Hawthorn Resources Limited June 2013 Quarterly Report

Transcription

1 ASX Release 31 July 2013 ABN Hawthorn Resources Limited Level 2, 90 William Street Melbourne VIC 3000 Australia Tel: Fax: info@hawthornresources.com Directors Mr Mark Gregory Kerr (Chairman) Mr Mark Edward Elliott (Managing Director/CEO) Dr David Tyrwhitt (Non Executive Director) Mr Li, Yijie (NonExecutive Director) Mr Liao, Yongzhong (NonExecutive Director) Mr Ye, Xiaohui (NonExecutive Director) Hawthorn Resources Limited June 2013 Quarterly Report EXPLORATION AND DEVELOPMENT Kalgoorlie, Eastern Goldfields Gold, Western Australia Drilling results from infill drilling at the Anglo Saxon Resource in the Trouser Legs JV intersects high grade gold results in the linking area between proposed pits including o o o g/t Au, g/t Au, g/t Au. New geological model in preparation at Anglo Saxon resource model. Updated gold resource statement expected in August September. Studies to confirm and identify metallurgical, environmental, hydrological and landholder factors required to commence mining at Anglo Saxon commence. When complete a mining block model to be prepared. Senior Management Mr Ian Moody (Exploration Manager) Mr Mourice Garbutt (Company Secretary) ASX Symbol: HAW Diamond drill core program to commence at Anglo Saxon to provide metallurgical and geotechnical data for mining studies Initial RC drilling at Lindsay South and Whiteheads North in the Whiteheads Project area commenced. Follow up exploration on targets identified in recent detailed aeromagnetic survey covering the Yundamindera Project area continues. Final tranche of shares issued to Fenghua Mining Investment Holding (HK) Limited raising A$ 10,794,079.53

2 INTRODUCTION Hawthorn Resources Limited ( Hawthorn ) is an Australian diversified minerals exploration company with tenement holdings and joint ventures primarily focussed in the Kalgoorlie District of the Eastern Goldfields of Western Australia. Hawthorn s exploration effort remains focussed on the progression of its highly prospective portfolio of gold tenements towards production, with exploration concentrated on its 5 key project areas. Trouser Legs Anglo Saxon, Deep South, Yundamindera Coffey Bore, Edjudina Triumph, and Whiteheads. During the quarter exploration and development was focussed at the Anglo Saxon Resource in the Trouser Legs Project Area, however an initial RC drilling campaign was carried out at the Lindsay s South and Whiteheads North prospects in the Whiteheads Project area. Exploration on newly defined aeromagnetic targets in the Yundamindera Project area has continued. Continued drilling at Anglo Saxon Resource has successfully tested a zone of gold mineralisation that links gold ore zones between the notional pit positions on the existing resource model. Strong gold results from this zone increase the coherency of the geological model with results including: o o o o g/t Au, g/t Au, g/t Au, and g/t Au. These results have provided extra information to Hawthorn required to commence a new geological model that will lead to an updated resource statement during August September. Metallurgical and geotechnical core drilling is to commence in the next week that will provide important mining parameters required to establish a reserve model expected later in In advance of the completion of these resource and reserve models, the necessary nonmining (primarily Environmental, Hydrological and Landholder Title) studies required for mining approval have commenced, with independent contractors and consultants onsite at Anglo Saxon At the Whiteheads Project an initial 16 RC hole program has been completed at the Lindsay s South, Whiteheads Dam and Whiteheads North prospects. Results from this drilling are expected later in August. At Yundamindera the recently completed project wide detailed aeromagnetic survey and interpretation continues to be assessed. The aeromagnetic survey was designed to identify extensions of the Coffey Bore porphyry, identify repetitions of the porphyry signature within the larger project area and focus drill targets to be drilled in the upcoming year is complete. Sampling of further targets identified by interpretation continues with drilling of such target scheduled for the December quarter. At Mt Bevan Central Yilgarn Iron Province Legacy Iron Ore has modified the proposed program of exploration for the remainder of calendar year The modified program continues to complete previously agreed programs including the updated Mt Bevan Resource Estimate and drilling of the identified haematite target at Mt Mason North. Greenfields exploration for haematite and magnetite is also proposed for the Mt Alexander area. 2

