Table of Contents
Corporate Information ............................................................................................... 3
Chairman’s Letter ....................................................................................................... 4
Managing Director’s Report and Review of Operations ............................................ 8
Directors’ Report ...................................................................................................... 39
Remuneration Report (Audited) .............................................................................. 47
Audit Independence Declaration ............................................................................. 69
Consolidated Statement of Comprehensive Income ............................................... 70
Consolidated Statement of Financial Position ......................................................... 71
Consolidated Statement of Changes in Equity ......................................................... 72
Consolidated Statement of Cash Flows .................................................................... 73
Notes to the Consolidated Financial Statements ..................................................... 74
Director’s Declaration ............................................................................................ 106
Audit Report ........................................................................................................... 107
ASX Additional Information .................................................................................... 111
Annual Mineral Resources and Ore Reserve Statement ........................................ 113
Schedule of Interests in Mining Tenements ........................................................... 120
De Grey Mining 2023 Annual Report | 2
Corporate Information
Directors
Simon Lill (Non-Executive Chairman)
Glenn Jardine (Managing Director)
Andrew Beckwith (Non-Executive Director)
Peter Hood AO (Lead Independent Non-Executive Director)
Paul Harvey (Independent Non-Executive Director) – appointed 4 July 2022
Emma Scotney (Independent Non-Executive Director) – appointed 9 January 2023
Eduard Eshuys (Non-Executive Director) – resigned 8 September 2022
Samantha Hogg (Independent Non-Executive Director) – resigned 17 October 2022
Bruce Parncutt AO (Non-Executive Director) – resigned 7 September 2022
Chief Financial Officer
Peter Canterbury
Company Secretary
Craig Nelmes
Registered Office and Principal
Place of Business
Ground Level
2 Kings Park Road
WEST PERTH WA 6005
Telephone: +61 (0)8 6117 9328
Email: admin@degreymining.com.au
Web: www.degreymining.com.au
Share Registry
Automic Group
Level 5
191 St Georges Terrace
Perth WA 6000
Telephone: 1300 288 664
Postal Address
PO Box 84,
West Perth WA 6872
Auditors
Ernst & Young
11 Mounts Bay Road
PERTH WA 6000
Stock Exchange Listing
Australian Securities Exchange (ASX code DEG)
Frankfurt Stock Exchange (FRA code WKN 633879)
De Grey Mining 2023 Annual Report | 3
Chairman’s Letter
Earlier on this year there was a small celebration in our office as De Grey
celebrated its 20th year as an ASX Listed Company. The inaugural
Chairman, Ron Manners, was kind enough to share some of his wisdom
with the De Grey team. Unfortunately, he was not able to be joined by
the key founding Board Member, Dennis O’Meara. Dennis was the joint
recipient with Geoff Blackburn of the AMEC Prospector Award back in
2004 for the Wingina One and Turner River Gold Discoveries on the
ground that De Grey retains. They and their fellow founding Directors
would be proud of what they commenced and the current De Grey team
have achieved. The ground that formed the De Grey IPO back in 2003
remains the ground on which Hemi was ultimately discovered in 2020.
I would like to pay tribute to them and to note that achieving a 20-year
anniversary is quite an achievement in itself given that funds regularly
dry up for junior explorers.
The achievement of a 20 year birthday is well overshadowed by the 4
year discovery anniversary of Hemi that approaches. De Grey has grown
its resources from 2.2Moz prior to discovery to 11.7Moz at our last
announced MRE. The maiden Hemi JORC Probable Reserve of 5.1Moz
@ 1.5g/t Au, is one of the largest maiden Reserves in recent times. We
expect that resource base to continue to grow and believe we have a
platform to look to a 40 year birthday in the future.
As noted, the resource growth has been achieved for the main part on
tenements that formed the Company’s IPO in 2002. There has been
some good fortune through the period, and we have added land
through Joint arrangement and acquisition, but to retain 100% of the
key tenements without external ownership nor royalty (other than
Native Title and State royalties) is also an achievement.
De Grey Mining 2023 Annual Report | 4
The scale of the Project resources demanded a very extensive drill out and during August the Company
passed the 1.1 millionth metre drilled milestone. Pleasingly we have been able to take rigs from infill,
geotech and hydrogeological drilling and recommence exploration drilling. The most recent results released
to the ASX continued to show the resource growth potential with significant depth extensions at Diucon
and Eagle and positive signs with the system moving westward towards Antwerp and at depth. We expect
resources and reserves to continue to grow.
De Grey has become uniquely identified through its Hemi discovery, comprising the Aquila, Brolga, Crow,
Diucon, Eagle and Falcon resources. We have noted some confusion (and copycatting) between the Hemi
Project and the Mallina Gold Project, with Mallina including all regional deposits. Henceforth the Company
has chosen to describe its overall Project as the Hemi Gold Project, comprising the Hemi resources as
identified above and the Hemi Regional resources – currently comprising Withnell, Toweranna, Mallina,
Wingina and Mt Berghaus.
There are some gaps in our otherwise contiguous tenement package where the Company has had to drop
off 40% of certain tenements under the WA Mining Act. This does cause frustration, having spent some
$250M on the major discovery that is Hemi. However, it is pleasing to consider our new tenement map
which now includes our interest in the Novo tenements where we are earning into some 50% of over
1,000km2 of highly prospective tenements. We thank Novo for their support in choosing us as their partner
in this exercise and we look forward to discovery success together through the 4 year earn in period.
There are other acknowledgments later in this Report, but this is a good time to congratulate and thank
Andy Beckwith who has recently resigned his Executive role and stepped into a Non-Executive role where
his skills and knowledge will thankfully be retained by the Company. Andy was instrumental in putting the
Novo transaction together, as he was with the South Western portion of our tenement package from North
West Industrial Investments in 2019.
Further – what a discovery for an exploration geologist to have on their CV! He deserves the thanks of all
shareholders for the discovery but also for putting the geological dream team together of Phil Tornatora
and Allan Kneeshaw, both of whom remain with the Company. It is pleasing to see Hemi and the three of
them continue to receive well deserved recognition through ongoing awards. They are also happily sharing
knowledge with their geological team who all remain excited about finding the next Hemi!
The key outstanding achievement of the year will not be available by the time this Report is released. The
Definitive Feasibility Study (DFS) is a major study with many moving parts for what will be one of the largest
gold operations builds in the history of gold plants. Let us also acknowledge it is being undertaken in a
difficult environment with inflationary pressures coupled by staffing shortages. Under the management and
support of Glenn Jardine, Rod Smith has led the way with the study. As Study Manager, Rod is a very calming
and knowledgeable presence at Board Meetings where he makes a complex project sound relatively easy.
He has been joined by Peter Holmes as Project Director who has previous experiences with large gold
construction builds and commissioning on behalf of Newmont and Barrick Gold in North America,
importantly including pressure oxidation circuits. We are fortunate to have secured such an excellent
appointment.
We expect the DFS to be released by the end of the September quarter. Clearly inflationary pressures will
see some adjustments relative to the Pre-Feasibility Study (PFS), but it will be a study of which De Grey and
its management and shareholders will be proud.
Another key achievement has been the execution of a Native Title Agreement with the Kariyarra Peoples
who have Native Title rights over the majority of the Company’s tenement package including Hemi. We
have reached a suitable conclusion in a collaborative fashion, and we thank the Kariyarra for their trust and
De Grey Mining 2023 Annual Report | 5
De Grey Mining 2023 Annual Report | 5
support of De Grey. We look forward to what will be a long relationship with them. I thank Bronwyn
Campbell and her team, as supported by Andy Beckwith (again!).
The Agreement with Kariyarra is a significant step in obtaining De Grey’s social license to mine. There are
other peoples across our tenement package with whom we are working towards agreements. Local shires,
pastoral owners, environment are all part of the social license, therein forming the bulk of the burgeoning
area of Sustainability. However, none of this is new and we seek to take a pragmatic approach to these
issues. The Mining Industry has always been conscious of Sustainability issues though the landscape has
changed. However, the principle of shareholder returns remains foremost. At the moment De Grey remains
very dependent upon its shareholders for ongoing development funds, and into production those
shareholders will be deserving of returns for the investment risks they have taken.
To that end we can note that we have been an outperformer on the ASX with the stock price rising from
$0.81 on 1 July 2022 to $1.35 on 30 June 2023, a rise of 66% versus the ASX All Ordinaries Index which has
risen by 10.1% in that period and the GDXJ gold index which has risen by 7.8%.
Perhaps as a result we have gathered far greater interest in our story and can now say we have a total of 8
finance houses writing research on De Grey.
The year also saw the emergence of Gold Road Resources Limited as De Grey’s major shareholder, firstly
through the takeover of former major shareholder DGO Gold and then through on market acquisition to
increase their shareholding to 19.9%. We have maintained a positive, formal relationship with Gold Road.
We thank them for their voting support at last year’s AGM and their contribution to our capital raising in
October 2022 which absolutely assisted the quality of that raising. We also thank our JLMs, Canaccord
Genuity and Argonaut for the work they did on that October raising. We acknowledge the presentation and
acceptance of a range of new shareholders, many of whom have noted their ongoing willingness to
contribute to further raisings.
The takeover of DGO Gold by Gold Road did create some challenges at Board level with DGO Gold (at the
time) having two representatives on the De Grey Board. I have previously thanked and always recognised
the contribution of Bruce Parncutt and Ed Eshuys for their time at De Grey and thank all for the professional
way that all matters were handled.
Their resignations were followed shortly thereafter by Samantha Hogg, and we thank her for her time and
efforts as well.
So, the Board transition program that commenced in 2021 is ongoing. During the year we have had 3
resignations, accompanied by two new appointments. Shareholders approved Paul Harvey’s appointment
to the Board at last year’s AGM. The Company then appointed Emma Scotney to the Board in January 2023.
It takes time to get your feet under the desk but both Emma and Paul have done so and are contributing
to the Board dynamics and the Company development very positively.
The Board, although comfortable with its current makeup, continues to review its overall skills and
requirements. Further board additions can be expected which will align with the changing needs of the
business as it transitions toward developer and ultimately producer.
Staffing issues within the Mining Industry in Western Australia remain challenging, with employment costs
continuing to increase. Staff retention has been excellent whilst we are working hard to make De Grey a go
to destination for employment. The HR team, led by Courtney Morgan-Evans, has been keeping on top of
the employment challenge.
De Grey Mining 2023 Annual Report | 6
De Grey Mining 2023 Annual Report | 6
Overseeing all these challenges is our now 3 year Managing Director,
Glenn Jardine, supported by Peter Canterbury as a Chief Financial Officer
together with other members of the teams. It is a massive task in difficult
market conditions – Study Management, drilling programs, community
engagement, internal and external culture, financing activities and
appropriately staffing the organisation. Glenn will provide greater detail
of the group’s significant organizational achievements in the Review of
Operations.
I cannot thank all individuals who have participated in the project
development to date, but the list does include all De Grey staff, both on
site and in Perth office, all contractors, pastoral holders, Traditional Owner
Groups, and local Shires.
It also necessarily includes my fellow Board Members who have worked
tirelessly on Board matters and been very supportive of myself as Chair.
Peter Hood has not been mentioned but is our Lead Independent
Director and deserves both shareholder and personal thanks for his
efforts and knowledge he brings to the Boardroom.
We exist at De Grey because of our shareholders. Their contribution by
way of capital and support always deserves recognition and respect, and
I thank them and look forward to them remaining with us as we continue
along this path to production.
Let me close by acknowledging two very good friends of De Grey in Colin
and Betty Brierly, owners of Indee Station. Hemi and most of its required
infrastructure resides on Indee though our tenement package extends
across a number of pastoral leases. They have always been supportive of
our activities. I recall meeting Colin and Betty about 6 years ago and Betty
saying to me “Great, another De Grey Chairman. We will see how long
you last!” They have always been supportive of our activities. Sadly, Betty
passed away during the year.
RIP Betty, and thanks.
Yours sincerely,
Simon Lill
Non-Executive Chairman
De Grey Mining 2023 Annual Report | 7
De Grey Mining 2023 Annual Report | 7
Managing Director’s Report
and Review of Operations
In last year’s Managing Directors report I outlined the following
objectives for the Company during the 2023 financial year.
•
•
•
•
Increase the resource base at the Hemi and Regional deposits
through extensional drilling;
Increase reserves at Hemi through targeted resource definition
drilling;
Increase production potential by conducting new pit shell
optimisations in areas where resources have been extended;
Increase the percentage of JORC Indicated mineralisation within
the open pit designs at Hemi;
• Converting Regional resources to reserves through additional
technical studies and targeted resource definition drilling;
• Pursue new discoveries through the Company's extensive and
ongoing exploration activities;
• Make environmental approval submissions;
• Assessing the potential for concurrent underground and open pit
mining;
• Complete the Definitive Feasibility Study;
• Undertake project funding discussions with the aim of providing
a funding solution for the construction of the project during
calendar year 2023; and
• De-risk the project to enable the Company to make a Financial
Investment Decision during Calendar year 2023.
I am pleased to report we have achieved, or made significant
progress, on all these objectives during the year.
De Grey Mining 2023 Annual Report | 8
It has been particularly pleasing and is testament to the world class nature of the Hemi Gold Project (HGP)
that we have also been able to implement our Strategic Workforce Plan and attract a high-quality team
capable of building and operating this Project. It is this team who will continue to drive our outperformance
in the period ahead.
Figure 1: De Grey share price performance in FY23 relative to the GDXJ Junior Gold Index and the
gold price
120.00%
100.00%
80.00%
60.00%
40.00%
20.00%
0.00%
-20.00%
-40.00%
Jul-22
Oct-22
Jan-23
Apr-23
DEG
GDXJ
Gold (USD)
Our major achievements during the last 12 months which have driven superior share price performance
compared to major gold indices and our peers (Figure 1) include:
• Release of the Pre-Feasibility Study (PFS) for the Project which included the Maiden Hemi JORC
Probable Ore Reserve of 103Mt @ 1.5g/t Au for 5.1Moz. The PFS demonstrated the world class nature
of the Project with a production rate of approximately 540,000oz per year for the first 10 years, an
AISC in the lowest quartile, a pre-tax NPV5% of $3.9 billion, a pre-tax IRR of 51% and a pre-tax
payback of 1.6 years
Significant progress on the Project DFS which is due for release in the September quarter 2023;
•
• Release of the updated Mineral Resource Estimate in June 2023 including:
o Hemi resource growth of 1.0Moz to 9.5Moz, including 6.9Moz JORC Indicated category
o Global Project Mineral Resource increased to 11.7Moz
o Global Measured & Indicated Resources growth of 1.1Moz to 8.1Moz
• Grant of Miscellaneous Licences required for Project development and application of the Hemi
•
•
Mining Lease;
Lodgement of the federal referral in May 2023 in accordance with the Environmental Protection and
Biodiversity Conservation Act 1999 (EPBC Act), followed by submission in June 2023 of referral
documentation under section 38 under Part IV of the Environmental Protection Act 1986 WA (EP Act)
Execution of a Mining Agreement (Agreement) with the Kariyarra Native Title Holders (Kariyarra
People), the most significant Traditional Owners of the lands at De Grey’s Project.
• Completion of heritage surveys by the Kariyarra People under a contemporary Cultural Heritage
Management Plan over the Project’s planned operational footprint;
• Recommencement of discovery and resource extension drilling in the June quarter 2023 after drilling
•
requirements for the DFS were completed
Expansion of our exploration footprint by 1,000km2 to 2,500km2 through the Egina Project Heads of
Agreement with Novo Resources where De Grey has the right to earn a 50% JV Interest with
management control of exploration activities for a $25M spend over four years;
• Receipt of non-binding proposals from 14 leading banks and financial institutions for the traditional
project debt funding component of an overall project development financing package. The majority
De Grey Mining 2023 Annual Report | 9
of institutions have indicated that the Project supports traditional debt funding capacity of
approximately $800 million based on the PFS;
Successful completion of a $130m Placement and $19m Share Purchase Plan to fully fund the
Company through to completion of DFS and into the early works phase; and
•
• Appointment of Mr Peter Holmes as Project Director to lead a projects team capable of building this
tier 1 asset.
The increased scale and confidence level of the Hemi resource further de-risks the DFS production
schedule. We are targeting a similar production rate to the PFS, but with greater than 95% of production
coming from reserves at Hemi alone. These targeted outcomes provide potential debt providers and
shareholders with greatly increased confidence in the forecast production from the Project.
We also see significant further upside to the Project’s production profile as we continue discovery and
resource extension drilling at Hemi, immediately surrounding Hemi and Regionally. There is tangible
potential to increase the annual gold production rate and the mine life. These opportunities include
underground mining at Hemi contemporaneous with open pit production. This is evidenced by the deeper
extensional drilling results announced in August 2023 at Eagle and Diucon. The resource at Hemi is
approximately 8.5Moz in the top 400m from surface and runs at 20,000 to 25,000 ounces per vertical metre.
Drilling below this depth is currently limited, however the potential for mineable underground resources
is clear. With most production in the DFS targeted to be generated from Hemi, it frees the Company to
consider a separate Regional concentrator centred at Withnell. The Company intends to undertake a
scoping study in 2024 targeting a minimum of 100,000 ounces per annum from Regional deposits. This
production could then also add to the Hemi open pit production schedule. A further study is also planned
for potential production from underground at Hemi.
Project Location
The Company has built a provincial scale landholding with a 1,000km2 (70%) exploration footprint increase
to 2,500km2 through the Egina Project Heads of Agreement signed in June 2023. This landholding sits in
the dominant position in the prospective Mallina Basin of the Pilbara Craton, located near Port Hedland in
the northwest of Western Australia, next to world class infrastructure which is unique in recent history in
Australia and in fact globally.
De Grey Mining 2023 Annual Report | 10
Figure 2: Hemi Deposits and Regional Deposits Location Map
The Project is located approximately 1,300 kilometres north of Perth in the Pilbara region of Western
Australia and approximately 85km by road south of the regional Pilbara hub of Port Hedland (Figure 2).
Existing infrastructure capable of servicing the Project includes:
Two two-lane bitumen highways; the North West Coastal highway and the Great Northern highway;
Two gas pipelines; the Pilbara Energy gas pipeline and the Wodgina Mine gas pipeline;
•
•
• Port Hedland to Karratha 220kV power transmission line fed separately by two gas fired power
stations located at Port Hedland and Karratha;
The port of Port Hedland, a bulk export and materials import facility;
The international airport at Port Hedland;
Existing combined mobile (cell) tower and optic fibre/wireless communications; and
Sufficient good quality groundwater at site.
•
•
•
•
Port Hedland is the largest economic export port in Australia where exports of iron ore last financial year
totalled some 780 million tonnes (in excess of A$100 billion of exports). The Port also has an operating
import terminal which is now used to receive mining equipment into the region and is undertaking an
expansion of the facility. This facility not only will provide substantial transport cost savings to the Project
during development and operations but will also reduce the execution risk for the project.
Renewable energy sources are being constructed or planned by energy providers in the Pilbara along with
an expanded high voltage distribution network (Figure 3). These initiatives will provide De Grey with the
potential to access renewable energy sources as the Project is developed and throughout operations.
The Projects’ proximity to world class infrastructure and the import terminal of Port Hedland represents
significant advantages compared with other large scale gold projects recently developed in Australia and
globally.
De Grey Mining 2023 Annual Report | 11
Figure 3: Hemi Pilbara Energy Interconnect
Prefeasibility Study
The PFS, released in September 2022 confirmed the Project to be a world class tier one gold project.
Highlights included:
• Average gold production ranging from approximately 550,000oz per annum for the first five years to
approximately 540,000oz pa over the 10-year evaluation period
• Average feed grade of 1.8g/t Au over the 10-year evaluation period
• High 97% contribution of JORC Indicated resources (Inferred 3%) over the first five years and 87%
(Inferred 13%) over the 10-year evaluation period
•
• Average AISC ranging from $1,220/oz over the first five years to $1,280/oz over the 10-year
evaluation period, placing the Project in the lowest quartile of Australian gold producing peers
Estimated capital cost for a 10Mtpa plant and site infrastructure of approximately $985M inclusive of
a $100M growth allowance
Total pre-production capital of $1,053M inclusive of $68M pre-stripping and $100M of growth
allowance
•
• Average processing recovery of approximately 93.6% is based on conventional comminution,
flotation, pressure oxidation, and CIL
• Attractive financial outcomes demonstrating the quality of the Project:
o
o
Pre-tax undiscounted free cashflow of approximately $5.9 billion (post-tax $4.2 billion) over
10 years
Pre-tax Net Present Value (NPV5%) of approximately $3.9 billion and post-tax NPV5% of $2.7
billion
Pre-tax Internal Rate of Return (IRR) of approximately 51% and post-tax IRR of 41%
o
o Unleveraged payback of approximately 1.6 years (pre-tax) and 1.8 years (post-tax)
These PFS estimates will be updated in the DFS which is scheduled for completion in late September 2023.
De Grey Mining 2023 Annual Report | 12
Exploration
The Project comprises a landholding of more than 2,500km2, including the Egina and Farno joint
arrangements with Novo Resources stretching across a contiguous tenement package running SW to NE
for 150km and boasts greater than 200km of gold hosting shear zones and numerous intrusion targets
(Figure 4). The Project area is far from being fully tested from an exploration perspective and significant
potential remains to discover new, large scale gold deposits.
Figure 4: Pilbara Gold Province showing main gold deposits and the Hemi Discovery
During the first eight months of FY23 the exploration team was focussed on the infill, geotechinal and
metallurgical drilling to support the DFS and Ore Reserve update. Also during the year significant effort was
directed at advancing regional exploration efforts targeting near surface intrusives and structurally related
mineralisation within our relatively underexplored tenement package. The majority of this early stage
regional work has focussed on re-evaluation of past exploration results and the acquistion and
interpretationof new geophysical data.
Hemi Exploration
Diucon & Eagle
Extensional results related to drilling during the year were reported in August 2023 and which were not
included in the June 2023 Mineral Resource Estimate (MRE).
Results substantially extend mineralisation by at least 250m along strike and 250m down plunge at Eagle
and by up to 800m along strike to the west at Diucon.
New diamond drilling results at Eagle (Figure 5) include:
•
•
•
26.9m @ 10.6g/t Au (including 3.5m @ 16.7g/t Au and 3m @ 54.7g/t Au), and 15.2m @ 1.9g/t Au in
HEDD192,
14.0m @ 6.0g/t Au (including 1.0m @ 73.9g/t Au) in HEDD084
37.1m @ 3.4g/t Au (including 3.9m @ 15.1g/t Au) in HEDD083
Mineralisation at Eagle remains open at depth and down plunge to the west.
De Grey Mining 2023 Annual Report | 13
Drilling along the Diucon Thrust has extended relatively shallow mineralisation up to 800m west of the
Diucon MRE, with results (Figure 6) including;
6.4m @ 2.9g/t Au in HEDD084,
19.0m @ 2.0g/t Au in HEDD085,
20.0m @ 2.2g/t Au (including 5.0m @ 5.8g/t Au) and 6.0m @ 2.9g/t Au in HEDD193
8.8m @ 4.8g/t Au (including 4.0m @ 8.9g/t Au) in HEDD225
•
•
•
•
Mineralisation at Diucon remains open at depth, along strike and down plunge to the west.
Higher grade mineralisation at Eagle and Diucon appears to be associated with inflections on major shear
zones adjacent to mineralised intrusion and include quartz veins which regularly contain visible gold (Figure
7).
This continues to demonstrate the exploration potential of Duicon for both near surface extensions and
deep high grade extensions.
Figure 5: Eagle Long Projections
De Grey Mining 2023 Annual Report | 14
Figure 6: Diucon Long Projection
Figure 7 Diucon – Visible gold
De Grey Mining 2023 Annual Report | 15
Brolga
Resource definition and extensional drilling at Brolga confirmed consistency of mineralisation and
extensional potential at Brolga which includes the Brolga starter pit.
Shallow new Resource definition results included:
•
•
50.0m @ 5.0g/t Au including 21m @ 7.5g/t Au from 37.0m in HEDD035
12.0m @ 5.4g/t Au from 72.0m including 3.0m @ 17.6g/t Au from 72.0m in HMRC311
Deeper new Resource definition results included:
•
•
38.4m @ 3.0g/t Au from 220.8m in HERC603D
37.0m @ 2.2g/t Au from 214.7 in HMRC299D
Figure 8: Brolga – Thick intercepts on S30560E
Antwerp
Exploration drilling was undertaken at Antwerp to the west of Diucon and Eagle. High-grade results included
2m @ 261g/t Au from 36m in HEAC920 and 6m @ 4.4g/t Au from 28m in HMRC197. Further drilling will be
completed at Antwerp in FY24.
Regional
In February 2023 the Company announced that a new structurally controlled gold zone had been identified
at Withnell South. These multiple new lodes, defined over 800m of strike and 200m vertical depth, provide
the opportunity to increase the existing shallow open pit Resources at Withnell. An example of this was RC
drilling which resulted in 20m @ 1.62 g/t Au from 110m and 9m @ 4.6 g/t Au from 159m in MWRC0320. In
addition, a metallurgical drill hole deliberately testing the down plunge orientation of mineralisation
encountered 155.7m @ 2.3 g/t Au from 119m in MWMT0005 including 65.0m @ 3.2g/t Au and 7.2m @
15.4g/t Au. This result shows the potential to extend mineralisation below and along strike of the existing
resource model.
De Grey Mining 2023 Annual Report | 16
Toweranna
In May 2023 the Company announced that diamond drilling for improved resource definition at Toweranna
had produced outstanding results which confirmed the current mineralisation model and indicate a likely
increase in resource ounces.
Key resource definition results include 10.0m @ 13.2g/t Au from 288m, including 2m @ 64.2g/t Au from
288m in MWDD0007 and 6.0m @ 11.3g/t Au from 216m and 5m @ 12.8g/t Au from 234m in MWDD0006.
Drilling outside of the existing resource has identified 41.5m @ 4.7g/t Au from 12m and 22m @ 1.4g/t Au
from 60m depth in MWDD003. Resource and reserve drilling will be completed at Toweranna in FY24.
