Albion Resources to go ahead with loyalty option plan as reward to initial shareholders

Albion Resources (ASX: ALB) is currently drafting a loyalty options prospectus to reward shareholders who backed its initial public offering earlier this year.

The zinc and lead exploration company made its ASX debut on 30 April after raising $5 million, but its prospectus left open the decision whether loyalty options would proceed.

The company’s first quarterly report has now confirmed that the options plan will go ahead.

In its IPO prospectus, Albion indicated the record date was expected to be within three months of its ASX admission, suggesting that it will be set at 30 July.

It was proposed that, for a nominal issue price per option, one such loyalty option would be granted for every two shares, exercisable at $0.25 within two years.

A busy two months after listing

Albion’s zinc-lead Lennard Shelf project is located in the Mississippi Valley-type (MVT) province about 30km southeast of Fitzroy Crossing in Western Australia.

MVT lead-zinc deposits are found throughout the world but the largest occur in North America. The ores consist mainly of sphalerite, galena and iron sulphides — and they frequently contain silver.

The WA area has also hosted significant historic mines, including Pillara and Cadjebut.

In the two months to  30 June, Albion reviewed historical data at the Pillara East prospect, which included grades up to 27.5% zinc, 36% lead and 3.66% copper.

A reconnaissance team reported visible galena (the principal ore of lead) and hydrozincite (a white mineral containing zinc) were discovered 350m north of an historical drill hole which is recorded as returning 4.6m at 5% zinc and 30.5% lead from 54m down hole.

In addition, the site visit team identified exposed mineralisation of more than 500m in length at the Prices Hill prospect.

Since then, the company has signed Native Title, heritage protection and mineral exploration agreements with traditional landholders and the Gooniyandi Aboriginal Corporation.

Nickel-copper tenement granted

During the June quarter, Albion was granted tenement E36/1005 located about 30km from the town of Leinster in Western Australia.

The company said recent drilling success by neighbour Auroch Minerals (ASX: AOU) at several nearby nickel-copper prospects had produced geophysical imagery indicating that those ultramafic rocks extend into Albion’s tenement.

Albion chairman Colin Locke said the company had made great progress since its listing in “unlocking the significant value potential of the Lennard Shelf project”.

“We are keen to get on with the job and drill our highly promising prospects at Pillara East as soon as possible,” he added.