3 Gold Exploration Western Australia incorporating: Deep South Project Hawthorn Resources 80%, Alacer Gold Corp 20%; Trouser Legs Project Hawthorn Resources 70%, Gel Resources 30%; Edjudina Triumph Project Yundamindera Project Hawthorn Resources 100% and EdjudinaPinjin JV Tenements (Hawthorn Resources 80%, Alacer Gold Corp 20%); Hawthorn Resources 100% and EdjudinaPinjin JV Tenements (Hawthorn Resources 80%, Alacer Gold Corp 20%); and Whiteheads Project Hawthorn Resources 100% Hawthorn Resources Western Australian gold exploration programs are primarily focussed in five major project areas where Hawthorn Resources holds in its own right, has earned or is earning equity from joint venture partners in over 100 granted exploration, mining, prospecting licences and applications. The company believes that each of the major project areas, in close proximity to milling and transport infrastructure, hold both exploration upside and near term potential for development. Figure 1. Eastern Goldfields, Western Australia Project Locations 3

4 The major projects cover two distinct areas. A near contiguous part of the Eastern Goldfields of Western Australia extending from the south shore of Lake Carey to the historic Pinjin Mining Centre a strike extent of approximately 125 kilometres. Hawthorn s tenement package is surrounded by major gold mines, deposits and advanced resources including Sunrise Dam, Wallaby, Red October, Carosue Dam, Safari Bore, Deep South, Porphyry and Butchers Well Mines. The gold endowment of these mines and resources currently exceeds 22 Million ounces. A contiguous group of 15 tenements ( Whiteheads ) covering the historic Gindalbie Mining Centre that surrounds the Lindsays gold resource of KalNorth Gold Mines Limited ( KalNorth ), and only 50 kilometres from the mining infrastructure hub of Kalgoorlie. Trouser Legs Anglo Saxon Project (Hawthorn Resources70%, Gel Resources 30%). The Trouser Legs Project area is located 140 km north east of Kalgoorlie and is centred on the historic Anglo Saxon Mine. The Trouser Legs Anglo Saxon project area is situated 35 kilometres to the east of the Carosue Dam Mill of Saracen Mineral Holdings. A series of resource estimations carried out between 1994 and 2001 and more recently in late 2011, determined that a near surface, mainly oxide, ore deposit of approximately 25,000 ounces of gold could be defined within a much larger global gold resource. A further drilling program was carried out during June that was designed to further test the extent of gold ore zones around the margins, and in poorly defined portions, of the existing interpreted resource. As such the results presented below should be regarded as new data. Table 1. RC drilling results Anglo Saxon June 2013 Hole No. Azimuth Dip North East From (m) To (m) Width (m) Au (g/t) PINC and PINC and (incl ) PINC (incl ) PINC and PINC NSA PINC Assay Pending PINC and Assay Pending PINC and (incl ) and and and and PINC (incl ) (incl ) 4

5 and and and and and PINC (incl ) and and and (incl ) and and and and and PINC and PINC and and and and PINC and and and (incl ) (incl ) (incl ) and and and PINC and and and PINC and (incl ) PINC NSA PINC PINC NSA PINC NSA PINC and PINC PINC NSA All RC Holes collected as 1 metre splits from rotating splitter. All Assays Bureau Veritas Laboratories, Kalgoorlie 0.50 g/t Au lower cut < 2.0m of internal waste 25.0 g/t Au upper cut EOH = End of Hole In particular drillholes PINC and PINC192193, drilled on a historic waste dump to the south and south east of the existing Anglo Saxon open cut pit, are noteworthy. 5

