De Grey Mining Limited
Contents
Corporate Information ............................................................................................................................................................. 2
Chairman’s Letter ..................................................................................................................................................................... 3
Review of Operations ............................................................................................................................................................... 5
Directors’ Report .................................................................................................................................................................... 14
Audit Independence Declaration ........................................................................................................................................... 29
Consolidated Statement of Comprehensive Income ............................................................................................................. 30
Consolidated Statement of Financial Position ....................................................................................................................... 31
Consolidated Statement of Changes in Equity ....................................................................................................................... 32
Consolidated Statement of Cash Flows ................................................................................................................................. 33
Notes to the Consolidated Financial Statements ................................................................................................................... 34
Director’s Declaration ............................................................................................................................................................ 62
Audit Report ........................................................................................................................................................................... 63
ASX Additional Information ................................................................................................................................................... 68
Annual Mineral Resources Statement ................................................................................................................................... 70
Schedule of Interests in Mining Tenements .......................................................................................................................... 74
1
De Grey Mining Limited
Corporate Information
ABN 65 094 206 292
Directors
Simon Lill (Chairman)
Glenn Jardine (Managing Director)
Andrew Beckwith (Technical Director & Operations Manager)
Peter Hood AO (Non-Executive Director)
Eduard Eshuys (Non-Executive Director
Bruce Parncutt AO (Non-Executive Director)
Company Secretaries
Craig Nelmes (CFO)
Patrick Holywell
Registered Office and Principal Place of Business
Level 3, Suites 24-26,
22 Railway Road
SUBIACO WA 6008
Telephone: +61 (0)8 6117 9328
Facsimile: +61 (0)8 6117 9330
Postal Address
PO Box 2023,
SUBIACO WA 6904
Solicitors
Steinepreis Paganin
Level 4, The Read Buildings
16 Milligan Street
PERTH WA 6000
Automic Group
Level 2/267 St Georges Terrace
Perth WA 6000
Telephone: 1300 288 664
Auditors
Butler Settineri (Audit) Pty Ltd
Unit 16, First Floor Spectrum Offices
100 Railway Road
SUBIACO WA 6008
Internet Address
www.degreymining.com.au
Email Address
admin@degreymining.com.au
Stock Exchange Listing
Australian Securities Exchange (ASX code DEG)
Frankfurt Stock Exchange (FRA code WKN 633879)
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De Grey Mining Limited
Chairman’s Letter
Dear Shareholder,
My opening sentence last year stated that: “I am pleased to report that your company is in a significantly stronger position
today than it was twelve months ago.”
After a transformative year that statement is certainly truer today than last year, and it is with some pleasure that I present
to you the De Grey Mining Ltd annual report for the year ended 30 June 2020
In looking back, I note the 2020 financial year commenced with the introduction of Hemiphaga – now referred to as Hemi.
Hemi was one of seven new analogues of the Toweranna deposit that the De Grey geological team had identified through a
substantive amount of work undertaken to piece together a large historical database, to interrogate it, and to then identify
further intrusions.
The Hemi introduction was followed up with excellent aircore results released in December 2019 - which did not appear to
be noticed by the investment community. These in turn were followed up with the RC discovery results in February 2020 -
which were noticed.
During a difficult period for exploration capital, we undertook a $22M capital raising in July/August 2019 at what was a
significant discount to the prevailing market price as well as a $5M placement in November 2019. It was important to the
Board that the larger raise was concluded as an entitlements issue to ensure all shareholders had the opportunity to
participate in the discounted raising. The Company received applications for approximately 61% of the entitlements, with
the balance going to parties which had underwritten the issue. I am pleased to note that those shareholders which supported
and believed in the Company through the entitlements issue, through to the discovery announcement and hopefully beyond,
have been well rewarded.
This issue provided for the acquisition of Indee Gold for A$15 million and consequently the amalgamation of the bulk of De
Grey’s total land package. It was an ambitious transaction when De Grey first entered into it in 2017 with a market
capitalisation of $3M, but it was the foundation that results in De Grey now holding one of the most strategic and valuable
gold exploration land positions in WA.
Our drilling contractor, Top Drill, and our staff, supported us early in January to enable a rig to commence operations during
Pilbara’s wet season which in turn lead to the February discovery announcement. The number of drill rigs operating at Hemi
has grown to six as we rapidly test the extent of mineralisation. This also occurred while restrictions were in place for the
COVID-19 pandemic, so I commend and thank the discipline of the teams to safely maintain our high drilling productivity
rates.
We clearly are onto a major discovery at Hemi - the extent is such that at June 30 it had an overall scale of 2,000m north-
south and 1,200m east-west. In the three months since Hemi has further grown to 3,000m by 2,000m with five different
zones identified at this stage – Aquila, Brolga, Brolga South, Crow, and Falcon. We have not yet assessed the resource size,
but clearly the discovery costs are expected to be well below industry average.
We remain excited to the extent that the focus on Hemi has not allowed us to test mineralisation at the other intrusives
identified at the start of the financial year, nor the additional 20+ magnetic anomalies that may prove to also be intrusives.
Looking ahead, we will continue to use aircore, RC and diamond drilling to test the extent of Hemi and other intrusion targets
in the Greater Hemi area such as Scooby, Shaggy and Antwerp. This drilling will largely form the basis for a maiden Resource
Estimate for Hemi by the end of FY2021.
A dedicated team is also being established to focus on regional exploration beyond the Greater Hemi area to ensure the
substantial untested potential which exists here continues to be advanced.
Major discoveries like Hemi are often considered as being overnight successes - the reality is usually vastly different. The
complex process of consolidating, validating and interpreting the large historic datasets and designing an exploration
program to prioritise and advance the many targets across our 1,500km2 Mallina Gold Project cannot be underestimated.
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De Grey Mining Limited
De Grey’s exploration team, led by Executive Director Mr. Andy Beckwith, Exploration Manager Mr. Phil Tornatora and
Consulting Geologist Mr. Allan Kneeshaw, should be praised for completing this work which was an important pillar for the
discovery of Hemi.
I must also commend fellow Directors Mr Eduard (Ed) Eshuys and Mr Bruce Parncutt, who joined the Board during the year.
They first engaged with me in late 2017, recognising the potential of the Mallina Gold Province and De Grey.
They have always believed there would be a major discovery on our tenements, and in a bold move they led DGO Gold
Limited to invest substantial capital into that belief – now totalling $43M.
Their belief has certainly been vindicated and they continue to encourage further regional exploration activity in addition to
the intense activity at Hemi.
I should also acknowledge Mr Peter Hood as a valued and experienced Lead Independent Director who has provided me with
valuable counsel as the Company has grown with the corresponding additional scrutiny on Board processes.
At the end of the year I resigned as Executive Chairman following the earlier appointment of our new Managing Director, Mr
Glenn Jardine. Glenn has a skill set that I do not. He is an experienced mining engineer and executive who has a track record
of leading the development and operation of mines throughout Australia and overseas. He has made a fantastic contribution
to the organisation already and will be a strong leader for De Grey’s next phase of development.
Part of this transition also sees the Company searching for a new CFO who can support Glenn through studies, financing,
construction and into operation. Our current CFO, Mr. Craig Nelmes, joined me when we commenced our time at De Grey in
2013. He is also aware of the need to transition the Company and is fully supportive of the process. I do thank him personally
for his support to myself through the period, whilst noting that shareholders owe him a debt of gratitude. He has in recent
times been ably supported by Mr Pat Holywell.
We have also enjoyed the support of local aboriginal groups with whom we regularly engage as we move forward with
ongoing heritage clearances and into negotiations for mining agreements. Our key pastoral lease holders have also been
extremely helpful and supportive.
Finally, I thank all staff and contractors, past and present, and perhaps particularly our geological staff, our field staff and our
drilling contractors, Topdrill, Wallis Drilling and Bostech. There are other important contributors but without these groups
we would not have experienced the market growth we have, which has also resulted in us entering the S&P ASX300 and the
Van Eck GDXJ indices in recent weeks.
Capital raising activity during this calendar year has seen the completion of two raisings – A$32M in April 2020 and a more
recent A$100M in September 2020 post the balance date. We thank our brokers who supported us through these issues,
Argonaut Securities, Bell Potter and Canaccord Genuity. It is extremely pleasing to note the quality of the institutional support
that has now joined our register and which we hope will support us through to production and beyond. All new shareholders
are welcomed.
Finally, I give thanks to all of our shareholders for their support during the year. It is very satisfying to have been able to
deliver the first step in our vision of establishing a plus Tier 1 asset at the Mallina Gold Project through the Hemi discovery
and our existing resources. We believe we have the right elements in place to continue our momentum in FY2021.
Yours sincerely,
Simon Lill
Chairman
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De Grey Mining Limited
Review of Operations
De Grey Mining (“De Grey” or the “Company”) is engaged in gold exploration and development activities in one of the
world’s strongest Tier 1 mining jurisdictions. The Company has built up a dominant position in the prospective Mallina
Basin of the Pilbara Craton, located in the northwest of Western Australia.
The Mallina Gold Project (“Project”) comprises a landholding more than 1,500km2, stretching across a contiguous tenement
package running SW to NE of 150km and boasts greater than 200km of gold hosting shear zones and numerous intrusion
targets (Figure 1). The project currently has a gold resource of 2.2Moz (37.44Mt at 1.8g/t Au) and the New Hemi discovery
provides the opportunity to increase this resource base substantially.
Figure 1: Mallina Gold Project
During the year, De Grey’s exploration team has changed perceptions about the gold potential of the Pilbara with the major
Hemi discovery, first discovered in shallow aircore drilling in December 2019. Hemi is a new intrusion style of gold deposit
not previously recognised in the region. Hemi is a near surface, intrusion-hosted mineralisation which remains open in
multiple directions and now has five separate resource areas within the overall Hemi deposit – Aquila, Brolga, Brolga South,
Crow and Falcon.
Within 10km radius of Hemi, the Greater Hemi region, the Company has a further four large intrusion targets – Shaggy,
Scooby, Antwerp and Alectroenas. Each one of these targets have demonstrated gold mineralisation in limited shallow
drilling, except Alectroenas which remains to be drill tested.
The Project is located within a 45 minute drive of Port Hedland (Figure 1). The region is rich with critical infrastructure to
support a future mining operation. Two major sealed highways run within 20km of the Hemi discovery. A gas pipeline runs
within 20km of Hemi with a spur within 4km. A major 220kV electricity transmission line also lies within 20km of Hemi. The
town of Port Hedland is a significant regional centre with excellent mining services and large airport facilities, as has the
town of Karratha, 120km to the south west. Port Hedland is the largest economic export port in Australia. The Port is also
opening up for import shipping which is expected to allow the direct landing of mining equipment into the region, which
may provide substantial transport cost savings during development.
Forward looking to the 2020-21 year ahead, the Company plans to:
•
Continue drilling to extend and define the overall footprint of the Hemi discovery, leading to a maiden Hemi Mineral
Resource Estimate by the middle of calendar year 2021;
Explore and define new mineralised intrusions within the Greater Hemi region;
Explore the large prospective regional shear zones and other intrusion targets;
Continue to expand the existing 2.2Moz regional resources;
Improve site infrastructure, systems and communications to support planned activities;
Complete and evaluate early stage project de-risking studies including metallurgy, environmental, hydrology and
geotechnical aspects; and
Pursue a corporate strategy to develop a Tier 1 Gold Project, defined as a project producing a minimum of 300,000
ounces per year with a minimum mine life of 10 years.
•
•
•
•
•
•
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De Grey Mining Limited
Hemi Gold Discovery
Hemi is a major gold discovery made in the central area of the Mallina Gold Project. Hemi’s potential was first identified in
July 2019 after a period of detailed evaluation of past exploration data and new geological concepts developed by De Grey’s
exploration team. The “blind” discovery was subsequently made with shallow aircore drilling beneath 30m of barren
transported cover sediments in December 2019. The initial discovery results include:
•
•
43m @ 3.7g/t Au from 36m in BWAC245, including 12m @ 9.0g/t (BWAC245)
25m @ 2.7g/t Au from 32m in BWAC258, including 8m @ 4.5g/t (BWAC258)
Follow-up aircore drilling was undertaken from January 2020, returning substantial, thick and high-grade mineralisation on
two sections 640m apart, confirming the potential for a major gold discovery. Results from this program included:
•
•
•
•
24m @ 7.5g/t Au from 126m, including 18m @ 8.6g/t (BWAC315)
49m @ 3.7g/t Au from 65m, including 18m @ 6.6g/t (BWAC309)
36m @ 4.0g/t from 39m, including 11m @ 8.9g/t (BWAC245)
24m @ 4.2g/t Au from 36m, including 10m @ 7.4g/t (BWAC312)
RC and diamond drilling commenced during February 2020 with continued success and exciting broad zones of
mineralisation initially defined at the Brolga and Aquila Zones. The program rapidly increased to six rigs, (two RC, two
diamond rigs and two aircore) operating by June 2020. This growth in activity was all undertaken during the height of the
lockdown uncertainty created by COVID-19.
De Grey’s drilling strategy at Hemi has been to use shallow aircore drilling to discover and map out the strike orientation
and footprint of the mineralised intrusion before closer spaced (80m x 80m) follow-up RC and diamond drilling is
undertaken to defined the widths, grade and continuity of mineralisation.
Infill RC and diamond resource definition drilling has commenced more recently on tighter 80m x 40m drill spacing to
support the future estimation of a Mineral Resource for Hemi. The RC drilling is used to test to depth of approximately
200m and diamond drilling to extend at depth. Aircore drilling out from Hemi continues on wide spaced (640m to 320m)
traverses and has resulted in the discovery of Crow and the more recent Falcon zone.
By the end of the 2019-2020 financial year, a total of 67,500 metres of drilling had outlined a mineralisation footprint
spanning 2,000m north-south and 1,200m east-west across three the Aquila, Brolga and Crow zones. Drilling subsequent to
the end of the period, in total close to 150,000m, has extended this area to 3,000m north-south and 2,000m east-west.
Mineralisation remains open in all directions, including at depth.
Mineralisation at Hemi is characterised by consistent broad zones and of consistent grade with strong continuity along
strike. Gold is intimately associated with extensive brecciated and altered diorite to quartz diorite intrusive rocks with the
gold predominantly hosted within the strong sulphide development (pyrite and arsenopyrite). The Hemi style
mineralisation is markedly different to all the other deposits within the Project with a distinct lack of quartz veining being
an obvious difference.
This style of mineralisation has not previously been encountered in the Pilbara and has greatly increased the gold
prospectivity of the region. De Grey believes the Mallina Basin is the most prospective area within the Pilbara to host this
style of intrusion hosted mineralisation and validates the Company’s tenure consolidation strategy underway since 2018.
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Figure 2: Hemi – Overview
De Grey Mining Limited
Figure 3: Mallina Gold Project – Greater Hemi
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De Grey Mining Limited
Regional Exploration
Since the announcement of the Hemi discovery at Aquila and Brolga in February 2020, the Company has been focussed on
exploration in and around Hemi. There are multiple intrusion style targets in the Greater Hemi region (Figure 3) and an
additional three major gold rich intrusion targets, Charity Well, Geemas and Toweranna (520,000oz resource), defined in
the western portion of the project.
In June 2020, De Grey completed a detailed aeromagnetic survey over the Greater Hemi region and reassessed the entire
project data and defined over 20 new intrusion style targets across the regional tenement package (Figure 4). These initially
require further on-ground investigation followed up by aircore and RC drilling.
Figure 4: Airborne magnetic survey completed over the Project area
Our dedicated exploration team are currently housed in De Grey’s two exploration camps. The Hemi team are based at the
Wingina camp which was acquired in 2018 (Photo 1) and currently is being upgraded to cater for up to 72 personnel (Photo
2). The regional team are working from our Withnell camp that caters for up to a further 24 personnel.
Additionally, De Grey has had success expanding the shear zone hosted resources that exist on its tenements, all of which
remain open along strike and at depth. The Company is confident that new resources will exist across the shear zones,
whilst also expanding the existing shear zone hosted resources.
Photo 1: Wingina Camp near Indee Station – Before Commencement of an Upgrade
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Photo 2: Wingina Camp near Indee Station – Upgrade in Progress
De Grey Mining Limited
Project Studies
During 2019 and into the March quarter 2020, the Company further advanced economic studies based on a proposed open
pit and underground mining operation at the Withnell deposit. Studies proposed the building of a new standalone
centralised processing plant to be located at Withnell. The processing plant design had progressed to a combined 3Mtpa
throughput based on 2Mtpa of oxide and free milling ores and 1Mtpa of sulphide rich ores. The process route was through
an industry standard CIL processing plant with an additional parallel 1Mtpa sulphide and oxidation circuit.
The finalisation of this study was deferred following the Hemi discovery. The Hemi region is now considered the likely
location for a processing plant at a significantly larger scale than previously planned. Ongoing studies, including metallurgy,
long lead time studies such as environmental, water and infrastructure requirements were commenced and are advancing
during 2020.
The Company anticipates releasing Scoping Study results in 2021 following the maiden Mineral Resource Estimate at Hemi.
Hemi Metallurgy
Initial metallurgical testwork on the Hemi discovery was undertaken during the June 2020 quarter, with excellent initial
gold recoveries achieved from the first Brolga composite samples. Metallurgical recoveries from one of four samples taken
from Brolga was reported in early July 2020 as follows:
• Oxide:
•
Fresh:
93% based on CIL leach; and
96.3% based on sulphide flotation, oxidation and CIL leach
Importantly, the testwork on fresh and transition mineralisation showed that high gold recoveries were achieved by
flotation into a gold-rich concentrate.
Flotation performance was easily achieved at a typical grind size, reagent regime and single flotation cell, producing a
concentrate representing approximately 7% – 8% of the original feed volume. Optimisation of flotation performance will
continue. The flotation concentrate was then delivered to a pressure oxidation circuit and achieved excellent recoveries for
first round, un-optimised testwork.
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De Grey Mining Limited
Pressure oxidation (“POX”) is an industry accepted technology, with the early testwork at Hemi indicating that the scale,
capital and operating costs of a POX circuit should be reasonable as:
•
•
It is processing 7% – 8% of the ore throughput as a result of the flotation circuit;
The gold to sulphur ratio of the concentrate is high, hence less sulphur requires oxidation for the same gold recovery
– as compared to deposits that do not achieve high gold recoveries into a concentrate;
• Oxidation of the gold-rich concentrate during testwork was rapid, which would reduce residence time; and
• Hemi has good access to grid power and gas so power costs are not expected to be substantial.
Further, in considering the overall plant capital cost, Hemi’s proximity to all necessary infrastructure is expected to result
in significantly lower infrastructure costs compared to large scale, remote gold projects recently developed in Western
Australia. This is expected to offset additional capital costs of a flotation plant and small POX circuit.
The initial results are encouraging but not comprehensive as they were only of Hemi ore, with many other ores and ore
grades to be tested. Further other methods of oxidation, such as Biox and Albion, will also be assessed during ongoing
testwork. Some of these oxidation processes do not require pressure or high temperatures.
Figure 5: Simplified testwork flowsheet for fresh ore (note: numbers subject to rounding)
Previous testwork conducted on mineralisation from the regional resources outside Hemi indicates that the Hemi testwork
flowsheet would be suitable to treat those deposits.
The metallurgical testwork program is a long lead time required to further de-risking the project. The recent results remain
to be optimised, however, the testwork demonstrates that at least one industry proven method of processing has been
successful in achieving high gold recoveries.
Regional Deposits and Mineral Resource Upgrade
Drilling completed on deposits within the Project during the second half of calendar 2019 was used to update the Mineral
Resource Estimate for the Project in April 2020. This resulted in an upgrade to 37.44Mt at 1.8g/t Au for 2.2 million ounces
(previously 1.8Moz). The Mineral Resource does not include any drilling from the Hemi discovery or Greater Hemi area
(Table 1). A first Mineral Resource Estimate for Hemi is expected to be completed by the end of FY2021.
The Mineral Resource upgrade was built on updates to the resource models for the Withnell Resource – open pit and
underground, Toweranna open pit and extensions to the Mallina resource.
