Annual
2024
Report
Directors
Oliver Kleinhempel
Non-executive Director
Non-executive Chairman
Stephen Layton
Non-executive Director
Richard Morrow
Non-executive Director
Stephen Weir (Appointed 19 January 2024)
Non-executive Director
Zhui Pei Yeo
Non-executive Director
Company Secretary
Melanie Leydin
Registered Office
Level 4, 100 Albert Road
South Melbourne VIC 3205
T +61 (0)7 4094 3072
W www.eqresources.com.au
E info@eqresources.com.au
Principal Place of Business
6888 Mulligan Highway
Mount Carbine QLD 4871
Share Register
Automic Pty Ltd
Level 5, 126 Philip Street
Sydney NSW 2000
T +61 (0)2 9698 5414
Auditors
Nexia Melbourne Audit Pty Ltd
Level 35, 600 Bourke Streett
Melbourne VIC 3000
T +61 (0)3 8613 8888
F +61 (0)3 8613 8800
Stock Exchange Listing
Listed on the Australian Securities Exchange (ASX)
ASX Code: EQR
ACN: 115 009 106
ABN: 77 115 009 106
Corporate Directory
1
Chairman’s Address
2
Chief Executive Officer’s Letter
4
Operating and Financial Review
4
Corporate & Financing Activities
11
Sustainability
20
Mt Carbine Operations
50
Saloro/Barruecopardo Operations
66
Competent Persons Statement
69
Directors’ Report
81
Consolidated Statement of Profit or Loss and Other Comprehensive Income
82
Consolidated Statement of Financial Position
83
Consolidated Statement of Cash Flows
84
Consolidated Statement of Changes in Equity
85
Notes to the Consolidated Financial Statements
121
Consolidated Entity Disclosure Statement
122 Directors’ Declaration
123 Auditor’s Independence Declaration
124 Independent Auditor’s Report
129 Shareholder Information
133 Forward Looking Statements
Contents
Chairman’s Address
Our teams deliver on the
synergies, driven by the diverse
expertise and everybody’s
commitment to have both
operations strive and succeed.
Dear Shareholders and Friends of EQR,
It is my great pleasure to present to you the 2024 Annual Report for EQ Resources Limited. To reflect on the past
12 months, allow me to rewind with a personal note.
Back in 2018, I had my first interactions with Saloro’s management team. This was not at all related to the later
transactions between the Companies. Instead, it was a joint effort with several European research institutes to
develop technologies that would allow the recovery of critical raw materials from challenging mineral deposits
and old mine waste stockpiles – it goes without saying that our laser-like focus was on Tungsten! To collaborate
efficiently on such topics and towards a tangible outcome, one needs to share the same vision on how our sector
could generate value and contribute to society in a sustainable way!
Teamwork Above All
Since my first interactions referred to above, mutual respect, trust and transparency formed the basis of many
discussions. This has fully transpired into the leadership teams and are defined principles of the collaboration
between both sites which now form the EQ Resources Group. Weekly team meetings between the senior members
from both locations continue to forge the relationship and already started to deliver on the synergies driven by the
diverse expertise and everybody’s commitment to have both operations strive and succeed.
Continue Developing an Ecosystem
We continue engaging with key customers and partners, truly believing in the value that strong ecosystems
can deliver to all its members. We have built a solid relationship with one of our key customers, Masan High-
Tech Materials. Both sides believe in win-win-constellations. The Companies exchange technical information to
effectively allow for a better utilisation of the tungsten resources mined at our sites and shipped to Vietnam. We
recently announced a strategic collaboration with Elmet Technologies, a leading US tungsten manufacturer “far
down our value chain”. This was intentional; we need and want to be closer to the end-users.
Discipline at the Core
The general outlook and recent performance of the Company look promising. Nevertheless, (cost) discipline and
governance must remain at the core of our operations. As the Company grows, the management and board
competencies need to expand in parallel. The Company has attracted incredible talent, as a key ingredient for
any successful Company. Strategic optionality can be best played with a strong balance sheet. Our priorities are,
therefore, clearly defined, and we are looking positively into the coming 12 months!
On behalf of the Board, I would like to thank all shareholders for their continued support.
.
Oliver Kleinhempel
Non-Executive Chairman
EQ Resources Ltd
EQ Resources Limited Annual Report 2024
1
Chief Executive Officer’s Letter
Dear Shareholders,
As we reflect on the past year, I am proud of the extraordinary progress EQ Resources (“EQR”) has made. This
past year has been transformative for the Company, driven by a series of strategic milestones that have fortified
our position as the leading primary tungsten producer outside of Asia and Russia. With each step forward, we have
demonstrated our commitment to operational excellence, continuous improvement in safety, sustainable growth,
and value creation for our shareholders.
Saloro Acquisition: A World-Class Asset
One of the most exciting developments this year was the acquisition of Saloro’s Barruecopardo mine, a world-class
tungsten project with high-quality equipment and an exceptional team of professionals. This acquisition is a game-
changer for EQR. It not only expands our portfolio of premium tungsten assets but also enhances our production
capacity and bolsters our standing in the global tungsten market. The integration of Saloro into our operations
hasn’t been without its challenges, but it is starting to bear the fruits of our labour and we are confident that this
asset will contribute significantly to our growth in the near term.
Unlocking the Potential of Mt Carbine
Mt Carbine continues to demonstrate its tremendous potential. Over the past year, we have made significant strides
in open-cut mining operations growing our production profile along with operational outputs. The underground
mine has a promising future, with the majority of Resources yet to be converted to Reserves with several high-
value and high-priority mining areas identified as great underground mining targets. This presents a substantial
opportunity for resource expansion and value realisation as we progress with our conversion efforts.
Moreover, we are now mining zones rich in high-grade tungsten, with grade increasing at depth. Our latest rounds
of drilling have confirmed this, and we are confident that as we continue to expand our operations at Mt Carbine,
the best is yet to come. I believe the quality of the ore we are encountering positions us well to deliver strong
production volumes and increase shareholder value over the next 12 months.
Leading the Western Tungsten Market
With the continued growth of Mt Carbine, the addition of Saloro and the grant of the Wolfram Camp exploration
permit, EQR has solidified its position as the largest primary tungsten concentrate producer outside of Asia and
Russia. This achievement is particularly significant given the strategic importance of tungsten in global supply
chains. Tungsten is critical mineral for modern technologies, and our operations ensure a stable and secure supply
of this essential material to industries globally.
In an environment where global demand for critical minerals is increasing, our leadership in tungsten production
places EQR at the forefront of the industry’s future. We remain committed to scaling our operations responsibly
and sustainably to meet this demand.
EQ Resources is focused on long-term
growth, leveraging our expanding
operations and sustainable practices to
strengthen our leadership in the tungsten
market and deliver lasting value for our
shareholders well into the future.
2
EQ Resources Limited Annual Report 2024
A Sustainable Path Forward
As we look to the future, sustainability remains at the core of everything we do. Our approach to environmental
stewardship, safety and community engagement ensures that we operate in a manner that benefits not only our
shareholders but also the broader communities in which we operate. Both operations are corresponding on ESG
initiatives and evolving as a Company.
Outlook for 2025 and Beyond
As we move into 2025, we are positioned for another year of robust growth. Our focus will remain on delivering
consistent production from Mt Carbine, advancing the underground potential, and optimising Saloro production
outputs and plant recoveries. With ongoing exploration and development, we believe that EQR will continue to
grow as a leader in the critical minerals sector, delivering long-term value for our shareholders.
I would like to extend my gratitude to our dedicated team, whose hard work and expertise continue to drive our
success. I would also like to thank our shareholders for your continued support and confidence in our vision.
Together, we are building a stronger, more resilient future for EQ Resources, and I am excited about the opportunities
that lie ahead.
Thank you.
Kevin MacNeill
Chief Executive Officer
EQ Resources Ltd
Aerial view of Saloro’s Barruecopardo mine, Salamanca Province, Spain.
EQ Resources Limited Annual Report 2024
3
Corporate & Financing Activities
EQR Completes Acquisition of Saloro S.L.U. and $25 Million Placement with Oaktree
On 18 January 2024, EQR and Oaktree Capital Management, L.P. (“Oaktree”) satisfied all conditions precedent for
EQR’s acquisition of Saloro S.L.U. The transaction also comprised a $25 million placement to Oaktree at 9c per
share, resulting in Oaktree now holding a 15% stake in the Company. To further streamline Saloro’s key banking
relationships, the Company agreed to reduce third-party bank debt by €10 million, compared to €5 million as per
the initial transaction agreements. The transformational acquisition strengthens EQR’s relevance in the global
tungsten industry, with the Company becoming the largest independent tungsten concentrate producer outside of
China. Oaktree’s investment in EQR enhances the Company’s shareholder register and capital market positioning,
supporting the further expansion of both the Mt Carbine and Barruecopardo operations.
Production ‘key performance indicators’ at Saloro strongly improved since collaborative work was first established
between EQR and Saloro. Since acquisition, a further debottlenecking program, including the doubling of XRT
sorting capacity, has been undertaken with initial efforts focused on improving the jigging plant and ongoing
enhancements in the spirals and shaking table sections, leading to significantly better metal recoveries.
Another key area of production expansion involves XRT ore sorting. Saloro’s Barruecopardo Mine, with its coarse
scheelite, is well-suited for this technology. Following successful trials and results from the first TOMRA XRT Ore
Sorter, introduced in August 2023, Saloro and EQR purchased a second unit, which arrived in December 2023.
This addition aims to positively impact costs, utility consumption, and overall metal recovery at the Barruecopardo
operation.
See ASX Announcement 18th January 2024: ‘EQR Completes acquisition of Saloro S.L.U. and $25 Million placement with
Oaktree’.
Operating and Financial Review
4
EQ Resources Limited Annual Report 2024
Changes in EQR Board & Leadership Team
• Non-executive Director since August 2019, Chair since April 2020.
• Experience in project development, finance, commodity trading.
• Previous roles at Outotec, Ferrostaal Group, CRONIMET.
• Executive director at CRONIMET Holding GmbH.
Oliver Kleinhempel - Non-Executive Chairman
•
Appointed in November 2017.
•
35+ years in equity capital markets in the UK and Australia.
•
Experience in ASX listings, corporate advisory.
•
Directorships at Mithril Silver and Gold Limited and Pursuit
Minerals Limited.
Stephen Layton - Non-Executive Director
•
Appointed in August 2019.
•
Background in executive management, project planning,
resource management.
•
Works in system integration in telecoms in South-East
Asia.
•
Executive director at a steel-product manufacturer.
Zhui Pei Yeo - Non-Executive Director
•
Appointed in March 2021.
•
Over 30 years as a sharebroker, interested in
resources sector.
•
Chairman of Melbourne Mining Club.
•
Investment roles at Lowell Resources Fund
Management; Fellow of AusIMM.
Richard Morrow - Non-Executive Director
•
Background in mining, finance; former CEO of
Magnetite Mines Ltd.
•
Experience in corporate advisory, project finance,
construction management.
•
Member of the Australian Institute of Company
Directors, GBA Capital Advisory Board.
Stephen Weir - Non-Executive Director
Board of Directors
Stephen Weir was appointed to the Board of Directors of EQR on 19th January 2024 as Oaktree’s nominee Director
and Chair of the Audit & Risk Committee.
Mr Weir is a former Chief Executive Officer of Magnetite Mines Ltd (ASX:MGT), a company focused on the
development of the Razorback Iron Ore Project in the Braemar region of South Australia. Mr Weir’s prior fields of
expertise and senior executive roles span the mining, industrial services, energy and infrastructure sections. He
has a 20-year career in corporate advisory with RFC Ambrian where he was a Managing Director, preceded by
project finance (Bankers Trust), general management (Brambles) and construction management (John Holland
Engineering).
See ASX Announcement 19th January 2024: “Stephen Weir joins EQR’s Board of Directors”.
Another change in the leadership team is the appointment of Evren Ören as Chief Operating Officer for the Saloro
Operations in February 2024. With an academic background in Mining Engineering, Mineral Processing, and
Business Administration, Evren brings global experience in optimising mineral processing plants, operations, and
EPC management. Proficient in Spanish and English, his cross-cultural skills strengthen operations and foster
collaboration within the group.
A$20M Funding Facility from QIC for Mt Carbine Mine Expansion
The Company and Queensland Investment Corporation (“QIC”) have entered into an agreement to establish a
three-year funding facility. QIC will provide up to A$20 million from the Queensland Critical Minerals and Battery
Technology Fund (“QCMBTF”). The fund’s main goal is to support the mining and refining of essential minerals and
the development and production of battery technologies and advanced materials in Queensland.
The 3-year loan facility will accelerate the Company’s 2 mtpa processing capacity expansion plan ongoing at the
Mt Carbine Tungsten Mine with A$12M in Tranche 1. Tranche 2 of A$8M will enable the Company to push forward
with the initial phase of the 2024 drilling program, aiming at defined underground targets, and to integrate these
findings into a comprehensive underground feasibility study. The underground resource, which has been minimally
explored, is accessible via a 1980s decline that was reopened after the quarter-end and presents higher grades
and significant potential for resource expansion. This funding is contingent on meeting standard prerequisites,
including project completion tests.
See Announcement 8th May 2024: ‘QIC approves A$20M funding for Mt Carbine Tungsten Mine expansion’.
EQ Resources Limited Annual Report 2024
5
Deputy Premier, Treasurer and Minister for Trade and Investment
Cameron Dick commented:
“Our investment through the Queensland Critical Minerals and Battery Technology
Fund provides a pathway for EQ Resources to extend the existing mine by further
exploring tungsten resources accessible through underground mining. New plant
equipment, drill testing and trial mining is forecast to increase capacity and extend
the mine’s life by at least five years, ensuring global demand for tungsten
continues to deliver local opportunities for Far North Queenslanders.”
QIC’s State Chief Investment Officer Allison Hill commented:
“Securing additional tungsten mineralisation will strengthen Queensland’s
position as a significant contributor to global critical minerals supply chains.
There are relatively few mines globally in a position to fill anticipated supply-
demand gaps for tungsten as existing outputs are challenged and demand for
clean energy technologies grows.”
Research and Development Tax Refund
The Company received a cash refund of $2.17 million, in May 2024, following the submission and approval of its
Research and Development (R&D) Tax Refund application for the 2023 financial year. This refund has been granted
in recognition of various eligible R&D activities conducted during the year at EQR’s Mt Carbine Mine.
See ASX Announcement 10th May 2024: ‘Mt Carbine Receives A$2.17M R&D Tax Refund’.
Successful Placement of A$9.5M to Continue Mt Carbine Expansion
In May 2024 EQR completed a A$9.5 million placement of new fully paid ordinary shares (New Shares) and options
(New Options) to institutional and sophisticated investors (Placement). A broad range of high-quality institutional
investors showed strong support for the placement. The issue price for the Placement was A$0.045 (4.5 cents) per
share with 1-for-3 free attaching unlisted New Options, exercisable at A$0.0675 (6.75 cents). The Placement was
conducted by Pac Partners Securities Pty Ltd (Lead Manager) and GBA Capital Holdings (Co-Manager). Funds
managed by Oaktree Capital Management L.P. (Oaktree) retained 15% of the Placement to ensure its continued
interest in EQR.
On 29 May 2024, 205,940,008 million New Shares were issued at an issue price of $0.045 (4.5 cents) per share,
along with 68,646,669 New Options, exercisable at A$0.0675 (6.75 cents) expiring on 29 May 2027. A further
20,000,000 New Options were issued to brokers on the same terms as the Placement Options. Directors subscribed
for 5,111,111 New Shares and 1,703,704 New Options (equivalent to A$230,000).
The Company has issued 39,304,733 New Shares and 13,101,577 New Options to Director Zhui Pei Yeo (or his
nominee), plus withholding tax, as repayment of his A$1,798,570 loan to the Company.
See ASX Announcement 21st May 2024: ‘Successful placement of A$9.5M to accelerate Mt Carbine Expansion’.
Convertible Notes
EQR announced on 28 September 2023 that investors holding the 4 million convertible notes issued in 2021 fully
converted their notes into EQR ordinary shares. The 2-year interest-bearing convertible notes were partially
converted in September 2021, for an amount of $2 million (equal to 2 million notes), with the balance $4 million
(equal to 4 million notes) converted just before its due date.
See ASX Announcement 13th September 2023: “Early Works Funding Secured for Mt Carbine Expansion Well Ahead of
BFS Release” ; ASX Announcement 28th September 2023: “Investors Convert 100% of Convertible Notes as Mt Carbine
Mine Ramp-up Continues”.
A further issue of 750,000 convertible notes took place on 6th November 2023 with an aggregate principal value
of $750,000. The notes are convertible at the option of the noteholders into ordinary shares at a conversion price
of $0.100 per share at any time after issuance and up to the close of business on the maturity date.
EQR Executes Definitive Agreement to Acquire Mt Carbine JV Interest from Cronimet
On 21 May 2024, the Company executed the definitive agreement related to the Joint Venture Interest Transfer
(Agreement) with CRONIMET Asia Pte Ltd (CR Asia) and CRONIMET Australia Pty Ltd (CR Australia) for the
acquisition of CR Australia’s 50% joint venture interest in the Mt Carbine Retreatment Joint Venture (JV).
Operating and Financial Review continued
6
EQ Resources Limited Annual Report 2024
The Agreement formalises the binding Heads of Agreement (HoA) entered into in October 2023, which was subject
to financial and legal due diligence by the parties
See ASX Announcement 18th October 2023: ‘Strategic Partner Cronimet Joins EQR Register, As EQR Acquires JV
Interest From Cronimet’.
In 2019, EQR, through its wholly owned subsidiary Mt Carbine Retreatment Pty Ltd (“MCR”), and CR Asia, through
its wholly owned subsidiary CR Australia, embarked on a Joint Venture to reprocess the historic Mt Carbine tailings
and low-grade ore stockpiles, known as the Mt Carbine Tungsten Operation.
Under this arrangement, CR Australia and MCR each held a 50% interest in the JV. As part of that JV arrangement,
CR Asia prepaid an initial US$3.5 million, subsequently increased by an additional US$3 million (currently US$6.5
million), for a long-term offtake agreement for 25,000 tonnes of tungsten concentrate from the Mt Carbine Tungsten
Operation (Offtake Agreement). CR Australia loaned US$2.2 million in working capital into the JV and a further
US$3.2 million for equipment leases, including one XRT Ore Sorter and various material handling equipment. EQR
will assume 100% of these liabilities under the Agreement.
With the successful operation of the processing plant and the expansion of operations to include the Andy White
Open Pit, EQR and CR Australia have agreed to a streamlined JV structure with EQR purchasing CR Australia’s
50% interest in the JV subject to conditions precedent.
See ASX Announcement 21st May 2024: ‘EQR executes definitive agreement to acquire Mt Carbine JV interest from
Cronimet’.
Strategic Partners
Endorsement Through Fundings and Grants
EQ Resources Limited Annual Report 2024
7
Macroeconomics and Market Trends
The tungsten market is highly responsive to the global commodity market, known for its volatility in both price and
demand, with macroeconomic conditions and geopolitical risks being major factors contributing to this instability.
Rising geopolitical tensions around the world, exemplified by the ongoing conflicts between Russia and Ukraine
and the unrest between Israel and Palestine, are heightening risks in international markets. These conflicts not
only disrupt local economies but also have far-reaching effects on global trade and resource distribution, posing
significant challenges for industries reliant on stable international relations. Due to political instabilities, the
demand for tungsten in the defense industry has been rising, driven by its applications in military products such as
projectiles, armor-penetrating ammunition, and other hardware, where its density and hardness are highly valued.
The defence industry has witnessed the sharpest rise of all the segments of the tungsten market, but represents
only around 15% of the market and has not been a critical enough influence on the global demand to be the main
driver of the rise in prices witnessed in the last quarter of FY2024.
Market movements are largely fuelled by the supply and demand for high-performance, wear-resistant materials
in diverse industries such as automotive, aerospace, and electronics. The widespread application of tungsten in
manufacturing cutting tools, drill bits, and components that must endure high temperatures, highlights its critical
role in sectors that demand materials with exceptional durability under extreme conditions. Moreover, tungsten’s
increasing utilisation in the electronics sector for making electron emitters and electrical contacts also contributes
significantly to the market’s growth.
Primary Tungsten Production by Country
Tungsten Reserves by Country
83.3%
5.7%
3.0%
1.8%
1.5%
1.2%1.1% 1.1% 0.8%
0.5%
Total World –
79kt
Total World –
3,700 kt
51.4%
32.5%
10.8%
2.7%
1.4%0.8% 0.3%0.1%
China
Portugal
Other Countries
Korea, North
Russia
Spain
Vietnam
Rwanda
Austria
Bolivia
For tungsten market dynamics update, see: "Inverstors Update/Webinar".
Operating and Financial Review continued
8
EQ Resources Limited Annual Report 2024
Tungsten Uses
Aviation
Aerospace
Military
Heavy
Machinery
Heavy
Industry
Tools &
Construction
Medical
EV Battery
Development
Automotive
Science
& Tech
Green
Energy
Micro
Electronics
Demand was low during the first half of the past year due to significant destocking driven by the high-interest rate
environment, and recovered later in the second half of the financial year, primarily due to an environmental audit
of tungsten producers in China. However, the price recovery was primarily driven by demand for concentrate due
to low stockpiles at production facilities, rather than by downstream demand, as end-product demand recovery
has yet to materialise.
Economic Importance
Supply Risk
Source: European Commission list of critical raw materials, 2023.
EQ Resources Limited Annual Report 2024
9
Currently, the low availability of tungsten concentrate persists, with strong demand from both Western and Chinese
consumers, all of whom are trying to secure long-term material supply to cope with production uncertainties. In
addition, recent tariffs implemented in the US are also pushing Western tungsten consumers to secure non-Chinese
and sustainable supply, which remains quite scarce. This aligns with EQR’s strategy to support the redevelopment
of Western mines in favourable jurisdictions.
While numerous projects have been announced in the recent years to provide new Western supply, very few
are currently operating, and even less are able to reach their nameplate capacity, putting more pressure on the
supply side, a favourable factor for EQR’s own production. However, a few projects are due for completion in the
next year or so, and this additional supply, pending that commissioning goes as per announced plans, may have a
detrimental impact on the APT price.
In China, while the government is limiting the export of non-processed material, there is currently no indication that
a total export ban could be considered. Should this ever happen, EQR would be in a leading position to support
the Western strategic supply.
In line with global industry trends, the tungsten market is set to experience changes in supply allocations. According
to Fastmarkets, ‘The total tungsten (tungsten trioxide content 65%) mining quota in China will be 114,000 tonnes in
2024, which was up by 3,000 tonnes from 111,000 tonnes in 2023,’ as reported in August 2024. This increase in the
mining quota reflects a growing demand for tungsten, which is pivotal for the strategic planning and operational
adjustments moving forward. As the largest producer of tungsten, China’s production levels are significant
indicators that directly influence global supply and pricing strategies.
280
290
300
310
320
330
340
350
360
370
Aug-23
Sep-23
Oct-23
Nov-23
Dec-23
Jan-24
Feb-24
Mar-24
Apr-24
May-24
Jun-24
US$ / mtu
APT Price CIF Rotterdam - (US$/mtu WO3)
High
Mid
Low
APT price changes 12 months High, Mid & Low. Source: Fast Market APT Price CIF Rotterdam.
APT CIF Rotterdam prices rose to US$335-360 per mtu by the end of June, reaching a two-year high as increasing
demand coincides with tightening supply.
Given the range of factors which contribute to the price of tungsten, and the fact that pricing is subject to
negotiation, it is difficult for EQR to predict with certainty the prices at which tungsten will be sold. The effects of
changes in assumptions about future prices may include, among other things, changes to Mineral Resources and
Ore Reserves estimates, as well as the assessment of the recoverable amount of EQR’s assets.
Operating and Financial Review continued
10
EQ Resources Limited Annual Report 2024
Sustainability
As an early adopter of Environmental, Social, Governance (ESG) practices, EQ Resources is committed to
responsible resource development, aligning its values with sustainable operations to drive economic growth while
protecting the environment.
EQR’s ESG strategy, built on the Turner and Townsend framework, aligns with global Sustainability Standards,
including International Council on Mining and Metals (ICMM), Global Reporting Initiative (GRI), United Nations
Sustainable Development Goals (UN SDGs) and Australian Climate Related Financial Disclosures. The program
focuses on key areas important to the business and stakeholders, with a commitment to ongoing development of
both environmental and social initiatives.
For more details, visit the Sustainability page of EQR’s website.
EQR Core Values
Act Safe. Feel
Safe.
Embrace
Difference
Tread Lightly
Dig Deep
Buddy Up
Lead with
Integrity
Act safe at
work. Care
and respect
each
other. Feel
safe to be
yourself.
Diversity of
thinking, skills
and
background
creates value
and drives
innovation.
Embed
resource
efficiency to
minimise
environmental
footprint &
deliver positive
societal
impact.
Go one better.
Strive to
continuously
learn and
improve.
Challenge the
status quo.
Collaboration
is key to
realising
shared value.
Have courage
to do the right
thing. Be
accountable.
ESG Achievements
The year 2023-24 has been a productive year for EQ Resources’ ESG progress, below are the key milestones:
2023 Q4
Published sustainability section in Annual Report
2023 Q4
Finalist in Project Controls Expo Sustainability project of the year
2023 Q4
Commenced communicating ESG through our Values in quarterly update
2023 Q4
Second Stakeholder Sentiment Survey disseminated to key EQR stakeholders
2024 Q1
Sustainability incorporated into Quarterly reports
2024 Q1
ARTEH engaged to continue GHG emissions tracking at Mt Carbine
2024 Q2
Review of sustainability metrics carried out, high-level alignment to ICMM principles
completed. Updated alignment to UN SDG’s.
2024 Q2
Completed 2024 Stakeholder ESG Engagement Survey, results analysed
2024 Q2
Review completed of ESG workbook and EQRs initiatives updated
2024 Q3
Gain understanding of how incoming EU and Australian Sustainability Reporting Standards
impact EQR and commence forward-planning for future reporting requirements
2024 Q4 Planned
Sustainability Risk Assessment
2024 Q4 Planned
Decarbonisation planning to commence
EQ Resources Limited Annual Report 2024
11
ESG Showcase Mt Carbine and Saloro
Genuine initiatives are driven by EQR’s core values and stakeholder sentiment surveys. Highlighted ESG
initiatives are displayed on the ESG Showcase page on the EQR website and are updated regularly:
Operating and Financial Review continued
12
EQ Resources Limited Annual Report 2024
Decarbonisation – Mt Carbine
Net Zero Readiness Assessment
EQR initiated its decarbonisation roadmap in 2023
with a Net Zero Readiness Assessment, guided by
ESG consultants and aligned with the Task Force on
Climate-Related Financial Disclosures (TCFD). The
assessment covered key indicators to evaluate assets,
operations, and general awareness, providing a clear
direction for EQR’s decarbonisation strategy at Mt
Carbine.
Emissions tracking and reporting
EQR actively tracks greenhouse gas emissions at Mt
Carbine, focusing on Scope 1 and 2 emissions, with
limited Scope 3 categories, in partnership with ARTEH.
Although emissions levels do not trigger the thresholds
for the National Greenhouse and Energy Reporting
Scheme (NGERS) or the Safeguard Mechanism, EQR
is aligning with Australian Climate-Related Financial
Disclosure requirements. EQR is committed to
enhancing its emissions data collection and optimising
decarbonisation opportunities across its operations.
Facility Threshold
Corporate Threshold
Safeguard Mechanism Threshold
25 kt or more of Scope 1 and 2
emissions and / or production
or consumption of 100 TJ or
more of energy.
50 kt or more of Scope 1 and 2
emissions and / or production
or consumption of 200 TJ or
more of energy.
100 kt of more of Scope 1
emissions at the facility.
Decarbonisation Strategy and Future Planning
In Q4 2024, EQR will continue developing its Decarbonisation Strategy, with a roadmap expected by Q1 2025. This
plan will use 2023-24 emissions data as a baseline and will be informed by the outcomes of the Sustainability Risk
Assessment, focusing on climate change mitigation, energy and water efficiency, and technology adoption.
Stakeholder Engagement and Workshops
To support decarbonisation efforts, EQR will conduct a workshop to engage internal stakeholders on emissions
reduction strategies. Originally scheduled for Q3 2024, this workshop was deferred to accommodate the transition
to owner-operated mining at Mt Carbine. EQR remains pragmatic, applying practical decarbonisation solutions
across both Australian and Spanish operations.
EQ Resources Limited Annual Report 2024
13
2024 Stakeholder Sentiment Survey- Mt Carbine
See: Sustainability Framework & ESG Strategy incl. 2024 Materiality Assessment and Decarbonisation Roadmap.
The 2024 ESG Stakeholder Sentiment Survey helped gather insights into material ESG themes from a diverse
group of stakeholders, including employees, community members, and board members. Feedback reflected
positive changes in areas such as waste management, water security, and employee retention since 2021.
Stakeholder Quotes
“EQR
makes
themselves
available
to
stakeholders on request” “EQR are
improving all the time” “Our tailings dams
show how little impact the mine has on the
surrounding environment with birds, fish and
even fresh water crocodiles.” “EQR sets a
good example in an industry that gets a bad
rap” “EQR are proactive with community
engagement, have a good reputation and
should
continue
building
trust
with
neighbouring landholders, Traditional Owners,
local council and community” “EQR has a
good reputation in the community. Keep doing
what you’re doing” “Very proud of the
Company's continued diligence & attention to
ESG responsibilities” “Thank you for the
opportunity to send our impressions on EQR's
ESG commitments” “Being a growing mine,
safety culture is always hard to build but I really
feel like we are going in the right direction” “I
have confidence in the Project leadership
team”
ESG Materiality
Stakeholders rated top material themes as Water & Resources, Risk & Compliance, and Health, Safety & Wellbeing.
External stakeholders also prioritised community engagement.
Stakeholder Feedback
EQR received positive feedback on its ESG efforts, highlighting transparency, environmental protection, community
engagement, and safety culture.
ESG Focus Areas
Stakeholders prioritised Employment Attraction & Retention, Water & Resources, and Health, Safety & Wellbeing
as key focus areas for future ESG efforts.
EQR is committed to incorporating its stakeholders’ feedback into its future ESG strategy and program. EQR will
continue to prioritise areas identified by stakeholders as of ‘material importance’ as well as those areas identified
as an ‘opportunity for focused improvement’ in the survey.
Operating and Financial Review continued
14
EQ Resources Limited Annual Report 2024
Sustainability Plans for the Future
Sustainability Reporting
Australia
EQR continues to evolve its sustainability reporting by collecting environmental metrics and social data in alignment
with the Global Reporting Index (GRI) and the International Council of Mining and Metals (ICMM). The Company
actively tracks health, safety, community engagement, and diversity metrics, highlighting them in the Annual
Report. EQR has assessed its compliance with the upcoming Australian Sustainability Reporting Standards (ASRS),
effective from January 2025. Based on its assets, revenue, and NGERS thresholds, EQR falls under Group 3, with
reporting commencing on 1 July 2027. EQR is preparing by expanding emissions data collection and planning a
Sustainability Risk Assessment.
Spain
With the European Sustainability Reporting Standards (ESRS) framework evolving and delays for certain sectors
and non-EU companies, EQR is closely monitoring changes. Although full compliance may not affect EQR and
Saloro until 2028, EQR is preparing for future obligations, particularly in supply chain sustainability.
