C U L L E N
R E S O U R C E S L I M I T E D
Registered and Principal Office
Unit 4
7 Hardy Street
South Perth WA 6151
Telephone (08) 9474 5511
Facsimile (08) 9474 5588
Website: www.cullenresources.com.au
Email: cullen@cullenresources.com.au
C U L L E N
R E S O U R C E S L I M I T E D
A N N U A L
R E P O R T 2 0 1 2
1
2
Cullen Resources Limited
Chairman’s Report
CORPORATE DIRECTORY
CONTENTS
Chairman's Report
Company Profile
Highlights
Exploration Review
Directors' Report
Corporate Governance Statement
Statement of Financial Position
Statement of Changes in Equity
Statement of Comprehensive Income
Statement of Cash Flows
Notes to the Financial Statements
Directors' Declaration
Independent Audit Report
Shareholder Information
2
3
4
5
23
32
35
36
37
38
39
67
68
70
ABN: 46 006 045 790
Directors
Denis Clarke (Non-executive Chairman)
Chris Ringrose (Managing Director)
John Horsburgh (Non-executive)
Grahame Hamilton (Non-executive)
Wayne Kernaghan (Non-executive)
Secretary
Wayne Kernaghan
Registered and Principal Office
Unit 4
7 Hardy Street
South Perth WA 6151
Telephone +61 (8) 9474 5511
Facsimile +61 (8) 9474 5588
Auditors
Ernst & Young
11 Mounts Bay Road
Perth WA 6000
Solicitors
Jackson McDonald
Level 25
140 St Georges Terrace
Perth WA 6000
Bankers
Westpac
Sydney NSW 2000
Securities Quoted
Australian Stock Exchange
Limited
Home Exchange - Sydney
ASX Code: CUL
Share Registry
Computershare Investor
Services
Level 3, 60 Carrington Street
Sydney NSW 2000
Telephone (02) 8234 5000
www.computershare.com
Email
cullen@cullenresources.com.au
Company Website
www.cullenresources.com.au
DEAR FELLOW SHAREHOLDER
Cullen is a discovery-driven exploration company that over many years has built a large portfolio of
projects in several very prospective geological terranes. Concurrently, in joint venture we are
participating in a planned, major iron ore development in the West Pilbara region of Western Australia.
Our company is well-positioned in regions where exploration activity is high, where new discoveries are
being made, and in commodities of interest to the market.
It is a deliberate strategy of ours to seek out multiple opportunities in several commodities in order to
fully exploit our in-house geological expertise and spread risk. We have adopted this strategy both here
in Australia, and in selected, stable, mining–friendly jurisdictions overseas. Countries with accessible
geological databases, high fundamental prospectivity and especially those with covered terranes
where limited previous exploration has been completed, offer the best opportunities for the
application of Cullen's innovative exploration methods and approach. This is Cullen's niche, and we
have been successful in developing an excellent portfolio of prospective projects for our own
exploration, or for attracting joint venture partners. Through the past year the Company has
progressed several of its projects to an exciting drill-testing stage. In particular, the North Tuckabianna
project near Cue in the Murchison Region of Western Australia, and the TL Property in British Columbia,
offer significant opportunities for discovery. These projects and their targets have been honed from
careful research, data compilation, field surveys, programme planning and application of experience
and geological knowledge.
Cullen is also continuing its innovative approaches in exploration, including utilizing regional
biogeochemical surveying in its search for gold in covered terrane in Finland. Also in Finland, the
Company has taken a number of ground positions over advanced graphite prospects where diamond
drilling has located wide intersections of good-grade graphite.
The Company through the Mt Stuart Iron Ore Joint Venture (MSIOJV) is participating in a valuable,
planned, new iron ore development project in the West Pilbara Region. Cullen has recently appointed
RFC Ambrian Limited as advisors to pursue various corporate options for maximising the value of our
iron ore interest.
In conclusion, I wish to sincerely thank all shareholders for their continued interest and support, and
our small but effective team of staff in Perth, my fellow directors, our consultants and contractors
for their contributions.
Dr. Denis Clarke, Chairman
1
2
Cullen Resources Limited
Chairman’s Report
CORPORATE DIRECTORY
CONTENTS
Chairman's Report
Company Profile
Highlights
Exploration Review
Directors' Report
Corporate Governance Statement
Statement of Financial Position
Statement of Changes in Equity
Statement of Comprehensive Income
Statement of Cash Flows
Notes to the Financial Statements
Directors' Declaration
Independent Audit Report
Shareholder Information
2
3
4
5
23
32
35
36
37
38
39
67
68
70
ABN: 46 006 045 790
Directors
Denis Clarke (Non-executive Chairman)
Chris Ringrose (Managing Director)
John Horsburgh (Non-executive)
Grahame Hamilton (Non-executive)
Wayne Kernaghan (Non-executive)
Secretary
Wayne Kernaghan
Registered and Principal Office
Unit 4
7 Hardy Street
South Perth WA 6151
Telephone +61 (8) 9474 5511
Facsimile +61 (8) 9474 5588
Auditors
Ernst & Young
11 Mounts Bay Road
Perth WA 6000
Solicitors
Jackson McDonald
Level 25
140 St Georges Terrace
Perth WA 6000
Bankers
Westpac
Sydney NSW 2000
Securities Quoted
Australian Stock Exchange
Limited
Home Exchange - Sydney
ASX Code: CUL
Share Registry
Computershare Investor
Services
Level 3, 60 Carrington Street
Sydney NSW 2000
Telephone (02) 8234 5000
www.computershare.com
Email
cullen@cullenresources.com.au
Company Website
www.cullenresources.com.au
DEAR FELLOW SHAREHOLDER
Cullen is a discovery-driven exploration company that over many years has built a large portfolio of
projects in several very prospective geological terranes. Concurrently, in joint venture we are
participating in a planned, major iron ore development in the West Pilbara region of Western Australia.
Our company is well-positioned in regions where exploration activity is high, where new discoveries are
being made, and in commodities of interest to the market.
It is a deliberate strategy of ours to seek out multiple opportunities in several commodities in order to
fully exploit our in-house geological expertise and spread risk. We have adopted this strategy both here
in Australia, and in selected, stable, mining–friendly jurisdictions overseas. Countries with accessible
geological databases, high fundamental prospectivity and especially those with covered terranes
where limited previous exploration has been completed, offer the best opportunities for the
application of Cullen's innovative exploration methods and approach. This is Cullen's niche, and we
have been successful in developing an excellent portfolio of prospective projects for our own
exploration, or for attracting joint venture partners. Through the past year the Company has
progressed several of its projects to an exciting drill-testing stage. In particular, the North Tuckabianna
project near Cue in the Murchison Region of Western Australia, and the TL Property in British Columbia,
offer significant opportunities for discovery. These projects and their targets have been honed from
careful research, data compilation, field surveys, programme planning and application of experience
and geological knowledge.
Cullen is also continuing its innovative approaches in exploration, including utilizing regional
biogeochemical surveying in its search for gold in covered terrane in Finland. Also in Finland, the
Company has taken a number of ground positions over advanced graphite prospects where diamond
drilling has located wide intersections of good-grade graphite.
The Company through the Mt Stuart Iron Ore Joint Venture (MSIOJV) is participating in a valuable,
planned, new iron ore development project in the West Pilbara Region. Cullen has recently appointed
RFC Ambrian Limited as advisors to pursue various corporate options for maximising the value of our
iron ore interest.
In conclusion, I wish to sincerely thank all shareholders for their continued interest and support, and
our small but effective team of staff in Perth, my fellow directors, our consultants and contractors
for their contributions.
Dr. Denis Clarke, Chairman
3
Company Profile
Company Profile
4
Perth-based minerals explorer with:
- iron ore Reserve
- geographically diverse interests
- multi-commodity portfolio
- multiple JV partnerships
- active programmes
- innovative approach
- motivated management
- experienced board
Australia, Namibia, Scandinavia, Canada
Kimberley
Craton
Advaita JV
Canning
Basin
Lake Mackay
Arunta
West Pilbara JV
Archean
Pilbara Craton
Wyloo JV
Hardey Junction JV
Paraburdoo JV
Kunderong JV
Galilee,Eromanga
Amadeus
Mt Isa
Craton
Hill Springs
Ashburton Basin
Gunbarrel
Cue
Archean
Yilgarn Craton
Killaloe JV
Perth
Forrestania JV
Gawler
Craton
Uranium
Gold
Coal
Tungsten
Nickel
Iron
Copper, gold
Phosphate
Minter
Lachlan
Fold Belt
SCANDINAVIA:
Iron Ore, IOCG,
Gold, Graphite
BC, CANADA:
Base Metals,
Coal, Graphite
NAMIBIA:
Copper, REE,
Coal
AUSTRALIA
Highlights
Highlights
2011/2012
2011/2012
MURCHISON, WA
GOLD & BASE METALS
Project area approximately 30km east of Cue, covering the northern part
of the Tuckabianna – Webbs Patch greenstone sequence. Exploration
targets for gold and VMS-style base metal mineralisation in this
underexplored area. EM anomalies ready to drill.
BRITISH COLUMBIA
ZINC
HeliTEM survey flown centred on high-grade, greenfields zinc
mineralisation at the “TL Property” where trenching exposed +10m wide
sulphide mineralization with best channel sample of 3m @ 8.98% Zn.
Numerous EM anomalies defined for follow-up.
LACHLAN , NSW
TUNGSTEN
Diamond drilling completed at Minter testing for cupola-related, tungsten-
bearing vein system. Best assay of 1.4m @ 1.36% WO from 232.7m.
3
CATHO WELL, WA
IRON
Mineral Resource Estimate for the Catho Well Channel Iron Deposit of
98Mt @ 55.0 % Fe and a Maiden JORC Reserve Estimate of 70Mt @
54.8% Fe (Cullen 30%).
WYLOO, WA
IRON
Maiden Inferred Resource of Bedded Iron of 16.9Mt @ 57.11% Fe
(Cullen 20%).
SCANDINAVIA
IRON, GOLD & COPPER
GRAPHITE
Tenure in Sweden near Kiruna (iron and copper) and in Finland near
Kuusamo (gold). Large portfolio for graphite in Finland.
NAMIBIA
COPPER
Five Exclusive Prospecting Licences in Namibia for copper and base
metals are granted with other applications for copper and coal pending.
CANNING BASIN, WA
COAL
RC drilling campaign completed by JV Manager, Advaita Canning
Resources Pty Ltd, with coal intersections in four holes.
NW QUEENSLAND
COAL
Two tenements granted near Hughenden with several others in Galilee
and Eromanga Basins pending.
3
Company Profile
Company Profile
4
Perth-based minerals explorer with:
- iron ore Reserve
- geographically diverse interests
- multi-commodity portfolio
- multiple JV partnerships
- active programmes
- innovative approach
- motivated management
- experienced board
Australia, Namibia, Scandinavia, Canada
Kimberley
Craton
Advaita JV
Canning
Basin
Lake Mackay
Arunta
West Pilbara JV
Archean
Pilbara Craton
Wyloo JV
Hardey Junction JV
Paraburdoo JV
Kunderong JV
Galilee,Eromanga
Amadeus
Mt Isa
Craton
Hill Springs
Ashburton Basin
Gunbarrel
Cue
Archean
Yilgarn Craton
Killaloe JV
Perth
Forrestania JV
Gawler
Craton
Uranium
Gold
Coal
Tungsten
Nickel
Iron
Copper, gold
Phosphate
Minter
Lachlan
Fold Belt
SCANDINAVIA:
Iron Ore, IOCG,
Gold, Graphite
BC, CANADA:
Base Metals,
Coal, Graphite
NAMIBIA:
Copper, REE,
Coal
AUSTRALIA
Highlights
Highlights
2011/2012
2011/2012
MURCHISON, WA
GOLD & BASE METALS
Project area approximately 30km east of Cue, covering the northern part
of the Tuckabianna – Webbs Patch greenstone sequence. Exploration
targets for gold and VMS-style base metal mineralisation in this
underexplored area. EM anomalies ready to drill.
BRITISH COLUMBIA
ZINC
HeliTEM survey flown centred on high-grade, greenfields zinc
mineralisation at the “TL Property” where trenching exposed +10m wide
sulphide mineralization with best channel sample of 3m @ 8.98% Zn.
Numerous EM anomalies defined for follow-up.
LACHLAN , NSW
TUNGSTEN
Diamond drilling completed at Minter testing for cupola-related, tungsten-
bearing vein system. Best assay of 1.4m @ 1.36% WO from 232.7m.
3
CATHO WELL, WA
IRON
Mineral Resource Estimate for the Catho Well Channel Iron Deposit of
98Mt @ 55.0 % Fe and a Maiden JORC Reserve Estimate of 70Mt @
54.8% Fe (Cullen 30%).
WYLOO, WA
IRON
Maiden Inferred Resource of Bedded Iron of 16.9Mt @ 57.11% Fe
(Cullen 20%).
SCANDINAVIA
IRON, GOLD & COPPER
GRAPHITE
Tenure in Sweden near Kiruna (iron and copper) and in Finland near
Kuusamo (gold). Large portfolio for graphite in Finland.
NAMIBIA
COPPER
Five Exclusive Prospecting Licences in Namibia for copper and base
metals are granted with other applications for copper and coal pending.
CANNING BASIN, WA
COAL
RC drilling campaign completed by JV Manager, Advaita Canning
Resources Pty Ltd, with coal intersections in four holes.
NW QUEENSLAND
COAL
Two tenements granted near Hughenden with several others in Galilee
and Eromanga Basins pending.
5
6
Exploration Review
Exploration Review
Australia
Australia
ASHBURTON/PILBARA, WA
Cullen holds a number of tenements in the Ashburton/West Pilbara Region, in
several joint ventures, in the search for iron, gold, and uranium. These joint
ventures provide the Company with exposure to a number of exploration plays in
an environment where local concentration of exploration effort, by well-positioned
players represents the most cost effective route to a discovery.
WEST PILBARA MT STUART JV –
IRON
MINERAL RESOURCE ESTIMATE FOR THE CATHO WELL CHANNEL IRON DEPOSIT:
(CULLEN 30%)
Joint
Venture
Mt Stuart
JV
JORC
Classification
Measured
Indicated
Inferred
TOTAL
Mt
2
73
23
98
Fe
%
P
%
SiO2
%
AI O2 3
%
S
%
Mn
%
MgO
%
LOI
%
55.1
0.041
6.61
3.64
0.020
0.058
0.208
9.99
55.1
0.037
6.91
3.16
0.016
54.6
0.037
7.53
3.10
0.015
0.079
0.102
0.178
0.209
10.26
10.40
55.0
0.037
7.05
3.15
0.016
0.084
0.186
10.29
The Catho Well Mineral Resource estimate is reported at a 53% Fe cut-off. The resource estimate has been compiled in accordance with the
guidelines defined in the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (The JORC Code, 2004
Edition).
The Mt Stuart Iron Ore Joint Venture (MSIOJV) is between Cullen - 30%, and the
In December 2010, Cullen reported the maiden JORC Ore Reserve Estimate for the Catho Well Channel Iron
unincorporated joint venture known as the Australian Premium Iron Joint Venture (APIJV)
Deposit based on the Resource Estimate .
- 70%. The APIJV comprises Aquila Steel Pty Ltd (a subsidiary of Aquila Resources
Limited (Aquila, ASX: AQA)) 50%, and AMCI (IO) Pty Ltd 50%. In July 2010, Aquila
MT STUART JOINT VENTURE (MSIOJV) ORE RESERVE ESTIMATE (CULLEN 30%)
reported the results of a Feasibility Study (FS) for the 30Mtpa West Pilbara Iron Ore
Project - Stage 1 indicating technical viability.
The Catho Well deposit is a potential component of the broader West Pilbara Iron Ore
Project (WPIOP). Ore derived from the Catho Well Deposit (MSIOJV) contributes to the
main, blended product stream maintaining an average 57.2% Fe throughout the
proposed 15 year mine life of the WPIOP - Stage 1 mining operations. The Mining
Feasibility Study (MFS) for Catho Well will include a scenario which assumes the
ownership of Cullen's run of mine ore will be transferred, after loading to trains, at the
“mine gate”. It is anticipated that, based on the MFS, the MSIOJV Participants will require
the JV Manager to submit a Development Proposal to the MSIOJV Participants and that
this, in turn, will lead to consideration of a Decision to Mine by the MSIOJV Participants.
A feasibility study for the mining of the Catho Well deposit was issued by the Manager in
May, 2012. As indicated to the ASX on the 7 June, 2012, Cullen does not accept that the
study is a feasability study under the definition in the MSIOJV agreement, mainly because
the development requires an infrastructure rail and port solution which has not yet been
Product
Category
Tonnes
Mt
Product 1
TOTAL
Proved
Probable
Total
Proved
Probable
Total
1
69
70
1
69
70
Fe
%
55.28
54.80
54.81
55.28
54.80
54.81
AI O2 3
%
3.33
3.23
3.23
3.33
3.23
3.23
SiO2
%
6.57
7.23
7.22
6.57
7.23
7.22
P
%
0.043
0.037
0.037
0.043
0.037
0.037
LOI
%
10.03
10.31
10.30
10.03
10.31
10.30
Competent Person Statement Resource
The information in this announcement that relates to Mineral Resources has been supervised by Mr Stuart Tuckey and Mr Richard Gaze who are
members of the Australasian Institute of Mining and Metallurgy. Mr Tuckey is a full-time employee of Australian Premium Iron. Mr Gaze is a full time
employee of Golder Associates Pty Ltd. Messrs Tuckey and Gaze have sufficient experience which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the 2004 Edition of the
'Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Tuckey and Mr Gaze consent to the inclusion in
the report of the matters based on their information in the form and context in which it appears.
approved.
Competent Person Statement Reserve
The information in this release that relates to Ore Reserves is based on information compiled by Mr Steve Craig, Managing Director of ORElogy
(Mining Consultants). Mr Craig is a Member of the Australasian Institute of Mining and Metallurgy 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 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Craig consents to the
inclusion of the matters based on his information in the form and context in which it appears in this release.
5
6
Exploration Review
Exploration Review
Australia
Australia
ASHBURTON/PILBARA, WA
Cullen holds a number of tenements in the Ashburton/West Pilbara Region, in
several joint ventures, in the search for iron, gold, and uranium. These joint
ventures provide the Company with exposure to a number of exploration plays in
an environment where local concentration of exploration effort, by well-positioned
players represents the most cost effective route to a discovery.
WEST PILBARA MT STUART JV –
IRON
MINERAL RESOURCE ESTIMATE FOR THE CATHO WELL CHANNEL IRON DEPOSIT:
(CULLEN 30%)
Joint
Venture
Mt Stuart
JV
JORC
Classification
Measured
Indicated
Inferred
TOTAL
Mt
2
73
23
98
Fe
%
P
%
SiO2
%
AI O2 3
%
S
%
Mn
%
MgO
%
LOI
%
55.1
0.041
6.61
3.64
0.020
0.058
0.208
9.99
55.1
0.037
6.91
3.16
0.016
54.6
0.037
7.53
3.10
0.015
0.079
0.102
0.178
0.209
10.26
10.40
55.0
0.037
7.05
3.15
0.016
0.084
0.186
10.29
The Catho Well Mineral Resource estimate is reported at a 53% Fe cut-off. The resource estimate has been compiled in accordance with the
guidelines defined in the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (The JORC Code, 2004
Edition).
The Mt Stuart Iron Ore Joint Venture (MSIOJV) is between Cullen - 30%, and the
In December 2010, Cullen reported the maiden JORC Ore Reserve Estimate for the Catho Well Channel Iron
unincorporated joint venture known as the Australian Premium Iron Joint Venture (APIJV)
Deposit based on the Resource Estimate .
- 70%. The APIJV comprises Aquila Steel Pty Ltd (a subsidiary of Aquila Resources
Limited (Aquila, ASX: AQA)) 50%, and AMCI (IO) Pty Ltd 50%. In July 2010, Aquila
MT STUART JOINT VENTURE (MSIOJV) ORE RESERVE ESTIMATE (CULLEN 30%)
reported the results of a Feasibility Study (FS) for the 30Mtpa West Pilbara Iron Ore
Project - Stage 1 indicating technical viability.
The Catho Well deposit is a potential component of the broader West Pilbara Iron Ore
Project (WPIOP). Ore derived from the Catho Well Deposit (MSIOJV) contributes to the
main, blended product stream maintaining an average 57.2% Fe throughout the
proposed 15 year mine life of the WPIOP - Stage 1 mining operations. The Mining
Feasibility Study (MFS) for Catho Well will include a scenario which assumes the
ownership of Cullen's run of mine ore will be transferred, after loading to trains, at the
“mine gate”. It is anticipated that, based on the MFS, the MSIOJV Participants will require
the JV Manager to submit a Development Proposal to the MSIOJV Participants and that
this, in turn, will lead to consideration of a Decision to Mine by the MSIOJV Participants.
