2022 ANNUAL REPORT
Oman
Saudi Arabia
Alara Resources is transitioning
from mineral explorer to copper
concentrate producer,with
completion of our first copper
mining project only months away.
Alara Resources Annual Report 2022
1
Excellence
We will pursue excellence and will
strive for relevant best practice
combined with a fit- for-purpose
approach through continuous
improvement and teamwork in all
aspects of our business. To achieve
our goals, we will ensure our
employees and business partners
have the appropriate skills and
resources to perform their work
effectively and efficiently. We will
foster an open and supportive
environment in all activities and
relationships.
Respect
Alara values and shows consideration
for its employees, business partners,
customers, suppliers, governments,
communities, and the social and
physical environment in which it
operates.
Integrity
Alara and its employees are
committed to fairness and honesty
and operate with transparency and
accountability across all levels of
business.
Contents
2
Managing Director’s Letter
4
Projects Overview
23
Board of Directors
25
Management Team
31
Directors’ Report
49
Auditor’s Independence Declaration
50
Consolidated Statement of Profit and Loss
51
Consolidated Statement of Financial Position
52
Consolidated Statement of Changes in Equity
53
Consolidated Statement of Cash Flows
54
Notes to the Financial Statements
74
Auditor’s Report to Shareholders
79
Shareholder Information
81
Corporate Directory
Core Values
Mission Statement
Our mission is to increase shareholder value as a leading developer of mineral deposits and a
mineral producer on the Middle East region.
Alara Resources Annual Report 2022
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Managing Director’s Letter
Dear Shareholders
The past year has seen excellent progress towards completion of Alara’s flagship Al Wash-hi
– Majaza copper-gold project in Oman (the Project) along with positive developments for the
Company on other fronts.
In the face supply chain challenges posed by the Covid pandemic and unusually wet weather, our
Omani JV company Al Hadeetha Resources LLC (AHRL) achieved a number of key milestones in
construction of the 1Mtpa1 copper mining and processing facility. Notable achievements during
the reporting period include completion of the mine site accommodation village, execution
of a mine water supply agreement, the commencement of overburden pre-stripping and ore
stockpiling, delivery of the great majority of processing equipment to site and good progress in
the infrastructure build.
International supply chain bottlenecks placed pressure on the construction timeline, however our
team, partners and suppliers responded with agility to keep the impact to a minimum. The Project
is on track to produce its first copper concentrate by April 2023.
While Alara’s recent bid for the Khnaiguiyah exploration license in the Kingdom of Saudi
Arabia (KSA) was unsuccessful, our participation in the process saw the company form strong
relationships with key Saudi Government and industry parties and gain critical Saudi resource
industry knowledge. The Company is forming a 50-50 JV with our Omani partner Al Tasnim to
pursue exploration opportunities in KSA.
During the year Alara welcomed a new Non-Executive Director, Ms. Devaki Khimji, as a Director. Ms
Khimji is Managing Director of Al Tasnim Group, a major Omani construction and general industry
conglomerate. She brings extensive Middle Eastern and international business experience to the
Board.
As the Al Wash-hi Majaza project nears completion, the Company’s focus is shifting to augmenting
its new project pipeline. This includes progressing development of satellite copper projects and
seeking acquisition targets in Oman, pursuing Saudi Arabian opportunities and evaluating gold
projects in Australia, among other initiatives.
The medium to long-term outlook for copper remains bullish. While the proper price has come
off its historic high reached in March, the medium- to long-term outlook as strong, as demand is
Alara Resources Annual Report 2022
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projected to outstrip supply over the remainder of the decade by a substantial amount, as the
world transitions to a renewable energy future.
I am honoured by the trust which the Board, our Shareholders and partners continue to place in
me in leading the company as an emerging copper producer, making its own modest contribution
to a more sustainable world while delivering on shareholder value. None of our achievements
would be possible without the tireless efforts of skilled and dedicated personnel of our team, our
partners and suppliers.
I look forward to continuing to serve the Shareholders over the coming year as Alara moves
through this exciting transition phase in its growth journey.
Yours sincerely
Atmavireshwar Sthapak
Managing Director
1. Alara’s ASX Announcements dated 1 April 2016 (Definitive Feasibility Study results initial announcement), 24 January 2017 (DFS update), 28
June 2018 (NPV update) and 29 March and 7 April 2021 (NPV updates) contain the information required by ASX Listing Rule 5.16 regarding
the stated production target. All material assumptions underpinning the production target as announced on those dates continue to apply
and have not materially changed, except to the extent that a relevant assumption in an earlier announcement referred to above has been
updated by an assumption in a later announcement referred to.
Alara Resources Annual Report 2022
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Projects Overview
Wash-hi – Majaza Copper-Gold Project
Alara’s 51% owned joint venture company Al Hadeetha Resources LLC (AHRL) is developing a 1
Mtpa2 copper concentrator plant at the Al Wash-hi – Majaza copper-gold project in Oman (the
Project). The other shareholders in AHRL are Al Hadeetha Investment LLC (AHI) (holding a 30%
share) and Al Tasnim Infrastructure (ATI) (holding 19%). AHI is part of the well-known Omani
conglomerate Al Naba Services Group, owned by Sayyid Khalid bin Hamed Al Busaidi and
family. ATI represents the Al Tasnim Group, one of the largest construction and infrastructure
conglomerates in Oman.
Project construction is scheduled for completion in April 2023. The following section of this
Report details construction progress over the reporting period and an overview of Project
financials.
Current Development Summary
Construction progress
Construction work has progressed well since the ground-breaking ceremony in August 2021.
The picture below show the current state of Project infrastructure under construction.
Copper-gold processing plant construction progress (late October 2022)
Key construction fronts recently completed or underway include the grinding electrical room;
flotation bay; concentrate and tailing thickener foundations; bulk reagents building; flotation
electrical room; reagents bay; regrind mill foundation; ROM pad grading to enable retaining
wall works; grinding and classification tasks and stockpile foundation.
The picture below shows the location of key construction areas within the site.
2. Alara’s ASX Announcements dated 1 April 2016 (Definitive Feasibility Study results initial announcement), 24 January 2017 (DFS update), 28 June 2018 (NPV
update) and 29 March and 7 April 2021 (NPV updates) contain the information required by ASX Listing Rule 5.16 regarding the stated production target. All
material assumptions underpinning the production target as announced on those dates continue to apply and have not materially changed, except to the extent
that a relevant assumption in an earlier announcement referred to above has been updated by an assumption in a later announcement referred to.
Alara Resources Annual Report 2022
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Mining
Al Hadeetha Resources LLC (AHRL) entered a contract with Alara Resources LLC (ARL) for it to
perform mining services for AHRL over ten years at a cost of approximately USD 126m (AUD
167.83m). Alara holds a 35% share in AHRL.
Mining commenced before processing infrastructure completion. Overburden is being removed
and stockpiled and copper money is also underway. Ore is placed in a separate stockpile for
treatment once the processing facility is complete. Key mine development work including the
haul road, drainage channels, settling ponds, topsoil stacking, waste dump and ROM pad are
complete.
In March 2022 the first blast was conducted and topsoil from the first cut area was stockpiled for
post mine rehabilitation. Overburden stripping has progressed continually since that time and
copper oxide ore mining has subsequently commenced. Mining activities are conducted in two
10-hour shifts per day. The photo below shows the progress of mining pit excavation.
Al Wash-hi–Majaza mine pit (late October 2022)
Alara Resources Annual Report 2022
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Alara Oman Copper Portfolio
3D pit limits and orebody view. (Looking east-northeast. Wash-hi gossan hill in background)
As of September 2022, 2.7 million tonnes of overburden had been removed and 67,000 tonnes
of copper ore had been mined from the gossan.
Engineering, procurement and construction
AHRL appointed Progesys International (Progesys) as Project Management Consultant. Progesys
is overseeing and directing the engineering, procurement and construction for the Project.
Debisikha Associates, India (Debisikha) has been engaged to provide various services to the
Project, including:
• Front-end engineering design and preparation of technical specifications for 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.
AHRL commenced draw-down on its AUD 77m3 loan facility from Omani bank Sohar (Facility) from
Sohar, an Omani bank, during the reporting period. As at 30 September 2022, procurement
contracts had been awarded committing the JV to total capex of USD 24m (AUD 37m).
Key equipment consignments delivered in recent months include:
• Ball mill, LRS ball mill, SAG mill and crusher (Citic)
• Regrind mill (Matec and Metso)
• Thickener (Takraf)
• Pressure filter, hydraulic unit (Matec)
• Dust collector (Stratgem)
• Electricity substation infrastructure (ABB)
• Flotation cells (Innovator Poland).
3. The Facility is denominated in Omani Rial OMR (19m). The conversion from OMR to AUD was based on the exchange rate current at 28 October 2022.sumption in
an earlier announcement referred to above has been updated by an assumption in a later announcement referred to.
Alara Resources Annual Report 2022
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Alara Oman Copper Portfolio
The photos below show some key equipment packages delivered to site in recent months.
The Omani Government has kindly granted an AHRL an exemption from paying customs duty on imported
equipment and components of the concentrator plant arriving at Omani ports. This decision reaffirms the
sustained support which the Project has been receiving from all Government authorities and agencies
in the Sultanate. This is both a capital cost saving and reduces delays associated with the port customs
clearance process.
Mine-site accommodation camp
The mine site accommodation village, which can accommodate 325 personnel, was opened in January
2022. It currently houses the mine-site construction workforce. When infrastructure is complete, the village
will house the permanent mine workforce. The village comprises a range of facilities including, gymnasiums,
sporting fields, a prayer hall (mosque), recreation halls, mine operations offices and a testing laboratory.
Accommodation village – wide angle
Crusher
Substation transformers
Pressure filter
Ball mill feed shell
Alara Resources Annual Report 2022
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The accommodation village is designed for a minimum life of 12 years. This is comfortably above the
current estimated Project life of 10.4 years, giving the Company increased flexibility should further copper
discoveries be made along the strike zone or in nearby areas.
Process water supply
The water supply requirements identified in the DFS was reduced by amending the Project design to
adopt a dry tailings system. An 18,000 cubic-metre water storage reservoir is to be constructed on site.
In January, AHRL executed an agreement with Oman Water and Wastewater Services Company SAOC
(OWWSC), to secure the process water supply for the life of the mine. Under this agreement, OWWSC
will supply water to AHRL’s copper concentrator plant from its Sewage Treatment Plants (STPs) located in
close proximity to the Project site. The water will be priced at a fixed rate for the first five years. AHRL will
invest in upgrading the capacity of an STP to enable it produce 1,800 cubic metres of water per day. This
investment will be recovered over the life of the agreement through discounted water charges.
Equipment orders have been placed and construction works are scheduled to commence in the first week
of November.
Project power supply
Project power requirements will be sourced from two feeders from Omani electricity company MZEC,
over a distance approximately 2km from the Project site. A local contractor has been appointed to design,
supply and construct overhead power lines and the primary 33kV to 11kV substation at the site.
Power poles have been erected and boundary fencing plain cement concrete (PCC) works are complete.
Reinforced concrete works are in progress for the fencing works. The boundary wall is 90% complete.
Gantry erection is in progress. The SCADA panel is scheduled to have arrived by the time this report is
printed.
Project Economics
Definitive feasibility study
Alara completed an initial definitive feasibility study (DFS) for the Project in 2016. The DFS financial model
was revised in 2018 and in 20214 to take account of copper price rises. Revised DFS projected returns at 29
March 2021 based on a range of copper price scenarios are set out in the table below. As a comparison,
the LME spot copper price was USD 7792 per tonne on 27 October 2022. The table shows, however, that if
the copper price returns to its 2022 high of around USD 10,000 per tonne, Project NPV will approximately
double.
4. ASX announcements dated 29 March and 7 April 2021. The Announcements dated 1 April 2016 (initial Definitive Feasibility Study results
announcement), 24 January 2017 (DFS update), 28 June 2018 (NPV update) and 29 March and 7 April 2021 (NPV updates) contain the
assumptions and other information required by ASX Listing Rule 5.17 regarding forecast financial information in this section of this Report.
All material assumptions underpinning the forecast information as announced on those dates continue to apply and have not materially
changed, except where to the extent that a relevant assumption in an earlier announcement has been updated by an assumption in a later
announcements in the list.
5. All dollar amounts are in USD.
Wash-hi Majaza Copper Project
Project Parameter
Value5
Copper price (per tonne)
7,000
7,500
8,000
8,500
9,000
9,500
Revenue (m)
569
604
639
674
709
743
EBITDA (m)
208
241
273
306
338
370
NPV (m)
54
71
88
104
121
137
IRR (%)
24
29
33
36
40
43
Alara Resources Annual Report 2022
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Wash-hi Majaza Copper Project
Key parameters from the revised DFS are set out below:
Copper price outlook
The copper price reached a historic high of USD 10,200 per tonne in March 2022. Due to global market
uncertainty arising from post-Covid inflation, the copper price has since reverted to late-2020 levels of
around USD 7500 per tonne; still well above its historical average. At the date of this report, the copper
price is pushing back toward USD 8000 per tonne. Despite this recent price volatility, the medium to
long-term copper price outlook remains excellent in the Company’s view, due to the inexorable transition
of the world energy system to renewables.
International Energy Agency (IEA) modelling (see graph below) predicts that global copper demand
will outstrip supply by approximately 5 Mtpa (approximately 20% of total demand) by 2030. The graph
shows world copper production peaked in 2021, has plateaued since then, and is projected to go into
decline from 2023. New mines in development are expected to make up only a small part of the supply
deficit. This projected scenario is most encouraging for Alara’s copper development and exploration
program, covered in detail below.
Committed mine production and primary demand for copper, 2020 - 2030 (IEA)
Project Parameter
Value
Total pre-production capex
Mining method
Project construction
First production
Final production
Processing rate
Average annual concentrate production
Total tonnes copper metal production
Total gold ounces
Unit operating costs
USD 60m6
Open pit, 10.3 years
15 months
Q4 calendar 20227
20328
1 Mtpa
35,000 wmt
79,297 t
21,825 oz
USD 31.2/t of processed material
Operating Under construction Primary demand in the Stated Policies Scenario Primary demand in the Sustainable Development Scenario
6.
Including EPC, project management, sewage treatment plant and pipeline, power, road and contingencies.
7.
Since revised to April 2023.
8.
Since revised to 2033.
Alara Resources Annual Report 2022
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Metallurgical Test Work
A metallurgical test work drilling program was completed in the previous financial year. Mr Gary Patrick,
MAusIMM, CP (Met) was appointed to oversee the metallurgical testwork program, which was carried out
by Wardell Armstrong International, UK. This section provides a summary of the metallurgical test work
results.
Comminution test results
A full suite of ore characterisation tests was carried out on each of the main host rock types, namely
MET001C, MET002C and MET003C. Results of the ore characterisation tests are summarised in this table.
Ore characterisation test results
Major observations
The testing showed the average Bond Crusher Work Index values to range from 5.57kWh/t for the
MET003C Composite to 7.13kWh/t for the MET002C Composite. Based on the classification criteria
provided, the MET001C and MET003C Composites were determined to be “very easy” with respect to
crushability, whilst the MET002C Composite was identified as being “easy”.
The results of the SMC testing showed the Axb values to range from 41.81 for the MET001C Composite to
53.52 for the MET004C Composite. The SCSE values ranged from 8.54 kWh/t for the MET004C Composite
to 10.39 kWh/t for the MET002C Composite.
The results showed the Abrasion Index values range from 0.0374 for the MET001C Composite to 0.5903
for the MET002C Composite. Based on the standard classification criteria, the MET001C Composite was
classified as being “non-abrasive”, the MET002C Composite was classified as being “slightly abrasive” and
the MET003C Composite was classified as being “medium abrasive”.
The results of the Bond Rod Mill Work Index tests showed the Work Index values to range from 13.12kWh/t
for the MET002C Composite to 14.92kWh/t for the MET001C Composite. On this basis, the MET002C
and MET003C Composites were classified as being “medium” with respect to ore hardness/grindability.
The MET001C was classified as being “hard” with respect to ore hardness/grindability.
The results showed that the Bond Ball Mill Work Index values range from 14.06kWh/t for the MET001C
Composite to 14.96kWh/t for the MET003C Composite. The three samples were classified as “hard” with
respect to fine ore grindability.
Heavy medium separation (HMS)
To verify HMS tests conducted in 2013, fresh float-sink tests were carried out on the lower-grade Central-
South Composite (MET03F). The Composite sample was initially screened into the optimum size fraction
of -3.35mm+500µm, and the test carried out at a specific gravity of 2.8. Results of the float-sink analysis are
summarised in the table below.
HMS Test results
Test
Description
MET ID
Lithology ID
Units
MET001C
BAS/ BAS +
MST
MET002C
MM/SMS +
MNBST
MET003C
MNBST
Ai
grams
0.0374
0.5903
0.2171
CWi
kWh/t
6.76
7.13
5.57
BRWi
kWh/t
14.92
13.12
13.40
BBWi
kWh/t
14.06
14.42
14.96
Size
Fraction
Spec. Grav.
