Interim Results
January 21 2005 - 2:01AM
UK Regulatory
RNS Number:6380H
Ballarat Goldfields N.L.
20 January 2005
ASX release: 21 January 2005
Quarterly Activities and Cash flow Report
For the 3 months ended 31 December 2004
Highlights
* Development of the Ballarat East project on schedule.
* Commenced underground development in late November.
* Underground development is progressing to plan with a total advance of
149 metres at 31 December 2004.
* Significant high grade gold intersections at Ballarat East include:
6.0m @ 9.0g/t,
6.9m @ 8.2 g/t,
3.0m @ 8.6g/t,
4.3m @ 6.6g/t
10.0m @ 5.0g/t
* Diamond drilling continues to confirm the presence of gold
mineralisation where predicted by BGF's geological model.
* Tender documents for the main ventilation shaft were completed and
distributed to the preferred tenderers.
* Acquired Mining Licence MIN4847 (Ballarat South) which provides BGF
with access to the southern extension of the Ballarat East field.
BALLARAT EAST PROJECT DEVELOPMENT
All development work is on schedule with the current mine development plan.
Further details on the development are set out below.
Underground decline development
During the quarter an underground development contract to complete an extension
of the existing decline was awarded and commenced by Pybar Mining Services Pty
Ltd.
Pybar is currently engaged in other underground operations at Ridgeway, North
Parkes, Broken Hill, Olympic Dam, and Armidale. At these operations Pybar
undertake activities encompassing underground development, production drilling
and mine services.
Photo 1.
Development jumbo operating in the First Chance decline
Pybar was onsite at the start of November and assisted BGF in completing
stripping and resurfacing of the decline floor, decline rehabilitation work and
replacement of some of the existing mine services. A new underground 1000 volt
power reticulation network and secondary vent system were put in place prior to
the first cut being fired in the decline on 21 November 2004.
Photo 2.
Tamrock 40D 40 tonne truck exiting the existing Woolshed Gully decline
As of the end of December 2004, the recommencement of the development of the
single heading decline (5m wide x 5m high) had advanced 149m. At the time of
writing the decline had advanced 206m. The total length of the decline is now
1120m. As shown in Figure 1 development will now commence, from this primary
access decline, on separate headings to the First Chance and Sulieman Lines
The decline access to the Sulieman Line was commenced at the end of the quarter.
This decline will extend 900m north and provide diamond drill platforms to
evaluate the next section of the resource prior to the development and mining of
ore.
The First Chance Decline will also provide access to the southern end of the
resource which has been drill tested over the past 12 months. This orebody is
located 20m from the decline.
A ventilation drive will be developed 350m south to the planned position of the
new North Prince Extended Ventilation Shaft.
Figure 1.
Photo 4.
Victorian Premier, Steve Bracks, and BGF Managing Director, Richard Laufmann,
examine old workings off the existing Woolshed Gully decline.
Underground ventilation development
Following comprehensive geotechnical drilling, final design plans were completed
and tenders issued in mid December 2004 for the development of the new mine
exhaust vent (named the North Prince Extended Ventilation Shaft).
Documents were distributed to a short list of specialist contractors with
tenders closing on 17 January 2005 with the contract is expected to be awarded
to the preferred tenderer by 31 January 2005. BGF plans to start construction of
the shaft collar during March 2005 to fit in with the underground development
schedule.
Depending upon the actual method of construction, the development of the North
Prince Extended Ventilation Shaft is expected to take between 3 to 6 months to
complete.
PROJECT DEVELOPMENT PLAN
BGF is currently completing a project development plan which optimises the
design parameters outlined in the pre-feasibility study. The primary focus of
the plan is finalising the design of the processing plant and underground
development.
The metallurgical testwork to date continues to validate the high level of
gravity recovery from the Ballarat East ore and BGF is working closely with
Gekko Systems to further refine the process plant flowsheet and design.
The proposed underground mining development plans are being finalised following
resource definition drilling and experience gained from recent underground
development work.
DRILLING RESULTS
Underground drilling
Diamond drilling continued during the December quarter at Ballarat East,
utilising one underground diamond drill rig. The drilling continues to intersect
gold mineralisation in the targeted ore zones identified by the geological
model.
Significant assay results from the December quarter drilling are summarised in
table 1.
