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Tawana Resources NL - Reviewed results for the year ended 31 December 2005

Release Date: 31/03/2006 11:08:01      Code(s): TAW
Tawana Resources NL - Reviewed results for the year ended 31 December 2005      
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")                                                     
31 March 2006                                                                   
Reviewed Results For The Year Ended 31 December 2005                            
These  abridged results are an extract of the Annual Financial  Statements      
released  in Australia today.  These full Annual Financial Statements  are      
available on the company"s website www.tawana.com.au.                           
Comment on Company Operations by Wolf Marx, Managing Director                   
TAWANA GROUP"S DIAMOND PROJECTS                                                 
Brief overviews of Tawana"s diamond projects, which are all located in          
prospective areas, are as follows.                                              
SOUTH AFRICAN PROJECTS                                                          
TAWANA ALLUVIAL PROJECT, LIMEACRE DISTRICT, KIMBERLY REGION, SOUTH AFRICA       
(74%  owned  and operated by Tawana with BHP Billiton participating  in  a  2.5%
gross revenue royalty; Seven Falls 26%)                                         
The Tawana Alluvial Project (TAP) area encompasses two alluvial deposits, the   
Feeder Channel and the Eastern Gravels, which extend from 300 meters from the De
Beers owned Finsch Mine for a distance of approximately 18 kms from the mine.   
These deposits resulted from the discovery by Tawana during early exploration of
the Daniel Alluvial Project (DAP).                                              
The key interest in the TAP relates to the discovery by means of Falcon         
technology of a large, previously unknown occurrence of diamondiferous alluvial 
deposit, immediately down slope of one of the world"s most significant hard rock
diamond mines.  In recognition of Tawana"s discovery, and their smaller size    
potential relative to the DAP, BHP Billiton agreed in 2003 to the 100% transfer 
of ownership of the Feeder Channel and Eastern Gravels, now known as the "Tawana
Alluvials", to Tawana in return for a 2.5% gross royalty revenue participation  
and the rights to market diamonds recovered from the TAP. 26% of the TAP was    
subsequently sold to Seven Falls as part of Tawana"s BEE initiative.            
During the first quarter of 2004, diamonds were recovered from 500 tonnes of    
gravel samples of the Tawana Alluvials. The samples extracted by means of a 10,5
inch percussion drill showed diamonds distributed throughout the channel system,
from the northern boundary to the southern extremity of the DAP and the TAP, as 
well as laterally and horizontally within the gravel beds provided management   
with sufficient encouragement to commit to a large-scale bulk-sampling program, 
utilising Bauer drilling.                                                       
The aim of the bulk sampling programme was to collect approximately 20,000      
tonnes of material from each of the Feeder Channel and the Eastern Gravels. To  
achieve this, it was planned to drill 70-80 2.5 m diameter holes in each        
location. This would enable the geology, stratigraphy and diamond-bearing       
potential of the Feeder Channel and Eastern Gravels to be determined in much    
more detail. This drilling was carried out between August 2004 and June 2005.   
Holes were sited using existing geophysical data as well as knowledge from      
previous drilling. A summary of the drilling statistics is shown in Table 2.    
Table 2.  Summary of Bauer drilling in the Feeder Channel and Eastern Gravels   
(overall SG is estimated at 2.8 in the Feeder Channel, 2.5 in the Eastern       
Gravels)                                                                        
                      No. of    Total depth       Total       Total             
holes    drilled (m)      volume      tonnes             
                                                   (m3)    (Approx)             
Feeder Channel            93       1,965.60    8,698.01   24,354.43             
Eastern Gravels           69       1,467.50    7,205.43   18,013.56             
Totals                   162       3,433.10   15,903.44   42,367.99             
The depth of the Bauer holes in the Feeder Channel and Eastern Gravels ranged   
from a few metres to the maximum drilling depth of the Bauer rig (54m). The     
average depth of all holes drilled was 21m. A number of deeper sections or      
potholes were intersected with the drilling.                                    
At the end of 2005, 46% of the material drilled from the Feeder Channel and 65% 
from the Eastern Gravels had been processed.                                    
