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TAWANA RESOURCES NL - CANCELLATION OF S370941 Quarterly Activities Report for the Quarter to 31 March 2016

Release Date: 22/04/2016 15:32:59      Code(s): TAW       PDF(s):  
CANCELLATION OF S370941 Quarterly Activities Report for the Quarter to 31 March 2016

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
(“the Company” or “Tawana”)

                Quarterly Activities Report For the quarter to 31 March 2016


Mofe Creek Iron Ore Project
Project Studies - Mine, Logistics, Infrastructure and Approvals
-   The Mineral Development Agreement (MDA) for Tawana Resources NL’s (‘Tawana’ or
    ‘the Company’) 100% owned Mofe Creek project (the Project), incorporating both the
    northern and southern tenements and a potential early start-up project for Direct
    Shipping Ore (DSO), continues to be under review by Liberia’s Inter-Ministerial
    Concessions Committee (IMCC) and a response is anticipated in the June 2016 quarter.

-      Results received from the diamond drill program, consisting of six holes for 376.5m,
       have confirmed the presence of high grade Direct Shipping Ore (DSO) style
       mineralisation and high grade friable iron formation from the newly discovered
       Goehn Prospect.

-      Excellent results from XRF analysis included:
       o      GSEDD04; 14m @ 61.1% Fe from 28m
       o      GSEDD01; 11m @ 60.2% Fe from 1m
       o      GSED03; 28m @ 51.5% Fe from 1m
              including 4m @ 63.3% Fe from 1m
       o      GSED05; 22m @ 54.5% Fe from surface
              including 12m @ 62.1% Fe from 3m

-      Drilling results and rock chip samples have identified a DSO zone over 500m of strike,
       a width of 100m and an average thickness of 15m.

-      Striking similarities between lithologies and mineralisation styles intersected at
       Goehn and typical Bomi Hills cross sections.

-      These results in conjunction with the MOU port services agreement with Wisco/CAD1
       (refer ASX Announcement on 18 May 2015) support the potential for a low cost DSO
       mining operation.
-     The Company is considering a range of potential options to unlock value for
      shareholders, including joint venture or outright sale options.

-   As at 31 March 2016, Tawana Resources had A$0.35 million in cash.
-   In January 2016, BlueRock Diamonds purchased the Company’s total shareholding and
    loan account in Diamond Resources (a 100% owned subsidiary of Tawana Resources NL)
    for ZAR 700,000 (A$60,300).
-   On 8 March 2016, the Company announced that it would undertake a one-for-twenty
    consolidation of its issued capital. This was approved by shareholders on 8 April 2016.
    Mofe Creek Iron Ore Project

Mineral Development Agreement (MDA)

The Company is awaiting a formal response from Liberia’s IMCC with regard to the first pass
submission of Tawana Liberia Inc.’s Mineral Development Agreement. A response is
anticipated in the June 2016 quarter.
The MDA is an agreement outlining the technical, commercial and
social/environmental commitments to be undertaken to build, operate and sustain
a project within Liberia, and is a legislative document passed as a bill in parliament
for a term of 25 years.

Infrastructure & Logistics
On 18 May 2015, Tawana and WISCO CAD (Hong Kong) Mining Company Limited (WISCO)
signed a non-binding memorandum of understanding (MoU)1 to negotiate in good faith, a
potential definitive Cooperation Agreement between the parties in relation to access and
use of WISCO CAD’s port facilities in the port of Freeport, Monrovia.
Negotiations are ongoing.


In February 2016, the Company announced that diamond drilling had confirmed the
presence of high grade DSO style hematite mineralisation, with iron grades up to
66% Fe, located a short trucking distance to the operating port of Freeport,
Six diamond drill holes (376.5m) were drilled over the north east section of the
Goehn Prospect where there was a concentration of high grade Magnetite/Hematite
mineralisation mapped and samples reported an average grade of 66% Fe (Refer to
ASX Announcement of 8 July 2015)2.

The six holes were drilled across two lines 200m apart on nominal 50m drill spacing.
The program was designed to test at depth the identified DSO and high grade friable
iron formation from previous field work. The program was successful as all the holes
intersected either DSO or high grade friable iron formation or a combination of both,
see Figure 4.
The core was processed on site with assays taken every meter by a hand held XRF
machine with appropriate QAQC procedures followed. Table 2 lists all significant
assay results from the six drilled holes.

