ANNUAL
REPORT
2023
ABN 15 117 3 30 757
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EcoGraf is building a vertically integrated
battery anode materials business to produce
high purity graphite products for the lithium-ion
battery and advanced manufacturing markets.
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Natural Graphite
Natural Graphite
High quality, long life Epanko and
High quality, long life Epanko and
Merelani-Arusha Graphite Projects
Merelani-Arusha Graphite Projects
Battery Anode Material
Battery Anode Material
High performance,
High performance,
low CO2 battery anode material
low CO2 battery anode material
Anode Recycling
Anode Recycling
EcoGraf™ purification technology with
EcoGraf™ purification technology with
sector leading ESG credentials
sector leading ESG credentials
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ANNUAL REPORT 2023 Contents
Chairman's Letter
Review of Operations
Directors' Report
Auditor's Independence Declaration
Financial Statements
Directors' Declaration
Independent Auditor’s Report
Shareholder Information
Summary of Tenements
Mineral Resources and Ore Reserves Information
Corporate Directory
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ECOGRAF LIMITED
Chairman’s Letter
Robert Pett
Independent Non-Executive
Director and Chairman
We have made
substantial
investment and
spent many years
in developing our
graphite assets and
processing technology
to fully exploit these
opportunities and
become a significant
player in graphite
supply, downstream
processing and
recycling.
The future is electric for EcoGraf.
If we are to defeat or moderate climate change, the world needs to rapidly transition to
clean renewable energy combined with green and sustainable manufacturing supply
chains, to materially reduce the worlds carbon footprint. A major support pillar for this
transition is battery storage and electric mobility.
Stimulated by future-looking policy changes and legislation in developed economies,
an unprecedented growth in battery technology and manufacturing is taking place. For
example, in the USA following the Inflation Reduction Act (IRA), $270 billion in planned
clean energy projects have been announced with 30 battery factories either planned,
under construction or operational.
Every battery has an anode and anodes are made from graphite.
Indeed, graphite represents about 50% of total minerals in a lithium-ion battery. Not
just any graphite, but a shaped and highly purified graphite product with very strict
chemical and physical specifications, enabling the anode to perform in the intense
operating conditions of a battery in an Electric Vehicle.
The enormous growth in demand for battery anode graphite can be seen in the recent
forecast by PwC. With demand growing from 200,000tpa in 2021 to 5,000,000tpa in
2035, supply shortages are looming.
These same policy and legislative changes are providing further imperatives for EV
manufacturers in Europe and North America who are already selling a clean green
future, to know their supply chains in fine detail and to ensure that they comply with
legislation. All inputs must be ethically and sustainably produced and sourced from
secure locations. For the battery graphite market this also means a diversification
away from China, which until now, has dominated battery graphite supply.
In addition, similar policies are now being focused on recycling, aimed at closed-loop
manufacturing systems within the battery supply chain.
This is a future full of opportunities for your Company.
EcoGraf does not come late to this party. We have made substantial investment and
spent many years in developing our graphite assets and processing technology to
fully exploit these opportunities and become a significant player in graphite supply,
downstream processing and recycling.
This is encapsulated in the objectives of a clear integrated Business Plan
• To produce high quality natural flake graphite from our superior deposits in
Tanzania, to supply traditional industrial markets and the growing demand for
battery anode material, with ability to expand as demand increases.
• To establish graphite mechanical shaping capacity in Tanzania to access cheap,
renewable hydroelectric power and favourable logistics to produce and export
unpurified spherical graphite with a low carbon footprint along with graphite
by-products, such as our greenRECARB for cleaner steel production.
• To utilise our patented, green purification processing technology, developed
over many years, in purification plants located close to our customers in battery
manufacturing hubs in North America, Europe and Asia.
• To utilise the same purification process for battery graphite recycling.
This integrated Business Plan is currently being executed.
In the USA following the Inflation
Reduction Act (IRA), $270 billion in
planned clean energy projects have
been announced
The recent granting of patent
protection in the USA for our green
purification technology provides
further impetus to this strategy
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ANNUAL REPORT 2023
ANNUAL REPORT 2023
This business plan has received strong endorsement from major EV and battery
manufacturers who are now fully focused on securing sustainable and reliable supply chains.
The Epanko Graphite Project, after some years of delay,
is now ready for development with significantly improved
economics, production profile and expansion capacity.
Starting at 73,000tpa, this project has been subjected to
rigorous bank due diligence and has pre-eminent ESG
credentials, as well as the capacity to expand along with
demand growth to 300,000tpa. The economic value of this
project to your Company and the local Tanzanian economy,
over more than a 40-year life, is profound.
With a radical shift in the investment environment in
Tanzania, and multi-billion-dollar resource and infrastructure
investment in the pipeline, together with the signing of a
very positive framework and partnership agreement with
the Tanzanian government, the pathway to development is
clear.
The President of Tanzania has made it clear that her country
is now “open for business”. The economics of our project
show that graphite in Tanzania is indeed very good business.
This is reflected in the very positive discussions now taking
place on project financing, partnerships and offtake.
Mechanical Shaping in Tanzania is the second plank in our
integrated business plan. To produce battery anode material
(BAM), graphite is subjected to two stages of downstream
processing. Firstly, mined graphite is put through a physical
process of micronising and mechanical shaping to give the
graphite the correct physical specifications and spherical
shape which is necessary for later coating onto anodes.
This is an energy intensive stage. The shaped material then
goes through a second process of chemical purification
to produce the highly purified graphite needed for battery
anodes. EcoGraf has developed its own patented and
eco-friendly process technology for this stage.
With the development of the Epanko Project imminent,
EcoGraf is now in a position to locate the mechanical
shaping in Tanzania with very significant advantages. A
recent independent study shows, by accessing cheap,
renewable Tanzanian hydro-electric power, not only results
in operating cost savings of up to 50% for this energy
intensive stage, but also significantly reduces the carbon
footprint. Also, because in this stage there is only a 60%
recovery of shaped material with the 40% reporting as fines,
there are significant efficiency benefits and freight cost
savings.
Purification can then be performed in smaller plants
located near our customers in EV and battery manufacturing
hubs around the world. This is exactly what our customers
are looking for to secure their supply chains and in some
cases are essential to secure subsidies. In the USA for
example, there is a strong incentive for local processing.
The recent granting of patent protection in the USA for our
green purification technology provides further impetus to
this strategy. EcoGraf is currently scoping potential locations
for this stage and is building a demonstration plant with
Australian government financial support to optimise and
de-risk the process accordingly.
Recycling of battery minerals is gaining momentum.
There are many players engaged in recycling of cathode
minerals, the nickel, cobalt, lithium and manganese, but
it is a clear field in the recycling of anode material. A
significant amount of research and development has been
conducted by EcoGraf to demonstrate that its patented
purification process can be applied to recycle graphite from
end-of-life batteries. Supported by legislative changes and
sustainability programs in the EU and USA, the last leg in our
business plan is for your Company to become a prominent
player in closed-loop recycling of anode graphite.
This business plan has received strong endorsement from
major EV and battery manufacturers who are now fully
focused on securing sustainable and reliable supply chains.
A recent co-operation agreement signed with POSCO
International, supporting our graphite strategy and providing
for battery anode material offtake, is a good example of this
and is echoed in strong interest in offtake, partnerships and
financing across the entire range of our graphite business.
EV and battery manufacturers looking to the future
are focused on securing clean, sustainable supplies of
ethically produced graphite with a low carbon footprint.
We can deliver all that. But this is not enough. We live in
a competitive world and our graphite output at all stages
must be competitive. This means that we must capture all
the efficiencies and cost savings we can across all stages of
mining and processing.
We are truly fortunate to have one of the highest quality
graphite deposits in the world as our primary supply.
This quality is not only a function of superior mineralogy,
facilitating ease of extraction and product quality, but
also a function of a whole matrix of favourable economic
parameters available to us, including mineability, low
processing costs, low power costs and proximity to
infrastructure.
Quality is fundamental to competitive graphite supply, which
it has in common with all industrial minerals. It not only
guarantees high quality end products, but also minimises
production and processing costs all the way from the mine
face to the final product.
Our team is fully focused in maximising these advantages,
streamlining our whole mining and processing chain so that
our final products, including the much in demand battery
anode material, is produced with the highest quality at the
lowest cost and lowest carbon footprint.
In this coming year all the substantial investment already
made in our assets and technology will come into play as
our integrated business plan continues to be executed.
We have a talented team and a sound strategy. Our future is
indeed electric!
Thanks to all for your support and your patience.
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Review of Operations
Mine
Mechanical
Shaping
Purification
Anode
Recycling
Overview
EcoGraf is building a vertically integrated battery anode materials business to produce
high purity graphite products for the lithium-ion battery and advanced manufacturing
markets. Over US$30 million has been invested to date to create a highly attractive
graphite mining and mineral processing business.
In Tanzania, the Company is developing the TanzGraphite natural flake graphite
business, commencing with the Epanko Graphite Project, to provide a long-term,
scalable supply of feedstock for EcoGraf™ battery anode material processing facilities,
together with high quality large flake graphite products for specialised industrial
applications.
Using its environmentally superior EcoGraf HFfree™ purification technology, the
Company will upgrade the flake graphite to produce 99.95%C high performance
battery anode material to supply electric vehicle, battery and anode manufacturers in
Asia, Europe and North America as the world transitions to clean, renewable energy.
Battery recycling is critical to improving supply chain sustainability and the Company’s
successful application of the EcoGraf™ purification process to recycle battery
anode material provides it with a unique ability to support customers to reduce CO2
emissions and lower battery costs.
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ANNUAL REPORT 2023 High growth lithium-ion battery market to drive demand
Demand for LiB forecast to grow
+30% CAGR over next 10 years
Global graphite demand
2021
220 Ktpa
2030
3,120 Ktpa
World Bank reports graphite is the
key raw material to decarbonise
the economy - 53.8%
Million
Tonnes
Natural flake graphite supply vs demand - significant
supply shortages emerging as EV demand ramps up
46.2%
53.8%
Graphite
Other
Natural graphite to increase from
35% to over 50% in anode by 2030
41%
9%
50%
Natural
Synthetic
Other
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9
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7
6
5
4
3
2
1
0
Forecast
demand
Supply gap
looming
Operational
supply
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1
0
2
8
1
0
2
0
2
0
2
2
2
0
2
4
2
0
2
6
2
0
2
8
2
0
2
0
3
0
2
2
3
0
2
4
3
0
2
6
3
0
2
8
3
0
2
0
4
0
2
Sources: World Bank Report, Minerals for Climate Change (https://www.worldbank.org), Benchmark Mineral Intelligence
(www.https://www.benchmarkminerals.com/forecasts/natural-graphite)
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EXTRACT UPGRADE RECYCLE
Review of Operations
POSCO Cooperation Agreement
In May, EcoGraf entered into a non-binding Cooperation Agreement with POSCO
International (POSCO), a multinational industrial company headquartered in South Korea.
The Cooperation Agreement follows a successful technical program between
EcoGraf and POSCO to assess EcoGraf’s graphite product performance and the
on-going discussions between the parties about areas of collaboration to support the
development of EcoGraf’s vertically integrated battery anode materials (BAM) business.
POSCO wishes to secure reliable BAM for its end consumer, POSCO FUTURE M, a
global manufacturer of natural graphite anodes for lithium-ion batteries in electric
vehicles. The Cooperation Agreement recognises the demand for EcoGraf’s BAM with
discussions in progress with POSCO and other battery market participants regarding
long-term offtake and investment arrangements.
The signing of the agreement with POSCO is a significant endorsement of the
Company’s progress and another positive step towards the successful development of
Epanko, where EcoGraf recently completed a pre-development program that delivered
a 22% increase in planned initial production to 73,000tpa and an attractive ungeared,
pre-tax NPV10 of US$348m (A$511m).
There is growing recognition within the battery market of a looming natural graphite
shortfall and in response, our team is evaluating options for a multi-stage expansion of
Epanko, targeting 300,000tpa of production.
EcoGraf and POSCO have agreed to enter into definitive arrangements for the sale and
purchase of EcoGraf’s battery anode material products for an initial term of 10 years from
the commencement of production. EcoGraf will support POSCO battery anode material
requirements by supplying the following indicative volumes of product each year.
Terms to supply Battery Anode Material:
Year
1
Years
2-5
Years
6-10
7,500 – 12,500
tonnes per year
12,500 – 20,000
tonnes per year
20,000 – 40,000
tonnes per year
The parties have also agreed to collaborate in relation to the following key areas:
1. Establishing a
global battery
anode materials
supply chain hub
in Tanzania
• Development and expansion of the Epanko Graphite Mine.
• Development of the Merelani-Arusha Graphite Project.
• Development of battery anode material micronising and
spheronizing facilities to supply unpurified spherical
graphite for purification.
• Development of by-product fines, including EcoGraf’s
GreenRECARB, an induction and electric arc furnace
recarburizer produced from the micronizing and
spheronizing process.
• Engaging POSCO engineering, construction, financing
and investment capabilities.
• Locating EcoGraf™ battery anode material processing
facilities near planned POSCO FUTURE M anode
production developments to ensure logistical and
operational efficiencies.
• Technical collaboration on customized purification
technologies to de-risk the short-term supply chain risk
in South Korea, Europe and North America.
• EcoGraf HFFree™ anode recycling capability.
2. Leveraging
EcoGraf’s
proprietary
graphite
purification
technology
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ANNUAL REPORT 2023
ANNUAL REPORT 2023ECOGRAF LIMITED Terms to supply Battery Anode Material:
EXTRACT
Duma TanzGraphite Natural Graphite Projects
The Epanko Graphite Project (Epanko or the Project) is a long life, highly profitable
graphite project located approximately 370km from the city of Dar es Salaam in Tanzania.
It is forecast to initially produce 73,000 tonnes of natural flake graphite products each
year.
Rigorous evaluation conducted with prospective customers demonstrates that the
unique geology of Tanzanian graphite delivers a superior battery anode material product
that outperforms other global reference materials in mechanical shaping, purification
and electrochemical benchmarking analysis.
Project development highlights:
• Completion of a pre-development program undertaken to build on the extensive
Bankable Feasibility Study, completed in 2017 and which was subjected to rigorous
due diligence by bank appointed Independent Engineers, SRK Consulting (UK)
Limited (SRK Consulting). The results of the pre-development program position the
Project as a world class new graphite development.
• Signing of the Framework Agreement with the Government of Tanzania for the
development and operation of the Epanko Graphite Project.
• Completion of various value engineering programs to enhance and de-risk the
development of Epanko.
• Execution of a non-binding Memorandum of Understanding with Tanzania Electric
Supply Company (TANESCO) for the development of transmission infrastructure
for the supply of grid power to Epanko.
• Selection of short-listed EPCM contractors for the Front End Engineering Design
(FEED) phase. The FEED phase will progress engineering and design to support
procurement activities on major equipment and construction packages in
advance of the final investment decision.
• Drilling and evaluation to support detailed engineering design activities and
expansion studies to achieve Epanko production of 300,000tpa.
• Update of environmental and social planning for the latest Equator Principles 4
global standards.
Multi-stage expansion target
300,000tpa
Forecast mine life
>40 years
Stage 1
Direct employment
300
Stage 1
indirect employment
4,500
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EXTRACT UPGRADE RECYCLE Review of Operations
Twende
Pamoja
Haraka Moja
Kwa Moja (let's
accelerate straight
ahead together!)
Stated by EcoGraf
Managing Director
Andrew Spinks
during his Framework
Agreement Ceremony
speech and repeated
in acknowledgment
from President Dr Samia
Suluhu Hassan
Epanko Framework Agreement
In April 2023 the Company signed a Framework Agreement with the Government of
Tanzania for the development and operation of the Epanko Graphite Project
Signing of the Framework Agreement took place in the presence of Tanzanian
President, Her Excellency Samia Suluhu Hassan, marking a major milestone in the
Company’s plans to develop a new world class natural graphite operation in Tanzania.
Summary of the Key Terms of the Framework Agreement:
• New joint venture entity Duma
• Government and EcoGraf will
TanzGraphite has been incorporated
to develop and operate Epanko, with
an 84% interest held by EcoGraf and
a 16% free-carried interest held by the
Government.
• Existing Epanko licences, project
approvals, environmental approvals,
resettlement action plan and financial
balances are to be transferred from the
Company’s wholly owned subsidiary
TanzGraphite (TZ) Limited to Duma
TanzGraphite. Those transfers will not
be subject to any tax.
• A new Epanko life-of-mine Special
Mining Licence will be issued to Duma
TanzGraphite, a key requirement for
project financiers.
cooperate to secure financing for the
development of Epanko.
• Government will facilitate consents
and approvals for the development
and operation of Epanko.
•
Initial Board of Duma TanzGraphite
consists of three EcoGraf appointees
and two Government appointees.
EcoGraf to appoint the Chairman and
Chief Executive Officer.
• Duma TanzGraphite is not required
to list on the Dar es Salaam Stock
Exchange.
Ceremony at the State House
of The United Republic
of Tanzania, Dodoma
and signing of the Duma
TanzGraphite Framework
Agreement
International Women's Day Invitation
accepted by the Tanzania President
President Dr Samia Suluhu Hassan acknowledging
EcoGraf and accepting the ‘Guest of Honour’
invitation to the 2024 TanzGraphite International
Women’s Day Event (PreIWD) in Dar Es Salaam.
President Samia Suluhu accepted EcoGraf's
invitation to be the guest of honour in her speech
at the Framework Agreement ceremony
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ANNUAL REPORT 2023
ANNUAL REPORT 2023ECOGRAF LIMITED Epanko Project Development
Excellent results from
a pre-development
program to build on
the extensive Bankable
Feasibility Study (BFS),
completed in 2017 and
which was subjected to
rigorous due diligence
by bank appointed
Independent Engineers,
SRK Consulting (UK)
Limited (SRK Consulting).