A total of 4,027 cubic meters of the Feeder Channel Bauer drill samples was     
tested during 2005.  Diamonds were recovered from all samples confirming the    
wide spread diamondiferous nature of the prospect. 286 diamonds were recovered  
from the Feeder Channel, weighing in total 29.76 carats.  The average stone size
for the Feeder Channel diamonds is 0.1 carats per stone.                        
A total of 4,672 cubic meters of the Eastern Gravels Bauer drill samples was   
tested during 2005.  As with the Feeder Channel, diamonds were recovered from   
all samples confirming the wide spread diamondiferous nature of the prospect.   
284 diamonds were recovered from the Eastern Gravels, weighing in total 40.57   
carats.  This includes the largest stone recovered of 4.66 carats. The average  
stone size for the Eastern Gravels is 0.14 carats per stone.                    
Mr Gregory Katz, a valuer based in Johannesburg, South Africa, valued diamonds  
recovered from the Bauer drilling samples.  Diamonds were split into parcels    
from the top 15 metre and bottom 5 metre gravel intersections and were valued as
follows:                                                                        
       Intersection   Number of       Total       Average      Value*           
       meters          diamonds      carats  diamond size   US$/carat           
Carats/stone                       
       0 to 15              199       30.06          0.15         274           
       15 to 20              37        3.98          0.11          58           
*    The diamond values from a deposit may change upon submission for valuation 
of larger parcels.                                                         
The diamond values from the top section of the deposit exceeded management"s    
expectations and are considered highly encouraging.  The minimal overburden     
allows for potential future operating costs to be at the lower end of South     
African alluvial operating cost range.                                          
Operating costs for large-scale alluvial diamond mines in South Africa are      
estimated at US$3.60 per cubic metre.  At a value of US$274 per carat the       
breakeven grade needed is 1.32 cphm3.                                           
The Eastern Gravels deposit is estimated at 80 million tonnes, which gives the  
potential for large-scale mining.                                               
After completion of the Bauer drilling, trial mining was conducted during late  
2005 in an area which appeared to typify the geology and grade of the Eastern   
Gravels. Diamond grades from the regularly spaced Bauer drilling in the top 5   
meters of the gravels in this section were 2.27 and 3.07 carats per 100 cubic   
meters (cphm3). The Bauer sample grades were significantly greater than the     
estimated breakeven grade (1.32 cphm3) of the Eastern Gravels providing strong  
encouragement for the economic potential of this deposit.                       
Excavation during trial mining has shown that there is an overburden of only    
1.6m of fine sand and gravel, which contains traces of diamonds. This is        
underlain by 4-5m of coarse gravels. Diamonds recovered from the base of these  
gravels recorded an average size of 0.4 carats per stone (ct/st).               
A grade of 0.48cphm3 grade was reported from the trial mining pit, which is     
lower than the grades from the nearby Bauer holes. This grade discrepancy is    
considered typical of the erratic distribution of diamonds in alluvial deposits.
Industry experience with Bauer drilling is that the relatively large volumes    
extracted and the regular spacing of drill holes provides the most reliable     
evidence of grade distribution in an alluvial deposit.                          
The proposed next stage for the Eastern Gravels Project is a large scale        
operating trial. Tawana will seek to secure involvement of an operator having   
the plant, mobile equipment and staff to mine at a rate that will confirm the   
project economics. Discussions have commenced with several alluvial operators.  
It should be noted that the Company considers that any tonnage and grade        
estimates reflected do not satisfy the definition of a Mineral Resource as set  
out in the JORC Code as insufficient work has been conducted to be able to      
determine the grade and tonnage of the deposit with greater accuracy. Further   
work may or may not establish a Mineral Resource on the property.  Accordingly, 
the estimate of grade is made as provided by paragraph 18 of the JORC Code in   
relation to an exploration target or exploration potential. The diamonds were   
recovered from the minus 19mm plus 1.5mm fractions of gravels sampled by 2.5m   
diameter Bauer drill holes. The gravels were processed in the Company"s DMS     
plant with diamond recovery by a Flowsort x-ray plant and a grease table.       