A feasibility study for the mining of the Catho Well deposit was issued by the Manager in
May, 2012. As indicated to the ASX on the 7 June, 2012, Cullen does not accept that the
study is a feasability study under the definition in the MSIOJV agreement, mainly because
the development requires an infrastructure rail and port solution which has not yet been
Product
Category
Tonnes
Mt
Product 1
TOTAL
Proved
Probable
Total
Proved
Probable
Total
1
69
70
1
69
70
Fe
%
55.28
54.80
54.81
55.28
54.80
54.81
AI O2 3
%
3.33
3.23
3.23
3.33
3.23
3.23
SiO2
%
6.57
7.23
7.22
6.57
7.23
7.22
P
%
0.043
0.037
0.037
0.043
0.037
0.037
LOI
%
10.03
10.31
10.30
10.03
10.31
10.30
Competent Person Statement Resource
The information in this announcement that relates to Mineral Resources has been supervised by Mr Stuart Tuckey and Mr Richard Gaze who are
members of the Australasian Institute of Mining and Metallurgy. Mr Tuckey is a full-time employee of Australian Premium Iron. Mr Gaze is a full time
employee of Golder Associates Pty Ltd. Messrs Tuckey and Gaze have sufficient experience which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the 2004 Edition of the
'Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Tuckey and Mr Gaze consent to the inclusion in
the report of the matters based on their information in the form and context in which it appears.
approved.
Competent Person Statement Reserve
The information in this release that relates to Ore Reserves is based on information compiled by Mr Steve Craig, Managing Director of ORElogy
(Mining Consultants). Mr Craig is a Member of the Australasian Institute of Mining and Metallurgy 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 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Craig consents to the
inclusion of the matters based on his information in the form and context in which it appears in this release.
7
8
Exploration Review
Exploration Review
WYLOO AND PARABURDOO JVs – IRON
The Wyloo Project lies within Fortescue's proposed “Western Hub” mining centre, and just south of Cullen's, 30%-
owned Catho Well Channel Iron Deposit which is part of the West Pilbara Iron Ore Project – Stage 1. Fortescue can
earn up to an 80% interest in the iron ore rights on EL08/1393 and ELs 47/1154, 1649 and 1650. Fortescue has
provided a maiden Resource Estimate of 16.9Mt @ 57.11% Fe in a Bedded Iron Deposit at Wyloo South, in the
Inferred category, and has thereby earned 51%.
Fortescue can earn up to an 80% interest in the iron ore rights on Cullen's EL52/1667, located ~ 25km south east of
Paraburdoo in the Pilbara Region of Western Australia. The tenement includes potential for bedded iron deposits
within the Brockman Iron Formations, along strike from the Paraburdoo and Channar Groups of iron deposits.
TUNNEL CREEK JV – URANIUM
Fortescue completed a 26 hole RC drilling programme for 2150m with a best intersection of 5m @ 55.36% Fe with
follow-up drilling planned.
I n d i a n O c e a n
Port Hedland
API JV's proposed
railway and port
Dampier
Pannawonica
ANKETELL
POINT
Fortescue's
Western Hub
2017 - 60Mtpa
Solomon
Mt MacLeod
Delphine
Eliwana
Serenity
Sheila
Valley
Flying Fish
Tom Price
MT STUART JV
CATHO WELL CID
Hardey
PARABURDOO JV
Cullen/Fortescue
WYLOO JV
Cullen/Fortescue
Paraburdoo
Channar
Marble Bar
Cloudbreak
Christmas Creek
Nyudunghu
N
50 kilometres
Newman
The Company has a Joint Venture agreement with
Element 92 Pty Ltd, a wholly-owned subsidiary of
Thundelarra Exploration Ltd (Thundelarra), over its two
t e n e m e n t s ( E L s 5 2 / 1 8 9 0 , 1 8 9 2 ) a t T u n n e l
Creek/Kunderong, in the Ashburton Province. U3O8
Limited (U3O8) and Thundelarra have agreed for U3O8
to farm–in and take over management of two of the EL’s in
this Cullen/Thundelarra JV (EL52/1890 and EL52/1892).
U3O8 and Thundelarra can together earn 70%, with
Cullen to retain 30% in these two tenements, in what is
now called the Saltwater Pool JV. During the year U3O8
changed its name to Avocet, ASX : AYE.
At the Monster Prospect on EL52/1892 area, sampling
has returned up to 8.8g/t gold (Au), 150g/t silver (Ag) and
1.1% antimony (Sb). These samples are from a complex,
brecciated quartz vein system and were collected from a
small area over various parts of the veins. A total of 22
samples returned between 1.0 and 150g/t Ag, whilst 10
samples returned between 0.1g/t and 8.08g/t Au. A
review of radiometrics, electromagnetics and satellite
imagery is also on-going and this will be followed by a
detailed follow-up sampling and geological mapping
programme. Work to identify unconformity-related
uranium and orogenic gold deposits in Avocet’s projects
areas, including Tunnel Creek, is on-going.
Mt Whaleback
HARDEY JUNCTION JV – GOLD
Iron ore deposits
Existing railway
Proposed Solomon railway (Fortescue - 23/3/11)
Intrepid Mines Limited sold the Paulsens Gold Mine, located approximately 15km north of the Hardey Junction JV
Fortescue iron ore deposit
Existing Fortescue railway
Proposed Central Pilbara railway (Fortescue - 23/3/11)
Proposed railway (APIJV)
COMPETENT PERSONS STATEMENT – WYLOO JV
Mr. Stuart Robinson is a full-time employee of Fortescue Metals Group Ltd and Mr. Glassock recently resigned from the company. Both people
provided geological interpretations for Mineral Resource calculations and compiled the exploration results. Mr. Robinson, who is a Fellow of The
Australasian Institute of Mining and Metallurgy, and Mr. Glassock, who is a Member of The Australasian Institute of Mining and Metallurgy have
sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and the activity which they are
undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves”.
Mr. Robinson and Mr. Glassock consent to the inclusion in this report of the matters based on this information and in the form and context in which it
appears.
ground, to Northern Star Resources Ltd in a deal which included sale of their beneficial interest in the Hardey
Junction JV. Cullen holds a 20% Free Carried Interest to decision to mine based on a Bankable Feasibility study in
this Joint Venture. Northern Star has completed a 50m line spacing aeromagnetic/radiometric survey with
interpretation of data in progress. A targeting/ranking exercise now underway will determine the priority of future
exploration.
7
8
Exploration Review
Exploration Review
WYLOO AND PARABURDOO JVs – IRON
The Wyloo Project lies within Fortescue's proposed “Western Hub” mining centre, and just south of Cullen's, 30%-
owned Catho Well Channel Iron Deposit which is part of the West Pilbara Iron Ore Project – Stage 1. Fortescue can
earn up to an 80% interest in the iron ore rights on EL08/1393 and ELs 47/1154, 1649 and 1650. Fortescue has
provided a maiden Resource Estimate of 16.9Mt @ 57.11% Fe in a Bedded Iron Deposit at Wyloo South, in the
Inferred category, and has thereby earned 51%.
Fortescue can earn up to an 80% interest in the iron ore rights on Cullen's EL52/1667, located ~ 25km south east of
Paraburdoo in the Pilbara Region of Western Australia. The tenement includes potential for bedded iron deposits
within the Brockman Iron Formations, along strike from the Paraburdoo and Channar Groups of iron deposits.
TUNNEL CREEK JV – URANIUM
Fortescue completed a 26 hole RC drilling programme for 2150m with a best intersection of 5m @ 55.36% Fe with
follow-up drilling planned.
I n d i a n O c e a n
Port Hedland
API JV's proposed
railway and port
Dampier
Pannawonica
ANKETELL
POINT
Fortescue's
Western Hub
2017 - 60Mtpa
Solomon
Mt MacLeod
Delphine
Eliwana
Serenity
Sheila
Valley
Flying Fish
Tom Price
MT STUART JV
CATHO WELL CID
Hardey
PARABURDOO JV
Cullen/Fortescue
WYLOO JV
Cullen/Fortescue
Paraburdoo
Channar
Marble Bar
Cloudbreak
Christmas Creek
Nyudunghu
N
50 kilometres
Newman
The Company has a Joint Venture agreement with
Element 92 Pty Ltd, a wholly-owned subsidiary of
Thundelarra Exploration Ltd (Thundelarra), over its two
t e n e m e n t s ( E L s 5 2 / 1 8 9 0 , 1 8 9 2 ) a t T u n n e l
Creek/Kunderong, in the Ashburton Province. U3O8
Limited (U3O8) and Thundelarra have agreed for U3O8
to farm–in and take over management of two of the EL’s in
this Cullen/Thundelarra JV (EL52/1890 and EL52/1892).
U3O8 and Thundelarra can together earn 70%, with
Cullen to retain 30% in these two tenements, in what is
now called the Saltwater Pool JV. During the year U3O8
changed its name to Avocet, ASX : AYE.
At the Monster Prospect on EL52/1892 area, sampling
has returned up to 8.8g/t gold (Au), 150g/t silver (Ag) and
1.1% antimony (Sb). These samples are from a complex,
brecciated quartz vein system and were collected from a
small area over various parts of the veins. A total of 22
samples returned between 1.0 and 150g/t Ag, whilst 10
samples returned between 0.1g/t and 8.08g/t Au. A
review of radiometrics, electromagnetics and satellite
imagery is also on-going and this will be followed by a
detailed follow-up sampling and geological mapping
programme. Work to identify unconformity-related
uranium and orogenic gold deposits in Avocet’s projects
areas, including Tunnel Creek, is on-going.
Mt Whaleback
HARDEY JUNCTION JV – GOLD
Iron ore deposits
Existing railway
Proposed Solomon railway (Fortescue - 23/3/11)
Intrepid Mines Limited sold the Paulsens Gold Mine, located approximately 15km north of the Hardey Junction JV
Fortescue iron ore deposit
Existing Fortescue railway
Proposed Central Pilbara railway (Fortescue - 23/3/11)
Proposed railway (APIJV)
COMPETENT PERSONS STATEMENT – WYLOO JV
Mr. Stuart Robinson is a full-time employee of Fortescue Metals Group Ltd and Mr. Glassock recently resigned from the company. Both people
provided geological interpretations for Mineral Resource calculations and compiled the exploration results. Mr. Robinson, who is a Fellow of The
Australasian Institute of Mining and Metallurgy, and Mr. Glassock, who is a Member of The Australasian Institute of Mining and Metallurgy have
sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and the activity which they are
undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves”.
Mr. Robinson and Mr. Glassock consent to the inclusion in this report of the matters based on this information and in the form and context in which it
appears.
ground, to Northern Star Resources Ltd in a deal which included sale of their beneficial interest in the Hardey
Junction JV. Cullen holds a 20% Free Carried Interest to decision to mine based on a Bankable Feasibility study in
this Joint Venture. Northern Star has completed a 50m line spacing aeromagnetic/radiometric survey with
interpretation of data in progress. A targeting/ranking exercise now underway will determine the priority of future
exploration.
9
Exploration Review
Exploration Review
10
5
0
C
R
N
T
e
o
H
l
l
l
i
r
D
C
R
C 05
R
TN
C 17
R
TN
150m
405mRL
L
A
T
E
T
I
M
E
250m
205mRL
2 0 0 m e t
r e s
2
0
0
m
e
tr
e
s
350 metres
EOH144m
EOH200m
EOH250m
EOH150m
NT 1
TNRC05
TNRC07
EOH120m EOH156m
NT 2
EOH250m
TNRC08
620,000 mE
TNRC18
33°
Granite
2
d
n
a
1
T
N
s
e
i
l
a
m
o
n
A
TNRC02
M
E
T
V
TNRC16
TNRC17
M
35°
D h ole E
Late time EM anomaly/target
Completed RC drill hole
2
0
C
R
N
T
e
o
H
l
l
l
i
r
D
C
R
l
3
T
N
y
a
m
o
n
A
C 02
R
TN
C 16
R
TN
450mRL
144m
350mRL
200m
L
A
T
E
T
I
M
E
2
0
0
m
e
t
r
e
s
2 0 0 m e t r e s
EOH137m
V T E M
EOH200m
EOH174m
M
E
e
l
o
h
D
TNRC13
TNRC14
TNRC15
42°
610,000 mE
Late time EM anomaly/target
Completed RC drill hole
100 metres
6,982,500 mN
Colonel
TNRC13
TNRC14
NT 3
Mt Eelya
4
1
7
/
0
2
E
Eelya Felsic
Complex
Hollandaire
9.3m @ 15.4% Cu
E20/714
Rapier
Drill hole completed April 2012
Cullen tenement
Strong VTEM anomaly
Moderate VTEM anomaly
Weak VTEM anomaly
EM conductors (SLR’s Quarterly 17/1/2012)
VTEM anomalies to be tested
TNRC07
NT 2
Greenstone
NT 1
TNRC02
TNRC05
TNRC08
TNRC11
Granite
N
2.5 kilometres
NORTH TUCKABIANNA, WA – GOLD AND BASE METALS
The company completed a 7-hole, ~1000m RC scout drilling programme at its North Tuckabianna copper/gold
project which targeted three conductors (NT1-NT3) identified by a helicopter-borne EM survey (VTEM – 100-200m
line spacing). The VTEM survey was flown across the Eelya Complex and the northern section of the Tuckabianna
greenstone belt in Cullen's North Tuckabianna Project Area in March 2012.
The felsic Eelya Complex hosts the high-grade Hollandaire copper discovery of Silver Lake Resources Ltd (ASX:
SLR – 10 November 2011) as well as several other EM conductor targets, currently being explored by Silver Lake
Resources Ltd, including the Colonel and Mt Eelya prospects .
Cullen's drilling intersected disseminated sulphide (mainly pyrite and pyrrhotite, 1-20% visually identified over
intervals of 1-20m downhole) in mafic and felsic rocks at or near the modelled conductor plates from the VTEM
survey in all holes drilled. However, downhole surveys completed at each VTEM anomaly redefined the position of
the conductor plates and show that the conductive targets had been narrowly missed by the first pass drilling (see
Figures) and therefore had not been adequately tested.
The drill samples assays include a best result of 0.19% Cu and 0.21% Zn from 62-64m depth in drill hole TNRC14 at
the target NT3. The best gold result is 0.12g/t from 66-68m in drill hole TNRC11 at target NT2.
TABLE: PARAMETERS OF RE-MODELLED CONDUCTOR PLATES BASED ON
DOWNHOLE GEOPHYSICAL SURVEYS
EM
Anomaly
Down
hole Plate
Down dip
Extent (m)
Dip
(degrees)
Strike
length (m)
Azimuth
(degrees)
NT1
NT2
NT3
One
Two
One
One
146
350
214
42
51
35
33
42
49
200
115
22
126
139
128
194
These redefined conductor plates were tested in August 2012 with four RC holes (TNRC15-18) and intersected
zones of disseminated sulphide but with only geochemically anomalous assay results (maximum Cu - 1980ppm).
Several low-order VTEM anomalies remain to be investigated and tested, initially using A/C and/or RAB drilling (see
Figures).
9
Exploration Review
Exploration Review
10
5
0
C
R
N
T
e
o
H
l
l
l
i
r
D
C
R
C 05
R
TN
C 17
R
TN
150m
405mRL
L
A
T
E
T
I
M
E
250m
205mRL
2 0 0 m e t
r e s
2
0
0
m
e
tr
e
s
350 metres
EOH144m
EOH200m
EOH250m
EOH150m
NT 1
TNRC05
TNRC07
EOH120m EOH156m
NT 2
EOH250m
TNRC08
620,000 mE
TNRC18
33°
Granite
2
d
n
a
1
T
N
s
e
i
l
a
m
o
n
A
TNRC02
M
E
T
V
TNRC16
TNRC17
M
35°
D h ole E
Late time EM anomaly/target
Completed RC drill hole
2
0
C
R
N
T
e
o
H
l
l
l
i
r
D
C
R
l
3
T
N
y
a
m
o
n
A
C 02
R
TN
C 16
R
TN
450mRL
144m
350mRL
200m
L
A
T
E
T
I
M
E
2
0
0
m
e
t
r
e
s
2 0 0 m e t r e s
EOH137m
V T E M
EOH200m
EOH174m
M
E
e
l
o
h
D
TNRC13
TNRC14
TNRC15
42°
610,000 mE
Late time EM anomaly/target
Completed RC drill hole
100 metres
6,982,500 mN
Colonel
TNRC13
TNRC14
NT 3
Mt Eelya
4
1
7
/
0
2
E
Eelya Felsic
Complex
Hollandaire
9.3m @ 15.4% Cu
E20/714
Rapier
Drill hole completed April 2012
Cullen tenement
Strong VTEM anomaly
Moderate VTEM anomaly
Weak VTEM anomaly
EM conductors (SLR’s Quarterly 17/1/2012)
VTEM anomalies to be tested
TNRC07
NT 2
Greenstone
NT 1
TNRC02
TNRC05
TNRC08
TNRC11
Granite
N
2.5 kilometres
NORTH TUCKABIANNA, WA – GOLD AND BASE METALS
The company completed a 7-hole, ~1000m RC scout drilling programme at its North Tuckabianna copper/gold
project which targeted three conductors (NT1-NT3) identified by a helicopter-borne EM survey (VTEM – 100-200m
line spacing). The VTEM survey was flown across the Eelya Complex and the northern section of the Tuckabianna
greenstone belt in Cullen's North Tuckabianna Project Area in March 2012.
The felsic Eelya Complex hosts the high-grade Hollandaire copper discovery of Silver Lake Resources Ltd (ASX:
SLR – 10 November 2011) as well as several other EM conductor targets, currently being explored by Silver Lake
Resources Ltd, including the Colonel and Mt Eelya prospects .
Cullen's drilling intersected disseminated sulphide (mainly pyrite and pyrrhotite, 1-20% visually identified over
intervals of 1-20m downhole) in mafic and felsic rocks at or near the modelled conductor plates from the VTEM
survey in all holes drilled. However, downhole surveys completed at each VTEM anomaly redefined the position of
the conductor plates and show that the conductive targets had been narrowly missed by the first pass drilling (see
Figures) and therefore had not been adequately tested.
The drill samples assays include a best result of 0.19% Cu and 0.21% Zn from 62-64m depth in drill hole TNRC14 at
the target NT3. The best gold result is 0.12g/t from 66-68m in drill hole TNRC11 at target NT2.
TABLE: PARAMETERS OF RE-MODELLED CONDUCTOR PLATES BASED ON
DOWNHOLE GEOPHYSICAL SURVEYS
EM
Anomaly
Down
hole Plate
Down dip
Extent (m)
Dip
(degrees)
Strike
length (m)
Azimuth
(degrees)
NT1
NT2
NT3
One
Two
One
One
146
350
214
42
51
35
33
42
49
200
115
22
126
139
128
194
These redefined conductor plates were tested in August 2012 with four RC holes (TNRC15-18) and intersected
zones of disseminated sulphide but with only geochemically anomalous assay results (maximum Cu - 1980ppm).
Several low-order VTEM anomalies remain to be investigated and tested, initially using A/C and/or RAB drilling (see
Figures).
11
12
Exploration Review
Exploration Review
NORTH EASTERN GOLDFIELDS, WA
GUNBARREL – GOLD, NICKEL
EASTERN GOLDFIELDS, WA
KILLALOE – GOLD AND NICKEL
Cullen has been progressively reviewing the extensive database, and has undertaken field assessments of the
Cullen and Matsa Resources Limited ("Matsa") signed an agreement to allow Matsa to farm-in to Cullen's Killaloe
nickel and gold prospectivity of it's Gunbarrel greenstone belt project. Regional data and models for new minerals
Project near Norseman in W.A. (EL63/1018, EL63/1199 and PLs 63/1331-1333 and 1672). Matsa can earn a 70%
discoveries, such as “Rosie” – nickel, and “Garden Well” - gold, in the Duketon greenstone belt, have been taking into
interest in the Killaloe Project by agreeing to sole-fund exploration expenditure of $500,000 within 3 years of
consideration when identifying priority target areas for drilling at Gunbarrel as follows.
Wiluna
Mt Keith
Cliffs
Yakabindie
Cosmos
The northern and southern extensions of
the Eureka North West mineralization,
where previous intersections of gold in
conglomerate include 8m @ 2.92 g/t Au, is
interpreted to continue for some 10km to
the north under lake cover and has not
been tested by systematic drilling to date.
The northern and southern extension of the
Taipan shear zone - the Taipan target area
has a best drill intercept of 22m @ 2.1 g/t
Au, including 6m @ 5.0 g/t Au. It is a robust
mineralised system of quartz veining,
pyrite and carbonate alteration hosted by
sheared mafic schists over a strike length
of 700m and up to 100m wide (91m @ 0.3
g/t Au in "DDH1" from 133m) and open to
the north and south.
Nickel targets include: "AK47" (0.2m @
1.93% Ni from 140m) where further EM and
drilling is required; the eastern untested
RAB anomaly (11m @ 0.86 % Ni), where
Horse Well
Jundee
(4 Moz Au)
P
r
o
t
e
r
o
z
o
i
c
GUNBARREL
Mt Fisher
Collurabbie
Mt Mcclure
Bronzewing
(2.5moz Au)
Melrose
Rosie
Moolart
Well
Perserverance
Darlot (2 Moz Au)
Waterloo
Yi l g a r n C r a t o n
( A r c h e a n )
Garden
Well
Mt Windarra
Laverton
ground EM is planned; and several VTEM
N
and ground EM anomalies near “GBD 15”
40 kilometres
Leonora
(0.5m @ 0.95% Ni) where further RC
drilling is required. Field reconnaissance is
in progress and heritage clearance surveys
are being planned.
Granitoid rocks
Greenstone belt
Sediments
Ultramafics
/
Nickel / Gold occurence
and prospects
Road, town
Cullen tenement
satisfaction of the conditions precedent. Matsa can terminate the agreement at any time after incurring a minimum
$100,000 of exploration expenditure. Matsa has completed data compilation and review and has outlined a number
of targets for further exploration.
