More annual reports from Alara Resources Limited:
2021 Report2020
A N N U A L R E P O R T
Saudi Arabia
Oman
With our first copper mining
licence in hand, the Company
is officially advancing from
mineral exploration, to mine
development and copper
concentrate production.
Saudi Arabia
Oman
With our first copper mining
licence in hand, the Company
is officially advancing from
mineral exploration, to mine
development and copper
concentrate production.
Alara Resources Limited
Mission Statement
Our mission is to increase shareholder value as a leading developer
of mineral deposits and a mineral producer in the Middle East Region
Core Values
Contents
Excellence
We continue to strive for
improvement and in all aspects
of our business and ensure
our employees and business
partners share this commitment.
Respect
Alara shows consideration for its
employees, business partners,
service providers, governments,
communities, and the physical
environment in which it
operates.
Integrity
Alara operates with
transparency, honesty and
accountability across all levels
2 Managing Director’s Letter
4 Projects Overview
23 Board of Directors
25 Management Support Team
31 Directors’ Report
48 Independent Auditor’s Declaration
49 Consolidated Statement of Profit of Loss
and other Comprehensive Income
50 Consolidated Statement of Financial Position
51 Consolidated Statement of Changes in Equity
52 Consolidated Statement of Cash Flows
53 Notes to the Financial Statements
72 Directors’ Declaration
73 Independent Auditor’s Report
77 JORC Competent Persons Statements
79
80
Securities Information
Corporate Directory
1
Alara Resources Annual Report 2020
Managing Director’s Letter
I thank Shareholders for their trust and faith in Alara Resources this year as it addresses the
unprecedented challenges posed by the global Covid-19 pandemic, and continues its journey
to become a copper miner in Sultanate of Oman. AHRL LLC (AHRL) in Oman is set to re-ignite
the country’s copper industry with a new open-cut mine and processing plant to produce copper
concentrate.
In January, the Sultanate of Oman mourned the passing of the Sultan Qaboos bin Said al-Said.
Sultan Qaboos was a visionary leader, who led exceptional economic progress in Oman, while
maintaining stability, tolerance, and temperance in the Sultanate. Soon after this tragic event,
the world witnessed the succession of the Middle East’s longest-serving Monarch to HM Sayyid
Haitham bin Tariq al-Said, as new Sultan of the nation. The smooth and prompt transition of
leadership preserved the promise of ongoing stability for Oman and its ongoing renaissance
under the new leadership of Sultan Haitham.
The Company has held its course in achieving key milestones over the last twelve months. In
February and March, Alara’s 51% owned JV company AHRL LLC (AHRL) accepted project finance
offers from Bank Nizwa and Alizz Islamic Bank of Oman. These banks are providing a 20m Omani
Rial (OMR) (~AUD $80m) club loan to support AHRL’s procurement and construction of a 1mtpa
copper processing plant , associated infrastructure and mine development at the Wash-hi Majaza
project.
Due to issues with the initially proposed EP contractor and amidst rising uncertainties around filling
that role given global pandemic restrictions, the Company and its JV partners adopted a modified
development strategy. Under this strategy, the owner will have greater involvement in project
management, under the supervision of an experienced project management consultant . The
revised strategy has several advantages, including better procurement and project management
1. Alara’s ASX Announcement dated 24 January 2017 contains the information required by ASX Listing Rule
(LR) 5.16 regarding the stated production target. All material assumptions underpinning the production
target as announced on that date continue to apply and have not materially changed.
2. Refer to ASX Quarterly Activities Report for the three months ended 30 June 2020.
2
Alara Resources Annual Report 2020
controls, drawing on the strengths of Alara’s partners and more robust coordination. This strategy
is already proving to be the best option for delivering the Wash-hi Majaza project.
AHRL has strengthened its team, with the appointment of a CEO and several other key positions
filled.
Alara Resources LLC (ARL) has completed metallurgical drilling for AHRL and submitted samples
for tests to support project engineering and plant design. As a service provider, ARL continues to
bid for other drilling contract opportunities elsewhere in Oman.
Aligning its approach toward recently announced structural reforms in key Omani Ministries, and
availing itself of excellent support provided by the Government’s Implementation Support and
Follow-up Unit (ISFU) and the Program for Enhancing Economic Development (Tanfeedh) Alara
continues to advance toward copper production, scheduled for early 2022.
The Company continues to explore the best options for its strategy of copper resource
consolidation in Oman, the development of new mines in its Daris tenements and exploration of
the Block 8 license.
In Saudi Arabia, the mining sector aims to be the third pillar of industry by 2030, using the wealth
of mineral resources to attract local and global investment. The Company continues to keep all
its commercial options open to benefit from any opportunity to re-activate the Khnaiguiyah Zinc-
Copper project in that country.
A cautious story of copper and gold price recovery has been notable during the pandemic, as
both metals made up all lost ground on strong fundamentals. Copper demand continues to be
robust, while supply is being challenged by Covid-19. We at Alara remain firm believers in a
copper price uptrend.
Alara underwent a change in its Board and management structure, which are now more suitably
aligned for the execution of the Wash-hi Majaza project through to production. Amidst ongoing
global and internal changes, and guided by new Chairman Mr. Stephen Gethin, the Company
continues to grow from strength to strength, a trend which is set to continue.
I look forward to sharing key project construction updates and milestones with you throughout
the coming year.
Atmavireshwar Sthapak
Managing Director
3
Alara Resources Annual Report 2020 Projects overview
Oman
Sultanate of Oman and Copper
Since its discovery c.8000 years ago, copper has remained a key element in the development of
communities, cities and countries around the world.
Global copper consumption has increased significantly over the last century and has grown at
an average rate of 3% p.a. over the past 20 years. This growth is set to continue, with projected
growth in electricity infrastructure, digital communications, electric vehicles and other renewable
energy technologies. A consensus of supply and demand forecasts demonstrate solid support
for copper prices through to 2030.
The Sultanate of Oman contains some of the most exciting geology anywhere on Earth, yet it
is largely underexplored. Most of the country is covered by desert, while the northern Oman
mountains expose some of the best-preserved ophiolitic rocks in the world. Oman’s mining
history dates back millennia, to a time when copper was mined there and traded throughout the
known world. The country was then known as “Majan” or “the land of copper”.
Copper production in Oman restarted in recent decades, however a temporary halt on new mining
licences was imposed in 2014. With the Government now focused on economic diversification,
the Public Authority for Mining (PAM) is again issuing new mining licences, with AHRL being the
first company to receive a copper mining licence since 2004. PAM plans to reignite the copper
sector in Oman, with more copper projects set to follow.
Currently, Oman’s main actively mined minerals include chromite, dolomite, limestone, gypsum,
silicon and iron. Gold and copper will soon be added to this list, with attendant downstream
industrial projects to further boost the mineral sector’s contribution to the nation’s GDP.
Recognising its huge mineral wealth potential, the Sultanate is now actively promoting the
development of its mining industry as one of its top four revenue generating sectors. Key
developments include the reorganization of the Public Authority for Mining (PAM) in 2014, the
establishment of Mineral Development of Oman (MDO) in 2016, the inclusion of mining under
Implementation Support & Follow-up Unit (ISFU) of Tanfeedh in 2017 and the promulgation of a
new Mining Law in 2018. These developments demonstrate the country’s commitment to assisting
the mining sector become one of the major non-petroleum revenue sources for the nation.
AHRL LLC (AHRL) – a joint venture between Alara Resources (51%), and Omani conglomerates
Al Hadeetha Investment Services LLC (AHIS) (30%) and Al Tasnim Infrastructure LLC (Al Tasnim)
(19%) – is the first international JV company to be awarded a mining license for copper in Oman.
Alara has joint venture interests in a total of five copper-gold exploration licenses in Oman,
extending over 1186km2. In addition, Alara has a 51% interest (via its shareholding in AHRL) in
the Al Hadeetha Mining License at Wash-hi Majaza covering 3km2, within the Wash-hi Exploration
License, and four other mining license applications pending for grant, totaling 7km2. The next
figure shows the locations of all exploration licenses in Oman, including Alara’s JV license areas.
Alara also has another 10 (base and precious metals) exploration license applications, totalling
2,677km2, pending grant in Oman.
4
Alara Resources Annual Report 2020
Oman Copper Block & Alara JV Exploration Licenses in Oman
Alara also has another 10 (base and precious metals) exploration license applications pending
grant, totaling 2,677km2 in Oman.
5
Alara Resources Annual Report 2020 [Amit: please insert headers and footers the same as the 2019 version send for comparison.]
Alara Oman Copper Portfolio
Al Hadeetha Resources LLC Projects
Alara Oman Copper Portfolio
Al Hadeetha Resources LLC (AHRL) is a Joint Venture (JV), between Alara Oman Operations Pty Ltd
Al Hadeetha Resources LLC Projects
(51%), a wholly owned subsidiary of Alara Resources, Al Hadeetha Investment Services LLC (AHIS) (30%)
and Al Tasnim Infrastructure LLC (19%). AHIS related to the well-known Al Naba Services group, owned by
Alara’s JV partner in AHRL, AHIS, is part of the well-known Omani conglomerate Al Naba Services group,
Sayyid Khalid bin Hamed Al Busaidi and his family. The owners of Al Tasnim represent the Al Turki group,
owned by Sayyid Khalid bin Hamed Al Busaidi and his family. The owners Alara’s other JV partner, Al Tasnim,
one of the largest construction and infrastructure companies in Oman. The JV was formed in 2011 by Alara
represent the Al Turki group, one of the largest construction and infrastructure companies in Oman. The
and AHIS for the purpose of exploring and developing the Wash-hi, Mullaq and Al Ajal copper- gold
concessions and the surrounding regions. Al Tasnim joined the JV in 2018.
AHRL JV was formed in 2011 by Alara and AHIS for the purpose of exploring and developing the Wash-hi,
Mullaq and Al Ajal copper-gold concessions and the surrounding regions. Al Tasnim joined the JV in 2018.
Since 2011, Alara-led exploration in these areas has identified copper resources. Mining license
Since 2011, Alara-led exploration in these areas has identified copper resources. Mining license applications
applications have been submitted within each exploration license area. Table 1 provides the status of all Al
Hadeetha JV licenses, together forming the Al Hadeetha Copper Project (also known as the Wash-hi
have been submitted within each exploration license area. The below provides the status of all Al Hadeetha
Project).
JV licenses, together forming the Al Hadeetha Copper Project (also known as the Wash-hi Project).
Block/License
Exploration Licenses
Mining License within ELs
Name
License
owner
Alara
share
Area Date of
Grant
Expiry
Date
Status
Area
Renewal
applied
for
Wadi
Andam
AHRL
51%
39km
Mullaq
AHRL
51%
41km
Al Ajal
AHRL
51%
25km
2
2
2
Jan 2008
Jan 2016 May 2018 Deemed
granted
Oct 2009 Oct 2016 April 2018 In process
2
3km
2
1km
Jan 2008
Jan 2016 April 2018 In process
1.5km
2
Jan
2013
Date of
Applicat
ion
April
2013
Jan
2013
Status
Granted
2018
In process
In process
Table 1: Al Hadeetha JV licenses
Al Hadeetha JV licenses
The Wash-hi Majaza copper deposit lies within Wash-hi Exploration License, approximately 160 kilometers
The Wash-hi Majaza copper deposit lies within Wash-hi Exploration License, approximately 160
south-east of Muscat via a sealed road. It can be reached either from the Muscat-Nizwa highway, 40km to
kilometers south-east of Muscat via a sealed road. It is distinguished by a gossan, which forms an
the northwest, or from the Muscat-Ibra highway, 45km north along the Wadi Andam valley. This project is
isolated but conspicuous hill in the centre of a gravel plain.
5km north of Wash-hi village and 2 kilometres west of Wadi Andam. It is distinguished by its gossan, which
forms an isolated but conspicuous hill in the centre of a gravel plain. The site is located near the village of
Khadra Bin Daffa, on the road between Izki and Sinaw. Access to the prospect can be gained by four-
wheel-drive, by crossing the Wadi Andam after turning south at the Natural park sign immediately west of
Khadra Bin Daffa.
Figure 2: Wash-hi Exploration License and Washi-hi Majaza Mining License
Wash-hi Exploration License and Washi-hi Majaza Mining License
[Pink line, which appears in certain footers, to be removed]
6
3 Exploration Licence.
4 Mining Licence
Alara Resources Annual Report 2020
[Amit: please insert headers and footers the same as the 2019 version send for comparison.]
Alara Oman Copper Portfolio
Al Hadeetha Resources LLC Projects
Al Hadeetha Resources LLC (AHRL) is a Joint Venture (JV), between Alara Oman Operations Pty Ltd
(51%), a wholly owned subsidiary of Alara Resources, Al Hadeetha Investment Services LLC (AHIS) (30%)
and Al Tasnim Infrastructure LLC (19%). AHIS related to the well-known Al Naba Services group, owned by
Sayyid Khalid bin Hamed Al Busaidi and his family. The owners of Al Tasnim represent the Al Turki group,
one of the largest construction and infrastructure companies in Oman. The JV was formed in 2011 by Alara
and AHIS for the purpose of exploring and developing the Wash-hi, Mullaq and Al Ajal copper- gold
concessions and the surrounding regions. Al Tasnim joined the JV in 2018.
Since 2011, Alara-led exploration in these areas has identified copper resources. Mining license
applications have been submitted within each exploration license area. Table 1 provides the status of all Al
Hadeetha JV licenses, together forming the Al Hadeetha Copper Project (also known as the Wash-hi
Project).
Block/License
Name
Wadi
Andam
License
owner
Alara
share
Area Date of
Grant
Expiry
Date
Status
Area
Date of
Applicat
Status
Exploration Licenses
Mining License within ELs
AHRL
51%
39km
Jan 2008
Jan 2016 May 2018 Deemed
3km
Renewal
applied
for
granted
Mullaq
AHRL
51%
41km
Oct 2009 Oct 2016 April 2018 In process
1km
Al Ajal
AHRL
51%
25km
Jan 2008
Jan 2016 April 2018 In process
2
1.5km
Jan
In process
Table 1: Al Hadeetha JV licenses
The Wash-hi Majaza copper deposit lies within Wash-hi Exploration License, approximately 160 kilometers
south-east of Muscat via a sealed road. It can be reached either from the Muscat-Nizwa highway, 40km to
the northwest, or from the Muscat-Ibra highway, 45km north along the Wadi Andam valley. This project is
5km north of Wash-hi village and 2 kilometres west of Wadi Andam. It is distinguished by its gossan, which
forms an isolated but conspicuous hill in the centre of a gravel plain. The site is located near the village of
Khadra Bin Daffa, on the road between Izki and Sinaw. Access to the prospect can be gained by four-
wheel-drive, by crossing the Wadi Andam after turning south at the Natural park sign immediately west of
Khadra Bin Daffa.
Granted
2018
In process
2
2
ion
April
2013
Jan
2013
2013
2
2
2
[Amit: please insert headers and footers the same as the 2019 version send for comparison.]
[Amit: please insert headers and footers the same as the 2019 version send for comparison.]
Wash-hi Majaza project site with ARL drilling rig in operation.
AHRL conducted extensive copper-gold exploration programs in the license area, resulting in the
Image 1: Wash-hi Majaza project site with ARL drilling rig in operation.
discovery of a large copper deposit at Wash-hi Majaza. A subsequent feasibility study supported
Image 1: Wash-hi Majaza project site with ARL drilling rig in operation.
Al Hadeetha Resources conducted extensive copper-gold exploration programs in the license area resulting
development of an open mine pit and construction of 1mtpa copper concentration plant . In June
in the discovery of a large copper deposit at Wash-hi Majaza. A subsequent feasibility study supported
Al Hadeetha Resources conducted extensive copper-gold exploration programs in the license area resulting
2018 AHRL secured its first Mining License and commenced the process of mine development.
development of an open mine pit and construction of 1MTPA copper concentration plant. In June 2018 Al
in the discovery of a large copper deposit at Wash-hi Majaza. A subsequent feasibility study supported
Resource and reserve statements are provided in Tables 2 and 3 below.
Hadeetha Resources secured its first Mining License and proceeded to mine development. JORC resource
development of an open mine pit and construction of 1MTPA copper concentration plant. In June 2018 Al
Mineralisation in the gossan was also identified (JORC Inferred Resource of 0.31MT @ 0.51g/t Au)
and reserve statements are provided in Tables 2 and 3 below.
Hadeetha Resources secured its first Mining License and proceeded to mine development. JORC resource
outside the main ore body.
and reserve statements are provided in Tables 2 and 3 below.
Mineralisation in the gossan was also identified (JORC Inferred Resource of 0.31MT @ 0.51g/t Au) outside
the main ore body.
Mineralisation in the gossan was also identified (JORC Inferred Resource of 0.31MT @ 0.51g/t Au) outside
the main ore body.
Resource
Indicated
Resource
Inferred
Indicated
Total
Inferred
Table 2: Mineral Resources Summary – 0.25% Cu Cut-off
Total
Mineral Resources summary – 0.25% Cu Cut-off
Table 2: Mineral Resources Summary – 0.25% Cu Cut-off
JORC Category
Probable Reserve
JORC Category
Table 3: JORC Ore Reserve Statement
Probable Reserve
Table 3: JORC Ore Reserve Statement
Ore Reserve statement
Tonnes (m)
12.4
Tonnes (m)
3.7
12.4
16.1
3.7
16.1
Tonnes (m)
9.70
Tonnes (m)
9.70
Cu %
0.89
Cu %
0.79
0.89
0.87
0.79
0.87
Au g/t
0.22
Au g/t
0.22
Cu %
0.88
Cu %
0.88
Figure 2: Wash-hi Exploration License and Washi-hi Majaza Mining License
[Pink line, which appears in certain footers, to be removed]
7
[Pink line, which appears in certain footers, to be removed]
[Pink line, which appears in certain footers, to be removed]
Alara Resources Annual Report 2020
Wash-hi Majaza copper deposit outline
Wash-hi Majaza pit stages schematic
Wash-hi Majaza Copper Project Development
Alara is developing a 1mtpa copper concentration plant at the Wash-hi Majaza mining licence
site. Due to issues with the EP contractor which the AHRL JV initially proposed to use, and amidst
COVID-19 caused challenges in filling that role, including airport closures, travel restrictions,
shipping delays and similar issues affecting appointment of an EP contractor, AHRL decided upon
a modified project development strategy. AHRL opted for a mix of an E + PMC strategy for the
6 Alara’s ASX Announcement dated 24 January 2017 contains the information required by ASX Listing Rule
(LR) 5.16 regarding the stated production target. All material assumptions underpinning the production target as
announced on that date continue to apply and have not materially changed
8
Alara Resources Annual Report 2020
process plant construction and an EPC strategy for the construction of the remainder of the project
infrastructure, under the supervision of an experienced project management consultant, Progesys
International LLC. Under this strategy, AHRL as project owner will have greater involvement in
project management.
The revised strategy has several advantages, including better procurement and project
management controls; drawing on the strengths of Alara’s partners and more robust coordination.
Key Strategy Benefits
•
•
•
•
Scope of Works
More focussed implementation process
Most widely adopted project execution strategy across the globe
Better owner control over procurement and selection of equipment suppliers
Involvement of external PM Contractor from design to commissioning
PM Contractor Services
The Project Management Contractor (PM Contractor) will be responsible for the following:
•
•
•
•
•
•
Project management
Project controls and reporting
Engineering
Procurement management
Construction management
Commissioning supervision
Project Management
•
•
•
•
•
Development and management of overall project implementation
Management of consultants, contractors and suppliers
Preparing contract scope of work documents
Document control
Client reporting
Project Controls
•
Development and maintenance of project schedule and Gantt charts for design,
procurement and construction
Development and maintenance of project cost control system, including budget and
actual and forecast cost during construction
Change control management during design and construction
Receipt, review and processing of supplier and contractor claims and invoices
Issue of payment certificates to AHRL for invoice payment
Procurement Management
•
•
•
•
•
Prequalification of bid lists
Development of procurement requests for expression of interest and bidder lists
Developing and maintaining records and status of tenders and awards
Tender technical and commercial evaluation and recommendation
Clarification, negotiation and recommendation for award of orders on behalf of the
Company
Expediting vendor data, vendor data review and feedback
Expediting progress of supply
Quality inspection services
Logistics management
Contract management and variation control for site works
•
•
•
•
•
•
•
•
•
9
Alara Resources Annual Report 2020
Construction Management
The Construction Management Plan will address the following:
•
•
•
•
•
•
•
contractor mobilisation
contractor HSE plans
contractor reporting
client and contractor site meetings
co-ordination with operations activities
co-ordination between contractors
quality assurance on behalf of AHRL, including contractor and supplier non-
conformance and concession request management
site technical queries and field engineering
site HSE management, auditing and reporting
site industrial relations
coordination of emergency evacuation procedures
goods receipt and issuing to contractor care and custody
•
•
•
•
•
Scope of Engineering Contractor
DSA Engineers, a major Indian engineering company, has been appointed as the Engineering
Contractor. This contractor will carry out the detailed design for the Project infrastructure, which
will include the following:
•
process
mechanical
civil
structural
architectural
piping
electrical
instrumentation
detailed design and drafting for the project in the following disciplines:
o
o
o
o
o
o
o
o
developing and maintaining datasheets, mechanical and electrical equipment, piping
and instrument lists
performing calculations as required
developing technical specifications and standards for the project
coordinating design reviews and verification
liaising with vendors and incorporating vendor data into the overall design
conducting hazards, risks and operability assessments
supporting client, supplier, contractor and construction needs with technical query
resolution and field engineering support.
•
•
•
•
•
•
•
Procurement and Contracting Plan
The PM Contractor will develop a Procurement and Contracting Plan. The plan will include
a procurement schedule and detail any interfaces between different suppliers. Procurement
will be based on engineering datasheets furnished by the PM Contractor and will be done in-
house by the AHRL and Al Tasnim procurement teams.
10
Alara Resources Annual Report 2020
[Amit: please insert headers and footers the same as the 2019 version send for comparison.]
Long-Lead Equipment
Long-Lead Equipment
The long-lead equipment items required for the project are listed in the table below.
The long-lead equipment items identified during this study are listed in the table below:
Lead time3
(months)
Equipment/Package
Mill Packages
Crusher Package
Flotation Package
Thickener Package
Filter Package
Apron Feeder & Conveyors
Pump Packages
Agitator Package
Water pipelines
Reagent Package
Air compressor Package
Electrical Package
Instrumentation Package
10
6
6
6
5
6
6
4
6
4
5
8
8
Table 5: Long-lead items
Long-lead items
expedite information, material supply and fabrication progress, and
undertake planned quality inspection and witnessing.
Inspection and Expediting
Inspection and Expediting
The PM Contractor will directly perform or engage consultants to:
The Contractor will directly perform or engage consultants to (i) expedite information, material supply and
•
fabrication progress, and (ii) undertake planned quality inspection and witnessing.
•
These activities are necessary to ensure the quantity, quality and timely delivery of information to facilitate
These activities are necessary to ensure the quantity, quality and timely delivery of information to
design and goods prior to dispatch to site.
facilitate design and construction of equipment prior to dispatch to site.
Logistics and Transport Planning
Logistics and Transport Planning
Equipment items will be sourced from India and other countries. Similarly, fabricated items, such
Equipment items will be sourced from within India and internationally. Similarly, fabricated items, such as
as steelwork and plate work, may be procured within India or fabricated in Oman.
steelwork and plate work, may be procured within India or fabricated locally.
The PM Contractor will engage a specialist logistics contractor to assist with planning the most
The Contractor will engage a specialist Logistics Contractor, to assist with the most effective use of shipping
effective means of coordinating deliveries to site. The logistics contractor will provide detailed
agents and trucking resources to site. This Contractor will provide detailed reporting of materials movement
reporting of materials movement and manage all clearances and communications directly
and manage all clearances and communications directly between shipping, haulage agents and vendors.
between shipping, haulage agents and vendors.
Construction Plan – The complete site constructions works shall be carried by the nominated site contractor/Al
Construction Plan
Tasnim group as per the final approved RFC drawings under the strict monitoring and quality checks of the
The complete site construction works will be carried by the nominated site contractor and Al
PMC contractor supervision Engineers. The scope for the construction works is:
Tasnim Group, as per the approved, final RFC drawings, under the strict monitoring and quality
• Total site management
control by the PM Contractor’s supervising engineers. The scope for the contracted construction
• Construction of Roads and Drainage
works is:
• Construction of Site Accommodation Facilities, other infrastructure facilities & Tailing dam
•
Total site management
• Construction of the Process Plant
•
Construction of roads and drainage
• Construction Manning
Construction of site accommodation facilities, other infrastructure facilities and tailings
•
• Construction Ablutions
dam
• Construction Communications & Progress reporting
•
Construction of the process plant
• Construction Waste disposal
Construction labour
•
Construction ablutions
•
Construction communications and progress reporting
•
Construction waste disposal
•
7
Time from procurement to site delivery
11
3 Procurement to site delivery.
[Pink line, which appears in certain footers, to be removed]
Alara Resources Annual Report 2020
Commissioning
The PM Contractor will commission the plant in conjunction with OEM personnel to bring the
plant and ancillary facilities into operation. A detailed commissioning plan will be presented by
the PM Contractor and HAZOP Study will be carried out on the presented plan.
A detailed ramp-up plan will be presented by the PM Contractor for the mining and process
operations.
Training
Operating Procedures
The PM Contractor will develop a Process Design Basis and Plant Control Philosophy based on the
process, equipment selected, extent of duty and standby equipment provisions, and preferences
on operating and maintenance philosophies.
It will be the PM Contractor’s responsibility to develop Standard Operating Procedures (SOPs) for
the operational phase of the project.
Process Plant Operator Training
Process plant operator training will commence prior to commissioning of the plant and will be
conducted by the PM Contractor with assistance from the OEM Engineers.
AHRL is responsible for the training of plant operators and will be assisted in this by the PM
Contractor where applicable.
The plant operators will form part of the commissioning team and will work closely with AHRL
operations personnel, the Contractor and equipment vendors.
Project Developments – Other
Mining Contractor
A preliminary commercial agreement has been reached between AHRL and Alara Resources LLC
(ARL) with the issuance of letter of intent to ARL for the mining contract, with final contract award
expected to follow.
Project Water Supply
For project water supply two options are available.
