Albidon progresses on nickel and zinc while partner company outlines uranium anomaliesadmin
Albidon Ltd listed on both AIM and the ASX in March 2004 with a view to developing its portfolio of nickel-platinum projects in Southern Africa. The ticker symbol is ALD on AIM and ALB on the ASX; market capitalisation is approximately £109 million or US$215 million. The company states that its strategy is threefold: to develop the Munali Nickel deposit in Zambia; to undertake exploration in ”brownfield” areas around the Selebi-Phikwe nickel mining district in Botswana; and to evaluate the potential of its large holdings of early-stage exploration projects in eastern and southern Africa.
The latest development, therefore, may augment the company’s nickel interest in a slightly different direction following the identification of uranium anomalies after a series of airborne surveys in Zambia. The projects are under joint venture between Albidon Ltd and Energy Ventures Ltd over Albidon tenements. African Energy Resources Limited, which is 79% controlled by Energy Ventures, has completed airborne surveys over five project areas, totalling 8,664 line-kilometres and cover approximately 4,500 square kilometres. These surveys have identified a total of 15 uranium anomalies. These anomalies lie along strike from the Njame North prospect, where African Energy has previously announced a JORC inferred resource of 5.5 million tonnes, at 400 parts per million U3O8.
On the African Energy Projects, in which Albidon has 100% equity, six anomalies have been identified at the southern end of the North Luangwa Valley Project, with a further two identified at the north end of the project. The survey over North Luangwa covered an area of approximately 1,475 square kilometres, and uranium anomalies of up to 7 ppm have been identified.
In the joint venture projects in which African Energy can earn up to 70% equity from Albidon, two anomalies have been identified at the Chirundu joint venture project and two more in the Luano Valley Project, with three in the Kariba Valley joint venture projects. The Chirundu project covers an area of 540 square kilometres, with the surveys originally flown at 500-metre line spacing. Two major clusters of anomalies were identified, both in areas that are not known to have previously undergone prior exploration for uranium.
These new anomalies, along with seven previously identified anomalies in the Kariba Valley project will be priorities for reconnaissance drill testing, due to commence in early April, subject to seasonal rains.
Meanwhile Albidon has mandated the European Investment Bank and Barclays Capital to act as joint Lead Arrangers in providing finance of up to US$60 million for Munali. This will provide the remaining necessary capital for the development of Munali including construction costs, working capital requirements and will ensure that Albidon retains sufficient funds to continue exploration and business development activities. The financing is subject to the completion of due diligence and detailed documentation, which are expected to be finalised before mid 2007.
Munali is approximately 60 kilometres to the south of Lusaka and comprises the Enterprise deposit plus other nickel prospects in the Munali intrusion. An offtake agreement has been signed with the Jinchuan Group. Initial concentrate production and subsequent ramp up is targeted to commence in mid-2008 and the Enterprise project, one of the few nickel sulphide deposits due to be developed in the next ten years, is designed to produce approximately 8,500 tones per annum of nickel in concentrate from a 900,000 tpa underground mining operation.
Rounding off the company’s latest developments, Albidon has also announced that it has signed an option and earn-in letter with Zinifex Ltd for exploration and development of Albidon’s zinc projects in Tunisia. Albidon hold extensive tenement interests that are prospective for zinc and lead in north-central Tunisia, covering 4,000 square kilometres including the historical zinc mining district of Bou Aouane at the Nefza project area in the north west of the country. Albidon’s exploration programmes over the past two years has identified the potential for large zinc deposits and Albidon is of the view that these deposits could be similar to those at Reocin in Spain. The area also contains several copper-gold targets, although the Zinifex work will concentrate initially on the zinc-lead projects.
Zinifex has expertise in zinc exploration and development and may earn a 51% interest in the projects through the expenditure of US$6 million on exploration within three years. The company may then spend a further SU$5 million within two years to earn a total interest of 70%. Albidon may thereafter elect to contribute to project expenditures in proportion to its 30% interest or sell its interest for cash plus a retained royalty.
Albidon is headed by Chairman Mr Richard Potts, a mining engineer with 37 years’ experience in the minerals industry including South Africa and Zambia and with Rio Tinto, Pasminco and Mount Isa Mines. The Managing Director is Mr Dale Rogers, also a mining engineer, with 20 years’ experience across the base and precious metals and diamond sector, including the nickel properties at Kambalda, Kalgoorlie, Mt Keith mines and the Kalgoorlie smelter operations in Australia (now BHP-Billiton but at that stage under the auspices of WMC), and subsequently on a number of gold mines.