TIDMBGL
RNS Number : 7270Y
Bullabulling Gold Limited
29 January 2014
29 January 2014 ASX Code: BAB, AIM Code: BGL
QUARTERLY ACTIVITY REPORT
FOR THE THREE MONTHS ENDED 31 December 2013
Highlights
Bullabulling Gold Project
-- DFS engineering continues to progress in line with expectations
-- Production forecast 94.7Mt containing 2.6 million ounces of gold
-- Mine life approximately 13 years averaging 175,000 ounces per annum
-- DFS targeted for completion by the end of 2014
Exploration and Resource Development
-- Gibraltar resource updated following 19 hole drilling program
-- Total project resource now 114 Mt at 1.02 g/t for 3.8 million ounces of gold
Bullabulling Ranks Favorably in Global Survey of Major Gold
Projects
-- Well inside top 50% of global gold projects by resource size
-- Resource grade exceeds global and Australian average
-- Third largest undeveloped gold deposit in Australia
Corporate
-- Cash and deposits at 31 December 2013 total $4.3 million
Bullabulling Gold Project
During the quarter, engineering and evaluation studies continued
in support of the definitive feasibility study into the
establishment of a 7.5 million tonne per annum open pit mining
operation at Bullabulling.
Following an upgrade of the northern section of the Bullabulling
resource completed in the September 2013 quarter (see release 19
September 2013) the viability of relocating public infrastructure
which traverses the mineralised trend was evaluated.
Four open pits are proposed for development at Bullabulling with
the most northerly two pits, Bonecrusher and Dicksons, separated by
an exclusion zone accommodating overhead power transmission lines
and a below-ground telecommunications cable. Dicksons is separated
from the Phoenix pit to the south by an easement for Great Eastern
Highway and the Goldfields Water Supply pipeline.
Re-optimisation of the open pit designs to incorporate the
September 2013 resource update and potential relocation of the
infrastructure supported re-routing of the power line and
telecommunications cable to enable the Bonecrusher and Dicksons
pits to be expanded.
The expanded Bonecrusher and Dicksons mine plans capture an
additional 5.4 million tonnes of diluted resource grading 0.87g/t
for 150,000 ounces of contained gold (see release 15 October 2013)
taking total forecast mine production over a projected mine life of
approximately 13 years to 94.7 million tonnes at 0.84g/t for
2,562,000 ounces of contained gold.
The study determined that the volume of mineralisation
sterilized by the highway easement was not substantial and
relocation of Great Eastern Highway and the Goldfields Water Supply
pipeline to extend the Dicksons pit south and the Phoenix pit north
was not warranted. However a minor realignment of the road and pipe
line, which would enable an incremental northerly extension of the
Phoenix pit, may be warranted and this will be further
evaluated.
A comparison of the new production forecast with the previous
estimate released on 2 July 2013, which was calculated using the
same parameters, is presented in Table 1 below.
Table 1: Bullabulling Mine Production Estimate (Diluted Mineral
Resource Within Pit Designs)
-------------------------------------------------------------------------------------
Indicated Resource Inferred Resource Total
------------------------ ---------------------- ------------------------
Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces
--------- ------ ----- --------- ------ ----- ------- ------ ----- ---------
July 2013 76.3 0.82 2,007,000 13.0 0.97 405,000 89.3 0.84 2,412,000
Mt g/t oz Mt g/t oz Mt g/t oz
--------- ------ ----- --------- ------ ----- ------- ------ ----- ---------
Increase 3.6 0.82 90,000 1.8 0.97 61,000 5.4 0.87 150,000
Mt g/t oz Mt g/t oz Mt g/t oz
--------- ------ ----- --------- ------ ----- ------- ------ ----- ---------
October 79.8 0.82 2,096,000 14.8 0.97 466,000 94.7 0.84 2,562,000
2013 Mt g/t oz Mt g/t oz Mt g/t oz
--------- ------ ----- --------- ------ ----- ------- ------ ----- ---------
Note: The Bullabulling Mineral Resource, presented in Table 2
below, was estimated using a 0.5 g/t cut-off grade. The mining
blocks which comprise the production estimate include
mineralisation below the resource cut-off grade.
The production estimate is not a Mining Reserve as approximately
15% of the resource tonnage within the pit designs is classified as
Inferred. It is intended to carry out infill drilling in 2014 to
reclassify the Inferred Resource within the pit designs to enable a
maiden Mining Reserve to be declared. If infill drilling results in
the Inferred Resource being reclassified without a material change
in tonnage or grade and there is no significant change in economic
parameters, it is expected that a Mining Reserve of approximately
2.5 million ounces would be reported.