•
Pipeline route previously surveyed and approved by authorities, or
•
around the capacity of the Mudhaibi STP, which may not meet all project requirements.
from Nzawa STP (80km from Project site). This option is being evaluated for any issues
from a sewage treatment plant (STP) located in Mudhaibi (25km from the Project site).
Project Power supply
As with water, alternate power supply options are also being considered, while more accurate
estimates of power requirements are awaited from project engineering. Earlier, a consultant was
engaged to conduct a survey and finalise the route of power lines between the Project site and
Mazoon feeder stations located about 5 km away at Khadra village. The Khadra feeder can supply
power up to a certain limit. In case Project power requirements exceed the feeder capacity, the
power supply route may be changed to Sinaw.
Project Finance
AHRL agreed to proceed with project finance offers from local Omani banks:
OMR 10m (~AUD 42m) finance facility with Alizz Islamic Bank, and
•
•
OMR 10m (~AUD 42m) finance facility with Bank Nizwa,
under a “club deal” between those banks.
12
Alara Resources Annual Report 2020 Metallurgical drilling and tests
The ARL drilling team is conducting operations at the Project site to obtain metallurgical samples
for processing plant design work. Drilling has continued since March 2020 with 2688m of HQ/NQ
samples collected, with 98% core recovery.
ALS Oman and Jeddah laboratory has been engaged to conduct the core geochemical assays.
Wardell Armstrong Laboratory UK has bn engaged to conduct metallurgical tests. The test results
are expected by the end of the year.
The following figure shows the location of the metallurgical drill holes and the table following
provides the drill hole details.
Metallurgical drill holes at Wash-hi Majaza copper deposit
13
Alara Resources Annual Report 2020 [Amit: please insert headers and footers the same as the 2019 version send for comparison.]
Hole ID NO
East
North
RL
Type
Core
EOH
Azimuth
Inclination
WH20MTDD01
602138.071
2517880.078
456.343 MET
HQ
144.00
WH20MTDD02
602105.110
2517918.042
456.306 MET
HQ/NQ
159.00
WH20MTDD03
602068.292
2517885.426
456.091 MET
HQ
225.00
WH20MTDD04
602025.902
2517847.181
455.989 MET
HQ/NQ
249.00
WH20MTDD05
602043.341
2517923.759
456.282 MET
HQ/NQ
191.75
WH20MTDD06
602064.951
2517809.851
455.884 MET
WH20MTDD07
602101.556
2517842.886
456.082 MET
WH20MTDD08
602168.266
2517710.372
455.729 MET
WH20MTDD09
602201.528
2517739.164
456.980 MET
WH20MTDD10
602230.256
2517763.804
458.589 MET
WH20MTDD11
602222.174
2517668.314
456.570 MET
WH20MTDD12
602226.171
2517586.889
454.792 MET
WH20MTDD13
602318.794
2517672.811
465.209 MET
WH20MTDD14
602272.989
2517577.296
455.213 MET
WH20MTDD15
602387.123
2517597.715
457.943 MET
WH20MTDD17
602393.604
2517529.295
454.825 MET
WH20MTDD18
602304.736
2517527.227
454.535 MET
HQ
HQ
HQ
HQ
HQ
HQ
HQ
HQ
HQ
HQ
HQ
HQ
258.00
199.10
170.45
123.00
75.60
150.00
187.50
103.30
144.00
72.00
96.00
141.00
48
48
48.7
48.7
48.7
48.7
48.7
48.6
48.7
48.6
48.7
47.4
47.4
48.5
48.7
48.7
48.7
-70
-70
-69.5
-70
-69.4
-69.9
-69.6
-70.3
-69
-67.6
-69.3
-70.3
-69.6
-69.4
-70
-69.6
-69.8
Metallurgical drill-holes
Metallurgical drill-holes
Next Steps
Next Steps
The next stage of Project development involves completion of project engineering and plant and equipment
The next stage of Project development involves completion of project engineering and plant and
procurement.
equipment procurement.
Ancillary regulatory approvals are being obtained, including: Industrial license for plant operation; Ministry of
Ancillary regulatory approvals are being obtained, including: Industrial license for plant operation;
Housing approval for infrastructure located outside the mining licence; municipality clearance of detailed
Ministry of Housing approval for infrastructure located outside the mining licence; municipality
building designs and ancillary approvals for water and power supply lines.
clearance of detailed building designs and ancillary approvals for water and power supply lines.
The Omani Government Implementation Support and Follow-up Unit is working closely with AHRL and
The Omani Government Implementation Support and Follow-up Unit is working closely with
relevant Government departments to help streamline these approvals.
AHRL and relevant Government departments to help streamline these approvals.
Future Growth Opportunities
The Wash-hi exploration license has significant potential for the discovery of additional copper deposits.
Future Growth Opportunities
Most of the area around Wash-hi Majaza is covered by ancient and recent alluvial fans. Based on the
The Wash-hi exploration license has significant potential for the discovery of additional copper
premise that sulfide mineralization in the area is coincident with a distinct reduction in the magnetic
deposits. Most of the area around Wash-hi Majaza is covered by ancient and recent alluvial fans.
susceptibility values of basaltic rocks, four other targets have been identified for further follow-up, as shown
Based on the premise that sulfide mineralization in the area is coincident with a distinct reduction
in the next figure. It is proposed to follow-up these areas with electrical geophysical methods (EM or IP) to
in the magnetic susceptibility values of basaltic rocks, four other targets have been identified
confirm the target potential followed by drilling.
for further follow-up, as shown in the next figure. It is proposed to follow-up these areas with
electrical geophysical methods (EM or IP) to confirm the target potential followed by drilling.
14
Alara Resources Annual Report 2020
[Amit: please insert headers and footers the same as the 2019 version send for comparison.]
Hole ID NO
East
North
RL
Type
Core
EOH
Azimuth
Inclination
WH20MTDD01
602138.071
2517880.078
456.343 MET
HQ
144.00
WH20MTDD02
602105.110
2517918.042
456.306 MET
HQ/NQ
159.00
WH20MTDD03
602068.292
2517885.426
456.091 MET
HQ
225.00
WH20MTDD04
602025.902
2517847.181
455.989 MET
HQ/NQ
249.00
WH20MTDD05
602043.341
2517923.759
456.282 MET
HQ/NQ
191.75
WH20MTDD06
602064.951
2517809.851
455.884 MET
WH20MTDD07
602101.556
2517842.886
456.082 MET
WH20MTDD08
602168.266
2517710.372
455.729 MET
WH20MTDD09
602201.528
2517739.164
456.980 MET
WH20MTDD10
602230.256
2517763.804
458.589 MET
WH20MTDD11
602222.174
2517668.314
456.570 MET
WH20MTDD12
602226.171
2517586.889
454.792 MET
WH20MTDD13
602318.794
2517672.811
465.209 MET
WH20MTDD14
602272.989
2517577.296
455.213 MET
WH20MTDD15
602387.123
2517597.715
457.943 MET
WH20MTDD17
602393.604
2517529.295
454.825 MET
WH20MTDD18
602304.736
2517527.227
454.535 MET
HQ
HQ
HQ
HQ
HQ
HQ
HQ
HQ
HQ
HQ
HQ
HQ
258.00
199.10
170.45
123.00
75.60
150.00
187.50
103.30
144.00
72.00
96.00
141.00
48
48
48.7
48.7
48.7
48.7
48.7
48.6
48.7
48.6
48.7
47.4
47.4
48.5
48.7
48.7
48.7
-70
-70
-69.5
-70
-69.4
-69.9
-69.6
-70.3
-69
-67.6
-69.3
-70.3
-69.6
-69.4
-70
-69.6
-69.8
Metallurgical drill-holes
Next Steps
procurement.
The next stage of Project development involves completion of project engineering and plant and equipment
Ancillary regulatory approvals are being obtained, including: Industrial license for plant operation; Ministry of
Housing approval for infrastructure located outside the mining licence; municipality clearance of detailed
building designs and ancillary approvals for water and power supply lines.
The Omani Government Implementation Support and Follow-up Unit is working closely with AHRL and
relevant Government departments to help streamline these approvals.
Future Growth Opportunities
The Wash-hi exploration license has significant potential for the discovery of additional copper deposits.
Most of the area around Wash-hi Majaza is covered by ancient and recent alluvial fans. Based on the
premise that sulfide mineralization in the area is coincident with a distinct reduction in the magnetic
susceptibility values of basaltic rocks, four other targets have been identified for further follow-up, as shown
in the next figure. It is proposed to follow-up these areas with electrical geophysical methods (EM or IP) to
confirm the target potential followed by drilling.
Potential RTP magnetic regional exploration targets in Wash-hi licenses
Mullaq Exploration License
The Mullaq Exploration License area is adjacent to Wash-hi Exploration License. The Mullaq
prospect lies within the Oman Mountains, approximately 160 kilometres south-east of Muscat via
sealed road. It can be reached either from the Muscat-Nizwa highway, 40km to the northwest, or
from the Muscat-Ibra highway, 45km north along the Wadi Andam valley. Mullaq is located 5.5km
east of the Wadi Andam.
Mullaq EL and ML application locations
15
Alara Resources Annual Report 2020
[Amit: please insert headers and footers the same as the 2019 version send for comparison.]
Previous explorers in the Mullaq License area discovered copper mineralization in layered gabbro
sequence, yet a large part of the tenement still remains unexplored. So far, no resource modelling has been
conducted at Mullaq, however geophysical surveys and drilling campaigns by Alara have identified the
presence of potential mineral deposits in the area.
In addition to the above, ancient copper slag sample from Mullaq was tested at the Australian Minerals
Research Centre in Perth. The tests showed potential for economic extraction by long term heap leaching
methods. Further evaluation is required to determine the most economic options for copper recovery.
Future growth opportunities
The ground magnetics survey conducted at Mullaq demarcated anomalies consistent with the known VMS
Previous explorers in the Mullaq License area discovered copper mineralization in layered gabbro
signatures in this geological environment. A total of nine targets were identified for further follow-up, with
sequence, yet a large part of the tenement still remains unexplored. So far, no resource modelling
the majority being manifested by RTP magnetic lows, similar to the Wash-hi magnetic signature. All
identified exploration targets based on ground magnetics in Mullaq (except MQ001) remain untested. Also,
has been conducted at Mullaq, however geophysical surveys and drilling campaigns by Alara
the existing mineralization remains open for further potential extensions.
have identified the presence of potential mineral deposits in the area.
RTP magnetics regional exploration targets in Mullaq license areas
RTP magnetics regional exploration targets in Mullaq license areas
Exploration Targets – Mineralisation
Exploration Targets – Mineralisation
Exploration Targets at Mullaq are estimated purely based on the size, geological perception and
Exploration Targets at Mullaq are estimated purely based on the size, geological perception and structural
structural interpretation of the geophysical target, and without any other obvious geochemical or
interpretation of the geophysical target, and without any other obvious geochemical or lithological or geo-
lithological or geo-statistical support. Anticipated copper and gold mineralization targets in the
statistical support. Anticipated copper and gold mineralization targets in the Mullaq license area, can be
Mullaq license area, can be categorized as stated in the following table.
categorized as stated in the following table.
License area
Target No
Target Type
Mullaq 41km2
MQT-1
Extensions of non JORC
resources at Daris 3A5
Estimated
Tonnage (Range)
Grade Cu%
Au (g/t)
0.25 – 1 MT
1 – 3%
0.09 – 1.2
MQT-2
Untested geophysical targets
3 – 4 MT
0.9 – 2%
0.09 – 0.3
Mullaq exploration targets (grades are approximations
Mullaq exploration targets (grades are approximations)
(Note: The potential quantity and grade of the above exploration targets are conceptual in nature. There
(Note: The potential quantity and grade of the above exploration targets are conceptual in
has been insufficient exploration to determine a mineral resource and there is no certainty that further
nature. There has been insufficient exploration to determine a mineral resource and there is no
exploration work will result in the determination of mineral resources or that the production target itself will
certainty that further exploration work will result in the determination of mineral resources or that
be realised.)
the production target itself will be realised.)
16
Alara Resources Annual Report 2020
[Amit: please insert headers and footers the same as the 2019 version send for comparison.]
Previous explorers in the Mullaq License area discovered copper mineralization in layered gabbro
sequence, yet a large part of the tenement still remains unexplored. So far, no resource modelling has been
conducted at Mullaq, however geophysical surveys and drilling campaigns by Alara have identified the
presence of potential mineral deposits in the area.
In addition to the above, ancient copper slag sample from Mullaq was tested at the Australian Minerals
Research Centre in Perth. The tests showed potential for economic extraction by long term heap leaching
methods. Further evaluation is required to determine the most economic options for copper recovery.
Future growth opportunities
The ground magnetics survey conducted at Mullaq demarcated anomalies consistent with the known VMS
signatures in this geological environment. A total of nine targets were identified for further follow-up, with
the majority being manifested by RTP magnetic lows, similar to the Wash-hi magnetic signature. All
identified exploration targets based on ground magnetics in Mullaq (except MQ001) remain untested. Also,
the existing mineralization remains open for further potential extensions.
RTP magnetics regional exploration targets in Mullaq license areas
Exploration Targets – Mineralisation
Exploration Targets at Mullaq are estimated purely based on the size, geological perception and structural
interpretation of the geophysical target, and without any other obvious geochemical or lithological or geo-
statistical support. Anticipated copper and gold mineralization targets in the Mullaq license area, can be
categorized as stated in the following table.
License area
Target No
Target Type
Estimated
Grade Cu%
Au (g/t)
Mullaq 41km2
MQT-1
Extensions of non JORC
resources at Daris 3A5
Tonnage (Range)
0.25 – 1 MT
1 – 3%
0.09 – 1.2
MQT-2
Untested geophysical targets
3 – 4 MT
0.9 – 2%
0.09 – 0.3
Mullaq exploration targets (grades are approximations
(Note: The potential quantity and grade of the above exploration targets are conceptual in nature. There
has been insufficient exploration to determine a mineral resource and there is no certainty that further
exploration work will result in the determination of mineral resources or that the production target itself will
be realised.)
Next Steps - Mining License Application in Progress
With the grant of a mining license and the development of a copper concentrator plant at the
nearby Wash-hi Majaza, any high-grade deposit delineated at Mullaq could be developed on
hub and spoke basis.
A mining license application at Mullaq submitted in 2013 has progressed through various
Ministries in Oman. An Environmental Impact Assessment was also completed. AHRL considers
a Mining Licence clearance to be key to further exploration work in the area. The timeframe for
the grant of the Mining licence and conduct of the exploration program designed to test the
exploration target is estimated to be three years.
Al Ajal Exploration License
The Al Ajal Prospect is located near the village of Al Ajal in Taww area, about 20km south of Barka,
which lies on the northern coast of the Sultanate of Oman and about 65km west of Muscat, as
shown in the following figure.
Location of Al Ajal Mining License application area
17
Alara Resources Annual Report 2020
Alara carried out ground geophysical surveys over limited areas to confirm the geophysical
signatures of mineralisation from historical (non-JORC compliant) mineral estimates in the Al Ajal
License Area. See the figure below
Prospective areas within Al Ajal Exploration License
The “call-out” shows the EP slice at 100m depth
18
Alara Resources Annual Report 2020 Exploration Potential – Future Opportunities
Preliminary exploration confirmed the presence of two more areas of potential positivity in
similar geological trends. The Al Ajal prospect is unique, as it is considered to be the only known
mineral occurrence in Oman Mountains that is considered not to be associated with the ophiolite
volcanics of Oman. Despite its small size and difficult terrain, in view of the high gold grades
detected by previous explorers, this prospect warrants further exploration for copper and gold-
bearing deposits.
Mining License Application
A mining license application at Al Ajal submitted in 2013 has progressed through various Ministries
in Oman. AHRL considers the grant of a mining licence clearance as a key prerequisite to further
exploration work in the area.
Daris Resources LLC Copper-Gold Project
Daris Resources LLC is currently a 50-50 joint venture between Alara and Al Tamman Trading
Establishment LLC.
The Daris Project comprises of one exploration licence (Block 7) of ~587km2 located approximately
150km West of the Omani capital Muscat.
By conducting extensive exploration programs in Block 7, the Daris JV has defined resources at
Daris East Prospect to measured category under JORC, identified mineralisation at the Daris 3A5
prospect and several exploration targets.
Two Mining Licence applications filed over Daris East and Daris 3A-5 prospects within the
exploration licence remain pending. The following figure and table provide details of licenses
at Daris. Recent site visits conducted by Ministry officials gave positive indications for these
applications advancing towards issuance.
Block 7 Exploration License and Mining License application areas
19
Alara Resources Annual Report 2020 [Amit: please insert headers and footers the same as the 2019 version send for comparison.]
Daris Resources LLC Copper-Gold Project
Daris Resources LLC is currently a 50-50 joint venture between Alara and Al Tamman Trading
Establishment LLC.
West of the Omani capital Muscat.
The Daris Project comprises of one exploration licence (Block 7) of ~587km2 located approximately 150km
By conducting extensive exploration programs in Block 7, the Daris JV has defined resources at Daris East
Prospect to measured category under JORC, identified mineralisation at the Daris 3A5 prospect and
several exploration targets.
Two Mining Licence applications filed over Daris East and Daris 3A-5 prospects within the exploration
licence remain pending. The following figure and table provide details of licenses at Daris. Recent site visits
conducted by Ministry officials gave positive indications for these applications advancing towards issuance.
Block 7 Exploration License and Mining License application areas
Block/License
Exploration Licenses
Mining License within ELs
Name
License
owner
Alara
share
Area
Date of
Grant
Expiry
50%
2
587km
Nov 2009 Nov 2012
Block 7 Al Tamman
Trading and
Est. LLC,
Oman
Renewal
applied
for
Status
Area
Date of
Application
Status
May 2018 Deemed
granted
Daris
East
3.2km2
Dec 2012
In
process
Daris 3A5
1.3km2
Dec 2012
In
process
Daris License details
Daris East Prospect
The current copper Resource for the Daris-East Prospect is outlined below:
Ore type Cut-off
grade Cu%
Measured
Indicated
Inferred
Tonnes
Cu%
Tonnes
Cu%
Tonnes
Cu%
Sulphides
0.50
130,000
Oxides
96,000
Daris East prospect copper resource
0.50
2.50
0.89
110,000
86,000
2.20
0.7
30,000
2,000
2.00
1.00
In addition, historic drilling data from 44 holes totalling 4,353m has been included in the
•
A total of 21 rotary (624m) and 41 diamond core (4,654m) holes totalling 5,278m have
been drilled by Alara to test shallow oxide mineralisation and to locate massive sulphide and
stringer zones beneath the oxide cap at the Daris-East prospect and to test geophysical targets
in the vicinity.
•
resource database.
Preliminary drilling at Daris 3A5 has intersected high-grade copper mineralisation. Alara plans to
conduct further drilling before making an updated resource estimation.
On 20 September 2012, Alara announced drilling results for Daris 3A-5. The drill hole location
map and intersection table are set out below.
Daris 3A5 Drill-hole locations
20
Alara Resources Annual Report 2020
[Amit: please insert headers and footers the same as the 2019 version send for comparison.]
Daris Resources LLC Copper-Gold Project
Daris Resources LLC is currently a 50-50 joint venture between Alara and Al Tamman Trading
Establishment LLC.
West of the Omani capital Muscat.
The Daris Project comprises of one exploration licence (Block 7) of ~587km2 located approximately 150km
By conducting extensive exploration programs in Block 7, the Daris JV has defined resources at Daris East
Prospect to measured category under JORC, identified mineralisation at the Daris 3A5 prospect and
several exploration targets.
Two Mining Licence applications filed over Daris East and Daris 3A-5 prospects within the exploration
licence remain pending. The following figure and table provide details of licenses at Daris. Recent site visits
conducted by Ministry officials gave positive indications for these applications advancing towards issuance.
Block 7 Exploration License and Mining License application areas
Block/License
Exploration Licenses
Mining License within ELs
Name
License
owner
Alara
share
Area
Date of
Grant
Expiry
Status
Area
Date of
Status
Application
Renewal
applied
for
Block 7 Al Tamman
50%
587km
Nov 2009 Nov 2012
May 2018 Deemed
Dec 2012
In
2
granted
Daris
East
3.2km2
1.3km2
Daris 3A5
Dec 2012
In
process
process
Trading and
Est. LLC,
Oman
Daris License details
Daris East Prospect
The current copper Resource for the Daris-East Prospect is outlined below:
Ore type Cut-off
grade Cu%
Measured
Indicated
Inferred
Tonnes
Cu%
Tonnes
Cu%
Tonnes
Cu%
Sulphides
Oxides
0.50
0.50
130,000
96,000
2.50
0.89
110,000
86,000
2.20
0.7
30,000
2,000
2.00
1.00
Daris East prospect copper resource
Significant intersections from core drilling – Daris 3A5 prospect
Notes:
•
•
The cut-off grade is 0.2% Cu in respect of intersections within the copper-rich zone.
The drill intercepts are reported as drilled. True thickness will be calculated at the
interpretation and resource modelling stage.
Next Steps
The grant of the Mining License at Wash-hi Majaza has provided the Company with a basis to
further develop its copper exploration programs at Daris. Optional analysis study and an advanced
scoping study conducted in 2014 identified multiple options for Daris East resources to underpin
further work in Block 7. The Daris JV has collaborated with Mineral Development of Oman in
developing further exploration programs for Blocks 7 and 8.
Awtad Resources LLC - Copper Project
The Awtad Project is located immediately adjacent to the Licence Area No. 7 (Block 7) comprising
the Daris Copper-Gold Project and comprises a mineral exploration licence (Block 8) of ~497km.
The Company has signed a binding Heads of Agreement granting Alara an initial 10% interest in
the Project and a right to increase to a 70% shareholding in Awtad Copper LLC
Block 8 Exploration License location
Alara has previously undertaken some exploration activity on Block 8. Rock chip samples returned
multi-elemental enrichment of up to 2.68% Copper, 2.4ppm Silver, and 0.1% Zinc, indicating a
potential base metal deposit below.
21
Alara Resources Annual Report 2020
Alara Resources LLC
Alara Resources LLC (ARL) is a Joint Venture between Alara Oman Operations Pty Ltd (35%), a
wholly owned subsidiary of Alara Resources Limited, South West Pinnacle Exploration Ltd (SWPE)
an established Indian exploration and mining Company listed on the National Stock Exchange
India (35%) and Al Tasnim Infrastructure LLC (30%), a privately owned Omani company from the
Al Turki group, one of the largest construction companies in Oman.
Exploration and Mining Services
With a new mining law in Oman and the plans of PAM to award 110 new, multi-commodity
exploration and mining licenses in Oman, and encouraged by the potential for increased future
demand for exploration services in Oman, ARL has positioned itself to provide drilling services to
Oman’s mining industry. To exploit these opportunities ARL purchased two KORES-1200 drill rigs
and associated accessories.
ARL drilling team
ARL was issued a letter of intent for a ten-year mining contract at AHRL’s Wash-hi Majaza project.
Copper Exploration
ARL has previously submitted ten exploration license applications for copper exploration licenses,
which remain pending.
Lithium Exploration
A large interior drainage area in Oman is known for the deposition of evaporates. ARL plans to
explore potential concentrations of alkali salts and alkaline earths (including lithium) within this
interior basin.An ARL Exploration License application covering a 10km2 area is currently pending.
Saudi Arabia
Khnaiguiyah Zinc-Copper Project
The Khnaiguiyah Zinc-Copper Project is located approximately 170km south-west of the Saudi
Arabian capital city of Riyadh. The mining licence (held by a former JV partner) was cancelled in
December 2015. Alara, as sole funder of the Definitive Feasibility Study, is poised to restart the
project once the licence is re-issued and is working with relevant parties in both the private and
public sectors to prepare for this. The Minister of Industry and Mineral Resources bandar Bin
Ibrahim Al-Khorayef previously announced the allocation of 54 mining reserve sites, including
five zinc sites with one in Al Khnaiguiyah
22
Alara Resources Annual Report 2020 Board of Directors
Stephen Gethin, Non – Executive Director and Chairman, Barrister and
Solicitor of the High Court of Australia
Stephen Gethin is a highly regarded professional with 30 years’ experience
in the provision of corporate legal advice and over 15 years’ experience
in the provision of ASX-listed secretarial services in a range of industries,
including resources, technology and investment.
Prior to founding a private legal practice in 2013, he served as General
Counsel and Company Secretary of Strike Resources Limited (ASX:SRK)
and before that held the same roles at ERG Limited (ASX:ERG).
Mr Gethin also provides legal advice to a number of other ASX-listed and
private companies.
Atmavireshwar Sthapak – Managing Director, B.Sc, MTech
Atmavireshwar Sthapak is a geologist specializing in mineral resource
exploration and evaluation studies. He joined the Company in 2011 as an
Exploration Manager and led geological investigations in Oman spanning
over 1000 sq.km in five JV tenements in the country. His contribution
resulted in identification of copper mineralization in four tenements,
definitions of JORC resources at Wash-hi and Daris East and applications
for mining licenses over five areas.
After being appointed Executive Director in 2015, Mr Sthapak contributed
in completion of a feasibility study, a maiden ore reserve statement and a
mining license for the Al Hadeetha Copper Gold project in Oman. Later
he contributed to the formulation of AHRL’s mining project development
strategy and further exploration plans in Oman.
In July 2020, Mr. Sthapak was appointed as Managing Director with the
responsibility of directing the Company to become a major miner and
producer of copper concentrate in Oman, and to expand its shareholder’s
value to new levels.
Prior to joining the Company, Mr. Sthapak’s career spanned 10 years with
ACC/ACC-CRA Ltd as exploration geologist and project manager and 10
years with Rio Tinto (Australasia) Exploration and Rio Tinto Diamond, where
he was awarded a Rio Tinto Discovery Award in 2009. He has worked on
world-class deposits and mines in Australia, gold and diamond mines on
four continents. Mr. Sthapak is an active member of Aus IMM.
Vikas Jain – Non-Executive Director, MBA
Vikas Jain holds an MBA obtained in the USA and has 19 years’ experience
in the field of mineral exploration, mining, oil-field exploration and allied
activities. He is currently Managing Director and CEO of the Indian company
23
Alara Resources Annual Report 2020
South West Pinnacle Exploration Limited (SWPE) founded by him in 2006
and listed on the National Stock Exchange, India. Under his leadership and
able guidance, SWPE has continued to grow and at present is a premier
exploration company in India.
SWPE began primarily as a mineral exploration company and progressively
added coal-bed methane exploration and production, aquifer mapping,
HDD, geophysical logging, transportation and other geological activities
into its domain. This year SWPE has also ventured into 3D seismic acquisition
and processing for oil field exploration services.