In completing its 2017 Independent Engineer’s Report, SRK noted that:
• all technical areas of the proposed Epanko development have been
significantly advanced to conform with the requirements of international
project financing standards; and
•
the Environmental and Social Management Planning and supporting
impact assessments conform to relevant Tanzanian legislation,
International Finance Corporation (IFC) Performance Standards and
World Bank Group Environmental, Health and Safety Guidelines.
The results of the pre-development program position the Project as a world
class new graphite development, commencing with Stage 1 followed by
proposed expansion to accommodate the rapid growth in demand forecast
for battery graphite as part of the global transition to clean energy.
The pre-development program builds on the extensive BFS undertaken to
prepare Epanko for construction.
2017
60,000
509
88.9
211
38.9
2023
73,000
508
134
348
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Stage 1 KPIs
Input
Graphite Production
Unit
(Kt)
Operating Cost (C1-FOB)*
(US$/t sold)
Pre-Production Capital
NPV10
IRR
* Includes corporate function costs
(US$m)
(US$m)
%
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GRAPHITE PROJECT
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EPANKO
GRAPHITE PROJECT
Significant
international
investment
pipeline in
Tanzania
Multi-billion dollar
Government infrastructure
program underway to expand
Tanzania's energy, road, rail
and port capacities.
200Km
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EXTRACT UPGRADE RECYCLEARUSHAMTWARAMBEYAHistoric MineTanesco Power Stockpile
Crushing and Grinding
Flotation
Milling and Cleaner Flotation
Concentrate
Screening
Final Product Sizes
Flowsheet simplification to single cleaner flotation stage
Review of Operations
Stage 1 Value Engineering Outcomes
As part of the pre-development program, EcoGraf
completed various metallurgical evaluation studies to
optimise the mine schedule and process flowsheet.
This program identified a number of value adding
opportunities for the Stage 1 development, including:
Oxide first strategy
Oxide ore requires minimal drill and blasting, minimal
crushing/primary milling and uses less reagents compared
to fresh ore. Prioritising the oxide ore also defers the
sulphide circuit and dedicated lined tailings cell that is
proposed for processing of the fresh ore.
Single cleaner flotation stage
The 2017 BFS included an intermediate wet screen followed
by two separate cleaner flotation circuits. Test work
completed by the Company has confirmed that a single
stream cleaner flotation circuit delivers similar performance
to the dual stream circuit but eliminates the need for
intermediate wet screening and provides economies of
scale with a larger single circuit when compared to a dual
circuit.
‘Oxide First’ strategy aims to deliver
a 22% increase in Stage 1 production
capacity to 73,000tpa for minimal
incremental capital cost whilst
metallurgical test work supports
simpler, single line flotation circuit,
reducing capital cost and de-risking
the flowsheet.
Products
Natural Flake Graphite – Jumbo
+50 Mesh (+300μm) – 97.5% Grade*
Natural Flake Graphite – Large
+80 Mesh (-180μm) – 96.5% Grade*
Natural Flake Graphite – Medium
+100 Mesh (+150μm) – 96.0% Grade*
Natural Flake Graphite – Fine
-100 Mesh (-150μm) – 95.5% Grade*
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ANNUAL REPORT 2023
*Typical
Epanko mine site, Mahenge Tanzania
ANNUAL REPORT 2023ECOGRAF LIMITED Grid Power
EcoGraf has entered into a non-binding Memorandum of Understanding with
Tanzania Electric Supply Company (TANESCO) for the development of transmission
infrastructure for the supply of grid power to Epanko.
Under the terms of the agreement, the parties will establish a Joint Technical
Committee to coordinate and manage the design and construction of a 33kV
transmission line from the nearby town of Mahenge to the Project. The line will be
sized to meet future demand growth associated with the future expansion of Epanko.
The collaboration with TANESCO provides for Epanko to benefit from the supply of
cost competitive, clean energy, with hydroelectric power comprising approximately
45% of Tanzania’s energy supply and forecast to increase in the future as part of
broader Government investment in hydro, solar, wind and biomass renewable energy
generation. Independent Life Cycle Assessment (LCA) studies conducted for EcoGraf
confirm electricity accounts for 45-55% of CO2 emissions associated with its battery
anode material products and Tanzanian grid power will deliver a significant competitive
advantage as electric vehicle OEMs seek more sustainable supply chains.
FEED and Project Construction EPCM Arrangements
Following completion of the pre-development value engineering program a rigorous
process is underway to select the EPCM contractor for the Front End Engineering
Design (FEED) phase. The FEED phase will progress engineering design and support
procurement activities on major equipment and construction packages in advance of
the Final Investment Decision. Pleasingly we have seen strong interest from multiple
EPCM contractors who have put forward detailed submissions in support of their
tenders which is a testament to the quality of the Project.
A short-list of preferred contractors have been selected and the FEED phase will be
awarded following negotiation of commercial terms and conditions for the FEED and
Project execution phases. Following a Final Investment Decision by EcoGraf the EPCM
contractor will complete detailed design, manage and expedite major equipment
supply contracts, provide construction management services and support the
successful commissioning of the Project.
Expanded Special Mining Lease, Drilling and Evaluation Program
As provided for in the Epanko Framework Agreement, the Epanko Special Mining
Licence (SML) application has been submitted to the Tanzania Mining Commission and
is progressing well, with active dialogue between the Company and the Government
to ensure that it is approved in a timely manner. The SML application covers an
expanded area of 18.9km2 compared to 9.6km2 for the existing Mining Licence. This
expanded area covers a continuous 5.6km strike length of the Epanko Graphite VTEM
anomaly. This will ensure the SML will be sufficient to allow mine planning for a multi-
decade operation at a potentially significantly expanded capacity. The SML application
has requested a 50-year life for the licence and is supported by the expanded
mineralisation footprint and planned future increased in production capacity.
A drilling and evaluation program to support detailed engineering design and
expansion studies is currently being undertaken. In particular, the extensive
mineralisation to the south of the current western pit design will be evaluated with an
RC program, targeting a significant increase in the resource base to support future
expansion.
An order of magnitude study has been awarded to GR Engineering to evaluate the
expansion of Epanko to approximately 300,000tpa, including an assessment of future
expansion plant location options, economies of scale and infrastructure requirements.
13
EXTRACT UPGRADE RECYCLE Review of Operations
Development Funding
Financial modelling has been completed to update the proposed financing arrangements and prospective
financier information, based on the pre-development program outcomes and is supported by graphite market
studies prepared by independent consultants.
Due to the significant European offtake for Epanko, the Project has been granted eligibility for the German
Government Untied Loan Guarantee (UFK) scheme, which provides long-term funding to facilitate the importation
of critical raw materials into Germany. EcoGraf is advancing the UFK program, with the proposed Epanko loan
arrangements remaining subject to satisfaction of lender credit criteria and approval processes.
In conjunction with the UFK discussions, the Company is also evaluating various government Export Credit Agency
debt funding programs which are based on the country-of-origin for key Epanko equipment and services contracts
and can provide a part of the total Project funding package.
Discussions with potential financiers on both debt and equity funding arrangements for Epanko are ongoing as
part of the program to support the Company’s Final Investment Decision.
Positive Economic Impact
The Project has strong economics and will provide inter-generational
economic and social benefits for the regional community near Mahenge in
Tanzania and will support Tanzania’s positive industrialisation progress.
Epanko is expected to operate for 40+ years and in that time is forecast
to deliver direct economic benefits of over US$3 billion to Tanzania via
employment, procurement, royalties, taxes and dividends. During Stage 1
over 95% of the 300 permanent staff will be Tanzanian, with an estimated
4,500 indirect jobs to be supported by the Epanko operation
Stakeholder engagement at Epanko
traditional leader (Mbui Mlimba)
Sector Leading ESG Credentials
Epanko’s social and environmental planning programs were independently
assessed in 2017 by KfW IPEX-Bank appointed SRK (UK) to comply with
the Equator Principles, a globally recognised risk management framework
adopted by leading financial institutions for assessing and managing social
and environmental risks in new developments.
Achieving this standard and satisfying International Finance Corporation
Performance Standards and World Bank Group Environmental, Health and
Safety Guidelines is critical to securing international financing support for
the new development and reflects EcoGraf’s commitment to ensuring the
highest level of Environmental, Social and Governance operating standards.
A refresh of the Resettlement Action Plan has commenced in preparation for
mine development. An updated valuation report, as required by Tanzanian
law, was prepared with the valuation report approved by the Chief Valuer of
Tanzania. Updated field survey work commenced in June and has involved
extensive engagement with the local community and key stakeholders
including the District Commissioner and local Member of Parliament.
14
ANNUAL REPORT 2023ECOGRAF LIMITED UPGRADE
EcoGrafTM Battery Anode Material
The Company is developing a battery anode material business that will provide a new
supply of high quality purified spherical graphite for the high growth lithium-ion battery
sector, using its EcoGraf HFfree™ purification process developed in Australia and
Germany.
Graphite dominates battery mineral demand by volume, with recent forecasts by
PwC Strategy& in Germany that demand will rapidly grow from 200,000tpa in 2021 to
almost 5 million tpa by 2035.
Supporting the positive outlook for the Company’s graphite project developments are
the recent announcements by the EU Commission and the US Government on policies
and legislation to support new battery mineral supply chains. The biggest impact
arises from release of US Department of Treasury Inflation Reduction Act guidance in
March on new clean vehicle EV tax credit criteria that will shape future critical mineral
supply chains into the US.
These new policies provide opportunities for EcoGraf to supply products for the high
growth North American and European battery markets much sooner than previously
expected, but require a greater focus on ensuring qualifying supply chains for these
regions. As a result of these positive developments, anode and battery manufacturers
are accelerating plans to establish additional capacity to comply with this legislation
and in turn EcoGraf is adapting its development strategy to support their demand
requirements.
This resulted in a change to the Company’s plans for the initial 5,000tpa commercial
demonstration BAM Facility in Western Australia, replacing it with a Product
Qualification Facility which is expected to be commissioned early next year, while
partnering discussions continue under the new legislation with prospective customers
on development of a 20-25,000tpa commercial scale BAM Facility.
As part of optimising our graphite supply chain to support both industrial and battery
markets, we believe there are benefits to undertaking mechanical shaping within an
Export Processing Zone in Tanzania and our team is evaluating potential locations.
Independent Life Cycle Assessment studies confirm there is a ~20% reduction in CO2
emissions during the shaping process by using Tanzania’s cost-competitive hydro-
energy and the country’s location provides an efficient logistics export-hub for global
graphite markets.
Lowest carbon footprint
Synthetic Graphite
Anode Material
23.1 Kg CO2 eq. per kg CSPG
Standard Natural
Graphite Anode Material
14.3 Kg CO2 eq. per kg CSPG
EcoGraf HFfree
Anode Material
5.0 – 10.6 Kg CO2
eq. per kg CSPG
EcoGraf RecoBAM
1.6 – 2.2 Kg CO2
eq. per kg CSPG
0%
20%
40%
60%
80%
100%
EcoGraf HFfree™ Global Warming Potential vs Existing Synthetic Supply (%)
15
EXTRACT UPGRADE RECYCLE
Review of Operations
Global expansion
driven by EV demand
and legislation to
encourage new and
more sustainable
supply chains
Recent activities:
• Optimisation of the process flowsheet, equipment testing and waste
stream management.
• Grant of US patent.
• Award of grant funding of $2.9m under the Federal Government
Critical Minerals Development Program towards a battery anode
material Product Qualification Facility.
• Signing of a Cooperation Agreement with POSCO.
16
1 6
ANNUAL REPORT 2023
ANNUAL REPORT 2023 Product Qualification Facility
EcoGraf has been awarded grant funding of $2.9m
under the Federal Government $48.9m Critical Minerals
Development Program. The funds will be applied towards
the Company’s planned battery anode material Product
Qualification Facility, which will support product testing
activities and offtake discussions with prospective
anode, battery and electric vehicle customers in Europe,
North America and Asia. Federal Minister for Resources
and Northern Australia, the Hon. Madeleine King MP
announced the award of the grant on 18 May 2023, stating
that the successful projects would speed up development
of Australia’s critical minerals sector and assist Australia
and export partners lower emissions and meet net-zero
commitments by 2050.
Following award of the grant, EcoGraf has entered into
a Commonwealth Standard Grant Agreement with the
Department of Industry, Science and Resources, through
which the Commonwealth Government provides grant
funding for up to 50% of eligible project expenditures and
EcoGraf has received the first payment under the funding
arrangement.
Detailed planning and procurement activities are
underway to support the establishment of the new
Product Qualification Facility, which is expected to be
commissioned early next year and is a key step to secure
offtake arrangements for the development of the Company’s
planned commercial scale purification facilities in major
global battery markets.
As a vertically integrated battery anode materials business,
EcoGraf’s planned commercial purification facilities will
source high purity graphite feedstock from its long-life
Epanko Graphite Project in Tanzania. Prospective
customers have shown strong interest in the Company’s
plans to provide a new source of environmentally superior
battery anode material and EcoGraf is delighted that the
Commonwealth Government has chosen to support its
product qualification facility initiative, which is backed by
the Company’s application for the Australian patent for
its EcoGraf HFfree™ purification process. Protection of
EcoGraf’s investment in proprietary processing, innovation
and new technology provides an important competitive
advantage and the development of Australian technologies
supported by patents strongly aligns with the core principles
of the Australian Government’s Critical Minerals Strategy.
The Company will continue its product development
program to maximise the value of its products and support
the global transition to clean energy, given graphite is the
major raw material required.
17
EXTRACT UPGRADE RECYCLE ECOGRAF LIMITED
Review of Operations
Intellectual Property
The Company has sought to protect its intellectual property
assets through the use of patents and trademarks.
During the year EcoGraf received notice from the US Patent and Trademark Office
(USPTO) that its patent application, filed on 1 November 2022, entitled “Method of
Producing Purified Graphite” (US application number 17/626,425) had been examined
and received a ‘Notice of Allowance’ in the USA, with the US patent subsequently
granted on 18 July 2023.
The US patent provides protection for the Company’s processing technology which
has significant strategic value, as any products made (outside of the US) by a patented
process (patented in the US), would be an infringement when imported into the US.
This is a very important step in the proposed commercialisation of EcoGraf HFfree™
technology, providing protection in the US of the patented methodology until about
November 2042. The commercialisation of the technology will also comply with US
Treasury IRA guidance on new clean vehicle credit criteria to strengthen critical mineral
supply chains.
Patent submissions have also been made in other key planned battery manufacturing
regions, including the EU, Korea, Malaysia, Vietnam, East Africa, South Africa and
Australia.
The EcoGraf HFfree™ purification process was developed by the Company in Australia
in 2017 and has since been refined through extensive testing and analysis conducted in
Australia, Europe and Asia.
On 8 November 2021 the Company reported that the International Preliminary
Examining Authority acting under the Patent Co-operation Treaty had deemed all 25 of
the EcoGraf patent claims as novel and inventive. Based on this positive examination
and finding, in December 2021 the Australian Government, through IP Australia,
confirmed acceptance of the Company’s patent application 2021261902 “Method of
producing purified graphite” and published it in the Australian Journal of Patents as part
of a 3-month exposure period during which oppositions can be raised to the proposed
grant of a patent.
Oppositions were lodged with IP Australia by two parties, triggering a process of
evidential review with IP Australia to hold a hearing on the matter later this year.
Tanzanian Mechanical Shaping Study
EcoGraf has undertaken a Mechanical Shaping Study
to evaluate the benefits of establishing an in-country
micronising and spheronising facility, based on the
use of Tanzania’s clean, low cost, hydro power and
logistical efficiencies for transport to major battery
markets in North America and Europe.
International Preliminary
Examining Authority
acting under the Patent
Co-operation Treaty has
deemed all 25 of the
EcoGraf patent claims as
novel and inventive.
18
18
ANNUAL REPORT 2023
ANNUAL REPORT 2023ECOGRAF LIMITED RECYCLE
EcoGraf™ Anode Material Recycling
The Company’s anode recycling programs are supported by legislative developments
to promote closed-loop manufacturing systems within the battery supply chain.
EcoGraf is leveraging its proprietary EcoGraf HFfree™ purification process to recover
and re-use anode materials, with an initial focus on production scrap from anode cell
and battery manufacturing.
Key advances made during the year include:
• evaluation of feedstock supplies with battery manufacturers and electric vehicle
OEM’s to support their sustainability programs in the EU and US; and
• encouraging testwork to develop a universal process flowsheet for the treatment of
recycled anode scrap utilising EcoGraf’s HFfree™ purification process.
LITHIUM-ION
BATTERY(NEW)
ELECTRIC
VEHICLES
CLOSED LOOP
RECYCLING
LITHIUM-ION
BATTERY
(END-OF-LIFE)
ECOGRAF
BAM
RECYCLING
BLACK
MASS
PRODUCTION
SCRAP
PARTNER
PROCESSING
Anode scrap recycling: graphite product before purification containing
Si and Cu impurities and graphite product after EcoGraf purification
19
EXTRACT UPGRADE RECYCLE Review of Operations
20
20
ANNUAL REPORT 2023
Christer Mhingo, Duma TanzGrapite
Director communicating to the
community during recent meetings
ANNUAL REPORT 2023ECOGRAF LIMITED Epanko community
engagement meeting
Environmental, Social and Governance
EcoGraf is committed to ensuring strong environmental, social and governance
standards across all areas of its operations. Its diversified battery anode material
business is founded on a vision to support the global transition to clean,
renewable energy through innovation and sustainability.
The Company has implemented a comprehensive Corporate Governance Plan that provides a framework for the
effective strategic direction and management of its business activities and includes the following:
Charters and Codes
• Board Charter
• Code of Conduct
Policies
• Performance Evaluation Policy
• Continuous Disclosure Policy
• Audit and Risk Committee Charter
• Risk Management Policy
• Nomination and Remuneration
Committee Charter
• Trading Policy
• Diversity Policy
• Shareholder Protection Policy
• Whistle-blower Protection Policy
• Anti-Bribery and Anti-Corruption Policy
In terms of environmental performance, EcoGraf
is a leader within its sector and environmental
sustainability is critical to the successful development
of its businesses and a key priority in its planning and
development decisions.