FORRESTANIA, WA – GOLD, NICKEL AND IRON
Cullen holds a 20% Free Carried Interest in the western portion of Hannans Reward
Limited (Hannans) Stormbreaker Prospect, centred ~12km north of the Flying Fox
Nickel Mine in the Forrestania Greenstone Belt. Hannans completed 2000m RC drilling
programme in September 2011 targeting a surface TEM anomaly and interpreted
ultramafic lithologies for nickel sulphides, but did not detect any significant anomalies. In
addition, Hannans has identified an iron ore prospective Banded Iron Formation where it
plans to carry out a programme of RC drilling to follow-up on iron-rich rock chip sample
assays and a pervious intersection in drillhole “FSRC035” (35m @ 47.5% Fe).
11
12
Exploration Review
Exploration Review
NORTH EASTERN GOLDFIELDS, WA
GUNBARREL – GOLD, NICKEL
EASTERN GOLDFIELDS, WA
KILLALOE – GOLD AND NICKEL
Cullen has been progressively reviewing the extensive database, and has undertaken field assessments of the
Cullen and Matsa Resources Limited ("Matsa") signed an agreement to allow Matsa to farm-in to Cullen's Killaloe
nickel and gold prospectivity of it's Gunbarrel greenstone belt project. Regional data and models for new minerals
Project near Norseman in W.A. (EL63/1018, EL63/1199 and PLs 63/1331-1333 and 1672). Matsa can earn a 70%
discoveries, such as “Rosie” – nickel, and “Garden Well” - gold, in the Duketon greenstone belt, have been taking into
interest in the Killaloe Project by agreeing to sole-fund exploration expenditure of $500,000 within 3 years of
consideration when identifying priority target areas for drilling at Gunbarrel as follows.
Wiluna
Mt Keith
Cliffs
Yakabindie
Cosmos
The northern and southern extensions of
the Eureka North West mineralization,
where previous intersections of gold in
conglomerate include 8m @ 2.92 g/t Au, is
interpreted to continue for some 10km to
the north under lake cover and has not
been tested by systematic drilling to date.
The northern and southern extension of the
Taipan shear zone - the Taipan target area
has a best drill intercept of 22m @ 2.1 g/t
Au, including 6m @ 5.0 g/t Au. It is a robust
mineralised system of quartz veining,
pyrite and carbonate alteration hosted by
sheared mafic schists over a strike length
of 700m and up to 100m wide (91m @ 0.3
g/t Au in "DDH1" from 133m) and open to
the north and south.
Nickel targets include: "AK47" (0.2m @
1.93% Ni from 140m) where further EM and
drilling is required; the eastern untested
RAB anomaly (11m @ 0.86 % Ni), where
Horse Well
Jundee
(4 Moz Au)
P
r
o
t
e
r
o
z
o
i
c
GUNBARREL
Mt Fisher
Collurabbie
Mt Mcclure
Bronzewing
(2.5moz Au)
Melrose
Rosie
Moolart
Well
Perserverance
Darlot (2 Moz Au)
Waterloo
Yi l g a r n C r a t o n
( A r c h e a n )
Garden
Well
Mt Windarra
Laverton
ground EM is planned; and several VTEM
N
and ground EM anomalies near “GBD 15”
40 kilometres
Leonora
(0.5m @ 0.95% Ni) where further RC
drilling is required. Field reconnaissance is
in progress and heritage clearance surveys
are being planned.
Granitoid rocks
Greenstone belt
Sediments
Ultramafics
/
Nickel / Gold occurence
and prospects
Road, town
Cullen tenement
satisfaction of the conditions precedent. Matsa can terminate the agreement at any time after incurring a minimum
$100,000 of exploration expenditure. Matsa has completed data compilation and review and has outlined a number
of targets for further exploration.
FORRESTANIA, WA – GOLD, NICKEL AND IRON
Cullen holds a 20% Free Carried Interest in the western portion of Hannans Reward
Limited (Hannans) Stormbreaker Prospect, centred ~12km north of the Flying Fox
Nickel Mine in the Forrestania Greenstone Belt. Hannans completed 2000m RC drilling
programme in September 2011 targeting a surface TEM anomaly and interpreted
ultramafic lithologies for nickel sulphides, but did not detect any significant anomalies. In
addition, Hannans has identified an iron ore prospective Banded Iron Formation where it
plans to carry out a programme of RC drilling to follow-up on iron-rich rock chip sample
assays and a pervious intersection in drillhole “FSRC035” (35m @ 47.5% Fe).
13
14
Exploration Review
Exploration Review
KIMBERLEY, WA
CANNING BASIN JV – COAL
Cullen has signed a Heads of Agreement (HOA) with Advaita Canning Resources Pty Ltd, a subsidiary of a private,
Singapore-based, energy-focused, investment company Advaita Power Resources Pte Ltd. Advaita's goal is to
become a preferred fuel supply partner for Indian power producers and has mandates for coal supply from several
power companies setting up over 10 Giga Watts of imported coal-based power capacity in India.
Advaita commenced a RC drilling program over the granted Canning Basin JV tenements, in mid - July 2011. A
series of drill holes perpendicular to the strike of the regional geology was completed, to gain an understanding of the
stratigraphy, and to explore for the coal-bearing horizons.
The results of the 23 holes, 4246m drilled showed the presence of coal in 4 holes, with coal seams intersections
ranging from 0.19m to 1.55m recorded. Further drilling is planned for the 2012/2013 season.
CENTRAL LACHLAN FOLD BELT, NSW
MINTER – TUNGSTEN
A combined RC percussion-diamond drilling programme totalling 536.8 metres in three holes was undertaken on the
Minter project in June 2012 testing selected geological/geochemical targets at the Doyenwae and Orr Trig
prospects. Holes were designed to test beneath zones of anomalous tungsten and tin geochemistry outlined by
earlier soil sampling and shallow percussion/aircore/RAB drilling.
At the Doyenwae Prospect, RC percussion hole MRC005 averaged 447ppm tungsten over the full 111 metre length
of the hole with localised two-metre zones of quartz-scheelite veining assaying up to 0.35% tungsten. Diamond drill
hole CMDD001, drilled to 258.0 metres at the Doyenwae prospect, intersected significant quartz + sulphide veining
throughout much of the hole. Examination of the core with an ultraviolet lamp detected widespread scheelite
mineralisation occurring both within quartz veins and as disseminations/aggregates in silica-altered sandstone
units; particularly in the interval from 130 metres to the end of the hole. The true width of potential mineralisation in
both MRC005 and CMDD001 is uncertain as preliminary observations of vein orientations in the CMDD001 drill core
indicate that the holes may be drilling at a low angle to some of the mineralised quartz veins, assays pending.
At the Orr Trig Prospect, diamond core hole CMDD002; drilled to 267.8 metres, intersected scattered zones of
narrow quartz veining and localised silicification over much of the hole with scheelite being observed as
disseminations in sandstone and within quartz veins in the interval between 100m and 250m. Although it would
appear that hole CMDD002 has been drilled in an appropriate direction with respect to the orientation of the quartz
veins, the amount of observable scheelite mineralisation is less than that noted in CMDD001. The results included:
1m @ 0.7% WO (from 131.45m), 1.4m @ 1.36% WO (from 232.7m), and 4.05m @ 0.58% WO (from 185m) in
3
3
3
QUEENSLAND
GALILEE AND EROMANGA BASINS – COAL
Photograph: Porcupine Gorge north of Hughenden
Montrose Resources Pty Limited, a wholly-owned subsidiary, holds applications for coal in the Millungera Basin
(EPCAs 2222, 2227, 2244, and 2247), Eromanga/Galilee Basin - Winton area (EPCAs 2628, 2629, 2630, and 2632)
and in the Galilee Basin. Montrose's two tenements near Hughenden (EPCs 2226 and 2236) are now granted. In this
latter area, three targets for coal have been interpreted from aeromagnetic data for further exploration. Montrose is
CMDD001.
Hole ID
Prospect
Drilling
Method
Easting
(MGA)
Northing
(MGA)
Azimuth
(MGA)
Azimuth
(Magnetic)
Collar
Dip
Final
Depth (m)
MRC005
Doyenwae
RCP
455919
6311235
CMDD001 Doyenwae
Diamond
455598
6311188
CMDD002
Orr Trig
Diamond
456112
6316919
102 0
102 0
95 0
90 0
90 0
83 0
- 55
- 55
- 50
111
258 .0
267.8
seeking to farm-out its Hughenden tenure.
An area of interest west of Winton has been developed
where a water bore, “WB2498” , intersected 193.5m
(from 112.8m to 306.3 EoH) of “shale and coal” that is
interpreted to be Cretaceous Winton Formation.
Petroleum wells in the same region include “McQueen
#1”, that intersected 4m of shale and coal (164 -168m)
and “Cork #1”, that intersected 5m of shale and coal
(380-385m; 80% coal) within a broader carbonaceous
(trace, to 20% coal) sediment sequence from 60-420m
down hole. Cullen has applied for four EPCAs covering
“WB2498” and extensions north and south towards the
McQueen and Cork drill collars (now under
applications by another company).
Photograph: Camels travelling on Hughenden-Winton Road
Photographs of core sections from CMDD001 @ 188.15m under normal and UV light –
showing scheelite in clast
13
14
Exploration Review
Exploration Review
KIMBERLEY, WA
CANNING BASIN JV – COAL
Cullen has signed a Heads of Agreement (HOA) with Advaita Canning Resources Pty Ltd, a subsidiary of a private,
Singapore-based, energy-focused, investment company Advaita Power Resources Pte Ltd. Advaita's goal is to
become a preferred fuel supply partner for Indian power producers and has mandates for coal supply from several
power companies setting up over 10 Giga Watts of imported coal-based power capacity in India.
Advaita commenced a RC drilling program over the granted Canning Basin JV tenements, in mid - July 2011. A
series of drill holes perpendicular to the strike of the regional geology was completed, to gain an understanding of the
stratigraphy, and to explore for the coal-bearing horizons.
The results of the 23 holes, 4246m drilled showed the presence of coal in 4 holes, with coal seams intersections
ranging from 0.19m to 1.55m recorded. Further drilling is planned for the 2012/2013 season.
CENTRAL LACHLAN FOLD BELT, NSW
MINTER – TUNGSTEN
A combined RC percussion-diamond drilling programme totalling 536.8 metres in three holes was undertaken on the
Minter project in June 2012 testing selected geological/geochemical targets at the Doyenwae and Orr Trig
prospects. Holes were designed to test beneath zones of anomalous tungsten and tin geochemistry outlined by
earlier soil sampling and shallow percussion/aircore/RAB drilling.
At the Doyenwae Prospect, RC percussion hole MRC005 averaged 447ppm tungsten over the full 111 metre length
of the hole with localised two-metre zones of quartz-scheelite veining assaying up to 0.35% tungsten. Diamond drill
hole CMDD001, drilled to 258.0 metres at the Doyenwae prospect, intersected significant quartz + sulphide veining
throughout much of the hole. Examination of the core with an ultraviolet lamp detected widespread scheelite
mineralisation occurring both within quartz veins and as disseminations/aggregates in silica-altered sandstone
units; particularly in the interval from 130 metres to the end of the hole. The true width of potential mineralisation in
both MRC005 and CMDD001 is uncertain as preliminary observations of vein orientations in the CMDD001 drill core
indicate that the holes may be drilling at a low angle to some of the mineralised quartz veins, assays pending.
At the Orr Trig Prospect, diamond core hole CMDD002; drilled to 267.8 metres, intersected scattered zones of
narrow quartz veining and localised silicification over much of the hole with scheelite being observed as
disseminations in sandstone and within quartz veins in the interval between 100m and 250m. Although it would
appear that hole CMDD002 has been drilled in an appropriate direction with respect to the orientation of the quartz
veins, the amount of observable scheelite mineralisation is less than that noted in CMDD001. The results included:
1m @ 0.7% WO (from 131.45m), 1.4m @ 1.36% WO (from 232.7m), and 4.05m @ 0.58% WO (from 185m) in
3
3
3
QUEENSLAND
GALILEE AND EROMANGA BASINS – COAL
Photograph: Porcupine Gorge north of Hughenden
Montrose Resources Pty Limited, a wholly-owned subsidiary, holds applications for coal in the Millungera Basin
(EPCAs 2222, 2227, 2244, and 2247), Eromanga/Galilee Basin - Winton area (EPCAs 2628, 2629, 2630, and 2632)
and in the Galilee Basin. Montrose's two tenements near Hughenden (EPCs 2226 and 2236) are now granted. In this
latter area, three targets for coal have been interpreted from aeromagnetic data for further exploration. Montrose is
CMDD001.
Hole ID
Prospect
Drilling
Method
Easting
(MGA)
Northing
(MGA)
Azimuth
(MGA)
Azimuth
(Magnetic)
Collar
Dip
Final
Depth (m)
MRC005
Doyenwae
RCP
455919
6311235
CMDD001 Doyenwae
Diamond
455598
6311188
CMDD002
Orr Trig
Diamond
456112
6316919
102 0
102 0
95 0
90 0
90 0
83 0
- 55
- 55
- 50
111
258 .0
267.8
seeking to farm-out its Hughenden tenure.
An area of interest west of Winton has been developed
where a water bore, “WB2498” , intersected 193.5m
(from 112.8m to 306.3 EoH) of “shale and coal” that is
interpreted to be Cretaceous Winton Formation.
Petroleum wells in the same region include “McQueen
#1”, that intersected 4m of shale and coal (164 -168m)
and “Cork #1”, that intersected 5m of shale and coal
(380-385m; 80% coal) within a broader carbonaceous
(trace, to 20% coal) sediment sequence from 60-420m
down hole. Cullen has applied for four EPCAs covering
“WB2498” and extensions north and south towards the
McQueen and Cork drill collars (now under
applications by another company).
Photograph: Camels travelling on Hughenden-Winton Road
Photographs of core sections from CMDD001 @ 188.15m under normal and UV light –
showing scheelite in clast
15
16
Exploration Review
Exploration Review
Scandinavia
Scandinavia
SWEDEN AND FINLAND –
GOLD, COPPER , IRON
Cullen holds two exploration licenes in Sweden near Kiruna, and in late 2010,
Cullen initiated exploration in the Kuusamo greenstone belt of far north eastern
Finland adjacent to the Juomasuo deposit (1.95Mt @ 4.9 g/t Au) of Dragon Mining
Limited. Dragon has announced total resources in its Kuusamo project area of 3.4
Mt @ 4.2 g/t Au (460,700 oz), with historical, bonanza grade drill intersections at
Juomasuo including: 57.3m @ 62.56 g/t Au and 5.30m @ 206.85 g/t Au
(www.dragon-mining.com.au).
During 2011, Cullen reviewed geological databases for the Proterozoic
greenstone belts of northern Finland to identify other opportunities for effective
application of the biogeochemical approach, in which Cullen is building its
expertise. Cullen, through its wholly-owned Finnish registered subsidiary, has
now applied for ~750 km of prospective ground in the greenstone belts that host
2
the Kittila gold deposit (Agnico – Eagle, 5 Moz of Reserves, www.agnico-
eagle.com); and the Rompas prospect (Mawson Resources Ltd – Rompas is a
discovery with bonanza gold grades in surface channel samples including: 0.3m
@ 1,866g/t Au and 8.0% U, and 0.26m @ 1,510g/t Au and 3.95% U
(www.mawsonresources.com). Cullen plans biogeochemical surveying across
these new project areas and ground follow-up of any anomalies in 2012/2013.
In June 2012, Cullen completed a detailed biogeochemical survey (275 samples)
on its Exploration Licence application directly north of Dragon's
FINLAND –
GRAPHITE
In early 2012, Cullen commenced a review of graphite opportunities in Finland following the release of information by
Talga Gold Limited (ASX:TLG) concerning the Nunasvaara graphite deposit in northern Sweden, which currently
contains a JORC - compliant inferred Mineral Resource of 3.6 Mt @ 23% C (see TLG's ASX release, 28 February
2012).
Cullen has lodged three Ore Prospecting Licence applications (Exploration Licence equivalents) and four Claim
Reservation applications over six graphite prospects in the name of its wholly-owned, Finnish-registered subsidiary
company. These prospects have previously been explored for graphite and/or base metals by the Geological
Survey of Finland (Geologian Tutkimuskeskus or GTK) and companies, mostly in the period 1970-2000. The
historic work done by GTK was aimed at the potential of graphite as a fuel source. Graphite's metallurgical
characteristics for other industrial uses were not, or only partly, investigated. Existing databases for these graphite
prospects include aerial and ground geophysical surveys, geological maps and diamond drill cores stored at the
Geological Survey of Finland.
The major strategic advantages of Cullen's Finnish graphite portfolio are:
Location in a first world country with very good infrastructure and a well-educated and trained workforce;
Existing, accessible data and drill core material that will allow rapid evaluation and determination of potential;
Proximity to potential graphite markets in Europe; and,
Advanced prospects with indications of potential multi-million tonne Exploration Targets in the range of 1 to 5 Mt
1
@ 5 to 20% C of amorphous to flake-size graphite from work completed to date.
Cullen may begin work on these prospects now, during the application stage of the licences and the life of the claim
reservations (two years), by examining the drill cores in Finland, re-sampling and analysing parts of the core, and re-
assessing the drill and geophysical databases. This work will commence as soon as possible and will lead to a rapid
prioritization of the portfolio.
Cullen will also work to find an off-take partner for the graphite at an early stage and would then prioritize further
activities, including drilling for resource estimation, accordingly.
TABLE: SUMMARY OF GRAPHITE PROSPECT AREAS APPLIED FOR BY CULLEN IN FINLAND
PROJECT
AREA
APPLICATION
TYPE
KOLARI
Claim Reservation
Ore Prospecting
Licence
SIZE
(km )2
13.8
5.5
HISTORIC DRILL HOLES
COMMENTS
8 diamond drill holes
(1918-1985) Rautaruukki
Oy, Kiiruna AB, GTK
32 diamond drill holes
(1996-1997) GTK
4 diamond drill holes
(1983) GTK
13 diamond drill holes
(1972-1983) GTK
15 diamond drill holes
(1983-1992)
GTK, Outokumpu, Oy
75 diamond drill holes
(1955-2006) GTK,
Rautaruukki Oy, Lapin
Malmi Oy
Flaky graphite reported
Hole R303
29m @ 18% C from 13m depth
(estimated from cross section)
Hole R430
14.6m @ 31.8% C from 48.5m
Hole R336
7.6m @ 34.8% C from 7.4m;
Hole R331
99.55m @ 12.1% C from 5m
Competing application
Kuusamo/Juomasuo gold project, as well as from an area south, along strike of
TUNTURI
Claim Reservation
99.12
the prospective lithologies.
1
EXPLORATION TARGETS
The term Exploration Target where used herein is conceptual in nature and there has been insufficient exploration to define
a Mineral Resource, and it is uncertain if further exploration will result in the determination of a Mineral Resource under the
Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, the JORC Code (2004).
The Exploration Target is not being reported as part of any Mineral Resource or Ore Reserve
POLVELA
Ore Prospecting
Licence
VIISTOLA /
HYYPIÄ
Ore Prospecting
Licence
9.2
1.36
AITOO
Claim Reservation
187.11
MISI
Claim Reservation
170.56
GTK = The Geological Survey of Finland (Geologian Tutkimuskeskus)
AR
CTEX
B
A
15
16
Exploration Review
Exploration Review
Scandinavia
Scandinavia
SWEDEN AND FINLAND –
GOLD, COPPER , IRON
Cullen holds two exploration licenes in Sweden near Kiruna, and in late 2010,
Cullen initiated exploration in the Kuusamo greenstone belt of far north eastern
Finland adjacent to the Juomasuo deposit (1.95Mt @ 4.9 g/t Au) of Dragon Mining
Limited. Dragon has announced total resources in its Kuusamo project area of 3.4
Mt @ 4.2 g/t Au (460,700 oz), with historical, bonanza grade drill intersections at
Juomasuo including: 57.3m @ 62.56 g/t Au and 5.30m @ 206.85 g/t Au
(www.dragon-mining.com.au).
During 2011, Cullen reviewed geological databases for the Proterozoic
greenstone belts of northern Finland to identify other opportunities for effective
application of the biogeochemical approach, in which Cullen is building its
expertise. Cullen, through its wholly-owned Finnish registered subsidiary, has
now applied for ~750 km of prospective ground in the greenstone belts that host
2
the Kittila gold deposit (Agnico – Eagle, 5 Moz of Reserves, www.agnico-
eagle.com); and the Rompas prospect (Mawson Resources Ltd – Rompas is a
discovery with bonanza gold grades in surface channel samples including: 0.3m
@ 1,866g/t Au and 8.0% U, and 0.26m @ 1,510g/t Au and 3.95% U
(www.mawsonresources.com). Cullen plans biogeochemical surveying across
these new project areas and ground follow-up of any anomalies in 2012/2013.
In June 2012, Cullen completed a detailed biogeochemical survey (275 samples)
on its Exploration Licence application directly north of Dragon's
FINLAND –
GRAPHITE
In early 2012, Cullen commenced a review of graphite opportunities in Finland following the release of information by
Talga Gold Limited (ASX:TLG) concerning the Nunasvaara graphite deposit in northern Sweden, which currently
contains a JORC - compliant inferred Mineral Resource of 3.6 Mt @ 23% C (see TLG's ASX release, 28 February
2012).
Cullen has lodged three Ore Prospecting Licence applications (Exploration Licence equivalents) and four Claim
Reservation applications over six graphite prospects in the name of its wholly-owned, Finnish-registered subsidiary
company. These prospects have previously been explored for graphite and/or base metals by the Geological
Survey of Finland (Geologian Tutkimuskeskus or GTK) and companies, mostly in the period 1970-2000. The
historic work done by GTK was aimed at the potential of graphite as a fuel source. Graphite's metallurgical
characteristics for other industrial uses were not, or only partly, investigated. Existing databases for these graphite
prospects include aerial and ground geophysical surveys, geological maps and diamond drill cores stored at the
Geological Survey of Finland.
