Wrap Text
Quarterly Activities Report and Quarterly Cash Flow Report (Appendix 5B) for the quarter to 30 June 2014
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 Report and Quarterly Cash Flow Report (Appendix 5B) for the quarter to
30 June 2014
PLEASE NOTE: ALL GRAPHICS HAVE BEEN REMOVED FOR SENS PURPOSES
PLEASE REFER TO TAWANA WEBSITE FOR THE COMPLETE ANNOUNCEMENT
Highlights
Scoping Study
- Scoping study for the Mofe Creek Iron Ore Project demonstrated the potential for a low
capex, low cost, high margin operation with strong Net Present Value (NPV) and Internal
Rate of Return (IRR)
- Key results for the first Stage of development of the Mofe Creek Project confirmed that at
a production rate of 1.2 - 1.5 Mtpa could be sustained for a minimal start-up Capital
(US$53M), with a globally competitive, bottom quartile operating cost of US$43/tonne -
Free on Board (“FOB”)
- Key financials and economic parameters for the Project at a 1.2 and 2.5 Mtpa production
rate are presented in the body of this report
- Tawana Resources has commenced a Pre-Feasibility Study on the Mofe Creek Project
in July
- The Company is in discussions with potential strategic partners, product off-takers, debt
providers and financiers, to facilitate the development of the Project
Corporate
- In April 2014, a placement to investment funds and sophisticated investors to raise $5.0
million (pre–fees) was completed. In addition, the Company raised a further $346,783 by
way of a Share Purchase Plan
- As at 30 June 2014, Tawana Resources held $4.2 million in cash
Mofe Creek Project
Mine, Logistics and Infrastructure
- An application for a pilot mining and bulk sample extraction licence has been submitted
to the Ministry of Land, Mines, and Energy (MLME)
- Meetings have been undertaken with the respective Ministers, Ministries and
Governmental Officers, Senators and the National Investment Committee – to
commence the Approval process for a Mineral Development Agreement (MDA) for the
Mofe Creek Project
- A third resource and exploration drilling program designed to expand and improve the
current classification of the Maiden Resource has commenced at the Project site in July
- Discussions with the National Port Authority (NPA) of Liberia, on the optimal location for
a transhipment and/or direct ship-loading wharf, near the Project site have commenced
- Discussions with operating and developing iron ore companies within Liberia, on
potential co-sharing arrangements for the utilisation of existing or proposed infrastructure
have been initiated
Health, Safety, Environmental and Community
- The formulation of the Environmental and Social Impact Assessment (ESIA) for the Mofe
Creek Project has been awarded to Earth Systems and EarthCons (refer to the ASX
release dated 22 July 2014)
- Site Induction, Fitness for Work (FFW), Light Vehicle and Personal Protective Equipment
(PPE) policies have been developed and rolled-out across the organisation
- An additional 30 contract employees (locals) have been employed to assist with the
current drillling program
Human Resources
- A General Manager, Operations within Liberia (Mr. Frederic Van Haute) has been
appointed and commenced his role in-country on 3 June 2014
- A Community Liaison Officer (Mr Boakai A. Kromah) for the local community within the
Project area has been employed
- The appointment of a full-time Project Director for the Project is pending – the incumbent
will lead and direct the Pre-Feasibility Study for the Project
- Four additional full-time employees within Liberia were recruited during the quarter
Exploration
- 7,500m diamond drilling programme commenced. Drilling to target 100-120Mt total
resource upgrade inclusive of 20-30Mt of Indicated material
- Ongoing rock chip sampling and mapping defining new drill targets at Gofolo West,
Zaway North-West and Koehnko South to be included in current drill programme
CAUTIONARY STATEMENT
Full details of the Scoping Study referred to in this announcement were initially released to
the ASX in an announcement dated 3 July 2014, and should be read in conjunction with this
announcement. All material assumptions underpinning the Scoping Study, production targets
and forecast financial information derived from the production targets as well as any
cautionary statements and disclosures as required under the ASX Listing Rules and 2012
JORC Code are set out in the announcement dated 3 July 2014 and continue to apply and
have not materially changed.