The resource includes the following categories:
Measured & Indicated (49%)
•
Inferred (51%)
•
Oxide (30%)
•
Free Milling (29%)
•
Sulphide (41%)
•
18.95Mt @ 1.7g/t Au for 1.1Moz
18.49Mt @ 1.9g/t Au for 1.1Moz
13.56Mt @ 1.5g/t Au for 0.64Moz
11.03Mt @ 1.8g/t Au for 0.62Moz
12.83Mt @ 2.2g/t Au for 0.90Moz
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De Grey Mining Limited
The resource increases were achieved across the following ore bodies:
•
•
•
•
Withnell Total (↑ 40%)
Withnell Underground (↑ 9%)
Toweranna (↑ 47%)
Mallina (↑ 91%)
7.49Mt @ 2.5g/t Au for 600,000oz
2.50Mt @ 3.9g/t Au for 317,000oz
7.35Mt @ 2.2g/t Au for 524,000oz
6.76Mt @ 1.4g/t Au for 307,000oz
Table 1: Total Gold Mineral Resource Estimate as at March 2020 (JORC 2012) by Mining Centre
Measured
Indicated
Inferred
Total
Area
Type
Withnell Mining
Centre
Wingina Mining
Centre
TOTAL Pilbara
Gold Project
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Mt
0.98
0.66
1.63
2.68
0.40
3.08
3.66
1.06
4.71
Au g/t
Au Oz
Mt
Au g/t
Au Oz
1.8
1.7
1.8
1.8
1.6
1.7
1.8
1.6
1.7
57,500
34,800
92,300
152,100
20,500
172,700
209,700
55,400
3.49
8.23
11.72
1.84
0.68
2.52
5.33
8.91
265,000
14.24
1.5
1.9
1.8
1.5
1.6
1.5
1.5
1.9
1.7
Mt
2.35
9.87
166,800
496,700
663,500
12.24
87,600
34,900
122,500
254,300
531,700
786,000
2.21
4.04
6.25
4.57
13.90
18.49
Au g/t
Au Oz
Mt
Au g/t
Au Oz
1.4
2.4
2.2
1.1
1.3
1.2
1.2
2.1
1.9
102,300
766,600
870,200
74,900
168,400
243,200
177,200
935,000
1,113,500
6.82
18.75
25.58
6.74
5.12
11.86
13.56
23.87
37.44
1.5
2.2
2.0
1.5
1.4
1.4
1.5
2.0
1.8
326,600
1,298,200
1,626,100
314,500
223,800
538,400
641,200
1,522,000
2,164,500
All gold deposits are reported at a 0.5g/t Au cut-off grade except Wingina below -55mRL where a 1.0g/t Au cut-off was
applied and Withnell below Pit shell 33, where a 2.0g/t Au cut-off was applied. The Leach Pad resource is reported at zero
cut-off grade.
The new resources are based on all drilling completed at each deposit up to the end of 31 December 2019. The open pit
resources are quoted using a 0.5g/t lower cut-off grade and the Withnell and Toweranna underground resources using a
lower cut-off grade of 2g/t. The resources at Mt Berghaus, Wingina, Amanda, Camel, Roe, Dromedary and Calvert remain
unchanged.
Following the Hemi discovery drilling was not continued on any of the regional resources from January 2020. Each deposit
remains open and has potential for further growth. Regional exploration activities will recommence during FY2021.
The value of the existing regional resources, as well as any additional discoveries, are significantly enhanced with a large-
scale central processing facility at Hemi. In addition, the flowsheet that was successfully employed during the initial
metallurgical testwork of Hemi is capable of treating each of the existing regional gold deposits based on metallurgical
testwork done to date.
Safety and Sustainability
De Grey is committed to operating ethically, sustainably, and in accordance with best governance practices. We believe
that responsible management of environment, social and government (ESG) elements will be good for our investors, the
communities with whom we interact, and our staff. Accordingly, we are committed to identifying, assessing and mitigating
ESG risks, and proactively seeking pathways that deliver positive and sustainable outcomes.
In October 2019 the Company undertook a safety and risk review of its operations at the Mallina Gold Project which
identified immediate and longer term action plans. In July 2020 and subsequent to the reporting date, Mr John Brockelsby
was appointed as the Company’s head of Risk and Safety Management. Mr Brockelsby is working with the Managing
Director and other senior staff to build stronger processes and drive positive outcomes across all areas of safety, culture
and social responsibility areas.
Drilling activities were completed during the current financial year with no reportable environmental incidents during the
period. Environmental baseline studies to support a future mining development are underway. The Hemi area has
undergone heritage clearances in the past. More detailed heritage surveys were planned for early 2020 but were postponed
due to COVID-19 restrictions. These surveys are expected to take place in the first quarter of FY2021. Aboriginal negotiations
regarding a Claim Wide Mining Agreement are in progress.
De Grey maintains a strong working relationship with the owners of the Indee and Mallina Stations on which the Project is
located. The Company has also commenced engagement with key groups within Port Hedland and plans to appoint a
manager of Indigenous Relations and Communities in the near future.
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De Grey Mining Limited
Subsequent to the end of the reporting date, the Company put in place a formal ESG policy which outlines our approach
and commitment in these areas.
With respect to our Environmental responsibilities, we will:
•
Strive for continual improvement in our environmental performance by obtaining and following the best available
advice;
• Monitor and measure our environmental performance, and implement measures wherever possible to reduce the
•
impact our operations have on the environment; and
Take all available steps to minimise our impact on the environment and remediate any effects in accordance with best
practice.
When addressing our social responsibilities, we will:
• Respect the rights, interests, customs, culture and values of all those with whom we interact;
•
Proactively engage with impacted communities, and make every endeavour to obtain free, prior and informed consent
for activities that we undertake; and
Seek to demonstrate, in word and deed, a net positive impact resulting from our operations.
•
In addressing our governance responsibilities, we are:
• Guided by the principles set out by respected institutions such as the Australian Securities Exchange, and the
International Council of Mining and Metals;
Committed to meeting the highest standards of ethical business practice; and
Integrating sustainable development in our corporate strategy and decision-making procedures.
•
•
Response to the COVID-19 pandemic
From early 2020, the Company was closely monitoring the onset of the COVID-19 pandemic and made changes to a range of
its operating procedures to ensure the safety of our people and our local communities. Shifts for our site-based team were
extended from March to June in order to reduce risks associated with travel. All site personnel and visitors are tested for
COVID-19 prior to departure and increased hygiene measures remain in place at site and in our Perth office.
These measures have been successful in having no employee or contractor test positive to COVID-19.
Corporate
Capital Raisings and Completion of the Indee Gold Acquisition
Capital raisings completed during FY2020 totalled $53 Million (before costs) and comprised of the following:
•
In July 2019, a placement of 60.3 million shares at $0.05 to raise $3 million. Shares were issued on a cum entitlement
basis and were part of the overall raising at this time of $22.1 million;
In August 2019, a rights issue on a 1 for every 1.28 shares basis at an offer price of $0.05 per share raising $19.1 million,
resulting in the issue of 381 million new shares;
In September 2019, a placement of 2.6 million shares at $0.05 raising $0.13 million;
In December 2019, a placement of 100 million shares (First Tranche) and in March 2020 a placement of 11.1 million
shares (Second Tranche) both at $0.045 per share to raise $5 million; and
In May 2020, the First Tranche placement of 92.2 million shares at $0.28 to raise $25.8 million.
•
•
•
•
A further $5.8 million was raised via the allotment of 30.7 million shares on the exercise of unlisted options at various
exercise prices (between $0.10 and $0.35).
In August 2019, the following non-cash share issues were also completed during the financial year:
• An issue of 59 million shares at a deemed price of ~$0.051 (valued at $3 million) as well as a final cash payment of $9.7
million as final settlement of the Indee Gold Pty Ltd acquisition;
• An issue of 3.8 million shares at a deemed price of $0.065 as part settlement of supplier invoices under agreement with
Topdrill Pty Ltd; and
• An issue of 3.95 million shares on exercise of performance rights to directors and key management personnel.
12
De Grey Mining Limited
As at the date of this report and subsequent to the end of financial year, further shares have been allotted via share
placements and the exercise of unlisted options, raising $94.7 million (before costs) as follows:
•
•
•
In July 2020, the Second Tranche placement of 19.2 million shares at $0.28 per share to raising $5.4 million;
In September 2020, the First tranche placement of 73.1 Million shares at $1.20 per share raising $87.7 million; and
$1.59 million raised via the allotment of 9.3 million shares on the exercise of unlisted options at various exercise prices
(between $0.10 and $0.35)
A Second Tranche of the placement, to raise an additional $12.3M was recently approved by shareholders at a general
meeting held on 23 October 2020 will allow for shares to be placed to major shareholder, DGO Gold Limited and to Non-
executive Director Mr Peter Hood.
Changes to the Board Composition
During July 2019, the Company announced changes to the composition of the De Grey board with the appointments of Mr
Eduard Eshuys and Mr Bruce Parncutt OA, and the resignations of Mr Steve Morris (whom originally commenced in October
2014) and Mr Brett Lambert (whom originally commenced in October 2017). Both Mr Morris and Mr Lambert made
significant contributions to the Company during their board tenure and are thanked for their time and contribution.
On 20 March 2020, the Company announced the appointment of Mr Glenn Jardine as the Company’s Managing Director.
On May 11, 2020, he commenced his role as Managing Director. Glenn is an experienced Mining Executive of 35 years and
was appointed due to his strong background in project management, development and operations. As part of this
restructure at the management level, Mr Simon Lill moved from the role of Executive Chairman to Chairman, with Mr Peter
Hood taking on the role of Lead Independent Director.
Farno McMahon Earn-in
During the financial year, the Company earned an initial 30% interest in E45-2502. De Grey continues to earn into this
tenement with the right to earn up to 75% under a joint venture agreement, with Farno McMahon, a 100% subsidiary of
Novo Resources Corp. It is required to spend further funds prior to the end of the year to earn its 75% and expects to be
drilling on that ground in the near future.
Lag Gravels Agreement
In the prior financial year (June 2019), a Letter of Intent was executed with Novo Resources Corp. granting them the right
to explore across the 100% owned De Grey tenements for gold bearing lag gravels, and to then enter a Joint Venture at
their election, with initial consideration of $1 million, broken into two parts representing the Company’s 100% ownership
at that point. At the time of execution De Grey had not yet concluded the acquisition of Indee Gold Pty Ltd. This occurred
in August 2019 when the final $300,000 was received on completion of the Indee Gold acquisition.
Competent Person
The information in this report that relates to exploration results is based on, and fairly represents information and supporting
documentation prepared by Mr. Andrew Beckwith, a Competent Person who is a member of The Australasian Institute of
Mining and Metallurgy. Mr. Beckwith is a consultant to De Grey Mining Limited. Mr. Beckwith has sufficient experience that
is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to
qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results,
Mineral Resource and Ore Reserves”. Mr. Beckwith consents to the inclusion in this report of the matters based on his
information in the form and context in which it appears.
The Information in this report that relates to Mineral Resources is based on information compiled by Mr Paul Payne, a
Competent Person who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Payne is a full-time employee
of Payne Geological Services. Mr Payne has sufficient experience that is relevant to the style of mineralisation and type of
deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012
Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Payne
consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
13
Directors’ Report
Your directors present their report on the consolidated entity comprising De Grey Mining Limited (“De Grey” or “the
Company”) and its controlled entities (“the consolidated entity” or “Group”) for the financial year ended 30 June 2020.
De Grey Mining Limited
All amounts are expressed in Australian dollars unless otherwise stated.
De Grey is a company limited by shares that is incorporated and domiciled in Australia.
Directors
The following persons were Directors of the Company during the whole of the financial year and up to the date of this report,
except as otherwise indicated:
Simon Lill
Glenn Jardine (appointed 11 May 2020)
Andrew Beckwith
Peter Hood
Eduard Eshuys (appointed 23 July 2019)
Bruce Parncutt (appointed 23 July 2019)
Steven Morris (resigned 22 July 2019)
Brett Lambert (resigned 22 July 2019)
Information on Directors
Simon Lill, BSc MBA
Executive Chairman
Mr Lill was appointed to the board in October 2013 and became Executive Chairman in 2014. He has previously worked with
Anaconda Nickel Limited through engineering studies, financing and construction phases of the Murrin Murrin Nickel mine.
He also has extensive experience since the 1980’s with ASX listed companies, spanning small cap companies to larger
concerns, involving restructuring, corporate, compliance, marketing, company secretarial and management activities,
resulting in his role at De Grey Mining Ltd.
During the past three years Mr Lill has also served as a Director of the following listed companies:
Date appointed
18 May 2011
2 September 2013
29 March 2018
Company
Finexia Financial Group Limited (formerly Mejority Capital Limited)
Purifloh Limited
XPD Soccer Gear Group Limited
Date ceased
25 November 2019
-
-
Interest in shares and options:
13,739,063 ordinary fully paid shares
130,566 options over ordinary shares in De Grey Mining Limited
500,000 performance rights
Glenn Jardine, BE (Mining) FAusIMM
Managing Director
Mr Jardine was appointed in May 2020. He is an experienced mining executive of 35 years with direct experience in growing
resource companies from early stage exploration through to multi-operation entities, and including taking projects through
feasibility studies, equity funding, debt financing, project development and operations. His experience includes Project
Manager & General Manager of the Henty Gold Mine in Tasmania for Goldfields Ltd; Project Manager of the Emily Ann &
Maggie Hays nickel mines; General Manager New Business, Chief Operating Officer & Managing Director for Lion Ore
Australia. He has more recently been Chief Operating Officer of Azure Minerals Limited. Commodity experience includes
precious metals, base metals and bulk commodities across underground and open pit operations. Processing methods
utilised at these projects and operations include CIP/CIL, DMS, sulphide flotation, BIOX, pressure oxidation and SX/EW.
14
Projects developed have received Australian State and Federal recognition for environmental best practice and health and
safety and human resources systems.
During the past three years Mr Jardine has not served as a Director of any other listed companies.
De Grey Mining Limited
Interest in shares and options:
140,846 performance rights
Andrew Beckwith, BSc Geology, Aus IMM
Technical Director & Operations Manager
Mr Beckwith was appointed to the board in October 2017, having commenced his time with De Grey as a Technical
Consultant in February 2016.
He is a successful and experienced exploration geologist who has previously held senior technical roles with AngloGold
Ashanti, Acacia Resources, Helix Resources, Normandy NFM, North Flinders Mines, BP Minerals Australia, and Westgold
Resources. At Westgold, Mr Beckwith initially held the role of exploration manager before appointment as Managing
Director. Additionally, Mr Beckwith was an Executive director of Bulletin Resources Limited until June 2014.
During his time at Westgold, he was intimately involved in the Explorer 108 Pb-Zn-Ag and the Au-Cu Rover 1 (1.2Moz)
discoveries in the Northern Territory as well as the acquisition of the Central Murchison Gold Project located in Western
Australia.
During the past three years Mr Beckwith has also served as a Director of the following listed companies:
Company
Carnavale Resources Limited
Date appointed
29 July 2014
Date ceased
-
Interest in shares and options:
7,031,668 ordinary fully paid shares
1,163,207 options over ordinary shares in De Grey Mining Limited
400,000 performance rights
Peter Hood AO, BE(Chem), MAusIMM, FlChemE, FAICD
Non-executive Director & Lead Independent Director
Mr Hood was appointed to the board on 19 November 2018. Mr Hood, a Chemical Engineer, has had a distinguished career
in the Australian Mining and Chemical Industries. He held the position of Senior Production Engineer at the Kwinana Nickel
Refinery from 1971 to 1981, then Mill Superintendent of the WMC Kambalda Nickel and Gold Operations between 1982 to
1985. In 1985, he joined Coogee Chemicals Pty Ltd in the position of General Manager and then as their CEO between 1998
and 2005. He then held the position of CEO of Coogee Resources Ltd before retiring in 2008. Through that period he was part
of the management team that oversaw significant growth in Coogee Chemicals.
In 2020, Mr Hood was recognised as Officer in the Order of Australia in the Australia Day Honours List for distinguished
service to business and commerce at the state, national and international level, and to the resources sector.
During the past three years Mr Hood has also served as a Director of the following listed companies:
Company
Cue Energy Resources Limited
GR Engineering Limited
Matrix Composites and Engineering Limited
Date appointed
23 February 2018
10 February 2011
15 September 2011
Date ceased
-
-
-
Interest in shares and options:
4,000,000 ordinary fully paid shares
52,227 options over ordinary shares in De Grey Mining Limited
Committees
Audit & Risk Committee (appointed 29 August 2019)
Remuneration & Nomination Committee (appointed 29 August 2019)
15
De Grey Mining Limited
Eduard Eshuys, BSc, FAusIMM, FAICD
Non-executive Director
Mr Eshuys was appointed to the board on 23 July 2019. Mr Eshuys is a highly experienced and well credentialled geologist
with over 40 years exploration and company management experience in Australia. In the late 1980s and early 1990s he led
the teams that discovered the Plutonic, Bronzewing and Jundee gold deposits, and the Cawse Nickel Deposit. He has also
had involvement in the Maggie Hays and Mariners nickel discoveries in the 1970’s. He was the Managing Director and CEO
of St Barbara Limited from July 2004 to March 2009. During this time St Barbara Limited grew substantially as a gold producer.
During the past three years Mr Eshuys has also served as a Director of the following listed companies:
Company
DGO Gold Limited*
NTM Gold Limited
Date appointed
15 July 2010
26 March 2019
Date ceased
-
-
As at the date of this report, DGO Gold Ltd holds 193,577,703 ordinary fully shares in De Grey Mining Limited (representing 15.13%).
Interest in shares and options:
Nil ordinary fully paid shares
52,227 options over ordinary shares in De Grey Mining Limited
Committees
Remuneration & Nomination Committee (Chairman, appointed 29 August 2019)
Audit & Risk Committee (appointed 29 August 2019)
Bruce Parncutt AO, BSc, MBA
Non-executive Director
Mr Parncutt was appointed to the board on 23 July 2019. Mr Parncutt is currently Chairman of investment banking group
Lion Capital and has had a career spanning over 40 years in investment management, investment banking and stock broking,
where he has previously held roles as Managing Director of McIntosh Securities, Senior Vice President of Merrill Lynch,
Director of Australian Stock Exchange Ltd.
In 2016, Mr Parncutt was recognised as Officer in the Order of Australia in the Queen’s Birthday Honours List for distinguished
service to the community as a philanthropist (particularly in arts and education) and as an advocate and supporter of
charitable causes, and to business and commerce. He is currently a member of The Australian Ballet Board and a Trustee of
the Helen MacPherson Smith Trust.
During the past three years Mr Bruce Parncutt has also served as a director of the following listed companies:
Company
DGO Gold Limited
Date appointed
23 May 2018
Date ceased
-
As at the date of this report, DGO Gold Ltd holds 193,577,703 ordinary fully shares in De Grey Mining Limited (representing 15.13%).
Interest in shares and options:
Nil ordinary fully paid shares
52,227 options over ordinary shares in De Grey Mining Limited
Committees
Audit & Risk Committee (Chairman, appointed 29 August 2019)
Remuneration & Nomination Committee (appointed 29 August 2019)
16
De Grey Mining Limited
Steven Morris, Dip Fin Mkts
Non-executive Director
Mr Morris resigned from the board on 22 July 2019.
Committees
Remuneration & Nomination Committee (appointed 26 July 2018, resigned 22 July 2019)
Brett Lambert, B.AppSc (Mining Engineering), MAICD
Non-executive Director
Mr Lambert resigned from the board on 22 July 2019.
Committees
Remuneration & Nomination Committee (Chairman, appointed 26 July 2018, resigned 22 July 2019)
Company Secretaries
The following persons acted as Company Secretary of the Company during the whole of the financial year and up to the date
of this report:
Craig Nelmes, BBus
Mr Nelmes is an Accountant who joined De Grey in October 2013 and has over 25 years experience in finance, secretarial,
governance, financial systems and accounting services to the mining sector in Australia and overseas. His experiences include
over seven years with International Accounting firm Deloitte, nine years with a multi-national resource’s entity and most
recently ten years with Corporate Consultants Pty Ltd, a Company providing accounting, secretarial and administrative
services to ASX and TSX listed entities.
