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TAW - Tawana Resources NL - Quarterly activities and cash flow report
1 April - 30 June 2007
Tawana Resources NL
(Incorporated in Australia)
(Registration number ACN 085 166 721)
Share code on the JSE Limited:
TAW ISIN: AU000000TAW7
Share code on the Australian Stock Exchange Limited:
TAW ISIN: AU000000TAW7
("Tawana" or "the Company")
Quarterly Activities and Cash Flow Report
1 April - 30 June 2007
Key Points
*Trial Mining of Kareevlei Wes progressing on schedule
25 tph DMS plant being commissioned on site
Excavation of kimberlites to commence Q4 2007
Kimberlites known to be diamondiferous
*Lexshell alluvial diamond project Mining Right finalised
Drilling of alluvial channel to commence Q4 2007
*Carter Block Joint Venture signed
Drilling of Falcon targets to commence Q3 2007
*Riverton Joint Venture signed
10tph DMS plant moved to site
Bulk sampling of kimberlite to commence Q3 2007
*Orapa Prospecting Licence granted
Geophysical surveys completed over known kimberlites
South Africa
Kareevlei Wes Project, Kimberley Region, South Africa
(74% owned and operated by Tawana; 26% Seven Falls)
The Kareevlei Wes Project comprises a cluster of 5 kimberlitic pipes (KV1-KV5),
which vary in surface area from 5.5 ha to less than 0.1 ha. Previous drilling
and bulk sampling by Tawana has shown that KV1 and KV2 are potentially economic.
Program
Establishing the plant and facilities to undertake the trial mining program,
aimed at mining up to 20,000 tonnes from kimberlites KV1 and KV2, commenced
during the quarter with the transport of the Company`s dense media separation
plant to site. The plant and infrastructure is on schedule for the commissioning
early Q4 2007, when excavation of the KV1 and KV2 kimberlites will commence.
Lexshell Diamond Project, Kimberley Region, South Africa
(Tawana 44% and operator /Guma Resources 44%/ Lexshell 12% revenue share)
As previously announced, Tawana entered into a joint venture with its strategic
alliance partner, Guma Resources Pty Limited, to explore and mine the Lexshell
alluvial diamond project in the Northern Cape Province of South Africa. The
project is located on a palaeo-channel of the Vaal River adjacent to established
alluvial diamond mines.
The section of the Vaal River alluvials in which this project is located is
noted for the prolific production of large high quality diamonds. Mining has
taken place for about 100 years and the area still hosts one of the largest
alluvial diamond mines in the world.
All statutory requirements relating to the granting of the new order Mining
Right over project have been completed. Drilling of the palaeo-channel is
scheduled to commence during Q4 2007.
Carter Block Project, Lime Acres, South Africa
(Tawana earning 40% and operator/Kimberley Consolidated Mining Limited diluting
to 60%)
A joint venture (the Carter Block Joint Venture) was signed with Kimberley
Consolidated Mining Limited (KCM), an unlisted South African company which has
advanced plans to list shortly on the JSE Limited and is considering listing on
the Alternative Investment Market of the London Stock Exchange in due course.
The Carter Block Joint Venture has been formed to prospect and evaluate
kimberlites situated on a 266 square kilometer new order Prospecting Right
surrounding the De Beers owned Finsch Mine, South Africa (The Carter Block).
The granted tenement incorporates three known kimberlites, fourteen BHP
Billiton-
generated Falcon targets, and four aero-magnetic survey targets. The Joint
Venture`s initial focus is the BHP Billiton - generated Falcon Targets and the
aero-magnetic survey targets.
Tawana has access to the Falcon data by virtue of the separate Daniel Joint
Venture with BHP Billiton. BHP Billiton is not participating in the Carter Block
Joint Venture but has consented to Tawana using the Falcon data in return for a
2.5% royalty on any future diamond revenue generated by Tawana from the use of
the data in the Carter Block.
Tawana is able to earn 40% equity in each individual Falcon and aero-magnetic
target by identifying kimberlites through drilling and conducting bulk sampling.
Expenditure on further evaluation work will be contributed by KCM and Tawana on
a pro-rata basis. Tawana will manage the project.
The three known kimberlites are currently being prospected by KCM and early
indicator mineral sampling has been positive. Several G10 pyrope garnets were
recovered from the Shoan kimberlite, indicating that this kimberlite is likely
to be diamondiferous. The agreement provides that should Tawana wish to
participate in the exploration of these known kimberlites, Tawana would be
entitled, subject to contract, to take up an agreed participating interest
therein.
The Carter Block also incorporates known diamondiferous alluvial deposits which
while they will remain wholly-owned and operated by KCM are adjacent to the
Tawana alluvials. An opportunity for future co-operation between Tawana and KCM
with respect to parallel development of the alluvials is being considered.
