Tanzania: a miner’s elephant country

Better known for red-cloaked Masai tribesmen and big game safaris, the United Republic of Tanzania is actually a phenomenally mineral-rich land.

Formerly known as British East Africa, and German East Africa before that, Tanzania came into being in 1964 upon the merger of Tanganyika, Zanzibar and the Pemba Islands. The country lies just south of the equator, on the east coast of Africa between the large lakes of the Rift Valley system and the Indian Ocean. It covers some 945,000 sq. km and is larger than the total area of France, Belgium, Germany and Switzerland, or slightly smaller than Texas and New Mexico combined.

Tanzania is a tropical country with climatic zones encompassing a humid coastal plain, a hot and dry rift area, a humid lake region, and temperate highlands. The estimated population of Tanzania is 27 million, fairly evenly divided between Muslims and Christians. Swahili is the official language of Tanzania, though English is widely used as well.

Long bypassed by the international mining industry because of its socialist policies, Tanzania changed course in the late 1980s, and it wasn’t long before foreign investment returned, not only in mining but in other sectors as well. Spared the turmoil and authoritarian regimes of many of its neighbours, Tanzania remains a relative oasis of peace, political stability, democracy, and regulatory transparency, particularly by African standards.

The country is well-served by international land, sea and air transportation routes. Aside from a few paved inter-city roads, poorly maintained dirt roads connect all towns and villages. There are also three major railway lines. Tanzania’s location on the Indian Ocean places it in an advantageous position for international shipping. Numerous airlines operate in and out Tanzania through two airports: Dar es Salaam and Kilimanjaro International, and several domestic airlines provide regular and reliable service.

Tanzanian mining law is embodied in the Mining Act, Government Notice No. 214, published in 1999. Licensing is based on a 3-tier system (not including small-scale licences that are only available to local artisanal miners):

n a reconnaissance prospecting licence grants exclusive rights for a period of 12 months;

n a prospecting licence grants exclusive rights for a period of three 3 years; and

n a mining licence can be granted for up to 25 years or more, depending on the estimated life of the prospective mine.

The geological framework of Tanzania reflects the geologic history of the African continent, beginning with the evolution of an Archean Shield through to the opening of that great chasm known as the East African Rift. The Archean rocks of Tanzania (more than 2.5 billion years old) consist of granite-greenstone belts, including the Nyanzian System, a series of typical Archean volcano-sedimentary sequences, or “greenstone” belts, within a much larger area of granite-gneiss complexes. The Nyanzian greenstones are of major economic importance, as they host most of Tanzania’s gold deposits. Almost all of Tanzania’s known kimberlites, diamondiferous or not, are also hosted in rocks of this system.

Tanzania’s gold potential is not even close to being well-explored, yet the country is already host to one giant gold deposit, and several more are known to host reserves approaching 1 million oz. or more. All are found in the aforementioned Archean rocks in an area south of Lake Victoria, and most appear to be associated with iron-rich lithologies in proximity to shear zones. The biggest is Bulyanhulu, owned by Barrick Gold (ABX-T). Hosting more than 12 million oz. gold with average grades at or near 15 grams per tonne, the deposit began production in 2001. Since then, it has produced an average of 400,000 oz. per year at a cash cost of US$173 per oz.

Barrick has further established itself in Tanzania by taking over Pangea Goldfields, which has several projects in the country, including Golden Ridge, which is 30 km from Bulyanhulu. After acquiring the remaining half-interest in the project in early 1999, Barrick undertook an aggressive exploration program. Resources exceed 1.5 million oz.

Barrick, through Pangea, has a joint venture with AngloGold (AU-N), namely the Kahama project, in which Pangea holds a 70% interest and where reserves are pegged at 26 million tonnes grading 2.3 grams gold per tonne. Kahama is 50 km south of the Golden Ridge project. Pangea has also been evaluating its 70%-owned Tulawaka deposit, which has a resource of 1.1 million oz. gold; Explorations Minires du Nord (MDN-T) owns the remaining 30%.