Patrick Holywell, FGIA GradDipCA GAICD BCom
Patrick Holywell is a Chartered Accountant who joined De Grey in July 2018. He has over 15 years of experience in corporate
governance, finance and accounting including employment with Deloitte and Patersons Securities Ltd. Mr Holywell has been
employed by and acted as company secretary, CFO and/or director of a number of companies in various sectors.
Principal Activities
The principal activity of the consolidated entity during the course of the year was exploration and development activities at
the Mallina Gold Project (“MGP”) , 80 kms south west of Port Hedland in the Pilbara region of Western Australia. De Grey
currently controls a considerable tenement package comprising over 1,500km2. The tenement package is highly prospective
for gold, other precious metals and also comprises significant base metals resources (Zn-Ag-Pb) as well as lithium prospects.
In August 2019, the settlement of the Indee Gold Pty Ltd acquisition consolidated De Grey’s ownership of the MGP. Over the
last four (4) years the MGP resource base has grown six (6) fold from 346koz @ 1.6g/t Au in February 2016 to 2.2Moz @
1.8g/t Au as at April 2020. During the current financial year, a new style of intrusion-related gold mineralisation was
discovered and an initial seven new targets identified for testing. The first of these to be tested was the Hemi gold prospect,
which has since delivered impressive exploration results and confirmed gold mineralisation across numerous defined zones.
Exploration activity is now accelerating with the objective of delivering significant resource growth.
17
De Grey Mining Limited
Financial Review
The consolidated loss after tax for the year ended 30 June 2020 was $3,976,002 (2019: $2,009,130).
Earnings per share
The basic loss per share for the year ended 30 June 2020 was 0.41 cents per share (2019: 0.50 cents per share).
Dividends
No dividends were paid or declared during the financial year. No recommendation for payment of dividends has been made.
Significant changes in state of affairs
There were no significant changes in the nature of the activities of the Group during the period, other than those included
in the Key Highlights within the Review of Operations.
Matters subsequent to the end of the financial year
There has been no matters or circumstances occurring subsequent to the end of the financial year that has significantly
affected, or may significantly affect the operations of the Group, the result of those operations, or the state of affairs of the
Group in future financial years, other than:
• On 14 July 2020, the Company completed a placement of 19.2 Million shares at a price of $0.28 per share to raise $5.4
Million (before costs of raising). This represented the 2nd tranche of the placement announced on 28 April 2020 after
shareholder approval was received at a General Meeting held on 10 July 2020, for related parties DGO Gold Limited
(12.2 Million New Shares) and Mr. Peter Hood (1 Million New Shares) to participate.
• On 29 July 2020, the Company completed an allotment of 450,454 unlisted option, zero priced exercise and expiring 29
July 2022 (“ZEPO’s”). These were issued to directors Mr. Andrew Beckwith (163,207 ZEPO’s), Mr. Simon Lill (130,566
ZEPO’s) and Messrs Eduard Eshuys, Peter Hood and Bruce Parncutt (52,227 ZEPO’s each), after shareholder approval
was received at a General Meeting held on 10 July 2020,
• On 18 September 2020, the Company completed a placement of 73.1 Million shares to sophisticated, professional and
institutional investors including clients of Argonaut Securities Pty Limited, Canaccord (Genuity) Limited and Bell Potter
Securities Pty Ltd at a price of $1.20 per share to raise $87.72 Million (before costs of raising). This represented the 1st
tranche of the placement announced on 14 September 2020, with the 2nd tranche of 10.3 Million shares to raise a further
$12.36 Million subject to shareholder approval of related party participation by DGO Gold Limited (12 Million New
Shares) and Mr. Peter Hood (300,000 New Shares).
• On 18 September 2020, an allotment was made of 140,846 Performance rights (“rights”) to Mr. Glenn Jardine after
shareholder approval was received at a General Meeting held on 10 July 2020, and he had completed his employment
probation period. The rights represent the long-term incentive component of Mr. Jardine’s remuneration with respect
to his first year of employment.
•
Since the reporting date, a total of 9,637,047 unlisted options have been exercised, at various exercised prices
between $0.10 and $0.35, raising a total of $1,588,621.
18
De Grey Mining Limited
Likely developments and expected results
De Grey seeks to maximise shareholder value through its ongoing exploration and development work at The Mallina Gold
Project (“MGP”). The Project consists of 100% owned tenements as well as tenements the subject of a farm in agreement.
The Company expects to continue its drilling program at the recent Hemi Gold Discovery which currently comprises five key
zones, Aquila, Brolga, Brolga South, Crow and Falcon. Hemi is a mineralised intrusion that had never previously been drilled.
The Company has identified a further four intrusions in the Hemi corridor, of which three are known to contain mineralisation
(Antwerp, Scooby, Shaggy), as well as a further two to the west of the Project tenements, being Charity Well and Geemas.
These are additional to Toweranna, which is also a mineralised intrusion.
Additionally, De Grey has identified greater than 20 new magnetic features that may be additional intrusion targets.
The Company will:
•
•
Continue to drill at Hemi and within its corridor to discover the extents of the mineralisation whilst also infilling
the discovery to provide a resource by the middle of 2021;
Explore the other known mineralised targets through aircore drilling initially, and followed up by RC and diamond
drilling where warranted;
• Ongoing identification of possible new intrusion targets through a combination of geophysics, geochemistry and
aircore drilling; and
• Regional drilling along existing shear zone structures.
The Company has an aspirational goal of achieving a Tier 1 scale of mineralisation within the MGP.
19
De Grey Mining Limited
Remuneration Report (Audited)
The remuneration report is set out under the following headings:
A. Key Management Personnel
B. Remuneration policy
C. Service agreements
D. Details of Remuneration
E. Securities Based Compensation
F. Other Transactions and Balances with Key Management Personnel
The information provided in this remuneration report has been audited as required by section 308(3C) of the Corporations
Act 2001.
A. Key management personnel
Names and positions held by the Company’s key management personnel (“Key Management Personnel”) in office at any
time during the financial year and up to the date of this annual report are:
Key Management Personnel
Mr Simon Lill
Mr Glenn Jardine
Mr Andrew Beckwith
Mr Peter Hood AO
Mr Eduard Eshuys
Mr Bruce Parncutt AO
Mr Steven Morris
Mr Brett Lambert
Mr Craig Nelmes
Mr Patrick Holywell
Position
Chairman (formerly Executive Chairman until 11 May 2020)
Managing Director (appointed 11 May 2020)
Technical Director & Operations Manager
Non-Executive Director
Non-Executive Director (appointed 23 July 2019)
Non-Executive Director (appointed 23 July 2019)
Non-Executive Director (resigned 22 July 2019)
Non-Executive Director (resigned 22 July 2019)
Company Secretary & CFO
Company Secretary
Except as noted, the named persons held their current position for the whole of the financial year and/or at the date of this
report.
B. Remuneration policy
The remuneration policy of De Grey Mining Limited has been designed by the board taking into consideration the stage of
development of the Group and the activities undertaken. The guidance is to align key management personnel objectives with
shareholder and business objectives by providing a fixed remuneration component or fee for service (where that is
applicable) and offering specific long-term incentives based on key performance areas affecting the Group’s financial results
or operational milestones. The board of De Grey Mining 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 Group.
From time to time when reviewing remuneration, the Company may also source external advice to assist with salary setting
and determination of other benefits, including short term and long-term incentive plans.
The remuneration policy has been tailored to increase the direct positive relationship between shareholders’ investment
objectives and director and key management personnel performance. Currently, this is facilitated through the issue of
options and/or performance rights to the majority of key management personnel to encourage the alignment of personal
and shareholder interests. The company believes this policy will be effective in increasing shareholder wealth.
20
De Grey Mining Limited
Executive remuneration
The objective of the Group’s executive reward framework is to ensure reward for performance is competitive and
appropriate for the results delivered. The framework has the following components:
• Base salary (which is based on factors such as length of service, performance and experience) and (where applicable)
employer contributions to superannuation;
• Consulting fees for executives providing services under a services contract;
•
•
Short-term performance incentives taking into consideration executive and/or Company performance indicators that
the Company may set from time and other matters that it deems appropriate; and
Long-term incentives through participation in the Performance Rights (“PRP”) and/or Employee Option (“EOP”) Plans of
De Grey Mining Limited and as approved by the Board.
Non-executive Directors’ remuneration
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.
Fees for non-executive directors are not linked to the performance of the Group. However, to align Directors’ interests with
shareholder interests, the non-executive directors may receive short term performance incentives and longer-term
performance incentives as approved by shareholders.
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 and is currently $700,000.
The annual remuneration for each non-executive director was set in the range of $36,000 - $48,000 per annum for the 2019-
2020 financial year. These fees have been determined by the Board of the Company, taking into consideration factors such
as the market rates of industry peer companies and the current level of activity. Where there is a significant change in the
size and scale of Company activities these annual fees will be reviewed. Where approved and at the request of the board,
any of the Non-Executive Directors may from time to time be required to fulfil certain executive functions.
Use of remuneration consultants
The Board from time to time engages the services of external consultants to advise on the remuneration policy and to
benchmark director and key management personnel remuneration against comparable entities so as to ensure that
remuneration packages are consistent with the market and are appropriate for the organisation. The Group employed the
services of a remuneration consultant during the financial year ended 30 June 2020.
21
De Grey Mining Limited
Performance Rights (PRP) and Employee Option Plans (EOP) of De Grey Mining Limited
The PRP and EOP were last approved by Shareholders at the 2017 and 2018 Annual General Meetings respectively.
All Directors, full and part time employees, as well as key consultants of De Grey Mining Limited are eligible to participate in
each Plan. Any issue of Rights or Options to Directors under either Plan will be subject to Shareholder approval pursuant to
the provisions of the ASX Listing Rules and the Corporations Act 2001. The Directors consider that collectively the PRP and
EOP represent an appropriate method to:
• Reward Directors, Key management personnel and employees for their past performance;
•
•
•
•
•
Provide long term incentives for participation in the Company’s future growth;
To motivate and retain Directors, KMP and senior employees;
Establish a sense of ownership in the Company for the Directors and employees;
Enhance the relationship between the Company and its employees for the long-term mutual benefit of all parties; and
Enable the Company to attract high calibre individuals who can bring specific expertise to the Company.
Voting on the Remuneration Report - 2019 Annual General Meeting
The Company received approximately 98.3% of “yes” votes on its remuneration report for the current financial year (2018:
99.6%).
C. Executive service agreements
Remuneration and other terms of employment for the executive directors and other KMP are formalised in employment or
service agreements. The major provisions of the agreements relating to remuneration for the year ended 30 June 2020 are
set out in the table below:
Name
Agreement
Simon Lill¹
Glenn Jardine²
Andrew Beckwith
Craig Nelmes
Patrick Holywell
Service
Employment
Employment
Service (100%)
Service
Base Salary
/Fees (p.a.)
$156,000
$362,500
$250,000
$226,008
-
STIP/LTIP
-
$150,000
-
-
-
Consulting/Hr
Duration
Notice Period
Termination
-
-
-
-
$120
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
3 months
3 months
3 months
3 months
1 month
6 months
6 months
6 months
6 months
1 month
¹Mr. Lill moved from the role of Executive Chairman to Chairman, as announced on 11 May 2020, to coincide with the appointment of
Managing Director – Glen Jardine.
²Mr. Jardine commenced employment on 4 May 2020 and appointed to the board as Managing Director on 11 May 2020. The salary
package includes Short-term incentive plan “STIP” ($50,000) and Long-Term incentive plan “LTIP” ($100,000) on the basis of key
performance indicators agreed with the board.
³Mr. Nelmes Executive Service arrangements were 75% of his time devoted to the Company and moved to 100% from 1 Feb 2020.
22
D. Details of Remuneration
Details of the remuneration of the directors, the key management personnel of the Group (as defined in AASB 124 Related
Party Disclosures) and specified executives of De Grey Mining Limited and the Group are set out in the following tables. The
key management personnel of the Group are the Directors of De Grey Mining Limited and the Company Secretaries.
De Grey Mining Limited
Short-term
Post-
employment
Share based payments
Total
Salary or
Consulting
Fees
$
Bonus⁷
$
Other
$
Superannuation
Options
Performance
rights
$
$
$
$
%
% of
remuneration
performance-
based
Directors
Simon Lill
2020
2019
Glenn Jardine2
2020
Andrew
Beckwith
156,000
156,000
10,000
25,000
100,000¹
-
-
-
-
42,600
32,414
118,627
298,414
342,227
55,175
-
5,242
-
-
60,417
-
-
-
-
-
-
-
-
-
-
2020
2019
228,324
223,933
10,000
25,000
Peter Hood³
2020
2019
Bruce Parncutt⁴
2020
Eduard Eshuys⁴
2020
Steven Morris⁵
2020
2019
Brett Lambert⁵
2020
2019
Sub-total
Directors
43,836
27,397
41,096
41,096
3,000
36,000
3,653
42,922
-
-
-
-
-
-
-
-
22,641
21,274
4,164
2,603
3,904
10,000⁴
3,904
9,000⁵
-
12,000⁵
-
-
-
347
4,078
-
42,600
55,238
164,817
316,203
477,624
-
-
-
-
-
10,650
-
10,650
-
-
-
-
20,714
61,806
13,809
41,204
48,000
30,000
45,000
55,000
32,714
108,456
29,809
98,854
2020
2019
572,180
486,252
20,000
50,000
131,000
-
40,202
27,955
-
106,500
122,176
386,454
885,557
1,057,161
Other Key management personnel
Craig Nelmes⁶
2020
2019
200,505
169,698
10,000
-
Patrick
Holywell4
2020
2019
90,520
60,690
Total key management personnel compensation
863,205
716,640
32,000
50,000
2,000
-
2020
2019
131,000
-
-
-
-
-
40,202
27,955
36,480
10,650
19,448
71,176
266,433
251,522
18,240
4,260
54,720
121,410
-
-
110,760
64,950
141,624
457,630
1,262,750
1,373,633
11%
54%
0%
17%
49%
0%
0%
0%
0%
63%
67%
46%
52%
21%
33%
16%
7%
¹Mr. Lill received the payment in lieu of termination of his Executive Services agreement on 30 June 2020.
²Mr Jardine commenced employment on 4 May 2020, and appoint to the board on 11 May 2020.
³Mr Hood was appointed 16 November 2018.
⁴Mr. Parncutt and Mr Eshuys were appointed 23 July 2019. Mr. Eshuys received an additional fee for assistance with the August 2019 capital raising.
⁵Mr Lambert and Mr Morris resigned 22 July 2019, and received a payment in lieu of notice.
⁶Mr Nelmes service agreement was entered into from 1 May 2018 on basis of 75% and 100% from 1 Feb 2020.
⁷In December 2019, the board approved each discretionary cash bonus on the basis of past performance and as recommended by the Remuneration
Committee.
23
Shareholdings of Key Management Personnel
De Grey Mining Limited
Opening Balance
1 July 2019
No.
6,983,333
-
6,091,668
1,000,000
-
-
2,333,334
-
3,641,316
-
20,049,651
Directors
Simon Lill
Glenn Jardine1
Andrew
Beckwith
Peter Hood
Bruce Parncutt2
Eduard Eshuys2
Steven Morris³
Brett Lambert³
Other
executives
Craig Nelmes
Patrick Holywell
Total
Received on exercise
of rights &/or
options
No.
800,000
-
Purchases
(disposals)
during the year
Other changes
Closing Balance
during the year
30 June 2020
No.
No.
No.
5,455,730
-
1,200,000
340,000
-
-
-
-
-
2,000,000
-
-
-
-
-
-
-
-
-
-
(2,333,334)3
-3
500,000
-
556,937
150,000
-
-
2,500,000
8,502,667
(2,333,334)
13,239,063
-
7,631,668
3,000,000
-
-
-
-
4,698,253
150,000
28,718,984
1Mr Jardine was appointed 11 May 2020.
2Mr Parncutt and Mr Eshuys were appointed 23 July 2019.
³Mr Morris and Mr Lambert both resigned as directors on 22 July 2019.
4Performance rights which vested 22 August 2019 with no consideration payable.
24
Option-holdings of Key Management Personnel
Opening Balance
1 July 2019
Options acquired as
compensation
Purchases (disposals)
during the year
Exercised/other
changes during the
year
Closing Balance
30 June 2020⁴
No.
No.
No.
No.
No.
De Grey Mining Limited
Directors
Simon Lill
Glenn
Jardine1
Andrew
Beckwith
Peter Hood
Bruce
Parncutt2
Eduard
Eshuys2
Steven
Morris³
Brett
Lambert³
Other
executives
Craig
Nelmes
Patrick
Holywell
1,000,000
-
2,000,000
-
-
-
250,000
250,000
750,000
100,000
-
-
-
-
-
-
-
-
600,000
300,000
Total
4,350,000
1Mr Jardine was appointed 11 May 2020.
2Mr Parncutt and Mr Eshuys were appointed 23 July 2019.
³Mr Morris and Mr Lambert both resigned as directors on 22 July 2019.
⁴All remaining options were fully vested and exercisable as at 30 June 2020.
900,000
-
-
-
-
-
-
-
-
-
50,000
50,000
-
-
-
-
-
-
(250,000)3
(250,000)3
-
-
(500,000)
1,000,000
-
2,000,000
-
-
-
-
-
1,350,000
450,000
4,800,000
Performance rights of Key Management Personnel
Opening
Balance
1 July 2019
No.
1,500,000
-
2,000,000
-
-
-
750,000
500,000
900,000
-
5,650,000
Directors
Simon Lill
Glenn Jardine1
Andrew Beckwith
Peter Hood
Bruce Parncutt2
Eduard Eshuys2
Steven Morris3
Brett Lambert3
Other executives
Craig Nelmes
Patrick Holywell
Total
1Mr Jardine was appointed 11 May 2020.
2Mr Parncutt and Mr Eshuys were appointed 23 July 2019.
³Mr Morris and Mr Lambert both resigned as directors on 22 July 2019.
⁴All remaining performance rights as at 30 June 2020 were unvested.
Rights acquired
as
compensation
Rights exercised
Other changes
Closing Balance
during the year
during the year
30 June 2020⁴
No.
No.
No.
No.
(800,000)
-
(1,200,000)
-
-
-
-
-
(500,000)
-
(2,500,000)
(200,000)
-
(400,000)
-
-
-
(750,000)3
(500,000)3
(100,000)
-
500,000
-
400,000
-
-
-
-
-
300,000
-
(1,950,000)
1,200,000
-
-
-
-
-
-
-
-
-
-
-
25
De Grey Mining Limited
E. Securities based compensation - options
The Company granted 900,000 (2019: 2,850,000) options over unissued ordinary shares during the financial year to Directors
and other key management personnel as part of their remuneration, as detailed in the table below:
Grant
Date
Expiry
Date
Exercise
Price
(cents)
Value per
option at
grant date
(cents)
Granted
Number
Exercised
Number
Vesting Date
Number
Vested at end
of year
2020
Craig Nelmes
12 March 2020
12 March 2022
Patrick Holywell
12 March 2020
12 March 2022
2019
Simon Lill
Andrew
Beckwith
Steve Morris
Brett Lambert
Craig Nelmes
Pat Holywell
17 Oct 2018
31 May 2021
17 Oct 2018
31 May 2021
17 Oct 2018
31 May 2021
17 Oct 2018
31 May 2021
17 Oct 2018
31 May 2021
17 Oct 2018
31 May 2021
35.0
35.0
30.0
30.0
30.0
30.0
30.0
30.0
6.08
6.08
4.26
4.26
4.26
4.26
4.26
4.26
600,000
300,000
1,000,000
1,000,000
250,000
250,000
250,000
100,000
-
-
-
-
-
-
-
-
12 March 2020
12 March 2020
600,000
300,000
17 Oct 2018
1,000,000
17 Oct 2018
1,000,000
17 Oct 2018
17 Oct 2018
17 Oct 2018
17 Oct 2018
250,000
250,000
250,000
100,000
Options granted to Key management personnel under the shareholder approved Employee Option plans as compensation
for their past performance. There are no performance related conditions attached to any of these issued options and they
were all issued for nil consideration.
F. Securities based compensation – performance rights
There were no performance rights granted to directors and key management personnel as part of compensation during the
year ended 30 June 2020 (30 June 2019: nil).
