BC loaded with gold.
Megado’s granted projects cover 511 square kilometres, with the licence application to add another 227sq km.
The offer is the issue of 25 million new shares to raise $5 million, with provision for $1 million in oversubscriptions.
Megado will list under the ticker code ‘MEG’ with the official quotation of its shares scheduled for the end of October.
The company’s managing director Michael Gumbley has been operating in Africa, including Ethiopia, for more than 15 years and has managed $500 million for infrastructure projects — and, over the past seven years, $80 million for Ethiopia.
Megado’s executive director Chris Bowden was based in Ethiopia for five years, leading a team exploring for gold across the Nubian Shield. The team discovered the Dish Mountain gold deposit containing close to two million ounces.
Bradley Drabsch, the chairman, is an exploration geologist.
Apart from Dish Mountain, other mines are Lega Demibi and Sakaro (3Moz between them) and there is also the 1.7Moz Tulu Kapi deposit.
Megado exploring on the famed Nubian Shield
Last year Ethiopia, with 115 million people making it the second most populous country in Africa after Nigeria, announced it would remove barriers to foreign investment in mining under its plan to lift that industry’s share of gross domestic product from 3% to 10% by 2030.
The country already has Africa’s largest carrier, Ethiopian Airlines and, thanks to Chinese financing, has a new modern railway line linking Addis Ababa to the port in the neighbouring country of Djibouti, Ethiopia itself being landlocked.
All the Megado projects are located on the Arabian-Nubian Shield, which is host to active mines and gold occurrences,
The gold belt targeted by Megado was prospected between 1979 and 1982 by the state mineral resources agency.
This identified a number of primary and placer gold targets.
The company’s ground lies immediately along strike from Lega Dembi and Sakaro mines.
Dr Bowden said minimal modern exploration has been conducted in Ethiopia by comparison to similar greenstone belts in West Africa, Canada and Western Australia.
“We see Ethiopia as representing the next frontier in African mineral exploration,” he added.
“Numerous” high-priority gold targets have already been identified, five experienced Ethiopian geologists have been recruited, drilling contractors engaged, and drilling is scheduled to begin the December quarter.