Mr Jain also has wide experience in the open-cut mining of various minerals
and allied activities through his earlier roles with other companies, as well
as his current involvement in other family run businesses and interests.
Sanjeev Kumar – Non-Executive Director, MBA (Finance & Marketing), IMT
Ghaziabad, India; BE (Metallurgy), VNIT Nagpur, India
Mr Kumar has extensive Australian and international business experience,
with a specialisation in high-value asset finance lending. He holds an .
He is currently a director of Tradexcel Global Pty Ltd, an Australian company
which he co-founded in 2017. His company helps ANZ businesses in
expanding into the overseas markets, assessing new markets, navigating
entry barriers, providing regulatory clearance services, business strategy &
planning, local partnerships etc. His previous roles include Vice President
at India Factoring & Finance Solutions (a subsidiary of Fimbank), Associate
Vice President at Tata Capital Financial Services, India and Manager,
Infrastructure Division at ICICI Bank Limited.
Avi Sthapak – Non-Executive Director
Avi is a graduate with a degree in Computer Science Engineering with a
focus on infrastructure management. He is currently enrolled in a Master of
Business Administration at Curtin University in Western Australia, where his
studies include strategy development, accounting, global mobility, talent
acquisition, marketing, leadership and finance. He has experiences as a
Business Development Consultant and a Management Consultant.
Perth Management Support Team
Dinesh Aggarwal – Chief Financial Officer and Company Secretary, FCPA,
CA, CMA, FTI, DipFS (Advanced)
Mr Aggarwal has over 20 years’ experience in accounting, finance and
business management in top corporate positions, both in Australia and
overseas, and is the Founder and Managing Director of Fortuna Advisory
Group.
Fortuna is an award-winning, multi-disciplinary practice with specialised
divisions in Tax & Business Advisory, Legal Services, Mortgage Broking and
Financial Planning.
24
Alara Resources Annual Report 2020
Mr Aggarwal advises clients in Australia and overseas on tax matters and
business services, and advises the Australian operations of several multi-
nationals. He also handles tax disputes with the ATO including appeals to
the AAT. He is the former Chairman of the Public Practice Committee of
CPA Western Australia and is currently a member of the National Public
Practice Advisory Committee of CPA Australia.
Named as one of Australia’s top three SME Tax Advisers in 2015 by the Tax
Institute, Mr Aggarwal has also won the prestigious CPA Australia 40 Under
40 Young Business Leaders Award for 2012 and 2013.
In 2016, he was awarded the ISWA Personal Excellence Award. In 2018
Fortuna was a national finalist in the Australian Accounting Awards for Best
Business Advisory Firm. The Fortuna Group also has a philanthropic arm -
Fortuna Foundation.
Tina Newborn – Office Manager, Adv. Dip. Accounting, Adv. Dip. Business
Administration
Mrs. Newbon joined the Company in 2011 as an Executive Assistant to the
CEO and has since been involved in many aspects of the business including
office administration, human resources, corporate affairs, finance, leasing/
relocation, ASX requirements and IT management.
Mrs. Newbon is a highly experienced administrator with over 15 years of
administration, finance and project experience including BGC Blokpave,
Shell Australia, WA Gas Networks and BHP Billiton.
Oman JV Management Team
Avigyan Bera – CEO (AHRL), BTech, PEngg (SAIMECHE)
Mr. Bera has over 13 years of experience in handling EPC Projects in India
and overseas. His experience and professionalism has seen him work in
various countries including India, Zambia, South Africa, Liberia, Namibia,
Mongolia, Iran, UAE, Bulgaria and Morocco to oversee major EPC Projects.
He started his career in process engineering for mineral beneficiation
plants and complex chemical process plants, then migrated to project
management & business development activities in India, Africa and the
Middle East regions.
Mr. Bera joined AHRL in June, 2020. He brings a wealth of experience and
technical knowhow resulting in the efficient execution of owner-managed
projects through his vendor contacts and key knowledge in process
engineering, project execution and overall management.
Venkatesan Ganesan – Corporate Financial Adviser, MBA, CPA, ACA, ACS,
CBV
Mr. Ganesan joined Alara in September 2017, in Dubai.
Mr Ganesan runs a boutique advisory services firm in Dubai and India.
25
Alara Resources Annual Report 2020
He has spent over 15 years in a Big-4 financial advisory practice and has
advised a variety of industry clients on transaction matters. He also spent
six years in an upstream E & P business at the start of his career. Mr Ganesan
is currently assisting Alara in optimising development stage capital.
Fadi Zenaty – Operations Manager, B.Sc. IMS and Business Administration
Mr. Zenaty has over 15 years’ professional experience in Saudi Arabia in
mining and construction projects in the Middle East.
He brings a vast knowledge of corporate operations and economic
evaluation in building projects from inception.
Fadi was a key person in obtaining the exploration and mining licenses
for Alara’s Al Khnaiguiyah zinc and copper project and other key mining
projects. He has a wide and solid knowledge of the governmental
processes in the Middle East. He brings a strong track record of navigating
the governmental rules and technical mining information requirements to
ensure project success.
He has significant experience in day-to-day corporate operations related to
management, finance and engineering requirements for the projects that
he leads. His background also includes specialized rolls in organization
systems analysis and IT development in improving the overall operations
of the corporations which he is engaged in improving.
Rexin Kamilas – Finance and Administrative Manager, BACS, M.Com, Tally
Mr. Kamilas is a business administration officer with over 14 years’
administration and accounts experience in Oman and India. He joined
Alara in 2011 as an administrative and accounting assistant. He has been
involved in various business operations related to administration, banking,
insurance, finance, procurements and logistics.
Mr. Kamilas has utilized his experiences and skills in improving the
administrative and finance system in the organization and providing his full
support to the team to build a robust management system resulting in a
solid foundation for future corporate developments.
Mr. Kamilas has a key role in supporting the preparation of the consolidated
financial reports of Alara.
Nehal Hasan Warsi – Geologist, BSc (Geology Honours); MSc (Applied
Geology); PGD (Hydrogeology) & Certificate (Disaster. Mngmt)
Mr. Warsi is a geologist with over 15 years’ experience. He has been
involved in mineral exploration and mining, water well drilling and other
scientific research projects in India, the Middle East and Africa. Having
worked both locally and internationally, his expertise in mineral exploration
and resource projects for various metals, rocks and industrial minerals is
invaluable to the Company.
Mr. Warsi was the senior project geologist and site in charge of the resource
26
Alara Resources Annual Report 2020
drilling program for the company’s Khnaiguiyah zinc and copper project in
Saudi Arabia that led to the successful completion of a DFS. He has also
worked as a geologist on the Al Ajal and Al Wash-hi deposits in Oman with
Pilatus Resources.
Lakshman R. Muthyam – Company Secretary (AHRL), B.Sc IT, A.U
Mr. Muthyam is an experienced administration and information technology
professional with over 7 years’ experience in India and Oman.
Mr. Muthyam joined AHRL in April 2019 and oversees AHRL corporate
governance. He also has a key role in developing and improving corporate
information management systems and infrastructure. He brings a wide
range of administrative support experience related to office management
and IT support. Along with his bachelor’s degree in science, he also has a
certificate in contract law and justice from Harvard University.
27
Alara Resources Annual Report 2020
[Amit: please insert headers and footers the same as the 2019 version sent for comparison.]
Mineral Licences
Mineral Licences
Oman
Oman
Al Hadeetha and Daris Copper-Gold Projects
Al Hadeetha and Daris Copper-Gold Projects
Alara has joint venture interests in five copper-gold deposits located within four Exploration
Alara has joint venture interests in five copper-gold deposits located within four Exploration Licences in
Licences in Oman, extending over 692km2. These deposits are also covered by five Mining
Oman, extending over 692km2. These deposits are also covered by five Mining Licence applications
Licence applications pending grant, totalling approximately 9km2.
pending grant, totalling approximately 9km2.
The Wash-hi/Mullaq prospects are located approximately 160km South-Southwest of Muscat, the
The Wash-hi/Mullaq8 prospects are located approximately 160km South-Southwest of Muscat, the
capital of Oman. The Al Ajal Prospect is located about 65 km Southwest of the Capital. The Daris
capital of Oman. The Al Ajal Prospect is located about 65 km Southwest of the Capital. The Daris
Copper-Gold Project is located approximately 150km West of Muscat. These projects/prospects
Copper-Gold Project9 is located approximately 150km West of Muscat. These projects/prospects are
all located on, or very close to, high-quality bitumen roads.
are all located on, or very close to, high-quality bitumen roads.
The current status of all licences/applications for this project is presented in the table below.
The current status of all licences/applications for this project is presented in the table below.
Licence Name
Licence
Owner
Alara JV
Interest
Exploration Licence
Area
Wash-hi Majaza
AHRL
51%
39km2
Grant
Date
Jan
2008
Expiry
Date
Nov
2016
Mining Licence within EL
Status Area
Active
2.1km2
Application
Date
Dec 2012
Status
Pending
Mullaq
Al Ajal
AHRL
70%
41km2 Oct
2009
AHRL
70%
25km2
Jan
2008
Nov
2016
Nov
2016
Active
1km2
Jan 2013
Pending
Active
1.5km2
Jan 2013
Pending
Mineral project licence details
Cu % Cut off
Indicated Resource
Inferred Resource
Tonnes
(M)
Copper
(Cu) %
Gold (Au)
g/t
Tonnes(
M)
Copper
(Cu) %
Gold
(Au) g/t
0.20
0.25
0.30
0.40
12.40
12.40
12.40
12.20
0.50
11.40
Copper Resources
0.89
0.89
0.89
0.90
0.93
0.22
0.22
0.22
0.22
0.23
3.70
3.70
3.70
3.50
3.00
0.78
0.79
0.79
0.81
0.88
0.23
0.23
0.23
0.24
0.25
8 Refer Alara’s 8 December 2011 ASX Announcement: Project Acquisition – Al Ajal Wash-hi Mullaq Copper-
Gold Project in Oman.
9 Refer Alara’s 30 August 2010 ASX Announcement; Project Acquisition – Daris Copper Project in Oman
8 Refer Alara’s 8 December 2011 ASX Announcement: Project Acquisition – Al Ajal Wash-hi Mullaq Copper-Gold Project in Oman.
9 Refer Alara’s 30 August 2010 ASX Announcement; Project Acquisition – Daris Copper Project in Oman.
28
Alara Resources Annual Report 2020
[Amit: please insert headers and footers the same as the 2019 version sent for comparison.]
[Amit: please insert headers and footers the same as the 2019 version sent for comparison.]
[Amit: please insert headers and footers the same as the 2019 version sent for comparison.]
Cut off
Cut off
Au (g/t)
Au (g/t)
Cut off
Au (g/t)
Inferred Resource
Inferred Resource
Inferred Resource
Ounces
Gold
Ounces
Gold
Gold
Ounces
k/Oz
(Au) g/t
k/Oz
(Au) g/t
k/Oz
(Au) g/t
Kt
Kt
Kt
220
260
270
310
350
410
420
440
0.40
0.35
0.25
0.20
0.15
0.10
0.05
5.02
0.60
4.34
0.50
4.98
0.50
5.63
0.50
5.27
0.40
5.40
0.40
5.66
0.40
0.30
5.66
5.66
5.40
5.40
5.27
5.27
5.63
5.63
4.98
4.98
4.34
4.34
5.02
5.02
4.24
4.24
3.86
3.86
2.89
2.89
0.40
0.40
0.40
0.40
0.40
0.40
0.50
0.50
0.50
0.50
0.50
0.50
0.60
0.60
0.60
0.60
0.60
0.60
0.60
0.60
0.05
0.05
0.10
0.10
0.15
0.15
0.20
0.20
0.25
0.25
0.30
0.30
0.35
0.35
0.40
0.40
0.45
0.45
0.50
0.50
440
440
420
420
410
410
350
350
310
310
270
270
260
260
220
220
200
200
150
2.89
150
Gossan hill mineralisation – Gold10
Gossan hill mineralisation – Gold10
Gossan hill mineralisation – Gold
Notes
Notes
Notes
Notes
1 Mineral Resources are not Mineral Reserves. There is no certainty that all or any part of the Mineral
1 Mineral Resources are not Mineral Reserves. There is no certainty that all or any part of the Mineral
1 Mineral Resources are not Mineral Reserves. There is no certainty that all or any part of the Mineral
1
Mineral Resources estimated will be converted into Mineral Reserves.
2 Mineral Resources reported in accordance with the JORC 2012.
2 Mineral Resources reported in accordance with the JORC 2012.
3
Mineral Resources reported in accordance with the JORC 2012.
2
3
The Cu-Au Resource is stated as having a 0.25% Cu cut-off grade. The gold resource in the
3
4
4
Gossan hill (outside the main ore body) has a 0.25 g/t Au cut-off grade.
The Cu-Au Resource is stated as having a 0.25% Cu cut-off grade. The gold resource in the Gossan hill
The Cu-Au Resource is stated as having a 0.25% Cu cut-off grade. The gold resource in the Gossan hill
(outside the main ore body) has a 0.25 g/t Au cut-off grade.
(outside the main ore body) has a 0.25 g/t Au cut-off grade.
1 ounce of Au = 31.1035 grams.
1 ounce of Au = 31.1035 grams.
The Cu-Au Resource is stated as having a 0.25% Cu cut-off grade. The gold resource in the Gossan hill
(outside the main ore body) has a 0.25 g/t Au cut-off grade.
1 ounce of Au = 31.1035 grams.
2 Mineral Resources reported in accordance with the JORC 2012.
3
Mineral Resources are not Mineral Reserves. There is no certainty that all or any part of the
150
Gossan hill mineralisation – Gold10
Resources estimated will be converted into Mineral Reserves.
Resources estimated will be converted into Mineral Reserves.
Resources estimated will be converted into Mineral Reserves.
0.60
0.60
4.24
0.60
3.86
0.45
0.50
200
4
Indicated
Inferred
Grand total
0.89
3.71
12.4
Copper
(Cu)
%
Gold
(Au)
g/t
0.22
Resource
classification
Resource
Resource
classification
classification
Gold
Gold
(Au)
(Au)
g/t
g/t
0.22
0.22
0.23
0.23
0.22
0.22
Tonne
Tonne
Tonne
s
s
s
Mt
Mt
Mt
12.4
12.4
3.71
3.71
16.1
16.1
Copper
Copper
(Cu)
(Cu)
%
%
Indicated
0.89
Indicated
0.89
Inferred
0.79
Inferred
0.79
Grand total
0.87
0.87
Grand total
0.87
Wash-hi copper-gold resources summary @ 0.25% Cu cut-off11
Wash-hi copper-gold resources summary @ 0.25% Cu cut-off11
Wash-hi copper-gold resources summary @ 0.25% Cu cut-off11
Wash-hi copper-gold resources summary @ 0.25% Cu cut-off
Indicated Resources were converted to a Probable Ore Reserve after the application of modifying
Indicated Resources were converted to a Probable Ore Reserve after the application of modifying
Indicated Resources were converted to a Probable Ore Reserve after the application of modifying
Indicated Resources were converted to a Probable Ore Reserve after the application of modifying
factors, including pit optimization, mine design and an economic evaluation12
factors, including pit optimization, mine design and an economic evaluation12
factors, including pit optimization, mine design and an economic evaluation12
factors, including pit optimization, mine design and an economic evaluation
The Ore Reserve estimate (based on a 0.3% Cu cut-off), and in pit mineral inventory are shown in
The Ore Reserve estimate (based on a 0.3% Cu cut-off), and in pit mineral inventory are shown in
The Ore Reserve estimate (based on a 0.3% Cu cut-off), and in pit mineral inventory are shown in
The Ore Reserve estimate (based on a 0.3% Cu cut-off), and in pit mineral inventory are shown in
the Tables below.
the Tables below.
the Tables below.
the Tables below.
0.79
0.23
16.1
0.22
Classification
Classification
Classification
Tonnes Mt
Tonnes Mt
Tonnes Mt
Probable
Probable
Probable
Wash-hi ore reserve
Wash-hi ore reserve
Wash-hi ore reserve
9.7
9.7
9.7
Ore reserve
Ore reserve
Ore reserve
Copper (Cu)
Copper (Cu)
%
%
Copper (Cu)
%
Gold (Au) g/t
Gold (Au) g/t
Gold (Au) g/t
0.88
0.88
0.88
0.22
0.22
0.22
Classification
Classification
Classification
Tonnes Mt
Tonnes Mt
Tonnes Mt
Copper (Cu)
Copper (Cu)
%
%
Copper (Cu)
%
Gold (Au)
Gold (Au)
Gold (Au)
g/t
g/t
g/t
Ore reserve
Inferred resource
9.7
Ore reserve
Ore reserve
Inferred resource
Inferred resource
Total
10.00
Total
Wash-hi mining inventory
Wash-hi mining inventory
9.7
9.7
0.3
0.3
0.3
10.00
10.00
Total
Wash-hi mining inventory
10 Refer Alara’s 19 September 2016 ASX Announcement.
0.87
0.88
0.88
0.65
0.65
0.87
0.87
0.88
0.65
0.22
0.22
0.22
0.22
0.22
0.22
0.22
0.22
0.22
11 Refer Alara’s 15 December 2016 ASX Announcement: Maiden JORC Ore Reserves – Al Hadeetha Copper-Gold
10 Refer Alara’s 19 September 2016 ASX Announcement.
10 Refer Alara’s 19 September 2016 ASX Announcement.
10 Refer Alara’s 19 September 2016 ASX Announcement.
11 Refer Alara’s 15 December 2016 ASX Announcement: Maiden JORC Ore Reserves – Al Hadeetha Copper-Gold Project
Project
11 Refer Alara’s 15 December 2016 ASX Announcement: Maiden JORC Ore Reserves – Al Hadeetha Copper-Gold Project
11 Refer Alara’s 15 December 2016 ASX Announcement: Maiden JORC Ore Reserves – Al Hadeetha Copper-Gold Project
12 Details of the modifying factors supporting the Ore Reserve are contained in Appendix 1 (JORC Code, 2012 Edition - Table 1) of
12 Details of the modifying factors supporting the Ore Reserve are contained in Appendix 1 (JORC Code, 2012 Edition - Table 1) of
12 Details of the modifying factors supporting the Ore Reserve are contained in Appendix 1 (JORC Code, 2012 Edition - Table 1) of
12 Details of the modifying factors supporting the Ore Reserve are contained in Appendix 1 (JORC Code, 2012
the 15 December 2016 announcement.
the 15 December 2016 announcement.
the 15 December 2016 announcement.
Edition - Table 1) of the 15 December 2016 announcement.
29
Alara Resources Annual Report 2020
Saudi Arabia
Khnaiguiyah Zinc-Copper Project
The Khnaiguiyah Zinc-Copper Project is located approximately 170km south-west of the Saudi
Arabian capital city Riyadh and 35km north-west of Al- Quwayiyah, a regional centre located
around the Riyadh to Jeddah Expressway.
The Khnaiguiyah Project previously comprised one mining licence, two exploration licences and
five exploration licence applications, totalling approximately 380km2, held or applied for by
United Arabian Mining Company (Manajem), a former JV partner of Alara in this project. The two
exploration licences expired, however Alara considers them not to be core to the Khnaiguiyah
Project. The mining licence was cancelled in or about December 2015, following a dispute
between Alara and Manajem.
As at the date of this report, the mining licence had not been reissued. As the holder of a Definitive
Feasibility Study into a zinc-copper Project at the site, Alara is in a prime position to take advantage
of the grant of any new mining licence over the project site.
30
Alara Resources Annual Report 2020 Directors’ Report
The Directors present their report on Alara Resources Limited (Company or Alara or AUQ) and the entities it controlled at the end of or during the financial
year ended 30 June 2020 (the Consolidated Entity).
REVIEW OF OPERATIONS
Al Hadeetha Copper-Gold Project
(Alara – 51%: Al Hadeetha Investments LLC – 30%; Al Tasnim Infrastructure Services LLC 19% (AHRL))
Oman
In May 2018 a Mining License was granted for the Company’s Al Hadeetha Copper-Gold Project in Oman (Al Hadeetha Project or Project).
The Al Hadeetha Project feasibility study financial modelling was revised in June 2018 to take account of the fact that copper prices had increased by more than
$1,000/t since the feasibility study, and more rapidly than previously forecast. Revised World Bank forecasts showed further projected copper price rises as
anticipated supply deficits open up. The Base Case financial modelling shows robust returns for the Project as follows (in USD)1:
•
•
•
•
•
Forecast Revenue over 10.4 years:
Forecast EBITDA over 10.4 years:
Forecast Free Cash Flow over 10.4 years:
Project NPV:
Forecast IRR:
$561 million
$252 million
$155 million
$90 million
34%
The Base Case used a flat copper price over life-of-mine of US$7,000/t: the LME average Cash Settlement Price for February 2018. The gold price is assumed
as US$1300/oz (real).
In recent months, copper prices have rebounded from a low US$4617/t in March to a high of US$6545/t in early July. These signs, along with gold at
~US$1900/oz see Project financials remaining strong with first copper production scheduled for Q1 2022.
A summary of case scenarios and associated financial returns are summarised in Tables 1 and 2 below.
Table 1. Copper and Gold prices used for Base Case, Market Case and High Case
Case Scenario
Base Case
Market Case
High Case
Based on flat Cu price equal to LME average Cash Settlement Price for
February 2018
Based on World Bank price forecast for 2018 to 20252 (excluding forecast
increase post 2025 to 7,000)
Based on investment bank projections and copper futures pricing3
Table 2. Financial Summary of Base Case, Market Case and High Case.
Cu
US$/t
7,000 for Life of Mine
Minimum 6,800
Maximum 6,900
7,050 rising to 8000
Total Revenue
US$ millions
Total Op. Ex.
US$ millions
EBITDA
US$ millions
NPV*
US$ millions
Case Scenario
Base Case
Market Case
561
553
275
275
252
244
High Case
*NPV is based on a discount rate of 6% calculated from indicative WACC and 80:20 debt to equity ratio%
622
275
309
90
85
120
Au
US$/oz
1,300
1,300
1,300
IRR %
34
32
40
Project Finance
Al Hadeetha Resources LLC (AHRL) accepted an OMR 20 million finance offer comprised of:
- OMR 10m (~AUD 38m) finance facility with Alizz Islamic Bank4, and
- OMR 10m (~AUD 38m) finance facility with Bank Nizwa5,
under a “club deal” between the above banks.6 Other than as disclosed above and the ARL drilling finance, discussed below, neither the Company nor its
related entities entered any material financing arrangements during the Reporting Period.
Project Development
Following a short pandemic-related hiatus, the Wash-hi Copper Project Management Consultancy Agreement with Progesys has been reactivated. Progesys
oversees and directs the engineering, procurement and construction (EPC) for the construction of the Company’s 1Mtpa copper concentrate plant at the Project.
Debisikha Associates, India (Debisikha) has been engaged to provide various Project services including:
1
2
3
Alara’s ASX Announcements dated 24 January 2017 and 28 June 2018 contain the information required by ASX Listing Rule 5.17 regarding the stated forecast financial information. All material
assumptions underpinning the financial forecast and the production target on which it is based as announced on 24 January 2017, except to the extent that those assumptions were updated in the
announcement of 28 June 2018, have not materially changed. The updated assumptions in the announcement of 28 June 2018 have not materially changed.
Released 24 April 2018: http://pubdocs.worldbank.org/en/458391524495555669/CMO-April-2018-Forecasts.pdf
www.metalbulletin.com/Article/3785039/FORECAST-Copper-price-to-hit-8000-per-tonne-in-2018-Goldman.html. Copper contracts traded on the Shanghai Futures Exchange at approximately
51,860 yuan ($8,003) per tonne as at 20 June 2018.
4 See the Company’s ASX announcement “Al Hadeetha Resources signs 10 Million OMR Finance Offer” dated 3 February 2020. Alizz Islamic Bank has since been acquired by Oman Arab Bank,
however this has not affected the finance deal.
5 See the Company’s ASX announcement “Al Hadeetha Resources Executes Second Bank Offer” dated 10 March 2020.
31
Alara Resources Annual Report 2020
Directors’ Report
•
•
•
•
•
Completion of FEED and preparation of technical specifications for all bought out items
Completion of detailed engineering for plant and infrastructure facilities (excluding geo-technical studies)
Preparation of technical bid documents for the onsite construction work
Expediting the vendor manufacturing process and delivery schedule
Inspection and co-ordination of any items to be sourced from India
Debisikha is an experienced consulting engineering company. Debisikha has worked on various EPC projects in India, Europe and the USA in the field of
mineral processing and base metal mining.
Debisikha is engaged under a fixed-price contract with a monthly payment schedule which allows for resource loading throughout the project development
schedule.
Metallurgical Drilling
The drilling program conducted by Alara Resources LLC, designed to obtain further metallurgical test samples for use in refining the plant design, is now
complete. Over 3400m was drilled in 22 diamond core holes to generate sufficient drill core from the Wash-hi deposit for test work and other project-related
requirements.
Metallurgical test work
The Feasibility Study projected the need for additional test work to be conducted at a later date, to revalidate earlier findings and to provide additional inputs for
the detailed engineering design phase.
Mr. Gary Patrick, MAusIMM, CP (Met) has been appointed to oversee the metallurgical test work program, to be carried out by Wardell Armstrong International,
UK. ALS Labs has been engaged to conduct the assays on the core intervals to enable selection and preparation of the metallurgical composites.
Mine construction
Al Hadeetha Resources LLC (AHRL) has executed a mine operation and ore grade management service agreement with Bedrock Mineral Resources Consulting
(BMRC). BMRC will provide key resources and software required for all day to day mine management activities related to ore and waste production, mine
planning, grade control and statutory JORC reporting.
Mr Ravi Sharma, Managing Director of BMRC, is a Chartered Member of the Australasian Institute of Mining and Metallurgy. Mr Sharma was a principal
consultant to Alara Resources in the definition of the Wash-hi copper deposit.
Project Development Timeline
Progesys has also been engaged to commence preparation of a detailed project plan and schedule – incorporating all project engineering, procurement and
plant and other infrastructure construction. A high-level project timeline is set out below, showing the expected timeframe for completion of the FEED through
to the first production of copper concentrate.
Mining Contractor
AHRL entered a preliminary commercial agreement with Alara Resources LLC (ARL) for ARL to perform mining services for AHRL over ten years at a cost of
$100m.