The definitive feasibility study is targeted for completion by
the end of 2014, with first gold production in mid-2016.
Exploration and Resource Development
Gibraltar
Gibraltar is situated approximately six kilometres south-east of
the Company's Bullabulling Gold Project and has been subject to
prior open pit mining in the mid 1990's. During the September 2013
quarter a reverse circulation (RC) drilling program was carried out
to improve definition of the existing resource and test for
resource extensions potentially amenable to open pit mining (see
release of 27 September 2013).
During the December 2013 quarter the Mineral Resource estimate
for Gibraltar was updated to incorporate the drill results (see
release of 25 October 2013). The Gibraltar resource, classified as
Inferred in accordance with the JORC code and estimated using a
0.5g/t cut-off, now stands at 4.9 million tonnes grading 1.07g/t
for 169,000 ounces of contained gold.
Open pit optimisation and mine design has been carried out on
the Gibraltar deposit to determine whether it is viable to develop
Gibraltar as a satellite operation to Bullabulling. Work to date
indicates that the historic open pit at Gibraltar could be extended
and deepened to provide supplementary feed to the Bullabulling
plant and facilitate a modest extension to the mine life which is
currently projected to be 13 years. This work is ongoing.
Total Project Resource
Total resources for the Bullabulling Gold Project now stand at
114.0 million tonnes grading 1.02g/t for 3.75 million ounces of
contained gold, as detailed in Table 2 below.
Table 2: Bullabulling Gold Project Mineral Resource Estimate
(0.5g/t cut-off)
---------------------------------------------------------------------------
Deposit Classification Tonnage Grade Cont. Gold
---------------------- --------------- --------- --------- ------------
Bullabulling Laterite Inferred 1.7 Mt 0.89 g/t 48,000 oz
---------------------- --------------- --------- --------- ------------
Bullabulling Primary Indicated 72.4 Mt 0.98 g/t 2,279,000
oz
---------------------- --------------- --------- --------- ------------
Inferred 35.0 Mt 1.12 g/t 1,257,000
oz
---------------------- --------------- --------- --------- ------------
Bullabulling Total Ind. & Inf. 109.1 Mt 1.02 g/t 3,584,000
oz
---------------------- --------------- --------- --------- ------------
Gibraltar Inferred 4.9 Mt 1.07 g/t 169,000 oz
---------------------- --------------- --------- --------- ------------
Project Total Ind. & 114.0 Mt 1.02 g/t 3,753,000
Inf. oz
---------------------- --------------- --------- --------- ------------
Note: Small discrepancies may occur due to the effects of
rounding
Bullabulling Global Ranking
The global significance of the Bullabulling Gold Project was
reaffirmed with the release in November of the 2013 Ranking of Gold
Mines and Deposits by Natural Resource Holdings Limited (NRH). NRH
have produced a report which seeks to catalogue deposits with
resources of one million ounces or more. Their report was expanded
for 2013 to include a significant number of high grade, but "high
risk" African deposits that were previously excluded and now lists
580 deposits globally.
Bullabulling sits comfortably within the top half of global
deposits by size, and it can be noted that many of the projects to
which Bullabulling (excluding Gibraltar) is being compared comprise
multiple deposits. Bullabulling's ranking would be higher if the
comparison was solely between individual deposits.
Bullabulling's resource grade is marginally above the average
grade of all projects on NRH's list, which is 1.01 g/t, and
substantially above the 0.89 g/t average grade of the 375
undeveloped gold projects. Bullabulling compares favourably to the
average grade of the 55 one million ounce plus Australian peers
included in the report which have an average grade of 0.87 g/t.
It should be noted that Bullabulling is the third largest
undeveloped individual gold deposit in Australia and has a higher
grade than both of the larger projects.
Whilst the NRH report highlights Bullabulling's strong ranking
based on both size and grade, the Company considers that the
project's location in a stable, pro-mining jurisdiction in close
proximity to infrastructure and services, further distinguishes it
from many of its global and Australian peers. In addition, the fact
that Bullabulling's resource is hosted within a single body of
mineralisation provides opportunity to achieve economies of scale
not available to some of the multi deposit projects.
Cash Position
The Company held cash and deposits of $4.3 million at quarter
end.