G. Other transactions and balances with Key Management Personnel
There were no other transactions and balances with key management personnel.
----------- End of Audited Remuneration Report -----------
26
De Grey Mining Limited
Directors’ and Committee Meetings
The number of meetings of the Company’s Board of Directors and its committees held in the 12 months to 30 June 2020 and
the number of meetings attended by each Director are as per the following table:
Directors Meetings
Audit & Risk
Committee1
Remuneration & Nomination
Committee2
Eligible
Attended
Eligible
Attended
Eligible
Attended
Simon Lill
Glenn Jardine3
Andrew Beckwith
Peter Hood1,2
Eduard Eshuys1,2
Bruce Parncutt1,2
Steven Morris1,2
Brett Lambert1,2
14
3
14
14
14
14
-
-
14
3
14
14
14
14
-
-
n/-a
n/-a
n/-a
1
1
1
-
-
-n/a
-n/a
-n/a
-
1
-
-
-
-n/a
-n/a
-n/a
1
1
1
-
-
-n/a
-n/a
-n/a
1
1
1
-
-
1On 22 July 2019, both Mr Lambert and Mr Morris resigned. On 29 August 2019, the full board of Company appointed Mr Peter Hood, Mr
Eshuys and Mr Parncutt to the Audit & Risk Committee, with Mr Parncutt as its Chairman.
2On 22 July 2019, both Mr Lambert and Mr Morris resigned. On 29 August 2019, the full board of Company appointed Mr Peter Hood, Mr
Eshuys and Mr Parncutt to the Remuneration & Nomination Committee, with Mr Eshuys as its Chairman.
3Mr Jardine was appointed on 11 May 2020.
Share Options and Performance rights
At the date of this report there are 10,757,454 unissued ordinary shares in respect of which options are outstanding and
1,450,000 performance rights outstanding.
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Unlisted options
Performance rights
Number
750,000
3,050,000
2,000,000
4,507,000
450,454
1,450,000
Exercise Price
10 cents
30 cents
10 cents
35 cents
Nil cents
N/A
Expiry Date
31 October 2020
30 May 2021
13 December 2021
12 March 2022
29 July 2022
30 November 2022
During the financial year 19,000,000 options were issued, 30,655,953 options were exercised and 45,833,333 options
expired. No performance rights were issued, 3,950,000 were exercised and 1,300,000 expired. Since the end of the financial
year, a further 450,454 options have been issued and 9,537,047 options have been exercised.
No person entitled to exercise options and/or performance rights had or has any right by virtue of the option to participate
in any share issue of the company or a right to vote at a shareholder meeting.
Environmental Regulation
The Group is subject to environmental regulation in respect to its exploration activities. The Group aims to ensure the
appropriate standard of environmental care is achieved, and in doing so, that it is aware of and is in compliance with all
environmental legislation. The directors of the Group are not aware of any breach of environmental legislation for the year
under review.
Risk Management
The board is responsible for ensuring that risks, and also opportunities, are identified on a timely basis and that activities are
aligned with the risks and opportunities identified by the board. Given the size and scale of its current operations, the board
and key management personnel as a group periodically assess risks and develop strategies to mitigate the impact of any
perceived risks. The board endeavours to identify potential risks when carrying out strategy planning and budgeting tasks
and assessment and monitoring through its board meetings.
27
De Grey Mining Limited
Insurance of Directors and Officers
During the financial year, De Grey Mining Limited paid a premium to insure the directors and secretary of the Company. The
total amount of insurance contract premiums paid is confidential under the terms of the insurance policy.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought
against the officers in their capacity as officers of the Company, and any other payments arising from liabilities incurred by
the officers in connection with such proceedings. This does not include such liabilities that arise from conduct involving a
wilful breach of duty by the officers or the improper use by the officers of their position or of information to gain advantage
for themselves or someone else or to cause detriment to the company. It is not possible to apportion the premium between
amounts relating to the insurance against legal costs and those relating to other liabilities.
Non-Audit Services
The following non-audit services were provided by the Group’s auditor, Butler Settineri (Audit) Pty Ltd, or associated entities
(refer note 24). The directors are satisfied that the provision of non-audit services is compatible with the general standard
of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the provision of non-
audit services by the auditor, as set out below, did not compromise the auditor independence requirements of the
Corporations Act 2001 for the following reasons:
• All non-audit services have been reviewed by the board to ensure they do not impact the impartiality and objectivity of
the auditor; and
• None of the services undermine the general standard of independence for auditors.
Butler Settineri received or are due to receive the following amounts for the provision of non-audit services:
Tax compliance services
Proceedings on behalf of the company
2020
$
3,675
2019
$
2,800
As at the date of this report there are no leave applications or proceedings booked on behalf of De Grey Mining Limited
under section 237 of the Corporations Act 2001.
Auditor’s Independence Declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out on
page 18.
This report is made in accordance with a resolution of the Directors
Simon Lill
Chairman
Perth, 30 September 2020
Bruce Parncutt
Chairman of the Audit & Risk Committee
28
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of De Grey Mining Limited for the year ended 30
June 2020, I declare that, to the best of my knowledge and belief, there have
been:
a) No contraventions of the auditor independence requirements of the
Corporations Act 2001 in relation to the audit; and
b) No contraventions of any applicable code of professional conduct in relation
to the audit.
The declaration is in respect of De Grey Mining Limited and the entities it controlled
during the year.
BUTLER SETTINERI (AUDIT) PTY LTD
LUCY P GARDNER
Director
Perth
Date: 30 September 2020
Consolidated Statement of Comprehensive Income
FOR THE YEAR ENDED 30 JUNE 2020
Notes
Consolidated
2020
$
2019
$
REVENUE & OTHER INCOME
5
366,029
1,253,929
De Grey Mining Limited
EXPENDITURE
Exploration expenditure – written off
Depreciation expense
Director & employee expenses
Share based payments (directors & employees)
Corporate and compliance expenses
Consulting expenses
Corporate advisory
Share based payments – corporate advisory
Investor relations & promotional expenses
Occupancy expenses
Finance costs
Administration and other expenses
LOSS BEFORE INCOME TAX
INCOME TAX BENEFIT / (EXPENSE)
LOSS FOR THE YEAR
OTHER COMPREHENSIVE INCOME
Items that may be reclassified to profit or loss
Other comprehensive income for the year, net of tax
6/33
6
7
(27,571)
(336,823)
(1,449,448)
(514,489)
(492,538)
(89,479)
(566,858)
(136,251)
(482,464)
(48,527)
(14,204)
(183,379)
-
(182,117)
(1,068,499)
(751,744)
(315,451)
(48,667)
(133,501)
-
(516,929)
(105,735)
-
(140,416)
(3,976,002)
(2,009,130)
-
-
(3,976,002)
(2,009,130)
-
-
TOTAL COMPREHENSIVE LOSS FOR THE YEAR ATTRIBUTABLE TO EQUITY
HOLDERS OF DE GREY MINING LIMITED
(3,976,002)
(2,009,130)
Basic and diluted loss per share for loss attributable to the ordinary equity
holders of the company (cents per share)
32
(0.41)
(0.50)
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the Notes to the
Consolidated Financial Statements.
30
Consolidated Statement of Financial Position
AT 30 JUNE 2020
Notes
Consolidated
De Grey Mining Limited
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Inventories
Other assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Financial assets
Deferred exploration & evaluation expenditure
Property, plant and equipment
Right of use asset – office premises
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Operating lease liabilities – office premises
Employee benefit obligations
Contract liabilities
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Operating lease liabilities – office premises
Rehabilitation provision
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
2020
$
28,152,622
428,348
87,758
1,797
28,670,525
201,275
48,938,399
1,455,005
499,975
51,094,654
2019
$
1,335,398
735,031
10,993
29,177
2,110,599
115,103
30,675,391
729,089
-
31,519,583
79,765,179
33,630,182
2,915,522
115,864
79,318
-
3,110,704
399,815
1,022,230
1,422,045
1,287,046
-
29,429
12,700,000
14,016,475
-
-
-
4,532,749
14,016,475
75,232,430
19,613,707
130,713,404
862,609
(56,343,583)
75,232,430
70,787,718
1,414,570
(52,588,581)
19,613,707
8
9
10
11
12
13
14
15
16
17
18
19
17
20
21
22
22
The above Consolidated Statement of Financial Position should be read in conjunction with the Notes to the Consolidated
Financial Statements.
31
Consolidated Statement of Changes in Equity
FOR THE YEAR ENDED 30 JUNE 2020
Notes Contributed Equity
Reserves
Accumulated
Losses
Consolidated
$
$
$
Total
$
De Grey Mining Limited
BALANCE AT 30 JUNE 2018
Loss for the year
OTHER COMPREHENSIVE INCOME
22(b)
IN THEIR
TOTAL COMPREHENSIVE LOSS
TRANSACTIONS WITH OWNERS
CAPACITY AS OWNERS
Shares issued during the year
Share issue costs
Share based payments - options
Share based payments – performance rights
Transfer of reserve on exercise options
BALANCE AT 30 JUNE 2019
Loss for the year
OTHER COMPREHENSIVE INCOME
21(b)
21(b)
22(a)
22(a)
22(a)
22(b)
IN THEIR
TOTAL COMPREHENSIVE LOSS
TRANSACTIONS WITH OWNERS
CAPACITY AS OWNERS
Shares issued during the year
Share issue costs
Share based payments - options
Share based payments – performance rights
Transfer of reserve – on exercise of options
Transfer of reserve – on exercise of performance
rights
Transfer of reserve – on expiry of performance
rights
21(b)
21(b)
22(a)
22(a)
22(a)
59,464,845
711,106
(50,579,451)
9,596,500
-
-
-
-
-
-
(2,009,130)
(2,009,130)
-
(2,009,130)
-
(2,009,130)
11,453,068
(178,475)
-
-
48,280
-
-
202,350
549,394
(48,280)
-
-
-
-
-
11,453,068
(178,475)
202,350
549,394
-
70,787,718
1,414,570
(52,588,581)
19,613,707
-
-
-
-
(3,976,002)
(3,976,002)
(3,976,002)
(3,976,002)
62,088,208
(3,144,223)
-
-
310,201
-
-
470,651
180,089
(310,201)
671,500
(671,500)
-
-
-
-
-
-
-
(221,000)
221,000
62,088,208
(3,144,223)
470,651
180,089
-
-
-
BALANCE AT 30 JUNE 2020
130,713,404
862,609
(56,343,583)
75,232,430
The above Consolidated Statement of Changes in Equity should be read in conjunction with the Notes to the Consolidated
Financial Statements.
32
Consolidated Statement of Cash Flows
De Grey Mining Limited
FOR THE YEAR ENDED 30 JUNE 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Option fee received – lag gravel rights
Exploration data sale received
Royalties received
EIS Grant received
Research & development grant received
Payments to suppliers and employees
Interest received
Payments for exploration and evaluation expenditure
NET CASH OUTFLOW FROM OPERATING ACTIVITIES
CASH FLOWS FROM INVESTING ACTIVITIES
Option payments to acquire tenements
Payments to acquire – Indee Gold Pty Ltd
Proceeds/(payments) - available for sale financial assets
Payments for plant and equipment
NET CASH INFLOW / (OUTFLOW) FROM INVESTING ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issues of ordinary shares
Payments of share issue transaction costs
Principal elements of lease payments (AASB 16)
Transaction costs related to loans & borrowings
NET CASH INFLOW FROM FINANCING ACTIVITIES
Notes
Consolidated
2020
$
2019
$
31
330,000
-
16,535
91,102
306,651
(2,762,755)
52,192
(15,456,942)
(17,423,217)
-
(10,142,178)
-
(845,712)
(10,987,890)
58,841,029
(3,144,223)
(100,724)
(367,752)
55,228,330
26,817,224
1,335,398
28,152,622
700,000
150,000
20,335
7,320
-
(2,003,971)
23,265
(8,263,267)
(9,411,599)
(10,000)
(700,000)
94,000
(291,212)
(907,212)
10,836,105
(178,475)
(45,281)
(150,959)
10,461,390
187,860
1,147,538
1,335,398
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
8
The above Consolidated Statement of Cash Flows should be read in conjunction with the Notes to the Consolidated Financial
Statements.
33
De Grey Mining Limited
Notes to the Consolidated Financial Statements
FOR THE YEAR ENDED 30 June 2020
1. Summary of significant accounting policies
De Grey Mining Limited is a company limited by shares, domiciled and incorporated in Australia.
The financial statements are for the consolidated entity consisting of De Grey Mining Limited and its subsidiaries (“Group”),
and have been presented in Australian dollars.
The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies
have been consistently applied to all the years presented, unless otherwise stated.
The financial statements were authorised for issue by the directors on 30 September 2020.
A. Basis of preparation
These general purpose financial statements have been prepared in accordance with the Corporations Act 2001, Australian
Accounting Standards and other authoritative pronouncements of the Australian Accounting Standards Board (AASB).De
Grey Mining Limited is a for-profit entity for the purpose of preparing the financial statements.
(i) Compliance with IFRS
The financial report also complies with the International Financial Reporting Standards (IFRS) including interpretations as
issued by the International Accounting Standards Board (IASB).
(ii) Historical cost convention
These financial statements have been on a historical cost basis, except for available for sale financial assets which have been
measured at fair value through profit or loss.
(iii) New, revised or amending Accounting Standards and Interpretations adopted
The Group has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board (‘AASB’) that are mandatory for the current reporting period. The adoption of these
Accounting Standards and Interpretations did not have any significant impact on the financial performance or position of the
Group during the financial year, other than as noted below.
Standards and interpretations affecting amounts reported in current period (and/or prior periods)
AASB 16 Leases
The Group has adopted AASB 16 from 1 July 2019 using the modified retrospective method of adoption. The Group has not
restated comparatives for the reporting period as permitted under the specific transitional provisions in the standard. The
reclassifications and the adjustments arising from the new leasing rules are therefore recognised in the opening balance
sheet on 1 July 2019.
AASB 16 eliminates the distinction between operating and finance leases and brings all leases (other than short term and
low value leases) on to the balance sheet. As a lessee, the Group recognises a right-of-use asset representing its right to use
the underlying asset and a lease liability representing its obligation to make lease payments.
An assessment is made, at inception or when contract terms are changed, to determine whether the contract is, or contains,
a lease. A contract is or contains a lease if the contract conveys a right to control the use of an identified asset for a period
of time in exchange for consideration.
34
On adoption, the Group recognised lease liabilities in relation to leases which had previously been classified as operating
leases under the principles of AASB 117 Leases. These liabilities were measured at the present value of the remaining lease
payments, discounted using an incremental borrowing rate as of 1 July 2019 of 4%.
The impact on the Group at inception on 1 July 2019 was the recognition of $495,129 right of use assets and a $495,129 lease
liability on the balance sheet, with $87,060 of that lease liability recognised as a current liability and $408,069 as a non-
current liability as outlined in the table that follows:
De Grey Mining Limited
Finance and operating lease liabilities
Recognised at 30 June 2019
Recognised on adoption of AASB16
Lease liability recognised at 1 July 2019
Current
Non-current
Right of use asset
Recognised at 30 June 2019
Recognised on adoption of AASB16 as Plant and Equipment
1 July 2019
$
$
-
495,129
495,129
87,060
408,069
495,129
Nil
495,129
495,129
(iv) New Accounting Standards and Interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory,
have not been early adopted by the Group for the annual reporting period ended 30 June 2020. These new standards will
have no impact on the Group.
B. Principles of consolidation
(i) Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of De Grey Mining Limited
(“company” or “parent entity”) as at 30 June 2020 and the results of all subsidiaries for the year then ended. De Grey Mining
Limited and its subsidiaries together are referred to in this financial report as the Group or the consolidated entity.
Subsidiaries are entities the parent controls. The parent controls an entity when it is exposed to, or has rights to, variable
returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from
the date that control ceases. The acquisition method of accounting is used to account for business combinations by the
Group.
Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by
the Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of
comprehensive income, statement of changes in equity and statement of financial position respectively.
Investments in subsidiaries are accounted for at cost in the separate financial statements of De Grey Mining Limited.
(ii) Joint ventures
Jointly controlled assets - the proportionate interests in the assets, liabilities and expenses of joint venture activities have
been incorporated in the financial statements under the appropriate headings. Details of the joint ventures are set out in
note 30.
35
De Grey Mining Limited
(iii) Changes in ownership interests
The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions with equity
owners of the Group. A change in ownership interest results in an adjustment between the carrying amounts of the
controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the
amount of the adjustment to non-controlling interests and any consideration paid or received is recognised in a separate
reserve within equity attributable to owners of De Grey Mining Limited.
When the Group ceases to have control, joint control or significant influence, any retained interest in the entity is remeasured
to its fair value with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount
for the purposes of subsequently accounting for the retained interest as an associate, jointly controlled entity or financial
asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted
for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised
in other comprehensive income are reclassified to profit or loss.
If the ownership interest in a jointly controlled entity or associate is reduced but joint control or significant influence is
retained, only a proportionate share of the amounts previously recognised in other comprehensive income are reclassified
to profit or loss where appropriate.
C. Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the
operating segments, has been identified as the full Board of Directors.
D. Foreign currency translation
(i)
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary
economic environment in which the entity operates (‘the functional currency’). The consolidated financial statements are
presented in Australian dollars, which is De Grey Mining Limited's functional and presentation currency.
(ii)
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of
the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the
translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in
profit or loss.
(iii)
Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy)
that have a functional currency different from the presentation currency are translated into the presentation currency as
follows:
•
assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of
that statement of financial position;
income and expenses for each statement of comprehensive income are translated at average exchange rates (unless
that is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which
case income and expenses are translated at the dates of the transactions); and
all resulting exchange differences are recognised in other comprehensive income.
•
•
36
De Grey Mining Limited
E. Revenue recognition
Revenue from contract(s) with customers
Revenue is recognised at an amount that reflects the consideration to which the group is expected to be entitled in exchange
for transferring goods or services to a customer. For each contract with a customer, the consolidated entity: identifies the
contract with a customer; identifies the performance obligations in the contract; determines the transaction price which
takes into account estimates of variable consideration and the time value of money; allocates the transaction price to the
separate performance obligations on the basis of the relative stand-alone selling price of each distinct good or service to be
delivered; and recognises revenue when or as each performance obligation is satisfied in a manner that depicts the transfer
to the customer of the goods or services promised.
Variable consideration with the transaction price, if any, reflects concessions provided to the customers such as discounts,
rebates and refunds, any potential bonuses receivable from the customer and any other contingent events. Such estimates
are determined using either the ‘expected value’ or ‘most likely amount’ method. The measurement of the variable
consideration is subject to a constraining principle whereby revenue will only be recognised to the extent that it is highly
probably that a significant reversal in the amount of cumulative revenue recognised will not occur. The measurement
constraint continues until the uncertainty associated with the variable consideration is subsequently resolved. Amounts
received that are subject to the constraining principle are recognised as a refund liability.
Interest Revenue
Interest income is recognised as it accrues using the effective interest method.
F. Cash and cash equivalents
For the purposes of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits
held at call with financial institutions, other short-term highly liquid investments with original maturities of nine months or
less that are readily convertible to known amounts of cash and which are subject to insignificant risk of changes in value, and
bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the statement of financial position.
G. Trade & other receivables
Classification as trade and other receivables
If collection of the amounts is expected in one year or less they are classified as current assets. If not, they are presented as
non-current assets. Trade receivables are generally due for settlement within 30 days and therefore are all classified as
current.
Fair value of trade and other receivables
As the majority of receivables are short term in nature, their carrying amount is assumed to be the same as their fair value.
H. Income tax
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the
applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to
temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the
reporting period in the countries where the Company’s subsidiaries and associates operate and generate taxable income.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation
is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the
tax authorities.
37
De Grey Mining Limited
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income
tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business
combination that at the time of the transaction affects neither accounting nor taxable profit or loss.
Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the
reporting date and are expected to apply when the related deferred income tax asset is realised, or the deferred income
tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases
of investments in controlled entities where the parent entity is able to control the timing of the reversal of the temporary
differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities
and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset
where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset
and settle the liability simultaneously.