Project Water Supply
Approval was received from the Ministry of Housing for a 28km water supply pipeline route from the proposed Sewerage Treatment Plant (STP) site in Al
Mudhaibi to the project site. Similar approvals are also being sought from other Government authorities such as The Royal Oman Police (ROP), the
Telecommunication Authority, the Ministry of Agriculture and Municipalities.
Much of the waste water produced in the project area surrounds is currently not being recycled or treated. Alara is investigating potential methods of accessing
this water so it may be treated at the STP to supply the Al Hadeetha project. Alternative plans to access water from Petroleum Development Oman (PDO) wells
or other ground water options are also being developed.
The Company also investigated the option of having an external provider supply an STP on a Build, Own and Operate (BOO) model. Discussions with the
proponent revealed that the potential to achieve savings via this approach were not substantial.
Project Power Supply
A local electrical consultant has been engaged to conduct a survey and finalise the route of power lines between the project site and power authority Mazoon
feeder stations located about 5km away. The most plausible, 4km route for a 33kv power supply line has been submitted to Mazoon for approval.
Project Site Metallurgical Drilling
Drilling has continued at the project site to obtain metallurgical samples for processing plant design work. Drilling progress has continued throughout the period
with ~2000m of HQ/NQ samples collected with 98% core recovery. Potential for further optimisation of copper recoveries may also be investigated. ALS Global
has been engaged to conduct the geochemical analysis and Wardell Armstrong Lab in UK will conduct the metallurgical test work.
Industrial License
AHRL has added copper concentrate to its commercial registration in preparation for receiving an industrial licence to operate a copper processing plant. An
EIA was resubmitted to the MECA prior to the industrial licence application being lodged with the Ministry of Commerce and Industry. The Implementation
Support and Follow Up Unit (ISFU) advised that MECA had approved the application.
32
Alara Resources Annual Report 2020
Directors’ Report
AHRL Management Appointment
AHRL appointed Mr Avigyan Bera, formerly with MBE, as CEO. The role includes management of the Engineering and Construction contractors, procurement
processes (in connection with the Project Management Consultant) and project budgeting and scheduling. Mr Bera is a mechanical engineer with over 12 years’
project experience, including project planning, execution, commissioning and process engineering. Due to Covid-19 restrictions Mr Bera has commenced his
service from home until he is able to relocate to Oman.
Covid-19 Impacts
As at 21 September 2020 Oman had 94,000 cases of Covid-19 with 850 deaths from the pandemic. Government offices are open and working normally, as is
Alara’s Omani office. Company personnel have remained Covid-free and have continued to work, while taking necessary precautions. Former internal travel
restrictions in Oman have largely been lifted. The suspension of commercial flights into and out of the Sultanate is expected to be lifted in October, although the
full resumption of international travel will also depend upon policies in place at foreign airports.
The pandemic has had no substantial effect on the Company’s operations and it is not expected to do so. The principal work currently underway is Front End
Engineering and Design (FEED) for the Company’s proposed 1 Mtpa copper concentrate plant. FEED does not require the presence of engineers on site, and
was not significantly affected even by more restrictive Covid measures previously in effect.
Off-take agreements
A USD1.2 million advance payment made to the Consolidated Group by commodities trader Statdrome Pte Ltd under a 2017 off-take agreement has been
returned in full. The Company has executed a term sheet for a new off-take agreement and is discussing terms for further advance payments.
Alara Resources LLC
On 26 September 2018, the Group sold a 35% interest in Alara Resources LLC (ARL) to South West Pinnacle Exploration Limited (SWPE) for OMR 60,000
(AUD $214,442). The Group retains a 35% shareholding in ARL. On 24 January 2019, Al Tasnim Infrastructure Services LLC (Al Tasnim) became a 30%
shareholder in ARL7. ARL is now backed by three, actively engaged shareholders with complimentary experience and a common vision for the future of Oman’s
mining sector.
ARL secured a financing facility of up to OMR249,000 (~AUD$921,000) in connection with the purchase of two KORES-1200 drill rigs and associated
accessories. The drilling rigs were delivered to the Al Hadeetha Project site in September 2019.
With a new mining law now in effect, the Omani Public Authority for Mining (PAM) has ambitious plans to award 110 new multi-commodity exploration and
mining licences in the country.8 The procurement of the drill rigs and the provision of professional drilling services in Oman is aligned with these development
plans.
ARL’s first mining contract is with AHRL, as detailed above. Tender proposals have been prepared and submitted to other prospective clients.
A response to ARL’s first tender submission to a major Omani industrial mineral company has been postponed due to the impact of Covid-19.
Mineral Tenements
The current status of all mineral tenements and applications for the Al Hadeetha Project is presented in the table below.
Licence Name
Licence Owner
Alara JV
Interest
Exploration Licence
Mining Licence within EL
Area
Date of Grant Date of Expiry
Status
Area
Date of
Application
Status
Wash-hi Mazzaza
ML 10003075
Al Hadeetha
Resources LLC
Mullaq
Al Ajal
Al Hadeetha
Resources LLC
Al Hadeetha
Resources LLC
51%
39km2
Jan 2008
Nov 2016
Active*
3km2
2013
Active
51%
41km2
Oct 2009
Nov 2016
Active*
1km2
Jan 2013
Pending
51%
25km2
Jan 2008
Nov 2016
Active*
1.5km2
Jan 2013
Pending
*Pursuant to Ministerial decree (38/2013) which declares that the exploration licence ends when its duration ends, unless the licensee has submitted an application for a mining
licence, in which case the duration for the exploration licence extends until the date that a determination is made on the mining application.
Daris Copper-Gold Project
Oman
(Alara – 50% with option to increase to 70%: Al Tamman Trading Establishment LLC – 50%, of Daris Resources LLC (DRL))
The Daris project comprises two high-grade deposits within the 587km² exploration licence, which includes two mining licence applications covering 4.5km².
The project fits well with a “hub and spoke” model, which provides for processing of Daris ore at the Al Hadeetha copper concentration plant to be built 100km
to the south. However, new leach processing methods are also being investigated which could allow Daris to operate as a stand-alone project. The processing
method has been tested on deposits in Australia and South America and yielded very high recoveries of metal from both low-grade copper oxide and sulphide
ores.
7
8
See Alara’s ASX Announcement "Al Tasnim Acquires 30% stake in Alara JV Company" dated 24 January 2019.
See for example http://www.tradearabia.com/news/IND_351573.html
33
Alara Resources Annual Report 2020
Directors’ Report
The Daris East Mining Licence application, which covers an area that includes measured, indicated and inferred JORC copper resources9 was opposed by the
Ministry of Housing due to its proximity to recently allotted land. Review of a petition supporting the application lodged by Daris is underway at the Public
Authority for Mining (PAM).
The Daris 3A5 application for a Mining Licence is progressing well with the Government. Alara has been invited by the Ministry of Housing to discuss the
proposed size of the mining area.
Discussions for a joint exploration program to discover new mineralisation in Block 7 with Mineral Developments of Oman (MDO) progressed after MDO
conducted a detailed due diligence on Alara’s completed exploration programs over Block 7 and identified exploration targets for further work. While collaborative
efforts continue, no binding agreement between the parties has been reached.
Awtad Copper-Gold Project
Oman
(Alara right to subscribe for 10% initially with subsequent earn in up to 70%, with existing local shareholders holding the balance of Awtad Copper LLC)
The Awtad Project comprises an area of ~497 km² (Block 8) and is located immediately adjacent to the Block 7 (Daris Copper-Gold Project). Alara has a right
to an initial 10% interest (increasing to 50-70%+) in the concession owner, Awtad Copper LLC.
Exploration previously undertaken at this project includes:
•
86 line kilometres of airborne VTEM, 14 line kilometres of ground IP, 169 line kilometres of ground magnetics and 202 line kilometres of high-resolution
ground magnetics.
•
•
76 RAB drill holes totalling 1,747m and 11 core drill holes totalling 299m.
Drilling results (including over the Al Mansur Prospect) were low-grade in general and inconclusive.
Previous exploration identified anomalies worthy of further exploration. The fact that prospective geological formations within the licence area are under cover
of alluvial and aeolian deposits enhances the chances of further copper mineralisation.
Detailed work plans were submitted to PAM for renewal of the exploration licence, which remains pending. Meetings were held with the Company’s JV partners
in this project to register Alara’s interest in Awtad Resources LLC with the Ministry of Commerce.
Mineral Tenements
The current status of all mineral tenements and applications for the Daris and Awtad Projects are presented in the table below.
Block
Name
Licence Owner
Alara JV
Interest
Block 7
Al Tamman Trading
and Est. LLC
50% (earn in
to 70%)
Block 8
Awtad Resources
LLC
10% (earn in
to 70%)
Exploration Licence
Mining Licences within EL
Area
Date of
Grant
Date of
Expiry
Status
Area
Date of
Application
587km2
Nov 2009
Feb 2016
Active*
Daris 3A5 &
East
Resubmitted
2018
Status
Pending
597km2
Nov 2009
Oct 2013
Renewal pending
NA
NA
NA
*Pursuant to Ministerial decree (38/2013) which declares that the exploration licence ends when its duration ends, unless the licensee has submitted an application for a mining
licence, in which case the duration for the exploration licence extends until the date that a determination is made on the mining application.
Khnaiguiyah Zinc-Copper Project
Saudi Arabia
The Khnaiguiyah Project includes the development and operation of an open-cut zinc-copper mine and associated infrastructure over an approximate 13-year
mine life. Alara has invested over $30m into this Project, including:
•
•
over $3 million in payments to its former joint venture partners for transfer of the Mining Licence to the joint venture company; and
over $23 million to produce a definitive feasibility study with Proved and Probable JORC Reserves of 26.1Mt at 3.3% Zn and 0.24% Cu and a Base Case
Project NPV of $172 million at a zinc price of US$2,315/t10.
The project reached an impasse after the former licence holder, United Arabian Mining Company LLC, wrote to the Deputy Minister for Mineral Resources
asking to halt transfer of the mining licence to the JV company, contrary to the requirements of the JV agreement.
In December 2015, Alara announced it had been advised of the cancellation of the Khnaiguiyah Mining Licence. The cancellation became the subject of a legal
appeal by Manajem, a former JV partner of the Company. The appeal was dismissed, creating the potential for the licence to be reissued. Alara is working with
relevant parties in both the private and public sectors to prepare for a reissue of the licence. Alara funded - and is now in the unique position of holding - the
only bankable feasibility study for this project. Alara remains open to any reasonable solution for advancing the Khnaiguiyah Project to production.
The Company has communicated with the Saudi Arabian Council of Economic Development Affairs’ Priority Project Office (PPO) in respect to this Project.
These communications were later extended to include representatives from United Arabian Mining Company and Metals Corners Holdings. The PPO is a Saudi
government initiative empowered by HRH Mohammed Bin Salman, Crown Prince of Saudi Arabia in his capacity as President of Council for Economic and
Development Affairs. The PPO was established to assist selected private sector projects that face implementation difficulties and provide them with needed
support, as an authorised escalation entity, to obtain fast-track government approvals.
9
The Company has disclosed full details of these resources to investors on various occasions in a form which complies with the 2012 edition of the JORC Code. See, for example, the Company’s 2019
Annual Report to shareholders, p17.
10 Compared to the LME price of >$3,000/t as at 28 August 2018 and the High Case of US$2,373/t (see page 21 of the Company's 2013 Annual Report).
34
Alara Resources Annual Report 2020
The Minister of Industry and Mineral Resources bandar Bin Ibrahim Al-Khorayef recently announced the allocation of 54 mining reserve sites, including five zinc
sites, with one at Khnaiguiyah.
Directors’ Report
Corporate Information
Alara is a company limited by shares incorporated in Western Australia.
Cash Position
The Company’s cash position at 30 June 2020 was A$7.67 million (30 June 2019: A$7.56 million).
Company Officer Changes
On 28 July 2020, after the Reporting Period, Atmavireshwar Sthapak was appointed Managing Director. Prior to this appointment, Mr Sthapak was an Executive
Director of the Company. On 28 June 2020 Stephen Gethin was appointed a Non-Executive Director. On 2 July 2020, Mr Gethin was also appointed as Chairman
of the Board of Directors. On 2 July 2020 Mr James Phipps, previously Chairman, became a Non-Executive Director and on 4 September exited the Board.
Principal Activities
The principal activities of entities within the Consolidated Entity during the year were the exploration, evaluation and development of mineral exploration licenses
in Oman.
Significant Changes in the State of Affairs
There have been no significant changes in the state of affairs of the Consolidated Entity save as otherwise disclosed in this Directors’ Report or the financial
statements and notes thereto.
Dividends
No dividends have been paid or declared during the financial year.
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35
Alara Resources Annual Report 2020
Directors’ Report
Operating Results
Consolidated
Total revenue
Total expenses
Profit/Loss before tax
Income tax benefit
Profit/Loss after tax
Profit/(Loss) per Share
2020
$
2019
$
637,548
(652,514)
(14,966)
-
(14,966)
263,249
(582,368)
(319,119)
-
(319,119)
Consolidated
2019
Basic and Diluted profit/(loss) per share (cents)
(0.07)
Weighted average number of ordinary shares outstanding during the year used in the
calculation of basic loss per share
0.04
629,835,362
629,017,589
2020
Cash Flows
Consolidated
Net cash flow used in operating activities
Net cash flow from investing activities
Net cash flow provided by financing activities
Net change in cash held
Effect of exchange rates on cash
Cash held at year end
Financial Position
Outlined below is the Consolidated Entity’s Financial Position and prior year comparison.
Consolidated Entity
Cash
Trade and other receivables
Exploration & evaluation
Mine properties & Development assets
Investment in Associate
Term deposits
Other current assets
Non-Current assets
Total assets
Trade and other payables
Unearned Income
Financial liabilities
Provisions
Total liabilities
Net assets
Issued capital
Reserves
Accumulated losses
Parent interest
Non-controlling interest
Total equity
36
2020
$
(2,116,177)
2,272,954
(188,662)
(31,885)
144,094
7,674,616
2020
$
7,674,616
30,633
5,161,876
9,926,151
192,827
8,661
377,578
462,152
23,834,494
267,734
8,817
684,411
21,755
982,717
2019
$
(776,556)
5,138,340
(157,155)
4,204,629
10,835
7,562,407
2019
$
7,562,407
87,823
4,919,660
6,534,088
162,415
4,696,887
129,479
657,161
24,749,920
624,424
1,624,382
644,232
44,654
2,937,692
22,851,777
21,812,228
66,340,323
11,062,664
(54,440,424)
22,962,563
(110,786)
66,107,405
10,241,067
(54,714,409)
21,634,063
178,165
22,851,777
21,812,228
Alara Resources Annual Report 2020
Securities in the Company
Issued Capital
Fully paid ordinary shares, listed options and unlisted options on issue in the Company as at the date of this report are as follows:
Directors’ Report
Fully paid ordinary shares
quoted on ASX
634,886,315
634,886,315
Listed
options
-
-
Unlisted
options
-
-
Total
634,886,315
634,886,315
Total
Unlisted Options
During and subsequent to the end of the financial year, no unlisted options were issued.
Likely Developments and Expected Results
The Consolidated Entity intends to construct mining infrastructure for the Al Hadeetha Project, with the expected construction period being 19 months.
Thereafter, the Company intends to commence production and sale of copper and gold from the Al Hadeetha mine. Financial projections for the Al Hadeetha
Project are set out on page 2 of this Report. The Company intends to continue exploration, evaluation and development activities in relation to its other mineral
exploration licences in Oman in future years. The results of these activities depend on a range of technical and economic factors and also industry, geographic
and company specific issues.
Environmental Regulation and Performance
The Consolidated Entity holds licences and abides by Acts and Regulations issued by the relevant mining and environmental protection authorities of the
countries in which the Consolidated Entity operates. These licences, Acts and Regulations specify limits and regulate the management of discharges to the air,
surface waters and groundwater associated with exploration and mining operations as well as the storage and use of hazardous materials. There have been no
significant breaches of the Consolidated Entity’s licence conditions.
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37
Alara Resources Annual Report 2020
Directors’ Report
Board of Directors
The names and details of the directors of the Company in office during the financial year and until the date of this report are as follows.
Stephen Gethin
Barrister and Solicitor of the Supreme Court of Western Australia and of the High Court of Australia
Non-Executive Director 28 June to 2 July 2020
Non-Executive Chairman
Appointed Non-Executive Chairman on 2 July 2020
Non-Executive Director 11 January to 22 November 2019
Experience
Stephen Gethin is a highly regarded Director and lawyer with over 20 years’ experience in the provision of corporate legal advice and documentation and over
14 years’ experience in the role of General Counsel in ASX-listed companies in a range of industries, including resources, technology and investments. Prior to
founding a private legal practice in 2013, he served as General Counsel and Company Secretary of Strike Resources Limited (ASX:SRK) and before that held
the same roles at ERG Limited (ASX:ERG). Mr Gethin also provides legal advice to a number of other ASX-listed and large private companies.
Special Responsibilities
Chairman of the Remuneration and Nomination Committee and Member of the Audit Committee.
Other Directorships in Listed Companies in Past 3 Years
Nil
Atmavireshwar Sthapak
Bachelor of Applied Science and Master of Technology, Applied Geology
Experience
Managing Director
Appointed Managing Director on 28 July 2020
Executive Director 3 February 2016 to 28 July 2020
Non-Executive Director 22 September 2015 to 3 February 2016
Atmavireshwar Sthapak (MAusIMM) is a geologist specializing in mineral resource exploration and evaluation studies. He joined Alara in 2011, making valuable
contributions to the Company as an Exploration Manager and a Study Manager based in Muscat; including discovery of large VMS copper mineralisation
extensions at the Wash-hi project in Oman and recent resource upgrade at Washihi and Daris copper gold deposits. He played key roles in the Feasibility Study
and grant of mining license over Washihi project. Prior to Alara, his career spanned 10 years with ACC / ACC-CRA Ltd and 10 years with Rio Tinto (Australasia)
where he was awarded a Rio Tinto Discovery Award in 2009. He has worked on exploration around world-class deposits; including Mt. Isa type copper deposits
in Australia, and copper, gold and diamond mines on four continents.
Other Directorships in Listed Companies in Past 3 Years
Nil
James D. Phipps
BA (Philosophy), JD (Law)
Experience
Non-Executive Director
Non-Executive Director 3 July 2020 to 4 September 2020
Chairman 31 July 2015 to 2020
Non-Executive Director 1 November 2014
Previously Alternate Director to HRH Prince Abdullah (28 October 2013 to 1 November 2014)
James D. Phipps is a strategic advisor, entrepreneur, angel investor and people person. Jim practiced law (international commercial matters involving more
than 67 countries) in a big law firm environment (Jones Day Reavis & Pogue and Wiley Rein LLP) for 10 years and then moved over to the business side of the
house, where his work has involved business leadership, governance, entrepreneurship and strategic consulting. Jim has served on the boards of numerous
publicly traded and closely held companies across a number of industries, including mining/mining exploration (copper, zinc, gold and silver), heavy industry
(paper), consumer goods (paper, aluminium foil), infrastructure development and O&M (drinking water, waste water, storm water, etc.), technology (gaming and
social media), sports entertainment (English football, gaming, fantasy football, sports talk radio), fitness (establishment of the largest MMA gym in the Middle
East) and film making ("Dave Made a Maze"). Jim has headed up various board committees including executive, nomination and remuneration, audit and risk.
Jim currently serves on the board of MMA Global, Inc. (US OTC: Pink Sheets: LUSI), having been appointed in October 2018. Jim has conducted business on
four continents and has over 30 years of experience involving the Middle East. Jim is fluent in Arabic and lived full-time in the Arab world for about 18 years (15
years in Saudi Arabia and 3 years in Iraq). Jim is a combat veteran of the U.S. Army, having served in Operations Desert Shield and Desert Storm from 1990-
1991, on the front line with the Brave Rifles of the 3rd Armoured Cavalry Regiment. Jim also served three years as a civilian in harm’s way in Baghdad, Iraq
from 2008-2010. Jim holds a Bachelor of Arts in Philosophy (1992) and Juris Doctorate (1996) both from Brigham Young University. In 1994 and 1995, Jim
studied Islamic shariah as a Fulbright Fellow at the King Faisal Centre for Research and Islamic Studies in Riyadh, Saudi Arabia.
Other Directorships in Listed Companies in Past 3 Years
Nil
Justin J Richard
MBA, LLB, Grad Dip ACG, FGIA, FCIS, FAusIMM
Experience
Managing Director
Appointed 16 June 2015 to 27 July 2020
Justin Richard is a corporate lawyer and accomplished business manager. He joined Alara in 2011, and for the past eight years has been working in the Middle
East as CEO of Alara’s international joint venture companies Al Hadeetha Resources, Daris Resources and Alara Resources.
Since Mr Richard’s appointment as Managing Director, Alara has completed a feasibility study, announced a maiden ore reserve statement, and secured a
mining licence for the Al Hadeetha Copper Gold project in Oman. He has established key business relationships for the Company as it moves to expand its
38
Alara Resources Annual Report 2020
Directors’ Report
business beyond mineral exploration to mine development and production of copper concentrate. Prior to joining Alara, Mr Richard worked with UGL Limited
(Resources Division), Bateman Engineering and Minter Ellison Lawyers (Insurance & Corporate Risk, and Construction, Engineering and Infrastructure). He
has an MBA from London Business School, a law degree from the University of Western Australia and is a Fellow of the Governance Institute of Australia and
the Australasian Institute of Mining and Metallurgy.
Alternate Director
On 1 May 2018, Justin Richard appointed Stephen Gethin as his Alternate Director11. Mr Gethin’s experience and qualifications are set out below.
Other Directorships in Listed Companies in Past 3 Years
Nil
Vikas Jain
MBA
Non-Executive Director
Appointed 6 April 2016
Experience
Vikas Jain holds an MBA obtained in the USA and has a vast experience of around 19 years in the field of mineral exploration, mining, oil-field exploration and
allied activities. He is currently Managing Director and CEO of the Indian Company South West Pinnacle Exploration Limited (SWPE), founded by him in 2006
and also listed on the National Stock Exchange, India. Under his leadership and able guidance, this company has grown manifold and at present is a premier
exploration company in India. The company started primarily as a mineral exploration company and progressively added Coal Bed Methane (CBM) exploration
and production, aquifer mapping, HDD, geophysical logging, transportation and other geological activities into its domain. SWPE has recently ventured into 3D
& 2D seismic acquisition and processing for oil field exploration services. SWPE has recently been awarded contract for first integrated 2D seismic acquisition,
processing and exploration including drilling in coal block in India. He also has wide experience in open cast mining of various minerals and allied activities
through his earlier stint with other companies.
Special Responsibilities
Chairman of the Audit Committee and Member of the Remuneration and Nomination Committee.
Other Directorships in Listed Companies in Past 3 Years
South West Pinnacle Exploration Limited, listed on the National Stock Exchange, India.
Avi Sthapak
Non-Executive Director
Appointed 11 January 2019
Experience
Avi is a graduate with a degree in Computer Science Engineering with a focus on infrastructure management. Earlier, this year he completed his Master’s of
Business Administration from Curtin University, Perth with the key areas of study including strategy development, accounting, global mobility and talent
acquisition, marketing, leadership and finance. He has experience as a Business Development Consultant and a Junior Management Consultant. He worked
as a part time consultant for Live-in Learning for Curtin Exchange Project. The key areas here included creating a feasibility plan for a sustainable Solar Project
at Curtin Campus. Presently he is working as a marketing Assistant for Red Leaf Solutions.
Other Directorships in Listed Companies in Past 3 Years
Nil
Retired Directors
Mr Justin Richard stepped down as Managing Director on 27 July 2020. The other Directors all held office throughout the financial year and up to the date of
this report.
Company Secretary
Stephen Gethin
Company Secretary
Barrister and Solicitor of the Supreme Court of Western Australia and of the High Court of Australia
Appointed 1 May 2018 to 2 July 2020
Experience
Refer to Mr Gethin’s details above. After the end of the Reporting Period, on 2 July 2020, Mr Dinesh Agarwal was appointed Company Secretary.
Directors’ Interests in Shares and Options
As at the date of this report, the relevant interests of the Directors in shares and options held in the Company are:
Stephen Gethin
Atmavireshwar Sthapak
James Phipps
Vikas Jain
Fully Paid Ordinary Shares
-
2,951,451 12
-
37,745,93013
Options
-
-
-
-
12 Refer Alara’s 3 December 2018 ASX Announcement: Appendix 3Y. In connection with his appointment as Managing Director, the Company agreed to issue 5 million options to Mr Atmavireshwar
Sthapak, each exerciseable within one year after vesting, with an exercise price of AUD 0.03 each, to vest upon the Company achieving the first production of saleable copper concentrate by 31 March
2022. The issue of the options is subject to shareholders' approval, which will be sought at the Company's 2020 AGM.
13 Refer Alara’s 29 March 2019 ASX Announcement: Appendix 3Y.
39
Alara Resources Annual Report 2020
Directors’ Report
Avi Sthapak
Justin Richard
Directors’ Meetings
-
35,319,52614
-
-
The number of meetings and resolutions of directors (including meetings of committees of directors) held during the year and the number of meetings (or
resolutions) attended by each director were as follows:
Name of Director
Appointment / Resignation
Appointed 1 November 2014;
appointed member of
Audit Committee and
Remuneration Committee
30 June 2016
Appointed 16 June 2015
Appointed 22 September 2015
Appointed 6 April 2016
Appointed 11 January 2019
Appointed 11 May 2018
James Phipps
Justin Richard
Atmavireshwar
Sthapak
Vikas Jain
Avi Sthapak
Stephen Gethin
(alternate director to J
Richard)
Audit Committee
Board
Audit Committee
Meetings
Attended
Maximum
Possible
Meetings
Meetings
Attended
Maximum
Possible
Meetings
Remuneration and
Nomination Committee
Maximum
Possible
Meetings
Meetings
Attended
12
12
11
12
8
0
12
12
12
12
12
12
1
1
1
-
1
1
1
-
-
-
-
-
-
-
-
-
The Audit Committee currently comprises Non-Executive Directors, Vikas Jain (as Chairman) (since 6 April 2016), Non-Executive Director Stephen Gethin
(since 2 July 2020) and Managing Director Atmavireshwar Sthapak (since 28 September 2016).