Wolfram Camp
The award of a 488 km2 exploration permit at Wolfram Camp, North Queensland, strengthens EQR’s position
within a key tungsten cluster, highlighting its potential to develop a critical mineral hub. This permit offers an
opportunity to sustainably redevelop the pre-existing tungsten mine, following EQR’s proven approach.
See QLD Government Statement, 18th June 2024: “Permit granted to unlock critical minerals and jobs at historic Far
North Queensland mine site”.
An ESG Desktop Analysis identified key areas for the project, highlights include:
−
Localised job creation and community initiatives,
−
Refurbishment and expansion of the tungsten processing plant, aligned with Mt Carbine operations,
−
Application of transferable technologies like TOMRA XRT Ore Sorting, tailings development, and robust
environmental practices,
−
Programs for employee attraction and retention.
EQ Resources Limited Annual Report 2024
15
Sustainability Risk Assessment
EQR plans to conduct a Sustainability Risk Assessment in Q4 2024 as part of its proactive approach to prepare
for ASRS compliance. Involving key management and operational employees, this assessment will help evaluate
EQR’s sustainability risk profile, including climate change, and identify areas for development to meet emerging
climate-related disclosure requirements.
Operating and Financial Review continued
INSIGHTS
231
Total EQR Staff as
of end of June 2024
Growth
4.9
New starters
per month
Retention
100%
employees live in
the local region
Buddy Up
23%
Women employees
across EQR Operations 7%
Indigenous Mt
Carbine employees
Embrace Difference
+131%
Growth of Employees (with
the integration of Saloro)
Growth
53.0%
Local suppliers (Queensland)
(58.3% in $ value of total
spending)
Buddy Up
86.3%
Australian suppliers (89% in
$ value of total spending)
Buddy Up
7
ESG related Governance
policy reviews
Lead with Integrity
Lead with Integrity
~1x
site tour per week
Dig Deep
63
completed ESG initiatives
ESG Initiatives in Progress
16
EQ Resources Limited Annual Report 2024
EQ Resources and UN SDG’s
EQR is committed to operating in alignment with the United Nations Sustainable Development Goals. The below
table is an updated representation of how EQR currently contributes to the Sustainable Development Goals.
SDG
Target
Current Alignment Summary
Alignment with
EQR Values
2.5
•
Rehabilitation of native flora through partnership
with AWC using diversified indigenous seed stock
•
Beehives on mine sites
•
Controlled fires for flora management (reseeding) in
partnership with MRWMG
Tread Lightly
3.6, 3.9
•
Health & Safety Policy
•
Promoting physical and psychological wellbeing
training of employees through implementation of
appropriate wellness programmes
Act Safe. Feel Safe.
4.4
•
Providing sustainable career paths and mentoring to
graduate employees on long term futures in the
mining industry.
•
Partnership with JCU to bring on PhD students.
•
Ongoing sponsorship and donations to local state
schools
Embrace Difference
Buddy Up
5.5
•
Diversity Policy
•
Bursary offered to female Uni participant
Embrace Difference
6.3, 6.4
•
Water management plan
Tread Lightly
7.2, 7.3
•
Participation in pilot GHG tracking program- ARTEH
•
Climate change risk position statement
•
Investigation into IPP and solar farm
Tread Lightly
Buddy Up
8.2, 8.4,
8.7
•
TOMRA XRT Waste sorting system
•
Modern Slavery Statement, Whistleblower Policy,
Human Rights Policy, Anti-Bribery & Corruption
Policy, Corporate Governance Statement
Embrace Different
Tread Lightly
Lead with Integrity
9.4, 9.5
•
TOMRA XRT Waste sorting system
•
Participating in AMECs ‘More Resourceful Than Ever’
Campaign
Embrace Different
10.2,
10.3,
10.4
•
Modern Slavery Statement, Whistleblower Policy,
Human Rights Policy, Diversity & Inclusion Policy,
Anti-Bribery & Corruption Policy, Grievance Process
Policy,
Lead with Integrity
11.4,
11.6,
•
Cultural Heritage Management Policy
•
Waste management plan, Air Quality management
plan
Tread Lightly
12.4,
12.5,
12.6
•
TOMRA XRT Waste sorting system
•
Stocking piling in quarry barren by- product for sale
as aggregated Product
•
Repurposing and delivering material for use in
regional road repairs and upgrades.
Dig Deep
Tread Lightly
Buddy up
13.1,
13.3
•
Continued participation in pilot GHG tracking
program with ARTEH
Tread Lightly
Buddy up
15.1,
15.2,
15.5,
15.8
•
Managing invasive freshwater aquatic weed species
in Frogbit Sentinel Network with Mareeba Shire
Council.
•
Australian Wildlife Conservancy (AWC) Partnership
•
Mitchell River Watershed Management Group –
invasive animal management
Tread Lightly
Buddy Up
16.2,
16.5,
16.6,
16.7
•
Modern slavery statement, Company Constitution,
Human Rights Policy, Anti-bribery and Corruption
Policy, ESG Policy, Communication & Disclosure
Policy, Whistleblower Policy, Code of Conduct
Lead with Integrity
EQ Resources Limited Annual Report 2024
17
Mt Carbine Operations
Operating and Financial Review continued
100
employees, as of June 2024
22.3%
female employees
9
senior employees
60+ years old
40+
contractors
7%
indigenous employees
99%
of employees live in
the Cairns region
12
Nationalities represented: South Africans,
Canadians, Koreans, Germans, Irish, French,
New Zealanders, Italians, British, and Spanish.
Australian of course
apprentices Cert III Surface Extraction, one
school-based apprentice, one electrician
apprentice, one maintenance apprentice
58%
of spending in Queensland
10.9%
of spending was international
HR:
PROCUREMENT/FINANCE:
18
EQ Resources Limited Annual Report 2024
750,000+
tonnes ore mined
650,000+
tonnes crushed
69,758
mtus recovered
43
blasts in FY2024
421,096
kilograms of explosives used
in FY 2024
1,400,000
tonnes waste mined
10,160
holes drilled
90.9
kilometres drilled
PRODUCTION:
EQ Resources Limited Annual Report 2024
19
Mt Carbine Operations
Mt Carbine Project Timeline
6
Processing of Historic Mineralised Stockpile – increasing with plant capacitiy
UG Resources Drill Out
Secure Funding
Facility
1 MTPA Plant Ordering & Construction
2023
2024
Q1
Q2
Q1
Q2
Q3
Q4
Q3
Q4
OC Mining – Stage 2
Jan-26
UG Mining
Starts
UG GeoTech &
Refurbishment
Q3
2025
Wolfram Camp
Exploration Permit
Granted
Acquisition of
Saloro, Spain
✓
$20M QIC
Funding Facility
✓
Approval –
Extraction Open Pit
Mining
Q2
Q4
Q1
2026
May 23
BFS Update
Western
Extension
Reserve
Update
Saloro MRE
Update
Restart - OC Mining – Stage 1
Open
Cut Infill
Drilling
✓
✓
Application - Wolfram
Camp Exploration
Permit
UG Re-
Opening
2nd Egress
Developt.
Trial
Mining
UG BFS
LGSP Mining
2 MTPA Plant Ordering & Construction
Open Cut
Mining
Restart
BFS
Update
Mt Carbine Tungsten Mine and Quarrying Operations, QLD, Australia, July 2024
1
Gravity Plant,
Procurement, Geo
Lab & Core Shed
2
Tailings Dam
3
Quarry & OOSR
Stock-pile
4
XRT Sorters
5
LG Ore Stockpile
6
Open Pit
1
2
3
4
5
7
8
Pit Operations
Offices
8
9
EQR Offices
9
6
7
Exploration Targets
Operating and Financial Review continued
20
EQ Resources Limited Annual Report 2024
Health and Safety
The employees at Mt Carbine continue to prioritise safety by proactively identifying and mitigating hazards before
beginning work activities. This proactive approach has been instrumental in maintaining the company’s strong
safety record.
During this period, collaboration between contractors and employees has been highly effective. New policies and
procedures have been implemented to ensure that the integration of Open Pit operations proceeds smoothly,
accommodating the increase in staff numbers and on-site activities. Additionally, a new induction package has
been introduced for new hires, and the training program has been enhanced to further support EQR’s workforce.
The graph below illustrates the rolling frequency rate, calculated based on data averaged over one year. This rate
is measured per million hours worked. Over the past year, the HSET team have logged 151, 027 man hours worked.
44
43
54
53
70
70
71
79
86
80
80
64
102.3
114.7
122.7
122.0
139.1
140.7
134.7
149.5
149.4
143.8
136.0
120.2
0
0
0
0
0
0
0
0
0
0
1
2
58.4
71.7
69.0
68.6
69.6
70.4
63.4
70.8
62.9
63.9
56.0
56.1
0
20
40
60
80
100
120
140
160
Jul-23
Aug-23
Sep-23
Oct-23
Nov-23
Dec-23
Jan-24
Feb-24
Mar-24
Apr-24
May-24
Jun-24
FREQUENCY
Rolling Frequency Rates 2024
LTIFR
Average QLD Quarries (LTIFR)
TRIFR
Average QLD Quarries (TRIFR)
CIFR
MTIFR
−
LTIFR: Lost Time
Injury Frequency Rate
−
Avg QLD Quarries
(LTIFR): Average
LTIFR for Queensland
Quarries
−
TRIFR: Total
Recordable Injury
Frequency Rate
−
Avg QLD Quarries
(TRIFR): Average
TRIFR for Queensland
Quarries
−
CIFR: Critical Injury
Frequency Rate
−
MTIFR: Medical
Treatment Injury
Frequency Rate
Other initiatives include:
−
Continuous communication through safety briefs and safety updates with reports of incidents on other mine
sites across Australia.
−
A contractor has been on site to actively monitor the working conditions of employees at Mt Carbine over a
two-day period. The monitoring involves collecting samples from identified Similar Exposure Groups (SEGs) to
assess risks in accordance with relevant legislation and QGL02 guidelines.
6,726
Take 5 Safety Assessments
79
JSEA Job Safety
Environment Analysis
22
Toolbox Talks
2
Prestart safety
meetings per day
PROACTIVE SAFETY INDICATORS
EQ Resources Limited Annual Report 2024
21
Operating and Financial Review continued
22
EQ Resources Limited Annual Report 2024
Open Pit Mining Operations
Geology
The FY2024 marked significant milestones in commissioning, production, ongoing exploration, and grade control
drilling. The mine initiated its first blast on June 28, 2023, and subsequently conducted 43 additional blasts,
each involving approximately 45-50,000 tonnes of material. Orana Pty Ltd was responsible for conducting the
drilling and blasting operations, while Orica Ltd supplied the necessary explosives, ensuring precise and effective
execution of blasting activities at the site.
Grade control measures have become a crucial aspect of EQR’s mining operations, guaranteeing uniform ore feed
grades at the crushing plant and understanding the orebody. The EQR geology team is instrumental in mapping
out ore zones within the open cut and ensuring that ore deliveries reach their specified bays before processing.
Grade Control Drilling
Grade control drilling using Reverse Circulation (RC) was carried out before the Open Pit operation in Q4 FY2023
on a 10 x 10-meter grid in 33-meter flitches ahead of mining operations to guide ore markups. A color-coded
system was implemented to distinguish between different ore grades: High-Grade Ore (WO3 > 0.2%) was marked
in pink, Low-Grade Ore (WO3 < 0.2%) in blue. A ROM (Run of Mine) pad was set up to store various grades of
material when necessary.
Picture Above: ROM 1 showing the separation of Low-Grade Ore (Blue: WO3 0.08-0.2%) and High-Grade Ore (Pink: WO3 > 0.2%).
The ore extracted from this process closely matches the 10 x 10-meter infill RC drilling results. The ore “markup”
system involves a combination of using the geological model for overall grade delineation and detailed mapping
enhanced with UV light examination.
During the Bankable Feasibility Study (BFS) phase, no new drilling was completed in the top 20 meters of the
Stage I Pit, relying on only three historical holes spaced 75 meters apart. This part of the pit revealed lower grades
than those inferred in the model for this zone. It wasn’t until mining reached the levels with recent drilling by EQR,
conducted at 50-meter intervals, that better grade correlations were observed. The discrepancies were likely due
to legacy issues, including poor survey control of hole locations and downhole trajectories and resulted in 21%
lower tungsten production for tonnage mined from the model in the top 20 meters of mining.
See ASX Announcement 12th May 2023: ‘EQR Begins Grade Control Drilling Ahead of Open Pit Restart’; ASX Announcement
19th July 2023: ‘Confirmation of Initial Ore Reserve Section at Mt Carbine’.
EQ Resources Limited Annual Report 2024 23
Infill Drilling Reveals High-Grade Zones in Stage II Pit
In the second half of FY2024, EQR completed 66 infill reverse circulation drill holes to confirm the consistency
of high-grade vein systems in Stage I & II Pit and to provide data for accurate grade control of upcoming pit
blasts. The drilling was initially conducted on the Iolanthe and the Johnson Vein Systems at the 350-340m level,
complementing the 2024 diamond drilling campaign. The drill rig was then moved to the 305-295m level on the
pit floor to complete a standard 10m x 10m spaced pattern.
The results confirmed the transformation in the ore body from a thinner network to substantial veins exceeding 50
cm at the 315-323m level, enhancing the understanding of the vein systems under UV light examination. The RC
drilling conducted at the 345m level showed significant zones with a tungsten grade of 0.21% WO3, nearly double
the expected grade according to the current modelling, with historical drilling indicating even higher grades
below this level. The mineralisation discovered is higher up in previously undrilled areas and transforms what was
considered waste into high-grade ore during Stage II Pit cutback from 368m RL to 325m RL. Both the Johnson
and Iolanthe Vein Systems show increasing width to the veins as they go deeper, and vein grades get stronger. The
overall zone narrows slightly, which is expected from the modelling.
Once infill drilling was completed in the upper levels, the recovered ore was within 6% accuracy of the predicted
interpretation. Drilling spacing of 30-50 meters is required to produce reliable results for Indicated Resources.
See ASX Announcement 30th April 2024: ‘Mt Carbine infill drilling reveals High Grade zones in Stage II Pit’;
ASX Announcement 3rd June 2024: ‘Mt Carbine infill drilling reveals high grade ore in Cutback’.
Level 295m RL confirms the thickening of the veins as seen on the cliff face looking into the Johnson Vein system.
The boundaries of the ore can often be extended using UV light to trace individual veins, which may have splays
and horsetails that are difficult to detect through drilling alone. The sporadic grade distribution, with clusters of
coarse tungsten causing a strong nugget effect, is mitigated using closely spaced grade-controlled holes.
Over the past 12 months of pit operations, the Company has gained confidence in the ore continuity within the
narrow vein package zones. The larger veins that define each package–such as Iolanthe, Bluff, Wayback, and
Johnson–have demonstrated consistent strike and depth. Mineralisation control has been observed between 225m
RL and 345m RL, representing the top of the system. At these depths, the veins broaden, and the packages show
higher grades, often merging. This coalescence is believed to result from horizontal jogs caused by movement
along the South Wall Fault, a thrust fault. Additionally, the high-angle strike-slip Iron Duke and Christmas Tree
faults have contributed to the structural preparation of the zone, allowing for open-spaced infill.
Operating and Financial Review continued
24
EQ Resources Limited Annual Report 2024
The sampling indicates that the mineralised
zones contain an average of 8-12% quartz, while
the mineralised zones have 6-8%. Within the
quartz, when isolating the scheelite-bearing
components, the geology team noticed that
40-70% of the quartz is mineralised. In lower-
grade ore, only 30-40% of the quartz is
mineralised. Once the targeted zone has been
mined, it may be preferable to shift to narrow
vein mining underground, as the wider zones
will no longer be present. Drilling has revealed
known mineralisation over a vertical range
from a height of 420m RL down to 110m RL in
the deeper holes. The larger veins remain open
at depth and along strike.
Simplified map of the Vein System with the veins being mined in FY2024 in
the Open Pit.
Cross-cut above shows the shape of the major orebody over 200m of the pit in 50m Sections. The ore coalesces between 225-375m RL
and grade increases in this area.
EQ Resources Limited Annual Report 2024 25
Structure of the Ore Body
Structure has always been considered a significant factor in the mining process at Mt Carbine, influencing both
ore body dislocation and pit wall stability. Over the past 12 months, it has become evident that the dominant
structural feature in the pit is the Christmas Fault, which has destroyed approximately 15 meters of the ore body in
the western part of the pit. This early fault is believed to have acted as a barrier to quartz mineralisation, causing
quartz veins to accumulate against the fault without extending into it. However, these veins reappear on the other
side of the fault in their expected locations.
Left: Major structural components causing ore body configuration (Jogs); Right: Recent drilling before blasting on 365-355m RL levels.
Operating and Financial Review continued
26
EQ Resources Limited Annual Report 2024
Open Pit Operations
Open pit mining operations commenced at level 325m RL in June 2023 following the execution of a Mining Services
Agreement with Brisbane-based Golding Contractors Pty Ltd (“Golding”) and conducted using conventional
methods, employing a fleet of 6x CAT 775 dump trucks carrying 63 tonnes of material and 2x smaller articulated
Volvo trucks carrying 40 tonnes of material all being loaded by excavators ranging from 50 to 190 tonnes.
Mining is conducted on 10-meter blast benches, with double bench mining carried out using three 3.3-meter
flitches per bench. Two drill and blast rigs perform approximately 22,000 meters of drilling each month, with 4 to 6
blasts taking place, each with a maximum size of 65,000 tonnes. Each blast is limited to 18 tonnes of explosives due
to truck size. The maximum blast size is also limited by noise and vibration restrictions set by the Mines Department
to limit any effects on the nearby community. Early blasting designs established the optimal patterns for noise,
vibration, ore fracture size, spacing, and powder factors. Currently, EQR employs a blast design of 10-meter-deep
holes of 89mm size on a 2.4 x 2.6 meter pattern with approximately 2 meters of stemming.
The pit design features 20-meter walls and 8-meter berms, resulting in a 59-degree engineered slope that has
proven to be highly stable.
Waste material was primarily utilised to construct a noise and visual bund around the eastern end of the pit.
Weathered material was used to line and seal various areas as needed.
EQR opted for a slower startup phase than initially planned in the BFS, primarily due to recruitment challenges and
the need to establish base costs for contractors on a cost-plus basis, with a ramp up following the startup phase
to a monthly target of 300,000 tonnes ore + waste.
EQ Resources Limited Annual Report 2024 27
During the first quarter FY2024, 2x 50 tonnes excavators were utilised, until a larger Hitachi 1900 excavator
arriving in October 2023 was commissioned. The excavator weighs 190 tonnes and has a 11m3 bucket significantly
enhancing the efficiency of the Open Pit mining operations from the second quarter. Alongside this, the technical
service team updated the production schedule to accommodate the repositioned pit ramp, optimising ore recovery
for the Stage I Open Pit. In a move to boost haulage capacity, three CAT 745 Moxy dump trucks were replaced
with a fleet of CAT 775F trucks throughout November 2023. Additionally, an extra CAT D10 Dozer was deployed to
assist with auxiliary tasks and material management, further streamlining the mining operations.
Commissioning was completed across several key
areas to enhance the mining operations. This included
optimising blast designs with ideal pattern spacing,
bench heights, powder factors, and adherence to
established noise and vibration limits. The Company
focussed on selecting the most suitable equipment for
mining ore and waste, as outlined in the BFS, which
recommended smaller units for ore mining and larger
ones for stripping operations. Other significant areas
of focus included optimising cycle times, designing the
ROM ore pad, assessing pit wall slopes to ensure the
stability of the South Wall Fault during cutbacks, and
training staff on new equipment usage. Additionally,
comprehensive water management plans and clarified
roles and responsibilities between Goldings, and EQR
staff to streamline operations and enhance safety and
efficiency were implemented.
Cyclone Jasper
The site was hit by Tropical Cyclone Jasper mid-
December 2023 with the operations losing 20
production shifts as floods cut roads and power,
disrupting the entire region’s logistics, fuel deliveries
and concentrate pick-ups.
Tropical Cyclone Jasper significantly affected operations at the Mt Carbine Site mid-December 2023 with damaging winds, floods,
power outages, disrupted logistics, causing 10 days of downtime.
Operating and Financial Review continued
28
EQ Resources Limited Annual Report 2024
Thorough preparation and a swift response to Tropical Cyclone Jasper played a pivotal role in minimising risks and
reducing damage at the Mt Carbine site. Despite confronting extreme winds, unprecedented rainfall, floods, and
power disruptions, our proactive measures and quick actions limited cyclone-related downtime to just 10 days.
This rapid recovery demonstrated the resilience of the team at Mt Carbine and the robustness of the operations
under severe weather conditions. While production targets were impacted by flooded roads that restricted site
access, new policies were implemented and temporary accommodations for staff were organised to ensure full
operational hours as best as possible and to maintain safety as a priority.
Left: Open Pit on the 1st of January; Right: Open Pit at the end of February.
Cyclone Jasper was the wettest tropical cyclone in Australian history, with an estimated cost of $1 billion for the
Cairns region. The pit filled up with nearly 1.5 millions litres of water, making access to good grade ore impossible
until complete dewatering. The drilling, blasting and mining operations were moved to the top level to continue
stripping while the pumps were emptying the pit 24/7. The wet season was prolonged this year which meant the
dewatering was not completed until the 25th of February.
-
5,000
10,000
15,000
20,000
25,000
-
50,000
100,000
150,000
200,000
250,000
300,000
Q1
FY24
Q2
FY24
Q3
FY24
Q4
FY24
mtus
Tonnes
Mt Carbine Mine Performance FY2024
Ore Extracted
Tungsten Produced* - Gravity Plant (mtu)
Ore (Monthly t)
* 50% EQR 50% Cronimet.
EQ Resources Limited Annual Report 2024 29
Johnson veins showing up in the pit – looking at blast # 305-002 wall. Individual vein’s look high by visual inspection with the entire face
being 0.28% WO3 in this region.
After conducting an internal review, the principal engineers and environmental consultants have endorsed an
expansion of the original noise and visual bund design, scheduled for the second half of FY2024. This expansion
will extend the Bund further north around the edge of the open pit, facilitating proactive seeding and rehabilitation
of the area. The scope of the extension has more than doubled the material requirements for construction.
The Mt Carbine team is committed to utilising the waste material for this purpose, and the bund is currently
approaching 30% completion of this significant capital project.
At the end of June 2024, the underground portal of the existing 430-meter decline from the 1980s was uncovered,
a significant milestone in EQR’s exploration efforts for underground potential. The next step will be to pump
the water out and conduct geotechnical surveys and assessments, planned for early FY 2025, ahead of the
underground drilling campaign and feasibility study.
Entrance of the existing decline reopened June 2024.
Operating and Financial Review continued
30
EQ Resources Limited Annual Report 2024
Subsequent to the end of the FY2024, after 14 months of mining at cost-plus basis, the mining operations at
Mt Carbine are transitioning to an owner-operator model. The owner-operator model will result in cost savings,
operational control and mining flexibility while upskilling the local workforce. A 90-tonne Cat Excavator was
commissioned in early September to replace the Hitachi 190-tonne excavator, and the operations have moved to
a 24h per day mining roster, from the previous 12h per day. This increases tonnes moved monthly, reduces overall
unit costs and provides earlier access to the higher grade vein packages. A comprehensive rollout plan is ongoing,
with key machinery already delivered and additional equipment arriving as scheduled. New and leased equipment
has been mobilised on-site, ensuring a smooth transition.
See ASX Announcement 16th August 2024: “Mt Carbine Mine transition to owner-operator mining.
Reserve & Resource Statement
The last published MRE (Mineral Resource Estimate) for the Company was from the Measured Group in May, 2023
(https://www.eqresources.com.au/site/pdf/5b25d6d9-cd6c-4b61-a01b-177baa3da4b2/64-Increase-of-Mt-
Carbine-Indicated-Resources-InSitu.pdf). The Resource and Reserves have subsequently been updated in June
2024 based on the mining activity completed since the May 2023 statement.
In total, 2,157,155 tonnes of material were mined over the 12 month period and 760,000 tonnes of ore sent for
processing at a waste-ore strip ratio of 2.84:1. This ore yielded 1,395 tonnes of concentrate at 50% WO3 grade after
processing. Approximately 360 tonnes of further concentrate remained in untreated oversize and on the ROM pads.
Depletion over the past 12 months due to mining was 1.8% of the total Resources and 12.8% of Current Reserves,
as per the table below.
Orebody
Resource
Classification
Tonnes
(Mt)
Grade
(% WO3)
WO3
(mtu)
Low-Grade Stockpile
Indicated
10.13
0.075%
759,450
Indicated
2.57
0.070%
166,832
Inferred
0.83
0.060%
53,789
Subtotal
13.53
0.070%
980,071
In-Situ
Indicated
17.49
0.30%
5,235,286
Inferred
10.68
0.30%
3,217,311
Subtotal
28.17
0.30%
8,452,597
All
Total
41.70
0.23%
9,432,668
Mt Carbine Ore Resources Estimate at 30th June 2024.*
Reserve Category
ROM Tonnes (Mt)
WO3 (%)
Contained WO3 (mtu)
Open Cut - Proven
–
–
–
Open Cut - Probable
5.36
0.28%
1,500,800
Open Cut - Total
5.36
0.28%
1,500,800
LGSP - Proven
–
–
–
LGSP - Probable
9.77
0.075%
732,750
LGSP - Total
9.77
0.075%
732,750
All - Total
15.13
0.148%
2,233,550
Mt Carbine Ore Reserve Estimate at 30th June 2024.
NOTES:
•
Total estimates are rounded to reflect confidence and resource categorisation.
•
Classification of Mineral Resources incorporates the terms and definitions from the Australasian Code for Reporting Exploration Results,
Mineral Resources and Ore Reserves (JORC Code, 2012) published by the Joint Ore Reserve Committee (JORC).
•
No uppercut was applied to individual assays for this resource, a lower cut of 0.05% was applied within the section 0.06-0.08% WO3
being designated as lower grade In-Situ. This is the grade where District Zones of mineralisation occur.
•
Drilling used in this methodology was all diamond drilling with 1/2 core sent according to geological intervals to Australian Laboratory
Services (“ALS”) for XRF15b analysis.
•
Resource estimation was completed using the Kriging Methodology.
•
Indicated spacing is approximately 30m x 30m; Inferred is approximately 60m x 60m.
EQ Resources Limited Annual Report 2024
31
Mineral Resources and Ore Reserves
Mineral Resources and Ore Reserves are estimates of mineralisation that have reasonable prospects for eventual
economic extraction in the future, as defined by the 2012 Edition of the Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves (“JORC Code”). JORC Code compliant statements relating to EQR’s Ore
Reserves and Mineral Resources are estimates only. An estimate is an expression of judgement based on knowledge,
experience and industry practice. Estimates which were valid when originally calculated may alter significantly when
new information or techniques become available. In addition, by their very nature, Resource Estimates are imprecise
and depend to some extent on interpretations, which may prove to be inaccurate. As further information becomes
available through additional fieldwork and analysis, the estimates are likely to change and may be updated from time
to time. This may result in alterations to mining plans or changes to the quality or quantity of EQR’s Ore Reserves and
Mineral Resources, which may, in turn, adversely or favourably affect EQR’s operations.
Mineral production involves risks, which even a combination of experience, knowledge and careful evaluation may
not be able to adequately mitigate. No assurance can be given that the anticipated tonnages or grade of minerals will
be achieved during production or that the indicated level of recovery rates will be realised. Additionally, material price
fluctuations, as well as increased production and operating costs or reduced recovery rates, may render any potential
Mineral Resources or Reserves containing relatively lower grades uneconomic or less economic than anticipated, and
may ultimately result in a restatement of such Resource or Reserve. This in turn could impact the life of mine plan and
therefore the value attributable to mineral inventory and/or the assessment of recoverable amount of EQR’s assets
and/or depreciation expense. Moreover, short term operating factors relating to such potential mineral Resources
or Reserves, such as the need for sequential development of mineral bodies and the processing of new or different
mineral types or grades, may cause a mining operation to be unprofitable in any particular period. In any of these
events, a loss of revenue or profit may be caused due to the lower than expected production or ongoing unplanned
capital expenditure in order to meet production targets, or the higher than expected operating costs.
EQR seeks to manage and minimise this risk through its existing risk management framework including an external
audit process for its Mineral Resources and Ore Reserves.
Throughout the year, a total of 273 Reverse Circulation (RC) Grade Control drill holes were completed, covering 9,165
meters. The drill hole depths ranged from 33 to 51 meters. The majority of these were in-pit grade control holes, with
the exception of 43 holes (2,184 meters) drilled outside the pit. These exploratory holes included 26 holes drilled to a
depth of 50 meters at the Ruby Vein prospect and 17 sterilisation holes.
The mine staff continuously validates the resource estimate by reconciling actual production against the feasibility
model. This ongoing reconciliation process has underscored the critical role of drill hole data density as the pit
deepens. During the first six months, reconciliation was poor (56%), primarily due to a lack of diamond drilling in the
upper portion of the pit, where reserves could only be estimated at Possible Reserves. However, after completing
close-spaced grade control drilling, a strong correlation between production and the model was achieved. In the
second six months, reconciliation against the BFS Model improved significantly, where diamond drill spacing had
reduced to approximately 30-meter centers and mining advanced into the main ore body. This resulted in an excellent
match between actual production and the feasibility model with reconciliation reaching 97%.
Going forward, EQR sees no reason to alter the current Reserve model as mining is entering the well drilled out main
ore body. It is necessary that the detailed 10 x 10m spaced RC be continued as it clearly outlines the vein zones on a
blast by blast basis.
Operating and Financial Review continued
32
EQ Resources Limited Annual Report 2024
EQ Resources Limited Annual Report 2024 33
Processing
Crushing Operations
In the first month of FY2024, the Mt Carbine Mine undertook a strategic shift, transitioning from re-processing
low-grade, historical stockpiles to focusing predominantly on extracting and processing tungsten-rich ore from
open pit operations. This shift not only represents a move towards more efficient mining practices but also
opens up new economic opportunities and possibilities for sustainable growth. Since initiating open cut mining,
the operations team has diligently worked on optimising the Ore Sorter Plant to accommodate to the new ore,
significantly enhancing the recovery rates. This improvement has led to a higher-grade feed into the Gravity Plant,
markedly increasing production volumes. Introducing primary ore from the open pit operations has exceeded
initial expectations in tungsten recovery rates, reinforcing strong production trends.
The Crushing Plant at dusk at Mt Carbine with its vibrating screen in the foreground and cone crusher in the background.
The feed through the Crushing Plant from the open pit averaged 0.16% WO3 over the last 12 months, climbing over
0.24% WO3 in June 2024 when processing the ore blocks at the bottom of the pit Level 295-285m RL, in contrast
to the 0.074% WO3 average from the Low-Grade Stockpile (“LGS”). The focus was on processing high-grade ore
first, then transitioning to medium-grade ore, using the best available material from a combination of stockpiled
ore from the Open Pit and fresh ore deliveries.
This relatively low-grade feed mix from Stage I Open Pit is expected to improve in the months ahead, i.e. once
entering Stage II Open Pit as the mining operations will dig deeper into the vein systems. For comparison, the
average LOM grade as per the Mt Carbine Ore Reserves is expected at 0.28% WO3 - significantly higher in grade
compared to the average ore grade mined during the first year.
