Joint Ventures
Uranium
Albidon and African Energy Resources 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. This agreement enables Albidon to remain focused on developing its nickel projects in southern Africa while adding value to its uranium prospects through the funding and expertise provided by a specialist energy exploration company.
- Under the Agreement A$500,000 must be spent by African Energy within two years to maintain an option to enter a Joint Venture on one or more project areas. This milestone has been met.
- African Energy has, to date, nominated two projects for farm-in, the Chirundu JV and the Kariba Valley JV.
- African Energy has earned a 30% interest in the Chirundu JV and may now earn a 30% interest in the Kariba Valley JV by expending A$1 million on the latter project, African Energy may then proceed to earn a 70% interest by drilling up a JORC Indicated Resource and completing a Pre-Feasibility Study on each JV.
- The Board of African Energy has approved a Pre-Feasibility Study to evaluate the commercial development of uranium mineralisation at the Njame deposit and the newly discovered Gwabe prospect in the Chirundu JF, scheduled for completion by the end of 2008.
- The Njame North deposit at Chirundu contains an Inferred Tesource ("JORC") of 5.5Mt @ 400ppm U3O8 (4.8Mlb U3O8). Njame North remains open in several directions and further drilling is planned.
- An airborne radiometric survey conducted in late 2006 led to the identification of several high priority uranium anomalies for follow up in the Kariba, Chirundu and Luano project areas and follow up fieldwork is ongoing in a number of these areas.
Background
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 early 1980’s. During this time a large number of sandstone-hosted uranium prospects identified by ground radiometric surveying were mapped and sampled, with limited drilling.
Drilling Update
African Energy Resources commenced drilling of the Njame uranium prospects within the Albidon joint venture areas in May 2006. The objective was to define a JORC-reportable resource by confirming previously recorded drill intersections and utilizing state of the art geochemical assaying rather than gamma logging techniques in resource estimation.
African Energy’s drilling program successfully identified a mineral resource at Njame North, where two layers of near-surface sandstone-type uranium mineralisation have been confirmed. An Inferred Resource of 5.5Mt @ 400 ppm U3O8 for 2,200 tonnes U3O8 (with a cut-off grade of 200ppm U3O8) has been estimated for Njame North and verified by independent consultants RSG Global. In late 2006 a small programme of diamond drilling was completed at Njame North to provide samples for metallurgical variability studies established.
The mineralisation at Njame occurs in a similar geological setting to the nearby Dibwe and Mutanga deposits. These are currently being evaluated for development by Denison Mines following its takeover of previous owner OmegaCorp Limited in 2006.
Pre-Feasibility Study
The decision to proceed by African Energy to proceed with a Pre-Feasibility Study follows a Scoping Study on the current reported resource at Njame and recently drilled mineralisation at Gwabe. The Scoping Study demonstrated the potential for an economically viable project using proven technology and benchmarked costs.
The Pre-Feasibility Study has commenced and is expected to be completed by the end of December 2007. The forecast cost of the Pre-Feasibility Study is A$1.5 million, which includes metallurgical testwork, engineering and drilling to upgrade the resource status.
Airborne Radiometric Survey
In November 2006, a detailed airborne radiometric survey was completed over the Njame Prospect to provide orientation data for future surveys. Following this orientation, the airborne survey was extended to the east of Njame, covering areas not previously known to have been evaluated with radiometric surveying, and two small blocks in the Kariba Valley JV were also surveyed. Several hitherto unknown uranium anomalies have been identified by these surveys. These new anomalies, and untested ground radiometric anomalies identified in the 1970’s will be subject to ground evaluation and drill testing in 2007.