The Audit Committee has a formal charter to prescribe its objectives, duties and responsibilities, access and authority, composition, membership requirements
of the Committee and other administrative matters. Its function includes reviewing and approving the audited annual and reviewed half-yearly financial reports,
ensuring a risk management framework is in place, reviewing and monitoring compliance issues, reviewing reports from management and matters related to
the external auditor. The Audit Committee Charter may be viewed and downloaded from the Company’s website.
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40
Alara Resources Annual Report 2020
Directors’ Report
REMUNERATION REPORT
The following information in the Remuneration Report has been audited. This Remuneration Report details the nature and amount of remuneration for each
Director and Company Executive (being a company secretary or senior manager with authority and responsibility for planning, directing and controlling the
major activities of the Company or Consolidated entity, directly or indirectly) (Key Management Personnel or KMP) of the Consolidated Entity in respect of the
financial year ended 30 June 2020.
Key Management Personnel
Directors
Stephen Gethin
James Phipps
Atmavireshwar Sthapak
Justin Richard
Vikas Jain
Avi Sthapak
Executives
Stephen Gethin
Avigyan Bera
Chairman (Appointed since the end of the Reporting Period. Non-Executive Director for part of the Reporting Period –
see above)
Non-Executive Director (Chairman during the Reporting Period)
Managing Director (appointed since the end of the Reporting Period. Non-Executive Director during the Reporting
Period – see above)
Managing Director (Resigned since the Reporting Period – see above)
Non-Executive Director
Non-Executive Director
Company Secretary (Resigned as Secretary on 2 July – see above)
CEO, AHRL
Remuneration and Nomination Committee
The Remuneration and Nomination Committee currently comprises Non-Executive Chairman, Stephen Gethin (member since 2 July 2020 and Chairman since
2 July 2020) and Non-Executive Director Vikas Jain (since 6 April 2016) and Managing Director Atmavireshwar Sthapak (since 28 June 2016).
The Remuneration and Nomination Committee has a formal charter to prescribe its purpose, key responsibilities, composition, membership requirements,
powers and other administrative matters. The Committee has a remuneration function (with key responsibilities to make recommendations to the Board on
policy governing the remuneration benefits of the Managing Director and Executive Directors, including equity-based remuneration and assist the Managing
Director to determine the remuneration benefits of senior management and advise on those determinations) and a nomination function (with key responsibilities
to make recommendations to the Board as to various Board matters including the necessary and desirable qualifications, experience and competencies of
Directors and the extent to which these are reflected in the Board, the appointment of the Chairman and Managing Director, the development and review of
Board succession plans and addressing Board diversity). The Remuneration and Nomination Committee Charter may be viewed and downloaded from the
Company’s website.
Remuneration Policy
The Board (with guidance from the Remuneration and Nomination Committee) determines the remuneration structure of all Key Management Personnel having
regard to the Consolidated Entity’s strategic objectives, scale and scope of operations and other relevant factors, including experience and qualifications, length
of service, market practice, the duties and accountability of Key Management Personnel and the objective of maintaining a balanced Board which has appropriate
expertise and experience, at a reasonable cost to the Company. The Board recognises that the performance of the Company depends upon the quality of its
Directors and Executives. To achieve its financial and operating objectives, the Company must attract, motivate and retain highly skilled Directors and
Executives.
The Company embodies the following principles in its remuneration framework:
•
•
Provide competitive rewards to attract and retain high calibre Executives.
Structure remuneration at a level that reflects the Executive’s duties and accountabilities and is competitive.
Remuneration Structure
The structure of Non-Executive Director and Executive Director remuneration is separate and distinct.
Director Remuneration
Objective
The Board seeks to set aggregate remuneration (for directors) at a level which provides the Company with the ability to attract and retain directors of the highest
calibre, whilst incurring a cost which is acceptable to shareholders.
Structure
The Company’s constitution and the ASX Listing Rules specify that the aggregate remuneration of non-executive directors shall be determined from time to
time by a general meeting. An amount not exceeding the amount determined is then divided between the directors as agreed. The latest determination was at
the General Meeting held on 26 May 2011 where shareholders approved an aggregate remuneration of $275,000 per year. The amount of aggregate
remuneration sought to be approved by shareholders and the manner in which it is apportioned amongst directors is reviewed annually. The Board considers
fees paid to non-executive directors of comparable companies when undertaking the annual review process. Each Non-Executive Director receives a fee for
being a director of the Company and for sitting on relevant board committees. The fee size is commensurate with the workload and responsibilities undertaken.
41
Alara Resources Annual Report 2020
Directors’ Report
Managing Director and Senior Executive Remuneration
Objective
The Company aims to reward executives with a level and mix of remuneration commensurate with their position and responsibilities within the Company and
so as to ensure total remuneration is competitive by market standards. Formal employment contracts are entered into with the Managing Director and senior
executives. Details of these contracts are outlined later in this report.
Consequences of Company Performance on Shareholder Wealth
In considering the Company’s performance and benefits for shareholder wealth, the Board have regard to the following information in relation to the current
financial year and the previous four financial years:
Total Equity
Basic earnings/(loss) per share – cents
Net Profit/(Loss) attributable to members
Market Capitalisation
Fixed Remuneration
2020
2019
2018
2017
2016
$22.9m
0.04
273,985
$8.3m
$21.8m
(0.07)
$10.4m
(0.11)
$9.5m
(0.04)
$8.4m
(7.42)
(454,577)
(691,512)
(258,526)
(30,595,088)
$15.1m
$18.2m
$8.4m
$14m
During the financial year, the Key Management Personnel of the Company are paid a fixed base salary/fee per annum plus applicable employer superannuation
contributions, as detailed below (Details of Remuneration Provided to Key Management Personnel).
Performance Related Benefits/Variable Remuneration
Performance related benefits/variable remuneration payable to Key Management Personnel is disclosed in the table Details of Remuneration Provided to Key
Management Personnel. Justin Richard was paid expat allowances, including house, school, travel and medical insurance and Atmavireshwar Sthapak was
paid allowances including house, travel and medical insurance.
Special Exertions and Reimbursements
Pursuant to the Company’s Constitution, each Director is entitled to receive:
•
•
Payment for the performance of extra services or the undertaking of special exertions at the request of the Board and for the purposes of the Company.
Payment for reimbursement of all reasonable expenses (including traveling and accommodation expenses) incurred by a Director for the purpose of
attending meetings of the Company or the Board, on the business of the Company, or in carrying out duties as a Director.
Post-Employment Benefits
Other than employer contributions to nominated complying superannuation funds or gratuity of Key Management Personnel (where applicable) and entitlements
to accrued unused annual and long service leave (where applicable), the Company does not presently provide retirement benefits to Key Management
Personnel.
The Company notes that shareholder approval is required where a Company proposes to make a “termination payment” (for example, a payment in lieu of
notice, a payment for a post-employment restraint and payments made as a result of the automatic or accelerated vesting of share based payments) in excess
of one year’s “base salary” (defined as the average base salary over the previous 3 years) to a director or any person who holds a managerial or executive
office.
Long-Term Benefits
Other than early termination benefits disclosed in ‘Employment Contracts’ below, Key Management Personnel have no right to termination payments save for
payment of accrued unused annual and long service and/or end of service leave (where applicable).
[The remainder of this page is intentionally blank]
42
Alara Resources Annual Report 2020
Directors’ Report
Details of Remuneration Provided to Key Management Personnel.
Key Management
Person
Perfor-
mance
based Fixed
Short-term benefits
Cash payments
Post-employment
benefits
Other long-
term benefits
Equity
based
benefits
At risk
STI
Options
related
Salary,
and fees
Allo-
wances(i)
Cash
Bonus
Non-
cash(ii) Other(iii)
Super-
annuation
Termi-
nation
Other Options
Total
2020
%
%
%
%
$
$
$
$
$
$
$
$
$
$
Executive Directors:
Justin Richard
Atmavireshwar
Sthapak
-
-
100%
100%
Non-Executive Directors:
James Phipps
Vikas Jain
Stephen Gethin
Avi Sthapak
-
-
-
-
100%
100%
-
-
Company Secretary:
Stephen Gethin(iv)
-
100%
Chief Executive Officer of AHRL
-
-
-
-
-
-
-
Avigyan Bera
-
100%
-
-
6,871
Notes:
- 381,045
149,943
- 253,404
29,878
- 152,519
-
-
-
-
50,000
-
-
39,105
-
-
-
-
-
-
-
-
12,097
1,433
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
37,987
21,118
-
-
-
-
-
-
-
-
-
-
-
-
-
-
581,072
305,833
152,519
50,000
-
-
39,105
6,871
-
-
-
-
-
-
(i) Allowances are based on the executive agreement and may include expat allowance, company car
allowance, rent allowance and security bond, and school allowance received from subsidiaries and
related joint venture entities.
(iii) Other short-term benefits consist of exchange gain/(loss) due to foreign currency translation
from Oman Riyal to Australia Dollars to Australian Dollars on Mr Richard’s salary.
(iv) Appointed 1 May 2018. Remuneration, in his capacity as Company Secretary, paid to Fortuna
(ii) Non-cash benefits include net leave and/or end of service gratuity accrued or paid pursuant to
Advisory Group.
relevant labour laws.
Short-term benefits
Cash payments
Post-employment
benefits
Other
long-
term
benefits
Equity
based
benefits
Total
End of
Servic
e(iv) /
Termi-
nation
Other Options
Key Management Person
Perfor-
mance
based
At risk
STI
Fixed
Option
s
related
Salary,
and fees
Allo-
wances(i)
Cash
Bonus
Non-
cash(ii) Other(iii)
Super-
annuation
2019
%
%
%
%
$
$
$
$
$
$
$
$
$
$
Executive Directors:
Justin Richard
Atmavireshwar Sthapak(v)
-
-
100%
100%
-
-
Non-Executive Directors:
James Phipps
Vikas Jain(vi)
Stephen Gethin
-
-
-
100%
100%
100%
Company Secretary:
Stephen Gethin
-
100%
-
-
-
-
-
-
-
-
-
-
374,101
249,508
160,307
28,305
- 23,440
1,400
-
75,000
50,000
39,105
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
12,486
10,320
-
-
-
-
-
-
-
-
-
-
-
-
-
-
570,334
289,533
75,000
50,000
-
39,105
Notes:
(i) Allowances are based on the executive agreement and may include company car
allowance, rent allowance and security bond, and school allowance received from
subsidiaries and related joint venture entities.
(ii) Non-cash benefits include net annual leave expensed but not paid during the year.
(iii) Other short-term benefits consist of exchange gain/(loss) due to foreign
currency translation from Oman Riyal to Australia Dollars and Saudi Riyal
to Australian Dollars on Mr Richard’s salary.
Equity Based Benefits
(iv) Under Omani labour law, an End of Service Gratuity is payable upon termination of employment.
(v) Appointed 2 September 2015 with remuneration and allowances commencing January 2016.
(vi) Appointed 6 April 2016
(vii) Appointed 30 June 2015, remuneration paid to Corporate Board Services.
The Company has not provided any equity based benefits (e.g. grant of shares or options) to Key Management Personnel during the financial year. No shares
were issued as a result of the exercise of options held by Key Management Personnel during the financial year.
43
Alara Resources Annual Report 2020
Directors’ Report
Options Lapsed During the Year
During the financial year, 3,000,000 options with a value, on issue, of $20,000 expired without being exercised.
Details of Shares Held by Key Management Personnel
2020
Name of Director/KMP
Justin Richard
Atmavireshwar Sthapak(ii)
James Phipps
Vikas Jain
Stephen Gethin(iv)
2019
Name of Director/KMP
Justin Richard
Atmavireshwar Sthapak(ii)
James Phipps
Vikas Jain
Avi Sthapak
Stephen Gethin(iv)
Balance at
1 July 2019
Balance at
appointment
Net change
Balance at
cessation
Balance at
30 June 2020
Ordinary Fully Paid Shares
34,119,526
2,544,838
-
37,745,930
1,200,000
406,613
-
-
-
-
Ordinary Fully Paid Shares
35,319,526(i)
2,951,451
-
37,745,930
-
Balance at
1 July 2018
Balance at
appointment
33,369,526
1,951,451
-
34,285,230
Net change
750,000
593,387
-
3,460,700
-
-
Balance at
cessation
Balance at
30 June 2019
34,119,526(i)
2,544,838
-
37,745,930
-
Notes:
(i) Includes shares held / acquired by Mr Richard’s spouse. Mr Richard submitted a request for trading approval to the Company on 2 occasions during the period.
(ii) Mr Sthapak submitted a request for trading approval to the Company on 1 occasion during the relevant period. (iii) Resigned 30 April 2018. (iv) Appointed 1 May 2018.
[The remainder of this page is intentionally blank]
44
Alara Resources Annual Report 2020
Directors’ Report
Details of Options Held by Key Management Personnel
No options are held by Key Management Personnel during or at the end of the financial year (2019: NIL).
Employment Contracts
(a)
Former Managing Director/CEO – Justin Richard
Justin Richard was appointed the Company’s Legal & Commercial Manager in August 2011 and Alara’s Country Manager for Saudi Arabia in November 2012
and Oman in December 2013. He was appointed Managing Director on 16 June 2015. He resigned as Managing Director on 27 July 2020. The terms of his
employment contract were carried over from his previous agreement contract with no increase in salary or allowance, the material terms of which are as follows:
•
One-year term with annual base salary of A$381,045 (subject to adjustments for exchange rate variations* for salary paid in Omani Rial. His employment
contract was subsequently extended on the same terms indefinitely;
•
•
•
•
•
Expatriate allowances (including housing, school and travel) totalling approximately A$175,000 per annum (subject to adjustments for exchange rate
variations*);
Provision of medical insurance cover;
Standard annual leave (20 days) and personal/sick leave (10 days paid) entitlements plus any additional entitlements prescribed under relevant Labour
Law;
Compulsory statutory ‘end of service’ payments due under Omani Law; and
One month’s notice of termination within first six months, subject to repatriation provisions which total approximately three months remuneration.
*Exchange rate variations based on rates prevailing at the time the expatriate assignments commenced.
(b)
Technical Director – Atmavireshwar Sthapak (during the Reporting Period – since appointed Managing Director)
Use of a company car;
An annual base salary of OMR 67,200 per annum;
Atmavireshwar Sthapak was appointed Non-Executive Director on 22 September 2015, Executive Director on 3 February 2016 and subsequently appointed
Managing Director on 27 July 2020. The material terms of his contract in effect during the Reporting Period were as follows14:
•
•
•
•
•
•
Standard annual leave (20 days) and personal/sick leave (10 days paid) entitlements plus any additional entitlements prescribed under Oman Labour
Law; and
Compulsory statutory ‘end of service’ payments due under Oman Labour Law;
Allowances totalling up to OMR 10,200 per annum;
Provision of medical insurance cover;
•
Either party may terminate the agreement by providing three months’ notice.
(c)
Other Executives
Details of the material terms of formal employment/consultancy agreements (as the case may be) between the Company and other Key Management Personnel
during the period are as follows:
Key Management
Personnel and
Position(s) Held
Stephen Gethin
Director and Company
Secretary
Relevant Date(s)
Base Salary/Fees per annum
Other Terms
1 May 2018 to 2 July
2020
$39,105 plus GST per annum. (The Company pays
Fortuna Advisory group $110,400 as a combined
amount for Company Secretarial and Chief Financial
Officer services. Mr Gethin is a consultant to Fortuna
Advisory Group through Fortuna Legal Pty Ltd, of which
he is a director. Of the annual fee received by Fortuna
Advisory Group, it pays Fortuna Legal $39,105).
Initially appointed under a one year
fixed-term contract expiring on 30
April 2019, reviewable at the end of
the year, extended on the same terms
for two additional years, currently
expiring on 30 April 2020. Extended
until 31 July 2021.
Other Benefits Provided to Key Management Personnel
No Key Management Personnel has during or since the end of the financial year, received or become entitled to receive a benefit, other than a remuneration
benefit as disclosed above, by reason of a contract made by the Company or a related entity with the Director or with a firm of which he is a member, or with a
Company in which he has a substantial interest. There were no loans to directors or executives during the reporting period.
Employee Share Option Plan
The Company has an Employee Share Option Plan (the ESOP) which was most recently approved by shareholders at the 2017 Annual General Meeting. The
ESOP was developed to assist in the recruitment, reward, retention and motivation of employees (excluding Directors) of Alara. Under the ESOP, the Board
will nominate personnel to participate and will offer options to subscribe for shares to those personnel. A summary of the terms of ESOP is set out in Annexure
A to Alara’s Notice of Annual General Meeting and Explanatory Statement for its 2017 AGM. No securities were issued to KMP under the ESOP during the
financial year (2019: Nil).
14 Refer Alara’s 3 February 2016 ASX Announcement: “Appointment of Executive Director”.
45
Alara Resources Annual Report 2020
Directors’ Report
Director Loan Agreement
There were no loan agreements with the Directors during the year.
Securities Trading Policy
The Company has a Securities Trading Policy, a copy of which is available for viewing and downloading from the Company’s website.
Voting and Comments on the Remuneration Report at the 2019 Annual General Meeting
At the Company’s most recent (2019) Annual General Meeting (AGM), a resolution to adopt the 2019 Remuneration Report was put to a vote and passed
unanimously on a show of hands with the proxies received also indicating majority (99.96%) support in favour of adopting the Remuneration Report.15 No
comments were made on the Remuneration Report at the AGM.
Engagement of Remuneration Consultants
The Company engaged a remuneration consultant Godfrey Remuneration Group Pty Limited to provide remuneration recommendations in relation to the
remuneration of the Managing Director and the Non-Executive Directors during the year.
The Board has established a policy for engaging external remuneration consultants which includes, inter alia, that the Remuneration and Nomination Committee
be responsible for approving all engagements of and executing contracts to engage remuneration consultants and for receiving remuneration recommendations
from remuneration consultants regarding Key Management Personnel and to ensure that the making of remuneration recommendations would be free from
undue influence by the member or members of the key management personnel to whom the recommendation relates.
The policy was complied with in relation to the above appointment. In the case of the appointment of this remuneration consultant all communications between
the Company and the consultant were handled on the Company’s part by the Chairman of the Remuneration and Nomination Committee (Committee
Chairman) who is also the Chairman of the Board. The Committee Chairman is satisfied that there was no undue influence on the remuneration consultant by
any member of key management personnel to whom the remuneration consultant’s recommendations related. The remuneration consultant included with its
remuneration recommendation a declaration that its recommendation was made free from undue influence by the members of the key management personnel
to whom the recommendation related. The remuneration consultant is a leading and highly respected consultant within the Australian listed company
remuneration advisory field.
For the reasons specified above the Board is satisfied that the remuneration recommendations were made free from undue influence by the members of key
management personnel to whom they relate. The remuneration consultant did not provide any other kind of advice to the Company. The Company paid the
remuneration consultant $16,000 plus GST for its remuneration recommendation.
This concludes the audited Remuneration Report.
Directors’ and Officers’ Insurance
The Company did not have a policy of Directors’ and Officers’ Insurance during the reporting period.
Directors’ Deeds
In addition to the rights of indemnity provided under the Company’s Constitution (to the extent permitted by the Corporations Act), the Company has also entered
into a deed with each of the Directors (Officers) to regulate certain matters between the Company and each Officer, both during the time the Officer holds office
and after the Officer ceases to be an officer of the Company, including the following matters:
•
The Company’s obligation to indemnify an Officer for liabilities or legal costs incurred as an officer of the Company (to the extent permitted by the
Corporations Act).
•
Subject to the terms of the deed and the Corporations Act, the Company may advance monies to Officers to meet any costs or expenses of the Officer
incurred in circumstances relating to the indemnities provided under the deed and before the outcome of legal proceedings brought against the Officer.
Legal Proceedings on Behalf of Consolidated Entity (Derivative Actions)
No person has applied for leave of a court to bring proceedings on behalf of the Consolidated Entity or intervene in any proceedings to which the Consolidated
Entity is a party for the purpose of taking responsibility on behalf of the Consolidated Entity for all or any part of such proceedings and the Consolidated Entity
was not a party to any such proceedings during and since the financial year.
Auditor
Details of the amounts paid or payable to the Company’s auditors (Rothsay Auditing for 30 June 2020 and RSM Chartered Accountants for the Oman entity
audits) for audit and non-audit services provided during the financial year are set out below (refer to Note 5):
Audit and Review Fees
$
31,832
Fees for Other Non-Audit Services
$
–
Total
$
31,832
No non-audit services were provided by the Auditors during the year.
Auditor’s Independence Declaration
A copy of the Auditor’s Independence Declaration as required under section 307C of the Corporations Act 2001 forms part of this Directors Report and is set
15 Refer Alara’s 17 November 2017 ASX Announcement: Results of Meeting.
46
Alara Resources Annual Report 2020
Directors’ Report
out on page 21. This relates to the Auditor’s Report, where the Auditors state that they have issued an Independence Declaration.
Events Subsequent to Reporting Date
The Directors are not aware of any matters or circumstances at the date of this Directors’ Report, other than those referred to in this Directors’ Report or the
financial statements or notes thereto set out on page 44, that have significantly affected or may significantly affect the operations, the results of operations or
the state of affairs of the Company and Consolidated Entity in subsequent financial years.
Signed for and on behalf of the Directors in accordance with a resolution of the Board:
Atmavireshwar Sthapak
Managing Director
25 September 2020
47
Alara Resources Annual Report 2020
Independent Auditor’s Declaration
The Directors
Alara Resources Limited
Suite 1.02
110 Erindale Road
Balcatta WA 6021
The Directors
Dear Directors
Alara Resources Limited
Suite 1.02
In accordance with Section 307C of the Corporations Act 2001 (the "Act") I hereby declare that to the best
110 Erindale Road
of my knowledge and belief there have been:
Balcatta WA 6021
(i) no contraventions of the auditor independence requirements of the Act in relation to the audit of
the 30 June 2020 financial statements; and
Dear Directors
(ii) no contraventions of any applicable code of professional conduct in relation to the review.
In accordance with Section 307C of the Corporations Act 2001 (the "Act") I hereby declare that to the best
This declaration is in respect of Alara Resources Limited and the entities it controlled during the year.
of my knowledge and belief there have been:
(i) no contraventions of the auditor independence requirements of the Act in relation to the audit of
the 30 June 2020 financial statements; and
(ii) no contraventions of any applicable code of professional conduct in relation to the review.
This declaration is in respect of Alara Resources Limited and the entities it controlled during the year.
Daniel Dalla CA (Lead auditor)
Partner
Rothsay Auditing
Dated 25 September 2020
Daniel Dalla CA (Lead auditor)
Partner
Rothsay Auditing
Dated 25 September 2020
48
Alara Resources Annual Report 2020 In accordance with Section 307C of the Corporations Act 2001 (the "Act") I hereby declare that to the best
110 Erindale Road
of my knowledge and belief there have been:
Balcatta WA 6021
(i) no contraventions of the auditor independence requirements of the Act in relation to the audit of
the 30 June 2020 financial statements; and
Dear Directors
(ii) no contraventions of any applicable code of professional conduct in relation to the review.
In accordance with Section 307C of the Corporations Act 2001 (the "Act") I hereby declare that to the best
This declaration is in respect of Alara Resources Limited and the entities it controlled during the year.
of my knowledge and belief there have been:
(i) no contraventions of the auditor independence requirements of the Act in relation to the audit of
the 30 June 2020 financial statements; and
This declaration is in respect of Alara Resources Limited and the entities it controlled during the year.
The Directors
Alara Resources Limited
Suite 1.02
110 Erindale Road
Balcatta WA 6021
The Directors
Dear Directors
Alara Resources Limited
Suite 1.02
Daniel Dalla CA (Lead auditor)
Partner
Rothsay Auditing
Dated 25 September 2020
Daniel Dalla CA (Lead auditor)
Partner
Rothsay Auditing
Dated 25 September 2020
Consolditaed Statement of Profit and Loss and
other Comprehensive Income
for the year ended 30 june 2020
Revenue
Other income
Gain/(Loss) on Forex
Personnel
Occupancy Costs
Finance expense
Corporate expenses
Gain/(Loss) on disposal of subsidiary
Administration expenses
Share of profit/(losses) of associates
PROFIT/(LOSS) BEFORE INCOME TAX
Income tax benefit
PROFIT/(LOSS) FOR THE YEAR
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations
Total other comprehensive income/(loss)
Note
3
3
3
11
2020
$
477,951
164,901
(5,304)
(244,548)
(46,438)
(1,023)
(132,856)
-
(258,061)
30,412
(14,966)
2019
$
97,401
165,848
-
(426,714)
(38,356)
(142,311)
(69,115)
425,895
(279,740)
(52,027)
(319,119)
-
-
(14,966)
(319,119)
841,597
740,869
841,597 740,869
(ii) no contraventions of any applicable code of professional conduct in relation to the review.
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR
826,631
421,750
Profit/(loss) attributable to:
Owners of Alara Resources Limited
Non-controlling interest
Total comprehensive income/(loss) for the year attributable to:
Owners of Alara Resources Limited
Non-controlling interest
273,985
(288,951)
(454,577)
135,458
(14,966)
(319,119)
1,115,582
(288,951)
286,292
135,458
826,631
421,750
Earnings/Loss per share:
Basic earnings/(loss) per share cents
Diluted earnings/(loss) per share cents
6
6
0.04
0.04
(0.07)
(0.07)
The accompanying notes form part of this consolidated financial statement.
49
Alara Resources Annual Report 2020
Consolidated Statement of Financial Position
As at 30 June 2020
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Other current assets
Financial assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Financial assets
Investment in Associate
Property, plant and equipment
Mine properties & Development assets
Exploration and evaluation
TOTAL NON CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Unearned income
Provisions
TOTAL CURRENT LIABILITIES
NON CURRENT LIABILITIES
Financial liabilities
Provisions
TOTAL NON CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
Parent interest
Non-controlling interest
TOTAL EQUITY
The accompanying notes form part of this consolidated financial statement.