To accommodate the increased grade, the team had to adapt the plant and crushing operations to handle the
new material being delivered. The first blasts produced larger-than-expected oversized material due to certain
drill holes not blasting as expected and higher-than-planned dilution, resulting in a lower grade than anticipated.
Blasting and dilution controls have since been implemented, leading to more consistent grades reaching the
stockpile and processing plant as blasting continued month-by-month.
Significant upgrades have been made to the crushing circuit to improve efficiency and throughput as part of
ongoing efforts to optimise mining operations at the Mt Carbine Mine. In July 2023, a Terex Finlay Mobile Jaw
Crusher J-1175 was integrated into the production process as the primary crusher, reducing oversized -700mm ore
from the Open Pit to a more manageable -170mm fraction for the Crushing Plant. This significantly lowered the
amount of oversized material that would have otherwise been rejected. The primary crushing step is crucial, as it
prepares the feed by nearly eliminating all oversized materials, preventing potential blockages, bottlenecks, and
increasing availability at the fixed crushing plant.
Operating and Financial Review continued
34
EQ Resources Limited Annual Report 2024
Kobelco 50 tonne excavator feeds the newly commissioned Terex Finlay Jaw Crusher J-1175 before the CAT 980M Front End Loader
transports the feed to ROM1 Stockpile for the Crushing Plant.
In October 2023, the main Sandvik Circular Motion Screen was taken offline for reconditioning at the site workshop.
During this downtime, a Sandvik Mobile Cone Crusher QH332, along with a Sandvik 696 Mobile Screen, was
commissioned to maintain crushing operations, producing feed for the XRT Ore Sorters and the Gravity Plant.
After the screen was refurbished, the fixed plant resumed its priority role for crushing, with the mobile equipment
used in tandem to increase output and build stockpiles for the XRT Ore Sorters and Gravity Plant.
Additionally, the Cone Crusher proved versatile, capable of reducing the high-grade ore from the Ore Sorter Plant
from 40mm to 6mm for the Gravity Plant, especially useful during preventative maintenance of the Gravity Plant’s
own Cone Crusher. This setup not only boosts overall output but also enhances availability for both plants.
In April 2024, a Terex Finlay 893 Scalper was commissioned to provide additional feed for the Crushing Plant,
delivering 75mm material from the LGS to the ore sorter plant, while the -6mm fines are fed directly to the Gravity
Plant for additional metal recovery.
The Terex Finlay 893 Scalper on commissioning day in April 2024.
EQ Resources Limited Annual Report 2024 35
During FY2024, the Crushing Plant processed 642,666 tonnes of Open Pit material, 9,333 tonnes of historic LGS
material, produced 488,979 tonnes of Ore Sorter Plant feed for sorting, and 153,687 tonnes of fines material for
the Gravity Plant.
The operations are set to undergo significant transformational changes in the upcoming financial year, with the
processing plants doubling their throughput. Most of the major equipment, ancillary structures, and supporting
equipment from Sandvik for the Crushing Plant have been received on site with commissioning expected to start Q2
FY2025. The Queensland Critical Minerals and Battery Technology Fund has agreed to establish a A$20 million 3-year
loan facility, including Tranche 1 of A$12m to double crushing capacity at to 2mtpa.
See ASX Announcement 20th March 2024: ‘Mt Carbine receives additional equipment for doubling of throughput capacity’.
XRT Ore Sorter Plant
With the commencement of Open Pit ore deliveries, the operations have experienced a higher proportion of
material in the sortable fraction, which is an overall benefit to the operation due to the low-cost nature of XRT Ore
Sorting. Using the experience acquired while operating and sorting the LGS material, processing the primary ore
from the Stage I Open Pit has increased mass yields ranging between 15-18%, with stable WO3 recoveries.
Operating and Financial Review continued
36
EQ Resources Limited Annual Report 2024
Commissioning of the Tomra XRT Ore Sorter # 3 was finalised at the end of July 2023. It will replace the older model
Tomra XRT Ore Sorter # 1, which will be refurbished. Boasting newer programming and increased efficiencies, the
plant is already seeing the benefits of the upgrade, with an increased run time from around 50% in previous months
to 74% in September.
The Ore Sorter Plant has received another upgrade ahead of schedule, with significant upgrades to the software and
ejection module of Tomra XRT Ore Sorter #2 currently in operation. These upgrades aim to increase the product
grade and decrease by 75% the amount of air needed for the operation, saving a considerable amount of power. The
benefit of this has been seen as a lower yield but a higher grade, optimising further downstream crushing.
In the next financial year, the Tomra XRT Ore Sorter # 3 will also receive an upgrade of the ejection module, and the
Ore Sorter Plant will benefit from the addition of a new Tomra XRT Ore Sorter #4. This will bring the total number
of units operating to three and further reduce the risk of bottlenecking when the Crushing Plant Phase 2, with
double the throughput, comes online.
See ASX Announcement 11th April 2024: ‘Mt Carbine hits quarterly production record with XRT Sorter expansion well
underway.’
Inside TOMRA Ore Sorter #2 showing the valve bank (left) and the end of the conveyor belt where the material gets ejected (right).
Ore Sorter Strategy Proves Correct
EQR’s strategic mine selection at Mt Carbine focuses on mining highly sortable ore to maximise efficiency and
sustainability. Adopting ore sorting technology has enabled EQR to significantly enhance its operational efficiency
by concentrating approximately 500,000 tonnes of crushed ore, sized 6-40mm, into 50,000 tonnes of high-grade
ore. This high-grade ore retains 95% of the metal units and is directly fed into the Gravity Plant. By doing so, the
Company avoids the unnecessary further crushing of 90% of the ore in this size fraction, which is predominantly
barren. This not only reduces the initial need for a larger Gravity Plant but also reduces operational costs associated
with energy, wear-and-tear on equipment, and minimises double-handling of materials and the need for additional
equipment and labour. Additionally, reducing processing volume significantly decreases energy consumption and
lowers greenhouse gas emissions, aligning with EQR’s commitment to sustainable mining practices and reducing
the overall environmental impact.
EQ Resources Limited Annual Report 2024 37
Operating and Financial Review continued
Ore Sorter Strategy Proves Correct
EQR’s strategic mine selection at Mt Carbine focuses on mining highly sortable ore to maximise
efficiency and sustainability. Adopting ore sorting technology has enabled EQR to significantly
enhance its operational efficiency by concentrating approximately 500,000 tonnes of crushed ore,
sized 6-40mm, into 50,000 tonnes of high-grade ore. This high-grade ore retains 95% of the metal
units and is directly fed into the Gravity Plant. By doing so, the Company avoids the unnecessary
further crushing of 90% of the ore in this size fraction, which is predominantly barren. This not only
reduces the initial need for a larger Gravity Plant but also reduces operational costs associated with
energy, wear-and-tear on equipment, and minimises double-handling of materials and the need for
additional equipment and labour. Additionally, reducing processing volume significantly decreases
energy consumption and lowers greenhouse gas emissions, aligning with EQR’s commitment to
sustainable mining practices and reducing the overall environmental impact.
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
Crushing Plant
Sorter Plant (6-40mm)
Gravity Plant
to XRT Sorter
unsorted to Gravity Plant
Quarry Product (Inventory)
90%
10%
68% of crushed ore is barren
32% of crushed Tungsten-bearing
ore is fed to the Gravity Plant
Additional tailings reprocessed (green)
Sorter Product (10% in orange) contains
~55% of total mtus recovered
38
EQ Resources Limited Annual Report 2024
EQ Resources Limited Annual Report 2024 39
Gravity Plant
The Gravity processing operations at the site have successfully transitioned from primarily processing material
from the LGS at 0.0745% WO3, based on historic assays, to processing tungsten-rich ore at 0.15 - 0.22% WO3
sourced from open pit operations and has led to significant positive outcomes.
The operations team has effectively enhanced the performance of the Ore Sorter Plant and the recovery rates of
ore processed through the Gravity Plant, resulting in a higher-grade feed to the plant and a substantial increase in
concentrate production.
The high-grade Ore Sorter Product processed at the Gravity Plant through the High-Grade circuit increased from
3,000 tonnes monthly average for FY2023 to 4,000 tonnes monthly average for FY2024, greatly increasing the
Gravity Plant’s feed grade.
The High-Grade Crushing Circuit at the Gravity Plant.
Operating and Financial Review continued
40
EQ Resources Limited Annual Report 2024
0.13
0.37
0.41
0.47
0.46
-
0.10
0.20
0.30
0.40
0.50
0.60
0.70
0.80
0.90
1.00
-
5,000
10,000
15,000
20,000
25,000
Q4 FY23*
Q1 FY24
Q2 FY24
Q3 FY24
Q4 FY24
%WO3
mtus
Mt Carbine Quarterly Production**
& Gravity Plant Feed Grade
Tungsten Produced (mtu)
Gravity Plant Feed Grade
77%
78%
79%
80%
81%
82%
83%
84%
Q1 FY24
Q2 FY24
Q3 FY24
Q4 FY24
Mt Carbine Gravity Plant Recovery (%)
Gravity Plant Recovery
Linear (Gravity Plant Recovery)
*
for illustration purposes to compare before versus after processing Open Pit ore
** 50% EQR 50% Cronimet
The quarterly average fee grade in the Gravity Plant improved from 0.12% WO3 in FY2023 to 0.37% WO3 for
FY2024, thanks to the combination of a higher overall Head Feed grade processed in the Crushing Plant and an
increase in the volume of Ore Sorter Product processed.
The Phase 2 expansion continues to progress across the site, with significant developments at the Gravity Plant. A
new mineral jig has been commissioned and installed in series with the existing jig for a boost in recovery. So far,
the recovery has seen an overall increase of ~10%. The plant has received a second motor control centre, necessary
for doubling plant capacity, that will be commissioned in late 2024.
The Gravity Plant has maintained excellent operational metrics, achieving 93% availability and 82.2% run time.
Fine ore being screened in a vibrating screen with new self-cleaning panels, ahead of the Mineral Jig at the Gravity Plant.
EQ Resources Limited Annual Report 2024
41
Laboratory activities
The newly established laboratory has been efficiently assaying samples from the open pit and various processing
plants, providing quick turnaround times for results. This enables the team to better understand the new material
being processed, assess different grades, and optimise the processing circuits accordingly.
The lab efficiently processes samples daily, with a well-distributed labour force ensuring timely completion of tasks
like crushing, splitting, pulverising, and assaying. Quality control measures, including both internal and external
checks, were maintained to ensure reliable results. The lab successfully implemented a 24-hour turnaround for
results, significantly improving the understanding of the plant’s efficiency.
This year, the laboratory team achieved concentrate results within 1% of those from Australian Laboratory Service
(“ALS”) and Massan. Established quality control measures and procedures, including 20% internal and 10% external
quality checks via ALS. Expanded operational capacity to process up to 100 samples daily when fully staffed. The
team is currently building the capacity to process drill core and conduct multi-element assaying on soil samples
into the current workflow, which is expected to enhance versatility from the X-Ray Fluorescence spectrometer
(“XRF”) and provide more comprehensive results and insights for exploration leases without sending samples to
ALS for analysis.
The newly established laboratory shed before all equipment and shelving was put into place.
The collaboration with the Barruecopardo laboratory in Spain has greatly improved the overall knowledge base and
the management of information. Moving forward, the Company is working on a combined Laboratory Information
Management System between both operations for ease of access to results through a central database.
Operating and Financial Review continued
42
EQ Resources Limited Annual Report 2024
Quarry Operations
After good sales from the continued relationship with Boral Asphalt reseal projects in the first half of the year, the
prolonged wet season limited the extent of infrastructure projects that could progress.
Culminating in Cyclone Jasper in December, and the crippling flooding that affected the Far North Queensland
region thereafter, the quarry team was pleased to be the only quarry in the district that did not spend many weeks
underwater!
This did result in vital emergency repairs being able to be supplied with material to open local roads to the stranded
public, whether by supply to councils or supply to other quarries. Significant landslips occurred during this event
and some locations have been in caretaker mode until plans for rehabilitation have gone through process. Disaster
Recovery Funding is now filtering through to local councils and enabling local roads projects to come to the fore.
Mt Carbine Quarry is currently supplying to the restructuring of the Alexander Range north of the Daintree River
which commenced in June 2024 and has continued through July and August, and have provided material tenders
for the Captain Cook Highway Jasper Landslip Project (yet to be awarded).
Aligned with the Queensland Government strategy of repurposing waste rock from mining projects, the Mt
Carbine operations beneficially re-uses clean mine waste to make a diverse array of products, including road
bases, drainage aggregates, bituminous sealing aggregates, and robust armour rock to name only a few.
The increased mine & blast operations of the past year have not only increased tungsten production but has also
given greater opportunity for extraction of the large armour rocks required for slope stabilisation, as well as rock
fill for Gabion Walls and Mattresses.
EQ Resources Limited Annual Report 2024 43
Tenement Interests
In accordance with ASX Listing Rule 5.3.3, the following table is submitted with respect to tenements held by the
Company and its controlled entities:
Location
Holding Entity
Beneficial
Interest
Interest
Acquired or
Disposed
Area
Expiry date
Queensland, Australia
ML 4867
Mt Carbine Quarries Pty Ltd
100%
28/06/2019
358.5 ha
31/07/2041
ML 4919
Mt Carbine Quarries Pty Ltd
100%
28/06/2019
7.891 ha
31/08/2041
EPM 14871
EQ Resources Limited
100%
12/12/2005
10 sub-blocks
12/12/2025
EPM 14872
EQ Resources Limited
100%
11/12/2005
21 sub-blocks
11/12/2025
EPM 27394
EQ Resources Limited
100%
01/06/2020
4 sub-blocks
1/06/2025
EPM 28898
EQ Resources Limited
100%
17/06/2024
147 sub-blocks
17/06/2029
New South Wales, Australia
EL 6648
EQ Resources Limited
100%
N/A
4 Units
19/10/2026 1)
EL 8024
EQ Resources Limited
100%
N/A
19 Units
29/11/2024 1)
ML = Mining Lease; EPM = Exploration Permit for Mineral (Qld); EL = Exploration License (NSW)
1) Sozo Farm-in arrangement.
ML4867 & ML4919 were renewed for a further 19 years during the reporting period (More information see: ASX
Announcement 24th March 2023: ‘Mt Carbine Mining lease renewed for 19 Years’). This renewal included a new
landowner agreement with Australian Wildlife Conservatory (AWC) and a submission of an initial Mine Plan for the
first 5 years of mining.
Operating and Financial Review continued
44
EQ Resources Limited Annual Report 2024
Australian Regional Exploration
Brownfields - Ruby Vein Outline
Located 150 meters north of the planned open cut at Mt Carbine, the Ruby Veins outcrop at an elevation of
430-460m RL at the top of Mt Carbine. Historically, these veins were partially mined by artisanal miners and
appeared as three narrow veins, 5-10 cm wide, displaying good wolframite mineralisation in certain areas. A shallow
investigative RC drilling program targeted the top 30 meters of the veins to explore for wider zones. The drilling
revealed vein zones with widths of 1-2 meters and grades of up to 1.2% WO3, which is considered significant at the
480m RL level. Compared to the nearby, well-drilled Johnson Vein, where the main mineralised zone occurs at
250-275m RL, hitting such grades at this higher level is regarded as an important discovery by the geology team.
Ruby Vein section & plan showing thin veins at high level in the system. Shallow 50-meter holes hit 12 meters of grades up to 1.2% WO3.
EQ Resources Limited Annual Report 2024 45
Wolfram Camp Mine Exploration Permit – EPM 28898
EQR has been awarded the EPM for resource exploration at the historic Wolfram Camp mine site to determine
the feasibility of re-commissioning. This aligns with the Queensland Government’s plan to invest A$245 million
in the Critical Minerals Strategy, emphasising the re-commercialisation of old mines for economic growth and
a sustainable future. The permit encompasses a 477km2 RA442 license area within the Herberton Tin-Tungsten
field and offers immense potential. Approximately 5 million tonnes of Low-Grade Stockpile and tailings are readily
available for evaluation. The 5-year program includes drilling over 10,000 meters in the next 3 years and collecting
4,000 soil samples as well as completing a pre-feasibility on selected targets. An XRT Ore Sorter trial will also be
undertaken in FY2025 to evaluate its compatibility with the existing Mt Carbine processes. This initiative supports
EQR’s growth strategy and will further solidify the region’s role as a critical mineral hub due to Wolfram Camp
being located approximately 60km from the Mt Carbine Mine Site.
See ASX Announcement 27th July 2023: ‘EQR Awarded Permit For Historic Wolfram Camp Mine’.
See QLD Government Statement 18th June 2024: “Permit granted to unlock critical minerals and jobs at historic Far
North Queensland mine site”.
Over the past 12 months, the Company has secured environmental and heritage site access approvals.
The Queensland Government has also provided the main camp at the Wolfram mine site, which can now be used
as a base of operations. Currently, two personnel from the geology department are on-site, working through
extensive historical information to ensure it is properly organised into accessible databases.
The main intrusive at the Wolfram Camp prospect is the O’Briens Creek Supersuite. This geological feature is
significant as it represents an older intrusive event compared to the younger “S” type intrusives found at the nearby
Mt Carbine tungsten system. The O’Briens Creek Supersuite is associated with porphyry-style mineralisation and
peripheral vein systems, which are key characteristics of the Wolfram Camp prospect. Previously, the focus was
on the localised identification of ‘greisen’ mineralisation that occurs along the contact, but the current program
is focused on following the higher-grade vein system. Most of the drilling (97%) has been shallow RC drilling,
providing limited geological information and hindering detailed interpretation. Old workings maps from the early
20th century offer valuable insights, indicating that artisanal miners were extracting high-grade veins at depths
exceeding 100 meters below the greisen contact. Given the higher grades of these veins, there is a strong case for
deeper drilling to follow the vein system to greater depths.
Left: Longitudinal section – Wolfram Camp greisen zones and stoped areas; Right: 3D view looking SE – Wolfram Camp Resources
Extensions.
Operating and Financial Review continued
46
EQ Resources Limited Annual Report 2024
At Bamford Hill, there is an extensive breccia pipe that is locally well mineralised, with grades exceeding 0.5%.
Although the size potential has yet to be fully determined, and historical drilling has been limited, mapping suggests
that the breccia pipe extends vertically over 250 meters. Detailed reconnaissance mapping, coupled with Induced
Polarization surveys, is planned for Bamford Hill to enhance understanding of its scale and mineralisation potential.
Orebody
Resource
Classification
Tonnes
(kt)
Grade
(% WO3)
WO3
(mtu)
Greisen
Indicated
442
0.15
66,300
Inferred
1,829
0.15
274,350
Pipe Material
Indicated
77
0.69
53,130
Inferred
602
0.69
415,380
Total
2,950
0.279
823,050
Wolfram Camp Resources. Source: 2015 Technical Report Almonty Industries (NI 43-101)
NSW Exploration Tenements
Sozo Resources has successfully completed the Stage 1 Farm-In Conditions and has chosen to proceed to Stage 2 of
the Farm-In. This decision grants Sozo the exclusive right to acquire a 49% legal and beneficial interest in the
Joint Venture gold property. To secure this interest, Sozo must invest $750,000 in exploration activities, with the
expenditure deadline set for August 3rd, 2024.
Panama Hat
At the Telephone Gold Prospect, recent drilling efforts included 7 RC holes and 7 AC holes, aiming to test gold
mineralisation along NW-SE striking structures and a satellite soil anomaly. While the drilling confirmed the
presence of these structures, the gold assays were modest, with the best result being 2 meters at 0.59 g/t Au. The
anticipated shallow gold oxide resource was not found, leading to a shift in exploration focus.
The AC drilling, which targeted a soil anomaly, also yielded disappointing results with the highest gold assay at
40ppb. The absence of arsenic, a common gold pathfinder, suggested the anomaly might be transported rather
than in situ. Consequently, further drilling at the Telephone Line Prospect was deemed unjustified, redirecting
exploration efforts to the Panama Hat and Willyong Tank Prospects.
At the Panama Hat Prospect, a newly interpreted NW-SE linking structure between major shear zones has been
identified as a promising exploration target. Future efforts will focus on these structural intersections, building on
insights from previous drilling campaigns.
EQ Resources Limited Annual Report 2024 47
Crow Mountain
Additionally, flooding and permit delays postponed fieldwork, causing Sozo to miss initial deadlines. To address
this, Sozo was granted an 18-month extension to complete the agreement terms, including meeting the minimum
expenditure requirements, ensuring the project stays on track.
Plan view image showing Telephone Line Reverse Circulation and Air Core drilling program at Panama Hat Project, with down hole gold
assays (ppm).
Operating and Financial Review continued
48
EQ Resources Limited Annual Report 2024
Saloro/Barruecopardo Operations
Operating and Financial Review continued
125
employees, 200 direct jobs
created with contractors
24%
women employees
786
people have visited
the mine in FY 2024
141
training courses
provided
SALORO
maintains ISO 14001 (Environment) and
45001 (Safety and Health) certifications
100%
permanent contract
25,113
alcohol tests conducted,
402 drug tests
1,329,792
tonnes of ore mined
184
number of blasts in FY2024
33,729
number of holes drilled
1,743
tonnes of explosives used
in FY 2024
6,259,947
tonnes of waste mined
242.034
kilometres drilled
HR:
PRODUCTION:
EQ Resources Limited Annual Report 2024 49
Health and Safety
The acquisition of Saloro by EQR initiated the integration of the Health and Safety (HSE) departments of both
companies, sharing the high safety standards that EQR had implemented in its Mt Carbine operations.
During the second half of FY2024, coinciding with the arrival of EQR, a great effort has been made for Saloro
and EQR to share work procedures, knowledge and collaboration in safety matters with regular workshops and
meetings between HSE departments to share best practises and safety procedures.
Saloro has continued with its policy of alcohol and drug controls, a procedure established since the beginning
of the construction work and commissioning of the facilities. All workers support this initiative, aware that the
Company must guarantee the safety of its employees and offer to its staff optimal working conditions. During
FY2024 a total of 25,113 alcohol tests and 402 drug tests were conducted.
Saloro has diligently maintained compliance with mining sector regulations by conducting mandatory training.
Workers were keen to upskill, undertaking additional courses designed to enhance responsiveness to various
workplace risks. In FY2024, the Company placed a special emphasis on training the workforce regarding the
hazards associated with respirable silica, in response to the recent important regulatory updates. To effectively
implement this training, the Company engaged external companies and undertook detailed organisation of the
courses, ensuring the team is both well-prepared and compliant with the latest safety standards. The following
training has been conducted:
−
26 Initial mining training
−
41 Respirable Crystalline Silica (theory)
−
35 Respirable Crystalline Silica (Practise)
−
17 First Aid Course
−
20 Safety in Mining
−
2 Chemical product training
−
Site wide training for the use of Automatic Defibrillator (AED)
Saloro conducts comprehensive control activities to mitigate risks associated with its operations. This includes
performing at least three annual measurements of silica content in the respirable dust fraction, along with the
installation of irrigation and dust collection systems at critical points. Additionally, timely training is provided to
workers, and personal protective equipment (PPE) is distributed and monitored to ensure proper use for each
specific job.
Furthermore, routine checks are conducted on the environmental conditions within the workplace, covering aspects
such as noise, vibrations, lighting, and radiation. Safety equipment, including first aid kits, fire extinguishers, fall
arrest harnesses, and ladders, is also inspected monthly to maintain high safety standards.
Open Cut Mining Operations
During this fiscal year, the mining operations faced a variety of challenges, each presenting unique obstacles but
also opportunities for growth and improvement. Through strategic management and the dedicated efforts of the
team, the team at Saloro have successfully navigated these challenges, ensuring continued operational success
and resilience. Below, are the details of the most significant events of 2024 that have shaped the operations,
highlighting the achievements and the proactive steps taken to enhance productivity and sustainability.
Extension of the contract with mining operator Peal Hispania
Since September 2020, PEAL Hispania has been a key partner in production work at the Barruecopardo mine. The
recent two-year extension of their contract, valid through September 2025, underscores the enduring commitment
of PEAL Hispania to the project at Barruecopardo. This long-standing relationship provides stability and continuous
improvement in the operations, reflecting a mutual dedication to the success and growth of the mine.
Rainiest year in the mine area since 2019
While this has been the rainiest year since 2019, the project has proven to be well-prepared to handle these
conditions.
Operating and Financial Review continued
Saloro/Barruecopardo Operations
50
EQ Resources Limited Annual Report 2024
141
tonnes of ore mined
3
Measurements of Respirable
Silica per year
2
Safety meetings per week
25,515
Fit To Work tests conducted
PROACTIVE SAFETY INDICATORS
EQ Resources Limited Annual Report 2024
51
In addition to the capacity of the dams distributed across the mine site, during the dry season, work was carried out
to evaporate water from the dams, with the implementation of vegetation irrigation systems and dust suppression
systems on mine roads and in the processing plant areas. Additionally, mining operations extended deeper into
the pit to construct a sump. This development allowed excess water to be directed and collected in a designated
control area, from where it could be pumped out. This measure prevented the water from interfering with other
mining activities. Finally, to enhance water consumption and evaporation systems, progress was made on the
construction of the next phases of the project.
Irrigation and evaporation systems in operation on the Barruecopardo site.
The process has been initiated to request an increase in the allowed discharge volume of water from the main dam
from the local environmental water authority to enhance flexibility in water management during the rainy season.
Eastern Slope Stability Improvement
Following the analysis of geotechnical data collected in the area with potential instability, a decision was made
to execute a pushback on the eastern slope. This action was taken to enhance the stability of the slope, thereby
ensuring greater safety for future deep mining operations. The pushback required an additional movement of
655,000 tonnes of material.
Barruecopardo Open Pit pushback works on the eastern slope.
Operating and Financial Review continued
52
EQ Resources Limited Annual Report 2024
First Open Pit in Spain to Use Explosives with In-Situ Sensitisation
With ORICA as the explosive supplier, a first trial of bulk explosives with In-Situ Sensitisation in October 2023 was
conducted. This innovative product not only delivers superior fragmentation quality but also significantly enhances
safety measures. It improves safety protocols during the handling processes involved in blasting operations and
substantially boosts public safety by removing the necessity to transport explosives by road. This development
is a testament to the Company’s commitment to pioneering advancements in mining technology and safety,
emphasising the ongoing efforts to lead the industry in both innovation and operational excellence.
LinkedIn post from Orica and the process of loading and density control of the emulsion.
EQ Resources Limited Annual Report 2024 53
Resources and Reserve Statement
Saloro Resources Estimate
Orebody
Resource Classification
Tonnes (Mt)
Grade (% WO3)
WO3 (mtu)
In-Situ
Measured
8.82
0.19
1,659,959
Indicated
10.27
0.18
1,799,757
Inferred
3.82
0.26
995,555
Total
22.91
0.20
4,455,272
Saloro Barruecopardo Resources as per June 2024, Resources >=0.05% WO3 data from topography June 2024
Preparation of the MRE Report Following the JORC 2012 Code
After completing the exploration drilling campaign, which began in January 2022 and concluded in March 2023,
with a total of 7,423.10 meters of drilling across 22 holes, work commenced on preparing a Mineral Resource
Estimate (MRE) in accordance with the guidelines of the JORC 2012 Code. This resource report was compiled by
Jorg Pohl as the Competent Person.
The conclusions of this report were published by EQR in February 2024. The resource model developed is
moderately conservative, providing a more accurate representation of the observed conditions in the mine.
2023 Resource Block Model, filtered by class and grade.
Project 2035
With the data received from the new resource model and with the aim of obtaining regional government permits
for a future expansion of the waste dump and mine extension, the development of the Project named 2035 has
begun. This project is scheduled to be presented in September 2024. Estimates suggest that the resolution and
subsequent approval of the project could be obtained within 6 to 12 months, i.e., by March or September 2025.
Operating and Financial Review continued
54
EQ Resources Limited Annual Report 2024
For the presentation of this project, a slightly aggressive optimisation has been performed on its inputs to achieve
the largest occupied areas and greatest volumes to be produced.
Left: Current open pit design in purple, waste dump in green; Right: Phase 1 Project 2035, open pit in red and waste dump in purple.
Final design: Project 2035, open pit in red and waste dump in purple.
Continuous Improvement in Grade Control
Given the importance of grade control in the operations at Saloro, daily procedures have been adjusted while
maintaining the QAQC standards, to achieve an increasingly accurate grade control block model. This improved
model will be used for future revisions of the resource model.
EQ Resources Limited Annual Report 2024 55
Thanks to the work carried out by the geology and mining department, the grade control model shows that the
tonnes of ore have increased by 2.2%, mtu have increased by 4.7% and overall grade by 2.5% when compared to
the 2023 resource model.
Continuous Improvement in Dilution Control
Operational dilution control is a key element for Saloro at the Barruecopardo mine. Given the special characteristics
of the deposit, the use of tools to accurately determine mineral movement during the blasting process has been
crucial. However, these tools are always preceded by a geological analysis of the working areas.
Since 2021, the Barruecopardo mine in Salamanca has been using the OREPRO 3D software. This tool allows the
team to determine how the mineral moved during the blasting process once the program’s inputs are entered.
With the results obtained in 2024 using the new resource model, the technical service team observed an operational
dilution of 7.8% compared to the 2023 resource model, which is significantly lower than the 15% from previous
years.
Additionally, tonnes have increased by 8.9%, and mtu has increased by 0.4%, as shown in the table below.
Mine Production and Operations
Production at the mine has remained very stable throughout the year. However, the rainfall during the rainy season
has been a constant monitoring element to prepare for potential issues.
Using the pit centre, which was prepared as a sump during the summer in anticipation of the rainy season,
operations in the northern and southern areas proceeded without any setbacks.
The production figures are shown in the following table:
EQR Saloro Mine Production
Mining
Q1 FY2024
Q2 FY2024
Q3 FY2024
Q4 FY2024
Total
Ore Mined
t
340,744
404,337
248,457
348,596
1,342,134
(HG+LG)
mtu
63,226
64,680
43,008
65,363
236,277
grade
0.186
0.160
0.173
0.188
0.176
Waste Mined (+VLG)
t
2,042,590
2,015,218
1,958,237
1,609,172
7,625,217
20,000
20,500
21,000
21,500
22,000
22,500
23,000
23,500
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
Q3 FY24
Q4 FY24
mtu
Tonnes
Saloro Mine Performance*
Ore Extracted
Tungsten Produced - Gravity Plant (mtu)
* Reporting starting post acquisition January 2024
Operating and Financial Review continued
56
EQ Resources Limited Annual Report 2024
Barruecopardo Open Pit as of end of June 2024.
Black Stork living in harmony with production equipment at the mine.
EQ Resources Limited Annual Report 2024 57
Processing
Timeline of Plant Development & Recovery Optimisation
Q1 FY2024 (July to September 2023):
During the first quarter of FY2024, Saloro’s processing plant achieved notable milestones, demonstrating operational efficiency
and strategic advancements. In July, the plant set a new historical production record, showcasing exceptional operational
performance. The ongoing Recovery Enhancement Plan focused on improving metal recovery rates, yielded a
metal recovery rate of 48%, underscoring the effectiveness of the enhancement strategies.