Table 1. Drill program for Goehn prospect3

   Hole ID       Hole Type            East       North          RL         Dip     Azimuth   Hole depth
 GSEDD01          NQ core          269,303      755,744         107        -50      330          40
 GSEDD02          NQ core          269,337      755,694         96         -50      330          66
 GSEDD03          NQ core          269,431      755,856         93         -50      305         53.4
 GSEDD03A         NQ core          269,431      755,847         92         -60      305         77.4
 GSEDD04          NQ core          269,397      755,879         110        -50      305         68.4
 GSEDD05          NQ core          269,361      755,910         112        -50      125         71.3
Co-ordinate system: UTM WGS84 Zone 29N

Table 2. Significant assay results3

 Hole ID          Depth      Depth      Intersection   Fe %       Si %      Al %      P%        S%
                From (m)     To (m)         (m)
 GSEDD001           1          12            11          60.2        1.8    6.3       0.03      0.04
                   20          36            16          45.0        4.4    5.7       0.03      BDL
 GSEDD002           3          14            11          50.9        2.1    4.7       0.01      BDL
                   27          45            18          44.9        5.2    5.2       0.02      BDL
                   51          66            15          44.5        3.2    1.6       0.02      0.08
 GSEDD003           1          29            28          51.5        1.1    1.4       BDL       BDL
 including          1           5             4          63.3        0.6    0.8       BDL       BDL
 GSEDD003A       surface       11            11          52.9        1.7    2.2       BDL       BDL
 including          1           5             4          60.9        1.4    1.7       BDL       BDL
 GSEDD004           2          20            18          51.2        1.3    1.9       BDL       BDL
 including          4           9             5          59.0        0.8    1.3       BDL       BDL
                   28          42            14          61.1        0.9    1.3       BDL       BDL
                   49          62            13          51.7        1.0    0.7       BDL       BDL
 GSEDD005        surface       22            22          54.5        1.6    2.0       BDL       BDL
 including          3          15            12          62.1        1.4    1.8       BDL       BDL
                   26          35             9          52.1        1.9    3.1       BDL       BDL
 including         31          34             3          62.1        1.8    3.2       BDL       BDL
                   41          48             7          55.0        2.0    2.3       BDL       BDL
 including         45          48             3          63.6        1.8    2.1       BDL       BDL
                   50          66            16          49.8        1.2    1.4       BDL       BDL
Note: All results reported using a handheld XRF machine and are considered semi-quantative in
nature. BDL = Below detection limit.

Bomi Hills Analogue and Significance of Drilling Program
Initial geological observations from drilling at the Goehn Prospect highlights the
similarities in lithology and mineralisation setting as reported at the Bomi Hills mine.

The Goehn Prospect is along strike from the abandoned Bomi Hills iron ore mine
which was in production from 1951 to 1977. Historic production at Bomi Hills is
poorly documented; however estimated historic production by the Government of
Liberia is 50Mt of high-grade DSO lump magnetite in addition to high-grade
beneficiated sinter feed concentrate. DSO magnetite averaged 64.5% Fe, 4.5% SiO 2,
1.5% Al2O3 and 0.13% P, of which 53% formed lump material (average 11-37mm) and
47% formed fines (<11mm). Friable iron formation was beneficiated through
Humphrey Spirals and a magnetic separator to produce sinter feed concentrate
averaging 64% Fe, 6% SiO2 and 0.04-0.05% P (Gruss, 1973).

The genesis of the Bomi Hills magnetite deposit is not clearly understood, however,
general consensus is that it is hypogene and represents an itabirite that has come
into direct contact with rising gneissic fronts causing enrichment to coarse massive
magnetite by metamorphic differentiation (Gruss, 1973). Magnetite mineralisation
is in direct contact with gneissic basement and is partially blind.

The Bomi Hills cross section at figure 5 has striking similarities between the
lithologies intersected at Goehn (Refer Figure 4).
Drilling at Goehn has intersected a similar package of friable iron formation
transitioning into hard iron formation from surface, through mafic schist and into
footwall gneiss basement. DSO has been intersected within and directly below the
mafic schists over variable widths and to a current average of 15m.

Potential DSO Start Up
The DSO mineralisation defined within the Goehn Prospect falls within 6km of the
bitumen road between the Mofe Creek Project area and the operational port of
Monrovia; only 85km away (Refer Figure 1). This new discovery represents a strategic
opportunity to structure an early-start-up operation with minimal capital intensity,
using the existing highway and a working port within Monrovia. The mineralisation
is readily accessible and presents from surface.
The Goehn Prospect also supports the opportunity for a potential early start-up, low-
capital intensity mining and trucking operation within the initial years of production
and project life cycle. Due to the hematite DSO style mineralisation discovered, a
beneficiation process may not be required at start-up and will only be introduced as
the mineralisation transitions from DSO into friable itabirite mineralization. This
mining methodology ensures the delayed capital requirements of a processing
facility and allows the wet plant to be potentially funded from cashflow and/or
strategic debt, once the Company is operational and generating an income.
This potential development is further enhanced by the infrastructure sharing MoU
executed between the Company and WISCO-CAD; the owner-operator of the
Monrovia port iron ore handling facilities (refer ASX announcement of 18 May 2015).