6 Fig 2. Drilling of PINC190 on Anglo Saxon Waste Dump Little drilling had previously been carried out in this area due to difficulties in obtaining safe access for drilling pads due to the steep and narrow nature of the waste dump. The numerous ore zones revealed in each hole and in particular the broad intercepts in the shallow supergene enriched clay layer, are believed to link a conspicuous gap in the existing resource model. The deeper, but narrow, high grade gold results returned may have positive implications in the longer term future of the project. Following receipt of these results a new geological model is being compiled by Hawthorn personnel and Australian Mining Consultants (AMC). This revised model will form the basis of an updated resource that is expected to be complete in August September. Metallurgical and geotechnical core drilling is to commence in the next week that will provide important mining parameters required, if positive, to establish a reserve model expected later in In advance of the completion of these resource and reserve models, the necessary nonmining (primarily Environmental, Hydrological and Landholder Title) studies required for mining approval from the West Australian Department of Mines have commenced, with independent contractors and consultants onsite at Anglo Saxon under the supervision of Hawthorn s Project Manager and his team. Whiteheads Project (Hawthorn 100%) The Whiteheads Project area is situated within the historic Gindalbie Mining area, 50 kilometres northeast of Kalgoorlie, Western Australia. The project area is also only 30 kilometres from gold plants at Kanowna Belle and Paddington Mines. The project area is adjacent to the historic Gindalbie Mining Centre (45,000 ounces of gold produced at 27 g/t Au) and surrounds KalNorth Gold Limited s (ASX:KGM) Lindsay s Deposit (43,000 ounces of Gold Reserve, 323,000 ounce Gold Resource). KalNorth have continued production from the deposit during the quarter despite a volatile gold price. 6

7 Figure 3 Hawthorn Whitehead Project Area An initial 16 hole RC drilling program commenced at Hawthorn s Lindsay South, Whiteheads Dam and Whiteheads North at the end of the quarter and was completed in midjuly. In general the drilling continued to identify thick zones of supergene clays above a complex suite of quartz veined and brecciated basalts, in contact with granodiorite sills and dykes in the Lindsay s South area and sheared felsic volcanics in contact with more mafic units in the two Whiteheads areas drilled. Results from this program are expected in the upcoming weeks Yundamindera Project (Hawthorn 100% and Hawthorn Resources 80%, Alacer Gold 20%). In the Yundamindera Project area, located approximately 175 kilometres to the north east of Kalgoorlie, Western Australia exploration has focused on the discovery of gold associated with mineralised syenitic porphyry dykes, BIF s and shears. A significant mineralised body has been identified at Coffey Bore where a broad zone of gold mineralisation associated with stockwork quartz veining at the base of a shallow, 45 east dipping, porphyry intrusion has been drill tested over 450 metres of strike. Interpretation and target definition studies carried out by renowned geophysical consultants Southern Geoscience Consultants Pty Ltd has identified a further series of combined magnetic and radiometric targets in areas of pervasive soil cover. 7

8 Sampling of these targets is ongoing and should provide strong drill targets, above and beyond extension drilling of the Coffey Bore porphyry later in the current year. Deep South Project (Hawthorn Resources 80%, Alacer Gold 20%). The project area lies directly along strike to the south of Deep South Mine, approximately 170 km to the north east of Kalgoorlie in Western Australia. Hawthorn holds tenements in this area in Joint Venture, with Alacer Gold. Hawthorn has identified a gold mineralised horizon analogous to the adjacent Deep South gold orebodies (Indicated and Inferred Resource 279,000 oz Au) of Saracen Mineral Holdings Limited. With the focus of exploration and development in the Anglo Saxon area, limited exploration has been undertaken in this project area during the quarter. Edjudina Triumph Project (Hawthorn 100%) Gold mineralisation in the project area, 145 kilometres Northeast of Kalgoorlie is hosted by a series of strike parallel quartz veins. Three major, distinct and separate quartz vein sets ( Reef 1, 2 & 3 ) host most of the known gold mineralisation in the project area. With the focus of exploration and development in the Anglo Saxon area, limited exploration has been undertaken in this project area during the quarter. 8