DANIEL KIMBERLITE PROJECT, LIMEACRES DISTRICT, SOUTH AFRICA                     
(22.2% owned and operated by Tawana , 51.8% owned by BHP Billiton and 26% owned 
by Seven Falls)                                                                 
The Daniel Kimberlite Project (DKP) is a joint venture between Tawana, BHP      
Billiton and Seven Falls and encompasses an area 30kms in radius centred on the 
De Beers owned Finsch Mine.  Utilisation of Falcon technology has led to the    
identification of kimberlitic targets situated in the Limeacres District of     
South Africa.                                                                   
Percussion drilling of some of these targets was conducted during 2004 and 2005 
which resulted of in the discovery of three new kimberlites (A1, A2, A95).      
The kimberlites are in the form of near vertical dykes or fissures with several 
blows or small pipes and can be traced by magnetic data over several kilometres.
The A95 kimberlite dyke can be traced to the Eastern Gravels diamondiferous     
alluvial deposit.                                                               
The high quality (US$274 per carat) diamonds found in the Eastern Gravels are   
different from those found in the drainage channel from the Finsch Mine and are 
thought by Tawana geologists to be derived from a different source. The A95     
kimberlite may be this source.                                                  
Tawana completed a small bulk sampling program designed to determine whether the
kimberlite A95 is diamondiferous. 500 tonnes of calcretised kimberlite were     
excavated from the top 2 metres of two sections of A95 and processed in the     
Company"s Dense Media Separation plant. Four small diamonds were recovered      
weighing a total 0.14cts proving that the kimberlite is diamondiferous but      
giving no indication of the grade. Further drill testing of this kimberlite is  
planned.                                                                        
Following the discovery of kimberlites A1, A2 and A95, the BHP Billiton Falcon  
data was reviewed, resulting in a reassessment of all of the previously         
identified targets and the selection of several of these for drill testing      
during 2006.                                                                    
The Company"s 30 tph DMS plant will remain at the Tawana Alluvial site to       
process the bulk samples collected from A95 and any other kimberlites discovered
in the Daniel Kimberlite Project area.                                          
DANIEL ALLUVIAL PROJECT                                                         
(29.6% owned and operated by Tawana 44.4% owned by BHP Billiton and 26% Seven   
Falls)                                                                          
The DAP encompasses the main channel of an ancient river channel that was       
initially discovered by BHP Billiton utilising its Falcon technology.  Following
a program of drilling and bulk sampling, the Company confirmed the DAP to be a  
palaeochannel carrying diamond bearing "ancient" gravels, strikingly large in   
area and volume and that in situ diamonds were most likely the erosion product  
of the nearby kimberlitic pipe presently mined at Finsch Mine.                  
During 2004, the Company completed a 500 tonne bulk sample by means of 10,5 inch
diameter percussion drilling from DAP.  The gravels were processed through the  
Company"s on-site DMS plant and X-ray diamond extraction facilities.  Diamonds  
were discovered from 8 of the 14 sites sampled. Their disposition along the     
length of the channel and at depth is evidence that diamond mineralization is   
extensive.                                                                      
After review of these and earlier results, BHP Billiton confirmed its intention 
to participate in the DAP and to this end, agreement was reached between BHP    
Billiton and the Company whereby, inter alia, the Company will enjoy a 40%      
ownership of DAP and will be the projects operator.  Furthermore, any future    
diamond production emanating from DAP will be marketed in conjunction with BHP  
Billiton. Subsequently 26% of the DAP was sold to Seven Falls as part of        
Tawana"s and BHP Billiton"s BEE initiatives.                                    
KAREEVLEI WES PROJECT, KIMBERLEY REGION, SOUTH AFRICA                           
(74% owned and operated by Tawana; 26% owned by Seven Falls)                    
The Kareevlei Wes Project (KWP) comprises a cluster of 5 kimberlitic pipes (KV1-
KV5), which vary in surface area from a large 5.8 ha to 0.3 ha. Drilling to a   
depth of 100 meters showed that the tonnage of KV3 is 13Mt and that of KV2 is   
2Mt.  The surface area of KV1 has been determined by shallow drilling to be 1.2 
hectares. The key interest in this project relates to the relatively large size 
of the pipes in the cluster and, particularly, the exceptional quality of the   
diamonds in the kimberlites.                                                    
In early 2004, the Company conducted a 10,5 inch diameter grid based percussion 
drilling program on 2 of the 5 kimberlite pipes in the KWP cluster with the aim 
of establishing the tonnage potential of the pipes as well as to sample diamonds
in the pipes for purposes of preliminary quality valuation.  Excellent results  
encouraged management to commit to a Bauer drilling program to extract 6,500    
tonnes of kimberlite from the 4 largest kimberlites in the cluster.  This       
drilling was completed in August 2004.  During the quarter ending 30 June 2005, 
the construction of a DMS plant was completed and processing of the Bauer       
drilling bulk samples commenced.                                                
As a result of this processing the grade of KV1 and KV2, was estimated to be    
8.57 cpht. Subsequent statistical analyses of the diamonds recovered from these 
two kimberlites suggested that the grade could be expected to be 11cpht if      
larger parcels of diamonds could be produced.                                   