The commissioning of the Tomra XRT Ore Sorter marked a significant leap in processing efficiency, and by August,
the sorter had transitioned to regular operation, becoming an integral component of the workflow. Concentrate
homogenisation tests were conducted on August 8th to enhance processing consistency, followed by modifications
to the Spiral and table circuits and water adjustments from the primary screen to primary jigs on August 10th.
These changes significantly improved processing efficiency. Additionally, on August 18th, parameters and tonnage
adjustments to the hydrosizer were made, further optimising its performance as part of the ongoing recovery
enhancement strategy.
September saw continued refinement of operations, including a critical consultation with metallurgist Kevin Harney,
who provided expert guidance for metallurgical improvements. Despite a disruption caused by a swing jaw failure
in the jaw crusher, the quarter ended on a high note with significant improvements in jig performance following
modifications to jig meshes on September 20th. Regular monitoring of the rod mill was also initiated, maintaining
an optimal fill level to ensure efficient grinding.
Q2 FY2024 (October to December 2023):
The second quarter of FY2024 was characterised by focused efforts on enhancing plant performance and preparing for future
expansions. In October, a large team from EQ Resources, along with metallurgist consultant Kevin Harney, visited the
mine, focusing on strategies to improve plant performance further. This led to significant improvements in jig
performance and subsequent recovery rates. Key modifications to flow and screen panels on October 10th and
17th, respectively, aimed at optimising processing outcomes, were successfully implemented.
Recognising the need for expanded processing capacity, a purchase order was placed in October for a second
Tomra Ore Sorter, with delivery scheduled for the end of December 2023. November continued the optimisation
trend, with monitoring and enhancement of the jig’s hydraulic circuit beginning on November 2nd. Additionally,
coarse table tailings were recirculated starting November 8th, improving material recovery, and cyclone testing
with AMP commenced on November 13th, exploring further enhancements to the processing circuit. The month
also saw modifications to the spiral circuit and an expansion of jig operations to include eight jigs, aiming to boost
throughput and recovery efficiency.
By the end of December 2023, Saloro’s operations demonstrated marked improvements across various metrics.
The total tonnes crushed reached 711,912, while the total tonnes milled amounted to 533,382, reflecting the
enhanced efficiency and throughput of the plant.
Q3 FY2024 (January to March 2024):
Following the acquisition of Saloro by EQ Resources in January 2024, the Crushing and Ore Sorter Plants witnessed
significant advancements. The most notable change was the installation and commissioning of the second Tomra
XRT Ore Sorter that leverages the experience gained from the Company’s Mt Carbine Operation. Previously,
Saloro’s process setup discarded any ore larger than 6mm post tertiary crushing because its grade, below 0.06%
WO3, was deemed uneconomical for further processing. During its ramp-up phase, the XRT Sorting Plant has
achieved ore grade enhancements of more than 25 times, processing sorter feed with a grade below 0.06% WO3
into a sorter concentrate with a grade between 1.5-2% WO3.
Operating and Financial Review continued
58
EQ Resources Limited Annual Report 2024
Thanks to the superior sorting performance, the XRT Sorting Plant now processes 100% of the stream that was
previously discarded, contributing an additional 26% of material to the downstream Gravity Plant. Furthermore,
a stockpile of over 343,000 tonnes of previously discarded >6mm ore is ready for reprocessing, containing an
estimated 19,894 mtu.
BEFORE
Run of Mine
(Tungsten Ore)
Run of Mine
(Tungsten Ore)
AFTER
Discarded material
(Process waste stockpile <0.06% WO3)
Stockpile of discarded material
(Historical process waste stockpile <0.06% WO3)
Discarded material, permanently lost process waste
XRT Sorting: Ability to process all run of mine material,
as well as valorize historical process waste stockpile
Crushing &
Screening Circuit
Gravity
Plant
XRT Sorting
Plant
>6mm ore
>6mm ore
WO3
Concentrate
Crushing &
Screening Circuit
Gravity
Plant
>6mm ore
>6mm ore
WO3
Concentrate
See ASX Announcement 15th February 2024: ‘Saloro XRT Sorting Performance Update’.
Other work included feed optimisation at the jaw crushing and ROM feeding pad, which led to a remarkable 30%
increase in primary crusher throughput. Trials adjusting the Ore Sorter feed from 20/8mm to 40/8mm sizing
resulted in a substantial 40% increase in mtus, driven primarily by higher throughput rates achievable with larger
rock sizing. However, the corresponding changes to the Ore Sorter circuit were deferred to the second half of the
calendar year to allow further downstream optimisation.
Q4 FY2024 (April to June 2024):
The fourth quarter of FY2024 focused on refining the processing plant’s performance and enhancing recovery
rates. As part of the ongoing recovery improvement program, the jig distribution system was replaced with a
more advanced distributor featuring nine outlets, allowing for more uniform and independent feeding of each
jig chamber. The alumina balls have been changed to a different density, and the deck has had its hole diameter
changed from 7.7 mm to 8.5mm. The spiral circuit was upgraded with new coarse and fine hydrocyclones, achieving
85% efficiency in size classification. The decommissioning of the hydrosizer and adding a clarometer relieved the
thickener, further improving circuit efficiency.
EQ Resources Limited Annual Report 2024 59
Operating and Financial Review continued
60
EQ Resources Limited Annual Report 2024
Introducing a new high-frequency screen for the shaking table feed had the most significant impact on the
circuit’s performance, with classified feed positively influencing recovery rates. Additional improvements around
the flotation circuit were also initiated, with expectations of further lifting recovery at the final product circuit,
particularly within the cleaner shaking tables.
These operational enhancements and strategic improvements have firmly positioned Saloro under EQ Resources’
stewardship for continued success and growth.
5,000
5,500
6,000
6,500
7,000
7,500
8,000
8,500
9,000
9,500
Jan-24
Feb-24
Mar-24
Apr-24
May-24
Jun-24
Jul-24
Aug-24
Saloro Monthly Tungsten Production (mtu)*
* Reporting starting post acquisition January 2024
EQ Resources Limited Annual Report 2024
61
Tenement Interests
In accordance with ASX Listing Rule 5.3.3, the following table is submitted with respect to tenements held by the
Company and its controlled entities:
Location
Holding
Entity
Beneficial
Interest
Interest
Acquired
Area
Expiry date
Granting
Salamanca, Spain
C.E. Barruecopardo, 6.432-10
Saloro,
SLU
100%
18/01/2024
2,100 Ha
1/11/2041
20/11/2014
P.I. Saldeana 1a Fracción, 6.432-11
Saloro,
SLU
100%
18/01/2024
29,300 Ha
13 Aug.*
13/08/2001
P.I. Saldeana 2a Fracción, 6.432-12
Saloro,
SLU
100%
18/01/2024
13 Aug.*
13/08/2001
P.I. Milano, 6.432-20
Saloro,
SLU
100%
18/01/2024
29,000 Ha
13 Aug.*
13/08/2011
P.I. Cortegana, 6.570
Saloro,
SLU
100%
18/01/2024
16,700 Ha
14 Nov.*
14/11/2006
P.I. Almonaster, 6.572
Saloro,
SLU
100%
18/01/2024
4,300 Ha
14 Nov.*
14/11/2006
P.I. Aracena, 6.649
Saloro,
SLU
100%
18/01/2024
5,300 Ha
30 Oct.*
30/10/2008
P.I. Brincones, 6.834
Saloro,
SLU
100%
18/01/2024
6,100 Ha
7 May*
7/05/2013
C.E. = Mining Lease; *P.I. = Exploration Permit which is renewed annually.
Operating and Financial Review continued
62
EQ Resources Limited Annual Report 2024
Material Business Risks
The Board is committed to the identification, assessment and management of risk throughout the Company’s
business activities. The Company’s Risk Management Policy recognises that risk management is an essential
element of good corporate governance and fundamental in achieving its strategic and operational objectives.
Risk management improves decision making, defines opportunities and mitigates material events that may impact
security holder value. The Board reviews the entity’s risk management framework at least annually. Management
reports risks identified to the Board through regular operations reports, and via direct and timely communication
to the Board where and when applicable. The Company does not have an internal audit function. The Company
faces risks inherent to its business, including economic risks, which may materially impact the Company’s ability
to create or preserve value for security holders over the short, medium or long term. The Company has in place
policies and procedures, including a risk management framework, which is developed and updated to help manage
risks. During the reporting period, management reported to the Board on the effectiveness of the company’s
management of its material business risks.
The matters listed below are not listed in order of importance and are not intended to be an exhaustive list of all
the risks and uncertainties affecting the business.
Operational Risks
The Mt Carbine Mine in Australia is subject to various operational risks, including disruptions in operations,
equipment failures, challenges in securing replacement equipment, and issues with product separation and
screening. Since its inception in February 2020, the Mt Carbine site has evolved from a junior exploration entity
into a comprehensive mining operation under the leadership of EQR’s CEO, Kevin MacNeill. With the initiation
of open cut mining in late June 2023, Kevin leveraged his 30 years of experience managing mining operations
across North America, Europe, and Africa. His extensive background has fostered the development of a proactive,
hands-on management style and a streamlined operational team, which emphasises efficient decision-making and
employee empowerment to achieve optimal outcomes.
The Saloro Barruecopardo Mine in Spain faces similar operational risks, though Europe’s advanced infrastructure,
including roads, ports, and utilities, supports efficient mining operations. Reliable transport networks ensure
smooth supply chain operations, from transporting raw materials to delivering finished products, while also
reducing logistics costs and improving market access.
Additional risks for both operations include, but are not limited to, adverse weather conditions, material availability,
the availability and productivity of skilled workers and contractors, industrial and environmental incidents, labour
disputes, and unexpected increases in the costs of labour, consumables, spare parts, and equipment. The operation
also faces potential IT disruptions, unforeseen regulatory changes, and broader risks tied to global uncertainty and
events such as the COVID-19 pandemic, which could include governmental responses that impact operations.
Environmental Risks
EQR must comply with a range of environmental performance and reporting requirements, many of which are
conditions of its mineral exploration and mining activities. There is a risk that the Company may not be able to
achieve the financial performance or outcomes disclosed herein if it fails to comply with those environmental
performance and reporting requirements or if the requirements change in the future and the Company is no longer
able to comply with the requirements or must incur material unplanned expenditure in order to remain compliant.
EQR seeks to manage and minimise this risk through its existing risk management framework and through detailed
environmental management plans and systems including the implementation of ISO 14001:2015 Environmental
Management Systems (EMS).
Saloro’s Barruecopardo operations are accredited under ISO 14001. The globally accepted standard offers a
structured approach for organisations to create and deploy an EMS, and continuously enhance their environmental
practices. Compliance with this standard enables organisations to proactively reduce their environmental impact,
adhere to applicable legal regulations, and fulfill their environmental goals. The framework covers numerous
elements, including resource consumption, waste management, tracking environmental performance, and
engaging stakeholders in environmental initiatives.
EQ Resources Limited Annual Report 2024 63
Social Risks
EQR is exposed to social risks as a result of the many stakeholders who are involved in its operations including but
not limited to employees, contractors, local community members residing in areas where the Company operates,
governments and government agencies (local, state and federal) as well as customers and suppliers. EQR is
subject to reputational damage as well as potential claims for damages as a result of any harm or loss sustained
by any stakeholder as a result of the actions by the Company and/or and its representatives. There is a risk that
the Company may not be able to achieve the financial performance or outcomes disclosed herein if it incurs
reputational damage or significant claims for damages. EQR seeks to manage and minimise this risk through its
existing risk management framework, including Board approved policies on stakeholder management and through
established stakeholder consultation processes.
At its Mt Carbine operations, EQR manages and minimises risks through an Integrated Health and Safety
Management System, designed to protect employees’ physical safety and mitigate operational risks. This system
is guided by the Integrated Management System (IMS), which aligns with the intended outcomes of ISO 9001:2015
Quality Management Systems.
Saloro’s operations are accredited to ISO 45001, the occupational health and safety management system that
provides an internationally recognised framework for managing health and safety risks. It enables organisations to
systematically assess hazards and implement risk control measures, resulting in fewer workplace injuries, illnesses,
and incidents.
Governance Risks
EQR must comply with a range of governance requirements which are conditions of its listing on the Australian
Securities Exchange (ASX) and of its mineral exploration and mining activities. There is a risk that the Company
may not be able to achieve the financial performance or outcomes disclosed herein if it fails to comply with those
governance requirements or if the requirements change in the future and the Company is no longer able to comply
with the requirements or must incur material unplanned expenditure in order to remain compliant. EQR seeks
to manage and minimise this risk through its existing risk management framework including Board approved
governance policies which are subject to regular review.
Financial risks
The financial risk management strategy seeks to ensure EQR can fund its corporate objectives and meet its
obligations to stakeholders. The Audit and Risk Committee and the Board carry out financial risk management to
address overall financial risk, including specific financial risks such as tungsten price risk, foreign exchange risk,
interest rate risk, credit risk, and liquidity management. At present, EQR does not hedge any of these risks.
Interest Rates – EQR is exposed to interest rate risk arising from its borrowings. Borrowings issued at variable rates
expose it to cash flow interest rate risk, and borrowings issued at fixed rates expose it to fair value interest rate risk.
Increases in interest rates, either through increases in base rates or borrowing margins, may reduce EQR’s cash
flow and profitability.
Foreign currency – EQR is exposed to foreign currency risk principally from commercial transactions and valuations
of assets and liabilities that are denominated in a currency that is not EQR’s functional currency, Australian Dollars.
EQR’s exposure to foreign currency risk arises principally through selling tungsten products denominated in
currencies other than EQR’s functional currency, principally the US dollar, and capital and operating expenditure
incurred in other currencies, principally the Euro.
Credit – EQR is also exposed to credit risk through investments in cash and cash equivalents, financial instruments
and deposits with or undrawn committed liquidity from banks and financial institutions, and credit exposures
to customers, including outstanding receivables and committed transactions. EQR may be exposed to potential
financial loss if the counterparties to those investments and transactions fail to perform as contracted. EQR
monitors its exposure to credit risk on an ongoing basis through the management of concentration risk and ageing
analysis.
Access to capital and liquidity – EQR has debt obligations and relies on access to debt and equity financing
to conduct its business, particularly the Spanish finance to support the purchase of Saloro and the proposed
expansion of the crushing capacity at the Mt Carbine mine. There is a risk that EQR may not be able to access
equity or debt capital markets to support EQR’s business objectives or successfully refinance debt facilities on
commercially favourable terms or at all. The ability to secure financing or refinancing on acceptable terms may be
adversely affected by ESG factors and the Company’s financial position or volatility in the financial markets.
Operating and Financial Review continued
64
EQ Resources Limited Annual Report 2024
EQ Resources Limited Annual Report 2024 65
Competent Persons Statement
Competent Person’s Statement - Resources
Statements contained in this announcement relating to the Mt Carbine Project Mineral Resource Estimation, are
based on, and fairly represents, information and supporting documentation prepared by Mr Chris Grove, who is
a member of the Australian Institute of Mining & Metallurgy (AusIMM), Member No 310106. Mr Grove is a full-time
employee of the mineral resource consulting company “Measured Group”, who were contracted by EQ Resources
Limited to prepare an estimate of the Mineral Resource at Mt Carbine. Mr Grove has sufficient relevant experience
in relation to the mineralisation styles being reported on to qualify as a Competent Person as defined in the
Australian Code for Reporting of Identified Mineral Resources and Ore Reserves (JORC) Code 2012. Mr Grove
consents to the use of this information in this announcement in the form and context in which it appears.
EQ Resources’ exploration and Resource work is being managed by Mr Tony Bainbridge, AusIMM. Mr Bainbridge
is engaged as a contractor by the Company and is not “independent” within the meaning of the Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code). Mr Bainbridge 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 JORC Code 2012.
The technical information contained in this announcement relating exploration results are based on, and fairly
represents, information compiled by Mr Bainbridge. Mr Bainbridge has verified and approved the data disclosed in
this release, including the sampling, analytical and test data underlying the information. The diamond core samples
were assayed at the ALS Laboratory in Brisbane, Australia. The mineral Resource estimate as shown in Annex 1
has been prepared by Measured Group. Mr Bainbridge has consented to the inclusion in this release of the matters
based on his compiled information in the form and context in which it appears in this announcement.
Competent Person’s Statement - Reserves
The information in this release relating to the Reserves Estimate is published and based on information compiled
by Mr Tony O’Connell, Principal Mining Consultant and Director of Optimal Mining Solutions Pty Ltd. Mr O’Connell
is a qualified Mining Engineer, (BE (Mining), University of Queensland), has over 24 years of experience and is a
member of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr O’Connell has sufficient experience that
is relevant to the style of mineralisation and type of deposit under consideration and the activity being undertaken
to qualify as a Competent Person as defined in the JORC Code 2012. Mr O’Connell consents to the inclusion in the
release of the matters based on his information in the form and context in which it appears.
Neither Mr O’Connell, Measured Group Pty Ltd or Optimal Mining Solutions Pty Ltd has any material interest or
entitlement, direct or indirect, in the securities of EQ Resources Limited or any associated companies.
66
EQ Resources Limited Annual Report 2024
EQ Resources Limited Annual Report 2024 67
Contents
18. Directors’ Report
33. Auditor’s Independence Declaration
34. Consolidated Statement of Comprehensive Income
35. Consolidated Statement of Financial Position
36. Consolidated Statement of Changes in Equity
38. Consolidated Statement of Cash Flows
39. Notes to the Financial Statements
99. Directors’ Declaration
100. Independent Auditor’s Report
102. Corporate Governance Statement
110. Additional Stock Exchange Information
The Directors of EQ Resources present their report on the
consolidated entity (Group), consisting of EQ Resources
and the entities it controlled at the end of, and during,
the financial year ended 30 June 2024.
Financial Report
69
Directors’ Report
81
Consolidated Statement of Profit or Loss and Other Comprehensive Income
82
Consolidated Statement of Financial Position
83
Consolidated Statement of Cash Flows
84
Consolidated Statement of Changes in Equity
85
Notes to the Consolidated Financial Statements
121
Consolidated Entity Disclosure Statement
122 Directors’ Declaration
123 Auditor’s Independence Declaration
124 Independent Auditor’s Report
Contents
68
EQ Resources Limited Annual Report 2024
Directors’ Report
3
The Directors of EQ Resources Limited (“EQ Resources” or “the Company”) present their report on the
consolidated entity (Group), consisting of EQ Resources and the entities it controlled at the end of, and during,
the financial year ended 30 June 2024.
Directors
The following persons were Directors of EQ Resources during the whole of the financial year and up to the
date of this report unless otherwise stated:
▪
Oliver Kleinhempel, Non-executive Chairman
▪
Stephen Layton, Independent Non-executive Director
▪
Richard Morrow, Independent Non-executive Director
▪
Stephen Weir, Non-executive Director (Appointed: 19 January 2024)
▪
Zhui Pei Yeo, Non-executive Director
Company Secretary
Melanie Leydin
Principal Activities
The principal activities of the Group during the 2024 financial year focused on the following:
▪
Acquisition of Saloro S.L.U. (“Saloro”) on 18 January 2024 to strengthen EQR’s relevance in the global
tungsten industry, with the Company, upon acquisition, becoming the largest independent tungsten
concentrate producer outside of Australia.
▪
Commencement of open cut mining activities at the Mt Carbine Andrew White Open Pit.
▪
Continued optimisation of the production processes and recoveries from the Gravity and XRT Sorter
Plants at both the Mt Carbine and Barruecopardo operations.
▪
Securing funding for the Mt Carbine and Barruecopardo operations and undertaking activities to advance
each project, including significant capital upgrades to plant and equipment.
▪
The execution of a definitive agreement to acquire the Mt Carbine Joint Venture interest from CRONIMET.
▪
The continuation of focused drilling programs to further define the Mt Carbine Tungsten resource.
▪
The continued assessment of the exploration potential of the Group’s tungsten tenements in Far North
Queensland whilst engaged in Farm-In and Joint Venture Agreement over its gold exploration licences in
New South Wales.
The Group also continues to evaluate other corporate and exploration opportunities within the new economy
and critical minerals sector.
Results
The net result of operations for the consolidated entity after applicable income tax expense was a loss of
$2,129,588 (2023: loss of $3,716,846).
Dividends
No dividends were paid or proposed during the period.
EQ Resources Limited Annual Report 2024 69
ANNUAL Report June 2024
Directors’ Report
4
Operating & Financial Review
Information on the operations and financial position of the Group and its business strategies and prospects for
future financial years is set out earlier in this Annual Report. The auditors have issued an unqualified opinion.
Corporate Structure
EQ Resources is a limited company that is incorporated and domiciled in Australia.
Significant Changes
Significant changes in the state of affairs of the Group for the financial year were as follows:
(a) Historic Wolfram Camp Mine Exploration Permit awarded to EQR expanding its exploration and
development interests in the Herberton Tin-Tungsten field. EQR’s commitment to fostering regional
economic growth, environmental stewardship and job creation is reflected in this strategic move. Refer
ASX announcement “EQR Awarded Permit for Historic Wolfram Camp Mine” dated 27 July 2023.
(b) Acquisition of leading European Tungsten producer, Saloro, from global investment Manager Oaktree
Capital Management L.P. (“Oaktree”) on 18 January 2024. Through the combination of both operations,
EQR becomes the largest tungsten concentrate producer in the Western World, with a robust growth
pipeline across two top-tier mining jurisdictions. As part of the transaction, Oaktree invested $25 million
into EQR at $0.09 per share.
As part of the $25 Million investment by Oaktree, Non-executive Director Stephen Weir was appointed to
the EQR Board as Oaktree’s Nominee Director and Chair of the Audit & Risk Committee on 19 January
2024.
Refer ASX Announcements “EQR Acquires Leading European Tungsten Producer, Saloro S.L.U., and
Secures $25 Million Investment by Oaktree” dated 10 August 2023; “EQR Completes Acquisition of Saloro
S.L.U. and $25 Million Placement with Oaktree” dated 18 January 2024 and “Stephen Weir Joins EQR’s
Board of Directors” dated 19 January 2024.
(c) Increase in contributed equity of $42,162,613 (before share issue costs):
Date
Number of
Shares
Issue Price
$
Issue of 957,055 shares @ $0.0650 per share upon the conversion
of unlisted options granted to sophisticated investors (refer ASX
announcement dated 11 August 2023)
11/08/2023
957,055
$0.0650
62,208
Issue of 4,698,617 shares @ $0.0650 per share upon the conversion
of unlisted options granted to sophisticated (refer ASX announcement
dated 23 August 2023)
23/08/2023
4,698,617
$0.0650
305,410
Issue of 3,125,000 shares @ $0.0650 per share upon the conversion
of unlisted options granted to sophisticated (refer ASX announcement
dated 6 September 2023)
06/09/2023
3,125,000
$0.0650
203,125
Issue of 25,000,000 shares @ $0.0650 per share upon the exercise
of unlisted options granted to sophisticated investors (refer ASX
announcement dated 22 September 2023)
22/09/2023
25,000,000
$0.0650
1,625,000
Issue of 16,730,321 shares @ $0.0650 per share on the conversion
of 4,000,000 convertible notes (refer ASX announcement dated 28
September 2023)
28/09/2023
61,538,463
$0.0400
4,000,000
Issue of 5,000,000 shares @ $0.0600 per share upon the exercise of
options granted to Key Management Personnel (refer ASX
announcement dated 8 November 2023)
08/11/2023
5,000,000
$0.0600
300,000
Issue of 278,000,000 shares @ $0.0900 per share as part of
placement with Oaktree Capital Management, L.P. Escrowed to 18
January 2024 (refer ASX announcement dated 18 January 2024)
18/01/2024
278,000,000
$0.0900
25,307,297
Issue of 1,000,000 shares @ $0.0400 per share upon the exercise of
unlisted options granted to employees (refer ASX announcement
dated 2 February 2024)
02/02/2024
1,000,000
$0.0400
40,000
Directors’ Report continued
70
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Directors’ Report
5
Date
Number of
Shares
Issue Price
$
Issue of 5,000,000 shares @ $0.0432 per share upon the exercise of
unlisted options granted to sophisticated investors (refer ASX
announcement 20 March 2024)
20/03/2024
5,000,000
$0.0432
216,000
Issue of 205,940,008 shares @ $0.0450 per share to sophisticated
investors as part of the May 2024 placement (refer ASX
announcement dated 29 May 2024)
29/05/2024
205,940,008
$0.0450
9,269,999
Issue of 542,384 shares @ $0.0461 per share for Senior Financial
Advisor Service Fees (refer ASX announcement dated 28 June 2024)
28/06/2024
542,384
$0.0461
25,004
Fair value of options exercised
808,570
TOTAL
42,162,613
(d) 50% joint venture interest in the Mt Carbine Tungsten Operation, acquired by EQR’s wholly owned
subsidiary Mt Carbine Retreatment Pty Ltd. A long-term offtake arrangement has also been entered into
under which CRONIMET Asia Pte Ltd (“CR Asia”) will purchase all tungsten concentrate from the Mt
Carbine Operation. The parties agreed on the following consideration for the transfer of the joint venture
interest:
▪ EQR to issue new ordinary shares at $0.09 per share to CR Asia (or its nominee), equal to a total of
US $7.5 million;
▪ EQR will assume all JV assets and liabilities, including all obligations under the Offtake Agreements.
As part of the transaction, CRONIMET will be granted the right to enter into a product marketing
agreement with EQR for the Barruecopardo Mine currently operated by Saloro. This agreement is
conditional upon closing the acquisition of Saloro by EQR. Refer ASX Announcement “Strategic Partner
Cronimet Joins EQR Register, as EQR Acquires JV Interest from Cronimet” dated 18 October 2023 .
Refer Note 21. Subsequent Events for further announcements pertaining to the above acquisition.
(e) Completion of a new JORC 2012 compliant Mineral Resource Estimate (“MRE”) updating Saloro’s
historical resource statement added 4.74M mtu (mtu = 10kg WO3) to EQR’s resource inventory, resulting
in EQR’s Indicated and Measured In-Situ Resources increasing by 69%. 78% of the Saloro MRE is in the
Indicated and Measured Category. Refer ASX announcement “Saloro Adds 69% of Measured and
Indicated Resources to EQR’s In-situ Resource Inventory” dated 1 February 2024 and “Supplement
information to Saloro Mineral Resource Estimate” dated 7 February 2024.
(f) Delivery completion of all core equipment under the Sandvik Crushing & Screening Package ordered in
July 2022 to facilitate the doubling of throughput capacity at the Mt Carbine mine. The construction
schedule is currently in the process of being finalised. Refer ASX announcement “Mt Carbine Receives
Additional Equipment for Doubling of Throughput Capacity” dated 20 March 2024.
(g) $20 Million 3-year loan facility agreement executed with Queensland Investment Corporation (“QIC”) from
the Queensland Critical Minerals and Battery Technology Fund (“QCMBTF”).
▪ Tranche A: $12 Million to assist in doubling processing capacity and commence underground drill
testing.
▪ Tranche B: $8 Million to continue underground drill testing and commence underground trial mining.
Utilisation of this facility is subject to the satisfaction of customary conditions precedent, including project
completion testing. For key terms, refer to ASX announcement “QIC Approves A$20M Funding for Mt
Carbine Tungsten Mine Expansion” dated 8 May 2024.
(h) $2.17 million R&D Tax refund received for the 2023 financial year from activities focused on the
Company’s commitment to operational improvement and innovation, such as:
▪ Studies on the reduction of equipment wear (selection and trial of new materials for relevant
equipment, trial of new operational conditions – in particular, with regards to fluid velocity);
EQ Resources Limited Annual Report 2024
71
ANNUAL Report June 2024
Directors’ Report
6
▪ Feed preparation improvement trials for the ore sorter plants – leading to improved performance in
terms of recovery and sorter product grade; and
▪ Preparation work for increased capacity by testing high-capacity / energy-efficient equipment.
Refer ASX announcement “Mt Carbine Tungsten Mine Receives $2.17M R&D Tax Refund” dated 10 May
2024.
(i)
Infill drilling campaigns completed at the Mt Carbine Andrew White Open Cut revealled additional high-
grade ore. Refer ASX announcements “Mt Carbine Infill Drilling Reveals Additional High-Grade Ore in
Stage II Waste Cutback Area” dated 3 June 2024; “Mt Carbine Drilling Reveals High-Grade Zones in
Stage 2 Pit” dated 30 April 2024; and “Mt Carbine Major Drilling Campaign Update” dated 30 January
2024.
(j)
Record production increases achieved throughout the second half of the 2024 financial year at both the
Mt Carbine and Barruecopardo operations. Refer ASX announcements “Mt Carbine and Saloro
Operations Hit New Production Records” dated 25 June 2024 and “Mt Carbine Hits Quarterly Production
Record” dated 11 April 2024.
Directors' Interests in Shares, Options and Performance Rights
Director
Shares Directly and
Indirectly Held
Options Directly
and Indirectly Held
Performance Rights
Directly and Indirectly
Held
O. Kleinhempel
20,033,600
312,500
-
S. Layton
55,431,559
312,500
-
R.D. Morrow
6,991,471
312,500
-
Z.P. Yeo
73,482,310
312,500
-
Directors’ interests in shares, options and performance rights as at 30 June 2023 are set out under Section (e)
of the Remuneration Report.
Company Secretary
Melanie Leydin
Ms Leydin has over 25 years experience in the accounting profession and over 15 years as a Company
Secretary with extensive experience in relation to Public Company responsibilities. Ms Leydin holds a Bachelor
of Business majoring in Accounting and Corporate Law, is a member of the Institute of Chartered Accountants,
Fellow of the Governance Institute of Australia and Registered Company Auditor. Ms Leydin graduated from
Swinburne University in 1997, became a Chartered Accountant in 1999, and since February 2000 has been
the Principal of Leydin Freyer Corp Pty Ltd. Following Leydin Freyer’s acquisition by Vistra Australia in
November 2021, Ms Leydin now holds the position of Australian Managing Director of Vistra Australia, which
provides outsourced Company Secretarial and accounting services to public and private companies across a
host of industries.
Directors’ Report continued
72
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Directors’ Report
7
Meetings of Directors
During the financial year, eleven (11) Board Meetings, two (2) Audit Committee Meetings, one (1) Risk
Committee Meeting and one (1) Remuneration & Nomination Committee Meeting was held.
Director
Meetings Eligible to Attend
Meetings Attended
O. Kleinhempel
11
11
S. Layton
11
11
R.D. Morrow
11
11
S.R. Weir
5
5
Z.P. Yeo
11
11
The following table sets out the number of meetings of committees of Directors held during the financial year
and the number of meetings attended by each Director (while they were a committee member):
Remuneration &
Nomination Committee
Audit Committee
Risk Committee
Director
Meetings
Eligible to
Attend
Meetings
Attended
Meetings
Eligible to
Attend
Meetings
Attended
Meetings
Eligible to
Attend
Meetings
Attended
O. Kleinhempel
1
1
2
2
1
1
S. Layton
1
1
2
2
1
1
R.D. Morrow
1
1
2
2
1
1
S.R. Weir
-
-
-
-
-
-
Z.P. Yeo
1
1
2
2
1
1
Share Options and Performance Rights
Whilst no Performance Rights were granted during the reporting period, Share Options were granted, as
remuneration, to Key Management Personnel of the Group.
There are 1,250,000 unissued ordinary shares of EQ Resources under vested options at the date of this report,
1,250,000 of which relate to options issued to Key Management Personnel. Refer to Remuneration Report for
further details.