Hemi Mineral Resource Update
The June 2023 MRE for Hemi is summarised below by deposit and then by the depth breakdown for open
pit (above 390m depth) and underground (below 390m depth). The relative JORC Indicated and Inferred
portions of resource growth over time are shown in Figure 9 and a plan view of the various Hemi deposits
is shown in Figure 10.
Table 1: Hemi - Mineral Resource Estimate (JORC 2012) by Deposit, June 2023
Indicated
Inferred
Total
Deposit
Mt
Au g/t
Koz
Mt
Au g/t
Koz
Mt
Au g/t
Koz
Aquila
12.7
1.5
631
7.2
Brolga
46.0
1.3
1,982
16.2
Crow
24.3
1.1
874
7.6
Diucon
37.2
1.3
1,590
17.1
Eagle
19.6
1.2
743
10.7
Falcon
26.0
1.3
1,056
12.0
1.2
1.0
1.2
1.4
1.1
1.0
283
19.9
525
62.2
288
31.9
773
54.3
371
30.2
393
37.9
1.4
1.3
1.1
1.4
1.1
1.2
913
2,507
1,162
2,363
1,114
1,449
Total Hemi
165.7
1.3
6,876
70.7
1.2
2,632
236.5
1.3
9,508
Note: 0.3g/t AU cut-off above 390m depth, 1.0g/t Au cut-off below 390m depth, assays to 7 March 2023. Differences may occur due
to rounding.
Table 2: Hemi - Mineral Resource Estimate (JORC 2012) by Depth, June 2023
Indicated
Inferred
Total
Depth
Mt
Au g/t
Koz
Mt
Au g/t
Koz
Mt
Au g/t
Koz
0 – 390m
165.2
1.3
6,856
50.5
1.0
1,661
215.8
1.2
8,517
Below 390m
0.5
1.2
20
20.2
1.5
971
20.7
1.5
991
Total Hemi
165.7
1.3
6,876
70.7
1.2
2,632
236.5
1.3
9,508
Note: 0.3g/t AU cut-off above 390m depth, 1.0g/t Au cut-off below 390m depth, assays to 7 March 2023. Differences may occur due
to rounding.
De Grey Mining 2023 Annual Report | 17
Figure 9: Five Year Hemi Gold Project Mineral Resource Growth
Figure 10: Hemi Gold deposits resources areas
De Grey Mining 2023 Annual Report | 18
Hemi Gold Project Resources
The overall global Project MRE (JORC 2012) increased 11% to 277Mt @ 1.3g/t Au for 11.7Moz during the
year. Increases have occurred mainly at Hemi, with a small increase at Toweranna. All other existing
Regional resources within the Withnell and Wingina Mining centres remain unchanged since the April 2020
MRE (except Toweranna)
Table 3: Hemi Gold Project Mineral Resource Estimate (JORC 2012) by Mining Centre
Mining Centre
Hemi Mining Centre
Withnell Mining Centre
Wingina Mining Centre
Total Hemi
Total
Au g/t
1.3
1.8
1.4
1.3
Mt
236.5
29.1
11.9
277.4
Koz
9,508
1,681
538
11,727
Table 4 – Hemi Maiden JORC Probable Reserve September 2022
Proved
Probable
Mining
Centre
Type
Mt
Au
g/t
Koz
Mt
Au g/t
Koz
Mt
Total
Au
g/t
Koz
Hemi
Mining
Centre
Oxide
Transition
Sulphide
Total
-
-
-
-
-
-
-
-
-
-
-
-
7.3
1.7
403
7.3
1.7
403
6.0
1.7
329
6.0
1.7
329
90.1
1.5
4,408
90.1
1.5
4,408
103.4
1.5
5,139
103.4
1.5
5,139
Refer to ASX Announcement 8 September 2022: “Prefeasibility Study Outcomes – Hemi Gold Project”.
Definitive Feasibility Study
Project Configuration
The Project comprises mine production, all currently from open pit mining, from Hemi and Regional
deposits. The Hemi deposits of Aquila, Brolga, Crow, Diucon, Eagle and Falcon are clustered together while
the Regional deposits are located across the Company’s tenement package. Toweranna is the most distal
Regional deposit, being located approximately 60 kilometres to the west of Hemi.
The Company assessed comminution circuit and oxidation circuit options for the process plant during the
PFS. The preferred comminution circuit comprises primary and secondary crushing, high pressure grinding
roller (HPGR) and ball mills followed by flotation, pressure oxidation (POx) and cyanide leaching. Similar
comminution circuits are currently used successfully in large scale gold projects. Hemi ore has the
advantage of generating a low (8%) mass pull sulphide concentrate as feed to the POx circuit. This reduces
the POx throughput to 0.8Mtpa compared with the overall plant throughput rate of 10Mtpa.
Hemi mineralisation achieves metallurgical recovery of 93.6% based on the detailed testwork undertaken.
De Grey Mining 2023 Annual Report | 19
Figure 11: HGP Simplified Process Flowsheet
During the year the company completed the PFS and Hemi Maiden Reserve and commenced the DFS for
the project based on the flowsheet in the PFS. At the time of writing all field studies have been completed
and various reports are being compiled.
Mining Disciplines
Geochemical and hydrogeological assessments were all completed during the reporting period.
Geotechnical assessment to provide bench configurations for pit shell optimisations, mine designs and
schedules were being completed. A detailed drill and blast assessment has commenced along with the
preparation of mining tender documentation.
Processing Disciplines
Pilot plant testwork program was undertaken, which tests the crushing, grinding, flotation, pressure
oxidation and leaching characteristics of all of the Hemi deposits within the mining schedule, The full results
will be included in the DFS, however there were no material differences in all of the tests completed thus
far between initial batch testwork on the Hemi samples that were reported on in the PFS and the current
pilot plant results.
DFS process engineer Wood Australia (“Wood”) is in the process of finalising the overall project schedule
as well as the capital and operating cost estimates. Major equipment tender packages are in the process of
being finalised. A detailed freight and logistics survey has been completed based on the equipment required
for the Project and aimed at advantaging the project as a result of its proximity to the port of Port Hedland.
De Grey Mining 2023 Annual Report | 20
Infrastructure
Multiple power supply options exist for the Project with negotiations on the preferred supply advancing. A
key component of the decision on the preferred power supplier will be determined by their respective
abilities to transition to renewable sources of power over time.
A design for the permanent village has been completed and a tender process is now underway. The airstrip
design is nearing completion with the preferred approach to be included in the DFS.
Other non-process infrastructure components will be fully reported on as part of the finalised DFS.
Sustainability – the Company’s sustainability and reporting will be included in the Sustainability
overview following this review.
Sustainability and Carbon Intensity Reduction
Wood was appointed to assess the Sustainability and Carbon Intensity Reduction requirements as part of
the DFS. This assessment has included a determination of the predicted quantum of carbon emissions for
the project across all areas and a strategy for reducing these so that a net zero target can be achieved in a
timely manner.
Environmental Studies
Lodgement of the federal referral in accordance with the Environmental Protection and Biodiversity
Conservation Act 1999 (EPBC Act) was completed in May 2023 (EPBC submission), followed by lodgement
of referral documentation under section 38 under Part IV of the Environmental Protection Act 1986 WA (EP
Act) in June 2023 (EPA submission).
A Greenhouse Gas Management Plan has been developed for the Hemi project and was submitted as
supporting information to the EPA submission assessment. This plan aligns with the EPA guidance for the
Greenhouse Gas Emissions Factor.
Heritage and Kariyarra Mining Agreement
Heritage clearances have been completed over the Project area including at Hemi and over Regional
deposits and infrastructure corridors.
In December 2022 the Company formally signed a Mining Agreement with the Kariyarra People, the most
significant Traditional Owners of the lands at the Project.
De Grey Mining 2023 Annual Report | 21
Figure 12: The Hemi Gold Project showing the lands of the Kariyarra People
The formalisation of the Agreement is a result of the Company and Kariyarra People working closely
together over several years throughout the exploration and studies phase of the Project. This has included
the completion of many heritage surveys to support drilling activities and the development of the
Agreement.
The Agreement will provide pathways for employment, training and contracting for the Kariyarra People
alongside the development of Hemi, as well as educational opportunities for young people.
A Cultural Heritage Management Protocol is included in the Agreement which will ensure future
development and operations at Hemi will minimise/avoid impact to Kariyarra cultural heritage. This includes
the establishment of a Kariyarra-led ranger program to support Aboriginal cultural heritage on Kariyarra
lands. The ranger program will ensure development of important land management processes and
procedures enabling both parties to care for country in culturally sensitive ways whilst also sharing
environmental knowledge and learnings.
De Grey Mining 2023 Annual Report | 22
Review of Objectives
FY23 Objective
Status
Outcome
Increase the resource base at the
Hemi and Regional deposits through
extensional drilling
Increase reserves at Hemi through
targeted resource definition drilling
Increase production potential by
conducting new pit shell optimisations
in areas where resources have been
extended
Increase the percentage of JORC
Indicated mineralisation within the
open pit designs at Hemi
Converting Regional resources to
reserves through additional technical
studies and targeted resource
definition drilling
Pursue new discoveries through the
Company's extensive and ongoing
exploration activities
– Achieved –
– An increased
reserve targeting
6Moz will be
announced with
the DFS –
– Achieved –
– Achieved –
– Project studies
progressing–
Updated 9.5Moz Hemi JORC code
compliant MRE announced in June 2023
takes total HGP resources to 11.7Moz
Infill drilling complete and MRE
announced included 8.1Moz in Measured
and Indicated and over 6Moz in Indicated
resource within Hemi pit shells
The Hemi MRE update in June 2023
showed pit shell optimisations with over
6Moz in Hemi open pit optimisation
The Hemi MRE update in June 2023
showed pit shell optimisations with over
6Moz in Hemi open pit optimisation
Metallurgical and geotechnical studies at
Withnell and Toweranna completed to
progress the conversion of Resources into
Reserves
– Achieved –
Discoveries at Charity Well and Withnell
South
Make environmental approval
submissions
– Achieved –
EPBC and EPA submissions made May &
June respectively
Assessing the potential for concurrent
underground and open pit mining
Complete the DFS for the HGP
– Conceptual
studies
commenced –
– DFS scheduled
for completion in
the September
quarter –
Sufficient drilling at Diucon and Eagle to
demonstrate that high grade underground
potential exists and enough to undertake
additional drilling to support a concept
study on underground
All drilling and testwork complete for the
DFS as well as MRE update completed to
support pit shell optimisations for the DFS.
Undertake project funding discussions
with the aim of providing a funding
solution for the construction of the
project during calendar year 2023
– Achieved –
EOI process undertaken with 14 banks and
received strong support of approx. $800M
debt. Will be updated following DFS.
De-risk the project to enable the
Company to make a Financial
Investment Decision during Calendar
year 2023
– Investment
decisions to follow
the DFS –
Completion of the DFS and Credit
Approved Term Sheets will provide the
framework for FID however timing may be
in early 2024
De Grey Mining 2023 Annual Report | 23
Building Organisational Capability
The Company has a firm commitment to build its organisational capability to take the Project from the
exploration/studies phase, through development and into production. During the year the Company
commenced the strategic hires for the Project to achieve this pathway. This is seen as a major de-risking
event so as to build in house capability to execute project construction and commissioning and then into
operations.
In February 2023 Mr Peter Holmes was appointed Project Director. Peter is a highly experienced project
development, operational readiness, and corporate mining executive with over 30 years of experience in
the gold mining industry including with Barrick Gold Corporation (Barrick) and prior to that with Placer
Dome Asia Pacific (Placer). He has worked across various jurisdictions including Australia, Canada, United
States and South America.
Peter’s previous roles include Senior Director of Project Execution for Barrick where he oversaw
approximately $9 billion in construction projects. The role encompassed the completion and handover of
the Pueblo Viejo gold project, one of the world’s largest pressure oxidation plants, located in the Dominican
Republic. Other previous roles include Senior Director – Construction and Corporate Manager – Projects
for Barrick and Corporate Manager – Project Management for Placer. Peter has more recently worked as
Studies Director for SolGold on its Cascabel project in Ecuador.
In house expertise in metallurgy, mining, hydrology, and procurement/contracts have been added to the
project team under Mr Holmes to support the upcoming development.
I have been extremely impressed with the skill, dedication, and commitment of our people and the
teamwork displayed in managing a dynamic, world class project. I must say a special thanks to Andy
Beckwith who has recently transitioned from Technical Executive Director to a Non-Executive Director role.
Andy has worked tirelessly for the Company for over 6 years and is one of the three key people responsible
for making the Hemi discovery.
It is a pleasure to continue to lead such an exceptional team at De Grey and together we are aiming to
achieve the following objectives in FY2024:
• Completion and release of the DFS including an updated reserve capable of supporting a minimum
production rate of over 500,000ozpa;
Increase near surface and depth extensions at Hemi through targeted resource definition drilling;
•
• Continue to grow resources at the Project outside of Hemi;
• Progress regional exploration to support a potential western regional concentrator plant including
•
the recently acquired exploration rights on the Egina JV earn in with Novo Resources;
Increase production potential by undertaking conceptual studies for underground mining at Hemi as
well as the western regional concentrator;
• Progress environmental approvals to complete the Project approval process;
• Complete detailed engineering and begin early works and construction activities; and
•
Finalise Credit Approved term sheets with banks at a level capable of funding the development of
Hemi and allow for FID.
I look forward to keeping you updated on our progress.
Glenn Jardine
Managing Director
De Grey Mining 2023 Annual Report | 24
Sustainability Report
Statement from the Sustainability Committee Chair, Paul Harvey
At De Grey we are committed to operating ethically and sustainably in every aspect of
our business as we advance and grow the tremendous potential of our Tier 1 asset – the
Hemi Gold Project (formerly referred to as the Mallina Gold Project). This report brings
together the focus and achievements of our team this year and outlines our plans for
2024 and beyond.
Core to our strategy is a belief that integration of environmental, social and governance
(ESG) principles in how we think and operate, is critical to the success of the business.
As a company in its exploration and development phase, we are in a unique position to
embed sustainable development practices across all aspects of the company. Our
Definitive Feasibility Study, set for release in the September 2023 quarter, is a great
example of where the team are building our ESG commitments into the very heart of
this great project. From mine fleet selection and water management to supplier
procurement and mine closure planning, the approach we are taking will ensure that
sustainable and practical risk-based decisions are made from the outset.
We firmly believe that sustainability starts with a strong governance framework. Guided
by our values, we follow rigorous standards of honesty and integrity. We have an active
Sustainability Committee and an ESG Policy in place to build oversight and
accountability. Central to this and paramount to building a successful and sustainable
business is paving the way for a diverse and equitable workforce and management team.
We are therefore pleased to report that we have grown the number of women in
management roles to 30%, representing a 7% increase from the previous year in
addition to increasing our overall female diversity to 32%.
This year we took some important steps along our sustainability roadmap. We
completed our first materiality assessment to prioritise our material topics and establish
baseline data against metrics drawn from leading global sustainability standards. The 10
topics in this report are informed by our business strategy and the issues of importance
raised by our stakeholders. They bring a new level of transparency to our sustainability
reporting.
De Grey Mining 2023 Annual Report | 25
The relationships that we have with Traditional Owner communities are of critical
importance and fundamental to De Grey as a business - the Kariyarra, Nyamal, Ngarla
and Ngarluma people of the Pilbara, and the Whadjuk Noongar people of Perth. A
significant milestone was reached this year with the signing of a Native Title Mining
Agreement with the Kariyarra people which not only provides for employment, training,
and contracting opportunities, but also the development of the Kariyarra Ranger
program in FY24 to support cultural heritage and land management.
We also built on our existing relationships with local stakeholders and communities in
the central Pilbara, through our partnership with Mission Australia’s Family and
Domestic Violence Outreach Program, establishment of a local business register and
rollout of a community grievance mechanism.
One of our core Values is to ‘Ensure everyone goes home safely’. We want everyone to
speak up about safety and to feel confident and secure in their work environment. Our
focus this year has continued to enhance the systems and resources needed to help
bring this value to reality and includes fatality risk management programs, incident and
hazard reporting, crisis and emergency response preparedness and
learning
management systems and broad-based team wellbeing. Moreover, we are pleased to
report a 63.37% reduction in Total Recordable Injury Frequency Rate (TRIFR) compared
to the previous year.
We also continued to advance our knowledge and understanding of the environmental
values within the Hemi Gold Project area with over 30,000 ha of baseline biodiversity
studies completed to inform our Federal and State environmental approval applications
that were submitted during FY23. The applications were also supported by one of the
first Greenhouse Gas (GHG) Management Plans to be prepared in line with the WA
Environmental Protection Authority’s GHG Guidelines that were released in April 2023.
The GHG Management Plan delineates how De Grey proposes to reduce its carbon
emissions over the life of the project.
As we move towards development of the Hemi Gold Project a strong and ever-present
commitment to excellence in our ESG performance lies at the foundation of our path
forward. I would like to thank all the members of our team who continue to demonstrate
the passion for doing things right, and who demonstrate De Grey’s determination to
play our role as responsible environmental and social stewards. We look forward to
sharing our ESG progress with you in this report.
Paul Harvey
Sustainability Committee Chair, De Grey Mining Board
De Grey Mining 2023 Annual Report | 26
Our Approach to Sustainability
At De Grey Mining, we are committed to operating ethically, sustainably, and
in accordance with best governance practices.
Our overarching sustainability framework underpins our commitment to undertake business in a manner
consistent with the principles of intergenerational equity, environmental responsibility, and ethical practice.
To guide implementation of our framework and monitor performance, De Grey’s Board resolved to adopt
the International Council of Mining and Metals (ICMM) Mining Principles (ICMM 2022) which are aligned
with the United Nations Sustainable Development Goals (SDGs).
These frameworks have been integrated with our ESG pillars as displayed in Table 1.
Table 1: Sustainability Framework Integration
De Grey Mining 2023 Annual Report | 27
In FY21, the Board resolved to adopt the recommendations from the Task Force on Climate-Related Financial
Disclosures (TCFD 2017). The core elements of governance, strategy, risk management, and adoption of
metrics and targets have been embedded in our approach to climate-related planning and along with other
elements of ESG, have been central to development of the Hemi Gold Project. We understand the
importance of climate change risks on our planned operations and are committed to the energy transition
and working towards net zero emissions by 2050.
This Sustainability Report should be read in conjunction with the financial information within this Annual
Report as well as the separately released 2023 Corporate Governance Statement. This report does not
constitute an audit of De Grey’s performance against ICMM Principles or TCFD Recommendations. However,
De Grey undertakes an annual gap analysis against these frameworks which provides guidance and actions
for De Grey to focus on with the aim of continually improving its ESG performance.
De Grey Mining 2023 Annual Report | 28
Determining Materiality
The Process
De Grey formed a project team with representatives from the Executive and Board to undertake its first
materiality assessment in FY23. The team identified and prioritised the topics thought to have the greatest
material impact on stakeholders and operations, ensuring they aligned with De Grey’s strategic focus and
reporting obligations.
The project team rated each material topic via an online questionnaire, with the remaining De Grey executive
team approving the assessment results. De Grey will undertake an annual review of the material topics with
a plan to conduct an extensive materiality survey with stakeholders in the next financial year.
FY23 Material Topics
The top 10 material topics as rated by the De Grey project team are summarised below with further detail
provided throughout the FY23 Sustainability Report. Cyber Security and Data Management was identified
as a broader topic and incorporated into Risk Management.
Environment
Social
Governance
• Water
• Emissions & Energy
• Biodiversity
• Health, Safety & Wellbeing
• Aboriginal Engagement
• Talent Attraction,
• Corporate Governance,
Compliance & Business
Ethics
Development & Retention
• Communities & Stakeholder
• Risk Management
• Diversity & Inclusion
Engagement
De Grey Mining 2023 Annual Report | 29
Environment
At De Grey, we strive for continual improvement in our environmental
performance, implementing measures to reduce the impact of operations and
remediate any effects in accordance with best practice.
✓ Detailed water assessments completed.
✓
Continued implementation of Environmental Management System including
Exploration Environmental MP, Fauna Management MP and Ground
Disturbance Procedure.
✓ Over 30,000ha of land surveyed for biodiversity values.
Water
De Grey has continued to study the groundwater aquifers at the Hemi Gold Project to prepare a
groundwater model domain of 1,520km2. De Grey expects Hemi will have surplus water in the early stages
of project development until processing demand approaches or exceeds dewatering rates. Consequently,
an important part of our definitive feasibility study has been to define a water management program that
strives to protect beneficial water users in the vicinity of our project.
Surface water studies have also continued to progress across the Project areas. Hemi is situated on a
relatively flat plain between the Yule and Turner Rivers. De Grey recognises the high ecological, cultural and
community importance of the Yule River and has designed the Hemi Gold Project to minimise the potential
for impacts to the Yule River.
During FY23, 56,585 KL of groundwater was abstracted for exploration and domestic use in line with
groundwater licences. Our significant baseline groundwater monitoring program continues to be
undertaken on a monthly basis and during FY24, we are planning to expand our surface water and
groundwater monitoring network to further enhance our understanding of water resources in the Project
area.
De Grey Mining 2023 Annual Re
De Grey Mining 2023 Annual Report | 30
Emissions and Energy
De Grey’s emissions for FY23 largely comprise of scope 1 emissions from diesel use for exploration activities
and village power supply, with minor scope 2 emissions from power supply to company offices.
Type
Scope 1 emissions
Scope 2 emissions
Energy consumption
Amount
3,923.45 tCO2-e
41.2 tCO2-e
5,267 GJ
Energy efficiency is inherent in the development of project design to minimise both cost and greenhouse
gas emissions, informing the selection of design options including renewable power sources and process
flow sheets. We recognise the opportunities for low-carbon power supply either via the local main grid or
an onsite micro-grid.
A Greenhouse Gas Management Plan was developed to support our environmental approval application in
June 2023, one of the first under the new Environmental Protection Authority Greenhouse Gas Guidelines
released in April 2023. The Plan describes the strategy of the Hemi Gold Project to achieve a trajectory to
net zero by 2050 in line with WA Government commitments and is well below other Australian gold
producers’ FY 2021 benchmark.
During FY23, the definitive feasibility study progressed which included analysis of feasible decarbonisation
strategies for the Project as well as the development of a decarbonisation plan.
Biodiversity
Hemi Gold Project is located in the Chichester bioregion, characterised by an area of basaltic ranges and
low plains covered with hummock grasslands, shrub steppe and tree steppe. During FY23 we conducted
extensive environmental studies with over 30,000 ha assessed for ecological values over the Hemi Gold
Project with studies continuing over the regional project areas.
We are committed to reducing our impact on biodiversity values of conservation significance and have
introduced measures such as exclusion of the Priority Ecological Community, Yule River, and critical
Northern Quoll habitat from the Hemi project area. As part of our environmental approval applications, we
have prepared a fauna management plan that aims to ensure the protection, management and monitoring
of conservation significant species that have the potential to occur in the area.
As we continue to deliver our Environmental Management System (EMS) across the business, during FY23
we successfully rolled out an Exploration Environmental Management Plan, Hydrocarbon Management Plan,
Waste Management Plan, Weed Management and Hygiene System and Ground Disturbance Permit.
De Grey intends that all proposed mining activities are rehabilitated and closed in a manner to make them
physically safe to humans and animals, geo-technically stable, geo-chemically non-polluting/non-
contaminating, and capable of sustaining an agreed post-mining land use, and without unacceptable
liability to the State. As part of our environmental approval applications, we have prepared a conceptual
mine closure plan that we intend to refine during the life of the project, to ensure the sustainable closure
of our operations in the future.
During FY23, 257 ha of rehabilitation of exploration disturbance was completed, reducing our rehabilitation
liability estimate. We will continue to develop and implement appropriate management plans and
procedures from our EMS into FY24.
De Grey Mining 2023 Annual Re
De Grey Mining 2023 Annual Report | 31
Social
We acknowledge the Traditional Custodians of the land upon which we
operate, the Kariyarra, Ngarluma, Nyamal, and Ngarla peoples.
We strive to be an employer of choice upholding our values to create a
supportive work environment. We are determined to be a leader in safety
ensuring everyone goes home safely.
✓ Mining Agreement with Kariyarra People signed.
✓
Approximately 50,000ha of ethnographic and 16,400ha of archaeological surveys
completed since 2018.
63% reduction in TRIFR and 47% reduction in RIFR from previous year.
✓
Health, Safety and Wellbeing
Health, Safety, and wellbeing is a core component of De Grey’s ESPRIT Core Values (Empathy, Safety,
Personal Responsibility, Respect at all Levels, Integrity and Thinking Differently). To realise these values, we
have developed a Workplace Health and Safety Management System that aligns with ISO45001 and
evaluated our Legal Obligations under the WHS Act 2020 and Regulations 2022 to shape our safe system
of work (SSOW) and Mine Safety Management System for Operational Sites. The SSOW follow the Plan-Do-
Check-Act (PDCA) approach and embeds continuous improvement to promote a safe and healthy work
environment for everyone.
In particular, we have developed specific programs to identify and control activities which have a fatality
risk potential, implemented training and wellbeing programs and developed capability within our crisis and
emergency preparedness and response teams. We are also promoting a culture of awareness and actively
encourage all our team to speak out about health, safety and wellbeing risks and hazards. To support this,
we have established several initiatives to enhance safety performance through the implementation of:
The De Grey Lifesaving Behaviours Program
•
• Health, safety, and wellbeing awareness training sessions to promote a culture of safety and to ensure
all employees understand potential hazards and safe work practices.
• Crisis and emergency preparedness and response training, including the testing of management
plans both in mock exercises and actual events, such as seasonal cyclone events.
• A De Grey HR and Learning Management System and associated training.
De Grey Mining 2023 Annual Re
De Grey Mining 2023 Annual Report | 32
We are very pleased to report that there were no fatalities or major safety incidents in FY23. There was one
lost time injury and three total recordable injuries across our employee and contractor workforce and 31
first aid injuries. This performance has resulted in a 47% decrease in the Reportable Injury Frequency Rate
and a 63% reduction in the Total Recordable Injury Frequency Rate from the previous year.