The Company has led the way within the graphite
market in developing a new, highly effective and
more eco-friendly battery anode material purification
process that can also be applied to recycle battery
anodes.
The charters, codes and policies have been
developed under the guidance of the ASX Corporate
Governance Council’s 4th Edition of the Corporate
Governance Principles and Recommendations, the
Corporations Act 2001 and independent external
advice.
Collectively, they reinforce and promote a culture of
good corporate citizenship across the organisation in
relation to strategic oversight, stakeholder relations,
regulatory compliance, business conduct, personal
behaviours and risk management.
A copy of the Corporate Governance Plan, the annual
Corporate Governance Statement and the EcoGraf
Constitution are available on the Company’s website
at: www.ecograf.com.au.
2121
EXTRACT UPGRADE RECYCLE ECOGRAF LIMITED
Review of Operations
Key environmental aspects of each of the Company’s businesses include:
EcoGraf™ Natural Flake Graphite
• Completion of the Epanko bankable feasibility study in accordance with the Equator
Principles (an internationally recognised risk management framework, adopted by
financial institutions, for determining, assessing and managing environmental and
social risk in projects);
•
Independent review by SRK Consulting confirming that environment and social
planning satisfies the International Finance Corporation Performance Standards and
the World Bank Group Environmental, Health and Safety Guidelines;
• Environmental and social planning update for the latest Equator Principles 4 global
development standards;
• Funding program with international financial institutions linked to stringent
environmental and social performance; and
• Power sourced through Tanzania’s sustainable hydro-facilities.
EcoGraf™ Battery Anode Material
• Development of EcoGraf HFfree™ processing technology to address the industry’s
use of hydrofluoric acid in the manufacture of battery anode material;
• Proposed new state-of-the-art facility engineered to achieve leading international
operating standards;
• Use of Life Cycle Assessment analysis to support global CO2 reduction initiatives;
and
•
Implementation of a zero-waste operating strategy, focussed on an active product
development program to value-add all by-product material produced during
the mechanical shaping and purification of graphite feedstock and to recycle
purification process water and reagents.
EcoGraf™ Lithium-Ion Anode Recycling
• Successful application of the EcoGraf™ purification technique to recover carbon
anode material from lithium-ion battery production waste and end-of-life batteries;
• Opportunity to support global battery recycling initiatives to reduce CO2 emissions
from the manufacture of electric vehicles and to lower battery life cycle costs; and
• Enabling electric vehicle and battery manufacturers to adopt closed-loop
supply chains to maximise production efficiencies and meet stringent legislative
requirements for recycling.
Social responsibility is also fundamental to the success of EcoGraf and a key priority
in its corporate and project development activities. The Company maintains a strong
commitment to stakeholder engagement and actively participates in community and
regional development initiatives.
In Tanzania, development of the Epanko Graphite Project will deliver inter-generational
economic and social benefits over an estimated 40+ years of operation. Nationally,
it is forecast that Stage 1 will contribute over US$3 billion to the Tanzanian economy
through employment, procurement, royalties, taxes and dividends, with over 95% of the
permanent staff to be recruited locally. This will also provide the opportunity for other
benefits through training and development, construction of new community facilities
and support for local businesses and community organisations.
An extensive Resettlement Action Plan has been developed for the Epanko Graphite
Project that includes a comprehensive community investment package consisting
of new and improved housing, upgraded road infrastructure, new school, medical
dispensary, church, related community infrastructure and assistance with the
establishment of sustainable micro-enterprises among village family groups.
EcoGraf™ participates in various research and economic development forums in
Australia and Europe to encourage the discovery of new clean energy technologies
that can accelerate the achievement of global climate change goals and provide new
areas of economic growth and future career opportunities.
Promoting sector leading environmental, social and corporate governance practices
is a key focus for the Company as it continues to expand its operations and generate
sustainable long-term shareholder value.
EcoGraf participates in
various research and
economic development
forums to encourage the
discovery of new clean
energy technologies
22
ANNUAL REPORT 2023 Drilling Team,
Tanzania2023
2323
EXTRACT UPGRADE RECYCLE Directors’ Report
Board of Directors and Executive Management
Robert Pett
Independent Non-Executive Director and Chairman
Robert Pett is a minerals economist with over 30 years’ experience working in exploration and
mining. During this time, he has worked internationally in the resources sector at senior levels
both in Australia and Africa. He has been involved with listed companies at all levels, from grass-
roots exploration through to mine development, production and financing of more than ten mining
projects globally including East and West Africa and the construction of the Golden Pride Gold
Mine in Tanzania.
He was founding Chairman of Resolute Mining Limited (gold mines and exploration Africa
and Australia), Sapphire Mines Limited (gemstone mining and exploration), Reliance Mining
Limited (nickel mining Kambalda), Senex Energy Limited (petroleum production and exploration)
and director of several other mining and exploration companies operating in Africa, Asia and
Australia in gold, base metals, petroleum and uranium.
Robert has also had an active involvement in education and community activities including over
10 years’ service to Murdoch University Western Australia as Senator and Chairman of their
Resources (Finance) Committee.
Andrew Spinks Managing Director
Andrew Spinks is a geologist with over 25 years’ professional experience in Australia, Asia and
Africa on a range of commodities including speciality and industrial minerals.
Andrew has worked in a range of diverse roles across exploration through to successful
project developments and has held a number of board positions on both ASX and TSX.V listed
companies.
Andrew was co-founder of TanzGraphite Pty Ltd and has been Managing Director of EcoGraf
since its acquisition.
John Conidi
Independent Non-Executive Director
John Conidi is a Certified Practicing Accountant. He has over 20 years’ experience developing,
acquiring and managing businesses in the technology and healthcare sectors. In his role as
Managing Director of Capitol Health Limited, he drove its sustained expansion, increasing its
market capitalisation significantly.
John has extensive interests in the graphite sector. He is an experienced investor specialising in
technology and resources and is the Chairman of 333D Limited.
Keith Jones
Independent Non-Executive Director
Keith Jones is a Chartered Accountant with 40 years' experience in the financial markets and
resource industry in Australia.
He has worked across all levels in the corporate arena and acted as expert and advisor for
numerous resource companies in roles encompassing project analysis, valuation, transaction
advisory and governance.
Keith is the former Chairman of Deloitte Australia, current Chairman of ASX listed Coda Minerals
Limited and former Board member of Gindalbie Metals Limited and Ora Banda Mining Limited.
24
ANNUAL REPORT 2023ECOGRAF LIMITED Dale Harris Chief Operating Officer
Mr Harris is an engineer with over 30 years’ industry experience across the resources, mineral
processing and engineering sectors, with a demonstrated track record in successful project
delivery and operational performance.
During a career of almost 20 years with Rio Tinto, Mr Harris held progressively more senior roles
in Australia and overseas in the areas of business planning and analysis, project development,
construction and commissioning, mining and mineral processing operations, business
development, asset management, integrated planning, automation and business improvement.
He was subsequently appointed Managing Director of Gindalbie Metals Limited and then Chief
Executive Officer of its Karara Mining Joint Venture, successfully turning-around the ramp-up of
its multi-billion-dollar mid-west magnetite mining and beneficiation development. More recently,
Mr Harris was a Director of global engineering group Hatch, where he was responsible for
leading the Perth office during a period of significant expansion and growth. During this time
Dale and the Hatch team worked with clients across multiple sectors on the development,
construction, optimisation and management of complex battery minerals, bulk commodity and
base metal projects in Australia and overseas.
Howard Rae Chief Financial Officer and Joint Company Secretary
Howard Rae is a Chartered Accountant with over 20 years’ experience in acquiring, developing,
financing and operating a range of businesses in Australia, Canada, Asia, Africa and Europe.
His career includes Chief Financial Officer roles with a number of successful ASX listed
companies active internationally in the precious and base metals, steel-making materials and
industrial minerals sectors, together with directorships of several unlisted and not-for-profit
organisations.
During this time, he’s been responsible for new business development, joint ventures, structuring
and negotiating corporate, project and infrastructure funding transactions, sales and marketing,
risk management and implementing business improvement programs.
Karen Logan Joint Company Secretary
Karen Logan is a Chartered Secretary with extensive compliance, capital raising, merger and
acquisition, IPO and backdoor listing experience in a diverse range of industries including
resources, technology, media, health care and life science. She has assisted a substantial
number of private start-ups and established businesses transition to being publicly-listed
companies for over 15 years.
25
EXTRACT UPGRADE RECYCLE Directors’ Report
Directors’ Interests and Other Directorships
As at the date of this report, the interests (directly or indirectly held) of the directors in the shares and performance rights of
the Company are:
Director
Term
of office
Interest in
ordinary
shares1
Interest in
performance
rights over
ordinary shares
Australian listed
company
directorships
Former
directorships
(last 3 years)
Independent Non-Executive Director & Chairman
Robert Pett
Director since
9 November 2015
Chairman since
9 November 2015
Executive Director
Andrew
Spinks
Director since
20 July 2012
Managing Director
since 22 April 2015
Independent Non-Executive Directors
3,454,615
1,750,000
None
None
11,998,822
3,224,008
None
None
John Conidi
Director since
4 May 2015
3,019,402
1,750,000
Keith Jones
Director since
23 May 2023
85,000
Nil
333D Limited
(appointed 25
March 2015)
Coda Minerals
Limited
(appointed 26
April 2018)
None
Ora Banda Mining Limited
(April 2019 -
September 2022)
1
Securities interest in EcoGraf – as notified by the directors to the Australian Securities Exchange (“ASX”) in accordance with s.205G(1) of the Corporations Act
2001.
Directors’ Meetings
The number of meetings of the Company’s Board and of each Board committee held during the year ended 30 June 2023,
and the number of meetings attended by each director were:
Directors’ meetings
in person and by resolution
Audit & Risk Committee meetings
in person and by resolution
Number eligible
to attend
Number
attended
Number eligible
to attend
Number
attended
6
6
6
1
6
6
6
1
4
-
4
1
4
-
4
1
Director
Robert Pett
Andrew Spinks
John Conidi
Keith Jones
Operating and Financial Review
The information reported in this operating and financial review should be read in conjunction with the review of operations on
pages 6 to 23.
26
ANNUAL REPORT 2023ECOGRAF LIMITED Principal Activities
EcoGraf is building a vertically integrated battery anode materials business to produce high purity graphite products for the
lithium-ion battery and advanced manufacturing markets. Over US$30 million has been invested to date to create a highly
attractive graphite mining and mineral processing business.
In Tanzania, the Company is developing the TanzGraphite natural flake graphite business, commencing with the Epanko
Graphite Project, to provide a long-term, scalable supply of feedstock for EcoGraf™ battery anode material processing
facilities, together with high quality large flake graphite products for specialised industrial applications.
Using its environmentally superior EcoGraf HFfree™ purification technology, the Company will upgrade the flake graphite to
produce 99.95%C high performance battery anode material to supply electric vehicle, battery and anode manufacturers in
Asia, Europe and North America as the world transitions to clean, renewable energy.
Battery recycling is critical to improving supply chain sustainability and the Company’s successful application of the EcoGraf™
purification process to recycle battery anode material provides it with a unique ability to assist customers to reduce CO2
emissions and lower battery costs. Natural graphite is forecast to remain the major raw material in the lithium-ion battery,
supporting the Company’s scale-up and expansion plans.
Operating Results and Financial Position
The loss after income tax incurred by the consolidated entity for the year ended 30 June 2023 was $7,299,000 (2022: loss
$7,505,000). This loss is largely attributable to downstream processing activities, net of research and development tax credits
and interest received.
The consolidated entity continued to undertake exploration and development activities at the Epanko Graphite Project,
resulting in an increase in exploration and evaluation asset to $22,975,000 (2022: $18,403,000).
At 30 June 2023, net assets of the consolidated entity was $58,896,000 (2022: $63,418,000) and cash reserves of
$38,606,000 (2022: $46,728,000 including term deposits at bank) with no debt.
Dividends
The directors do not recommend the payment of a dividend and no amount has been paid or declared by way of a dividend
to the date of this report (2022: Nil).
Material Business Risk
The Company continually assesses and manages various business risks that could have a material impact on its operating
and financial performance. The following table summarises key areas of material business risk to which the Company is
exposed and the related mitigation strategies that it has adopted.
Risks
Market risk
The risk that changes in demand,
pricing and technology could
adversely impact the volume and
pricing for the Company’s natural
flake, battery anode material and
recycled battery anode products.
Mitigation strategies
The Company rigorously evaluates each product market relevant to its planned
project developments, including commissioning independent market reviews and
long-term forecasts. This information is regularly updated and informs the Company’s
product development and placement strategies.
Development plans are based on securing long-term offtake agreements with
geographically diversified, tier 1 counterparties, underpinned by broader cooperation
commercial and technical arrangements that build strong, long-term relationships to
maximise volume and pricing outcomes.
EcoGraf also engages in extensive research and development to refine its
processing technologies and develop new products. This work is conducted with
leading research organisations that have the expertise to assist the Company
continually improve product performance and production technologies to sustain
value-in-use relative to competing products.
27
EXTRACT UPGRADE RECYCLE Directors’ Report
Risks
Funding risk
The risk of delay and loss
of shareholder value due to
insufficient debt and equity
funding for the Company’s
business activities and
development plans.
Mitigation strategies
The Company has a demonstrated history of raising equity capital to fund its
business activities and at 30 June 2023 had cash resources of $38.6 million. It
has implemented a robust business planning and reporting framework to manage
expenditures, which includes Board approval and oversight of the annual plan
and budget, together with an Audit & Risk Committee to monitor internal control,
reporting, external audit and risk management programs.
As part of assessing the feasibility of its project developments, the Company prepares
detailed financial models and determines its preferred mix of debt and equity funding
to support a final investment decision based on forecast project cash flows.
The process of securing debt capital is managed by EcoGraf personnel experienced
in corporate and project financing, with support from external financial advisors and
specialist consultants, who provide advice and transaction guidance to assist the
Company evaluate and progress various funding options.
Environmental, social and governance risk
The Company maintains a strong commitment to high standards of environmental,
social and governance practice. In Tanzania it works closely with local communities
and the Government to ensure responsible development and has received
independent confirmation that its Epanko environmental and social planning meets
the International Finance Corporation Performance Standards and the World Bank
Group Environmental, Health and Safety Guidelines.
EcoGraf is currently completing additional Epanko environmental and resettlement
activities in compliance with Equator Principles 4 as part of its pre-development
program. The Resettlement Action Plan includes new and improved housing, upgraded
road infrastructure, a new school, medical dispensary and church, related community
infrastructure and assistance with the establishment of sustainable micro-enterprises
among village family groups. These programs are conducted with support from
leading Tanzanian and international environmental and social planning consultants,
together with independent review from consultants appointed by international financial
institutions engaged for the purposes of obtaining project finance.
Duma TanzGraphite Limited, in which the Government of Tanzania has a 16%
shareholding, actively engages with the community surrounding Epanko to support
health and social initiatives, whilst its employment, training and procurement
programs prioritize Tanzanian residents and service providers.
EcoGraf has established a comprehensive Corporate Governance Plan and annually
releases a Corporate Governance Statement on its compliance with ASX Corporate
Governance Principles. Matters of corporate governance, code of conduct and
related policy implementation are a standing item at each Board meeting. The
Company’s Board and Board Committees are comprised of a majority of independent
non-executive directors, who regularly review the effectiveness of the Company’s
governance systems to protect the interests of shareholders and other stakeholders
as its business activities and external operating environment evolve over time.
EcoGraf undertakes comprehensive feasibility study and planning programs, using
the expertise of recognised specialists in various technical disciplines, prior to
making a decision to proceed with a project development.
The risk of financial and
reputational loss, resulting
from business interruption,
delay, additional cost and
stakeholder action due to adverse
environmental, social and
governance incidents.
Operating risk
The risk of accident, error or failure
in mining, processing, mechanical
shaping and purification activities
leading to potential health
and safety incidents, reduced
production levels and additional
costs, impacting personnel welfare
and financial performance.
28
ANNUAL REPORT 2023ECOGRAF LIMITED Risks
Country risk
The risk of changes in political,
regulatory, economic and social
conditions that could adversely
impact the Company’s operating
activities.
Mitigation strategies
At Epanko, following completion of the feasibility study, the Company has engaged
consultants to assist with project execution and operational readiness planning. It has
added internal expertise through the appointment of key project delivery personnel
and is finalising arrangements for the appointment of an EPCM contractor to conduct
front-end engineering and design works, followed by management of the project
execution phase.
The Epanko mining plan and process flowsheet have been determined following
extensive testwork and are based on simple, well-established processes and
commonly used equipment in the graphite mining sector. The selection of EPCM
approach for project delivery enables the Company’s owner’s team to benefit from
external expertise whilst retaining control of the construction program and developing
the internal systems and capabilities to assist with commissioning and operation.
Operational readiness planning is focused on the development of operating
procedures, the selection of systems and the recruitment and training of skilled
personnel necessary to safely and successfully execute the operational phase at
Epanko.
Downstream purification to produce battery anode material was initially
commenced at benchtop scale with extensive research and development, prior
to progressing to small pilot scale, with input from leading Australian Government
research organisations and German graphite expertise. Scale-up risk is being
mitigated through a Product Qualification Facility which is jointly funded via a grant
awarded to EcoGraf under the Australian Federal Government’s Critical Minerals
Development Program. The new facility will enable testing at higher capacities to
de-risk commercial phase planning and to support product qualification programs
and offtake discussions with prospective anode, battery and electric vehicle
manufacturers in Europe, North America and Asia.
EcoGraf is advancing towards development of new graphite mining operations in
Tanzania and is also evaluating the development of downstream purification facilities
for key global battery markets.
Tanzania has a long history of political and social stability, which has supported the
development of an active exploration and mining sector. However, in July 2017 a
range of changes were made to its mining legislation that have caused the Company
significant delay in commencing construction of Epanko due to regulatory uncertainty
and restrictions that impacted on its international project financing arrangements.
Following the appointment of current President Samia Suluhu Hassan in March 2021
Tanzania has revitalised its efforts to attract foreign investment in the mineral sector.