Separation
Mass
Assay
Distribution (%)
Grams
%
Cu%
Au ppm
TS%
Cu
Au
TS
-3.35 mm
+ 500µm
Feed Testwork
-2.8 / Floats
13,878
60.95
0.16
0.08
3.49
15.91
11.00
17.52
+2.8 / Sinks
8,890
39.05
1.32
1.01
25.65
84.09
89.00
82.48
DMS Feed
22,768
100.00
0.61
0.44
12.14
100.00
100.00
100.00
Alara Resources Annual Report 2022
11
The results show that 61% of the feed reported to the floats (rejects) fraction. However copper and gold
losses to the rejects fraction were high at 16% and 11% respectively.
As a result of these high metal losses to the rejects fraction it was decided not to progress with further
evaluation of HMS technology.
Flotation
Flotation testing was carried out during the reporting period on the three (3) main composites. Flotation
test parameters were taken from the previous testing undertaken by ALS. The ALS flotation circuit was also
used as the base case for testing and the results were found to be in close proximity only.
Batch rougher optimisation tests were carried out investigating float residence times, reagent addition
rates and alternate collectors. Open cycle cleaner tests were carried out with and without a regrinds stage
and varying 1st cleaner float times.
A single locked cycle test was carried out on each of the master composites to determine the final
metallurgical performance. Results of the locked cycle tests are summarised in the two following tables.
The following figure shows composite sample zones within the orebody.
The final metallurgical performance for the different metallurgical composites is:
•
North Upper: copper recovery of 85% at a final concentrate grade of 28.4%Cu
•
North Lower: copper recovery of 92% at a final concentrate grade of 25.1%Cu
•
Central-South: copper recovery of 87% at a final concentrate grade of 20.1%Cu.
The results show high copper recoveries can be achieved to a saleable concentrate grade of >20%Cu.
A trade-off between copper grade and recovery can be made to optimise copper recovery to a fixed
copper concentrate grade based on discussions with metal traders.
Test work carried out at Wardell Armstrong has confirmed:
•
The Wash-hi Majaza ores exhibit low abrasiveness and moderate grinding characteristics
•
Flotation tests confirm the optimum primary grind size as a P80 of 75µm
•
The flotation circuit is fairly conventional with a rougher/scavenger circuit, followed by regrinding of the
rougher/scavenger concentrates, and two-stage cleaning to produce a saleable copper concentrate,
with minor gold credits
•
An optimum regrind size of P80 of 25µm is required to ensure selectivity between chalcopyrite and
pyrite.
Testing at Wardell Armstrong confirmed that the overall metallurgical performance is dependent on the
copper head grade to the plant, i.e. a higher copper grade results in a higher copper recovery to the final
copper concentrate. The process plant is designed to treat a head grade of 1.3%Cu, for which a copper
recovery of 92.1% at a concentrate grade of 24.6% Cu, and mass pull of 4% by weight is obtained. Latest
process technologies will be investigated to further improve the metallurgical performance of Cu and Au.
North Upper Ore Zone – LCT 1
North Lower Ore Zone – LCT 1
Product
Cycle
Weight
(g)
Weight
(%)
Assay (%)
Distribution (%)
Cu
Au
S(TOT)
Cu
Au
S(TOT)
Cleaner 2 Conc
5+6
126.71
3.17
28.42
3.77
38.34
84.59
19.33
6.03
Cl 1 Tailings
5+6
483.34
12.09
0.78
1.09
27.74
8.83
21.32
16.64
Rougher Tailings
5+6
3388.24
84.74
0.08
0.43
18.39
6.59
59.35
77.33
Feed
3998.29
100.00
1.06
0.62
20.15
100.00
100.00
100.00
Product
Cycle
Weight
(g)
Weight
(%)
Assay (%)
Distribution (%)
Cu
Au
S(TOT)
Cu
Au
S(TOT)
Cleaner 2 Conc
5+6
156.80
3.96
25.11
1.36
39.87
92.21
33.49
13.27
Cl 1 Tailings
5+6
649.03
16.37
0.31
0.28
28.98
4.78
28.82
39.93
Rougher Tailings
5+6
3157.94
79.67
0.04
0.08
6.98
3.01
37.69
46.80
Feed
3963.77
100.00
1.08
0.16
11.88
100.00
100.00
100.00
Alara Resources Annual Report 2022
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Central-South Ore Zone – LCT 1
Omani Copper Portfolio
Omani Copper Licences
AHRL is the first JV with an international participant to be awarded a copper mining license in Oman.
AHRL holds the Al Hadeetha Mining License at Wash-hi – Majaza covering 3km2, within the Wash-
hi Exploration License area, and four other mining license applications pending grant, totalling
7km2. In total, Alara has interests in joint venture in five copper-gold exploration licenses in Oman,
covering an area of 1,186km2. The figure below shows the locations of the Company’s exploration
licenses in Oman, including JV license areas. In addition Alara has another 10 base and precious
metal exploration license applications totalling 2,677km2 pending grant at the date of this Report.
Oman Copper Block & Alara JV Exploration Licenses in Oman
Al Hadeetha Resources’ projects
The AHRL JV was formed in 2011 by Alara and AHI to explore and develop the Wash-hi, Mullaq
and Al Ajal copper-gold concessions and surrounding regions. Al Tasnim joined the JV in 2018.
Since 2011, Alara-led exploration in these areas has identified substantial copper resources. Mining
license applications have been submitted within each exploration license area. The Al Wash-hi –
Majaza mining licence was granted in 2018. The table over the page shows the status of all AHRL
licenses, which together form the Al Hadeetha Copper-Gold Project (also known as the Wash-hi –
Majaza Project).
Product
Cycle
Weight
(g)
Weight
(%)
Assay (%)
Distribution (%)
Cu
Au
S(TOT)
Cu
Au
S(TOT)
Cleaner 2 Conc
5+6
125.72
3.16
20.11
2.00
36.93
86.62
15.06
9.16
Cl 1 Tailings
5+6
507.30
12.74
0.41
0.72
18.21
7.16
21.87
18.22
Rougher Tailings
5+6
3348.85
84.10
0.05
0.32
10.99
6.22
63.07
72.62
Feed
3981.87
100.00
0.73
0.42
12.73
100.00
100.00
100.00
Alara Resources Annual Report 2022
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Al Hadeetha JV licenses
The Wash-hi – Majaza copper deposit is within the Wash-hi Exploration License area, approximately
160 km SE of Muscat via a sealed road. It is distinguished by a gossan hill in the centre of a gravel
plain.
Wash-hi Exploration Licence and Washi-hi Majaza Mining Licence areas
Exploration Licenses
Mining License within Els
Name
Owner
Alara
Share
Area
Grant
Expiry
Renewal
Applied
Status
Area
Date
Applied
Status
Wadi Andam
AHRL
51%
39km2
Jan ‘08
Jan ‘16
May ‘18
Granted
3km2
April ‘13
Granted ‘18
Mullaq
AHRL
51%
41km2
Oct ‘09
Oct ‘16
April ‘18
In process
1km2
Jan ‘13
In process
Al Ajal
AHRL
51%
25km2
Jan ‘08
Jan ‘16
April ‘18
In process
1.5km2
Jan ‘13
In process
Alara Resources Annual Report 2022
14
Mineral reserves and resources
AHRL has conducted an extensive exploration program in the license area, resulting in the
discovery of a substantial copper resource at Wash-hi – Majaza. Resource and reserve statements
are provided in the two tables below. An Inferred Resource of 0.31MT at 0.51g/t Au was also
identified in the gossan, outside the main ore body.
Mineral resources summary – 0.25% Cu cut-off
Additional copper potential
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.
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.
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 (conceptual) copper and gold mineralization
targets in the Mullaq license area are shown in the following table.
Resource
Tonnes (m)
Cu %
Indicated
12.4
0.89
Inferred
3.7
0.79
Total
16.1
0.87
JORC Category
Tonnes (m)
Cu %
Au g/t
Probable Reserve
9.70
0.88
0.22
Ore reserve statement
Alara Resources Annual Report 2022
15
Mullaq exploration targets (grades are approximate)
(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.)
Mullaq 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 the Taww area, near the northern coast
of the Sultanate of Oman and about 65km west of Muscat, as shown in the following figure.
Al Ajal Mining License application area
License area
Target No
Target Type
Tonnage (Range)
Grade Cu%
Au (g/t)
Mullaq 41km2
MQT-1
Extensions of non JORC
resources at Daris 3A5
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
Alara Resources Annual Report 2022
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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 (conceptual) copper and gold mineralization
targets in the Mullaq license area, are shown in the following table.
Mullaq exploration targets (grades are approximate)
(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.)
RTP magnetics regional exploration targets in Mullaq license areas
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.
License area
Target No
Target Type
Tonnage (Range)
Grade Cu%
Au (g/t)
Mullaq 41km2
MQT-1
Extensions of non JORC
resources at Daris 3A5
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
Alara Resources Annual Report 2022
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Al Ajal Exploration License
Overview
The Al Ajal Prospect is located near the village of Al Ajal in the Taww area, near the northern coast
of the Sultanate of Oman and about 65km west of Muscat, as shown in the next figure.
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 next figure).
Prospective areas within Al Ajal Exploration License
EP slice at 100m depth
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 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.
Alara Resources Annual Report 2022
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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.
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
Overview
Daris Resources LLC is 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.
Block 7 Exploration License and Mining License application areas
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Alara Resources Annual Report 2022
19
Two Mining Licence applications filed over Daris East and Daris 3A-5 prospects within the
exploration licence remain pending. The table below provides details of licenses at Daris. Recent
site visits conducted by Ministry officials gave positive indications for these applications advancing
towards issuance.
Daris License details
Daris East prospect
The copper resource for the Daris-East Prospect is outlined below:
Daris East prospect copper resource
The following drilling has been carried out at the Daris East Project:
• 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.
• In addition, historic drilling data from 44 holes totalling 4,353m has been included in the
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. The drill hole location
map and intersection table are set out below.
Daris 3A5 drill-hole locations
Block/License
Exploration Licenses
Mining License within ELs
Name
License
owner
Alara
share
Area
Date of
Grant
Renewal
applied
for
Status
Area
Application
Date
Status
Block 7
Al Tamman
Trading and
Est. LLC
50%
587km
2
Nov 2009
May 2018 Deemed
granted
Daris East 2km2 Dec 2012
In process
Daris 3A5 .3km2 Dec 2012
In process
Ore type
Cut-off grade
Cu%
Measured
Indicated
Inferred
Tonnes
Cu%
Tonnes
Cu%
Tonnes
Cu%
Sulphides
0.50
130,000
2.50
110,000
2.20
30,000
2.00
Oxides
0.50
96,000
0.89
86,000
0.7
2,000
1.00
Alara Resources Annual Report 2022
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Daris 3A5 drillhole results are set out in the table below.
Significant intersections from core drilling – Daris 3A5 prospect
Notes:
• The cut-off grade is 0.2% Cu is in respect to 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.
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Drill Hole
Significant Mineralisation
Mineralised Zone
Intersections
From (m)
To (m)
Length (m)
Cu (%)
Au (g/t)
Ag (g/t)
D3DC001
Primary
15
37.65
22.65
1.61
3.39
50.68
Inclusion
30
37.65
7.65
4.69
3.71
77.95
D3DC002
Primary
28.4
46.25
17.85
3.85
2.61
22.51
Inclusion
34.35
46.25
11.9
5.74
2.06
24.07
Primary
50.6
59
8.4
4.45
1.36
20.34
Inclusion
50.6
54.05
3.45
10.28
3.1
46.79
D3DC003
Primary
41
71.75
30.75
4.69
1.56
16.75
Inclusion
51.5
68.7
17.2
8.05
2.67
28.95
D3DC008
Primary
23
35.8
12.8
0.74
6.62
31.11
Inclusion
33.5
35.8
2.3
3.92
5.2
106.37
D3DC009
Primary
21
31
10
0.07
3.34
5.41
Inclusion
23
25
2
0.06
7.13
23.67
Primary
36
39
3
0.85
0.01
1.23
D3DC010
Primary
57
67
10
5.62
1.16
17.82
Inclusion
59.35
65.7
6.35
8.58
1.78
27.48
Alara Resources Annual Report 2022
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Awtad Resources LLC Copper Project
Overview
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
approximately 497km2.
The Company is party to 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 exploration activity on Block 8. Rock chip samples returned multi-
elemental enrichment of up to 2.68% Cu, 2.4ppm Ag, and 0.1% Zn, indicating a potential base
metal deposit under the surface. Alara expects to conduct further exploration on this property in
the coming year.
Alara Resources LLC – Mining Services Company
Overview
Alara Resources LLC (ARL) is a Joint Venture between Alara Oman Operations Pty Ltd (35%), a
wholly owned subsidiary of Alara Resources Limited, Southwest 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 Tasnim group, one of the largest construction and general industrial conglomerates in Oman.
Demand for exploration and general drilling in Oman returned to its usual level after a slow-down
due to COVID-19. ARL has two drill rigs and associated accessories and is actively seeking and
obtaining work in this sector.
Exploration and mining services
ARL recently completed a two-phase drilling contract at a limestone license in Oman. ARL is also
Alara Resources Annual Report 2022
22
registered as an approved services provider to Minerals Development of Oman Company (MDO)
the Omani Government’s exploration and mining company.
ARL is receiving and responding to invitations to tender for exploration drilling for base metals
and industrial minerals projects from MDO and various other projects from other parties in Oman.
ARL was also awarded a ten-year mining contract at AHRL’s Wash-hi – Majaza project, as detailed
further in the section of this report concerning that project, above.
Saudi Arabia
Khnaiguiyah Exploration License Bid
Alara Resources formed a joint venture with Al Tasnim Infrastructure LLC (Alara-Tasnim JV) to bid
for an Exploration License (Khnaiguiyah Licence or Licence) over the Khnaiguiyah Zinc-Copper
prospect in the Kingdom of Saudi Arabia (KSA). Alara held a 51% share in this JV. In 2013, Alara
had conducted a definitive feasibility study over a small part of the 353km2 area covered by the
Khnaiguiyah Licence, which revealed the potential to develop a robust zinc copper project on
that area.
Of 24 parties initially invited to make proposals for the award of the Khnaiguiyah Licence, the
Alara-Tasnim JV was shortlisted in the final three. A competitive bidding process was then held
(Licence Auction) with the Licence to be issued to the consortium which offered to pay the highest
amount (called a signing bonus) to the Saudi Ministry of Industry and Mineral Resources (MIMR).
The Alara-Tasnim JV lodged the second-highest bid in the Licence Auction. Under the Licence
Auction rules, the Alara Tasnim JV was accorded the status of “Reserve Bidder” as a result. If
negotiations between MIMR and the successful bidder to finalise the issue of the Licence are
unsuccessful for any reason, MIMR will then commence negotiating the potential issue of the
Licence to the Alara-Tasnim JV, as Reserve Bidder.
Follow-on opportunities
As a result of participating in the Licence Auction, Alara and Al Tasnim made, and built on, new
and existing relationships with key Government and industry participants in the Saudi resources
sector. Alara is perceived by many as having made a positive contribution to that country’s growing
mining industry by its earlier development work at Khnaiguiyah. The Board considers that Alara’s
resulting reputation in this country is beneficial to re-establishing a presence there.
The KSA Government has an ambitious plan to further diversify its resource industry well beyond
its traditional focus on hydrocarbons. As a result, a number of other opportunities to bid for, or
stake, other mineral exploration licenses have become available to the Company in KSA. Alara
and Al Tasnim are forming a new, 50-50, joint venture to identify and exploit these opportunities.
We look forward to updating investors as and when our new Saudi JV seeks to acquire particular
projects in that country.
Western Australia
The Company has recently commenced scoping out the potential to participate in gold and other
mineral projects in Western Australia. The Company will provide investors with more detail when
any specific opportunity in that State emerges.
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Alara Resources Annual Report 2022
23
Board of Directors
Stephen Gethin, Barrister and Solicitor
Non-Executive Chairman
Mr Gethin is a highly regarded professional with over 30 years’ experience
in the provision of resources and corporate legal advice and documentation
and management of ASX-listed companies in a range of industries, including
resources, technology and investment.
He was involved in the establishment of iron-ore mines in Peru and the Pilbara as
General Counsel at Strike Resources Limited (ASX:SRK). Prior to his role at Strike
her was General Counsel and Secretary at ERG Limited (ASX:ERG) a Perth-based
international technology engineering company.
Atmavireshwar Sthapak B.Sc, MTech
Managing Director
Mr Sthapak is a geologist with 30 years’ experience specializing in mineral resource
exploration and evaluation studies. He joined the Company in 2011 as 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 2021, 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 MBA
Non-Executive Director
Mr Jain holds an MBA obtained in the USA and has 20 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 Southwest
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.
Board and Management
Alara Resources Annual Report 2022
24
Sanjeev Kumar MBA (Finance & Marketing), IMT Ghaziabad, India; BE (Metallurgy),
VNIT Nagpur, India
Non-Executive Director
Mr Kumar has extensive Australian and international business experience, with a
specialisation in high-value asset finance lending.
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.
Devaki Khimji
Non-Executive Director
Ms. Khimji is the Managing Director of Al Tasnim Group. Al Tasnim is a major all-
service group in the Omani construction industry, with over 30,000 employees.
