TIDMBKY
RNS Number : 6176K
Berkeley Energia Limited
23 April 2020
BERKELEY ENERGIA LIMITED
NEWS RELEASE | 23 April 2020 | ASX / LSE / BdM : BKY
Quarterly Report March 2020
Summary:
-- Permitting Update:
The Company's focus continues to be on progressing the approvals
required to commence construction of the Salamanca mine and bring
it into production.
The Company continued to engage with the relevant authorities in
a collaborative manner in order to facilitate the timely resolution
of the pending approvals required to commence construction of the
mine.
The Company's Spanish executives have met and had constructive
dialogue with officials from the Nuclear Safety Council ("NSC"),
the Regional Government of Castilla y Leon, and the Municipality of
Retortillo during the quarter.
In late March, the Company formally submitted the updated
official documentation in relation to the Authorisation for
Construction ("NSC II") to the NSC. The next step in the process is
for the NSC technical team to complete its report and submit it to
the NSC Board for ratification.
The Ministry of Environment and Development of the Regional
Government of Castilla y León informed the Municipality of
Retortillo and the Company in March that the previously granted
Authorisation of the Exceptional Land Use, a perquisite for the
award of the Urbanism Licence ("UL"), remains fully valid and
enforceable. This resolution allows the Municipality of Retortillo
to advance the processing of the Company's UL application.
-- Uranium Market:
The uranium spot price has risen to US$32.50 per pound on
uncertainty surrounding COVID-19 impacts to the nuclear fuel supply
chain. This represents a year to date uranium price increase of
30%.
During and subsequent to the quarter, COVID-19 related supply
disruptions were announced by a number of major uranium producers,
including Kazatomprom and Cameco.
Analysts expect further tightening of market conditions as the
current structural supply deficit in the global uranium market is
exacerbated by these and possible other COVID-19 supply
disruptions.
-- COVID-19:
In response to the COVID-19 pandemic, the Spanish Government
declared a National 'State of Alarm' on 14 March 2020 and the
associated measures came into effect on 15 March 2020.
The Spanish Government suspended the term for all administrative
and legal proceedings while the 'State of Alarm' is active however,
the Spanish Administration is still functioning and Berkeley has
maintained ongoing communication with the relevant officials from
the NSC, the Regional Government of Castilla y Leon, and the
Municipality of Retortillo to ensure the permitting processes
continues to advance.
All of Company's team based in Spain are safe and well.
Management was well prepared and implemented a 'work from home'
policy a week prior to the government declaring the 'State of
Alarm'.
For further information please contact:
Robert Behets Franciso Bellón
Acting Managing Director Chief Operations Officer
+61 8 9322 6322 +34 91 555 1380
info@berkeleyenergia.com
Project Update:
The Salamanca mine is being developed to the highest
international standards and the Company's commitment to health,
safety and the environment remains a priority. It holds
certificates in Sustainable Mining (UNE 22470-80), Environmental
Excellence (ISO 14001), and Health and Safety (OHSAS 18001) which
were awarded by AENOR, an independent Spanish government
agency.
The annual external audit of the Company's Sustainable Mining
and Environmental Management Systems was successfully completed by
AENOR during the quarter.
As part of its commitment to Sustainable Mining, the Company has
commenced a Life Cycle Analysis of its operational processes, in
order to determine the environmental impact of the products
associated with these processes from their origin (raw materials)
through to the end of their useful life. During the quarter, this
initiative has focused on the analysis of the environmental impact
of carbon dioxide ("CO(2) ") emissions generated by exploration
drilling activities.
Following completion of the annual external audit of the
Company's Health and Safety Management System by AENOR in late
2019, the Company has now commenced the migration from OHSAS 18001
to its replacement standard, ISO 45001, a process which is targeted
for completion in the second half of 2020.
The monitoring programs associated with the NSC approved
pre-operational Surveillance Plan for Radiological and
Environmental Affections and pre-operational Surveillance Plan for
the Control of the Underground Water continued during the
quarter.