The Company has entered into a Framework Agreement with the Government
of Tanzania under which Epanko will be developed and operated through an
incorporated joint venture, via Duma TanzGraphite Limited, which is owned 84%
by EcoGraf and 16% by the Government. This aligns the interests of each party and
provides greater certainty for project financiers.
EcoGraf’s downstream purification operations are planned to be located in
stable jurisdictions that are actively expanding their critical mineral processing
industries to support the lithium-ion battery market. The Company is in discussions
with prospective partners who can co-develop these new facilities and provide
additional operating and technical expertise in each new market region to manage
development risk. EcoGraf has benefited from strong Australian Government
support through Austrade, Export Finance Australia and other foreign Government
embassies, trade and investment groups that are working to facilitate the
establishment of new, more sustainable critical mineral supply chains to support the
global transition to clean energy.
29
EXTRACT UPGRADE RECYCLE Directors’ Report
Forward looking statements
This report may contain references to forecasts, estimates, assumptions and other forward-looking statements. Although
the Company believes that its expectations, estimates and forecast outcomes are based on reasonable assumptions, it can
give no assurance that they will be achieved. They may be affected by a variety of variables and changes in underlying
assumptions that are subject to risk factors associated with the nature of the business, which could cause actual results to
differ materially from those expressed in this report. Investors should rely upon their own enquiries before deciding to acquire
or deal in the Company’s securities.
Significant Changes in State of Affairs
Significant changes in the state of affairs of the consolidated entity during the year (if any) are contained in the review of
operations and financial statement sections of this report.
Significant Events After the Balance Date
No matters or circumstances have arisen since 30 June 2023 that have significantly affected or may significantly affect:
• the consolidated entity’s operations in future financial years;
• the results of those operations in future financial years; or
• the consolidated entity’s state of affairs in future financial years.
Future Developments, Prospects and Business Strategies
Likely future developments in the activities of the Company are referred to in the review of operations section of this report.
Environmental Issues
The Company’s operations are subject to environmental regulation under the laws of the Commonwealth of Australia and
Republic of Tanzania. The directors believe that the Company has adequate systems in place for environmental management
and are not aware of any breach of environmental requirements as they apply to the Company.
Proceedings on Behalf of the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf
of the Company, or to intervene in any proceedings to which the Company is a party, for the purposes of taking responsibility
on behalf of the Company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section 237 of
the Corporations Act 2001.
Indemnifying Directors and Officers
The Company has entered into an agreement to indemnify all directors and officers against any liability arising from a claim
brought by a third party against the Company. The Company has paid premiums to insure each director and officer against
liabilities for costs and expenses incurred by them in defending any legal proceedings arising out of their conduct while
acting in the capacity of director and officer of the Company, other than as a result of conduct involving a willful breach of
duty in relation to the Company. The agreement contains a prohibition on disclosure of the amount of the premium and the
nature of the liabilities under the policy.
Indemnification of Auditors
To the extent permitted by law, the Company has agreed to indemnify its auditors, RSM Australia Partners, as part of the
terms of its audit engagement agreement, against claims by third parties arising from the audit (for an unspecified amount).
No payments have been made to indemnify RSM Australia Partners to the date of this report.
30
ANNUAL REPORT 2023ECOGRAF LIMITED Non-Audit Services
The directors are satisfied that the provision of non-audit services is compatible with the general standard of independence for
auditors imposed by the Corporations Act 2001. The directors ensure that:
• non-audit services are reviewed and approved to ensure that the provision of such services does not adversely affect the integrity
and objectivity of the auditor, and
• audit services do not compromise the general principles relating to auditor independence in accordance with APES 110: Code of
Ethics for Professional Accountants set by the Accounting Professional and Ethical Standards Board.
The total remuneration for audit and non-audit services provided during the prior and current financial years is set out in note 17 of
the consolidated financial statements.
Auditor’s Independence Declaration
The auditor’s independence declaration as required under section 307C of the Corporations Act 2001, is set-out on page 40 of this
report.
Rounding
The amounts contained in this report and in the consolidated financial statements have been rounded to the nearest $1,000 (unless
otherwise stated) under the option available to the Company under ASIC Corporations (Rounding in Financial/Directors’ Reports)
Instrument 2016/191. The Company is an entity to which the legislative instrument applies.
Corporate Governance
The directors of EcoGraf are responsible for the corporate governance of the Company and have applied ASX Corporate
Governance Principles in a manner that is appropriate to the Company’s circumstances.
The Company’s corporate governance statement is available on the Company’s website at www.ecograf.com.au.
Remuneration Report (Audited)
1.
INTRODUCTION
The following sections provide details of the remuneration paid to key management personnel by the Company and its controlled
entities for the year ended 30 June 2023. It forms part of the directors’ report and has been audited in accordance with section 308C
of the Corporations Act 2001.
Key management personnel are those persons who, directly or indirectly, have authority and responsibility for planning, directing and
controlling the major activities of the consolidated entity and include:
• non-executive directors, and
• executive directors and senior executives (collectively “executives”).
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EXTRACT UPGRADE RECYCLE Directors’ Report
Key management personnel
Position
Tenure during the year
Non-executive directors
Robert Pett
John Conidi
Keith Jones
Executive directors
Andrew Spinks
Senior executives
Dale Harris
Howard Rae
Non-Executive Chair
Non-Executive Director
Non-Executive Director
Full financial year
Full financial year
23 May 2023-30 June 2023
Managing Director
Full financial year
Chief Operating Officer
4 July 2022-30 June 2023
Chief Financial Officer & Joint Company Secretary
Full financial year
2. REMUNERATION GOVERNANCE FRAMEWORK
The remuneration structure adopted by the Company has been designed to promote alignment between the objectives
and interests of shareholders, directors and executives. Accordingly, as the Company’s key assets have not yet reached the
operational phase, a greater emphasis is placed on rewarding performance through the award of equity in the Company
which preserves cash resources and is linked to the creation of shareholder value.
2.1 Remuneration principles
Key principles that guide decisions about key management personnel (KMP) remuneration are:
• Fairness: provide a fair level of reward to all employees
• Transparency: establish transparent links between reward outcomes and performance
• Alignment: promote mutually beneficial outcomes by aligning employee, customer and shareholder interests, and
• Culture: drive leadership performance and behaviours that promote safety, diversity and employee engagement.
2.2 Remuneration governance
At its Annual General Meeting on 29 November 2022 the Company received a first strike vote of 25.76% against the
adoption of its 2022 remuneration report. Feedback received from shareholders was that the objection to the resolution
was not specifically related to the remuneration arrangements, but instead investor concern over the decline in the
Company’s share price following deferral of the proposed Australian battery anode material facility development, which
occurred due to the release in mid-2022 of legislation in the US and Europe on new critical minerals supply chains.
In response to the first strike, the Company has sought to increase its shareholder communications through more regular
and detailed ASX updates, periodic reports, presentations and shareholder information sessions. It has also reviewed
the composition of the Board and appointed an additional independent non-executive director, Mr Keith Jones, a highly
regarded Australian public company director and chairperson, with significant expertise in finance, corporate governance
and project development.
Mr Jones was appointed a director on 23 May 2023 and the Company has subsequently established a separate
Nomination and Remuneration Committee comprised only of its three non-executive directors, with Mr Jones as its
chairperson. The Nomination and Remuneration Committee operates under a designated Charter, a copy of which is
contained in the Corporate Governance Plan available on the Company’s website.
The Company has also undertaken a process with external consultants to review its remuneration arrangements for the
year ending 30 June 2024 to ensure they remain effective and appropriate for the nature of its business activities and
align with the interests of shareholders and current market practices. Further details will be set out in the Notice of Annual
General Meeting.
32
ANNUAL REPORT 2023ECOGRAF LIMITED 2.3 Use of remuneration consultants
From time to time the directors may seek independent external advice on the appropriateness of the remuneration
arrangements for key management personnel. During the year ended 30 June 2023, the Board engaged The Reward
Practice Pty Ltd to undertake a review of executive incentive arrangements. No remuneration recommendations, as defined
by the Corporations Act, were provided by the consultant.
3. EXECUTIVE KMP REMUNERATION ARRANGEMENTS
A combination of fixed and variable reward is provided to executives, based on their responsibility within the Company
in relation to the achievement of its strategic objectives and capacity to contribute to the generation of long-term
shareholder value.
The components of executive KMP remuneration consist of fixed remuneration and variable equity-based short and long-
term incentive arrangements. The following table presents a summary of remuneration components for executive KMP for
the year ended 30 June 2023.
Fixed remuneration
Equity-based, variable / at risk remuneration
Purpose
How the
remuneration is
delivered and
assessed?
Provide fair remuneration
to recognise executive
responsibilities and
impact on the business.
Cash
Remuneration level is
reviewed annually by
the Board and may be
adjusted based on the
practices adopted by
similar companies and
changes in responsibilities
and scope.
Assist the attraction, retention and incentivisation of executives in a cash
efficient manner, and
Enable the Company to develop its graphite businesses and grow
long-term shareholders value.
STI
(100% performance rights)
LTI
(100% performance rights)
Awarded annually based on
performance against KPIs.
See 3.1 for further details.
Performance rights may be granted
to executives which will vest based
on achievement of the Company’s
long-term objectives.
3.1 Equity-based incentive arrangements
On 25 November 2020 shareholders approved the adoption of the Company's Incentive Performance Rights Plan, which is
designed to assist with the recruitment, reward, retention and incentivisation of key personnel who possess the skills and
experience to enable the Company to develop its graphite businesses and grow long-term shareholder value.
The Company is at a critical stage in its growth as it advances its key natural flake graphite and battery anode material
projects to development and operations. The international graphite industry is also evolving rapidly to support the demand
for lithium-ion batteries in electric vehicles and the retention of specialised skills is essential to the Company's future success.
To achieve this outcome, the Company believes that rewarding performance through equity arrangements is the most
effective incentive structure because it preserves the Company's cash reserves and aligns the interests of KMP with those of
shareholders. The equity-based structure includes STI and LTI components.
Short-term incentive (STI)
Under the STI plan, eligible participants can earn performance rights for the achievement of key performance outcomes
each year. The amount, if any, of short-term incentive awarded is determined after the end of each year, by assessing the
individual’s performance against the applicable key measures and then applying the resulting percentage score to the short-
term incentive remuneration opportunity.
For example, an individual with a fixed annual remuneration of $350,000, a short-term incentive opportunity of 40% and an
annual performance score of 75% will be entitled to an STI award of $105,000 = $350,000 X 40% x 75%.
The STI award is settled through the grant of performance rights, with the number determined by dividing the award amount
by the volume weighted average price of the Company’s shares during the applicable financial year. Upon exercise, each
performance right will entitle the eligible participant to receive one ordinary share in the Company.
33
EXTRACT UPGRADE RECYCLE Directors’ Report
The grant of performance rights for the STI award, if any, occurs after the end of the financial year and the Board measures
the short-term performance of executive KMP through the achievement of outcomes across four key areas as outlined in the
following table:
KPI category and weighting
Business development
30%
Financial management
20%
Organisational development
20%
Innovation and continuous
improvement
30%
KPI areas of assessment
Effective advancement of the Company’s graphite businesses towards
construction and operations, including completion of studies, early works
programs, entering into contractual arrangements with constructors,
operators, suppliers and customers, securing support from financiers and
obtaining positive Government cooperation.
Delivery against annual financial budgets, including effective cost control
whilst achieving business objectives, accessing working capital on a timely
and cost-effective basis and protecting the Company from financial loss.
Building organisational capacity and resilience, through effective human
resource management, establishing appropriate operating structures to
support planned expansion, developing a positive corporate reputation with
stakeholders and overcoming adverse external impacts on the business.
Driving on-going progress in process and product development, leveraging
partnerships with Government and commercial organisations to explore new
technologies and markets that will add value and identifying opportunities to
continuously enhance and grow the business.
For the year ended 30 June 2023, the STI opportunity for executive KMP was 40% of their fixed remuneration and was set by
reference to the practices adopted by similar companies.
Long-term incentive (LTI)
The LTI incentive arrangements involve the offer of performance rights to eligible participants which are subject to pre-
determined performance conditions that are required to be achieved prior to vesting. The performance conditions are set to
promote achievement of the Company’s key strategic objectives over the long term, with a target rolling performance period
of 3-5 years. The LTI opportunity for executive KMP is currently 100% of their fixed remuneration and is set by reference to the
practices adopted by similar companies.
As the Company’s battery minerals mining, processing and recycling businesses are in the development phase, the Board
considers it appropriate to measure the long-term performance of KMPs across a combination of key project milestones and
growth of shareholder value.
4. EXECUTIVE REMUNERATION OUTCOMES
4.1 Financial performance
The table below sets out information about the Company’s results and movements in shareholder value for the past five
years up to and including the current financial year. The historic numbers have not been assessed and adjusted for the
impact of the new accounting standards.
Net loss after tax ($’000)
Share price at end of year ($)
Basic loss per share (cents)
30 June
2023
30 June
2022
30 June
2021
30 June
2020
(7,299)
0.14
(1.62)
(7,505)
0.25
(1.67)
(5,514)
0.57
(1.40)
(2,769)
0.07
(0.91)
30 June
2019
(3,340)
0.12
(1.19)
34
ANNUAL REPORT 2023ECOGRAF LIMITED 4.2 Fixed remuneration outcomes
Following the review of executive KMP remuneration levels against relevant market conditions and scope of roles, the
following table outlines fixed remuneration changes (inclusive of superannuation) for executive KMP during the financial year.
Andrew Spinks
Dale Harris
Howard Rae
Fixed remuneration
30 June 2023
Fixed remuneration
30 June 2022
$355,875
$450,000
$400,000
$355,875
-
$400,000
4.3 Equity-based variable/at risk remuneration outcomes
A total of 326,868 performance rights were issued to executive KMP during the financial year in relation to STI awards for the
performance period to 30 June 2022 as set out below:
Executives
Position
Andrew Spinks
Managing Director
Howard Rae
Chief Financial Officer
Maximum STI
% of Fixed
Remuneration
(FR)
40% of FR
40% of FR
Performance
score
STI award
value
Number of
performance rights
75%
72%
$106,762
$105,669
164,275
162,593
Terms of these performance rights are set out below:
Grant date
Expiry date
21 February 2023
21 February 2028
Fair value per
Performance Right
at grant date
$0.22
A total of 3,702,557 performance rights were issued to executive KMP under LTI arrangements during the year ended 30
June 2023, the terms and conditions of which are set-out below:
Grant date
Expiry date
Vesting milestones
Fair value per
Performance Right
at grant date
Executives, including Managing Director
21 February 2023
21 February 2028
30% of Performance Rights vest upon achieving the
20-day VWAP of the Company’s Shares being equal to or
greater than $0.60.
30% of Performance Rights vest upon achieving the
20-day VWAP of the Company’s Shares being equal to or
greater than $0.80.
20% of the Performance Rights vest upon commissioning
of the Company’s battery anode material product
qualification facility.
20% of the Performance Rights vest upon the
commencement of construction of the Company’s:
(a) Epanko Graphite Project; or
(b) commercial scale Battery Anode Material Facility
$0.19
$0.18
$0.22
$0.22
Section 8.2 contains further details of the performance rights granted to KMP during the year. The fair value of the
performance rights at grant date is independently determined using an option pricing model.
35
EXTRACT UPGRADE RECYCLE Directors’ Report
5. EXECUTIVE KMP EMPLOYMENT AGREEMENTS
The remuneration and other conditions of employment of executives are formalised in employment contracts that specify
duties and obligations to be fulfilled and provide for an annual review of remuneration. Executive KMP termination notice
periods and payment provisions are as follows:
Andrew Spinks
Dale Harris
Howard Rae
Resignation
6 months
3 months
3 months
Termination
for cause
Termination in case of death, disablement,
redundancy or notice without cause
Termination
payment
None
None
1 month
1 month
3 months
3 months
3 months
3 months
3 months
6. NON-EXECUTIVE DIRECTOR REMUNERATION
6.1 Fees
Non-executive director fees are set to attract and retain persons with the experience and skills necessary to oversee the
Company’s business activities and to guide its growth and development into a successful mining and mineral processing
company.
The current fee is $110,000 per annum (inclusive of superannuation) for the role of Chairperson and $90,000 per annum
(inclusive of superannuation) for other non-executive directors. Non-executive directors may be paid additional amounts for
special duties or exertions (consultancy services outside of director’s duties) and are entitled to be reimbursed for reasonable
out-of-pocket expenses incurred in the course of their duties.
6.2 Maximum aggregate amount
Total fees payable to all non-executive directors, excluding amounts for special exertion or the reimbursement of reasonable
business expenditures, must not exceed $300,000 per annum, in accordance with the approval provided by shareholders in
2010.
6.3 Equity grants to non-executive directors
From time to time, the Board may approve the grant of equity to non-executive directors. Considering the higher risk
associated with the pre-production stage of the Company’s activities and the need to attract and retain specialist director
skills and experience to guide it through project implementation and into successful operations, 1,000,000 performance
rights were issued to non-executive directors during the year ended 30 June 2023 (2022: Nil).
The terms and conditions of each grant of Performance Rights granted during the reporting period are set out below:
Grant date
Expiry date
Vesting conditions
Non-executive directors
Value per
Performance
Right at grant date
29 November 2022 1 29 December 2027 30% of Performance Rights vest upon achieving the
$0.27
20-day VWAP of the Company’s Shares being equal to
or greater than $0.60.
30% of Performance Rights vest upon achieving the
20-day VWAP of the Company’s Shares being equal to
or greater than $0.80.
40% of Performance Rights vest upon achieving the
20-day VWAP of the Company’s Shares being equal to
or greater than $1.00.
$0.26
$0.25
1 Date of shareholders' approval.
Section 8.2 contains further details of the performance rights granted to KMP during the year. The fair value of the
performance rights at grant date is independently determined using an option pricing model.