De Grey Mining Limited and its wholly-owned Australian controlled entities have implemented the tax consolidation
legislation. As a consequence, these entities are taxed as a single entity and the deferred tax assets and liabilities of these
entities are set off in the consolidated financial statements.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or
directly in equity, respectively.
I. Financial instruments
Classification of financial instruments
those to be measured at fair value (either through other comprehensive income, or through profit or loss); and
those to be measured at amortised cost.
The Group classifies its financial assets into the following measurement categories:
•
•
The classification depends on the Group’s business model for managing financial assets and the contractual terms of the
financial assets' cash flows.
The Group classifies its financial liabilities at amortised cost unless it has designated liabilities at fair value through profit or
loss or is required to measure liabilities at fair value through profit or loss such as derivative liabilities.
Debt instruments
Investments in debt instruments are measured at amortised cost where they have:
•
contractual terms that give rise to cash flows on specified dates, that represent solely payments of principal and
interest on the principal amount outstanding; and
are held within a business model whose objective is achieved by holding to collect contractual cash flows.
•
These debt instruments are initially recognised at fair value plus directly attributable transaction costs and subsequently
measured at amortised cost. The measurement of credit impairment is based on the three-stage expected credit loss model
described below regarding impairment of financial assets.
Financial instruments designated as measured at fair value through profit or loss
Financial instruments held at fair value through profit or loss are initially recognised at fair value, with transaction costs
recognised in the income statement as incurred. Subsequently, they are measured at fair value and any gains or losses are
recognised in the income statement as they arise.
38
De Grey Mining Limited
Where a financial asset is measured at fair value, a credit valuation adjustment is included to reflect the credit worthiness
of the counterparty, representing the movement in fair value attributable to changes in credit risk.
A financial liability may be designated at fair value through profit or loss if it eliminates or significantly reduces an accounting
mismatch or:
•
•
if a host contract contains one or more embedded derivatives; or
if financial assets and liabilities are both managed and their performance evaluated on a fair value basis in accordance
with a documented risk management or investment strategy.
Where a financial liability is designated at fair value through profit or loss, the movement in fair value attributable to
changes in the Group’s own credit quality is calculated by determining the changes in credit spreads above observable
market interest rates and is presented separately in other comprehensive income.
Impairment of financial assets
The entity recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised
cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon the entity's
assessment at the end of each reporting period as to whether the financial instrument's credit risk has increased
significantly since initial recognition, based on reasonable and supportable information that is available, without undue
cost or effort to obtain.
Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected
credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable
to a default event that is possible within the next 12 months.
Where a financial asset has become credit impaired or where it is determined that credit risk has increased significantly,
the loss allowance is based on the asset's lifetime expected credit losses. The amount of expected credit loss recognised is
measured on the basis of the probability weighted present value of anticipated cash shortfalls over the life of the instrument
discounted at the original effective interest rate.
Recognition and derecognition of financial instruments
A financial asset or financial liability is recognised in the balance sheet when the Group becomes a party to the contractual
provisions of the instrument, which is generally on trade date. Loans and receivables are recognised when cash is advanced
(or settled) to the borrowers.
Financial assets at fair value through profit or loss are recognised initially at fair value. All other financial assets are
recognised initially at fair value plus directly attributable transaction costs.
The Group derecognises a financial asset when the contractual cash flows from the asset expire or it transfers its rights to
receive contractual cash flows from the financial asset in a transaction in which substantially all the risks and rewards of
ownership are transferred. Any interest in transferred financial assets that is created or retained by the Group is recognised
as a separate asset or liability.
A financial liability is derecognised from the balance sheet when the Group has discharged its obligations, or the contract
is cancelled or expires.
Offsetting
Financial assets and liabilities are offset and the net amount is presented in the balance sheet when the Group has a legal
right to offset the amounts and intends to settle on a net basis or to realise the asset and settle the liability simultaneously.
39
De Grey Mining Limited
J. Plant and equipment
Each class of Plant, equipment and motor vehicle is carried at historical cost or fair value as indicated less, where applicable,
any accumulated depreciation and impairment losses. Cost includes expenditure that is directly attributable to the asset.
The carrying amounts are reviewed annually by Directors to ensure it is not in excess of the estimated recoverable amount
from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received
from the asset’s employment and subsequent disposal. The expected net cash flows have been discounted to their present
values in determining recoverable amounts and an asset’s carrying amount is written down immediately to its recoverable
amount if the asset’s carrying amount is greater than its estimated recoverable amount.
Depreciation of plant and equipment is calculated using the reducing balance method to allocate their cost or revalued
amounts, net of their residual values, over their estimated useful lives or, in the case of leasehold improvements and certain
leased plant and equipment, the shorter lease term. The rates vary between 20% and 40% per annum.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.
K. Right of use assets and lease liabilities
The Group recognises a right-of-use asset representing its right to use the underlying asset and a lease liability representing
its obligation to make lease payments and discloses the right of use asset separately as a Non-current asset.
An assessment is made, at inception or when contract terms are changed, to determine whether the contract is, or contains,
a lease. A contract is or contains a lease if the contract conveys a right to control the use of an identified asset for a period
of time in exchange for consideration.
The Group recognises all right of use assets and liabilities, except for leases that are short-term (12 months or less) and low
value leases at the lease commencement date. The lease liability is measured at the present value of the future lease
payments and includes lease extension options when the Group is reasonably certain that it will exercise the option.
The present value of future lease payments is determined by discounting future lease payments using the interest rate
implicit in the lease or, if that rate cannot be determined then the Group’s borrowing rate, which is generally the case.
The right of use asset, at initial recognition, reflects the lease liability and is depreciated over the term of the lease. The
present value of the lease liability is increased by the interest cost and decreased by the lease payment each period over
the life of the lease.
For leases that are short-term (12 months or less) and/or low value leases at the lease commencement date, the Group
recognises the lease payments as an operating expense on a straight-line basis over the term of the lease unless another
systematic basis is more representative of the time pattern in which economic benefits from the leased assets are
consumed.
L. Exploration and evaluation costs
Exploration and evaluation expenditures in relation to each separate area of interest are recognised as an exploration and
evaluation asset in the year in which the expenditure is incurred where;
•
•
The Group has secured (or has the legal right to) tenure, and/or the legal rights to explore an area of interest;
Exploration and evaluation activities in the area of interest have not at the end of the reporting period reached a stage
which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active
and significant operations in, or in relation to, the area of interest are continuing; and
The exploration and evaluation expenditures are expected to be recouped through successful development and
exploitation of the area of interest, or alternatively, by its sale.
•
Where the conditions outlined are not met in relation to specific area(s) of interest, then those exploration and evaluation
costs are expensed as incurred.
40
M. Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year which
are unpaid. The amounts are unsecured and are paid on normal commercial terms.
De Grey Mining Limited
N. Employee benefits
Wages and salaries, annual leave and long service leave
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be
settled within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities are
settled. The liability for annual leave and long service leave is recognised in the provision for employee benefits. All other
short-term employee benefit obligations are presented as payables.
O. Rehabilitation provision
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is
probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated.
Provisions are not recognised for future operating losses.
Provisions are measured at the present value of management's best estimate of the expenditure required to settle the
present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax
rate that reflects current market assessments of the time value of money and the risks specific to the liability.
Rehabilitation costs include the dismantling and removal of mining plant, equipment and building structures, waste removal
and rehabilitation of the site in accordance with the requirements of the mining permits. Such costs are determined using
estimates of future costs, current legal requirements and technology.
Rehabilitation costs are recognised in full at present value as a non-current liability. An equivalent amount is capitalised as
part of the cost of the asset when an obligation arises to decommission or restore a site to a certain condition after
abandonment as a result of bringing the assets to its present location. The capitalised cost is amortised over the life of the
project and the provision is accreted periodically as the discounting of the liability unwinds. The unwinding of the discount
is recorded as a finance cost.
Any changes in the estimates for the costs or other assumptions against the cost of relevant assets are accounted
for on a prospective basis. In determining the costs of site restoration there is uncertainty regarding the nature and
extent of the restoration due to community expectations and future legislation.
P. Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds.
Q. Earnings per share
(i) Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the company, excluding any costs of
servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the
financial year, adjusted for bonus elements in ordinary shares issued during the year.
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account
the after-income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the
weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential
ordinary shares.
41
De Grey Mining Limited
R. Share-based payments
The Group provides benefits to employees (including directors) of the Group in the form of share-based payment
transactions, whereby employees render services in exchange for shares or rights over shares (‘equity-settled
transactions’), refer to note 33.
The cost of these equity-settled transactions with employees is measured by reference to the fair value at the date at which
they are granted. The fair value is determined by an internal valuation using a Black-Scholes option pricing model.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in
which the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled
to the award (‘vesting date’).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the
extent to which the vesting period has expired and (ii) the number of options that, in the opinion of the directors of the
Group, will ultimately vest. This opinion is formed based on the best available information at balance date. No adjustment
is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the
determination of fair value at grant date.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a
market condition.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not
yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award
and designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if they
were a modification of the original award.
Options over ordinary shares have also been issued as consideration for the acquisition of interests in tenements and other
services. These options have been treated in the same manner as employee options described above, with the expense
being included as part of exploration expenditure.
S. Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part
of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST
recoverable from, or payable to, the taxation authority is included with other receivables or payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities
which are recoverable from, or payable to the taxation authority, are presented as operating cash flows.
T. Significant accounting judgements estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts in the financial statements. Management continually evaluates these judgements, estimates
and assumptions, taking into consideration matters such as historical experiences and its expectations of future events. The
The material significant judgements, estimates and assumptions within this financial report are:
Exploration and evaluation expenditure – Note 13.
•
• Rehabilitation provision – Note 20.
•
Share based payments – Note 33.
42
De Grey Mining Limited
2. Financial Risk Management
The Group’s exposure to a variety of financial risks that may affect the Group’s future financial performance. The Board has
the overall responsibility for the establishment, with the Audit and Risk Committee having oversight of all risk management
policies.
The Committee reports periodically to the Board on its activities and with the assistance of senior management team are
responsible for identifying, assessing, treating and monitoring risks and risk management policies. The Committee oversees
management’s compliance monitoring processes as well as reviewing the adequacy of the risk management framework in
relation to the risks faced by the Group.
Risk management policies and systems are reviewed regularly by the senior management team to reflect changes in market
conditions and the Group’s activities. The Group aims to develop a disciplined and constructive control environment in
which all employees understand their roles and obligations.
A. Market risk
Foreign exchange risk
The Group’s operations are in Australia and currently has limited exposures to foreign exchange risk arising from foreign
currency transactions.
Foreign exchange risk arises from recognising assets and liabilities denominated in a currency that is not the functional
currency of the relevant entity. The Company has a holding of Canadian dollar listed securities.
Financial assets at fair value thru the profit or loss
Consolidated Total
2020
$
201,275
201,275
2019
$
115,103
115,103
The sensitivity of profit or loss to changes in the exchange rates arises mainly from Canadian dollar-denominated financial
instruments. A 10 percent increase in the AUD/CAD exchange rate would increase post tax loss by $18,298, while a 10 percent
decrease in the AUD/CAD exchange rate would decrease post tax loss by $22,364.
Price risk
Given the current level of operations, the Group is not exposed to price risk.
Interest rate risk
The Group is exposed to movements in market interest rates on cash and cash equivalents. The Group policy is to monitor
the interest rate yield curve out to six months to ensure a balance is maintained between the liquidity of cash assets and
the interest rate return.
The balance of cash and cash equivalents for the Group of $28,152,622 (2019: $1,335,398) is subject to interest rate risk.
The proportional mix of floating interest rates and fixed rates to a maximum of six months fluctuate during the year
depending on current working capital requirements. The weighted average interest rate received on cash and cash
equivalents by the Group was 0.70% (2019: 0.54%).
Sensitivity analysis
At 30 June 2020, if interest rates had changed by -/+ 100 basis points from the weighted average rate for the year with all
other variables held constant, post-tax loss for the Group would have been $78,721 lower/higher (2019: $36,615
lower/higher) as a result of lower/higher interest income from cash and cash equivalents.
43
De Grey Mining Limited
B. Credit risk
Credit risk refers to the risk that a counter party will default on its contractual obligation resulting in financial loss to
the Group.
(i) Risk management
The Group has adopted the policy of dealing with creditworthy counterparties as a means of mitigating the risk of financial
loss from defaults. Cash is deposited only with institutions approved by the Board and typically with a current minimum
credit rating of A (or equivalent) as determined by a reputable credit rating agency. The Group has established a policy of
having aggregate funds on term deposit or invested in money markets allocated across financial counterparties.
Trade receivables
Counterparties without external credit rating - other
Total trade receivables
Cash and cash equivalents
A + external credit rating
A - external credit rating
Total cash and cash equivalents
(ii) Impaired trade receivables
Consolidated Total
2020
$
2019
$
48,510
48,510
359,562
359,562
22,152,622
6,000,000
28,152,622
1,335,398
-
1,335,398
In determining the recoverability of trade and other receivables, the Group performs a risk analysis considering the type and
age of the outstanding receivable and the creditworthiness of the counterparty. If appropriate, an impairment loss is
recognised in profit or loss. The Group does not have any impaired Trade and other receivables as at 30 June 2020 (2019:
nil).
C. Liquidity risk
The Group manages liquidity risk by monitoring the immediate and forecasted cash requirements, and ensures that
adequate cash reserves and/or marketable securities are available to pay debts as and when due.
The Group’s primary activities are currently mineral exploration. Prudent liquidity risk management implies maintaining
sufficient cash and marketable securities as the Group does not have ready access to credit facilities at this stage of its life
cycle. Management regularly monitor its rolling cash forecasts and the state of equity markets in initiating the timing of
capital raisings for its future funding requirements.
44
Maturities of financial liabilities
An analysis of the Group's financial liabilities into relevant maturity groupings based on their contractual maturities and on
the basis of the contractual undiscounted cash flows as presented in the table that follows.
De Grey Mining Limited
As at 30 June 2020
Trade and other payables
Operating lease liabilities
Total non-derivatives
As at 30 June 2019
Trade and other payables
Operating lease liabilities
Contract liabilities
Total non-derivatives
D. Fair value estimation
Less than
6 months
6-12
months
$
2,915,522
57,005
2,972,527
$
-
58,859
58,859
1-2
years
$
-
125,220
125,200
2-5
years
$
-
274,595
274,595
Total
$
2,915,522
515,679
3,431,201
1,287,046
-
12,700,000
13,987,046
-
-
-
-
-
-
-
-
-
-
-
-
1,287,046
-
12,700,000
13,987,046
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for
disclosure purposes. All financial assets and financial liabilities of the Group at the balance date are recorded at amounts
approximating their carrying amount. The fair value of financial instruments traded in active markets is based on quoted
market prices at the reporting date. The quoted market price used for financial assets held by the Group is the current bid
price.
The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values
due to their short-term nature.
3. Capital management
The Group’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they may
continue to provide returns for shareholders and benefits for other stakeholders
Due to the nature of the Group’s activities, being mineral exploration, the Group does not have ready access to credit
facilities, with the primary source of funding being equity raisings. Therefore, the focus of the Group’s capital risk
management is the current working capital position against the requirements of the Group to meet exploration programmes
and corporate overheads.
The Group’s strategy is to ensure appropriate liquidity is maintained to meet anticipated operating requirements, with a
view to initiating appropriate capital raisings as required. The working capital position of the Group at 30 June 2020 and 30
June 2019 are as follows:
Cash and cash equivalents
Trade and other receivables
Trade and other payables (i)
Working capital position
2020
$
28,152,622
430,145
(3,031,386)
25,551,381
Consolidated
2019
$
1,335,398
735,031
(1,039,868)
1,030,561
(i) This is net of payables totalling $Nil (2019: $247,178) settled/or to be settled by an equity issue of ordinary fully paid shares.
45
De Grey Mining Limited
4. Segment Information
Management has determined the operating segments based on the reports reviewed by the Board of Directors that are used
to make strategic decisions. For management purposes, the Group has identified one reportable operating segment being
exploration activities undertaken in one geographical segment being Australasia. These segments include the activities
associated with the determination and assessment of the existence of commercial economic reserves, from the Group’s
mineral assets in the sole geographic location.
Segment performance is evaluated based on the operating profit and loss and cash flows and is measured in accordance with
the Group’s accounting policies.
Segment revenue
102,991
1,178,541
102,991
1,178,541
Minerals Exploration
Australasia
Consolidated Total
2020
$
2019
$
2020
$
2019
$
Reconciliation of segment revenue to total revenue
before tax:
Interest revenue
Change in fair value of equity investments at fair value
through profit or loss
Other revenue
Total revenue and other income
78,721
19,744
86,172
98,145
366,029
9,103
46,541
1,253,929
Segment results
(120,533)
1,020,483
(120,533)
1,020,483
Reconciliation of segment result to net loss before tax:
Corporate advisory
Share based payments
Other corporate and administration
Net loss before tax
(566,858)
(650,740)
(2,637,871)
(3,976,002)
(133,501)
(751,744)
(2,144,368)
(2,009,130)
Segment operating assets
50,437,690
32,160,880
50,437,690
32,160,880
Reconciliation of segment operating assets to total
assets:
Cash and cash equivalents
Other corporate and administration assets
Total assets
29,327,489
79,765,179
1,469,302
33,630,182
Segment operating liabilities
3,562,853
13,491,175
3,562,853
13,491,175
Reconciliation of segment operating liabilities to total
liabilities:
Other corporate and administration liabilities
Total liabilities
969,896
4,532,749
525,300
14,016,475
46
5. Revenue and other income
Revenue - from continuing operations
Option fee – lag gravels (i)
Exploration data fee
Royalties- sands
Other Income
EIS Grant
Interest income
Change in fair value of equity investments through profit or loss
Other
De Grey Mining Limited
Note
Consolidated
2020
$
-
-
11,889
91,102
78,721
86,172
98,145
366,029
2019
$
1,000,000
150,000
21,221
7,320
19,744
9,103
46,541
1,253,929
(i) The prior financial year lag gravels option fee relates to a binding Letter of Intent with Novo Resources Corp that granted them the
right to explore the Mallina Gold Project (for gold-bearing lag gravel deposits for an initial three-year period from 30 June 2019.
6. Expenses
Loss before income tax includes the following specific expenses:
Contributions to superannuation funds
Lease liability – interest charge
Share based payments – options (Directors & under approved plan)
Share based payments – performance rights (Directors & under approved plan)
Share based payments – corporate advisory services
15
33
33
33
199,747
14,025
334,400
180,089
136,251
130,663
-
202,350
549,394
-
7. Income tax
(a) Income tax expense
Current tax
Deferred tax
(b) Numerical reconciliation of income tax expense to prima facie tax payable
Loss from continuing operations before income tax expense
Prima facie tax benefit at the Australian tax rate of 27.5% (2019: 27.5%)
Tax effect of amounts which are not deductible (taxable) in calculating taxable
income:
Capital raising fees
Other allowable expenditure
Sundry items
Tax effect of current year tax losses for which no deferred tax asset has been
recognised
Income tax expense
(c) Unrecognised deferred tax assets
Capital raising fees
Carry forward tax losses
Gross deferred tax assets
47
-
-
-
-
-
-
(3,976,002)
(2,009,130)
(1,093,401)
(552,511)
(219,286)
(5,022,327)
137,979
(6,197,035)
(46,354)
(2,474,823)
240,256
(2,833,431)
6,197,035
-
2,833,431
-
752,058
22,990,529
23,742,587
106,682
17,077,916
17,184,598
De Grey Mining Limited
No deferred tax asset has been recognised for the above balance as at 30 June 2020 and it is not considered probable that
future taxable profits will be available against which it can be utilised.
(d) Tax consolidation
Effective 1 July 2004, for the purposes of income taxation, De Grey Mining Limited and its 100% owned Australian subsidiaries
formed a tax consolidated group. Members of the group have entered into a tax sharing arrangement in order to allocate
income tax between the entities should the head entity default on its tax payment obligations. At the balance date, the
possibility of default is remote. The head entity of the tax consolidated group is De Grey Mining Limited.
