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DJ Albidon To Be Nickel Acquisition Vehicle For Jinchuan CEO
Jul 27,2010 10:36CST
industry news

LONDON, July 27 -- Australian nickel miner Albidon Ltd.'s majority owner, China's state-owned miner Jinchuan Group Co., plans to make Albidon an acquisition vehicle for nickel assets, Albidon's managing director said in an interview.

Jinchuan built a 50.4% stake in Albidon during the financial crisis when low nickel prices and tighter credit markets forced Albidon to suspend development of its Munali nickel project in Zambia, delist from exchanges, and move into

Albidon's now on track to relist on the Australian Stock Exchange in August and reach its annualized capacity of 6,500 metric tons of nickel in concentrate at Munali by September, Alasdair Cooke told Dow Jones Newswires.

Once this is achieved, Albidon plans to use Jinchuan's strong connections with Chinese banks to move quickly and aggressively in acquiring nickel assets in Africa and Australasia that have synergies with Jinchuan, Cooke said. Jinchuan is China's biggest nickel producer, with an annual capacity of 150,000 tons.

"The general intention in Jinchuan is seeking to use Albidon as a vehicle for their offshore activities," Cooke said. "Albidon's maintaining a close watch over any opportunities in African and Australasian regions for nickel assets," he said, adding Albidon's team will "go and find these distressed projects and bring them under the same management."

Cooke said some potential targets are projects owned by companies that Jinchuan has already signed offtake agreements with, or has stakes in.

Jinchuan has offtake agreements with Avebury nickel mine, owned by a subsidiary of Minmetals Resources Ltd.'s (1208.HK), and Asian Mineral Resources Ltd.'s (ASN.V) Ban Phuc Nickel mine in Vietnam.  Both mines were idled during the financial crisis when nickel prices fell sharply and have yet to be restarted.

Cooke said Albidon has not reached the stage in any of its relations or discussions with companies to reach an agreement or make an announcement. "(There is) nothing that can be formalized at the moment."

nickel Ni

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