Remuneration Report - Audited
This report for the year ended 30 June 2024 outlines the Group's remuneration arrangements per
the requirements of the Corporations Act 2001 (the Act) and its regulations. This information has been audited
in accordance with section 308(3C) of the Act.
The Remuneration Report details the remuneration arrangements of Key Management Personnel (KMP), who
are defined as those persons having the authority and responsibility for planning, directing and controlling the
major activities of the Group, directly or indirectly, including any Director (whether executive or otherwise) of
the parent company.
For the purposes of this report, the term ‘Executive’ includes the executive directors, senior executives and
general managers of the Group, whilst the term ‘NED’ refers to Non-Executive Directors only.
The Remuneration Report is set out under the following main headings:
(a) Policy Used to Determine the Nature and Amount of Remuneration;
(b) Key Management Personnel;
EQ Resources Limited Annual Report 2024 73
ANNUAL Report June 2024
Directors’ Report
8
(c) Details of Remuneration;
(d) Cash Bonuses;
(e) Equity Instruments;
(f) Options and Performance Rights Granted as Remuneration;
(g) Equity Instruments Issued on Exercise of Remuneration Options or Rights;
(h) Service Agreements; and
(i)
EQ Resources’ Financial Performance.
(a) Policy Used to Determine the Nature and Amount of Remuneration
The objective of the Company’s remuneration framework is to ensure that the reward for performance is
competitive and appropriate for the results delivered. The framework aligns executive reward with the
achievement of strategic objectives and the creation of value for shareholders. The Board believes that
executive remuneration satisfies the following key criteria:
▪ competitiveness and reasonableness;
▪ acceptability to shareholders;
▪ performance linkage/alignment of executive compensation;
▪ transparency; and
▪ capital management.
These criteria result in a framework that can provide a mix of fixed and variable remuneration and a blend of
short and long-term incentives in line with the Company’s financial resources.
Fees and payments to the Company’s Non-executive Directors and senior executives reflect the demands
made on and the responsibilities of the directors and senior management. Such fees and payments are
reviewed annually by the Board. The Company’s Executive and Non-executive Directors, senior executives
and officers are entitled to receive performance rights, options and/or shares under the Company’s Equity
Incentive Plan, approved by shareholders at the General Meeting held on 26 November 2020.
Fees for Non-executive Directors are not linked to the performance of the Group.
Use of Remuneration Consultants
The Group has not used any remuneration consultants during the year.
Voting and Comments made at the Group’s 2023 Annual General Meeting
The Group received votes against its Remuneration Report for the 2023 financial year; however, it did not
receive any specific feedback on its remuneration practices at the 2023 Annual General Meeting or during the
year.
Directors’ Report continued
74
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Directors’ Report
9
(b) Key Management Personnel
The following persons were Key Management Personnel of the Group during the 2024 financial year:
Position
Appointment
Resignation
Directors
O. Kleinhempel
Non-executive Director
Non-executive Chairman
12 August 2019
24 April 2020
-
S. Layton
Independent Non-executive Director
14 November 2017
-
R.D. Morrow
Independent Non-executive Director
16 March 2021
-
S.R. Weir
Non-executive Director
19 January 2024
-
Z.P. Yeo
Non-executive Director
12 August 2019
-
Executives
K.B. MacNeill
Interim Chief Executive Officer &
Senior Technical Advisor
Chief Executive Officer
4 May 2020
1 April 2021
-
-
(c) Details of Remuneration
Directors are entitled to remuneration out of the funds of the Company, but the remuneration of the Non-
executive Directors may not exceed in any year the amount fixed by the Company in general meeting for that
purpose. The aggregate remuneration of the non-executive directors has been fixed at a maximum of $400,000
per annum, which will be apportioned among the non-executive directors in the manner they determine.
Directors are also entitled to be paid reasonable travel, accommodation, and other expenses incurred due to
their attendance at Board Meetings and otherwise in executing their duties as Directors.
Details of the nature and amount of each element of the remuneration of each of the Key Management
Personnel of the Company and the consolidated entity during the year ended 30 June 2024 are set out in the
following tables:
Short-term benefits
Post-
employment
benefits
$
Share-based payments
2024
Salary &
fees
$
Non-
monetary
benefits
$
Leave
provisions
$
Shares
$
Performance
rights and
options1
$
Total
$
%
Performance
based
Directors
O. Kleinhempel
48,000
-
-
-
-
-
48,000
0.00%
S. Layton
48,000
-
-
-
-
-
48,000
0.00%
R. Morrow
48,000
-
-
-
-
-
48,000
0.00%
Z.P. Yeo
48,000
-
-
-
-
-
48,000
0.00%
Executives
K.B. MacNeill
300,000
15,661
42,892
-
-
29,651
388,204
7.6%
Total KMP
compensation
492,000
15,661
42,892
-
-
29,651
580,204
EQ Resources Limited Annual Report 2024 75
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Directors’ Report
10
Short-term benefits
Post-
employment
benefits
$
Share-based payments
2023
Salary &
fees
$
Non-
monetary
benefits
$
Leave
provisions
$
Shares
$
Performance
rights and
options1
$
Total
$
%
Performance
based
Directors
O. Kleinhempel
48,000
-
-
-
-
37,967
85,967
44.2%
S. Layton
48,000
-
-
-
-
19,150
67,150
28.5%
R. Morrow
48,000
-
-
-
-
19,150
67,150
28.5%
Z.P. Yeo
48,000
-
-
-
-
19,150
67,150
28.5%
Executives
K.B. MacNeill
300,000
15,661
25,991
-
25,413
367,065
6.9%
Total KMP
compensation
492,000
15,661
25,991
-
-
120,830
654,482
Performance rights and options do not represent cash payment to Directors or senior executives, and performance rights/options granted
may or may not be exercised by the Directors or executives.
(d) Cash Bonuses
No cash bonuses were paid during the reporting period.
(e) Equity Instruments
The Company rewards Directors and executives for their performance and aligns their remuneration with the
creation of shareholder wealth by issuing shares, options or performance rights. Share-based compensation
is at the discretion of the Board, and no individual has an unconditional contractual right to participate in any
share-based plan or receive any guaranteed benefits.
(i) Shareholdings
The trading of shares issued pursuant to the Company’s Equity Incentive Plan is subject to the Company’s
Securities Trading Policy. Key Management Personnel and employees are encouraged not to trade shares
granted to align the Director, Key Management Personnel and employee interests with all shareholders'
interests. Details of equity instruments (other than options and rights) held directly, indirectly or beneficially by
Key Management Personnel and their related parties are as follows:
30 June 2024
Balance at
1 July 2023
Granted as
compensation
Received on
exercise of
Performance
Rights/ Options
Other
Changes
Balance at
30 June 2024
Balance held
nominally
Directors
O. Kleinhempel
20,033,600
-
2,000,000
-
22,033,600
-
S. Layton
55,431,559
-
-
-
55,431,559
-
R. Morrow
5,991,471
-
1,000,000
-
6,991,471
-
S. Weir
-
-
-
-
-
-
Z.P. Yeo
71,482,310
-
2,000,000
-
73,482,310
-
Executives
K.B. MacNeill
4,161,789
-
-
(690,000)
3,471,789
-
157,100,729
-
5,000,000
(690,000)
161,410,729
-
Directors’ Report continued
76
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Directors’ Report
11
(ii) Options and Performance Rights Holdings
Details of options and performance rights held directly, indirectly or beneficially by Key Management Personnel
and their related parties during the financial year are as follows:
30 June 2024
Balance at
1 July 2023
Granted
Lapsed
Exercised
Balance
Total vested
and
exercisable
Total
unvested &
unexercisable
Directors
O. Kleinhempel
10,312,500
-
(8,000,000)
(2,000,000)
312,500
312,500
-
S. Layton
4,312,500
-
(4,000,000)
-
312,500
312,500
-
R. Morrow
4,312,500
-
(3,000,000)
(1,000,000)
312,500
312,500
-
Z.P. Yeo
4,312,500
-
(2,000,000)
(2,000,000)
312,500
312,500
-
Executives
K.B. MacNeill
10,000,000
1,000,000
(10,000,000)
-
1,000,000
-
1,000,000
33,250,000
1,000,000
(27,000,000)
(5,000,000)
2,250,000
1,250,000
1,000,000
(iii) Loans to Key Management Personnel
No loans have been made to Key Management Personnel of the consolidated Group, including their personally
related entities during the reporting period.
(iv) Other Transactions and Balances
No transactions were entered into with Key Management Personnel during the financial year other than those
disclosed in Note 35 (d).
(f)
Options and Performance Rights Granted as Remuneration
The Company granted the following options to Key Management Personnel of the Group during the reporting
period as part of their remuneration:
30 June 2024
Number
of granted
options
Grant date
Expiry
date
Fair Value
per Option
at the
grant date
Total fair
value of
options
Share-Based Payments
Forfeited
Expensed
2024 year
IFRS 2
Not yet
expensed
Executives
K.B. MacNeill
1,000,000
03/07/23
03/07/26
$0.02993
29,933
-
29,769
164
1,000,000
29,933
-
29,769
164
(g) Equity Instruments Issued on Exercise of Remuneration Options or Rights
5,000,000 equity instruments were issued during the 2024 financial year to Key Management Personnel as a
result of options exercised that had previously been granted as remuneration.
(h) Service Agreements
Remuneration and other terms of employment for the Key Management Personnel are formalised in
Service/Appointment Agreements. All contracts may be terminated by either party with regards to the stipulated
notice period, subject to any termination payments as detailed below.
Directors
O. Kleinhempel
There is a written agreement with Mr Kleinhempel dated 12 August 2019 in his role as Non-executive Director
of the Company and subsequently as Non-Executive Chairman on 24 April 2020. Cash payments and benefits
totalling $16,000 were paid to Mr Kleinhempel during the 2024 financial year whilst $32,000 were outstanding
at year end.
EQ Resources Limited Annual Report 2024 77
ANNUAL Report June 2024
Directors’ Report
12
S. Layton
There is a written agreement with Mr Layton dated 9 November 2017 in his role as Non-executive Director of
the Company. Cash payments and benefits totalling $48,000 were paid to Mr Layton during the 2024 financial
year. The payments were made through Bodie Investments Pty Ltd, a company in which Mr Layton has a
substantial interest.
R.D. Morrow
There is a written agreement with Mr Morrow dated 22 February 2021 in his role as Non-executive Director of
the Company. Payments and benefits totalling $48,000 were paid to Mr Morrow during the 2024 financial year.
S.R. Weir
There is a written agreement with Mr Weir appointed Nominee Director for Oaktree Capital Management, L.P.
(“Oaktree”). Mr Weir’s compensation is covered by Oaktree.
Z.P. Yeo
There is a written agreement with Mr Yeo dated 12 August 2019 in his role as Non-executive Director of the
Company. Cash payments and benefits totalling $4,000 were paid to Mr Yeo during the 2024 financial year
whilst $44,000 were outstanding at year end.
Executives
K.B. MacNeill
There was a written agreement with Mr MacNeill dated 1 April 2021 in his role as Chief Executive Officer. The
Company or Mr MacNeill may terminate the contract by giving three month’s written notice. Mr MacNeill
received cash payments and non-monetary benefits totalling $388,204 during the 2024 financial year.
(i)
EQ Resources’ Financial Performance
EQ Resources’ financial performance for the five years to 30 June 2024 is summarised below, and the
relationship between results and performance is discussed.
Year ended
Measure
2024
2023
2022
2021
2020
Net profit / (loss) after tax
$
(2,129,588)
(3,716,846)
(6,063,051)
(4,574,191)
(3,015,680)
Net assets
$
56,625,658
16,304,564
14,317,218
16,725,734
14,936,296
Cash and cash equivalents
$
3,489,532
5,335,596
1,723,426
3,504,721
2,989,859
Cash flows from operating activities
$
(12,703,554)
(1,392,628)
(3,112,770)
(3,816,722)
(2,948,321)
EBITDA
$
(18,467,257)
(829,258)
(4,478,339)
(3,947,550)
(2,789,350)
Share price at 30 June
$
$0.048
$0.070
$0.047
$0.028
$0.028
Basic earnings / (loss) per share
Cents
(0.13)
(0.26)
(0.45)
(0.39)
(0.30)
Financial Performance
The loss for the consolidated Group for the financial year after tax amounted to $2,129,588 (2023: loss of
$3,716,846).
The Group has created value for shareholders through:
▪ Acquisition of Saloro S.L.U. (“Saloro”) on 18 January 2024 to strengthen EQR’s relevance in the global
tungsten industry, with the Company, upon acquisition, becoming the largest independent tungsten
concentrate producer outside of Australia.
▪ Full 12 months of open cut mining activities at the Mt Carbine Andrew White Open Pit.
▪ Continued optimisation of the production processes and recoveries from the Gravity and XRT Sorter Plants
at both the Mt Carbine and Barruecopardo operations.
Directors’ Report continued
78
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Directors’ Report
13
▪ Securing funding for the Mt Carbine and Barruecopardo operations and undertaking activities to advance
each project, including significant capital upgrades to plant and equipment.
▪ The execution of a definitive agreement to acquire the Mt Carbine Joint Venture interest from CRONIMET.
▪ The continuation of focused drilling programs to further define the Mt Carbine Tungsten resource.
Financial Position
In accordance with the Company’s accounting policy, the recoverability of the carrying amounts of Deferred
Exploration and Evaluation Expenditures were reassessed during the 2024 financial year with no impairments
recognised, resulting in exploration and evaluation expenses of $1,934,696 before amortisation and R&D Tax
Offset, being capitalised for the 2024 financial year. The carrying value of the exploration assets as at 30 June
2024 is $14,922,119 (2023: $14,273,131).
At 30 June 2024, the Group had a net working capital deficit of $55,567,286 (2023: $13,978,417 deficit). The
deficit in net working capital is predominately due to:
-
The recognition of $40,226,904 of borrowings as a result of the acquisition of Saloro on 18 January 2024.
All borrowings are classified as current due to their renewal extensions falling within 12 months of reporting
date; and
-
The Company’s growth initiatives being funded via short-term financing facilities such as equipment leases,
government grants and trade payables.
It should be noted that:
-
Whilst the offtake advance facility of $4,906,401 is classified as a current liability, due to the Company not
having an unconditional right to defer settlement for at least 12 months after the reporting date, it is
scheduled to be repaid over the life of the Mt Carbine Mine rather than within the next 12 months as depicted
on the Statement of Financial Position.
During the year, the Company’s issued share capital increased by $42,162,613 (before share issue costs).
Refer to Significant Changes on Page 70 for further details.
Indemnification and Insurance of Officers and Auditors
Indemnification
The Company has not, during or since the end of the financial period, in respect of any person who is or has
been an Officer of the Company or a related body corporate indemnified or made any relevant agreement for
indemnifying against a liability incurred as an Officer, including costs and expenses in successfully defending
legal proceedings.
Insurance Premiums
During the financial period, the Company has paid premiums to insure each of the Directors and Officers
against liabilities for costs and expenses incurred by them in defending any legal proceedings arising out of
their conduct whilst acting in the capacity of a Director or Officer of the Company, other than conduct involving
a wilful breach of duty in relation to the Company.
The premiums paid are not disclosed, as such disclosure is prohibited under the terms of the insurance
contract.
EQ Resources Limited Annual Report 2024 79
ANNUAL Report June 2024
Directors’ Report
14
Audit and Non–Audit Services
During the financial year, the following fees for audit and non-audit services were paid or payable to Nexia
Melbourne Audit Pty Ltd, Nexia Melbourne Pty Ltd and Deloitte, Spain:
2024
$
2023
$
Audit-related services
Amounts paid or payable:
- Nexia Melbourne Audit Pty Ltd
176,245
88,680
- Deloitte, Spain
25,671
-
Taxation services
Amounts paid or payable:
- Nexia Melbourne Pty Ltd
27,634
16,700
- Deloitte, Spain
65,793
-
295,343
105,380
The Directors are satisfied that the provision of non-audit services during the year by the auditor is compatible
with the general standard of independence for auditors imposed by the Corporations Act 2001.
On the advice of the Audit Committee, the Directors are satisfied that the provision of non-audit services by
the auditor, as set out above, did not compromise the auditor independence requirements of the Corporations
Act 2001 for the following reasons:
▪
the Audit Committee has reviewed all non-audit services to ensure that they do not impact the integrity
and objectivity of the auditor; and
▪
none of the non-audit services undermine the general principles relating to auditor independence as set
out in APES 110 Code of Ethics for Professional Accountants.
Auditor’s Independence Declaration
A copy of the Auditor’s Independence Declaration, as required under section 307C of the Corporations Act
2001, is set out and located after the Director’s Declaration and forms part of this report.
Corporate Governance
A statement disclosing the extent to which the Company has followed the best practice recommendations set
by the ASX Corporate Governance Council during the period is displayed on the Company’s website at
https://www.eqresources.com.au/site/who-we-are/corporate-governance.
Signed this 30th day of September 2024 in accordance with a resolution of Directors.
Oliver Kleinhempel
Non-executive Chairman
Directors’ Report continued
80
EQ Resources Limited Annual Report 2024
15
Note
2024
$
2023
$
Revenue
2
26,838,757
5,138,414
Other income
2
3,488,333
7,981,238
Total revenue & other income
30,327,090
13,119,652
Administration expenses
(1,915,748)
(1,077,473)
Consultant expenses
(364,943)
(450,804)
Depreciation
10
(6,145,479)
(1,292,283)
Amortisation – deferred exploration & evaluation
11
(1,021,333)
(131,796)
Development and testwork costs
(1,027,001)
(710,998)
Exploration expenses written-off
(16,063)
(3,187)
ESG initiatives
(49,650)
(45,540)
Finance costs
(2,624,813)
(1,491,341)
Foreign exchange gains (losses)
93,968
(221,964)
Occupancy expenses
(796,179)
(276,104)
Gain / (Loss) on disposal of fixed assets
2,718
(87,946)
Production expenses
(29,813,628)
(4,547,603)
Salaries and employee benefits expense
(10,746,580)
(5,248,052)
Share based payments
29
(3,539,925)
(674,837)
Superannuation
(523,597)
(406,687)
Travel and accommodation
(97,719)
(169,496)
Total expenses
(58,585,972)
(16,836,111)
Profit (Loss) before income tax expense
(28,258,882)
(3,716,459)
Income tax expense
4
-
-
Profit (Loss) after income tax expense
(28,258,882)
(3,716,459)
Other comprehensive income/(loss)
Gain/(loss) on revaluation of financial assets
(3,996)
(387)
Gain/(loss) on financial asset revaluation
1,698,278
-
Bargain purchase gain
3
24,435,012
-
Total Comprehensive Profit / (Loss)
Attributable to Owners of EQ Resources Limited
(2,129,588)
(3,716,846)
Cents
Cents
Basic profit (loss) per share
15
(0.13)
(0.26)
Diluted profit (loss) per share
15
(0.11)
(0.24)
Consolidated Statement of Profit or Loss
and Other Comprehensive Income
EQ Resources Limited Annual Report 2024
81
16
Note
2024
$
2023
$
Current Assets
Cash assets
22(b)
3,489,532
5,335,596
Trade and other receivables
8
16,482,084
3,933,612
Prepayments
8
656,636
634,064
Inventory
5
17,145,002
877,740
Financial assets
5
840,973
815,649
Total current assets
38,614,227
11,596,661
Non-Current Assets
Receivables
9
1,248,267
4,487,440
Property, plant and equipment
10, 20
99,523,735
14,014,956
Inventory
6
8,159,128
8,213,656
Deferred exploration and evaluation
11, 20
14,922,119
14,273,131
Financial assets
6
3,818,933
2,560,468
Total Non-Current Assets
127,672,182
43,549,651
Total Assets
166,286,409
55,146,312
Current Liabilities
Trade and other payables
12, 27
42,647,114
11,309,854
Employee benefits
29
516,930
439,919
Lease liability
26, 28
1,324,113
910,822
Convertible notes
14
-
3,494,215
Financial liabilities
25
1,294,812
1,369,196
Contract liability – offtake
23
4,906,401
4,901,961
Contract liability – sublease
23
1,466,669
1,768,851
Borrowings
24
42,025,474
-
Total Current Liabilities
94,181,513
24,194,818
Non-Current Liabilities
Employee benefits
29
22,383
31,868
Lease liability
26, 28
1,823,620
1,176,523
Convertible notes
14
549,012
-
Financial liabilities
25
10,819,849
11,787,921
Provisions
31
2,264,374
-
Borrowings
24
-
1,650,618
Total Non-Current Liabilities
15,479,238
14,646,930
Total Liabilities
109,660,751
38,841,748
Net Assets
56,625,658
16,304,564
Equity
Issued capital
13
68,338,429
27,222,060
Reserves
5,675,116
3,523,413
Accumulated losses
(17,387,887)
(14,440,909)
Total Equity
56,625,658
16,304,564
Consolidated Statement of Financial Position
As at 30 June 2024
82
EQ Resources Limited Annual Report 2024
17
Note
2024
$
2023
$
Cash Flows from Operating Activities
Proceeds from sales to customers
28,416,570
6,236,356
Proceeds from R & D tax offset
2,152,803
2,346,937
Proceeds from diesel fuel rebate
749,802
271,989
Proceeds from grants
651,411
5,983,000
Proceeds from other sources
9,242
307,160
Payment to suppliers and employees
(43,679,827)
(16,499,915)
Interest paid
(911,428)
-
Interest paid for lease liabilities
(150,111)
(55,834)
Interest received
57,984
17,679
Net Cash Flows Used in Operating Activities
22(a)
(12,703,554)
(1,392,628)
Cash Flows from Investing Activities
Payments for the purchase of plant and equipment
(12,656,696)
(4,293,175)
Payments for the capitalised exploration and evaluation expenditure
(1,880,376)
(3,085,926)
Payments for the purchase of other entities
(2,198,705)
-
Proceeds from the sale or disposal of plant and equipment
8,956
118,291
Payment of loan to other entities (unincorporated joint venture)
(2,122,550)
(3,694,544)
Proceeds from release of other security deposits
-
-
Payments for the purchase of tenements
-
-
Payments / proceeds for tenement security deposits
(50,000)
-
Net Cash Flows Used in Investing Activities
(18,899,371)
(10,955,354)
Cash Flows from Financing Activities
Proceeds from the issue of shares
34,269,999
4,812,000
Proceeds from the issue of convertible notes
750,000
-
Proceeds from the issue of share options
2,495,744
-
Payments for share / convertible note issue costs
(430,748)
224,307
Proceeds from long-term loan facilities
259,860
10,000,000
Proceeds from short-term loan facilities (unincorporated joint venture)
1,932,500
100,000
Proceeds from short-term loan facilities (other related parties)
-
-
Payments for lease liabilities
(787,582)
(289,658)
Payments for loans and borrowing cost
(16,548,000)
(317,689)
Payments for transaction costs of loans and borrowings
(383,739)
-
Proceeds from offtake advance extension
-
1,482,960
Net Cash Flows from Financing Activities
21,558,034
16,011,920
Net (decrease)/increase in cash held
(10,044,891)
3,663,939
Add opening cash brought forward
5,335,596
1,723,426
Add opening cash from acquiring other entities
8,280,498
-
Effect of movement in exchange rates on cash held
(81,671)
(51,769)
Closing Cash Carried Forward
22(b)
3,489,532
5,335,596
For the year ended 30 June 2024
Consolidated Statement of Cash Flows
EQ Resources Limited Annual Report 2024 83
18
Attributable to the Shareholders of EQ Resources Limited
Consolidated
Issued Capital
$
Accumulated
Losses
$
Reserves
$
Total Equity
$
At 1 July 2022
22,192,705
(10,724,063)
2,848,576
14,317,218
Profit / (loss) before income tax for the period
-
(3,716,459)
-
(3,716,459)
Other comprehensive income for the period
-
(387)
-
(387)
Total comprehensive loss for the period
-
(3,716,846)
-
(3,716,846)
Issue of share capital
5,332,000
-
-
5,332,000
Share issue costs
(302,645)
-
-
(302,645)
Share based payments
-
-
674,837
674,837
Total transactions with owners in their capacity as owners
5,029,355
-
674,837
5,704,192
Balance at 30 June 2023
27,222,060
(14,440,909)
3,523,413
16,304,564
At 1 July 2023
27,222,060
(14,440,909)
3,523,413
16,304,564
Profit / (loss) before income tax for the period
-
(28,258,882)
-
(28,258,882)
Currency translation difference
-
(817,390)
-
(817,390)
Bargain purchase gain
-
24,435,012
-
24,435,012
Gain/(loss) on revaluation of financial assets
-
1,698,278
-
1,698,278
Prior period adjustment
154,323
-
-
154,323
Other comprehensive income for the period
-
(3,996)
-
(3,996)
Total comprehensive loss for the period
154,323
(2,946,978)
-
(2,792,655)
Issue of share capital
42,162,613
-
-
42,162,613
Share issue costs
(1,200,567)
-
-
(1,200,567)
Share based payments
-
-
4,036,880
4,036,880
Equity settled share based payments
-
-
(1,885,177)
(1,885,177)
Total transactions with owners in their capacity as owners
40,962,046
-
2,151,703
43,113,749
Balance at 30 June 2024
68,338,429
(17,387,887)
5,675,116
56,625,658
For the year ended 30 June 2024
Consolidated Statement of Changes in Equity
84
EQ Resources Limited Annual Report 2024
19
1. SUMMARY OF MATERIAL ACCOUNTING POLICY INFORMATION
(a) Going Concern Basis for Preparation of Financial Statements
These financial statements have been prepared on the going concern basis which contemplates the continuity
of normal business activities and the realisation of assets and the discharge of liabilities in the normal course
of business.
For the full year ended 30 June 2024, the consolidated entity incurred a total comprehensive loss of $2,129,588
(2023: loss of $3,716,846), incurred cash outflows from operating activities of $12,703,554 (2023: $1,392,628)
and had a net working capital deficit of $55,567,286 (2023: $12,598,157 deficit). The deficit in net working
capital is predominately due to:
• The recognition of $40,226,904 of borrowing as a result of the acquisition of Saloro on 18 January 2024. All
borrowings are classified as current due to their renewal extensions falling within 12 months of the reporting
date.
• The funding of the Company’s growth initiatives via short-term financing facilities such as equipment leases,
and trade payables.
The ability of the Company to continue to adopt the going concern assumption is based upon:
▪ Continued optimisation of the production processes and recoveries from the Gravity and XRT Sorter Plants
at both the Mt Carbine and Barruecopardo operations.
▪ Extension/refinance of the Saloro current borrowing or extension of the letter of credit from Oaktree Capital
Management L.P, which currently supports the debt until 28 June 2025;
▪ Continued engagement with strategic partners to secure offtake prepayments;
▪ Continued success with grant applications for companies operating in the critical minerals sector; and
▪ Continued success issuing equity to strategic partners and or existing shareholders.
(b) Basis of Preparation
These general-purpose financial statements have been prepared in accordance with the requirements of the
Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements
of the Australian Accounting Standards Board and the Corporations Act 2001. These financial statements have
been prepared on a historical cost basis. The financial report is presented in Australian currency. The
consolidated entity operates on a for-profit basis.
(c) Statement of Compliance
The financial statements have been prepared and comply with Australian Accounting Standards. The financial
statements also comply with International Financial Reporting Standards (IFRS) as issued by the International
Accounting Standards Board.
(d) Basis of Consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities
controlled by the Company (its subsidiaries) as at 30 June each year. Control is defined as entities which the
Group has power over and the rights to, or is exposed to, variable returns from its involvement with the entity
and has the ability to use its power to affect those returns.
The financial statements of subsidiaries are prepared for the same reporting period as the parent company,
using consistent accounting policies.
Adjustments are made to bring into line any dissimilar accounting policies that may exist.
Notes to the Consolidated Financial Statements
For the year ended 30 June 2024
EQ Resources Limited Annual Report 2024 85
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
20
All inter-company balances and transactions, including unrealised profits arising from intra-group transactions,
have been eliminated in full.
Subsidiaries are fully consolidated from the date upon which control is transferred to the Group and cease to
be consolidated from the date upon which control is transferred out of the Group.
Interests in Joint Operations
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have
rights to the assets, and obligations for the liabilities, relating to the arrangement. Joint control is the
contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant
activities require unanimous consent of the parties sharing control.
When a Group entity undertakes its activities under joint operations, the Group as a joint operator recognises
in relation to its interest in a joint operation:
▪ its assets, including its share of any assets held jointly;
▪ its liabilities, including its share of any liabilities incurred jointly;
▪ its revenue from the sale of its share of the output arising from the joint operation;
▪ its share of the revenue from the sale of the output by the joint operation; and
▪ its expenses, including its share of any expenses incurred jointly.
The Group accounts for the assets, liabilities, revenue and expenses relating to its interest in a joint operation
in accordance with the IFRS Standards applicable to the particular assets, liabilities, revenue and expenses.
When a Group entity transacts with a joint operation in which a Group entity is a joint operator (such as a sale
or contribution of assets), the Group is considered to be conducting the transaction with the other parties to
the joint operation, and gains and losses resulting from the transactions are recognised in the Group’s
consolidated financial statements only to the extent of other parties’ interests in the joint operation.
When a Group entity transacts with a joint operation in which a Group entity is a joint operator (such as a
purchase of assets), the Group does not recognise its share of the gains and losses until it resells those assets
to a third party. The requirements of IAS 36 are applied to determine whether it is necessary to recognise any
impairment loss with respect to the Group’s investment in an associate or a joint venture. When necessary,
the entire carrying amount of the investment (including goodwill) is tested for impairment in accordance with
IAS 36 as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs
of disposal) with its carrying amount. Any impairment loss recognised is not allocated to any asset, including
goodwill that forms part of the carrying amount of the investment. Any reversal of that impairment loss is
recognised in accordance with IAS 36 to the extent that the recoverable amount of the investment
subsequently increases.
(e) Business Combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a
business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair
values of assets transferred by the Group, liabilities incurred by the Group to the former owners of the acquiree
and the equity interest issued by the Group in exchange for control of the acquiree. Acquisition related costs
are capitalised and amoritised over the life-of-mine of the acquiree.
At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair
value at the acquisition date, except that:
▪ Deferred tax assets or liabilities related to employee benefit arrangements are recognised and measured
in accordance with IAS 12 and IAS 19 Employee Benefits respectively.
▪ Liabilities or equity instruments related to share-based payment arrangements of the acquiree or share-
based payment arrangements of the group entered into to replace share-based payment arrangements of
the acquiree are measured in accordance with IFRS 2 Share-based Payment at the acquisition date.
Notes to the Consolidated Financial Statements continued
86
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
21
▪ Assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-current
assets Held for Sale and Discontinued Operations are measured in accordance with that Standard.
Goodwill is measured at the excess of the sum of the consideration transferred, the amount of any non-
controlling interest in the acquiree, and the fair value of the acquirer’s previously held equity interest in the
acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the
liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets
acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-
controlling interests in the acquiree and the fair value of the acquirer’s previously held interest if the acquiree
(if any), the excess is recognised immediately in profit or loss as a bargain purchase gain.
If the initial accounting for a business combination is incomplete by the end of the reporting period in which the
combination occurs, the group reports provisional amounts for the items for which the accounting is incomplete.