The entities have also entered into a tax funding agreement under which the wholly-owned entities fully compensate De
Grey Mining Limited for any current tax payable assumed and are compensated by De Grey Mining Limited for any current
tax receivable and deferred tax assets relating to unused tax losses or unused tax credits that are transferred to De Grey
Mining Limited under the tax consolidation legislation. The funding amounts are determined by reference to the amounts
recognised in the wholly-owned entities’ financial statements.
The amounts receivable/payable under the tax funding agreement are due upon receipt of the funding advice from the head
entity, which is issued as soon as practicable after the end of each financial year. The head entity may also require payment
of interim funding amounts to assist with its obligations to pay tax instalments. The funding amounts are recognised as
current intercompany receivables or payables.
Effective 21 August 2019, for the purposes of income taxation, new subsidiary Indee Gold will be added to the tax
consolidated group.
(e) Franking credits
The company has no franking credits available for use in future years.
8. Current assets – Cash and cash equivalents
Cash at bank & on hand (i)
Short-term & on-call deposits (ii)
Consolidated
2020
$
2019
$
391,734
27,760,888
28,152,622
838,960
496,438
1,335,398
(i) Cash at bank earns interest at floating rates based on daily bank deposit rates.
(ii) Short-term deposits are made for varying periods of between one day and up to nine months depending on the
immediate cash requirements of the Group and earn interest at the respective short-term deposit rates.
9. Current assets – Trade and other receivables
Trade receivables
GST receivable (net)
R&D offset receivable
Fuel tax credits receivable
Accrued interest
Sundry debtors
48,510
252,580
-
67,075
26,767
33,416
428,348
359,562
34,140
306,651
34,143
-
535
735,031
As the majority of receivables are short term in nature, their carrying amount is assumed to be the same as their fair value.
48
10. Current assets - Inventories
Diesel fuel inventories
11. Current assets – Other assets
Prepayment – other
Advances & deposits
12. Financial assets
Financial assets at fair value through profit or loss
Current
De Grey Mining Limited
Consolidated
2020
$
87,758
87,758
2019
$
10,993
10,993
-
1,797
1,797
27,380
1,797
29,177
Canadian (TSX-V) listed equity securities (i) (ii)
115,103
115,103
(i) The financial assets are presented as non-current assets unless management intends to dispose of them within 12
201,275
201,275
months of the end of the reporting period.
(ii) Financial assets are valued at the quoted closing share price as at reporting date. During the year, a gain of $86,172
(2019: $9,103) was recognised in the profit and loss and other comprehensive income (Note 5).
13. Non-current assets – Deferred exploration & evaluation expenditure
Beginning of financial period
Exploration expenditure - all areas of interest (i)
Tenement option payments (non Indee Gold Pty Ltd)
Indee Gold Pty Ltd –recognised on settlement of acquisition (Note 29)
Expensed to P&L
30,675,391
16,839,283
-
1,451,296
(27,571)
48,938,399
21,982,686
8,682,705
10,000
-
-
30,675,391
(i) The Group has capitalised all costs associated with The Mallina Project. The recoverability of the carrying amount of the
exploration and evaluation assets is dependent on successful development and commercial exploitation, or
alternatively, sale of the respective areas of interest.
14. Non-current assets – Property, plant and equipment
Plant and equipment
Cost
Accumulated depreciation
Net book amount
Plant and equipment
Opening net book amount
Additions
Additions – on acquisition of Indee Gold Pty Ltd (Note 29)
Assets written-off
Depreciation charge
Depreciation written back on assets written-off
Closing net book amount
49
1,944,765
(489,760)
1,455,005
729,089
946,272
13,113
(351,184)
(233,469)
351,184
1,455,005
1,349,679
(620,590)
729,089
691,087
220,119
-
-
(182,117)
-
729,089
15. Non-current Right of use asset
Right of use asset – office premises
Cost (i)
Accumulated depreciation
Net book amount
Plant and equipment
Opening net book amount
Additions on inception – 1 July 2019 (ii)
Additions – additions for the year
Depreciation for the year – leased office premises
Closing net book amount
De Grey Mining Limited
Consolidated
2020
2019
603,329
(103,354)
499,975
-
495,129
108,200
(103,354)
499,975
-
-
-
-
-
-
-
-
(i) The right of use asset assumes that the options for office lease term extensions will be exercised.
(ii) The impact on the Group at inception on 1 July 2019 was the recognition of $495,129 right of use assets and a $495,129 lease liability
on the balance sheet, with $87,060 of that lease liability recognised as a current liability and $408,069 as a non-current liability as
outlined in the table that follows:
Finance and operating lease liabilities
Recognised at 30 June 2019
Recognised on adoption of AASB16
Initial lease liability recognised at 1 July 2019
Current
Non-current
Right of use asset
Recognised at 30 June 2019
Recognised on adoption of AASB16
16. Current liabilities – Trade and other payables
Trade payables
Trade payables to be settled via an equity issue
Other payables and accruals (i)
1 July 2019
$
Nil
495,129
495,129
87,060
408,069
495,129
Nil
495,129
495,129
Consolidated
2020
$
2,798,952
-
116,570
2,915,522
2019
$
907,792
247,178
132,076
1,287,046
(i) Trade, other payables and accruals are non-interest bearing and are normally settled on terms of 30-45 days.
50
17. Current & non-current operating lease liabilities
Current
Operating lease liabilities – office premises
Non-current
Operating lease liabilities – office premises
De Grey Mining Limited
Consolidated
2020
$
115,864
399,815
2019
$
-
-
18. Current liabilities – Employee benefit obligations
Employee benefit obligations (i)
79,318
29,429
(i) The current provision for employee benefits includes all unconditional entitlements where employees have completed
the required period of service. The entire amount is presented as current, since the consolidated entity does not have an
unconditional right to defer settlement and has an expectation that employees will take the full amount of accrued leave
or require payment within the next 12 months.
19. Current liabilities – Contract liabilities
Contract liabilities (i)
-
-
12,700,000
12,700,000
(i) On 12 February 2018, the Company executed a fully binding Share Sale Agreement (“SSA”) to acquire 100% of the issued
shares in the capital of Indee Gold Pty Ltd (“Indee Gold”) from Northwest Nonferrous Australia Mining Pty Ltd (“NNAM”).
On 22 August 2019, settlement was completed, and the Company became the 100% shareholder of Indee Gold Pty Ltd,
with the final payment of $9.7 Million in cash and 59,065,579 shares in De Grey (valued at $3.0 Million on allotment) as
full and final settlement of the outstanding Contract liabilities.
20. Non-current liabilities – Rehabilitation provision
Rehabilitation provision (i)
1,022,230
1,022,230
-
-
(i) This provision was brought to account on settlement of the Indee Gold acquisition, and covers the mining leases the
subject of an approved Mine closure plan (Note 29). The Group assesses its mine rehabilitation provision annually.
Significant judgement is required in determining the provision for mine rehabilitation and closure as there are many
factors that will affect the ultimate liability payable to rehabilitate the mine sites, including future disturbances caused
by further development, changes in technology, changes in regulations, price increases, changes in timing of cash flows
which are based on life of mine plans and changes in discount rates. When these factors change or become known in the
future, such differences will impact the mine rehabilitation provision in the period in which the change becomes known.
51
21. Contributed equity
(a) Share capital
Ordinary shares fully paid
Total contributed equity
(b) Movements in ordinary share capital
Beginning of the financial year
Issued during the current & prior years:
Shares issued on exercise of options
De Grey Mining Limited
2020
2019
Issue
Price
Number of
shares
$
Number of
shares
$
1,172,514,204
130,713,404
427,590,370
70,787,718
1,172,514,204
130,713,404
427,590,370
70,787,718
427,590,370
70,787,718
334,468,800
59,464,846
$0.10
$0.30
$0.04
Placement share issue
Shares issued on exercise of options
Shares issued on exercise of options
Shares issued on exercise of options
Share issued in exercise of performance rights
Share issued in lieu of supplier invoices (non-cash)
-
17,039,286
13,016,667
600,000
3,802,748
3,950,000
-
$0.20
$0.045 111,111,111
$0.05 444,142,014
92,196,429
$0.28
59,065,579
Shares issued part consideration – Indee Gold Pty Ltd (non-cash) $0.050791
-
Transaction costs
-
Placement share issue
Placement share issue
Placement share issue
$0.35
Share based payments reserve transfer on option exercise
Share based payments reserve transfer on performance rights
exercise
-
1,703,928
3,905,000
210,000
247,179
-
-
5,000,000
22,207,101
25,815,000
3,000,000
(3,144,223)
310,201
3,084,611
59,627,200
-
-
5,409,759
-
25,000,000
-
-
-
-
-
-
123,384
5,962,720
-
-
616,963
-
4,750,000
-
-
-
-
(178,475)
48,280
End of the financial year
(c) Movements in options on issue
Beginning of the financial year
Net issued / (exercised or cancelled) during the year:
− Exercisable at 4 cents, on or before 10 June 2019
− Exercisable at 10 cents, on or before 30 Nov 2018
− Exercisable at 10 cents, on or before 30 Nov 2018
− Exercisable at 10 cents, on or before 31 Oct 2019
− Exercisable at 20 cents, on or before 30 Nov 2019
− Exercisable at 25 cents, on or before 30 Nov 2019
− Exercisable at 30 cents, on or before 30 May 2021
− Exercisable at 30 cents, on or before 30 Sep 2021
− Exercisable at 10 cents, on or before 31 Dec 2021
− Exercisable at 35 cents, on or before 12 Mar 2021
End of the financial year
-
1,172,514,204
671,500
130,713,404
-
427,590,370
-
70,787,718
Number of options
2020
2019
77,333,333
110,295,144
-
-
-
(7,039,286)
(33,333,333)
(12,500,000)
(13,016,667)
1,500,000
2,000,000
4,900,000
19,844,047
(3,084,611)
(53,527,200)
(6,100,000)
-
-
12,500,000
17,250,000
-
-
-
77,333,333
Unlisted
Listed
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
52
(d) Movement in performance rights on issue
During the year there were no unlisted Performance Rights issued (2019: nil) to directors and employees of the Group.
Tranche 1¹
Tranche 22
Tranche 3¹
Tranche 4
Tranche 5¹
Total
De Grey Mining Limited
Opening balance – 1 July 2019
1,300,000
1,300,000
1,450,000
1,450,000
1,200,000
6,700,000
Performance rights vested
(1,300,000)
(1,450,000)
Performance rights expired
Performance rights issued
Closing balance – 30 June 2020
-
-
-
(1,300,000)
-
-
-
-
-
-
-
-
1,450,000
(1,200,000)
(3,950,000)
-
-
-
(1,300,000)
-
1,450,000
1. The vesting conditions for tranches one, three and five were met during the reporting period. Each of the tranches were
exercised by the holders and shares allotted on 22 August 2019.
• Tranche One – the Company declaring greater than 1,500,000 ounce gold resource (JORC 2012) at an overall grade of
at least 1.7 g/t and a minimum category of JORC inferred at the Mallina Gold Project, on or before 30 November 2019;
• Tranche Three – settlement of the Company’s 100% acquisition of Indee Gold Pty Ltd; and
• Tranche Five – The Company confirming higher grade resources of at least 200,000 ounces and at an overall grade of
greater than 5 g/t or before 30 November 2019.
2. The vesting conditions for the following tranche expired during the financial year:
• Tranche Two – the Company declaring greater than 2,000,000 ounce gold resource (JORC 2012) at an overall grade of
at least 1.7 g/t and a minimum category of JORC inferred at the Mallina Gold Project, or before 30 November 2019.
3. The following Performance Right tranche remains outstanding as at the end of the financial year:
• Tranche Four – The Company securing Project Financing for the Mallina Gold Project at a minimum throughput of 1M
tpa.
(e) Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the company in proportion
to the number of and amounts paid on the shares held. On a show of hands every holder of ordinary shares present at a
meeting in person or by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote. Ordinary shares
have no par value and the Company does not have a limited amount of authorised capital. Neither the Company, nor any of
its subsidiaries, holds any shares in the Company at 30 June 2020 (2019: Nil).
53
22. Reserves and accumulated losses
(a) Reserves
Share-based payments reserve (i)
Movements:
Share-based payments reserve
Balance at beginning of year
Share based payments (options) expense (Directors & EOP plan)
Share based payments (options) expense (Corporate advisory)
Share based payments (performance rights) expense (Directors & PR plan)
Transfer to Issued Capital on exercise of performance rights
Transfer to Issued Capital on exercise of options
Transfer to Accumulated losses on expiry of performance rights
Balance at end of year
(b) Accumulated losses
Balance at beginning of year
Net loss for the year
Transfer from Reserves on expiry of performance rights
Balance at end of year
De Grey Mining Limited
Consolidated
2020
$
862,609
862,609
1,414,570
334,400
136,251
180,089
(671,500)
(310,201)
(221,000)
862,609
2019
$
1,414,570
1,414,570
711,106
202,350
-
549,394
-
(48,280)
-
1,414,570
(52,588,581)
(3,976,002)
221,000
(56,343,583)
(50,579,451)
(2,009,130)
-
(52,588,581)
(c) Nature and purpose of reserves
(i) Share-based payments reserve - The share-based payments reserve is used to recognise the value of equity benefits provided to either
employees or directors as remuneration or to suppliers as payment for products and services.
23. Dividends
No dividends were paid during the financial year.
No recommendation for payment of dividends has been made.
24.
Remuneration of auditors
During the year the following fees were paid or payable for services
provided by the auditor of the parent entity, its related practices and non-
related audit firms:
(a) Audit services
Butler Settineri (Audit) Pty Ltd - audit and review of financial reports
Total remuneration for audit services
(b) Non-audit services
Butler Settineri – tax compliance services
Total remuneration for other services
54
-
-
47,842
47,842
3,675
3,675
33,777
33,777
2,800
2,800
25. Contingent liabilities
There are no contingent liabilities or contingent assets of the Group at reporting date.
26. Commitments
(a) Exploration commitments
The Group has certain commitments to meet minimum expenditure
requirements on the mineral exploration assets it has an interest in.
Outstanding Mallina Project exploration commitments are as follows:
Mallina Project tenements (100% owned)
Tenements under option agreements (i)
Annual commitment for the Mallina Project assets
De Grey Mining Limited
Consolidated
2020
$
2019
$
1,474,040
199,280
1,673,320
1,474,760
197,160
1,671,920
(i) The tenements that remain under option and/or earn-in agreements are with respect to the Farno McMahon and
Vanmaris Projects, as detailed in Note 30.
(b) Capital commitments
The Group did not have any capital commitments as at the current or prior balance date.
27. Related party transactions
(a) Parent entity
The ultimate parent entity within the Group is De Grey Mining Limited.
(b) Subsidiaries
Interests in subsidiaries are set out in note 28.
(c) Transactions with related parties
Transactions between related parties are on commercial terms and conditions, no more favourable than those available to
other parties unless otherwise stated.
(d) Loans to related parties
De Grey Mining Limited has provided unsecured, interest free loans to each of its wholly owned Australian subsidiaries and
all of which have been fully impaired.
55
De Grey Mining Limited
28.
Subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance
with the accounting policy described in note 1(b):
Name
Country of Incorporation Class of Shares
Equity Holding¹
Beyondie Gold Pty Ltd
Domain Mining Pty Ltd
Winterwhite Resources Pty Ltd
Last Crusade Pty Ltd
Indee Gold Pty Ltd²
Australia
Australia
Australia
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
¹ The proportion of ownership interest is equal to the proportion of voting power held.
² The acquisition of Indee Gold Pty Ltd was completed on 22 August 2019.
29. Asset acquisition
2020
2019
%
100
100
100
100
100
%
100
100
100
100
-
De Grey originally executed a detailed Share Sale Agreement (“SSA”) on 9 February 2018, to acquire all the shares in Indee
Gold Pty Ltd from Northwest Nonferrous Australia Mining Pty Ltd for a total acquisition price of $15 Million.
At the beginning of the financial reporting period, there was a remaining $12.7 Million due and payable and on 22 August
2019, settlement was completed. The final payment made consisted of $9.7M in cash and 59,065,579 shares in De Grey
(valued at $3.0M on allotment) as full and final settlement of the outstanding Contract liabilities (Note: 19).
The Group determined the transaction represented an asset acquisition, rather than a business combination, on the
assessment that the concentration test in AASB 3 Business Combinations was met. The concentration test is met if
substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar
identifiable assets. The determination of the fair values for such assets and thus both the concentration test and any
subsequent asset acquisition accounting involves the use of significant estimates and judgements. The value paid for Indee
Gold Pty Ltd was determined to be concentrated in the value of acquired exploration and evaluation assets.
When an asset acquisition does not constitute a business combination, the assets and liabilities are assigned a carrying
amount based on their relative fair values. No goodwill arises on the acquisition and transactions costs of the acquisition are
included in the capitalised cost of the asset.
56
Purchase consideration
Cash paid
59,065,579 ordinary fully paid shares at an issue price of $0.050791
Acquisition costs
Fair value on acquisition
Exploration and evaluation assets – recognised on execution of binding share sale agreement – Feb 2018
Exploration and evaluation assets – recognised on settlement of acquisition – Aug 2019 (Note 13)
Plant and equipment (Note 14)
Provision for rehabilitation (Note 20)
Net identifiable assets acquired
De Grey Mining Limited
$
12,000,000
3,000,000
442,179
15,442,179
$
15,000,000
1,451,296
13,113
(1,022,230)
15,442,179
30.
Interests in joint ventures / other acquisitions
(a) Attgold Pty Ltd Retained Pegmatite Rights across E45-2364 (a tenement within the Mallina Project)
In February 2007, De Grey acquired 100% of tenement E45-2364 on exercise of an option. Under the agreement, Attgold
retained the pegmatite related rights on this tenement only. The pegmatite rights give Attgold rights to explore on the
tenement for pegmatite minerals, which in turn are defined as “tin, tantalum, niobium, lithium, caesium and non-gold
bearing or base metal bearing aggregate.” This is subject to various clauses of priority, access and normal statutory
requirements. De Grey holds all other mineral rights in this tenement, most specifically gold and base metals and the joint
venture has a carrying value of nil.
(b) Mount Dove Iron Rights
On 22 September 2015, the company entered into a Deed of Termination with the Atlas Iron Group, where the Atlas Iron
Group relinquished its iron ore rights on any of the Turner River Project tenements. , If De Grey mines iron ore on any of its
the Turner River Project tenements it will pay the Atlas Iron Group a one-off payment of $50,000.
(c) Turner River Shingles, River Sand and Limestone Blocks Farm-Out
In October 2012 De Grey, through its wholly owned subsidiary Last Crusade Pty Ltd (“LC”), entered into an agreement with
Mobile Concreting Solutions Pty Ltd (“MCS”) under which LC facilitated the excision of graticule B703 from LC’s Exploration
Licence 45/3390. Under the agreement, MCS applied for a mining licence over the excised graticule to mine for shingles,
river sand and limestone blocks. LC retains the right to explore for all other minerals on the affected ground and MCS pays a
royalty of $0.50 per tonne to LC for all material removed. The sands mining operations commenced in the December 2013
quarter and have continued throughout the current financial year.
(d) Farno McMahon Project Option
On 28 July 2017, De Grey secured an option to enter into a joint venture for tenement E47/2502, and referred to as the Farno
McMahon Project. An option fee of $40,000 was paid to the Vendor granting De Grey an exclusive right and period to assess
the project and on 2 October 2017, the Company elected to enter into a Joint Venture Earn-in. The vendor retains all alluvial
rights. The Joint Venture Earn-in consists of two stages:
Stage 1 – During the financial year and having expended a minimum of $1.0M over the 3 year period to 13 December 2019,
the Company has earned an initial 30% interest.
Stage 2 - DEG may spend a further $1.0M expenditure over an additional 1-year period (Year 4) to earn an additional 45%
equity in the tenement for a total equity of 75%.
57
De Grey Mining Limited
(e) Vanmaris Project Option
On 25 September 2017, De Grey entered into a letter agreement with the owner of tenements E47/3399, E47/3428-3430,
P47/1732-1733 whereby De Grey may acquire an 80% interest in each of these listed tenements, within a 4 year option
period.
The terms of the letter agreement included a cash and script option payment to the vendors of $30,000 cash and 150,000
ordinary fully paid De Grey shares.