The Scoping Study referred to in this announcement is preliminary in nature as its
conclusions are drawn on inferred (74%) and indicated mineral resources (26%). The
Scoping Study is based on lower-level technical and economic assessments, and are
insufficient to support estimation of Ore Reserves or to provide assurance of an economic
development case at this stage, or to provide certainty that the conclusions of the Scoping
Study will be realised.
There is a low level of geological confidence associated with inferred mineral resources and
there is no certainty that further exploration work will result in the determination of indicated
mineral resources or that the production target itself will be realised. There is also no
certainty that the forecast financial information derived from the production targets will be
realised.
Corporate
Cash Balance and Movements
As at 30 June 2014, Tawana Resources held $4.2 million in cash. Refer to the Appendix 5B
(ASX website) for principal movements in cash for the quarter.
Placement and Share Purchase Plan
In April 2014, the Company successfully completed a placement to institutions, investment
funds and sophisticated investors to raise $5.0 million (before costs). A total of 200 million
fully paid ordinary shares in the capital of the Company were issued to investors at an issue
price of $0.025 per share.
Canaccord Genuity (Australia) Limited acted as Lead Manager for the Placement.
In addition, the Company undertook a Share Purchase Plan (SPP) with existing
shareholders at the same issue price as the placement of $0.025. The SPP raised $346,783.
JSE Classification
The Company has successfully changed its classification on the Johannesburg Stock
Exchange (JSE). The Company is now classified under the new ICB sub-section – General
Mining.
Scoping Study
The Mofe Creek Project (the “Project”) is located 80km northwest of the operating deep-
water port of Monrovia, the capital city of Liberia, West Africa. The project is well serviced by
a sealed bitumen road from Monrovia through the licence area which is located within 20km
of the Liberia coastline. The Company through its wholly owned Liberian subsidiary, Tawana
Liberia Inc. was granted a mineral exploration licence MEL12029 in December 2012 for a
period of three years and renewable for an additional two years. The Company has a 100%
beneficial interest in the tenement.
The Mofe Creek deposits consist of a series of approximately 1km to 3 km strike length
semi-contiguous hills with coincident magnetic anomalies within an approximate 65km strike
length of prospective magnetic anomalies. The hills tested to date and included within the
61.9Mt at 33% Fe Maiden Mineral Resource estimate (refer to the ASX release dated 31
March 2014) are the Gofolo Main, Zaway and Koehnko deposits, with additional targets yet
to be tested.
The Company has only drilled 8km of a total 65km of potential interpreted prospective strike
within its 100%-owned Mofe Creek licence area, with the potential for resource expansion
remaining extremely viable.
Key Findings from Scoping Study
Executive Chairman Wayne Richards said, “This study validates the opinion of the Executive
Management team that the Mofe Creek Project ticks all the investment and development
‘boxes’ with low Capex, low operating costs, significant operating margins, a premium +65%
iron product and a lifespan of at least 14 years. We are positioned to become a globally
competitive, highly profitable producer with a long-term logistics plan that will ensure the
timely and economic development of the Mofe Creek Project.”
“It has strategically positioned the Project as a potential bottom quartile operating cost
producer, with long-term logistics solutions designed to be implemented sequentially, from
forecast cash flows and/or strategic funding.”
Mr Richards said, “The Company would utilise the Scoping Study to further advance
discussions with potential strategic partners, off-takers, debt providers and financiers, in
order to fast track the development of the Project.”
