Quarterly Activities Report December 2018€¦ · Office Level 4, 360 Collins Street, Melbourne VIC...
Transcript of Quarterly Activities Report December 2018€¦ · Office Level 4, 360 Collins Street, Melbourne VIC...
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 1 / 13
ASX / MEDIA ANNOUNCEMENT ASX: NCZ
Quarterly Activities Report December 2018
Processing Plant
• Processing plant load commissioning and ramp up continuing, with strong progress
made in overall plant availability and stability during Q4 2018
• Consistent progressive increase in zinc and silver recoveries through the quarter
• Operations now regularly achieving 40-45% total zinc recovery (~70% of overall
target nameplate recovery), with up to 49% total zinc recovery recently achieved
• Quarterly production of 25,500t of zinc concentrate from tailings operations at a
grade averaging 47.0% Zn, 7.5% Pb, 6.5% SiO2 & 150g/t Ag
• Continued improvement in overall grade, with operations now consistently above
the average Q4 2018 grade, producing a 47% - 51% zinc concentrate
• The progressive improvements in both recovery & grade during the quarter has
resulted in a 55% increase in the average monthly production rate of zinc metal
• New Century is now targeting continued progression toward full nameplate plant
recoveries in Q2 2019
Shipping & Sales
• Total 25,000t of zinc concentrate shipments to date (China & Europe)
• China shipping & sales:
� First shipment into China (11,000t) completed
� Further spot sales into China under contract, with next shipment (22,000t)
scheduled for March 2019 and monthly shipments anticipated to follow
� Total 40,000t to date in sales to China completed or under contract
• Europe shipping & sales:
� First spot sale & ship loading of zinc concentrate for Europe (14,000t) complete
� Further European spot sale under contract (11,000t - shipment February 2019)
� Total 25,000t to date in sales to Europe completed or under contract
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 2 / 13
� Initial European shipment represents the first zinc concentrate delivered to
New Century’s current long term offtake partners
Hydraulic Mining
• Mining ramp up continuing, with improved operational stability during Q4 2018
• Implementation of a third mining cannon and an additional pump train underway,
targeting production increase to a minimum 8Mtpa and up to 10Mtpa
• Continued strong reconciliation of mining grade to the ore reserve model, with the
ore grade mined during Q4 2018 averaging 2.95% Zn
• New Century is targeting an overall hydraulic mining development timeline of Phase
1 mining rate (8Mtpa) by the end of Q1 2019 and full ramp up to Phase 2 mining rate
(15Mtpa) by end of 2019
Other
• The Expansion PFS, which is assessing potential for development of insitu zinc &
lead resources, now due for completion at the end of Q1 2019, in line with
completion of Phase 1 ramp up of tailings mining rate
• Completion of A$40M senior secured debt facility with NAB
New Century Resources Limited (Company or New Century) (ASX:NCZ) is pleased to provide an
update on load commissioning and operational ramp up at Century during Q4 2018.
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 3 / 13
Operational Developments
Processing Plant
• Plant load commissioning and operational ramp up continued throughout Q4 2018, with a
progressive increase in all aspects of production, including metal recovery, concentrate
tonnage and overall product quality
• Consistent increase in zinc and silver recoveries throughout Q4 2018, with the operations now
regularly achieving 40-45% total zinc recoveries (i.e. ~70% of overall target nameplate
recovery) and up to 49% total zinc recovery recently achieved
• Continued improvement in rougher/scavenger recovery, which is now achieving up to full
target nameplate recovery
• Continued program of bottleneck removal in the cleaner circuit, with the first implemented
initiatives already providing a step change in recovery performance
• Q4 2018 concentrate production of 25,500t at 47.0% Zn, 7.5% Pb, 6.5% SiO2 and 150g/t Ag
• Progressive load commissioning process and plant improvements initiatives have resulted in the
average monthly production rate of zinc metal increasing by over 55% during the quarter
During the quarter the Company continued the process of plant load commissioning and operational
ramp up. Strong progress to overall plant availability and stability has been made to date, which is
reflected in continued improvements to all production metrics including the operations now
regularly achieving 40-45% total zinc recovery (~70% of overall target nameplate recovery).