50
Note
7
8
9
10
10
11
12
12
13
14
15
16
17
16
18
19
2020
$
7,674,616
30,633
377,578
8,661
2019
$
7,562,407
87,823
129,479
4,696,887
8,091,488
12,476,596
422,342
192,827
39,810
9,926,151
5,161,876
15,743,006
617,667
162,415
39,494
6,534,088
4,919,660
12,273,324
23,834,494
24,749,920
267,734
8,817
21,755
624,424
1,624,382
8,390
298,306
2,257,196
684,411
-
644,232
36,264
684,411
680,496
982,717
2,937,692
22,851,777
21,812,228
66,340,323
11,062,664
(54,440,424)
22,962,563
(110,786)
66,107,405
10,241,067
(54,714,409)
21,634,063
178,165
22,851,777
21,812,228
Alara Resources Annual Report 2020
Consolidated Statement of Changes in Equity
As at 30 June 2020
Director’s Report
$
l
a
t
o
T
9
6
8
,
0
4
7
9
6
8
,
0
4
7
)
9
1
1
,
9
1
3
(
0
5
7
,
1
2
4
0
7
6
,
7
9
4
,
0
1
3
5
8
,
3
9
5
,
8
)
3
9
1
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T
Alara Resources Annual Report 2020
Consolidated Statement of Cash Flows
for the year ended 30 June 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers and employees (inclusive of GST)
Interest received
Note
2020
$
(2,670,073)
553,896
2019
$
(790,802)
14,246
NET CASHFLOWS USED IN OPERATING ACTIVITIES
7b
(2,116,177)
(776,556)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from disposal of plant and equipment
Payments for plant and equipment
Payments for exploration and evaluation activities
Payments for development expenditure
Loan to other entity (repayment)
Proceeds from disposal of investments
-
(9,146)
-
(3,185,950)
195,325
5,272,725
1,277
(4,505)
(1,176,094)
(227,893)
(4,696,887)
11,242,442
NET CASHFLOWS USED IN INVESTING ACTIVITIES
2,272,954
5,138,340
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuing ordinary shares
Loans to other entities
Transaction cost related to borrowings
232,918
-
(421,580)
-
(157,155)
-
NET CASHFLOWS PROVIDED BY FINANCING ACTIVITIES
(188,662)
(157,155)
NET INCREASE / DECREASE IN CASH AND CASH EQUIVALENTS HELD
(31,885)
4,204,629
Cash and cash equivalents at beginning of the financial year
Effect of exchange rate changes on cash
7,562,407
144,094
3,346,943
10,835
CASH AND CASH EQUIVALENTS AT THE END OF THE FINANCIAL YEAR
7
7,674,616 7,562,407
The accompanying notes form part of this consolidated financial statement.
52
Alara Resources Annual Report 2020
for the year ended 30 June 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
1.
SUMMARY OF ACCOUNTING POLICIES
Statement of Significant Accounting Policies
The principal accounting policies adopted in the preparation of these financial statements are set out below.
The financial report includes the financial statements for the Consolidated Entity consisting of Alara Resources Limited and its controlled and jointly
controlled entities. Alara Resources Limited is a company limited by shares, incorporated in Western Australia, Australia and whose shares are
publicly traded on the Australian Securities Exchange (ASX).
1.1.
Basis of preparation
These general-purpose financial statements have been prepared in accordance with Australian Accounting Standards, Australian Accounting
Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. Alara Resources
Limited is a for-profit entity for the purposes of preparing the financial statements.
Compliance with IFRS
The consolidated financial statements of the Consolidated Entity, Alara Resources Limited, also comply with International Financial Reporting
Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
Reporting Basis and Conventions
The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current
assets, and financial assets and financial liabilities for which the fair value basis of accounting has been applied.
Going Concern Assumption
The financial statements have been prepared on the going concern basis of accounting which assumes the continuity of normal business activities
and realisation of assets and settlement of liabilities in the ordinary course of business.
The Group has incurred a loss for the year ended 30 June 2020 of $14,966 (2019: Loss - $319,119) and cash inflows from operating and investing
activities of $156,777 (2019: $4,361,784). As at 30 June 2020 the Group has a cash at bank balance of $7,674,616 (2019: $7,562,407) and bank
deposits of $8,661 (2019: 4,696,887) and working capital of $7,793,182 (2019: $10,219,400).
The directors have prepared a cash flow forecast, which indicates that the Group will have sufficient cash flows to meet all commitments and working
capital requirements for the 12-month period from the date of signing this financial report. Based on the cash flow forecast, the directors are satisfied
that the going concern basis of preparation is appropriate.
1.2.
Principles of Consolidation
The consolidated financial statements incorporate the assets and liabilities of the subsidiaries of Alara Resources Limited as at 30 June 2020 and
the results of its subsidiaries for the year then ended. Alara Resources Limited and its subsidiaries are referred to in this financial report as the
Consolidated Entity. All transactions and balances between Consolidated Entity companies are eliminated on consolidation, including unrealised
gains and losses on transactions between Consolidated Entity companies. Where unrealised losses on intra-group asset sales are reversed on
consolidation, the underlying asset is also tested for impairment from a Consolidated Entity perspective. Amounts reported in the financial statements
of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Consolidated Entity. Profit or
loss and other comprehensive income of subsidiaries acquired or disposed of during the year are recognised from the effective date of acquisition,
or up to the effective date of disposal, as applicable. Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s
profit or loss and net assets that is not held by the Consolidated Entity. The Consolidated Entity attributes total comprehensive income or loss of
subsidiaries between the owners of the parent and the non-controlling interests based on their respective ownership interests.
1.3.
Foreign Currency Translation and Balances
Functional and presentation currency
The functional currency of each entity within the Consolidated Entity is measured using the currency of the primary economic environment in which
that entity operates. The consolidated financial statements are presented in Australian dollars which is the parent entity’s functional and presentation
currency.
Transaction and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign
currency monetary items are translated at the year-end exchange rate. Exchange differences arising on the translation of monetary items are
recognised in profit or loss, except where deferred in equity as a qualifying cash flow or net investment hedge. Exchange differences arising on the
translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity, otherwise the
exchange difference is recognised in profit or loss.
Consolidated entity
The financial results and position of foreign operations whose functional currency is different from the Consolidated Entity’s presentation currency
are translated as follows:
(a) assets and liabilities are translated at year-end exchange rates prevailing at that reporting date;
(b) income and expenses are translated at average exchange rates for the period; and
(c) retained earnings are translated at the exchange rates prevailing at the date of the transaction.
53
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
1
SUMMARY OF ACCOUNTING POLICIES (Continued)
Exchange differences arising on translation of foreign operations are transferred directly to the Consolidated Entity’s foreign currency translation
reserve in the statement of financial position. These differences are recognised in profit or loss in the period in which the operation is disposed.
1.4.
Joint Arrangements
Joint arrangements exist when two or more parties have joint control. Joint control is the contractually agreed sharing of control of an arrangement,
which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control, in the event the Company
does not share control the financials are consolidated (or deconsolidated in the event of loss of control) (refer to 1.2 for further information). The
Consolidated Entity’s joint arrangements are currently of one type:
Joint operations
Joint operations are joint arrangements in which the parties with joint control have rights to the assets and obligations for the liabilities relating to the
arrangement. The activities of a joint operation are primarily designed for the provision of output to the parties to the arrangement, indicating that:
•
•
the parties have the rights to substantially all the economic benefits of the assets of the arrangement; and
all liabilities are satisfied by the joint participants through their purchases of that output. This indicates that, in substance, the joint participants
have an obligation for the liabilities of the arrangement.
1.5.
Leases
In the current year, the Group has applied AASB 16 that is effective for annual periods that begin on or after 1 January 2019. AASB 16 introduces a
single lessee accounting model that eliminates the requirement for leases to be classified as operating or finance leases.
The main changes introduced by the new Standard are as follows:
•
recognition of a right-of-use asset and liability for all leases (excluding short-term leases with less than 12 months of tenure and leases relating
to low-value assets);
•
•
•
•
depreciation of right-of-use assets in line with AASB 116: Property, Plant and Equipment in profit or loss and unwinding of the liability in principal
and interest components;
inclusion of variable lease payments that depend on an index or a rate in the initial measurement of the lease liability using the index or rate
at the commencement date;
application of a practical expedient to permit a lessee to elect not to separate non-lease components and instead account for all components
as a lease; and
inclusion of additional disclosure requirements.
The transitional provisions of AASB 16 allow a lessee to either retrospectively apply the Standard to comparatives in line with AASB 108 or recognise
the cumulative effect of retrospective application as an adjustment to opening equity on the date of initial application. The group has assessed the
impact of these changes and based on the operating leases currently held (refer note 23) does not have a material impact.
1.6.
Comparative Figures
Certain comparative figures have been adjusted to conform to changes in presentation for the current financial year.
1.7.
Critical Accounting Judgements and Estimates
The preparation of the Consolidated Financial Statements requires Directors to make judgements and estimates and form assumptions that affect
how certain assets, liabilities, revenue, expenses and equity are reported. At each reporting period, the Directors evaluate their judgements and
estimates based on historical experience and on other various factors they believe to be reasonable under the circumstances, the results of which
form the basis of the carrying values of assets and liabilities (that are not readily apparent from other sources, such as independent valuations).
Actual results may differ from these estimates under different assumptions and conditions.
Exploration and evaluation expenditure
The Consolidated Entity’s accounting policy for exploration and evaluation expenditure being capitalised include the Daris Project where these costs
are expected to be recoverable through the successful development of the area or where activities in the area have not yet reached a stage that
permits reasonable assessment of the existence or otherwise of economically recoverable reserves. In the case of the Al Hadeetha project, a maiden
reserve announcement was issued in December 2016. This policy requires management to make certain estimates to future events and
circumstances, in particular whether an economically viable extraction operation can be established. Any such estimates and assumptions may
change as new information becomes available. If, after having capitalised the expenditure under the policy, a judgement is made that recovery of the
expenditure is not possible, the relevant capitalised amount will be written off to the statement of profit or loss and other comprehensive income.
Impairment of Mine Development Expenditure
The future recoverability of capitalised mine development expenditure is dependent on a number of factors, including the level of proved and probable
reserves and measured, indicated and inferred mineral resources, future technological changes which could impact the cost of mining, future legal
changes and changes to commodity prices.
To the extent that capitalised mine development expenditure is determined not to be recoverable in the future, this will reduce profits and net assets
in the period in which this determination is made.
54
for the year ended 30 June 2020
Share-based payments transactions
The Consolidated Entity measures the cost of equity-settled transactions with Directors and employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined using a Black-Scholes options valuation model, taking into account
the terms and conditions upon which the instruments were granted. The related assumptions are detailed in Note 20. The accounting estimates have
no impact on the carrying amounts of assets and liabilities but will impact expenses and equity.
1.8.
New, Revised or Amending Accounting Standards and Interpretations Adopted
The Consolidated Entity has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by the Australian
Accounting Standards Board (AASB) that are mandatory for the current reporting period. The adoption of these Accounting Standards and
Interpretations did not have any significant impact on the financial performance or position of the Consolidated Entity during the financial year.
Any new, revised or amending Accounting Standards or Interpretations that are not yet mandatory have not been early adopted. The adoption of
AASB 16 did not have a material impact on the Group.
1.9.
New Accounting Standards and Interpretations not yet Mandatory or Early Adopted
There are no forthcoming standards and amendments that are expected to have a material impact on the group in the current or future reporting
periods, or on foreseeable future transactions.
2.
PARENT ENTITY INFORMATION
The following information provided relates to the Company, Alara Resources Limited, as at 30 June 2020.
Statement of Financial Position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Issued capital
Options Reserve
Accumulated losses
Total equity
Revenue
Interest
Other income
Unrealised Forex Gain
ACCOUNTING POLICY NOTE
Revenue Recognition
Profit/(loss) for the year
Other comprehensive income for the year
Total comprehensive income /(loss) for the year
3.
PROFIT/(LOSS) FOR THE YEAR
The operating profit before income tax includes the following items of revenue and expense:
2019
$
1,041,564
8,889,397
88,568
36,264
2020
$
776,427
8,941,193
30,486
-
-
9,717,620
9,930,961
30,486 124,832
9,687,134
9,806,129
66,340,322
66,107,404
(56,653,188)
20,000
(56,321,275)
9,687,134
9,806,129
(331,913)
(342,271)
-
-
(331,913)
(342,271)
2020
$
164,901
(5,304)
2019
$
165,848
-
477,951
97,401
637,548
263,249
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Consolidated Entity and the revenue can be reliably
measured. All revenue is stated net of the amount of goods and services tax (GST) except where the amount of GST incurred is not recoverable from
the Australian Tax Office. The following specific recognition criteria must also be met before revenue is recognised:
Interest Revenue – Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial
•
•
assets.
Other Revenues – Other revenues are recognised on a receipts basis.
Alara Resources Annual Report 2020
for the year ended 30 June 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
Share-based payments transactions
The Consolidated Entity measures the cost of equity-settled transactions with Directors and employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined using a Black-Scholes options valuation model, taking into account
the terms and conditions upon which the instruments were granted. The related assumptions are detailed in Note 20. The accounting estimates have
no impact on the carrying amounts of assets and liabilities but will impact expenses and equity.
1.8.
New, Revised or Amending Accounting Standards and Interpretations Adopted
The Consolidated Entity has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by the Australian
Accounting Standards Board (AASB) that are mandatory for the current reporting period. The adoption of these Accounting Standards and
Interpretations did not have any significant impact on the financial performance or position of the Consolidated Entity during the financial year.
Any new, revised or amending Accounting Standards or Interpretations that are not yet mandatory have not been early adopted. The adoption of
AASB 16 did not have a material impact on the Group.
1.9.
New Accounting Standards and Interpretations not yet Mandatory or Early Adopted
There are no forthcoming standards and amendments that are expected to have a material impact on the group in the current or future reporting
periods, or on foreseeable future transactions.
2.
PARENT ENTITY INFORMATION
The following information provided relates to the Company, Alara Resources Limited, as at 30 June 2020.
Statement of Financial Position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Issued capital
Options Reserve
Accumulated losses
Total equity
Profit/(loss) for the year
Other comprehensive income for the year
Total comprehensive income /(loss) for the year
3.
PROFIT/(LOSS) FOR THE YEAR
The operating profit before income tax includes the following items of revenue and expense:
Revenue
Interest
Other income
Unrealised Forex Gain
2020
$
2019
$
776,427
8,941,193
9,717,620
1,041,564
8,889,397
9,930,961
30,486
-
88,568
36,264
30,486 124,832
9,687,134
9,806,129
66,340,322
-
(56,653,188)
66,107,404
20,000
(56,321,275)
9,687,134
9,806,129
(331,913)
(342,271)
-
-
(331,913)
(342,271)
2020
$
2019
$
477,951
164,901
(5,304)
637,548
97,401
165,848
-
263,249
ACCOUNTING POLICY NOTE
Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Consolidated Entity and the revenue can be reliably
measured. All revenue is stated net of the amount of goods and services tax (GST) except where the amount of GST incurred is not recoverable from
the Australian Tax Office. The following specific recognition criteria must also be met before revenue is recognised:
•
Interest Revenue – Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial
assets.
•
Other Revenues – Other revenues are recognised on a receipts basis.
55
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
4.
INCOME TAX EXPENSE
The major components of tax expense and the reconciliation of the expected tax
expense based on the domestic effective tax rate of 2020 at 27.5% (2019: 27.5%)
and the reported tax expense in profit or loss are as follows:
Tax expense comprises:
(a) Current tax
Deferred income tax relating to origination and reversal of temporary differences
- Origination and reversal of temporary differences
- Utilisation of unused tax losses previously unrecognised
Under/(Over) provision in respect of prior years
Tax expense
Deferred Tax Expense (income), recognised directly in other comprehensive income
(b) Accounting profit before tax
Income Tax Expense to Accounting Profit:
Tax at the Australian tax rate of 27.5% (2018: 27.5%)
Assessable amounts
Deductible amounts
Non-assessable income - Other
Non-deductible items
Utilisation of unused tax losses previously unrecognised
Deferred tax assets recognised/ (not recognised)
Tax rate difference
Income tax expenses (benefit)
(c) Recognised Deferred Tax Balances
Deferred tax asset
Deferred tax asset (losses)
Set-off deferred tax liabilities
(d) Deductible temporary differences, unused tax losses and unused tax credits
for which no deferred tax assets have been recognised are attributable to the
following:
Unrecognised deferred tax asset losses
Unrecognised deferred tax asset losses (capital)
Unrecognised deferred tax asset Oman losses
2020
$
2019
$
4. Income Tax Expense (Continued)
for the year ended 30 June 2020
-
-
-
-
-
(14,966)
(4,116)
49,437
-
(11,113)
71,197
(61,270)
(29,082)
(15,053)
-
1,009
98,546
(99,555)
-
1,525,220
450,990
218,624
2,194,834
-
-
-
-
-
(319,119)
(87,758)
-
-
(20,165)
23,996
(83,178)
78,122
88,983
-
17,349
82,885
(100,234)
-
1,630,322
450,990
362,008
2,443,320
deductible and taxable temporary differences to measure the deferred tax asset or liability. An exception is made for certain temporary differences
arising from the initial recognition of an asset or a liability. No deferred tax asset or liability is recognised in relation to these temporary differences if
they arose in a transaction, other than a business combination, that at the time of the transaction did not affect either accounting profit or taxable
profit or loss. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable
amounts will be available to utilise those temporary differences and losses. The amount of deferred tax assets benefits brought to account or which
may be realised in the future, is based on the assumption that no adverse change will occur in income taxation legislation and the anticipation that
the Consolidated Entity will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of
deductibility imposed by the law. Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and
tax bases of investments in controlled entities where the Company is able to control the timing of the reversal of the temporary differences and it is
probable that the differences will not reverse in the foreseeable future. Deferred tax assets and liabilities are offset when there is a legally enforceable
right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax
liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and
settle the liability simultaneously. Current and deferred tax balances attributable to amounts recognised directly in other comprehensive income or
equity are also recognised directly in other comprehensive income or equity.
Tax consolidation legislation
The Consolidated Entity implemented the tax consolidation legislation. The head entity, Alara Resources Limited, and the controlled entities in the
tax consolidated group continue to account for their own current and deferred tax amounts. These tax amounts are measured as if each entity in the
tax consolidated group continues to be a stand-alone taxpayer in its own right. In addition to its own current and deferred tax amounts, the Company
also recognises the current tax liabilities (or assets) and the deferred tax assets (as appropriate) arising from unused tax losses and unused tax
credits assumed from controlled entities in the tax consolidated group. Assets or liabilities arising under tax funding agreements within the tax
consolidated entities are recognised as amounts receivable from or payable to other entities in the Consolidated Entity. Any differences between the
amounts assumed and amounts receivable or payable under the tax funding agreement are recognised as a contribution to (or distribution from)
wholly-owned tax consolidated entities.
Goods and Services Tax (GST)
5.
AUDITOR’S REMUNERATION
non-audit related firms:
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the
Australian Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense.
Receivables and payables in the statement of financial position are shown inclusive of GST. Cash flows are presented in the cash flow statement on
a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.
During the year the following fees were paid or payable for services provided by the auditors to the Consolidated Entity, their related practices and
Bentleys Audit and Corporate (WA) Pty Ltd
Rothsay Consulting services – Auditors of the Consolidated Entity
(Audit and review of financial reports)
RSM Chartered Accountants – Auditors of Oman-controlled entities
(Audit and review of financial reports)
[The remainder of this page is intentionally blank]
2020
$
3,845
22,000
5,987
2019
$
31,000
-
5,072
31,832
36,072
The benefit of the deferred tax assets not recognised will only be obtained if:
(i)
The Consolidated Entity derives future income that is assessable for Australian income tax purposes and is of a type and an amount sufficient
to enable the benefit of them to be realised;
The Consolidated Entity continues to comply with the conditions for deductibility imposed by tax legislation in Australia; and
There are no changes in tax law which will adversely affect the Consolidated Entity in realising the benefit of them.
(ii)
(iii)
The Consolidated Entity has elected to consolidate for taxation purposes and has entered into a tax sharing and funding agreement in respect of
such arrangements.
ACCOUNTING POLICY NOTE
Income Tax
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the notional income tax rate
for each taxing jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences between the tax bases of
assets and liabilities and their carrying amounts in the financial statements, and to unused tax losses (if applicable). Deferred tax assets and liabilities
are recognised for temporary differences at the tax rates expected to apply when the assets are recovered or liabilities are settled, based on those
tax rates which are enacted or substantively enacted for each taxing jurisdiction. The relevant tax rates are applied to the cumulative amounts of
56
Alara Resources Annual Report 2020
for the year ended 30 June 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
4. Income Tax Expense (Continued)
deductible and taxable temporary differences to measure the deferred tax asset or liability. An exception is made for certain temporary differences
arising from the initial recognition of an asset or a liability. No deferred tax asset or liability is recognised in relation to these temporary differences if
they arose in a transaction, other than a business combination, that at the time of the transaction did not affect either accounting profit or taxable
profit or loss. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable
amounts will be available to utilise those temporary differences and losses. The amount of deferred tax assets benefits brought to account or which
may be realised in the future, is based on the assumption that no adverse change will occur in income taxation legislation and the anticipation that
the Consolidated Entity will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of
deductibility imposed by the law. Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and
tax bases of investments in controlled entities where the Company is able to control the timing of the reversal of the temporary differences and it is
probable that the differences will not reverse in the foreseeable future. Deferred tax assets and liabilities are offset when there is a legally enforceable
right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax
liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and
settle the liability simultaneously. Current and deferred tax balances attributable to amounts recognised directly in other comprehensive income or
equity are also recognised directly in other comprehensive income or equity.
Tax consolidation legislation
The Consolidated Entity implemented the tax consolidation legislation. The head entity, Alara Resources Limited, and the controlled entities in the
tax consolidated group continue to account for their own current and deferred tax amounts. These tax amounts are measured as if each entity in the
tax consolidated group continues to be a stand-alone taxpayer in its own right. In addition to its own current and deferred tax amounts, the Company
also recognises the current tax liabilities (or assets) and the deferred tax assets (as appropriate) arising from unused tax losses and unused tax
credits assumed from controlled entities in the tax consolidated group. Assets or liabilities arising under tax funding agreements within the tax
consolidated entities are recognised as amounts receivable from or payable to other entities in the Consolidated Entity. Any differences between the
amounts assumed and amounts receivable or payable under the tax funding agreement are recognised as a contribution to (or distribution from)
wholly-owned tax consolidated entities.
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the
Australian Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense.
Receivables and payables in the statement of financial position are shown inclusive of GST. Cash flows are presented in the cash flow statement on
a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.
5.
AUDITOR’S REMUNERATION
During the year the following fees were paid or payable for services provided by the auditors to the Consolidated Entity, their related practices and
non-audit related firms:
Bentleys Audit and Corporate (WA) Pty Ltd
Rothsay Consulting services – Auditors of the Consolidated Entity
(Audit and review of financial reports)
RSM Chartered Accountants – Auditors of Oman-controlled entities
(Audit and review of financial reports)
[The remainder of this page is intentionally blank]
2020
$
3,845
22,000
5,987
2019
$
31,000
-
5,072
31,832
36,072
57
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
6.
EARNINGS/(LOSS) PER SHARE
Basic earnings/(loss) per share cents
Diluted earnings/(loss) per share cents
Profit/(loss) $ used to calculate earnings/(loss) per share
2020
$
0.04
0.04
273,985
2019
$
(0.07)
(0.07)
(454,577)
Weighted average number of ordinary shares during the period used in calculation of
basic earnings/(loss) per share
Weighted average number of ordinary shares during the period used in calculation of
diluted earnings/(loss) per share
629,835,362
629,017,589
629,835,362
629,017,589
Under AASB 133 "Earnings per share", potential ordinary shares such as options will only be treated as dilutive when their conversion to ordinary
shares would increase loss per share from continuing operations.
ACCOUNTING POLICY NOTE
Basic Earnings per share is determined by dividing the operating result after income tax by the weighted average number of ordinary shares on issue
during the financial period. Diluted Earnings per share adjusts the figures used in the determination of basic earnings per share by taking into account
amounts unpaid on ordinary shares and any reduction in earnings per share that will probably arise from the exercise of options outstanding during
the financial period.
7.
CASH AND CASH EQUIVALENTS
Cash in hand
Cash at bank
Term deposits
2020
$
239
7,467,091
207,286
2019
$
31
7,050,778
511,598
7,674,616
7,562,407
The effective interest rate on short-term bank deposits was 1.15% (2019: 2.35%) with an average maturity of 91 days.
(a) Risk exposure
The Consolidated Entity’s exposure to interest rate and foreign exchange risk is discussed in Note 22. The maximum exposure to credit risk at the
end of the reporting period is the carrying amount of each class of cash and cash equivalents mentioned above.
ACCOUNTING POLICY NOTE
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments and bank overdrafts.
Bank overdrafts (if any) are shown within short-term borrowings in current liabilities on the statement of financial position.
(b) Reconciliation of Net Profit/(Loss) after Tax to Net Cash Flow
From Operations
Profit/(Loss) after income tax
Gain/(Loss) on Forex (Unrealised)
Profit on sale of asset
Gain/(loss) on disposal of Subsidiary
Share of profits/(losses) of associates and joint ventures
Foreign exchange movement
Depreciation
(Increase)/Decrease in Assets:
Trade and other receivables
Other current assets
Increase/(Decrease) in Liabilities:
Payable to AHI
Trade and other payables
Provisions
Statdrome Advance paid
Net cashflows from/ (used in) operating activities
58
2020
$
(14,966)
-
-
-
(30,412)
(273,130)
9,575
3,087
80,914
-
40,179
(292,961)
(22,898)
(1,615,565)
(2,116,177)
2019
$
(319,119)
-
(207)
(425,895)
52,027
12,038
10,118
(74,927)
(102,864)
-
-
100,884
(28,611)
-
(776,556)
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
8.
TRADE AND OTHER RECEIVABLES
Current
Amounts receivable from:
Sundry debtors
Goods and services tax recoverable
Cash advances
2020
$
25,476
5,157
-
2019
$
79,877
4,998
2,948
30,633 87,823
(a) Risk exposure
Information about the Consolidated Entity's exposure to credit risk, foreign exchange risk and interest rate risk is in Note 22.
(b) Impaired receivables
None of the above receivables are impaired or past due.
ACCOUNTING POLICY NOTE
Trade and other receivables are recorded at amounts due less any provision for doubtful debts. An estimate for doubtful debts is made when collection
of the full amount is no longer probable. Bad debts are written off when considered non-recoverable.
9.
OTHER CURRENT ASSETS
Prepayments
Accrued interest
10.
FINANCIAL ASSETS
Current
Bank deposits
Non-Current
Interest free loan to Alara Resources LLC
11.