Key results from the Scoping Study for a start-up Project capable of producing 1.0 to1.2
Mtpa is presented below:
Key results – First Stage of development – 1.2 Mtpa project
Initial Product Target 1.0 to 1.2 Mtpa
Capital Cost to Initial Production US$52.9M
(incl. 20% Contingency)
Pricing Assumptions (FOB price/dmt – Pre- US$87.00/t
Tax)
Initial Operating Costs (Cash Costs - FOB) US$42.30/t
Product Quality 64 – 68% Fe “Mofe Creek Premium Fines”
The expansion of the initial start-up plant plus a long-term logistics solution (capable of
sustaining greater than 2.5 Mtpa) is presented in the table below:
Initial Mine Life 14 years
Production Target Profile 2.5 Mtpa
Capital Cost to Initial Production (incl 20% US$52.9M
Contingency)
Revenue (@FOB price of US$87/Dmt – Pre- US$2.5B
Tax)
Operating Costs (LOM avg. Cash Costs - US$40.60 per tonne
FOB)
Net Present Value (NPV @8% DCF, post US$435M
Royalties @ 4.5%)
Internal Rate of Return (IRR) – Pre-Tax 55.8%
Total Project Capital cost (mine, logistics and US$280M – Staged across 4 years of prod’n
port incl. 20% Contingency)
Timeline to initial production 15 months from approval of Mining Licence
Product Quality 64 – 68% Fe “Mofe Creek Premium Fines”
In conjunction with the publication of a Maiden Mineral Resources Estimate for the Mofe
Creek Project (refer to the ASX release dated 31 March 2014), Tawana completed the
required engineering, mining, metallurgical and environmental studies, along with the
logistics design and costings, to finalise the Mofe Creek Project Scoping Study during the
quarter.
The key findings of the Project were released to the market on 3 July, 2014 (Refer to the
ASX release dated 3 July 2014).
The Project Development Plan envisages a staged production ramp up commencing at 1.2
Mtpa (Stage 1A) then increasing production to 2.5 Mtpa (Stage 1B).
The Study identified the opportunity to fast-track the initial 1.2 Mtpa production scenario,
utilising the existing infrastructure within Liberia, including an all-weather sealed bitumen
road from the Gofolo mine to the port of Monrovia, along with the existing deep-water port at
Freeport-Monrovia. The initial production for the first three years acknowledged these
current infrastructure facilities, however in anticipation of expansive growth beyond the
capacity of the port of Monrovia -Freeport, the study assumed that an alternate transhipment
and/or direct ship-loading facility on the coast of Liberia will be required.
The Tawana Project management team focused on the opportunity to accelerate initial
production timelines whilst minimising initial capital expenditure. Consequently, work focused
on Stage 1A and Stage 1B of the Development Plan with production based upon the near
surface, friable itabirite mineralisation.
The key considerations in the Study were a preliminary assessment of the preferred mining
and processing design; the development and expandability of a staged development plan,
reflective of the outstanding approvals and currently installed infrastructure; the simple
transition from a smaller-scale to a larger-scale development, operational and transport
efficiencies for shipping of the ore; and the diligent consideration of community and
environmental impacts the Project may have on Tawana’s stakeholders.
The initial capital expenditure required for first production is estimated at US$52.9 million
(inclusive of a 20% contingency on CAPEX). The total capital cost required to achieve and
sustain 2.5 Mtpa (including an independent haul road and transhipment facility at the coast
of Liberia) is estimated at US$280 million in total (inclusive of a 20% Contingency on
CAPEX). The Study highlighted the possibility to reduce the total capital cost through leasing
arrangements on trucks, plant and/or the new port facility, the use of Build, Own, Operate
and Transfer “BOOT” agreements for key infrastructure such as power, diesel and port
facilities. The PFS will further consider optimisation of water and tailings storage
management and co-development of infrastructure facilities with other developers and
producers within Country.
The Company plans to produce a “Premium Fines” iron ore product grading 64-68% Fe from
the Project. Based on the Maiden Resource, the operating life of mine is initially estimated at
14 years. The first 4 years of mining are based on the indicated mineral resource at the
Gofolo Main deposit (representing 16.5% of the total mineral resource inventory), with the
remainder being 9.7% indicated at Zaway, and 73.8% inferred mineralisation for Gofolo,
Zaway and Koehnko.