The major strategic advantages of Cullen's Finnish graphite portfolio are:
Location in a first world country with very good infrastructure and a well-educated and trained workforce;
Existing, accessible data and drill core material that will allow rapid evaluation and determination of potential;
Proximity to potential graphite markets in Europe; and,
Advanced prospects with indications of potential multi-million tonne Exploration Targets in the range of 1 to 5 Mt
1
@ 5 to 20% C of amorphous to flake-size graphite from work completed to date.
Cullen may begin work on these prospects now, during the application stage of the licences and the life of the claim
reservations (two years), by examining the drill cores in Finland, re-sampling and analysing parts of the core, and re-
assessing the drill and geophysical databases. This work will commence as soon as possible and will lead to a rapid
prioritization of the portfolio.
Cullen will also work to find an off-take partner for the graphite at an early stage and would then prioritize further
activities, including drilling for resource estimation, accordingly.
TABLE: SUMMARY OF GRAPHITE PROSPECT AREAS APPLIED FOR BY CULLEN IN FINLAND
PROJECT
AREA
APPLICATION
TYPE
KOLARI
Claim Reservation
Ore Prospecting
Licence
SIZE
(km )2
13.8
5.5
HISTORIC DRILL HOLES
COMMENTS
8 diamond drill holes
(1918-1985) Rautaruukki
Oy, Kiiruna AB, GTK
32 diamond drill holes
(1996-1997) GTK
4 diamond drill holes
(1983) GTK
13 diamond drill holes
(1972-1983) GTK
15 diamond drill holes
(1983-1992)
GTK, Outokumpu, Oy
75 diamond drill holes
(1955-2006) GTK,
Rautaruukki Oy, Lapin
Malmi Oy
Flaky graphite reported
Hole R303
29m @ 18% C from 13m depth
(estimated from cross section)
Hole R430
14.6m @ 31.8% C from 48.5m
Hole R336
7.6m @ 34.8% C from 7.4m;
Hole R331
99.55m @ 12.1% C from 5m
Competing application
Kuusamo/Juomasuo gold project, as well as from an area south, along strike of
TUNTURI
Claim Reservation
99.12
the prospective lithologies.
1
EXPLORATION TARGETS
The term Exploration Target where used herein is conceptual in nature and there has been insufficient exploration to define
a Mineral Resource, and it is uncertain if further exploration will result in the determination of a Mineral Resource under the
Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, the JORC Code (2004).
The Exploration Target is not being reported as part of any Mineral Resource or Ore Reserve
POLVELA
Ore Prospecting
Licence
VIISTOLA /
HYYPIÄ
Ore Prospecting
Licence
9.2
1.36
AITOO
Claim Reservation
187.11
MISI
Claim Reservation
170.56
GTK = The Geological Survey of Finland (Geologian Tutkimuskeskus)
AR
CTEX
B
A
17
18
Exploration Review
Exploration Review
Canada
Canada
BRITISH COLUMBIA, TL PROPERTY –
BASE METALS
Early in 2011, Cullen signed an agreement
with a Vancouver-based private prospecting
syndicate whereby Cullen may earn an 80%
interest in the TL Property located in south-
east British Columbia, Canada. Cullen has
subsequently explored the property primarily
for base metals with considerable early
success.
In May and June 2011, Cullen dug three
trenches to test geochemical anomalies
which returned a best result of 3m @ 8.98%
Zn from channel samples, with highly
anomalous molybdenum (maximum 1339 ppm) and rhenium (maximum 580
ppb), copper, bismuth, nickel, tin, and tungsten. The trenches exposed an
assemblage of calcsilicate-marble, quartzite, biotite-garnet-schist and
paragneiss. During October 2011, Cullen flew a HeliTEM (helicopter borne EM)
survey across the entire TL project area in order to characterize the known
“Trench” mineralization and prioritise targets. The survey identified a very strong,
~6000m long conductor trending east-west beyond the trench site – see Figure.
During a field visit in June 2012, ~100 organic soil samples were taken from an
area immediately south of the TL gossan-trench site. Zinc, molybedenum and
mercury geochemical anomalies show a prominent southeasterly trend
coincident with magnetic and EM anomalies over approximately 400m and open
to the northwest. A diamond drilling programme in the trenched area is
scheduled for September 2012.
Cullen's trenches also exposed graphite-bearing schists and graphitic-sulphidic
masses (see photos) including coarse-grained “flake” graphite. Furthermore, a
showing of “crystalline flake graphite” is recorded near Mabel Lake ~ 5km west of
the TL Property boundary in the “MINFILE” database of the BC Geological
Survey. The host lithology to this occurrence near Mabel Lake is interpreted by
Cullen to be part of the same stratigraphy that occurs within the TL Property.
Lake
Lake
Mabel
Mabel
Occurrence of
Flake Graphite
(MINFILE)
Trenches with graphite -
pyrrhotite - pyrite and zinc mineralisation
(3m @ 8.98% Zn) at surface and
exposed graphitic schists
C A N A D A
5
0
5
0
5
2
7
5
5
1
0
5
1
0
1
5
0
1
1
0
0
1 5
0
1
N
2 kilometres
Graphite is well-known to be highly conductive and commonly the source of airborne EM anomalies. It is possible
therefore, that the large EM conductor (~6km in length) within the TL Property indicates a mixed sulphide/graphite-
bearing rock unit. Sulphide/graphite development may be concentrated in favourable structural positions within this
unit. Further fieldwork and sampling is planned for this field season.
17
18
Exploration Review
Exploration Review
Canada
Canada
BRITISH COLUMBIA, TL PROPERTY –
BASE METALS
Early in 2011, Cullen signed an agreement
with a Vancouver-based private prospecting
syndicate whereby Cullen may earn an 80%
interest in the TL Property located in south-
east British Columbia, Canada. Cullen has
subsequently explored the property primarily
for base metals with considerable early
success.
In May and June 2011, Cullen dug three
trenches to test geochemical anomalies
which returned a best result of 3m @ 8.98%
Zn from channel samples, with highly
anomalous molybdenum (maximum 1339 ppm) and rhenium (maximum 580
ppb), copper, bismuth, nickel, tin, and tungsten. The trenches exposed an
assemblage of calcsilicate-marble, quartzite, biotite-garnet-schist and
paragneiss. During October 2011, Cullen flew a HeliTEM (helicopter borne EM)
survey across the entire TL project area in order to characterize the known
“Trench” mineralization and prioritise targets. The survey identified a very strong,
~6000m long conductor trending east-west beyond the trench site – see Figure.
During a field visit in June 2012, ~100 organic soil samples were taken from an
area immediately south of the TL gossan-trench site. Zinc, molybedenum and
mercury geochemical anomalies show a prominent southeasterly trend
coincident with magnetic and EM anomalies over approximately 400m and open
to the northwest. A diamond drilling programme in the trenched area is
scheduled for September 2012.
Cullen's trenches also exposed graphite-bearing schists and graphitic-sulphidic
masses (see photos) including coarse-grained “flake” graphite. Furthermore, a
showing of “crystalline flake graphite” is recorded near Mabel Lake ~ 5km west of
the TL Property boundary in the “MINFILE” database of the BC Geological
Survey. The host lithology to this occurrence near Mabel Lake is interpreted by
Cullen to be part of the same stratigraphy that occurs within the TL Property.
Lake
Lake
Mabel
Mabel
Occurrence of
Flake Graphite
(MINFILE)
Trenches with graphite -
pyrrhotite - pyrite and zinc mineralisation
(3m @ 8.98% Zn) at surface and
exposed graphitic schists
C A N A D A
5
0
5
0
5
2
7
5
5
1
0
5
1
0
1
5
0
1
1
0
0
1 5
0
1
N
2 kilometres
Graphite is well-known to be highly conductive and commonly the source of airborne EM anomalies. It is possible
therefore, that the large EM conductor (~6km in length) within the TL Property indicates a mixed sulphide/graphite-
bearing rock unit. Sulphide/graphite development may be concentrated in favourable structural positions within this
unit. Further fieldwork and sampling is planned for this field season.
19
20
Exploration Review
Exploration Review
PEACE RIVER COALFIELD, BRITISH COLUMBIA –
TSUMEB AND KALAHARI COPPER BELT –
Namibia
Namibia
COAL
In early 2012, Cullen initiated a review of the Peace River Coalfield of north-east British Columbia. This is a prime
metallurgical coalfield with a number of producing mines and major mining companies involved in exploration and
acquisition of assets (see Figure). As a result, Cullen, through its wholly-owned Canadian subsidiary, has applied for
~100 km of tenements over an under explored trend of Gething Formation west of Pink Mountain (see Figure). The
2
area adjoins a large Anglo application (January 2012) to the south and east. Anglo mines coal in the Peace River
Coalfield at Trend near Tumbler Ridge. This is an exciting exploration initiative where Cullen can apply first pass
mapping and geochemical techniques in a fairly accessible environment in the summer months (May – October),
once the applications are approved.
Trutch
To Fort Nelson
Cullen Applications
Pink Mountain
Anglo
American plc
C A N A D A
N
25 kilometres
/
Coal mine / prospect
Road, Rail
Town
Jameson
(ASX: JAL )
Fort St. John
Hudson's
Hope
Dawson Creek
Peace River Coalfield
(Met-coal / Thermal)
Chetwynd
WILLOW CREEK
COPPER, REE, AND BASE METALS
KAROO BASIN – COAL
Cullen Resources Namibia (Pty) Ltd has an exploration presence in Namibia,
south-west Africa. Cullen Namibia has to date: lodged applications for ~ 8,000 km
2
of prospective ground in Namibia; targeting large, sediment-hosted, African copper
belt-type deposits; Tsumeb-type base metal deposits and Rare Earth Elements
(REEs) in carbonatites. Five EPL applications, two near Tsumeb and three east of
Windhoek, prospective for copper, have now been granted. Cullen has purchased
aeromagnetics data and has completed stratigraphic and structural interpretation.
A field review has been completed and rapid assessment by geochemistry and/or
stratigraphic drilling can commence.
Cullen Resources Namibia (Pty) Limited, has also applied for five Exclusive
Prospecting Licences for coal in the Aranos Basin of southern Namibia. This basin
hosts the Aranos Coal deposit, but little regional exploration appears to have been
undertaken on the western margin of the basin. Cullen has generated these
projects on the basis of the known coal prospectivity of the Karoo Basin. The
applications are expected to be processed in the second half of 2012.
72 Mt @ 4.3% Cu
Produced
3475sq km
N A M I B I A
Tsumeb
Witvlei
13 Mt @ 1.85% Cu
Oamites
6.5 Mt @ 1.3% Cu
12g/t Ag Produced
Walvis Bay
Windhoek
4700sq km
Gobabis
Dordabis
2 Mt @ 0.98% Cu
Aranos
Coal
Deposit
Klein Aub
5.5 Mt @ 2% Cu
50g/t Ag Produced
Boseto
111 Mt @ 1.4% Cu,
17.6 g/t Ag
N
200 kilometres
Maun
Boseto
Copper Project
(Discovery
Minerals Limited)
Francistown
B O T S W A N A
Gaborone
Johannesburg
S O U T H A F R I C A
Cullen EPLs granted
(Base and precious metals)
Cullen EPLs application
(Base and precious metals)
Cullen EPLs applications
(Coal)
19
20
Exploration Review
Exploration Review
PEACE RIVER COALFIELD, BRITISH COLUMBIA –
TSUMEB AND KALAHARI COPPER BELT –
Namibia
Namibia
COAL
In early 2012, Cullen initiated a review of the Peace River Coalfield of north-east British Columbia. This is a prime
metallurgical coalfield with a number of producing mines and major mining companies involved in exploration and
acquisition of assets (see Figure). As a result, Cullen, through its wholly-owned Canadian subsidiary, has applied for
~100 km of tenements over an under explored trend of Gething Formation west of Pink Mountain (see Figure). The
2
area adjoins a large Anglo application (January 2012) to the south and east. Anglo mines coal in the Peace River
Coalfield at Trend near Tumbler Ridge. This is an exciting exploration initiative where Cullen can apply first pass
mapping and geochemical techniques in a fairly accessible environment in the summer months (May – October),
once the applications are approved.
Trutch
To Fort Nelson
Cullen Applications
Pink Mountain
Anglo
American plc
C A N A D A
N
25 kilometres
/
Coal mine / prospect
Road, Rail
Town
Jameson
(ASX: JAL )
Fort St. John
Hudson's
Hope
Dawson Creek
Peace River Coalfield
(Met-coal / Thermal)
Chetwynd
WILLOW CREEK
COPPER, REE, AND BASE METALS
KAROO BASIN – COAL
Cullen Resources Namibia (Pty) Ltd has an exploration presence in Namibia,
south-west Africa. Cullen Namibia has to date: lodged applications for ~ 8,000 km
2
of prospective ground in Namibia; targeting large, sediment-hosted, African copper
belt-type deposits; Tsumeb-type base metal deposits and Rare Earth Elements
(REEs) in carbonatites. Five EPL applications, two near Tsumeb and three east of
Windhoek, prospective for copper, have now been granted. Cullen has purchased
aeromagnetics data and has completed stratigraphic and structural interpretation.
A field review has been completed and rapid assessment by geochemistry and/or
stratigraphic drilling can commence.
Cullen Resources Namibia (Pty) Limited, has also applied for five Exclusive
Prospecting Licences for coal in the Aranos Basin of southern Namibia. This basin
hosts the Aranos Coal deposit, but little regional exploration appears to have been
undertaken on the western margin of the basin. Cullen has generated these
projects on the basis of the known coal prospectivity of the Karoo Basin. The
applications are expected to be processed in the second half of 2012.
72 Mt @ 4.3% Cu
Produced
3475sq km
N A M I B I A
Tsumeb
Witvlei
13 Mt @ 1.85% Cu
Oamites
6.5 Mt @ 1.3% Cu
12g/t Ag Produced
Walvis Bay
Windhoek
4700sq km
Gobabis
Dordabis
2 Mt @ 0.98% Cu
Aranos
Coal
Deposit
Klein Aub
5.5 Mt @ 2% Cu
50g/t Ag Produced
Boseto
111 Mt @ 1.4% Cu,
17.6 g/t Ag
N
200 kilometres
Maun
Boseto
Copper Project
(Discovery
Minerals Limited)
Francistown
B O T S W A N A
Gaborone
Johannesburg
S O U T H A F R I C A
Cullen EPLs granted
(Base and precious metals)
Cullen EPLs application
(Base and precious metals)
Cullen EPLs applications
(Coal)
21
Exploration Review
Exploration Review
SCHEDULE OF TENEMENTS (as at 30 June 2012)
REGION
TENEMENTS
ASSOCIATED
TENEMENTS /
APPLICATIONS
CULLEN
INTEREST
COMMENTS
WESTERN AUSTRALIA
ASHBURTON / PILBARA
Mt Stuart JV
Hardey Junction JV
Wyloo JV
Paraburdoo JV
EL08/1135, 1330, 1341,
EL08/1292
EL08/1166, 1189, 1763, 1843,
P08/546
EL08/1393, EL47/1154, 1649, 1650,
P08/556
EL52/1667
Tunnel Creek JV
EL52/1890, 1892
30%
20%
50%
100%
100%
EL08/2227, 2145
EL53/1299, 1300 +/ *
EL53/1630, 1635
100%
Hardey North
NE GOLDFIELDS
Gunbarrel
Irwin Well
Irwin Bore JV
Wonganoo
EL53/1209, P53/1264, 1265
EL53/1611
Lake Mackay
Hill Springs
EASTERN GOLDFIELDS
Killaloe
FORRESTANIA
Forrestania JV
EL09/1766, 1885
EL63/1018, 1199, P63/1672, 1332-1333
EL77/1406, 1327, 1354, M77/0544
P77/3607, 3613, 3762, 3763
P77/3582 - 3588
EL04/1836, 1930, 1932,1945, 1946
EL20/714, 755
KIMBERLEY
Advaita JV
CARNARVON BASIN
North Tuckabianna
NEW SOUTH WALES
Minter
NORTHERN TERRITORY
Yambla
Amadeus
QUEENSLAND
Hughenden
EL6572
E26142
EPCs 2226, 2236
NAMIBIA
Tsumeb
Kalahari
Aranos Basin
SWEDEN
Kiruna area
FINLAND
EPLs 4493, 4495
EPLs 4494, 4496, 4500
Holmajarvi 2 and Lavasjakka
Kuusamo South & West, Rompas South,
West and Central, Suurikuusikko
Northeast and South, Kanasenvaara,
Joutseno 13, Misi, Kolari, Viistola,
Polvela, Tunturi, Aitoo
EL53/1637
EL80/4209
EL20/808
E25493, 25494
EPCs 2222, 2227, 2244,
2247, 2628, 2629, 2630,
2632
EPMs 18904 - 18906, 18913
EPLs 4501, 4497
EPLs 4498, 4599
EPLs 4599 - 4603
90%
100%
100%
100%
20%
100%
100%
100%
100%
100%
100%
100%
100%
API has earned 70% of iron ore rights
50 cents per tonne royalty
Northern Star 80%
2% NSR royalty
FMG can earn up to 80% of iron ore
rights
FMG can earn up to 80% of iron ore
rights
Thundelarra Exploration and U3O8
can earn up to 70%
Application only. No current interest
+2.5% NPI Royalty to Pegasus on
Cullen's Rights
*1.5% NSR Royalty to Aurora
Application only. No current interest
Western Australian Resources - 10%
Application only. No current interest
Matsa can earn 70%
Hannans Reward Ltd - 80%
2.5% NSR royalty
Advaita can earn 75% in coal rights
Applications only. No current interest
Applications only. No current interest
Applications only. No current interest
Claim reservations (2 years) or
EL applications
CANADA
Mabel Lake
Pink Mountain
TL 1-15
418132, 418133
Cullen earning 80%
Applications only. No current interest
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21
Exploration Review
Exploration Review
SCHEDULE OF TENEMENTS (as at 30 June 2012)
REGION
TENEMENTS
ASSOCIATED
TENEMENTS /
APPLICATIONS
CULLEN
INTEREST
COMMENTS
WESTERN AUSTRALIA
ASHBURTON / PILBARA
Mt Stuart JV
Hardey Junction JV
Wyloo JV
Paraburdoo JV
EL08/1135, 1330, 1341,
EL08/1292
EL08/1166, 1189, 1763, 1843,
P08/546
EL08/1393, EL47/1154, 1649, 1650,
P08/556
EL52/1667
Tunnel Creek JV
EL52/1890, 1892
30%
20%
50%
100%
100%
EL08/2227, 2145
EL53/1299, 1300 +/ *
EL53/1630, 1635
100%
Hardey North
NE GOLDFIELDS
Gunbarrel
Irwin Well
Irwin Bore JV
Wonganoo
EL53/1209, P53/1264, 1265
EL53/1611
Lake Mackay
Hill Springs
EASTERN GOLDFIELDS
Killaloe
FORRESTANIA
Forrestania JV
EL09/1766, 1885
EL63/1018, 1199, P63/1672, 1332-1333
EL77/1406, 1327, 1354, M77/0544
P77/3607, 3613, 3762, 3763
P77/3582 - 3588
EL04/1836, 1930, 1932,1945, 1946
EL20/714, 755
KIMBERLEY
Advaita JV
CARNARVON BASIN
North Tuckabianna
NEW SOUTH WALES
Minter
NORTHERN TERRITORY
Yambla
Amadeus
QUEENSLAND
Hughenden
EL6572
E26142
EPCs 2226, 2236
NAMIBIA
Tsumeb
Kalahari
Aranos Basin
SWEDEN
Kiruna area
FINLAND
EPLs 4493, 4495
EPLs 4494, 4496, 4500
Holmajarvi 2 and Lavasjakka
Kuusamo South & West, Rompas South,
West and Central, Suurikuusikko
Northeast and South, Kanasenvaara,
Joutseno 13, Misi, Kolari, Viistola,
Polvela, Tunturi, Aitoo
EL53/1637
EL80/4209
EL20/808
E25493, 25494
EPCs 2222, 2227, 2244,
2247, 2628, 2629, 2630,
2632
EPMs 18904 - 18906, 18913
EPLs 4501, 4497
EPLs 4498, 4599
EPLs 4599 - 4603
90%
100%
100%
100%
20%
100%
100%
100%
100%
100%
100%
100%
100%
API has earned 70% of iron ore rights
50 cents per tonne royalty
Northern Star 80%
2% NSR royalty
FMG can earn up to 80% of iron ore
rights
FMG can earn up to 80% of iron ore
rights
Thundelarra Exploration and U3O8
can earn up to 70%
Application only. No current interest
+2.5% NPI Royalty to Pegasus on
Cullen's Rights
*1.5% NSR Royalty to Aurora
Application only. No current interest
Western Australian Resources - 10%
Application only. No current interest
Matsa can earn 70%
Hannans Reward Ltd - 80%
2.5% NSR royalty
Advaita can earn 75% in coal rights
Applications only. No current interest
Applications only. No current interest
Applications only. No current interest
Claim reservations (2 years) or
EL applications
CANADA
Mabel Lake
Pink Mountain
TL 1-15
418132, 418133
Cullen earning 80%
Applications only. No current interest
.
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M
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
DIRECTORS' REPORT
Your Directors submit their report for the year ended 30 June 2012.
Directors
The names and details of the company’s directors in office during the financial year and until the date of this
report are as follows. Directors were in office for this entire period unless otherwise stated.
