Sheba Exploration (UK) plc

November 27, 2009 08:30 ET

Interim results for the 6 months ended 31 August, 2009


                                  Sheba Exploration (UK) Plc

                 Interim results for the 6 months ended 31 August, 2009

The  Directors  of Sheba Exploration (UK) Plc (the "Company") are pleased to announce  the  un-audited
interim results for the 6 month period ended 31 August, 2009.

Operational Highlights

The Company continued gold prospecting during the period under review.

At  Shehagne  EEL  channel sampling and mapping revealed high-grade quartz veins with extensive  gold-
bearing  alteration  halos around them. Soil sampling continued at Una Deriam EPL,  resulting  in  the
strongest gold in soil anomaly yet encountered, with a peak value of over 7000 ppb gold.

Negotiations  for  an option agreement on Shehagne EEL with Stratex International Plc  continued  from
April to August, resulting in a letter of agreement signed by both parties on the 29th August 2009.

Shehagne Exclusive Exploration Licence

Channel  sampling  was  carried out at Hadush Adi, located at the southern end of  the  Tsemetti  gold
anomaly at Shehagne EEL (previously trenched and drilled with very encouraging results, including  one
interval of 20 metres grade 3.15 g/t). High grade gold intersections were made in river bed exposures.
These  revealed the extent of gold impregnation into the country rocks around the controlling  quartz-
filled  fracture  system  and  gave hope of a larger overall volume of gold  mineralization  than  was
previously indicated by the thin quartz vein feeders visible on the deeply weathered whale-back  hills
above  the  rivers.  Following  completion of the first 3 year exploration  period,  the  project  was
evaluated by the government compliance team in June and was given the go-ahead for licence renewal  in
September. Following two previous visits in 2008, representatives of Stratex International Plc, an AIM-
quoted  company,  made  a  visit  to Tigray in June and negotiations  for  an  option  agreement  were
initiated.  On 29th August, a letter of intent was signed. According to this agreement, the  terms  of
which are binding on both parties, Stratex can earn up to 80% of the Shehagne Project by financing all
exploration and development up to the end of a bankable feasibility study. Initially they will earn up
to  60%  of the project, by financing exploration for a total amount of GBP350,000 over the 21  months
following initiation of the agreement.

Una Deriam Exclusive Prospecting Licence

Infill soil sampling continued towards the south of the licence area, following the discovery of  high
gold values in soil in the previous year. Some very high gold in soil values were encountered in April
over  a  strike length of 600m, with a peak value of over 7000 ppb gold. The area, known as Da'talian,
was  prospected more than 100 years ago, with many of the better soils values associated with  remnant
adits and box-cuts which are still visible. The gold target revealed by soil sampling is now ready for
trenching and RAB drilling to ascertain the width and grade of gold in bedrock below the soil anomaly.
Satellite  image interpretation was also carried out over the area and shows a marked alteration  zone
encompassing  Da'talian  and the company's Mereto gold prospects Teska, Adi Gefa  and  Ndaba,  located
several  kilometres to the north. The extent of gold anomalism has now been traced for  6  kilometres,
making  this  project  the  largest of the company's gold projects. An application  for  an  exclusive
exploration licence is now underway.

Further reconnaissance work was carried out to the south of Una Deriam during the period and more soil
sampling is planned in that area.

Winibo and Finarwa Exclusive Prospecting Licences

A  small  amount  of  soil  sampling was carried out at Winibo across  the  copper  zone  and  further
prospecting  was  carried  out  on in the general area, with a view  to  understanding  the  style  of
mineralization. Outcrops show that hydrothermal mineralization is extensive in the area and takes  the
form  of  ferruginous  zones following both bedding and cross-cutting fractures. These  zones  contain
minor  silica  and  pyrite, with traces of copper and zinc, suggesting prospectivity for  volcanogenic
massive sulphide deposits in the area. No further work was carried out at Finarwa.

Private Placement

A  private  placement of GBP40,000 was agreed with Stratex International on the 29th August  2009  and
funds were duly received. The Company has also agreed the issue of 5,333,333 warrants to Stratex at an
exercise price of 0.75p, valid for two years.


The impact of the financial crisis has had a major impact on the ability of the company to raise funds
from  the equity market. Consequently the company aims to secure funding from joint venture and option
agreements  and  has  cut  back  the  scale of its exploration temporarily,  resulting  in  the  lower
expenditure figures reported for the half year as compared with last year. There were many signs  that
confidence  has  returned  to  the  Ethiopian exploration sector with  the  launching  of  exploration
activities  by  two AIM-quoted companies in the territory, but sadly the debilitating  effect  of  the
general  financial  situation on the morale of fund managers and individual investors  in  the  United
Kingdom  is still prevalent. The company plans to renew and extend its licences in the next half  year
and seek joint venture funding from local and foreign companies where necessary.

Henry Atkinson, Director, 26 November, 2009.

                                      SHEBA EXPLORATION (UK) PLC
                                FOR THE 6 MONTHS ENDED 31st AUGUST 2009

                                                            6 months ended              6 months ended
                                                                  31.08.09                    31.08.08
                                                                      £                           £
TURNOVER                                                                 -                          -
Operating Costs                                                      (6123)                    (15825)
Administrative Expenses                                             (40192)                    (39991)
LOSS ON ORDINARY ACTIVITIES                                                                           
BEFORE TAXATION                                                     (46315)                    (55816)
Taxation                                                                  -                          -
                                                                   ________                   ________
RETAINED LOSS FOR THE PERIOD                                        (46315)                    (55816)
                                                                   ________                   ________
(LOSS) PER .75P ORDINARY SHARE                                     (0.052p)                   (0.066p)
(LOSS) PER .75P ORDINARY SHARE                                     (0.041p)                   (0.052p)

The Company made no recognised gains or losses other than those shown above. All results to continuing

The Directors of Sheba Exploration (UK) Plc are responsible for the contents of this announcement.

Contact Details:
Sheba Exploration (UK) Plc
Richard Brooker                                               Tel: 00 353 87699 8401

St Helens Capital Partners LLP                                Tel: 020 7368 6959
Mark Anwyl or Duncan Vasey

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