The key assumptions underpinning the Scoping Study are set out in the tables below:
Production Profile
Stage 1A (Year 1&2) 1.2 Mtpa
Stage 1B (Year 3) 2.0 Mtpa
Stage 1B (Year 4-14 incl) 2.5 Mtpa
Life of Mine (LOM): 14 years including 10 years of steady state
operation at 2.5 Mtpa
Strip Ratio: 0.73:1 (waste to ore) average LOM
Final product grade: 64-68% Fe - Premium Fines Product
Table 1 | Key Parameters for the complete Stage 1 development of the Mofe Creek Project
Operating cash costs – FOB Liberia Coast - average over Life of Mine (US$)
Mining $13.44/t
Processing $13.19/t
Road Transport $ 3.82/t
Port Logistics $9.19/t
G&A $ 0.96/t
TOTAL OPEX $40.60¢/t
Table 2 | Operating Cost Summary - Life of Mine Average
Capital Costs (US$)
Mine & Associated Infrastructure $ 5 M (assumes contract mining)
Processing Facilities (Stages 1A &1B) $ 76 M
Dedicated Haul Road $ 40 M
Port Development $ 73 M
Support infrastructure $ 44 M
Total Direct Costs $238 M ( including 14% EPCM)
Contingency (20% of Direct Costs) $ 42 M
TOTAL CAPEX $280 M
Table 3 | Capital Cost Summary for Complete Stage 1 Development
The capital cost estimates have been prepared in US dollars with a base date of June 2014,
and have an accuracy range of +30% /-15%, including a Project Contingency of 20% of the
CAPEX.
Production Timeline
The Study considered an initial two- stage development plan:
- Stage 1A: Initial production of up to 1.2 Mtpa for the first 24 months using the
existing sealed road and port facilities at Freeport- Monrovia; and
- Stage 1B: Ramp up of production to 2.5 Mtpa by Year 4, following the completion of
the plant expansion in addition to the construction of a dedicated haul road from the
mine to the new coastal port along with a barging/transhipment facility.
The ramp-up to 2.5 Mtpa can be achieved by doubling key items of equipment at the original
Gofolo Main beneficiation plant. It was assumed that trucking and/or barging of up to 2.5
Mtpa to the port of Monrovia could be sustained for a finite period, whilst the new haul road
and port facility at the coastal location is approved, developed and commissioned.
As soon as practical, after the new port (barging/transhipment facility) has been developed, the
transport logistics processes will transition from road haulage to Monrovia, to dedicated road-
train movements from the mine to the new port location. This process will be determined by the
earliest completion of the port facility and/or the road, and is not subject to a tonnage constraint
(i.e. the Company will migrate to this modus operandi as soon as the preferred, longer-term
logistics solution(s) is/are in place).
The processing plant design will utilise a modular approach to minimize site construction
time and to facilitate the sequential development and installation of additional plant and
equipment to expand production throughput. The location of the initial beneficiation plant will
be at the Gofolo Main deposit, or so-called “Gofolo hub”.
Area Stage 1A (US$ M) Stage 1B (US$ M)
Mine & Associated Infrastructure $2.2 $2.2
Processing Facilities Stage 1A $32.2 $34.6
Haul Road $0.8 $34.3
Port Development $0.0 $64.1
Support Infrastructure $4.3 $34.0
Total Direct Costs $39.5 $169.2
EPCM @ 14% of Direct Costs $5.5 $23.7
Contingency (20% of Direct Costs) $7.9 $33.9
Total Indirect Costs $13.4 $57.6
Total Estimated Cost $52.9 $226.8
Table 4| CAPEX Summary for Stages 1A and 1B
Operating costs – average over Life of Mine Stage 1A (US$ M) Stage 1B (US$ M)
(US$)
Mining $5.4/t $14.0/t
Processing $20.0/t $12.7/t
Road Transport $10.2/t $3.4/t
Port $4.8/t $9.5/t
G&A $1.9/t $0.9/t
TOTAL OPEX $42.30/t $40.50/t
Table 5| OPEX Summary for Stages 1A and 1B
The Company has completed its Baseline Environmental review, and has commenced the
Environmental, Social Impact Assessment (“ESIA”) programme. Likewise, the process of
defining the principles of a Mineral Development Agreement (“MDA”) with the Key
Stakeholders within the Liberian Government has commenced. In the forthcoming quarters,
the MDA, ESIA and Mining Licence will be advanced, along with relevant local and state
legislative approvals, including the confirmation of the new preferred port location on the
Liberian Coast.
Metallurgical Test-Work
An extensive metallurgical test work program was undertaken at the ALS Laboratories in
Perth, over a duration of approximately 10 weeks, from March to May 2014.