Cash and Fiscal Management
As at 31 March 2016, Tawana Resources held $0.35 million in cash as a number of
redundancy and residual termination payments were made during the quarter. Refer
to the Appendix 5B (ASX website) for principal movements in cash for the quarter
which included PAYG on termination payments that were made.
The Company has diligently continued to reduce corporate and Liberian expenditure
while advancing the Project’s principal activities.
The Directors are currently reviewing a range of financing options which may include
the further issue of new equity.

Share Consolidation
On 8 March 2016, the Company announced that it would undertake a one-for-twenty
consolidation of its issued capital. The consolidation will create a more efficient and
streamlined capital structure resulting in the shares on issue being reduced from
approximately 1,475.3 million to 73.8 million.

All outstanding options will be consolidated on the same ratio which will result in a
total of 1.12 million options on issue.

Shareholders approved the share consolidation on 8 April 2016. The Company is
currently trading on a deferred settlement basis (ASX code: TAWDA) and expects to
commence trading on a normal T+2 basis on 22 April 2016.

Share Consolidation
In January 2016, BlueRock Diamonds purchased the Company’s total shareholding
and loan account in Diamond Resources (a 100% owned subsidiary of Tawana
Resources NL) for ZAR 700,000 (A$60,300). The Company received its first
installment of A$25,000 in February 2016.

Corporate Opportunities
In conjunction with the strategic advancement of the Mofe Creek iron ore project,
the company continued a process of reviewing Australian-based resource commodity

About Tawana (ASX & JSE: TAW)

Tawana Resources NL is an ASX and JSE-listed Company with its principal project in
Liberia, West Africa. Tawana’s 100% owned Mofe Creek Iron ore Project lies 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 realising value from the Mofe Creek project, which covers
475km2 of highly prospective tenements in Grand Cape Mount County, with all options
open to consideration including potential joint venture or royalty positions with third
parties. The Project hosts DSO and high-grade friable itabirite mineralisation which can
be upgraded to a superior quality iron ore product in the 64-68% Fe grade range.

Michael Naylor
Executive Director
Tel +61 8 9489 2600

Detailed information on all aspects of Tawana’s projects can be found on the
Company’s website www.tawana.com.au

22 April 2016
Sponsor PricewaterhouseCoopers Corporate Finance (Pty) Ltd

Competent Persons Statement
The information in this report that relates to Exploration Results and Resources is based on information compiled
by Shane Tomlinson, who is a member of the Australian Institute of Geoscientists. Shane Tomlinson 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’. Shane Tomlinson
consents to the inclusion of the matters in this report based on his information in the form and context in which
it appears.

Forward Looking Statement
This report may contain certain forward looking statements and projections regarding estimated, resources and
reserves; planned production and operating costs profiles; planned capital requirements; and planned strategies
and corporate objectives. Such forward looking statements/projections are estimates for discussion purposes
only and should not be relied upon. They are not guarantees of future performance and involve known and
unknown risks, uncertainties and other factors many of which are beyond the control of Tawana Resources NL.
The forward looking statements/projections are inherently uncertain and may therefore differ materially from
results ultimately achieved.

Tawana Resources NL does not make any representations and provides no warranties concerning the accuracy of
the projections, and disclaims any obligation to update or revise any forward looking statements/projects based
on new information, future events or otherwise except to the extent required by applicable laws. While the
information contained in this report has been prepared in good faith, neither TAW or any of its directors, officers,
agents, employees or advisors give any representation or warranty, express or implied, as to the fairness,
accuracy, completeness or correctness of the information, opinions and conclusions contained in this
presentation. Accordingly, to the maximum extent permitted by law, none of TAW, its directors, employees or
agents, advisers, nor any other person accepts any liability whether direct or indirect, express or limited,
contractual, tortuous, statutory or otherwise, in respect of, the accuracy or completeness of the information or
for any of the opinions contained in this presentation or for any errors, omissions or misstatements or for any
loss, howsoever arising, from the use of this presentation.