Permitting Update:
The Company continues to engage with the relevant authorities in
a collaborative manner in order to facilitate the timely resolution
of the pending approvals required to commence construction of the
Salamanca mine.
During the quarter, the Company's Spanish executives have again
met and had constructive dialogue with relevant officials from the
NSC, the Regional Government of Castilla y León, and the
Municipality of Retortillo.
The Company has also provided the NSC and the Ministry for
Ecological Transition and Demographic Challenge ("MITECO") with
additional or updated technical documentation and clarifications
requested in relation to the NSC II.
At the request of the NSC, Berkeley has consolidated the
Company's responses to all of the NSC's technical queries into the
official documentation, and expanded the description of some
sections e.g. waste management, analysis of potential accidents,
environmental radiological impact assessment, hydrological
modeling. These tasks have now been completed and the updated
official documentation was formally submitted to the NSC in late
March.
The next step in the process is for the NSC technical team to
complete their report and submit it to the NSC Board for approval.
Once approved by the NSC Board, the NSC report and recommendation
which is 'compulsory and binding on radiological matters' is
provided to MITECO, who is the substantive authority responsible
for the granting NSC II.
With regard to the award of the UL, the Municipality of
Retortillo and the Company were informed by the Ministry of
Environment and Development of the Regional Government of Castilla
y León in March that the previously granted Authorisation of the
Exceptional Land Use (a perquisite for the award of the UL) remains
fully valid and enforceable. This resolution by the Minister of
Environment and Development allows the Municipality of Retortillo
to advance the processing of the Company's UL application.
In response to the COVID-19 pandemic, the Spanish Government
declared a National 'State of Alarm' on 14 March 2020 and the
associated measures came into effect on 15 March 2020.
The Spanish Government suspended the term for all administrative
and legal proceedings while the 'State of Alarm' is active.
However, the Spanish Administration is still functioning and
Berkeley has maintained ongoing remote communication with the
relevant officials from the Regional Government of Castilla y León,
and the Municipality of Retortillo and the NSC, to ensure the
permitting process continues to progress.
The Company will continue to maintain a consistent approach,
ensuring that the project complies with all applicable laws and
regulations, as it progresses the approvals required to commence
construction of the Salamanca mine and bring it into
production.
Uranium market:
Uranium spot prices continue to rise on uncertainty surrounding
COVID-19 impacts to the nuclear fuel supply chain.
During and subsequent to the quarter, COVID-19 related supply
disruptions were announced by Kazatomprom (Kazakhstan operations),
Cameco (Cigar Lake mine), CNNC (Rössing mine) and Swakop Uranium
(Husab mine). As a result, the uranium spot price has increased to
US$32.50 per pound (17 April), representing a year to date increase
of 30%.
Analysts expect further tightening of market conditions as the
current structural supply deficit in the global uranium market is
exacerbated by these and possible other COVID-19 supply
disruptions.
Continued upward movement in the spot price may also be a
trigger for increased term market activity. Nuclear fuel buyers for
utilities typically look to secure contracts a minimum of two years
ahead of use. With a number of contracts dropping off from 2021,
buyers may step into the market, providing another possible prop to
uranium prices.
The market also continues to await the report from the United
States Nuclear Fuel Working Group ("NFWG") established following
the Section 232 trade investigation.
The Section 232 investigation into uranium imports into the
United States concluded in July 2019, with the decision that trade
barriers on uranium imports were not warranted as a matter of
national security under Section 232 of the Trade Expansion Act. The
US Administration, however, established the NFWG to examine the
entire nuclear fuel supply chain and conduct a fuller analysis of
national security issues therein.
The NFWG was required to submit a report setting forth its
findings and making recommendations to further enable domestic
nuclear fuel production if needed. News reports last quarter
indicated that the NFWG report had been submitted to the US
Administration, after an extension to the original mandate period.
The report was expected to be released during March however, the
emergence of the COVID-19 pandemic has further delayed the report's
availability.
Release of the NFWG's findings and recommendations is expected
reduce the market uncertainty associated with this policy review
process and contribute to improved market conditions moving
forward, as US nuclear utilities, in particular, re-enter the
market and term contracting in order to address future uncovered
uranium requirements.