De Grey are to maintain the tenements in good standing during the 4 year option period and during which time it can elect
to acquire an 80% interest on payment of $500,000 cash. The vendor retains the alluvial and prospecting rights to a depth of
3 metres.
31.
Statement of cash flows
Reconciliation of net loss after income tax to net cash outflow from operating
activities
Net loss for the year
Non-Cash Items
Depreciation of non-current assets
Share based payments (options and performance rights)
Equity settlement of expenses
Gain on available for sale investments
Lease accounting adoption/reclassification
Change in operating assets and liabilities
(Increase)/decrease in trade, other receivables and assets
(Increase)/decrease in inventories
(Decrease)/increase in trade, other payables and provisions
Other Items
Payments to acquire or option mineral tenements
Payments for transaction costs – loans and borrowings
Payments for exploration & evaluation expenditure capitalised
Net cash outflow from operating activities
32. Loss per share
(a) Reconciliation of earnings used in calculating loss per share
Loss attributable to the owners of the company used in calculating basic and diluted
loss per share
(b) Weighted average number of shares used as the denominator
Weighted average number of ordinary shares used as the denominator in calculating
basic and diluted loss per share
Consolidated
2020
$
2019
$
(3,976,002)
(2,009,130)
336,823
650,740
-
(86,173)
13,074
334,083
(76,765)
1,824,965
-
367,752
(16,811,714)
(17,423,217)
182,117
751,744
616,964
(9,103)
-
(353,831)
8,901
239,136
10,000
150,959
(8,999,356)
(9,411,599)
2020
$
2019
$
(3,976,002)
(2,009,130)
Number of shares
959,669,364
398,278,765
(c) Information on the classification of options
As the Group has made a loss for the year ended 30 June 2020, all options on issue are considered antidilutive and have not been included
in the calculation of diluted earnings per share. These options could potentially dilute basic earnings per share in the future.
58
De Grey Mining Limited
33.
Share-based payments
From time to time options are granted to;
(i) eligible employees under the Performance Rights Plan (“PRP”) and/or the Employee Option Plan (“EOP”) of De Grey
Mining Limited to align their interests with that of the shareholders of the company.
(ii) Directors under rules comparable with the PRP and/or EOP, but subject to shareholder approval pursuant to the
provisions of the ASX Listing Rules and the Corporations Act 2001.
(a) Options
Employee Option Plan of De Grey Mining Limited (“EOP”) ¹
Shareholders last approved the EOP at the Annual General Meeting held on 28 November 2018. The EOP is designed to
attract and retain eligible employees, provide an incentive to deliver growth and value for the benefit of all Shareholders
and facilitate capital management by enabling the Company to preserve cash reserves for expenditure on principal
activities. Participation in the Plan is at the discretion of the Board and no eligible employee has a contractual right to
receive an option under the Plan.
The exercise price and expiry date for all options granted will be determined by the board prior to granting of the options,
and in the case of Director options subject to shareholder approval. The options granted may also be subject to
conditions on exercise and usually have a contractual life of two to three years. Options granted carry no dividend or
voting rights. When exercisable, each option is convertible into one ordinary share in the capital of the company with
full dividend and voting rights.
There were no director options granted (2019: 2,500,000) and 5,500,000 EOP options granted (2019: 2,250,000) in the
financial year ended 30 June 2020 and are all currently outstanding are detailed in the following table:
Grant date
Expiry date
Exercise price
Cents
Balance at start of
the year Number
Granted during the
year Number
Exercised during
the year Number
Balance at end of
the year
Number
Vested and
exercisable at end
of the year Number
2019-2020
24 Sep 2017
17 Oct 2018
12 Mar 2020
31 Oct 2020
30 May 2021
12 Mar 2022
10 cents
30 cents
35 cents
2018-2019
30 Nov 2016
24 Sep 2017
17 Oct 2018
30 Nov 2018
31 Oct 2020
30 May 2021
10 cents
10 cents
30 cents
2,250,000
4,750,000
-
7,000,000
6,100,000
2,250,000
4,750,000
8,350,000
-
-
5,500,000
5,500,000
-
-
4,750,000
4,750,000
-
(516,667)
(600,000)
(1,116,667)
2,250,000
4,233,333
4,900,000
11,383,333
2,250,000
4,233,333
4,900,000
11,383,333
(6,100,000)
-
-
(6,100,000)
-
2,250,000
4,750,000
7,000,000
-
2,250,000
4,750,000
7,000,000
Expenses arising from share-based payment transactions - options
The weighted average fair value of the options granted during the year was $0.0608 (2019: $0.0426). The price was calculated
by using the Black-Scholes European Option Pricing Model applying the following inputs:
2020
2019
Weighted average exercise price (cents)
Weighted average life of the option (years)
Weighted average underlying share price (cents)
30.0
2.6
15.0
75%
1.5%
Historical volatility has been used as the basis for determining expected share price volatility as it assumed that this is
indicative of future trends, which may not eventuate.
Weighted average risk-free interest rate
Expected share price volatility
0.25%
35.0
21.0
80%
2.0
No assumptions have been made relating to dividends or expected early exercise of the options and there are no other inputs
to the model.
59
De Grey Mining Limited
Total expenses arising from equity settled share-based payment transactions recognised during the period were as follows:
2020
$
2019
$
Options issued to directors and EOP to eligible employees
334,400
202,350
(b) Performance rights
Employee Performance Rights Plan of De Grey Mining Limited (“PRP”)
Shareholders approved the PRP at the Annual General Meeting held on 30 November 2017. The PRP, like the EOP Plan
is designed to attract and retain eligible employees, provide an incentive to deliver growth and value for the benefit of
all Shareholders and facilitate capital management by enabling the Company to preserve cash reserves for expenditure
on principal activities. Participation in the Plan is at the discretion of the Board and no eligible employee has a contractual
right to receive performance rights under the Plan.
The performance rights granted will be determined by the board prior to granting of the rights, and in the case of Director
performance rights, these are subject to shareholder approval. The rights granted may be subject to performance
milestones before the holder has the right to exercise (Refer Note 21 (d)) and can have a contractual life of up to 5 years.
Rights granted carry no dividend or voting rights. When exercisable, each right is convertible into one ordinary share in
the capital of the company with full dividend and voting rights.
There were Nil performance rights granted (2019: nil) in the financial year ended 30 June 2020 and all remained
outstanding as at the reporting date, as detailed in the following table:
Expenses arising from share-based payment transactions - performance rights
On 21 December 2017, 6,700,000 unlisted Performance Rights were issued to directors and employees of the Group, with
vesting conditions as described in Note 21(d). As at the end of the financial year only Tranche 2 remains outstanding
(1,450,000).
Number Issued (No.)
Grant Date
Exercise Price ($)
Expiry/Amortisation Date
Underlying Share Price on Grant ($)
Total Fair Value ($) – Life of Right
Tranche 1¹
Tranche 2
Tranche 3¹
Tranche 4
Tranche 5¹
1,300,000
1,300,000
1,450,000
1,450,000
1,200,000
21-Dec-2017
21-Dec-2017
21-Dec-2017 21-Dec-2017 21-Dec-2017
N/A
N/A
N/A
N/A
N/A
30-Nov-2019
30-Nov-2019
24-Jul-2019 30-Nov-2022 30-Nov-2019
$0.17
$0.17
$0.17
$0.17
$0.17
$221,000
$221,000
$246,500
$246,500
$204,000
Total Fair Value ($) – Expensed 30 June 2020
$47,624
$47,624
$10,182
$30,698
$43,961
¹ On 22 August 2019 and subsequent to the reporting date, the vesting conditions on Tranches 1, 3 and 5 had been met, with 100% of those performance
rights exercises and shares allotted.
² On 30 November 2019, the Tranche 2 performance rights expired on basis that the vesting condition, as defined in Note 22, had not been met as at that
date.
$180,089
34.
Events occurring after the reporting date
There have been no matters or circumstances occurring subsequent to the end of the financial year that has significantly
affected, or may significantly affect the operations of the Group, the result of those operations, or the state of affairs of the
Group in future financial years, other than;
• On 14 July 2020, the Company completed a placement of 19.2 Million shares at a price of $0.28 per share to raise $5.4
Million (before costs of raising). This represented the 2nd tranche of the placement announced on 28 April 2020 after
shareholder approval was received at a General Meeting held on 10 July 2020, for related parties DGO Gold Limited
(12.2 Million New Shares) and Mr. Peter Hood (1 Million New Shares) to participate.
• On 29 July 2020, the Company completed an allotment of 450,454 unlisted option, zero priced exercise and expiring 29
July 2022 (“ZEPO’s”). These were issued to directors Mr. Andrew Beckwith (163,207 ZEPO’s), Mr. Simon Lill (130,566
ZEPO’s) and Messrs Eduard Eshuys, Peter Hood and Bruce Parncutt (52,227 ZEPO’s each), after shareholder approval
was received at a General Meeting held on 10 July 2020,
60
De Grey Mining Limited
• On 18 September 2020, the Company completed a placement of 73.1 Million shares to sophisticated, professional and
institutional investors including clients of Argonaut Securities Pty Limited, Canaccord (Genuity) Limited and Bell Potter
Securities Pty Ltd at a price of $1.20 per share to raise $87.72 Million (before costs of raising). This represented the 1st
tranche of the placement announced on 14 September 2020, with the 2nd tranche of 10.3 Million shares to raise a further
$12.36 Million subject to shareholder approval of related party participation by DGO Gold Limited (12 Million New
Shares) and Mr. Peter Hood (300,000 New Shares).
• On 18 September 2020, an allotment was made of 140,846 Performance rights (“rights”) to Mr. Glenn Jardine after
shareholder approval was received at a General Meeting held on 10 July 2020, and he had completed his employment
probation period. The rights represent the long-term incentive component of Mr. Jardine’s remuneration with respect
to his first year of employment
•
Since the reporting date, a total of 9,637,047 unlisted options have been exercised, at various exercised prices
between $0.10 and $0.35, raising a total of $1,588,621.
35. Parent entity information
The following information relates to the parent entity, De Grey Mining Limited, at 30 June 2020. The information presented here has been
prepared using accounting policies consistent with those presented in Note 1.
Parent Entity
2020
$
2019
$
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Contributed equity
Reserves
Accumulated losses
Total equity
Loss for the year
Other comprehensive loss
Total comprehensive loss for the year
28,670,525
51,094,654
79,765,179
3,110,704
1,422,045
4,532,749
130,740,019
860,954
(56,368,543)
75,232,430
(3,953,338)
-
(3,953,338)
2,225,702
31,404,480
33,630,182
14,016,475
-
14,016,475
70,787,718
1,414,570
(52,588,581)
19,613,707
(2,009,130)
-
(2,009,130)
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2020 and 30 June 2019.
Capital commitments
The parent entity had no capital commitments as at 30 June 2020 and 30 June 2019.
Accounting policies
The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed in note 1.
61
De Grey Mining Limited
Director’s Declaration
In the directors’ opinion:
(a)
the financial statements and notes set out on pages 30 to 61 are in accordance with the Corporations Act 2001,
including:
(i)
(ii)
complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional
reporting requirements; and
giving a true and fair view of the company’s and the consolidated entity’s financial position as at 30 June 2020
and of their performance for the financial year ended on that date;
the audited remuneration report set out on pages 20 to 26 of the directors’ report complies with section 300A of
the Corporations Act 2001;
there are reasonable grounds to believe that the company will be able to pay its debts as and when they become
due and payable; and
(b)
(c)
Note 1 confirms that the financial statements also comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board.
The directors have been given the declarations by the chief executive officer and chief financial officer required by section
295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the directors.
Simon Lill
Executive Chairman
Perth, 30 September 2020
62
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF DE GREY MINING LIMITED
Report on the Financial Report
Opinion
We have audited the financial report of De Grey Mining Limited (“the Company”) and its controlled
entities (“the Group”), which comprises the consolidated statement of financial position as at 30 June
2020 the consolidated statement of comprehensive income, the consolidated statement of changes in
equity and the consolidated statement of cash flows for the year then ended, and notes to the financial
statements, including a summary of significant accounting policies, and the directors’ declaration.
In our opinion:
a) the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
i) giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its
financial performance for the year then ended; and
ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We have conducted our audit in accordance with Australian Auditing Standards. Our responsibilities
under those Standards are further described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report.
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our ethical requirements in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period.
These matters were addressed in the context of our audit of the financial report as a while, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key Audit Matter
How our audit addressed the key audit matter
exploration
Deferred
expenditure (refer notes 1(L) and 13)
and
evaluation
The Group operates as an exploration entity
its primary activities entail
and as such
expenditure focussed on the exploration for and
evaluation of economically viable mineral
deposits. These activities are currently limited
to the Pilbara region in Western Australia.
All exploration and evaluation expenditure
incurred during the year has been capitalised
and recognised as an asset in the Statement of
Financial Position.
The closing value of deferred exploration and
evaluation expenditure is $48,938,399 as at 30
June 2020.
The carrying value of exploration and
evaluation assets is subjective based on the
Group’s intention, and ability, to continue to
explore the asset. The carrying value may also
be affected by
results of ongoing
exploration activity indicating that the mineral
reserves and
resources may not be
commercially viable for extraction. This creates
a risk that the asset value included within the
financial statements may not be recoverable.
the
Our audit procedures included the following:
• ensuring the Group’s continued right to explore
in the relevant areas of interest including
assessing documentation such as exploration
and mining licences;
• enquiring of management and the directors as
to the Group’s intentions and strategies for
future exploration activity and
reviewing
budgets and cash flow forecasts;
• assessing the results of recent exploration
activity to determine whether there are any
indicators suggesting a potential impairment of
the carrying value of the asset;
• assessing the Group’s ability to finance the
planned exploration and evaluation activity; and
• assessing the adequacy of the disclosures
made by the Group in the financial report.
Issued capital
(refer note 21)
Our audit procedures included the following:
The Group has issued ordinary shares as a
result of capital raisings, on the exercise of
unlisted options and on
the exercise of
performance rights.
As a result of these issues the number of
ordinary shares has risen significantly during the
year.
• examining each issue of and conversion to
fully paid ordinary shares during the year as
shown in note 21; and
• assessing the adequacy of the disclosures
made by the Group in the financial report.
Share based payments – performance rights
(refer notes 21 and 33(b))
Our audit procedures included the following:
The Group awarded performance rights to key
management personnel and employees in the
2018 year.
The rights vest subject to the achievement of
specific performance milestones.
Three tranches of these rights vested during the
year and ordinary shares were issued while a
further tranche of rights lapsed prior to the
associated milestone being met.
• assessing the recognition of the value of the
performance rights;
• assessing whether the accounting treatment
for both the rights vested and exercised and
the rights which lapsed was in accordance
with the relevant accounting standard; and
• assessing the adequacy of the disclosures
made by the Group in the financial report.
Key Audit Matter
Deferred Taxation
(refer note 7)
The Company relies on the use of an expert to
prepare the taxation disclosures which are
included in the financial statements.
How our audit addressed the key audit matter
In accordance with Australian Auditing Standards,
we relied on the work of management's expert
with respect to the assumptions used in the
calculation of deferred
Our audit
taxes.
procedures included the following:
• examining the qualifications, objectivity and
experience of management's expert;
• evaluating the assumptions, methodologies
and conclusions used by
in
preparing their estimate of deferred taxes; and
the Group
• assessing the adequacy of the disclosures
made by the Group in the financial report.
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2020, but does not include the
financial report and the auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information we are required to report that fact. We have nothing to report in this regard.
Directors’ Responsibilities for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with the Australian Accounting Standards and the Corporations Act
2001 and for such internal control as the directors determine is necessary to enable the preparation of
the financial report that gives a true and fair view and is free from material misstatement, whether due
to fraud or error.
In preparing the financial report, the directors are responsible for assessing the Company’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Company or to
cease operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with the Australian Auditing Standards will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the economic decisions of users taken
on the basis of the financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
•
Identify and assess risks of material misstatement of the financial report, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
• Obtain an understanding of internal control relevant to the audit 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 Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in
our auditor’s report to the related disclosures in the financial report or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up
to the date of our auditor’s report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events in
a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain solely
responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or safeguards applied.
From the matters communicated with the directors, we determine those matters that were of most
significant in the audit of the financial report of the current period and are therefore key audit matters.
We describe these matters in our auditor’s report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh public interest benefits of such communication.
Report on the Remuneration Report
Opinion
We have audited the Remuneration Report included on pages 20 to 26 of the directors’ report for the
year ended 30 June 2020.
In our opinion, the Remuneration Report of De Grey Mining Limited, for the year ended 30 June 2020,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001.
Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted
in accordance with Australian Auditing Standards.
BUTLER SETTINERI (AUDIT) PTY LTD
LUCY P GARDNER
Director
Perth
Date: 30 September 2020
ASX Additional Information
De Grey Mining Limited
Additional information required by Australian Stock Exchange Ltd, and not shown elsewhere in this report, is as follows. The
information is current as at 9 October 2020.
(a) Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
1
1,001
5,001
10,001
100,001
-
-
-
-
1,000
5,000
10,000
100,000
and over
The number of shareholders holding
marketable parcel of shares are:
less than a
Ordinary shares
Number of holders
Number of shares
2,106
4,065
1,841
3,060
733
11,805
341
1,346,301
11,297,562
14,676,048
102,084,749
1,144,995,401
1,274,400,061
59,927
(b) Twenty largest shareholders
The names of the twenty largest holders of quoted ordinary shares are as follows:
Listed ordinary shares
Number of shares
Percentage of
ordinary shares
DGO Gold Limited
1
Citicorp Nominees Pty Limited
2
3
HSBC Custody Nominees (Australia) Limited
J P Morgan Nominees Australia Pty Limited
4
5
Northwest Nonferrous Australia Mining Pty Ltd
6
Kirkland Lake Gold Ltd
7 Mr Yi Weng & MS Ning Li
8
HSBC Custody Nominees (Australia) Limited
9 Merrill Lynch (Australia) Nominees Pty Limited
10 BNP Paribas Nominees Pty Ltd
11 National Nominees Limited
12 Mr John Henry Matterson
13 Caroline House Superannuation Fund Pty Ltd
14 Mr Andrew Rhys Jackson
15 HSBC Custody Nominees (Australia) Limited - A/C 2
16 Penand Pty Ltd
17 BNP Paribas Nominees Pty Ltd
18 Mr Raymond Wolpers & Mrs Leith Anne Wolpers
19 Nelson Enterprises Pty Ltd
20 Calliton Pty Ltd
193,577,703
188,332,323
171,345,674
85,576,596
51,015,579
35,656,084
18,971,275
17,818,291
12,044,787
11,129,979
8,960,055
8,700,000
7,941,621
7,095,000
6,851,524
4,802,181
4,785,866
3,700,000
3,312,500
3,300,000
844,917,038
68
15.19%
14.78%
13.45%
6.72%
4.00%
2.80%
1.49%
1.40%
0.95%
0.87%
0.70%
0.68%
0.62%
0.56%
0.54%
0.38%
0.38%
0.29%
0.26%
0.26%
66.30%
De Grey Mining Limited
(c) Substantial shareholders
The names of substantial shareholders who have notified the Company in accordance with section 671B of the Corporations
Act 2001 are:
DGO Gold Limited (i)
Van Eck Associates Corporation and its associates
Number of Shares
%
193,577,703
71,905,550
15.19%
5.64%
(i) DGO Ltd has confirmed its commitment to subscribe for 10 Million placement shares which will be subject to shareholder
approval at the upcoming General Meeting to be held 23 October 2020. Following that approval, its holding will move to
~15.8% of DEG’s issued shares.
(d) Unquoted (unlisted) Securities
Holders of 20% or more of the class
Class
Number of
Securities
Number
of
Holders
Holder Name
Unlisted $0.10 options, expiry 31 October 2020
Unlisted $0.30 options, expiry 31 May 2021
750,000
3,050,000
1
8
Phil Tornatora
Andrew Beckwith
Unlisted $0.35 options, expiry 12 March 2022
Unlisted $0.10 options, expiry 13 Dec 2021
Unlisted $Nil options, expiry 29 July 2022
Performance rights – Series 1
4,507,000
2,000,000
450,454
1,450,000
Performance rights – Series 2
140,846
28 Nil
1
5
Killin Investments Pty Ltd,
Andrew Beckwith
Simon Lill
Simon Lill
Andrew Beckwith
Craig Nelmes
Glenn Jardine
5
1
Number of
Securities
750,000
1,000,000
-
2,000,000
163,207
130,566
500,000
400,000
300,000
140,846
(e) Voting rights
All ordinary shares (whether fully paid or not) carry one vote per share without restriction.