Director Fees
On 31 May 2013 the Company advised that in order to aid cash
preservation, the non-executive directors of the Company would
accept the issue of shares in satisfaction of 50% of their
directors fees, subject to shareholder approval.
The number of shares to be issued is to be calculated on a
calendar quarterly basis, with the issue price being the five day
volume weighted average price (VWAP) at the end of the relevant
quarter.
For the December quarter it is proposed to issue 570,058
Bullabulling Gold Limited ordinary shares at a price of 4.3 cents
in place of directors fees totaling $24,512.
Shareholder approval to issue the shares will be sought at the
next meeting of shareholders. Should shareholders not approve the
issue of the shares, the outstanding directors fees will be paid in
cash.
Market
The gold price remained volatile during the December 2013
quarter, starting the period at US$1,326 per ounce, then trading in
a range from US$1,195 to US$1,361 before closing at US$1,204.
The decline in the gold price over the quarter was largely
offset by a decline in the USD:AUD exchange rate. The Australian
Dollar commenced the quarter at 0.9396, but closed at 0.8948.
2014 has to date seen the gold price firm to US$1,263per ounce.
The exchange rate has also continued to improve with the AUD down
to 0.876 at the date of this report, delivering an Australian
Dollar gold price of A$ 1,441 per ounce.
The volume of M&A activity within the gold sector, at both
an asset and corporate level, has stepped up since year end
indicating greater confidence in the outlook for the sector and
that market sentiment may be improving.
For information, contact:
Brett Lambert Westhouse Securities Limited
Bullabulling Gold Limited (UK Broker & Nominated Adviser)
Level 2, 55 Carrington Street Martin Davison / Dominic Palmer-Tomkinson
Nedlands, WA, 6009, Australia / Hugo Rubinstein
Tel: +61 8 9386 4086 Tel: +44 20 7601 6100
------------------------------- -----------------------------------------------
Neil Boom John Gardner / Rupert Dearden
Gresham PR Ltd (UK media) MAGNUS Investor Relations. Corporate
Tel: +44 7866 805 108 Communication. (Australian Media)
Tel: +61 8 6160 4900
jgardner@magnus.net.au rdearden@magnus.net.au
------------------------------- -----------------------------------------------
Competent Person Statement
The information in this report that relates to the Exploration
Results, Mineral Resources or Ore Reserves is based upon
information compiled by Mr Trevor Pilcher, who is a full time
employee of the Company and is a member of The Australasian
Institute of Mining and Metallurgy. Mr Pilcher has sufficient
experience relevant to the style of mineralisation and type of
deposit under consideration and the activity in which he is
undertaking to qualify as a Competent Person under 2012 Edition of
the Australasian Code for Reporting Exploration Results, Mineral
Resources and Ore Reserves (JORC Code). Mr Pilcher consents to the
inclusion in this report of the matters based on his information in
the form and context in which it appears.
The information in this report that relates to the Exploration
Results, Mineral Resources or Ore Reserves was prepared and first
disclosed under the JORC Code 2004. It has not been updated since
to comply with the JORC Code 2012 on the basis that the information
has not materially changed since it was last reported.
All material assumption and technical parameters underpinning
the estimates of mineral resources continue to apply and have not
materially changed.