36
ANNUAL REPORT 2023ECOGRAF LIMITED 7. STATUTORY REMUNERATION DISCLOSURES
Details of the remuneration of the key management personnel of the consolidated entity are set out in the following table.
Short-term
benefits
Post-
employ-
ment
Long-term
benefits
Share-based
payments1
Fees for
special
duties or
exertion
$
Salary/
Fees
$
Super-
annuation
$
Long
Service
Leave
expense
$
STI
$
LTI
$
Total
$
% linked
to
perfor-
mance
Non-executive directors
Robert Pett
John Conidi
Keith Jones
Executives
Andrew Spinks
Dale Harris
Howard Rae
2023
2022
2023
2022
2023
2022
99,322
99,917
80,000
80,000
8,465
-
2023
341,473
2022
329,092
2023
2022
417,107
-
2023
377,956
2022
359,825
Total
remuneration
2023 1,324,323
2022 868,834
-
-
-
-
-
-
-
-
-
-
-
-
-
-
10,678
10,083
-
-
931
-
27,500
27,500
25,192
-
27,000
27,000
91,301
64,583
-
-
-
-
-
-
-
-
-
-
-
-
12,963
122,963
-
110,000
12,963
92,963
-
-
-
80,000
9,396
-
2,747
6,488
617
-
4,078
2,823
7,442
36,141
150,314
558,175
213,349
-
576,429
-
-
53,883
496,799
-
-
35,770
160,689
605,493
213,349
-
602,997
71,911
390,812 1,885,789
9,311
426,698
- 1,369,426
11%
0%
14%
0%
0%
0%
33%
37%
11%
0%
32%
35%
25%
31%
1
Includes the non-cash value of performance right and loan share equity remuneration arrangements during the financial year under AASB Share-based
payments.
8. ADDITIONAL DISCLOSURES RELATING TO SHARES AND PERFORMANCE RIGHTS
Balance at
1 July 2022
Balance at date
of appointment
Movement
during the year
Balance at
30 June 2023
3,454,615 1
3,019,402 2
-
11,998,822 3
-
3,150,000 4
21,622,839
-
-
-
-
-
-
-
-
-
85,000 5
-
-
-
85,000
3,454,615
3,019,402
85,000
11,998,822 3
-
3,150,000 4
21,707,839
37
Includes 2,000,000 shares issued under the former non-executive director share plan
1
2 Includes 1,000,000 shares issued under the former non-executive director share plan
3 Includes 2,000,000 shares issued under the former employee share plan
4 Includes 3,000,000 shares issued under the former employee share plan
5 Movement represents purchase of shares
8.1 Number of shares
Non-executives
Robert Pett
John Conidi
Keith Jones
Executives
Andrew Spinks
Dale Harris
Howard Rae
Total
EXTRACT UPGRADE RECYCLE Directors’ Report
8.2 Number of incentive performance rights
Balance at 30 June 2022
Granted during the year
Balance at 30 June 2023
STI
LTI
STI
LTI
STI
LTI
Non-executives
Robert Pett
John Conidi
Keith Jones
Executives
-
-
-
1,250,000
1,250,000
-
-
-
-
Andrew Spinks
320,825
1,775,000
164,2751
-
-
-
320,825
1,775,000
162,5931
Dale Harris
Howard Rae
Total
500,000
500,000
-
963,908
1,744,862
993,787
-
-
-
1,750,000
1,750,000
-
485,100
2,738,908
-
483,418
1,744,862
2,768,787
641,650
6,050,000
326,868
4,702,557
968,518
10,752,557
1 Short-term incentive for the year ended 30 June 2022, which was granted on 21 February 2023
There were no performance rights held by key management personnel which were exercised, forfeited or cancelled during
the year ended 30 June 2023.
8.3 Loans to key management personnel
There were no loans granted to key management personnel during the year ended 30 June 2023 (2022: Nil).
8.4 Other transactions with key management personnel
There were no other transactions with key management personnel of the consolidated entity, including their personally
related parties during the year ended 30 June 2023 (2022: Nil).
END OF REMUNERATION REPORT
Shares under Performance Rights
Unissued ordinary shares in the Company under performance rights, with no exercise price, at the date of this report are
as follows:
Expiry date
19 January 2026
7 December 2027
7 December 2026
29 December 2027
21 February 2028
21 February 2028
Number of Performance Rights
5,675,000
320,825
500,000
1,000,000
164,275
3,952,557
11,612,657
Date of grant
20 January 2021
8 December 2021
8 December 2021
29 November 20221
21 February 2023
21 February 2023
Total
1 Date of shareholders' approval.
38
ANNUAL REPORT 2023ECOGRAF LIMITED Shares Issued on the Vesting of Performance Rights
During the financial year and up to the date of the report, the following ordinary shares of the Company were issued on
exercise of Performance Rights granted by the Company:
Date of grant
8 December 2021
20 January 2021
21 February 2023
Total
Shares Under Options
Number of Performance Rights exercised
320,825
1,775,000
162,593
2,258,418
There are no unissued ordinary shares in the Company under options at the date of this report.
Signed in accordance with a resolution of the directors made pursuant to s298 (2) of Corporations Act 2001.
Andrew Spinks
Managing Director
Perth, 29 September 2023
39
39
EXTRACT UPGRADE RECYCLE Auditor’s Independence Declaration
40
ANNUAL REPORT 2023ECOGRAF LIMITED AUDITOR’S INDEPENDENCE DECLARATION As lead auditor for the audit of the financial report of EcoGraf Limited for year ended 30 June 2023, I declare that, to the best of my knowledge and belief, there have been no contraventions of: (i) the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and (ii) any applicable code of professional conduct in relation to the audit. RSM AUSTRALIA PARTNERS Perth, WA TUTU PHONG Dated: 29 September 2023 Partner FINANCIAL
STATEMENTS
Consolidated Statement of Profit or Loss and Other Comprehensive Income
42
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
43
44
45
46
E
L
C
Y
C
E
R
E
D
A
R
G
P
U
T
C
A
R
T
X
E
41
Consolidated Statement of Profit or Loss
and Other Comprehensive Income
For the Year Ended 30 June 2023
Revenue
Interest income
Other income
Expenses
Accounting and audit
Consultants and contractors
Employee benefits
Depreciation
Directors fees
Exploration and evaluation expensed
Information systems and technology
Listing and compliance
Office rental and outgoings
Other
Share-based payments expense
Travel and accommodation
Foreign exchange differences
Loss before income tax
Income tax expense
Loss after income tax for the year
Other comprehensive income, net of income tax
Items that may be reclassified subsequently to profit or loss
Exchange differences arising on translation of foreign operations
Other comprehensive income for the year
Total comprehensive loss for the year, net of income tax
Total comprehensive loss attributable to the ordinary equity holders of the
Company
Note
2023
$’000
2022
$’000
3
4
9
19
1,289
1,039
2,328
(218)
(4,493)
(2,374)
(17)
(199)
(561)
(57)
(245)
(201)
(394)
(625)
(231)
(12)
191
504
695
(153)
(4,669)
(1,618)
(11)
(190)
(309)
(27)
(204)
(159)
(324)
(483)
(57)
4
(9,627)
(8,200)
(7,299)
(7,505)
5
-
-
(7,299)
(7,505)
1,698
1,698
(5,601)
(5,601)
-
-
(7,505)
(7,505)
Loss per share attributable to the ordinary equity holders of the Company
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
16
16
(1.62)
(1.62)
(1.67)
(1.67)
The above statement should be read in conjunction with the accompanying notes.
42
ANNUAL REPORT 2023ECOGRAF LIMITED Consolidated Statement of
Financial Position
As at 30 June 2023
Assets
Current assets
Cash and cash equivalents
Other financial assets - term deposits at bank
Other receivables
Prepayments
Total current assets
Non-current assets
Exploration and evaluation assets
Property, plant and equipment
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Deferred revenue
Employee provisions
Total current liabilities
Non-current liabilities
Other payables
Employee provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
Note
2023
$’000
2022
$’000
6
6
7
8
9
10
11
10
12
13
38,606
-
137
320
6,728
40,000
258
295
39,063
47,281
22,975
53
23,028
18,403
47
18,450
62,091
65,731
1,603
1,044
244
2,891
263
41
304
2,126
-
155
2,281
-
32
32
3,195
2,313
58,896
63,418
99,834
11,203
(52,141)
99,834
8,426
(44,842)
58,896
63,418
The above statement should be read in conjunction with the accompanying notes.
E
L
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43
EXTRACT UPGRADE RECYCLE
Consolidated Statement of
Changes in Equity
For the Year Ended 30 June 2023
Contributed
equity
$’000
Accumulated
losses
$’000
Foreign
currency
translation
reserve
$’000
Loan
share
reserve
$’000
Share-
based
payments
reserve
$’000
Total
$’000
Balance at 30 June 2021
99,837
(37,337)
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
Transactions with owners in their
capacity as owners
Share plan shares cancelled/ released
Share-based payments expense
Share issue cost
-
-
-
-
-
(3)
(7,505)
-
(7,505)
-
-
-
Balance at 30 June 2022
99,834
(44,842)
(1,512)
9,342
70,330
-
-
-
113
-
-
-
-
-
-
483
-
(7,505)
-
(7,505)
113
483
(3)
(1,399)
9,825
63,418
-
-
-
-
-
-
-
-
-
1,698
1,698
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
Transactions with owners in their
capacity as owners
Share plan shares cancelled/ released
Share based payment expense
-
-
-
-
-
(7,299)
-
(7,299)
-
-
-
-
-
-
-
454
-
-
-
-
-
625
(7,299)
1,698
(5,601)
454
625
Balance at 30 June 2023
99,834
(52,141)
1,698
(945)
10,450
58,896
The above statement should be read in conjunction with the accompanying notes.
44
ANNUAL REPORT 2023ECOGRAF LIMITED Consolidated Statement of
Cash Flows
For the Year Ended 30 June 2023
Operating Activities
Research and development tax credit received
Government grant
Payments to suppliers and employees
Net cash flows used in operating activities
Investing Activities
Payments for exploration and evaluation
Interest received
Purchase of property, plant and equipment
Proceeds from maturity of term deposits
Net cash flows from investing activities
Financing Activities
Capital raising costs for issue of shares
Repayment of share plan loans
Net cash flows from financing activities
Net increase in cash and cash equivalents held
Cash and cash equivalents at beginning of the year
Foreign exchange movement on cash and cash equivalents
Cash and cash equivalents at end of the year
Add: Other financial assets - term deposits at bank
Cash and cash equivalents and other financial assets - term deposits at end
of the year
The above statement should be read in conjunction with the accompanying notes.
Note
2023
$’000
1,039
1,149
(9,912)
(7,724)
(2,100)
1,289
(17)
40,000
39,172
-
454
454
31,902
6,728
(24)
38,606
-
38,606
14
6
6
2022
$’000
504
-
(6,492)
(5,988)
(165)
138
-
10,000
9,973
(3)
113
110
4,095
2,633
-
6,728
40,000
46,728
E
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4545
EXTRACT UPGRADE RECYCLE
1. Company Information
The consolidated financial statements of EcoGraf Limited and its subsidiaries (collectively, “the consolidated entity” or "the
Group") for the year ended 30 June 2023 were authorised for issue in accordance with a resolution of the directors on
29 September 2023.
EcoGraf Limited (“the Company” or “the parent”) is a for profit company limited by shares incorporated in Australia whose
shares are publicly traded on the Australian Securities Exchange. It has activities in Australia and Tanzania, with the country of
domicile being Australia and the registered office located in Australia.
The nature of the operations and principal activities of the consolidated entity are described in the directors’ report.
Information on the consolidated entity’s structure is provided in note 23 and details of other related party relationships is
provided in note 21.
2. Basis of Preparation
The financial report is a general purpose financial report, which has been prepared in accordance with the requirements
of the Corporations Act 2001, Australian Accounting Standards, and other authoritative pronouncements of the Australian
Accounting Standards Board.
The financial report has been prepared on a historical cost basis.
The financial report also complies with International Financial Reporting Standards (IFRS) as issued by the International
Accounting Standards Board.
These consolidated financial statements are presented in Australian dollars. All amounts have been rounded to the
nearest thousand, unless otherwise stated in accordance with ASIC Corporations (Rounding In Financial/Directors’ Reports)
Instrument 2016/191.
3. Other Income
Research and development tax credit
4. Consultants and Contractors
Downstream processing research, development and engineering
Legal
Investor relations
Other
2023
$’000
1,039
1,039
2023
$’000
2,823
789
379
502
2022
$’000
504
504
2022
$’000
3,090
582
278
719
4,493
4,669
46
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 5. Income Tax
a)
Reconciliation between Tax Expense and Loss before Income Tax
Loss before Income Tax
2023
$’000
2022
$’000
(7,299)
(7,505)
At Australia’s statutory income tax rate of 30% (2022: 30%)
(2,190)
(2,252)
Amounts not deductible/ (assessed) for income tax
Over-provision of prior year current income tax
Deferred tax asset not recognised
Income tax expense
b) Deferred Income Tax
Deferred income tax at balance date relates to the following:
Deferred tax asset
Tax losses available to offset against future taxable income
Blackhole expenditure available for future deduction
Other temporary differences
Deferred tax liabilities
Exploration and evaluation assets
Deferred tax recognised in equity
Foreign exchange translation differences recognised in equity
Net deferred tax
Deferred tax asset not recognised
505
699
986
-
15,237
665
75
15,977
(5,944)
(5,944)
187
187
10,220
(10,220)
-
(6)
-
2,258
-
12,713
715
-
13,428
(5,521)
(5,521)
-
-
7,907
(7,907)
-
The benefit of deferred tax assets not brought to account will only be recognised if:
• Future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised;
• The conditions for deductibility imposed by tax legislation continue to be complied with; and
• No changes in tax legislation adversely affect the consolidated entity in realising the benefit.
c) Tax losses
At the reporting date, the Group has unrecognised tax losses of $50,789,000 (2022: $42,376,000) that are available for
offset against future taxable profits. Tax losses in Australia and Tanzania do not expire.
47
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 6. Cash and Cash Equivalents and Other Financial Assets
Cash at bank and on hand
Other financial assets - term deposits at bank
7. Other Receivables
Goods and services tax receivable
Other receivables
Interest on term deposit
Security deposits
8. Exploration and Evaluation Assets
Opening balance at the beginning of the year
Capitalised expenditure at cost
Foreign exchange movement on exploration and evaluation asset
Balance at 30 June
Judgements and estimates
2023
$’000
38,606
38,606
-
-
2023
$’000
26
70
-
41
137
2023
$’000
18,403
2,898
1,674
22,975
2022
$’000
6,728
6,728
40,000
40,000
2022
$’000
162
-
55
41
258
2022
$’000
18,238
165
-
18,403
Recoverability of the carrying amount of exploration and evaluation assets is dependent on the successful development and
commercial exploitation of areas of interest and the sale of minerals, or the sale of the respective areas of interest.
Epanko project
All expenditures related to this project are capitalized, as these expenditures are expected to be recovered through
successful development of the project, particularly in light of the recent signing of the Framework and Shareholder
Agreement with the Government of Tanzania to develop the project.
All other projects
All exploration and evaluation expenditures associated with other projects have been expensed in the period in which they
are incurred.
48
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 9. Property, Plant and Equipment
Plant &
equipment
$’000
Motor
Vehicles
$’000
Office
equipment
and furniture
$’000
At cost
Accumulated depreciation
Net carrying amount at 30 June 2023
Movement in the carrying amounts
Balance at 30 June 2021
Additions
Disposals
Depreciation expense
Balance at 30 June 2022
Additions
Disposals
Depreciation expense
Foreign exchange movement on property, plant
and equipment
Balance at 30 June 2023
10. Trade and Other Payables
Current
Trade payables
Accrued expenses
Other payables
Non-current
Other payables
11. Deferred revenue
Government grant received in advance
18
(16)
2
4
-
(1)
(1)
2
-
-
(1)
1
2
79
(60)
19
23
-
(1)
(5)
17
-
-
(4)
6
19
84
(52)
32
28
9
(4)
(5)
28
20
(3)
(12)
(1)
32
2023
$’000
1,369
184
50
1,603
263
2023
$’000
1,044
Total
$’000
181
(128)
53
55
9
(6)
(11)
47
20
(3)
(17)
6
53
2022
$’000
1,947
179
-
2,126
-
2022
$’000
-
49
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 12. Contributed Equity
450,333,459 (2022: 450,333,459) fully paid ordinary shares
a) Ordinary shares
Balance at 30 June 2021
Incentive performance rights plan shares issued – September 2021
Incentive performance rights plan shares issued – November 2021
Capital raising costs
Balance at 30 June 2022
Balance at 30 June 2023
Fully paid ordinary shares carry one vote per share and carry a right to dividends.
13. Reserves
Share-based payments reserve
Loan plan share reserve
Foreign currency translation reserve
Movement in share-based payment reserve
Balance at beginning of year
Share-based payments expense
Balance at end of year
Movement in loan plan share reserve
Balance at beginning of year
Plan shares expired/ released
Balance at end of year
Movement in foreign currency translation reserve
Balance at beginning of year
Foreign currency translation differences
Balance at end of year
2023
$’000
99,834
2022
$’000
99,834
$’000
No. of shares
99,837
449,833,459
-
-
(3)
100,000
400,000
-
99,834
99,834
450,333,459
450,333,459
2023
$’000
10,450
(945)
1,698
11,203
9,825
625
10,450
(1,399)
454
(945)
-
1,698
1,698
2022
$’000
9,825
(1,399)
-
8,426
9,342
483
9,825
(1,512)
113
(1,399)
-
-
-
Share-based payments reserve
The reserve recognises the value of equity provided as remuneration to employees and also to other parties as
compensation for services provided to the consolidated entity.
Loan plan share reserve
The reserve represents the non-cash nominal value of loan shares on issue to employees and is deducted from equity.
Foreign currency translation reserve
The foreign currency translation reserve arises on the consolidation of the Group’s overseas subsidiaries in Tanzania.