Hole number Down hole depth (m) Width (m)* Grade g/t Location
BDD021A 559.2 to 565.2 6.0 9.0 First Chance
---------- --------------- --------- -------- -------------
BDD021B 335.3 to 341.8 6.5 2.6 First Chance
---------- --------------- --------- -------- -------------
---------- --------------- --------- -------- -------------
DED139 333.0 to 336.0 3.0 8.6 First Chance
---------- --------------- --------- -------- -------------
DED139A 343.0 to 349.9 6.9 8.2 First Chance
---------- --------------- --------- -------- -------------
DED139C 430.3 to 431.2 0.9 12.2 First Chance
---------- --------------- --------- -------- -------------
DED140 367.0 to 374.1 7.1 3.2 First Chance
---------- --------------- --------- -------- -------------
DED140B 346.3 to 352.0 5.7 2.7 First Chance
---------- --------------- --------- -------- -------------
DED148B 194.0 to 203.0 9.0 3.0 First Chance
---------- --------------- --------- -------- -------------
DED156 196.0 to 206.0 10.0 5.0 First Chance
---------- --------------- --------- -------- -------------
DED156A 215.0 to 219.3 4.3 6.6 First Chance
---------- --------------- --------- -------- -------------
DED156B 204.0 to 206.5 2.5 5.4 First Chance
---------- --------------- --------- -------- -------------
Table 1: Assay results within defined target zones received in the Dec. 2004
quarter
*All of the intersections reported have been adjusted for their estimated true
widths. For further explanation of the significance of these assay results refer
to "BGF's Coarse Gold Interpretation" at the end of this report and also at
www.ballarat-goldfields.com.au
A new underground drilling contract has been negotiated that includes an
additional underground diamond drill rig. BGF will now have 2 underground
diamond drill rigs operating by the end of January 2005.
Surface drilling
Titeline Drilling, who was awarded the contract for surface drilling, commenced
at Ballarat East to follow-up previously identified target areas. The results
from this initial program were successful and included an intersection of 6.0m @
9.0g/t Au, 50m up dip of a drill intersection of 6.7m @ 9.6g/t Au previously
reported in 2003.
Surface drilling is currently operating between the Ballarat East and Ballarat
West goldfields to test new targets interpreted from BGF's geological modelling.
This drilling will be completed during the March quarter.
BGF's geological model robust
BGF's geological model remains robust as the drilling continues to intersect
gold mineralisation in the target zones identified by the geological model. The
model for Ballarat East identified gold mineralisation target zones totalling 28
million ounces. After probability adjustment for risk and uncertainty the
company derived an Exploration Potential of 4.5 million ounces in addition to
the indicated and inferred resources of 700,000 ounces for Ballarat East.
(Further information is available on the BGF website
www.ballarat-goldfields.com.au )
CORPORATE AND FINANCE
Finance
The cash balance at 31 December 2004 was $21.2 million.
Acquisition of Ballarat South mining lease
During the quarter BGF acquired Mining Lease MIN4847 (Ballarat South) from
Datafast Telecommunications for $200,000. This fully permitted licence area
extends the southern end of the Ballarat East field by an additional 5 km of
strike length and provides increased capacity for surface infrastructure
adjacent to the Ballarat East project.
The licence area is on Crown Land, lies predominantly within pine plantations,
and is the site of a number of historical workings (shafts and open pits). CRA
conducted exploration and trial mining activity on the licence in the 1980s with
a view to developing a large open pit operation along this mineralised trend. In
the mid 1990s, CRA began to relinquish its gold interests which included the
sale of MIN4847 in 1996 to Valdora Minerals NL who were subsequently acquired by
William Australia NL (WAL). WAL operated small open pit operations within the
licence area from 1997 to 1998.
BGF will evaluate both the open pit mineral potential of the license area and
the potential for high grade mineralisation at depth.
As an extension to the south of the Ballarat East field, BGF considers that the
success experienced with its geological modelling of Ballarat East could be
replicated on MIN4847.
As a result of this acquisition, BGF is currently re-evaluating its exploration
priorities.
BACKGROUND INFORMATION
BGF's Coarse Gold Interpretation (nugget effect)
BGF's metallurgical test work has shown that the gold mineralisation at Ballarat
East is predominately coarse to very coarse. The break down of gold particle
sizes indicates the following broad categories:
Fine Grained Gold (1.2mm) 25%
The implications of this are significant, and confirm several important features
of the mineralisation.
1. The presence of the fine grain gold should allow BGF to define the
stoping boundaries prior to development. By outlining the mineralised area
within these boundaries, development can be optimised and mining dilution
controlled.
