Gaborone, Botswana — MININGREVIEW.COM — 23 September 2009 – Australian-based nickel miner Albidon Limited is poised to resume exploration under its Selebi- Phikwe prospecting licence in Botswana, after a six-month hiatus caused by the fall in global nickel prices.
Reporting from Gaborone, allAfrica.com said it had emerged that Albidon could soon be back in Botswana, should its shareholders approve a debt settlement and re-capitalisation deal. Albidon shareholders will meet next month to accept or reject a Deed of Company Arrangement (DOCA), through which Chinese company Jinchuan aims to rescue and control the troubled nickel miner.
Albidon collapsed in March, following a slump in world nickel prices, which were among minerals and commodities negatively affected by the global recession. Prior to the recession’s onset, Albidon had been operating the Munali nickel mine in Zambia for less than a year, while prospecting for the same mineral in Botswana, Tanzania and Tunisia.
Outside Zambia, Albidon had hoped to progress the Selebi-Phikwe exploration to resource estimation and further development, using the mine development experience gained at Munali and benefiting from the geological similarities between the countries. Albidon owns 21 prospecting licences covering 11 262 sq km around this area, and had recorded some positive results through a drilling programme covering four nickel prospects.
Jinchuan has offered to acquire Albidon’s secured debt from Barclays Bank and the European Bank, while also shouldering the costs payable to Albidon’s lenders. Albidon would also receive R182.6 million from the issue of its shares and convertible notes to Jinchuan, enabling it to restart Munali and exploration programmes such as those in Botswana.
Prior to Jinchuan’s offer, Albidon was approximately R260 million in secured debts, excluding an outstanding equipment finance facility with Barclays Bank Zambia.
“The shareholders’ meeting is expected to take place within one or two weeks, and settlement under the DOCA is to occur within two business days of shareholder approval, if obtained,” an Albidon board statement said.