The Company has 2.00 million pounds of U(3) O(8) under contract
for the first five years of production, with a further 1.30 million
pounds of optional volume during this period and a two-year
extension, at an average price above US$42 per pound. Subsequent to
the end of the quarter, a small offtake contract for 0.75 million
pounds of U(3) O(8) was terminated.
The Company will continue to progressively build its offtake
book and has granted the Oman sovereign wealth fund the right to
match any future long-term offtake transactions.
COVID-19:
In response to the COVID-19 pandemic, the Spanish Government
declared a National 'State of Alarm' on 14 March 2020 and the
associated measures came into effect on 15 March 2020.
Specifically, with regard to Berkeley, all of its Spanish team
are safe and well. Management was well prepared and implemented a
'work from home' policy a week prior to the government declaring
the 'State of Alarm'.
Whilst face to face meetings have not been possible, regular
communication is being maintained between the company and the NSC,
the regional government and local municipality, to ensure the key
permitting processes continue to advance (as noted above).
Balance Sheet:
The Company is in a strong financial position with A$104 million
in cash.
Forward Looking Statements
Statements regarding plans with respect to Berkeley's mineral
properties are forward-looking statements. There can be no
assurance that Berkeley's plans for development of its mineral
properties will proceed as currently expected. There can also be no
assurance that Berkeley will be able to confirm the presence of
additional mineral deposits, that any mineralisation will prove to
be economic or that a mine will successfully be developed on any of
Berkeley mineral properties. These forward-looking statements are
based on Berkeley's expectations and beliefs concerning future
events. Forward looking statements are necessarily subject to
risks, uncertainties and other factors, many of which are outside
the control of Berkeley, which could cause actual results to differ
materially from such statements. Berkeley makes no undertaking to
subsequently update or revise the forward-looking statements made
in this announcement, to reflect the circumstances or events after
the date of that announcement.
This announcement has been authorised for release by Mr Robert
Behets, Director.
Appendix 1: Summary of Mining Tenements
As at 31 March 2020, the Company had an interest in the
following tenements:
Location Tenement Name Percentage Status
Interest
--------------- ------------------------- ------------ --------
Spain
Salamanca D.S.R Salamanca 28 100% Granted
(Alameda)
D.S.R Salamanca 29 100% Granted
(Villar)
E.C. Retortillo-Santidad 100% Granted
E.C. Lucero 100% Pending
I.P. Abedules 100% Granted
I.P. Abetos 100% Granted
I.P. Alcornoques 100% Granted
I.P. Alisos 100% Granted
I.P. Bardal 100% Granted
I.P. Barquilla 100% Granted
I.P. Berzosa 100% Granted
I.P. Campillo 100% Granted
I.P. Casta ñ 100% Granted
os 2
I.P. Ciervo 100% Granted
I.P. Dehesa 100% Granted
I.P. El Á guila 100% Granted
I.P. El Vaqueril 100% Granted
I.P. Espinera 100% Granted
I.P. Horcajada 100% Granted
I.P. Lis 100% Granted
I.P. Mailleras 100% Granted
I.P. Mimbre 100% Granted
I.P. O ñ oro 100% Granted
I.P. Pedreras 100% Granted
E.P. Herradura 100% Granted
I.P. Conchas Application Pending
C á ceres I.P. Almendro 100% Granted
I.P. Ibor 100% Granted
I.P. Olmos 100% Granted
Badajoz I.P. Don Benito Este 100% Granted
I.P. Don Benito Oeste 100% Granted
--------------- ------------------------- ------------ --------
An Investigation Permit for El Vaqueril was awarded while an
application for an Investigation Permit for Lazarillo was not
granted to the Company during the quarter ended 31 March 2020.
There were no other changes to beneficial interest in any mining
tenements due to farm-in or farm-out agreements. No beneficial
interest in farm-in or farm-out agreements were acquired or
disposed during the quarter .