2. The occurrence of significant amounts of coarse gold in the field, not
generally visible with drilling, has the impact of materially under estimating
the drill defined grade.
More information regarding the nugget effect at Ballarat East was included in
the September 2004 quarterly report which is available on the company's website
www.ballarat-goldfields.com.au
Ballarat East Project Summary
As reported previously since completing a raising of $27 million in July 2004,
the company moved rapidly to commence development of Ballarat East Project.
Ballarat East will be an underground mine with an expected life of 21 years.
Production, initially planned at 100,000 ounces per annum, is expected to ramp
up to an average 200,000 ounces per annum in year 3, with the weighted average
cash cost of production estimated at $A274 per ounce.
The project, evaluated at an assumed gold price of $A525 ($US390) per ounce
generates an IRR of 34% and a real pre-tax NPV of $A254 million, at a discount
rate of 7%. The 90% confidence limits on this ranges from $A132 million to $A502
million.
A summary of the development plan is available on the company's website
www.ballarat-goldfields.com.au
Disclaimer
The information and interpretations provided in this report has been compiled by
Steven Olsen. Mr Olsen is an employee of Ballarat Goldfields NL and a competent
person as defined in the JORC code. Throughout this document there is reference
to specific exploration targets which define a total exploration potential for
the Ballarat field. The term exploration target and exploration potential are
not JORC resource categories and reference to the target and potential size is
conceptual in nature. BGF does not have enough information to confirm how much
if any of the exploration potential described in this report will be converted
into a JORC mineral resource category.
Please visit the company website (www.ballarat-goldfields.com.au)for further
information including the formated version with illustrations or
contact Joel Forwood, Manager Corporate and Markets, on +613 5327 1111.
Rule 5.3
Appendix 5B
Mining exploration entity quarterly report
Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.
Name of entity
BALLARAT GOLDFIELDS NL
ABN Quarter ended ("current quarter")
------------------- ------------------
50 006 245 441 December 2004
------------------- ------------------
Consolidated statement of cash flows
------------ ------------
Cash flows related to operating activities Current quarter Year to date
$A'000 (12 months)
$A'000
------------ ------------
1.1 Receipts from product sales and related - -
debtors
1.2 Payments for (a) exploration and (3,445) (4,535)
evaluation
(b) development - -
(c) production - -
(d) administration (629) (985)
1.3 Dividends received - -
1.4 Interest and other items of a similar 409 527
nature received
1.5 Interest and other costs of finance - -
paid
1.6 Income taxes paid - -
1.7 Other (provide details if material) - -
------------ ------------
Net Operating Cash Flows (3,665) (4,993)
------ -------------------------- ------------ ------------
Cash flows related to investing
activities
1.8 Payment for purchases of: (a)prospects (588) (643)
(b)equity investments
(c) other fixed assets
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 (588) (643)
------------ ------------
1.13 Total operating and investing cash flows (4,253) (5,636)
(carried forward)
------ -------------------------- ------------ ------------
1.13 Total operating and investing cash flows (4,253) (5,636)
(brought forward)
------ ---------------------- ------------ ------------
Cash flows related to financing activities
1.14 Proceeds from issues of shares, options, etc. 9 27,235
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) - (1,752)
------------ ------------
Net financing cash flows 9 25,483
------ ---------------------- ------------ ------------
Net increase (decrease) in cash held (4,244) 19,847
1.20 Cash at beginning of quarter/year to date 25,434 1,343
1.21 Exchange rate adjustments to item 1.20
------------ ------------
1.22 Cash at end of quarter 21,190 21,190
------ ---------------------- ------------ ------------
Payments to directors of the entity and associates of the directors
Payments to related entities of the entity and associates of the related
entities
-------------
Current quarter
$A'000
-------------
1.23 Aggregate amount of payments to the parties included in 86.4
item 1.2 -------------
1.24 Aggregate amount of loans to the parties included in -
item 1.10
------ -------------------------------- -------------
1.25 Explanation necessary for an understanding of the transactions
-------------------------------------------
Item 1.23 includes salaries, director fees and superannuation paid to
directors during the quarter.
-------------------------------------------
Non-cash financing and investing activities
2.1 Details of financing and investing transactions which have had a material
effect on consolidated assets and liabilities but did not involve cash
flows
--------------------------------------------
N/A
--------------------------------------------
2.2 Details of outlays made by other entities to establish or increase their
share in projects in which the reporting entity has an interest
--------------------------------------------
N/A
--------------------------------------------
Financing facilities available
Add notes as necessary for an understanding of the position.