The test work program was undertaken to support the design of the process flow sheet,
develop the mass balance parameters for the plant, provide physical data for equipment
selection and future power draw demands, and to provide technical and metallurgical
confidence in the performance of the mineralisation under various operating scenarios.
Metallurgical test work utilised full HQ diamond drill core from the maiden resource drilling
campaign and demonstrated the potential to generate a premium quality concentrate product
grading 65% to 68% Fe with low SiO2 and Al2O3 levels (refer to the ASX release dated 15
May 2014). It also confirmed the expectations from earlier testing using “RC chip” samples.
Approximately 3,000 kg of full HQ drill core was utilised for the program. Ten (10)
representative composites of the mineralisation lithologies from the Gofolo Main and Zaway
Main prospects were subjected to numerous tests, designed to provide technical and
metallurgical information to progress the Process Plant design, for the Project.
Composite identification, mineralisation type and in-situ head grades of the representative
friable oxidised and friable transitional itabirite material from the Gofolo and Zaway Main
deposits, are presented in the following table:
Description
In-situ Head Grades
Composite Location/ Mineralisation Fe% SiO2% Al2O3%
Comp 3 Gofolo Main – Transitional 37.36 44.4 0.70
Friable Itabirite
Comp 9 Zaway – Transitional Itabirite 38.57 43.3 1.09
Comp 2 Gofolo Main – Oxidised 47.14 20.1 3.68
Friable Itabirite
Comp 8 Zaway – Oxidised Friable 38.26 41.1 1.66
Itabirite
Table 6 | Composite identification, mineralisation type and in-situ head grades
Test work results confirmed the potential for the design and construction of a low capital
intensity processing plant with simple gravity beneficiation equipment. These results have
likewise demonstrated that Zaway mineralisation is equally as amenable to beneficiation and
upgrade as the Gofolo mineralisation. Koehnko metallurgical results from RC drill chips
announced previously (refer to the ASX release dated 21 January 2014) also demonstrated
that the Koehnko mineralisation generated an excellent ‘premium grade’ product.
The generation of these results for Gofolo and Zaway were a significant achievement for
both the Company and the Mofe Creek Project as they demonstrated that a ‘Premium’
(+68% Fe) grade quality product could be achieved at a 1 to 0.5mm comminution (crush),
utilising a simple gravity beneficiation process. The 0.5mm crush and screen test work
results provide a high degree of confidence that a highly marketable final product with very
low combined SiO2 and Al2O3 at high mass yield (43% to 48%) can be produced. Presently
the iron ore market pays a sales price premium for +65% Fe grade products – currently
US$9-10/tonne above the benchmark 62% Fe Index (CFR pricing into Tainjin).
These tables replicate the potential operation and performance of gravity spirals and are
used as a laboratory scale test for gravity spiral beneficiation test work.
These core samples also confirmed the soft, friable nature of the coarse-grained
mineralisation and the highly favourable low contaminant mineralogy, making it ideal for
beneficiation, with the added benefit of the mineralisation being located at or near to surface,
and potentially “free-dig”.
Mineralogy and petrology studies were also completed as part of the metallurgical test work
program. The micrograph images below indicated that optimal liberation of the iron oxide
particles occurred at a ~0.5mm crush size, demonstrating the coarse grained nature of the
mineralisation. Refer Figures 4 and 5 overleaf.
Mine, Logistics and Infrastructure
An application for a pilot mining and bulk sample extraction licence has been submitted to
the Ministry of Land, Mines, and Energy (MLME).
Meetings have been undertaken with the respective Ministers, Ministries and Governmental
Officers, Senators and the National Investment Committee – to commence the Approval
process for a Mineral Development Agreement (MDA) for the Mofe Creek Project.
A third resource and exploration drilling program designed to expand and improve the
current classification of the Maiden Resource commenced at the Project site in July. The first
drill rig is currently operating at the Gofolo Main deposit and over 300m drilled has been
drilled to date. Recovery has been very good. The second drill rig has commenced drilling on
the Zaway Main deposit. A total of 450m of drilling (diamond core) had been completed at
the time of writing this report.