9 Iron Ore Exploration Western Australia Mount Bevan Iron Ore Project (Hawthorn 40%, Legacy 60%) The Mount Bevan Project comprising Exploration Licences 29/510 and 29/713 is located approximately 100 km west of Leonora in the central Yilgarn region of Western Australia. Figure 4 Mt Bevan Project Area The tenement covers a sequence of Banded Iron Formation (BIF) units, sediments and lavas that dip at 20 50% towards the north east. Three substantial BIF horizons have been identified within the tenement to date that extend in a northnorthwest orientation throughout the entire length of the tenement; a strike distance of more than 25 kilometres. Legacy Iron Ore, the JV Manager, has submitted a revised exploration and development program to Hawthorn for the remainder of calendar year 2013, that will complete previously agreed programs including an updated, and upgraded Mt Bevan Resource Estimate and drill testing of the known haematite mineralisation at Mt Mason North. Greenfields exploration for haematite and magnetite is also proposed for the Mt Alexander area. Joint Ventures Erayinia Joint Venture Western Australia (Black Raven Mining 70%, Hawthorn Resources 30%). The new Joint Venture manager, Black Raven Mining Pty Ltd, has reported that a new VTEM survey has been completed on the Joint venture ground during the quarter. Follow up sampling of targets identified is reported to be underway. East Kimberley Joint Venture Western Australia (Thundelarra 80%, Pindan Panoramic Resources earning to 48.8% of Thundelarra interest, Hawthorn Resources 20%) Panoramic Resources have reported that no new exploration was undertaken on the East Kimberley Joint Venture during the quarter. 9

10 CORPORATE Funding and Consolidation of Securities On 30 April 2013 and pursuant to a Share Subscription Agreement ( SSA ) with Feng Hua Mining Investment Holding (HK) Limited ( Feng Hua ) the Company issued the shareholder approved Tranche 2 issue of new shares being 967,211,427 shares at $ a share bringing the total raising under the SSA to $14,962, The total number of shares as issued to Feng Hua being 1,287,827,651 shares representing 37.6 per cent of the expanded number of shares then on issue (3,425,269,144 shares). As noted in the accompanying Appendix 5B Cashflow Report the Company had funds in hand as at 30 June 2013 of $ million. In May 2013, following the completion of the above equity raising and as approved by shareholders in meeting on 30 January 2013, the Company conducted a Consolidation of ordinary shares on the basis of one new share for each twenty shares held as at the Record Date (10 May 2013). The Consolidation, after allowance for roundings, resulted in the number of ordinary fully paid shares now on issue being 171,263,644 shares. Directorate With the completion of the Feng Hua equity raising on 30 April 2013 the Board of Directors formally appointed Mr Ye, Xiaohui as a director of the Company. At the 30 January 2013 meeting of shareholders Mr Ye was elected as a director of the Company subject to, in part, the completion of the Feng Hua equity raising. With the appointment of Mr Ye the Board of Directors comprises: Mr Mark G Kerr, Chairman and NonExecutive Director; Mr Mark E Elliott, Managing Director and CEO; Dr David S Tyrwhitt, NonExecutive Director; Mr Liao, Yongzhong, NonExecutive Director; Mr Li, Yijie, Non Executive Director; Mr Ye, Xiaohui, NonExecutive Director A further Mourice R Garbutt Company Secretary h\june 2013 activites report The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr Ian Moody, who is a member of the Australasian Institute of Mining and Metallurgy and a full time consultant geologist with First Principle Mineral Exploration Company Pty Ltd. Mr Moody has sufficient experience as a geologist which is relevant to the style of mineralization and the type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 edition of the Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Moody consents to the inclusion in this report of the matters based on his information in the form and context in which it appears. Attached is a copy of the Company s Mining Exploration Entity Quarterly Report in accordance with Listing Rule

11 Appendix 5B Mining exploration entity quarterly report Appendix 5B Rule 5.3 Mining exploration entity quarterly report Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001, 01/06/10, 17/12/10 Name of entity HAWTHORN RESOURCES LIMITED ABN Quarter ended ( current quarter ) June 2013 Consolidated statement of cash flows Current quarter Year to date Cash flows related to operating activities (12 months) $A 000 $A Receipts from product sales and related debtors 1.2 Payments for (a) exploration and (351) (2,139) evaluation (b) development (c) production (d) administration (339) (1,460) 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other (provide details if material) GST (Refundable) 253 Net Operating Cash Flows (657) (3,176) Cash flows related to investing activities 1.8 Payment for purchases of: (a) prospects (b) equity investments (c) other fixed assets (47) (47) 1.9 Proceeds from sale of: (a) prospects (b) equity investments (c) other fixed assets 1.10 Loans to other entities 1.11 Loans repaid by other entities 1.12 Other (provide details if material) Net investing cash flows 1.13 Total operating and investing cash flows (carried forward) (47) (47) (704) (3,223) + See chapter 19 for defined terms. 17/12/2010 Appendix 5B Page 1