Rule 5.3
Appendix 5B
Mining exploration entity quarterly report
Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98,
30/9/01, 01/06/10, 17/12/10
Name of entity
BULLABULLING GOLD LIMITED
-------------------------
ABN Quarter ended ("current
quarter")
50 153 234 532 31 DECEMBER 2013
-------------- -----------------------
Consolidated statement of cash flows
Current quarter Year to date
Cash flows related to operating $A'000 (12 months)
activities
$A'000
---------------- -------------
1.1 Receipts from product sales - -
and related debtors
Payments for (a) exploration
and evaluation (650) (3,732)
(b) development - -
(c) production - -
1.2 (d) administration (491) (2,401)
1.3 Dividends received - -
Interest and other items of
1.4 a similar nature received 53 244
1.5 Interest and other costs of - -
finance paid
1.6 Income taxes received / (paid) - (1)
1.7 Other - stamp duty - (1,415)
-- R&D tax incentive - 4,539
-- MRF environmental bond
release - 1,275
Net Operating Cash Flows (1,088) (1,491)
----- -------------------------------------- ---------------- -------------
Cash flows related to investing
activities
Payment for (a) prospects - -
purchases of: (b) equity investments - -
1.8 (c) other fixed assets (1) (156)
1.9 Proceeds from (a) prospects - -
sale of: (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) (156)
---------------- -------------
Total operating and investing
cash flows
1.13 (carried forward) (1,089) (1,647)
----- -------------------------------------- ---------------- -------------
Total operating and investing
cash flows
1.13 (brought forward) (1,089) (1,647)
----- ----------------------------------
Cash flows related to financing
activities
Proceeds from issues of shares,
1.14 options, etc. - 2,000
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 - capital raising costs - (174)
---------- ----------
Net financing cash flows - 1,826
----- ---------------------------------- ----------
Net increase (decrease) in
cash held (1,089) 179
Cash at beginning of quarter/year
1.20 to date 5,349 4,079
Exchange rate adjustments
1.21 to item 1.20 - 2
---------- ----------
1.22 Cash at end of quarter 4,260 4,260
----- ---------------------------------- ---------- ----------
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
----------------
Aggregate amount of payments to the parties
1.23 included in item 1.2 322
----------------
1.24 Aggregate amount of loans to the parties -
included in item 1.10
-------- -------------------------------------------------- ----------------
1.25 Explanation necessary for an understanding of the transactions
1.23 - Includes salaries paid to directors, as well
as superannuation paid on behalf of directors and senior
executives.
-----------------------------------------------------------------------------
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
None
-------------------------------------------------------
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
None
------------------------------------------------------------
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 700
-------
4.2 Development -
-------
4.3 Production -
-------
4.4 Administration 500
---- --------------------------- -------
Total 1,200
---- --------------------------- -------
Reconciliation of cash
Reconciliation of cash at the Current quarter Previous quarter
end of the quarter (as shown $A'000 $A'000
in the consolidated statement
of cash flows) to the related
items in the accounts is as follows.
---------------------------------------- ---------------- -----------------
5.1 Cash on hand and at bank 1,458 4,074
---------------- -----------------
5.2 Deposits at call 2,802 1,275
---------------- -----------------
5.3 Bank overdraft - -
---------------- -----------------
5.4 Other (provide details) - -
---------------- -----------------
Total: cash at end of quarter
(item 1.22) 4,260 5,349
----- --------------------------------- ---------------- -----------------
Changes in interests in mining tenements
Tenement Nature of interest Interest Interest
reference (note (2)) at beginning at end
of quarter of quarter
----------- ------------------- -------------- ------------
6.1 Interests in
mining tenements
relinquished, N/A
reduced or
lapsed
----------- ------------------- -------------- ------------
6.2 Interests in N/A
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 Number quoted Issue price Amount paid
per security up per security
(see note (see note 3)
3) (cents) (cents)
--------------------------- ------------- -------------- -------------- -----------------
7.1 Preference
+securities
(description)
------------- -------------- -------------- -----------------
7.2 Changes during
quarter
(a) Increases
through issues
(b) Decreases
through returns
of capital,
buy-backs,
redemptions
----- -------------------- ------------- -------------- -------------- -----------------
+Ordinary
securities
7.3 ** 342,248,780 342.248,780
------------- -------------- -------------- -----------------
7.4 Changes during
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
Options
(description Exercise
and conversion price Expiry date
7.7 factor) 15,859,242 - Various Various
------------- -------------- -------------- -----------------
Issued during 26 November
7.8 quarter 500,000 - 10.2 cents 2014
------------- -------------- -------------- -----------------
7.9 Exercised
during 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
5).
2 This statement does give a true and fair view of the matters disclosed.
Sign here: Date: 29 January 2014
Company Secretary
Print name: David M McArthur
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 6: Exploration for
and Evaluation of Mineral Resources and AASB 107: Statement of Cash
Flows apply to this report.
5 Accounting Standards ASX will accept, for example, the use of
International Financial Reporting Standards for foreign entities.
If the standards used do not address a topic, the Australian
standard on that topic (if any) must be complied with.
