Go Back Email this Link to a friend


Resource Generation Limited - Quarterly Report For The Three Months Ended 30 September 2013

Release Date: 28/10/2013 11:45:00      Code(s): RSG     
                            
Resource Generation Limited
Registered in Australia under the Corporations Act, 2001 (Cth) with
registration number ACN: 059 950 337
ISIN: AU000000RES1
Share Code on the ASX: RES
Share Code on the JSE: RSG
("Resgen" or the ?Company?)


                                 Quarterly Report
                  for the three months ended 30 September 2013

 Resource Generation is developing its Boikarabelo coal mine in the Waterberg region
 of South Africa, which accounts for 40% of the country?s remaining coal resources.
 There are probable reserves of 744.8* million tonnes of coal on 35% of the tenements
 under the company?s control. Stage 1 of the mine development targets saleable coal
 production of 6 million tonnes per annum.


PRESENT STATUS
Finance
- Public Investment Corporation SOC Limited (one of Africa?s largest investment
    managers, owned by the South African Government and managing assets of over
    ZAR1.4 trillion (A$150 billion), Barsington Ltd (a subsidiary of Noble Group) and
    Shinto Torii Inc (a subsidiary of Altius Investment Holdings (Pty) Limited) and a
    number of domestic and international investors acquired 237.2 million shares at 22 cents
    per share after the end of the quarter, completing the 1-for-1 entitlement offer that raised
    a total of $62.6 million.
- Following this placement, Public Investment Corporation?s shareholding in Resource
    Generation is 19.90%, Barsington?s is 17.97% and Shinto Torii?s is 10.91%.
- Two pathways are being undertaken to debt fund both the infrastructure and equipment,
    including negotiations with 11 project finance banks.
- Tenders have been received and evaluated for the supply of mobile equipment and
    materials handling equipment for the coal handling and preparation plant (CHPP) and
    the entire CHPP. Funding is being negotiated with the suppliers.

Physical Progress
- Construction of Boikarabelo?s mine infrastructure has continued.
- Preparatory construction of the 40 kilometre rail link began during the quarter.
- Social and labour plan projects in the local communities have begun to be implemented.

Timetable
? Construction is expected to take two years and, subject to agreements on funding,
   production is expected to begin in late 2015.
? All regulatory hurdles have been overcome, all necessary land has been acquired, and the
   company has rail haulage and port access contracts sufficient for Boikarabelo?s stage 1
   production.

Offtake Contracts
- Three long-term export offtake contracts have been entered into with CESC, Valu
    Investments and Noble Group. These contracts underwrite most of the forecast revenue
    from Boikarabelo?s stage 1 production and a substantial portion of stage 2 production.
- A domestic offtake contract for 3.0 million tonnes per annum of middlings coal has been
    entered into with Noble Group for the first eight years of production.
Resource Generation Limited
Quarterly Report to 30 September 2013



Proposed Power Stations
- Valu has commenced feasibility studies for the proposed development of a 200 MW
   power station and a larger 1200 MW coal-fired power station adjacent to the Boikarabelo
   mine.

PROGRESS DURING THE QUARTER

Debt Finance
Negotiations continued with 11 banks who received data room access and are undertaking
due diligence. Progress is expected towards achieving final term sheets and credit approval
over the next quarter.

The main focus during the quarter was on arranging alternative sources of funding. The
majority of tenders received, for mobile equipment, materials handling for the CHPP, and the
entire CHPP, had funding support. Technical assessments of the various tenders have been
completed and negotiations are continuing on the funding support. Such funding is complex
and is targeted for completion over the next few months.

Operational Activities
The bulk of the company?s South African employees have relocated to an interim office at
the mine site and are installing the mine?s safety and operational procedures for the
construction contractors? compliance. Land clearing for the development of the construction
camp has been completed. Earthworks and construction of the initial camp for construction
of the rail link, which will house 200 people, have begun.


Land clearing for the 40 kilometre rail link has also commenced. Projects to commence
shortly will be a provincial road bypass, the main mine access road and upgrading of the
current access road.

Social & Labour Plan Activities
The mining right for Boikarabelo requires implementation of the social and labour plan
approved by the Department of Mineral Resources. Activities to comply have commenced in
earnest, including the award of bursaries to university students, sponsorship of apprenticeship
(artisan) training, adult basic education and training classes for local villagers, and upgrading
the local village?s meeting hall.

Work also continued on community consultation, mapping of the local village, a skills
database and expansion of the database of small, medium and micro enterprises. The initial
phase of the mine recruitment process was completed, with the receipt of 11,390 CVs.

CORPORATE
- Cash reserves at 30 September 2013 were $27.3 million. Following the end of the
  quarter, the balance of the 1 for 1 entitlement offer was successfully placed, raising a
  further $52.2 million. The shares were mainly placed with strategic shareholders, being
  Public Investment Corporation SOC Limited (PIC ), Barsington Ltd (a subsidiary of the
  Noble Group) and Shinto Torii Inc (a subsidiary of Altius Investment Holdings (Pty)
  Limited). PIC is one of the largest investment managers in Africa, managing assets of
  over ZAR1.4 trillion (A$150 billion). It is a registered financial services provider wholly
  owned by the South African Government.