The grade of KV3 is variable due to several different phases encountered in the 
top 30 - 40m as indicated by Bauer drilling. The northern 3ha of the pipe is    
composed of an homogenous phase of kimberlite and has an estimated grade of     
4.89cpht, based on processing the minus 6mm fraction. Earlier 10.5 inch         
percussion drilling in the northern section of KV3 achieved a higher grade of   
6.10cpht. This discrepancy could be due to the fact that the percussion drilling
sampled deeper sections of the kimberlite.                                      
The KV5 kimberlite was sampled with two Bauer holes. The estimated grade, based 
on the minus 6mm fraction from the two holes was 3.70cpht and 8.06cpht, with an 
average grade of 5.70cpht. No valuations of the diamonds recovered from KV5 have
been conducted.                                                                 
Diamonds from KV1 and KV2 were valued at US$110/ct with the valuers predicting  
substantially higher values for larger parcels. This prediction was supported by
subsequent statistical analysis of a parcel from the KV1 and KV2 kimberlites,   
which suggested that US$164/ct was a reasonable value estimate for diamonds from
these kimberlites. Subsequently a parcel of 33.24ct of diamonds from KV3 was    
valued by Mr Katz of Johannesburg at US$170/ct.                                 
At the estimated operating cost of open pit kimberlite mining and processing in 
South Africa of US$7.53/t, the required breakeven grade at a diamond value of   
US$170 /ct is 4.43 cpht                                                         
Kimberlite    Size*     Grade  Diamond Value***      Value  Cost****            
                 ha      Cpht         US$/carat      US$/t     US$/t            
KV1             1.2      11**               164      18.04      7.53            
KV2             1.4      11**               164      18.04      7.53            
KV3             5.8 4.89-6.10               170 8.31-10.37      7.53            
KV5             2.1      5.70               N/A         NA      7.53            
*    Based on 10.5 inch drilling to 100m for KV2 and KV3, surface percussion    
drilling for KV1 and geophysical interpretation for KV5.                   
**   Based on statistical analysis of a parcel of diamonds recovered from the   
     minus 6mm fraction of material excavated by Bauer drilling. Not JORC/SAMREC
     compliant. See note below.                                                 
***  Based on best estimate. Larger parcels of diamonds may change the given    
     values substantially.                                                      
**** Estimated mining and operating costs of open cut kimberlite mines in South 
     Africa by Snowden Mining Consultants. (see Tawana release 7 December 2005) 
An application for a Mining Right for Kareevlei is being processed the South    
African Department of Minerals and Energy. The Company has been advised that the
Mining Right Application will take at least four months to process. During this 
period, the Company will develop the full scale commercial operating plan for   
the Kareevlei Wes operation.                                                    
Note: The Company considers that any tonnage and grade estimates reflected do   
not satisfy the definition of a Mineral Resource as set out in the JORC Code as 
insufficient work has been conducted to be able to determine the grade and      
tonnage of the deposit with greater accuracy. Further work may or may not       
establish a Mineral Resource on the property.  Accordingly, the estimate of     
grade is made as provided by paragraph 18 of the JORC Code in relation to an    
exploration target or exploration potential. The diamonds were recovered from   
the minus 19mm plus 1.5mm fractions of kimberlite sampled by 2.5m diameter Bauer
drill holes. The kimberlite material was processed in the Company"s DMS plant   
with diamond recovery by a Flowsort x-ray plant and a grease table.             