Those provisional amounts are adjusted during the measurement period (12 months from reporting date), or
additional assets or liabilities are recognised, to reflect new information obtained about facts and
circumstances that existed as of the acquisition date that, if known, would have affected the amounts
recognised as of that date.
(f)
Property, Plant and Equipment
Recognition and Measurement
Property, Plant and Equipment
Property, plant and equipment are stated at cost less accumulated depreciation and any impairment in value.
Cost is the fair value of consideration given to acquire the asset at the time of its acquisition, or construction
and includes the direct costs of bringing the asset to the location and the condition necessary for operation.
Right-of-use assets are measured at cost, less and accumulated depreciation and impairment losses, and
adjusted for any remeasurement of lease liabilities. Right-of-use assets are presented within the category of
property, plant and equipment according to the nature of the underlying asset leased.
Recoverable Amount of Assets
At each reporting date, the Group assesses whether there is any indication that an asset may be impaired.
Where an indicator of impairment exists, the Group makes a formal estimate of the recoverable amount. Where
the carrying amount of an asset exceeds its recoverable amount the asset is considered impaired and is written
down to its recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use.
Impairment
The carrying values of plant and equipment are reviewed for impairment when events or changes in
circumstances indicate the carrying value may not be recoverable.
An item of plant and equipment is derecognised upon disposal.
Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the item) is included in the income statement in the period the item is
derecognised.
Exploration, Evaluation, Development and Restoration Costs
Exploration and Evaluation
Exploration and evaluation expenditure incurred by or on behalf of the Company is accumulated separately
for each area of interest. Such expenditure comprises net direct costs and an appropriate portion of related
overhead expenditure but does not include general overheads or administrative expenditure not having a
specific connection with a particular area of interest.
EQ Resources Limited Annual Report 2024 87
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
22
Exploration and evaluation costs in relation to separate areas of interest for which rights of tenure are current
are brought to account in the year in which they are incurred and carried forward provided that:
▪ such costs are expected to be recouped through successful development and exploitation of the area, or
alternatively through its sale; or
▪ exploration and/or evaluation activities in the area have not yet reached a stage which permits a reasonable
assessment of the existence or otherwise of economically recoverable reserves.
Once a development decision has been taken, all past and future exploration and evaluation expenditure in
respect of the area of interest is aggregated within costs of development.
Impairment
The Directors assess at each reporting date whether the above carry forward criteria are met for exploration
and evaluation costs.
Accumulated costs in respect of areas of interest are written off or a provision made in profit or loss when the
above criteria do not apply or when the Directors assess that the carrying value may exceed the recoverable
amount. The costs of productive areas are amortised over the life of the area of interest to which such costs
relate on the production output basis, provisions would be reviewed and if appropriate, written back.
Development Expenditure
Development expenditure incurred by or on behalf of the Company is accumulated separately for each area
of interest in which economically recoverable reserves have been identified to the satisfaction of the Directors.
Such expenditure comprises net direct costs and, in the same manner as for exploration and evaluation
expenditure, an appropriate portion of related overhead expenditure having a specific connection with the
development property.
All expenditure incurred prior to the commencement of commercial levels of production from each development
property is carried forward to the extent to which recoupment out of revenue to be derived from the sale of
production from the relevant development property, or from the sale of that property, is reasonably assured.
No amortisation is provided in respect of development properties until a decision has been made to commence
mining. After this decision, all subsequent development expenditure is capitalised and classified as assets
under construction, provided commercial viability conditions continue to be satisfied and the previously
recognised costs are amortised over the life of the area of interest, to which such costs relate, on a units of
production (UoP) basis.
Mine Properties
Mine properties comprise of:
▪ capitalised exploration, evaluation and development expenditure for assets in production;
▪ mineral rights acquired; and
▪ capitalised development and production stripping costs.
Overburden Removal Costs
The process of removing overburden and other waste materials to access mineral deposits is referred to as
stripping. Stripping is necessary to obtain access to mineral deposits and occurs throughout the life of an open-
pit mine. Development and production stripping costs are classified as other mineral assets in property, plant
and equipment.
The Group accounts for stripping activities as follows:
Development Stripping Costs
These are initial overburden removal costs incurred to obtain access to mineral deposits that will be
commercially produced. These costs are capitalised when it is probable that future economic benefits (access
to mineral ores) will flow to the Group and costs can be measured reliably.
Notes to the Consolidated Financial Statements continued
88
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
23
Once the production phase begins, capitalised development stripping costs are depreciated using the UoP
method based on the proven and probable reserves of the relevant identified component of the ore body which
the initial stripping activity benefits.
Production Stripping Costs
These are post initial overburden removal costs incurred during the normal course of production activity, which
commences after the first saleable minerals have been extracted. Production stripping costs can give rise to
two benefits, the accounting for which is outlined below:
Production Stripping Activity
Benefits of stripping activity
Extraction of ore (inventory in the current
period.
Improved access to future ore extraction.
Period benefited
Current period.
Future period(s).
Recognition and measurement
criteria
When the benefits of stripping activities are
realised in the form of inventory produced; the
associated costs are recorded in accordance
with the Group’s inventory accounting policy.
When the benefits of stripping activies are
improved access to future ore; production costs
are capitalised when all the following criteria are
met:
▪ the production stripping activity improves
access to a specific component of the ore
body and it is probable that future economic
benefits arising from the improved access to
future ore production will be realised.
▪ The component of the ore body for which
access has been improved can be identified.
▪ Costs associated with that component can
be measured reliably.
Allocation of costs
Production stripping costs are allocated between the inventory produced and the production
stripping asset using a life-of-component waste-to-ore (or mineral contained) strip ratio. When
the current strip ratio is greater than the estimated life-of component ratio a portion of the
stripping costs are capitalised to the production stripping asset.
Asset recognised from stripping
activity
Inventory
Other mineral assets within property, plant and
equipment
Depreciation basis
Not applicable
On a component-buy-component basis using
the units of production method based on proven
and probable reserves.
Depreciation
Depreciation of assets, other than land, assets under construction and capitalised exploration and evaluation
that are not depreciated, is calculated using the straight-line (SL) method or UoP method, net of residual
values, over the estimated useful lives of specific assets. The depreciation method and rates applied to specific
assets reflect the pattern in which the asset’s benefits are expected to the used by the Group. The Group’s
proved and probable reserves for mineral assets are used to determine Up depreciation unless doing so results
in depreciation charges that do not reflect the asset’s useful life.
Assets classified as held for sale are measured at the lower of their carrying amount and fair value less cost
to sell and therefore not depreciated.
EQ Resources Limited Annual Report 2024 89
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Notes to the Consolidated Financial Statements
24
Key Estimates
The determination of useful lives, residual values and depreciation methods involves estimates and
assumptions and are reviewed annually. Any changes to useful lives or other estimates or assumptions, may
affect prospective depreciation rates and asset carrying values.
Category
Buildings
Plant &
Equipment
Mineral Rights
Capitalised exploration,
evaluation and
development expenditure
Typical Depreciation Methodology
SL
SL
UoP
UoP
Depreciation Rate
1 – 25 years
Based on the rate of
depletion of reserves
Based on the rate of
depletion of reserves.
Remaining Mine Life
In estimating the remaining life of the mine at each mine property for the purpose of amortisation and
depreciation calculations, due regard is given not only to the volume of remaining economically recoverable
reserves but also to limitations which could arise from the potential for changes in technology, demand, product
substitution and other issues that are inherently difficult to estimate over a lengthy time frame.
Capital Works in Progress
Capital works in progress are measured at cost inclusive of associated on-costs and charges. Costs are only
capitalised when it is probable that future economic benefits will flow to the Group and costs can be measured
reliably.
All assets included in capital works in progress are reclassified to other categories within property, plant and
equipment when the asset is available and ready for use in the manner intended.
Intangible Assets
Intangible Assets Acquired Separately
Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated
amortisation and accumulated impairment losses. Amortisation is recognised on a straight-line basis over their
estimated useful lives. The estimated useful life and amortisation method are reviewed at the end of each
reporting period, with the effect of any changes in the estimates being accounted for on a prospective basis.
Intangible assets with indefinite useful lives that are acquired separately are carried at cost less accumulated
impairment losses.
Initial payments for the acquisition of intangible mineral lease assets are capitalised and amortised over the
term of the permit. A regular review is undertaken of each area of interest to determine the appropriateness of
continuing to carry forward costs in relation to that area. Capitalised costs are only carried forward to the extent
that they are expected to be recovered through the successful exploitation of the area of interest or alternatively
by its sale. To the extent that the capitalised expenditure is no longer expected to be recovered, it is charged
to the income statement.
Intangible Assets Acquired in a Business Combination
Intangible assets acquired in a business combination and recognised separately from goodwill, are recognised
initially at their fair value at the acquisition date (which is regarded as their cost).
After initial recognition, intangible assets acquired in a business combination are reported at cost less
accumulated amortisation and accumulated impairment losses, on the same basis as intangible assets that
are acquired separately.
Derecognition of intangible assets
An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use
or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference
between the net disposal proceeds and the carrying amount of the asset, are recognised in profit or loss when
the asset is derecognised.
Notes to the Consolidated Financial Statements continued
90
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Notes to the Consolidated Financial Statements
25
(g) Inventory
Inventory is valued at the lower of cost and net realisable value as per AASB 102 with the exception of the 7
million tonnes of stockpiled inventory which was recognised at fair value as part of the Mt Carbine Quarries
Pty Ltd business combination recognised on 28 June 2019. This inventory will be consumed on a units of
operation basis.
The cost of partly-processed and saleable products is generally the cost of production, including:
▪ labour costs, materials and contractor expenses which are directly attributable to the processing of quarry
material or the production of tungsten concentrate;
▪ the depreciation of property, plant and equipment used in the processing of quarry material or the
production of tungsten concentrate; and
▪ Production overheads.
For processed inventories, costs are derived on an absorption costing basis. Cost comprises costs of
purchasing raw materials and costs of production, including attributable mining and processing overheads
taking into consideration normal operating capacity.
Inventory quantities are assessed primarily through surveys and assays.
(h) Borrowings
Borrowings are initially measured at fair value, and are subsequently measured at amortised cost, using the
effective interest rate method. Any difference between the proceeds (net of transaction costs) and the
settlement or redemption of borrowings is recognised over the term of the borrowings in accordance with the
accounting policy for borrowing costs.
Borrowings are classified as current unless the Group has an unconditional right to defer the settlement of the
liability for at least 12 months after the reporting date.
(i)
Short-term and Other Long-term Employee Benefits
A liability is recognised for benefits accruing to employees in respect of wages and salaries and annual leave
in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in
exchange for that service.
Liabilities recognised in respect of short-term employee benefits are measured at the undiscounted amount of
the benefits expected to be paid in exchange for the related service.
Liabilities recognised in respect of other long-term employee benefits are measured at the present value of the
estimated future cash outflows expected to be made by the Group is respect of services provided by employees
up to the reporting date.
(j)
Provisions
Provisions are recognised when the group has a present obligation (legal or constructive) as a result of a past
event, it is probable that the Group will be required to settle that obligation and a reliable estimate can be made
of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration
required to settle the present obligation at the reporting date, taking into account the risks and uncertainties
surrounding the obligation.
(k) Cash and Cash Equivalents
Cash and short-term deposits in the Statement of Financial Position comprise cash at bank and in hand and
short-term deposits with an original maturity of three months or less.
For the purposes of the Statement of Cash Flows, cash and cash equivalents consist of cash and cash
equivalents as defined above, net of any outstanding bank overdrafts, if any.
EQ Resources Limited Annual Report 2024
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Notes to the Consolidated Financial Statements
26
(l)
Revenue & Other Income
Revenue from contracts with customers is measured based on the consideration specified in a contract with a
customer and excludes amounts collected on behalf of third parties. The revenue is recognised when it
transfers control over a product to a customer.
Where payment is received upfront a contract liability is recognised on receipt of payment and revenue is
recognised over a period in time as product/services are delivered.
In addition to the above, the following specific recognition criteria must also be met before revenue is
recognised:
Sublease Rent
Revenue is recognised in accordance with the Retreatment Operations Sublease Agreement when the gross
value of the consideration of the minerals extracted from the subleased area has been received.
Interest
Revenue is recognised as the interest accrues (using the effective interest method, which is the rate that
exactly discounts estimated future cash receipts through the expected life of the financial instrument) to the
net carrying amount of the financial asset.
Research and Development Refundable Tax Offset
The Research and Development (R&D) Refundable Tax Offset is recognised as other income when it is
received as it relates to expenditure incurred in the past. That part of the R&D Tax Offset that relates to
capitalised expenditure recognised in a prior period (if any) is offset against that capitalised expenditure.
Government Grants
Government grant(s) are recognised when there is a reasonable assurance that the Company will comply with
the relevant conditions and that the grant will be received. If the conditions are met, the government grant is
recognised in profit or loss on a systematic basis in line with its recognition of the expenses that the grant(s)
are intended to compensate.
(m) Leases
The Group as lessee
The Group assesses whether a contract is or contains a lease, at inception of the contract. The Group
recognises a right-of-use asset and a corresponding lease liability with respect to all lease arrangements in
which it is the lessee, except for short-term leases (defined as leases with a lease term of 12 months or less)
and leases of low value assets (such a tablets and personal computers, small items of office furniture and
telephones). For these leases, the Group recognises the lease payments as an operating expense on a
straight-line basis over the term of the lease unless another systematic basis is more representative of the
time pattern in which economic benefits from the leased assets are consumed.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily
determined, the Group uses its incremental borrowing rate.
Lease payments included in the measurement of the lease liability comprise:
▪ fixed lease payments (including in-substance fixed payments), less any lease incentives receivable;
▪ variable lease payments that depend on an index or rate, initially measured using the index or rate at
the commencement date;
▪ the amount expected to be payable by the lessee under residual value guarantees;
▪ the exercise price of purchase options, if the lessee is reasonably certain to exercise the options; and
▪ payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to
terminate the lease.
Notes to the Consolidated Financial Statements continued
92
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Notes to the Consolidated Financial Statements
27
The lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease
liability (using the effective interest method) and by reducing the carrying amount to reflect the lease payments
made.
The Group remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use
asset) whenever:
▪ The lease term has changed or there is a significant event or change in circumstances resulting in a change
in the assessment of exercise of a purchase option, in which case the lease liability is remeasured by
discounting the revised leave payments using a revised discount rate.
▪ The lease payments change due to changes in an index or rate or a change in expected payment under a
guaranteed residual value, in which cases the lease liability is remeasured by discounting the revised lease
payments using an unchanged discount rate (unless the lease payments change is due to a change in a
floating interest rate, in which case a revised discount rate is used).
▪ A lease contract is modified and the lease modification is not accounted for as a separate lease, in which
case the lease liability is remeasured based on the lease term of the modified lease by discounting the
revised lease payments using a revised discount rate at the effective date of the modification.
The Group did not make any such adjustments during the periods presented.
The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments
made at or before the commencement day, less any lease incentives received and any initial direct costs. They
are subsequently measured at cost less accumulated depreciation and impairment losses.
Whenever the Group incurs an obligation for costs to dismantle and remove a leased asset, restore the site
on which it is located or restore the underlying asset to the condition required by the terms and conditions of
the lease, a provision is recognized and measured under AASB 137. To the extent that the costs relate to a
right-of-use asset, the costs are included in the related right-of-use asset, unless those costs are incurred to
produce inventories.
The right-of-use assets are presented as a separate line in the consolidated statement of financial position.
The Group applies AASB 136 to determine whether a right-of-use asset is impaired and accounts for any
identified impairment loss as described in the “Property, Plant and Equipment” policy (as outlined in the
financial report for the annual reporting period).
Variable rents that do not depend on an index or rate are not included in the measurement of the lease liability
and the right-of-use asset. The related payments are recognised as an expense in the period in which the
event or condition that triggers those payments occurs and are included in the line “Other Expenses” in profit
or loss.
As a practical expedient, AASB 16 permits a lessee not to separate non-lease components, and instead
account for any lease and associated non-lease components as a single arrangement.
(n) Taxes
Income Tax
Current tax assets and liabilities for the current and prior periods 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 reporting date.
Deferred income tax is provided on all temporary differences at reporting date between the tax bases of assets
and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences:
▪ except where the deferred income tax liability arises from the initial recognition of an asset or liability in a
transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; and
EQ Resources Limited Annual Report 2024 93
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Notes to the Consolidated Financial Statements
28
▪ in respect of taxable temporary differences associated with investments in subsidiaries, associates and
interests in joint ventures, except where the timing of the reversal of the temporary differences can be
controlled and it is probable that the temporary differences will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused
tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against
which the deductible temporary differences, the carry-forward of unused tax assets and unused tax losses can
be utilised:
▪ except where the deferred income tax asset relating to the deductible temporary difference arises from the
initial recognition of an asset or liability in a transaction that is not a business combination and, at the time
of the transaction, affects neither the accounting profit nor taxable profit or loss; and
▪ in respect of deductible temporary differences associated with investments in subsidiaries, associates and
interests in joint ventures, deferred tax assets are only recognised to the extent that it is probable that the
temporary differences will reverse in the foreseeable future and taxable profit will be available against which
the temporary differences can be utilised.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the
extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred
income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year
when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted
or substantively enacted at the reporting date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss.
Other Taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
▪ where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority,
in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense
item as applicable; and
▪ receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables
or payables in the Statement of Financial Position.
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of cash
flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation
authority is classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the
taxation authority.
(o) Currency
Both the functional and presentation currency is Australian dollars (A$).
In preparing the financial statements of the Group entities, transactions in currencies other than the entity’s
functional currency (foreign currencies) are recognised at the rates of exchange prevailing on the dates of the
transactions. At each reporting date, monetary assets and liabilities that are denominated in foreign currencies
are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are
denominated in foreign currencies are translated at the rates prevailing at the date when the fair value was
determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not
retranslated.
Notes to the Consolidated Financial Statements continued
94
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Notes to the Consolidated Financial Statements
29
Exchange differences are recognised in profit or loss in the period in which they arise except for:
▪ exchange differences on foreign currency borrowings relating to assets under construction for future
productive use, which are included in the cost of those assets when they are regarded as an adjustment to
interest costs on those foreign currency borrowings;
▪ exchange differences on transactions entered into to hedge certain foreign currency risks (see below under
financial instruments/hedge accounting); and
▪ exchange differences on monetary items receivable from or payable to a foreign operation for which
settlement is neither planned nor likely to occur in the foreseeable future (therefore forming part of the net
investment in the foreign operation), which are recognised initially in other comprehensive income and
reclassified from equity to profit or loss on disposal or partial disposal of the net investment.
(p) Investment in Subsidiaries
The parent entity’s investment in its subsidiaries is accounted for under the cost method of accounting
in the Company’s financial statements included in Note 19.
(q) Share Based Payments
Equity-settled share-based payments to employees and others providing similar services are measured at the
fair value of the equity instruments at the grant date. The fair value excludes the effect of non-market-based
vesting conditions. Details regarding the determination of the fair value of equity-settled share-based
transactions are set out in Note 29.
The fair value determined at the grant date of the equity-settled share-based payments is expensed on a
straight-line basis over the vesting period, based on the Group’s estimate of the number of equity instruments
that will eventually vest. At each reporting date, the Group revises its estimate of the number of equity
instruments expected to vest as a result of the effect of non-market-based vesting conditions. The impact of
the revision of the original estimates, if any, is recognised in profit or loss such that the cumulative expense
reflects the revised estimate, with a corresponding adjustment to reserves.
Equity-settled share-based payment transactions with parties other than employees are measured at the fair
value of the good or services received, except where fair value cannot be estimated reliably, in which case
they are measured at the fair value of the equity instruments granted, measured at the date the entity obtains
the goods or the counterparty renders the service.
For cash-settled share-based payments, a liability is recognised for the goods or services acquired, measured
initially at the fair value of the liability. At each reporting date until the liability is settled, and at the date of
settlement, the fair value of the liability is remeasured, with any changes in fair value recognised in profit or
loss for the year.
(r)
Critical Accounting Judgements, Estimates and Assumptions
The preparation of the financial statements requires management to make judgements, estimates and
assumptions that affect the reported amounts in the financial statements. Management reviews on an ongoing
basis its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses.
Management bases its judgements, estimates and assumptions on historical experience and on other various
factors, including expectations of future events, which management believes to be reasonable under the
circumstances. The resulting accounting judgements and estimates will seldom equal the related actual
results. The judgements estimates and assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
Accounting for Acquisition of Businesses
Accounting for acquisition of businesses requires judgement and estimates in determining the fair value of
acquired assets and liabilities. The relevant accounting standard allows the fair value of assets acquired to be
refined for a window of one (1) year after the acquisition date and judgement is required to ensure that any
adjustments made reflect new information obtained about facts and circumstances that existed as of the
acquisition date.
EQ Resources Limited Annual Report 2024 95
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Notes to the Consolidated Financial Statements
30
Impairment of Non-Financial Assets
The consolidated entity assesses impairment of non-financial assets at each reporting date by evaluating
conditions specific to the consolidated entity and to the particular asset that may lead to impairment. If an
impairment trigger exists, the recoverable amount of the asset is determined. This involves fair value less costs
to sell or value-in-use calculations, which incorporate a number of key estimates and assumptions. Refer to
Notes 10, 11, and 20 for further detail regarding judgements made when assessing impairment of plant and
equipment and deferred exploration and evaluation costs and determining their recoverable amount.
Measurement of Fair Values
When measuring the fair value of an asset or a liability, the Group uses observable market data as far as
possible. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in
the value in the valuation techniques as follows:
Level 1: quoted prices (unadjusted in active markets for identical assets or liabilities.
Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset of liability, directly
(ie. as prices) or indirectly (ie. derived from prices).
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
If the inputs used to measure the fair value of an asset or liability fall into different levels of the fair value
hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value
hierarchy as the lowest level input that is significant to the entire measurement.
The Group recognises transfers between levels of the fair value hierarchy at the end of the reporting period
during which the change has occurred.
Further information about the assumptions made in measuring fair values is included in the following notes:
Note 25 – Other Financial Liabilities; and
Note 28 – Financial Risk Management Objectives and Policies.
(s) Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision maker. The chief operating decision maker, who is responsible for allocating resources and
assessing performance of the operating segments, has been identified as Mr K. MacNeill, Chief Executive
Officer (CEO).
2. REVENUE AND OTHER INCOME
2024
$
2023
$
Sales and hire income
26,480,740
5,039,906
Sub-lease rent - unincorporated joint venture
302,182
69,259
Interest received – other persons/corporation
55,835
29,249
26,838,757
5,138,414
Other income:
Government wage subsidies
9,242
322,050
AMGC grant
-
190,000
CMAI grant
600,000
4,824,818
R&D tax offset
2,152,803
2,307,510
Diesel fuel rebates
711,486
336,860
Other income
14,802
-
3,488,333
7,981,238
Total revenue and other income
30,327,090
13,119,652
Notes to the Consolidated Financial Statements continued
96
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Notes to the Consolidated Financial Statements
31
3. ACQUISITION OF SUBSIDIARIES
On 18 January 2024, the Group acquired 100% of the issued share capital of Saloro S.L.U. (“Saloro”), obtaining
control of Saloro. Saloro is a Spanish company dedicated to the production and marketing of tungsten and
qualifies as a business as defined in IFRS 3 Business Combinations. Saloro was acquired as it aligned with
the Group’s corporate strategy to become a substantial and globally leading supplier of sustainably produced
critical minerals.
$
Cash consideration
2
Total purchase consideration
2
Assets and liabilities acquired at fair value:
Financial assets
12,266,801
Inventory
13,695,649
Property, plant and equipment
78,991,585
Identifiable intangible assets
-
Financial liabilities
(80,519,021)
Deferred tax assets/(liabilities)
-
Net identifiable assets and liabilities acquired
24,434,014
Bargain purchase1
24,435,012
Total consideration
2
Purchase consideration – cash inflow
Cash consideration
2
Less: cash and cash equivalents acquired
8,280,498
Total consideration transferred
8,280,496
Revenue and profit contribution from the date of acquisition to year-end
Revenue
14,195,709
Profit / (loss) after tax
(8,098,536)
1 The bargain gain arising on the Saloro acquisition is provisional pending the final valuation of the acquired net identifiable assets and
liabilities.
EQ Resources Limited Annual Report 2024 97
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Notes to the Consolidated Financial Statements
32
4. INCOME TAX
2024
$
2023
$
(a) Reconciliation of income tax expense to prima facie tax payable
Profit / (loss) before income tax
(2,129,588)
(3,716,846)
Tax at the statutory rate of 25% (30 June 2023: 25%)
(532,397)
(929,212)
Tax effect of amounts which are not taxable in calculating taxable income:
Non-deductible expenses
2,134,981
1,418,709
Non-assessable income
(6,932,501)
(586,734)
Deferred tax assets not recognised
5,329,917
97,236
Income tax benefit
-
-
(b) Unrecognised deferred tax assets
Balance at beginning of year
5,330,712
4,511,295
Current year not recognised
5,624,283
180,749
Adjustments in respect of prior year tax balances
(932,101)
638,668
Balance at end of year
10,022,894
5,330,712
Deferred tax assets have not been recognised in respect of the following items:
Tax losses
14,279,183
9,772,349
Less: other timing differences
(4,256,289)
(4,441,637)
Net deferred tax assets
10,022,894
5,330,712
No income tax provision is considered necessary for the Company for the period ending 30 June 2024.
Deferred tax assets have not been recognised in respect of these items because it is not probable that these
assets will be realised in the short to medium term. The Group has total tax losses at 30 June 2024 of
$57,116,716 (2023: $39,089,398). A future income tax benefit which may arise from tax losses of 25% of
approximately $14,279,179 will only be obtained if:
▪ the parent and the subsidiaries derive future assessable income of a nature and of an amount sufficient to
enable the benefit from the deductions for the losses to be realised;
▪ the parent and the subsidiaries continue to comply with the conditions for deductibility imposed by the law;
and
▪ no changes in tax legislation adversely affect the Parent and the Subsidiaries in realising the benefit from
the deductions for the losses, i.e. current tax legislation permits carried forward tax losses to be carried
forward indefinitely.
No franking credits are available for subsequent years.
Tax consolidation
The tax consolidation scheme applies to the Company. As at the date of this report the Directors have
assessed the financial effect the scheme may have on the Company and its consolidated entities and have
decided to be taxed as a consolidated entity. The financial effect of the tax consolidation scheme on the Group
has not been recognised in the financial statements.
Notes to the Consolidated Financial Statements continued
98
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Notes to the Consolidated Financial Statements
33
5. INVENTORY
2024
$
2023
$
Current
Finished goods2
1,454,731
341,447
Work-in-progress2
12,152,075
218,517
Raw materials
19,064
39,094
Workshop inventory
3,519,132
278,682
17,145,002
877,740
Non-current
Finished goods
Raw materials1
1,789,426
6,369,702
1,690,023
6,523,633
8,159,128
8,213,656
25,304,130
9,091,396
1 Raw materials incorporate the fair value of the estimated 7 million tonnes of stockpiled inventory acquired as part of the
acquisition of Mt Carbine Quarries Pty Ltd on 28 June 2019, along with the work-in-progress and finished goods inventory
which have been created from this stockpiled material since acquisition.
2 Finished goods and work-in-progress incorporate the fair value of 767,663 tonnes of ROM inventory plus 2,477 mtu (mtu
= 10kg of WO3) of tungsten concentrate produced but not sold of year-end acquired as part of the acquisition of Saloro
on 18 January 2024.
Inventory is consumed on a units of operation basis in accordance with AASB102. All inventory, regardless of
type and stage in the production process has been valued at the lower of cost and net realisable value (NRV).
Inventories expected to be processed or sold within twelve months after the balance sheet date are classified
as current assets. All other inventories are classified as non-current assets.
The cost of inventories recognised as an expense do not include any write-downs of inventory to NRV.
6. FINANCIAL ASSETS
2024
$
2023
$
Shares in listed companies:1
Critical Resources Limited (ASX: CRR)
1,160
5,156
1,160
5,156
Capitalised borrowing costs:2
Current
90,117
108,417
Non-current
556,096
200,084
646,213
308,501
Unexpired interest:2
Current
678,582
707,232
Non-current
2,081,492
2,133,500
2,760,074
2,840,732
Deferred acquisition costs:3
Current
72,274
-
Non-Current
1,180,185
221,729
1,252,459
221,729
4,659,906
3,376,118
1 Equity instruments are measured at fair value as at reporting date with all changes recognised as other comprehensive income / (loss)
in the Consolidated Statement of Profit or Loss and Other Comprehensive Income.
2
During the reporting period, the Company entered into a Royalty Funding Package with Regal Resources Royalties Fund, with the
Group receiving $10 million in two separate tranches. The financing consists of a royalty percentage of 3% with a buy-back option
after the recovery of the first stage royalty, $10 million (and before the 7th anniversary of the definitive agreement execution) and a
payment of $2.75 million, reducing the liability to 1.5% for life of the Mt Carbine Mine.
EQ Resources Limited Annual Report 2024 99
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Notes to the Consolidated Financial Statements
34
The capitalised borrowing costs represent those costs directly attributable to securing this funding package and will be amortised over
the period in which the first stage royalty of $10 million will be repaid.
The unexpired interest component will be recognised over the life of mine in line with each of the scheduled periodic repayments to
Regal Resources Royalties Fund. A discounted cash flow method using a discount rate of 5.455% (2021: n/a) was used to capture
the net present value of the revenues for the life of mine as determined in the May 2023 Update of the BFS.
3
Deferred acquisition costs represent those costs directly attributable to the acquisition of Saloro on 18 January 2024. These costs will
be amortised over the life of mine.
7. AUDITOR’S REMUNERATION
2024
$
2023
$
Audit-related services
Amounts paid or payable:
- Nexia Melbourne Audit Pty Ltd
176,245
88,680
- Deloitte, Spain
25,671
-
Taxation services
Amounts paid or payable:
- Nexia Melbourne Pty Ltd
27,634
16,700
- Deloitte, Spain
65,793
-
295,343
105,380
8. TRADE AND OTHER RECEIVABLES
2024
$
2023
$
Trade receivables
6,733,194
2,495,980
Less: Allowance for doubtful debts
(10,634)
(549)
6,722,560
2,495,431
Other taxation
3,516,956
808,648
Other receivables - related entities
5,531,580
-
Other receivables – other persons/corporation
710,988
629,533
Total trade & other receivables
16,482,084
3,933,612
Prepayments
656,636
634,064
Trade Receivables
Average credit period on sales of product is 30 days. No interest is charged on outstanding trade receivables.
The collectability of trade receivables is assessed continuously, and individual receivables are written off when
management deems them unrecoverable. A provision has been made for those receivables whose recovery
was deemed doubtful as at reporting date.
Other Receivables – Related Entities
Receivables from related entities represent the Company’s 50% portion of loans provided to the
unincorporated joint venture since its inception. These loans are unsecured and non-interest bearing and are
recorded as a current asset pending the acquisition by EQR of CR Australia’s joint venture interest in the Mt
Carbine Retreatment Joint Venture (refer ASX Announcement “EQR Executes Definitive Agreement to Acquire
Mt Carbine Retreatment Joint Venture Interest from Cronimet” dated 5 July 2024).