------------- -------------
Amount available Amount used
$A'000 $A'000
------------- -------------
3.1 Loan facilities - -
------------- -------------
3.2 Credit standby arrangements - -
----- ----------------------- ------------- -------------
Estimated cash outflows for next quarter
$A'000
------------------
4.1 Exploration and evaluation 5,000
------------------
4.2 Development -
----- ----------------------------- ------------------
Total 5,000
----- ----------------------------- ------------------
Reconciliation of cash
------------------------- ------------ -------------
Reconciliation of cash at the end of the quarter (as
shown in the consolidated statement of cash flows) to Current Previous
the related items in the accounts is as follows. quarter quarter
$A'000 $A'000
------------------------- ------------ -------------
5.1 Cash on hand and at bank 21,190 25,434
------------ -------------
5.2 Deposits at call
------------ -------------
5.3 Bank overdraft
------------ -------------
5.4 Other (provide details)
----- ---------------------- ------------ -------------
Total: cash at end of quarter (item 1.22) 21,190 25,434
----- ---------------------- ------------ -------------
Changes in interests in mining tenements
-------- --------------- -------- --------
Tenement Nature of Interest at Interest
reference interest beginning of at end of
quarter quarter
(note (2))
-------- --------------- -------- --------
6.1 Interests in mining
tenements
relinquished, reduced
or lapsed
6.2 Interests in mining MIN4847 100% NIL 100%
tenements acquired or ownership
increased
-------- --------------- -------- --------
Issued and quoted securities at end of current quarter
Description includes rate of interest and any redemption or conversion rights
together with prices and dates.
Total Number Issue price per Amount paid
number quoted security (see up per
note 3) (cents) 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,
buy-backs,
redemptions
------ ---------- ---------- ---------- ----------- -----------
7.3 +Ordinary 787,407,786 787,407,786
securities
---------- ---------- ----------- -----------
7.4 Changes during 31,939 31,939 15 cents 15 cents
quarter
(a) Increases
through issues
(b) Decreases
through returns
of capital,
buy-backs
------ ---------- ---------- ---------- ----------- -----------
7.5 +Convertible
debt securities
(description)
---------- ---------- ----------- -----------
7.6 Changes during
quarter
(a) Increases
through issues
(b) Decreases
through
securities
matured,
converted
------ ---------- ---------- ---------- ----------- -----------
7.7 Options 224,798,872 224,798,872 Exercise Expiry
(description and price date
conversion
factor)
2,000,000 15 cents 30/9/2005
5,000,000 17.25 cents 30/9/2007
2,833,334 3.45 cents 30/9/2006
11,000,000 4.72 cents 30/9/2006
One third each 30/9/2007
at: 12 cents;
13 cents; 15
cents
respectively
---------- ---------- ----------- -----------
7.8 Issued during 2,000,000 - 17.25 cents 30/9/2007
quarter
---------- ---------- ----------- -----------
7.9 Exercised during 31,939 31,939 15 cents 30/9/2005
quarter
-
---------- ---------- ----------- -----------
7.10 Expired during - - - -
quarter
------ ---------- ---------- ---------- ----------- -----------
7.11 Debentures
(totals only)
------ ---------- ---------- ----------
7.12 Unsecured notes
(totals only)
---------- ----------
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 4).
2 This statement does give a true and fair view of the matters disclosed.
Sign here:
Managing Director
Richard Laufmann
Date: 21 January 2005
Notes
1 The quarterly report provides a basis for informing the market how the
entity's activities have been financed for the past quarter and the effect on
its cash position. An entity wanting to disclose additional information is
encouraged to do so, in a note or notes attached to this report.
2 The "Nature of interest" (items 6.1 and 6.2) includes options in respect of
interests in mining tenements acquired, exercised or lapsed during the reporting
period. If the entity is involved in a joint venture agreement and there are
conditions precedent which will change its percentage interest in a mining
tenement, it should disclose the change of percentage interest and conditions
precedent in the list required for items 6.1 and 6.2.
3 Issued and quoted securities The issue price and amount paid up is not
required in items 7.1 and 7.3 for fully paid securities.
4 The definitions in, and provisions of, AASB 1022: Accounting for Extractive
Industries and AASB 1026: Statement of Cash Flows apply to this report.
5 Accounting StandardsASX 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.
== == == == ==
This information is provided by RNS
The company news service from the London Stock Exchange
END
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