We are committed to supporting the mental health of our workforce. During the year, we added several
components to our developing wellbeing strategy beyond our existing Employee Assistance Program. This
has included:
•
The Resourceful Minds Program, delivered by Lifeline, which provides resources and strategies to
promote a healthy work-life balance;
• RUOK Day sessions through workforce engagement;
•
Feedback surveys to help emphasise the importance of employee wellbeing and communication, and
• Participation in the inaugural Thrive at Work Masterclass, a collaborative initiative by Curtin University,
MARS (Mental Awareness, Respect and Safety) and DMIRS (Department of Mines, Industry Regulation
and Safety). This program developed an industry toolkit to address the emerging challenges related
to psychosocial risks, mental health, and overall well-being in the workplace
A Psychosocial Hazards at Work and Mental Health and Wellbeing Strategy are both currently in
development and will be rolled out in FY24.
Aboriginal Engagement
The Hemi Gold Project is located on Kariyarra Native Title determination (National Native Title Tribunal
Number WCD2018/015) and is home to places of special significance to the Kariyarra People. We were
delighted to sign a Native Title Mining Agreement on 16 December 2022 with the Kariyarra People. This
agreement includes the development of a Cultural Heritage Management Protocol and Project-specific
Cultural Heritage Management Plan for Hemi.
This year, De Grey has completed approximately 6,500 ha of archaeological surveys and approximately
31,200 ha of ethnographic surveys across the Hemi Gold Project. The surveys have allowed De Grey workers
to learn more about the land and cultural practices of the Kariyarra People.
On 1 September 2022, De Grey hosted a full-day on-country Yintha Ngurrara (Elders and Knowledge
Holders) meeting at the Project site and exploration camp. The entire delegation spent time on country
discussing the proposed Hemi Project Layout, sharing heritage values and places of importance including
the sand dune that was subsequently removed from the Project area.
De Grey continually engages with Kariyarra Aboriginal Corporation (KAC) and the Kariyarra People through
heritage surveys, ad hoc meetings with staff, community events and regular attendance at KAC Board
meetings.
De Grey believes the Native Title Mining Agreement will deliver outstanding outcomes for Kariyarra people
and the broader community and has developed an ongoing survey plan with the Kariyarra People for FY24
and beyond.
Talent Attraction, Development and Retention
We continue to strive to be an employer of choice attracting, engaging, and retaining a highly skilled and
committed team. We are focused on providing employment, skills and training opportunities and creating
an environment based on upholding our values by striving to maintain a supportive and inclusive workplace.
De Grey Mining 2023 Annual Re
De Grey Mining 2023 Annual Report | 33
We made significant improvements to our recruitment procedures including opportunities for a diverse
range of candidates and identifying prospective employees through our employee referral plan. We
recruited an additional 40 team members to the De Grey team during FY23.
Highlights include:
• Conducted our second Employee Engagement Survey with an overall increase in engagement up 5%
from the previous year.
• Commencement of succession planning and talent management program.
• Addition of employee development plans to performance reviews, strategic workforce planning
process development, redeployment plans, out-of-cycle, Executive and Board annual remuneration
reviews.
• Advertisement of vacancies internally to afford existing team members an opportunity to apply for
roles before externally advertised.
• Review of site-based rosters to ensure a more family friendly rotation and an improvement to work-
life balance.
Implementation of an Annual retention plan to recognise service of employees.
•
FY23 Employment Engagement Survey Results:
✓
✓
✓
Felt they were provided with equal opportunities to succeed.
Felt comfortable sharing opinions and reporting unethical conduct.
Had a good understanding of company values and behavioural standards.
The ‘Living the Values’ Award was also launched during FY23 with all employees encouraged to participate
and nominate their colleagues. The award recognises a nominated team member for living, embodying,
and displaying the expected Company values.
Communities and Stakeholder Engagement
A community relations plan to carry out a program of stakeholder engagement in the Pilbara has been
established and is presented in Table 2. The plan incorporates local communities, landholders, government
bodies, and other operations.
Stakeholder
Investors
Customers
Contractors, suppliers and
service providers
Employees
Local Community
Table 2: Stakeholder Engagement
Topics
Means of Engagement
•
•
•
•
•
•
•
Return on financial, social,
and environmental
investment and equity
Allocation of risk and capital
Safe and reliable product
Impacts of supply chain
Productive relationships
Local business register
•
•
Reporting
ASX announcements & investor
briefing
• Direct engagement
Reporting
•
• Direct engagement
Reporting
•
• Direct engagement
Safe, healthy, and inclusive
workplace
•
•
• Development and training
•
•
•
•
opportunities
Creating a culture where
values are lived by the
workforce
Social investment with local
community
Local business register
Project and business
updates
Reporting
Training and development
programs
Regular performance reviews
•
• Direct engagement and
consultation
Town Hall meetings
•
• Monthly newsletter
•
Social media and updates
De Grey Mining 2023 Annual Re
De Grey Mining 2023 Annual Report | 34
Stakeholder
Topics
Means of Engagement
Native Title Groups
Pastoral Leaseholders
Local Government
Authority
•
Protection of cultural
heritage
• Native Title Mining
•
•
•
Agreement
Indigenous employment
and opportunities
Protection of the
environment and natural
resources
Access to pastoral land and
potential impacts to
pastoral infrastructure
•
Compliance with local
government regulations
• Use of public infrastructure
•
Community engagement
and development
Land access and tenure
Mining and Environmental
Regulators
Interest
Groups/NGOs/Education
Institutions
•
•
•
•
•
•
•
Environmental and social
values
Compliance with regulations
Environmental approval
submissions
Protection of environmental
and cultural values
Community development
Employment opportunities
•
•
•
Reporting
Ethnographic and Archaeological
Aboriginal cultural heritage
assessments
Regular engagement and
consultation
• Direct engagement including
meetings and correspondence.
Access and mining agreements
•
Reporting
•
• Meetings and correspondence
Reporting
•
• Meetings and correspondence on
Project approvals
Environmental impact
assessments
Site inspections
•
•
Reporting
•
• Direct consultation
•
Research and collaboration
Our social investment partnership continued into FY23 with the Mission Australia Family and Domestic
Violence Outreach Program continuing for its third and final year. The program has been instrumental in
supporting victims of family and domestic abuse to create safety plans and access the support they require.
A new partnership will be announced in coming months.
We continued to build our local business register to capture businesses across Port Hedland and the Pilbara.
The register forms a database of local businesses that can be utilised throughout construction and into
production of the Hemi Gold Project.
An External Complaints and Grievances Procedure has been developed outlining the procedure to manage
external complaints and grievances ensuring a fair and transparent process. Lines of communication to be
raised include email (listed on the company website), office established in the Town of Port Hedland and
through community engagements such as Town Hall meetings. No formal complaints were received by
community members during FY23.
Stakeholder engagement activity for FY23 includes:
21 regular formal engagement events
25 informal engagement events
62 formal meetings
69 informal meetings
✓
✓
✓
✓
De Grey Mining 2023 Annual Re
De Grey Mining 2023 Annual Report | 35
Governance
De Grey is committed to behaving ethically and ensuring inclusion across the
organisation, regardless of gender, marital or family status, sexual
orientation, gender identity, age, disabilities, ethnicity, religious beliefs,
cultural background, socio-economic background, perspective, and
experience.
✓ No legal or corporate breaches in FY23.
✓ Development and implementation of IT and cyber security policies.
✓
An increase in female employees to 32%, well above our industry average.
Corporate Governance, Compliance and Business Ethics
The De Grey Board charter assigns responsibility to the Board for overseeing the Company’s commitment
to health and safety, the environment, and sustainable development. The charter also enables the ratifying
of systems for risk management and internal control, and for ensuring that effective corporate governance
policies are in place.
De Grey's Corporate Governance manual provides a system of control and accountability to administer
corporate governance. Our Board is committed to these policies and procedures to achieve our vision in a
proper and ethical manner. Our Code of Conduct, together with our Values Statement, outlines our
responsible conduct with stakeholders and employees. We also have policies in place to address specific
areas of the business, including an ESG Policy, Anti-Bribery and Corruption Policy, Diversity & Inclusion
Policy, Modern Slavery and Human Right Policy and Code of Conduct for Directors and Executives Policy.
All policies are published on the company website.
De Grey proactively ensures compliance with its legal and regulatory obligations with regulatory oversight
provided by the Board through the Audit and Risk Management Committee. The Company recorded no
legal or corporate breaches in FY23.
De Grey Mining 2023 Annual Re
De Grey Mining 2023 Annual Report | 36
Risk Management
De Grey has a risk management framework overseen by a Board Audit and Risk Committee. This committee
monitors and reviews company systems for risk management, ensures that a risk register is maintained and
periodically reviewed, and that it addresses enterprise and operational risks.
Failure to secure data could have serious operational, financial, and reputational consequences for De Grey.
In FY23 there were two cyber breach attempts that were immediately identified by our security software
and staff and remediated by our IT Department. No data was compromised through cyber breaches during
FY23, and no fines related to IT breaches were incurred.
In addition to the development of new IT and cyber security policies, De Grey is implementing several
solutions to strengthen the Company’s network security and align us with industry best practice. We have
expanded our cyber detection system and systems engineering team to implement a new standardised
network design to ensure that data is protected.
De Grey commissioned an initial assessment of climate-related risks and opportunities to inform the
development of a climate change strategy. This initial assessment will consider the recommendations of the
Task Force for Climate-related Financial Disclosures to identify risks and opportunities for De Grey. This will
support future disclosures to lenders, equity markets, and other stakeholders. The team continue to monitor
developments with respect to the likelihood of the Australian Federal Government introducing mandatory
reporting of financial disclosures related to climate risks and opportunities.
In an important step to de-risk the Project, submissions under State and Commonwealth environmental
regulations were lodged for the Hemi Gold Project in FY23. Decisions to determine the level of assessment
are expected in FY24. Applications were supported by detailed environmental impact assessment in
accordance with the relevant regulatory guidelines.
Diversity and Inclusion
Actively advancing inclusion and diversity are at the forefront of our sustainable business strategies across
all levels of the corporation. We actively aim to create an equal opportunity environment by attracting and
retaining team members with a focus on diversity, equity, and inclusion, which has positively impacted the
Company's performance and culture.
At the end of the financial year, the proportion of female participation had grown to 32% across the
workforce, which was proportionately above the industry average of 18% (WGEA, Metal Ore Mining). In
FY23, the proportion of women in management positions was 30%, which reflected an increase of 7%
compared to the end of FY22. The representation of women was further strengthened within the Company
through the appointment of a female Non-Executive Director, contributing to De Grey’s Board diversity
commitment of 30%. We undertook a review of the Company's recruitment processes to remove any
underlying gender bias, support diversity and inclusion, and revise gender pay equity on an annual basis.
We are also focused on continuing to build diversity targets with the Kariyarra Traditional Owners.
De Grey Mining 2023 Annual Re
De Grey Mining 2023 Annual Report | 37
Looking Forward
At De Grey, we are committed to ensuring ESG is embedded into all aspects of Project development and
will continue to align our sustainability actions against ICMM principles and TCFD recommendations.
Throughout FY24, the Sustainability Committee will be undertaking a review of sustainability frameworks
such as the Global Reporting Initiative (GRI) and Sustainability Accounting Standards Board (SASB)
frameworks, to guide our Strategy and with respect to future data management and reporting as the
business continues to grow and move through its development phases.
During FY24, we will continue to focus on the development of important Sustainability focused programs
such as the Kariyarra Ranger Program, monitoring and management programs associated with the
Environmental Management System, and the continued rollout of the Work Health and Safety Management
System. We look forward to providing updates of our key achievements in Sustainability as we progress
through FY24.
De Grey Mining 2023 Annual Report | 38
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 2023.
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
Andrew Beckwith
Peter Hood
Paul Harvey – appointed 4 July 2022
Emma Scotney – appointed 9 January 2023
Eduard Eshuys – resigned 8 September 2022
Samantha Hogg – resigned 17 October 2022
Bruce Parncutt – resigned 7 September 2022
De Grey Mining 2023 Annual Report | 39
Information on Directors
Simon Lill, BSc MBA
Non-Executive Chairman
Mr Lill was appointed to the board in October 2013 and became Executive Chairman in 2014. In May 2020
he was appointed Non-Executive Chairman. 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 ceased
-
-
-
-
Company
Iris Metals Limited
Nimy Resources Limited
Purifloh Limited
Evergreen Lithium Limited
Date appointed
29 December 2020
16 August 2021
2 September 2013
21 January 2022
Interest in shares and rights at the date of this report:
13,919,629 ordinary fully paid shares
No unlisted options or rights over ordinary shares in De Grey Mining Limited
Committees
Audit & Risk Committee
Remuneration & Nomination Committee
Glenn Jardine, BE (Mining) FAusIMM
Managing Director
Mr Jardine was appointed Managing Director 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, 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.
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.
Interest in shares, options and rights at the date of this report:
70,846 ordinary fully paid shares
581,572 unlisted options over ordinary shares in De Grey Mining Limited
94,738 performance rights (Tranche 3)
Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 vested in September 2021 and were
exercised in August 2022, T2 91,008 were forfeited in September 2022 and T3 94,738 are expected to vest
in September 2023.
De Grey Mining 2023 Annual Report | 40
Andrew Beckwith, BSc Geology, Aus IMM
Non-Executive Director
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 technical roles with Westgold Resources, AngloGold Ashanti, Acacia Resources, Helix
Resources, Normandy NFM, North Flinders Mines and BP Minerals Australia. At Westgold, Mr Beckwith
initially held the role of exploration manager before appointment as Managing Director.
During his time at De Grey, he has led and built the geological team that ultimately discovered Hemi and
has helped grow the company’s gold resources from 0.3Moz to 11.7Moz. He is a co-recipient of the industry
Prospector of the Year Award for the Hemi discovery.
Subsequent to the reporting period, Mr Beckwith stepped back from his fulltime executive role to become
a Non-Executive Director of the company on 19 July 2023.
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, options and rights at the date of this report:
5,904,875 ordinary fully paid shares
440,700 unlisted options over ordinary shares in De Grey Mining Limited
Peter Hood AO, BE(Chem), MAusIMM, FlChemE, FAICD
Lead Independent Non-Executive 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 an Officer of 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:
Date ceased
-
-
-
Company
Cue Energy Resources Limited
GR Engineering Limited
Matrix Composites and Engineering Limited
Date appointed
23 February 2018
10 February 2011
15 September 2011
Interest in shares and options at the date of this report:
3,205,000 ordinary fully paid shares
No unlisted options over ordinary shares in De Grey Mining Limited
74,993 share rights
Committees
Audit & Risk Committee, was Committee Chair from October 2022 – February 2023
Sustainability Committee, was Committee Chair from July 2022 – December 2022
Chair of the Remuneration & Nomination Committee
De Grey Mining 2023 Annual Report | 41
Paul Harvey, BE (Mining), FAus IMM, MAICD
Independent Non-Executive Director
Mr. Harvey was appointed to the board in July 2022. He is an experienced resource executive with
operational and projects leadership built from over 35 years global experience in the resources sector,
including gold. His recent roles include leadership positions at South32 (2015 – 2020) including four years
as Chief Operating Officer with accountability for global manganese, base metals, coal for steel operations
and all supporting technical and project functions. Prior to that he held the position of Chief Transformation
Officer, a founding Executive Committee role established as part of the South32 demerger from BHP. Senior
executive roles at BHP included President Nickel West and President and COO BHP Billiton Diamonds.
Mr Harvey has since 2021 held the role of Senior Operating Partner with London based Appian Capital
Advisory, providing operational oversight to Appian’s portfolio companies and advice with the analysis and
evaluation of potential investments. In 2022, Mr Harvey was also appointed to Wyloo Metals Pty Ltd
Advisory Committee.
During the past three years Mr Harvey has also served as a Director of the following listed companies:
Company
Sandfire Resources Ltd
Date appointed
12 September 2023
Date ceased
-
Interest in shares and options at the date of this report:
No ordinary fully paid shares
53,177 share rights over ordinary shares in De Grey Mining Limited
Committees
Remuneration & Nomination Committee
Sustainability Committee, was Committee Chair from January 2023 – current
Emma Scotney, B.A, LLB (Hons), GAICD, GradDipMgmt (Strategy and Finance)
Independent Non-Executive Director
Ms Scotney was appointed to the board in January 2023. She is a highly experienced Business Advisor and
Corporate Lawyer who has over 25 years combined expertise in the property, agricultural and mining
industries. She has extensive expertise in advising on corporate, financial and commercial matters, including
M&A and corporate governance policy. Ms Scotney is also a member of a private company Board
responsible for the operations of a large commercial livestock and cropping enterprise providing strong
financial and legal oversight.
During the past three years Ms. Scotney has also served as a Director of the following listed companies:
Company
Minerals 260 Limited
Zenith Minerals
Date appointed
1 November 2021
5 May 2022
Date ceased
-
7 February 2023
Interest in shares and options at the date of this report:
No ordinary fully paid shares
No options or rights over ordinary shares in De Grey Mining Limited
Committees
Audit and Risk Committee (appointed 9 January 2022), was Committee Chair from March 2023 - current
Sustainability Committee (appointed 9 January 2022)
De Grey Mining 2023 Annual Report | 42
Eduard Eshuys, BSc, FAusIMM, FAICD
Non-Executive Director
Mr Eshuys was appointed to the board on 23 July 2019 and on 8 September 2022, resigned from the board.
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.
During the past three years Mr Eshuys has also served as a Director of the following listed companies:
Company
DGO Gold Limited¹
NTM Gold Limited
Dacian Gold Limited
Date appointed
15 July 2010
26 March 2019
16 March 2021
Date ceased
24 June 2022
16 March 2021
28 September 2022
¹On 24 June 2022, Mr. Eshuys resigned as Managing Director of former ASX listed and major De Grey shareholder DGO Gold Limited
on their takeover by ASX listed Gold Road Resources Limited.
Interest in shares and options at the date of resignation:
52,227 ordinary fully paid shares at the date of resignation
Committees
Sustainability Committee (resigned 8 September 2022)
Remuneration & Nomination Committee (resigned 8 September 2022)
Samantha Hogg, Bcom
Independent Non-Executive Director
Ms Hogg was appointed to the board on 28 January 2022 and on 17 October 2022, resigned from the
board. Ms. Hogg has had a distinguished executive career with international experience across the resources
and infrastructure sectors. She previously held senior finance and governance leadership positions at
Transurban Group (2008 – 2014) including three years as CFO during a significant growth phase when the
company entered the S&P/ASX20 Index.
Ms. Hogg has also had significant mineral resources experience through executive roles held with Vale (2006
– 2007) and Western Mining Company (1992 – 2005) with experience spanning finance, treasury, strategic
projects, marketing, people and corporate services.
During the past three years Ms Hogg has also served as a Director of the following listed companies:
Company
Adbri Limited
Cleanaway Waste Management Ltd
MaxiTRANS Industries Limited
Date appointed
29 March 2022
1 November 2019
28 April 2016
Date ceased
-
-
19 March 2021
Interest in shares, options and rights at the date of resignation:
No ordinary fully paid shares
No options or rights over ordinary shares in De Grey Mining Limited
Committees
Chair of the Audit & Risk Committee (resigned 17 October 2022)
Sustainability Committee (resigned 17 October 2022)
Remuneration & Nomination Committee (resigned 17 October 2022)
De Grey Mining 2023 Annual Report | 43
Bruce Parncutt AO, BSc, MBA
Non-Executive Director
Mr Parncutt was appointed to the board on 23 July 2019 and on 7 September 2022, resigned from the
board. Mr Parncutt holds the Chairman role for 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.
During the past three years Mr Parncutt has also served as a Director of the following listed companies:
Company
DGO Gold Limited¹
Date appointed
23 May 2018
Date ceased
24 June 2022
¹On 24 June 2022, Mr. Parncutt resigned as a Director of former ASX listed and major De Grey shareholder DGO Gold Limited on their
takeover by ASX listed Gold Road Resources Limited.
Interest in shares and options at the date of resignation:
52,227 ordinary fully paid shares at the date of resignation
Company Secretary
Craig Nelmes, BBus
Mr Nelmes is an Accountant who joined De Grey in October 2013 and has over 30 years’ experience in the
provision of finance, secretarial, governance, financial systems and providing 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 as well as ten years with
Corporate Consultants Pty Ltd, a Company providing accounting, secretarial and administrative services to
ASX and TSX listed entities.
Chief Financial Officer
Peter Canterbury, BBus CPA
Mr Canterbury is an experienced mining executive and Certified Practicing Accountant with substantial
experience in leading ASX-listed mining companies, most recently as MD of ASX-listed Triton Minerals and
CEO of Bauxite Resources. Peter has as a broad skillset spanning financial and corporate management,
accounting, project financing, feasibility studies, contract negotiation and mining operations. He has held
senior roles within the mining industry for close to 30 years. Previously CFO and Acting CEO of Sundance
Resources, where he played a lead role in rebuilding the company following a plane accident in 2010 and
was instrumental in negotiating the Mining and Development convention for Sundance in Cameroon and
Republic of Congo for the US$5 billion iron ore mine, rail, and port project. His previous positions include
CFO of Dadco Europe with its alumina and bauxite operations in Europe and Africa and several positions
with Alcoa in finance, marketing, and project development. Peter brings highly relevant financial expertise
to support De Grey’s ambitions of becoming a Tier 1 gold producer from Hemi.
Principal Activities
The principal activity of the consolidated entity during the year was our focus on the 100% owned Hemi
Gold Project (HGP) in the Pilbara region of WA, and includes the large scale, high value, near surface 2019
Hemi gold discovery.
The Hemi discovery is an intrusion-hosted form of gold mineralisation new to the Pilbara region and shows
a scale of mineralisation not previously encountered in the Mallina Basin. Gold mineralisation at Hemi is
hosted in a series of intrusions associated with stringer and disseminated sulphide rich zones.
De Grey Mining 2023 Annual Report | 44
In September 2022 the Company completed its Pre-Feasibility study (PFS) a major de-risking milestone in
that it provides much greater detail and confidence on the proposed development scenario for the HGP.
DEG is targeting the completion of a Definitive Feasibility Study (DFS) and Final Investment Decision (FID)
within the coming 12-months and to be then followed by an expected two-year construction phase into
first production by the 2nd half of calendar 2025.
Financial Review
The consolidated loss after tax for the year ended 30 June 2023 was $19,005,221 (2022: $10,536,710). Details
of our operations is included in the Managing Directors report and operations review, preceding this report.
Earnings per share
The basic loss per share for the year ended 30 June 2023 was 1.25 cents per share (2022: 0.77 cents per
share).
Dividends
No dividends were paid or declared during the financial year (2022: None). 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 year, other than
those included in the Key Highlights within the Review of Operations.
Governance
We have adopted Corporate Governance policies representing the system of control and accountability for
the administration of corporate governance. De Grey Mining’s Board is committed to managing these
policies and procedures in a manner which is directed at achieving our objectives in a proper and ethical
manner.
To the extent they are applicable to De Grey, the Board has adopted the ASX Corporate Governance
Council’s - Corporate Governance Principles and Recommendations 4th Edition.
To read the Company’s 2023 Corporate Governance Statement and Appendix 4G visit our website.
Matters subsequent to the end of the financial year
Subsequent to 30 June 2023, De Grey Mining Limited announced on 13 September 2023 that the
Department of Mines, Industry Regulation and Safety granted Mining Leases 45/1295 and 45/1299 to
Domain Mining Pty Ltd and Mining Leases 45/1294 and 47/1628 to Last Crusade Pty Ltd, being wholly
owned subsidiary companies of De Grey Mining Ltd. The Mining Leases are part of the Hemi Gold Project
which hosts the Hemi deposit.
There have been no other 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 results of those
operations, or the state of affairs of the Group in future financial years.
De Grey Mining 2023 Annual Report | 45
Likely developments and expected results
There are no further developments or expected results other than those which have been reported under
matters subsequent to the end of the financial year.
De Grey Mining 2023 Annual Report | 46
Remuneration Report (Audited)
The remuneration report is set out under the following headings:
Executive Summary
A. Details of Key Management Personnel
B.
C. Remuneration Governance
D. Company Financial Performance Over Past 5 Years
E. Overview of Executive Remuneration Framework
F. Alignment of Remuneration to the Strategic Objectives
G. Executive STI and LTI Remuneration Performance Outcomes
H. Executive Service agreements
I. Non-Executive Director remuneration
J. Details of 2022-23 KMP remuneration
K. Key Management Personnel - shareholdings, unlisted option holdings and performance rights holdings
L.
M. Other transactions and balances with key management personnel
Securities based compensation options and performance rights
A. Details of Key Management Personnel (KMP)
The Directors of De Grey Mining Limited present the Remuneration Report for the Group for the year ended
30 June 2023. The report forms part of the Directors’ Report and has been audited in accordance with
section 300A of the Corporations Act 2001.
The report details the remuneration arrangements for the Company’s Key Management Personnel (KMP):
• Non-Executive Directors (NEDs)
•
Executive Directors and senior executives
KMP’s are those persons who, directly or indirectly, have authority and responsibility for planning, directing,
and controlling the major activities of the Group including all Directors of the Company.
The table below outlines each KMP of the Company and their movements during the year.
Name
Position
Term
Non-Executive Directors
Mr Simon Lill
Mr Peter Hood AO
Mr Paul Harvey
Ms Emma Scotney
Mr Eduard Eshuys
Ms Samantha Hogg
Mr Bruce Parncutt AO
Executive Directors
Mr Glenn Jardine
Mr Andrew Beckwith
Non-Executive Chairman
Lead Independent Non-Executive Director
Independent Non-Executive Director
Full financial year
Full financial year
Appointed 4 July 2022
Independent Non-Executive Director
Appointed 9 January 2023
Non-Executive Director
Independent Non-Executive Director
Non-Executive Director
Resigned 8 September 2022
Resigned 17 October 2022
Resigned 7 September 2022
Managing Director
Technical Director
Full financial year
Full financial year
Other Key Management Personnel
Mr Craig Nelmes
Mr Peter Canterbury
Mr Philip Tornatora
Mr. Peter Holmes
Company Secretary
Chief Financial Officer
General Manager - Exploration
Project Director
Full financial year
Full financial year
Full financial year
Appointed 21 February 2023
De Grey Mining 2023 Annual Report | 47
B. Executive Summary
Following the initial discovery announcement of the world class Hemi Deposit back in December 2019, the
Board set its remuneration strategy in 2020 for a three-year period ensuring milestone targets were closely
aligned with exceptional company performance and significant increases in resources, on achievement were
expected to add significant shareholder value through increasing resources and de-risking the path toward
becoming a Tier 1 gold producer.