Appendix 2: Related Party Payments
During the quarter ended 31 March 2020, the Company made
payments of $79,497 to related parties and their associates. These
payments relate to existing remuneration arrangements (director and
consulting fees plus statutory superannuation).
Appendix 5B
Mining exploration entity or oil and gas exploration entity
quarterly cash flow report
Name of entity
-----------------------------------------------------
Berkeley Energia Limited
ABN Quarter ended ("current quarter")
--------------- ----------------------------------
40 052 468 569 31 March 2020
----------------------------------
Consolidated statement of cash Current quarter Year to date
flows
$A'000 (9 months)
$A'000
1. Cash flows from operating
activities
1.1 Receipts from customers - -
1.2 Payments for
(a) exploration & evaluation
(if expensed) (1,605) (4,449)
(b) development - -
(c) production - -
(d) staff costs (363) (2,059)
(e) administration and corporate
costs (136) (859)
1.3 Dividends received (see note - -
3)
1.4 Interest received 539 1,286
1.5 Interest and other costs of -
finance paid
1.6 Income taxes paid - -
1.7 Government grants and tax - -
incentives
Other (provide details if
material)
1.8 - Business Development (14) (104)
---------------- -------------
Net cash from / (used in)
1.9 operating activities (1,579) (6,185)
----- ----------------------------------- ---------------- -------------
2. Cash flows from investing
activities
2.1 Payments to acquire:
(a) entities - -
(b) tenements - -
(c) property, plant and equipment - (50)
(d) exploration & evaluation - -
(if capitalised)
(e) investments - -
(f) other non-current assets - -
2.2 Proceeds from the disposal
of:
(a) entities - -
(b) tenements - -
(c) property, plant and equipment - -
(d) investments - -
(e) other non-current assets - -
2.3 Cash flows from loans to other - -
entities
2.4 Dividends received (see note - -
3)
2.5 Other (provide details if - -
material)
---------------- -------------
Net cash from / (used in)
2.6 investing activities - (50)
----- ----------------------------------- ---------------- -------------
3. Cash flows from financing
activities
3.1 Proceeds from issues of equity
securities (excluding convertible
debt securities) - -
3.2 Proceeds from issue of convertible - -
debt securities
3.3 Proceeds from exercise of - -
options
Transaction costs related
to issues of equity securities
3.4 or convertible debt securities - (2)
3.5 Proceeds from borrowings - -
3.6 Repayment of borrowings - -
3.7 Transaction costs related
to loans and borrowings - -
3.8 Dividends paid - -
3.9 Other (provide details if - -
material)
---------------- -------------
Net cash from / (used in)
3.10 financing activities - (2)
----- ----------------------------------- ---------------- -------------
4. Net increase / (decrease)
in cash and cash equivalents
for the period
Cash and cash equivalents
4.1 at beginning of period 92,507 96,584
Net cash from / (used in)
operating activities (item
4.2 1.9 above) (1,579) (6,185)
Net cash from / (used in)
investing activities (item
4.3 2.6 above) - (50)
Net cash from / (used in)
financing activities (item
4.4 3.10 above) - (2)
Effect of movement in exchange
4.5 rates on cash held 12,759 13,340
---------------- -------------
Cash and cash equivalents
4.6 at end of period 103,687 103,687
----- ----------------------------------- ---------------- -------------
5. Reconciliation of cash and Current quarter Previous quarter
cash equivalents $A'000 $A'000
at the end of the quarter
(as shown in the consolidated
statement of cash flows) to
the related items in the accounts
5.1 Bank balances 8,398 2,689
5.2 Call deposits 95,289 89,818
5.3 Bank overdrafts - -
5.4 Other (provide details) - -
---------------- -----------------
Cash and cash equivalents
at end of quarter (should
5.5 equal item 4.6 above) 103,687 92,507
---- ----------------------------------- ---------------- -----------------
1.
6. Payments to related parties of the entity Current quarter
and their associates $A'000
Aggregate amount of payments to related
parties and their associates included in
6.1 item 1 (79)
-----------------
6.2 Aggregate amount of payments to related
parties and their associates included in -
item 2
-----------------
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly
activity report must include a description of, and an explanation
for, such payments
-------------------------------------------------------------------------
7. Financing facilities Total facility
Note: the term "facility' amount at quarter Amount drawn
includes all forms of financing end at quarter end
arrangements available to $A'000 $A'000
the entity.
