Fourth Quarter Results & Cash
July 28 2005 - 3:04AM
UK Regulatory
RNS Number:4052P
Ballarat Goldfields N.L.
28 July 2005
BALLARAT GOLDFIELDS NL
A.C.N. 006 245 441
ASX and Media release: 28 July 2005
Quarterly Activities and Cash flow Report
For the 3 months ended 30 June 2005
KEY POINTS
* BGF is on schedule to access ore in the September quarter and to
commission the process plant in the December quarter 2005.
* Significant high grade gold drill intersections at Ballarat East
during the quarter include:
6.0m @ 13.7g/t,
6.8m @ 12.1g/t,
5.6m @ 8.2 g/t,
3.0m @ 24.9g/t,
1.7m @ 48.5g/t,
2.0m @ 43.8g/t.
* The process plant flowsheet sheet design has been finalised with a
planned first stage capacity of 600,000 tonnes per annum. The capital
estimate for stage 1 is around A$22 million and is in line with the
pre-feasibility cost estimates.
* Gekko Systems Pty Ltd is providing the specialised engineering
design and construction management.
* Site works for the process plant have commenced.
* The headframe and sinking stage for the construction of the ventilation
shaft were put in place during the quarter.
Post quarter end
* BGF made an initial drawdown of the A$17 million bridging finance
Facility which was put in place during the quarter.
* BGF secured an underwriting agreement with RFC Corporate Finance Ltd for
the A$0.15, 30 September 2005, listed options.
* BGF announced that Mr Alister Maitland, a former Executive Director of
the ANZ Banking Group Ltd, joined the Board as a non-executive director.
BALLARAT EAST PROJECT DEVELOPMENT
Underground decline development
At the end of the quarter, the underground development had advanced a total of
1000m with development focused on the main vent access drive, which will connect
the decline to the North Prince Extended ventilation shaft. Additional headings
into the Sulieman and Woah Hawp declines are also progressing.
Ground conditions encountered have been as expected. However, mine development
rates were slower than targeted when traversing four cross cutting structures
(between 3 and 12m) and one fault system (12m). While these structures were
anticipated, the advance rates through these areas were slower than expected due
to the installation of substantial ground support to ensure the decline remains
open for the duration of the 20 year project.
The Sulieman decline system is progressing to the north to initially provide
access for drilling but will eventually become the return airway for the mine.
The first drill site was commissioned in the Sulieman decline during the
quarter. Development has also commenced into the southern Woah Hawp decline
where driving on ore is expected to occur during the September quarter.
BGF is currently negotiating an extension to the underground development
contract. The original contract was limited to access development and the new
contract will allow for the ramp-up of access drives and for stope development.
Additional equipment to ramp up the development rate has begun arriving on site.
Figure 1. Ballarat East underground development
Ventilation shaft construction
During the quarter the North Prince Extended ventilation shaft was developed to
a total depth of 54.5 metres and the concrete lining was established to a depth
of 48 metres. Some zones are more competent than expected and this has led the
shaft development contractor, Mancala Pty Ltd, to introduce a modified drill and
blast pattern to improve advance rates through these areas.
For most of the quarter, to a shaft depth of approximately 48 metres, the
advance used a mobile crane and kibble. Subsequently, the headframe and sinking
stage arrived and was assembled and will be in place for the remainder of the
shaft sink.
Photo 1. The completed shaft collar
Photo 2. Headframe being positioned over the shaft collar
PROCESSING PLANT
Process Plant design
Ongoing metallurgical testwork has continued to demonstrate the coarse nature
and high gravity recovery achievable from this field. As a consequence the
process plant design no longer utilises a SAG mill in the circuit as the pre
feasibility indicated. Any form of grinding (SAG or ball mills) flattens the
coarse gold and works against effective gravity recovery. The design now
incorporates 2 stage crushing, with a 3rd stage vertical shaft impact crusher
replacing conventional milling.
Any gold not recovered to gravity will report to either a Falcon separator or a
high intensity leach reactor.
The design and construction management of the process plant is being undertaken
by Gekko Systems Pty Ltd. Gekko is recognised as a global leader in gravity
separation technology and is headquartered in Ballarat.
Figure 2. Process plant flowsheet
The initial design capacity is now 600,000 tonnes per annum, with the crushing
circuit operating on a day shift only. The capital cost estimate is $22 million
which is in line with the pre-feasibility estimate. The operating cost for the
plant is yet to be finalised, but the long term operating cost is expected to be
significantly lower than the pre feasibility estimate.
The processing plant is designed to treat Ballarat East ore bodies, and will
also have the capacity to treat test parcels of ore as part of the feasibility
of Ballarat South, Berringa and Ballarat West.
Many components of the first stage plant have a capacity of well in excess of
600,000 tpa when operated continuously. The timing and design of the expansion
will be governed by the performance of stage 1 and the results of the
feasibility study analysis of the other Ballarat projects. The modular design
provides significant scope for increased throughput and processing flexibility.