Notes to the Consolidated Financial Statements continued
100 EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
35
9. RECEIVABLES
2024
$
2023
$
Receivables from related entities
-
3,306,742
Tenement security deposits
1,189,102
1,172,598
Other security deposits
59,165
8,100
1,248,267
4,487,440
Tenement deposits are restricted in that they are available for rehabilitation that may be required on the mining
leases and/or exploration tenements (refer to Notes 17 and 18).
Receivables from related entities relate to the Company’s 50% portion of loans provided to the unincorporated
joint venture, which have been reclassified as current during the reporting period (refer Note 8).
10. PLANT AND EQUIPMENT AT COST
Land &
Buildings
Plant &
Machinery
Mine Assets
Capital works
in progress
Total
Cost at 1 July 2023
131,552
11,867,434
-
5,835,146
17,834,132
Additions
222,231
3,481,714
9,712,485
1,421,860
14,838,290
Acquisition of subsidiary
13,387,757
61,144,444
923,508
1,429,544
76,885,253
Disposals
-
(430,786)
-
-
(430,786)
Cost at 30 June 2024
13,741,540
76,062,806
10,635,993
8,686,550
109,126,889
Comprising:
Cost at 30 June 2024
13,741,540
76,062,806
10,635,993
8,686,550
109,126,889
Accumulated depreciation at 1 July 2023
(648)
(3,818,529)
-
-
(3,819,177)
Charge for the year
(695,260)
(5,051,382)
(398,837)
-
(6,145,479)
Eliminated on disposal
-
361,501
-
-
361,501
Cost at 30 June 2024
13,045,632
67,554,396
10,237,156
8,686,550
99,523,735
11. DEFERRED EXPLORATION AND EVALUATION
2024
$
2023
$
Costs brought forward
14,273,131
10,803,974
Costs incurred during the period
1,934,696
3,640,380
Capitalised portion of R&D tax offset
(24,462)
(39,427)
Total deferred exploration and evaluation
16,183,365
14,404,927
Amortisation deferred exploration and evaluation
(1,261,246)
(131,796)
Costs carried forward
14,922,119
14,273,131
Exploration expenditure costs carried forward are made up of:
Expenditure on joint venture areas
-
-
Expenditure on non-joint venture areas
14,922,119
14,273,131
Costs carried forward
14,922,119
14,273,131
The above amounts represent costs of areas of interest carried forward as an asset in accordance with the
accounting policy set out in Note 1. The ultimate recoupment of deferred exploration and evaluation
expenditure in respect of an area of interest carried forward is dependent upon the discovery of commercially
viable reserves and the successful development and exploitation of the respective areas or alternatively sale
of the underlying areas of interest for at least their carrying value. Amortisation, concerning the relevant area
of interest, is not charged until a mining operation has commenced.
The Directors reassess the carrying value of the Group’s tenements at each half year or at a period other than
that, should there be any indication of impairment.
EQ Resources Limited Annual Report 2024 101
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
36
Farm-In and Joint Venture Agreement – NSW Projects
EQ Resources Limited entered into a binding Farm-In and Joint Venture Agreement with Sozo Resources Pty
Ltd (“Sozo”) in November 2021 whereby Sozo can earn up to an 80% interest in EQR’s 100% owned NSW
projects, Crow Mountain (EL6648) and Panama Hat (EL8024), by completing expenditure of $1.6 million over
4 years as follows:
▪ Stage 1 – Sozo to complete $100K of expenditure within 9 months from the Agreement’s Commencement
date;
▪ Stage 2 – Sozo will spend a further $750K within 24 months to earn a 49% interest. If Sozo elects to
continue sole funding exploration expenditure at the end of Stage 2, it will have earned a further 2% (51%
in total), and a Joint Venture will be formed and
▪ Stage 3 – Sozo is to spend a further $750K of expenditure and complete a Scoping Study (as defined by
the 2012 JORC Code) within a further 24 months to earn a further 29% (in total $1.6M for 80%).
Sozo Resources has successfully completed the Stage 1 Farm-In Conditions and has elected to proceed to
Stage 2 Farm-In, providing Sozo the exclusive right to earn a 49% legal and beneficial interest in the Joint
Venture gold properties subject to conditions.
12. TRADE AND OTHER PAYABLES
2024
$
2023
$
PAYABLES
Trade payables
31,992,515
3,489,058
Other taxation
497,830
779,477
Unearned revenue
805,920
461,247
Accrued expenses
2,403,296
1,678,556
Other Payables - other persons/corporation
5,443,290
4,901,516
Other payables – related entities
1,504,263
-
42,647,114
11,309,854
Payables from related entities represent the Company’s 50% portion of loans payable to the unincorporated
joint venture since its inception. These loans are unsecured and non-interest bearing and are recorded as a
current asset pending the acquisition by EQR of CR Australia’s joint venture interest in the Mt Carbine
Retreatment Joint Venture (refer ASX Announcement “EQR Executes Definitive Agreement to Acquire Mt
Carbine Retreatment Joint Venture Interest from Cronimet” dated 5 July 2024).
13. ISSUED CAPITAL
2024
$
2023
$
Share Capital
1,787,288,465 (2023: 1,474,486,938) ordinary shares fully paid
43,031,133
27,376,334
278,000,000 (2023: Nil) ordinary shares fully paid under escrow
25,307,296
-
68,338,429
27,376,334
Notes to the Consolidated Financial Statements continued
102 EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
37
(a) Movements in Ordinary Share Capital
1 July 2023 to 30 June 2024
Date
Number of
Shares
Issue Price
$
Balance b/fwd
1,474,486,938
27,222,060
Issue of 957,055 shares @ $0.0650 per share upon the conversion
of unlisted options granted to sophisticated investors (refer ASX
announcement dated 11 August 2023)
11/08/2023
957,055
$0.07
62,208
Issue of 4,698,617 shares @ $0.0650 per share upon the conversion
of unlisted options granted to sophisticated (refer ASX announcement
dated 23 August 2023)
23/08/2023
4,698,617
$0.07
305,410
Issue of 3,125,000 shares @ $0.0650 per share upon the conversion
of unlisted options granted to sophisticated (refer ASX announcement
dated 6 September 2023)
6/09/2023
3,125,000
$0.07
203,125
Issue of 25,000,000 shares @ $0.0650 per share upon the exercise
of unlisted options granted to sophisticated investors (refer ASX
announcement dated 22 September 2023)
22/09/2023
25,000,000
$0.07
1,625,000
Issue of 16,730,321 shares @ $0.0650 per share on the conversion
of 4,000,000 convertible notes (refer ASX announcement dated 28
September 2023)
28/09/2023
61,538,463
$0.04
4,000,000
Issue of 5,000,000 shares @ $0.0600 per share to upon the exercise
of options granted to Key Management Personnel (refer ASX
announcement dated 8 November 2023)
8/11/2023
5,000,000
$0.06
300,000
Issue of 278,000,000 shares @ $0.0900 per share as part of
placement with Oaktree Capital Management, L.P. Escrowed to 18
January 2024 (refer ASX announcement dated 18 January 2024)
18/01/2024
278,000,000
$0.09
25,307,297
Issue of 1,000,000 shares @ $0.0400 per share upon the exercise of
unlisted options granted to employees (refer ASX announcement
dated 1 May 2023)
2/02/2024
1,000,000
$0.04
40,000
Issue of 5,000,000 shares @ $0.0432 per share upon the exercise of
unlisted options granted to sophisticated investors (refer ASX
announcement 20 March 2024)
20/03/2024
5,000,000
$0.04
216,000
Issue of 205,940,008 shares @ $0.0450 per share to sophisticated
investors as part of the May 2024 placement (refer ASX
announcement dated 29 May 2024)
29/05/2024
205,940,008
$0.05
9,269,999
Issue of 542,384 shares @ $0.0461 per share for Senior Financial
Advisor Service Fees (refer ASX announcement dated 28 June 2024)
28/06/2024
542,384
$0.05
25,004
Fair value of options exercised
962,893
Share issue costs
(1,200,567)
Balance as at 30 June 2024
2,065,288,465
68,338,429
1 July 2022 to 30 June 2023
Date
Number of
Shares
Issue Price
$
Balance b/fwd
1,344,186,938
22,192,705
Issue of 25,000,000 shares @ $0.040 per share to sophisticated
investors as part of the October 2022 share placement (refer ASX
announcement dated 7 November 2022)
07/11/2022
25,000,000
$0.040
1,000,000
Issue of 47,670,615 shares @ $0.040 per share to sophisticated
investors as part of the October 2022 share placement (refer ASX
announcement dated 10 November 2022)
10/11/2022
47,670,615
$0.040
1,906,825
Issue of 19,599,064 shares @ $0.040 per share to sophisticated
investors as part of the October 2022 share placement (refer ASX
announcement dated 14 November 2022)
14/11/2022
19,599,064
$0.040
783,962
Issue of 16,730,321 shares @ $0.040 per share to sophisticated
investors as part of the October 2022 share placement (refer ASX
announcement dated 15 November 2022)
15/11/2022
16,730,321
$0.040
669,213
Issue of 6,300,000 shares @ $0.040 per share to convertible note
holders for annual interest payable on the convertible notes (refer
ASX announcement dated 21 November 2022)
21/11/2022
6,300,000
$0.040
252,000
EQ Resources Limited Annual Report 2024 103
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
38
1 July 2022 to 30 June 2023
Date
Number of
Shares
Issue Price
$
Issue of 5,000,000 shares @ $0.040 per share to sophisticated
shareholders, approved by shareholders on 25 January 2023, as part
of the October 2022 placement (refer ASX announcement dated 1
February 2023)
01/02/2023
5,000,000
$0.040
200,000
Issue of 2,000,000 shares @ $0.040 per share upon the exercise of
unlisted options granted to Key Management Personnel (refer ASX
announcement dated 1 May 2023)
01/05/2023
2,000,000
$0.040
80,000
Issue of 3,000,000 shares @ $0.060 per share upon the exercise of
unlisted options granted to Key Management Personnel (refer ASX
announcement 16 May 2023)
16/05/2023
3,000,000
$0.060
180,000
Issue of 2,000,000 shares @ $0.040 per share upon the exercise of
unlisted options (refer ASX announcement dated 26 June 2023)
26/06/2023
2,000,000
$0.040
80,000
Issue of 3,000,000 shares @ $0.060 per share upon the exercise of
unlisted options (refer ASX announcement dated 26 June 2023)
26/06/2023
3,000,000
$0.060
180,000
Share issue costs
(302,645)
Balance as at 30 June 2023
1,474,486,938
27,222,060
Terms and Conditions of Contributed Equity
Ordinary Shares
Ordinary shares have the right to receive dividends as declared and, in the event of winding up the Company,
to participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts
paid up on the shares held.
Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
Option holders have no voting rights until the options are exercised.
(b) Movements in Share Options
The following table illustrates share based payments, the number and weighted average exercise prices
(WAEP) of, and movements in, share options during the year:
Number
WAEP
$
Balance at 1 July 2023
130,782,346
0.060
7,836,852
Options recognised as share-based payments expense
163,046,721
0.086
14,073,654
Options recognised as share issue costs
20,000,000
0.068
1,350,000
Forfeited/cancelled
(1,300,000)
(0.054)
(70,000)
Exercised
(44,780,672)
(0.061)
(2,751,744)
Expired
(64,000,000)
(0.045)
(2,849,207)
Balance at 30 June 2024
203,748,395
0.086
17,589,555
The following table illustrates outstanding options that have vested and are exercisable at year end:
Number
outstanding
Number vested
and exercisable
Exercise price
Expiry Date
Remaining
Contractual
Life (Years)
Issue EQRAL
19,751,674
19,751,674
0.0650
07/11/25
1.36
Issue EQRAM
16,100,000
-
0.0650
03/07/26
2.01
Issue EQRAN
1,250,000
1,250,000
0.0650
31/01/26
1.59
Issue EQRAO
78,000,000
78,000,000
0.0100
18/01/26
1.55
Issue EQRAP
88,646,721
88,646,721
0.0675
29/05/27
2.91
Outstanding at 30 June 2024
203,748,395
187,648,395
Notes to the Consolidated Financial Statements continued
104 EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
39
(c) Movements in Performance Rights
No performance rights were issued nor outstanding at the end of the reporting period.
14. CONVERTIBLE NOTES
On 17 September 2021, the Company issued 6,000,000 convertible notes with an aggregate principal value
of $6,000,000. Subsequent to this issue, 2,000,000 notes plus accrued interest were converted into 30,832,307
ordinary shares on 29 and 30 September 2021.
On 28 September 2023, the noteholders opted to fully exercise the convertible notes into EQR ordinary shares
at a conversion price of $0.065 per share.
The fair value of the liability component was estimated at the issuance date using an “Interest Rate Differential”
methodology, which discounts the convertible notes’ cash flows at a commercial discount (interest) rate to a
present value. The residual amount is assigned as the equity component and is included in reserves.
A further issuance of $750,000 convertible notes occurred on 6 November 2023 with an aggregate principal
value of $750,000. The notes are convertible at the option of the noteholders into ordinary shares at a
conversion price of $0.100 per share at any time after issuance and up to the close of business on the maturity
date.
Noteholders have an option to redeem the notes at the end of 2 years at face value plus any accrued interest.
Any convertible notes not converted will be redeemed on 6 November 2025 at the principal amount together
with accrued but unpaid interest thereon. The notes carry interest at a coupon rate of 9.00% per annum
(effective interest rate of 0.86% per month based on a 2-year amortisation period on estimated cashflow timing
in line with the 2-year redemption option), which is payable annually in arrears. The convertible notes issued
and converted during the period have been split into liability and equity components as follows:
Debt ($)
Equity ($)
Number
Opening balance at 1 July 2023
2,852,667
1,147,333
4,000,000
Nominal value of convertible notes issued
525,000
225,000
750,000
Notes converted during the period
(2,852,667)
(1,147,333)
(4,000,000)
Balance as at 30 June 2024
525,000
225,000
750,000
Debt Component – Convertible Notes
2024
$
Opening balance at 1 July 2023
3,494,215
Convertible note issue on 6 November 2023
525,000
Accrued interest at an effective interest rate
199,828
Interest paid at coupon rate
(280,000)
Capitalised borrowing costs
28,150
Liability derecognition upon conversion
(3,422,556)
Balance as at 30 June 2024
544,637
2023
Debt Component – Convertible Notes
$
Opening balance at 1 July 2022
3,004,651
Accrued interest at an effective interest rate
586,963
Interest paid at coupon rate
(280,000)
Capitalised borrowing costs
182,601
Balance as at 30 June 2023
3,494,215
EQ Resources Limited Annual Report 2024 105
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
40
Accounting Policy
The component of convertible notes that exhibits characteristics of a liability is recognised as a liability in the
Statement of Financial Position, net of transaction costs. The increase in liability due to the passage of time is
recognised as a finance cost. The remainder of the proceeds are included in shareholders’ equity, net of
transaction costs. The carrying amount of the conversion option is not remeasured in subsequent years.
Transaction costs are apportioned between the liability and equity components of the convertible notes based
on the allocation of proceeds to the liability and equity components when the instruments are first recognised.
The liability component of the convertible notes has been classified as a current liability in accordance with
AASB 101 Amendments to Australian Accounting Standards – Classification of Liabilities as Current or Non-
Current due to the Company not having a right to defer settlement for at least twelve months after the reporting
period.
15. EARNINGS PER SHARE
2024
$
2023
$
Loss after income tax attributable to the owners of the Company used in calculating basic and
diluted earnings per share
(2,129,588)
(3,716,846)
Number
Number
Weighted average number of ordinary shares on issue used in the calculation of basic loss per
share
1,696,757,002
1,420,196,670
Weighted average number of ordinary shares used in calculating diluted earnings per share. Note
options outstanding at the reporting date have not been brought to account as they are anti-
dilutive.
1,886,732,213
1,547,960,515
Basic loss per share (cents)
(0.13)
(0.26)
Diluted loss per share (cents)
(0.11)
(0.24)
16. KEY MANAGEMENT PERSONNEL COMPENSATION
2024
$
2023
$
Short-term employee benefits
543,647
533,652
Post-employment benefits
-
-
Share based payments
29,651
120,830
573,298
654,482
17 CONTINGENT LIABILITIES
The Group has provided guarantees totalling $1,172,598 in respect of mining exploration tenements and
environmental bonds. These guarantees in respect of mining and exploration tenements are secured against
deposits with the relative State Department of Mines. The Company does not expect to incur any material
liability in respect of the guarantees.
18. COMMITMENTS
Exploration Licence Expenditure Requirements
Queensland
The Queensland Government has approved a number of changes to Exploration Permits under the Natural
Resources and Other Legislation Amendment Act 2019 (known as NROLA Act). This Act commenced in May
2020, resulting in a change from an expenditure-based approach upon which a company’s compliance with its
licence conditions will be assessed on an outcomes-based approach.
Notes to the Consolidated Financial Statements continued
106 EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
41
New South Wales
In November 2021, EQ Resources Limited entered into a binding Farm-In and Joint Venture Agreement with
Sozo Resources Pty Ltd (“Sozo”) whereby Sozo can earn up to an 80% interest in EQR’s 100% owned NSW
projects, Crow Mountain (EL6648) and Panama Hat (EL8024), by completing expenditure of $1.6 million over
4 years as follows:
▪ Stage 1 – Sozo to complete $100K of expenditure within 9 months from the Agreement Commencement
Date;
▪ Stage 2 – Sozo is to spend a further $750K of expenditure within an additional 24 months to earn a 49%
interest. If Sozo elects to continue sole funding exploration expenditure at the end of Stage 2, it will have
earned a further 2% (51% in total), and a Joint Venture will be formed; and
▪ Stage 3 – Sozo is to spend a further $750K of expenditure and complete a Scoping Study (as defined by
the 2012 JORC Code) within an additional 24 months to earn a further 29% (in total, $1.6M for 80%).
For further details, refer to ASX announcement “EQR Farms-Out NSW Projects to Focus on Mt Carbine
Tungsten Mine” dated 26 November 2021.
This agreement ensures that the Company’s minimum expenditure requirements, as shown in the table below,
will be satisfied in order to maintain each tenement in good standing.
2024
$
2023
$
Payable not later than 1 year (NSW only)
-
118,000
Payable later than one year but not later than two years
160,000
160,000
160,000
278,000
It is also likely that the granting of new licences and changes in licence areas at renewal or expiry will change
the expenditure commitment of the Group from time to time.
19. INVESTMENT IN SUBSIDIARIES
Equity Interest
Cost of Parent Entity’s
Investment
Parent Entity
EQ Resources Limited
2024
%
2023
%
2024
$
2023
$
Controlled Entities
Mt Carbine Mining Pty Ltd
100
100
2
2
Mt Carbine Retreatment Pty Ltd
100
100
200
200
European Tungsten Pty Ltd2
100
100
1
1
Mt Carbine Quarrying Operations Pty Ltd
100
100
100
100
Mt Carbine Quarries Pty Limited
100
100
8,130,000
8,130,000
Icon Resources Africa Pty Ltd
100
100
10
10
Mt Carbine Retreatment Management Pty Ltd1
50
50
50
50
Saloro S.L.U.
100
-
2
-
1
Mt Carbine Retreatment Management Pty Ltd is the agent for the unincorporated joint venture between Mt Carbine Retreatment Pty
Ltd and CRONIMET Australia Pty Ltd.
2 Formerly Troutstone Pty Ltd and is the holding company for Saloro.
EQ Resources Limited and all its subsidiaries are located and incorporated in Australia except Saloro, wholly
owned by European Tungsten Pty Ltd, domiciled in Spain.
20. IMPAIRMENT OF DEFERRED EXPLORATION EXPENDITURE AND PLANT AND
EQUIPMENT
The Directors reassess the carrying value of the Group’s assets, including deferred exploration expenditure,
tenements and plant and equipment at each half year or at a period other than that, should there be any
indication of impairment to fair value. When making their assessment for the 2024 financial year, the Directors
considered the following:
EQ Resources Limited Annual Report 2024 107
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
42
▪ The commencement of open-cut mining operations in July 2023 with the May 2023 Bankable Feasibility
Study Update delivering the following strong Pre-Tax Economics* for the Mt Carbine Expansion Program:
–
NPV8 of $307.1 million (47% increase compared to the November 2022 BFS update of $209 million);
–
IRR of 477%; and
–
Life of Mine EBITDA of $450 million.
1 Concentrate sales price basis US$340/mtu (mtu = metric tonne unit, 10kg) in 2023, with a long-term forecast average of US $369/mtu
(2024 – 2040) calculated using the average of the Roskill Base Case and High Case price level scenarios (see Chapter 16 of 2021
BFS).
▪ Mt Carbine Infill Drilling revealing additional high-grade ore in the Stage II Andrew White Open Pit waste
cutback area, which was previously undrilled and considered waste.
▪ New JORC 2012 compliant Mineral Resource Estimate (“MRE”) updating Saloro’s historical resource
statement added 4.74M mtu (mtu = 10kg WO3) to EQR’s resource inventory. With 78% of the Saloro MRE
being in the Indicated and Measured Category, it provides great confidence to the project's longevity.
▪ Completion of a 511m percussion drill program at the Telephone Line Prospect at Panama Hat (EL 8024)
conducted by Sozo Resources Pty Ltd (“Sozo”) in line with the Farm-In and Joint Venture Agreement
entered into between the Company and Sozo in November 2021.
▪ The Company’s wholly owned subsidiary, Mt Carbine Quarrying Operations Pty Ltd, continuing to dedicate
resources to developing its ‘green aggregates’ business to enable the repurposed Mt Carbine aggregates
to be classified as a recycled product. This will open additional opportunities in both local and regional
markets, potentially increasing future sales as regional industries demand more recycled products. The
Company continues to submit tenders for substantial civil projects in the Quarry’s operational area, all of
which are dependent upon either Federal or State funding.
▪ The Company continues to hold:
–
Two (2) gold prospects in NSW and has entered into Farm-In and Joint Venture Agreement (the
“Agreement”) executed with Sozo Resources Pty Ltd (“Sozo”) whereby Sozo can earn up to an 80%
interest in EQR’s Panama Hat and Crow Mountain Projects (EL’s 6648 and 8024) by completing
expenditure of A$1.6M over 4 years.
As announced on 8 May 2023, Sozo Resources has successfully completed the Stage 1 Farm-In
Conditions and has elected to proceed to Stage 2 Farm-In, providing Sozo the exclusive right to earn
a 49% legal and beneficial interest in the Joint Venture gold properties subject to conditions.
–
Three (3) tungsten-focused Exploration Permits, EPM 27394, EPM 14871 and EPM 14872, located at
Mt Carbine, North Queensland. EPM 14872 contains both the Iron Duke and Petersen’s Lode
prospects, whilst EPM 14871 features the Mt Holmes tin-tungsten prospect.
EPM 14872 holds significant exploration upside given that the tungsten grades indicated in
the sampling of the Iron Duke and Petersen’s Lode are extensively higher than the estimated global
average grade in the present open-pit resource within the Mt Carbine Mining Leases. These
unencumbered, greenfield sites also offer the added advantage of having minimal environmental
legacy issues.
Based on the above, Directors have assessed there to be no indication of impairment in the current financial
year.
Notes to the Consolidated Financial Statements continued
108 EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
43
Combined Deferred Expenditure, Plant and Equipment and Financial Assets
2024
$
2023
$
Non-current assets
Receivables
1,248,267
4,487,440
1,248,267
4,487,440
Plant and equipment
Plant and equipment – at cost
105,669,214
15,307,239
Accumulated depreciation
(6,145,479)
(1,292,283)
99,523,735
14,014,956
Inventory
Inventory – Quarry Material
8,159,128
8,812,714
Inventory – Workshop
-
278,682
8,159,128
9,091,396
Deferred exploration and evaluation expenditure
Exploration and evaluation expenditure
16,183,365
14,554,304
Tenement and other security deposits – increase / (decrease)
-
99,406
Amortisation
(1,261,246)
(380,579)
14,922,119
14,273,131
TOTAL
123,853,249
41,866,923
Reconciliation of the carrying amount of Mt Carbine assets at the beginning and end of the
current and previous financial year:
2024
$
2023
$
Combined assets carrying amount at the beginning of the year
41,866,923
26,590,574
Receivables – increase / (decrease)
(3,239,173)
3,306,742
Plant and equipment – additions
14,838,290
8,470,929
Plant and equipment – acquisition of subsidiary
76,885,253
Plant and equipment – WDV of disposals
(69,285)
(179,685)
Plant and equipment – depreciation expense
(6,145,479)
(1,292,283)
Inventory – increase / (depletion)
(932,268)
1,402,083
Tenement & other security deposits – increase
-
99,406
Capitalised exploration and evaluation expenses
1,934,696
3,640,380
Capitalised exploration and evaluation expenses - R&D Tax Offset
(24,462)
(39,427)
Capitalised exploration and evaluation – amortisation
(1,261,246)
(131,796)
TOTAL
123,853,249
41,866,923
21. SUBSEQUENT EVENTS
There have been no material events subsequent to 30 June 2024 that have not previously been reported other
than:
▪ The execution of a definitive agreement to acquire CRONIMET’s joint venture interest (being the remaining
50% not yet owned by EQR) in the Mt Carbine Retreatment JV. Refer ASX announcement “EQR Executes
Definitive Agreement to Acquire Mt Carbine Retreatment Joint Venture Interest from Cronimet” dated 5 July
2024.
▪ Completion of a further 37 holes on Infill RC Drilling at 10m spacing into the Main Vein Packages at Mt
Carbine, totalling 1,437m of drilling which revealed serval high-grade intersections (internals are down hole
intercepts sampled at 1m intervals and then composited). Refer ASX announcement “High-Grade Drilling
Result at Mt Carbine” dated 29 July 2024.
▪ Golding Contractors Pty Ltd (Golding) was engaged by EQ Resources Limited, Mt Carbine Mining Pty Ltd
and Mt Carbine Quarries Pty Ltd under a Mining Services Agreement for Mount Carbine dated on or around
26 May 2023 (Contract). Upon termination of the Contract, the parties agreed to settle all outstanding
payables owed to Golding by way of a repayment schedule, with payments to be completed over the course
of the reminder of the current financial year.
EQ Resources Limited Annual Report 2024 109
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
44
The owner-operator model will result in cost savings, operational control, and mining flexibility whilst
upskilling EQR’s local workforce. The Company is also fortunate to have the key management personnel
running the mining and engineering departments transition to become EQR employees. Refer ASX
announcement “Mt Carbine Transitions to Owner-Operator Mining” dated 16 August 2024.
▪ Strategic collaboration and long-term offtake contract entered into between EQR and Elmet Technologies
LLC (“Elmet”). Elmet will purchase tungsten concentrate with an estimated value of A$30 million (at current
market prices) over 5 years and will secure the offtake allocation through an advance payment of A$2.0
million. In recognition of the parties’ intent to collaborate, EQR will grant Elmet 20,000,000 options with an
exercise price of $0.10 and an expiry date of 2 years. Refer ASX announcement “EQR and Elmet
Technologies Agree to a Strategic Collaboration and Long-Term Offtake Contract” dated 2 September
2024.
22. STATEMENT OF CASH FLOWS
23. CONTRACT LIABILITIES
2024
$
2023
$
Contract Liability - Sublease1
Current
1,466,669
1,768,851
Non-current
-
-
1,466,669
1,768,851
Contract Liability - Offtake2
Balance at the beginning of the year
4,901,961
3,266,190
Plus: Offtake extension (final drawdown)
-
1,482,960
Less: Unrealised foreign exchange (gain) / loss
4,440
152,811
4,906,401
4,901,961
1
Mt Carbine Sublease Rent prepaid to Mt Carbine Quarries Pty Ltd as per the Retreatment Operations Sublease Agreement between
Mt Carbine Quarries Pty Ltd, CRONIMET Australia Pty Ltd and Mt Carbine Retreatment Pty Ltd.
Reconciliation of net cash outflow from operating activities to operating loss after
income tax
2024
$
2023
$
(a) Operating loss after income tax
(2,129,588)
(3,716,846)
Depreciation and amortisation
7,166,812
1,424,079
Share based payments expense
3,539,925
674,837
Amortised finance expense
1,838,451
1,072,449
Gain on disposal of assets
-
-
Loss on disposal of assets
(2,718)
119,352
(Revaluation) Devaluation of investment to market value
(26,129,294)
387
Unrealised foreign exchange (gains) losses
(219,651)
221,964
R&D tax offset capitalisation
24,462
39,427
Change in assets and liabilities:
Decrease (Increase) in receivables
(7,067,497)
(6,349,632)
Decrease (Increase) in other assets
(21,030,287)
(322,694)
Increase/(decrease) in trade and other creditors
31,305,831
5,444,049
Net cash outflow from operating activities
(12,703,554)
(1,392,628)
(b) For the Statement of Cash Flows, cash includes cash on hand at the bank, deposits, and
bills used as part of the Company’s cash management function. The Company does not have
any unused credit facilities.
The balance at 30 June comprised:
Cash assets
3,489,532
5,335,596
Cash on hand
3,489,532
5,335,596
Notes to the Consolidated Financial Statements continued
110
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
45
2
The Company’s wholly owned subsidiary and 50% unincorporated joint venture partner, Mt Carbine Retreatment Pty Ltd’s, Offtake
Advance recognition. The Loan is denominated in USD and the Offtake Advance Agreement between CRONIMET Asia Pte Ltd,
CRONIMET Australia Pty Ltd and Mt Carbine Retreatment Pty Ltd governs the terms and repayment of this advance.
A further offtake prepayment facility of US $3 million was secured from the Company’s joint venture and offtake partner, CRONIMET
Asia Pte Ltd, with US $1 million of this additional facility being drawn as at 30 June 2022 (refer ASX Announcement “CAPEX Funding
for Mt Carbine Expansion Secured” dated 2 May 2022). Note: The Company’s wholly owned subsidiary and 50% unincorporated joint
venture partner, Mt Carbine Retreatment Pty Ltd, interest in the offtake prepayment equates to 50% of the total prepayment facility.
The contract liability arrangements for the Offtake Advance are secured as follows:
▪ general security deed from Mt Carbine Retreatment Pty Ltd over its present and subsequent acquired
assets;
▪ general security deed from CRONIMET Australia Pty Ltd over all its present and subsequent acquired
assets; and
▪ mortgage from Mt Carbine Quarries Pty Ltd over mining leases ML4867 and ML4919. This mortgage also
includes an interest over “Featherweight Property”, which is all other property of Mt Carbine Quarries Pty
Ltd other than the mining leases. The mortgage is limited recourse in that it is limited to the value of the
mining leases.
The contract liability arrangement for the unincorporated joint venture between Mt Carbine Retreatment Pty
Ltd and CRONIMET Australia Pty Ltd (Joint Venture) is as follows:
▪ Deed of Cross Security between the Joint Venture parties and Mt Carbine Retreatment Management Pty
Ltd (as the manager), which secures the performance of their obligations to each other under the Joint
Venture; and
▪ General Security Deed from Mt Carbine Quarries Pty Ltd in favour of the Joint Venture parties over all
present and after acquired property of Mt Carbine Quarries Pty Ltd including its rights under the Mining
Leases.