PERDEVLEI KIMBERLITE PROJECT, KIMBERLEY REGION, SOUTH AFRICA                    
(74% owned and operated by Tawana; 26% owned by Seven Falls)                    
The Perdevlei Kimberlite Project (PKP) comprises 2 kimberlite pipes having a    
surface area of approximately 1,7 Ha and 0,2 Ha, respectively.  Both of these   
kimberlites, K1 and K2 are known from previous work to be diamondiferous. The   
key interest in PKP relates to the fact that K1 contains good quality diamonds  
and with proximity to KWP being favourable, possible future economies of scale  
exist.                                                                          
Based on previous drilling and bulk sampling, the grade of K1 has been estimated
to be between 15 and 18cpht. No recent valuations of Perdevlei diamonds have    
been conducted but a parcel of diamonds was sold in 1998 for US$95 per carat by 
previous owners of this kimberlite.                                             
Currently a 2000t trial mining program is underway at K1. The objective of the  
program is to achieve a more accurate estimate of grade, stone size distribution
and average diamond values.                                                     
If warranted, the results of this program, together with estimated operating and
capital costs, will form the basis of a mining feasibility study. The study will
also take into account the results of bulk samples from the five Kareevlei Wes  
kimberlites, located 25 km north of Perdevlei, which may be mined jointly.      
Transhex, a South African based diamond producer, holds an option to acquire 35%
of the project, exercisable 6 months after a decision to mine has been made, for
the payment of 3.5 times the costs incurred by Tawana in establishing the       
viability of, and bringing into production, a diamond deposit.  Transhex holds a
5% royalty on the sale of diamonds payable up to a limit of Rand 2 million.     
SEOLO DIAMOND PROJECT, BOTSWANA                                                 
(100% owned by Tawana)                                                          
Exploration licenses covering 2009 square kilometers in the prospective northern
part of Botswana, between the city of Francistown and the Orapa kimberlite      
province, were granted to Tawana during early 2004.  The licences cover areas   
which are known to be geologically favourable for kimberlite intrusions and     
which were known to include sites where kimberlitic indicator minerals had been 
recovered by earlier explorers.                                                 
Kimberlitic indicator minerals were recovered from soil samples collected over  
identified targets during 2004 and 2005. Such targets were identified from      
existing magnetic and previous sampling data. Additional follow up sampling is  
planned to take place during 2006.                                              
AUSTRALIAN PROJECTS                                                             
PILBARA - BLACKTOP PROJECT                                                      
(Operated  by  Tawana.50%  owned  by  Tawana  and  50%  by  De  Beers  Australia
Exploration Limited)                                                            
In  October 2005, the Company entered into a joint venture with De Beers,  which
included  the  Pilbara  Blacktop  Project  in  which  De  Beers  had  previously
discovered the Blacktop kimberlite fissure.                                     
The  only  bulk  sample (32.85t) taken by De Beers from the Blacktop  kimberlite
produced 135 diamonds weighing 5.27 ct.                                         
A  20tph  DMS  plant  has been secured to facilitate the bulk  sampling  of  the
Blacktop  kimberlite  during the 2006 dry season.  It  is  proposed  to  process
approximately 14,000 tonnes of kimberlite through this plant and to examine  the
resultant  concentrate  in  the  Company"s  laboratory.  If  the  grade  of  the
kimberlite  is similar to the initial sample, the planned program could  produce
sufficient diamonds to support an analysis of the economic viability  of  mining
the Blacktop kimberlite.                                                        
*Note; The Company considers that any tonnage and grade estimates in this report
do  not satisfy the definition of a Mineral Resource as set out in the JORC Code
as  insufficient work has been conducted to be able to determine the  grade  and
tonnage  of  the  deposit with greater accuracy.  Further work may  or  may  not
establish  a  Mineral Resource on the property.  Accordingly,  the  estimate  of
grade  is  released  as provided by paragraph 18 of the JORC  Code  of  2004  in
relation  to  an  exploration target or exploration potential.   The  kimberlite
sample was crushed and concentrated in the -8.0+1.0mm fraction by proprietary De
Beer"s  methods  and diamonds were recovered in the +11 to -1  standard  diamond
sieve sizes.                                                                    
PILBARA - EXPLORATION PROJECT                                                   
(Operated  by  Tawana.50%  owned  by  Tawana  and  50%  by  De  Beers  Australia
Exploration Limited)                                                            
A  helicopter supported sampling program was completed during the fourth quarter
of  2005 during which 304 samples were collected over areas in which previous De
Beers"  sampling  had identified kimberlitic indicator mineral anomalies  during
previous  sampling programs.  These samples are being processed in the Company"s
laboratory during the first quarter of 2006.                                    