The Group leads the Omani construction industry in contracting, manufacturing of
cement products, building finishes products and roads, asphalt and infrastructure
works, among other product offerings. Ms Khimji is experienced in leading and
growing a wide range of businesses, establishing profitable relationships with
clients and suppliers across the world.
She served as Managing Director of India Circus Pvt. Ltd, an online lifestyle
products retailer in India, guiding the brand through the market with her strong
management skills. Her business acumen and foresight were essential to the
company’s launch and financial growth. She is also a pioneer of fitness club/gym
management systems, becoming a very successful entrepreneur in the software
and e-commerce industries.
Farrokh Masani
Non-Executive Director (alternate for Devaki Khimji)
Mr Masani is an inspirational leader with over thirty (30) years’ experience in the
ever-evolving construction industry. He is an ambitious visionary with a strong track
record of creating and growing businesses in a competitive environment, with a
commitment to the principles of excellence through innovation and teamwork.
Mr Masani has extensive commercial expertise and in-depth knowledge of civil
construction, HVAC, plumbing, firefighting, electrical systems design and project
management. Possessing exceptional communication skills and firm arbitration
tactics, he is a leader who is also known for attention to detail and exemplary
decision-making during times of high pressure.
Dinesh Aggarwal, FCPA, CA, CMA, FTI, DipFS (Advanced)
Company Secretary and Chief Financial Officer
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 – an award-winning,
multi-disciplinary practice with Tax & Business Advisory, Legal Services, Mortgage
Broking and Financial Planning divisions.
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, and has won numerous other awards.
Alara Resources Annual Report 2022
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AHRL JV Management Team
Avigyan Bera BTech, PEngg (SAIMECHE)
CEO (AHRL)
Mr. Bera has more than 16 years of experience in handling EPC Projects in India and
overseas. He had been involved in projects right across the globe in various countries
like India, Zambia, South Africa, Liberia, Namibia, Mongolia, Iran, UAE, Bulgaria,
Morocco etc. 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 & Middle East regions.
Mr Bera joined AHRL in June 2020. He brings in all the experience and technical know-
how for executing Owner Managed Projects through his good vendor contacts and
key knowledge in process engineering, project execution and overall management
skills.
Rajesh Bhayani B.E. (Production), M.Tech. (Mech.)
Chief Procurement Officer
Rajesh is a seasoned Procurement Professional with 30+ years of diverse experience
in Global Sourcing and Supply Chain. He has worked with leading companies in
the field of EPC, oil and gas and infrastructure, including Al Tasnim Enterprises, our
stakeholder. He has also worked at Reliance Industries (India) and Galfar (Oman).
He has 13+ years of experience of the GCC region. Rajesh has also interfaced
with renowned consultants (McKinsey, AT Kerney, and Rolland Burger) to optimize
procurement functions and systems. He is a six sigma black belt, ISO internal Auditor,
and SAP-certified procurement consultant.
Rexin Kamilas BACS, M.Com, Tally
Finance and Administrative Manager
Mr. Rexin Kamilas is a business administration and accounts Officer having more than
15 years of administration and Accounts experience in Oman and India. He joined
Alara in 2011 as an administrative and accounting assistant. He was involved in various
business operations related to all company administration, Banking, Insurance,
finance, procurements, and logistics. He produces the financial reports and provides
support to all finance department activities.
Mr. Kamilas has utilised 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 that will be the solid foundation for future corporate
developments.
Mr. Kamilas was successfully able to run all financial and operations activities required
to accomplish the first drilling project for ARL the subsidiary of AUQ in Oman, besides
the support for Al Washi-hi Copper project operations support.
Nehal Hasan Warsi BSc (Geol. Hons), MSc (App. Geol.) PGD (Hydrogeol)
Geologist
Mr. Warsi is a geologist with over 16 years of 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 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.
Alara Resources Annual Report 2022
26
Lakshman R. Muthyam B.Sc IT, A.U.
Company Secretary (AHRL)
Mr. Muthyam is an experienced Administration and Information Technology
professional with over 9 years of experience in India and Oman.
Mr. Muthyam joined AHRL in April 2019. He oversees the corporate governance of
AHRL. 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 holds certified courses in Contract Law and
Justice from Harvard University.
Rajesh N. Gandhi B.Com, Chartered Accountant (CA)
Finance Controller
Rajesh Gandhi has over 11 years of experience in finance and accounting in India.
He joined AHRL in March 2021 as finance controller. He has a key role in budgeting
control, finance, MIS, VAT of AHRL.
He was associated with an MNC company in India engaged in mining, processing &
manufacturing of Bentonite minerals, bauxite & allied mineral products. He has been
involved in various business operations related to the overall Finance function, MIS
reports, forex transactions, Letter of Credit, taxation matters, finalization of financial
statements, budget control, compliances with regulatory authorities & overall
accounting.
Amjad Al Sharji Dip (Civil Engg.), IOSH, NEBOSH
HSE Manager
Mr. Amjad Al Sharji is an experienced HSE Manager with over 6 years of experience
in various sectors in Oman. He joined AHRL in October 2021. Prior to this, he worked
as a consultant with MMC and dealt with a number of electricity companies such as
OETC and Mazoon.
He holds a set of professional HSE training certificates. He has experience in electrical
safety, stations, transmission lines, electrical transfers, hilly areas, construction, and
food safety. He worked to reduce the incidence of accidents, risks and environmental
damage and participated in developing safety standards, raising awareness of the
importance of health and safety.
Asma Ali Al Omairi
HR Manager
Mrs. Asma is a Human Resources Manager with 20 years’ experience in the field of
Administration and Human Resources. She joined AHRL in June 2022 as part of its
workforce ramp-up as its mining project moves towards production. Her role includes
managing the staffing process (recruiting, interviewing, hiring and on-boarding)
implementing Company policies, maintain HR system and Process etc.
Prior to joining AHRL, she worked as Assistant Manager HR and Administration in
Awam Group LLC and as HR and Administration Senior Executive at Suhail Bahwan
Group Holding, one of the largest businesses in the Middle East.
Shiva Konetti BTech, CE (JNTUH)
QA/QC Manager (AHRL)
Mr. Konetti has over 9 years’ experience in managing Quality Assurance/Quality
Control departments on various leading EPC projects in Oman and India.
As a certified Internal and External Auditor of ISO 9001 quality management systems,
he brings immense experience in planning, execution and control of the quality
aspects of the project, and ensures that fulfilment quality standards are met to the
fullest extent.
Shiva’s leads the quality assurance and control aspects through participating in day-
to-day quality assurance activities, strongly influencing the project, to ensure that
Alara Resources Annual Report 2022
27
construction activities align to the required quality standards, thus ensuring that
the final product is delivered to stakeholders’ satisfaction.
Marwan Abdullah Al-Busaidi Bachelor degree in Arts, Science, Geography &
Population Studies.
Technical Support Officer /Govt Relation Office
Mr. Marwan is an experienced technical and administrative officer, having worked
for over 6 years’ in various industry sectors in Oman. He joined AHRL in August
2022. He has since been involved in many aspects of the business, including the
key areas of the Project water supply agreement with HAYA Water, the customs
waiver for imported equipment, liaising with the customs authority regarding
import clearances and liaising with Oman Vision 2040 Implementation Support
and Follow-up Unit (ISFU) and other Ministries in relation to Project licensing
issues. Mr. Marwan holds professional training certificates in Population and
Social Statistics and Surveys.
Shankar Paramasivam MBA (HR)
Mining Camp Boss
Mr. Paramasivam is a seasoned accommodation manager, office manager,
and human resources executive with over 16 years’ experience in various
sectors throughout the Gulf region. He oversees camp operations, site office
administration, and hospitality. Prior to this, he worked in the construction, oil and
gas, transportation, and telecommunications sectors for leading companies and
a semi-government company in several Gulf countries.
He has worked in accommodation and facility operations, office and human
resource administration, catering operations, payroll preparation, security
and hygiene operations, worker welfare activities, waste management and
transportation control. He has managed a camp with over 15,000 personnel from
various countries living in one location. He also has a Food HACCP, First Aid and
Fire Fighting certifications.
Zahra Albattashi Dip Acctg. and Bus. Admin. (Muscat College)
Admin/Accounts Support
Ms. Albattashi has over 4 years’ experience in the field of reception, office
administration and foreign exchange. She joined the company in March 2022.
She handles SAP data entry and serves as the Company’s liaison with Government
departments for project-related licences.
Prior to joining AHRL she worked for the Superior Care C.O. LLC in administration
and accounting and, prior to that, worked at an international currency exchange,
handling exchange transactions and transferring money.
Jitendra Kumar Samantaray Dip (MM), BA (His.)
Mining Camp Storekeeper
Mr. Samantaray is an experienced commercial officer with over 15 years’
experience in various sectors and has extensive knowledge of SAP, ERP and Imps.
He joined AHRL in February 2022. He has worked with leading companies in the
field of construction and infrastructure including Al N’aba Holdings (Oman), a
large industrial conglomerate in Oman. Other leading companies for which he
has worked include Simplex Infrastructure, JMC India Projects (India) and Gitto
Constrozione (Africa).
Alara Resources Annual Report 2022
28
Saudi Arabia
Fadi Zenaty B.Sc. IMS and Business Administration
Saudi Arabia Country Manager
Mr. Zenaty has over 16 years of professional experience in Saudi Arabia and in
mining and construction projects in the Middle East generally. He brings a vast
knowledge of corporate operations and economic evaluation in building projects
from the ground up.
Fadi was instrumental in obtaining the exploration and mining licenses for
the company’s former Al Khnaiguiyah Zinc and Copper 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 achievement of being able to
navigate the governmental rules and techno 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 roles in organization systems analysis
and IT development in improving the overall operations of the corporations,
which he is engaged in improving.
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Alara Resources Annual Report 2022
29
Mineral Licences
Al Hadeetha and Daris Copper-Gold Projects
Alara has joint venture interests in five copper-gold deposits located within four Exploration
Licences in Oman, extending over 692km2. These deposits are also covered by five Mining
Licence applications pending grant, totalling approximately 9km2.
The Wash-hi and Mullaq 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 Copper-Gold Project is located approximately 150km West of Muscat. These projects/
prospects 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
Mineral project licence details
Copper Resources
Gossan hill mineralisation – Gold9
Note: Mineral Resources are not Mineral Reserves. There is no certainty that all or any part of the Mineral
Resources estimated will be converted into Mineral Reserves. Mineral Resources reported in accordance
with the JORC 2012. 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.
Licence Name
Licence
Owner
Alara JV
Interest
Exploration Licence
Mining Licence within EL
Area
Grant
Date
Expiry
Date
Status
Area
Application
Date
Status
Wash-hi Majaza
AHRL
51%
39km
2
Jan
2008
Nov
2016
Active
2.1km
2
Dec 2012
Granted
Mullaq
AHRL
70%
41km
2
Oct
2009
Nov
2016
Active
1km
2
Jan 2013
Pending
Al Ajal
AHRL
70%
25km
2
Jan
2008
Nov
2016
Active
1.5km
2
Jan 2013
Pending
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
12.40
0.89
0.22
3.70
0.78
0.23
0.25
12.40
0.89
0.22
3.70
0.79
0.23
0.30
12.40
0.89
0.22
3.70
0.79
0.23
0.40
12.20
0.90
0.22
3.50
0.81
0.24
0.50
11.40
0.93
0.23
3.00
0.88
0.25
Cut off
(Au g/t)
Inferred Resource
Kt
Au g/t
k/Oz
0.05
440
0.40
5.66
0.10
420
0.40
5.40
0.15
410
0.40
5.27
0.20
350
0.50
5.63
0.25
310
0.50
4.98
0.30
270
0.50
4.34
0.35
260
0.60
5.02
0.40
220
0.60
4.24
0.45
200
0.60
3.86
0.50
150
0.60
2.89
0.05
440
0.40
5.66
0.10
420
0.40
5.40
9. See Alara’s 19 September 2016 ASX Announcement.
Alara Resources Annual Report 2022
30
Wash-hi copper-gold resources summary @ 0.25% Cu cut-off 10
Indicated resources were converted to a probable ore reserve after the application of modifying factors,
including pit optimisation, mine design and an economic evaluation11
The ore reserve estimate (based on a 0.3% Cu cut-off) and in-pit mineral inventory are shown in the tables
below.
Wash-hi ore reserve
Wash-hi mining inventory
[The remainder of this page is intentionally blank]
Resource
classification
Mt
Copper (Cu) %
Gold (Au)
g/t
Indicated
12.4
0.89
0.22
Inferred
3.71
0.79
0.23
Grand total
16.1
0.87
0.22
Classification
Ore reserve
Tonnes Mt
Copper (Cu)
%
Gold (Au) g/t
Probable reserve
9.7
0.88
0.22
Classification
Tonnes Mt
Copper (Cu)
%
Gold (Au)
g/t
Ore reserve
9.7
0.88
0.22
Inferred resource
0.3
0.65
0.22
Total
10.00
0.87
0.22
10. Refer Alara’s 15 December 2016 ASX Announcement: Maiden JORC Ore Reserves – Al Hadeetha Copper-Gold Project.
11. Details of the modifying factors supporting the Ore Reserve are contained in Appendix 1 (JORC Code, 2012 Edition - Table 1) of the 15 December 2016
announcement.
Alara Resources Annual Report 2022
31
The Directors present their report on Alara Resources Limited (Company, Alara or AUQ) and the entities it controlled at the end of or during the
financial year ended 30 June 2022 (the Consolidated Entity).
Review of Operations
Al Wash-hi Majaza Copper-Gold Project
Oman
(Alara – 51%; Al Hadeetha Investments LLC – 30%; Al Tasnim Infrastructure Services LLC 19% (AHRL))
Project construction phase now well-progressed
Work on the Al Wash-hi Majaza copper-gold project in the Sultanate of Oman (Project) commenced in the reporting period and has continued at
pace throughout. When complete, the Project will produce copper concentrate from a 1 MTPA plant2. Project completion is scheduled for late April
2023, with plant mechanical completion to occur in March-April 2023. This target remains current despite logistical challenges associated with the
Ukraine war, constrained shipping availability and delayed project engineering. The Project is owned by Alara’s joint venture company Al Hadeetha
Resources LLC (AHRL) in which the Company holds a 51% interest.
At the date of this report a number of milestones have been achieved, including those detailed below.
Mining accommodation village
Construction of the Project accommodation village was completed in early calendar 20223. The prefabricated accommodation village is designed to
house 325 personnel from the construction, mining and plant operation crews. As construction crew accommodation requirements diminish, the camp
is being progressively retrofitted to house permanent mine and processing facility staff. The village is designed for a minimum life of 12 years. This is
comfortably above the current estimated Project life of 10.4 years, giving the Company increased flexibility should further copper discoveries be made
along the strike zone or in nearby areas.
Award of water supply and electricity agreements
In the December 2021 quarter, Alara awarded Oman National Engineering & Investment Co. (SAOG) (ONEIC) an engineering procurement and
construction (EPC) contract to design and install powerlines, transformers and a primary substation required to supply and distribute power to the
Project4.
In early calendar 2022, AHRL executed an agreement with Oman Water & Wastewater Services Company SAOC (OWWSC), to secure the process
water supply for the life of the Wash-hi Majaza Copper-Gold Project5. Under the agreement, OWWSC will provide daily water supply to AHRL’s
copper concentrator plant via its Sewage Treatment Plants (STPs), located in close proximity to the Project site. The water will be priced at a fixed
rate for the first five (5) years of the agreement. AHRL will invest in upgrading the capacity of one STP, located near the Al Mudhaibi township, to
1,800 cubic metres per day. Importantly, AHRL’s investment amount will be recovered over the life of the agreement via water charge discounts.
Mining and processing infrastructure procurement program materially advanced
As at the end of the reporting period, AHRL had an OMR 19m (AUD 71.38m) project finance facility from Sohar International Bank to fund Project
construction. AHRL commenced draw-down on the facility in the reporting period as it placed purchase orders with suppliers. These procurement
contracts saw AHRL contractually commit to a total capex of USD 54.55m (AUD 79.14m) by the end of the reporting period.
Several plant and equipment consignments crucial to Project completion arrived on site during and since the reporting period. Post reporting period
deliveries include the ball mill, LRS ball mill and SAG mill and crusher, representing a major milestone in Project development.
, in page
The full list of equipment purchases made, along with their delivery or expected delivery dates are shown in the table over the page.
2
Alara’s ASX Announcements dated 1 April 2016 (initial Definitive Feasibility Study results announcement), 24 January 2017 (DFS update), 28 June 2018 (NPV
update) and 29 March and 7 April 2021 (NPV updates) contain the information required by ASX Listing Rule 5.16 regarding the stated production target. All material
assumptions underpinning the production target as announced on those dates continue to apply and have not materially changed, except to the extent that a
relevant assumption in an earlier announcement listed above has been updated by an assumption in a later announcement in that list.
3
See Alara’s 27 January 2022 ASX announcement.
4
See Alara’s 15 November 2021 ASX announcement.
5
See Alara’s 20 January 2022 ASX announcement.