50
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 14. Cash Flow Information
Reconciliation of cash flow from operations with loss for the year
Loss for the year
Adjustments for:
Interest income
Depreciation
Loss on disposal of fixed asset
Share based payment expense
Changes in assets and liabilities:
(Increase)/ decrease in Other receivables and prepayments
(Decrease)/ increase in Trade and other payables
Increase / (decrease) in Employee provisions and payables
Revenue received in advance
Net cash flows used in operating activities
2023
$’000
2022
$’000
(7,299)
(7,505)
(1,289)
17
-
625
104
(978)
52
1,044
(7,724)
(191)
11
(3)
483
218
1,015
(16)
-
(5,988)
15. Expenditure Commitments, Contingent Assets/ Contingent Liabilities
Mineral tenements
In order to maintain current rights of tenure to exploration tenements, the consolidated entity is required to outlay rentals and
to satisfy minimum expenditure requirements of $2,581,934 (2022: $1,797,559) over the next 12 months, in accordance with
agreed work programs submitted over the Company’s exploration licences. Financial commitments for subsequent periods
are contingent upon future exploration results.
There are no contingent assets or liabilities at 30 June 2023 or 30 June 2022.
16. Loss Per Share
Data used in the basic loss per share computations:
Loss for the year (A$’000)
Weighted average number of ordinary shares
Basic and diluted loss per share (cents)
2023
2022
(7,299)
(7,505)
450,333,459
450,164,144
(1.62)
(1.67)
Loss per share is calculated by dividing the loss for the year attributable to ordinary equity holders of the Company by the
weighted average number of ordinary shares outstanding during the year.
51
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 17. Auditor’s Remuneration
Audit and review of the financial reports:
- Group
- Controlled entities
Fees for assurance services that are required by legislation to be provided
by the auditor
2023
$
46,280
15,000
61,280
28,825
2022
$
53,500
-
53,500
2,000
Total fees to RSM Australia Partners
90,105
55,500
18. Segment information
Information reported to the chief operating decision maker (CODM) for the purpose of resource allocation and assessment of
segment performance focuses on the geographical location of the Group's principle activities, which are located in Tanzania
and Australia.
Australia
$’000
Tanzania
$’000
Consolidated
$’000
2,328
(210)
(4,163)
(2,374)
(11)
(199)
-
(57)
(245)
(187)
(377)
(625)
(226)
(19)
-
2,328
(8)
(330)
-
(6)
-
(561)
-
-
(14)
(17)
-
(5)
7
(218)
(4,493)
(2,374)
(17)
(199)
(561)
(57)
(245)
(201)
(394)
(625)
(231)
(12)
(6,365)
(934)
(7,299)
2023 Results
Segment income
Segment expenses
Accounting and audit
Consultants and contractors
Employee benefits
Depreciation
Directors fees
Exploration and evaluation expensed
Information systems and technology
Listing and compliance
Office rental and outgoings
Other
Share-based payments
Travel and accommodation
Foreign exchange (loss)/ gain
Segment results
52
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 2022 Results
Segment income
Segment expenses
Accounting and audit
Consultants and contractors
Employee benefits
Depreciation
Directors’ fees
Exploration and evaluation expensed
Information systems and technology
Listing and compliance
Office rental and outgoings
Other
Share-based payments
Travel and accommodation
Foreign exchange gain/(loss)
Segment results
2023 Assets
Property, plant and equipment
Exploration and evaluation assets
Segment non-current assets
Unallocated assets:
Cash and cash equivalents
Other receivables
Prepayments
Total assets
2023 Liabilities
Segment liabilities
Total liabilities
Australia
$’000
Tanzania
$’000
Consolidated
$’000
695
-
695
(147)
(4,533)
(1,618)
(4)
(190)
-
(25)
(204)
(157)
(252)
(483)
(56)
(17)
(6)
(136)
-
(7)
-
(309)
(2)
-
(2)
(72)
-
(1)
21
(153)
(4,669)
(1,618)
(11)
(190)
(309)
(27)
(204)
(159)
(324)
(483)
(57)
4
(6,991)
(514)
(7,505)
Australia
$’000
Tanzania
$’000
Consolidated
$’000
24
-
24
29
22,975
23,004
(2,430)
(765)
53
22,975
23,028
38,606
137
320
62,091
(3,195)
(3,195)
53
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023
2022 Assets
Property, plant and equipment
Exploration and evaluation assets
Segment non-current assets
Unallocated assets:
Cash and cash equivalents
Other financial assets - term deposits at bank
Other receivables
Prepayments
Total assets
2022 Liabilities
Segment liabilities
Total liabilities
Australia
$’000
Tanzania
$’000
Consolidated
$’000
21
-
21
26
18,403
18,429
(2,281)
(32)
47
18,403
18,450
6,728
40,000
258
295
65,731
(2,313)
(2,313)
19. Share-based payments
Share-based payment expense recorded by the Group during the year was $624,686 (2022: $482,691).
Incentive Performance Rights Plan
The shareholder approved Incentive Performance Rights Plan is designed to assist with the recruitment, reward, retention
and incentivisation of key personnel who possess the skills and experience to enable the Company to develop its graphite
businesses and grow long-term shareholders value.
To achieve this outcome, the Company believes that incentivising and rewarding performance and the achievement of key
objectives through equity arrangements is the most effective remuneration structure because it preserves the Company’s
cash reserves and aligns the interests of personnel with those of all shareholders.
Short-Term Incentive
Under the short-term incentive arrangements, eligible participants may earn performance rights for the achievement of
pre-determined key performance measures each year. The amount, if any, is made after the end of each year, and
determined by multiplying the individual’s assessed key performance score by the applicable percentage of their fixed annual
remuneration. The number of performance rights, if any, to be earned under the short-term incentive is calculated by dividing
the short-term incentive amount by the volume weighted average price of the Company’s shares during the applicable
financial year.
Long-Term Incentive
The long-term incentive arrangements involve the offer of performance rights to eligible participants which are subject to
pre-determined performance conditions that should be achieved prior to vesting. The performance conditions are set to
promote achievement of the Company’s key strategic objectives. Subject to the achievement of the specified performance
conditions, upon exercise each performance right will entitle the eligible participant to receive one ordinary share in the
Company. The number of performance rights offered to an individual is determined by reference to equity incentives offered
by similar companies and the potential for the individual, through their position, skills and experience, to create long-term
shareholder value.
54
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 -
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Set out below are the number and movement of performance rights granted under the plan:
Granted
Exercised
2023
Grant date
Expiry date
20 Jan 2021
19 Jan 2026
8 Dec 2021
8 Dec 2021
07 Dec 2027
07 Dec 2026
29 Nov 20221
29 Dec 2027
21 Feb 2023
21 Feb 2028
21 Feb 2023
21 Feb 2028
Exercise
price
Nil
Nil
Nil
Nil
Nil
Nil
Balance at
the start of
the year
7,450,000
641,650
1,000,000
-
-
-
1,000,000
326,868
3,952,557
9,091,650
5,279,425
Weighted average remaining contractual life of
outstanding performance rights
3.9 years
Expired/
forfeited/
other
Balance at
the end of
the year
-
-
7,450,000
641,650
(500,000)
500,000
-
-
-
1,000,000
326,868
3,952,557
(500,000)
13,871,075
3.5 years
Weighted average exercise price
$nil
$nil
$nil
$nil
$nil
1 Date of shareholders' approval.
2022
Grant date
Expiry date
20 Jan 2021
19 Jan 2026
08 Dec 2021
07 Dec 2027
8 Dec 2021
07 Dec 2026
Exercise
price
Nil
Nil
Nil
Granted
Exercised
Balance at
the start of
the year
7,950,000
-
-
641,650
1,000,000
7,950,000
1,641,650
Expired/
forfeited/
other
Balance at
the end of
the year
(500,000)
7,450,000
-
-
641,650
1,000,000
(500,000)
9,091,650
3.9 years
Weighted average remaining contractual life of
outstanding performance rights
4.6 years
Weighted average exercise price
$nil
$nil
$nil
$nil
$nil
The performance rights granted during the year included 326,868 performance rights issued under short-term incentive
arrangement to key management personnel, and 4,952,557 performance rights issued under long-term incentive
arrangements to key management personnel and employees.
Performance rights issued under short-term incentive arrangement were vested and exercisable immediately with $nil
exercise price and expire on 21 February 2028.
55
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 Vesting conditions attached to performance rights issued during the year are as follows:
Performance rights granted
Vesting Conditions
1,000,000 performance rights
granted on 29 Nov 20221
30% vests on achieving the 20-day VWAP of the Company’s Shares being equal to
or greater than A$0.60
30% vests on achieving the 20-day VWAP of the Company’s Shares being equal to
or greater than A$0.80
40% vests on achieving the 20-day VWAP of the Company’s Shares being equal to
or greater than A$1.00
3,952,557 performance rights
granted on 21 Feb 2023
30% vests on achieving 20-day VWAP of the Company’s Shares being equal to or
greater than $0.60
30% vests on achieving 20-day VWAP of the Company’s Shares being equal to or
greater than $0.80
20% vests on commissioning of the Company’s battery anode material product
qualification facility
20% vests on commencement of construction of the Company’s:
(a) Epanko Graphite Project; or
(b) commercial scale Battery Anode Material Facility
1 Date of shareholders' approval.
On 16 June 2023, vesting conditions attached to 500,000 performance rights granted on 8 December 2021 were modified
to align to the conditions associated with performance rights granted on 21 February 2023 and the Company's business
objectives.
As vesting conditions attached to the performance rights are market and non-market conditions, the fair value at grant
date has been independently determined using various pricing models such as trinomial and Black Scholes option pricing
models. These models take into account the exercise price, the term of the performance right, the share price at grant date,
expected price volatility of the underlying share and the risk-free rate for the term of the performance right. Model inputs for
performance rights granted during the year are as follows:
Grant date
Expiry date
Number of performance rights
Share price at grant date
Exercise price
Expected volatility
Dividend yield
Risk-free interest rate
1 Date of shareholders' approval.
29 Nov 20221
29 Dec 2027
1,000,000
$0.295
Nil
100%
Nil
3.35%
21 Feb 2023
21 Feb 2028
3,952,557
$0.220
Nil
100%
Nil
3.62%
500,000 performance rights granted to an employee on 8 December 2021 were cancelled due to an employee resignation
during the year.
No performance right vested during the financial year ended 30 June 2023.
56
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 Share Plans
Plan shares are issued to directors and employees in recognition of their performance with the Company and as incentive
remuneration under the respective director and employee share plans (together the “Share Plans”). The terms and conditions
of the Share Plans are identical, other than in respect of who is eligible to participate in each plan. Plan shares are issued at
the discretion of the Board.
Under the Share Plans, eligible directors and employees are offered plan shares in the Company at prices determined by the
Board, which has the discretion to impose conditions on the shares issued under the Share Plans and may also grant a loan,
in the form of a non-cash credit facility, to a participant for the purposes of subscribing for plan shares. Shares issued via loan
facility may not be granted at less than the volume weighted average price of the Company’s shares during the five trading
days up to and including the date of acceptance and are escrowed as security until the loan has been fully repaid, via cash
payment and/or the sale of the plan shares. If the loan is repaid by the sale of shares, any surplus on sale is remitted to the
participant and any shortfall is borne by the consolidated entity.
Set out below are the plan shares on issue and the weighted average exercise price (WAEP) at the end of the financial year:
Grant date
13 July 2017
22 Dec 2017
13 Jul 2017
22 Dec 2017
22 Dec 2017
Expiry date
22 Dec 2022
22 Dec 2022
12 Jul 2023
12 Jul 2023
22 Jun 2024
2023
2022
Number
WAEP
-
-
1,000,000
2,750,000
2,000,000
5,750,000
-
-
0.230
0.151
0.151
Number
1.000.000
7,750,000
WAEP
0.230
0.151
-
-
-
8,750,000
-
-
-
During the year, the repayment date of non-recourse loans relating to plan shares were extended in order to maximise the
likelihood of the Company receiving the benefit of the cash funds receivable upon repayment. These extensions have been
treated as a modification with a resulting share-based payment expense. Model inputs for the valuation of the modification
are as follows:
Modification date
13 Jul 2022
23 Nov 2022
23 Nov 2022
22 Dec 2022
22 Jun 2023
Extended term (years)
0.44
0.63
0.63
0.5
1
Number of loan shares
1,000,000
1,000,000
2,750,000
2,000,000
2,000,000
New expiry date
22 Dec 2022
12 Jul 2023
12 Jul 2023
22 Jun 2023
22 Jun 2024
Share price at grant date
Exercise price
Expected volatility
Dividend yield
Risk-free interest rate
Value prior to modification
($’000)
Value subsequent to
modification ($'000)
Impact of modification ($'000)
$0.250
$0.228
100%
Nil
2.565%
22
75
53
$0.320
$0.228
100%
Nil
3.17%
97
140
43
$0.320
$0.245
$0.151
100%
Nil
3.17%
467
514
47
$0.151
100%
Nil
3.23%
188
221
33
There were no plan shares issued during the year ended 30 June 2023 (2022: Nil).
$0.145
$0.151
100%
Nil
4.1%
-
87
87
57
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 20. Directors and Key Management Personnel Disclosures
a) Names and positions of key management personnel in office at any time during the financial year:
Robert Pett
John Conidi
Keith Jones
Andrew Spinks
Howard Rae
Dale Harris
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Managing Director
Chief Financial Officer and Joint Company Secretary
Chief Operating Officer
b) Key management personnel remuneration
Aggregate compensation of key management personnel of the consolidated entity:
Short term employee benefits
Post-employment benefits
Long term employee benefits
Share-based payments (non-cash)
2023
$
1,324,323
91,301
7,442
462,723
2022
$
868,834
64,583
9,311
426,698
1,885,789
1,369,426
Detailed information about the remuneration received by key management personnel is provided in the remuneration report
on pages 31 to 38.
21. Related Party Disclosures
Transactions between related parties are on normal commercial terms.
Ultimate parent
EcoGraf Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 23.
Key management personnel
Disclosures relating to key management personnel are set out in note 20 and the remuneration report in the directors’ report.
Transactions with related parties
There were no related party transactions during the year ended 30 June 2023 (2022: Nil)
22. Controlled Entities
All controlled entities are included in the consolidated financial statements. The parent entity does not guarantee to pay
the deficiency of its controlled entities in the event of a winding up of any controlled entity. The financial year end of the
controlled entities is the same as that of the parent entity.
During the year, the Group incorporated Duma TanzGraphite Limited (“Duma’), a new Tanzanian company in which EcoGraf’s
subsidiary, EcoGraf (UK) Pty Ltd, holds an 84% interest and the Government of Tanzania holds a 16% free carried interest.
Duma was incorporated to develop and manage the Epanko Graphite Project ("the Project").
The Framework and Shareholders Agreements, signed on 17 April 2023, specify the key rights and obligations of the parties
with respect to the development and management of the Project.
58
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 23. Consolidated Entity Information
Information about subsidiaries
The financial statements of the consolidated entity include the following subsidiaries:
Country of incorporation
2023
2022
Percentage owned (%)
Australia
Australia
Australia
Australia
Australia
Australia
Australia
United Kingdom
United Kingdom
Mauritius
Tanzania
Tanzania
Tanzania
Tanzania
Tanzania
Tanzanian Exploration Company Pty Ltd
TanzGraphite Pty Ltd
TanzGraphite (AUS) Pty Ltd
EcoGraf (Australia) Pty Ltd
HFfree Pty Ltd (previously Westoz Technologies Pty Ltd)
Innogy Limited
Innogy Minerals Holdings Pty Ltd
Innogy Minerals (UK) Pty Ltd
EcoGraf (UK) Pty Ltd
EcoGraf (Mauritius) Limited
EcoGraf (Tanzania) Limited
TanzGraphite (TZ) Limited
Innogy Minerals (TZ) Limited
Frontier Minerals (TZ) Limited
Duma TanzGraphite Limited
24. Parent Information
EcoGraf Limited
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Share based payment reserve
Loan share reserve
Accumulated losses
Total equity
Loss of the parent entity
Total comprehensive loss of the parent entity
100
100
100
100
100
100
100
100
100
100
100
100
100
100
84
2023
$’000
38,960
22,356
61,316
(2,379)
(41)
(2,420)
58,896
99,834
10,450
(945)
(50,443)
(58,896)
(14,316)
(14,316)
100
100
100
100
100
100
100
100
-
100
100
100
100
100
-
2022
$’000
47,236
18,463
65,699
(2,249)
(32)
(2,281)
63,418
99,834
9,825
(1,399)
(44,842)
63,418
(7,505)
(7,505)
59
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity did not have any guarantees at 30 June 2023 or 30 June 2022.
Contingent liabilities
The parent entity did not have any contingent liabilities at 30 June 2023 or 30 June 2022.
Capital commitments
The parent entity did not have any capital commitments at 30 June 2023 or 30 June 2022.
Significant accounting policies
The financial information for the parent entity has been prepared on the same basis as the consolidated financial statements,
except as set out below.
Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries, associates and joint venture entities are accounted for at cost.
25. Financial Instruments
The consolidated entity is exposed to a variety of financial risks, including market risk, credit risk and liquidity risk.
The consolidated entity’s financial instruments consist of cash and deposits with banks, accounts receivable and accounts
payable. No trading in any financial instruments is undertaken.
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of
measurement and the basis on which income and expense are recognised, in respect of each class of financial asset,
financial liability and equity instrument, are disclosed in note 27. Unless otherwise stated, the carrying amounts of financial
instruments reflect their fair value.
The main risks arising from the consolidated entity’s financial instruments are foreign currency risk, interest rate risk, liquidity
risk and credit risk. The Board determines policies for managing each of these risks and they are summarised below.
Foreign currency risk
The consolidated entity operates internationally and undertakes certain transactions denominated in foreign currency
resulting in exposure to foreign currency risk through foreign exchange rate fluctuations. Foreign exchange risk also arises
as a result of controlled entities of the Company with functional currencies other than Australian Dollars, the Company's
functional currency.
The Group currently does not engage in any hedging or derivative transactions to manage foreign currency risk.