It  is  proposed  to  allocate  $1.3 million over 2006/2007  for  the  continued
exploration in the Pilbara region.  These funds will also be used to bulk sample
any additional kimberlites discovered during that period.                       
WHIRLWIND PLAINS PROJECT, NORTHERN TERRITORY                                    
(100% owned by Tawana)                                                          
The Whirlwind Plains Project covers 500 square kms and are located in the       
Northern Territory some 200km from the Western Australian border.  A ground-    
based gravity survey was conducted over an area of the project to test the      
hypothesis that several ancient river channels exist in this area.              
Previously, De Beers had sampled outcrops of gravels on Whirlwind Plains during 
the late 1980"s and recovered diamonds from several locations.  A recent        
examination of these diamonds by Tawana has showed that at least four           
populations of diamonds are present and that the diamonds are not solely derived
from the Company"s Timber Creek kimberlites located 20km to the east.  In       
essence, this means that diamonds have been deposited into the ancient gravels  
from several sources, which could increase the chances of locating diamond      
deposits in the project area of economic potential.                             
More detailed gravity surveys will be conducted during 2006 to identify         
favourable drill sites.                                                         
TIMBER CREEK PROJECT, NORTHERN TERRITORY.                                       
(100% owned by Tawana)                                                          
The Timber Creek Project, which was originally acquired from De Beers, comprises
a cluster of 5 kimberlitic intrusions and the surrounding potential for alluvial
diamond placers.                                                                
No substantial work was conducted on this project during 2005.                  
FLINDERS ISLAND PROJECT, SOUTH AUSTRALIA                                        
(80% owned by Tawana and 20% owned by Orogenic Exploration)                     
Flinders Island is some 39 kms2 in extent situated 28 kms west of the Eyre      
Peninsula of South Australia.  The island is formed of granite and is covered by
some 10 meters to 30 meters of younger sediments and sands.                     
Results from earlier soil sampling and drilling has shown an abundance of       
kimberlitic minerals from surface to the bedrock contact, at approximately 15m  
below surface in a defined area in the northern part of the island.             
EYRE PENINSULA PROJECT, SOUTH AUSTRALIA                                         
(80% owned by Tawana and 20% owned by Orogenic Exploration)                     
Results of chemical analyses of kimberlitic indicator minerals recovered from   
samples in this project area show a high percentage of picroilmenites displaying
chemical attributes which are characteristic of minerals associated with diamond
bearing kimberlites.                                                            
Follow up sampling was conducted late in 2005 and results are awaited.          