Directors’ Report
Alara Resources Annual Report 2022
32
Directors’ Report
Alara Resources Annual Report 2022
33
Definitive Feasibility Study (DFS)
The Project DFS financial modelling was revised in the previous year6 to take account of a copper price rise since the first revision in 2018. Revised
DFS projected returns, based on a range of copper price scenarios as at 29 March 2021 are set out in the table below. As a comparison, the LME
spot copper price on 19 September 2022 was USD 7870 per tonne:
Copper Price (USD/tonne)
7,000
7,500
8,000
8,500
9,000
9,500
Revenue (USD m)
569
604
639
674
709
743
EBITDA (USD m)
208
241
273
306
338
370
Project NPV (USD m)
54
71
88
104
121
137
Project IRR
24%
29%
33%
36%
40%
43%
Key Project parameters
Key Project parameters from the revised DFS are set out below:
Parameter
Fundamentals
Total pre-production capex
USD 60m (including EPC, Project Management, STP & pipeline, power, road and
contingencies)
Mining method
Open pit, 10.4 years
Project construction
15 months
First production
Q2 calendar 20237
Final production
2033
Processing rate
1 Mtpa
Average annual concentrate production
35,000 (wmt)
Total tonnes copper metal production
79,297 (t)
Total gold ounces
21,825 (oz)
Unit operating costs
USD 31.2/t of processed material
Project Engineering and Construction Materially Progressed
Plant site civil works on track
Civil works progressed according to schedule in the reporting period and have ramped to date. By the end of the reporting period, major cut and fill
works were near complete at the primary crusher house, belt conveyor area and crushed ore stockpile area, opening the way for the civil works
commencement at the front end of the plant, under the Project plan.
Plain concrete pouring was completed for the crushed ore stockpile and belt conveyors BC – 02 and 03. Reinforcement work is now underway at
both areas and reinforced concrete pouring is commencing at the date of this report.
Bulk earth works nearing completion
The bulk earth works (BEW) central to initial Project plant are now nearing completion. The remaining focus of BEW – the crusher building and
retaining-wall site development and excavation works – are well advanced. Excavations are scheduled to reach the foundation level shortly,
commencing with plain cement concrete pouring. The completion of the BEW will enable other critical civil and concrete works to commence at the
site. The ROM pad, where ore will be dumped to feed the processing plant, and accessway are complete.
Primary Electrical Sub-Station Excavation and Power Line Construction
The primary power sub-station and power-line contractor completed mobilisation in the last quarter of the reporting period, commenced foundation
ground marking and completed excavation for the capacitor bank foundation after securing required licenses. The power contractor also commenced
feeder pole pit excavation, dressing and erection, in addition to soil investigation for tower location.
Al Wash-hi pit pre-stripping progress
Development of the Wash-hi–Majaza pit has significantly advanced, with further removal of overburden and oxide ore and bench development work
undertaken over the second half of the reporting period. The total excavated volume at the end of the reporting period was 633,000m3.
Customs’ duty waiver delivers capital cost saving to Al Wash-hi Project
Since the reporting period the Government of Oman exempted the Project from customs duty on imported equipment and components of the
concentrator plant arriving at Omani ports8. This duty exemption was another example of the ongoing support which the Project is receiving from all
Government authorities and agencies in the Sultanate. The waiver will benefit the Project as a capital cost saving and reduce the time associated
with the customs clearance process at port.
6
See Alara’s 29 March and 7 April 2021 ASX announcements.
7
Revised from Q4 calendar 2022 as a result of a Project schedule review. See Alara’s 6 June 2022 ASX announcement.
8
See Alara’s 11 July 2022 ASX Announcement.
Directors’ Report
Alara Resources Annual Report 2022
34
Project engineering ramps up
Project engineering work continued at pace as procurement order placements continued to occur. Planned engineering was progressed rapidly by
Debisikha Associates and Progesys, with 63% of planned detailed engineering work completed by the end of the reporting period. Progress until that
time is shown in the following figure.
Project engineering milestones continue to be achieved
Mining Contractor
Al Hadeetha Resources LLC (AHRL) entered a preliminary commercial agreement with Alara Resources LLC (ARL) for ARL to perform mining
services for AHRL over 10 (ten) years at a cost of approximately USD 126m (AUD 167.83m). Of that amount, approximately USD 6m (AUD 7.99m)
will be classified, when incurred, as capital expenditure – with the remainder to be classified as expenditure on revenue account.
Alara Resources LLC (ARL)
ARL has two drill rigs and associated accessories and is seeking mineral drilling contract work. In 2019, prior to the COVID-19 outbreak, the Omani
Public Authority for Mining (PAM) released plans to award 110 new multi-commodity exploration and mining licences in the country.9 Mineral
exploration activity in Oman was negatively impacted by the pandemic. As the vaccinated percentage of the local population rises, activity in this
sector is expected to ramp up. ARL is targeting a number of drilling contracts which are becoming available over the coming months.
ARL’s first mining contract is with AHRL, as detailed above.
Mineral Tenements
The current status of all mineral tenements and applications for the Al Hadeetha Project is presented below.
Licence Name
Licence Owner
Alara JV
Interest
Exploration Licence
Mining Licence within EL
Area
Grant Date
Expiry Date
Status
Area
Date of Application
Status
Wash-hi – Majaza
ML 10003075.
Al Hadeetha
Resources LLC
51%
39km2
Jan 2008
Nov 2016
Active*
3km2
2013
Active
Mullaq
Al Hadeetha
Resources LLC
51%
41km2
Oct 2009
Nov 2016
Active*
1km2
Jan 2013
Pending
Al Ajal
Al Hadeetha
Resources LLC
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%: Al Tamman Trading Establishment LLC – 50%, of Daris Resources LLC (DRL))
The Daris project comprises two high-grade copper deposits within the 587km² exploration licence, which includes two mining licence applications
covering 4.5km². This project fits well with Alara’s preferred “hub and spoke” model, which provides for the processing of Daris ore at the Wash-hi –
Majaza copper concentration plant currently under construction.
The Daris East Mining Licence application, which covers an area that includes measured, indicated and inferred JORC copper resources10, 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
now underway at the Ministry of Energy and Minerals and survey work has been proposed to resolve the objection from the Ministry.
The Daris 3A5 Mining Licence application is progressing with the Government.
Awtad Copper-Gold Project
Oman
9
See for example http://www.tradearabia.com/news/IND_351573.html.
10
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, pp 14-45 and 72-73.
Directors’ Report
Alara Resources Annual Report 2022
35
(Alara right to subscribe for 10% initially with subsequent earn in up to 70%+; existing local shareholders holding the balance of Awtad Copper LLC)
The Awtad Project comprises an area of approximately 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 (potentially increasing up to 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 some undertaken across 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 prospects of further copper mineralisation.
Detailed work plans have been submitted to the Ministry of Energy and Minerals for renewal of the exploration licence, which currently remain pending.
Mineral Tenements
The current status of all mineral tenements and applications for the Daris and Awtad Projects is presented below.
Block Name
Licence
Owner
Alara JV
Interest
Exploration Licence
Mining Licences within EL
Area
Grant Date Expiry Date
Status
Area
Date of
Application
Status
Block 7
Al Tamman
Trading and
Est. LLC
50%
587km2
Nov 2009
Feb 2016
Active*
Daris 3A5 &
East
Resubmitted
2018
Pending
Block 8
Awtad
Resources
LLC
10% (earn
in to 70%)
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 Exploration Licence Bid
Saudi Arabia
The end-target for the Khnaiguiyah Project is the development and operation of an open-cut zinc-copper mine and associated infrastructure. Alara
previously invested over USD 30m into the original Khnaiguiyah Project, including over USD 23m (AUD 30.64m) to produce a bankable feasibility
study (BFS).
The project reached an impasse after the former Khnaiguiyah mining licence holder, United Arabian Mining Company LLC, asked the Saudi Arabian
Mines Minister to halt transfer of the licence to the Alara JV company, contrary to the requirements of the JV agreement. The mining licence was
cancelled in 2015, due to the impasse between project participants.
In early calendar 2022, the Saudi Ministry of Industry and Minerals Resources (MIMR) unveiled plans to undertake a 3-stage auction process for an
exploration licence for the Khnaiguiyah Zinc-Copper project (Licence). The project was be tendered as an exploration licence, covering an area of
353.8km2, which included the licence area of Alara’s earlier JV. The tender process had three stages, starting with registration of interest, followed
by a qualification stage and finally bidding and grant.
Alara formed a JV with Omani conglomerate Al Tasnim to bid for the Licence (Alara – AT JV). The Alara – AT JV bid progressed through the first
and second rounds of the tender process to be one of only three bidders selected to participate in the final, multi-round auction stage.
After the reporting period, the MIMR announced that the Alara – AT JV was unsuccessful in the Licence auction, having placed the second-highest
bid. This second placing gives the JV the status of “reserved bidder” under the Licence issue procedure. This means that if MIMR negotiations with
the winning bidder fail to progress to the Licence-issue stage, it will commence negotiations to issue it to the Alara – AT JV.
Statutory Information
Corporate
Alara is a company limited by shares incorporated in Western Australia.
Cash Position
The Company’s cash position at 30 June 2022 was AUD 2.45m (30 June 2021: AUD 4.24m).
Finance
Other than the project finance facility referred to above, and an ARL drill-rig finance facility of OMR 180,599 (AUD 623,156) neither the Company nor
any of its related entities were party to any material financing arrangements during the reporting period.
Directors’ Report
Alara Resources Annual Report 2022
36
Principal Activities
The principal activities of entities within the Consolidated Entity during the year were the exploration, evaluation and development of a mining licence
and 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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Directors’ Report
Alara Resources Annual Report 2022
37
Operating Results
Consolidated
2022
2021
$
$
Total revenue
11,169
11,779
Total expenses
(1,607,237)
(1,682,250)
Profit/loss before tax
(1,596,068)
(1,670,471)
Income tax benefit
-
-
Profit/loss after tax
(1,596,068)
(1,670,471)
Profit/(Loss) per Share
Consolidated
2022
2021
Basic profit/(loss) per share (cents)
(0.19)
(0.24)
Diluted profit/(loss) per share (cents)
(0.19)
(0.24)
Weighted average number of ordinary shares outstanding during the year used in the
calculation of basic loss per share
705,429,239
667,645,289
Weighted average number of ordinary shares outstanding during the year used in the
calculation of diluted loss per share
705,938,403
667,645,289
Cash Flows
Consolidated
2022
2021
$
$
Net cash flow used in operating activities
(1,811,168)
(1,654,849)
Net cash flow from investing activities
(17,590,507)
(3,165,710)
Net cash flow provided by financing activities
17,359,449
1,893,538
Net change in cash held
(2,042,226)
(2,927,021)
Effect of exchange rates on cash
250,202
(505,780)
Cash held at year end
2,449,791
4,241,815
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Directors’ Report
Alara Resources Annual Report 2022
38
Financial Position
Outlined below is the Consolidated Entity’s financial position and prior-year comparison.
Consolidated Entity
2022
2021
$
$
Cash
2,449,791
4,241,815
Trade and other receivables
9,712,513
38,566
Exploration & evaluation
5,635,650
4,910,968
Mine properties & development assets
25,213,324
12,383,033
Investment in associate
98,920
139,350
Term deposits
1,036,625
1,030,168
Other current assets
194,451
23,869
Non-current assets
645,927
553,469
Total assets
44,987,201
23,321,238
Trade and other payables
3,795,185
988,405
Unearned Income
-
8,079
Financial liabilities
18,151,549
723,128
Provisions
154,427
93,838
Total liabilities
22,101,161
1,813,450
Net assets
22,886,040
21,507,788
Issued capital
68,233,860
68,233,860
Reserves
12,469,929
9,495,609
Accumulated losses
(57,378,975)
(56,062,753)
Parent interest
23,324,814
21,666,716
Non-controlling interest
(438,774)
(158,928)
Total equity
22,886,040
21,507,788
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:
Fully paid shares quoted on
ASX
Listed options
Unlisted options
Total
705,429,239
-
7,499,000 712,928,239
Total
705,429,239
-
7,499,000
712,928,239
4,000,000 unlisted options held by Chairman Mr. Stephen Gethin with an exercise price of $0.03 per share were exercised on 1 July 2022.
Unlisted Options
During the financial year, the following unlisted options were issued:
1,666,000 options were issued to Managing Director Atmavireshwar Sthapak on 23 December 2021. Each option is exercisable over one
fully paid, ordinary, share in the Company and has an exercise price of AUD 0.03 per share. The options expire on 30 April 2024.
2,500,000 options were issued to Managing Director Atmavireshwar Sthapak on 23 December 2021. Each option is exercisable over one
fully paid, ordinary, share in the Company and has an exercise price of AUD 0.03 per share. The options expire on 30 June 2024.
3,333,000 options were issued to Managing Director Atmavireshwar Sthapak on 23 December 2021. Each option is exercisable over one
fully paid, ordinary, share in the Company and has an exercise price of AUD 0.03 per share. The options expire on 31 July 2024.
Likely Developments and Expected Results
During the 2022-23 financial year the Consolidated Entity intends to progress the construction mining and copper processing infrastructure for the Al
Wash-hi – Majaza Project, with completion expected in April 2023. Upon project completion, the Company will commence the production and sale of
copper and gold from the mine. Financial projections for the Al Hadeetha Project are set out on page 3 of this Report.
The Company intends to continue exploration, evaluation and development activities in relation to its other mineral exploration licences in Oman in
the 2022-23 financial year. The likely results of these activities will depend on a range of geological, technical and economic factors.
The Company will continue to pursue opportunities to realise value from the Khnaiguiyah Project bankable feasibility study.
Directors’ Report
Alara Resources Annual Report 2022
39
Environmental Regulation and Performance
The Consolidated Entity holds licences and abides by laws and regulations issued by the Omani government and its relevant mining and
environmental protection authorities. These licences, laws 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.
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
Non-Executive Chairman
Barrister and Solicitor of the Supreme Court of Western Australia and of the High Court of Australia
Appointed Non-Executive Chairman on 2 July 2020
Appointed Non-Executive Director on 28 June 2020
Non-Executive Director from 11 January to 22 November 2019
Experience
Stephen Gethin is a highly regarded Director and Company Secretary with over 25 years’ experience in the provision of corporate legal advice and
contracting over 18 years’ experience in the provision of ASX-listed secretarial services in a range of industries, including resources, technology and
investments. Before founding a private legal practice in 2013, was General Counsel and Company Secretary of Strike Resources Limited (ASX:SRK)
and, earlier, served as General Counsel and Company Secretary at ERG Limited (ASX:ERG). Mr Gethin also advises 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
Managing Director
Bachelor of Applied Science and Master of Technology, Applied Geology
Appointed Managing Director on 28 July 2020
Appointed Executive Director on 3 February 2016
Previously Non-Executive Director (22 September 2015 to 3 February 2016)
Experience
Atmavireshwar Sthapak (MAusIMM) is a geologist specialising 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 – Majaza project in Oman and resource upgrade at the Wash-hi – Majaza and Daris copper-gold
deposits. He played key roles in the feasibility study and the grant of a mining license for the Wash-hi – Majaza project. Prior to joining 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
Vikas Jain
Non-Executive Director
MBA
Appointed 6 April 2016
Experience
Vikas Jain holds an MBA from the USA and has vast experience of over 20 years in the fields 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), which he
founded in 2006 and listed on the National Stock Exchange of India. Under his leadership and able guidance, SWPE has enjoyed rapid growth and
is a premier exploration company in India. Since its beginnings as a primarily a mineral exploration company, SWPE has progressively added coal
bed methane (CBM) exploration and production, aquifer mapping, HDD, geophysical logging, transportation and other geological activities to its range
of operations. SWPE has also ventured into 2D and 3D seismic acquisition and processing for oil field exploration services. SWPE was awarded a
contract for the first integrated 2D seismic acquisition, processing and exploration including drilling in coal block in India. Mr Jain also has extensive
experience in open-cut mining of various minerals and allied activities through his earlier involvement 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.
Directors’ Report
Alara Resources Annual Report 2022
40
Sanjeev Kumar
Non-Executive Director
MBA (Finance & Marketing), IMT Ghaziabad, India; BE (Metallurgy), VNIT Nagpur, India
Appointed 23 October 2020
Experience
Mr Kumar has extensive Australian and international business experience, with a specialisation in high-value asset finance lending.
He is currently a director of Tradexcel Global Pty Ltd, an Australian company which he co-founded in 2017. Tradexcel assists Australian and NZ
businesses to assess and expand into overseas markets; navigating entry barriers, providing regulatory clearance services, business strategy and
planning and local partnerships. His previous roles include Vice President at India Factoring and Finance Solutions (a subsidiary of Fimbank),
Associate Vice President at Tata Capital Financial Services, India, and Manager, Infrastructure Division at ICICI Bank Limited.
Other directorships in listed companies in past 3 years
Nil
Devaki Khimji
Non-Executive Director
Appointed 2 February 2022
Experience
Ms. Devaki Khimji is a result-oriented, self-motivated and resourceful Managing Director with a proven ability to develop, strengthen and maximise
company profitability and efficiency. She is experienced in leading and growing all aspects of a business to make it into a dynamic and progressive
organisation. She possesses excellent communication skills and is able to establish sustainable and profitable relationships with clients and suppliers
across the world.
Ms. Khimji has served as the Managing Director and Partner of India Circus Pvt. Ltd, a company dedicated to the online retail of lifestyle products in
India. Her business acumen and foresight were essential to India Circus’s launch and financial growth. She guided the brand through the market with
her management skills gained through previous endeavours.