Add notes as necessary for
an understanding of the sources
of finance available to the
entity.
7.1 Loan facilities - -
------------------- ----------------
7.2 Credit standby arrangements - -
------------------- ----------------
7.3 Other (please specify) - -
------------------- ----------------
7.4 Total financing facilities - -
------------------- ----------------
7.5 Unused financing facilities available at -
quarter end
----------------
7.6 Include in the box below a description of each facility
above, including the lender, interest rate, maturity date
and whether it is secured or unsecured. If any additional
financing facilities have been entered into or are proposed
to be entered into after quarter end, include a note providing
details of those facilities as well.
---- ------------------------------------------------------------------------
Not applicable
8. Estimated cash available for future operating $A'000
activities
Net cash from / (used in) operating activities
8.1 (Item 1.9) (1,580)
8.2 Capitalised exploration & evaluation (Item -
2.1(d))
8.3 Total relevant outgoings (Item 8.1 + Item (1,580)
8.2)
8.4 Cash and cash equivalents at quarter end 103,687
(Item 4.6)
8.5 Unused finance facilities available at quarter -
end (Item 7.5)
8.6 Total available funding (Item 8.4 + Item 103,687
8.5)
Estimated quarters of funding available
8.7 (Item 8.6 divided by Item 8.3) 66
---- --------------------------------------------------------
8.8 If Item 8.7 is less than 2 quarters, please provide answers
to the following questions:
1. Does the entity expect that it will continue to have
the current level of net operating cash flows for the
time being and, if not, why not?
-------------------------------------------------------------------
Answer: Not applicable
-------------------------------------------------------------------
2. Has the entity taken any steps, or does it propose
to take any steps, to raise further cash to fund its operations
and, if so, what are those steps and how likely does it
believe that they will be successful?
-------------------------------------------------------------------
Answer: Not applicable
-------------------------------------------------------------------
3. Does the entity expect to be able to continue its operations
and to meet its business objectives and, if so, on what
basis?
-------------------------------------------------------------------
Answer: Not applicable
-------------------------------------------------------------------
Compliance statement
1 This statement has been prepared in accordance with accounting
standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters disclosed.
Date: 23 April 2020
Authorised by: Company Secretary
(Name of body or officer authorising release - see note 4)
Notes
1. This quarterly cash flow report and the accompanying activity
report provide a basis for informing the market about the entity's
activities for the past quarter, how they have been financed and
the effect this has had on its cash position. An entity that wishes
to disclose additional information over and above the minimum
required under the Listing Rules is encouraged to do so.
2. If this quarterly cash flow report has been prepared in
accordance with Australian Accounting Standards, 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. If this quarterly cash flow report has been prepared
in accordance with other accounting standards agreed by ASX
pursuant to Listing Rule 19.11A, the corresponding equivalent
standards apply to this report.
3. Dividends received may be classified either as cash flows
from operating activities or cash flows from investing activities,
depending on the accounting policy of the entity.
4. If this report has been authorised for release to the market
by your board of directors, you can insert here: "By the board". If
it has been authorised for release to the market by a committee of
your board of directors, you can insert here: "By the [name of
board committee - eg Audit and Risk Committee]". If it has been
authorised for release to the market by a disclosure committee, you
can insert here: "By the Disclosure Committee".
5. If this report has been authorised for release to the market
by your board of directors and you wish to hold yourself out as
complying with recommendation 4.2 of the ASX Corporate Governance
Council's Corporate Governance Principles and Recommendations, the
board should have received a declaration from its CEO and CFO that,
in their opinion, the financial records of the entity have been
properly maintained, that this report complies with the appropriate
accounting standards and gives a true and fair view of the cash
flows of the entity, and that their opinion has been formed on the
basis of a sound system of risk management and internal control
which is operating effectively.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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