    1   Disclaimer:
          (i)      the MOU represents a non binding intention of the parties to negotiate a formal cooperation
                   agreement in good faith. The parties are yet to agree on any definitive operational,
                   commercial and/or legal terms (including tonnage capacity or delivery schedules) for the
                   cooperation agreement;
          (ii)     the obligation to negotiate in good faith comes to an end on the earlier of execution of a
                   definitive cooperation agreement or 31 December 2015; and
          (iii)    there is no certainty or assurance that parties will reach a final agreement on the terms of the
                   cooperation agreement.
          (iv)     Refer to ASX announcement on 18 May 2015 for further information.
2 Tawana is not aware of any new information or data that materially affects the information included in the
said announcement.

3Refer ASX ANnouncment on 18 February 2016. Tawana is not aware of any new information or data that
materially affects the information included in the said announcement.

Appendix 1 | Tawana Resources NL Tenements
  Tenement                                     Location                          Structure

  MEL-12029                                                                      100% Tawana Resources through its 100%
  Mofe Creek                                                                     owned Liberian subsidiary
  MEL-1223/14                                                                    100% Tawana Resources through its 100%
  Mofe Creek Sth                                                                 owned Liberian subsidiary

Mining Tenements disposed: Nil
Beneficial percentage interests held in farm-in or farm-out agreements: Nil
Beneficial percentage interests in farm-in or farm-out agreements acquired or disposed: Nil

                                                      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                                                                        31 March 2016

Consolidated statement of cash flows
                                                                              Current quarter              Year to date
Cash flows related to operating activities                                    $A’000                       (3 months)
1.1       Receipts from product sales and related debtors                                           -                        -

1.2       Payments for     (a) exploration & evaluation                                           (63)                     (63)
                           (b) development                                                          -                        -
                           (c) production                                                           -                        -
                           (d) administration                                                    (398)                    (398)
1.3       Dividends received                                                                        -                        -
1.4       Interest and other items of a similar nature
          received                                                                                  3                        3
1.5       Interest and other costs of finance paid                                                  -                        -
1.6       R&D refund                                                                                -                        -
1.7       Other                                                                                     -                        -

          Net Operating Cash Flows                                                               (458)                    (458)

          Cash flows related to investing activities
1.8       Payment for purchases of:
                         (a) prospects                                                              -                        -
                         (b) equity investments                                                     -                        -
                         (c) other fixed assets                                                     -                        -
1.9       Proceeds from sale of:
                         (a) prospects                                                             -                        -
                         (b) equity investments                                                   25                       25
                         (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                                                25                         25
1.13    Total operating and investing cash flows
        (carried forward)                                                    (433)                        (433)

1.13    Total operating and investing cash flows
        (brought forward)                                                    (433)                        (433)

        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 – share issue costs                                                -                           -
                                                                                 -                           -
        Net financing cash flows

        Net increase (decrease) in cash held                                 (433)                        (433)

1.20    Cash at beginning of quarter/year to date                             788                         788
1.21    Exchange rate adjustments to item 1.20                                  2                           2
                                                                              357                         357
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

1.23     Aggregate amount of payments to the parties included in item 1.2               189

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, termination payments (withholding tax paid for Wayne Richards termination
         payment of $139,000), director 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


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

Financing facilities available
Add notes as necessary for an understanding of the position.

                                                                 Amount available          Amount used
                                                                 $A’000                    $A’000
3.1    Loan facilities                                                                -                             -

3.2    Credit standby arrangements                                                    -                             -

Estimated cash outflows for next quarter
4.1    Exploration and evaluation                                                                          151

4.2    Development                                                                                              -

4.3    Production                                                                                               -

4.4    Administration                                                                                         138

       Total                                                                                                  289

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                                                   357                       788
                                                                                      -                         -
 5.2     Deposits at call
                                                                                      -                         -
 5.3     Bank overdraft
                                                                                      -                         -
 5.4     Other (provide details)
                                                                                    357                       788
         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
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                       -                        -

7.2       Changes during
7.3       +Ordinary securities             1,475,250,387            1,475,250,387
7.4       Changes during
          (a) Increases through
          (b) Decreases
          through returns of
          capital, buy-backs
7.5       +Convertible debt

7.6       Changes during
7.7       Options                                                                       Exercise price       Expiry date
          Unlisted options                 1,500,000                -                   $0.015               12 December 2016
          Unlisted options                 10,000,000               -                   $0.018               12 December 2016
          Unlisted options                 11,000,000                                   $0.0089              26 May 2018
7.8       Issued during quarter            -                        -                   -                    -
7.9       Exercised during                 -                        -                   -                    -
7.10      Expired during                   1,000,000                -                   $0.039               20 January 2017
          quarter                          2,000,000                -                   $0.004               7 July 2018

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

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

Sign here:         ............................................................   Date: 22 April 2016
                        Company secretary

Print name:        Michael Naylor

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

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

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

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

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

                                      == == == == ==

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