This year marks the end of that remuneration strategy, and all of the KMPs fixed, short term and long term
incentives have been reviewed and awarded. The Company has undertaken a detailed review of the
Company’s forward looking strategic priorities for the next three years in June 2023 and where necessary
has refined the Group’s Executive Remuneration structures to ensure alignment with the longer-term
strategic objectives.
Performance
Throughout the three years, the Company has delivered against its Strategic Objectives of developing a Tier
1 Gold Asset and adding shareholder value. Key milestones include:
September 2020 – Addition to the S&P/ASX 300 Index
June 2021 – Maiden 6.8Moz Hemi Deposit JORC Resource;
•
•
• March 2022 – Addition to the S&P/ASX 200 Index;
• May 2022 – Update to 10.6Moz Hemi Gold Project JORC Resource, including 8.5Moz at Hemi Deposit
•
•
•
and a Global M&I Classified Resource of 6.9Moz;
September 2022 – Prefeasibility Study Outcomes;
June 2023 – Update to 11.7Moz Hemi Gold Project JORC Resources, including 9.5Moz at Hemi
Deposit and a Global M&I Classified resource of 8.1Moz;
June 2023 – the Company has grown from a market capitalization of $1B at 20/08/2020 to $2B, a
significant increase in shareholder value.
This year, De Grey significantly improved our market capitalisation primarily by increasing the JORC
resources and delivering the PFS outcomes with exceptional metrics.
Remuneration Summary
Each year our KMP remuneration is benchmarked with a peer review against companies who are Producers
as well as those in Project development and a similar market capitalisation that may impact on our ability
to retain and attract experienced individuals. The following table summarises the increases for 2023.
Executive KMP
Remuneration
5.5%
Short-term incentive
Long-term incentive
NED Remuneration
84.5%
86% vested
Committee fees
5.5% CPI adjustments were
made to salaries for KMPs
except where they received
a market or pay scale
adjustment.
Overall earnings on STI’s
ranged from 83%-87%
achieved through
weighted average
scorecard assessment.
Milestones were considered
vested and board discretion
was applied as to what
percentage of each
milestone could be
awarded.
The introduction of payments
for committee chair and
members increased the rate
the overall remuneration was
increased.
The major factors influencing the review of remuneration and those considered in the overall remuneration
decision include;
•
The Company has increased in size, increased exploration activities, which has made planning,
prioritisation, decision-making and risk/ opportunity management significantly more complex.
De Grey Mining 2023 Annual Report | 48
• Western Australian businesses, affected by the COVID-led border closure, have waged an ongoing
battle for scarce skills and talent. This has resulted, inter alia, in significant pay increases across the
resources sector, and also has the effect of reducing the experienced talent pool.
• Global markets and shareholders are looking for more accountability and proof of good governance
across a broad range of environmental, social and employee related factors that need to be
implemented and entrenched by leaders and managers, whilst also delivering on the traditional
financial and reputational metrics.
The societal and psychological impact of Covid-19 has resulted in people re-evaluating what is
important to them, in work and in non-work fields. As a result, companies have introduced a number
of incentives that help with improving work-life balance and longer-term retention.
•
Given the market research resulted in multiple significant changes to the market, the Company considered
changing the total remuneration opportunity framework from a 75%/25% mix between project
development (75%) and producer (25%) peer group markets to a 50%/50% project development and
producer mix that captures the complexity of the business as well as the appropriate ‘job size’ of the roles
as it relates to De Grey.
Summary of Current Plans
There are three shareholder approved securities plans available to Non-Executive Directors, Executives and
all other Employees;
• Performance Rights and Option plan (PR&OP),
• Non-Executive Directors Share Plan, and
•
Incentive Share Plan
The following summarises the performance rights, share rights and options issued with relation to the
Incentive Plans applicable in FY23 to add context around the structure of the various incentives and their
achievement.
Managing Director Performance Rights
These governed by the “Performance Rights and Option Plan” and are only issued to Glenn Jardine,
Managing Director. There are 3 tranches, and each tranche has a share price milestone to be achieved.
Executive ZEPO’s
Governed by the “Performance Rights and Option Plan”, these are issued to Executives as Long Term
Incentives (LTI’s), have performance milestones and form part of their remuneration.
2017 Performance Rights
These fall under the “Performance Rights and Option Plan” and were issued in 2017 to Executives in 5
tranches, with various vesting conditions. The expiry date of these was November 2022, and have all since
vested or been forfeited, with all vested rights exercised.
Not included as incentives, the following summarises the share rights issued that relates to the provision of
services by Non-Executive Directors.
Non-Executive Director Share Rights
These are issued under the “Non-Executive Directors Share Plan” and are issued to NEDs who have elected
to participate in the plan and receive shares in lieu of cash as a component of their Directors fees. These
rights are consideration for services rendered and are required to be approved at the AGM. Where the
rights are not accepted at the AGM, the payment is made to the Director as cash.
De Grey Mining 2023 Annual Report | 49
Short term incentives (STi) Outcomes
The board has determined that an 84.5% on average of the maximum STi annual award be paid to Executive
KMP and other eligible participants based upon the performance measures set by the Board during the
September quarter of 2022. This has resulted in a payment of $688,850 to the Executive KMP.
Long-term Incentive (LTi) Outcomes
The KMP Executives LTi Annual Awards were first approved by shareholders at the December 2020 AGM
with respect to Executive Directors. Zero priced options (ZEPO’s) were issued upfront for the full 3 year
period (2020/21-2022/23), and any adjustments to bring KMP’s inline with annual remuneration reviews
and to reward newly appointed KMP’s were issued annually.
Key Performance criteria were identified to reward performance and increase shareholder value. The
conditions under which these would vest, were intended to see completion at the end of the 2022/2023
financial year. These are summarised as follows;
• Remain employed ✓
• Delineation of mineral resources of 12 million ounces of gold at the Hemi Gold project
• DFS completed, confirming feasibility for a 500,000 ounces of gold project with a 12 year mine life
(or other such number as approved by the Board following completion of a Pre-feasibility Study)
Securing debt and/or equity finance for a Board approved project arising from the DFS.
•
The LTI was reviewed by the remuneration committee who made a recommendation to the Board, using its
discretion to approve the vesting conditions, to award 86% of the LTI target at 30th June 2023. Whilst the
vesting date of the LTI’s was always considered by the Board to be 30 June 2023, the original vesting period
for accounting purposes was December 2024. The accelerated vesting did not result in any incremental fair
value and the underlying share price at vesting date was $1.345.
Factors that were taken into account in the determination of the outcome included delays caused by COVID-
19 and the increased scale and complexity of the projects with respect to geotechnical and Hydrogeology
studies.
The Board took into account the following factors in making its decision;
➢ The company achieved 11.7Moz JORC resource using an assay cut off in March but has ample
information to reasonably expect that the 12Moz result would have been achieved if the cut off was
30 June 2023;
➢ DFS not completed but known to be imminent as the majority of the reports had been completed;
and
➢ Funding is partially dependent on the DFS, however the Company has been provided with non-
binding indicative offers from 14 leading financial institutions, reflecting the confidence and interest
in the Company’s Hemi Gold Project.
The Managing Director, Mr Glenn Jardine, was issued with three tranches of performance rights in
November 2020, each tranche relating to FY2022, FY2023 and FY2024, with vesting conditions that required
the share price to increase by 120% for each vesting period. During the year, the tranche relating to FY2023
required a target share price of $1.318 by 15 September 2022. This condition was not met and the
performance rights were forfeited. This was known in the previous year’s report and was reported
accordingly. The next and final tranche is due to vest on 15 September 2023.
Although not considered part of the LTI plan, other performance rights issued in 2017 vested during the
year after shareholders granted approval at the 2022 AGM through an application to waive the vesting
conditions. These performance rights had an expiry of November 2022 and all were exercised.
De Grey Mining 2023 Annual Report | 50
Non-Executive Director fees
In September 2022, the Company engaged the services of independent remuneration consultant BDO
Rewards to undertake a review of the Non-Executive remuneration settings taking into account comparable
roles, the market capitalisation of the Company and other pertinent market data. As a result of this review,
the board approved an increase in Non-Executive Director and committee fees, effective, with those
recommended changes considered and adopted as effective from 1 July 2022.
To align the interests of the Board and shareholders, the Non-Executives are offered the option to take up
to $50,000 per annum of their fees in share rights, subject to shareholder approval and under the terms and
conditions of the Non-Executive Director Share Plan, as last approved on 29 November 2021.
C. Remuneration Governance
Role of the Board
The Board is responsible for setting De Grey’s remuneration policy, aiming to ensure that the remuneration
framework aligns with the company’s strategic objectives, creates shareholder value, is competitive, and
structured toward the attraction and retention of the Executive KMP. The board also approves the
remuneration settings of the Managing Director, the other Executive KMP’s and their performance targets
settings for short-term and long-term incentives.
The board has a formal Charter with respect to Remuneration and which has delegated to the Remuneration
and Nomination committee the design and review of the Remuneration Policy and make appropriate
recommendations back to the Board.
The Remuneration and Nomination Committee consists of Lead Independent Non-Executive Director Peter
Hood (the Committee Chair), Paul Harvey, an Independent Non-Executive Director and Simon Lill, the Non-
Executive Chair of the Board. The Managing Director attends meetings, by invitation, to make management
presentations and appropriate recommendations with respect to his direct reports and all other employees
but has no vote with respect to matters before the Committee. A standing invitation is also made to other
Non-Executive Directors to attend and observe meetings. The Committee has in place appropriate
procedures to appropriately manage conflicts of interest.
Expert advice and recommendations are sought from independent external remuneration consultants
whose scope of work, engagement and reporting is directly back to the Remuneration Committee. That
advice on the remuneration policy and settings included benchmarking Director and key management
personnel remuneration against comparable entities to ensure that remuneration packages are consistent
with the market and are appropriate for the organisation. During the year, the Remuneration & Nomination
Committee approved the engagement of BDO Rewards (WA) Pty Ltd, (“BDO”) to provide advice on the
Executive Incentive Framework, Executive Remuneration Benchmarking and Non-Executive Director
Remuneration.
Both the Board and Committee are satisfied that appropriate procedures are in place and followed to ensure
that the advice from BDO is free from undue influence from the KMP to whom the remuneration
recommendations apply, as well as by the Directors with respect to the setting of Non-Executive Director
remuneration. The BDO remuneration recommendations were provided to the Committee as an input into
decision making only. The Remuneration & Nomination Committee considered the BDO recommendations
as a key input in developing their own independent assessment and allow recommendations to changes in
the quantum and remuneration structure back to the board.
De Grey Mining 2023 Annual Report | 51
Fees paid to BDO with respect to the advice were $24,750. In addition to providing remuneration
recommendations, BDO provided advice on other aspects of remuneration of the Groups employees. Fees
for these services amounted to $4,750.
During the 2022-23 financial year, the Committee reviewed and made recommendations to the board in
relation to KMP, other executives and overriding employee remuneration considerations in respect to:
Executive remuneration policies;
•
• Determining the eligibility, awarding and where applicable the vesting of short-term incentives (STI)
and long-term incentives (LTI), including the issuing of securities in accordance with existing
shareholder approved plans and seeking approval by shareholders (as required);
• Non-Executive Director remuneration;
•
The aggregate Non-Executive Remuneration pool and seeking approval by shareholders for changes
(as required);
• Appropriate remuneration disclosures in ASX releases including the Annual report; and
• Other employment retention policies with respect to employees.
Voting on the Remuneration Report - 2022 Annual General Meeting (“AGM”)
The Company received positive shareholder support and acceptance at the 2022 AGM with approximately
98.99% voting in favour of the Remuneration Report for the 2022 financial year (2021: 85.32%).
D. Company Financial Performance Over the Past 5 Years
The table below sets out information about De Grey Mining’s performance and movements in shareholder
wealth for the past five years up to and including the current financial year.
2023
2022
2021
2020
2019
Net loss
19,005,221
10,536,710
5,250,269
3,976,002
2,009,130
Share price at year end ($)
Basic EPS (cents)
Total Dividends per share
1.345
(1.25)
-
0.81
(0.77)
-
1.24
(0.41)
-
0.091
(0.41)
-
0.067
(0.50)
-
Share Price & Volume
$2.00
$1.50
$1.00
$0.50
$0.00
S
N
O
I
L
L
I
M
600
500
400
300
200
100
-
1/06/2019
1/06/2020
1/06/2021
1/06/2022
1/06/2023
Volume
Share Price
De Grey Mining 2023 Annual Report | 52
E. Overview of Executive Remuneration Framework
The De Grey remuneration strategy includes engaging, recognising and rewarding our people. An annual
remuneration review is conducted to ensure alignment with the Company’s evolution and market
conditions to attract and retain our people which includes executive pay.
Our remuneration strategy is based on the following principles:
attracting and retaining high performing personnel,
recognising and rewarding people in line with achievement of strategic objectives,
•
•
• maintaining competitiveness in the industry, and
• maintaining a flexible approach.
The remuneration and nomination committee framework for executive remuneration comprises a mix of
developer and producer peer market assessments on a sliding scale, until production is reached, where the
strategy will be solely based on a producing peer market. This framework is adjusted to align closer to a
producer status as the Company evolves as an organisation and moves from exploration through project
development, construction and into operations.
It is critical to retain our executives as we progress towards project implementation in FY24 to ensure we
keep stability, internal expertise and demonstrate our capability to the market. The different lifecycles of
the business over the coming years presents opportunity to recognise and reward our executives as their
breadth grows as does market expectations and deliverables.
We reward executives by providing a mix of fixed remuneration (base salary plus superannuation capped
at $27,500 for the 2022-23 financial year) and variable remuneration consisting of short-term (“STI”) and
long-term incentives (“LTI”) on key performance areas affecting the Group’s financial results or operational
milestones.
Measurement tools used in determining fixed annual remuneration include consideration of general market
conditions and that includes benchmarking against industry peers for comparable executive roles. The
process is incorporated into the periodic remuneration reviews undertaken and with oversight of the
Remuneration and Nomination Committee.
Mix of Remuneration (Target)
Managing Director
Fixed Remuneration
STI
LTI
Other KMP’s (average)
Fixed Remuneration
STI
LTI
%
48%
18%
34%
48%
15%
37%
Final quantum determination based upon annual performance
review, including consideration of their performance against a KPI
scorecard.
Up to 50% of annual LTI is held at risk and measured against
performance
Final quantum determination based upon annual performance
review, including consideration of their performance against a KPI
scorecard.
Up to 50% of annual LTI is held at risk and measured against
performance
De Grey Mining 2023 Annual Report | 53
Performance Rights and Option Plan (PR&OP), Performance Rights (PRP) and Employee Option
Plans (EOP) of De Grey Mining Limited
The Performance Rights and Option Plan (PR&OP) was approved by Shareholders at the 2021 Annual
General Meeting (“AGM”). This combined plan will supersede the previous and separate shareholder
approved Performance Rights Plan (PRP) and Employee Option Plan (EOP).
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 the PR&OP and previously the PRP and EOP collectively represents 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.
•
F. Alignment of Remuneration Framework to the Strategic Objectives
The Key Strategic Objective is to maximise shareholder value by becoming a Tier 1 gold producer at the
Hemi Gold Project, that includes the World Class Hemi Deposits, located in the Hemi Gold Province in the
Pilbara region of Western Australia. The 2022 Annual Report articulated the following Key Objectives for the
2022-23 financial year as being:
Development & Studies Initiatives
Exploration & Discovery
• Prefeasibility Study (PFS) released Sep’22 Qtr
•
•
Increase Hemi reserves
Increase Hemi production potential – update
pit optimisations for resources extended
• Establish regional reserves
• Definitive Feasibility Study (DFS) complete
Sep’23 Qtr
Increase Hemi & Regional deposits resources
•
• Hemi targeted resource definition drilling
Increase Hemi % JORC Indicated Open Pit
•
deposits
• Regional targeted resource definition drilling
• Pursue new discoveries – extensive ongoing
exploration activities
Sustainability Initiatives
Project Funding
• Environmental approval submissions
• Establish Native Title Agreements
• Renewable Energy – key consideration of the
DFS and beyond
• Undertake project funding discussions
• Project funding options for construction of
project calendar year 2023
• Financial Investment Decision (“FID”)
• Build strong relationships with key
calendar year 2023
stakeholders
De Grey Mining 2023 Annual Report | 54
G. Executive STI and LTI Performance Review Outcomes
Short-term Incentive (STI)
The STI is designed to reward employee performance with respect to a balanced scorecard of financial and
non-financial performance measures. The annual STI opportunity exists for all executives in the form of a
cash bonus. The executive must be employed to be eligible to receive the payment and achieve a score of
at least 65% in respect to Wealth Creation and Preservation performance metrics used in guiding the annual
STI review process. The STI base is determined at the beginning of the year for each KMP in line with the
annual remuneration review.
The Key features of the Annual STI review are as follows:
• One year performance period covers 1 July 2022 – 30 June 2023;
•
Each executive is assessed utilising a KPI Scorecard rating process with criteria addressing wealth
creation and preservation performance metrics, and
• A 2022-23 KPI Scorecard was developed by each executive in conjunction with the Managing Director
and recommended to the Remuneration Committee and approved by the Board. The STI measures
for each executive were chosen to best align the performance with the business objectives included
in the Strategic Plan.
The focus this year was to advance the project to the DFS stage whilst ensuring the safety of employees,
relationships with stakeholders are maintained and compliance elements are met. KMPs will be assessed
using a scorecard that considers a weighted evaluation against these criteria. This is considered the best
approach given the size and nature of the company.
Wealth creation criteria
These measures best ensure the overall financial health of the Company by assessing the effectiveness of
strategies and demonstrating progress towards financial goals.
DFS
Deliver a completed DFS with improved metrics relative to the PFS to the board by 30 June
2023.
Global Resources
and Reserves
Increase to 12 M oz’s of resources, 6M oz of reserves, as measured by assays received by 30
June 2023.
Company Share
Price
Increase in share price relative to GLX and valuation peers. Potential capital raising effects to
be taken into account. July 1 2022 to June 30 2023.
Financial
Establish a clear debt financing option capable of execution subject to project and credit
approvals, equity arrangement and royalty heads of agreement capable of execution.
Business
Development
Finalise agreements with third parties of strategic benefit to project development and
business development opportunities. For example, with Atlas Iron on facilities at Mt Dove, a
joint venture with a regional third party.
Discovery
Make discovery estimated to be capable of delivering ~1Moz in resource.
Innovation and
Technology
Innovative project that creates >$10M saving or operational improvement over LOM or first
10 years. Increase NPV of the DFS through technology opportunities: e.g. ore sorting at
Toweranna.
Production
Provide opportunity to increase production by a minimum of 50Kozpa for 10 years.
Gold
Provide opportunity to secure highest priority targets outside of the existing Hemi Gold
Project.
De Grey Mining 2023 Annual Report | 55
Each KMP was assessed on a selection of the above criteria with a weighting of 10% for each, with the
exception of Mr Phil Tornatora, who has increased influence over global reserves (20%), DFS outcomes (15%)
and Discovery (15%).
A summary of the outcomes follows;
• Definitive feasibility study (DFS) – well advanced and expected to be delivered in the Sep’23 Quarter;
• Global resources, reserves and Discovery - growth achieved +10% global resource of which +16%
•
added to the Measured and Indicated category;
Share Price and Investor engagement – share price outperformance of selected indices including
ASX200, broadening institutional investor base;
• Development opportunities identified, most notable being the executed Strategic Egina Joint Venture
•
•
adding 70% to the overall landholding contiguous to the Project area;
Innovation & technology initiatives embedded in all aspects of the Study process and in Strategy
settings; and
Finances, reporting and systems – remain well funded toward meet corporate objectives, systems
enhancements ongoing with a strong emphasis on underlying systems of control.
Wealth preservation criteria
Given the changes in market conditions, the internal factors including growth, the increase in activity and
the importance of building capability within the organisation, wealth preservation criteria help monitor risk,
identify potential threats, and adapt strategies.
Health and Safety
Implementation of HSE system and culture that fully encompasses the current WA HSE Act.
Achieve a RIFR below the 21/22 performance with zero LTIs.
Sustainability
Lead management team in undertaking an ESG gap analysis, improve ESG reporting and
visibility and communicate decarbonisation plan.
Community
Relations
Execute mining agreement with KAC and demonstrably advance mining agreement process
with Ngarluma and Nyamal and others as required.
People
Behaviour /
Culture
Systems
Reporting
Tenure
Build organisation capability capable of executing the project in line with approved workforce
plan to achieve project milestones. Achieve an overall business female diversity target of a
minimum of 25% to stretched target of 35%.
Ensure respectful behaviour at all levels is in line with company values. Achieve zero
harassment incidents of a significant nature.
Undertake transition to remote hosting service to support increased activity and project
development. Implementation of remaining business support systems and a comprehensive
Company Kiosk to allow all people to access the resources they need. Establish a cyber
security policy that minimises cyber risk and incidents.
Half year and annual accounts/reports accuracy and release two weeks prior to deadline.
Quarterly 1 week prior to deadline.
Remove objections to mining lease and miscellaneous license applications through
agreements with Station owners and other tenement holders.
Each KMP was assessed with a weighting of 10% except for Reporting which applied to Mr Craig Nelmes as
this represents an important function of his role.
De Grey Mining 2023 Annual Report | 56
A summary of the outcomes follows;
•
Sustainability – gap analysis works ongoing as part of the DFS process and embedded in all aspects
of the Study process;
• governance and regulatory compliance - best practice regulatory obligations, timely reporting and
engagement.
• Health and safety –leadership in the development of systems, adaption to changes to regulatory
environment and building a safety culture;
• People – Behaviour, Culture & capability – building organisational capabilities and successful
implementation of the Corporate ESPRIT Core Values (Empathy, Safety, Personal Responsibility,
Respect at all Levels, Integrity and Thinking Differently);
• Maintaining robust compliance and asset tenure process; and
• Community relations – partnering and seeking agreements with key stakeholders
The scorecard was used to assess the performance of the KMP and outcomes for the 2022-23 financial year
are included within the table below where the amount to be paid in the 2023-24 financial year (STI Awarded)
is calculated as the STI base multiplied by the STI Achievement %.
Executive KMP
$
STI Base
STI Achievement
%
STI Forfeited
%
STI Awarded
$
Glenn Jardine
Andrew Beckwith
Peter Canterbury
Craig Nelmes
Philip Tornatora
Peter Holmes
Total
$260,000
$150,000
$140,000
$65,000
$130,000
$69,767
$814,767
84%
83%
84%
87%
86%
86%
16%
17%
16%
13%
14%
14%
$218,400
$124,500
$117,600
$56,550
$111,800
$60,000
$688,850
1Peter Homes commenced employment on 21 February 2023. His STI has been calculated on a pro-rata basis.
Long-term Incentive (LTI)
The LTI opportunity consists of zero priced unlisted options (ZEPO’s) and are issued to both Executive
Directors and other key management personnel. The current LTI is designed to reward performance over a
three-year period.
The ZEPO’s vest upon satisfaction of the following vesting conditions or where, vesting conditions are not
satisfied the Board does have overall discretion whether or not to vest the options.
As at 30 June 2023, these key performance criteria were assessed by the board and have taken into account
achievements with respect to the progression of the Hemi Gold project since the beginning of FY2020-21
when the performance criteria was set:
Performance Criteria
Remain employed by the company until vesting
date to be eligible to receive the payment
Delineation of a Global JORC Mineral Resources
of =>12Moz of gold at the Company’s Hemi
Gold Project (“Project”)
June 2023 Status
Satisfied by all KMP’s.
• Achieved 11.7Moz JORC resource
• Mar’23 drilling/assay cut-off dictated by DFS
timelines, and
JORC updates only for Hemi and Toweranna.
•
De Grey Mining 2023 Annual Report | 57
Completion of a DFS for the Project that:
• 500,000oz of gold p.a.;
• mine life of => 12 years, or such other
number Board approved post DFS; and
• DFS sign off in its entirety by a suitably
qualified engineering group (with oversight
from the Board)
Securing debt and/or equity finance for post
DFS Board approved Project
PFS delivered in Sep’22, shows
• Hemi maiden reserve of 5.1Moz of gold
• 540,000oz of gold p.a. – first 10 years; and
• 13.6 year mine life
DSF imminent, reports have been completed
awaiting finalisation.
Company provided with non-binding indicative
offers from 14 leading financial institutions. The
Board are confident that the Project will secure
funding following DFS results.
The Board, using its discretion, approved the vesting conditions, awarding 86% of the LTI target at 30th
June 2023, further details are provided in section B.
Non-market measures are intended to reward executives for aligning their rewards with De Grey’s business
outcomes and creating sustainable shareholder value. The objectives for De Grey are to exploit the Hemi
Gold project, which entails defining the resource and completing the definitive feasibility study, as well as
funding the project. The measures identified achieves these objectives and will create significant
shareholder value.
One half of these LTI ZEPO’s are evaluated against the KPI Scorecard in June of each year and upon achieving
65%+ score then these ZEPO’s, having achieved the incentive condition, remain eligible to vest. If the
executive does not achieve the annual score of 65% or more, then the 50% of the ZEPO’s will be cancelled,
whilst the balance will vest solely subject to achieving the LTI milestones.
LTI granted in 2022-23 financial year
There were 154,368 ZEPO’s issued to executives as LTI Incentives, as an LTI adjustment in FY2023. These
additional LTI ZEPO’s, issued at the discretion of the board are subject to evaluation over the remaining
period, with 50% at risk based upon the STI annual KPI scorecard result. These are issued to reflect annual
adjustments to overall remuneration for each KMP and executive.