Dr Denis Clarke BSc, BA, PhD, FAIMM (Non‐Executive Chairman) (Appointed 1 April 1999)
•
Dr Denis Clarke has more than 40 years’ experience in exploration and mining operations. Over 15 years with
Plutonic Resources (“Plutonic”), he contributed significantly at the General Manager level to its success as it
developed from a small explorer in 1983 to one of Australia’s largest gold miners prior to its take‐over in 1998 in
a transaction which valued Plutonic at $1 billion. Dr Clarke at various times managed the exploration, finance,
administration and corporate divisions. He subsequently was a director and consultant to Troy Resources
Limited for eleven years as it developed from explorer to a successful international gold miner. During the past
three years Dr Clarke has been Chairman or Non‐Executive Director of the following listed companies:
‐ Hill End Gold Limited (from 25 February 2010 to present)
‐
‐
‐
‐
‐
Signature Metals Limited (from 14 September 2012 to present)
Anglo Australian Resources NL (from 9 April 2004 to 28 November 2011)
BCD Resources NL (from 25 November 2004 to 25 February 2011)
BCD Resources (Operations) NL (from 27 February 2007 to 25 February 2011)
Troy Resources Limited (from 24 March 1999 to 27 November 2010)
•
Dr Chris Ringrose BSc, PhD, MBA, MAIMM, MAICD (Managing Director) (Appointed 19 June 2003)
Dr Chris Ringrose has been an exploration geologist based mainly in Western Australia since he completed his
geology degrees in Scotland in 1982. His career has included experience with EZ, Chevron and Aztec, and prior to
joining Cullen, he was Exploration Manager with Troy Resources NL for nine years. Dr Ringrose has also
completed an MBA at Deakin University and brings to the Company significant management, exploration and
project evaluation experience gained both in Australia and overseas. Dr Ringrose has had no other directorships
of listed companies in the last three years.
Grahame Hamilton BSc, MSc, MAIG (Non‐Executive Director) (Appointed 1 April 1999)
•
Mr Grahame Hamilton, a graduate of the University of NSW, has extensive experience over 35 years in
exploration, corporate and project management. He has wide ranging expertise in project evaluation. Between
1994 and 1996 he managed the Brocks Creek exploration, environmental impact statement, feasibility study,
mine development and construction for Solomon Pacific Resources NL. Before Solomon, Mr Hamilton worked
with Getty Oil Development Co. ‐ Minerals Division as Queensland Manager. Mr Hamilton had been a director of
AIM‐listed public company Mariana Resources Limited until his resignation on 28 November 2008.
John Horsburgh BSc, MSc, FAIMM (Non‐Executive Director) (Appointed 1 April 1999)
•
Mr John Horsburgh, a graduate of the Royal School of Mines, has over 40 years’ industry experience including 11
years with Solomon Pacific Resources NL. Prior to this he gained extensive experience in Australia and overseas
with Getty Oil Development Co., Billiton and RTZ Group. Mr Horsburgh is Executive Chairman of TSX and AIM‐
listed public company Mariana Resources Limited.
‐ 23 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
•
Wayne John Kernaghan BBus, ACA, FAICD, ACIS (Non‐Executive Director and Company Secretary)
(Appointed 11 November 1997)
Mr Wayne Kernaghan is a member of the Institute of Chartered Accountants in Australia with a number of years
experience in various areas of the mining industry. He is also a Fellow of the Australian Institute of Company
Directors. During the past three years Mr Kernaghan has held and is currently a director and holds the following
listed company directorships:
•
•
•
Gulf Industrials Limited
South American Ferro Metals Limited (from 26 June 2012)
Farmworks Australia Limited (from 19 February 2010 to 24 August 2011)
Principal Activities
The principal activity for the Consolidated Entity comprising Cullen Resources Limited ("the Company") and its
controlled entities (together "the Consolidated Entity") during the course of the financial year was mineral
exploration. There was no significant change in the nature of the Consolidated Entity's activities during the year.
Results
The loss attributable to the Consolidated Entity for the financial year was $2,649,846 [2011: loss $1,640,087]. No
income tax was attributable to this result [2011: Nil].
Dividends
The directors do not recommend the payment of a dividend for this financial year. No dividend has been
declared or paid by the Company since the end of the previous financial year.
Significant Changes in the State of Affairs
In the opinion of the directors there were no significant changes in the state of affairs of the Consolidated Entity
that occurred during the financial year under review not otherwise disclosed in this report or the consolidated
financial statements.
Review of Operations
Cullen is a mineral exploration company seeking deposits of gold, nickel, coal, copper, uranium and iron ore
either in its own right, or managed by other partners in Joint Ventures.
During the year under review, the Company continued its mineral exploration activities including: project
generation, database reviews, field mapping and geochemical surveying, and drilling programmes. Company
exploration activities, including Joint Venture managed projects, were focused in Western Australia with
additional activities in New South Wales and Queensland as follows:
Ashburton Province, WA (Hardey Junction JV, Mt Stuart JV, Wyloo JV, Paraburdoo JV and Tunnel Creek
/Saltwater Pool JV ‐ gold, uranium and /or iron ore projects)
North Eastern Goldfields, WA (Gunbarrel and Irwin Bore, gold and nickel projects)
Eastern Goldfields, WA (Killaloe gold and nickel project)
Forrestania, WA (Forrestania JV, gold and nickel project)
Central Lachlan Fold Belt, NSW (Minter tungsten project)
Eromanga, Millungera and Galilee Basins, NW Queensland (coal and copper‐gold projects)
Drilling by Cullen or its Joint Venture partners during the year to 30 June 2012 included programmes for: iron ore
at Wyloo; for copper and gold at the North Tuckabianna project; for tungsten at Minter and for nickel deposits in
the Forrestania area. Other exploration field work has included: field reconnaissance, geological mapping,
geochemical surveys, and evaluations of new project opportunities. The Company continued to market projects
as potential farm‐out opportunities.
‐ 24 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Also during the year the Company continued exploration activities in Namibia, in south‐west Africa with
aeromagnetic data interpretation for copper in two prospective terranes. The company also has tenements for
coal exploration in Namibia, and has an exploration presence in Scandinavia with applications in Sweden and
Finland. The company has applied for a number of tenements with graphite prospectivity in Finland.
Also overseas, Cullen progressed work at the “TL Property” project in south‐east British Columbia in a search for
base metals. The first pass trenching programme Cullen conducted discovered high‐grade zinc mineralisation at
surface for further evaluation, and a heliTEM survey was flown during the year and preliminary drill targets
finalised.
A total of $2,619,422 (2011: $1,935,531) was spent on exploration by Cullen during the year, with Joint Venture
Partners contributing further exploration funds on Cullen tenements.
Cullen will continue to identify and evaluate both advanced and "grass roots" projects throughout Australia and
in selected overseas locations. Cullen’s portfolio is under continual evaluation to focus on projects likely to result
in discovery of an economic mineral deposit.
Corporate
At 30 June 2012 available cash totalled $2,459,240 (2011: $2,632,257).
After Balance Date Events
There has not arisen in the interval between the end of the financial year and the date of this report any item,
transaction or event of a material and unusual nature likely, in the opinion of the directors, to affect the
operations of the Consolidated Entity, the results of those operations or the state of affairs of the Consolidated
Entity in the subsequent financial years other than:
Likely Developments and Future Results
Other than as referred to in this report, further information as to likely developments in the operations of the
Consolidated Entity and the expected results of those operations would, in the opinion of the directors, be
speculative and not in the best interests of the Consolidated Entity.
Environmental Regulation
The exploration activities of the Consolidated Entity in Australia are subject to environmental regulation under
the laws of the Commonwealth and the States in which those exploration activities are conducted. The
environmental laws and regulations generally address the potential impact of the Consolidated Entity's activities
in the areas of water and air quality, noise, surface disturbance and the impact upon flora and fauna. The
directors are not aware of any environmental matter which would have a materially adverse impact on the
overall business of the Consolidated Entity.
Options
As at the date of this report the Company has 22,000,000 (2011: 22,000,000) options which were outstanding.
Refer to Note 11 of the financial statements for further details of the options outstanding.
During the year no fully paid ordinary shares were issued by virtue of the exercise of options (2011: Nil). Since
the end of the financial year no shares have been issued by virtue of the exercise of options (2011: Nil).
‐ 25 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Directors’ Interest
At the date of this report, the interest of the directors in the shares and options of the company were:
2012
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Direct
Fully Paid Shares
‐
200,000
‐
2
2,000,000
Options
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
Indirect
Fully Paid Shares
4,614,000
‐
15,141,004
16,702,122
1,623,376
Options
‐
‐
‐
‐
‐
Directors' Meetings
During the year the Company held sixteen meetings of directors. The attendance of the directors at meetings of
the Board were:
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Board of Directors
Attended
16
16
16
16
16
Maximum possible
eligible to attend
16
16
16
16
16
Indemnification and insurance of Directors and Officers
The Company has entered into deeds of indemnity with the Directors indemnifying them against certain
liabilities and costs to the extent permitted by law. The Company has paid premiums totalling $19,995 (2011:
$19,925) in respect of Directors and Officers Liability Insurance and Company reimbursement policies, which
covers all Directors and Officers of the Company. The policy conditions preclude the Company from any detailed
disclosures.
Employees
The Consolidated Entity employed three employees as at 30 June 2012 (2011: 4).
Corporate Governance
In recognising the need for the highest standard of corporate behaviour and accountability, the directors of
Cullen Resources Limited support and have adhered to the principles of good corporate governance. The
Company’s corporate governance statement is on page 32.
Auditor Independence
The directors have received the auditor’s independence declaration for the year ended 30 June 2012 which is on
page 30 and forms part of this directors’ report. For the year the auditors have provided taxation services to
the Consolidated Entity.
‐ 26 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
REMUNERATION REPORT (AUDITED)
This report details the nature and amount of remuneration for each director of Cullen Resources Limited.
This remuneration report outlines the director and executive remuneration arrangements of the Consolidated
Entity in accordance with the requirements of the Corporations Act 2001 and its Regulations. For the purposes of
this report, key management personnel (KMP) of the Consolidated Entity are defined as those persons having
authority and responsibility for planning, directing and controlling the major activities of the Consolidated Entity,
directly or indirectly, including any director (whether executive or otherwise) of the parent company. Only
directors of the Consolidated Entity meet the definition of key management personnel as the executive role is
performed by the executive director.
Details of key management personnel:
Directors
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Chairman (Non‐Executive)
Managing Director
Director (Non‐Executive)
Director (Non‐Executive)
Director (Non‐Executive)
Remuneration Policy
The remuneration policy of Cullen Resources Limited has been designed to align director objectives with
shareholder and business objectives by providing a fixed remuneration component and offering specific long‐
term incentives. The board of Cullen Resources Limited believes the remuneration policy to be appropriate and
effective in its ability to attract and retain the best executives and directors to run and manage the Company as
well as create goal congruence between directors and shareholders.
The Board’s policy for determining the nature and amount of remuneration for Board members is as follows.
The remuneration policy, setting the terms and conditions for the executive director was developed by the
Board. The executive receives a base salary on factors such as length of service and experience, superannuation,
options and incentives. The Board reviews executive packages annually by reference to executive performance
and comparable information from industry sectors and other listed companies in similar industries.
The Board policy is to remunerate non‐executive directors at market rates for comparable companies for time,
commitment and responsibilities. The Board determines payments to the non‐executive directors and reviews
their remuneration annually, based on market practice, duties and accountability. Independent external advice is
sought when required. The maximum aggregate amount of fees that can be paid to non‐executive directors is
subject to approval by shareholders at the Annual General Meeting. Fees for non‐executive directors are not
linked to either long term or short term performance of the Consolidated Entity. However, to align directors’
interest with shareholder interests, the directors are encouraged to hold shares in the Company. There is a
specified aggregate directors fees of $250,000 for non‐executive directors which was approved by shareholders
at a general meeting of the Company. The $250,000 excludes other services outside of non‐executive directors'
fees.
Remuneration Incentives
Director and executive remuneration is currently not linked to either long term or short term performance
conditions. The Board feels that the expiry date and exercise price of the options currently on issue to the
directors and executives is sufficient to align the goals of the directors and executives with those of the
shareholders to maximise shareholder wealth, and as such, has not set any performance conditions for the
directors or the executives of the Company. The Board will continue to monitor this policy to ensure that it is
appropriate for the Company in future years.
‐ 27 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Group performance and shareholder wealth
Below is a table summarising key performance and shareholder wealth statistics for the Consolidated Entity over
the last five years.
Financial Year
30 June 2008
30 June 2009
30 June 2010
30 June 2011
30 June 2012
Loss After Tax
$
2,314,751
6,307,393
2,161,235
1,640,087
2,649,846
EPS
Cents
(0.44)
(1.14)
(0.39)
(0.27)
(0.41)
Share Price
Cents
2.9
2.6
3.4
3.0
1.8
Employment Contracts
Managing Director
Pursuant to an agreement Dr Ringrose will provide managing director services to the Company. The term of this
arrangement is from 1 November 2006 and will continue thereafter unless terminated on not less than three
months' notice given at any time. Effective from 1 April 2011 Dr Ringrose’s salary is $265,000pa. The position of
the director will become redundant under this agreement in the limited circumstances where the employment
of the Managing Director is terminated as a result of a takeover or merger of the Company. The Company will
pay the Managing Director the equivalent of four weeks per year of service or part thereof of his base salary as a
redundancy payment.
As part of Dr Ringrose's employment package he was issued with 8,000,000 options with the following terms.
The options will expire on the earlier of the date which is one month after the Director to whom the options are
issued ceases to be a Director of the Company (or such longer period as determined by the Board of Directors) or
at 5.00 pm on 30 November 2013 ("the Expiry Date") with an exercise price of $0.075. This is contained in the
notice of meeting which was approved by shareholders.
During the year the Board paid a discretionary bonus of $10,000 to Dr Ringrose. This bonus was discretionary
therefore there were no performance conditions attached to this bonus.
Non Executive Directors
The non executive directors have been issued with two million options each with an exercise price of $0.075
each. The options will expire on the earlier of the date which is one month after the Director to whom the
options are issued ceases to be a Director of the Company (or such longer period as determined by the Board of
Directors) or at 5.00 pm on 30 November 2013 ("the Expiry Date"). This is contained in the notice of meeting
which was approved by shareholders.
Directors’ and Executives’ Remuneration
Details of remuneration provided to directors who include the most highly remunerated executives for the year
ended 30 June 2012 are as follows:
Directors
Short Term
Director
Fees
$
35,000
‐
30,000
30,000
30,000
125,000
Salary/
Consult‐
ing
$
‐
265,000
80,775
‐
41,000
386,775
Bonus
$
‐
10,000
‐
‐
‐
10,000
Non
Monetary
Benefits
$
‐
* 6,836
‐
‐
‐
6,836
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Total
* This relates to the provision of a motor vehicle.
Post
Employ‐
ment
Super‐
annuation
$
3,150
24,750
2,700
2,700
2,700
36,000
Long
Term
Long
Service
Leave
$
‐
8,208
‐
‐
‐
8,208
Share
Based
Payments
Options
$
‐
‐
‐
‐
‐
‐
Perfor‐
mance
Related
%
‐
‐
‐
‐
‐
‐
Total
$
38,150
314,794
113,475
32,700
73,700
572,819
‐ 28 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
The Company has no policy on directors and executives entering into contracts to hedge their exposure to
options or shares granted as part of their remuneration package.
Details of remuneration provided to directors who include the most highly remunerated executives for the year
ended 30 June 2011 are as follows:
Directors
Short Term
Director
Fees
$
35,000
Salary/
Consult‐
ing
$
Non
Monetary
Benefits
$
‐
‐
Post
Employ‐
ment
Super‐
annuation
$
3,150
Long
Term
Long
Service
Leave
$
‐
Share
Based
Payments
Options
$
55,400
Total
$
93,550
‐
255,260
* 7,172
22,973
24,139
221,600
531,144
30,000
30,000
30,000
82,125
‐
33,360
‐
‐
‐
2,700
2,700
2,700
‐
‐
‐
55,400
170,225
55,400
88,100
55,400
121,460
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Total
125,000
370,745
7,172
34,223
24,139
443,200
1,004,479
* This relates to the provision of a motor vehicle.
Perfor‐
mance
Related
%
‐
‐
‐
‐
‐
‐
Options granted as part of remuneration for the year ended 30 June 2012
There were nil (2011: 16,000,000) options granted as part of director and executive emoluments during the year.
Shares issued on exercise of remunerated options
During the financial year nil (2011: Nil) remunerated options were exercised. During the financial year nil
(2011: 8,000,000) options expired. The directors exercised nil (2011: Nil) options during the year.
Directors
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Value of options
granted during the
year
$
‐
‐
‐
‐
‐
Value of options
exercised during the
year
$
‐
‐
‐
‐
‐
Value of options
expired during the year
$
‐
‐
‐
‐
‐
Total value of options
granted, exercised and
expired during the year
$
‐
‐
‐
‐
‐
There were no options granted as a part of remuneration for the year ended 30 June 2012.
Options granted as part of remuneration for the year ended 30 June 2011
Directors
D. Clarke
C. Ringrose
G. Hamilton
J. Horsburgh
W. Kernaghan
Value of options
granted during the
year
$
55,400
221,600
55,400
55,400
55,400
Value of options
exercised during the
year
$
‐
‐
‐
‐
‐
Value of options
expired during the year
$
(99,540)
‐
(99,540)
(99,540)
(99,540)
Total value of options
granted, exercised and
expired during the year
$
(44,140)
221,600
(44,140)
(44,140)
(44,140)
The options issued are not subject to any performance conditions.
End of Remuneration Report
‐ 29 ‐
Auditor’s Independence Declaration to the Directors of Cullen Resources
Limited
In relation to our audit of the financial report of Cullen Resources Limited for the year ended 30 June
2012, to the best of my knowledge and belief, there have been no contraventions of the auditor
independence requirements of the Corporations Act 2001 or any applicable code of professional conduct.
Ernst & Young
P McIver
Partner
Perth
27 September 2012
PM:MM:CULLEN:006
Liability limited by a scheme approved
under Professional Standards Legislation
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Signed in accordance with a resolution of the directors
C. Ringrose
Director
Perth, WA
27 September 2012
‐ 31 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
CORPORATE GOVERNANCE STATEMENT
In recognising the need for the highest standards of corporate behaviour and accountability, the directors of
Cullen Resources Limited have adhered to the principles of corporate governance and this statement outlines
the main corporate governance practices in place throughout the financial year. The ASX Corporate Governance
Council released revised Corporate Governance Principles and Recommendations on 2 August 2007. Having
regard to the size of the Company and the nature of its enterprise, it is considered that the Company complies
as far as possible with the spirit and intentions of the ASX Corporate Governance Council's Corporate
Governance Principles and Recommendations. Unless otherwise stated, the practices were in place for the
entire year.
Board of Directors
The Board of Directors of the Company is responsible for the corporate governance of the Company. The Board
guides and monitors the business and affairs of the Company on behalf of the shareholders by whom they are
elected and to whom they are accountable.
As the Board acts on behalf of shareholders, it seeks to identify the expectations of shareholders, as well as
other ethical expectations and obligations. In addition, the Board is responsible for identifying areas of
significant business risk and ensuing arrangements are in place to adequately manage those risks.
The primary responsibility of the Board includes:
formulation and approval of the strategic direction, objectives and goals of the Company;
monitoring the financial performance of the Company, including approval of the Company’s financial
statements;
ensuring that adequate internal control systems and procedures exists and that compliance with these
systems and procedures is maintained;
the identification of significant business risks and ensuring that such risks are adequately managed;
the review of performance and remuneration of executive directors; and
the establishment and maintenance of appropriate ethical standards.
The responsibility for the operation and administration of the Company is carried out by the directors, who
operate in an executive capacity, supported by senior professional staff. The Board ensures that this team is
suitably qualified and experienced to discharge their responsibilities, and assesses on an ongoing basis the
performance of the management team, to ensure that management’s objectives and activities are aligned with
the expectations and risks identified by the Board.
The Directors of the Company are as follows:
Dr Denis Clarke
Dr Chris Ringrose
Grahame Hamilton
John Horsburgh
Wayne Kernaghan
For information in respect to each director refer to the Directors' Report.
‐ 32 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Independent Directors
Under ASX guidelines, principle 2.1, two of the current Board of five directors are considered to be independent
directors. Dr Ringrose is the executive director and Mr Horsburgh and Mr Hamilton, who are former executive
directors, are, under the ASX guidelines deemed not to be independent by virtue of their positions or former
positions. The Board is satisfied that the structure of the Board is appropriate for the size of the Company and
the nature of its operations and is a cost effective structure for managing the Company.
Board Composition
When the need for a new director is identified, selection is based on the skills and experience of prospective
directors, having regard to the present and future needs of the Company. Any director so appointed must then
stand for election at the next Annual General Meeting of the Company.
Terms of Appointment as a Director
The constitution of the Company provides that a Director, other than the Managing Director, may not retain
office for more than three calendar years or beyond the third annual general meeting following his or her
election, whichever is longer, without submitting for re‐election. One third of the Directors must retire each
year and are eligible for re‐election. The Directors who retire by rotation at each annual general meeting are
those with the longest length of time in office since their appointment or last election.
Board Committees
In view of the size of the Company and the nature of its activities, the Board has considered that establishing
formally constituted committees for audit, board nominations and remuneration would contribute little to its
effective management. Accordingly audit matters, the nomination of new Directors and the setting, or review,
of remuneration levels of Directors and senior executives are reviewed by the Board as a whole and approved
by resolution of the Board (with abstentions from relevant Directors where there is a conflict of interest).