Figure 1: Century’s processing plant ramp up performance against other ASX listed start-up operations through
to the end of Q4 2018 (Source: public company data & Credit Suisse estimates)
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 4 / 13
As shown in Figure 2 below, within the overall recovery increase achieved to date, the individual
circuits all continue to improve, via:
• the rougher/scavenger circuit now achieving up to 100% of target nameplate recovery (i.e.
up to 70% of total zinc in the feed recovered into the rougher/scavenger concentrate); and
• the first initiatives associated with the progressive removal of bottlenecks in the cleaner
circuit providing a step change in recovery performance.
The performance of the rougher/scavenger circuit achieving up to 70% total recovery of zinc from
the plant feed is significant, in that only zinc recovered by this circuit can ultimately report to final
product after the cleaning stage.
Figure 2: Flowsheet of operations at the Century Zinc Mine annotated for the current performance of each unit process during the course of the load commissioning process
The plant operations team is also targeting progressive improvement in concentrate quality toward
New Century’s target long term steady state concentrate specification (see Figure 5). During the
quarter, the Company continued to improve the stability of concentrate quality, producing saleable
commissioning grade concentrate averaging 47.0% Zn, 7.5% Pb and 6.5% SiO2 and 150g/t Ag.
The overall grade has continued to improve throughout the quarter, with the operations now above
the average Q4 2018 grade, consistently producing a 47% - 51% zinc concentrate.
As discussed in the ‘Shipping & Sales’ section of this report, the Company has experienced strong
demand for its current commissioning grade concentrate to date, which is anticipated to continue
as concentrate quality improves through the load commissioning process.
Focus for the plant during Q1 2019 remains on maintaining plant uptime and steady state
operations, while continuing the implementation of process improvements, in particular those
associated with the cleaner circuit.
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 5 / 13
Figures 3 & 4: Cleaner 1A operational and 1B now online (left) & installation of pipe racks as part of the
refurbishment and upgrade of launder spray and reagent dosing systems (right)
New Century Steady State Specification
New Century Commissioning Specification
McArthur River
(Glencore)
Dugald River (MMG)
Gamsberg (Vedanta)
Red Dog (Teck)
Zn 51 - 54.5 % 46 - 50 % 47% 52% 50% 55.6%
Fe 0.8 - 2.0 % 1.5 - 4.5 % 5.9% 11.0% 8.9% 5.0%
Mn <0.15 % <0.15 % <0.01 % 2.0% 2.6% <0.01 %
SiO2 5.0 - 7.5 % 3.0 - 7.0 % 4.6% 3.5% 2.0% 4.5%
C 3.0 - 5.0 % 3.0 - 5.0 % <0.1% <0.1% 0.2% <0.1%
Cd 0.08 - 0.15 % 0.08 - 0.15 % 0.12% <0.1 % <0.1 % 0.4%
As <0.01 % <0.01 % 0.20% 0.02% <0.01 % 0.02%
Hg <50 ppm <50 ppm 40 ppm 15 ppm 22 ppm 80 ppm
Cu <0.6 % <0.6 % 1.1% 0.2% 0.1% 0.2%
Pb 1.2 - 3.0 % 6.0 - 10.0% 4.6% 0.2% 0.1% 3.8%
S 27 - 30 % 27 - 30 % 30.0% 31.0% 29.4% 31.7%
Ag 50 - 250 ppm 100 - 200 ppm 130 ppm 80 ppm 2 ppm 150 ppm
Figure 5: Peer concentrate comparison of New Century’s current commissioning concentrate and targeted steady
state specification (Source: Wood Mackenzie, August 2018, note peer concentrate specifications are indicative
only and may not represent current concentrate qualities)
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 6 / 13
Shipping & Sales
• First shipment of 11,000t of New Century concentrate into China complete
• Further subsequent spot sale contracts into China in place & first spot sales into Europe
• Total 25,000t of shipments completed to date
• Shipments into Europe include the first purchase and delivery of zinc concentrate to New
Century’s existing long term offtake partners
During the quarter, the Company continued to ramp up activities associated with its concentrate
slurry pipeline, port facility and transhipment vessel, culminating in the successful restart of
regular concentrate shipments from the mining operations.
To date 25,000t of zinc concentrate produced from the operations has been shipped, with exports
destined for smelters in both China and Europe. The first shipment to China has been completed
and the second shipment has been loaded and is en-route to Europe.