The Quoted and unquoted (unlisted) options have no voting rights.
(f) Corporate Governance
De Grey Mining Ltd and its subsidiaries (“Group”) and the board are committed to achieving and demonstrating the highest
standards of corporate governance. The Group has reviewed its corporate governance practices against the Corporate
Governance Principles and Recommendations (3rd edition) published by the ASX Corporate Governance Council.
The 2020 corporate governance statement reflects the corporate governance practices in place throughout the 2020
financial year. The 2020 corporate governance statement is current as at 30 September 2020 and was approved by the board
of Directors of De Grey Mining Ltd.
A description of the group's current corporate governance practices is set out in the group's corporate governance statement
which can be viewed at www.https://degreymining.com.au/corporate-governance.
(g) Application of Funds
During the financial year, De Grey Mining Limited confirms that it has used its cash and assets (in a form readily
convertible to cash) in a manner which is consistent with the Company’s business objectives.
69
De Grey Mining Limited
Annual Mineral Resources Statement
JORC Table 1: Total Gold Mineral Resource Estimate as at March 2020 (JORC 2012) by deposit
Withnell - Mining Centre
Measured
Indicated
Inferred
Total
Au g/t
Au Oz
Mt
Au g/t
Au Oz
Deposit
Type
Withnell Open
Pit
Withnell
Underground
Mallina
Toweranna
Open Pit
Toweranna
Underground
Camel
Calvert
Roe
Dromedary
Leach Pad
Hester
Withnell Mining
Centre
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Type
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Wingina
Mt Berghaus
Amanda
Wingina Mining
Centre
Mt
0.63
0.63
1.26
0.18
0.01
0.19
0.06
0.01
0.08
0.10
1.4
1.6
1.5
28,500
33,200
61,700
2.8
2.1
2.8
2.7
2.5
2.7
2.2
16,400
600
17,000
5,500
1,000
6,500
7,200
0.10
2.2
7,200
0.98
0.66
1.63
1.8
1.7
1.8
57,500
34,800
92,300
2.68
0.40
3.08
1.8
1.6
1.7
152,100
20,500
172,700
0.36
2.68
3.05
0.11
0.11
0.71
0.90
1.61
0.62
3.71
4.33
0.32
0.14
0.46
0.43
0.56
0.99
0.13
0.07
0.20
0.03
0.03
0.06
0.86
0.86
0.04
0.01
0.06
3.49
8.23
11.72
1.2
1.9
1.8
4.3
4.3
1.3
1.2
1.2
2.4
2.1
2.1
2.6
1.4
2.2
1.3
1.3
1.3
1.5
2.3
1.8
1.6
1.6
1.6
0.7
0.7
2.1
2.1
2.1
1.5
1.9
1.8
14,400
163,500
177,800
15,600
15,600
30,200
33,900
64,100
47,700
245,500
293,200
26,800
6,500
33,300
17,900
23,800
41,700
6,000
5,300
11,300
1,400
1,700
3,200
19,300
19,300
3,000
900
3,900
166,800
496,700
0.65
0.34
0.99
0.68
0.27
0.95
0.51
0.07
0.58
1.84
0.68
2.52
1.3
1.5
1.4
1.8
1.7
1.7
1.3
1.8
1.4
1.5
1.6
1.5
27,000
16,300
43,300
38,900
14,400
53,300
21,700
4,200
25,800
87,600
34,900
122,500
70
Mt
0.15
0.53
0.68
0.00
2.38
2.39
1.68
3.47
5.15
0.24
2.21
2.46
0.56
0.56
0.04
0.14
0.19
0.05
0.23
0.28
0.11
0.21
0.33
0.04
0.08
0.12
0.03
0.05
0.07
2.35
9.87
Au g/t
Au Oz
1.1
2.2
2.0
2.5
3.9
3.9
1.3
1.5
1.5
1.6
2.1
2.1
3.6
3.6
1.1
1.8
1.7
0.8
1.2
1.2
1.6
2.2
2.0
1.6
1.8
1.7
1.3
1.4
1.4
1.4
2.4
2.2
5,300
38,000
43,300
300
301,100
301,400
72,300
171,100
243,300
12,600
152,500
166,400
64,500
64,500
1,500
8,600
10,100
1,400
9,300
10,700
5,700
14,800
20,500
2,200
4,700
6,900
1,100
2,100
3,300
102,300
766,600
870,200
Mt
1.14
3.85
4.99
0.00
2.50
2.50
2.39
4.36
6.76
0.86
5.92
6.79
0.56
0.56
0.54
0.29
0.84
0.48
0.79
1.27
0.30
0.30
0.60
0.17
0.12
0.29
0.86
0.86
0.07
0.06
0.13
6.82
18.75
25.58
Au g/t
Au Oz
1.3
1.9
1.8
2.5
3.9
3.9
1.3
1.5
1.4
2.2
2.1
2.1
3.6
3.6
2.6
1.7
2.2
1.3
1.3
1.3
1.8
2.2
2.0
1.9
1.7
1.9
0.7
0.7
1.8
1.6
1.7
1.5
2.2
2.0
48,200
234,700
282,900
300
316,700
317,100
102,500
204,900
307,400
60,300
398,000
459,600
64,500
64,500
44,700
15,700
60,400
19,300
33,100
52,400
17,200
21,100
38,300
10,800
6,400
17,200
19,300
19,300
4,100
3,100
7,200
326,600
1,298,200
1,626,100
Mt
0.34
1.08
1.42
0.99
2.40
3.39
0.89
0.56
1.44
2.21
4.04
6.25
Au g/t
Au Oz
1.3
1.7
1.6
1.1
1.2
1.2
0.9
1.1
0.9
1.1
1.3
1.2
14,400
57,400
71,700
35,800
91,800
127,600
24,700
19,200
43,900
74,900
168,400
243,200
Mt
3.67
1.82
5.49
1.67
2.67
4.34
1.40
0.63
2.03
6.74
5.12
11.86
Au g/t
Au Oz
1.6
1.6
1.6
1.4
1.2
1.3
1.0
1.2
1.1
1.5
1.4
1.4
193,500
94,200
287,700
74,700
106,300
181,000
46,300
23,300
69,700
314,500
223,800
538,400
Wingina - Mining Centre
Measured
Indicated
Inferred
Total
663,500
12.24
Au g/t
Au Oz
Mt
Au g/t
Au Oz
Mt
2.68
0.40
3.08
1.8
1.6
1.7
152,100
20,500
172,700
JORC Table 2: Total Gold Mineral Resource Estimate as at March 2020 (JORC 2012) at the by Mining Centre
Measured
Indicated
Inferred
Total
De Grey Mining Limited
Area
Type
Withnell Mining
Centre
Wingina Mining
Centre
TOTAL Pilbara
Gold Project
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Mt
0.98
0.66
1.63
2.68
0.40
3.08
3.66
1.06
4.71
Au g/t
Au Oz
Mt
Au g/t
Au Oz
1.8
1.7
1.8
1.8
1.6
1.7
1.8
1.6
1.7
57,500
34,800
92,300
152,100
20,500
172,700
209,700
55,400
3.49
8.23
11.72
1.84
0.68
2.52
5.33
8.91
265,000
14.24
1.5
1.9
1.8
1.5
1.6
1.5
1.5
1.9
1.7
Mt
2.35
9.87
166,800
496,700
663,500
12.24
87,600
34,900
122,500
254,300
531,700
786,000
2.21
4.04
6.25
4.57
13.90
18.49
Au g/t
Au Oz
Mt
Au g/t
Au Oz
1.4
2.4
2.2
1.1
1.3
1.2
1.2
2.1
1.9
102,300
766,600
870,200
74,900
168,400
243,200
177,200
935,000
1,113,500
6.82
18.75
25.58
6.74
5.12
11.86
13.56
23.87
37.44
1.5
2.2
2.0
1.5
1.4
1.4
1.5
2.0
1.8
326,600
1,298,200
1,626,100
314,500
223,800
538,400
641,200
1,522,000
2,164,500
All gold deposits are reported at a 0.5g/t Au cut-off grade except Withnell Underground (beneath Pit 33 Whittle shell) where a 2.0g/t cut-
off was applied and Wingina below -55mRL where a 1.0g/t Au cut-off was applied.
JORC Table 3: Total Base Metals Mineral Resource Estimate as at September 2019 (JORC 2012)
Deposit
Class
Discovery Massive
Sulphide
Discovery Deposit
Halo Mineralisation
Discovery Deposit
Total
Orchard
Deposit Total
Tank
Indicated
Inferred
Total
Indicated
Inferred
Total
Indicated
Inferred
Total
Indicated
Inferred
Total
Tonnes
Mt
0.27
0.35
0.61
0.15
0.63
0.78
0.41
0.98
1.39
2.08
2.08
Zn
%
5.2
5.2
5.2
0.9
1.1
1.0
3.7
2.6
2.9
3.4
3.4
Pb
%
2.4
2.1
2.2
0.5
0.5
0.5
1.7
1.0
1.2
1.4
1.4
Cu
%
0.2
0.2
0.2
0.1
0.1
0.1
0.2
0.1
0.1
0.1
0.1
Turner River Total September 2019 Base Metal Mineral Resources
De Grey Total
Class
Indicated
Inferred
Total
Tonnes
Mt
0.41
3.06
3.47
Zn
%
3.7
3.1
3.2
Pb
%
1.7
1.3
1.3
Cu
%
0.2
0.1
0.1
Au
ppm
1.9
1.3
1.5
0.9
0.6
0.6
1.6
0.8
1.0
0.7
0.7
Au
ppm
1.6
0.7
0.8
Zn
Ag
ppm Metal Tonnes
192
13,900
196
18,200
32,100
194
47
1,300
60
6,900
8,200
15,200
25,100
40,300
57
140
108
118
Pb
Cu
6,400
7,100
13,500
700
2,900
3,600
7,100
10,000
17,100
600
600
1,200
100
400
400
700
900
1,700
Au
Oz
16,300
14,100
30,400
4,300
11,700
16,000
20,600
25,800
46,400
Ag
kOz
1,600
2,200
3,800
200
1,200
1,400
1,900
3,400
5,300
105
105
70,800
70,800
28,900
28,900
2,400
2,400
45,500
45,500
7,000
7,000
Zn
Ag
ppm Metal Tonnes
15,200
140
95,800
106
111,000
110
Pb
Cu
7,100
39,000
46,100
700
3,400
4,100
Au
Oz
20,600
71,300
91,900
Ag
kOz
1,900
10,400
12,300
Discovery and Orchard Tank deposits are reported at a 0.5% Zn cut-off grade
Resources and Reserves
As at 30 June 2020, De Grey’s Group Gold Mineral Resource estimate was 37.44 million tonnes at 1.8 grams per tonne gold
for 2.164 million ounces (JORC Table 2).
Material changes to the Group’s Mineral Resource inventory have been made between the September 2019 and March 2020
estimates. Overall, the gold resources for the MGP have increased 29% and the oxide and fresh domains increased 12% and
37% respectively. The Base Metals Resource did not change.
The gold resource growth is attributed to the Withnell Mining Centre where a combined significant increase (49%) occurred
from extension drilling at the Toweranna, Withnell and Mallina deposits. At the Wingina Mining Centre, resource did not
change.
71
De Grey Mining Limited
Comparison of the September 2019 and March 2020 Gold Mineral Resources.
Measured
Indicated
Inferred
Total
Area
Type
Withnell Mining
Centre
Wingina Mining
Centre
TOTAL Pilbara
Gold Project
Oxide
Fresh
Total
Oxide
Fresh
Total
Oxide
Fresh
Total
Mt
Au g/t
Au Oz
Mt
Au g/t
Au Oz
Mt
Au g/t
Au Oz
Mt
Au g/t
Au Oz
106%
106%
106%
100%
100%
100%
102%
104%
102%
98%
98%
98%
100%
100%
100%
100%
99%
99%
4%
4%
4%
1%
2%
1%
114%
121%
119%
100%
100%
100%
109%
120%
115%
96%
88%
90%
100%
100%
100%
97%
89%
92%
10%
7%
8%
6%
7%
7%
210%
186%
190%
100%
100%
100%
137%
149%
146%
101%
106%
104%
100%
100%
100%
105%
113%
112%
112%
97%
99%
44%
68%
64%
134%
148%
144%
100%
100%
100%
115%
134%
126%
95%
99%
99%
100%
100%
100%
98%
102%
102%
28%
47%
42%
12%
37%
29%
Withnell - Mining Centre
Measured
Indicated
Inferred
Total
Au g/t
Au Oz
Mt
Au g/t
Au Oz
Mt
1.26
1.17
8%
1.5
1.5
-2%
61,700
58,300
6%
Mt
4.99
2.43
105%
2.50
2.22
13%
6.76
3.83
77%
6.79
5.33
28%
0.56
NA
0.84
0.84
1.27
1.27
0.60
0.60
0.29
0.29
0.86
0.86
0.13
0.13
Au g/t
Au Oz
1.8
1.8
0%
3.9
4.1
-4%
1.4
1.3
8%
2.1
2.1
1%
3.6
NA
2.2
2.2
1.3
1.3
2.0
2.0
1.9
1.9
0.7
0.7
1.7
1.7
282,900
137,400
106%
317,100
291,900
9%
307,400
160,700
91%
459,600
356,600
29%
64,500
NA
60,400
60,400
52,400
52,400
38,300
38,300
17,200
17,200
19,300
19,300
7,200
7,200
Mt
0.68
0.08
704%
2.39
1.55
54%
5.15
2.57
Au g/t
Au Oz
2.0
2.0
-2%
3.9
4.0
-1%
1.5
1.3
43,300
5,500
687%
301,400
197,900
52%
243,300
110,100
101%
10%
121%
2.1
1.8
14%
3.6
166,400
72,600
129%
64,500
2.46
1.23
101%
0.56
NA
0.19
0.19
0.28
0.28
0.33
0.33
0.12
0.12
0.07
0.07
12.24
6.43
90%
NA
10,100
10,100
10,700
10,700
20,500
20,500
6,900
6,900
3,300
3,300
NA
1.7
1.7
1.2
1.2
2.0
2.0
1.7
1.7
1.4
1.4
2.2
2.1
4%
Deposit
Type
Withnell
O/P
Withnell
U/G
Mallina
Toweranna
Open Pit
Toweranna
Underground
Camel
Calvert
Roe
Dromedary
Leach Pad
Hester
Withnell Mining
Centre
2020
2019
Change
2020
2019
Change
2020
2019
Change
2020
2019
Change
2020
2019
Change
2020
2019
Change
2020
2019
Change
2020
2019
Change
2020
2019
Change
2020
2019
Change
2020
2019
Change
2020
2019
Change
0.19
0.19
2.8
2.8
17,000
17,000
0.08
0.08
0.10
0.10
2.7
2.7
2.2
2.2
6,500
6,500
7,200
7,200
3.05
1.17
160%
0.11
0.67
-83%
1.61
1.26
27%
4.33
4.10
6%
0.46
0.46
0.99
0.99
0.20
0.20
0.06
0.06
0.86
0.86
0.06
0.06
1.8
2.0
-7%
4.3
4.4
-2%
1.2
1.2
-1%
2.1
2.2
-2%
2.2
2.2
1.3
1.3
1.8
1.8
1.6
1.6
0.7
0.7
2.1
2.1
1.8
1.9
177,800
73,700
141%
15,600
94,000
-83%
64,100
50,600
27%
293,200
284,000
3%
33,300
33,300
41,700
41,700
11,300
11,300
3,200
3,200
19,300
19,300
3,900
3,900
663,500
615,000
-10%
8%
72
1.63
1.54
6%
1.8
1.8
-2%
92,300
88,900
4%
11.72
9.82
19%
870,200
437,500
99%
25.58
17.79
44%
2.0
2.0
-1%
1,626,100
1,141,400
42%
De Grey Mining Limited
At Toweranna, drilling at depth has increased the total ounces from 356,600 to a combined open pit and underground
resource of 520,000 ounces. A 29% increase was attributed the open pit resource and a new underground resource was
defined as 64,500ounces.
Withnell drilling continued to target depth and lateral extensions resulting in a combined increased from 429,300 to
600,000ounces. A 106% increase was attributed the open pit resource and a 9% increase to the underground resource. A
large portion of the open pit increase was due to a larger open pit shell chosen to define the open pit resource and reflects
the increased gold price during the period.
Mallina drilling targeting both lateral and depth extensions to the mineralisation resulting in an 91% increase to 307,400
ounces from 160,700 ounces.
Mineral Resource and Ore Reserve governance and internal controls
De Grey ensures that the Mineral Resource and Ore Reserve estimates quoted are subject to governance arrangements and
internal controls activated at a site level and at the corporate level. Internal and external reviews of Mineral Resource
estimation procedures and results are carried out through a team of experience technical personnel that is comprised of
highly competent and qualified professionals. These reviews have not identified any material issues.
De Grey reports its Mineral Resources and Ore Reserves on at least an annual basis in accordance with the Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code) 2012 Edition. Competent Persons
named by De Grey are Members or Fellows of the Australasian Institute of Mining and Metallurgy and/or the Australian
Institute of Geoscientists and qualify as Competent Persons as defined in the JORC Code.
The Company’s procedures for the sample techniques and sample preparation are regularly reviewed and audited by
independent experts. Assays are performed by independent internationally accredited laboratories with a QAQC program
showing acceptable levels of accuracy and precision. The exploration assay results database is maintained and appropriate
backed-up internally. All De Grey Mineral Resource estimates have been undertaken independently by Payne Geological
Services Pty Ltd.
COMPETENT PERSON STATEMENT
The information in this Annual Mineral Resources Statement is based on, and fairly represents information and supporting
documentation prepared by Mr Paul Payne, a Competent Person who is a Fellow of the Australasian Institute of Mining and
Metallurgy. Mr Payne is a full-time employee of Payne Geological Services. Mr Payne has sufficient experience that is relevant
to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a
Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves”. Mr Payne consents to the inclusion in the report of the matters based on his information in the
form and context in which it appears.
Mr Payne has approved this Mineral Resources Statement as a whole and consents to its inclusion in the Annual Report in the
form and context in which it appears.
In relation to Mineral Resources, the Company confirms that all material assumptions and technical parameters that
underpin the relevant market announcement continue to apply and have not materially changed.
73
Schedule of Interests in Mining Tenements
De Grey Mining Limited
Project/Location
Country
Tenement
Percentage
held/earning
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Farno-McMahon
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Mallina Gold Project
Vanmaris
Vanmaris
Vanmaris
Vanmaris
Vanmaris
Vanmaris
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
E47/891
E45/2533
E45/2364
E45/2983
E45/2995
E45/3390
E45/3391
E45/3392
E45/4751
E47/3552
E47/3553
E47/3554
E47/3750
P45/3029
P47/1866
E47/2502
E47/2720
E47/3504
M47/473
M47/474
M47/475
M47/476
M47/477
M47/480
L47/164
L47/165
E47/3399
E47/3428
E47/3429
E47/3430
P47/1732
P47/1733
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
30%¹
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%²
0%²
0%²
0%²
0%²
0%²
¹ De Grey has entered into an option to joint venture agreement with Farno McMahon Pty Ltd (owned 100% by Novo Resources Corp) to
earn up to a 75% interest, and during the year earned an initial 30% interest (Note 30(d)).
² De Grey Option has an option to acquire an 80% interest from tenement holder Mr Mathew Vanmaris (Note 30(g)).
74
De Grey Mining Limited
Registered Office
Level 3, Suites 24-26, 22 Railway Road,
Subiaco WA 6008
Postal Address
PO Box 2023,
Subiaco WA 6904
Telephone: +61 8 6117 9328
Fax: +61 8 6117 9330
E-mail: admin@degreymining.com.au
Website: www.degreymining.com.au
75