TENEMENTS LISTING AT 31 DECEMBER 2013
Bullabulling Gold Limited has used the cash and assets in a form
readily convertible to cash, that it had at the time of admission
to the Australian Securities Exchange, in a manner consistent with
Bullabulling Gold Limited's business objectives
Tenement Description Tenement Numbers Percentage
Interest
Bullabulling Project - Coolgardie
District E15/1263 100%
Bullabulling Project - Coolgardie
District E15/1264 100%
Bullabulling Project - Coolgardie
District E15/1320 100%
Bullabulling Project - Coolgardie
District E15/1331 100%
Bullabulling Project - Coolgardie
District E15/1349 100%
Bullabulling Project - Coolgardie
District E15/1350 100%
Bullabulling Project - Coolgardie
District L15/156 100%
Bullabulling Project - Coolgardie
District L15/157 100%
Bullabulling Project - Coolgardie
District L15/158 100%
Bullabulling Project - Coolgardie
District L15/196 100%
Bullabulling Project - Coolgardie
District L15/206 100%
Bullabulling Project - Coolgardie
District L15/218 100%
Bullabulling Project - Coolgardie
District L15/222 100%
Bullabulling Project - Coolgardie
District L15/328 100%
Bullabulling Project - Coolgardie
District L15/330 100%
Bullabulling Project - Coolgardie
District L15/331 100%
Bullabulling Project - Coolgardie
District L15/332 100%
Bullabulling Project - Coolgardie
District L15/333 100%
Bullabulling Project - Coolgardie
District L15/334 100%
Bullabulling Project - Coolgardie
District L15/335 100%
Bullabulling Project - Coolgardie
District L15/336 100%
Bullabulling Project - Coolgardie
District L15/339 100%
Bullabulling Project - Coolgardie
District M15/282 100%
Bullabulling Project - Coolgardie
District M15/483 100%
Bullabulling Project - Coolgardie
District M15/503 100%
Bullabulling Project - Coolgardie
District M15/529 100%
Bullabulling Project - Coolgardie
District M15/552 100%
Bullabulling Project - Coolgardie
District M15/554 100%
Bullabulling Project - Coolgardie
District M15/1414 100%
Bullabulling Project - Coolgardie
District M15/4798 100%
Bullabulling Project - Coolgardie
District P15/4799 100%
Bullabulling Project - Coolgardie
District P15/4887 100%
Bullabulling Project - Coolgardie
District P15/5186 100%
Bullabulling Project - Coolgardie
District P15/5187 100%
Bullabulling Project - Coolgardie
District P15/5188 100%
Bullabulling Project - Coolgardie
District P15/5354 100%
Bullabulling Project - Coolgardie
District P15/5355 100%
Bullabulling Project - Coolgardie
District P15/5356 100%
Bullabulling Project - Coolgardie
District P15/5357 100%
Bullabulling Project - Coolgardie
District P15/5358 100%
Bullabulling Project - Coolgardie
District P15/5381 100%
Bullabulling Project - Coolgardie
District P15/5382 100%
Bullabulling Project - Coolgardie
District P15/5383 100%
Bullabulling Project - Coolgardie
District P15/5384 100%
Bullabulling Project - Coolgardie
District P15/5385 100%
Bullabulling Project - Coolgardie
District P15/5386 100%
Bullabulling Project - Coolgardie
District P15/5387 100%
Bullabulling Project - Coolgardie
District P15/5388 100%
Bullabulling Project - Coolgardie
District P15/5512 100%
Bullabulling Project - Coolgardie
District P15/5513 100%
Bullabulling Project - Coolgardie
District P15/5514 100%
Bullabulling Project - Coolgardie
District P15/5515 100%
Bullabulling Project - Coolgardie
District P15/5516 100%
Bullabulling Project - Coolgardie
District P15/5533 100%
Bullabulling Project - Coolgardie
District P15/5535 100%
Bullabulling Project - Coolgardie
District P15/5538 100%
Bullabulling Project - Coolgardie
District P15/5539 100%
Bullabulling Project - Coolgardie
District P15/5540 100%
Bullabulling Project - Coolgardie
District P15/5541 100%
Bullabulling Project - Coolgardie
District P15/5567 100%
Bullabulling Project - Coolgardie
District P15/5661 100%
Bullabulling Project - Coolgardie
District P15/5662 100%
Bullabulling Project - Coolgardie
District P15/5663 100%
Bullabulling Project - Coolgardie
District P15/5664 100%
Bullabulling Project - Coolgardie
District P15/5669 100%
Bullabulling Project - Coolgardie
District P15/5673 100%
Bullabulling Project - Coolgardie
District P15/5674 100%
Bullabulling Project - Coolgardie
District P15/5758 100%
Bullabulling Project - Coolgardie
District P15/5799 100%
Bullabulling Project - Coolgardie
District P15/5800 100%
Bullabulling Project - Coolgardie
District P15/5802 100%
----------------------------------- ------------------ -----------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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