Where the Board considers that particular expertise or information is required, which is not available from
within their number, appropriate external advice may be taken and reviewed prior to a final decision being
made by the Board.
Remuneration
Remuneration and other terms of employment of executives, including executive directors, are reviewed
periodically by the Board having regard to performance, relevant comparative information and, where
necessary, independent expert advice. Remuneration packages are set at levels that are intended to attract and
retain executives capable of managing the Company’s operations.
The terms of engagement and remuneration of executive directors is reviewed periodically by the Board, with
recommendations being made by the non‐executive directors. Where the remuneration of a particular
executive director is to be considered, the director concerned does not participate in the discussion or decision
making.
Make Timely and Balanced Disclosure
The board has in place written policies and procedures to ensure the Company complies with its obligations
under the continuous disclosure rule 3.1 and other ASX Listing Rule disclosure requirements.
Independent Professional Advice
Directors have the right, in connection with their duties and responsibilities as directors, to seek independent
professional advice at the Company’s expense. Prior approval of the Chairman is required, which will not be
unreasonably withheld.
‐ 33 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Code of Conduct
In view of the size of the Company and the nature of its activities, the Board has considered that an informal
code of conduct is appropriate to guide executives, management and employees in carrying out their duties and
responsibilities.
Diversity Policy
The Company is in the process of establishing a diversity policy.
As at 30 June 2012, 33.3% of the workforce is female with no females at board or senior management level.
Communication to Market & Shareholders
The Board of directors aims to ensure that the shareholders, on behalf of whom they act, are informed of all
information necessary to assess the performance of the directors and the Company. Information is
communicated to shareholders and the market through:
the Annual Report which is available to all shareholders;
other periodic reports which are lodged with ASX and available for shareholder scrutiny;
other announcements made in accordance with ASX Listing Rules;
special purpose information memoranda issued to shareholders as appropriate;
the Annual General Meeting and other meetings called to obtain approval for board action as appropriate;
and,
The Company's website.
Share Trading
Dealings are not permitted at any time whilst in the possession of price sensitive information not already
available to the market. In addition, the Corporations Act 2001 prohibits the purchase or sale of securities whilst
a person is in possession of inside information.
External Auditors
The external auditor is Ernst and Young. The external auditors are invited to attend the annual general meeting
and be available to answer shareholder questions about the conduct of the audit and the preparation and
content of the auditor's report.
Full details of the company’s corporate governance practices can be viewed at its website
www.cullenresources.com.au.
‐ 34 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Consolidated Statement of Financial Position
at 30 June 2012
Consolidated
2012
$
2,459,240
144,015
2,603,255
32,400
5,974
3,751,958
3,790,332
6,393,587
814,465
143,597
958,062
22,226
22,226
980,288
2011
$
2,632,257
69,156
2,701,413
540,450
11,608
3,142,502
3,694,560
6,395,973
194,816
135,956
330,772
17,056
17,056
347,828
5,413,299
6,048,145
36,605,266
1,280,125
‐
(32,472,092)
5,413,299
34,610,266
1,280,125
(20,000)
(29,822,246)
6,048,145
Current Assets
Cash and cash equivalents
Receivables
Total Current Assets
Non Current Assets
Other financial assets
Plant & Equipment
Exploration & Evaluation
Total Non Current Assets
Total Assets
Current Liabilities
Trade and other payables
Provisions
Total Current Liabilities
Non Current Liabilities
Provisions
Total Non Current Liabilities
Total Liabilities
Net Assets
Equity
Issued Capital
Share based payment reserve
Available for sale reserve
Accumulated Losses
Total Equity
Note
22(i)
5
6
7
8
9
10
10
11
12
13
14
‐ 35 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Consolidated Statement of Changes in Equity
at 30 June 2012
Note
Issued
Capital
$
Share Based
Payment
Reserve
$
Available for
Sale
Reserve
$
Accumulated
Losses
$
Total
Equity
$
At 1 July 2010
31,724,656
728,925
Loss for the year
Other comprehensive income
13
Release of unrealised loss
reserve due to impairment
Total comprehensive
income/(expense) for the year
Issue of share capital
Share issue costs
‐
‐
‐
‐
2,936,235
(50,625)
‐
‐
‐
‐
‐
‐
Share based payments
12
‐
551,200
‐
‐
(149,550)
129,550
(28,182,159)
4,271,422
(1,640,087)
(1,640,087)
‐
‐
(149,550)
129,550
(20,000)
(1,640,087)
(1,660,087)
‐
‐
‐
‐
‐
‐
2,936,235
(50,625)
551,200
At 30 June 2011
34,610,266
1,280,125
(20,000)
(29,822,246)
6,048,145
Note
Issued
Capital
$
Share Based
Payment
Reserve
$
Available for
Sale
Reserve
$
Accumulated
Losses
$
Total
Equity
$
At 1 July 2011
34,610,266
1,280,125
(20,000)
(29,822,246)
6,048,145
Loss for the year
Other comprehensive income
13
Release of unrealised loss
reserve due to impairment
Total comprehensive
income/(expense) for the year
Issue of share capital
Share issue costs
‐
‐
‐
‐
2,100,000
(105,000)
Share based payments
12
‐
‐
‐
‐
‐
‐
‐
‐
At 30 June 2012
36,605,266
1,280,125
‐
‐
20,000
(2,649,846)
(2,649,846)
‐
‐
‐
20,000
20,000
(2,649,846)
(2,629,846)
‐
‐
‐
‐
‐
‐
‐
2,100,000
(105,000)
‐
(32,472,092)
5,413,299
‐ 36 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Consolidated Statement of Comprehensive Income
for the year ended 30 June 2012
Note
3
8
12
3
4
Revenues
Rent
Salaries and Consultants' fees
Compliance expenses
Impairment of exploration expenditure
Exploration and evaluation expenses
Share based payments
Impairment of available for sale investments
Depreciation
Other expenses
Loss before income tax
Income tax benefit
Net Loss attributable to members of
Cullen Resources Limited after tax
Other Comprehensive Income
Consolidated
2012
$
2011
$
168,990
1,046,794
(38,336)
(416,959)
(188,479)
(2,009,986)
‐
‐
(6,845)
(5,634)
(152,597)
(38,958)
(419,032)
(164,537)
(1,239,187)
(170,138)
(551,200)
(129,550)
(8,315)
(196,005)
(2,649,846)
(1,870,128)
‐
230,041
(2,649,846)
(1,640,087)
Net change in fair value for sale assets 13
‐
(149,550)
Release of unrealised loss reserve due to impairment 13
20,000
129,550
Total comprehensive income/(expense)
for the period
(2,629,846)
(1,660,087)
Basic (loss) per share
(cents per share)
Diluted (loss) per share
(cents per share)
(0.41)
(0.27)
(0.41)
(0.27)
23
23
‐ 37 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Consolidated Statement of Cash Flows
for the year ended 30 June 2012
Note
Consolidated
2012
$
2011
$
Cash flows from operating activities
Research and development grant
Cash payments in the course of operations
GST refunded
Interest received
‐
(358,177)
124,895
71,982
230,041
(1,145,308)
104,961
161,467
Net operating cash flows
22(ii)
(161,300)
(648,839)
Cash flows from investing activities
Security deposits
Proceeds from sale of investment
Proceeds from sale of tenements
Payment for plant & equipment
Payments for exploration & evaluation
Net investing cash flows
Cash flows from financing activities
Proceeds from issue of shares
Share issue costs
Net financing cash flows
Net increase/(decrease) in cash
and cash equivalents
Cash and cash equivalents at the
beginning of the financial year
Cash and cash equivalents at the end
of the financial year
(22,400)
635,125
‐
‐
(2,619,442)
‐
‐
100,000
(5,821)
(1,765,393)
(2,006,717)
(1,671,214)
2,100,000
(105,000)
2,936,235
(50,625)
1,995,000
2,885,610
(173,017)
565,557
2,632,257
2,066,700
22(i)
2,459,240
2,632,257
‐ 38 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Notes to the Financial Statements
1.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation
(a)
The financial statements are general purpose financial statements, which have been prepared in accordance with the requirements
of the Corporations Act 2001, and Australian Accounting Standards. The financial statements have also been prepared in
accordance with the historical cost convention using the accounting policies described below and do not take account of changes in
either the general purchasing power of the dollar or in prices of specific assets.
Statement of compliance
(b)
The financial statements comply with Australian Accounting Standards and International Financial Reporting Standards (IFRS) as
issued by the International Accounting Standards Board.
Accounting policies and disclosures
(c)
The Group has adopted all new and amended Australian Accounting Standards and AASB interpretations which were applicable as of
1 July 2011. Adoption of these new and amended Australian Accounting Standards and ASSB interpretations did not have any effect
on the financial position or performance of the Group.
The Group has not elected to early adopt any new standards or amendments.
Going Concern
The accounts have been prepared on the going concern basis, which contemplates continuity of normal business activities and the
realisation of assets and liabilities in the normal course of business.
The consolidated group had cash assets of $2,459,240 at 30 June 2012. The directors acknowledge that continued exploration and
development of the consolidated group’s mineral exploration projects will necessitate further capital raisings.
The consolidated group remains dependent on its ability to raise funding in volatile capital markets. However, the directors
continue to believe that the going concern basis of accounting by the consolidated group is appropriate as the company and
consolidated group have successfully completed a capital raising during the year to 30 June 2012, notwithstanding the challenging
conditions in equity markets.
In consideration of the above matters, the directors have determined that it is reasonably foreseeable that the consolidated group will
continue as going concern and that it is appropriate that the going concern method of accounting be adopted in the preparation of the
financial statements. In the event that the consolidated group is unable to continue as a going concern (due to inability to raise future
funding requirements), it may be required to realise its assets at amounts different to those currently recognised, settle liabilities other
than in the ordinary course of business and make provisions for other costs which may arise as a result of cessation or curtailment of
normal business operations.
Accordingly, the financial statements do not include adjustments relating to the recoverability and classification of assets amount
or to the amounts and classification of liabilities that might be necessary if the consolidated group does not continue a going
concern.
Principles of consolidation
(d)
The consolidated financial statements include the financial statements of Cullen Resources Limited and the results of all of its
controlled entities which are referred to collectively throughout these financial statements as the “Consolidated Entity”. The results
of controlled entities are prepared for the same reporting period as the parent, using consistent accounting policies. All inter‐entity
balances and transactions, and unrealised profits arising from intra‐economic entity transactions, have been eliminated in full.
Taxes
(e)
Income tax
Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences:
except where the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a
transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor
taxable profit or loss; and
39
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
in respect of taxable temporary differences associated with investments in subsidiaries, associates and interest in joint venture,
except where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary
differences will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry‐forward of unused tax assets and unused
tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences,
and the carry‐forward of unused tax assets and unused tax losses can be utilised:
except where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition
of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither
the accounting profit nor taxable profit or loss; and
in respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint
ventures, deferred tax assets are only recognised to the extent that it is probable that the temporary differences will reverse
in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is
realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance
sheet date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in the statement of comprehensive
income.
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST except:
where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST
is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the
Statement of Financial Position. Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of
cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority are
classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.
Provision for employee benefits
(f)
Provision has been made in the financial statements for benefits accruing to employees in relation to annual leave and long service
leave. Annual leave provisions expected to be settled within twelve months are measured at their nominal amounts. Long service
leave provisions are measured at the present value of the estimated future cash outflow to be made in respect of services provided
by employees up to the reporting date using the projected unit credit method.
Investments in controlled entities
(g)
Investments in controlled entities are carried in the company’s financial statements at the lower of cost and recoverable amount.
Dividends and distributions are brought to account when they are proposed by the controlled entities.
Exploration and Evaluation Expenditure
Expenditure is deferred
(h)
(i)
Expenditure on exploration and evaluation is accounted for in accordance with the 'area of interest' method. Exploration and
evaluation expenditure is capitalised provided the rights to tenure of the area of interest is current and either:
the exploration and evaluation activities are expected to be recouped through successful development and exploitation of the
area of interest or, alternatively, by its sale; or
exploration and evaluation activities in the area of interest have not at the reporting date reached a stage that permits a
reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant
operations in, or relating to, the area of interest are continuing.
When the technical feasibility and commercial viability of extracting a mineral resource have been demonstrated then any
capitalised exploration and evaluation expenditure is reclassified as capitalised mine development. Prior to reclassification,
40
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
capitalised exploration and evaluation expenditure is assessed for impairment.
Impairment
The carrying value of capitalised exploration and evaluation expenditure is assessed for impairment at the cash generating unit
level whenever facts and circumstances suggest that the carrying amount of the asset may exceed its recoverable amount.
An impairment exists when the carrying amount of an asset or cash‐generating unit exceeds its estimated recoverable amount. The
asset or cash‐generating unit is then written down to its recoverable amount. Any impairment losses are recognised in the
Statement of Comprehensive Income.
(i)
Both the functional and presentation currency of Cullen Resources Limited and its Australian subsidiaries is Australian dollars ($A).
Foreign currency
Foreign currency transactions are translated to Australian currency at the rate of exchange ruling at the date of the transactions.
Monetary items in foreign currencies at balance date are translated at the rates of exchange ruling on that date.
Exchange differences relating to amounts payable and receivable in foreign currencies are brought to account in the Statement of
Comprehensive Income in the financial year in which the exchange rates change, as exchange gains or losses.
(j)
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses.
Plant and equipment
Depreciation is calculated on a straight‐line basis over the estimated useful life of the assets as follows:
Plant and equipment – over 3 to 8 years.
The assets residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate at each financial year
end.
Revenue
(k)
Other revenue includes interest revenue on short term deposit received from other persons. It is brought to account using the
effective interest rate method. This is a method of calculating the amortised cost of a financial asset and allocating the interest
income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to the net carrying amount of the financial asset.
Joint ventures
(l)
The Consolidated Entity’s interests in jointly controlled assets are accounted for by recognising its proportionate share in assets
and liabilities from joint ventures.
Joint venture expenses are recognised on a proportionate basis according to Cullen’s joint venture interest. The Consolidated
Entity does not currently receive any income from its joint venture assets.
The Consolidated Entity does not hold any interests in jointly controlled entities.
Payables
(m)
Liabilities for trade creditors and other amounts are carried at cost which is the fair value of the consideration to be paid in the
future for goods and services received, whether or not billed to the Consolidated Entity.
Cash and cash equivalents
(n)
Cash and cash equivalents in the balance sheet comprise cash at bank and in hand and short‐term deposits with an original
maturity of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant
risk of changes in value. For the purposes of the Statement of Cash Flows, cash includes cash on hand and in banks, and money
market investments readily convertible to cash within 2 working days.
Leases
(o)
The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement and requires an
assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset or assets and the
arrangement conveys a right to use the asset.
Operating lease payments are recognised as an expense in the Statement of Comprehensive Income on a straight‐line basis over
the lease term.
Issued capital
(p)
Issued and paid up capital is recognised at the fair value of the consideration received by the Consolidated Entity. Any transaction
costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the share proceeds received.
41
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Earnings per share (EPS)
(q)
Basic EPS is calculated as net profit/(loss) attributable to members, adjusted to exclude costs of servicing equity, divided by the
weighted average number of ordinary shares, adjusted for any bonus element. Diluted EPS is calculated as net profit/ (loss)
attributable to members, adjusted for:
costs of servicing equity;
the after tax effect of interest associated with dilutive potential ordinary shares that have been recognised as expenses;
and
other non‐discretionary changes in revenues or expenses during the period that would result from the dilution of potential
ordinary shares;
divided by the weighted average number of ordinary shares, adjusted for any bonus element.
(r)
The accounting policies adopted are consistent with those of the previous year, except as noted at Note 1(c).
Change in accounting policies
Share based payments
(s)
At each subsequent reporting date until vesting, the cumulative charge to the Statement of Comprehensive Income is the product
of:
(i)
(ii)
(iii)
The grant date fair value of the option.
The current best estimate of the number of options that will vest, taking into account such factors as the likelihood of
employee turnover during the vesting period and the likelihood of non‐market performance conditions being met.
The expired portion of the vesting period.
The charge to the income statement for the period is the cumulative amount as calculated above less the amounts already charged
in previous periods. There is a corresponding entry to equity.
The company may also issue options that do not have any vesting conditions.
Until an option has vested, any amounts recorded are contingent and will be adjusted if more or fewer options vest than were
originally anticipated to do so. Any option subject to a market condition is considered to vest irrespective of whether or not that
market condition is fulfilled, provided that all other conditions are satisfied.
If the terms of an equity‐settled option are modified, as a minimum an expense is recognised as if the terms had not been
modified. An additional expense is recognised for any modification that increases the total fair value of the share‐based payment
arrangement, or is otherwise beneficial to the employee, as measured at the date of modification.
If an equity‐settled option is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet
recognised for the option is recognised immediately. However, if a new option is substituted for the cancelled option and
designated as a replacement option on the date that it is granted, the cancelled and new option are treated as if they were a
modification of the original option, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of diluted earnings per
share.
Investment and other financial assets
(t)
Financial assets in the scope of AASB 139 Financial Instruments: Recognition and Measurement are classified as either financial assets
at fair value through profit or loss, loans and receivables, held‐to‐maturity investments, or available‐for‐sale investments, as
appropriate. When financial assets are recognised initially, they are measured at fair value, plus, in the case of investments not at fair
value through profit or loss, directly attributable transactions costs. The Consolidated Entity determines the classification of its
financial assets after initial recognition and, when allowed and appropriate, re‐evaluates this designation at each financial year‐end.
Subsequent measurement of available‐for‐sale financial assets
Available‐for‐sale financial assets are non‐derivative financial assets that are designated as available‐for‐sale. After initial
measurement, available –for‐sale financial assets are measured at fair value with unrealised gains or losses recognised as other
comprehensive income in the available‐for‐sale reserve until the investment is derecognised, at which time the cumulative gain or
loss recorded is recognised in the income statement, or determined to be impaired, at which time the cumulative loss recorded is
recognised in the income statement.
42
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Impairment of non‐financial assets
(u)
Non‐financial assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may
not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable
amount. Recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows that are largely
independent of the cash inflows from other assets or groups of assets (cash‐generating units). Non‐financial assets other than
goodwill that suffered an impairment are tested for possible reversal of the impairment whenever events or changes in
circumstances indicate that the impairment may have reversed.
New accounting standards and interpretations
(v)
The financial report complies with Australian Accounting Standards and International Financial Reporting Standards (“IFRS”) as
issued by the International Accounting Standards Board (“IASB”).
i.
Accounting Standards and Interpretations issued but not yet effective.
International Accounting Standards and Interpretations that have recently been issued or amended but are not yet effective have
not been adopted by the Group for the annual reporting period ended 30 June 2012. The group is still in the process of reviewing
their impact, if any. These are outlined in the table below.
43
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Reference
Title
Summary
Application
date of
standard*
Application
date for
Group*
1 Jan 2012
1 July 2012
2010‐8
AASB 2011‐
3**
AASB 2011‐9
Amendments to
Australian
Accounting
Standards –
Deferred Tax:
Recovery of
Underlying
Assets
[AASB 112]
Amendments to
Australian
Accounting
Standards –
Orderly Adoption
of Changes to the
ABS GFS Manual
and Related
Amendments
[AASB 1049]
Amendments to
Australian
Accounting
Standards –
Presentation of
Other
Comprehensive
Income
[AASB 1, 5, 7,
101, 112, 120,
121, 132, 133,
134, 1039 &
1049]
These amendments address the determination of
deferred tax on investment property measured at
fair value and introduce a rebuttable presumption
that deferred tax on investment property
measured at fair value should be determined on
the basis that the carrying amount will be
recoverable through sale. The amendments also
incorporate SIC‐21 Income Taxes – Recovery of
Revalued Non‐Depreciable Assets into AASB 112.
This Standard makes amendments including
clarifying the definition of the ABS GFS Manual,
facilitating the orderly adoption of changes to the
ABS GFS Manual and related disclosures to AASB
1049.
1 July 2012
N/A
Amendments to Australian Accounting Standards –
Improvements to AASB 1049 can be found in AASB
2011‐13.
This Standard requires entities to group items
presented in other comprehensive income on the
basis of whether they might be reclassified
subsequently to profit or loss and those that will
not.
1 July 2012
1 July 2012
‐ 44 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Application
date of
standard*
Application
date for
Group*
1 January
2013***
1 July 2013
Reference
Title
Summary
AASB 9
Financial
Instruments
AASB 9 includes requirements for the classification
and measurement of financial assets. It was
further amended by AASB 2010‐7 to reflect
amendments to the accounting for financial
liabilities.
These requirements improve and simplify the
approach for classification and measurement of
financial assets compared with the requirements
of AASB 139. The main changes are described
below.
a)
Financial assets that are debt instruments will
be classified based on (1) the objective of the
entity’s business model for managing the
financial assets; (2) the characteristics of the
contractual cash flows.
b) Allows an irrevocable election on initial
recognition to present gains and losses on
investments in equity instruments that are
not held for trading in other comprehensive
income. Dividends in respect of these
investments that are a return on investment
can be recognised in profit or loss and there is
no impairment or recycling on disposal of the
instrument.
c)
Financial assets can be designated and
measured at fair value through profit or loss
at initial recognition if doing so eliminates or
significantly reduces a measurement or
recognition inconsistency that would arise
from measuring assets or liabilities, or
recognising the gains and losses on them, on
different bases.
d) Where the fair value option is used for
financial liabilities the change in fair value is
to be accounted for as follows:
The change attributable to changes in credit
risk are presented in other comprehensive
income (OCI).