CORPORATE INFORMATION

Directors
Brian Warner                           Non-Executive Chairman
Paul Jury                              Managing Director
Steve Matthews                         Executive Director
Geoffrey (Toby) Rose                   Non-Executive Director

Company Secretary
Steve Matthews

Registered Office
Level 12, Chifley Tower
2 Chifley Square
Sydney NSW 2000

Telephone:         02 9376 9000
Facsimile:         02 9376 9013
Website:           www.resgen.com.au

Mailing Address
GPO Box 5490
Sydney NSW 2001

Contacts
Paul Jury
Steve Matthews

Media
Anthony Tregoning, FCR on (02) 8264 1000

* Information in this report that relates to exploration results, mineral resources or ore reserves is based on information
compiled by Mr Dawie Van Wyk who is a consultant to the Company and is a member of a Recognised Overseas
Professional Organisation. Mr Van Wyk has sufficient experience which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the
2004 Edition of the ?Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves?. Mr Van
Wyk has given and has not withdrawn consents to the inclusion in the report of the matters based on his information in the
form and context in which it appears.

                                                     



                                                          Appendix 5B

                            Mining exploration entity quarterly report
  Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.



  Name of entity
  Resource Generation Limited

  ABN                                                                     Quarter ended (?current quarter?)
  91 059 950 337                                                           30 September 2013


  Consolidated statement of cash flows
                                                                          Current quarter      Year to date (3 mths)
Cash flows related to operating activities                                $A?000                   $A?000

1.1       Receipts from product sales and related debtors                               -                            -

1.2       Payments for       (a) exploration and evaluation                           (40)                        (40)
                             (b) development                                       (3,937)                     (3,937)
                             (c) production                                             -                           -
                             (d) administration                                      (791)                       (791)
1.3       Dividends received                                                            -                           -
1.4       Interest and other items of a similar nature received                       283                         283
1.5       Interest and other costs of finance paid                                     (2)                         (2)
1.6       Income taxes paid                                                             -                           -
1.7       Other (provide details if material)                                           -                           -
          Net Operating Cash Flows                                                 (4,487)                      (4,487)

          Cash flows related to investing activities
1.8       Payment for purchases of: (a) prospects                                       -                            -
                                     (b) equity investments                             -                            -
                                     (c) other fixed assets                             -                            -
1.12      Proceeds from sale of:     (a) prospects                                      -                            -
                                     (b) equity investment                              -                            -
                                         (subsidiary)                                   -                            -
                                     (c) other fixed assets                             -                            -

1.10      Loans to other entities                                                       -                            -
1.11      Loans repaid by other entities                                                -                            -
1.12      Other- Government charges in relation to land                                 -                            -
          acquisitions,    borrowings    and development
          expenditure (refundable)
                                                                                        -                            -
          Net investing cash flows


1.13      Total operating and investing cash flows (carried
                                                                                   (4,487)                     (4,487)
          forward)




                                                                   

                                                                    Current quarter   Year to date (3 mths)
                                                                       $A?000                $A?000
 1.13      Total operating and investing cash flows (brought
                                                                            (4,487)                   (4,487)
           forward)
           Cash flows related to financing activities
 1.14      Proceeds from issues of shares, options, etc.                     10,420                   10,420
 1.15      Proceeds from sale of forfeited shares                                 -                        -
 1.16      Proceeds from borrowings                                               -                        -
 1.17      Repayment of borrowings                                                -                        -
 1.18      Dividends paid                                                         -                        -
 1.19      Other (BEE Loan)                                                    (53)                     (53)
 1.19      Other (Mining Related Deposits)                                        -                        -
 1.19      Other (Cost of Borrowings)                                             -                        -

           Net financing cash flows                                          10,367                   10,367

           Net increase (decrease) in cash held                               5,880                     5,880

 1.20      Cash at beginning of quarter/year to date                         21,428                   21,428
 1.21      Exchange rate adjustments to item 1.20                              (27)                     (27)
 1.22      Cash at end of quarter                                            27,281                   27,281

Payments to directors of the entity and associates of the directors
Payments to related entities of the entity and associates of the related entities
                                                                                           Current quarter
                                                                                              $A'000
 1.23       Aggregate amount of payments to the parties included in item 1.2                              271

 1.24       Aggregate amount of loans to the parties included in item 1.10                                    -

 1.25       Explanation necessary for an understanding of the transactions
            Executive salaries and directors fees

Non-cash financing and investing activities
 2.1       Details of financing and investing transactions which have had a material effect on consolidated
           assets and liabilities but did not involve cash flows
           N/A

 2.2       Details of outlays made by other entities to establish or increase their share in projects in which
           the reporting entity has an interest
           N/A