Completed shipments to date have received no penalties for lead or carbon and only an immaterial
penalty for silica. Table 1: New Century current and projected shipping metrics
Date Contracted Shipments (delivered or scheduled)
China Europe
Q3 2018 - -
Q4 2018 11,000t 14,000t*
Q1 2019 22,000t 11,000t
Total 33,000t 25,000t
* Shipment loading and payment completed early January 2019
The Company has received continued strong demand for its current commissioning grade
concentrate, with 33,000t of Q1 2019 production already under sales contract.
Regular spot sales into China have been achieved via pre-payment contracts, with 11,000t of
40,000t delivered into those contracts to date. The next shipment into China (22,000t) is scheduled
for March 2019, after which regular monthly shipments are anticipated to follow.
Spot sales into Europe have been via CIF contracts, with 14,000t of 25,000t delivered into those
contracts to date. The next shipment into Europe is scheduled for February 2019, with production
of concentrate for this shipment nearing completion.
The first European shipment also represents the first sale to New Century’s long term offtake
partners. New Century continues to progress the overall concentrate quality towards its steady
state specification (see Figure 5), following which it anticipates regular supply to all existing long
term offtake partners.
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 7 / 13
Figure 6: First grab of New Century concentrate associated with the initial shipment into China
Figure 7: Discharge of New Century concentrate onto a port stockpile in China
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 8 / 13
Hydraulic Mining
• Hydraulic mining progressive ramp up continued throughout Q4 2018
• Mining grades reconciling strongly with the ore reserve model, averaging 2.95% Zn as expected
• Process underway for installation of a third cannon and an additional pump train, to boost the
overall mining rate consistently above 8Mtpa and up to 10Mtpa
During the quarter the Company continued the hydraulic mining ramp up toward the Phase 1
nameplate mining rate (8Mtpa), with the operations currently achieving a rate of up to 7.3Mtpa.
The mining grades during operations to date have reconciled strongly with the mine plan, averaging
2.95% Zn over the quarter.
Figure 8: Century’s hydraulic mining ramp up performance against other ASX listed start-up mining operations to
the end of Q4 2018 (Source: public company data & Credit Suisse estimates)
New Century’s mining contractors NPE are currently rolling out the installation of a third cannon
(currently two in operation) and an additional high pressure water pumping train in order to bring
the operation to a consistent rate above a minimum 8Mtpa and up to 10Mtpa.
The installation of the third cannon at the hydraulic mining operations forms part of the Company’s
existing planned overall expansion up to a 15Mtpa mining rate as part of the Phase 2 process (at
which time a total of five cannons are scheduled to be in operation).
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 9 / 13
The third cannon and pump train are targeted to be online by the end of Q1 2019. Other areas of
focus for the hydraulic mining operations for Q1 2019 are on maintaining consistent uptime, steady
state feed density and continuing the ramp up process.
Figures 9 & 10: Overview of hydraulic mining progress at the Century Mine
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 10 / 13
Expansion Prefeasibility Study Continuing
During the quarter the Company continued the Expansion PFS to investigate the incorporation of
Century’s existing in-situ Mineral Resources into the current tailings only mine plan.
As outlined in the Restart Feasibility Study (see ASX announcement 28 November 2017), once steady
operations at 8Mtpa have been achieved (Phase 1), the operations are scheduled to ramp-up in
Phase 2 to 15Mtpa on tailings via refurbishment of the remainder of the plant.
While the Company remains fully committed to the Phase 1 operational ramp up, it is assessing the
potential for an improved project value proposition via replacing the Phase 2 expansion on tailings
only to instead compliment the tailings operations with the introduction of in-situ Mineral Resources
on the mining lease (9.3Mt at 10.8% Zn + Pb & 66g/t Ag – see statement of JORC 2012 Resources &
Reserves in this report).
New Century considers that the PFS has the potential to increase the previously announced (tailings
only) 6.3-year mine life and 264,000tpa full scale zinc metal production. Different blending
strategies, as well as plant configurations, are being investigated to determine the optimum
pathway for zinc and lead production from the expanded operations.
Should New Century elect to expand operations via the insitu Mineral Resources, the Company will
refurbish the existing carbon and lead floatation circuits within the plant, enabling production of
separate zinc and lead concentrates as per historical operations.