BGF is currently stockpiling mineralised material being excavated during the
plant construction for testing as part of the Ballarat South test work.
Photo 3. Process plant location.
Construction
Surface preparation work has commenced with the widening of the haul road,
installation of traffic controls, silt control, clearing and grubbing of the
site, mobilisation of equipment and setting up site facilities.
Photo 4 Site Earthworks
Equipment design, procurement and fabrication
Gekko Systems has been engaged to design and construct the key elements of the
process plant. Detailed design is nearing completion.
Orders have been placed for the major equipment with fabrication of specialised
gravity separation equipment by Gekko, also underway. A significant amount of
the fabrication and construction will take place in Ballarat.
The current schedule has the commissioning of the gravity concentration circuit
and production of first gold in the December quarter 2005.
DRILLING RESULTS
Underground definition drilling
Diamond drilling continued during the June quarter at Ballarat East, with the
addition of a third underground diamond drill to undertake geotechnical and
stope delineation drilling, for the first stage of production at Ballarat East.
The remaining two diamond drill rigs will be focussed on resource definition.
The drilling continues to intersect gold mineralisation in the targeted ore
zones identified by the geological model.
Significant assay results from the June quarter drilling are summarised in Table
1.
Hole Down hole depth (m) Width (m)* Grade g/t Fault Location
number
-------- ------------- --------- --------- --------- ---------
BEU026 478 to 485 6.0 13.7 Mako Sulieman
-------- ------------- --------- --------- --------- ---------
BEU024 482 to 493 9.5 3.4 Mako Sulieman
-------- ------------- --------- --------- --------- ---------
DED163A 191 to 193 2.0 11.6 Gummy First Chance
-------- ------------- --------- --------- --------- ---------
BDD026 441 to 452 8.5 3.8 Gummy First Chance
-------- ------------- --------- --------- --------- ---------
BED001 328 to 330 2.0 43.8 Grey Nurse First Chance
-------- ------------- --------- --------- --------- ---------
DED172 93 to 95 1.7 48.5 Grey Nurse First Chance
-------- ------------- --------- --------- --------- ---------
BEU033 28 to 37 6.8 12.1 Grey Nurse First Chance
-------- ------------- --------- --------- --------- ---------
BEU021B 328 to 334 5.6 8.2 Mako First Chance
-------- ------------- --------- --------- --------- ---------
BDD026 441 to 452 8.5 3.8 Mako First Chance
-------- ------------- --------- --------- --------- ---------
BED003A 546 to 549 3.0 24.9 Mako First Chance
-------- ------------- --------- --------- --------- ---------
BED001B 526 to 529 3.0 7.6 Mako First Chance
-------- ------------- --------- --------- --------- ---------
Table 1: Assay results within defined target zones received in the June quarter
2005
*All of the intersections reported have been adjusted for their estimated true
widths.
BGF drilling in the past quarter focussed on four faults within the First Chance
Line and the Sulieman Line, known as the Tiger Fault, Mako Fault, Gummy Fault
and Grey Nurse Fault (Figure 3). The mineralisation intersected on the Grey
Nurse fault is expected to provide early ore sources in 2005.
Figure 3: Cross section showing recent drilling results from the 935 section
across the First Chance and Sulieman lines at Ballarat East.
CORPORATE AND FINANCE
Finance
The cash balance at 30 June 2005 was $8.9 million.
In early April, BGF arranged a bridging finance facility for up to $17 million
with Investec Bank (Australia) Ltd to allow BGF to commence production at
Ballarat East some six months ahead of the original schedule.
During the quarter the documentation was completed and the conditions precedent
satisfied and the finance agreement was signed. BGF made an initial drawdown of
the facility in mid July.
Post quarter end
In early July, BGF announced that it had secured an underwriting agreement with
RFC Corporate Finance Ltd for the exercise of the ASX and AIM listed options.
The options have a strike price of A$0.15 and expire on 30 September 2005. The
underwritten amount is A$32.55 million.
BGF announced that Mr Alister Maitland accepted an invitation to join the Board
of BGF as a non-executive director, effective from 22 July 2005. Mr Maitland is
a former Executive Director of the ANZ Banking Group Ltd with a career spanning
35 years in Australia, New Zealand and the United Kingdom. Mr Maitland is
expected to be appointed as Chairman of the audit committee.
BACKGROUND INFORMATION
Ballarat East Project Summary
As reported previously, since completing a capital raising of $27 million in
July 2004, the company moved rapidly to commence extending the decline at
Ballarat East. The pre feasibility completed in June 2004 showed that Ballarat
East would be an underground mine with a potential life of 21 years.
The production schedule in the pre feasibility study had an initial planned rate
of 100,000 ounces per annum, ramping up to an average 200,000 ounces per annum
in year 3, with a weighted average cash cost of production estimated at $A274
per ounce.
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 identified gold mineralisation target zones totalling over 55
million ounces. After probability adjustment for risk and uncertainty the
company derived an Exploration Potential of 8.3 million ounces, with 90%
confidence limits ranging from 2.8 million ounces to 14.4 million ounces in
addition to an inferred resource of 1.1 million ounces for Ballarat East.