The remaining change is presented in profit or
loss.
If this approach creates or enlarges an
accounting mismatch in the profit or loss, the
effect of the changes in credit risk are also
presented in profit or loss.
Consequential amendments were also made to
other standards as a result of AASB 9, introduced
by AASB 2009‐11 and superseded by AASB 2010‐7
and 2010‐10.
‐ 45 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Application
date of
standard*
Application
date for
Group*
1 January
2013
1 July 2013
1 January
2013
1 July 2013
1 January
2013
1 July 2013
Reference
Title
Summary
AASB 10
Consolidated
Financial
Statements
AASB 11
Joint
Arrangements
AASB 12
Disclosure of
Interests in Other
Entities
AASB 10 establishes a new control model that
applies to all entities. It replaces parts of AASB
127 Consolidated and Separate Financial
Statements dealing with the accounting for
consolidated financial statements and UIG‐112
Consolidation – Special Purpose Entities.
The new control model broadens the situations
when an entity is considered to be controlled by
another entity and includes new guidance for
applying the model to specific situations, including
when acting as a manager may give control, the
impact of potential voting rights and when holding
less than a majority voting rights may give control.
Consequential amendments were also made to
other standards via AASB 2011‐7.
AASB 11 replaces AASB 131 Interests in Joint
Ventures and UIG‐113 Jointly‐ controlled Entities –
Non‐monetary Contributions by Ventures. AASB 11
uses the principle of control in AASB 10 to define
joint control, and therefore the determination of
whether joint control exists may change. In
addition it removes the option to account for
jointly controlled entities (JCEs) using
proportionate consolidation. Instead, accounting
for a joint arrangement is dependent on the nature
of the rights and obligations arising from the
arrangement. Joint operations that give the
venturers a right to the underlying assets and
obligations themselves is accounted for by
recognising the share of those assets and
obligations. Joint ventures that give the venturers
a right to the net assets is accounted for using the
equity method.
AASB 12 includes all disclosures relating to an
entity’s interests in subsidiaries, joint
arrangements, associates and structures entities.
New disclosures have been introduced about the
judgments made by management to determine
whether control exists, and to require summarised
information about joint arrangements, associates
and structured entities and subsidiaries with non‐
controlling interests.
‐ 46 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Application
date of
standard*
Application
date for
Group*
1 January
2013
1 July 2013
1 January
2013
1 July 2013
Reference
Title
Summary
AASB 13
Fair Value
Measurement
AASB 119
Employee
Benefits
AASB 13 establishes a single source of guidance for
determining the fair value of assets and liabilities.
AASB 13 does not change when an entity is
required to use fair value, but rather, provides
guidance on how to determine fair value when fair
value is required or permitted. Application of this
definition may result in different fair values being
determined for the relevant assets.
AASB 13 also expands the disclosure requirements
for all assets or liabilities carried at fair value. This
includes information about the assumptions made
and the qualitative impact of those assumptions
on the fair value determined.
Consequential amendments were also made to
other standards via AASB 2011‐8.
The main change introduced by this standard is to
revise the accounting for defined benefit plans.
The amendment removes the options for
accounting for the liability, and requires that the
liabilities arising from such plans is recognized in
full with actuarial gains and losses being
recognized in other comprehensive income. It also
revised the method of calculating the return on
plan assets.
The revised standard changes the definition of
short‐term employee benefits. The distinction
between short‐term and other long‐term
employee benefits is now based on whether the
benefits are expected to be settled wholly within
12 months after the reporting date.
Consequential amendments were also made to
other standards via AASB 2011‐10.
‐ 47 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Application
date of
standard*
Application
date for
Group*
1 January
2013
1 July 2013
1 July 2013
1 July 2013
Reference
Title
Summary
This interpretation applies to stripping costs
incurred during the production phase of a surface
mine. Production stripping costs are to be
capitalised as part of an asset, if an entity can
demonstrate that it is probable future economic
benefits will be realised, the costs can be reliably
measured and the entity can identify the
component of an ore body for which access has
been improved. This asset is to be called the
“stripping activity asset”.
The stripping activity asset shall be depreciated or
amortised on a systematic basis, over the expected
useful life of the identified component of the ore
body that becomes more accessible as a result of
the stripping activity. The units of production
method shall be applied unless another method is
more appropriate.
Consequential amendments were also made to
other standards via AASB 2011‐12.
This Amendment deletes from AASB 124 individual
key management personnel disclosure
requirements for disclosing entities that are not
companies.
Interpretation
20
Stripping Costs in
the Production
Phase of a
Surface Mine
AASB 2011‐4
Amendments to
Australian
Accounting
Standards to
Remove
Individual Key
Management
Personnel
Disclosure
Requirements
[AASB 124]
‐ 48 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Reference
Title
Summary
Application
date of
standard*
Application
date for
Group*
Annual
Improvements
2009–2011
Cycle ****
Annual
Improvements to
IFRSs 2009–2011
Cycle
This standard sets out amendments to
International Financial Reporting
1 January
2013
1 July 2013
Standards (IFRSs) and the related bases for
conclusions and guidance made during the
International Accounting Standards Board’s Annual
Improvements process. These amendments have
not yet been adopted by the AASB.
The following items are addressed by this
standard:
AASB 1 First‐time Adoption of International
Financial Reporting Standards
Repeated application of IFRS 1
Borrowing costs
AASB 101 Presentation of Financial Statements
Clarification of the requirements for
comparative information
AASB 116 Property, Plant and Equipment
Classification of servicing equipment
AASB 132 Financial Instruments: Presentation
Tax effect of distribution to holders of equity
instruments
AASB 134 Interim Financial Reporting
Interim financial reporting and segment
information for total assets and liabilities
‐ 49 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Application
date of
standard*
Application
date for
Group*
1 July 2013
1 July 2013
Reference
Title
Summary
AASB 1053
Application of
Tiers of
Australian
Accounting
Standards
This Standard establishes a differential financial
reporting framework consisting of two Tiers of
reporting requirements for preparing general
purpose financial statements:
a) Tier 1: Australian Accounting Standards
b) Tier 2: Australian Accounting Standards –
Reduced Disclosure Requirements
Tier 2 comprises the recognition, measurement
and presentation requirements of Tier 1 and
substantially reduced disclosures corresponding to
those requirements.
The following entities apply Tier 1 requirements in
preparing general purpose financial statements:
a)
For‐profit entities in the private sector that
have public accountability (as defined in this
Standard)
b) The Australian Government and State,
Territory and Local Governments
The following entities apply either Tier 2 or Tier 1
requirements in preparing general purpose
financial statements:
a)
For‐profit private sector entities that do not
have public accountability
b) All not‐for‐profit private sector entities
c) Public sector entities other than the
Australian Government and State, Territory
and Local Governments.
Consequential amendments to other standards to
implement the regime were introduced by AASB
2010‐2, 2011‐2, 2011‐6, 2011‐11 and 2012‐1.
‐ 50 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
2.
SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS
In applying the Consolidated Entity’s accounting policies management continually evaluates estimates and assumptions
based on experience and other factors, including expectations of future events that may have an impact on the Consolidated
Entity. All estimates and assumptions made are believed to be reasonable based on the most current set of circumstances
available to management. Actual results may differ from the estimates and assumptions. Significant estimates and
assumptions made by the management in the preparation of these financial statements are outlined below:
Significant accounting estimates and assumptions
The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future
events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying
amounts of certain assets and liabilities within the next annual reporting period are:
Impairment of capitalised exploration and evaluation expenditure
(a)
The future recoverability of capitalised exploration expenditure is dependent on a number of factors, including whether the
Consolidated Entity decides to exploit the related lease itself or, if not, whether it successfully recovers the related
exploration and evaluation asset through sale. Factors that could impact the future recoverability include the level of
reserves and resources, future technological changes, which could impact the cost of mining, future legal changes (including
changes to environmental restoration obligations) and changes to commodity prices. To the extent that capitalised
exploration and evaluation expenditure is determined not to be recoverable in the future, profits and net assets will be
reduced in the period in which this determination is made. In addition, exploration and evaluation is capitalised if activities in
the area of interest have not yet reached a stage that permits a reasonable assessment of the existence or otherwise of
economically recoverable reserves. To the extent it is determined in the future that this capitalised expenditure should be
written off, profits and net assets will be reduced in the period in which this determination is made.
Share‐based payment transactions
(b)
The Consolidated Entity measures the cost of equity‐settled transactions with employees by reference to the fair value of the
equity instruments at the date at which they are granted. The fair value is determined by an external valuer using either a
binomial or Black‐Scholes model, with the assumption detailed in Note 17. The accounting estimates and assumptions
relating to equity‐settled share‐based payments would have no impact on the carrying amount of assets and liabilities within
the next annual reporting period but may impact expenses and equity.
‐ 51 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
3. REVENUE AND EXPENSES
(Loss) after crediting the following revenues:
Other Revenues
Interest received
Sale of tenements
Profit on sale of shares
Loss after charging the following expenses:
Consolidated
2012
$
2011
$
71,160
‐
97,830
168,990
161,467
885,327
‐
1,046,794
Auditors remuneration in respect of the Audit of the financial statements
49,698
50,428
Provision for employee benefits
Operating lease payments
Superannuation
4.
INCOME TAX
Operating loss before income tax
Prima facie income tax (benefit)
calculated at 30% (2011: 30%)
Non‐deductible expenses
Less deferred tax benefits not brought to
account at balance date
Research and development grant
Total income tax (expense)/benefit
12,811
21,124
36,501
34,849
89,416
60,861
(2,649,846)
(1,870,128)
(794,953)
(561,038)
2,387
193,871
792,566
367,167
‐
‐
230,041
230,041
Cullen Resources Limited and its 100% owned subsidiaries have entered the tax consolidation regime from 1 July
2002. The head entity of the tax consolidation group is Cullen Resources Limited.
The entity has adopted the stand alone taxpayer method for measuring current and deferred tax amounts. The
members of the income tax consolidated group have entered into a tax funding agreement.
‐ 52 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Consolidated
Deferred Tax Liabilities
Statement of Financial
Position
Statement of Comprehensive
Income
2012
$
2011
$
2012
$
2011
$
Exploration
(1,125,587)
(942,750)
182,836
157,861
Deferred Tax Assets
Provisions
Accruals
Other
Deferred tax assets used to
Offset deferred tax liabilities
Net Deferred Tax Recognised
in the Statement of Financial Position
49,747
10,500
‐
45,904
7,500
‐
3,843
‐
‐
6,337
‐
‐
1,065,340
889,346
(178,993)
(151,524)
‐
‐
‐
‐
As at 30 June 2012 future income tax benefits were available to the Consolidated Entity in respect of operating
losses and prospecting and exploration expenditure incurred. The directors estimate the potential income tax
benefit at 30 June 2012 in respect of tax losses not brought to account is $12,846,089 (2011: $12,110,776) and
there is no expiry date. The benefit of these losses has not been brought to account. The benefit will only be
obtained if:
(a)
(b)
(c)
the Consolidated Entity derives future assessable income of a nature and of sufficient amount to enable
the benefit to be realised.
the Consolidated Entity continues to comply with the conditions for deductibility imposed by the law; and
no changes in tax legislation adversely affect the Consolidated Entity in realising the benefit.
5. RECEIVABLES
Current
Other debtors
Other debtors includes GST receivable which is non‐interest bearing.
6. OTHER FINANCIAL ASSETS
Non current
Security deposits
Available for sale financial assets comprise:
Listed investments at fair value
‐ Shares in listed corporations
The security deposits are non‐interest bearing and relate to mining tenements.
Consolidated
2012
$
2011
$
144,015
69,156
32,400
10,000
‐
32,400
530,450
540,450
‐ 53 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
7. PLANT & EQUIPMENT
Plant & Equipment at cost
Accumulated depreciation
Total written down amount
(a) Reconciliation
Plant & Equipment
Carrying amount at beginning
Additions
Depreciation expense
8. EXPLORATION & EVALUATION
Costs carried forward in respect of
areas of interest in the exploration
and evaluation phase
Opening balance
Expenditure incurred during the year
Less
Impairment (a)
Closing balance net of impairment
Consolidated
2012
$
2011
$
161,533
(155,559)
5,974
161,533
(149,925)
11,608
11,608
‐
(5,634)
5,974
14,102
5,821
(8,315)
11,608
3,142,502
2,619,442
5,761,944
2,616,296
1,765,393
4,381,689
(2,009,986)
(1,239,187)
3,751,958
3,142,502
Mining tenements are carried forward in accordance with the accounting policy set out in Note 1.
The ultimate recoupment of the book value of deferred costs relating to areas of interest in the exploration and
evaluation phase is dependent upon the successful development and commercial exploitation or, alternatively, sale
of the respective areas of interest and the Consolidated Entity’s ability to continue to meet its financial obligations to
maintain the areas of interest.
(a) Impairment
The directors have reviewed all exploration projects for indicators of impairment in light of approved budgets.
Where substantive expenditure is neither budgeted nor planned the area of interest has been written down to its
fair value less costs to sell. In determining fair value less costs to sell the directors had regard to the best evidence of
what a willing participant would pay in an arms length transaction. Where no such evidence was available, areas of
interest were written down to nil pending the outcome of any future farm‐out arrangement. The Company will
continue to look to attract farm‐in partners and/or recommence exploration should circumstances change.
9. TRADE AND OTHER PAYABLES
Current
Trade creditors ‐ unsecured
814,465
194,816
Trade creditors are non‐interest bearing and are normally settled on 30 day terms.
‐ 54 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
10. PROVISIONS
Current
Employee benefits
Non Current
Employee benefits
11. CONTRIBUTED EQUITY
Issued capital
693,089,431 ordinary shares
(2011: 623,089,431)
Movement in issued shares for the year:
Beginning of the financial year:
Issued at 3.00 cents each (i)
Issued at 4.50 cents each (ii)
Less share issue expenses
End of financial year:
Consolidated
2012
$
2011
$
143,597
135,956
22,226
17,056
36,605,266
34,610,266
2012
2011
Number of
Shares
623,089,431
70,000,000
‐
‐
693,089,431
$
Number of
$
34,610,266
2,100,000
‐
(105,000)
36,605,266
Shares
557,839,763
‐
65,249,668
‐
623,089,431
31,724,656
‐
2,936,235
(50,625)
34,610,266
Ordinary shares have the right to receive dividends as declared and, in the event of winding up the company, to
participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid
upon shares held.
Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the company.
(i) Issued under a placement.
(ii) Issued under a placement and a Share Purchase Plan.
Options
As at 30 June 2012 there are 22,000,000 (2011: 22,000,000) unissued shares in respect of which options were
outstanding and the details of these are as follows:
Number
Grant Date
Vesting Date
16,000,000
6,000,000
22,000,000
1/12/10
14/03/11
1/12/10
14/03/11
Exercise
Price
0.075
0.060
Expiry Date
30 November 2013
13 March 2014
∆ All options have vested
The options have no rights until they are exercised and become ordinary shares.
During the year nil (2011: 14,000,000) options lapsed.
During the year Nil (2011: 22,000,000) options were issued.
Since the end of the financial year no shares have been issued by virtue of the exercise of options.
‐ 55 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
12. SHARE BASED PAYMENT RESERVE
The share based payment reserve represents the cost of share‐based payments to directors, employees and
third parties.
Beginning of the financial year
Share based payments
End of financial year
13. AVAILABLE FOR SALE RESERVE
Consolidated
2012
$
1,280,125
‐
1,280,125
2011
$
728,925
551,200
1,280,125
This relates to the movement in the fair valuation of financial assets.
Beginning of the financial year
Net change in fair value of financial assets during the year
Release of unrealised loss reserve due to impairment
End of financial year
(20,000)
‐
20,000
‐
‐
(149,550)
129,550
(20,000)
14. ACCUMULATED LOSSES
Accumulated losses at the beginning of the year
Net (loss)
Accumulated losses at the end of the year
(29,822,246)
(2,649,846)
(32,472,092)
(28,182,159)
(1,640,087)
(29,822,246)
15. PARTICULARS IN RELATION TO CONTROLLED ENTITIES
The consolidated financial statements at 30 June 2012 include the following controlled entities. The financial
years of all controlled entities are the same as that of the parent entity.
Place of
Incorporation
Interest
%
Investment
$
Name
June
2012
June
2011
Cullen Minerals Pty Limited
Cullen Exploration Pty Ltd
Montrose Resources Pty Limited
Red Dirt Resources Pty Ltd
Bearmark Investments Pty Ltd
Cullen Resources Namibia Pty Ltd
Cullen Exploration Inc.
ARCTEX OY
ARCTEX AB
Australia
Australia
Australia
Australia
Botswana
Namibia
Canada
Finland
Sweden
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
‐
‐
100
June
2012
‐
‐
1
1
‐
15
1
4,072
7,915
June
2011
‐
‐
1
1
‐
15
‐
‐
7,915
‐ 56 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
16. KEY MANAGEMENT PERSONNEL
(a)
Compensation for key management personnel
Short‐term employee benefits
Post‐employment benefits
Other long‐term benefits
Termination benefits
Share‐based payments
Total compensation
(b)
Option holdings of directors
Consolidated
2012
$
2011
$
528,611
36,000
8,208
‐
‐
572,819
502,917
34,223
24,139
‐
443,200
1,004,479
Balance at
beginning of
year 1 July 2011
Number
Options
issued
Number
Options
lapsed
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
‐
‐
‐
‐
‐
‐
Balance at end
of year
30 June 2012
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
Vested and
exercisable at
30 June 2012
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
Total
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
16,000,000
16,000,000
‐
‐
‐
‐
‐
‐
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
The outstanding options are exercisable at $0.075 and have an expiry date of 30 November 2013.
These options had a weighted average exercise price of $0.075 and a weighted average remaining contractual
life of 1.42 years.
Balance at
beginning of
year
1 July 2010
Number
*2,000,000
‐
*2,000,000
*2,000,000
*2,000,000
8,000,000
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
Options
issued
Number
2,000,000∆
8,000,000∆
2,000,000∆
2,000,000∆
2,000,000∆
16,000,000∆
Options
lapsed
Number
*(2,000,000)
‐
*(2,000,000)
*(2,000,000)
*(2,000,000)
(8,000,000)
Balance at end
of year
30 June 2011
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
Vested and
exercisable at
30 June 2011
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
Total
Number
2,000,000
8,000,000
2,000,000
2,000,000
2,000,000
16,000,000
*
∆
The outstanding options are exercisable at $0.1338 and have an expiry date of 30 November 2010 and
expired during the year.
The outstanding options are exercisable at $0.075 and have an expiry date of 30 November 2013.
These options had a weighted average exercise price of $0.075 and a weighted average remaining contractual
life of 2.42 years.
‐ 57 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
(c)
Shareholdings of directors
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
Directors
D Clarke
C Ringrose
G Hamilton
J Horsburgh
W Kernaghan
Total
Balance
1 July 2011
Number
3,383,000
200,000
15,141,004
16,103,124
3,333,000
38,160,128
Balance
1 July 2010
Number
3,050,000
200,000
14,808,004
15,770,124
3,000,000
36,828,128
Options
Exercised
Number
‐
‐
‐
‐
‐
‐
Options
Exercised
Number
‐
‐
‐
‐
‐
‐
Net Change
Purchase
Number
1,231,000
‐
‐
599,000
290,376
2,120,376
Net Change
Purchase
Number*
333,000
‐
333,000
333,000
333,000
1,332,000
Balance
30 June 2012
Number
4,614,000
200,000
15,141,004
16,702,124
3,623,376
40,280,504
Balance
30 June 2011
Number
3,383,000
200,000
15,141,004
16,103,124
3,333,000
38,160,128
* Transaction participating in share purchase plan.
The directors' shareholdings are held directly and indirectly. Refer to the Directors' Report on page 25 for the
breakdown.
17. SHARE BASED PAYMENTS
(a)
Recognised share based payment expenses
Director options
Employee options
(b)
(i)
Employee Options
Options held at the beginning of the reporting period
Number
Grant Date
Vest Date
Expiry Date
2012
$
‐
‐
‐
2011
$
443,200
108,000
551,200
Weighted
Average
Exercise Price
6,000,000
14/3/11
14/3/11
13/3/14
$0.06
(ii)
Options lapsed / exercised during the year
Number
Grant Date
‐
‐
Exercise
Date
‐
Exercise
Price
‐
Number
Lapsed
‐
‐ 58 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
(iii)
Options issued during the year
Number
Grant Date
Vest Date
Expiry Date
‐
‐
‐
‐
(iv)
Options held at the end of the reporting period
Number
Grant Date
Vest Date
Expiry Date
Weighted
Average
Exercise
Price
‐
Exercise
Price
6,000,000
14/3/11
14/3/11
13/3/14
$0.06
Weighted
Average
Share Price
‐
Weighted Average
Fair Value
of Options
$0.0216
These options had a weighted average exercise price of $0.06 and a weighted average remaining contractual
life of 1.75 years.
The fair value of the equity settled share options granted are estimated as at the date of allocation using a
Binomial Model taking into account the terms and conditions upon which they were granted.