Based on ongoing projects and developing mines, Tanzania’s gold reserves are conservatively estimated at 25 million oz. Following the development of four gold mines, the country’s gold production doubled to 34 tonnes (more than 1 million oz.) in 2001, overtaking Zimbabwe as Africa’s fourth-largest producer. Tanzania’s first gold mine, Golden Pride, was officially opened in February 1999 and is wholly owned and operated by Australia’s Resolute Mining. The mine has increased its proven and probable reserves to contain 13.5 million tonnes grading at 2.3 grams per tonne gold, or 988,100 oz.

The Geita mine, jointly owned by Ashanti Goldfields (ASL-N) and AngloGold, hosts 49 million tonnes grading 3.5 grams per tonne, or 5.5 million oz. It is producing 500,000 oz. per year at a cash cost of less than US$180 per oz. A second property, Nyamulima Hill, jointly owned by AngloGold and Ashanti, hosts a reserve of 2 million oz.

Australian-listed Spinifex Gold, through wholly owned subsidiary East Africa Gold Mines, owns three principal properties, Buckreef-Rwamagaza, Kitongo and Nyakafuru, which collectively contain a global gold resource of 2 million oz.

Axmin (AXM-V) is exploring a property in the Siga Hills area where a 2-km-long soil anomaly was identified. Trenching has identified a zone of deformation and shearing up to 50 metres wide across the contact between banded iron formation and volcanic rocks. Deformation is coincident with anomalous gold, typically in excess of 300 parts per billion gold and including 3.1 grams gold per tonne over 10 metres and 2.2 grams over 4.5 metres.

Also active in the Siga Hills area is Ormonde Mining, listed on the Irish Stock Exchange. Again, banded iron formation is cut by shear zones, and widely spaced trenching over a 2-km-long gold-in-soil anomaly returned highlights of 10 metres grading 3.1 grams gold per tonne and 4.5 metres of 2.2 grams gold.

Australian junior Sub-Saharan Resources continues to drill its Nyanzaga project, where the 120-plus-metre-wide Tusker zone has been defined over a strike length of 450 metres and where drilling has intersected 109 metres grading 1.57 grams gold per tonne, 35 metres grading 3.61 grams, and 126 metres grading 1.2 grams. Placer Dome (PDG-T) has farmed into the project.

Tan Range Exploration (TNX-T) is also active in Tanzania, with more than 3,800 sq. km. held in roughly 70 licences, of which several are being jointly explored with Barrick. African Eagle Resources, listed on the OFEX and formerly known as Twigg Minerals, is exploring the Miyabi property, where gold is known to exist in a shear zone.

Last but not least, Australian-listed Goldstream Mining is active on the Mibango platinum project in western Tanzania. An intrusion measuring 35 km long by 3 km wide, Mibango hosts platinum mineralization in weathered chromites that have been exposed in trenches and shallow drill holes. London-listed Lonmin has entered into a joint-venture agreement with Goldstream to explore the deposit.

Rimming the Archean rocks to the east is a series of Proterozoic high-grade metamorphic rocks consisting of gneiss and minor mafic and ultramafic intrusions.

These rocks extend south from Kenya through Tanzania and all the way to Mozambique and host o
ne of the world’s greatest concentrations of coloured gemstone deposits. A dazzling array of gemstones of every colour and variety imaginable is on display. Sapphires and rubies — including a unique opaque variety of ruby, anyolite, found within pistachio-green zoisite — are found toward the north. A wide assortment of plum-to-mandarin-coloured garnets can be found at several locales, along with the unique and rare emerald-green variety known as tsavorite (originally discovered in Kenya).

Emerald and alexandrite are found near Lake Manyara, and the region also features zircon, tourmaline, amethyst, sphene and spodumene. In almost all cases, production comes both from independent small-scale miners and private Tanzanian companies.

Most famous, and totally unique to Tanzania, is the blue-purple variety of zoisite known as tanzanite, found exclusively in the Merelani Hills, near the city of Arusha. The region was formerly the scene of a mining rush, and today more than half of its production is under the control of Johannesburg-based African Gem Resources. The company is one of the first to approach the mining and marketing of coloured gemstones in the same fashion as diamonds, using modern mining methods, and downstream processing from cutting and polishing through to international marketing. Tanzanite is expensive and much in demand.