24. BORROWINGS
2024
$
2023
$
Unsecured borrowing at amortised cost
Loan from related parties
1,798,570
1,650,618
1,798,570
1,650,618
Secured borrowing at amortised cost
Bank loans
40,348,612
-
Bank loans – undrawn
(572,450)
Bank loans – capitalised interest
450,742
-
40,226,904
-
Current
42,025,474
1,650,618
Principal features of the Group’s borrowing are as follows:
(a) The Group has 5 principal bank loans:
▪ A loan of $12,911,556 (€8,000,000) was taken out on 31 March 2021, comprising interest-only payments
at a rate of 4.92%. The loan is due for renewal on 10 December 2024 and is secured by a letter of credit
from Oaktree Capital Management L.P. As at reporting date $12,575,949 (€7,792,058) of the loan was
drawn.
▪ A loan of $8,069,722 (€5,000,000 ) was taken out on 21 October 2020, comprising interest-only payments
at a rate of 5.00%. The loan is due for renewal on 11 October 2024 and is secured by a letter of credit from
Oaktree Capital Management L.P. As at reporting date $8,067,941 (€4,998,921) of the loan was drawn.
▪ A loan of $5,648,806 (€3,500,000 ) was taken out on 1 October 2021, comprising interest-only payments
at a rate of 5.00%. The loan was renewed on 15 September 2024 and is secured by a letter of credit from
Oaktree Capital Management L.P.
EQ Resources Limited Annual Report 2024 111
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
46
▪ As at reporting date $572,450 (€354,690) of the loan was drawn.
▪ A loan of $5,648,806 (€3,500,000 ) was taken out on 31 January 2022, comprising interest-only payments
at a rate of 5.00%. The loan is due for renewal on 10 December 2024 and is secured by a letter of credit
from Oaktree Capital Management L.P. As at reporting date $5,573,773 (€3,453,510) of the loan was
drawn.
▪ A loan of $8,069,722 (€5,500,000 ) was taken out on 7 September 2022, comprising interest-only payments
at a rate of 5.42%. The loan is due for renewal on 21 June 2024 and is secured by a letter of credit from
Oaktree Capital Management L.P. As at reporting date $7,913,459 (€4,903,179) of the loan was drawn.
(b) The Group has 1 unsecured related party loan:
A 6-month unsecured loan facility was provided by a related party of the Group, Director and shareholder, Zhui
Pei Yeo, at an interest rate of 8% per annum charged on the outstanding loan balance. As announced on 31
July 2023, a secondary Variation Agreement was entered into to extend the repayment date from 31 July 2023
to 31 July 2024, hence its classification as a current liability in the Statement of Financial Position.
Approval was given at the Extraordinary General Meeting held on 29 July 2024 for the issue of up to 39,304,733
shares and 13,101,578 free attaching options to Zhui Pei Yeo (or his nominee) in consideration for the
settlement of above related party loan. Refer ASX announcements “Notice of Extraordinary General
Meeting/Proxy Form” dated 26 June 2024 and “Results of Meeting” dated 29 July 2024.
25. OTHER FINANCIAL LIABILITIES
2024
$
2023
$
Financial liabilities carried at fair value through profit or loss:1
-
Current
1,245,147
1,334,992
Non-current
10,538,413
11,505,740
11,783,560
12,840,732
Deferred interest:2
Current
49,665
34,204
Non-current
281,436
282,181
331,101
316,385
Total Financial Liabilities
12,114,661
13,157,117
1
A discounted cash flow method using a discount rate of 5.455% (2021: n/a) was used to capture the net present value of the revenues
for the life of mine as determined in the May 2023 Update of the BFS.
2
Deferred interest relates to that portion of the Regal Resources Royalties Fund where actual payments did not satisfy the interest
component due to the staged ramp-up of Open Cut operations. These costs will be amortised over the period in which the first stage
royalty of $10 million is scheduled to be repaid.
The Company entered into a Royalty Funding Package with Regal Resources Royalties Fund with the Group
receiving $10 million in two separate tranches. The financing consists of a royalty percentage of 3% with a
buy-back option after the recovery of the first stage royalty, $10 million (and before the 7 anniversary of the
definitive agreement execution) and a payment of $2.75 million, reducing the liability to 1.5% for the life of
mine.
26. LEASES
Movements in the Group’s lease liabilities during the year are as follows:
Notes to the Consolidated Financial Statements continued
112
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
47
Right-of-use assets
2024
$
2023
$
Balance at 1 July 2023
2,376,049
2,019,963
Additions:
- Plant & equipment
1,751,191
180,005
- Heavy & light vehicles
466,010
930,146
Disposals
(42,935)
(115,768)
Amortisation charge for the year
(1,100,019)
(638,297)
Balance at 30 June 2024
3,450,296
2,376,049
Lease Liability - Maturity Analysis
Less than 1 year
1,324,113
910,822
1 to 5 years
1,823,620
1,176,523
5+ years
-
-
3,147,733
2,087,345
Amounts Recognised in profit or loss
Interest on lease liabilities
153,110
115,168
Expenses relating to short-term leases
-
-
153,110
115,168
Amounts recognised in the statement of cash flows
150,111
55,834
Total cash outflow for leases
937,693
345,492
27. CORPORATE INFORMATION
The Financial Report of the Group for the year ended 30 June 2024 was authorised for issue in accordance
with a resolution of the Directors on 30 September 2024.
EQ Resources Limited is a company limited by shares and incorporated in Australia. Its shares are publicly
traded on the Australian Securities Exchange under the ticker code “EQR”.
28. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The financial risks arising from the Group’s operations comprise market, liquidity and credit risk. These risks
arise in the ordinary course of business, and the Group manages its exposure to them in accordance with the
Group’s risk management strategy. The objective of the strategy is to support the delivery of the Group’s
financial targets while protecting its future financial security.
The Company’s principal financial instruments comprise cash, short term deposits and available for sale
investments.
(a) Price Risk
The Group is not exposed to equity securities price risk.
(b) Liquidity Risk
The Group’s liquidity risk arises from the possibility that it may be unable to settle or meet its obligations as
they fall due. It is managed by maintaining sufficient cash reserves and marketable securities and by
continuously monitoring budgeted and actual cash flows.
The maturity profile of the Group’s financial liabilities based on the undiscounted contractual amounts is as
follows:
EQ Resources Limited Annual Report 2024 113
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
48
Contracted Maturities for Payables
Total
1 year or less
More than 1
year but less
than 2 years
More than 2
years but less
than 5 years
More than 5
years
2024
Trade and other payables
42,647,114
42,647,114
-
-
-
Lease liabilities
3,147,733
1,324,113
1,085,707
737,913
-
Borrowings
42,025,474
42,025,474
-
-
-
Convertible notes
750,000
750,000
-
-
-
Expected future interest payments
Convertible Notes
125,005
61,669
63,336
-
-
Lease liabilities
340,515
198,925
101,989
39,601
-
Borrowings
992,676
992,676
-
-
-
Total
90,028,517
87,999,971
1,251,032
777,514
-
<6 months
6 -12 months
1-5 Years
>5 Years
Total
2023
Trade and other payables
11,309,854
-
-
-
11,309,854
Lease liabilities
379,509
531,313
1,176,523
-
2,087,345
Financial liabilities
387,283
947,709
9,474,113
2,031,627
12,840,732
Total
12,076,646
1,479,022
10,650,636
2,031,627
26,237,931
Refer Note 1 for commentary on going concern assumptions.
The carrying amounts of trade receivables and trade payables are assumed to approximate their fair values
due to their short-term nature.
(c) Fair Value of Financial Instruments
The following tables detail the consolidated entity’s fair values of financial instruments categorised by the
following levels:
Level 1:
Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2:
Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (as prices) or indirectly (derived from prices).
Level 3:
Inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Consolidated – 2024
Level 1
Level 2
Level 3
Total
Total assets
Deferred acquisition costs
1,252,459
-
-
1,252,459
Capitalised borrowing costs
646,213
-
-
646,213
Shares held in listed entities
1,160
-
-
1,160
Unexpired Interest
-
2,760,074
-
2,760,074
1,899,832
2,760,074
-
4,659,906
Total liabilities
Deferred interest
-
331,102
-
331,102
Financial liability
-
11,783,559
-
11,783,559
-
12,114,661
-
12,114,661
Notes to the Consolidated Financial Statements continued
114
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
49
Consolidated – 2023
Level 1
Level 2
Level 3
Total
Total assets
-
-
Deferred acquisition costs
221,729
-
-
221,729
Capitalised borrowing costs
308,500
-
-
308,500
Shares held in listed entities
5,156
-
-
5,156
Unexpired Interest
-
2,840,732
-
2,840,732
535,385
2,840,732
-
3,376,117
Total liabilities
Deferred interest
-
316,385
-
316,385
Financial liability
-
12,840,732
-
12,840,732
-
13,157,117
-
13,157,117
There were no transfers between levels during the financial year.
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.
The following table shows the valuation techniques used in measuring fair values for financial instruments in
the Statement of Financial Position:
Type
Valuation technique
Equity securities
Quoted market share price.
Deferred Costs
Actual costs incurred.
Other financial assets & liabilities*
Discounted cash flows: the valuation model considers the present
value of expected payments, discounted using a risk-adjusted
discount rate.**
* Other financial assets include unexpired interest.
Other financial liabilities include deferred interest and financial liabilities.
** Refer Note 25 for the inputs used in the discounted cash flows valuation model.
(d) Commodity Price Risk
The Company is exposed to commodity price risk. This risk arises from its activities directed at exploration and
mining development of mineral commodities. If commodity prices fall, the market for companies exploring
and/or mining for these commodities is affected. The Company does not currently hedge its exposures.
(e) Fair Values
For financial assets and liabilities, the fair value approximates their carrying value. No financial assets and
financial liabilities are readily traded on organised markets in standardised form other than listed investments.
The Company has no financial assets, including derivative financial assets and liabilities, where the carrying
amount exceeds the net fair values on the reporting date. The Company’s receivables at the reporting date
comprise of GST input tax credits refundable by the Australian Taxation Office and other receivables. The
balance (if any) of receivables comprises prepayments (if any). The credit risk on the Company's financial
assets, which has been recognised on the Statement of Financial Position, is generally the carrying amount.
(f)
Capital Risk Management
The consolidated entity’s objectives when managing capital are to safeguard its ability to continue as a going
concern so that it can provide returns for shareholders and benefits for other stakeholders and maintain an
optimum capital structure to reduce the cost of capital. Consistently with others in the industry, the consolidated
entity monitors capital based on the gearing ratio. This ratio is calculated as net debt divided by total capital.
Net debt is calculated as total borrowings less cash and cash equivalents. Total capital is calculated as “equity”
as shown in the Statement of Financial Position plus net debt. The gearing ratio as at 30 June 2024 was 65%
as opposed to 57% at 30 June 2023.
EQ Resources Limited Annual Report 2024 115
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
50
The increase in the ratio is predominately due to the Company financing its capital growth initiatives for the Mt
Carbine Tungsten Project via debt rather than equity.
In order to maintain or adjust the capital structure, the consolidated entity may adjust the dividends paid to
shareholders, return capital to shareholders, issue new shares, or sell assets to reduce debt.
The consolidated entity would look to raise capital when an opportunity to invest in a business or company
was seen as value adding relative to the current parent entity’s share price at the time of the investment. The
consolidated entity continues to evaluate corporate and exploration opportunities within the new economy and
critical minerals sector.
The consolidated entity is subject to certain financing arrangements and covenants, and meeting these is given
priority in all capital risk management decisions. There have been no events of default on the financing
arrangements during the financial year.
The capital risk management policy remains unchanged from the 30 June 2021 Annual Report. The
consolidated entity is not subject to externally imposed capital requirements.
29. SHARE BASED PAYMENTS
(a) Expenses arising from share-based payment transactions
Total expenses arising from share-based payment transactions recognised during the period were as follows:
Expensed
FV at
Grant Date
Expensed /
Capitalised in
prior years
Lapsed /
Forfeited
Options/
Shares
Capitalised
2024 Year
IFRS 2
Not yet
Expensed
Options issued to key management
personnel
29,933
-
-
29,769
-
164
Options issued to
employees/consultants / sophisticated
investors
4,009,587
-
8,980
3,476,172
521,959
2,476
Shares issued to for senior financial
advisor service fees
25,004
-
-
25,004
-
-
Total share-based payments
4,064,524
-
8,980
3,530,945
521,959
2,640
The fair value of options issued during the year was calculated by using a black-scholes pricing model applying
the following inputs:
Key Management
Personnel, Employees
& Contractors
Sophisticated
Investors
Sophisticated
Investors
Grant date
03/07/2023
18/01/2024
28/05/2024
Number issued
16,100,000
78,000,000
88,646,721
Share price at the grant date
$0.072
$0.068
$0.063
Exercise Price
$0.010
$0.010
$0.0675
Life of options (years)
3 Years
2 Years
3 Years
Expected share price volatility
72.661%
60.232%
60.232%
Weighted average risk-free interest rate
3.97%
3.92%
4.07%
Fair value per option
$0.02993
$0.01583
$0.02610
Vesting conditions
1 Year1
12 Month Escrow
None
1 1 year from the date of issue subject to continuous employment or rendering of services by/to the Company to the vesting date.
Each option provides the right for the option holder to be issued one fully paid share in the Company upon
payment of the exercise price of each option once vesting conditions have been met.
Historical volatility has been used to determine expected share price volatility as it is assumed that this
indicates future trends, which may not eventuate.
Notes to the Consolidated Financial Statements continued
116
EQ Resources Limited Annual Report 2024
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
51
For service provider options, the value of the service rendered was unable to be measured reliably, and
therefore, the value was measured by reference to the fair value of the options issued.
(b) Options Issued
The following table details the number and movements in options issued as employment incentives to Key
Management Personnel during the year.
2024
Number
2024
WAEP
2023
Number
2023
WAEP
Outstanding at the beginning of the year
33,250,000
0.061
42,000,000
0.058
Granted
1,000,000
0.010
1,250,000
0.065
Forfeited/cancelled
(27,000,000)
0.059
-
-
Exercised1
(5,000,000)
0.059
(10,000,000)
0.050
Expired
-
-
-
-
Outstanding at year end
2,250,000
0.104
33,250,000
0.061
Exercisable at year end
1,250,000
0.104
33,250,000
0.061
1
Options are deemed exercised upon the resignation of Key Management Personnel. The 1,250,000 Options issued to Directors as
part of the October 2022 placement have been excluded as they were not issued as remuneration.
(c) Performance Rights / Options lapsed during the reporting period
No performance rights were issued during the reporting period.
30. EMPLOYEE BENEFITS
2024
$
2023
$
Current
Annual leave benefits
488,203
413,798
Long service leave benefits
28,727
26,121
516,930
439,919
Non-current
Long service leave benefits
22,383
31,868
Total employee benefits
539,313
471,787
31. PROVISIONS
2024
$
2023
$
On acquisition of subsidiary
Provision for dismantling costs
2,264,374
-
Total provisions
2,264,374
-
32. NEW ACCOUNTING STANDARDS AND INTERPRETATIONS
Adoption of New Standards and Interpretations
Changes in accounting policies on the initial application of Accounting Standards
From 1 July 2023, the Company has adopted all the standards and interpretations mandatory for annual
periods beginning on or after 1 July 2023. The adoption of these standards and interpretations did not have
any effect on the statements of the company's financial position or performance. The Company has not elected
to early adopt any new standards or amendments.
EQ Resources Limited Annual Report 2024 117
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
52
33. PARENT ENTITY INFORMATION
The following information relates to the parent entity, EQ Resources Limited. The information presented has
been prepared using accounting policies that are consistent with those presented in Note 1.
2024
$
2023
$
ASSETS
Current assets
55,218,343
22,913,935
Non-current assets
28,391,268
27,512,937
TOTAL ASSETS
83,609,611
50,426,872
LIABILITIES
Current liabilities
5,136,580
9,365,121
Non-current liabilities
10,328,941
9,974,439
TOTAL LIABILITIES
15,465,521
19,339,560
NET ASSETS
68,144,090
31,087,312
EQUITY
Issued capital
68,338,429
27,222,110
Reserves
5,675,116
3,523,413
Accumulated gains / (losses)
(5,869,455)
341,789
TOTAL EQUITY
68,144,090
31,087,312
FINANCIAL PERFORMANCE
Profit (loss) for the year
(6,207,248)
2,075,825
Other comprehensive income/(loss) for the year
(3,996)
(387)
Total comprehensive profit/(loss)
(6,211,244)
2,075,438
Contingent Liabilities
As at 30 June 2024 and 30 June 2023 the Company had no contingent liabilities other than those disclosed in
Note 17.
Contractual Commitments
In addition to the contractual commitments outlined in the Significant Changes section of the Directors Report,
the following material contractual commitments were entered into during the period:
▪ Contract to purchase property, plant and equipment for $5,497,350. Non-refundable deposits of $1,780,000
were paid during the year, with the balance expected to be settled via a supplier finance facility consisting
of 5.75% interest p.a. with repayments spread over 48 months. This commitment is expected to be settled
in the 2025 – 2026 financial year.
▪ Compensation contract with Australian Wildlife Conservancy, the underlying leaseholder of the Mt Carbine
Mining Leases (ML 4867 & ML 4919). This contract will give rise to an annual expense of $68,474 for the
life of mine.
▪ Mining Services Agreement with Golding Contractors Pty Ltd for the Andy White Open Cut mining
operations. The committed contract period is for 70 months, estimated at $179 million. The first 12-18 month
period of the contract is based on a cost-plus model, which will be transitioned to rise-and-run matrix rates
once a site-specific baseline cost has been established.
Guarantees Entered into by Parent Entity
As at 30 June 2024, the Group has not provided any financial guarantees.
118
EQ Resources Limited Annual Report 2024
Notes to the Consolidated Financial Statements continued
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
53
34. OPERATING SEGMENTS
Segment Information
Identification of Reportable Segments
During the 2023 financial year, the Company operated principally in one business segment, mineral
exploration, and in two geographical segments, Queensland and New South Wales, Australia.
The Company’s revenues, assets, and liabilities according to geographical segments are shown below.
June 2024
June 2023
Total
$
Australia
$
Spain
$
Total
$
Queensland
$
NSW
$
REVENUE
Revenue & Other Income
30,327,090
16,146,183
14,180,907
13,119,652
13,119,652
-
Total segment revenue
30,327,090
16,146,183
14,180,907
13,119,652
13,119,652
-
RESULTS
Profit / (loss) before income tax
(28,258,882)
(20,160,346)
(8,098,536)
(3,716,846)
(3,716,846)
-
Income tax
-
-
-
-
-
-
Profit/ (loss) after income tax
(28,258,882)
(20,160,346)
(8,098,536)
(3,716,846)
(3,716,459)
-
ASSETS AND LIABILITIES
Assets
166,286,409
75,734,356
90,552,053
55,146,312
54,950,009
196,303
Liabilities
(109,660,751)
(34,628,093)
(75,032,658)
(38,841,748)
(38,841,748)
-
35. RELATED PARTY DISCLOSURES
(a) The Company’s main related parties are as follows:
Key management personnel:
Any person(s) having authority and responsibility for planning, directing and controlling the activities of the
Company, directly or indirectly, including any director (whether executive or otherwise), are considered key
management personnel.
The Directors and Officers in office during the year were as follows:
•
Oliver Kleinhempel
(Sonnenalee Investments Limited)
Appointed Non-executive Director, 12 August 2019
Appointed Non-executive Chairman, 24 April 2020
•
Stephen Layton
(Bodie Investments Pty Ltd)
(Sindel Nominees Proprietary Limited)
Appointed Non-executive Director, 14 November 2017
•
Richard Damon Morrow
(Yavern Creek Holdings Pty Ltd)
Appointed Non-executive Director, 16 March 2021
•
Stephen Robert Weir
Appointed Non-executive Director, 19 January 2024
•
Zhui Pei Yeo
(Whitfords Holdings Investments Pty Ltd)
Appointed Non-executive Director, 12 August 2019
•
Kevin Bruce MacNeill
Appointed Chief Executive Officer, 1 April 2021
For details of disclosures relating to key management personnel, refer to Key Management Personnel
disclosures Directors and Remuneration Report.
EQ Resources Limited Annual Report 2024 119
ANNUAL Report June 2024
Notes to the Consolidated Financial Statements
54
(b) Transactions with other related parties:
Transactions between other related parties are on normal commercial terms and conditions no more
favourable than those available to other parties unless otherwise stated.
There were no transactions with other related parties during the reporting period.
(c) Receivable from and payable to related parties
There were no trade receivables from nor trade payables to related parties at the current and previous
reporting date.
(d) Loans to/from related parties
During the reporting period, the Group obtained a $1.5 million, 6-month unsecured loan facility from Director
and shareholder Zhui Pei Yeo at an interest rate of 8% per annum (refer ASX Announcement “CAPEX Funding
for Mt Carbine Expansion Secured” dated 2 May 2022). The loan was settled via the issue of shares and free-
attaching options in August 2024, hence its classification as a current liability in the Statement of Financial
Position. Refer Note 24 for further details.
There were no loans to or from related parties as at the previous reporting date.
(e) Parent entity
EQ Resources Limited is the parent entity.
(f) Subsidiaries
Interests in subsidiaries are set out in Note 19.
120 EQ Resources Limited Annual Report 2024
Notes to the Consolidated Financial Statements continued
55
Body corporates
Entity Name
Entity Type
Place formed /
incorporated
% of share
capital held
Tax residency
EQ Resources Limited
Body Corporate
Australia
N/A
Australia
Mt Carbine Mining Pty Ltd
Body Corporate
Australia
100%
Australia
Mt Carbine Retreatment Pty Ltd
Body Corporate
Australia
100%
Australia
European Tungsten Pty Ltd
Body Corporate
Australia
100%
Australia
Mt Carbine Quarrying Operations Pty Ltd
Body Corporate
Australia
100%
Australia
Mt Carbine Quarries Pty Ltd
Body Corporate
Australia
100%
Australia
Icon Resources Africa Pty Ltd
Body Corporate
Australia
100%
Australia
Mt Carbine Retreatment Management Pty Ltd
Body Corporate
Australia
100%
Australia
Saloro S.L.U.
Body Corporate
Spain
100%
Spain
Consolidated Entity Disclosure Statement
EQ Resources Limited Annual Report 2024 121
56
The Directors of the Company declare that:
1.
the Financial Statements, comprising the Statement of Profit or Loss and Other Comprehensive Income,
Statement of Financial Position, Statement of Cash Flows, Statement of Changes in Equity and
accompanying Notes, are in accordance with the Corporations Act 2001 and:
a) comply with Accounting Standards, which, as stated in the accounting policy Note 1, to the financial
statements, constitutes explicit and unreserved compliance with International Financial Reporting
Standards (IFRS); and
b) give a true and fair view of the financial position as at 30 June 2024 and of the performance for the
year ended on that date of the company and consolidated group;
2.
the directors have been given the declaration required by s.295A of the Corporations Act 2001 by the
Chief Executive Officer declaring that:
a) the financial records of the company for the financial year have been properly maintained in
accordance with s 286 of the Corporations Act 2001;
b) the Financial Statements and notes for the financial year comply with Accounting Standards; and
c) the Financial Statements and notes for the financial year give a true and fair view;
3.
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; and
4.
the Consolidated Entity Disclosure Statement on Page 121 is true and correct.
This declaration is made in accordance with the resolution of the Board of Directors.
On behalf of the Board
Oliver Kleinhempel
Non-executive Chairman
30 September 2024
Directors’ Declaration
122
EQ Resources Limited Annual Report 2024
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Independent Auditor’s Report continued
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EQ Resources Limited Annual Report 2024
Australia
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EQ Resources Limited Annual Report 2024 127
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Independent Auditor’s Report continued
128
EQ Resources Limited Annual Report 2024
62
Registered Office
Level 4, 100 Albert Road
South Melbourne VIC 3205, Australia
Phone: +61 (0)7 4094 3072
Company Secretary
Ms Melanie Leydin
Shareholder Enquiries
Shareholder’s information in relation to shareholding or share transfer can be obtained by contacting the
Company’s share registry:
Automic Registry Services
GPO Box 5193
Sydney NSW 2001
Telephone: 1300 288 664 (local), +61 (0)2 9698 5414 (international)
Website: www.automicgroup.com.au
Please provide your Security-holder Reference Number (SRN) or Holder Identification Number (HIN) for all
correspondence to the share registry.
Change of Address
Changes to your address can be updated online at
https://www.automicgroup.com.au or by obtaining a
Change of Address Form from the Company’s share registry. CHESS-sponsored investors must change their
address details through their broker.
Annual General Meeting
The Annual General Meeting will be held in Melbourne on 27 November 2024 at 3.00 pm (AEDT). The time
and other details relating to the meeting will be provided in the Notice of Meeting, which will be sent to all
shareholders and released to the ASX immediately upon dispatch.
The Closing date for receipt of nomination for the position of Director is 9 October 2024. Any nominations must
be received in writing at the Company's Registered Office no later than 5.00 pm (Melbourne time) on 9 October
2024.
The Company notes that the deadline for the nominations for the position of Director is separate from voting
on Director elections. In due course, details of the Directors to be elected will be provided in the Company’s
Notice of Annual General Meeting.
Corporate Governance Statement
The Company’s 2024 Corporate Governance Statement, once released to the ASX, will be available on the
Company’s website at https://www.eqresources.com.au
Annual Report Mailing List
All shareholders are entitled to receive the Annual Report. In addition, shareholders may nominate not to
receive an Annual Report by advising the share registry in writing, by fax, or by email, quoting their SRN/HIN.
Shareholder Information
EQ Resources Limited Annual Report 2024 129
ANNUAL Report June 2024
Shareholder Information
63
Securities Exchange Listing
EQ Resources shares are listed on the Australian Securities Exchange and trade under the ASX code EQR.
The securities of the Company are traded on the ASX under CHESS (Clearing House Electronic Sub-Register
System).
ASX Shareholder Disclosures
The following additional information is required by the Australian Securities Exchange in respect of listed public
companies. The information is current as at 23 September 2024.
Distribution of Equity Securities
Analysis of numbers of ordinary shareholders by size of holding.
Ordinary Shares
Options over
Ordinary Shares
Convertible Notes
Number
of
Holders
Number
Issued
Number
of
Holders
Number
Issued
Number of
Holders
Number
Issued
1 – 1,000
90
12,800
-
-
-
-
1,001 – 5,000
47
149,210
-
-
-
-
5,001 – 10,000
212
1,849,070
-
-
-
-
10,001 – 100,000
1,053
44,272,912
-
-
-
-
100,001 – and over
822
1,785,420,317
1
1,000,000
1
750,000
Total
2,224
1,831,704,309
1
1,000,000
1
750,000
Holdings less than
a marketable
parcel
356
2,082,445
1
7,408
-
-
Equity Security Holders
Twenty largest quoted equity security holders.
Position & Holder Name
Holding
1. CITICORP NOMINEES PTY LIMITED
204,153,435
2. BNP PARIBAS NOMS PTY LTD
117,060,641
3. ZHUI PEI YEO
113,898,154
4. BNP PARIBAS NOMINEES PTY LTD
104,245,035
5. LYNEWOOD HOLDINGS LTD
59,300,000
6. ARCHER PACIFIC HOLDING LIMITED
55,000,000
7. BODIE INVESTMENTS PTY LTD
50,812,500
8. SHAWLANE CAPITAL LTD
44,662,480
9. VENTURE FRONTIER LIMITED
38,461,539
10. TA SECURITIES HOLDINGS BERHAD
35,080,197
11. OCM LUXEMBOURG TUNGSTEN HOLDINGS SA RL
31,666,667
12. HEMMINGWAY UNITED INVESTMENT LTD
31,088,236
13. BAGLORA PTY LTD
MOTT FAMILY SUPER FUND A/C
31,000,000
14. BNP PARIBAS NOMINEES PTY LTD
30,700,881
15. MONEX BOOM SECURITIES (HK) LTD
27,700,000
130 EQ Resources Limited Annual Report 2024
Shareholder Information continued
ANNUAL Report June 2024
Shareholder Information
64
Position & Holder Name
Holding
16. HONWAI PTY LTD
26,606,231
17. DR LEON EUGENE PRETORIUS
22,432,744
18. TAN KIM SENG
22,222,000
19. ROKKS RESOURCES PTY LTD
19,000,000
20. SHAWLANE CAPITAL LTD
18,787,500
Total: Top 20 Holders of Ordinary Fully Paid Shares
1,083,878,240
Unquoted Equity Securities
Holding
Option Holders
Options over ordinary shares issues
140,853,676
241
Convertible Notes
750,000
1
Escrowed Securities
Holding
Holders
Shares
405,323,657
2
Options
78,000,000
1
Substantial Option Holders
Substantial option holders in the Company are set out below:
Substantial Option Holders
Holding
% of Total
Options Issued
ZHUI PEI YEO
13,784,448
9.72%
OCM LUXEMBOURG TUNGSTEN HOLDINGS SA RL
10,555,556
7.44%
TAN KIM SENG
7,407,334
5.22%
Substantial Convertible Note Holders
Substantial Convertible Noteholders in the Company, as disclosed in substantial holding notices given to the
Company, are set out below:
Substantial Shareholders
Number Held
Percentage
TAN QUAN KAI ALEX
750,000
100%
Substantial Holders
Substantial holders in the Company, as disclosed in substantial holding notices given to the Company, are set
out below:
Substantial Shareholders
Number Held
Percentage
OCM Luxembourg Tungsten Holdings S.á r.l
278,000,000
15.00%
EQ Resources Limited Annual Report 2024 131
ANNUAL Report June 2024
Shareholder Information
65
Voting rights
The voting rights attached to ordinary shares are set out below:
Ordinary Shares
On a show of hands, every member present at a meeting in person or by proxy shall have one vote, and upon
a poll, each share shall have one vote.
Unquoted Securities
There are no voting rights attached to the unquoted options.
There are no other classes of equity securities.
132
EQ Resources Limited Annual Report 2024
Shareholder Information continued
66
Some statements contained within this report relate to the future and are forward looking statements. Such
statements may include, but are not limited to, statements with regard to intention, capacity, future production
and grades, projections for sales growth, estimated revenues and reserves, targets for cost savings, the
construction cost of new projects, projected capital expenditures, the timing of new projects, future cash flow
and debt levels, the outlook for minerals and metals prices, the outlook for economic recovery and trends in
the trading environment and may be (but are not necessarily) identified by the use of phrases such as “will”,
“expect”, “anticipate”, “believe” and “envisage”. By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend on circumstances that will occur in the future and may
be outside EQ Resources Limited’s control. Actual results and developments may differ materially from those
expressed or implied in such statements because of a number of factors, including levels of demand and
market prices, the ability to produce and transport products profitably, the impact of foreign currency exchange
rates on market prices and operating costs, operational problems, political uncertainty and economic
conditions in relevant areas of the world, the actions of competitors, activities by governmental authorities such
as changes in taxation or regulation.
Given these risks and uncertainties, undue reliance should not be placed on forward-looking statements and
intentions which speak only as at the date of the presentation. Subject to any continuing obligations under
applicable law or any relevant stock exchange listing rules, EQ Resources does not undertake any obligation
to publicly release any updates or revisions to any forward-looking statements contained in this presentation,
whether as a result of any change in EQ Resources’ expectations in relation to them, or any change in events,
conditions or circumstances on which any such statement is based.
Certain statistical and other information included in this presentation is sourced from publicly available third-
party sources and has not been independently verified.
Forward Looking Statements
EQ Resources Limited Annual Report 2024 133
www.eqresources.com.au