She has also embarked on various successful entrepreneurial ventures and acquired an indispensable understanding of global markets, including
electronic commerce. With strong management skills, both traditional and technology specific, Ms. Khimji’s experience and proficiency have
channelled her businesses and aspirations in the right direction. Ms. Khimji combines her passion for fitness software with a keen business sense,
which has also made her one of the most successful entrepreneurs in the software industry. She is solely responsible for the smooth functioning of
all her companies’ projects and has pioneered many fitness club/gym management systems and ensured their successful implementation. An
authority on the functioning of fitness club software, she has been responsible for the strong financial success of all her companies.
Other directorships in listed companies in past 3 years
Nil
Farrokh Masani
Alternate Director
Appointed 2 February 2022
Experience
Mr Masani is an inspirational leader with over thirty (30) years of work and entrepreneurial experience in the ever-evolving construction industry. He
is an ambitious visionary with a strong track record of creating and growing businesses in a competitive environment, with commitment to the principles
of excellence through innovation and teamwork.
He has extensive commercial expertise and in-depth knowledge of civil construction, HVAC, plumbing, firefighting, electrical systems design and
project management. Possessing exceptional communication skills and firm arbitration tactics, he is a leader who is also known for attention to detail
and exemplary decision-making during times of high pressure.
Other directorships in listed companies in past 3 years
Nil
Company Secretary
Dinesh Aggarwal
Company Secretary
Dinesh Aggarwal FCPA, CA, CMA, FTI, DFP
Appointed 2 July 2020
Experience
Dinesh is a Chartered Accountant and CPA with over 20 years’ experience in accounting and tax, finance, and business management in senior
corporate positions, both in Australia and overseas. He is the founder and Managing Director of Fortuna Advisory Group, an expanding, multi-
disciplinary professional services group in Perth, Western Australia. He advises listed companies, Australian subsidiaries of major international
groups, a large variety of SMEs and high-net-worth individuals.
Mr Aggarwal provides virtual CFO services to numerous corporate groups, self-managed superannuation advice and complex business structuring.
He represents taxpayers in objections and AAT appeals against the ATO. Mr Aggarwal successfully represented a client in the landmark case
Wong v. Commissioner of Taxation (AATA2011/3450) concerning the distinction between a share trader and an investor. A highly acknowledged
professional, Dinesh has been Chairman of the CPA (WA) Public Practice Committee and a member of CPA Australia Public Practice Advisory
Committee.
Among his various awards, he received the CPA 40 Under 40 Young Business Leaders’ Award in 2012 and 2013 and was a finalist in the Tax
Institute of Australia SME Tax Adviser of the Year Award 2015. Mr Aggarwal also serves on the boards of various companies and not for profit
bodies.
Directors’ Report
Alara Resources Annual Report 2022
41
Directorships in listed companies in past 3 years
Nil
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:
Director
Ordinary shares
Options
Stephen Gethin
1,500,000
-
Atmavireshwar Sthapak
3,862,051
7,499,000
Vikas Jain
37,745,930
-
Sanjeev Kumar
-
-
Devaki Khimji
-
-
Farrokh Masani
10,422,687
-
Directors’ Meetings
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:
Director Name
Appointed / Ceased
Board
Audit Committee
Remuneration and
Nomination Committee
Meetings
Attended
Maximum
Possible
Meetings
Attended
Maximum
Possible
Meetings
Attended
Maximum
Possible
Stephen Gethin
Appointed 28 June 2020
13
13
2
2
-
-
Atmavireshwar Sthapak
Appointed 22 September 2015
13
13
2
2
-
-
Vikas Jain
Appointed 6 April 2016
13
13
2
2
-
-
Sanjeev Kumar
Appointed 23 October 2020
9
13
-
-
-
-
Devaki Khimji
Appointed 2 February 2022
0
4
-
-
-
-
Farrokh Masani
Appointed 2 February 2022
1
4
-
-
-
-
Audit Committee
The Audit Committee currently comprises Non-Executive Directors Vikas Jain (Committee Chairman) (appointed 6 April 2016) Non-Executive
Company Chairman Stephen Gethin (appointed 2 July 2020) and Managing Director Atmavireshwar Sthapak (appointed 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.
Material Business Risks Affecting Company Results
Alara operates in an uncertain economic environment as it seeks to achieve results consistent with its strategic objectives. Its financial results are
subject to various risks and uncertainties, many of which are beyond the Company’s ability to control. Alara’s Board and management identifies and
monitors risks and, where possible, manages the potential for adverse outcomes through the implementation of controls and mitigation strategies.
All of the following factors may have a material adverse effect on the Company's business, may affect the results of the Company’s operations and
affect its prospects for future years.
COVID-19
The potential for a future significant outbreak of COVID-19 amongst the workforce of the Company or its construction and mining contractors and
subcontractors poses a risk to the Company’s operations. A significant COVID-19 outbreak on the Company’s mining construction project could lead
to a delay in completion of the project and/or a delay in mining ore (already underway) due to increased personnel absences. A significant COVID-
19 outbreak affecting the Company’s operations may require additional measures to be taken, which may themselves also contribute to delay in
project completion and/or in mining ore. To mitigate this risk, the Company has implemented a comprehensive set of controls to ensure the health of
its employees. Any measures taken to address COVID-19 may increase the Company’s unit operating costs when it commences production of copper
concentrate.
Commodity Prices
The Company is a minerals explorer and is developing a copper-gold mine in Oman. Upon completion of the Company’s copper-gold mine in Oman,
it aims to generate revenue from the sale of copper concentrate and gold through a customer offtake agreement. Commodity prices are determined
by external markets, which are beyond the control of the Company and are susceptible to adverse price movements.
Foreign Exchange
The Company’s 51% owned joint-venture vehicle Al Hadeetha Resources (AHRL) has a loan facility of OMR 19 million (AUD 67.76 million) (Facility)
which it is drawing down to fund construction of the Al Wash-hi – Majaza Copper-Gold project in Oman (Project). This loan is partly denominated in
Omani rials and partly in US dollars.
The Company intends to repay the Facility with the proceeds of the sale of copper concentrate to be generated from the Project, when construction
is complete. The sale contract for AHRL’s copper concentrate is expected to be denominated in US Dollars. Although the Omani rial is currently
pegged to the US dollar, it is possible that it will not remain pegged at all in future, or that it will be pegged at a different rate. Any change to the
Directors’ Report
Alara Resources Annual Report 2022
42
exchange rate between the Omani rial and the US dollar could affect the Company’s ability to repay the Facility and its profitability. The Company
has not hedged against this risk, however, because it has taken the view that it is unlikely that the Omani rial will cease to be pegged to the US dollar,
or that it will be pegged at a substantially different rate, during the anticipated 10-year life of the Project.
The Company reports to shareholders in Australian dollars. A fall in the US dollar against the Australian dollar would result in a reduction in the profit
which the Company expects to earn, when expressed in Australian dollars. The Company has not hedged against fluctuations in the AUD:USD
exchange rate, however, as the great majority of its costs are denominated in US dollars, the same currency in which it expects to earn revenue.
Production, Operating and Capital Costs
The Company’s current and future operating results and financial position are dependent on the level of mineral output achieved, as well as on the
results of operations and capital costs. The Company’s forecast levels of copper concentrate production are subject to alteration as a result of a
number of factors, including the actual geological and metallurgical properties of ore from the mine being different to that predicted by its feasibility
study, and severe adverse weather events. As part of Project construction, the Company is building appropriate levels of resistance to adverse
weather events into plant and equipment, and implementing systems to deal with the consequences thereof, for example mine dewatering systems.
When the Project commences production the Company will operate it using the services of a mining contractor. The main expenses of the mining
contractor are fuel costs, labour costs and equipment capital or rental costs and depreciation. The Company has a long-term, fixed-price contract
with its mining contractor. Therefore, it is largely protected against fluctuations in these costs.
The Company will be exposed to significant costs in relation to transporting copper concentrate from mine to port and shipping it to its end customers’
nominated ports overseas, principally in Asia. These costs are subject to fluctuation due to shortages in supply or production of shipping and fuel,
port congestion and general economic factors both in Oman and international geopolitical risks, including war.
Many of these factors are beyond the Company's control. As a result, the Company may face more diversified production, capital and operating costs
in the future than its current estimates of those costs.
Climate Change
The Company may be impacted by the emergence of new or expanded regulations, locally and internationally, relating to climate change. Changes
in local or international climate change regulations, mitigation efforts, specific taxes or penalties for carbon emissions, among other things, may affect
the projected profit of the Project.
The Company’s current mine-site construction operation, and its projected sale of copper concentrate are largely dependent on carbon-based energy
sources. Presently, all mining equipment used by its mining and civil earthworks contractors is diesel powered. The Company’s proposed source of
electricity for operating the Project is generated from carbon-based energy source. The Company’s proposed methods of transporting copper
concentrate from the Project, when complete, to port and on to customer destinations overseas all currently envisage the use of diesel-powered road
transport and ocean shipping which is still largely reliant on heavy fuel oil.
The Company’s costs of production and supplying product to customers may increase as a result of governmental and private industry efforts to
mitigate climate change which involve a change in the mix of energy sources which may be legally and/or economically used in mining and the
transport of mined product.
Climate change may pose certain physical and environmental risks which the Company cannot predict, including an increase in severe weather
events (such as heavier and/or longer rain storms). These climate-related risks may significantly alter the industry in which the Company operates.
In particular, the site of the Company’s activity in Oman is likely to be exposed to the longer-term physical effects of climate change, including but not
limited to increased average daily temperatures, rates of evaporation increases and increased flooding risk.
Transport and Infrastructure
The Company’s business depends on the continued flow of equipment deliveries for construction of mine site infrastructure, fuel for construction and
mining operations and explosives to it and its contractors, and will depend on transport logistics for the supply of copper concentrate to end customers
once the Project commences operation. The Company relies, and intends to rely when copper production commences, on third parties to provide
trucking, port, shipping and other transportation services. Contract disputes, port capacity issues, truck and vessel availability, weather issues, strikes,
labour shortages and travel restrictions related to COVID-19 or other factors may have an adverse effect on the Company’s capacity to ship (or
receive shipped products) and materials to meet Project construction schedule and its contractual commitments to sell copper concentrate, when it
commences production. In turn, such factors may affect the Company’s operations and hence its financial performance.
Geopolitical Risk
China is a major source of global demand for copper concentrate, the principal product which the Company plans to produce. The Company’s
exposure to economic conditions and policies in China is therefore substantial. If the Chinese economy experiences slower growth or declines, this
may lead to a reduction in the price of copper concentrate and/or the demand for it, thus reducing the Company’s expected sales and profits.
Other general geopolitical and global economic risks, the specific nature of which cannot be predicted with certainty, may affect the Company in
various ways if they materialise, including by affecting commodity prices, capital flows, macroeconomic indicators and general market confidence.
Licences, Permits and Approvals
In order to construct the Project and to operate it when construction is complete, the Company must comply with applicable environmental, mining
and dangerous goods laws and conditions of its mining licence. The Company has obtained necessary approvals to construct and operate the Project.
The Company has interests in other copper exploration projects in Oman. It has complied with all laws, and licenses which it holds, in relation to
those projects to date. To develop any of those projects beyond the exploration stage into mining projects, the Company will require additional permits
– principally mining licences. The Company will comply with all laws and procedures because of applying for and operating under any mining licences
in relation to any of its exploration projects if moving them to that stage would be economically viable. There is no guarantee, however, that mining
licences will be granted for any of the Company’s exploration projects.
Directors’ Report
Alara Resources Annual Report 2022
43
ALARA RESOURCES LIMITED
Page 15 of 50
2022 FULL YEAR REPORT
Information Technology and Cyber Security Risk
The Company’s operations are supported by information technology systems, including infrastructure, networks, applications and service providers.
The Company may experience network and system interference or disruption from a number of sources, including security breaches, cyberattacks
and system failures that may lead to interference or disruption of technological systems leading to downtime. Further, operational delays, destruction
or corruption of data, sensitive information disclosure and data breach could all have a material impact on the Company's business, operations,
financial position and performance. The Company has implemented cybersecurity measures to mitigate these risks, based on competent external
advice.
Remuneration Report
The information in this Remuneration Report has been audited. This Remuneration Report details the nature and amount of remuneration for each
Director and Company Executive (being the Company Secretary or a 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 2022.
Key Management Personnel
Directors
Stephen Gethin
Chairman (Appointed 2 July 2020. Non-Executive Director until 2 July 2020)
Atmavireshwar Sthapak
Managing Director (Appointed 28 July 2020. Executive Director until 28 July 2020)
Vikas Jain
Non-Executive Director (Appointed 6 April 2016)
Sanjeev Kumar
Non-Executive Director (Appointed 23 October 2020)
Devaki Khimji
Non-Executive Director (Appointed 2 February 2022)
Farrokh Masani
Alternate Director (Appointed 2 February 2022)
Executives
Dinesh Aggarwal
Company Secretary (Appointed 2 July 2020)
Avigyan Bera
AHRL CEO (Appointed 15 October 2020)
Remuneration and Nomination Committee
The Remuneration and Nomination Committee currently comprises Non-Executive Board Chairman, Stephen Gethin (Committee Chairman,
appointed 2 July 2020), Non-Executive Director, Vikas Jain (appointed 6 April 2016) and Managing Director Atmavireshwar Sthapak appointed 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, 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 Directors’ and Executive Directors’ remuneration is separate and distinct.
Directors’ 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.
Directors’ Report
Alara Resources Annual Report 2022
44
ALARA RESOURCES LIMITED
Page 16 of 50
2022 FULL YEAR REPORT
Structure
Each Non-Executive Director receives a fee for serving as a Director of the Company and on relevant Board Committees, if applicable. The level of
each Non-Executive Director’s fee is commensurate with the workload and responsibilities undertaken. According to the Company’s Constitution and
the ASX Listing Rules, the aggregate remuneration of Non-Executive Directors must not exceed an amount determined by the Shareholders from
time to time at a General Meeting (Non-Executive Fee Pool). An amount up to the Non-Executive Fee Pool is then allocated among the Non-
Executive Directors as Directors’ fees, as determined by the Board on the recommendation of the Remuneration and Nomination Committee
(Remuneration Committee). The Non-Executive Fee Pool, set by Shareholders at the Annual General Meeting held on 26 May 2011, is AUD
275,000 per annum. Shareholders determined the amount of the Non-Executive Fee Pool having regard to the recommendation of the Board. That
recommendation was, in turn, based on the recommendation of the Remuneration Committee, made based on a consideration of fees paid to non-
executive directors of comparable companies.
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 creation of value for shareholders, the Board had regard to the following information in relation to the
current financial year and the previous four years:
2022
2021
2020
2019
2018
Total Equity (AUD)
22.9
21.5m
22.9m
21.8m
10.4m
Basic earnings/(loss) per share (AUD)
(0.19)
(0.24)
0.04
(0.07)
(0.11)
Net Profit/(Loss) attributable to members (AUD)
(1,316,222)
(1,622,329)
273,985
(454,577)
(691,512)
Market Capitalisation (AUD)
31.0m
9.9m
8.3m
15.1m
18.2m
Fixed Remuneration
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. Current Managing Director Atmavireshwar Sthapak (appointed 28 July 2020) was paid allowances including
housing and vehicle allowances and medical insurance.
Special Exertions and Reimbursements
Pursuant to the Company’s Constitution, each:
Non-Executive Director is entitled to receive payment for the performance of extra services, or the undertaking of special exertions, at the request
of the Board for Company purposes.
Each Director is entitled to reimbursement of all reasonable expenses (including traveling and accommodation) which they incur for the purpose
of attending Board and Board Committee meetings, the business of the Company, or in performing their duties as a Director.
Post-Employment Benefits
Other than employer contributions to nominated complying superannuation funds (where applicable) and entitlements to accrued unused annual and
long service leave (where applicable) the Company does not provide retirement benefits to Key Management Personnel.
The Company notes that Shareholders’ 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 three (3) years) to a Director or any person
who holds a managerial or executive role.
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]
Directors’ Report
Alara Resources Annual Report 2022
45
Details of Remuneration Provided to Key Management Personnel.
Key
Management
Person
Perfor-
mance
based
Fixed
At risk
STI
Options
related
Short-term benefits
Post-employment
benefits
Other long-
term benefits
Equity
based
benefits
Total
Cash payments
Non-
cash(ii)
Other(iii)
Super-
annuation
Termi-
nation
Other
Options
Salary
and fees
Allo-
wances(i)
Cash
Bonus
2022
%
%
%
%
$
$
$
$
$
$
$
$
$
$
Executive Director:
Atmavireshwar
Sthapak
-
100%
-
-
290,633
27,973
-
-
-
-
-
23,204
-
341,810
Non-Executive Directors:
Stephen Gethin
-
100%
-
-
75,000
-
-
-
-
-
-
-
-
75,000
Vikas Jain
-
100%
-
-
50,000
-
-
-
-
-
-
-
-
50,000
Sanjeev Kumar
-
100%
-
-
22,831
-
-
-
-
2,170
-
-
-
25,001
Devaki Khimji
-
-
-
-
-
-
-
-
-
-
-
-
-
Farrokh Masani
-
-
-
-
-
-
-
-
-
-
-
-
-
Company Secretary:
Dinesh Aggarwal
(iv)
-
100%
-
-
39,105
-
-
-
-
-
-
-
-
39,105
Chief Executive Officer, AHRL
Avigyan Bera
-
100%
-
-
66,757
22,669
-
-
-
-
-
-
-
89,425
Notes:
(i)
Allowances are based on the executive employment agreement and may include expat allowance,
company car allowance, rent allowance and security bond and school-fee allowance received
from subsidiaries and related joint venture entities.
