Go Back Email this Link to a friend

RESOURCE GENERATION LIMITED - Quarterly Report for the three months ended 30 September 2015

Release Date: 29/10/2015 11:05:00      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
("Resource Generation")

Quarterly Report for the three months ended 30 September 2015

 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 (refer ASX announcement dated 16 December 2010).
 Stage 1 of the mine development targets saleable coal production of 6 million tonnes
 per annum.

Negotiations continued during the quarter with various parties to provide project finance for
the construction of the Boikarabelo mine.

One of these parties was a club of financiers that included Noble Group Limited (Noble).
Together with Altius Investment Holdings (Pty) Limited (Altius), which was the arranger of
the potential debt club funding, Noble proposed alternative financial and operating models in
which Resource Generation?s board identified discrepancies and which the board was not
prepared to accept. Noble also tried to persuade the board to engage its nominated mining
contractor, Mota Engil, without a competitive tender, and to contract an alternative coal
handling and preparation plant designer and builder, despite Resource Generation having
previously signed a contract with FLSmidth. The current status of the debt club is uncertain.

Noble sought board representation which was declined and, subsequently, Altius requisitioned
a general meeting to remove the current board and replace it with its own nominees.

The general meeting will take place on 26 November 2015. The company has submitted an
application to the Takeovers Panel seeking orders that Altius, Noble and Public Investment
Corporation SOC Limited be excluded from voting at the meeting. That application is pending.

Resource Generation has continued to explore alternate debt funding arrangements to complete
construction of the Boikarabelo mine and, the day before Altius requisitioned the meeting,
signed an MOU with a Swiss private company to provide in-principle funding of EUR480
million. Following Altius? actions, the Swiss funder indicated that it reserves the right to cancel
the loan facility if there is a change of directors. Clarity on the current status is being sought.

The company?s cash reserves at 30 September 2015 were $26.2 million.
Boikarabelo mine construction
Construction of initial stages of the mine?s infrastructure continued during the quarter, while
project debt funding was being negotiated. Work occurred on:
       *power supply infrastructure;
       *rail installation at the network stabilisation facility (NSF); and
       *13 kilometres of water pipeline associated with the effluent treatment plant.
EHL Energy (Pty) Limited completed the construction of the substation and switch room after
the end of the quarter and final testing for completion has also occurred. The power supply
infrastructure is funded by a deferred payment facility.
At the NSF, the 26 tonne axle load switch and signalling system was installed and
commissioned at the end of the quarter. 400 metres of rail is being installed in the current
The Marapong effluent treatment facility in Lephalale and the 58 kilometre pipeline to
Boikarabelo are an integral part of the mine?s social and labour plan. Installation of a 13
kilometre section of the pipeline adjacent to a main road was completed and final testing and
handover occurred in October 2015.

As previously announced, all regulatory consents have been received, all necessary land has
been acquired and rail haulage and port access contracts sufficient for the mine?s stage 1
production have been signed. Sales contracts have been signed that underwrite most of stage 1

The Mining Right Application for Kubu, adjacent to Boikarabelo, was lodged during the
quarter. Kubu was previously known as Waterberg No 1 and encompasses the farm Koert
Louw Zyn Pan. The owners of Koert Louw Zyn Pan and part of the adjacent Nazarov property
signed sales contracts for the properties for ZAR55.2 million after the quarter end. A 10%
deposit was paid with the balance being payable post funding completion.

Mining tenements
The coal mining rights and exploration tenements held in the Waterberg region of South Africa
at the end of the quarter were as follows:
     *MPT15/2012 MR (74%)
   *PR720/2007 (74%)
   *PR678/2007 (74%)
The company has no interest in farm-in or farm-out agreements.
The company is in the process of relinquishing PR720/2007 over the properties Lisbon and
Zoetfontein, as these are distant from the Boikarabelo site and contain minimal resources that
have not been included in the stated JORC resource.
Corporate information
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

Paul Jury
Steve Matthews

Anthony Tregoning, FCR on (02) 8264 1000
* This information was prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with
the JORC Code 2012 on the basis that the information has not materially changed since it was last reported. 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, 31/9/2001.

Name of entity
Resource Generation Limited

ABN                                                                         Quarter ended (?current quarter?)
91 059 950 337                                                                       30 September 2015

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                                -                          -
                             (b) development                                         (3,136)                    (3,136)
                             (c) production                                                -                          -
                             (d) administration                                        (953)                      (953)
1.3       Dividends received                                                               -                          -
1.4       Interest and other items of a similar nature received                           78                         78
1.5       Interest and other costs of finance paid                                       (2)                        (2)
1.6       Income taxes paid                                                                -                          -
1.7       Other                                                                            -                          -
          Net Operating Cash Flows                                                   (4,013)                    (4,013)

          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- Mining related deposit                                                       -                           -
                                                                                              -                           -
          Net investing cash flows

1.13      Total operating and investing cash flows (carried
                                                                                     (4,013)                    (4,013)

                                                                            Current quarter       Year to date (3 mths)
                                                                               $A?000                   $A?000
  1.13      Total operating and investing cash flows (brought
                                                                            (4,013)                    (4,013)
            Cash flows related to financing activities
  1.14      Proceeds from issues of shares, options, etc.                          -                         -
  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)                                                    (42)                      (42)

            Net financing cash flows                                            (42)                      (42)

            Net increase (decrease) in cash held                            (4,055)                    (4,055)

  1.20      Cash at beginning of quarter/year to date                         28,548                    28,548
  1.21      Exchange rate adjustments to item 1.20                             1,677                     1,677
  1.22      Cash at end of quarter                                            26,170                    26,170

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
  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

  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

Financing facilities available
Add notes as necessary for an understanding of the position.
A binding term sheet has been entered into with the Noble Group for a US$65 million loan site infrastructure,
but if drawn would be repayable by 31 March 2016. This has been excluded as an amount available below.
                                                               Amount available           Amount used
                                                                     $A?000                  $A?000
  3.1       Loan facilities                                                             -                     -

  3.2       Credit standby arrangements                                                 -                     -

Estimated cash outflows for next quarter
    4.1    Exploration and evaluation                                                                       -

    4.2    Development                                                                               (5,860)
    4.3    Production                                                                                       -
    4.4    Administration                                                                            (1,028)

           Total                                                                                     (6,888)

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                                                16                    130

     5.2   Deposits at call                                                  25,927                  28,156

     5.3   Bank overdraft                                                           -                       -

     5.4   Other (Contract retentions)                                            227                    284

           Total: cash at end of quarter (item 1.22)                         26,170                  28,570

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
           reduced or lapsed

     6.2   Interests in                       N/A                       N/A               N/A           N/A
           mining tenements
           acquired or
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
            (b) Decreases
                through returns of
                capital, buy-backs,
  7.3       +Ordinary securities               581,380,338        581,380,338              Various          Fully paid

  7.4       Changes during quarter
            (a) Increases                                Nil
                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
            (b) Decreases through
                  securities matured,
   7.7      Options (description                         Nil
            and conversion factor)
   7.8      Issued during quarter                        Nil
   7.9      Exercised during quarter                     Nil
  7.10      Expired during quarter                       Nil
  7.11      Debentures                                  N/A
            (totals only)
  7.12      Unsecured notes (totals                     N/A
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.
Date: 29 October 2015
(Company secretary)



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

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.

JSE Sponsor: Deloitte & Touche Sponsor Services (Pty) Ltd

Date: 29/10/2015 11:05:00 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
© 2018 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.