Discussions with the National Port Authority (NPA) of Liberia, on the optimal location for a
transhipment and/or direct ship-loading wharf, near the Project site have commenced and
are ongoing. Discussions with operating and developing iron ore companies within Liberia,
on potential co-sharing arrangements for the utilisation of existing or proposed infrastructure
have also been initiated. Senior Tawana executives are currently In Country to further
progress discussions on these logistics and infrastructure fronts.
Health, Safety, Environmental and Social
Health & Safety
Tawana is committed to safety as its highest priority on site and continues to take action to
reinforce this. Safety initiatives and policies developed and implemented in this recent
quarter include a Site Induction presentation, a Fitness for Work (FFW) policy and Light
Vehicle and Personal Protective Equipment (PPE) policies.
Environmental and Social Impact Assessment
The development of the Environmental and Social Impact Assessment (ESIA) for the Mofe
Creek Project has been awarded to Earth Systems and EarthCons. Executive Chairman Mr
Wayne Richards said, “We are pleased to have awarded this key study deliverable to a
company with proven expertise in the assessment of Liberian and West African iron ore
projects”.
Work has already commenced on the ESIA which will assess potential environmental and
social impacts of the Company’s proposed production activities associated with the
development of the Project.
The commencement of the ESIA is a significant step forward for the Project and follows on
from the Company’s recently completed positive Scoping Study Environmental review. The
ESIA will be carried out over the forthcoming year with the final report to be presented to the
Environmental Protection Authority (“EPA”), key stakeholders, the community and related
parties by mid-2015.
Community Relations
As a result of Tawana’s expanding and developing activities, a Community Relations Officer,
Mr Boakai A. Kromah, has been appointed in-country as the Company’s local representative
in local community consultation and interaction. The Company values ongoing, consistent,
open community liaison and dialogue to ensure active and harmonious participation with
local communities and the recent engagement of Mr Kromah will serve to further enhance
this.
Human Resources
Tawana appointed Mr. Frederic van Haute as General Manager, Operations – Liberia in
early June. Mr van Haute was previously General Manager at Trafigura’s subsidiary - Luna
Mining in the Democratic Republic of the Congo (DRC) and has previously held senior
positions at Papillon Resources and Redback Mining. Mr van Haute has considerable West
African experience and good local knowledge.
An additional 30 contract employees (locals) have been employed to assist with the current
drillling program and four additional full-time employees within Liberia were also recruited
during the quarter.
Exploration
Resource drilling has commenced for the Pre-Feasibility Study with a 7,500m diamond core
programme targeting a resource upgrade to 100-120Mt in the inferred and indicated
category inclusive of 20-30Mt of indicated material. Drilling will target additional exploration
tonnes at the Gofolo West, Zaway North-West and Koehnko South targets as well as
upgrades to the existing resource footprints at the Gofolo, Zaway and Koehnko Main
deposits. The majority of indicated resource upgrade will be targeted at the Gofolo Main
deposit as it is the initial mining area proposed for Stage 1 of the Development Plan.
Subsequent to the announcement of the Company’s Maiden Mineral Resource Estimate on
31 March 2014, the Company continued its ongoing regional exploration programme over its
100% owned Mofe Creek Exploration Licence (refer to the ASX release dated 29 April
2014).
Ongoing field work has delineated and refined several high priority satellite exploration
targets within a 1 to 2 km range of the Zaway and Koehnko Main - maiden resource
estimation footprints. Additional targets have been defined West of Gofolo Main.
Field work including mapping, structural measurements and rock-chip sampling by handheld XRF,
in addition to historical rock chip and auger results (refer ASX release dated 29 May 2013) have
been used to delineate and refine highly prospective iron formation targets within the broader
magnetic and topographic trends previously defined.
A total of 4km of combined strike length over nine discrete anomalies has been defined at
the Zaway prospect area, including 2km of discontinuous iron mineralisation along the 3.3km
long Zaway North-West target ridge. Average iron grades for the Zaway area exploration
targets of up to 21-57% Fe were characterised by discrete coarse-grained itabirite outcrops;
very similar to mineralisation intersected in drilling at the Zaway Main deposit (refer to the
ASX release dated 3 February 2014).