(ii)
Non-cash benefits include net leave and/or end of service gratuity accrued or paid to relevant
labour laws
(iii)
Other short-term benefits consist of exchange gain/(loss) due to foreign currency translation
from Omani Rial to Australian Dollars on Mr. Bera’s salary.
(iv) Appointed 2 July 2020. Remuneration, in his capacity as Company Secretary, paid to
Fortuna Advisory Group.
Key Management
Person
Perfor-
mance
based
Fixed
At risk
STI
Options
related
Short-term benefits
Post-employment
benefits
Other long-
term benefits
Equity
based
benefits
Total
Cash payments
Non-
cash(ii)
Other(iii)
Super-
annuation
Termi-
nation
Other
Options
Salary
and fees
Allo-
wances(i)
Cash
Bonus
2021
%
%
%
%
$
$
$
$
$
$
$
$
$
$
Executive Directors:
Justin Richard
-
100%
-
- 421,089
10,284
-
-
-
-
-
-
-
431,373
Atmavireshwar Sthapak
-
100%
-
- 255,283
25,372
-
-
-
-
-
-
-
280,655
Non-Executive Directors:
James Phipps
-
100%
-
- 157,087
-
-
-
-
-
-
-
-
157,087
Vikas Jain
-
100%
-
-
50,000
-
-
-
-
-
-
-
-
50,000
Stephen Gethin
-
100%
-
-
50,000
-
-
-
-
-
-
-
-
55,000
Avi Sthapak
-
100%
-
-
9,132
-
-
-
-
868
-
-
-
10,000
Sanjeev Kumar
-
100%
-
-
17,304
-
-
-
-
1,446
-
-
-
18,750
Company Secretary:
Dinesh Aggarwal(v)
-
100%
-
-
39,105
-
-
-
-
-
-
-
-
39,105
Chief Executive Officer, AHRL
Avigyan Bera
-
100%
-
-
54,029
14,887
-
-
-
-
-
-
-
68,916
Notes:
(i)
Allowances are based on the executive employment agreement and may include expat allowance, company
car allowance, rent allowance and security bond and school-fee allowance received from subsidiaries and
related joint venture entities.
(ii)
Non-cash benefits include net leave and/or end of service gratuity accrued or paid to relevant labour laws
(iii)
Other short-term benefits consist of exchange gain/(loss) due to foreign currency translation
from Oman Rial to Australian Dollars on Mr Richard’s and Mr. Bera’s salaries.
(iv) The amount paid to Mr. Richard included termination benefits of AUD 391,328.
(v)
Appointed 2 July 2020. Remuneration, in his capacity as Company Secretary, paid to Fortuna
Advisory Group.
Directors’ Report
Alara Resources Annual Report 2022
46
Equity Based Benefits
The Company provided the equity based benefits (e.g. grant of shares or options) to Key Management Personnel during the financial year specified
below. No shares were issued as a result of the exercise of options held by Key Management Personnel during the financial year.
1,666,000 options were issued to Managing Director Atmavireshwar Sthapak on 23 December 2021. Each option is exercisable over one fully
paid, ordinary, share in the Company and has an exercise price of AUD 0.03 per share. The options expire on 30 April 2024.
2,500,000 options were issued to Managing Director Atmavireshwar Sthapak on 23 December 2021. Each option is exercisable over one fully
paid, ordinary, share in the Company and has an exercise price of AUD 0.03 per share. The options expire on 30 June 2024.
3,333,000 options were issued to Managing Director Atmavireshwar Sthapak on 23 December 2021. Each option is exercisable over one fully
paid, ordinary, share in the Company and has an exercise price of AUD 0.03 per share. The options expire on 31 July 2024.
Options Lapsed During the Year
5 million held by Managing Director Mr. Atmavireshwar Sthapak were cancelled during the year with his consent, as a condition of the options referred
to above being issued to him.
Details of Shares Held by Key Management Personnel
2021-2022
Ordinary Fully Paid Shares
Balance at
1 July 2021
Balance at
appointment
Net change
Balance at
cessation
Balance at
30 June 2022
Director/KMP
Stephen Gethin
-
-
-
Atmavireshwar Sthapak
3,862,051
-
3,862,051
Vikas Jain
37,745,930
-
37,745,930
Sanjeev Kumar
-
-
-
-
Dinesh Aggarwal
6,055,725
-
-
6,055,725
Devaki Khimji
-
-
-
Farrokh Masani
10,422,687
-
10,422,687
2020-2021
Ordinary Fully Paid Shares
Balance at
1 July 2020
Balance at
appointment
Net change
Balance at
cessation
Balance at
30 June 2021
Director/KMP
Stephen Gethin
-
-
-
Atmavireshwar Sthapak
2,951,451
910,600
3,862,051
Vikas Jain
37,745,930
-
37,745,930
Sanjeev Kumar
-
-
-
Dinesh Aggarwal
-
6,055,725
6,055,725
James Phipps
-
-
-
Justin Richard
35,319,526(i)
-
35,319,526(i)
Avi Sthapak
-
-
-
Note:
(i) Includes shares held by Mr Richard’s spouse.
Details of Options Held by Key Management Personnel
The only options held by Key Management Personnel are those disclosed above under the heading “Equity Based Benefits”
Employment Contracts
(a)
Managing Director – Atmavireshwar Sthapak
Atmavireshwar Sthapak was appointed Managing Director on 27 July 2020. The material terms of his contract in effect during the Reporting Period
were as follows11:
Annual base salary of AUD 324,278 per annum;
Housing allowance of up to AUD 41,406 per annum;
Vehicle allowance – up to AUD 77,637 per annum, plus pay the costs of keeping the vehicle fuelled, maintained and registered;
Compulsory statutory “end of service” payments due under the Oman Labour Law;
Standard annual leave (20 days) and personal/sick leave (10 days paid) entitlements plus any additional entitlements prescribed under Oman
Labour Law; and
Either party may terminate the agreement by providing three (3) months’ notice.
Long-term incentive: The Managing Director’s Options, as detailed on page 19, form part of his long-term incentive. In addition, the Managing
Director is entitled to a cash bonus specified below if the Company achieves the relevant target for that bonus (each a Target) by the Target
Date for that Target specified below:
11
See Alara’s 3 February 2016 ASX Announcement: “Appointment of Executive Director”.
Directors’ Report
Alara Resources Annual Report 2022
47
o
AUD 60,000 cash bonus if the Wash-hi – Majaza Project achieves first copper concentrate production on or before 28 February 2023
(Target Date).
o
AUD 60,000 cash bonus if Alara or a JV company in which Alara has at least a 50% interest is awarded a mining or exploration licence
for the Khnaiguiyah Project in Saudi Arabia on or before 31 March 2023 (Target Date).
o
AUD 20,000 cash bonus if the exploration license for the Daris project is transferred to Alara’s JV company Daris Resources LLC by
Alara's partner in that JV (Target) on or before 31 December 2022 (Target Date).
o
AUD 20,000 cash bonus if Alara or a JV company in which Alara holds at least a 50% interest acquires interests in other copper mineral
licences in Oman acceptable to the Board (Target) on or before 31 December 2022 (Target Date).
o
AUD 20,000 cash bonus if the exploration license for mining Block 8 in Oman is renewed and is transferred to Alara or a JV company in
which Alara holds at least a 10% interest (Target) on or before 31 March 2023 (Target Date).
In each of the above cases, if the Target is:
o
achieved within two (2) months after the Target Date, 66.66% of the cash bonus is payable for that Target;
o
achieved more than (2) months after, but within four (4) months of, the Target Date, 33.33% of the cash bonus is payable for that Target;
or
o
not achieved within four (4) months after the Target Date, no cash bonus is payable for that Target.
(b)
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 reporting period are as follows:
Key Management Personnel
and Position(s) Held
Relevant Date(s)
Base Salary/Fees per annum
Other Key Terms
Stephen Gethin
Chairman
2 July 2020
(Commenced)
AUD 75,000 plus GST per annum.
N/A
Dinesh Aggarwal
Company Secretary
The Company pays Fortuna Advisory Group AUD
110,400
as
a combined amount for
Company
Secretarial and Chief Financial Officer services. Mr
Aggarwal is a consultant to Fortuna Advisory Group
through Fortuna Accountants and Business Advisors,
of which he is Managing Director.
N/A
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.
Director’s Loan Agreements
There were no loan agreements with the Directors in effect 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 2021 Annual General Meeting
At the Company’s most recent (2021) Annual General Meeting (AGM), a resolution to adopt the 2021 Remuneration Report was put to a vote and
passed unanimously on a show of hands with the proxies received also indicating 99.43% support for adopting the Remuneration Report.12 No
comments were made on the Remuneration Report at the AGM.
Engagement of Remuneration Consultants
The Company did not engage a remuneration consultant during the year.
The Board has established a policy for engaging external remuneration consultants. The policy includes a requirement for the Remuneration and
Nomination Committee to:
approve all engagements of remuneration consultants;
12
See Alara’s 17 November 2017 ASX Announcement: “Results of Meeting”.
Directors’ Report
Alara Resources Annual Report 2022
48
receive remuneration recommendations from remuneration consultants (to the exclusion of persons not being members of the Committee)
regarding Key Management Personnel; and
ensure that the making of remuneration recommendations is free from undue influence by the member or members of Key Management
Personnel to whom the recommendation relates.
This concludes the audited Remuneration Report.
Other Statutory Disclosures
Directors’ and Officers’ Insurance
The Company insures Directors and officers against liability they may incur in respect of any wrongful acts or omissions made by them in such
capacity (to the extent permitted by the Corporations Act 2001) (D&O Policy). Details of the amount of the premium paid in respect of the D&O Policy
is not disclosed as such disclosure is prohibited under the terms of the policy.
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 and the Secretary (each an Officer) 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 (this Rothsay Audit & Assurance Pty Ltd for 30 June 2022 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
$
Fees for Other Non-Audit Services
$
Total
$
36,389
–
36,389
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 out on page 21.
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, 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
30 September 2022
Directors’ Report
Alara Resources Annual Report 2022
49
Director’s Report
Auditor’s Independence Declaration
Alara Resources Annual Report 2022
50
Note
2022
2021
$
$
Revenue
3
3,007
1,779
Other income
3
8,162
10,000
Gain/(Loss) on foreign exchange
3
54,239
(82,519)
Personnel
(765,089)
(1,097,128)
Occupancy costs
(45,548)
(39,216)
Finance expense
(13,811)
(8,070)
Corporate expenses
(189,453)
(55,640)
Administration expenses
(607,145)
(346,200)
Share of profit/(losses) of associates
11
(40,430)
(53,477)
PROFIT/(LOSS) BEFORE INCOME TAX
(1,596,068)
(1,670,471)
Income tax benefit
-
-
PROFIT/(LOSS) FOR THE YEAR
(1,596,068)
(1,670,471)
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations
2,974,320
(1,567,055)
Total other comprehensive income/(loss)
2,974,320
(1,567,055)
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR
1,378,252
(3,237,526)
Profit/(loss) attributable to:
Owners of Alara Resources Limited
(1,316,222)
(1,622,329)
Non-controlling interest
(279,846)
(48,142)
(1,596,068)
(1,670,471)
Total comprehensive income/(loss) for the year attributable to:
Owners of Alara Resources Limited
1,658,098
(3,189,384)
Non-controlling interest
(279,846)
(48,142)
1,378,252
(3,237,526)
Earnings/Loss per share:
Basic earnings/(loss) per share cents
6
(0.19)
(0.24)
Diluted earnings/(loss) per share cents
6
(0.19)
(0.24)
The accompanying notes form part of this consolidated financial statement.
Consolidated Statement of Profit or Loss and
Other Comprehensive Income
for the year ended 30 June 2022
Alara Resources Annual Report 2022
51
Note
2022
2021
$
$
CURRENT ASSETS
Cash and cash equivalents
7
2,449,791
4,241,815
Trade and other receivables
8
9,712,513
38,566
Other current assets
9
194,451
23,869
Financial assets
10
1,036,625
1,030,168
TOTAL CURRENT ASSETS
13,393,380
5,334,418
NON-CURRENT ASSETS
Financial assets
10
506,895
454,088
Investment in Associate
11
98,920
139,350
Borrowing costs
12
631
733
Property, plant and equipment
13
138,401
98,648
Mine properties and development assets
13
25,213,324
12,383,033
Exploration and evaluation
14
5,635,650
4,910,968
TOTAL NON-CURRENT ASSETS
31,593,821
17,986,820
TOTAL ASSETS
44,987,201
23,321,238
CURRENT LIABILITIES
Trade and other payables
15
3,795,185
988,405
Unearned income
16
-
8,079
Provisions
17
154,427
93,838
Financial liabilities
18
17,218
21,409
TOTAL CURRENT LIABILITIES
3,966,830
1,111,731
NON CURRENT LIABILITIES
Financial liabilities
18
18,134,331
701,719
TOTAL NON-CURRENT LIABILITIES
18,134,331
701,719
TOTAL LIABILITIES
22,101,161
1,813,450
NET ASSETS
22,886,040
21,507,788
EQUITY
Issued capital
19
68,233,860
68,233,860
Reserves
20
12,469,929
9,495,609
Accumulated losses
(57,378,975)
(56,062,753)
Parent interest
23,324,814
21,666,716
Non-controlling interest
(438,774)
(158,928)
TOTAL EQUITY
22,886,040
21,507,788
The accompanying notes form part of this consolidated financial statement.
Consolidated Statement of Financial Position
As at 30 June 2022
Alara Resources Annual Report 2022
52
Note
Issued Capital
Options
Reserve
Foreign Currency
Translation
Reserve
Accumulated
Losses
Transactions
with minority
interests
Non-
Controlling
Interest
Total
$
$
$
$
$
$
$
Balance as at 1 July 2020
66,340,323
-
2,468,811
(54,440,424)
8,593,853
(110,786)
22,851,777
Option expired
-
-
-
-
-
-
-
Foreign currency translation reserve
-
-
(1,567,055)
-
-
-
(1,567,055)
Net income and expense recognised directly in equity
-
-
(1,567,055)
-
-
-
(1,567,055)
Profit/(loss) for the year
-
-
-
(1,622,329)
-
(48,142)
(1,670,471)
Total comprehensive income/(loss) for the year
-
–
(1,567,055)
(1,622,329)
-
(48,142)
(3,237,526)
Transactions with owners in their capacity as owners:
Share placement
1,904,629
-
-
-
-
-
1,904,629
Share placement costs
(11,092)
(11,092)
Balance as at 30 June 2021
68,233,860
-
901,756
(56,062,753)
8,593,853
(158,928)
21,507,788
Balance as at 1 July 2021
68,233,860
-
901,756
(56,062,753)
8,593,853
(158,928)
21,507,788
Options expired
-
-
-
-
-
-
-
Foreign currency translation reserve
-
-
2,974,320
-
-
-
2,974,320
Net income and expense recognised directly in equity
-
-
2,974,320
-
-
-
2,974,320
Profit/(Loss) for the year
-
-
-
(1,316,222)
-
(279,846)
(1,596,068)
Total comprehensive income/(loss) for the year
-
–
2,974,320
(1,316,222)
-
(279,846)
1,378,252
Transactions with owners in their capacity as owners:
Share placement
19
-
-
-
-
-
-
-
Share placement costs
19
-
-
-
-
-
-
-
Balance as at 30 June 2022
68,233,860
-
3,876,076
(57,378,975)
8,593,853
(438,774)
22,886,040
The accompanying notes form part of this consolidated financial statement.
Consolidated Statement of Changes in Equity
for the year ended 30 June 2022
Alara Resources Annual Report 2022
53
Note
2022
2021
$
$
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers/others
-
10,000
Payments to suppliers and employees (inclusive of GST)
(1,098,986)
(1,666,486)
Payments to employees
(712,970)
-
Interest received
788
1,637
NET CASHFLOWS USED IN OPERATING ACTIVITIES
7b
(1,811,168)
(1,654,849)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for plant and equipment
(65,823)
(13,249)
Payments for development and exploration expenditure
(17,470,734)
(2,120,568)
Payments towards term deposits
(2,001)
(1,031,893)
Loan to other entity (repayment)
(51,949)
-
NET CASHFLOWS USED IN INVESTING ACTIVITIES
(17,590,507)
(3,165,710)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuing ordinary shares
-
1,904,629
Proceeds from borrowings
17,359,449
Cost of issuing ordinary shares
-
(11,091)
NET CASHFLOWS PROVIDED BY FINANCING ACTIVITIES
17,359,449
1,893,538
NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS HELD
(2,042,226)
(2,927,021)
Cash and cash equivalents at beginning of the financial year
4,241,815
7,674,616
Effect of exchange rate changes on cash
250,202
(505,780)
CASH AND CASH EQUIVALENTS AT THE END OF THE FINANCIAL YEAR
7
2,449,791
4,241,815
The accompanying notes form part of this consolidated financial statement.