As if being host to numerous huge gold deposits and one of the world’s great coloured-gemstone belts was not enough, Tanzania also has the world’s largest diamondiferous kimberlite deposit. John Williamson, a Canadian geologist in the employ of De Beers, discovered it in 1940 after many months of fruitless prospecting in the Shinyanga region, south of Lake Victoria. News of the discovery came as a rude shock to De Beers and led to a visit by Harry Oppenheimer himself in order to negotiate the partial acquisition of the deposit from Williamson. During the period of socialist rule in Tanzania, the mine was nationalized and renamed “Mwadui,” but majority ownership by De Beers has since been re-established.

The Mwadui and adjacent New Alamasi diamond deposits occupy a former crater. Exceeding 1.5 sq. km, the crater was produced by the explosive eruption of a kimberlite about 50 million years ago.

Mwadui produced more than 13 million carats between 1940 and 1973, and is still in production. Mining of the surrounding black “mbuga” soils, gravels, and weathered tuff has yielded 17 million carats of diamonds since 1940. In its early years, grades reached as high as 107 carats per hundred tonnes (cpht). Today it is down to the 10-to-20-cpht range in the kimberlite, and 3 to 7 cpht in the surrounding placers.

Among the famous diamonds recovered from this giant deposit is a 54-carat pink diamond, which was cut into a 26.6 carat brooch and presented to then-Princess Elizabeth in 1947. Tanzania’s largest diamond, weighing 241 carats, was found at the Williamson mine in 1956. In October 2002, a 47-carat clean pink diamond was recovered from the open pit.

Curiously, the Mwadui pipe had no magnetic expression.

More than 300 kimberlite pipes are known across Tanzania, and about 20% are believed to be diamondiferous. All are found within the Archean Craton, mostly in clusters within a 200-km radius of Shinyanga. Despite Tanzania’s tremendous diamond potential, there are few domestic and no international mining companies exploring, aside from the typically secretive exploration activities of De Beers.

Odyssey Resources (YOD-V) has been evaluating a package of properties hosting both placer- and past-productive kimberlite-hosted diamonds owned by Soud Group, a private Tanzanian company. A recent placer production run from one of Soud’s properties recovered 400 carats from 250 tonnes of gravel. Notable stones recovered from this same property include an 89- and a 67-carat stone. Also, brown diamonds are common, along with fancy yellow, green, and blue ones. From another Soud property, crews have recovered a 400-carat white rectangular-shaped diamond, a 34-carat pale and clean white diamond, and a 28-carat pale yellow diamond. The properties host several untested kimberlites as well.

Hundreds of independent placer diamond miners and diamond buyers may be found scattered across north-central Tanzania, from Mwanza on the southern shores of Lake Victoria, to Shinyanga, just down the road from the Mwadui mine. All are engaged in the thriving, independent diamond trade, a model of free enterprise that brings significant wealth to countless African farmers and their families, and a host of independent diamond buyers from all over the world.

Sadly, most if not all, of these people will be put out of business as a result of the Kimberley Process, an ill-conceived and duplicitous set of regulations requiring that the origin of all diamonds be inspected and certified. Although large diamond producers are able to incorporate this bureaucracy into their mining and marketing process, the independents cannot. Of course, this suits the main diamond producers just fine, as it will eliminate more than 20% of global production and force consumers to come to them instead.

There are few countries around the world that can claim such a rich and diverse mineral endowment. The famous “big five” — lion, leopard, cheetah rhinoceros, and elephant — may be what have historically attracted people to Tanzania. However, today’s miners in Tanzania have their own big five: gold, diamond, ruby, alexandrite and tanzanite. Now that’s elephant country!

— The author is a certified gemologist and professional geologist. He is executive vice-president and exploration manager for Odyssey Resources, a Canadian junior active in Turkey and throughout the Mediterranean and Africa.