Financial Results                                                               
INCOME STATEMENT                                                                
Year Ended 31 December 2005                                                     
Consolidated                     Parent             
                              2005           2004           2005           2004 
                                 $              $              $              $ 
Continuing                                                                      
Operations                                                                      
Revenue                    187,040        245,466        187,040        227,792 
Expenses                                                                        
Exploration            (2,144,826)       (98,770)    (2,042,897)       (23,794) 
expenses written                                                                
off                                                                             
Finance costs            (164,152)       (27,092)      (144,896)       (20,501) 
Currency                 (371,329)        452,075         12,012        (4,032) 
gains/(losses)                                                                  
Gain/(Loss) on sale              -        235,976              -      (914,107) 
of controlled                                                                   
entity                                                                          
Corporate Costs          (513,309)      (118,503)      (513,309)      (118,503) 
Employee benefits        (928,806)      (869,873)      (351,984)              - 
expense                                                                         
Travel costs             (343,456)      (216,658)      (103,525)       (93,907) 
Depreciation             (656,507)     (304,958))      (115,714)      (113,636) 
Impairment of                    -              -    (1,119,897)      (848,833) 
investments                                                                     
Administration           (762,251)      (551,867)      (612,517)      (436,060) 
expenses                                                                        
Loss from              (5,697,596)    (1,254,204)    (4,805,687)    (2,345,581) 
continuing                                                                      
operations before                                                               
income tax expense                                                              
Income Tax expense               -              -              -              - 
Loss from              (5,697,596)    (1,254,204)    (4,805,687)    (2,345,581) 
continuing                                                                      
operation after                                                                 
income tax expense                                                              
Net Loss / (Gain)                -         20,005              -              - 
attributable to                                                                 
Outside Equity                                                                  
Interest                                                                        
Loss for the year      (5,697,596)    (1,234,199)    (4,805,687)    (2,345,581) 
attributable to                                                                 
members of the                                                                  
parent                                                                          
Earnings per share                                                              
for continuing                                                                  
operations                                                                      
Basic earnings per         (0.095)        (0.029)                               
share                                                                           
Diluted earnings           (0.095)        (0.029)                               
per share                                                                       
BALANCE SHEET                                                                   
As at 31 December 2005                                                          
                            Consolidated                     Parent             
2005           2004           2005           2004 
                                 $              $              $              $ 
Current Assets                                                                  
Cash and cash           1,340,481      3,040,461     1,152,797        2,933,728 
equivalents                                                                     
Trade and other           706,608       1,080,578      263,837        933,071   
receivables                                                                     
Inventories                54,039          11,974            -              -   
Total Current           2,101,128       4,133,013    1,416,634      3,866,799   
Assets                                                                          
non-current assets                                                              
Receivables                61,324          57,877            -              -   
Other financial                 -        263,575     5,592,973        3,914,894 
assets                                                                          
Property, plant and     3,859,985       1,915,494    2,610,779        676,492   
equipment                                                                       
Exploration             9,749,360       9,618,085    7,109,772      7,615,188   
expenditure                                                                     
Total Non-current      13,670,669      11,855,031   15,313,524     12,206,574   
Assets                                                                          
Total Assets           15,771,797    15,988,044       16,730,158   16,073,373   
Current Liabilities                                                             
Trade and other           158,607       149,174           93,434      111,605   
payables                                                                        
Provisions                 13,427        54,847                -            -   
Total Current             172,034         204,021       93,434        111,605   
Liabilities                                                                     
Non-Current                                                                     
Liabilities                                                                     
Interest Bearing            2,577             -            7,692        7,692   
Liabilities                                                                     
Total Non-Current           2,577               -        7,692          7,692   
Liabilities                                                                     
Total Liabilities         174,611       204,021          101,126      119,297   
Net Assets             15,597,186    15,784,023       16,629,032   15,954,076   
equity                                                                          
Issued capital         25,880,021    20,361,252       25,880,021   20,361,252   
Reserves                (156,547)     (148,537)           22,884       61,010   
Accumulated Losses   (10,126,288)   (4,428,692)      (9,273,873)  (4,468,186)   
Total Equity           15,597,186    15,784,023       16,629,032   15,954,076   
CASH FLOW STATEMENT                                                             
Year Ended 31 December 2005                                                     
                            Consolidated                     Parent             
                              2005           2004           2005           2004 
$              $              $              $ 
Cash Flows from                                                                 
Operating                                                                       
Activities                                                                      
Receipts from                    -          9,935              -             -  
customers                                                                       
Interest received           81,460        201,022         81,460        201,022 
Miscellaneous               11,110         33,205         11,110         26,770 