If the executive ceases employment before the STI and LTI payment, they will lose the STI and any LTI award
unless the executive is a defined as a “Good Leaver”. Where the executive is a “Good Leaver”, a pro-rata
award may be made, subject to the Board’s discretion (and would include consideration of the employment
time served during the performance period and the satisfaction of any agreed KPI). The executive loses the
award on cessation of employment where they are considered a “Bad Leaver”. A good Leaver means the
Executive ceases to be employed by the Company because the Executive:
• dies or is permanently incapacitated so that they are unable to perform their employment duties;
•
• Validly terminates the Employment in accordance with its terms due to material breach by the
Is aged 60 or older and permanently retires from all employment;
Company;
• has the Employment terminated by the Company other than for reasons justifying summary dismissal,
a material breach of contract, underperformance or any other reason specified under the ESA; and/or
Additional LTI – Managing Director
The Managing Director also receives an annual LTI $100,000 in the form of performance rights, under his
employment agreement and issued on the following dates with an annual performance milestone of the
Company’s Shares reaching a price equal to or greater than 120% of the VWAP for the 10 trading days prior
De Grey Mining 2023 Annual Report | 58
to the date of issue of the Performance Rights, as well as remaining employed by the Company as Managing
Director as at the annual date of satisfaction of the milestone (15 September).
•
•
•
1st tranche – was issued in September 2020, milestone achieved, and performance rights vested;
2nd tranche – was issued in September 2021; milestone (being the achievement of a share price of
$1.318) not achieved, and performance rights forfeited; and
3rd tranche – was issued in September 2022, milestone assessment will be 15 September 2023 with
a target price of $1.266.
The Company will be required to seek fresh Shareholder approval in order to issue further Performance
Rights under the terms of the Employment Agreement, beyond Tranche 3.
No performance rights awarded to the Managing Director as LTI’s vested during the year, however 91,008
tranche 2 performance rights granted to Mr Glenn Jardine were forfeited which represents 30% of the LTI
opportunity to the Managing Director.
Other LTI granted in the 2017-2018 financial year
Issued and approved November 2017:
Performance rights were issued in 2017 with the following 5 tranches;
•
•
•
•
•
Tranche 1 – (100% vested) 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 within 2 years
of this AGM at the Pilbara Gold Project, – vested November 2019,
Tranche 2 – (100% expired) 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 within 2
years of this AGM at the Pilbara Gold Project, -– Expired November 2019,
Tranche 3 - (100% vested) finalisation of the Company's acquisition of 100% of Indee Gold Pty Ltd,
vested November 2019,
Tranche 4 – (100% vested) The Company securing Project Financing for the Pilbara Gold Project at a
minimum throughput of 1M tpa, Expiry date: November 2022 – vested November 2022,
Tranche 5 – (100% vested) the Company confirming higher grade resources of at least 200,000 ounces
and at an overall grade of > 5 g/t within 2 years of the Company’s AGM – vested November 2019.
At the 2022 AGM, a waiver was approved for the remaining Tranche 4 performance rights and its vesting
condition “The Company securing Project Financing for the Pilbara Gold Project at a minimum throughput of
1M tpa” with an expiry date of 30 November 2022. These were subsequently exercised on 30 November
2022 and there was no incremental fair value adjustment recognised. The share price at the date of the
waiver was $1.29.
De Grey Mining 2023 Annual Report | 59
H. 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 2023 are set out in the table below:
Name
Agreement
Base Salary
/Fees (p.a.)
STI
Base
LTI
Base
Consulting
/Hr
Duration
Notice
Period
Termination
Glenn Jardine
Service
$580,000
$ 260,000 $420,000
Andrew Beckwith
Service
$343,000
$150,000 $195,000
Craig Nelmes
Service
$274,000
$65,000
$100,000
Peter Canterbury
Service
$395,000
$140,000 $235,000
Philip Tornatora
Service
$343,000
$130,000 $200,000
Peter Holmes1
Service
$465,000
$209,250
-
1 Peter Holmes will be eligible for long term incentives in the 2024 financial year.
-
-
-
-
-
-
Ongoing 3 months
6 months
Ongoing 3 months
6 months
Ongoing 3 months
6 months
Ongoing 3 months
3 months
Ongoing 3 months
3 months
Ongoing 3 months
6 months
I. Non-Executive Director remuneration
The board policy is to remunerate Non-Executive Directors (NED’s) 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.
NED’s fees are determined within an aggregate NED fee pool limit, which is periodically 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. The last aggregate pool was approved
at the AGM held in November 2021 and is currently $1,500,000.
The annual remuneration for each Non-Executive Director was set in the range of $150,000 - $210,000 per
annum for the 2022-2023 financial year. These fees have been supported by independent advice from BDO
Rewards (WA) Pty Ltd and determined by the Board of the Company. The fees take into consideration factors
such as the market rates of industry peer companies, the current level of activity and the experience of the
Directors. 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.
Non-Executive Directors Share Plan
The objective of the NED Share Plan is to attract, motivate and retain its Non-Executive Directors and the
Company considers that the adoption of the Share Plan and the future issue of Shares Rights under the
Share Plan will provide Non-Executive Directors with the opportunity to participate in the future growth of
the Company.
The Non-Executive Directors can elect at the start of each financial year to receive up to a $50,000 portion
of their annual remuneration base fee in Share Rights under the Non-Executive Director Share Plan (NED
Share Plan) and subject to obtaining shareholder approval.
De Grey Mining 2023 Annual Report | 60
Specific to the 2022-23 financial year, Directors Peter Hood, Paul Harvey and Emma Scotney made an
election to receive a quantum of NED share rights.
•
•
•
53,177 Rights were issued to Paul Harvey after approval by shareholders was received at the AGM
held on 24 November 2022.
53,177 Rights were issued to Peter Hood, with shareholder approval received at the AGM dated 29
November 2021.
Emma Scotney commenced after the AGM and will seek approval at the 2023 AGM.
Share rights issued to Paul Harvey and Peter Hood were determined by dividing an amount of $50,000 by
the face value of Shares (calculated as the 30 day VWAP as at 1 July 2022 of $0.9403). 18,888 share rights
will be issued to Emma Scotney after they are approved by shareholders at the 2023 AGM.
The only vesting condition of this issue of NED share rights is that the individual remains a Non-Executive
Director of the Company on 30 June 2023, with pro rata reduction if the directorship ends for any reason
prior to 30 June 2023. Performance hurdles are not required on these rights as it is considered part of the
fixed remuneration for services provided by the NED.
De Grey Mining 2023 Annual Report | 61
J. Details of 2022-23 KMP remuneration
Details of the remuneration of the Directors, the key management personnel of the Group.
Short-term
Cash, Salary &
Fees
Cash
Bonus1
Post-
Employment
Share Based Payments
Long term
benefits
Total
Leave
Other
Super
Options
Performance/
Share Rights
Long Service
Leave
% of
remuneratio
n
Performance
Based
$
$
$
$
$
$
$
$
$
%
Directors
Simon Lill
Glenn Jardine
2023
2022
2023
2022
Andrew Beckwith
Paul Harvey2
2023
2022
2023
Samantha Hogg3
Peter Hood
Emma Scotney4
Bruce Parncutt5
Eduard Eshuys6
2023
2022
2023
2022
2023
2023
2022
2023
2022
Sub-total Directors
205,045
181,819
-
-
-
-
552,500
472,500
218,400
140,000
29,751
25,443
315,500
287,584
124,500
118,500
(3,640)
(4,148)
112,074
58,882
57,867
154,375
117,045
54,473
25,341
136,364
25,909
136,364
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2023
2022
1,504,099
342,900
1,389,543
258,500
26,111
21,295
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
19,955
18,181
-
-
27,500
27,500
410,357
165,840
27,500
27,500
276,197
138,452
14,908
6,183
5,787
-
7,955
7,195
2,661
13,636
2,720
13,636
-
-
-
-
-
-
-
-
-
-
7,201
17,132
1,3237
4,3497
5,761
13,705
67,801
-
-
43,605
27,161
23,925
-
-
-
-
-
-
10,428
3,322
12,874
8,814
-
-
-
-
-
-
-
-
-
-
232,201
217,132
1,250,259
838,954
758,692
590,407
194,783
65,065
63,654
197,980
152,161
85,593
28,002
150,000
28,629
150,000
3%
8%
50%
37%
54%
46%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
108,622
686,554
114,195
304,292
149,616
62,347
23,302
12,136
2,841,204
2,162,308
De Grey Mining 2023 Annual Report | 62
Short-term
Cash, Salary
& Fees
Cash
Bonus1
Post-
Employment
Share Based Payments
Long term
benefits
Total
Leave
Other
Super
Options
Performance/ Share
Rights
Long Service
Leave
% of
remuneration
Performance
Based
$
$
$
$
$
$
$
$
$
%
Other Executives
Craig Nelmes
2023
2022
246,500
232,500
56,550
101,200
6,163
14,331
Peter Canterbury
2023
2022
367,500
347,500
117,600
102,000
14,135
15,890
Peter Holmes8
2023
155,930
60,000
11,992
Philip Tornatora
2023
2022
315,500
297,500
111,800
100,800
(2,427)
19,452
Sub-total other executives
2023
2022
1,085,430
345,950
889,280
302,000
29,863
49,673
Total key management personnel compensation
2023
2022
2,589,529
688,850
2,278,823
560,500
55,974
70,968
-
-
-
-
-
-
-
-
-
-
-
27,500
27,500
139,212
63,292
27,500
27,500
333,407
150,873
12,107
-
27,500
27,500
271,769
113,978
4,321
10,279
10,106
5,712
490,352
454,814
-
-
-
-
-
2,712
952
862,854
644,715
162
240,191
11,311
11,898
735,453
571,128
41%
37%
52%
39%
25%
52%
38%
94,607
744,388
82,500
355,587
4,321
10,279
24,291
2,328,850
18,562
1,707,881
203,229
1,430,942
196,695
659,879
153,937
72,626
47,593
5,170,054
30,698
3,870,189
1The FY2023 bonus will be paid in the FY2024 reporting period
2 Paul Harvey was appointed on 4 July 2022
3 Samantha Hogg resigned on 17 October 2022
4 Emma Scotney was appointed on 9 January 2023
5 Bruce Parncutt resigned on 7 September 2022
6 Eduard Eshuys resigned on 8 September 2022
7 Rights issued to Glenn Jardine are issued in 3 tranches, T1 140,846 vested in September 2021, T2 91,008 were forfeited in September 2022 and T3 94,78 are expected to vest in September 2023.
The number of rights to be issued for T2 and T3 have been adjusted for the actual issue.
8 Peter Homes commenced employment on 21 February 2023
De Grey Mining 2023 Annual Report | 63
K. Shareholdings Key Management Personnel - shareholdings, unlisted option
holdings and performance rights holdings
Shareholdings of Key Management Personnel
Opening
Balance
1 July 2022
Received on
exercise
of rights &/or
options3
Held at
resignation
Purchases /
Disposals
during the year
Other changes
during the year
Closing
Balance
30 June 2023
No.
No.
No.
No.
No.
No.
Directors
Simon Lill
Glenn Jardine
Andrew Beckwith
Peter Hood
Paul Harvey
Emma Scotney
Bruce Parncutt1
Eduard Eshuys2
Other executives
13,239,063
-
6,046,668
3,450,000
-
-
-
-
630,566
140,846
563,207
52,227
-
-
52,227
52,227
-
-
-
-
-
-
(52,227)
(52,227)
50,000
30,000
45,000
(297,227)
-
-
-
-
Craig Nelmes
4,993,253
300,000
Peter Canterbury
Peter Holmes
4,000
-
Philip Tornatora
6,448,479
-
-
-
-
-
-
-
(350,000)
25,000
-
(699,670)
Total
34,181,463
1,791,300
(104,454)
(1,196,897)
-
-
-
-
-
-
-
-
-
-
-
-
-
13,919,629
170,846
6,654,875
3,205,000
-
-
-
-
4,943,253
29,000
-
5,748,809
34,671,412
1 Bruce Parncutt resigned on 7 September 2022 and at the time held 52,227 shares.
2 Eduard Eshuys resigned on 8 September 2022 and at the time held 52,227 shares.
3 Shares received on the exercise of 450,454 options carried an exercise price of $0.00. The share price on the date of exercise was $0.81.
Shares received on the exercise of 1,200,000 rights carried an exercise price of $0.00. The share price on the date of exercise was $1.29.
Shares received on the exercise of 140,846 rights carried an exercise price of $0.00. The share price on the date of exercise was $0.90.
Option-holdings of Key Management Personnel
Opening
Balance
1 July
2022
Options
granted
during the
year
Options
exercised
during the
year
Options
forfeited
during the
year
Held at
resignation
No.
No.
No.
No.
No.
Closing
Balance
30 June
2023
No.
Vested and
exercisable
30 June 2023
No.
Directors
Simon Lill
Glenn Jardine
Andrew Beckwith
Paul Harvey
Emma Scotney
Peter Hood
Bruce Parncutt1
Eduard Eshuys2
Other executives
Craig Nelmes
Peter Canterbury
Peter Holmes
130,566
601,425
659,896
-
-
52,227
52,227
52,227
227,058
603,388
-
-
(130,566)
74,822
15,752
-
(163,207)
-
(94,675)
(71,741)
-
-
-
-
-
-
-
(52,227)
(52,227)
(52,227)
-
-
-
-
-
19,629
24,536
-
-
-
-
-
(34,536)
(87,909)
-
(63,862)
Philip Tornatora
436,529
19,629
Total
2,815,543
154,368
(450,454)
(352,723)
1 Bruce Parncutt resigned on 7 September 2022 and at the time held nil options.
2 Eduard Eshuys resigned on 8 September 2022 and at the time held nil options.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
581,572
440,700
-
581,572
440,700
-
-
-
-
-
-
-
-
-
-
212,151
540,015
-
212,151
540,015
-
392,296
392,296
2,166,734
2,166,734
De Grey Mining 2023 Annual Report | 64
Rights-holdings of Key Management Personnel
Opening
Balance
1 July 2022
Rights
granted
during the
year
Rights
exercised
during the
year
Rights
forfeited
during the
year
Other
changes
during the
year3
No.
No.
No.
No.
No.
Closing
Balance
30 June
2023
No.
Vested and
exercisable
30 June
2023
No.
Directors
Simon Lill
Glenn Jardine
Andrew Beckwith
Paul Harvey
Peter Hood
Emma Scotney4
Bruce Parncutt1
Eduard Eshuys2
Other executives
Craig Nelmes
Peter Canterbury
Peter Holmes
Philip Tornatora
500,000
326,592
400,000
-
21,816
-
-
-
300,000
-
-
-
-
-
-
(500,000)
(140,846)
(400,000)
53,177
53,177
-
-
-
-
-
-
-
-
-
-
-
-
(300,000)
-
-
-
-
(91,008)
-
-
-
-
-
-
-
-
-
-
Total
1,548,408
106,354
(1,340,846)
(91,008)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
94,738
-
53,177
74,993
-
-
-
53,177
74,993
-
-
-
-
-
-
-
-
-
-
-
-
-
-
222,908
128,170
1 Bruce Parncutt resigned on 7 September 2022 and at the time held nil rights.
2 Eduard Eshuys resigned on 8 September 2022 and at the time held nil rights.
3 Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 vested in September 2021, T2 91,008 have been forfeited in September
2022 and T3 94,738 are expected to vest in September 2023. The number of rights to be issued for T2 and T3 have been adjusted for
the actual issue.
418,888 share rights will be issued to Emma Scotney following approval at the 2023 AGM.
L. Securities based compensation options and performance rights
Securities based compensation – Options
The Company granted 154,368 (2022: 199,879) 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
Value of
Options
Granted
($)
Vesting
Date
Number
Vested and
exercisable
Maximum
expense to be
recognised in
future years ($)
Glenn Jardine
24 Nov 22
3 Dec 24
Andrew Beckwith
24 Nov 22
3 Dec 24
Craig Nelmes
19 Dec 22
3 Dec 24
Peter Canterbury
19 Dec 22
3 Dec 24
Philip Tornatora
19 Dec 22
3 Dec 24
Glenn Jardine
29 Nov 21
3 Dec 24
Peter Canterbury
21 Dec 21
3 Dec 24
Philip Tornatora
21 Dec 21
3 Dec 24
Peter Canterbury
1 Feb 21
3 Dec 24
Philip Tornatora
4 Dec 20
3 Dec 24
Craig Nelmes
4 Dec 20
3 Dec 24
Andrew Beckwith
4 Dec 20
3 Dec 24
Glenn Jardine
4 Dec 20
3 Dec 24
-
-
-
-
-
-
-
-
-
-
-
-
-
127.5
127.5
123.5
123.5
123.5
124.5
112.0
112.0
74,822
95,398 30 Jun 23
15,752
20,084 30 Jun 23
19,629
24,242 30 Jun 23
24,536
30,302 30 Jun 23
19,629
24,242 30 Jun 23
47,971
59,724 30 Jun 23
55,966
62,682 30 Jun 23
95,942
107,455 30 Jun 23
63,347
13,547
16,881
21,101
16,881
41,255
48,131
82,510
98.0
547,422
536,474 30 Jun 23
470,783
111.5
340,587
379,755 30 Jun 23
292,905
111.5
227,058
253,170 30 Jun 23
195,270
111.5
469,689
553,808 30 Jun 23
427,153
111.5
553,454
617,101 30 Jun 23
475,970
-
-
-
-
-
-
-
-
-
-
-
-
-
De Grey Mining 2023 Annual Report | 65
Options granted to Key management personnel under the shareholder approved Employee Option plans as
both compensation for their past performance and as a mechanism to retain key management personnel.
Options are subject to vesting conditions which are disclosed in Part B, Remuneration Policy.
Securities based compensation – Rights
The Company granted 106,354 (2022: 21,816) share rights 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:
Value per
right at
grant
date
(cents)
Grant
Date
Expiry
Date
Granted
Number
Exercised
Number
Expired
Number
Vesting
Date
Maximum
expense to
be
recognised
in future
years2
Number
Vested
during
the year
Peter Hood
Paul Harvey
4 Jul 22
30 Jun 27
82.0
53,177
24 Nov 22
30 Jun 27
127.5
53,177
-
-
- 30 Jun 23
53,177
- 30 Jun 23
53,177
Andrew Beckwith
20 Dec 17
30 Nov 22
Simon Lill
20 Dec 17
30 Nov 22
Craig Nelmes
20 Dec 17
30 Nov 22
17.0
17.0
17.0
400,000
400,000
- 30 Nov 22
400,000
500,000
500,000
- 30 Nov 22
500,000
300,000
300,000
- 30 Nov 22
300,000
-
-
-
-
-
Emma Scotney1
118,888 share rights will be issued to Emma Scotney following approval at the 2023 AGM.
2A further $281 will be expensed for the 3rd tranche of MD Rights issued to Mr Glenn Jardine that are due to vest on 15 September 2023.
- 30 Jun 23
30 Jun 27
TBC
TBC
TBC
-
-
-
M. Other transactions and balances with Key Management Personnel
De Grey have entered into a number of contracts which resulted in transactions with key management
personnel as follows.
Paid for promotional activities
Paid to relatives of Mr Beckwith
Paid to relatives of Mr Tornatora
2023
$
-
-
-
2022
$
9,961
86,715
81,651
• A related party provided promotional filming and corporate photography services. De Grey employed
a relative of Mr Andrew Beckwith and a relative of Mr Phil Tornatora. None of these employees reported
directly to a KMP.
Terms and conditions of transactions with related parties
Outstanding balances at the yearend are unsecured and interest free and settlement occurs in cash and are
presented as part of trade payables.
----------- End of Audited Remuneration Report -----------
De Grey Mining 2023 Annual Report | 66
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 2023 and the number of meetings attended by each Director are as per the following table:
Directors Meetings
Audit & Risk
Committee1
Remuneration &
Nomination
Committee
Sustainability
Committee2
Eligible Attended
Eligible Attended
Eligible Attended
Eligible Attended
Simon Lill
Glenn Jardine
Andrew Beckwith
Paul Harvey
Peter Hood
Emma Scotney
Samantha Hogg
Eduard Eshuys
Bruce Parncutt
14
14
14
14
14
6
4
2
2
14
14
13
14
14
6
4
2
1
4
-
-
-
4
2
2
-
-
4
-
-
-
4
2
2
-
-
4
-
-
4
4
-
2
-
-
4
-
-
4
4
-
2
-
-
-
-
-
2
2
2
-
-
-
-
-
-
2
2
2
-
-
-
¹ The Committee Chair at the beginning of year was Samantha Hogg, with Peter Hood taking over as Interim Chair from 17 October
2023, then Emma Scotney from 23 February 2023 meeting.
² Committee Chair moved to Paul Harvey from 4 July 2022.
³ Committee Chair was Peter Hood for the full year.
Share Options and Performance rights
At the date of this report there are 3,023,115 unissued ordinary shares in respect of which options are
outstanding and 222,908 performance and share rights outstanding.
Type
Unlisted options
Unlisted options
Share rights
Performance rights
Number
145,515
2,877,600
128,170
94,7381
Exercise Price
Nil cents
Nil cents
N/A
N/A
Expiry Date
31 July 2024
3 December 2024
31 December 2024
23 September 2025
1 Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 vested in September 2021, T2 91,008 were forfeited in September 2022
and T3 94,738 are expected to vest in September 2023. Refer to section B above for further information.
During the financial year 1,233,515 options were issued, 1,811,544 options were exercised, and 618,347
options were forfeited. 201,092 rights were issued, 1,465,846 were exercised, and 216,008 were forfeited.
Since the end of the financial year, nil options have been issued and 631,605 options have been exercised.
Since the end of the financial year nil performance rights have been issued, nil have been exercised and nil
have been forfeited.
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.
Insurance of Directors and Officers
During the financial year, De Grey paid a premium to insure the Directors, officers and joint secretaries 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
De Grey Mining 2023 Annual Report | 67
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.
Indemnification of Auditors
To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young Australia,
as part of the terms of its audit engagement agreement against claims by third parties arising from the audit
(for an unspecified amount). No payment has been made to indemnify Ernst & Young Australia during or
since the financial year.
Non-Audit Services
There were no non-audit services provided by the Group’s current auditor, Ernst & Young, or associated
entities (refer Note 23) in the current year.
Proceedings on behalf of the Company
As at the date of this report there are no leave applications or proceedings booked on behalf of De Grey
under section 237 of the Corporations Act 2001.
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
compliant with all environmental legislation. The Directors of the Group are not aware of any breach of
environmental legislation for the year under review.
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 69.
This report is made in accordance with a resolution of the Directors
Simon Lill
Non-Executive Chairman
Perth, 14 September 2023
Emma Scotney
Chair of the Audit & Risk Committee
De Grey Mining 2023 Annual Report | 68
Audit Independence Declaration
De Grey Mining 2023 Annual Report | 69
Consolidated Statement of Comprehensive Income
FOR THE YEAR ENDED 30 JUNE 2023
Notes
Consolidated
REVENUE & OTHER INCOME
Revenue
Interest income recognised using the effective interest method
Other income
EXPENDITURE
Employee benefits expense
Share based payments expense
Compliance expenses
Corporate advisory and consulting expenses
Administration and other expenses
Depreciation and amortisation
Finance costs
Loss on financial assets
LOSS BEFORE INCOME TAX
INCOME TAX EXPENSE
LOSS FOR THE YEAR
OTHER COMPREHENSIVE INCOME
Items that may be reclassified to profit or loss
2023
$
2022
$
5
5
5
26,705
4,019,617
145,440
31,833
263,135
552,938
6/31
(9,917,789)
(3,770,003)
(2,804,481)
(2,395,810)
(594,720)
(984,778)
(692,768)
(430,879)
(5,068,602)
(2,293,149)
(2,321,825)
(1,640,221)
(123,487)
(1,381,301)
(74,781)
(87,005)
(19,005,221)
(10,536,710)
7
-
-
(19,005,221)
(10,536,710)
Other comprehensive income for the year, net of tax
-
-
TOTAL COMPREHENSIVE LOSS FOR THE YEAR
ATTRIBUTABLE TO EQUITY HOLDERS OF DE GREY MINING
LIMITED
(19,005,221)
(10,536,710)
Basic and diluted loss per share for loss attributable to the
ordinary equity holders of the company (cents per share)
30
(1.25)
(0.77)
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the Notes
to the Consolidated Financial Statements.
De Grey Mining 2023 Annual Report | 70
Consolidated Statement of Financial Position
AT 30 JUNE 2023
Notes
Consolidated
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
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Lease liabilities
Employee benefit obligations
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Lease liabilities
Employee benefit obligations
Rehabilitation provision
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
2023
$
2022
$
112,705,077
63,494,235
1,763,440
1,878,079
179,493
279,071
1,937,598
1,308,943
116,585,608
66,960,328
8,643,565
24,866
307,710,136
233,963,542
11,065,479
1,597,330
8,815,213
1,843,584
329,016,510
244,647,205
445,602,118
311,607,533
24,299,573
18,217,028
511,810
1,192,750
420,745
946,684
26,004,133
19,584,457
1,172,951
1,474,351
149,829
136,625
2,218,266
2,270,954
3,541,046
3,881,930
29,545,179
23,466,387
416,056,939
288,141,146
503,075,924
356,706,505
4,116,798
3,565,203
(91,135,783)
(72,130,562)
416,056,939
288,141,146
8
9
10
11
12
13
14
15
16
17
18
17
18
19
20
21
21
The above Consolidated Statement of Financial Position should be read in conjunction with the Notes to the
Consolidated Financial Statements.