The carrying amount, in Australian Dollars of the consolidated entity’s foreign currency denominated financial assets and
financial liabilities at the reporting date were as follows:
Cash and cash equivalents
Trade and other payables
2023
$’000
20
-
4
-
24
2022
$’000
19
-
3
-
-
22
2023
$’000
521
13
2
91
16
643
2022
$’000
63
9
15
107
-
194
USD
EUR
TZS
GBP
ZAR
Total
60
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 The financial impact of a 10% change in the Australian Dollar exchange rate on the consolidated entity is as follows:
Appreciation in AUD exchange rate
Depreciation in AUD exchange rate
%
change
10%
10%
Effect on loss
before tax
$’000
Effect on
equity
$’000
29
12
29
12
%
change
10%
10%
Effect on loss
before tax
$’000
Effect on
equity
$’000
(29)
(12)
(29)
(12)
2023
2022
Interest rate risk
The consolidated entity’s exposure to market risk for changes in interest rates arises from holding cash and deposits. Funds
held in operating accounts and term deposits earned variable interest at rates ranging between 0% to 4.54% (2022: 0% to
3.01%), depending on the type of bank account and cash balance. The consolidated entity does not have interest-bearing
loans or borrowings.
The interest-bearing financial instruments held by the consolidated entity are:
Cash and cash equivalents
Other financial assets - term deposits at bank
2023
$’000
38,606
-
38,606
2022
$’000
6,728
40,000
46,728
A change of 1% in the variable interest rate at the reporting date would have an impact on the consolidated entity profit and
loss and equity of $408,000 (2022: $467,000) assuming all other variables remain constant.
Liquidity risk
Liquidity risk is the risk that the consolidated entity will not be able to meet its financial obligations as and when they fall due.
The consolidated entity manages liquidity risk by maintaining adequate cash reserves, by continuously monitoring actual and
forecast cash flows and by matching the maturity profiles of its financial assets and liabilities.
The following table sets out the contractual maturity of the consolidated entity’s financial instrument liabilities based on
undiscounted cash flows.
Carrying
amount
$’000
Contractual
cash flows
$’000
1 year or less
$’000
Between 1
and 2 years
$’000
Between 2
and 5 years
$’000
2023
Trade and other payables
1,866
1,866
1,603
2022
Trade and other payables
2,126
2,126
2,126
-
-
263
-
Credit risk management
Credit risk is the risk that a counterparty will default on its contractual obligations resulting in a financial loss to the
consolidated entity. The consolidated entity is exposed to credit risk from its bank deposits and other receivables as
disclosed in the statement of financial position. The consolidated entity does not have any significant credit risk exposure to
any single counterparty or any consolidated entity of counterparties having similar characteristics.
The credit risk on liquid funds is managed through the use of counterparty banks with acceptable credit-ratings assigned by
international credit-rating agencies (S+P Australian AA-, Tanzanian B).
61
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 Holdings by geographical region
Cash and cash equivalents
Australia
$’000
38,581
Tanzania
$’000
25
Total
$’000
38,606
The maximum exposure to credit risk at the reporting date is the carrying value disclosed in note 6.
Fair value measurement
The carrying amounts of Other receivables and Trade and other payables are assumed to approximate their fair values due to
their short-term nature.
26. Events After Balance Date
There have been no events that have arisen between 30 June 2023 and the date of this report or any other item, transaction
or event of a material and unusual nature likely, in the opinion of the directors, to materially affect the operations of the Group,
the results of those operations or the state of affairs of the Group, in future financial years.
27. Significant Accounting Policies
a) Basis of consolidation
The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at 30 June
2023. Subsidiaries are entities that are controlled by the Company. Control is achieved when the Company is exposed to, or
has rights to, variable returns from its involvement with its subsidiaries and has the ability to affect those returns through its
capacity to direct the activities of its subsidiaries.
Specifically, the consolidated entity controls a subsidiary if, and only if, the consolidated entity has:
• power over the subsidiary (i.e., existing rights that give it the current ability to direct the relevant activities of the subsidiary);
• exposure, or rights, to variable returns from its involvement with the subsidiary;
• the ability to use its power over the subsidiary to affect its returns.
Generally, there is a presumption that a majority of voting rights results in control. To support this presumption and when the
consolidated entity has less than a majority of the voting or similar rights of an subsidiary, the consolidated entity considers all
relevant facts and circumstances in assessing whether it has power over a subsidiary, including:
• the contractual arrangement(s) with the other vote holders of the subsidiary;
• rights arising from other contractual arrangements;
• the consolidated entity’s voting rights and potential voting rights.
The consolidated entity re-assesses whether or not it controls an entity if facts and circumstances indicate that there is a
change to the elements of control. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the
year are included in the consolidated financial statements from the date the consolidated entity gains control until the date
the consolidated entity ceases to control the subsidiary.
When necessary, adjustments are made to the financial statements of subsidiaries to align to their accounting policies with
the consolidated entity. All consolidated entity assets and liabilities, equity, income, expenses and cash flows relating to
transactions between members of the consolidated entity are eliminated in full on consolidation.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.
62
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 b) Taxes
Current income tax
Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation
authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at
the reporting date in the countries where the consolidated entity operates and generates taxable income.
Current income tax relating to items recognised directly in equity is recognised in equity and not in the statement of profit or
loss. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax
regulations are subject to interpretation and establishes provisions where appropriate.
Deferred tax
Deferred tax is provided using the liability method on temporary differences between the tax bases of assets and liabilities
and their carrying amounts for financial reporting purposes at the reporting date. Deferred tax is recognised for all taxable
temporary differences, except:
•
•
when the deferred tax arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a
business combination and at the time of the transaction, it affects neither the accounting profit nor taxable profit or loss; or
in respect of temporary differences associated with investments in subsidiaries, associates and interests in joint
arrangements, when the timing of the reversal of the temporary differences can be controlled and it is probable that the
temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the
deductible temporary differences and the carry forward of unused tax credits and unused tax losses can be utilised.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised
deferred tax assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that
future taxable profits will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is
realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the
reporting date.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets
against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.
c) Exploration and evaluation expenditure
Exploration and evaluation expenditure in relation to separate areas of interest for which rights of tenure are current is
carried forward as an asset in the statement of financial position where it is expected that the expenditure will be recovered
through the successful development of an area of interest, or by its sale, or exploration activities are continuing in an area
and activities have not reached a stage which permits a reasonable estimate of the existence or otherwise of economically
recoverable reserves.
Where a project or an area of interest has been abandoned, the expenditure incurred thereon is written-off in the year in
which the decision is made.
Once the technical feasibility and commercial viability of the extraction of mineral resources in an area of interest are
demonstrable, exploration and evaluation assets attributable to that area of interest are first tested for impairment and then
transferred to mine properties and development.
Payments for exploration and evaluation expenditure are recorded net of any government grants.
63
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 d) Property, plant and equipment
Each class of property, plant and equipment is carried at cost less, where applicable, any accumulated depreciation and
impairment losses.
Property, plant and equipment is recorded at the value directly attributable to bringing the asset to the location and condition
necessary for it to be capable of operating in the manner intended by management.
The carrying amount of property, plant and equipment is reviewed annually by directors to ensure it is not in excess of the
amounts recoverable on the basis of net cash flows that are expected to be received from the employment and subsequent
disposal of the assets.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it
is probable that future economic benefits associated with the item will flow to the consolidated entity and the cost of the item
can be measured reliably. Repairs and maintenance expenses are charged to the profit and loss during the financial period in
which they are incurred.
Depreciation
The depreciable amount of all property, plant and equipment is depreciated on a straight-line basis over their useful lives,
commencing from the time the asset is held ready for use as follows:
Plant and equipment
Motor vehicles
Office furniture and equipment
2–5 years
5 years
4 - 8 years
Residual values of the assets and their useful lives are reviewed and if necessary adjusted, at each reporting date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater
than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount and are included in the profit
and loss component of the statement of comprehensive income.
e)
Impairment of non-financial assets
At each reporting date, the consolidated entity reviews the carrying values of its tangible and intangible assets to
determine whether there is any indication that those assets have been impaired. If such an indication exists, the
recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared
to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the profit
or loss component of the consolidated statement of profit or loss and other comprehensive income.
Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.
Where it is not possible to estimate the recoverable amount of an individual asset, the entity estimates the recoverable
amount of the cash-generating unit to which the asset belongs.
f)
Foreign currency transactions and balances
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 the Company's functional 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
the statement of profit or loss, except when deferred in equity as qualifying cash flow hedges and qualifying net investment
hedges.
64
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 Subsidiaries
On consolidation, the assets and liabilities of foreign operations are translated into Australian Dollars at the exchange rate
prevailing at the reporting date and their statements of profit or loss are translated at exchange rates prevailing at the dates
of the transactions. Exchange differences arising on translation for consolidation are recognised in other comprehensive
income. On disposal of a foreign operation, the component of other comprehensive income relating to that particular foreign
operation is recognised in the profit or loss.
Exchange differences on monetary items receivable from or payable to a foreign operation for which settlement is neither
planned nor likely to occur (therefore forming part of the net investment in the foreign operation), are recognised initially in
other comprehensive income and reclassified from equity to profit or loss on repayment of the monetary items.
g) Operating segments
Operating segments are presented on the same basis as the internal reports provided to the chief operating decision maker
who is responsible for the allocation of resources to operating segments and for assessing their performance.
h) Employee benefits
Provision is made for the consolidated entity’s liability for employee benefits arising from services rendered by employees up
to reporting date. Short term employee benefits have been measured at the amounts expected to be paid when the liability is
settled, plus related on-costs. Long term employee benefits have been measured at the present value of the estimated future
cash outflows to be made for those benefits.
Share-based payments
Equity-settled share-based compensation benefits are provided to employees and directors.
The cost of equity-settled transactions is measured at fair value on grant date. Fair value is independently determined using
pricing models that takes into account the exercise price, the term of the option, the impact of dilution, the share price at
grant date and expected price volatility of the underlying share, the expected dividend yield, and the risk-free interest rate for
the term of the option, together with non-vesting conditions that do not determine whether the consolidated entity receives
the services that entitle the employees to receive payment. No account is taken of any other vesting conditions.
The cost of equity-settled transactions is recognised as an expense with a corresponding increase in equity over the vesting
period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate
of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit
or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous
periods.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification had not been made. An
additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of
the share-based compensation benefit as at the date of modification.
If a non-vesting condition is within the control of the consolidated entity or employee, the failure to satisfy the condition is
treated as a cancellation.
If the condition is not within the control of the consolidated entity or employee and is not satisfied during the vesting period,
any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If an equity-settled award is cancelled, it is treated as if it has vested on the date of cancellation and any remaining expense
is recognised immediately, unless those equity instruments do not vest because of failure to satisfy a vesting condition (other
than a market condition) that was specified at grant date. If a new replacement award is substituted for the cancelled award,
the cancelled and new award are treated as if they were a modification.
i)
Issued capital
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.
65
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 j)
Investments and other financial assets
Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial
measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at either
amortised cost or fair value depending on their classification. Classification is determined based on both the business model
within which such assets are held and the contractual cash flow characteristics of the financial asset unless an accounting
mismatch is being avoided.
Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the
consolidated entity has transferred substantially all the risks and rewards of ownership. When there is no reasonable
expectation of recovering part or all of a financial asset, it’s carrying value is written off.
Financial assets at fair value through profit or loss
i.
Typically, such financial assets will be either: (i) held for trading, where they are acquired for the purpose of selling in the
short-term with an intention of making a profit, or a derivative; or (ii) designated as such upon initial recognition where
permitted. Fair value movements are recognised in profit or loss.
Financial assets at fair value through other comprehensive income
ii.
Financial assets at fair value through other comprehensive income include equity investments which the consolidated entity
intends to hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition.
Impairment of financial assets
iii.
The Group recognises a loss allowance for expected credit losses on financial assets. The amount of expected credit
losses is updated at each reporting date to reflect changes in credit risk since initial recognition of the respective financial
instrument.
The Group recognises lifetime expected credit losses (ECL) for financial assets. The expected credit losses are estimated
using a provision matrix based on the Group’s historical credit loss experience, adjusted for factors that are specific to the
debtors, general economic conditions and an assessment of both the current as well as the forecast direction of conditions at
the reporting date, including time value of money where appropriate.
Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a
financial instrument.
k) Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks and other short-term highly liquid
investments with original maturities of 3 months or less.
l)
Revenue
Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer
at an amount that reflects the consideration to which the consolidated entity expects to be entitled in exchange for those
goods or services.
Other revenue is recognised when it is received or when the right to receive payment is established. All revenue is stated net
of the amount of goods and services tax (GST).
m) Other income
Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate
applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial
asset to that asset’s net carrying amount.
Research and development tax credits, are recognised where they can be reliably measured and it is certain that the credit
will be received.
66
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 n) Goods and services tax (GST)/ Value Added Tax (VAT)
Revenues, expenses and assets are recognised net of the amount of GST/VAT, except where the amount of GST/VAT
incurred is not recoverable from the relevant tax authorities. In these circumstances the GST/VAT is recognised as part of the
cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the statement of financial
position are shown inclusive of GST/VAT.
The net amount of GST/VAT recoverable from, or payable to, the tax authorities is included as part of receivables or payables.
Cash flows are presented in the statement of cash flows on a gross basis, except for the GST/VAT recoverable component of
investing and financing activities, which are disclosed as operating cash flows.
o) Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit or loss attributable to the owners of EcoGraf Limited, 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 any bonus elements in ordinary shares issued during the financial year.
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 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.
p) Government grants
Government grants are recognised where they can be reliably measured, it is certain that the grant will be received, and all
attached conditions will be satisfied. When the grant relates to an expense item, it is recognised as income on a systematic
basis over the periods that the related costs for which it is intended to compensate, are expensed. When the grant relates to
an asset, it is offset against the capitalised amount and recognised as income in equal amounts over the expected useful life of
the related asset (when the asset is depreciated).
q) Leases policy
The consolidated entity assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract
conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
Consolidated entity as a lessee
The consolidated entity applies a single recognition and measurement approach for all leases, except for short-term leases
and leases of low-value assets. The consolidated entity recognises lease liabilities to make lease payments and right-of-use
assets representing the right to use the underlying assets.
(i)
Right-of-use assets
The consolidated entity recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying
asset is available for use). 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. If
ownership of the leased asset transfers to the consolidated entity 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. Refer to the accounting policies in section (e) Impairment of non-financial assets.
67
EXTRACT UPGRADE RECYCLENotes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 ii)
Lease liabilities
At the commencement date of the lease, the consolidated entity 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 the exercise price of a purchase
option reasonably certain to be exercised by the consolidated entity and payments of penalties for terminating the lease, if
the lease term reflects the consolidated entity 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.
r)
Trade and other payables
These amounts represent liabilities for goods and services provided to the consolidated entity prior to the end of the financial
year and which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The
amounts are unsecured and are usually paid within 30 days of recognition.
s) Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the
consolidated entity’s normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within
12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used
to settle a liability for at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the consolidated entity’s normal operating cycle;
it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no
unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities
are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
t) Critical accounting estimates and judgements
The directors evaluate estimates and judgements incorporated into the financial report based on historical knowledge and
best available current information. Estimates assume a reasonable expectation of future events and are based on current
trends and economic data, obtained both externally and generated internally by the consolidated entity.
Key estimates — impairment
The consolidated entity assesses impairment at each reporting date by evaluating conditions specific to the entity that may
lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Value- in-
use calculations performed in assessing recoverable amounts incorporate a number of key estimates.
Recoverability of exploration and evaluation costs
The consolidated entity assesses the recoverability of the carrying value of capitalised exploration and evaluation costs
at each reporting date (or at closer intervals should the need arise). In completing this assessment, regard is had to the
consolidated entity’s intentions with regard to proposed future exploration and development plans for individual exploration
areas, to the success or otherwise of activities undertaken in individual areas in recent times, to the likely success of future
planned exploration activities and to any potential plans for divestment of individual areas. Any required adjustments to the
carrying value of capitalised exploration are completed based on the results of this assessment.
Share-based payments
Refer to note 19 for estimates applied in determining the share-based payments expense.
68
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 Notes to the Consolidated
Financial Statements
For the Year Ended 30 June 2023
u) New accounting standards and interpretations
The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board (‘AASB’) that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
28. Standards Issued But Not Yet Effective
Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2023
reporting periods and have not been early adopted by the consolidated entity.
The following standards issued but not yet effective are relevant to the Group. When these standards are is first adopted for
the year ending 30 June 2024, there will be no material impact on the transactions and balances recognised in the financial
statements.
Standard or
Pronouncement
AASB 2020-1
Amendments to
Australian Accounting
Standards –
Classifications of
Liabilities as Current or
Non-Current
AASB 2020-6
Amendments to
Australian Accounting
Standards –
Classification of
Liabilities as Current or
Non-current – Deferral
of Effective Date
AASB 2021-2
Amendments to
Australian Accounting
Standards – Disclosure
of Accounting Policies
and Definition of
Accounting Estimates
Who does
it affect?
Effective
date
All entities
Annual
reporting
periods
beginning
on or after
1 January
2023.
Description
This narrow-scope amendment to AASB 101 Presentation of
Financial Statements clarifies that liabilities are classified as either
current or non-current depending on the rights that exist at the
end of the reporting period, and also clarifies the definition of
settlement of a liability.
For example, a liability must be classified as non-current if an
entity has the right at the end of the reporting period to defer
settlement of the liability for at least 12 months after the reporting
period.
AASB 2020-6 defers the mandatory effective date of
amendments that were originally made in AASB 2020-1 so that
the amendments are required to be applied for annual reporting
periods beginning on or after 1 January 2023 instead of 1 January
2022.
This amending Standard impacts a number of standards:
All entities
- AASB 7: clarifying that information about measurement bases
for financial instruments is expected to be material to an entity’s
financial statements;
- AASB 101: requiring entities to disclose their material
accounting policy information rather than their significant
accounting policies;
- AASB 108: clarifying how entities should distinguish changes in
accounting policies and changes in accounting estimates.