Consolidated Statement of Cash flows
for the year ended 30 June 2022
Alara Resources Annual Report 2022
54
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 Consolidated Entity incurred a loss for the year ended 30 June 2022 of AUD 1,596,068 (2021: Loss AUD 1,670,471) and cash inflows/(outflows)
from operating and investing activities of (AUD 19,401,675) (2021: AUD 4,820,559). As at 30 June 2022 the Group has a cash at bank balance of
AUD 2,449,791 (2021: AUD 4,241,815) and bank deposits of AUD 1,047,144 (2021: AUD 1,039,829) and working capital of AUD 9,426,550 (2021:
AUD 4,222,688).
The Directors have prepared a cash flow forecast, which indicates that the Consolidated Entity 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 2022 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.
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
55
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
The Group has applied AASB 16 that is effective for annual periods that begin on or after 1 January 2019. AASB 16 introduced 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.
1.6.
Comparative Figures
Certain comparative figures have been adjusted to confirm 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 Wash-hi – Majaza 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 profit or loss.
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.
Share-based payment 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 accounting estimates have no impact on the carrying amounts of assets and
liabilities but will impact expenses and equity.
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
56
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.
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 2022.
2022
2021
$
$
Statement of Financial Position
Current assets
1,350,948
1,824,466
Non-current assets
9,502,972
9,350,648
Total assets
10,853,920
11,175,114
Current liabilities
326,261
162,166
Non-current liabilities
4,793
11,026
Total liabilities
331,054
173,192
Net assets
10,522,866
11,001,922
Issued capital
68,233,860
68,233,860
Accumulated losses
(57,710,994)
(57,231,938)
Total equity
10,522,866
11,001,922
Profit/(loss) for the year
(479,056)
(578,750)
Total comprehensive income/(loss) for the year
(479,056)
(578,750)
3.
PROFIT/(LOSS) FOR THE YEAR
The operating profit before income tax includes the following items of revenue and expense:
2022
2021
$
$
Revenue
Interest
3,007
1,779
Other income
8,162
10,000
Unrealised foreign exchange gain/(loss)
54,239
(82,519)
65,408
(70,740)
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.
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
57
4.
INCOME TAX EXPENSE
2022
2021
$
$
The major components of tax expense and the reconciliation of the expected tax
expense based on the domestic effective tax rate of 2022 at 25% (2021: 26%) 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
(1,596,068)
(1,670,471)
Income tax expense to accounting profit:
Tax at the Australian tax rate of 25% (2021: 26%)
(399,017)
(434,322)
Assessable amounts
103,274
80,336
Non-deductable expenses
88,403
-
Deferred tax asset losses not brought to account
-
177,571
Non-assessable income – other
-
(2,600)
Non-deductible items
-
193,760
Utilisation of unused tax losses previously unrecognised
109,026
(90,311)
Deferred tax assets recognised/ (not recognised)
(12,098)
14,230
Tax rate difference
110,412
61,336
Income tax expenses (benefit)
-
-
(c) Recognised Deferred Tax Balances
Deferred tax asset
7,738
19,850
Deferred tax asset (losses)
87,374
78,959
Set-off deferred tax liabilities
(95,112)
(98,809)
-
-
(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
1,292,096
1,411,926
Unrecognised deferred tax asset losses (capital)
409,991
426,391
Unrecognised deferred tax asset Oman losses
203,627
202,979
1,905,714
2,041,296
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;
(ii)
The Consolidated Entity continues to comply with the conditions for deductibility imposed by tax legislation in Australia; and
(iii)
There are no changes in tax law which will adversely affect the Consolidated Entity in realising the benefit of them.
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
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
58
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:
2022
2021
$
$
Rothsay Audit & Assurance Pty Ltd (2021: Rothsay Auditing) – Auditors of the
Consolidated Entity
(Audit and review of financial reports)
27,500
27,500
RSM Chartered Accountants – Auditors of Oman-controlled entities
(Audit and review of financial reports)
8,889
7,652
36,389
35,152
[The remainder of this page is intentionally blank]
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
59
6.
EARNINGS/(LOSS) PER SHARE
2022
2021
$
$
Basic earnings/(loss) per share cents
(0.19)
(0.24)
Diluted earnings/(loss) per share cents
(0.19)
(0.24)
Profit/(loss) used to calculate earnings/(loss) per share
(1,316,222)
(1,622,329)
Weighted average number of ordinary shares during the period used in calculation of
basic earnings/(loss) per share
705,429,239
667,645,289
Weighted average number of ordinary shares during the period used in calculation of
diluted earnings/(loss) per share
705,938,403
667,645,289
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
2022
2020
$
$
Cash in hand
972
542
Cash at bank
2,344,130
4,136,880
Term deposits
104,689
104,393
2,449,791
4,241,815
The effective interest rate on short-term bank deposits was 0.70% (2021: 0.25%) with an average maturity of 90 days.
(a) Risk exposure
The Consolidated Entity’s exposure to interest rate and foreign exchange risk is discussed in Note 23. 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
2022
2021
From Operations
$
$
Profit/(loss) after income tax
(1,596,068)
(1,670,471)
Gain/(loss) on foreign exchange (unrealised)
-
-
Profit on sale of asset
-
-
Gain/(loss) on disposal of subsidiary
-
-
Share of profits/(losses) of associates and joint ventures
40,430
53,477
Foreign exchange movement
(319,935)
21,738
Depreciation
21,876
12,099
(Increase)/decrease in assets:
Trade and other receivables
(45,978)
(7,933)
Other current assets
(43,450)
13,074
Increase/(decrease) in liabilities:
Insurance premium funding (other payables)
6,329
11,026
Trade and other payables
65,203
(159,942)
Provisions
60,423
72,083
Net cashflows from/(used in) operating activities
(1,811,168)
(1,654,849)
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
60
8.
TRADE AND OTHER RECEIVABLES
Current
2022
2021
$
$
Amounts receivable from:
Sundry debtors
84,279
17,419
Goods and services tax recoverable
8,194
6,244
VAT receivable
474,777
14,026
Advance to subcontractors
9,145,263
-
Cash advances
-
877
9,712,513
38,566
(a) Risk exposure
Information about the Consolidated Entity's exposure to credit risk, foreign exchange risk and interest rate risk is in Note 23.
(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
2022
2021
$
$
Prepayments
193,518
23,374
Accrued interest
933
495
194,451
23,869
10.
FINANCIAL ASSETS
2022
2021
$
$
Current
Bank deposits
1,036,625
1,030,168
Non-Current
Interest free loan to Alara Resources LLC
496,376
444,427
Bank deposits (more than one year)
10,519
9,661
1,543,520
1,484,256
11.
INVESTMENT IN ASSOCIATES
The movement for the year in the Consolidated Entity’s investments accounted for using the equity method is as follows:
2022
2021
$
$
Opening balance
139,350
192,827
Investment in Alara Resources LLC
-
-
Profit/(loss) from equity accounted investments
(40,430)
(53,477)
Subtotal
98,920
139,350
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 Consolidated Entity’s share
of losses of an associate exceeds the Consolidated Entity’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.
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
61
12.
BORROWING COST
2022
2021
$
$
Borrowing cost
834
766
Less: amortisation for the period
(203)
(33)
631
733
13.
PROPERTY, PLANT AND EQUIPMENT
Motor
Vehicles
Office
Equipment
Plant and
Equipment
Temporary
Structure
Mine
Properties &
Development
assets
Total
$
$
$
$
$
$
Year ended 30 June
2021
Carrying
amount
at
beginning
14,768
24,230
812
-
9,926,151
9,965,961
Additions
66,595
6,581
-
-
3,251,950
3,325,126
Disposal
-
-
-
-
-
-
Write-offs
-
-
-
-
Depreciation expense
(4,227)
(7,623)
(249)
-
-
(12,099)
Exchange difference
(1,201)
(972)
(66)
-
(795,068)
(797,307)
Closing
amount
at
reporting date
75,935
22,216
497
-
12,383,033
12,481,681
Year ended 30 June
2021
Cost or fair value
94,199
183,862
21,582
-
12,383,033
12,682,676
Accumulated
depreciation
(18,264)
(161,646)
(21,085)
-
-
(200,995)
Net carrying amount
75,935
22,216
497
-
12,383,033
12,481,681
Year ended 30 June
2022
Carrying
amount
at
beginning
75,935
22,216
497
-
12,383,033
12,481,681
Additions
-
22,461
-
32,402
11,680,023
11,734,886
Disposal
-
-
-
-
-
-
Write-offs
-
-
-
-
Depreciation expense
(11,784)
(9,222)
(171)
(699)
-
(21,876)
Exchange difference
6,121
646
36
(37)
1,150,268
1,157,034
Closing
amount
at
reporting date
70,272
36,101
362
31,666
25,213,324
25,351,725
Year ended 30 June
2022
Cost or fair value
102,558
209,341
23,497
32,402
25,213,324
25,581,122
Accumulated
depreciation
(32,286)
(173,240)
(23,135)
(736)
-
(229,397)
Net carrying amount
70,272
36,101
362
31,666
25,213,324
25,351,725
ACCOUNTING POLICY NOTE
All plant and equipment values 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
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
62
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
Depreciation Rate
Office equipment
15 – 37.5%
Motor vehicles
33.3%
Plant and equipment
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.
14.
EXPLORATION AND EVALUATION
2022
2021
$
$
Opening balance
4,910,968
5,161,876
- Exploration and evaluation expenditure
162,649
309,492
- Exchange differences
562,033
(560,400)
Closing balance
5,635,650
4,910,968
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 AUD 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. 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 into a Heads of Agreement with Awtad Copper LLC, under which a 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 about future events and circumstances, in particular whether an economically viable
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
63
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.
15.
TRADE AND OTHER PAYABLES
2022
2021
$
$
Current
Trade payables
3,687,635
979,725
Other payables
107,550
8,680
3,795,185
988,405
Due to the short-term nature of the trade and other payables, their carrying value is assumed to approximate their fair value.
16.
UNEARNED INCOME
2022
2021
$
$
Current
Unearned income
-
8,079
-
8,079
(a) Risk exposure
Details of the Consolidated Entity’s exposure to risks arising from current payables are set out in Note 23.
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.
17.
PROVISIONS
2022
2021
$
$
Current
Employee benefits – annual leave
154,427
93,838
Non-Current
Employee benefits – long service leave
-
-
154,427
93,838
Amounts not expected to be settled within 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.
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
64
(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.
18.
FINANCIAL LIABILITIES
Financial liabilities
2022
2021
$
$
Non-Current
Loan – Sohar International Bank
Opening balance
-
-
Add: Addition during the year
17,050,752
-
Add: Interest
308,697
-
Closing balance
17,359,449
-
Loan with unrelated third party
Opening balance
651,442
684,411
Add: Addition during the year
-
6,575
Add: Interest
23,319
17,725
Add/less: Foreign exchange differences
57,807
(57,269)
Closing balance
732,568
651,442
Vehicle Loan
Opening balance
50,277
-
Add: Addition during the year
-
60,180
Less: Unexpired interest on vehicle loan
(6,121)
(9,903)
Add/less: Foreign exchange differences
(1,842)
-
Closing balance
42,314
50,277
Total Financial Liabilities – Non-Current
18,134,331
701,669
Current
Vehicle Loan
Opening balance
10,384
-
Add: Addition during the year
7,253
15,693
Less: Unexpired Interest on vehicle loan
(4,660)
(5,309)
Add/less: Foreign exchange differences
(552)
-
Closing balance
12,425
10,384
Insurance Premium Funding
Opening balance
11,025
-
Add: Addition during the year
56,271
11,025
Less: Payment during the year
(62,503)
-
Closing balance
4,793
11,025
Total Financial Liabilities – Current
17,218
21,409
(i)
On 16 April 2017, Al Hadeetha Resources LLC (AHRL) (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 2,901,600; OMR 772,379) to assist with working capital for the Project (AHI to AHRL Loan). The AHI to
AHRL Loan bears interest at LIBOR plus two (2) percent per annum. The AHI to AHRL Loan will be in effect for the duration of the Project
joint venture agreement, at which time AHRL must repay any outstanding balance. AHRL must make interim repayments equal to its available
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
65
net cash profit (if any) at the end of each financial year. During the year AHRL 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 (after offsetting corresponding debit balance
of OMR 18,095; AUD 67,976) OMR 195,003 (USD 504,940; AUD 732,568). 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 AHI to AHR Loan amount is drawn down.
The remaining, un-drawn balance of the AHI to AHR Loan is OMR 559,282 (USD 1,448,205; AUD 2,101,056) (This is the undrawn balance
based on the gross drawdown amount of loan without offsetting the corresponding debit balance of OMR 18,095; AUD 67,976).
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 AUD 19.5 million and are subject to the same loan terms as the AHI to AHRL Loan.
The Consolidated Entity AHR Loans are repayable on the same basis as the AHI to AHRL Loan. Therefore, if AHRL makes a loan repayment
to AHI, AHRL will also be required to make a loan repayment to its lenders within the Alara Consolidated Group on a pro-rata basis.
(ii)
The Company’s 51% owned joint-venture vehicle Al Hadeetha Resource LLC (AHRL) has a finance facility of OMR 19 million (AUD 67.76
million) (Facility) from Sohar International (Sohar) for construction of mining and processing infrastructure at AHRL’s Wash-hi – Majaza
copper-gold project. The Facility is secured over AHRL’s mining property and mine development assets and by corporate guarantees by
stakeholders of AHRL, including an Alara wholly owned subsidiary. The interest rate for the Facility is 6.5% per annum for amounts drawn in
OMR and 5.15% per annum for amounts drawn in USD, reviewable annually.
The Facility has a term of 9 years and 9 months, including a moratorium period of 2 years and 9 months in which only interest is payable.
After the moratorium, the principal of the Facility is repayable in 28 equal quarterly instalments. Interest is payable monthly throughout the
term. There have been no breaches of the covenants or other provisions of the Facility in the reporting period or subsequently to the date of
this report. Sohar is a well-known and respected Bank in Oman. The Group’s due diligence in connection with entering the Facility involved
reviewing publicly available information regarding Sohar and making enquiries of other AHRL shareholders, which are large Omani
conglomerates each with extensive knowledge of the Omani banking industry.
19.
ISSUED CAPITAL
2022
2021
2022
2021
№
№
$
$
Fully paid, ordinary shares
705,429,239
705,429,239
68,233,860
68,233,860
2021
№
$
Balance as at 1 July 2020
634,886,315
66,340,323
- Share movement during the 2021 financial year
70,542,924
1,904,629
- Share issue costs during the 2021 financial year
-
(11,092)
Balance as at 30 June 2021
705,429,239
68,233,860
2022
№
$
Balance as at 1 July 2021
705,429,239
68,233,860
- Share movement during the 2022 financial year
-
-
- Share issue costs during the 2022 financial year
-
-
Balance as at 30 June 2022
705,429,239
68,233,860
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’s borrowings as at 30 June 2022 are disclosed in Note 18. 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.
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
66
20.
RESERVES
2022
2021
$
$
Foreign currency translation reserve
3,876,076
901,756
Transactions with minority interests
8,593,853
8,593,853
12,469,929
9,495,609
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:
Number of
options
2022
2021
Grant date
$
$
Employees’ Options
Listed options exercisable at AUD 0.03; expiring 01 July 2022 – Mr Gethin
3 Dec 2020
4,000,000
-
-
Listed options exercisable at $0.03: expiring 31 July 2024 – Mr Sthapak
23 Dec 2021
3,333,000
-
-
Listed options exercisable at $0.03: expiring 30 June 2024 – Mr Sthapak
23 Dec 2021
2,500,000
-
-
Listed options exercisable at $0.03: expiring 30 April 2024 – Mr Sthapak
23 Dec 2021
1,666,000
-
-
11,499,000
-
-
21.
SHARE-BASED PAYMENTS
There were no shares issued as a result of the exercise of any options during the year (2021: Nil).
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.
22.
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.
Australia
Oman
Saudi Arabia
Total
2022
$
$
$
$
Total segment revenues
2,299
8,870
-
11,169
Total segment loss/(profit)before tax
(491,950)
(1,123,328)
19,210
(1,596,068)
Total segment assets
3,190,631
41,796,570
-
44,987,201
Total segment liabilities
(710,971)
(21,390,190)
-
(22,101,161)
2021
Total segment revenues
11,116
663
-
11,779
Total segment loss/(profit)before tax
(1,112,876)
(542,903)
(14,692)
(1,670,471)
Total segment assets
3,527,013
19,794,225
-
23,321,238
Total segment liabilities
(552,903)
(1,260,547)
-
(1,813,450)
(a) Reconciliation of segment information
2022
2021
$
$
(i) Total Segment Assets
Total Assets as per Statement of Financial Position
44,987,201
23,321,238
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
67
P
39 f 0
(ii) Total Segment Revenues
Total Revenue as per Statement of Profit or Loss
and Other Comprehensive Income
11,169
11,779
(iii) Total Segment profit/(loss) before tax
Total Consolidated Entity profit/(loss) before tax
(1,576,068)
(1,670,471)
ACCOUNTING POLICY NOTE
Operating segments
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 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.