Completion and release of the PFS has been delayed until the end of Q1 2019, with all resources of
the Company fully focused on the ramp up process for Phase 1 of the current tailings operations.
Once the completion of Phase 1 ramp up is at or nearing completion, the Company will finalise the
Expansion PFS, allowing the selected mine plan and plant configuration from the PFS to form the
basis of detailed design work. Pending the successful outcome of this work, the selected flow sheet
will then be progressively incorporated into site operations.
2018 Exploration IP Program
During the quarter, the Company completed its 2018 Exploration Program, with the focus being an
Induced Polarisation (IP) survey over a section of the Mining Lease considered prospective for
further Century style mineralisation.
Work completed to date has now formed the basis of drill planning of identified targets, which is
scheduled to occur in Q2 2019 on completion of the wet season.
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 11 / 13
Corporate Developments
Completion A$40M Debt Facility with NAB
During the quarter the Company completed a A$40M senior secured debt and bank guarantee facility
with National Australia Bank (ASX:NAB).
Provision of this facility followed an extensive process of technical, commercial and legal due
diligence by NAB and the facility is believed to represent the first project debt financing package
provided for a mine rehabilitation and tailings reprocessing operation by a ‘Big 4’ Australian bank.
Other Projects: Kodiak Coal Project (NCZ 70%)
The Kodiak Coal Project is currently on care and maintenance.
The Company continues to consider options with regard to the future of the Kodiak Coking Coal
Project in Alabama, USA, including assessing options in relation to financing, joint venture
opportunities or a disposal of the asset.
To learn more, please visit: www.newcenturyresources.com
For further information, please contact:
New Century Resources Media enquiries
Patrick Walta Shane Goodwin
Managing Director Head of Corporate Affairs
P: +61 3 9070 3300 P: +61 434 039 106
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 12 / 13
Statement of JORC 2012 Compliant Resources & Reserves
Mineral Resources
Tonnes (Mt)
Zn (%)
Pb (%)
Ag (g/t)
Zn (t) Pb (t) Ag (Oz)
South Block (Indicated)
6.1 5.3 1.5 43 322,000 90,000 8,550,000
Silver King (Inferred)
2.7 6.9 12.5 120 186,000 337,500 10,500,000
East Fault Block (Inferred) 0.5 11.6 1.1 48 60,000 5,500 800,000
TOTAL 9.3 6.1 4.7 66 568,000 433,000 19,850,000
Ore Reserves Tonnes (Mt)
ZnEq (%)
Zn (%)
Ag (g/t) Zn (t) Pb (t) Ag (Oz)
Century Tails (Proved) 77.3 3.1 3.0 12 2,287,662 - 29,734,819
Zinc Equivalent Calculation
ZnEq was calculated for each block of the Century Tailings Deposit from the estimated block grades.
The ZnEq calculation takes into account, recoveries, payability (including transport and refining
charges) and metal prices in generating a zinc equivalent value for each block grade for Ag and Zn.
ZnEq = Zn%+ + Ag troy oz/t*0.002573. Metal prices used in the calculation are: Zn US$3,000/t, and
Ag US$17.50/troy oz.
Competent Persons Statement
Mineral Resources
The information in this announcement that relates to Inferred Mineral Resources on the Silver King
Deposit and the East Fault Block Deposit was first reported by the Company in its prospectus
released to ASX on 20 June 2017, and the South Block Deposit was first reported by the Company
to the ASX on 15 January 2018. The Company confirms that it is not aware of any new information
or data that materially affects the information included in the original market announcements, and
in the case of estimates of Mineral Resources or Ore Reserves, that all material assumptions and
technical parameters underpinning the estimates in the relevant market announcement continue
to apply and have not materially changed. The Company confirms that the form and context in
which the Competent Person's findings are presented have not been materially modified from the
original market announcement.
Office Level 4, 360 Collins Street, Melbourne VIC 3000 Phone +61 (3) 9070 3300 Email [email protected] Website www.newcenturyresources.com 13 / 13
Ore Reserves
The information in this announcement that relates to the Ore Reserve at the Century Tailings
Deposit was first reported by the Company in its ASX announcement titled "New Century Reports
Outstanding Feasibility Results that Confirm a Highly Profitable, Large Scale Production and Low
Cost Operation for the Century Mine Restart" dated 28 November 2017. The Company confirms that
it is not aware of any new information or data that materially affects the information included in
the original market announcement, and in the case of estimates of Mineral Resources or Ore
Reserves, that all material assumptions and technical parameters underpinning the estimates in
the relevant market announcement continue to apply and have not materially changed. The
Company confirms that the form and context in which the Competent Person's findings are
presented have not been materially modified from the original market announcement.