Financing facilities available
Add notes as necessary for an understanding of the position.
On 28 June 2013, the company converted US$51.3 million of its US$123 million loan facility agreement with
Noble into a dedicated rail link loan facility. An A$20 million secured debenture was issued to Noble in
January 2013. The debenture is repayable in December 2013.
                                                                 Amount available         Amount used
                                                                      $A?000                 $A?000
 3.1       Loan facilities                                                      137,974               20,000

 3.2       Credit standby arrangements                                                 -                      -


                                                    


    Estimated cash outflows for next quarter
                                                                                                   $A?000
   4.1    Exploration and evaluation                                                                 (163)

   4.2    Development                                                                              (3,812)
   4.3    Production                                                                                       -
   4.4    Administration                                                                           (3,364)

          Total                                                                                    (7,339)



Reconciliation of cash
    Reconciliation of cash at the end of the quarter (as       Current quarter         Previous quarter
    shown in the consolidated statement of cash flows) to         $A?000                   $A?000
    the related items in the accounts is as follows.
    5.1   Cash on hand and at bank                                               51                       82

    5.2   Deposits at call                                                   27,230                21,436

    5.3   Bank overdraft                                                          -                        -

    5.4   Other (Bank guarantees)                                                 -                        -

          Total: cash at end of quarter (item 1.22)                          27,281                21,428




Changes in interests in mining tenements

                              Tenement reference        Nature of interest        Interest at   Interest at
                                                                                 beginning of     end of
                                                                                   quarter       quarter
   6.1    Interests in                       N/A                         N/A              N/A          N/A
          mining tenements
          relinquished,
          reduced or lapsed

    6.2   Interests in                       N/A                         N/A             N/A          N/A
          mining tenements
          acquired or
          increased




                                                   


Issued and quoted securities at end of current quarter
Description includes rate of interest and any redemption or conversion rights together with prices and dates.


                                          Total number        Number              Issue price per     Amount paid
                                                              quoted                     security    up per security
                                                                                              ($)                ($)
 7.1       +Preference                                N/A
            securities (description)
 7.2       Changes during quarter                     N/A
           (a) Increases through
               issues
           (b) Decreases
               through returns of
               capital, buy-backs,
               redemptions
 7.3       +Ordinary securities              332,234,604         332,234,604             Various           Fully paid

 7.4       Changes during quarter
           (a) Increases                      47,536,602          47,536,602                $0.22          Fully paid
               through issues

           (b) Decreases                               Nil
               through returns of
               capital, buy-backs
 7.5       +Convertible   debt                        N/A
           securities (description)
 7.6       Changes during quarter                     N/A
           (a) Increases through
               issues
           (b) Decreases through
                securities matured,
                converted
  7.7      Options (description                                                   Exercise price         Expiry date
           and conversion factor)               1,875,000                  Nil           $0.50            13/3/2014

 7.8       Issued during quarter                      Nil
 7.9       Exercised during quarter                   Nil
 7.10      Expired during quarter               1,875,000                  Nil             $0.50            7/7/2013

 7.11      Debentures                                 N/A
           (totals only)
 7.12      Unsecured notes (totals                    N/A
           only)




                                                    



Compliance statement

1      This statement has been prepared under accounting policies which comply with
accounting standards as defined in the Corporations Act or other standards acceptable to ASX
(see note 5).

2       This statement does give a true and fair view of the matters disclosed.



Sign here:                                            Date: 28 October 2013
                (Company secretary)

Print name:     STEPHEN JAMES MATTHEWS


Notes

1        The quarterly report provides a basis for informing the market how the entity?s
activities have been financed for the past quarter and the effect on its cash position. An entity
wanting to disclose additional information is encouraged to do so, in a note or notes attached
to this report.

2       The ?Nature of interest? (items 6.1 and 6.2) includes options in respect of interests in
mining tenements acquired, exercised or lapsed during the reporting period. If the entity is
involved in a joint venture agreement and there are conditions precedent which will change
its percentage interest in a mining tenement, it should disclose the change of percentage
interest and conditions precedent in the list required for items 6.1 and 6.2.

3      Issued and quoted securities The issue price and amount paid up is not required in
items 7.1 and 7.3 for fully paid securities.

4     The definitions in, and provisions of, AASB 6: Exploration for and Evaluation of
Mineral Resources and AASB 107: Statement of Cash Flows apply to this report.

5       Accounting Standards ASX will accept, for example, the use of International
Financial Reporting Standards for foreign entities. If the standards used do not address a
topic, the Australian standard on that topic (if any) must be complied with.

Sydney
28 October 2013

JSE Sponsor:
Macquarie First South Capital Proprietary Limited
                                  
Date: 28/10/2013 11:45:00 Supplied by www.sharenet.co.za                     
Produced by the JSE SENS Department                             . The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
 the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, 
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
 information disseminated through SENS.


                                        
Email this JSE Sens Item to a Friend.

Send e-mail to
© 2017 SHARENET (PTY) Ltd, Cape Town, South Africa
Home     Terms & conditions    Privacy Policy
    Security Notice    Contact Details
Market Statistics are calculated by Sharenet and are therefore not the official JSE Market Statistics. The calculation/derivation may include underlying JSE data.