23.
FINANCIAL RISK MANAGEMENT
The Consolidated Entity's financial instruments mainly consist of deposits with banks, accounts receivable and payable, and investments. 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.
The Consolidated Entity holds the following financial instruments:
2022
2021
$
$
Financial assets
Cash and cash equivalents
2,449,791
4,241,815
Financial instruments (term deposits)
1,047,144
1,039,829
Trade and other receivables
9,712,513
38,566
Financial asset
496,376
444,427
13,705,824
5,764,637
Financial liabilities at amortised cost
Trade and other payables
(3,795,185)
(988,405)
Financial liabilities
(18,151,549)
(723,128)
(21,946,734)
(1,711,533)
Net Financial Assets
(8,240,910)
4,053,104
(a) Market Risk
(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 0.70 % (2021: 0.25%).
2022
2021
$
$
Cash at bank
2,344,130
4,136,880
Term deposits
104,689
104,393
Term deposits more than 90 days
1,047,144
1,039,829
Loan with unrelated third parties
-
(723,128)
Current financial liabilities
(17,218)
-
Non-current financial liabilities
(18,134,331)
-
(14,655,586)
4,557,974
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
68
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:
2022
2021
Financial Liability
$
$
Change in profit
Increase by 1%
(181,515)
(7,231)
Decrease by 1%
181,515
7,231
Change in equity
Increase by 1%
(181,515)
(7,231)
Decrease by 1%
181,515
7,231
2022
2021
Revenue
$
$
Change in profit
Increase by 3%
73,494
127,254
Decrease by 3%
(73,494)
(127,254)
Change in equity
Increase by 3%
73,494
127,254
Decrease by 3%
(73,494)
(127,254)
(iii) Foreign exchange risk
The Consolidated Entity is exposed to foreign currency risk in cash held in Omani Rials (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 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:
2022
2021
OMR
OMR
Cash and cash equivalents
293,850
817,141
Trade and other receivables
2,738,853
124,385
Trade and other payables
(922,501)
(245,804)
Non-current financial liabilities
(4,829,634)
(206,376)
(2,719,432)
489,346
2022
2021
US $
US $
Cash and cash equivalents
188,745
71
188,745
71
The Consolidated Entity’s exposure to foreign exchange risk is mitigated by having comparable asset and liability balances in OMR and 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.
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
69
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) 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:
2022
2021
$
$
Cash and cash equivalents
BB-
2,448,819
4,241,273
No external credit rating available
972
542
2,449,791
4,241,815
Trade and other receivables (due within 30 days)
No external credit rating available
9,712,513
38,566
9,712,513
38,566
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.
(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:
Less than
6 months
6-12
months
1-5
years
Total
2022
$
$
$
$
Financial assets
Cash and cash equivalents
2,449,791
-
-
2,449,791
Financial instruments (term deposits)
1,002,439
34,186
10,519
1,047,144
Interest-free loan to Alara Resources LLC
-
-
496,376
496,376
Trade and other receivables
9,712,513
-
-
9,712,513
13,164,743
34,186
506,895
13,705,824
Financial liabilities
Trade and other payables
(3,795,185)
-
-
(3,795,185)
Other financial liabilities
(10,852)
(6,365)
(18,134,332)
(18,151,549)
(3,806,037)
(6,365)
(18,134,332)
(21,946,734)
Net inflow/(outflow)
9,358,706
27,821
(17,627,437)
(8,240,910)
2021
Less than
6 months
6-12
months
1-5
years
Total
Financial assets
$
$
$
$
Cash and cash equivalents
4,241,815
-
-
4,241,815
Financial instruments (term deposits)
-
1,030,168
9,661
1,039,829
Interest-free loan to Alara Resources LLC
-
-
444,427
444,427
Trade and other receivables
38,566
-
-
38,566
4,280,381
1,030,168
454,088
5,764,637
Financial liabilities
Trade and other payables
(988,405)
-
-
(988,405)
Other financial liabilities
(16,087)
(5,322)
(701,719)
(723,128)
(1,004,492)
(5,322)
(701,719)
(1,711,533)
Net inflow/(outflow)
3,275,889
1,024,846
(247,631)
4,053,104
(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 Notes 15 and 18.
(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.
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
70
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 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.
24.
COMMITMENTS
2022
2021
$
$
(a) Lease Commitments
Non-cancellable operating lease commitments:
Within 1 year
17,403
14,045
1-5 years
-
-
After 5 years
-
-
Total
17,403
14,045
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. During the year the Group has signed a sub-lease for the office space
hence mitigating the outstanding lease commitments remaining on the lease.
(b) Capital Commitments
Under procurement contracts which AHRL entered during the reporting period it became committed to total capital expenditure of USD 54.55m
(AUD 79.14m).
25.
CONTROLLED ENTITIES
Investment in Controlled Entities
Controlled
entity
Principal Activity
Country of
Incorporation
Date of
Incorporation
Jun-22
Jun-21
Alara Resources Limited (AUQ)
Parent
Exploration
Australia
6-Dec-06
100%
100%
Alara Peru Operations Pty Ltd (APO)
AUQ
Inactive
Australia
9-Mar-07
100%
100%
Alara Saudi Operations Pty Ltd (ASO)
AUQ
Management
Australia
4-Aug-10
100%
100%
Saudi Investments Pty Limited (SIV)
AUQ
Development
Australia
14-Feb-11
100%
100%
Alara Oman Operations Pty Limited (AOO)
AUQ
Management
Australia
28-Jun-10
100%
100%
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
71
26.
JOINTLY CONTROLLED ENTITIES & INVESTMENTS IN ASSOCIATES
Investment in Jointly Controlled Entities
Controlled
entity
Principal Activity
Country of
Incorporation
Date of
Incorporation
Jun-22
Jun-21
Daris Resources LLC
AOO
Exploration
Oman
1-Dec-10
50%
50%
Alara Resources LLC
AOO
Mining Services
Oman
2-Oct-10
35%
35%
27.
RELATED-PARTY TRANSACTIONS
Controlled and Jointly Controlled Entities
Details of the interest in controlled entities and jointly controlled entities are set out in Notes 25 and 26.
Transactions with other related parties
The following transactions occurred with related parties during the year ending 30 June 2022:
Director loan agreement
There was no outstanding Director’s loan during the year.
Transactions with Key Management Personnel
Key Management of the Consolidated Entity are each Director and 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. Details of Key Management
Personnel’s individual remuneration are disclosed in the Remuneration Report section of the Directors’ Report. Key Management Personnel
remuneration includes the following expenses:
2022
$
2021
$
Short-term employee benefits:
Remuneration including bonuses and allowances
594,968
1,108,572
Total short term employee benefits
594,968
1,108,572
Long-term benefits
23,204
-
Total other long-term benefits
23,204
-
Post-employment benefits:
Defined benefit pension plans
-
-
Defined contribution pension plans
2,170
2,314
Total post-employment benefits
2,170
2,314
Termination benefits
-
-
Share-based payments
-
-
Total remuneration
620,342
1,110,886
28.
CONTINGENT ASSETS AND LIABILITIES
Contingent assets and liabilities exist in relation to certain exploration and evaluation assets of the Consolidated Entity, subject to the continued
development and advancement of the same, as described below.
(a)
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.
Investment in Controlled Entities
Controlled
entity
Principal Activity
Country of
Incorporation
Date of
Incorporation
Jun-22
Jun-21
Alara Kingdom Operations Pty Limited (AKO)
AUQ
Management
Australia
5-Sep-11
100%
100%
Alara Saudi Holdings Pty Limited (ASH)
AUQ
Inactive
Australia
5-Jun-13
100%
100%
Al Hadeetha Resources LLC
AOO
Exploration /
Development
Oman
6-Feb-07
51%
51%
Alara Resource Ghana Limited
AUQ
Inactive
Ghana
8-Dec-09
100%
100%
Alara Peru S.A.C
APO
Inactive
Peru
1-Mar-07
100%
100%
Alara Operations LLC
AOO
Administration
Oman
01-Feb-20
100%
100%
Sita Mining Company LLC
ASO
Inactive
Saudi Arabia
Khnaiguiyah Mining Company LLC
AKO
Inactive
Saudi Arabia
Alara Saudi Ventures Pty Ltd
AUQ
Administration
Australia
1 March 2022
100%
100%
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
72
Notes to the Consolidated Financial Statement
for the year ended 30 June 2022
(b)
Loan to unrelated party (AHI) (Oman) – On 26 October 2017 Al Hadeetha Investments LLC (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 AHRL in connection with the Al
Wash-hi – Majaza 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 AHRL. This amount will be returned to the Consolidated Entity in the event that
AHRL performs its environmental obligations in relation to that mining licence.
(c)
Guarantee of AHRL Loan – Alara Oman Operations Pty Limited, a wholly owned subsidiary of Alara Resources Ltd has provided a
guarantee to Sohar International SAOG (Sohar) for the full liability of Al Hadeetha Resources LLC (AHRL – Alara, 51%) under a loan of
OMR 19 million (AUD 71,377,414) from Sohar to AHRL (Sohar Loan), the proceeds of which AHRL is using to finance construction of the
Wash-hi – Majaza copper-gold project in Oman.
(d)
Cross indemnity in relation to AHRL Loan Guarantee – Principals (Guarantors) of shareholders in AHRL which hold 30% and 19% of
the shares in AHRL respectively have provided personal guarantees to Sohar in respect of the Sohar Loan (Guarantees) which correspond
to the guarantee referred to in note 28(c). Alara Resources Limited has provided an indemnity to the Guarantors in respect of their liability
under the Guarantee, limited to 49% of any amount paid by the Guarantors to Sohar under the Guarantees.
29.
SUBSEQUENT EVENTS
Events occurring after the balance date are set out below:
4,000,000 options granted to Chairman Stephen Gethin on 3 December 2020 at the exercise price of $0.03 per share were exercised on 1 July
2022.
Al Wash-hi Majaza Project (“Project”) development
The Company continued to develop the Project after the end of the reporting period, as detailed in the section of this report titled “Review of
Operations”.
[The remainder of this page is intentionally blank]
Notes to the Consolidated Financial Statements
for the year ended 30 June 2022
Alara Resources Annual Report 2022
73
Directors’ Declaration
for the year ended 30 June 2022
The Directors of the Company declare that:
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)
Comply with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations
Regulations 2001; and
(b)
Give a true and fair view of the Consolidated Entity’s financial position as at 30 June 2022 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 15 to 20 (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.
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 2022.
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
30 September 2022
Alara Resources Annual Report 2022
74
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 2022, 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 2022 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
auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
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.
Independent Auditor’s Report
Alara Resources Annual Report 2022
75
Independent Auditor’s Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
ALARA RESOURCES LIMITED (continued)
Key Audit Matter – Financial Liabilities
How our Audit Addressed the Key Audit Matter
The Group has significant financial liabilities as
disclosed in Note 18 to the financial report.
This was considered to be a key audit matter due
to its importance in financing future activities of
the Group and complexities in determining
whether financial covenants have been complied
with, ensuring that the classification between
current and non-current is accurate and in
valuing the financial liabilities denominated in
foreign currencies.
Our procedures over the Group’s financial liabilities
included but were not limited to:
•
Reviewing financing agreements;
•
Agreeing significant financial liabilities to
independent third-party confirmations or other
supporting documentation; and
•
Reviewing managements assessment of
compliance with financial covenants related to
the financial liabilities.
We have also assessed the appropriateness of the
disclosures included in the financial report.
Key Audit Matter – Exploration and Evaluation
Expenditure and Mine Properties and
Development Assets
How our Audit Addressed the Key Audit Matter
The Group incurred significant expenditure on
exploration and evaluation and mine properties
and development assets during the year.
We do not consider exploration and evaluation
and mine properties and development assets 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.
Our procedures in assessing exploration and
evaluation and mine properties and development
assets 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 considered whether there were any
indicators of impairment;
•
We tested a sample of expenditure to
supporting documentation to ensure they were
bona fide payments; and
•
We documented and assessed the processes
and controls in place to record expenditure.
We have also assessed the appropriateness of the
disclosures included in the financial report.
Independent Auditor’s Report
Alara Resources Annual Report 2022
76
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 2022, 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.
Independent Auditor’s Report
Alara Resources Annual Report 2022
77
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 2022.
In our opinion the remuneration report of Alara Resources Limited for the year ended 30 June 2022 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 Audit & Assurance Pty Ltd
Daniel Dalla
Director
Dated 30 September 2022
Independent Auditor’s Report
Alara Resources Annual Report 2022
78
Independent Auditor’s Report
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 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.
[The remainder of this page is intentionally blank]
Forward Looking Statements
Alara Resources Annual Report 2022
79
Director and employee unlisted options
See the Company’s Notice of Meeting for its 2021 Annual General Meeting, released on ASX on
22 November 2021, for the terms of the options issued to the Managing Director referred to
above. Other than those options, there are no other Directors’ or employee options in the
Company.
Distribution of fully paid, ordinary shares
Spread of
Holdings
No. of Holders
Number of Units
% of Issued Capital
1 – 1000
851
277,339
0.039%
1,001 – 5,000
248
581,226
0.081%
5,001 – 10,000
157
1,304,617
0.182%
10,001 – 100,000
449
17,608,073
2.452%
100,001 +
268
698,316,266
97.247%
TOTAL
1,973
718,087,541
100%
Top 20 Ordinary Fully Paid Shareholders
Rank
Shareholder
Shares Held
% Issued
Capital
1.
Al Tasnim Infrastructure LLC
99,650,067
13.87%
2.
Mr Vikas Malu
57,142,050
7.96%
3.
Ms Meng Meng
41,844,441
5.83%
4.
Citicorp Nominees Pty Ltd
39,211,942
5.46%
5.
Mr Vikas Jain
37,745,930
5.26%
6.
Al Hadeetha Investment Services LLC
31,500,000
4.39%
7.
Metals Corners Holding Co
25,021,216
3.48%
8.
Mr Piyush Jain
24,199,437
3.37%
9.
Whitechurch Developments Pty Ltd
19,996,404
3.24%
10.
BNP Paribas Nominees Pty Ltd
17,824,388
2.48%
11.
Mr Tyrone James Giese
17,456,189
2.43%
12.
Mr Mohammed Saleh Alalshaikh
16,755,225
2.33%
13.
Inkese Pty Ltd and Mr and Jay and Mrs Linda Hughes
15,000,000
2.16%
14.
Progesys International FZC
14,527,028
2.02%
15.
Ferguson Superannuation
11,843,878
1.65%
16.
Mr Farrokh Masani
10,676,187
1.49%
17.
Mr Pradeep Kumar Goyal
10,609,742
1.48%
18.
Mr. Anthony and Mrs Sue Cullen
9,758,544
1.36%
19.
Mr Peter Kelvin Rodwell
9,422,858
1.31%
20.
Mr Warren and Mrs Marilyn Brown
8,664,286
1.20%
Total
445,503,700
72.77%
On-market buy back
There is no current on-market buy back.
Securities Information12
Issued Securities
Quoted on ASX
Unlisted
Total
Fully paid, ordinary shares
718,087,541
–
718,087,541
Options
-
5,000,000
5,000,000
Total
723,087,541
12. Current at 27 October 2022
Unmarketable parcels
Min parcel size
Holders
Units
Minimum $500.00 parcel at $0.013 per unit
29,411
1,399
4,454,513
Alara Resources Annual Report 2022
80
Compliance Information
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 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.
Alara Resources Annual Report 2022
81
Corporate Directory
Corporate Directory
Board of Directors
Stephen Gethin
Non-Executive
Chairman
Atmavireshwar Sthapak Managing Director
Vikas Jain
Non-Executive
Director and Chair of
Audit Committee
Sanjeev Kumar
Non-Executive
Director
Devaki Khimji
Non-Executive
Director
Farrokh Masani
(Alternate) Non
Executive Director
Dinesh Aggarwal
Company Secretary
Registered Office and Business Address
Suite 1.02,110 Erindale Road
Balcatta Western Australia 6021
PO Box 963
Balcatta, Western Australia 6914
Telephone: + 61 8 9240 4211
E-mail:
info@alararesources.com
Auditors
Rothsay Audit & Assurance Pty Ltd
Level 1, Lincoln House
4 Ventnor Avenue
West Pert WA 6005
Tel: +61 8 9486 7094
Share Registry
Advanced Share Registry Ltd
110 Stirling Highway
Nedlands, Western Australia 6009
Telephone: +61 8 9389 8033
Facsimile:
+61 8 9262 3723
Level 6, 225 Clarence Street
Sydney, New South Wales 2000
Telephone: +61 2 8096 3502
E-mail:
admin@advancedshare.com.au
Website:
www.advancedshare.com.au
Australian Securities Exchange
ASX Limited
Level 40, Central Park
152-158 St Georges Terrace
Perth, Western Australia 6000
ASX Code: AUQ
Corporate Governance Statement
The Company’s Corporate Governance Statement
is available on the Company’s Website:
www.alararesources.com
Website: www.alararesources.com
Alara Resources Annual Report 2022
82
Alara Resources Limited
Suite 1.02, 110 Erindale Road, Balcatta, Western Australia 6021
T +61 8 9240 4211 | E info@alararesources.com
www.alararesources.com