income                                                                          
Interest expense         (164,152)       (27,092)      (144,896)       (20,501) 
Payments to            (2,453,987)    (1,946,577)      (782,261)      (820,978) 
suppliers and                                                                   
employees                                                                       
Net Cash               (2,525,569)    (1,729,507)      (834,587)     (613,687)  
Inflow/(Outflow)                                                                
from Operating                                                                  
Activities                                                                      
Cash Flows from                                                                 
Investing                                                                       
Activities                                                                      
Purchase of fixed      (2,600,998)    (1,510,868)    (2,050,000)       (18,298) 
assets                                                                          
Sale/(Purchase) of         319,919      (225,449)        319,919      (225,449) 
shares                                                                          
Payments for           (2,276,101)    (3,919,702)    (1,537,480)    (2,577,906) 
exploration                                                                     
Advances to related              -              -    (3,061,551)    (3,936,010) 
bodies corporate                                                                
Sale of fixed                    -            657              -            657 
assets                                                                          
Net Cash                                                                        
Inflow/(Outflow)       (4,557,180)    (5,655,362)    (6,329,112)    (6,757,006) 
from Investing                                                                  
Activities                                                                      
Cash Flows from                                                                 
Financing                                                                       
Activities                                                                      
Proceeds from Share      5,382,769      5,729,635      5,382,769      5,729,637 
Issues (net)                                                                    
Net Cash                                                                        
Inflow/(Outflow)         5,382,769      5,729,635      5,382,769      5,729,637 
from Financing                                                                  
Activities                                                                      
Net Increase           (1,699,980)    (1,655,234)    (1,780,931)    (1,641,056) 
(Decrease) in Cash                                                              
and cash                                                                        
equivalents                                                                     
Cash and cash            3,040,461      4,695,695      2,933,728      4,574,784 
equivalents at                                                                  
beginning of                                                                    
financial year                                                                  
Cash and cash            1,340,481      3,040,461      1,152,797      2,933,728 
equivalents at end                                                              
of financial year                                                               
The financial report complies with Australian Accounting Standards, which       
include Australian equivalents to International Financial Reporting Standard    
(`AIFRS").  Compliance with AIFRS ensures that the financial report, comprising 
the financial statements and notes thereto, complies with International         
Financial Reporting Standards (`IFRS").                                         
This is the first financial report prepared based on AIFRS and comparatives for 
the year ended 31 December 2004 have been restated accordingly.                 
The financial statements have been audited by Frank Spencer, Chartered          
Accountant. The report of the auditors is available for inspection at the       
Company"s registered office.                                                    
Share Capital                                                                   
During the year the Company allotted 2,204,545 ordinary shares as a result of   
the exercise of options which were exercisable on or before 30 November 2005.   
The funds raised of $1,653,377 were applied towards the ongoing exploration     
activities of the company and to provide additional working capital.            
In addition the Company allotted 2,002,134 ordinary shares at 75 cents each and 
3,712,985 ordinary shares at 60 cents each, raising a total of $3,729,392. The  
funds raised were applied towards the ongoing exploration activities of the     
company and to provide additional working capital.                              
The number of ordinary fully paid shares on issue at 31 December 2005 was       
65,609,529.                                                                     
Share Options                                                                   
During the year 170,000 options were issued to employees of the Company. These  
options were exercisable at 75 cents each on or before 30 November 2005.        
Also during the year, 2,204,545 options which were due to expire on or before 30
November 2005 were exercised at 75 cents each .The exercise of these options    
raised a total of $1,653,377. On 30 November 2005 a total of 16,238,205 options 
which were exercisable at 75 cents each on 30 November 2005 lapsed.             
A further 21,869,843 options were granted to shareholders registered on 15      
December 2005. These options are exercisable on or before 30 April 2008 at an   
exercise price of $1.00                                                         
The number of options on issue at 31 December 2005 the exercise price and the   
expiry date of the options are as follows:                                      
  * 21,869,843 options exercisable at $1.00 each on or before 30 April          
2008.                                                                      
The number of unissued ordinary shares under these options at the date of this  
report is 21,869,843                                                            
Corporate Directory                                                             
Directors                                                                       
Brian Phillips (Non- Executive Chairman)                                        
Wolfgang Marx (Managing Director)                                               
Leon Daniels (Executive Director)                                               
Euan Luff (Non-Executive Director)                                              
Company Secretary                                                               
Harry Hill                                                                      
Registered Office                                                               
60 Wilson Street                                                                
South Yarra                                                                     
Melbourne Vic 3141                                                              
Telephone:  (03) 9863 5222                                                      
Facsimile:  (03) 9863 5288                                                      
Email:  wolf.marx@tawana.com.au                                                 
Web Site www.tawana.com.au                                                      
Date: 31/03/2006 11:08:27 AM Supplied by www.sharenet.co.za                     
Produced by the JSE SENS Department                                             
                                                                                
                                                                                
                                                                                



                                        
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