- AASB 134: identifying material accounting policy information as
a component of a complete set of financial statements, and
- AASB Practice Statement 2, providing guidance on how
to apply the concept of materiality to accounting policy
disclosures.
Annual
reporting
periods
beginning
on or after
1 January
2023.
69
EXTRACT UPGRADE RECYCLE Standard or
Pronouncement
AASB 2021-5:
Amendments to
Australian Accounting
Standards – Deferred
Tax related to Assets
and Liabilities
arising from a Single
Transaction
Description
Who does
it affect?
Effective
date
AASB 2021-5 amends the initial recognition exemption in AASB
112 Income Taxes such that it is not applicable to leases and
decommissioning obligations – transactions for which companies
recognise both an asset and liability and that give rise to equal
taxable and deductible temporary differences.
All entities
Annual
reporting
periods
beginning
on or after
1 January
2023
70
ANNUAL REPORT 2023ECOGRAF LIMITED Notes to the Consolidated Financial StatementsFor the Year Ended 30 June 2023 Directors’ Declaration
In the directors’ opinion:
1.
The financial statements, comprising the consolidated statement of profit or loss and other comprehensive income,
consolidated statement of financial position, consolidated statement of cash flows, consolidated statement of changes
in equity and accompanying notes, are in accordance with the Corporations Act 2001 and:
a)
b)
Comply with accounting standards and the Corporations Regulations 2001, and
Give a true and fair view of the financial position at 30 June 2023 and of the performance for the year ended on
that date.
2.
3.
4.
The Company has included in the notes to the financial statements an explicit and unreserved statement of compliance
with International Financial Reporting Standards.
In the directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and
when they become due and payable.
The 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.
Andrew Spinks
Managing Director
Perth, 29 September 2023
71
EXTRACT UPGRADE RECYCLE
Auditor’s Report
72
ANNUAL REPORT 2023 INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ECOGRAF LIMITED Opinion We have audited the financial report of EcoGraf Limited (the Company) and its subsidiaries (the Group), which comprises the consolidated statement of financial position as at 30 June 2023, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the directors' declaration. In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the Group's financial position as at 30 June 2023 and of its financial performance for the year then ended; and (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board's APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor's report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. ECOGRAF LIMITED Auditor’s Report
73
EXTRACT UPGRADE RECYCLE Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Key Audit Matter How our audit addressed this matter Exploration and Evaluation Assets Refer to Note 8 in the financial statements The Group has capitalised exploration and evaluation expenditure with a carrying value of $22,975,000 as at 30 June 2023. We considered this to be a key audit matter due to the significant management judgments involved in assessing the carrying value of the asset including: • Determination of whether the expenditure can be associated with finding specific mineral resources, and the basis on which that expenditure is allocated to an area of interest; • Determination of whether exploration activities have progressed to the stage at which the existence of an economically recoverable mineral reserve may be assessed; and • Assessing whether any indicators of impairment are present, and if so, judgments applied to determine and quantify any impairment loss. Our audit procedures included: • Assessing the Group’s accounting policy for compliance with accounting standards; • Obtaining management’s reconciliation of capitalised exploration and evaluation expenditure by area of interest and agreeing it to the general ledger; • Assessing whether the Group’s right to tenure of each area of interest is current; • Agreeing a sample of additions to supporting documentation and testing that the amounts are capital in nature and relate to the area of interest; • Assessing and evaluating management’s assessment of whether indicators of impairment existed as at 30 June 2023; • Enquiring with management and reviewing budgets and other supporting documentation as evidence that active and significant operations in, or relation to, the area of interest will be continued in the future; • Assessing management’s determination that exploration and evaluation activities have not yet reached a stage where the existence or otherwise of economically recoverable reserves may be reasonably determined; and • Assessing the disclosures in the financial statements. Auditor’s Report
74
ANNUAL REPORT 2023ECOGRAF LIMITED Share-based payments Refer to Note 19 in the financial statements The Group has in place equity-based incentive arrangements consisting of performance rights and loan shares. Management have accounted for these equity instruments in accordance with AASB 2 Share-based Payment. We have considered this to be a key audit matter because: • The complexity of the accounting associated with these instruments and management’s estimation in determining the fair value of these instruments; • Management judgement is required to determine the probability of meeting the vesting conditions of the instruments and the inputs used in the valuation model to value these instruments; and • The recognition of the share-based payment expense is complex due to the variety of vesting conditions attached to these instruments. Our audit procedures included: • Assessing the Group’s accounting policy for compliance with Australian Accounting Standards; • Obtaining an understanding of the terms and conditions of the instruments accounted for during the year; • Assessing the completeness of these instruments at reporting date; • Assessing the appropriateness of management’s valuation methodology used to determine the fair value of the instruments accounted for during the year; • Critically assessing management’s determination of the vesting probability of each instrument; • Recalculating the amount of share-based payment expense recognised for the year ended and the reserve movement during the year; and • Assessing the disclosures in the financial statements. Other Information The directors are responsible for the other information. The other information comprises the information included in the Group's annual report for the year ended 30 June 2023 but does not include the financial report and the auditor's report thereon. Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon. In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Directors for the Financial Report The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporation Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so. Auditor’s Report
75
EXTRACT UPGRADE RECYCLE Auditor's Responsibilities for the Audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at: https://www.auasb.gov.au/auditors_responsibilities/ar2.pdf. This description forms part of our auditor's report. Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in the directors' report for the year ended 30 June 2023. In our opinion, the Remuneration Report of EcoGraf Limited, for the year ended 30 June 2023, complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. RSM AUSTRALIA PARTNERS Perth, WA TUTU PHONG Dated: 29 September 2023 Partner Shareholder Information
Details of securities as at 27 September 2023
Capital structure
Securities
Fully paid ordinary shares
Performance rights subject to vesting conditions and expiry
Top 20 holders of ordinary shares
The 20 largest registered holders of fully paid ordinary shares were:
Rank Name
1
2
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
CITICORP NOMINEES PTY LIMITED
3 MR ANDREW PETER SPINKS
4
5
6
7
DR PETER DENNETT MEIER & MRS LYNETTE SUZANNE MEIER
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
BCV NOMINEES PTY LTD
REINDEER INVESTMENTS PTY LIMITED
8 MR KOSTA TRAJKOVSKI & MRS SUSANNE TRAJKOVSKI
9
10
11
CORNWALL HOLDINGS PTY LTD
PHELPS HILL INVESTMENTS PTY LTD
LAX CONSULTING PTE LTD
12 MR NICHOLAS BOLGER
13 MRS LORRAINE ATKINSON
14
15
GUNPIN PTY LTD
BNP PARIBAS NOMS PTY LTD
16 MR NICOLA CONIDI & MRS GIANNINA CONIDI
17
18
19
20
NICK CONIDI PTY LTD
GR ENGINEERING SERVICES LIMITED
DIZZY HOGAN PTY LTD
DR DANIEL HAUSTEAD
Number
452,591,877
11,612,657
Number of Ordinary
Shares held
% of
issued capital
120,271,706
40,533,630
11,644,522
10,883,340
6,611,045
5,245,825
3,257,692
3,233,904
3,179,615
3,077,418
3,039,318
2,641,501
2,632,500
2,500,000
2,412,829
2,401,417
2,310,031
2,068,904
2,019,402
1,842,415
26.57
8.96
2.57
2.40
1.46
1.16
0.72
0.71
0.70
0.68
0.67
0.58
0.58
0.55
0.53
0.53
0.51
0.46
0.45
0.41
Total
231,807,014
51.22
76
ANNUAL REPORT 2023ECOGRAF LIMITED Shareholder Information
Distribution of Listed Securities
A distribution schedule of fully paid ordinary shares:
Range
100,001 and Over
10,001 to 100,000
5,001 to 10,000
1,001 to 5,000
1 to 1,000
Total
Unmarketable parcels
Holders
Number of Shares
409
2,173
1,241
2,564
934
7,321
361,879,215
73,253,964
9,761,556
7,061,869
635,273
%
79.96
16.19
2.16
1.56
0.14
452,591,877
100.00
Holdings less than a marketable parcel of ordinary shares (being 4,545 shares as at 27 September 2023):
Holders
Number of Shares
3,173
6,090,592
Unquoted securities
Unquoted securities on issue were as follows:
Class
Performance rights
Performance rights
Performance rights
Performance rights
Performance rights
Performance rights
Expiry
Date
Number of
Rights
Number of
Holders
19 January 2026
5,675,000
7 December 2026
7 December 2027
500,000
320,825
29 December 2027
1,000,000
21 February 2028
164,275
21 February 2028
3,952,557
11,612,657
7
1
1
2
1
4
The Performance rights are subject to performance milestones and were issued under the Incentive Performance Rights Plan.
Voting Rights
The voting rights attaching to ordinary shares are:
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.
Performance rights do not carry any voting rights.
On-Market Buy Back
There is no current on-market buy-back.
77
EXTRACT UPGRADE RECYCLE Summary of Tenements
Mineral tenements
Consolidated entity’s 100% interest:
Area (km2)
Project
Location (Region/Country)
26.42
23.23
2.60
2.08
20.77
2.62
46.72
6.73
9.62
35.31
2.76
2.57
2.81
4.50
23.45
2.49
299.00
299.66
229.48
299.90
297.36
298.26
299.63
299.57
216.32
288.27
182.96
298.40
299.63
288.87
277.57
287.33
287.59
288.86
294.85
Arusha-Merelani
Arusha-Merelani
Arusha-Merelani
Arusha-Merelani
Arusha-Merelani
Arusha-Merelani
Arusha-Merelani
Arusha-Merelani
Epanko
Epanko
Epanko
Epanko
Epanko
Epanko
Epanko
Epanko
Golden Eagle
Golden Eagle
Northern Frontier
Northern Frontier
Northern Frontier
Northern Frontier
Northern Frontier
Northern Frontier
Northern Frontier
Northern Frontier
Northern Frontier
Southern Frontier
Southern Frontier
Southern Frontier
Western Frontier
Western Frontier
Western Frontier
Western Frontier
Western Frontier
Manyara, Tanzania
Manyara, Tanzania
Manyara, Tanzania
Manyara, Tanzania
Manyara, Tanzania
Manyara, Tanzania
Manyara, Tanzania
Manyara, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Manyara, Tanzania
Manyara, Tanzania
Kagera, Tanzania
Kagera, Tanzania
Kagera, Tanzania
Kagera, Tanzania
Kagera, Tanzania
Kagera, Tanzania
Kagera, Tanzania
Kagera, Tanzania
Kagera, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Ulanga, Tanzania
Katavi, Tanzania
Katavi, Tanzania
Rukwa, Tanzania
Rukwa, Tanzania
Rukwa, Tanzania
Licence
PL 7907/201211
PL 10092/2014
PL 10872/2016
PL 11081/2017
PL 11082/2017
PL 11143/2017
PL 11196/2018
PL 11386/2019
ML 548/2015
PL 17824/20212
PL 9331/2013
PL 10388/2014
PL 10390/2014
PL 17823/20212
PL 11598/2021
PL 11600/2021
PL 19373/20222
PL 20188/20222
PL 11668/2021
PL 11667/2021
PL 11837/2022
PL 11841/2022
PL 11915/2022
PL 19369/20222
PL 19362/20222
PL 19368/20222
PL 21914/20222
PL 11838/2022
PL 11839/2022
PL 11840/2022
PL 19350/20222
PL 19352/20222
PL 19353/20222
PL 19354/20222
PL 19355/20222
1 Tenement conversion in progress
2 Application in progress
78
ANNUAL REPORT 2023ECOGRAF LIMITED
Mineral Resources
and Ore Reserves
Information
Governance and Internal Control
EcoGraf Limited ensures that all Mineral Resource Estimates are subject to appropriate levels of governance and internal
controls. Estimation procedures are well established and are subject to systematic internal peer review and external technical
review undertaken by competent and qualified professionals. These reviews have not identified any material issues. EcoGraf
Limited also periodically reviews this governance framework to ensure it remains appropriate for the requirements of its
business activities.
Mineral Resources and Ore Reserves Estimates are reported on an annual basis in accordance with the 2012 Edition of
the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (‘JORC Code’). Mineral
Resource Estimates are quoted inclusive of Ore Reserves. Competent Persons named are Members or Fellows of The
Australasian Institute of Mining and Metallurgy and/or The Australian Institute of Geoscientists and qualify as Competent
Persons as defined under the JORC Code.
Epanko Graphite Project Mineral Resources Estimate
30 June 20231
Tonnage
(Mt)
Grade
(%TGC)
21.5
41.7
65.1
128.2
Classification
Measured
Indicated
Inferred
Total
1 February 2023 Mineral Resources Estimate for the Epanko Deposit>5.5% TGC
Classification
Measured
Indicated
Inferred
Total
Tonnage
(Mt)
7.5
12.8
10.4
30.7
1 March 2017 Mineral Resources Estimate for the Epanko Deposit>8% TGC
Epanko Graphite Project Ore Reserves Estimate
Classification
Proven
Probable
Total
Tonnage
(Mt)
5.7
5.9
11.7
7.7
7.6
7.2
7.4
30 June 20221
Grade
(%TGC)
9.8
10.0
9.9
9.9
30 June 20231
Grade
(%TGC)
8.4
8.2
8.3
Contained
Graphite
(Kt)
1,650
3,165
4,690
9,510
Contained
Graphite
(Kt)
739
1,280
1,031
3,050
Contained
Graphite
(Kt)
483
488
971
79
EXTRACT UPGRADE RECYCLE Mineral Resources
and Ore Reserves
Information
Classification
Proven
Probable
Total
30 June 20221
Tonnage
(Mt)
Grade
(%TGC)
5.7
5.9
11.7
8.4
8.2
8.3
1 Mineral Reserves are quoted from blocks where the TGC grade is greater than 5%.
Merelani–Arusha Graphite Project Mineral Resources Estimate
Classification
Measured
Inferred
Total
Classification
Measured
Inferred
Total
30 June 2023
Tonnage
(Mt)
Grade
(%TGC)
7.4
10.3
17.7
6.7
6.3
7.4
30 June 2022
Tonnage
(Mt)
Grade
(%TGC)
7.4
10.3
17.7
6.7
6.3
7.4
Contained
Graphite
(Kt)
483
488
971
Contained
Graphite
(Kt)
500
650
1,150
Contained
Graphite
(Kt)
500
650
1,150
Notes to the Mineral Resource Estiimate and Ore Reserve tables above
• The Epanko and Merelani-Arusha Graphite Projects are located in Tanzania.
• Totals may not sum due to rounding.
• Mt = 1,000,000 tonnes.
• Tonnage figures have been rounded to the nearest 1,000 and % TGC grades have been rounded to 1 decimal place.
Competent Persons’ Statement
The information in this report that relates to Exploration Results is based on information compiled by Mr. Andrew Spinks, a
Competent Person, who is a Member of The Australasian Institute of Mining and Metallurgy and is employed by EcoGraf
Limited. Mr. Spinks has sufficient experience which is relevant to the style of mineralisation and type of deposit under
consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of
the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr. Spinks consents to the
inclusion in the report of the matters based on his information in the form and context in which it appears.
The information in this report that relates to Mineral Resources is based on information compiled by Mr. David Williams,
a Competent Person, who is a Member of The Australasian Institute of Mining and Metallurgy and is employed by CSA
Global Pty Ltd, an independent consulting company. Mr. Williams has sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent
Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves”. Mr. Williams consents to the inclusion in the report of the matters based on his information in the form and
context in which it appears.
80
ANNUAL REPORT 2023ECOGRAF LIMITED Mineral Resources
and Ore Reserves
Information
The information in this report that relates to Ore Reserves has been compiled by Mr. Steve O’Grady who is a Member of The
Australasian Institute of Mining and Metallurgy. Mr. O’Grady is employed by Intermine Engineering and produced the Ore
Reserve estimate based on data and geological information supplied by Mr. Williams. Mr. O’Grady has sufficient experience
that is relevant to the estimation, assessment, evaluation, and economic extraction of the Ore Reserve that he is undertaking
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. O’Grady consents to the inclusion in the report of the matters based on his
information in the form and context in which it appears.
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EXTRACT UPGRADE RECYCLE ECOGRAF LIMITED
8282
ANNUAL REPORT 2023
ANNUAL REPORT 2023 Corporate Directory
Directors
Non-Executive Chairman
Robert Pett
Andrew Spinks Managing Director
John Conidi
Keith Jones
Non-Executive Director
Non-Executive Director
Company Secretary
Howard Rae and Karen Logan
Registered and Principal Office
Level 3, 18 Richardson Street
West Perth WA 6005
Telephone: +61 8 6424 9000
Internet:
Email:
www.ecograf.com.au
info@ecograf.com.au
Share Registry
Link Market Services
Level 12, QV1 Building
250 St Georges Terrace
Perth WA 6000
Telephone: 1300 554 474 (toll free within Australia)
Email:
registrars@linkmarketservices.com.au
Solicitors
Steinepreis Paganin
Level 4, The Read Buildings
16 Milligan Street
Perth WA 6000
Telephone: +61 8 9321 4000
Facsimile:
+61 8 9321 4333
King & Wood Mallesons
Level 30, QV1 Building
250 St Georges Terrace
Perth WA 6000
Telephone: +61 8 9269 7000
+61 8 9269 7999
Facsimile:
Auditor
RSM Australia Partners
Level 32, Exchange Tower
2 The Esplanade
Perth WA 6000
Telephone: +61 8 9261 9100
Facsimile:
+61 8 9261 9111
Bankers
Westpac Banking Corporation
Level 3, Tower 2
123 St Georges Terrace
Perth WA 6000
Stock Exchange Listings
Australian Securities Exchange
ASX Code: EGR
Frankfurt Stock Exchange (Börse Frankfurt)
FSE Code: FMK
OTCQX Stock Exchange
OTCQX Code: ECGFF
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ECOGRAF LIMITED ABN 15 117 330 757
ASX: EGR FSE: FMK OTCQX: ECGFF
www.ecograf.com.au