De Grey Mining 2023 Annual Report | 71
Consolidated Statement of Changes in Equity
FOR THE YEAR ENDED 30 JUNE 2023
Notes
Contributed
Equity
Share Based
Payments
Reserves
Accumulated
Losses
Consolidated
$
$
$
Total
$
BALANCE AT 30 JUNE 2022
356,706,505
3,565,203
(72,130,562)
288,141,146
Loss for the year
21(b)
OTHER COMPREHENSIVE INCOME
TOTAL COMPREHENSIVE LOSS
-
-
-
TRANSACTIONS WITH OWNERS IN
THEIR CAPACITY AS OWNERS
Shares issued during the year
Share issue costs
Share based payments
Transfer of reserve on exercise/expiry of
SBP
20(a)
20(a)
21(a)
149,046,000
(4,929,467)
-
2,804,481
21(a)
2,252,886
(2,252,886)
-
-
-
-
-
(19,005,221)
(19,005,221)
-
-
(19,005,221)
(19,005,221)
-
-
-
-
149,046,000
(4,929,467)
2,804,481
-
BALANCE AT 30 JUNE 2023
503,075,924
4,116,798
(91,135,783)
416,056,939
BALANCE AT 30 JUNE 2021
235,892,228
1,339,024
(61,593,852)
175,637,400
Loss for the year
21(b)
OTHER COMPREHENSIVE INCOME
TOTAL COMPREHENSIVE LOSS
TRANSACTIONS WITH OWNERS IN
THEIR CAPACITY AS OWNERS
Shares issued during the year
Share issue costs
Share based payments
Transfer of reserve on exercise/expiry of
SBP
20(a)
20(a)
21(a)
-
-
-
125,976,620
(5,331,975)
-
-
-
-
-
-
2,395,811
(10,536,710)
(10,536,710)
-
-
(10,536,710)
(10,536,710)
-
-
-
-
125,976,620
(5,331,975)
2,395,811
-
21(a)
169,632
(169,632)
BALANCE AT 30 JUNE 2022
356,706,505
3,565,203
(72,130,562)
288,141,146
The above Consolidated Statement of Changes in Equity should be read in conjunction with the Notes to the
Consolidated Financial Statements.
De Grey Mining 2023 Annual Report | 72
Consolidated Statement of Cash Flows
FOR THE YEAR ENDED 30 JUNE 2023
Notes
Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from royalties
Other income received
Payments to suppliers and employees
Interest payments
Interest received
2023
$
2022
$
25,178
252,493
36,542
469,843
(16,013,315)
(6,971,469)
(83,520)
3,250,846
(63,348)
248,465
NET CASH OUTFLOW FROM OPERATING ACTIVITIES
29
(12,568,318)
(6,279,967)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for plant and equipment
Payments for exploration and evaluation expenditure
Payment for equity investment
NET CASH 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
NET CASH INFLOW FROM FINANCING ACTIVITIES
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS
Cash and cash equivalents at the beginning of the financial year
(3,005,173)
(3,543,875)
(68,856,494)
(117,918,538)
(10,000,000)
-
(81,861,667)
(121,462,413)
149,046,000
125,976,620
(4,934,132)
(5,327,352)
(471,041)
(362,353)
143,640,827
120,286,915
49,210,842
63,494,235
(7,455,465)
70,949,700
CASH AND CASH EQUIVALENTS AT THE END OF THE FINANCIAL
YEAR
8
112,705,077
63,494,235
The above Consolidated Statement of Cash Flows should be read in conjunction with the Notes to the
Consolidated Financial Statements.
De Grey Mining 2023 Annual Report | 73
Notes to the Consolidated Financial Statements
FOR THE YEAR ENDED 30 June 2023
1. General Information
De Grey Mining Limited is a company limited by shares, domiciled, and incorporated in Australia. The
registered office and principal place of business of De Grey Mining Limited is Ground Floor, 2 Kings Park
Road, West Perth, WA, 6005. De Grey’s principal activity is focused on the 100% owned Hemi Gold Project in
the Pilbara region of WA, and includes the large scale, high value, near surface 2019 Hemi gold discovery.
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 rounded to the nearest dollar unless
stated otherwise.
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 14 September 2023.
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) as issued by the
International Accounting Standards Board (IASB).
(ii) Historical cost convention
These financial statements have been prepared on a historical cost basis, except for certain financial assets
which have been measured at fair value through profit or loss.
(iii) New or amended Accounting Standards and Interpretations adopted
The Group has adopted all new or amended Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board (‘AASB’) that are mandatory for financial years beginning 1 July 2022.
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.
(iv) New and amended Accounting Standards and Interpretations issued but not yet adopted
Several 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 2023. The Group is assessing the impacts of the amendments; however, the amendments are not
expected to have a material impact on the Group.
De Grey Mining 2023 Annual Report | 74
AASB 2021-5 Amendments to AASs – Deferred Tax related to Assets and Liabilities arising from a Single
Transaction (effective for annual reporting periods beginning after 1 January 2023)
The amendments to AASB 112 clarify that the initial recognition exception would not normally apply. That
is, the scope of this exception has been narrowed such that it no longer applies to transactions that, on
initial recognition, give rise to equal amounts of taxable and deductible temporary differences.
De Grey have considered where this amendment results in changes to the Group’s accounting policies and
updated any required accounting treatments in line with the requirements outlined. There is no impact on
the financial statements.
AASB 2021-28 Amendments to AASB 7, AASB 101, AASB 134 Interim Financial Reporting and AASB Practice
Statement 2 Making Materiality Judgements 9 – Disclosure of Accounting Policies (effective for annual
reporting periods beginning after 1 January 2023)
The amendments to AASB 101 Presentation of Financial Statements require disclosure of material
accounting policy information, instead of significant accounting policies. Unlike ‘material’, ‘significant’ was
not defined in Australian Accounting Standards. The guidance illustrates circumstances where an entity is
likely to consider accounting policy information to be material.
De Grey have considered where this amendment results in changes to the Group’s accounting policies and
updated any required accounting treatments in line with the requirements outlined. There is no impact on
the financial statements.
AASB 2021-2 Amendments to AASB 108 – Definition of Accounting Estimates (effective for annual reporting
periods beginning after 1 January 2023)
The amendments to AASB 108 clarify the definition of an accounting estimate, making it easier to
differentiate it from an accounting policy. The new definition provides that ‘Accounting estimates are
monetary amounts in financial statements that are subject to measurement uncertainty.’
De Grey have considered where this amendment results in changes to the Group’s accounting policies and
updated any required accounting treatments in line with the requirements outlined. There is no impact on
the financial statements.
AASB 2020-1 Amendments to AASs – Classification of Liabilities as Current or Non-current
AASB 2022-6 Amendments to AASs – Non-current Liabilities with Covenants (effective for annual reporting
periods beginning after 1 January 2024)
The amendment clarifies the requirements for classifying liabilities as current or non-current, specifically:
- The amendments specify that the conditions which exist at the end of the reporting period are those
which will be used to determine if a right to defer settlement of a liability exists.
- Managements intention or expectation does not affect the classification of liabilities.
- In cases where an instrument with a conversion option is classified as a liability, the transfer of equity
instruments would constitute settlement of the liability for the purpose of classifying it as current or non-
current.
De Grey will consider where this amendment results in changes to the Group’s accounting policies and look
to update any required accounting treatments in line with the requirements outlined. There is not expected
to be any impact on the financial statements.
De Grey Mining 2023 Annual Report | 75
(i) Going concern
The financial statements have been prepared on the going concern basis, which contemplates the continuity
of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course
of business.
Management have considered the funding and operational status of the business in arriving at their
assessment of going concern and believe that the going concern basis of preparation is appropriate.
B. Accounting policies
Accounting policies have been applied by all entities in the Group and are consistent with those applied in
the prior year. Except as disclosed below, significant accounting policies are contained within the applicable
notes to the Consolidated Financial Statements.
(i)
Foreign currency translation
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.
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.
(ii) Goods and services tax
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.
C. Significant accounting judgements estimates and assumptions
The preparation of the Group’s consolidated financial statements requires management to make judgements,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, the
accompanying disclosures, and the disclosure of contingent liabilities at the date of the consolidated financial
statements. Estimates and assumptions are continually evaluated and are based on management’s experience
and other factors, including expectations of future events that are believed to be reasonable under the
circumstances. Uncertainty about these assumptions and estimates could result in outcomes that require a
material adjustment to the carrying amount of assets or liabilities affected in future periods.
In particular, the Group has identified a number of areas where significant judgements, estimates and
assumptions are required. Further information on each of these areas and how they impact the various
De Grey Mining 2023 Annual Report | 76
accounting policies are described and highlighted separately with the associated accounting policy note
within the related qualitative and quantitative note, as described below.
These include:
• Deferred exploration and evaluation expenditure – Note 13
• Right of use asset & lease liability – Note 15 & 17
• Rehabilitation provision – Note 19
Share based payments – Note 31.
•
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 through the profit or loss – Novo Resources (TSX: NVO)
Consolidated
2023
$
2022
$
8,643,565
8,643,565
24,866
24,866
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 $785,779 (2022: $2,261), while a 10 percent decrease in the AUD/CAD exchange rate would
decrease post tax loss by $960,396 (2022: $2,763).
Price risk
The Group’s listed and equity investments are susceptible to market price risk arising from uncertainties about
future values of the investment securities. The Group manages the market price risk by placing limits on
individual and total equity instruments.
At the reporting date, the exposure to equity investments at fair value listed on the TSX was CAD $7,583,864
(2022: CAD $22,051). Given that the changes in fair values of the equity investments held are correlated with
changes of the TSX market index, the Group has determined that an increase/(decrease) of 10% in the share
De Grey Mining 2023 Annual Report | 77
price could have an impact of $864,356 (2022: $2,487) increase/(decrease) on the income and equity
attributable to the Group.
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 $112,705,077 (2022: $63,494,235) is subject to
interest rate risk. The mix of floating interest rates fluctuates during the year depending on current working
capital requirements. The weighted average interest rate received on cash and cash equivalents by the Group
was 4.56% (2022: 0.39%).
Sensitivity analysis
At 30 June 2023, 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 $880,997
lower/higher (2022: $672,220 lower or $263,135 higher) as a result of lower/higher interest income from cash
and cash equivalents.
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.
Risk management
The Group has adopted the policy of dealing with creditworthy counterparties as a means of mitigating the
risk of financial loss from a counterparty not meeting its obligations. Customer receivables have 30-day
payment term and outstanding receivables are regularly monitored. 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. The carrying amount of the
Group’s financial assets represents the maximum credit risk exposure.
Trade receivables
Counterparties without external credit rating – other
Total trade receivables
Cash and cash equivalents
A + external credit rating
Total cash and cash equivalents
Consolidated
2023
$
2022
$
13,391
13,391
100,639
100,639
112,705,077
63,494,235
112,705,077
63,494,235
Impaired trade receivables
In determining the recoverability of trade and other receivables, the Group performs a risk analysis using a
provision matrix to measure expected credit losses. The provisions rates are based on the type and age of
the outstanding receivable and the creditworthiness of the counterparty. The calculation reflects the
probability-weighted outcome, the time value of money and reasonable and supportable information that is
available at the reporting date about past events, current conditions, and forecasts of future economic
De Grey Mining 2023 Annual Report | 78
conditions. If appropriate, an impairment loss is recognised in profit or loss. The Group does not have any
trade or other receivables that are past due date or impaired as at 30 June 2023 (2022: 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 monitors its rolling cash forecasts and the state
of equity markets in initiating the timing of capital raisings for its future funding requirements.
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.
Less than
6 months
$
24,299,573
277,594
24,577,167
6 – 12
months
$
-
1 – 2
Years
$
-
2 – 5
years
$
-
277,762
277,762
572,016
572,016
639,763
639,763
Total
$
24,299,573
1,767,135
26,066,708
17,676,778
235,922
17,912,700
-
235,922
235,922
-
486,000
486,000
-
17,676,778
1,060,432
2,018,276
1,060,432
19,695,054
As at 30 June 2023
Trade and other payables
Lease liabilities
Total non-derivatives
As at 30 June 2022
Trade and other payables
Lease liabilities
Total non-derivatives
D. Fair value estimation
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 fair value. 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.
Movements in the fair value of financial assets and liabilities may be recognised through the consolidated
statement of comprehensive income.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are
categorised within the fair value hierarchy, described as follows, based on the lowest level input that is
significant to the fair value measurement as a whole:
•
•
•
Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities
Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value
measurement is directly or indirectly observable
Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value
measurement is unobservable
De Grey Mining 2023 Annual Report | 79
The financial assets and liabilities are presented by class in the table below at their carrying amounts.
Financial assets
Fair value
hierarchy
AASB 9 classification
2023
$
2022
$
Investment in listed shares
Level 1
Fair value through profit and loss
8,643,565
24,866
There have been no transfers between fair value levels during the reporting period.
The carrying value of trade receivables and payables approximate their fair values due to their short-term
nature.
3. Capital management
For the purpose of the Group’s capital management, capital includes issued capital, and all other equity
reserves attributable to the equity holders of the parent. 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 2023 and 30 June 2022 are as follows:
Cash and cash equivalents
Trade and other receivables
Trade and other payables
Working capital position
4. Segment Information
Consolidated
2023
$
2022
$
112,705,077
1,763,440
63,494,235
1,878,079
(24,299,573)
(18,217,028)
90,168,944
47,155,286
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
Australia. This segment includes 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.
Recognition and measurement
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.
De Grey Mining 2023 Annual Report | 80
5. Revenue and other income
Revenue
Revenue
Interest income
Other Income
Other income
Consolidated
2023
$
2022
$
26,705
4,019,617
145,440
4,191,762
31,833
263,135
552,938
847,906
Recognition and measurement
Interest Revenue
Interest revenue is recognised as it accrues using the effective interest method.
6. Expenses
Loss before income tax includes the following specific expenses:
Contributions to superannuation funds
Lease liability – interest charge
Share based payments – options
Share based payments – performance rights
Loss on Change in fair value of investment
Consolidated
2023
$
644,851
57,053
2,732,130
72,351
1,381,301
17
31
31
12
2022
$
459,651
57,573
2,226,375
169,436
87,005
Recognition and measurement
Refer to recognition and measurement within Note 12 for equity investments, Note 17 for leases, Note 18 for
employee benefits and Note 31 for share based payments.
De Grey Mining 2023 Annual Report | 81
7.
Income tax
(a) Income tax expense
Current tax expense
Deferred tax expense
Total Income tax expense per income statement
Consolidated
2023
$
-
-
-
2022
$
-
-
-
(b) Numerical reconciliation between tax expense and pre-tax net loss
Net loss before tax
(19,005,221)
(10,536,710)
Corporate tax rate applicable 30% (2022: 30%)
30%
30%
Income tax benefit on above at applicable corporate tax rate
(5,701,566)
(3,161,013)
Increase/(decrease) in income tax due to tax effect of:
Share based payments expense
Non-deductible expenses
Deductible temporary differences not recognised
Effect of Tax rate change at 30%
(c) Recognised deferred tax assets and liabilities
Deferred tax assets
Employee provisions
Other provisions and accruals
Rehabilitation assets and liabilities
Other
Tax losses
Set-off against deferred tax liabilities
Net deferred tax assets
Deferred tax liabilities
Prepayments
Exploration & mine properties
Unearned Income
Gross deferred tax liabilities
Set-off of deferred tax assets
Net deferred tax liabilities
(d) Unused tax losses and temporary differences for which no
deferred tax asset has been recognised
Deductible temporary differences
Tax revenue losses
Tax capital losses
Total unrecognised deductible temporary differences
841,344
29,766
4,830,456
-
-
718,743
18,787
2,423,483
-
-
30%
30%
379,849
2,277,933
10,076
26,229
85,777,135
88,471,222
306,079
174,410
-
15,454
65,402,901
65,898,843
(88,471,222)
-
(65,898,843)
-
-
(88,226,568)
(244,654)
(88,471,222)
(33,967)
(65,850,853)
(14,023)
(65,898,843)
88,471,222
-
65,898,843
-
30%
30%
3,381,664
25,449,684
77,100
28,908,448
2,565,666
20,008,838
77,100
22,651,604
De Grey Mining 2023 Annual Report | 82
The corporate tax rates on both recognised and unrecognised deferred tax assets and deferred tax liabilities
have been calculated with respect to the tax rate that is expected to apply in the year the deferred tax asset
is realised, or the liability is settled.
(e) 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. The head entity of the tax consolidated group is De
Grey Mining Limited. Members of the group have entered a tax sharing arrangement that provides for the
allocation of income tax liabilities between the entities should the head entity default on its tax payment
obligations. At the balance date, the possibility of default is remote.
De Grey Mining Limited and the controlled entities in the tax consolidated group continue to account for
their own current and deferred tax amounts. The Group has applied the group allocation approach in
determining the appropriate amount of current taxes and deferred taxes to allocate to members of the tax
consolidated group. The current and deferred tax amounts are measured in a systematic manner that is
consistent with the broad principles in AASB 112 Income Taxes.
In addition to its own current and deferred tax amounts, De Grey Mining Limited also recognises current tax
liabilities (or assets) and the deferred tax assets arising from unused tax losses and unused tax credits
assumed from controlled entities in the tax consolidated group.
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.
Subsidiaries will recognise any current tax expense equal to the current tax liability and be charged through
intercompany by the head entity.
(f) Franking credits
The company has no franking credits available for use in future years (2022: Nil).
Recognition and measurement
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.
De Grey Mining 2023 Annual Report | 83
Deferred income tax is provided in full, using the full 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.
8. Cash and cash equivalents
Cash at bank & on hand (i)
Short-term deposits (ii)
Consolidated
2023
$
12,266,312
100,438,765
112,705,077
2022
$
32,056,853
31,437,382
63,494,235
(i) Cash at bank earns interest at floating rates based on daily bank deposit rates.
(ii) Short term deposits held for the purposes of meeting short term cash commitments of the Group are made for varying periods
typically between one day and three months depending on the immediate cash requirements of the Group. If the short-term
deposits have an original maturity greater than three months, principal amounts must be able to be redeemed in full prior to
scheduled maturity with no significant penalty otherwise the deposits will be classified as other financial assets. The weighted
average interest rate achieved for the year was 4.56% (2022: 0.39%).
Recognition and measurement
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 that are
readily convertible to known amounts of cash and which are subject to insignificant risk of changes in value.
De Grey Mining 2023 Annual Report | 84
9. Trade and other receivables
Trade and other receivables
GST receivable (net)
Accrued interest
Consolidated
2023
$
80,071
867,856
815,513
1,763,440
2022
$
257,069
1,574,268
46,742
1,878,079
As the majority of receivables are short term in nature, their carrying amount approximates fair value.
Receivables are generally due for settlement within 30 days and held for the business model of collecting
contractual cash flows.
Recognition and measurement
Trade and other receivables
Trade and other receivables 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.
Trade receivables are initially recognised at the transaction price. Other receivables are initially recognised at
fair value plus directly attributable transaction costs. Trade and other receivables are subsequently measured
at amortised cost using the effective interest rate (EIR) method. The measurement of credit impairment is
based on the expected credit loss (ECL) model described below regarding impairment of financial assets.
Impairment of financial assets
The Group recognises a loss allowance for expected credit losses on financial assets which measured at
amortised cost. The ECL is based on the difference between the contractual cash flows due in accordance
with the contract and all the cashflows that the Group expects to receive, discounted at an approximation of
the original EIR.
For trade and other receivables due in less than 12 months, the Group recognises a loss allowance based on
the financial asset’s lifetime ECL at each reporting date. The Group establishes a provision matrix for these
receivables that is based on its historical credit loss experience, adjusted for forward-looking factors specific
to the debtors and the economic environment as sales from product eventuate or significant receivables
come to hand.
The Group considers a financial asset in default when contractual payments are 60 days past due. In certain
cases, the Group may consider a financial asset to be in default when internal or external information indicates
that the Group is unlikely to receive the outstanding contractual amounts in full before taking into account
any credit enhancements held by the Group. A financial asset is written off when there is no reasonable
expectation of recovering the contractual cash flows and usually occurs when past due for more than one
year and not subject to enforcement activity.
De Grey Mining 2023 Annual Report | 85
10. Inventories
Diesel fuel inventories
Consolidated
2023
$
179,493
179,493
2022
$
279,071
279,071
Recognition and measurement
Inventories are valued at the lower of cost and net realisable value. Cost is determined on a weighted average
basis. Any provision for obsolescence or damage is determined by reference to specific stock items identified.
The carrying value of obsolete or damaged items is written down to net realisable value.
11. Other assets
Prepayment – other (i)
Consolidated
2023
$
1,937,598
1,937,598
2022
$
1,308,943
1,308,943
(i)
Prepayments – other includes prepaid insurance premiums for the period 1 July 2023 to 30 April 2024.
12. Financial assets
Financial assets at fair value through profit or loss
Consolidated
2023
$
2022
$
Novo Resources Corp. (TSX: NVO) listed equity securities (i) (ii)
8,643,565
24,866
(i)
24,866
The financial assets are presented as non-current assets unless management intends to dispose of them within 12 months of the
end of the reporting period.
8,643,565
(ii) Financial assets are valued at the quoted closing share price as at reporting date, being CAD $0.215 (2022: CAD $0.44). During the
year, a loss of $1,381,301 (2022: loss of $87,005) was recognised in the consolidated statement of comprehensive income (Note 6).
Recognition and measurement
Equity instruments
Equity instruments are classified as financial assets at fair value through profit or loss. The investments 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.
13. Deferred exploration & evaluation expenditure
Beginning of financial year
Exploration expenditure - all areas of interest (i)
Rehabilitation asset movement
Fuel Tax credit offset
Consolidated
2023
$
233,963,542
74,382,634
(86,273)
(549,767)
307,710,136
2022
$
114,402,821
119,756,940
1,248,724
(1,444,943)
233,963,542
De Grey Mining 2023 Annual Report | 86
(i)
The Group has capitalised all costs associated with The Hemi 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.
At 30 June 2023, the Group conducted an assessment to determine whether there were any indicators of
impairment in relation to the carrying value of its capitalised deferred exploration and evaluation expenditure.
No indicators of impairment were present and therefore the Group did not impair any previously capitalised
expenditure (2022: $Nil).
Recognition and measurement
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; and
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; or
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.
If an area of interest is abandoned or if the Directors consider the expenditure to be of reduced value,
accumulated costs carried forward are written off or impaired in the year in which that assessment is made.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to
carry forward costs in relation to that area of interest. When a decision is made to proceed with development
in a particular area of interest, the relevant exploration and evaluation asset is tested for impairment and the
balance is transferred to mine properties under development.
Significant judgements, estimates and assumptions
The application of the Group’s accounting policy for E&E expenditure requires judgement to determine
whether future economic benefits are likely from either future exploitation or sale, or whether activities have
not reached a stage that permits a reasonable assessment of the existence of reserves. This is assessed both
at tenement level aswell as the area of interest.
In addition to applying judgement to determine whether future economic benefits are likely to arise from the
Group’s E&E assets or whether activities have not reached a stage that permits a reasonable assessment of
the existence of reserves, the Group has to apply a number of estimates and assumptions. The determination
of a JORC (The Australasian Code for Reporting of exploration results, mineral resources and ore reserves)
resource is itself an estimation process that involves varying degrees of uncertainty depending on how the
resources are classified (i.e., measured, indicated or inferred). The estimates directly impact when the Group
defers E&E expenditure.
The deferral policy requires management to make certain estimates and assumptions about future events
and circumstances, particularly, whether an economically viable extraction operation can be established. Any
such estimates and assumptions may change as new information becomes available. If, after expenditure is
capitalised, information becomes available suggesting that the recovery of expenditure is unlikely, the
relevant capitalised amount is written off to the statement of profit or loss and other comprehensive income
in the period when the new information becomes available.
De Grey Mining 2023 Annual Report | 87
14. Property, plant and equipment
Consolidated
Plant &
Equipment
$
Computer
Equipment
$
Furniture
&
Fittings
$
Motor
Vehicles
$
Buildings
$
Medical
Equipment
$
Assets in
Progress
$
Total
$
2023
Gross carrying amount – at cost
Accumulated depreciation
4,815,590
(1,179,043)
1,658,790
(771,229)
809,988
(300,467)
2,012,092
(848,802)
3,477,845
(949,831)
Net book amount
3,636,547
887,561
509,521 1,163,290
2,528,014
-
-
-
2,340,546
-
15,114,851
(4,049,372)
2,340,546
11,065,479
Property, plant and
equipment movement 2023
Opening net book amount
Additions
Completion of assets in
progress
Transfer between categories
Depreciation charge
1,505,852
789,338
518,206
727,655
623,243
31,167
1,172,056
305,789
409,964
9,857
1,543
-
4,584,349
2,201,327
8,815,213
4,065,133
1,819,241
1,543
(479,427)
-
-
(358,300)
-
-
(144,889)
-
-
(314,555)
2,625,889
-
(517,696)
-
(1,543)
-
(4,445,130)
-
-
-
-
(1,814,867)
Closing net book amount
3,636,547
887,561
509,521 1,163,290
2,528,014
-
2,340,546
11,065,479
Consolidated
Plant &
Equipment
$
Computer
Equipment
$
Furniture
&
Fittings
$
Motor
Vehicles
$
Buildings
$
Medical
Equipment
$
Assets in
Progress
$
Total
$
2,205,161
(699,309)
1,505,852
931,135
(412,929)
518,206
1,706,303
778,821
(155,578)
(534,247)
623,243 1,172,056
842,099
(432,135)
409,964
1,850
(307)
1,543
4,584,349
-
4,584,349
11,049,718
(2,234,505)
8,815,213
939,917
909,162
(343,227)
1,505,852
332,469
445,019
(259,282)
518,206
93,690
1,213,417
654,665
259,596
(300,957)
(125,112)
623,243 1,172,056
607,433
-
(197,469)
409,964
-
1,850
(307)
1,543
3,394,356
1,189,993
-
4,584,349
6,581,282
3,460,285
(1,226,354)
8,815,213
2022
Gross carrying amount – at cost
Accumulated depreciation
Net book amount
Property, plant and
equipment movement 2022
Opening net book amount
Additions
Depreciation charge
Closing net book amount
Recognition and measurement
Each class of plant, equipment and motor vehicle is carried at historical cost 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 more than the estimated
recoverable amount from these assets. The recoverable amount is assessed based on 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 property, plant and equipment is calculated using the straight line or reducing balance
method to allocate their cost, net of their residual values, over their estimated useful lives, as follows:
De Grey Mining 2023 Annual Report | 88
Plant and Equipment
Furniture and fittings
Computers
Motor Vehicles
Buildings
4% - 50%
5% - 50%
20% - 50%
17% - 40%
5% - 30%
Straight line
Straight line
Straight line
Reducing balance
Straight line
The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate,
at each reporting date.