(v)
Valuation of options issued during the year
Number
Grant Date
Vest Date
Expiry Date
Exercise
Price
‐
‐
‐
‐
‐
Weighted Average
Fair Value
of Options
‐
(c)
Weighted average remaining contractual life
Options ‐ Employee
Options ‐ Directors
(d)
Range of exercise prices
Options ‐ Employee
Options ‐ Directors
(e)
Weighted average fair value at date of issue
2012
Years
1.75
1.42
2012
$
0.06
0.75
2012
$
2011
Years
2.75
2.42
2011
$
0.06
0.075
2011
$
Options ‐ Employee
Options ‐ Directors
0.0216
0.0277
0.0216
0.0277
‐ 59 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Option pricing model
(f)
The fair value of the equity settled share options granted are estimated as at the date of allocation using a
Binomial Model taking into account the terms and conditions upon which they were granted.
The following table lists the inputs to the models used at the date of allocation for employee options:
Dividend yield
Expected volatility
Risk free interest rate
Exercise price
Share price at measurement date
2012
‐
‐
‐
‐
‐
2011
‐
85.00%
5.30%
$0.06
$0.039
The following table lists the inputs used at the date of allocation for directors’ options:
Dividend yield
Expected volatility
Risk free interest rate
Exercise price
Share price at measurement date
18. JOINT VENTURES
2012
2011
‐
‐
‐
‐
‐
‐
104.11%
4.98%
$0.075
$0.048
The Consolidated Entity has interests in the following jointly controlled assets:
Principal Activity
Other Participant
(a) Irwin Bore (Cullen operates)
Exploration
Western Australian Resources Ltd (WAR)
(b) Hardey Junction
Exploration
Northern Star Resources Ltd (Northern Star)
(c) Mt Stuart
Exploration
Australian Premium Iron Management Pty Limited (API)
(d) Wyloo
Exploration
Fortescue Mining Group Limited (Fortescue)
(e) Tunnel Creek/Saltwater Pool
Exploration
Thundelarra Exploration Limited (Thundelarra) / U3O8
Limited (U3O8) – now Avocet Resources Limited
(f) Paraburdoo
Exploration
Fortescue Mining Group Limited (Fortescue)
(g) Forrestania
Exploration
Hannans Reward Limited (Hannans)
(h) Killaloe
Exploration
Matsa Resources Limited (Matsa)
(i) Canning Basin
Exploration
Advaita Canning Resources Pty Ltd (Advaita)
(j) TL Property, Canada
Exploration
TL Syndicate
a)
b)
c)
d)
e)
f)
Cullen has a 90% interest, WAR retains a 10% interest.
Northern Star has an 80% interest, Cullen is 20% free carried.
API has earned a 70% interest in the iron ore rights and Cullen is contributing at 30% for its interest.
Fortescue can earn up to 80% in the iron ore rights.
Thundelarra/Avocet can earn 70%.
Fortescue can earn 80% in the iron ore rights.
‐ 60 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
g)
Hannans has an 80% interest; Cullen is 20% free carried.
h) Matsa can earn a 70% interest.
i)
j)
Advaita Canning Resources Pty Ltd can earn up to 75% interest in the coal rights.
Cullen can earn 80%.
The joint venture assets are not separate legal entities. They are contractual arrangements between the participants for the
sharing of costs and any outputs and do not, in themselves, generate revenue and profit. The net contribution of any joint
venture activities to the operating profit before income tax is $Nil (2011: $Nil). The Consolidated Entity’s assets employed in
the joint ventures, are included in the balance sheet of the Consolidated Entity as follows:
Current Assets
Receivables
Non‐Current Assets
Exploration and expenditure
Current Liabilities
Trade and other payables
19. COMMITMENTS
(a) Minimum exploration work
Consolidated
2012
$
2011
$
83,331
28,421
3,655,754
3,056,707
55,518
‐
The Consolidated Entity has certain obligations to perform minimum exploration work and expend minimum amounts of
money on mineral exploration tenements. The Consolidated Entity has committed to expend a minimum of $2,302,380
(2011: $3,607,220) over the next year to keep its current tenements in good standing. Approximately 68% (2011: 61%) of
this expenditure will be met by our Joint Venture partners.
(b) Joint Venture commitment
The Consolidated Entity has certain obligations in respect to the Mt Stuart JV and maybe required to expend further funds
over the next year being its share of the joint venture expenditure.
(c) Lease expenditure commitments
Lease expenditure commitment
Operating leases (non‐cancellable) for premises
Minimum lease payments
‐
‐
not later than one year
later than one year and not later than five years
Aggregate lease expenditure contracted for at reporting
date but not provided for
Consolidated
2012
$
2011
$
41,616
24,276
35,388
56,031
65,892
91,419
This lease for the premises is for the period 1 February 2010 to 31 January 2014 with an option for a further five years.
There are no contingent rentals or restrictions imposed by the lease arrangements.
‐ 61 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
20. RELATED PARTIES
Payments to director related companies
Transactions between related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated.
Geological payments were made to Innerleithen Pty Ltd totalling nil (2011: nil) which is a company controlled by Mr J
Horsburgh. Geological payments were made to Weeroona Investments Pty Ltd totalling $80,775 (2011: $82,125) which is
a company controlled by Mr G Hamilton. Consultancy payments were made to Mosman Corporate Services Pty Ltd
totalling $41,000 (2011: $33,600) which is a company controlled by Mr W Kernaghan.
21. OPERATING SEGMENTS
Identification of Reportable Segments
The Consolidated Entity has based its operating segment on the internal reports that are reviewed and used by the executive
management team in assessing performance and in determining the allocation of resources.
The Consolidated Entity currently does not have production and is only involved in exploration. As a consequence, activities
in the operating segment are identified by management based on the manner in which resources are allocated, the nature of
the resources provided and the identity of the manager and country of expenditure. Discrete financial information about
each of these areas is reported to the executive management team on a monthly basis.
Based on this criteria, the Consolidated Entity has only one operating segment, being exploration, and the segment
operations and results are the same as the Consolidated Entity’s results.
Non Current Assets by Geographical regions:
Australia
Namibia
Canada
22. STATEMENT OF CASH FLOWS
Consolidated
2012
$
2011
$
3,718,044
‐
72,288
3,790,332
3,694,560
‐
‐
3,694,560
(i) Reconciliation of cash
For the purposes of the Statement of Cash Flows, cash includes cash at bank and short term deposits at call. Cash at the end
of the financial year as shown in the Statement of Cash Flows is reconciled to the related items in the Statement of Financial
Position as follows:
Cash on hand
(ii) Reconciliation of operating (loss)
after income tax to net cash used in operating activities
Operating (loss) after income tax
Add/(less) non cash items
Profit on sale of tenements
Profit on sale of investment
Impairment of available for sale assets
Depreciation
Share based payments
Provisions for employee benefits
Impairment exploration expenditure
(Decrease) / Increase in creditors
Decrease / (Increase) in receivables
Consolidated
2012
$
2011
$
2,459,240
2,632,257
(2,649,846)
(1,640,087)
‐
(97,830)
13,155
5,634
‐
12,811
2,009,986
619,649
(74,859)
(780,000)
‐
129,550
8,315
551,200
21,124
1,239,187
(216,771)
38,643
Net operating cashflows
(161,300)
(648,839)
‐ 62 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
Share based payments
During the year the Consolidated Entity made share based payments of $Nil (2011: $551,200) to directors and employees
of the Consolidated Entity.
23. EARNINGS/(LOSS)PER SHARE
Basic (loss) per share (cents per share)
Diluted (loss) per share (cents per share)
The following reflects the income and share data used
in the calculations of basic and diluted (loss) per share
Net (loss)
Weighted average number of ordinary shares used in
the calculation of basic and diluted earnings per share
Options on issue at year end are not dilutive and hence
not used in the calculation of diluted EPS
Consolidated
2012
2011
(0.41)
(0.41)
(0.27)
(0.27)
(2,649,846)
(1,640,087)
642,459,294
606,100,263
22,000,000
22,000,000
There are no instruments (e.g. share options) excluded from the calculation of diluted earnings per share that could
potentially dilute basic earnings per share in the future because they are antidilutive for either of the periods presented.
24. FINANCIAL INSTRUMENTS
The Group's financial instruments comprise receivables, payables, and cash and short‐term deposits.
The Group manages its exposure to key financial risks, including interest rate risk in accordance with the Group's financial risk
management policy. The objective of the policy is to support the delivery of the Group's financial targets whilst protecting
future financial security.
The Board reviews and agrees policies for managing each of these risks as summarised below.
Primary responsibility for identification and control of financial risks rests with the Board of Directors. Due to the size and
nature of the company's operations, and as the company does not use derivative instruments or debt, the directors do not
believe the establishment of a risk management committee is warranted.
Interest Rate Risk
(a)
The Group's exposure to market interest rates relates primarily to the Group's cash and cash equivalents.
The Group's exposure to interest rate risk for each class of financial assets and financial liabilities is set out below.
Financial Instruments
Financial Assets
Cash and cash equivalents
Total Financial Assets
Cash gives rise to interest rate risk because the interest rate is variable.
Consolidated
Floating
interest rate
Floating
interest rate
2012
$
2011
$
2,459,240
2,632,257
2,459,240
2,632,257
‐ 63 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
The following summarises the effect on loss and equity of financial instruments held at balance date as a result of a 1%
movement in interest rates, with all other variables remaining constant.
Interest rate +1%
Interest rate ‐1%
Consolidated
2012
$
(24,592)
24,592
2011
$
(26,322)
26,322
The selection of 1% sensitivity check was based on recent interest rate adjustments.
(b) Currency Risk
The Consolidated Entity has limited exposure to foreign currency risk as it pays for its overseas exploration activities from
Australia in various overseas currencies.
(c) Price Risk
The Consolidated Entity has exposure to equity securities price risk.
The Group's exposure to equity price risk for available for sale financial assets is set out below.
Available for sale financial assets
Consolidated
Listed investments
Total Listed Investments
2012
$
‐
‐
2011
$
530,450
530,450
The following summarises the effect on loss and available for sale financial assets held at balance date as a result of a 10%
movement in listed security prices, with all other variables remaining constant.
Listed security prices +10%
Listed security prices ‐10%
The selection of 10% sensitivity check was considered appropriate.
Consolidated
2012
$
‐
‐
2011
$
(53,045)
53,045
(d) Credit Risk
Credit risk arises from the financial assets of the Consolidated Entity, namely trade and other receivables. The Consolidated
Entity's exposure to credit risk arises from potential default of the counter party, with a maximum exposure equal to its
carrying amount. Exposure at balance date is addressed in each applicable note.
The Consolidated Entity does not hold any credit derivatives to offset its credit exposure.
Receivable balances are monitored on an ongoing basis with the result that the Consolidated Entity's exposure to bad debts is
not significant.
There are no significant concentrations of credit risk within the Consolidated Entity and cash and cash equivalents are spread
amongst two of the big four Australian Banks.
(e) Liquidity Risk
The liquidity position of the Consolidated Entity is managed to ensure sufficient liquid funds are available to meet the
Consolidated Entity's financial commitments in a timely and cost‐effective manner. The Consolidated Entity funds its activities
through capital raisings in order to limit its liquidity risk which is monitored on a monthly basis.
Contractual maturity of the trade payables is within 30 day terms.
The Consolidate Entity manages its liquidity risk by monitoring the total cash inflows and outflows expected on a monthly basis.
The Consolidated entity has established comprehensive risk reporting covering its business units that reflect expectations of
management of the expected statement of financial assets and liabilities.
‐ 64 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
(f) Fair Values
The Consolidated Entity uses various methods in estimating the fair value of a financial instrument. The methods comprise:
Level 1 – the fair value is calculated using quoted prices in active markets
Level 2 – the fair value is estimated using inputs other than quoted prices included in Level 1 that are observable for the asset
or liability, either directly(as prices) or indirectly (derived from prices).
Level 3 – the fair value is estimated using inputs for the asset or liability that are not based on observable market data.
The fair value of the financial instruments as well as the methods used to estimate the fair value are summarised in the table below.
Quoted
Market
Price
(Level 1)
$
‐
‐
30 June 2012
Valuation
technique‐
market
observable
inputs
(Level 2)
$
Valuation
technique‐
non market
observable
inputs
(Level 3)
$
‐
‐
‐
‐
30 June 2011
Total
$
‐
‐
Quoted
Market
Price
(Level 1)
$
530,450
530,450
Valuation
technique‐
market
observable
inputs
(Level 2)
$
Valuation
technique‐
non market
observable
inputs
(Level 3)
$
Total
$
‐
‐
‐
‐
530,450
530,450
Financial Assets
Available for sale assets
‐ Listed Investments
Quoted market price represents the fair value determined based on quoted prices on active markets as at the reporting date
without any deductions for transaction costs. The fair value of the listed equity investments are based on quoted market prices.
There were no transfers between the categories during the year.
(g) Capital Management
Management controls the capital of the Consolidated Entity in order to provide the shareholders with adequate returns and
ensure that the group can fund its operations and continue as a going concern.
There are no externally imposed capital requirements.
Management effectively manages the group's capital by assessing the Consolidated Entity's financial risks and adjusting its
capital structure in responses to include the management of debt levels, distributions to shareholders and share issues.
The Consolidated Entity uses cash flow forecasts to manage and adjust its capital management.
There have been no changes in the strategy adopted by management to control the capital of the Consolidated Entity since the
prior year.
Capital managed by the Consolidated Entity consists of shareholders equity.
Consolidated
2012
$
2011
$
5,413,299
6,048,145
49,698
17,650
50,428
8,490
Shareholders equity
25. AUDITOR'S REMUNERATION
Amounts received or due and receivable
by Ernst and Young
‐
‐
an audit or review of the financial report
of the entity and any other entity in the
Consolidated Entity
taxation services provided to the Consolidated Entity
‐ 65 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
26. PARENT ENTITY INFORMATION
Information relating to Cullen Resources Limited.
Current assets
Total assets
Current liabilities
Total liabilities
Issued capital
Accumulated losses
Share based payment reserve
Available for sale reserve
Total shareholders' equity
Loss of the parent entity
Total comprehensive income of the parent entity
2012
$
2011
$
1,653,281
5,735,616
64,681
64,681
36,605,266
32,214,456
1,280,125
‐
5,670,935
2,446,207
2,446,207
2,137,113
6,148,600
46,459
46,459
34,610,266
29,822,246
1,280,125
(20,000)
6,048,145
1,660,103
1,660,103
The parent entity has no contingent liabilities, nor does it have any contractual commitments for the acquisition of property,
plant or equipment.
27. SUBSEQUENT EVENTS
There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or
event of a material and unusual nature likely, in the opinion of the directors, to affect the operations of the Consolidated
Entity, the results of those operations or the state of affairs of the Consolidated Entity in the subsequent financial years.
28. CORPORATE INFORMATION
The financial report of Cullen Resources Limited for the year ended 30 June 2012 was authorised for issue in accordance with
a resolution of the directors on 27 September 2012.
Cullen Resources Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the
Australian Stock Exchange.
‐ 66 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
DIRECTORS' DECLARATION
In accordance with a resolution of the directors of Cullen Resources Limited, I state that:
In the opinion of the directors:
(a)
the financial statements and notes of the Consolidated Entity are in accordance with the
Corporations Act 2001, including:
(i) giving a true and fair view of the Consolidated Entity’s financial position as at 30 June 2012
and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Regulations 2001; and
the financial statements and notes also comply with International Financial Reporting Standards as
disclosed in Note 1(b).
there are reasonable grounds to believe that the Consolidated Entity will be able to pay its debts
as and when they become due and payable.
this declaration has been made after receiving the declaration required to be made to the
directors in accordance with section 295A of the Corporations Act 2001 for the financial year
ending 30 June 2012.
(b)
(c)
(d)
On behalf of the Board
C. Ringrose
Director
Perth, WA
27 September 2012
‐ 67 ‐
Independent auditor's report to the members of Cullen Resources
Limited
Report on the financial report
We have audited the accompanying financial report of Cullen Resources Limited, which comprises the
consolidated statement of financial position as at 30 June 2012, the consolidated statement of
comprehensive income, the consolidated statement of changes in equity and the consolidated statement
of cash flows for the year then ended, notes comprising a summary of significant accounting policies and
other explanatory information, and the directors' declaration of the consolidated entity comprising the
company and the entities it controlled at the year's end or from time to time during the financial year.
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 Australian Accounting Standards and the Corporations Act 2001 and for
such internal controls as the directors determine are necessary to enable the preparation of the financial
report that is free from material misstatement, whether due to fraud or error. In Note 1, the directors
also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that
the financial statements comply with International Financial Reporting Standards.
Auditor's responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. Those standards require that we comply with
relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial report. The procedures selected depend on the auditor's judgment, including the assessment
of the risks of material misstatement of the financial report, whether due to fraud or error. In making
those risk assessments, the auditor considers internal controls relevant to the entity's preparation and
fair presentation of the financial report in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's
internal controls. An audit also includes evaluating the appropriateness of accounting policies used and
the reasonableness of accounting estimates made by the directors, as well as evaluating the overall
presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion.
Independence
In conducting our audit we have complied with the independence requirements of the Corporations Act
2001. We have given to the directors of the company a written Auditor’s Independence Declaration, a
copy of which is included in the directors’ report.
PM:MM:CULLEN:007
Liability limited by a scheme approved
under Professional Standards Legislation
Opinion
In our opinion:
a.
the financial report of Cullen Resources Limited is in accordance with the Corporations Act 2001,
including:
i
ii
giving a true and fair view of the consolidated entity's financial position as at 30 June 2012
and of its performance for the year ended on that date; and
complying with Australian Accounting Standards and the Corporations Regulations 2001;
and
b.
the financial report also complies with International Financial Reporting Standards as disclosed in
Note 1.
Report on the remuneration report
We have audited the Remuneration Report included in the directors' report for the year ended 30 June
2012. 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.
Opinion
In our opinion, the Remuneration Report of Cullen Resources Limited for the year ended 30 June 2012,
complies with section 300A of the Corporations Act 2001.
Material Uncertainty Regarding Continuation as a Going Concern
Without qualification to the audit opinion expressed above, attention is drawn to the following matter. As a
result of matters described in Note 1 – Going Concern to the financial report, there is material uncertainty
whether the group will be able be able to pay its debts as and when they fall due and payable and realise
its assets and extinguish its liabilities in the normal course of operations and at the amounts stated in the
financial report. The financial report does not include any adjustments relating to the recoverability and
classification of recorded asset amounts or to the amounts and classification of liabilities that might be
necessary should the group not continue as a going concern.
Ernst & Young
P McIver
Partner
Perth
27 September 2012
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
SHAREHOLDER INFORMATION
CAPITAL STRUCTURE
As at 26 September 2012, the company had the following securities on issue:
Issued Capital
Top 20 Shareholders
Total holding of twenty largest shareholders
% of total shares on issue
Distribution of shareholders
1 ‐ 1,000 shares
1,001 ‐ 5,000 shares
5,001 ‐ 10,000 shares
10,001 ‐ 100,000 shares
100,001 and over
Total
Unmarketable Parcels as at 26 September 2012
Minimum $500.00
Fully paid
Ordinary shares
693,089,431
309,205,123
44.61%
160
190
404
1,686
690
3,130
1,100
OPTIONS
As at 26 September 2012, 22,000,000 unissued shares in respect of options were outstanding.
These are as follows:
Number
16,000,000
6,000,000
Exercise Price
Expiry Date
$0.075
$0.06
30 November 2013
13 March 2014
SUBSTANTIAL SHAREHOLDERS
The company has three Substantial Shareholders as at 26 September 2012
Name
Brisbane Investments I and II
Mende and Kundrun
Aquila Resources Ltd
Wythenshawe & Associates
Pty Ltd
%
7.34
15.12
13.53
No. of shares
50,822,699
104,843,426
93,778,538
‐ 70 ‐
CULLEN RESOURCES LIMITED ‐ ANNUAL REPORT 2012
TWENTY LARGEST SHAREHOLDERS
The names of the twenty holders of the fully paid shares at 26 September 2012 are listed below:
Name
Penoir Pty Ltd
Glyde Street Nominees Pty Ltd
Wythenshawe Pty Ltd
Brisbane Investments I Ltd
Brisbane Investments II Ltd
Warramboo Holdings Pty Ltd
Wythenshawe Pty Ltd
Kitchsmith Pty Ltd
Innerleithen Pty Ltd
Aquila Resources Limited
Chiatta Pty Ltd
BT X Pty Ltd
H Wallace‐Smith and Co Pty Ltd
Penoir Pty Ltd
Lindglade Enterprises Pty Ltd
Warramboo Holdings Pty Ltd
A N Superannuation Pty Ltd
Mr Neil Ronald Griffin
ATFT Pty Ltd
Mr Brendon Russell Strong
Total
No. of Shares
% Held
Rank
72,000,000
10.39
33,000,000
27,747,378
25,411,350
25,411,349
15,250,000
14,757,698
14,688,002
13,284,120
11,846,603
9,000,000
8,500,000
7,998,266
5,690,123
4,614,000
4,598,462
4,000,000
3,874,355
3,833,000
3,700,417
4.76
4.00
3.67
3.67
2.20
2.13
2.12
1.92
1.71
1.30
1.23
1.15
0.82
0.67
0.66
0.58
0.56
0.55
0.53
309,205,123
44.61
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
VOTING RIGHTS
Every member present in person or by representative shall on a show of hands have one vote, and on a poll
every member present in person or by representative, proxy or attorney shall have one vote in respect of each
fully paid share held by him.
‐ 71 ‐
C U L L E N
R E S O U R C E S L I M I T E D
Registered and Principal Office
Unit 4
7 Hardy Street
South Perth WA 6151
Telephone (08) 9474 5511
Facsimile (08) 9474 5588
Website: www.cullenresources.com.au
Email: cullen@cullenresources.com.au
C U L L E N
R E S O U R C E S L I M I T E D
A N N U A L
R E P O R T 2 0 1 2