At the newly explored Koehnko targets, mineralisation is typically finer grained than Zaway
targets, with finite and limited outcrops. A total of 3km combined strike length over 5
exploration targets has been delineated along the eastern and southern topographic and
magnetic target zones.
About Tawana (ASX & JSE: TAW)
Tawana Resources NL is an iron ore focused ASX and JSE-listed Company with its principal
project in Liberia, West Africa. Tawana’s 100% owned Mofe Creek Project (“the Project”) is a
new discovery in the heart of Liberia’s historic iron ore district, located 20km from the coast
and 85km from the country’s capital city and major port, Monrovia.
Tawana is committed to becoming a mid-tier iron ore producer through the development of the
Mofe Creek Project, which covers 285km2 of highly prospective tenements in Grand Cape
Mount County. The Project hosts high-grade friable itabirite mineralisation which can be easily
upgraded to a superior quality iron ore product in the 64-68% Fe grade range, for which there is
consistent global demand, attracting significant price premiums.
Wayne Richards
Executive Chairman
Tel +61 8 9287 4344
Detailed information on all aspects of Tawana’s projects can be found on the Company’s
website www.tawana.com.au
30 July 2014
Sponsor
PricewaterhouseCoopers Corporate Finance (Pty) Ltd
Cautionary Statement
Full details of the Scoping Study referred to in this announcement were initially released to
the ASX in an announcement dated 3 July 2014, and should be read in conjunction with this
announcement. All material assumptions underpinning the Scoping Study, production
targets and forecast financial information derived from the production targets as well as any
cautionary statements and disclosures as required under the ASX Listing Rules and 2012
JORC Code are set out in the announcement dated 3 July 2014 and continue to apply and
have not materially changed.
The Scoping Study referred to in this announcement is preliminary in nature as its
conclusions are drawn on inferred (74%) and indicated mineral resources (26%). The
Scoping Study is based on lower-level technical and economic assessments, and are
insufficient to support estimation of Ore Reserves or to provide assurance of an economic
development case at this stage, or to provide certainty that the conclusions of the Scoping
Study will be realised.
There is a low level of geological confidence associated with inferred mineral resources and
there is no certainty that further exploration work will result in the determination of indicated
mineral resources or that the production target itself will be realised. There is also no
certainty that the forecast financial information derived from the production targets will be
realised.
Competent Persons Statement
The information in this report that relates to Mineral Resources or Ore Reserves is based on
information compiled by Len Kolff and Iain Macfarlane, who are members of the Australian
Institute of Geoscientists. Len Kolff is a full-time employee of the Company and 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 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves’. Iain Macfarlane is a full-time employee of Coffey
Mining Pty Ltd and 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 2012 Edition of the ‘Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves’ Len Kolff and Iain
Macfarlane consent to the inclusion in the report of the matters based on his information in
the form and context in which it appears.
Forward Looking Statement
This announcement contains certain forward looking statements. These forward-looking
statements are not historical facts but rather are based on the Company’s current
expectations, estimates and projections about the industry in which Tawana Resources NL
operates, and beliefs and assumptions regarding the Company’s future performance. Words
such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates” “potential”
and similar expressions are intended to identify forward-looking statements. These
statements are not guarantees of future performance and are subject to known and unknown
risks, uncertainties and other factors, some of which are beyond the control of the Company,
are difficult to predict and could cause actual results to differ materially from those expressed
or forecasted in the forward-looking statements. Tawana Resources NL cautions
shareholders and prospective shareholders not to place undue reliance on these forward-
looking statements, which reflect the view of Tawana Resources NL only as of the date of
this presentation. The forward-looking statements made in this release relate only to events
as of the date on which the statements are made. Tawana Resources NL will not undertake
any obligation to release publicly any revisions or updates to these forward-looking
statements to reflect events, circumstances or unanticipated events occurring after the date
of this presentation except as required by law or by any appropriate regulatory authority.