Appendix 1:
The following information is provided pursuant to Listing Rule 5.3.3 for the quarter ended
31 December 2018:
Project Location Status Interest
Century Zinc Mine Queensland, Australia
ML 90058 Mt Isa Granted 100%
ML 90045 Mt Isa Granted 100%
EPM 10544 Mt Isa Granted 100%
EPM 26722 Mt Isa Granted 100%
EPM 26772 Mt Isa Granted 100%
EPM 26812 Mt Isa Granted 100%
EPM 26873 Mt Isa Granted 100%
EPM 26868 Mt Isa Application 100%
EPM 26874 Mt Isa Application 100%
EPM 26778 Mt Isa Application 100%
EPM 26976 Mt Isa Application 100%
Kodiak Coking Coal Project Alabama, USA
Coke Seam, Gurnee Property Shelby & Bibb Counties Lease 70%
Atkins Seam, Gurnee Property Shelby & Bibb Counties Lease 70%
Gholson Seam, Gurnee Property Shelby & Bibb Counties Lease 70%
Clark Seam, Gurnee Property Shelby & Bibb Counties Lease 70%
Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report
+ See chapter 19 for defined terms 1 September 2016 Page 1
+Rule 5.5
Appendix 5B
Mining exploration entity and oil and gas 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, 01/05/13, 01/09/16
Name of entity
NEW CENTURY RESOURCES LIMITED
ABN Quarter ended (“current quarter”)
53 142 165 080 31 DECEMBER 2018
Consolidated statement of cash flows Current quarter $A’000
Year to date (6 months) $A’000
1. Cash flows from operating activities
31,208 58,646 1.1 Receipts from customers
1.2 Payments for
(678) (3,356) (a) exploration & evaluation
(b) development (46,732) (85,242)
(c) production - -
(d) staff costs (4,041) (7,054)
(e) administration and corporate costs (2,188) (4,622)
1.3 Dividends received (see note 3) - -
1.4 Interest received 110 225
1.5 Interest and other costs of finance paid (1) (2)
1.6 Income taxes paid - -
1.7 Research and development refunds - -
1.8 Other (MMG support fees) (645) (1,297)
1.9 Net cash from / (used in) operating activities
(22,967) (42,702)
2. Cash flows from investing activities
- (407)
2.1 Payments to acquire:
(a) property, plant and equipment
(b) tenements (see item 10) - -
(c) investments - -
(d) other non-current assets - -
Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report
+ See chapter 19 for defined terms 1 September 2016 Page 2
Consolidated statement of cash flows Current quarter $A’000
Year to date (6 months) $A’000
2.2 Proceeds from the disposal of:
549 549 (a) property, plant and equipment
(b) tenements (see item 10) - -
(c) investments - -
(d) other non-current assets 1,680 2,200
2.3 Cash flows from loans to other entities - -
2.4 Dividends received (see note 3) - -
2.5 Other - -
2.6 Net cash from / (used in) investing activities
2,229 2,342
3. Cash flows from financing activities
- - 3.1 Proceeds from issues of shares
3.2 Proceeds from issue of convertible notes - -
3.3 Proceeds from exercise of share options - -
3.4 Transaction costs related to issues of shares, convertible notes or options
- (15)
3.5 Proceeds from borrowings 11,438 11,438
3.6 Repayment of borrowings - -
3.7 Transaction costs related to loans and borrowings
(833) (833)
3.8 Dividends paid - -
3.9 Other – MMG Support fee received - 5,750
3.10 Net cash from / (used in) financing activities
10,605 16,340
4. Net increase / (decrease) in cash and cash equivalents for the period
32,195 46,249 4.1 Cash and cash equivalents at beginning of
period
4.2 Net cash from / (used in) operating activities (item 1.9 above)
(22,967)
(42,702)
4.3 Net cash from / (used in) investing activities (item 2.6 above)
2,229
2,342
4.4 Net cash from / (used in) financing activities (item 3.10 above)
10,605
16,340
4.5 Effect of movement in exchange rates on cash held
356
189
4.6 Cash and cash equivalents at end of period
22,418
22,418
Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report
+ See chapter 19 for defined terms 1 September 2016 Page 3
5. Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts
Current quarter $A’000
Previous quarter $A’000
5.1 Bank balances 22,304 25,197
5.2 Call deposits 114 6,998
5.3 Bank overdrafts - -
5.4 Other (provide details) - -
5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above)
22,418
32,195
6. Payments to directors of the entity and their associates Current quarter $A'000
6.1 Aggregate amount of payments to these parties included in item 1.2 358
6.2 Aggregate amount of cash flow from loans to these parties included in item 2.3
-