12 Appendix 5B Mining exploration entity quarterly report 1.13 Total operating and investing cash flows (brought forward) (704) (3,223) Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc.net 10,775 14,700 of capital raising costs paid in June quarter 1.15 Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other (provide details if material) Net financing cash flows 10,775 14,700 Net increase (decrease) in cash held 10,071 11, Cash at beginning of quarter/year to date 4,296 2, Exchange rate adjustments to item Cash at end of quarter 14,367 14,367 Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities Current quarter $A' Aggregate amount of payments to the parties included in item Aggregate amount of loans to the parties included in item Explanation necessary for an understanding of the transactions in item 1.23 Directors fees & salary $84,215 (Previous Quarter $78,027) Fully Serviced Office facility rental $86,625 (Previous Quarter $86,625) Company requested Consulting Fees $8,250 (Previous Quarter $18,480) Noncash 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 + See chapter 19 for defined terms. Appendix 5B Page 2 17/12/2010

13 Appendix 5B Mining exploration entity quarterly report Financing facilities available Add notes as necessary for an understanding of the position. 3.1 Loan facilities 3.2 Credit standby arrangements Amount available $A 000 Amount used $A 000 Estimated cash outflows for next quarter 4.1 Exploration and evaluation 4.2 Development 4.3 Production 4.4 Administration $A Total 1,530 Reconciliation of cash Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows. Current quarter $A 000 Previous quarter $A Cash on hand and at bank Deposits at call 13,510 4, Bank overdraft 5.4 Other (provide details) Total: cash at end of quarter (item 1.22) 14,367 4,296 Changes in interests in mining tenements 6.1 Interests in mining tenements relinquished, reduced or lapsed Tenement reference Nature of interest (note (2)) See Attached Interest at beginning of quarter Interest at end of quarter + See chapter 19 for defined terms. 17/12/2010 Appendix 5B Page 3

14 Appendix 5B Mining exploration entity quarterly report 6.2 Interests in mining tenements acquired or increased See Attached + See chapter 19 for defined terms. Appendix 5B Page 4 17/12/2010

15 Appendix 5B Mining exploration entity quarterly report 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 security (see note 3) (cents) Amount paid up per security (see note 3) (cents) 7.1 Preference + securities (description) 7.2 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buybacks, redemptions 7.3 Ordinary securities 171,263, ,263, Opening Balance 01/04/13 2,458,057,717 2,458,057,717 Changes during quarter (a) Increases through issues (b) Decreases through share consolidation cancellation (c) Increase though share consolidation ReIssue 967,211,427 (3,425,269,144) 171,263, ,211,427 (3,425,269,144) 171,263, Convertible debt securities (description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted 7.7 Options (description and conversion factor) Exercise price Expiry date 7.8 Issued during quarter 7.9 Exercised during quarter 7.10 Lapsed during quarter 7.11 Debentures (totals only) 7.12 Unsecured notes (totals only) + See chapter 19 for defined terms. 17/12/2010 Appendix 5B Page 5

16 Appendix 5B Mining exploration entity quarterly report Compliance statement 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 5). 2 This statement does give a true and fair view of the matters disclosed. Sign here:... Date: 31/07/2013 (Company secretary) Print name: MOURICE GARBUTT Notes 1 The quarterly report provides a basis for informing the market how the entity s activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report. 2 The Nature of interest (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 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 Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with. == == == == == HAWTHORN RESOURCES LIMITED + See chapter 19 for defined terms. Appendix 5B Page 6 17/12/2010

17 Appendix 5B Mining exploration entity quarterly report ACN CHANGES IN INTERESTS IN MINING TENEMENTS 6.1 Interests in Mining Tenements relinquished, reduced or lapsed Tenement Reference Nature of Interest [note (4)] Interest at beginning of quarter Interest at end of quarter E31/416 Expired 100% 0% E31/572 Expired 100% 0% P40/1238 Expired 100% 0% P40/1239 Expired 100% 0% 6.2 Interests in Mining Tenements acquired Or increased Tenement Reference Nature of Interest [note (4)] Interest at beginning of quarter Interest at end of quarter + See chapter 19 for defined terms. 17/12/2010 Appendix 5B Page 7