Appendix 5B
Mining exploration entity quarterly report
Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10
Name of entity
Tawana Resources NL
ABN Quarter ended (“current quarter”)
69 085 166 721 30 June 2014
Consolidated statement of cash flows
Current quarter Year to date
Cash flows related to operating activities $A’000 (6 months)
$A’000
1.1 Receipts from product sales and related debtors - -
1.2 Payments for (a) exploration & evaluation (1,396) (1,955)
(b) development - -
(c) production - -
(d) administration (613) (1,195)
1.3 Dividends received - -
1.4 Interest and other items of a similar nature
received 28 32
1.5 Interest and other costs of finance paid - -
1.6 Income taxes paid - -
1.7 Other (provide details if material) - -
Net Operating Cash Flows (1,981) (3,118)
Cash flows related to investing activitie
1.8 Payment for purchases of:
(a) prospects - -
(b) equity investments - -
(c) other fixed assets (7) (10)
1.9 Proceeds from sale of:
(a) prospects - -
(b) equity investments - -
(c) other fixed assets - -
1.10 Loans to other entities - -
1.11 Loans repaid by other entities - -
1.12 Other (provide details if material) - -
Net investing cash flows (7) (10)
1.13 Total operating and investing cash flows
(carried forward) (1,988) (3,128)
1.13 Total operating and investing cash flows
(brought forward) (1,988) (3,128)
Cash flows related to financing activities
1.14 Proceeds from issues of shares, options, etc. 5,346 5,607
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 – share issue costs (296) (296)
5,050 5,311
Net financing cash flows
Net increase (decrease) in cash held 3,062 2,183
1.20 Cash at beginning of quarter/year to date 1,113 2,045
1.21 Exchange rate adjustments to item 1.20 1 (52)
4,176 4,176
1.22 Cash at end of quarter
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 1.2 131
1.24 Aggregate amount of loans to the parties included in item 1.10 -
1.25 Explanation necessary for an understanding of the transactions
Directors salaries, fees and superannuation
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.
Amount available Amount used
$A’000 $A’000
3.1 Loan facilities - -
3.2 Credit standby arrangements - -
Estimated cash outflows for next quarter
$A’000
4.1 Exploration and evaluation 1,300
4.2 Development -
4.3 Production -
4.4 Administration 600
Total 1,900
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 1,621 1,093
2,555 20
5.2 Deposits at call
- -
5.3 Bank overdraft
- -
5.4 Other (provide details)
4,176 1,113
Total: cash at end of quarter (item 1.22)
Changes in interests in mining tenements
Tenement Nature of interest Interest at Interest at
reference (note (2)) beginning end of
of quarter quarter
6.1 Interests in mining
tenements relinquished,
reduced or lapsed
6.2 Interests in 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 quoted Issue price per Amount paid up per
security (see note security (see note 3)
3) (cents) (cents)
7.1 Preference - -
+securities
7.2 Changes during N/A N/A
quarter
7.3 +Ordinary 1,465,250,387 1,465,250,387
securities
7.4 Changes during
quarter
(a) Increases 213,871,344 213,871,344 $0.025 $0.025
through issues
(b) Decreases
through returns
of capital, buy-
backs
7.5 +Convertible - -
debt securities
7.6 Changes during N/A N/A
quarter
7.7 Options Exercise price Expiry date
Unlisted options 5,000,000 - $0.05 9 Sep 2014
Unlisted options 1,250,000 - $0.05 10 Nov 2015
Unlisted options 28,500,000 - $0.036 30 April 2015
Unlisted options 10,000,000 - $0.0001 31 August 2014
Unlisted options 10,000,000 - $0.0001 31 August 2015
Unlisted options 10,000,000 - $0.0001 31 August 2016
Unlisted options 30,750,000 - $0.015 12 December 2016
Unlisted options 10,000,000 - $0.046 12 December 2016
Unlisted options 10,000,000 - $0.018 12 December 2016
Unlisted options 1,000,000 - $0.039 20 January 2017
7.8 Issued during - - - -
quarter
7.9 Exercised during - - - -
quarter
7.10 Expired during - - - -
quarter
7.11 Debentures - -
7.12 Unsecured - -
notes
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: 30 July 2014
Company secretary
Print name: Aaron Finlay
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.
Date: 30/07/2014 10:35:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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