15. Right of use asset
Right of use asset – office premises
Gross carrying amount (i)
Accumulated depreciation
Net book amount
Opening net book amount
Additions
Depreciation for the year – leased office premises
Office lease cancelled during the year
Consolidated
2023
$
2022
$
2,518,155
(920,825)
1,597,330
1,843,584
260,705
(506,959)
-
2,257,449
(413,865)
1,843,584
2,223,792
33,657
(413,865)
-
Closing net book amount
(i)
1,843,584
The right of use asset consists of De Grey Mining Limited’s head office lease and does not include the options for office lease term
extensions as it is not reasonably certain the options will be exercised.
1,597,330
(ii) The present value of future lease payments is determined by discounting future lease payments using the incremental borrowing
rate at the commencement date of the lease. The incremental borrowing rate for the lease of the office premise is 3% (2022: 3%).
See Note 17 for associated lease liabilities.
(iii) The expense relating to the short-term leases is $3,022,646 (2022: $8,570,049) which includes $Nil (2022: $6,437,541) of camp site
accommodation. The rental of this accommodation was terminated in July 2022. All short-term lease expenses were capitalised to
deferred exploration and evaluation expenditure (Note 13).
(iv) The total cash outflow for all leases, including short-term leases, was $4,226,463 (2022: $8,306,478).
Recognition and measurement
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.
Right-of-use assets
The Group recognises all right of use assets, except for leases that are short-term (12 months or less) and low
value leases at the lease commencement date. Right-of-use assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-
of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease
payments made at or before the commencement date less any lease incentives received. Right-of-use assets
are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of
the assets.
If ownership of the leased asset transfers to the Group at the end of the lease term or the cost reflects the
exercise of a purchase option, depreciation is calculated using the estimated useful life of the asset.
The right-of-use assets are also subject to impairment.
De Grey Mining 2023 Annual Report | 89
Short-term leases and leases of low-value assets
For leases that are short-term (12 months or less) and/or low value asset 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.
16. Trade and other payables
Trade payables
Other payables and accruals(i)
Consolidated
2023
$
14,355,405
9,944,168
24,299,573
2022
$
16,803,472
1,413,556
18,217,028
(i) Other payables and accruals are non-interest bearing. The amount includes $7M of committed expenditure on Novo Resources
Corporation’s Egina Project (Note 28)
Recognition and measurement
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.
All trade and other creditors are recognised initially at fair value and, in the case of payables, net of directly
attributable transaction costs.
For purposes of subsequent measurement, trade and other creditors are measured at amortised cost.
17. Lease liabilities
Current
Lease liabilities – office premises
Non-current
Lease liabilities – office premises
Carrying value - beginning of the year
Interest expense
Lease payments
Additions
Carrying value - end of the year
Consolidated
2023
$
2022
$
511,810
420,745
1,172,951
1,474,351
1,895,096
57,053
(528,093)
260,705
1,684,761
2,223,792
57,573
(419,926)
33,657
1,895,096
Recognition and measurement
At the commencement date of the lease, the Group recognises lease liabilities measured at the present value
of lease payments to be made over the lease term. The lease payments include fixed payments (including in-
substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an
index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also
include lease extension options and the exercise price of a purchase option that are reasonably certain to be
exercised by the Group and payments of penalties for terminating the lease, if the lease term reflects the
Group exercising the option to terminate.
Variable lease payments that do not depend on an index or a rate are recognised as expenses (unless they
are incurred to produce inventories) in the period in which the event or condition that triggers the payment
occurs.
De Grey Mining 2023 Annual Report | 90
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 incremental borrowing
rate.
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. In addition, the carrying amount of lease liabilities is remeasured if
there is a modification, a change in the lease term, a change in the lease payments (e.g., changes to future
payments resulting from a change in an index or rate used to determine such lease payments) or a change
in the assessment of an option to purchase the underlying asset.
Significant judgements, estimates and assumptions
The group is required to make significant judgements, estimates and assumptions in assessing the lease
liability of the office lease and has used an incremental borrowing rate of 3% and a term of 5 years. However,
the contract provides for an extension of a further 3 years and this has not been included in the calculations
of the lease liability as, at the commencement of the lease, it was not reasonably certain that the option would
be exercised.
18. Employee benefit obligations
Current
Annual Leave (i)
Long Service Leave (i)
Total current Employee benefit obligations
Consolidated
2023
$
1,088,576
104,174
1,192,750
2022
$
946,684
-
946,684
Non-current
Long Service Leave
(i)
136,625
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.
149,829
Recognition and measurement
Wages and salaries and other short-term benefits
Liabilities for wages and salaries and other short term benefits are measured at the amounts expected to be
paid when the liabilities are settled.
Long-term employee benefits
The Group’s liability for long service leave is classified as a long term employee benefit and is measured using
the projected unit credit valuation method. The expected future payments incorporate anticipated future
wage and salary levels, experience of employee departures and periods of service, and are discounted at rates
determined by reference to market yields at the end of the reporting period on high quality corporate bonds
that have maturity dates that approximate the timing of the estimated future cash outflows. Any re-
measurements arising from experience adjustments and changes in assumptions are recognised in profit or
loss in the periods in which the changes occur.
The Group presents employee benefit obligations as current liabilities in the statement of financial position
if the Group does not have an unconditional right to defer settlement for at least twelve (12) months after
the reporting period, irrespective of when the actual settlement is expected to take place.
De Grey Mining 2023 Annual Report | 91
19. Rehabilitation provision
Opening balance
Discount unwind
Movement in rehabilitation for the Withnell Project
Consolidated
2023
$
2,270,954
33,586
(86,274)
2022
$
1,022,230
-
1,248,724
Closing balance
(i)
2,270,954
This provision was brought to account on settlement of the Indee Gold acquisition and covers the mining leases that are subject
of an approved Mine closure plan. The Group assesses its mine rehabilitation provision annually and have prepared an updated
mine closure financial assurance cost estimate for the Withnell Project as at 30 June 2023.
2,218,266
Recognition and measurement
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.
Rehabilitation provision
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 to the extent the estimated future cashflows have not been adjusted for the risks.
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 because 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.
Significant judgements, estimates and assumptions
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. The timing of the rehabilitation activities is
expected to occur between FY2033 and FY2034.
In determining the liability, a discount rate of 4.03% has been applied. Sensitivity analysis was performed to
evaluate the difference by increasing or decreasing the discount rate by +/- 200 basis points which provided
a NPV of $1,835,089 and $2,696,627 respectively.
De Grey Mining 2023 Annual Report | 92
20. Contributed equity
(a) Share capital
2023
2022
Issue
Price
Number of
shares
$
Number of
shares
$
Ordinary shares issued and fully paid
1,561,166,915 503,075,924
1,408,843,525 356,706,505
Total contributed equity
1,561,166,915 503,075,924
1,408,843,525 356,706,505
(b) Movements in ordinary share capital
Beginning of the financial year
Issued during the current & prior years:
Placement share issue(i)
Share Purchase Plan share issue
Shares issued on exercise of options
Shares issued on exercise of rights
Placement share issue
Shares issued on exercise of options
Placement share issue
Transaction costs
Share based payments reserve transfer on exercise
1,408,843,525 356,706,505
1,292,417,061 235,892,228
$1.00
$1.00
$0.00
$0.00
$1.10
$0.35
$1.20
130,000,000 130,000,000
19,046,000 19,046,000
-
1,811,544
-
1,465,846
-
-
-
-
-
-
- (4,929,467)
2,252,886
-
-
-
-
-
-
-
-
-
113,636,364 125,000,000
976,500
120
- (5,331,975)
169,632
-
2,790,000
100
End of the financial year
1,561,166,915 503,075,924 1,408,843,525
356,706,505
(c) Movements in options on issue
Beginning of the financial year
Net issued / (exercised or forfeited) during the year:
− Exercisable at 35 cents, on or before 12 Mar 2022
− Exercisable at 0 cents, on or before 29 July 2022
− Exercisable at 0 cents, on or before 31 July 2023
− Exercisable at 0 cents, on or before 31 July 2024
− Exercisable at 0 cents, on or before 3 Dec 2024
End of the financial year
Unlisted
Unlisted
Unlisted
Unlisted
Unlisted
Number of options
2023
2022
4,851,096 7,463,020
(450,454)
(1,361,090)
777,120
(161,952)
- (2,790,000)
-
(242,150)
-
420,226
3,654,720 4,851,096
(d) Movement in performance/share rights on issue
During the year there were 106,354 unlisted Share Rights issued (2022: 21,816) to Directors of the Group
(Note 31). 18,888 share rights will be issued to Emma Scotney after they are approved by shareholders at the
2023 AGM.
De Grey Mining 2023 Annual Report | 93
2023
Opening balance – 1 July 2022
Share rights issued
Performance rights exercised
Performance rights forfeited
Closing balance – 30 June 2023
2022
Opening balance – 1 July 2021
Share rights issued
Adjustments made during the year – T2
Revised estimate of the provisional rights – T3
Number of performance / share rights
2017
Tranche 4
2021
Tranche
1,2 and 3
Directors
Share
Rights2
Total
1,450,000
326,592
21,816
1,798,408
-
-
106,354
106,354
(1,325,000)
(140,846)
(125,000)
(91,008)
- (1,465,846)
-
(216,008)
-
94,738
128,170
222,908
1,450,000
723,632
-
2,173,632
-
-
-
-
(209,292)1
(187,748)1
21,816
21,816
-
-
(209,292)
(187,748)
Closing balance – 30 June 2022
1,798,408
1Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 vested in September 2021, T2 91,008 have been forfeited in September
2022 and T3 94,738 are expected to vest in September 2023. The number of rights to be issued for T2 and T3 have been adjusted on
the actual issue.
2 18,888 share Rights for services performed during FY23 will be issued to Emma Scotney following approval at the 2023 AGM.
1,450,000
326,592
21,816
1. Tranche 3 - 2021 Vesting conditions for the performance rights issued during 2023 are.
•
•
the Company’s shares reaching a price equal to or greater than 120% of the volume weighted
average price of the Company’s shares. For completeness it is noted the share price target to be
achieved is $1.266; and
The executive remaining employed as Managing Director by the Company as at 15 September 2023.
2. Performance Rights issued in November 2017 – Tranche 4: 1,325,000 vested and have been exercised and
125,000 were forfeited during the year ended 30 June 2023 and had the following vesting conditions:
•
Tranche Four – The Company securing Project Financing for the Hemi Gold Project at a minimum
throughput of 1 million tpa.
3. The Share Rights issued to Directors are in lieu of directors fees and have the following vesting conditions:
•
remaining employed by the Company as at 30 June 2023.
(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
number of authorised shares. Neither the Company, nor any of its subsidiaries, holds any shares in the
Company at 30 June 2023 (2022: Nil).
Recognition and measurement
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. Refer Note 31 for recognition and
measurement of options and performance/share rights.
De Grey Mining 2023 Annual Report | 94
21. 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 (rights) expense (Directors & PR plan)
Transfer to Issued Capital on exercise of options
Balance at end of year
(b) Accumulated losses
Balance at beginning of year
Net loss for the year
Consolidated
2023
$
2022
$
4,116,798
3,565,203
4,116,798
3,565,203
3,565,203
1,339,024
2,732,130
2,226,375
72,351
169,436
(2,252,886)
(169,632)
4,116,798
3,565,203
(72,130,562)
(61,593,852)
(19,005,221)
(10,536,710)
Balance at end of year
(i)
(72,130,562)
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.
(91,135,783)
22. Dividends
No dividends were paid during the financial year (2022: Nil).
No recommendation for payment of dividends has been made.
23. 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
Ernst & Young - audit and review of financial reports
Total remuneration for audit services
Consolidated
2023
2022
$
-
$
-
Consolidated
2023
$
2022
$
73,500
73,500
65,000
65,000
De Grey Mining 2023 Annual Report | 95
24. Contingent liabilities
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.
25. Commitments
(a) Exploration commitments
The Group has certain commitments to meet minimum expenditure requirements on the mineral exploration
assets it has an interest in.
Consolidated
2023
$
2022
$
2,704,400
1,732,320
126,000
126,000
2,830,400
1,858,320
Outstanding Hemi Gold Project exploration commitments are as follows:
Hemi Gold Project tenements (100% owned)
Tenements under option agreements (i)
Annual commitment for the Hemi Gold Project assets
(i)
The tenements that remain under option and/or earn-in agreements are with respect to the Farno McMahon, as detailed in Note
28.
(b) Capital commitments
The Group did not have any capital commitments as at the current or prior balance date.
26. 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 27.
(c) Transactions with related parties
De Grey have entered into a number of contracts which resulted in transactions with key management
personnel as follows:
Transactions with related parties
Paid for promotional activities (i)
Paid to relatives of Mr Beckwith (ii)
Paid to relatives of Mr Tornatora (ii)
2023
$
-
-
-
2022
$
9,961
86,715
81,651
(i) A related party provided promotional filming and corporate photography services.
(ii) Where personnel are employed by De Grey and are considered a related party to key management personnel, those transactions
are entered into in the ordinary course of business at arm’s length.
a. De Grey employed a relative of Mr Andrew Beckwith, the Technical Director of De Grey; and
b. De Grey employed a relative of Mr Phil Tornatora, the General Manager – Exploration of De Grey.
De Grey Mining 2023 Annual Report | 96
None of these employees reported directly to a KMP.
Details of compensation paid to key management personnel are disclosed in the Remuneration Report.
Compensation of key management personnel of the Group
Short term employee benefits
Post-Employment benefits
Termination benefits
Long term benefits
Share based payment transaction
2023
$
2022
$
3,334,353
2,910,291
203,229
196,695
-
47,593
1,584,879
-
30,698
732,505
Total compensation paid to key management personnel
5,170,054
3,870,189
27. 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
Australia
Australia
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Indee Gold Pty Ltd
¹ The proportion of ownership interest is equal to the proportion of voting power held.
Australia
Ordinary
2023
%
100
100
100
100
100
2022
%
100
100
100
100
100
Recognition and measurement
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 2023 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 could 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.
Investments in subsidiaries are accounted for at cost in the separate financial statements of De Grey Mining
Limited.
De Grey Mining 2023 Annual Report | 97
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.
28. Interests in joint operations
Farno McMahon Project Option
Principal place of business: Perth, WA
On 28 July 2017, De Grey secured an option to enter into a joint arrangement 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 exercise
the option. The vendor retains all alluvial rights.
During the 2021 financial year De Grey Mining successfully earned a 75% equity interest in the Farno
McMahon Project and has continued exploration during the 2023 financial year. De Grey Mining Limited will
manage the joint arrangement.
Novo Resources Corporation
On 22 June 2023, De Grey entered into a binding Heads of Agreement (“HOA”) with Novo Resources Corp.
(TSX: NVO, “Novo”) covering the Egina Project, a large land package adjacent to De Grey’s existing large Hemi
Gold Project. The agreement allows De Grey to earn 50% of the Egina Project, by spending A$25M over four
years, with a minimum of A$7M within 18 months. The majority of the 1,034km2 tenement package is located
immediately south of Withnell and southwest of the Hemi discovery (“Egina Project”).
Recognition and measurement
A joint operation is an arrangement in which the Group has joint control, primarily via contractual
arrangements with other parties. In a joint operation, the Group has rights to the assets and obligations for
the liabilities relating to the arrangement. This includes situations where the parties benefit from the joint
activity through a share of the output, rather than by receiving a share of the results of trading. In relation to
the Group’s interest in a joint operation, the Group recognises: its assets and liabilities, including its share of
any assets and liabilities held or incurred jointly; revenue from the sale of its share of the output and its share
of any revenue generated from the sale of the output by the joint operation; and its expenses including its
share of expenses incurred jointly. All such amounts are measured in accordance with the terms of the
arrangement, which is usually in proportion to the Group’s interest in the joint operation.
De Grey Mining 2023 Annual Report | 98
29. Notes to the statement of cash flows
a) 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)
Loss on foreign currency fluctuation
Loss on investment at fair value through profit and loss
Change in operating assets and liabilities
(Increase) in prepayments
(Increase)/decrease in trade and other receivables
Increase/(decrease) in trade and other payables
Increase in provisions
Consolidated
2023
$
2022
$
(19,005,221)
(10,536,710)
2,321,825
2,804,481
6,381
1,381,301
(663,302)
108,940
182,581
294,696
1,640,221
2,395,810
11,433
87,005
(581,797)
(733,105)
1,035,745
401,431
Net cash outflow from operating activities
(12,568,318)
(6,279,967)
30. Loss per share
Consolidated
2023
$
2022
$
(a) Basic and Diluted Loss per Share
Basic and diluted loss per share for loss attributable to the ordinary equity holders
of the company (cents per share)
(1.25)
(0.77)
(b) 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
(19,005,221)
(10,536,710)
(c) 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
1,516,586,762
1,369,724,240
(d) Information on the classification of options
As the Group has made a loss for the year ended 30 June 2023, all options and rights on issue are considered
antidilutive and have not been included in the calculation of diluted earnings per share. These options and
rights could potentially dilute basic earnings per share in the future. There are 3,654,720 unlisted options, all
of which are fully vested at 30 June 2023 and 222,908 unlisted rights, of which 128,170 are full vested at 30
June 2023. 18,888 share rights will be issued to Emma Scotney following approval at the 2023 AGM. The issue
of these rights would further dilute the basic earnings per share once exercised. Since the end of the financial
year, nil options and nil rights have been issued and 631,605 options have been exercised.
Recognition and measurement
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.
De Grey Mining 2023 Annual Report | 99
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.
31. Share-based payments
From time-to-time options and rights are granted to;
(i) Eligible employees under the shareholder approved Performance Rights and Option Plan (PR&OP) of De
Grey Mining Limited (previously under the separate Performance Rights Plan (PRP) and Employee Option
Plan (EOP)) to align their interests with that of the shareholders of the company.
(ii) Directors under rules comparable with the PR&OP, but subject to shareholder approval pursuant to the
provisions of the ASX Listing Rules and the Corporations Act 2001.
(a) Options
Performance rights and Option Plan (‘PR&OP’) of De Grey Mining Limited
Shareholders last approved the PR&OP at the Annual General Meeting held on 29 November 2021. The
PR&OP 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 PR&OP 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.
ZEPO’s have been issued during the year to employees, executives and Directors. The ZEPO’s will vest upon
satisfaction of all of the following non-market vesting conditions, or where, despite vesting conditions not
being satisfied, the Board (in its absolute discretion) resolves that unvested Options have vested:
Executives and Directors ZEPO’s
• Upon the satisfaction of the following project milestones (LTIP Milestones):
a) Delineation of Mineral Resources (as that term is defined in JORC, 2012 Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves) of not less than 12
million ounces of gold at the Company’s Hemi Gold Project (inclusive of the existing regional
2.2 million ounces) as at the date of this Meeting);
b) Completion of a Definitive Feasibility Study (DFS) confirming feasibility for a 500,000 ounces
of gold per annum project through a mine life of no less than 12 years, or such other number
as approved by the Board following completion of a Pre-Feasibility Study. The DFS is to be
signed off in its entirety by a suitably qualified engineering group (with oversight from the
Board); and
c) The Company securing debt and/or equity finance for a Board approved Project arising from
the DFS; and
• Upon the executive achieving a score of 65% or more on the annual short term incentive criteria (STIC),
as determined by the Board annually. If the executive does not achieve the score of 65% or more, 50%
of the Options will be forfeited, whilst the balance will vest solely subject to achieving the LTIP
Milestones.
De Grey Mining 2023 Annual Report | 100
Employee ZEPO’s
• Upon the satisfaction of the following vesting condition:
a) Upon satisfaction of the service period of employment to 30 June 2023, or where, despite
vesting conditions not being satisfied, the Board (in its absolute discretion) resolves that
unvested Options have vested.
b)
There were 90,574 Director options granted (2022: 47,971) and 1,142,941 employee options granted (2022:
372,255) in the financial year ended 30 June 2023. They are all currently outstanding and detailed in the
following table:
Exercise
price
Cents
Balance at
start of the
year
Granted
during the
year
Forfeited
during the
year
Exercised
during the
year
Balance at
end of the
year
Vested and
exercisable at end
of the year1
Grant date
Vesting date
2022-2023
10 Jul 2020
10 Jul 2020
4 Dec 2020
30 Jun 2023
1 Feb 2021
30 Jun 2023
31 May 2021
30 Jun 2022
29 Nov 2021
30 Jun 2023
21 Dec 2021
30 Jun 2023
24 Aug 2022
30 Jun 2023
24 Nov 2022
30 Jun 2023
19 Dec 2022
30 Jun 2023
450,454
0 cents
0 cents 2,071,904
547,422
0 cents
0 cents 1,361,090
47,971
0 cents
372,255
-
-
-
0 cents
0 cents
0 cents
0 cents
4,851,096
2021-2022
12 Mar 2020
10 Jul 2020
4 Dec 2020
1 Feb 2021
31 May 2021
29 Nov 2021
21 Dec 2021
30 Jun 2023
12 Mar 2020 35 cents 2,790,000
450,454
10 Jul 2020
0 cents
0 cents 2,071,904
547,422
0 cents
0 cents 1,603,240
-
0 cents
-
30 Jun 2023
30 Jun 2023
30 Jun 2022
30 Jun 2023
0 cents
7,463,020
-
-
-
-
-
-
927,022
90,574
215,919
1,233,515
-
(290,066)
(76,639)
-
(6,716)
(52,116)
(149,902)
(12,680)
(30,228)
(618,347)
(450,454)
-
-
(1,361,090)
-
-
-
-
-
(1,811,544)
-
1,781,838
470,783
-
41,255
320,139
777,120
77,894
185,691
3,654,720
-
-
-
-
-
47,971
372,255
420,226
-
-
-
-
(242,150)
-
-
(2,790,000)
-
-
-
-
-
-
(242,150)
(2,790,000)
-
450,454
2,071,904
547,422
1,361,090
47,971
372,255
4,851,096
-
1,781,838
470,783
-
41,255
320,139
777,120
77,894
185,691
3,654,720
-
450,454
-
-
1,361,090
-
-
1,811,544
1There are no options that have vested that are not exercisable.
De Grey Mining 2023 Annual Report | 101
Expenses arising from share-based payment transactions - options
The weighted average fair value of the options granted during the year was $1.02 (2022: $1.13). The price
was calculated by using the Black-Scholes European Option Pricing Model applying the following inputs:
2022-2023
Number of options issued
Average exercise price (cents)
Average life of the option (years)
Average underlying share price (cents)
Expected share price volatility
Average risk-free interest rate
Fair value per option (cents)
Total fair value ($) – Life of options issued during 2023
2021-2022
Number of options issued
Average exercise price (cents)
Average life of the option (years)
Average underlying share price (cents)
Expected share price volatility
Average risk-free interest rate
Fair value per option (cents)
Total fair value ($) – Life of options issued during 2022
24 Aug 2022
24 Nov 2022
19 Dec 2022
927,022
0
1.94
94.5
90,574
0
2.03
127.5
215,919
0
1.96
123.5
95%-110%
95%-110%
95%-110%
4.10%
94.5
876,036
4.10%
127.5
115,482
4.10%
123.5
266,660
29 Nov 2021
21 Dec 2021
47,971
0
3.02
124.5
372,255
0
2.96
112.0
95%-110%
95%-110%
0.184%
124.5
59,724
0.184%
112.0
416,926
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.
No assumptions have been made relating to dividends and there are no other inputs to the model. There are
no options that have vested that are not exercisable.
During the year the Board used its discretion and resolved to vest 2,877,600 executive and Director ZEPO’s
with an original vesting date of 3 December 2024. There was no change to the incremental fair value of these
ZEPO’s.
Total expenses arising from equity settled share-based payment transactions recognised during the period
were as follows:
Options issued to Directors and EOP to eligible employees
2,732,130
2,226,375
2023
$
2022
$
(b) Performance rights and Non-Executive Director Share rights
Performance rights and Option Plan (‘PR&OP’) of De Grey Mining Limited
Shareholders last approved the PR&OP at the Annual General Meeting held on 29 November 2021. This
shareholder 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 PR&OP is at the discretion
of the Board and no eligible employee has a contractual right to receive performance rights under the PR&OP.
De Grey Mining 2023 Annual Report | 102
Non-Executive Director Share Plan (‘NED-Share Plan’) of De Grey Mining Limited
Shareholders approved the NED-Share Plan at the Annual General Meeting held on 29 November 2021.
The objective of the NED-Share Plan is to attract, motivate and retain its Non-Executive Directors and the
Company considers that the adoption of the Share Plan and the future issue of Shares Rights under the Share
Plan will provide Non-Executive Directors with the opportunity to participate in the future growth of the
Company.
The performance/share rights granted will be determined by the board prior to granting of the rights, and in
the case of grants to Directors, 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 20 (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.
The following vesting conditions apply to the performance/share rights issued during 2023:
Share rights issued in November 2022 (Approved 29 November 2021 and 24 November 2022):
•
The Director remaining employed by the Company at 30 June 2023.
Rights issued to Glenn Jardine (Managing Director) in September 2022 (granted 10 July 2020) Tranche 3 –
FY2023.
•
The executive remaining employed as the Managing Director by the Company at 15 September 2023,
and
The Company’s share price reaching a price equal to or greater than 120% of the volume weighted
average price at 15 September 2022 and calculated as $1.0555 on the next annual issue date of 15
September 2023.
