19th Feb 2007 07:00
Albidon Limited19 February 2007 Level 1 62 Colin St West Perth 6005 Western Australia ARBN 107 288 755ALBIDON LIMITED Tel:x+61x8x9211 4600 Fax:x +61x8x9211 4699 Email: [email protected] ASX Code: ALB AIM Code: ALD KEY INFRASTRUCTURE AND EQUIPMENT CONTRACTS SIGNED FOR MUNALI NICKEL PROJECT HIGHLIGHTS Contracts have been finalised for the supply of key components of infrastructureand process plant for the Munali Nickel Project, as follows: • A ten year Power Supply Agreement has been signed between Albidon and ZESCO Limited. • Albidon has placed an order with CITIC Heavy Machinery Company Ltd for the manufacture and supply of two ball mills for the Munali nickel concentrator. • Signing of the power and mill contracts marks an important milestone for the Munali Project, as these items have the longest lead-times for delivery, and securing them will help to ensure the project development schedule is met. Munali Nickel Project The Munali Nickel Project (100% Albidon) is located approximately 60 kilometressouth of Zambia's capital city Lusaka. The Project area comprises the EnterpriseDeposit and a number of other nickel prospects in the Munali Intrusion, the mostadvanced of which is the Voyager prospect along strike to the north ofEnterprise. A positive Bankable Feasibility Study ("BFS") was completed in July 2006 andsite works commenced in September 2006 following Government approvals. A capitalraising was completed in October 2006 to provide US$35 million of equity financefor the project, and negotiation of up to US$80 million of senior andsubordinated debt facilities is well advanced. A life-of-mine offtake agreementwas recently signed with the Jinchuan Group of China. ZESCO Power Supply Agreement A Power Supply Agreement has been signed between Albidon and ZESCO Limited ("ZESCO") to cover the total power requirements of the Munali Nickel Project for aten-year period. ZESCO will construct a 25km long 33kV powerline from the nearbyKafue Town substation which will be the main supply point. This line will supplydual 10MVA 33/11kV substations at the mine site. ZESCO intends to conduct the construction work utilising an EPC contractor to beselected through an international bidding process. ZESCO Limited is the largest electricity supply company in Zambia and hasextensive experience of developing infrastructure and supplying power to miningprojects across the country. Order of Ball Mills for the Munali Nickel Concentrator Albidon has placed an order with CITIC Heavy Machinery Company Ltd ("CITIC") forthe manufacture and supply of two 3.6m x 6.0m, 1,250kW ball mills. The millswill be built to a CITIC standard design and will comply with specificationsdeveloped on Albidon's behalf by Roche Mining. After-sales support, technical assistance, spare parts, maintenance andoperational support will be provided by a CITIC representative group inAustralia and their alliance partner based in Johannesburg, South Africa. CITIC is based in Louyang, China and is one of the largest manufacturers ofgrinding mills in the world, with a strong track record of design and deliveryof high quality milling and ancillary equipment. The group supplies mills tomost of the major mill engineering companies worldwide and has previouslysupplied mills to base metal projects in Zambia. Albidon's offtake partner at Munali, Jinchuan Group Limited, has a strongbusiness relationship with CITIC and it is expected that this will facilitatethe delivery and commissioning of the grinding mills. Albidon is pleased to confirm that both the delivery time and costs for thesemills are the same as or better than the assumptions used in the Munali BFS. Forward Programme for Munali The implementation of the Project will continue to accelerate, with a focus onthe following key areas of activity: • Site preparation including construction of the camp, mobilisation of the mining fleet, development of the underground decline and construction of access roads. • Placing orders for other major items of plant and equipment. • Invitation of tenders for construction of the Munali Project. • Ongoing step-out drilling at the Enterprise and Voyager deposits aimed at expanding the resource base. • Ongoing recruitment of senior technical and commercial management for the Project. Initial concentrate production and subsequent Project ramp-up is targeted formid-2008. If you have any queries, please contact the Company Secretary, Nicholas Day orManaging Director, Dale Rogers on +61 8 9211 4600 or email [email protected] information may also be viewed on Albidon's website atwww.albidon.com. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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