INVESTMENT IN ASSOCIATES
The movement for the year in the Group’s investments accounted for using the equity method is as follows:
Opening balance
Investment in Alara Resources LLC
Profit /(Loss) from equity accounted investments
Subtotal
2020
$
377,224
354
2019
$
58,753
70,726
377,578 129,479
2020
$
2019
$
8,661 4,696,887
422,342
431,003 5,314,554
617,667
2020
$
2019
$
162,415
-
30,412
192,827 162,415
-
214,442
(52,027)
ACCOUNTING POLICY NOTE
An associate is an entity over which the group has significant influence and that is neither a subsidiary nor an interest in a joint venture. Significant
influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies.
Under the equity method, an investment in an associate is recognized initially in the consolidated statement of financial position at cost and adjusted
thereafter to recognize the group’s share of the profit or loss and other comprehensive income of the associate. When the group’s share of losses of
an associate exceeds the Group’s interest in that associate, the group discontinues recognising its share of further losses. Additional losses are
recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate.
59
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
12.
PROPERTY, PLANT AND EQUIPMENT
Year ended 30 June 2019
Carrying amount at beginning
Reclassified from Exploration Expenditure
(Note 13)
Additions
Disposal
Write-offs
Depreciation expense
Exchange Difference
Closing amount at reporting date
Year ended 30 June 2019
Cost or fair value
Accumulated depreciation
Net carrying amount
Year ended 30 June 2020
Carrying amount at beginning
Additions
Disposal
Write-offs
Depreciation expense
Exchange Difference
Closing amount at reporting date
Year ended 30 June 2020
Cost or fair value
Accumulated depreciation
Net carrying amount
Motor
Vehicles
Office
Equipment
Plant and
Equipment
$
$
$
Mine Properties
& Development
assets
$
Total
$
19,043
-
-
-
-
(2,951)
913
17,005
29,483
(12,478)
17,005
17,005
-
-
(2,674)
437
14,768
30,125
(15,357)
14,768
23,059
-
5,805
(1,070)
-
(6,582)
85
21,297
1,701
-
-
-
-
(585)
76
1,192
170,278
(148,981)
21,297
23,051
(21,859)
1,192
21,297
9,146
(6,485)
272
24,230
1,192
-
-
-
(416)
36
812
179,954
(155,724)
24,230
23,552
(22,740)
812
-
43,803
5,672,100
568,551
-
-
-
293,437
6,534,088
6,534,088
-
6,534,088
6,534,088
3,250,026
-
-
-
142,037
9,926,151
9,926,151
-
9,926,151
5,672,100
574,356
(1,070)
-
(10,118)
294,511
6,573,582
6,756,900
(183,318)
6,573,582
6,573,582
3,259,172
-
-
(9,575)
142,782
9,965,961
10,159,782
(193,821)
9,965,961
ACCOUNTING POLICY NOTE
All plant and equipment are stated at historical cost less accumulated depreciation and impairment losses. Historical cost includes expenditure that
is directly attributable to the acquisition of the items. The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not
in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be
received from the assets employment and subsequent disposal. The expected net cash flows have been discounted to their present value in
determining recoverable amount. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits associated with the item will flow to the Consolidated Entity and the cost of the item can be
measured reliably. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred. The
depreciable amount of all fixed assets is depreciated on a diminishing value basis over the asset's useful life to the Consolidated Entity commencing
from the time the asset is held ready for use. The depreciation rates used for each class of depreciable assets are:
Class of Fixed Asset
Office Equipment
Motor Vehicles
Plant and Equipment
Depreciation Rate
15 – 37.5%
33.3%
15 – 33.3%
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date. An asset’s carrying amount is written
down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on
disposals are determined by comparing proceeds with carrying amount. These are included in the statement of profit or loss and other comprehensive
income. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained earnings.
Mine properties and development assets
Mine property and development assets include costs incurred in accessing the ore body and costs to develop the mine to the production phase, once
the technical feasibility and commercial viability of a mining operation has been established. At this stage, exploration and evaluation assets are
reclassified to mine properties. Mine property and development assets are stated at historical cost less accumulated amortisation and any
accumulated impairment losses recognised. The initial cost of an asset comprises its purchase price or construction cost and any costs directly
attributable to bringing the asset into operation. Any ongoing costs associated with mining which are considered to benefit mining operations in future
periods are capitalised.
60
Alara Resources Annual Report 2020
for the year ended 30 June 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
13.
EXPLORATION AND EVALUATION
Opening balance
- Exploration and evaluation expenditure
- Exchange differences
Reclassification of Al Hadeetha Project to Development Expenditure (Note 12)
Closing balance
2020
$
4,919,660
107,644
134,572
-
5,161,876
2019
$
9,415,666
943,723
232,371
(5,672,100)
4,919,660
During the prior year, the Al Hadeetha Copper-Gold Project in Oman has been reclassified to Development Expenditure upon demonstrating
commercial viability and commencement of development activities.
On 21 October 2010, Alara Saudi Operations Pty Limited, a wholly owned subsidiary of the Company, entered into a shareholders’ agreement with
mineral licences holder, United Arabian Mining LLC (Manajem). Pursuant to the shareholders’ agreement a joint venture entity, Khnaiguiyah Mining
Company LLC (KMC) (in which the Consolidated Entity has a 50% shareholding interest) was established and Manajem are required to transfer legal
title to the mining licence and exploration licences over the Khnaiguiyah Project to KMC. The Consolidated Entity has obtained independent advice
confirming that valid and legally enforceable rights existed for KMC to commercially exploit the Khnaiguiyah Project. The financial statements of
previous Annual Reports were prepared on this basis with the asset carried at $33,190,221 as at 30 June 2015. Following cancellation of the
Khnaiguiyah Mining Licence, a provision for impairment of the carrying value of exploration and evaluation attributable to the Khnaiguiyah Project
was made. This provision for impairment may be reversed in the future(see accounting policy note on mineral exploration and evaluation expenditure
below).
Alara Oman Operations Pty Limited (a wholly owned Australian subsidiary) gained a 70% shareholding interest in a jointly controlled company, Al
Hadeetha Resource LLC (Oman), on 23 November 2011. Further on 24 December 2018 the Group disposed of a 19% interest in Al Hadeetha
Resources LLC to Al Tasnim Infrastructure Services LLC, reducing its continuing interest to 51%. The principal activity of the company is exploration,
evaluation and development of mineral licences in Oman.
Alara Oman Operations Pty Limited (a wholly owned Australian subsidiary) gained a 50% shareholding interest in a jointly controlled company, Daris
Resources LLC (Oman), on 1 December 2010. The principal activity of this company is exploration, evaluation and development of mineral licences
in Oman. The Consolidated Entity has a valid and legally enforceable contractual right to commercially exploit the Daris Project held by Daris
Resources LLC (in which the Consolidated Entity has a 50% shareholding interest) and does not hold the legal title to the mineral exploration licence
(which is held by the other 50% shareholder of Daris Resources LLC). The financial statements have been prepared on this basis (refer Note 21 for
further disclosures). Should these legal rights not be enforceable, the carrying value of Exploration and Evaluation Expenditure attributable to the
Daris Project would be impaired.
The Consolidated Group has entered in to a Heads of Agreement with Copper LLC, under which wholly owned subsidiary Alara Oman Operations
Pty Ltd would become a 10% shareholder in the Awtad Block 8 Project. As part of the Heads of Agreement, Awtad acknowledges OMR 246,215
(AUD 812,316) previously spent on the project by Alara as the basis for Alara’s interest in that project.
ACCOUNTING POLICY NOTE
Mineral Exploration and Evaluation Expenditure
Exploration, evaluation and development expenditure incurred is accumulated (i.e. capitalised) in respect of each identifiable area of interest. These
costs are only carried forward where they are expected to be recoverable through the successful development of the area or where activities in the
area and includes areas that have not yet reached a stage that permits reasonable assessment of the existence or otherwise of economically
recoverable reserves. Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which the decision to
abandon the area is made. Exploration and evaluation expenditure is written-off when it fails to meet at least one of the conditions outlined above or
an area of interest is abandoned. Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the
carrying amount of an exploration and evaluation asset may exceed its recoverable amount. When facts and circumstances suggest that the carrying
amount exceeds the recoverable amount, the impairment loss will be measured in accordance with the Consolidated Entity’s impairment policy (Note
1.7). This policy requires management to make certain estimates to future events and circumstances, in particular whether an economically viable
extraction operation can be established. Any such estimates and assumptions may change as new information becomes available. If, after having
capitalised the expenditure under the policy, a judgement is made that recovery of the expenditure is not possible, the relevant capitalised amount
will be written off to the statement of profit or loss and other comprehensive income.
Impairment of Non-Financial Assets
At each reporting date, the Consolidated Entity reviews the carrying values of its tangible and intangible assets to determine whether there is any
indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair
value less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable
amount is expensed to the profit or loss. Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.
The remainder of this page is intentionally blank]
61
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
14.
TRADE AND OTHER PAYABLES
Current
Trade payables
Other payables
2020
$
267,424
310
267,734
2019
$
508,225
116,199
624,424
Due to the short-term nature of the trade and other payables, their carrying value is assumed to approximate their fair value.
15.
UNEARNED INCOME
Current
Unearned income
2020
$
2019
$
8,817
8,817
1,624,382
1,624,382
On 15 March 2017 Alara Oman Operations Pty Ltd (a wholly owned subsidiary of the Company) entered into an off-take agreement for the supply of
copper concentrate from the Al Hadeetha Project to Statdrome Pte Ltd (Offtake Agreement). Under the Offtake Agreement, concentrate production
from the Al Hadeetha Copper Project (Washihi Mazzaza site) will be shipped from the Sohar port (unless a smelter is operating in Oman). In June
2018 Statdrome made a pre-payment under the Offtake Agreement. The Statdrome advance bears interest at LIBOR plus four percent per annum.
This amount represents unearned income. The amount of this liability in AUD is shown in the table above. On 03.05.2020, the advance received have
been repaid to Statdrome.
(a) Risk exposure
Details of the Consolidated Entity's exposure to risks arising from current payables are set out in Note 22.
ACCOUNTING POLICY NOTE
These amounts represent liabilities for goods and services provided to the Consolidated Entity prior to the end of financial year which are unpaid.
The amounts are unsecured and are usually paid within 30 days of recognition.
16.
PROVISIONS
Current
Employee benefits – annual leave
Non-Current
Employee benefits – long service leave
2020
$
21,755
-
21,755
2019
$
8,390
36,264
44,654
Amounts not expected to be settled within the next 12 months
The entire annual leave obligation is presented as current as the Consolidated Entity does not have an unconditional right to defer settlement. The
non-current provision for long service leave is a provision towards the future entitlements of employees who will have completed the required period
of long service and that is not expected to be taken or paid within the next 12 months.
ACCOUNTING POLICY NOTE
Employee Benefits
(i) Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled within 12 months after the end of the
period in which the employees render the related service are recognised in respect of employees' services up to the end of the reporting period and
are measured at the amounts expected to be paid when the liabilities are settled. The liability for annual leave is recognised in other payables and
accruals together with other employee benefit obligations.
(ii) Other long-term employee benefit obligations
The liability for long service leave and annual leave which is expected to be settled within 12 months after the end of the period in which the employee
renders the related service is recognised in the provision for employee benefits and measured as the present value of expected future payments to
be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. Consideration is
given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted
using market yields at the end of the reporting period on national government bonds with terms to maturity and currency that match, as closely as
possible, the estimated future cash outflows. The obligations are presented as current liabilities in the balance sheet if the entity does not have an
unconditional right to defer settlement for at least twelve months after the reporting date, regardless of when the actual settlement is expected to
occur.
62
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
17.
FINANCIAL LIABILITIES
Financial liabilities
Opening balance
Add: Interest
Add: Foreign exchange differences
Closing balance
2020
$
644,232
26,175
14,004
2019
$
583,756
30,184
30,292
684,411 644,232
(i)
On 16 April 2017, Al Hadeetha Resources LLC (AHR) (the joint venture company which conducts the Al Hadeetha Copper-Gold Project
(Project), in which the Company is a 51% shareholder) entered into an unsecured loan agreement as borrower with Al Hadeetha Investments
LLC (Lender) (an un-related company, which holds the remaining 30% of the shares in AHR). Under the agreement, AHR may draw down
a maximum of USD 2 million (AUD 2,914,160; OMR 773,887) to assist with working capital for the Project (AHI to AHR Loan). The AHI to
AHR Loan bears interest at LIBOR plus two percent per annum. The Loan will be in effect for the duration of the Project joint venture
agreement, at which time AHR must repay any outstanding balance. AHR must make interim repayments equal to its available net cash
profit (if any) at the end of each financial year. During the year AHR has not made any drawdowns under the Loan. The total amount drawn
down (being the total amount owing by AHR under the Loan to the end of the year is OMR 181,753 (USD 469,711; AUD 684,411). If AHR
determines at the end of any quarter or other period that it has a working capital shortfall it may draw down the whole or part of the shortfall,
until the entire Loan amount is drawn down. The remaining, un-drawn balance of the Loan is OMR 592,134 (USD 1,530,289; AUD 2,229,749).
Although the AHI to AHR Loan is shown as a liability in the consolidated financial statements, loans by entities within the Alara Consolidated
Entity to AHR, which is also within that Consolidated Entity (Consolidated Entity AHR Loans) are not shown in the consolidated financial
statements. The Consolidated Entity AHR Loans total $A19.2 million and are subject to the same loan terms as the AHI to AHR Loan. The
Consolidated Entity AHR Loans are repayable on the same basis as the AHI to AHR Loan. Therefore, if AHR makes a loan repayment to
AHI, AHR will also be required to make a loan repayment to its lenders within the Alara Consolidated Group on a pro-rata basis.
[The remainder of this page is intentionally blank]
63
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
18.
ISSUED CAPITAL
Fully paid ordinary shares
2020
№
2019
№
634,886,315 629,017,589
2020
$
66,340,323
2019
$
66,107,405
2019
Balance as at 1 July 2018
- Share movement during the 2019 financial year
- Share issue costs during the 2019 financial year
Balance as at 30 June 2019
2020
Balance as at 1 July 2019
- Share movement during the 2020 financial year
- Share issue costs during the 2020 financial year
Balance as at 30 June 2020
№
629,017,589
-
-
629,017,589
№
629,017,589
5,868,726
-
634,886,315
$
66,107,405
-
-
66,107,405
$
66,107,405
232,918
-
66,340,323
Each fully paid ordinary share carries one vote per share and the right to participate in dividends. Ordinary shares have no par value and the Company
does not have a limit on the amount of its capital.
Capital risk management
The Consolidated Entity's objective when managing its capital is to safeguard its ability to continue as a going concern, so that it can continue to
provide returns for shareholders and benefits for other stakeholders and to maintain a capital structure balancing the interests of all shareholders.
The Board will consider capital management initiatives as is appropriate and in the best interests of the Consolidated Entity and shareholders from
time to time. The Consolidated Entity had no external borrowings as at 30 June 2020, other than as disclosed in Note 17. The Consolidated Entity's
non-cash investments can be realised to meet accounts payable arising in the normal course of business.
Accounting Policy Note
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a
deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options, or for the acquisition of a
business, are included in the cost of the acquisition as part of the purchase consideration.
19.
RESERVES
Foreign currency translation reserve
Options reserve
Transactions with minority interests
2020
$
2,468,811
-
8,593,853
11,062,664
2019
$
1,627,214
20,000
8,593,853
10,241,067
Foreign currency translation reserve
Exchange differences arising on translation of a foreign controlled entity's financial results and position are taken to the foreign currency translation
reserve. The reserve is de-recognised when the investment is disposed of.
Options reserve
The number of unlisted options outstanding over unissued ordinary shares at the reporting date is as follows:
Employees’ Options
Unlisted options exercisable at $0.04; expired 9 March 2020
Grant date
Number of
options
2020
$
2019
$
-
-
-
-
20,000
20,000
The Option Reserve records the consideration (net of expenses) received by the Company on the issue of listed options and the fair value of unlisted
Employees' options that were issued for nil consideration.
64
Alara Resources Annual Report 2020
for the year ended 30 June 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
20.
SHARE-BASED PAYMENTS
There were no shares issued as a result of the exercise of any options during the year (2020: NIL). Also, Share options issued during 2017 have
been lapsed during the year without being exercised.
ACCOUNTING POLICY NOTE
Director/Employee Options
The fair value of options granted by the Company to directors and employees is recognised as an employee benefit expense with a corresponding
increase in equity. The fair value is measured as at grant date and is expensed in full as at their date of issue where they are 100% vested on grant
and otherwise over their vesting period (where applicable). The fair value at grant date is determined using the Black-Scholes valuation model that
takes into account the exercise price, the term of the option, the vesting criteria, the unlisted nature of the option, the share price at grant date and
the expected price volatility of the underlying shares in the Company, and the risk-free interest rate for the term of the option. Upon the exercise of
options, the balance of the reserve relating to those options is transferred to share capital.
21.
SEGMENT INFORMATION
The Board has considered the activities/operations and geographical perspective within the operating results and have determined that the
Consolidated Entity operates in the resource exploration, evaluation and development sector within geographic segments - Australia, Saudi Arabia
and Oman.
2020
Total segment revenues
Total segment loss/(profit)before tax
Total segment assets
Total segment liabilities
2019
Total segment revenues
Total segment loss before tax
Total segment assets
Total segment liabilities
(a) Reconciliation of segment information
(i) Total Segment Assets
Total Assets as per Statement of Financial Position
(ii) Total Segment Revenues
Total Revenue as per Statement of Profit or Loss
and Other Comprehensive Income
(iii) Total Segment profit/(loss) before tax
Total Consolidated Entity profit/(loss) before tax
ACCOUNTING POLICY NOTE
Operating Segments
Australia
$
414,335
3,465,354
2,686,298
(490,495)
193,722
132,680
2,827,297
(124,901)
Oman
$
228,517
(951,327)
21,148,196
(492,222)
Saudi Arabia
$
-
(2,528,993)
-
-
69,527
(462,789)
21,922,623
(2,812,791)
-
10,990
-
-
2020
$
Total
$
642,852
(14,966)
23,834,494
(982,717)
263,249
(319,119)
24,749,920
(2,937,692)
2019
$
23,834,494
24,749,920
642,852
263,249
(14,966)
(319,119)
The Consolidated Entity has applied AASB 8: Operating Segments which requires that segment information be presented on the same basis as that
used for internal reporting purposes. An operating segment is a component of the Consolidated Entity that engages in business activities from which
it may earn revenues and incur expenses. An operating segment's operating results are reviewed regularly by the management to make decisions
on allocation of resources to the relevant segments and assess performance. Unallocated items comprise mainly share investments, corporate and
office expenses.
22.
FINANCIAL RISK MANAGEMENT
The Consolidated Entity's financial instruments mainly consist of deposits with banks, accounts receivable and payable, and investments in a listed
security. The principal activity of the Consolidated Entity is resource exploration, evaluation and development. The main risks arising from the
Consolidated Entity's financial instruments are market (which includes price, interest rate and foreign exchange risks), credit and liquidity risks. Risk
management is carried out by the Board of Directors. The Board evaluates, monitors and manages the Consolidated Entity's financial risk in close
co-operation with its operating units. The financial receivables and payables of the Consolidated Entity in the table below are due or payable within
30 days. The financial investments are held for trading and are realised at the discretion of the Board.
65
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
The Consolidated Entity holds the following financial instruments:
Financial assets
Cash and cash equivalents
Financial instruments (term deposits)
Trade and other receivables
Financial asset
Financial liabilities at amortised cost
Trade and other payables
Financial liabilities
Net Financial Assets
(a) Market Risk
2020
$
7,674,616
8,661
30,633
422,342
8,136,252
(267,734)
(684,411)
(952,145)
7,184,107
2019
$
7,562,407
4,696,887
87,823
617,667
12,964,784
(624,424)
(644,232)
(1,268,656)
11,696,128
(i) Price risk
The Consolidated Entity is exposed to equity securities price risk. This arises from investments held by the Consolidated Entity and classified in
the statement of financial position at fair value through profit or loss. The Consolidated Entity is not directly exposed to commodity price risk. The
value of a financial instrument will fluctuate as a result of changes in market prices, whether those changes are caused by factors specific to the
individual instrument or its issuer or factors affecting all instruments in the market. The Consolidated Entity does not manage this risk through
entering into derivative contracts, futures, options or swaps. Market risk is minimised through ensuring that investment activities are undertaken
in accordance with Board established mandate limits and investment strategies.
(ii) interest rate risk
Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates. The Consolidated Entity's
exposure to market risk for changes in interest rates relate primarily to investments held in interest bearing instruments and its loan from third
parties. The average interest rate applicable to funds held on deposit during the year was 1.15 % (2019: 2.35%).
Cash at bank
Term deposits
Term deposits more than 90 days
Loan with unrelated third parties
2020
$
7,467,091
207,286
8,661
(684,411)
6,998,627
2019
$
7,050,778
511,598
4,696,887
(644,232)
11,615,031
The Consolidated Entity has borrowings subject to interest rate risk. The possible impact on profit or loss or total equity on this exposure is
displayed below:
Loan with unrelated third party
Change in profit
Increase by 1%
Decrease by 1%
Change in equity
Increase by 1%
Decrease by 1%
Revenue
Change in profit
Increase by 3%
Decrease by 3%
Change in equity
Increase by 3%
Decrease by 3%
2020
$
2019
$
(6,844)
6,844
(6,442)
6,442
(6,844)
6,844
(6,442)
6,442
2020
$
2019
$
230,238
(230,238)
226,872
(226,872)
230,238
(230,238)
226,872
(226,872)
66
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
(iii) Foreign exchange risk
The Consolidated Entity is exposed to foreign currency risk in cash held in Omani Riyals (OMR) by the Consolidated Entity's foreign controlled
entity, foreign resource project investment commitments and exploration and evaluation expenditure on foreign exploration and evaluation. The
primary currency giving rise to this risk is Omani Riyals (OMR). The Consolidated Entity has not entered into any forward exchange contracts as
at reporting date and is currently fully exposed to foreign exchange risk. The Consolidated Entity's exposure to foreign currency risk at reporting
date was as follows:
Cash and cash equivalents
Trade and other receivables
Trade and other payables
Non-current financial liabilities
2020
OMR
1,621,512
209,152
(44,068)
(201,753)
1,584,843
2019
OMR
1,820,884
1,146,836
(590,204)
(194,802)
2,182,714
The Consolidated Entity's exposure to foreign exchange risk is mitigated by having comparable asset and liability balances in US dollars.
Therefore, a sensitivity analysis has not been performed. The Consolidated Entity enters into forward exchange contracts with its Australian bank
from time to time to hedge against foreign exchange risk.
(b) Credit risk
Credit risk refers to the risk that a counterparty under a financial instrument will default (in whole or in part) on its contractual obligations resulting in
financial loss to the Consolidated Entity. Concentrations of credit risk are minimised primarily by undertaking appropriate due diligence on potential
investments, carrying out all market transactions through approved brokers, settling non-market transactions with the involvement of suitably qualified
legal and accounting personnel (both internal and external), and obtaining sufficient collateral or other security (where appropriate) as a means of
mitigating the risk of financial loss from defaults. This financial year there was no necessity to obtain collateral.
The credit quality of the financial assets are neither past due nor impaired and can be assessed by reference to external credit ratings (if available
with Standard & Poor's) or to historical information about counterparty default rates. The maximum exposure to credit risk at reporting date is the
carrying amount of the financial assets as summarised below:
Cash and cash equivalents
BB-
No external credit rating available
Trade and other receivables (due within 30 days)
No external credit rating available
2020
$
7,674,377
239
2019
$
7,562,376
31
7,674,616
7,562,407
30,633
87,823
The Consolidated Entity measures credit risk on a fair value basis. The carrying amount of financial assets recorded in the financial statements, net
of any provision for losses, represents the Consolidated Entity’s maximum exposure to credit risk. All receivables noted above are due within 30 days.
None of the above receivables are past due.
[The remainder of this page is intentionally blank]
67
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
(c) Liquidity risk
Liquidity risk is the risk that the Consolidated Entity will encounter difficulty in meeting obligations associated with financial liabilities. There is sufficient
cash and cash equivalents and the non-cash investments can be realised to meet accounts payable arising in the normal course of business. The
financial liabilities maturity obligation is disclosed below:
2020
Financial assets
Cash and cash equivalents
Financial instruments (Term deposits)
Interest free loan to Alara Resources LLC
Trade and other receivables
Financial liabilities
Trade and other payables
Other financial liabilities
Net inflow/(outflow)
2019
Financial assets
Cash and cash equivalents
Financial instruments (Term deposits)
Interest free loan to Alara Resources LLC
Trade and other receivables
Financial liabilities
Trade and other payables
Other financial liabilities
Net inflow/(outflow)
Less than
6 months
$
6-12
months
$
7,674,616
-
30,633
7,705,249
(267,734)
-
(267,734)
7,437,515
-
8,661
-
-
8,661
-
-
-
8,661
1-5
years
$
-
-
422,342
-
422,342
Total
$
7,674,616
8,661
422,342
30,633
8,136,252
-
(684,411)
(684,411)
(262,069)
(267,734)
(684,411)
(952,145)
7,184,107
7,562,407
-
87,823
7,650,230
-
4,696,887
-
-
4,696,887
-
-
617,667
-
617,667
7,562,407
4,696,887
617,667
87,823
12,964,784
(624,424)
-
(624,424)
7,025,806
-
-
-
4,696,887
-
(644,232)
(644,232)
(26,565)
(624,424)
(644,232)
(1,268,656)
11,696,128
(d) Fair Value of Financial Assets and Liabilities
The carrying amount of financial instruments recorded in the financial statements represents their fair value determined in accordance with the
accounting policies disclosed in Note 1. The aggregate fair value and carrying amount of financial assets at reporting date are set out in Notes 7,8
and 10. The financial liabilities at reporting date are set out in Note 14 and 17.
(e) Fair value measurements
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes. The
Consolidated Entity’s financial assets and liabilities approximate their fair values.
ACCOUNTING POLICY NOTE
Financial Instruments
Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions to the instrument. For financial
assets, this is equivalent to the date that the entity commits itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted).
Financial instruments are initially measured at fair value plus transaction costs, except where the instrument is classified ‘at fair value through profit
or loss’, in which case transaction costs are expensed to profit or loss immediately. Subsequent to initial recognition, these instruments are measured
as set out below:
• Financial assets at fair value through profit or loss - A financial asset is classified in this category if acquired principally for the purpose of
selling in the short term or if so designated by management and within the requirements of AASB 139: Recognition and Measurement of Financial
Instruments. Realised and unrealised gains and losses arising from changes in the fair value of these assets are included in the profit or loss in
the period in which they arise.