Riverton Kimberlite Project, Kimberley Region, South Africa
(Operated by Tawana; Tawana earning 70%,Taormina Mining (Pty) Ltd diluting to
30%)
Tawana entered into a joint venture with Taormina Mining (Pty) Limited
("Taormina"), an unlisted South African company, to prospect and evaluate a
kimberlite situated 25 kilometers north of Kimberley, South Africa.
The kimberlite is a 4 hectare pipe known locally as the Riverton Mine and is
anecdotally reported to have produced good quality diamonds when it was mined by
small scale diggers during the 1990`s. Mining is reported to have ceased due to
permitting and safety issues. No professionally controlled mining has taken
place at Riverton, and Tawana will apply modern exploration and mining
techniques to evaluate the potential of this project.
Tawana is able to earn 51% equity in the project by conducting a 2000 tonnes
bulk sampling program followed by an 8000 tonnes evaluation program if
warranted. Thereafter Tawana has the option to increase its equity to 70% by
paying Taormina Rand 1.5million (approx. A$260,000).
The Company`s 10 tonne per hour dense media separation plant has been moved to
site and construction is on schedule for the commencement of bulk sampling in Q3
2007.
Melbourne Laboratory
Activity within the Melbourne Laboratory during the quarter was primarily
focused on the examination of the Pilbara exploration samples.
Treatment, examination and reporting of third party exploration samples was also
undertaken.
Botswana Projects
Orapa Project, Botswana
(Tawana 100%)
In April 2007 the Company was granted a new prospecting licence over an area of
approximately 57 square kilometers, covering 8 kimberlites in the Orapa
kimberlite field in Botswana. Applications for this Prospecting Licence were
submitted by a number of companies on a competitive basis. The Prospecting
Licence is held by Seolo Pty Ltd, a 100% owned Botswana registered subsidiary of
Tawana.
The Orapa kimberlite field is located in north eastern Botswana, and includes
the Orapa, Letlhakane and Damtshaa diamonds mines, which produce in excess of 13
million carats of diamonds per year. The Orapa kimberlite field is one of the
largest diamondiferous kimberlite fields in the world, containing 79 known
kimberlites, of which the majority has been proven to be diamondiferous. Orapa,
some 15km from Tawana`s project area, is one of the largest producing
kimberlites in the world and is 113 hectares in surface area.
The Company plans to undertake a program of evaluation which will entail
detailed geophysics, trenching and drilling to establish the size of the
kimberlites, followed by bulk sampling to determine the grade and diamond
quality of the kimberlites. Initial indications are that the diamondiferous BK24
is in excess of 3 hectares in surface area and at least one other kimberlite has
a surface area of 2 hectares. No previous bulk sampling has been conducted on 7
of the eight kimberlites. An initial review of available airborne geophysical
data has indicated the possible presence of at least one new kimberlite in the
Prospecting Licence area.
Ground-based gravity and magnetic surveys were conducted during the quarter.
Preliminary interpretation of the data collected by these surveys indicates that
the kimberlite BK20 is larger in surface area that previously thought. Drilling
to verify this interpretation will be conducted in the second half of 2007.
Melbourne Laboratory
Activity within the Melbourne Laboratory during the quarter was focused on the
completion of examination of the Pilbara exploration samples and samples from
the Riverton and Daniel Kimberlite Projects in South Africa.
Treatment, examination and reporting of third party exploration samples was also
undertaken.
Corporate
Financial
At the end of March, the Company`s cash reserves were $1.227M.
Contact:
Wolf Marx
Tel: +61 (0)3 98635222
Mob: + 61 (0)428 398446
Email:wolf.marx@tawana.com.au
This report is based on information compiled by Wolf Marx BSc, BA, FAusIMM,
CPGeo, Managing Director of Tawana Resources NL. He has sufficient experience
relevant to the style of mineralisation and types of deposits under
consideration, and to the activities undertaken, to qualify as a competent
person as defined in the 2004 edition of the "Australasian Code for the
Reporting of Mineral Resources and Ore Reserves"
All press releases and announcements may be inspected on the Company`s web site,
namely: www.tawana.com.au
31 July 2007
Sponsor
PricewaterhouseCoopers Corporate Finance (Pty) Ltd
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
Tawana Resources N.L.