(Further information is available on the BGF website
www.ballarat-goldfields.com.au )
Note:
The information in this report that relates to Exploration Results, Mineral
Resources and Exploration Potential is based on information compiled by Mr
Steven Olsen. Mr Olsen is an employee of Ballarat Goldfields NL, is a member of
the Australian Institute of Mining and Metallurgy and is a Competent Person
under the definition of the 2004 JORC Code. The Exploration Potential described
above is conceptual in nature, and there is insufficient information to
establish whether further exploration will result in the determination of a
Mineral Resource. Mr Olsen consents to the publication of this information in
the form and context in which it appears.
CORPORATE DIRECTORY
Registered and Principal Office Directors
10 Woolshed Gully Drive Colin Smith Chairman
Mt Clear Victoria 3350 Richard Managing Director
Laufmann
Australia Mike Etheridge Non-executive
Director
Alister Maitland Non-executive
Director
Web Site Company Secretary
www.ballarat-goldfields.com.au Amber Rivamonte
Shareholder Services Stock Exchange Listing
Computershare Investor Services Pty Australian Stock Exchange Code BGF
Limited
GPO Box 2975EE Alternative Investment Market (AIM)
BGF
Melbourne AIM Nominated Advisor
Victoria 3000 RFC Corporate Finance Ltd
Australia Level 14
Investor Enquires Tel: 1300 850 505 19-31 Pitt St
Tel: 03 9415 5000 Sydney, NSW
Fax: 03 9473 2500 Australia 2000
www.computershare.com AIM Nominated Broker
Numis Securities
Cheapside House
138 Cheapside
London EC2V 6LH
United Kingdom
For further information: please visit the company website
(www.ballarat-goldfields.com.au)
Or contact Joel Forwood, Manager Corporate and Markets, on (03) 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 June 2005
------------------- ------------------
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 (6,652) (15,176)
evaluation
(b) development - -
(c) production - -
(d) administration (646) (2,374)
1.3 Dividends received - -
1.4 Interest and other items of a similar 157 915
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 (7,141) (16,635)
------ -------------------------- ------------ ------------
Cash flows related to investing
activities
1.8 Payment for purchases of: (a)prospects (200)
(b)equity investments
(c) other fixed assets (1,307) (2,004)
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 (1,307) (2,204)
------------ ------------
1.13 Total operating and investing cash flows (8,449) (18,839)
(carried forward)
------ -------------------------- ------------ ------------
1.13 Total operating and investing cash flows (8,449) (18,839)
(brought forward)
------ ---------------------- ------------ ------------
Cash flows related to financing activities
1.14 Proceeds from issues of shares, options, etc. 885 28,185
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 885 26,433
------ ---------------------- ------------ ------------
Net increase (decrease) in cash held (7,564) 7,594
1.20 Cash at beginning of quarter/year to date 16,501 1,343
1.21 Exchange rate adjustments to item 1.20
------------ ------------
1.22 Cash at end of quarter 8,937 8,937
------ ---------------------- ------------ ------------
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 108
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 17,000 -
------------- -------------
3.2 Credit standby arrangements - -
----- ----------------------- ------------- -------------
Estimated cash outflows for next quarter
------------------
$A'000
------------------
4.1 Exploration and evaluation 8,500
------------------
4.2 Development -
----- ----------------------------- ------------------
Total 8,500
----- ----------------------------- ------------------
Reconciliation of cash
------------------------- ------------ -------------
Reconciliation of cash at the end of the quarter (as Current Previous
shown in the consolidated statement of cash flows) to quarter quarter
the related items in the accounts is as follows.
$A'000 $A'000
------------------------- ------------ -------------
5.1 Cash on hand and at bank 8,937 16,500
------------ -------------
5.2 Deposits at call
------------ -------------
5.3 Bank overdraft
------------ -------------
5.4 Other (provide details)
----- ---------------------- ------------ -------------
Total: cash at end of quarter (item 1.22) 8,937 16,500
----- ---------------------- ------------ -------------
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
tenements acquired or -------- --------------- -------- --------
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 793,907,022 793,907,022
securities
---------- ---------- ----------- -----------
7.4 Changes during 5,902,062 5,902,062 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 Exercise Expiry
(description and price date
conversion
factor) 218,466,302 218,466,302 15 cents 30/9/2005
5,000,000 3.45 cents 30/9/2006
2,666,668 4.72 cents 30/9/2006
11,000,000 One third each 30/9/2007
at: 12 cents;
13 cents; 15
cents
respectively
2,000,000 17.25 cents 30/9/2007
5,000,000 15 cents 2/12/2007
---------- ---------- ----------- -----------
7.8 Issued during
quarter ---------- ---------- ----------- -----------
7.9 Exercised during 5,902,062 5,902,062 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: 28 July 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 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.
== == == == ==
This information is provided by RNS
The company news service from the London Stock Exchange
END
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