6.3 Include below any explanation necessary to understand the transactions included in items 6.1 and 6.2
Payments to directors/director associates for director fees, legal fees and other fees
7. Payments to related entities of the entity and their associates
Current quarter $A'000
7.1 Aggregate amount of payments to these parties included in item 1.2 38
7.2 Aggregate amount of cash flow from loans to these parties included in item 2.3
-
7.3 Include below any explanation necessary to understand the transactions included in items 7.1 and 7.2
Payments to key management personnel
Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report
+ See chapter 19 for defined terms 1 September 2016 Page 4
8. Financing facilities available Add notes as necessary for an understanding of the position
Total facility amount at quarter end
$A’000
Amount drawn at quarter end
$A’000
8.1 Loan facilities - -
8.2 Credit standby arrangements - -
8.3 Other (please specify) US$15,000*2
AUD$40,000*1
US$0
AUD$20,000
8.4 Include below a description of each facility above, including the lender, interest rate and whether it is secured or unsecured. If any additional facilities have been entered into or are proposed to be entered into after quarter end, include details of those facilities as well.
*1 A secured A$40M Debt facility with National Australia Bank with options on Debt and Bank Guarantees with a term of 2 years. For further details see the Company's announcement dated 31 October 2018.
*2 Per the Company’s ASX announcement dated 23 April 2018, the Company has a $US15m unsecured debt facility for use as general working capital for operations at the Century Mine from offtake party MRI Trading. The debt facility is structured as a prepayment for zinc concentrates to be delivered under the offtake agreement, with the period for delivery or repayment being 120 days from drawdown. Drawdown on the debt facility is conditional upon, among other things, the commencement of commercial production of zinc concentrate at the Century Zinc Mine.
9. Estimated cash outflows for next quarter $A’000
9.1 Exploration and evaluation 100
9.2 Development 6,279
9.3 Production 40,179
9.4 Staff costs 3,945
9.5 Administration and corporate costs 2,039
9.6 Other (provide details if material) * (57,853)*
9.7 Total estimated cash outflows (5,311)
* Company is targeting its first cash flow positive quarter. Expected other cash flows (total aggregate $57,853,000) are receivables of $55,853,000 from the net revenue of zinc concentrate sales ($14,750,000 already received in January 2019 from a recently completed shipment of December 2018 quarter production) and $5,750,000 from MMG support payments (already received in January 2019), less an additional cash back bond requirement of $3,750,000 associated with a long-term power generation contract.
10. Changes in tenements (items 2.1(b) and 2.2(b) above)
Tenement reference and location
Nature of interest Interest at beginning of quarter
Interest at end of quarter
10.1 Interests in mining tenements and petroleum tenements lapsed, relinquished or reduced
NA
-
-
-
10.2 Interests in mining tenements and petroleum tenements acquired or increased
NA
-
-
-
Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report
+ See chapter 19 for defined terms 1 September 2016 Page 5
Compliance statement
1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters disclosed.
Sign here: Date: 21 January 2019(Managing Director)
Print name: Patrick Walta
Notes
1. The quarterly report provides a basis for informing the market how the entity’s activities have beenfinanced for the past quarter and the effect on its cash position. An entity that wishes to discloseadditional information is encouraged to do so, in a note or notes included in or attached to thisreport.
2. If this quarterly report has been prepared in accordance with Australian Accounting Standards,the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resourcesand AASB 107: Statement of Cash Flows apply to this report. If this quarterly report has beenprepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule19.11A, the corresponding equivalent standards apply to this report.
3. Dividends received may be classified either as cash flows from operating activities or cash flowsfrom investing activities, depending on the accounting policy of the entity.