24th Jan 2007 07:00
Albidon Limited24 January 2007 Level 1ALBIDON LIMITED 62 Colin St West Perth 6005 Western Australia ARBN 107 288 755 Tel: +61 8 9211 4600 Fax: +61 8 9211 4699 Email:[email protected] ASX Code: ALB AIM Code: ALD Follow the link below to view the full release:http://www.rns-pdf.londonstockexchange.com/rns/0435q_-2007-1-24.pdf AGREEMENT WITH ZINIFEX FOR EXPLORATION OF ALBIDON'S ZINC PROJECTS IN TUNISIA HIGHLIGHTS • Option and Earn-In Letter Agreement signed with Zinifex Limited for exploration and development of Albidon's zinc projects in Tunisia. • Minimum initial commitment of US$1.3 million, to be expended within 12 months. • Cash payments to Albidon totalling US$1 million to be made in stages, with an initial payment of US$250,000. • Zinifex to spend US$6 million to earn a 51% interest within 3 years, and thereafter may earn a total of 70% interest by expenditure of an additional US$5 million within 2 years. • The Agreement with Zinifex provides Albidon with access to specialist zinc exploration and development expertise which will add substantial value to the Company's large ground holdings in northern Tunisia. • Albidon is focused on maximizing shareholder value from the Munali Nickel Project in Zambia and other East African nickel projects. This agreement with Zinifex and other Joint Venture arrangements with Lonmin, BHP Billiton and Energy Ventures provide a mechanism to further grow value from Albidon's carefully selected African tenement holdings. Albidon's Projects in Tunisia Albidon holds extensive tenement interests prospective for zinc and lead innorth-central Tunisia. The projects cover an area of over 4,000 squarekilometres and include the historical zinc mining district of Bou Aouane at theNefza project area (see diagram 1 in the hyperlink above) in the north west ofthe country. Exploration completed by Albidon in the past two years hasidentified the potential for large zinc deposits such as those found at Reocinin Spain and Jinding in China. In addition to numerous zinc prospects, the Nefza tenement also contains severalcopper-gold targets, including the Kef El Agueb gold results, and the Oued Belifcopper-gold breccia complex. Zinifex's initial focus will be on the zinc-leadprojects, however the copper-gold opportunities will be reviewed on an ongoingbasis. Option and Earn-In Agreement The Agreement between Albidon and Zinifex' is designed to accelerate theevaluation of the Company's Tunisian projects, taking advantage of Zinifex'considerable expertise in zinc exploration and development. The key terms of the Agreement are: • Staged cash payments to Albidon of US$1 million, with an immediate initial payment of US$250,000. • Minimum commitment of US$1.3 million of expenditure by Zinifex. This exploration to be completed within 12 months. • Zinifex may earn a 51% interest in the projects by spending a total of US$6 million on exploration within 3 years, and making a further cash payment of US$750,000. No interest will be earned by Zinifex in the projects until this time. The minimum initial committed expenditure of US$1.3 million is credited towards the earn-in, however the cash payments of US$1 million are not included as project expenditures. • Zinifex to spend an additional US$5 million within 2 years to earn a total interest of 70%. • Thereafter Albidon may elect to contribute to project expenditures in proportion to its 30% interest or may sell its interest for cash plus a retained royalty. Zinifex will manage the exploration programmes, taking advantage of theextensive database, local exploration infrastructure, personnel and supportnetwork established by Albidon. Signing of the Agreement marks the completion of an extensive series ofnegotiations, following receipt of a number of competitive proposals from largezinc mining companies. The arrangement with Zinifex will result in acceleratedexploration of Albidon's zinc assets and importantly it enables the Company tofocus on its prime objective of developing the Munali Nickel Project in Zambia. About Zinifex Zinifex owns and operates mining and mineral processing operations in Australia,Europe and USA. Current production exceeds 600,000 tonnes of zinc inconcentrates and 600,000 tonnes of refined zinc metal annually. The companysells a range of zinc metal, lead metal and associated alloys in over 20countries. Zinifex recently merged its metal processing business with that of Umicore tocreate the world's largest producer of finished zinc metal and related productswith a market capitalisation of over A$8.2 billion. The company is now pursuingan aggressive growth strategy and has committed US$65 million to explorationover the next 3 years. See Zinifex's website (www.zinifex.com) for furtherinformation. Albidon is pleased to be joined by such a well credentialed partner in theexploration of its zinc-lead projects in Tunisia. Forward Programme for Tunisia A systematic exploration program has already commenced, with the followingpriority objectives: • Orientation ground geophysical surveys over zinc-mineralised areas at several prospects. • Regional-scale stream sediment and soil sampling along major fault structures at Nefza. • Geological mapping and evaluation of the known zinc prospects. • Compilation of archival data on previous zinc mining and resources in the Bou Aouane district, and definition of targets for drill testing. 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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