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AIM and ASX-listed Albidon is taking the Chirundu Uranium JV with African Energy Resources to bankable feasibility stage after the pre-feasibility study delivered promising results.

Author: Tessa Kruger
Posted:  Wednesday , 09 Jul 2008

JOHANNESBURG – Albidon, an ASX (ALB) and AIM listed company (ALD) with its flagship Munali nickel project in production in Zambia, is taking the Chirundu Uranium JV with African Energy Resources (AFR) in Zambia forward as the prefeasibility study delivered some promising results. 

Albidon announced today it will retain its 30% interest in the Chirundu Uranium JV and fund its US$2m share of a bankable feasibility study to eventually develop the project to production.   

This decision comes after AFR completed a prefeasibility study on the project in May that indicated that commercially viable mining of uranium was possible at an uranium price of $65/lb of uranium. 

The prefeasibility study found the project could produce 1.3mlb of uranium over a life of five to six years through open pit mining. Pre-production costs would total $68m, while additional cost of $21m would be deferred as the project’s second deposit, Gwabe, only starts production three years after its Njame deposit.  

Albidon said the project is expected to deliver an “acceptable return” based on estimated operating costs between $30 to $40/lb of uranium and the assumed price of $65/lb of uranium.   

AFR has estimated inferred and indicated resources at the Njame and Gwabe deposits at 14m tonnes with 9.5mlbs contained uranium after the company did extensive drilling at the end of 2007. 

The resource will be upgraded to the measured and indicated category as part of the feasibility study in third quarter next year, Albidon said in a statement.  

The Chirundu joint venture has already started marketing discussions with interested parties for uranium sales contracts.

In addition to the Chirundu JV, Albidon owns 100% interest in the nearby Kariba Valley and Luano Valley joint ventures with the understanding that AFR can earn a 30% interest by sole-funding exploration programmes on a number of uranium prospects.  

According to Albidon’s website the company and African Energy Resources, a specialist energy exploration company, 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.

Albidon’s uranium prospects comprise a number of occurrences of mineralisation within sediments of the Karoo Basin. The prospects were identified during uranium exploration of the Kariba Valley in the 1970’s and early 1980’s.

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