•
Grant date
Expiry date
Balance at
start
of the year
Number
Granted
during
the year
Number2
Exercised
during the
year
Forfeited
during the
year
Adjustments
made during
the year
Balance at end
of the year
Number
Vested and
exercisable
30 June 2023
2022-2023
20 Dec 2017 30 Nov 2022 1,450,000
10 July 20201 23 Sep 2023
326,592
29 Nov 2021 31 Dec 2026
21,816
4 Jul 2022
30 Jun 2027
-
24 Nov 2022 30 Jun 2027
-
-
-
-
53,177
53,177
(1,325,000)
(140,846)
-
-
-
(125,000)
(91,008)
-
-
-
1,798,408
106,354
(1,465,846)
(216,008)
-
-
-
-
-
-
-
94,738
21,816
53,177
53,177
-
-
21,816
53,177
53,177
222,908
128,170
2021-2022
20 Dec 2017 30 Nov 2022 1,450,000
10 July 2020 23 Sep 2023
723,632
29 Nov 2021 31 Dec 2026
-
-
-
21,816
-
-
-
-
-
-
-
(397,040)1
-
1,450,000
326,592
21,816
-
140,846
21,816
2,173,632
-
1 Rights issued to Mr Jardine are issued in 3 tranches, T1 140,846 vested in September 2021, T2 91,008 was forfeited in September 2022
and T3 94,738 are expected to vest in September 2023. The number of rights to be issued for T3 was adjusted on the actual issue.
2 18,888 share rights will be issued to Emma Scotney after they are approved by shareholders at the 2023 AGM.
1,798,408
(397,404)
162,662
21,816
-
De Grey Mining 2023 Annual Report | 103
Expenses arising from share-based payment transactions – performance/share rights
During the year ended 30 June 2023, 106,354 unlisted share rights were issued to Directors of the Group. As
at the end of the financial year 222,908 performance/share rights remain outstanding.
Number Issued (No.)
Grant Date
Exercise Price ($)
Expiry Date
Vesting date
Underlying Share Price on Grant ($)
Fair value of performance rights
Total Fair Value ($) – Life of Right issued during 2023
Total Fair Value for all rights expensed
4 July 2022
53,177
4 July 2022
-
30 June 2027
30 June 2023
$0.82
$0.82
$43,605
2023
$
72,351
24 November 2022
53,177
24 November 2022
-
30 June 2027
30 June 2023
$1.275
$1.275
$67,801
2022
$
169,436
Recognition and measurement
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 31.
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 a combination of internal and external sources
using a Black-Scholes option pricing model and independent third-party valuations.
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 awards are forfeited because non-market-based vesting
conditions are not satisfied, the expense previously recognised is reversed.
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.
De Grey Mining 2023 Annual Report | 104
32. Events occurring after the reporting date
Subsequent to 30 June 2023, De Grey Mining Limited announced on 13 September 2023 that the Department
of Mines, Industry Regulation and Safety granted Mining Leases 45/1295 and 45/1299 to Domain Mining Pty
Ltd and Mining Leases 45/1294 and 47/1628 to Last Crusade Pty Ltd, being wholly owned subsidiary
companies of De Grey Mining Ltd. The Mining Leases are part of the Hemi Gold Project which hosts the Hemi
deposit.
There have been no other 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 results of those
operations, or the state of affairs of the Group in future financial years.
33. Parent entity information
The following information relates to the parent entity, De Grey Mining Limited, at 30 June 2023. The information presented here
has been prepared using accounting policies consistent with those presented in Note 1.
Parent Entity
2023
$
2022
$
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
Contingent liabilities
116,585,608
329,057,188
66,960,327
244,687,884
445,642,796
311,648,211
25,899,959
3,645,215
29,545,174
19,721,077
3,745,305
23,466,382
503,075,924
4,116,798
(91,095,100)
356,706,505
3,565,203
(72,089,879)
416,097,622
288,181,829
(19,005,221)
-
(19,005,221)
(10,536,710)
-
(10,536,710)
The parent entity had no contingent liabilities as at 30 June 2023 and 30 June 2022.
Capital commitments
The parent entity had no capital commitments as at 30 June 2023 and 30 June 2022.
Accounting policies
The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed
in Note 1.
De Grey Mining 2023 Annual Report | 105
Director’s Declaration
In the Directors’ opinion:
(a)
the financial statements and notes set out on pages 74 to 105 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 consolidated entity’s financial position as at 30 June 2023 and
of its performance for the financial year ended on that date;
(b)
(c)
the audited remuneration report set out on pages 47 to 66 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
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
Non-Executive Chairman
Perth, 14 September 2023
De Grey Minin De Grey Mining 2023 Annual Report | 106
Audit Report
De Grey Minin De Grey Mining 2023 Annual Report | 107
De Grey Minin De Grey Mining 2023 Annual Report | 108
De Grey Minin De Grey Mining 2023 Annual Report | 109
De Grey Minin De Grey Mining 2023 Annual Report | 110
ASX Additional Information
Additional information required by Australian Stock Exchange Ltd, and not shown elsewhere in this report,
is as follows. The information is current as at 14 August 2023.
(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 less than a marketable parcel of shares
are:
Ordinary shares
Number of
holders
Number of shares
2,889
4,325
2,030
3,137
570
12,951
1,790,794
12,292,118
16,043,359
102,772,913
1,428,654,071
1,561,553,255
423
50,157
(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
1
2
3
4
5
6
7
8
9
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
CS THIRD NOMINEES PTY LIMITED
CITICORP NOMINEES PTY LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
NORTHWEST NONFERROUS AUSTRALIA MINING PTY LTD
NATIONAL NOMINEES LIMITED
BNP PARIBAS NOMS PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
BNP PARIBAS NOMINEES PTY LTD
10 Mr Yi Weng & Ms Ning Li
367,476,729
308,009,494
204,232,231
104,788,508
34,715,579
29,410,636
27,695,521
24,342,104
21,963,956
21,296,597
11 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
10,801,010
12 Mr Yi Weng & Ms Ning Li Super A/C's
13 BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
14 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
15 BNP PARIBAS NOMINEES PTY LTD
16 MR ANDREW RHYS JACKSON
17
FIRST SAMUEL LTD ACN 086243567
18 PENAND PTY LTD
19 CAROLINE HOUSE SUPERANNUATION FUND PTY LTD
20 GASCAVON PTY LTD
8,355,603
7,864,979
6,994,029
6,825,642
5,754,091
5,391,135
4,053,334
4,000,000
3,748,809
23.53%
19.72%
13.08%
6.71%
2.22%
1.88%
1.77%
1.56%
1.41%
1.36%
0.69%
0.54%
0.50%
0.45%
0.44%
0.37%
0.35%
0.26%
0.26%
0.24%
1,207,719,987
77.34%
De Grey Minin De Grey Mining 2023 Annual Report | 111
(c) Substantial shareholders
The names of substantial shareholders who have notified the Company in accordance with section 671B of
the Corporations Act 2001 are:
Gold Road Resources Limited
Jupiter Investment Management Limited
(d) Unquoted (unlisted) Securities
Class
Unlisted $Nil options, expiry 31 July 2024
Unlisted $Nil options, expiry 3 December 2024
Performance rights – Series 2 Tranche 3
Share rights
Number of
Shares
281,992,494
93,148,755
%
19.99%
5.96%
Number of
Securities
390,780
3,346,045
Number of
Holders
31
9
Holders of 20% or more of the class
Number of
Securities
Holder Name
Nil
Nil
94,738
128,170
1
2
Glenn Jardine
94,738
Peter Hood
Paul Harvey
74,993
53,177
(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, its subsidiaries (“Group”) and its Board of Directors are committed to achieving and
demonstrating the highest standards of corporate governance. The Board is responsible to its shareholders
for the performance of the Company and seeks to communicate extensively with shareholders. The Board
believes that sound corporate governance practices will assist in the creation of shareholder wealth and
provide accountability. In accordance with ASX Listing Rule 4.10.3, the Company has elected to disclose its
corporate governance policies and its compliance with them on its website, rather than in this Annual Report.
Accordingly, information about the Company's corporate governance practices is set out on the Company's
website at www.https://degreymining.com.au/corporate-governance.
(g) Application of Funds
During the financial year, in accordance with ASX Listing Rule 4.10.19, 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.
De Grey Minin De Grey Mining 2023 Annual Report | 112
Annual Mineral Resources and Ore Reserve
Statement
Ore Reserves – Hemi Mining Centre, May 2022
Deposit
Tonnes
Mt
Proved
Au
g/t
Au
Moz
Oxide
Transition
Sulphide
Total
Probable
Tonnes
Mt
7.3
6.0
90.1
103.4
Au
g/t
1.7
1.7
1.5
1.5
Au
Moz
0.4
0.3
4.4
5.1
Tonnes
Mt
7.3
6.0
90.1
103.4
Total
Au
g/t
1.7
1.7
1.5
1.5
Au
Moz
0.4
0.3
4.4
5.1
Hemi Gold Project - Global Mineral Resource Estimate, June 2023
Measured
Indicated
Inferred
Total
Mining
Centre
Hemi
Mining
Centre
Withnell
Mining
Centre
Wingina
Mining
Centre
Mt
g/t
koz
Mt
g/t
koz
Mt
g/t
koz
Mt
g/t
koz
165.7
1.3
6,876
70.7
1.2
2,632 236.5
1.3
9,508
1.6
1.8
92
15.6
1.6
792
11.9
2.1
797
29.1
1.8
1,681
3.1
1.7
173
2.5
1.5
122
6.3
1.2
243
11.9
1.4
538
Total
4.7
1.7
265
183.8
1.3
7,790
88.9
1.3
3,672 277.4
1.3
11,727
The regional resource estimates at the Withnell and Wingina Mining Centres have not changed since the April 2020 statement, except
Toweranna.
De Grey Minin De Grey Mining 2023 Annual Report | 113
Hemi Gold Project – Global Mineral Resource Estimate by Type, June 2023
Measured
Indicated
Inferred
Total
Mt
g/t
koz Mt
g/t
koz Mt
g/t
koz
Mt
g/t
koz
Mining
Centre
Type
Hemi
Mining
Centre
Oxide
Sulphide
Total
Withnell
Mining
Centre
Wingina
Mining
Centre
Oxide
1.0
1.8
Sulphide
0.7
1.7
Total
Oxide
1.6
2.7
Sulphide
0.4
Total
3.1
1.8
1.8
1.6
1.7
58
35
92
152
21
173
7.8
158.0
165.7
2.9
12.6
15.6
1.8
0.7
2.5
1.5
1.3
1.3
1.3
1.6
1.6
1.5
1.6
1.5
385
0.5
0.9
14
8.3
6,491
70.2
1.2
2,619
228.2
1.4
1.2
399
9,109
6,876
70.7
1.2
2,632
236.5
1.3
9,508
122
1.7
1.3
75
5.6
669
10.2
2.2
722
23.5
792
11.9
2.1
797
29.1
88
35
2.2
1.1
75
4.0
1.3
168
6.7
5.1
122
6.3
1.2
243
11.9
1.4
1.9
1.8
1.5
1.4
1.4
255
1,426
1,681
315
224
538
Oxide
3.7
1.8
210
12.6
1.5
595
4.4
1.1
163
20.6
1.5
968
Total
Sulphide
1.1
1.6
55
171.3
1.3
7,195 84.4 1.3 3,509 256.8 1.3 10,759
Total
4.7
1.7
265
183.8
1.3
7,790 88.9 1.3 3,672 277.4 1.3 11,727
Hemi Gold Project – Mineral Resource Estimate by Mining Centre and Deposit, June
2023
Hemi Mining Centre
Deposit
Type
Oxide
Aquila
Sulphide
Brolga
Total
Oxide
Sulphide
Total
Oxide
Crow
Sulphide
Diucon
Total
Oxide
Sulphide
Total
Oxide
Eagle
Sulphide
Total
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Falcon
Hemi
Mining
Centre
Measured
Indicated
Inferred
Mt
g/t
koz Mt
g/t
koz Mt
g/t
koz
51
580
631
0.1
7.0
7.2
159
1,823
0.1
16.1
1,982
16.2
47
827
874
0.0
7.6
7.6
10
1,580
0.2
16.8
0.7
1.2
1.2
0.8
1.0
1.0
0.7
1.2
1.2
1.1
1.4
3
280
283
2
523
525
1
287
288
7
765
Total
g/t
1.4
1.4
1.4
1.5
1.2
1.3
1.2
1.1
1.1
1.4
1.4
koz
54
860
913
161
2,346
2,507
47
1,114
1,162
17
2,345
Mt
1.2
18.7
19.9
3.4
58.9
62.2
1.3
30.6
31.9
0.4
53.9
1,590
17.1
1.4
773
54.3
1.4
2,363
8
735
743
111
946
0.0
10.7
10.7
0.0
12.0
1,056
12.0
0.7
1.1
1.1
0.0
1.0
1.0
385
0.5
0.9
0
371
371
0
393
393
14
0.2
30.1
30.2
1.9
36.0
37.9
8.3
1.5
1.1
1.1
1.8
1.2
1.2
8
1,106
1,114
111
1,338
1,449
1.4
399
6,491 70.2 1.2 2,619 228.2 1.2 9,109
6,876 70.7 1.2 2,632 236.5 1.3 9,508
1.1
11.6
12.7
3.3
42.7
46.0
1.2
23.0
24.3
0.2
37.1
37.2
0.1
19.4
19.6
1.9
24.1
26.0
7.8
158.0
165.7
1.5
1.5
1.5
1.5
1.3
1.3
1.2
1.1
1.1
1.9
1.3
1.3
1.7
1.2
1.2
1.8
1.2
1.3
1.5
1.3
1.3
De Grey Minin De Grey Mining 2023 Annual Report | 114
Wingina Mining Centre
Deposit
Type
Oxide
Wingina
Sulphide
Mt
Berghaus
Total
Oxide
Sulphide
Total
Oxide
Amanda
Sulphide
Total
2.7
0.4
3.1
0.0
0.0
0.0
0.0
0.0
0.0
Wingina
Mining
Centre
Oxide
2.7
Sulphide
0.4
Total
3.1
Measured
Indicated
Inferred
Total
Mt
g/t
koz Mt
g/t
koz Mt
g/t
koz Mt
g/t
koz
1.8
1.6
1.7
0.0
0.0
0.0
0.0
0.0
0.0
1.8
1.6
1.7
152
21
173
0
0
0
0
0
0
152
21
173
0.6
0.3
1.0
0.7
0.3
1.0
0.5
0.1
0.6
1.8
0.7
2.5
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
16
43
39
14
53
22
4
26
88
35
122
0.3
1.1
1.4
1.0
2.4
3.4
0.9
0.6
1.4
2.2
4.0
6.3
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
57
72
36
92
128
25
19
44
75
168
3.7
1.8
5.5
1.7
2.7
4.3
1.4
0.6
2.0
6.7
5.1
1.6
1.6
1.6
1.4
1.2
1.3
1.0
1.2
1.1
193
94
288
75
106
181
46
23
70
1.5
315
1.4
224
243
11.9
1.4
538
De Grey Minin De Grey Mining 2023 Annual Report | 115
Withnell Mining Centre
Deposit
Type
Withnell
OP
Withnell
UG
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Oxide
Mallina
Sulphide
Toweranna
OP
Toweranna
UG
Total
Oxide
Sulphide
Total
Oxide
Sulphide
Total
Oxide
Camel
Sulphide
Total
Oxide
Calvert
Sulphide
Total
Oxide
Roe
Sulphide
Total
Oxide
Dromedary
Sulphide
Total
Oxide
Leach Pad
Sulphide
Total
Oxide
Hester
Sulphide
Total
Measured
Indicated
Inferred
Total
Mt
g/t
koz Mt
g/t
koz Mt
g/t
koz Mt
g/t
koz
0.6
0.6
1.3
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.2
0.0
0.2
0.0
0.0
0.0
0.1
0.0
0.1
0.1
0.0
0.1
0.0
0.0
0.0
0.0
0.0
0.0
1.4
1.6
1.5
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
2.8
2.1
2.8
0.0
0.0
0.0
2.7
2.5
2.7
2.2
0.0
2.2
0.0
0.0
0.0
0.0
0.0
0.0
28
33
62
0
0
0
0
0
0
0
0
0
0
0
0
16
1
17
0
0
0
5
1
6
7
0
7
0
0
0
0
0
0
0.4
2.7
3.0
0.0
0.1
0.1
0.5
1.1
1.6
0.3
7.6
7.9
0.0
0.3
0.3
0.3
0.1
0.5
0.4
0.6
1.0
0.1
0.1
0.2
0.0
0.0
0.1
0.9
0.0
0.9
0.0
0.0
0.1
1.2
1.9
1.8
0.0
4.3
4.3
1.3
1.2
1.2
1.5
1.6
1.6
0.0
3.0
3.0
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
0.0
0.7
2.1
2.1
2.1
14
163
178
0
16
16
20
44
64
13
384
397
0
24
24
27
6
33
18
24
42
6
5
11
1
2
3
19
0
19
3
1
4
0.2
0.5
0.7
0.0
2.4
2.4
1.2
3.9
5.1
0.1
1.9
2.0
0.0
0.7
0.7
0.0
0.1
0.2
0.1
0.2
0.3
0.1
0.2
0.3
0.0
0.1
0.1
0.0
0.0
0.0
0.0
0.0
0.1
1.1
2.2
2.0
2.5
3.9
3.9
1.4
1.5
1.5
1.6
1.4
1.4
0.0
3.0
3.0
1.1
1.8
1.7
0.8
1.2
1.2
1.6
2.2
2.0
1.6
1.8
1.7
0.0
0.0
0.0
1.3
1.4
1.4
5
38
43
0
301
301
53
190
243
4
85
89
0
68
68
2
9
10
1
9
11
6
15
20
2
5
7
0
0
0
1
2
3
1.1
3.8
5.0
0.0
2.5
2.5
1.7
5.1
6.8
0.4
9.6
9.9
0.0
0.9
0.9
0.5
0.3
0.8
0.5
0.8
1.3
0.3
0.3
0.6
0.2
0.1
0.3
0.9
0.0
0.9
0.1
0.1
0.1
1.3
1.9
1.8
2.5
3.9
3.9
1.3
1.4
1.4
1.5
1.5
1.5
0.0
3.0
3.0
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
0.0
0.7
1.8
1.6
1.7
48
235
283
0
317
317
73
234
307
18
469
487
0
92
92
45
16
60
19
33
52
17
21
38
11
6
17
19
0
19
4
3
7
Withnell
Mining
Centre
Oxide
1.0
Sulphide
0.7
Total
1.6
1.8
1.7
1.8
58
35
92
2.9
12.6
1.3
1.6
122
1.7
1.3
75
5.6
1.4
255
669
10.2
2.2
722
23.5
1.9
1,426
15.6
1.6
792
11.9
2.1
797
29.1
1.8
1,681
De Grey Minin De Grey Mining 2023 Annual Report | 116
Comparison to Previous Mineral Resource Estimate
The MRE update for Hemi was completed in June 2023, and contained 8,517 k ounces in open cut resources
and 991 k ounces in underground resources, for a total of 9.5 M ounces. Comparisons between the June 2023
and May 2022 MREs are provided in the below tables.
Table: Hemi - Mineral Resource statement comparison for open-cut resource above -320 mRL for June 2023
and above -300 mRL for May 2022 (> 0.3 ppm Au).
Category
Measured
Indicated
Inferred
TOTAL
June 2023
May 2022
Variance
Mt
165
51
216
Au
ppm
1.29
1.02
1.23
Au koz
Mt
6,856
1,661
8,517
139
69
208
Au
ppm
1.30
1.02
1.20
Au koz
Mt
Au
ppm
Au
koz
5,801
2,252
8,053
19%
-27%
4%
-1%
1%
2%
18%
-26%
6%
Table: Hemi - Mineral Resource statement comparison for underground resource below -320 mRL for June
2023 (OK estimate) (>1.0 ppm Au) and -300 mRL for May 2022 (LUC estimate) (>1.5 ppm Au).
Category
Measured
Indicated
Inferred
TOTAL
June 2023
May 2022
Variance
Mt
Au
ppm
Au koz
Mt
Au
ppm
Au koz
Mt
Au
ppm
Au
koz
20.7
20.7
1.49
1.49
991
991
5.2
5.2
2.49
2.49
417
417
297%
-40%
138%
297%
-40%
138%
Note that the insignificant amount of Indicated resources below -320 mRL for the June 2023 model have
been included in Inferred.
The most obvious difference is the very significant increase in tonnage and ounces in the Indicated
classification for open cut resources. This is an expected result, as much of the drilling in 2022 and early 2023
was 40 m x 40 m infill, designed specifically to increase confidence in the resource. However, there was also
some extensional drilling at Diucon that increased the overall footprint of the resource.
The amount of Inferred has reduced, as it has been converted to Indicated. Overall, for the open cut resources,
there has been an increase of 4% in tonnes and 6% in contained ounces.
For the underground part of the resource, the tonnes and ounces have increased significantly, with a
reduction in grade, this is primarily a result of the depth extension drilling completed at Diucon and a change
in the reporting cut-off from 1.5 ppm to 1.0 ppm for underground resources. Overall, for the underground
resources, there has been an increase of 297% in tonnes and 138% in contained ounces with grade decreasing
40%.
De Grey Minin De Grey Mining 2023 Annual Report | 117
COMPETENT PERSON STATEMENT
Exploration Results
The information in this report that relates to Exploration Results is based on, and fairly represents
information and supporting documentation prepared by Mr. Phil Tornatora, a Competent Person who is a
Member of The Australian Institute of Geoscientists. Mr. Tornatora is an employee of De Grey Mining Limited.
Mr. Tornatora 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. Tornatora consents to the inclusion in this report of the matters based on his information in the form and
context in which it appears.
Ore Reserves - Hemi
The information in this report that relates to Ore Reserves at the Hemi Gold Project is based on and fairly
represents information and supporting documentation compiled by Mr Quinton de Klerk, a Competent
Person who is a full-time employee of Cube Consulting Pty Ltd, a company engaged by De Grey. Mr de Klerk
is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr de Klerk has sufficient experience which
is relevant to the style of mineralisation and type of deposit under consideration and to the activity which
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 (2012 JORC Code). Mr de Klerk
consents to the inclusion in the report of the matters based on his information in the form and context in
which it appears.
Mineral Resources - Regional
The Information in this report that relates to Wingina and Withnell Mining Centre Mineral Resources
(excluding Toweranna) 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.
Mineral Resources - Hemi
The Information in this report that relates to Hemi Mining Centre and Toweranna Mineral Resources is
based on information compiled by Mr. Michael Job, a Competent Person who is a Fellow of the Australasian
Institute of Mining and Metallurgy. Mr Job is a full-time employee of Cube Consulting. Mr Job 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 Job consents to the
inclusion in the report of the matters based on his information in the form and context in which it appears.
De Grey Minin De Grey Mining 2023 Annual Report | 118
Forward Looking Statements
These materials prepared by De Grey Mining Limited (or the “Company”) include forward looking statements.
Often, but not always, forward looking statements can generally be identified by the use of forward looking
words such as “may”, “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “continue”, and “guidance”, or
other similar words and may include, without limitation, statements regarding plans, strategies and objectives
of management, anticipated production or construction commencement dates and expected costs or
production outputs.
Forward looking statements inherently involve known and unknown risks, uncertainties and other factors that
may cause the Company’s actual results, performance and achievements to differ materially from any future
results, performance or achievements. Relevant factors may include, but are not limited to, changes in
commodity prices, foreign exchange fluctuations and general economic conditions, increased costs and
demand for production inputs, the speculative nature of exploration and project development, including the
risks of obtaining necessary licenses and permits and diminishing quantities or grades of reserves, political
and social risks, changes to the regulatory framework within which the Company operates or may in the
future operate, environmental conditions including extreme weather conditions, recruitment and retention
of personnel, industrial relations issues and litigation.
Forward looking statements are based on the Company and its management’s good faith assumptions
relating to the financial, market, regulatory and other relevant environments that will exist and affect the
Company’s business and operations in the future. The Company does not give any assurance that the
assumptions on which forward looking statements are based will prove to be correct, or that the Company’s
business or operations will not be affected in any material manner by these or other factors not foreseen or
foreseeable by the Company or management or beyond the Company’s control.
Although the Company attempts and has attempted to identify factors that would cause actual actions,
events, or results to differ materially from those disclosed in forward looking statements, there may be other
factors that could cause actual results, performance, achievements or events not to be as anticipated,
estimated or intended, and many events are beyond the reasonable control of the Company. Accordingly,
readers are cautioned not to place undue reliance on forward looking statements. Forward looking
statements in these materials speak only at the date of issue. Subject to any continuing obligations under
applicable law or any relevant securities exchange listing rules, in providing this information the Company
does not undertake any obligation to publicly update or revise any of the forward looking statements or to
advise of any change in events, conditions or circumstances on which any such statement is based.
De Grey Minin De Grey Mining 2023 Annual Report | 119
Schedule of Interests in Mining Tenements
Project/Location
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Farno-McMahon
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Country
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
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Tenement
Percentage
held/earning
E47/891
E45/2533
E45/2364
E45/2983
E45/2995
E45/3390
E45/3391
E45/3392
E45/5140
E45/4751
E45/5808
E47/3552
E47/3553
E47/3554
E47/3750
E47/4565
P45/3029
P47/1866
E47/2502
E47/2720
E47/3504
M47/473
M47/474
M47/475
M47/476
M47/477
M47/480
L45/578
L47/164
L47/165
L45/597
L45/599
L45/600
L45/605
L45/642
L47/1016
L47/1029
L47/1048
L47/1049
L47/1070
L47/1071
L47/971
L47/972
L47/973
L47/976
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
75%¹
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
De Grey Minin De Grey Mining 2023 Annual Report | 120
Project/Location
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Hemi Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Egina Gold Project
Country
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
Australia
Australia
Tenement
L47/977
E47/3399
E47/3428
E47/3429
E47/3430
P47/1732
P47/1733
M47/1626
M47/1628
M45/1294
M45/1295
M45/1299
E45/4948
E47/3318
E47/3321
E47/3625
E47/3646
E47/3673
E47/3712
E47/3773
E47/3774
E47/3775
E47/3776
E47/3780
E47/3782
E47/3783
E47/3812
E47/3945
E47/3962
E47/3963
E47/4056
L47/776
M47/560
M47/561
Percentage
held/earning
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
De Grey has earned a 75% interest in the joint venture agreement with Farno McMahon Pty Ltd (owned 100%
by Novo Resources Corp) details of the agreement can be found in Note 28.
De Grey Minin De Grey Mining 2023 Annual Report | 121