ABN Quarter ended
("current quarter")
69 085 166 721 30 June 2007
Consolidated statement of cash flows
Current Year to
Cash flows related to operating activities quarter date ( 6
$A`000 months)
$A`000
1.1 Receipts from product sales and related (12) 29
debtors
1.2 Payments for (a) exploration and (581) (827)
evaluation
(b) development
(c) production
(d) administration (422) (871)
1.3 Dividends received
1.4 Interest received 2 2
1.5 Interest and other costs of finance
paid
1.6 Income taxes paid
1.7 Other (provide details if material) (25) 412
(VAT Refund from SARS)
(1,038) (1,255)
Net Operating Cash Flows
Cash flows related to investing
activities
1.8 Payment for purchases of:
(a)prospects
(b)equity investments (1) (4)
(c) other fixed assets
1.9 Proceeds from sale of:
(a)prospects
(b)equity investments
1.10 Loans to other entities
1.11 Loans repaid by other entities
Net investing cash flows (1) (4)
1.13 Total operating and investing cash (1,039) (1,259)
flows (carried forward)
1.13 Total operating and investing cash (1,039) (1,259)
flows (brought forward)
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 (provide details if material) - -
Net financing cash flows
Net increase (decrease) in cash held (1,039) (1,259)
1.20 Cash at beginning of quarter/year to 2,317 2,653
date
1.21 Exchange rate adjustments to item 1.20 (51) (167)
1.22 Cash at end of quarter 1,227 1,227
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 74
included in item 1.2
1.24 Aggregate amount of loans to the parties included Nil
in item 1.10
1.25 Explanation necessary for an understanding of the transactions
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
Nil
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
Nil
Financing facilities available
Add notes as necessary for an understanding of the position.
Amount Amount used
available $A`000
$A`000
3.1 Loan facilities Nil Nil
3.2 Credit standby arrangements Nil Nil
Estimated cash outflows for next quarter
$A`000
4.1 Exploration and evaluation 1,000
4.2 Development 0
1,000
Total
Reconciliation of cash
Reconciliation of cash at the end of the Current Previous
quarter (as shown in the consolidated quarter quarter
statement of cash flows) to the related $A`000 $A`000
items in the accounts is as follows.
5.1 Cash on hand and at bank 211 411
5.2 Deposits at call 1,016 1,906
5.3 Bank overdraft - -
5.4 Other (provide details) - -
Total: cash at end of quarter (item 1,227 2,317
1.22)
Changes in interests in mining tenements
Tenement Nature of Interest Interest
reference interest at at end
(note (2)) beginning of
of quarter
quarter
6.1 Interests in EL9722 Sole interest 100% Nil
mining (Packsaddle NT)
tenements
relinquished, EL2927 (Elliston
reduced or South Australia) Joint Venture 80% Nil
lapsed Interest
EL47/1122
(Pilbara,
Western
Australia) 66.6% Nil
Joint Venture
PL36/2003 Interest
Borolong
100% Nil
Sole interest
(100%
relinquished)
6.2 Interests in PL61/2007 Sole Interest Nil 100%
mining Orapa
tenements
acquired or
increased
PL86/2007 Sole Interest Nil 100%
Borolong
PL87/2007 Sole interest Nil 100%
Borolong
NC
NC Joint Venture Nil 100%
30/5/1/2/2/081MR Interest
Kareevlei Wes
NC Earning Joint Nil Nil
30/5/1/2/2/405 Venture
PR Interest
Riverton
NC Joint Venture Nil 44%
30/5/1/2/2/054 Interest
MR (Share of
Lexshell revenue)
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.
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 Issue Amount
number quoted price per paid up
security per
security
7.1 Preference
+securities Nil Nil
(description)
7.2 Changes during
quarter
(a) Increases
through issues
(b) Decreases
through returns of
capital, buy-backs,
redemptions
7.3 +Ordinary securities 87,097,481 87,097,481 various Various
7.4 Changes during Nil Nil
quarter
(a) Increases
through issues
(b) Increase through
exercise of options
7.5 +Convertible debt
securities Nil Nil
(description)
7.6 Changes during
quarter
(a) Increases
through issues
(b) Decreases
through securities
matured, converted
7.7 Options (description Exercise Expiry
and conversion 23,934,843 22,344,843 price date
factor) $1.00 30 April
2008
7.8 Issued during quarter Nil Nil
7.9 Exercised during Nil Nil
quarter
7.10 Expired during Nil Nil
quarter
7.11 Debentures Nil Nil
(totals only)
7.12 Unsecured notes Nil Nil
(totals 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 4).
2 This statement does give a true and fair view of the matters disclosed.
Sign here: W.T.Marx Date: 31 July 2007
(Director)
Print name: W.T.Marx
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 1022: Accounting for Extractive
Industries and AASB 1026: Statement of Cash Flows apply to this report.
5 Accounting Standards ASX will accept, for example, the use of International
Accounting 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.
Date: 31/07/2007 11:28:01 Supplied by www.sharenet.co.za
Produced by the JSE SENS Department.