• Loans and receivables - Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in
an active market and are stated at amortised cost using the effective interest rate method.
• Financial liabilities - Non-derivative financial liabilities are recognised at amortised cost, comprising original debt less principal payments and
amortisation.
Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the fair value for all
unlisted securities, including recent arm’s length transactions, reference to similar instruments and option pricing models. At each reporting date, the
Consolidated Entity assesses whether there is objective evidence that a financial instrument has been impaired. Impairment losses are recognised
68
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
in the profit or loss. The Consolidated Entity’s investment portfolio (comprising listed and unlisted securities) is accounted for as “financial assets at
fair value through profit or loss”.
Fair Value Estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes. The fair value
of financial instruments traded in active markets (such as publicly traded derivatives, and trading and available-for-sale securities) is based on quoted
market prices at the reporting date. The quoted market price used for financial assets held by the Consolidated Entity is the current bid price; the
appropriate quoted market price for financial liabilities is the current ask price. The fair value of financial instruments that are not traded in an active
market (for example over-the-counter derivatives) is determined using valuation techniques, including but not limited to recent arm’s length
transactions, reference to similar instruments and option pricing models. The Consolidated Entity may use a variety of methods and makes
assumptions that are based on market conditions existing at each reporting date. Other techniques, such as estimated discounted cash flows, are
used to determine fair value for other financial instruments.
The nominal value less estimated credit adjustments of trade receivables and payables are assumed to approximate their fair values. The fair value
of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is
available to the Consolidated Entity for similar financial instruments. The Consolidated Entity’s investment portfolio (comprising listed and unlisted
securities) is accounted for as a “financial assets at fair value through profit or loss” and is carried at fair value based on the quoted last bid prices at
reporting date
23. COMMITMENTS
(a) Lease Commitments
Non-cancellable operating lease commitments:
Within 1 year
1-5 years
After 5 years
Total
2020
$
8,376
-
-
8,376
2019
$
28,014
21,434
-
49,448
The Group leases office space under a non-cancellable operating lease. On renewal, the terms of the lease are renegotiated. The Group does not
have an option to purchase the leased asset at the expiry of the lease period.
(b) Capital Commitments
Non-cancellable capital commitments:
Within 1 year
1-5 years
After 5 years
Total
24.
CONTROLLED ENTITIES
Investment in Controlled Entities
Alara Resources Limited (AUQ)
Alara Peru Operations Pty Ltd (APO)
2020
$
-
-
-
-
Controlled
entity
Parent
AUQ
Principal Activity
Exploration
Inactive
Country of
Incorporation
Australia
Australia
Date of
Incorporation
6-Dec-06
9-Mar-07
Alara Saudi Operations Pty Ltd (ASO)
AUQ
Management
Australia
4-Aug-10
Saudi Investments Pty Limited (SIV)
Alara Oman Operations Pty Limited (AOO)
Alara Kingdom Operations Pty Limited (AKO)
Alara Saudi Holdings Pty Limited (ASH)
Al Hadeetha Resources LLC
Alara Resource Ghana Limited
Alara Peru S.A.C
Alara Operations LLC
AUQ
AUQ
AUQ
AUQ
AOO
AUQ
APO
AOO
Australia
Australia
Australia
Australia
Oman
Ghana
Peru
Oman
14-Feb-11
28-Jun-10
5-Sep-11
5-Jun-13
6-Feb-07
8-Dec-09
1-Mar-07
01-Feb-20
Development
Management
Management
Inactive
Exploration /
Development
Inactive
Inactive
Administration
69
2019
$
2,502,279
234,747
-
2,737,026
Jun-19
100%
100%
100%
100%
100%
100%
100%
51%
100%
100%
-
Jun-20
100%
100%
100%
100%
100%
100%
100%
51%
100%
100%
100%
Alara Resources Annual Report 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
for the year ended 30 June 2020
25.
JOINTLY CONTROLLED ENTITIES & INVESTMENTS IN ASSOCIATES
Investment in Jointly Controlled Entities
Daris Resources LLC
Alara Resources LLC
Controlled
entity
AOO
AOO
Principal Activity
Exploration
Mining Services
Country of
Incorporation
Oman
Oman
Date of
Incorporation
1-Dec-10
2-Oct-10
Jun-20
50%
35%
Jun-19
50%
35%
26.
RELATED PARTY TRANSACTIONS
(a) Controlled and Jointly Controlled Entities
Details of the interest in controlled entities and jointly controlled entities are set out in Notes 24 and 25.
(b) Transactions with other related parties
The following transactions occurred with related parties during the year ending 30 June 2020:
(i) Director loan agreement
There was no outstanding directors’ loan during the year.
TRANSACTIONS WITH KEY MANAGEMENT PERSONNEL
Key Management of the Consolidated Entity are each Director and Company Executive being a company secretary or senior managers with authority
and responsibility for planning, directing and controlling the major activities of the Company or Consolidated entity. Details of key management
personnel individual remuneration are disclosed in the remuneration report section of the directors’ report.
Key Management Personnel remuneration includes the following expenses:
Short term employee benefits:
Remuneration including bonuses and allowances
Total short term employee benefits
Long term benefits
Total other long-term benefits
Post-employment benefits:
Defined benefit pension plans
Defined contribution pension plans
Total post-employment benefits
Termination benefits
Share-based payments
Total remuneration
2020
$
1,076,295
1,076,295
59,105
59,105
2019
$
1,001,166
1,001,166
22,806
22,806
-
-
-
-
-
-
-
-
-
-
1,135,400
1,023,972
27.
CONTINGENT ASSETS AND LIABILITIES
Contingent assets and liabilities exist in relation to certain exploration and evaluation of the Consolidated Entity subject to the continued development
and advancement of the same, as described below.
(a)
(b)
Shareholders’ Agreement – Daris Resources LLC – Daris Copper-Gold Project (Oman) – On 28 August 2010, Alara Oman Operations
Pty Limited, a wholly owned subsidiary of the Company, entered into a shareholders’ agreement with Daris Copper Project concession
holder, Al Tamman Trading Establishment LLC (ATTE) pursuant to which Alara will invest up to a total of US$7 million into a new joint
venture company (“Daris Resources LLC” (DarisCo)) to gain up to a 70% shareholding. DarisCo was incorporated in Oman on 1 December
2010 (Alara 50%: ATTE 50%). To the extent that further funding is required, Alara is entitled to advance up to US$4 million to DarisCo as a
loan (on commercial terms and repayable as a priority before distribution of dividends) - convertible into equity in DarisCo to take Alara’s
interest to 70%. DarisCo has exclusive rights (to be further formalised under a management agreement with ATTE) to manage, operate and
commercially exploit the concession. DarisCo is governed by a 6-member board of directors with 3 nominees (including the Chairman) from
Alara and 3 nominees from ATTE.
Shareholders’ Agreement – Alara Resources LLC (Oman) – On 8 August 2010, Alara Oman Operations Pty Limited, a wholly owned
subsidiary of the Company, entered into a shareholders’ agreement with Sur United International Co. LLC (SUR) pursuant to which a new
joint venture company (“Alara Resources LLC” (AlaraCo)) was established to identify, secure and commercially exploit other exploration and
evaluation in Oman introduced to AlaraCo by SUR. AlaraCo was incorporated in Oman on 2 October 2010. Alara contributed 100% of the
initial capital of 150,000 Omani Rials (RO) (equivalent to ~A$425,000 at that time) for its 70% shareholding interest in AlaraCo with SUR
then holding the balance of 30%. Alara transferred a 35% shareholding in AlaraCo to South West Pinnacle Exploration Ltd in 2018. In
January 2019 SUR transferred its 30% shareholding in AlaraCo to Al Tasnim Infrastructure Services LLC. AlaraCo now conducts the
business of drilling and exploration services under a joint venture agreement between its shareholders.
70
Alara Resources Annual Report 2020
for the year ended 30 June 2020
Notes to the Consolidated Financial Statement
for the year ended 30 June 2020
(c)
(d)
(e)
Shareholders’ Agreement – Al Hadeetha Copper-Gold Project (Oman) – On 23 November 2011, Alara Oman Operations Pty Limited (a
wholly owned subsidiary of the Company) (AOOPL) entered into a shareholders’ agreement with the concession holder, Al Hadeetha
Resources LLC (AHR) and the then shareholders of AHR. An Amendment Agreement between Alara and Al Hadeetha Investments LLC
(AHI) dated 3 August 2013 acknowledged that Alara then held a 70% shareholding in AHR and AHI held 30%. Post completion of a definitive
feasibility study, the AHR Board may issue shareholders with payment notices requiring them to contribute equity funding in proportion to
their shareholding. If AHI declines to make the required capital contribution to develop the Project’s first mine, then Alara may elect to pay
AHI the amount which AHI were required to contribute under their payment notice and (subject to Omani law) Alara may increase its economic
interest in AHR to 75%. This payment shall be treated as a loan and Alara shall be entitled to 60% of all dividends in favour of AHI until such
time that 25% of the total amount required under the payment notices is repaid to Alara. If an AHR shareholder’s interest falls below 10%,
that party shall (subject to Omani law) assign its dividend and voting rights to the other shareholder(s) in exchange for a 2% net smelter
return on production payable by AHR. On 18 November 2018 AOOPL sold a 19% interest in AHR to Al Tasnim Infrastructure Services LLC
(Al Tasnim). AHR is governed by a 4-member Board of directors with two nominees appointed by Alara (including the Chairman) one nominee
appointed by AHI (30% shareholder) provided that it continues to own at least 21% of the shares of AHRL and one nominee appointed by
Al Tasnim (19% shareholder) provided that it continues to own at least 19% of the shares of AHRL. Al Tasnim is not required to contribute
any additional funds to AHI in respect of the first mine to be constructed and operated by AHR - the Al Washihi mine.
Directors' Deeds – The Company has entered into deeds of indemnity with each of its Directors indemnifying them against liability incurred
in discharging their duties as directors/officers of the Consolidated Entity. As at the reporting date, no claims have been made under any
such indemnities and accordingly, it is not possible to quantify the potential financial obligation of the Consolidated Entity under these
indemnities.
Bayan Mining LLC JV Agreement – On 16 July 2015 Saudi Investments Pty Ltd (a wholly owned subsidiary of the Company) entered into
a JV agreement with Bayan Mining LLC. 40,000,000 shares are to be issued upon satisfaction of all of the conditions precedent, which
includes the granting of the Khnaiguiyah mining licence to Bayan or the JV.
(f) Loan to unrelated party (AHI) (Oman) - On 26 October 2017 AHI gave a bank guarantee of OMR 30,000 to the Omani Ministry of the
Environment as security for performance of the environmental obligations of AHR in connection with the Al Hadeetha Project mining licence.
AHI was required to deposit the amount of the face value of the bank guarantee with its bank as security in the event that the bank guarantee
is called upon. Pursuant to an agreement between the Consolidated Entity and AHI, the Consolidated Entity paid OMR 20,000 to AHI on or
about that date, representing an approximation of its share of liability to contribute to the costs of remediating any unmet environmental
obligations of AHR. This amount will be returned to the Consolidated Entity in the event that AHR performs its environmental obligations in
relation to that mining licence.
28.
SUBSEQUENT EVENTS
Events occurred after the balance sheet date are set out as below:
(a) Proposed issue of 5 million options
On 27 July 2020 the Company appointed Mr Atmavireshwar Sthapak as Managing Director. As part of his remuneration he will be issued 5
million options, each exerciseable within one year after vesting, with an exercise price of AUD 0.03 each. The options will vest upon the Company
achieving first production of saleable copper concentrate by 31 March 2022. This proposed issue is subject to Shareholders’ approval, which
will be sought at the 2020 AGM.
Mr Sthapak will be entitled to two further option issues, to be determined by the Board at a future date, to complete the long-term incentive
element of his remuneration. It is expected that options in each of these two issues will vest upon the attainment of separate milestones relating
to other aspects of the Company’s development, to be decided. The Company will announce the details of these proposed options when their
terms are finalised.
(b) Covid-19
As at 21 September 2020 Oman had 94,000 cases of Covid-19 with 850 deaths from the pandemic. Government offices are open and working
normally, as is Alara’s Omani office. Company personnel have remained Covid-free and have continued to work, while taking necessary
precautions. Former internal travel restrictions in Oman have largely been lifted. The suspension of commercial flights into and out of the
Sultanate is expected to be lifted in October, although the full resumption of international travel will also depend upon policies in place at foreign
airports.
The pandemic has had no substantial effect on the Company’s operations and it is not expected to do so. The principal work currently underway
is Front End Engineering and Design (FEED) for the Company’s proposed 1 Mtpa copper concentrate plant. FEED does not require the presence
of engineers on site, and was not significantly affected even by more restrictive Covid measures previously in effect.
(c) Security for project finance facilities
Alara’s 51% owned JV company, Al Hadeetha Resources LLC (AHRL) has accepted two offers of finance from separate banks in a club deal
to finance the development of its proposed 1 Mtpa copper concentrate plant16. Key commercial terms, including security, are:
Finance Amount: 20m OMR in total (2 x 10m) (~AUD 71.5 million17 in total)
for the year ended 30 June 2020
Profit rate: 6.75% per annum, reviewable annually.
Finance term: Repayable in 28 quarterly instalments, with a three-year grace period applying to principal payments (total ten-year
term).
Security: Over the AHRL mining licence and related assets; AHRL shareholder guarantees.
71
[The remainder of this page is intentionally blank]
16 17
16 Alara’s ASX Announcement dated 24 January 2017 contains the information required by ASX Listing Rule 5.16 regarding the stated production target. All
material assumptions underpinning the production target as announced on that date continue to apply and have not materially changed
17 At an exchange rate of OMR:AUD of 1:3.58 on 21 September 2020
Alara Resources Annual Report 2020
Directors’ Declaration
The Directors of the Company declare that:
1.
2.
3.
4.
5.
The Financial Statements, comprising the Consolidated Statement of Profit or Loss and Other Comprehensive Income, Consolidated
Statement of Financial Position, Consolidated Statement of Changes in Equity and Consolidated Statement of Cash Flows and
accompanying notes as set out on pages 22 to 44, are in accordance with the Corporations Act 2001 and:
(a)
(b)
Comply with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations
Regulations 2001; and
Give a true and fair view of the Consolidated Entity’s financial position as at 30 June 2020 and of its performance for the year ended
on that date;
In the Directors’ opinion there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable;
The Remuneration Report disclosures set out (within the Directors’ Report) on pages 14 to 19 (as the audited Remuneration Report) comply
with section 300A of the Corporations Act 2001;
The Company has included in the notes to the Financial Statements an explicit and unreserved statement of compliance with the International
Financial Reporting Standards.
Opinion
The Directors have received the declarations required to be made to the Directors by the Managing Director (the person who performs the
chief executive officer function) and Chief Financial Officer in accordance with section 295A of the Corporations Act 2001 for the financial
year ended 30 June 2020.
This declaration is made in accordance with a resolution of the Directors made pursuant to section 295(5) of the Corporations Act 2001.
Atmavireshwar Sthapak
Managing Director
25 September 2020
72
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
ALARA RESOURCES LIMITED
Report on the Audit of the Financial Report
We have audited the financial report of Alara Resources Limited (“the Company”) and its controlled entities
(“the Group”) which comprises the consolidated statement of financial position as at 30 June 2020, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement of
changes in equity and the consolidated statement of cash flows for the year then ended on that date and
notes to the financial statements, including a summary of significant accounting policies and the directors’
declaration of the Company.
In our opinion the financial report of the Group is in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its financial
performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under these
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report
section of this report. We are independent of the Group in accordance with the auditor independence
requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and
Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (Including Independence
Standards) (the “Code”) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given
to the directors of the Company, would be in the same terms if given to the directors as at the time of this
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
auditor’s report.
opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the financial report of the current period. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
Alara Resources Annual Report 2020
Independent Auditor’s Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
ALARA RESOURCES LIMITED
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Alara Resources Limited (“the Company”) and its controlled entities
(“the Group”) which comprises the consolidated statement of financial position as at 30 June 2020, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement of
changes in equity and the consolidated statement of cash flows for the year then ended on that date and
notes to the financial statements, including a summary of significant accounting policies and the directors’
declaration of the Company.
In our opinion the financial report of the Group is in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its financial
performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
The Directors
Alara Resources Limited
Suite 1.02
110 Erindale Road
Balcatta WA 6021
Basis for Opinion
Dear Directors
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under these
In accordance with Section 307C of the Corporations Act 2001 (the "Act") I hereby declare that to the best
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report
of my knowledge and belief there have been:
section of this report. We are independent of the Group in accordance with the auditor independence
(i) no contraventions of the auditor independence requirements of the Act in relation to the audit of
requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and
Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (Including Independence
Standards) (the “Code”) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
This declaration is in respect of Alara Resources Limited and the entities it controlled during the year.
(ii) no contraventions of any applicable code of professional conduct in relation to the review.
the 30 June 2020 financial statements; and
We confirm that the independence declaration required by the Corporations Act 2001, which has been given
to the directors of the Company, would be in the same terms if given to the directors as at the time of this
auditor’s report.
Daniel Dalla CA (Lead auditor)
Partner
Rothsay Auditing
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Dated 25 September 2020
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the financial report of the current period. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
73
Alara Resources Annual Report 2020 Independent Auditor’s Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
ALARA RESOURCES LIMITED (continued)
Key Audit Matter – Cash and Cash Equivalents
How our Audit Addressed the Key Audit Matter
The Group’s cash and cash equivalents make up
95% of total current assets by value and are
considered to be the key driver of the Group’s
operations and exploration activities.
We do not consider cash and cash equivalents to
be at a high risk of significant misstatement, or
to be subject to a significant level of judgement.
However due to the materiality in the context of
the financial statements as a whole, this is
considered to be an area which had an effect on
our overall strategy and allocation of resources
in planning and completing our audit.
Key Audit Matter – Exploration and Evaluation
Expenditure
The Group incurred significant exploration and
evaluation expenditure during the year.
We do not consider exploration and evaluation
expenditure to be at a high risk of significant
misstatement, however due to the materiality in
the context of the financial statements as a
whole, this is considered to be an area which had
an effect on our overall strategy and allocation
of resources in planning and completing our
audit.
Our procedures over the existence of the Group’s
cash and cash equivalents included but were not
limited to:
Testing a sample of cash payments to
determine they were bona fide payments,
were properly authorised and recorded in the
general ledger;
Checking the appropriateness of foreign
exchange rates used for cash and cash
equivalents denominated in foreign currencies;
and
Agreeing significant cash holdings to
independent third-party confirmations.
We have also assessed the appropriateness of the
disclosures included in the financial report.
How our Audit Addressed the Key Audit Matter
Our procedures in assessing exploration and
evaluation expenditure included but were not
limited to the following:
We assessed the reasonableness of capitalising
exploration and evaluation expenditure in
accordance with AASB 6 Exploration for and
Evaluation of Mineral Resources.
We tested a sample of exploration and
evaluation expenditure to supporting
documentation to ensure they were bona fide
payments; and
We documented and assessed the processes
and controls in place to record exploration and
evaluation transactions.
We have also assessed the appropriateness of the
disclosures included in the financial report.
74
Alara Resources Annual Report 2020 Independent Auditor’s Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
ALARA RESOURCES LIMITED (continued)
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2020, but does not include the financial
report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial report or
our knowledge obtained in the audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Directors’ Responsibility for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true
and fair view in accordance with the Australian Accounting Standards and the Corporations Act 2001 and for
such internal control as the directors determine is necessary to enable the preparation of the financial
report that gives a true and fair view and is free from material misstatement whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Group or cease operations,
or have no realistic alternative but to do so.
Auditor’s Responsibility for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with Australian Auditing Standards will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if individually or in
the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing
and Assurance Standards Board website at: www.auasb.gov.au/Home.aspx.
We communicate with the directors regarding, amongst other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we identify
during our audit.
75
Alara Resources Annual Report 2020 Independent Auditor’s Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
ALARA RESOURCES LIMITED (continued)
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit matters.
We describe those matters in our auditor’s report unless law or regulation precludes public disclosure about
the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected
to outweigh the public interest benefits of such communications.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the remuneration report included in the directors’ report for the year ended 30 June 2020.
In our opinion the remuneration report of Alara Resources Limited for the year ended 30 June 2020 complies
with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an
opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing
Standards.
Rothsay Auditing
Dated 25 September 2020
Daniel Dalla
Partner
76
Alara Resources Annual Report 2020 JORC Competent Persons Statements
JORC Competent Persons Statements
The information in this announcement that relates to the feasibility study of the Al Hadeetha
copper-gold project is based on information compiled by Mr Shanker Madan, who is a Member of
the Australasian Institute of Mining and Metallurgy, and consultant to Alara Resources. Mr Madan
has sufficient experience which is relevant to the style of mineralisation and type of deposit under
consideration, and to the activity he is undertaking to qualify as a Competent Person as defined
in the JORC Code, 2012 edition. Mr Madan consents to the inclusion in the announcement of the
matters based on his information in the form and context in which it appears.
The information in this announcement that relates to Ore Reserve of the Al Hadeetha Project
was compiled by Mr Harry Warries, who is a Fellow of the Australasian Institute of Mining and
Metallurgy, and a consultant to Alara Resources. Mr Warries has sufficient experience which is
relevant to the style of mineralisation and type of deposit under consideration, and to the activity
which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the
‘Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.’ In
assessing the appropriateness of the Ore Reserve estimate, Mr Warries has relied on various
reports, from both internal and external sources, in either draft or final version, which form part
of or contribute to the Al Hadeetha Project Feasibility Study. These reports are understood to
be compiled by persons considered by Alara to be competent in the field on which they have
reported. Mr Warries consents to the inclusion in the report of the information in the form and
context in which it appears.
The information in this announcement that relates to JORC Resources of the Daris Copper Gold
Project and the Al Hadeetha Copper-Gold Project (Oman) are based on, and fairly represents,
information and supporting documentation prepared by Mr Ravi Sharma, who is a Chartered
Member of The Australasian Institute of Mining and Metallurgy, Registered Member of The Society
for Mining, Metallurgy and Exploration. Mr Sharma was a principal consultant to Alara Resources
and has sufficient experience which is relevant to the style of mineralisation and type of deposit
under consideration, and to the activity he is undertaking to qualify as a Competent Person as
defined in the JORC Code, 2012 edition. Mr Sharma approves and consents to the inclusion in
the report of the matters based on his information in the form and context in which it appears.
Forward-Looking Statements
This report contains “forward-looking statements” and “forward-looking information”, including
statements and forecasts which include without limitation, expectations regarding future
performance, costs, production levels or rates, mineral reserves and resources, the financial
position of Alara, industry growth and other trend projections. Often, but not always, forward-
looking information can be identified by the use of words such as “plans”, “expects”, “is expected”,
“is expecting”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, or “believes”,
or variations (including negative variations) of such words and phrases, or state that certain
actions, events or results “may”, “could”, “would”, “might”, or “will” be taken, occur or be achieved.
Such information is based on assumptions and judgements of management regarding future
events and results. The purpose of forward-looking information is to provide the audience with
information about management’s expectations and plans. Readers are cautioned that forward-
looking information involves known and unknown risks, uncertainties and other factors which
may cause the actual results, performance or achievements of Alara and/or its subsidiaries to be
materially different from any future results, performance or achievements expressed or implied
by the forward-looking information. Such factors include, among others, changes in market
77
Alara Resources Annual Report 2020 conditions, future prices of gold and silver, the actual results of current production, development
and/or exploration activities, changes in project parameters as plans continue to be refined,
variations in grade or recovery rates, plant and/or equipment failure and the possibility of cost
overruns.
Forward-looking information and statements are based on the reasonable assumptions, estimates,
analysis and opinions of management made in light of its experience and its perception of trends,
current conditions and expected developments, as well as other factors that management believes
to be relevant and reasonable in the circumstances at the date such statements are made, but
which may prove to be incorrect. Alara believes that the assumptions and expectations reflected
in such forward-looking statements and information are reasonable. Readers are cautioned that
the foregoing list is not exhaustive of all factors and assumptions which may have been used.
Alara does not undertake to update any forward-looking information or statements, except in
accordance with applicable securities laws.
78
Alara Resources Annual Report 2020 SSeeccuurriittiieess IInnffoorrmmaattiioonn ((ccuurrrreenntt aass aatt 2277 OOccttoobbeerr 22002200))
Securities Information (current as at 27 October 2020)
IIssssuueedd SSeeccuurriittiieess
Fully paid, ordinary shares
TToottaall
QQuuootteedd oonn
AASSXX
634,886,315
663344,,888866,,331155
UUnnlliisstteedd
TToottaall
634,886,315
–
–– 663344,,888866,,331155
DDiirreeccttoorrss’’ aanndd EEmmppllooyyeeeess’’ UUnnlliisstteedd OOppttiioonnss
There are no Directors’ or employees’ options on issue. See the Company’s Notice of Meeting
for its 2020 Annual General Meeting for proposals to issue options to the Chairman and the
Managing Director.
DDiissttrriibbuuttiioonn ooff FFuullllyy PPaaiidd,, OOrrddiinnaarryy SShhaarreess
SSpprreeaadd ooff
HHoollddiinnggss
1 – 1000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 +
TTOOTTAALL
NNoo.. ooff HHoollddeerrss
NNuummbbeerr ooff UUnniittss
%% ooff IIssssuueedd CCaappiittaall
877
264
124
313
258
11,,883300
291,991
613,828
1,038,073
12,168,746
620,773,677
663344,,888866,,331155
0.046%
0.097%
0.164%
1.917%
97.77%
110000%%
UUnnmmaarrkkeettaabbllee ppaarrcceellss
Minimum $500.00 parcel at
$0.013 per unit
MMiinn ppaarrcceell ssiizzee
29,411
HHoollddeerrss
1,399
UUnniittss
4,454,513
TToopp 2200 OOrrddiinnaarryy FFuullllyy PPaaiidd SShhaarreehhoollddeerrss
RRaannkk
SShhaarreehhoollddeerr
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
TToottaall
Mr Vikas Malu
Ms Meng Meng
Mr Vikas Jain
Citicorp Nominees Pty Ltd
Mr Justin Richard
Al Hadeetha Investment Services LLC
Metals Corners Holding Co
Mr Piyush Jain
Whitechurch Developments Pty Ltd
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