EVE Joint Venture Partner ALB's Announcement re Uranium...

EVE Joint Venture Partner ALB's Announcement re Uranium Exploration Agreement as follows:

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via electronic lodgement
Exploration Agreement on Albidon’s Uranium Prospects
OVERVIEW
• Albidon Limited and Energy Ventures Limited (EVE) have entered into an
agreement for the exploration and development of a number of uranium and
coal prospects that have been identified on Albidon’s tenements in Zambia.
• Under the Agreement major exploration programs will commence immediately
with A$500,000 to be spent by EVE within two years to maintain an option to
enter a Joint Venture on one or more project areas.
• Following these programmes EVE may earn a 30% interest in each project area
selected by it for farm-in by expending A$1 million on the selected project area,
and may then proceed to earn a 70% interest by drilling up a JORC Indicated
Resource and completing a Prefeasibility Study.
• The Agreement enables Albidon to remain focused on developing its nickel
projects in southern Africa while adding value to its tenements through the
funding and expertise provided by a specialist energy exploration company.
BACKGROUND
Albidon is principally engaged in the exploration and development of nickel projects in
southern Africa. These projects are located within the Company’s large tenement portfolio
that spans the countries of Zambia, Botswana, Tanzania and Malawi. Whilst these
licences were taken up on the basis of their nickel potential, a recent review of the
prospectivity of the tenements for other metals indicates there is potential for discovery of
uranium in a portion of Albidon’s extensive land holdings in Zambia.
Albidon’s uranium prospects comprise a number of occurrences of mineralisation within
sediments of the Karoo Basin which is the host sequence for several uranium deposits in
southern Africa. The prospects were identified during uranium exploration of the Kariba
Valley in the 1970’s and 1980’s however documentation is sparse and there has been no
follow up exploration the past 20 years.
The areas of interest for uranium and other energy minerals are adjacent to but
geologically separate from those that are the focus of Albidon’s ongoing nickel exploration
activities (refer to attached Map).
The Company has decided to farm out these uranium prospects to a specialist, Africafocused
energy exploration company upon terms considered attractive for Albidon. This
approach has the benefit of bringing focussed exploration activity to the early stage
uranium prospects whilst not diverting funds or management resources from Albidon’s
nickel activities.
ENERGY VENTURES LIMITED
Energy Ventures Limited is an ASX-listed company specialising in the exploration of
uranium, coal and coal-bed methane projects in Mozambique, Zambia, Botswana,
Zimbabwe and Malawi. The company is run by experienced Africa-based exploration
management and chaired by Dr Ian Duncan who, through a number of previously held
senior management positions at WMC’s Olympic Dam Operations, has extensive
experience of all technical and commercial aspects of the development of energy
minerals projects.
DETAILS OF THE AGREEMENT
• EVE must expend a minimum of A$500,000 on exploration of the specified projects
during an Evaluation Phase that expires in two years.
• This expenditure will secure for EVE the exclusive right to enter farm-in agreements
on one or more projects under pre-agreed terms as set out below.
• EVE may select the areas it wishes to farm-into within two years. Each project area
selected requires a separate farm-in agreement. The following terms apply to each
farm-in agreement:
�� EVE must expend at least A$300,000 per annum.
�� EVE may sole-fund A$1 million of project expenditure to earn a 30% interest in
the project. EVE’s expenditure during the Evaluation Phase on the areas the
subject of the farm-in will be credited towards this.
�� EVE may earn a 70% project interest by sole-funding exploration and
development expenditure by drilling up an Indicated Mineral Resource as defined
in the JORC Code and completing a Prefeasibility Study.
�� Thereafter Albidon may elect to contribute 30% of project funding.
�� In the event Albidon elects not to participate at a 30% interest, EVE’s interest will
increase to 80% in return for committing to a Bankable Feasibility Study and solefunding
the first A$10 million of the study.
�� Albidon may then elect to fund its 20% share of further project costs; or may
require EVE to fund Albidon’s share of project costs in return for an additional 5%
interest (leaving Albidon with 15% carried into production); or alternatively Albidon
may elect to convert its interest to an agreed Net Smelter Return (‘NSR’) (for
example 1 to 3% sliding scale in the case of uranium).
DISCLOSURE
Three of Albidon’s directors have a declared interest in EVE. These directors have not
been involved in the negotiations with EVE. All discussions between Albidon and EVE
have been conducted by the Company’s independent directors acting under external
legal and technical guidance in accordance with the highest standards of corporate
governance.
The Company is looking forward to working closely with EVE to realise the discovery
potential for uranium on these projects.
If you have any queries please contact the Chief Financial Officer, Nicholas Day on +61 8
9389 6300. Additional information may also be viewed on Albidon’s website at
www.albidon.com

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