Era Group Inc Annual Report 2021

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FY2021 Annual Report · Era Group Inc

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Energy Resources of Australia Ltd

ANNUAL
REPORT
2021

Seedling grown from seed collected by Kakadu Native Plants in ERA’s nursery.

Contents

1
2021 AnnUAL RePoRt

29
FInAnCIAL RePoRt

CHAIRMAN’S REPORT

CHIEF EXECUTIVE’S REPORT

COMPANY OVERVIEW

FINANCIAL PERFORMANCE

OPERATIONS AND REHABILITATION

BUSINESS STRATEGY

BUSINESS RISKS

FUTURE SUPPLY

SALES AND MARKETING

HEALTH AND SAFETY

REGULATORY FRAMEWORK

DIRECTORS’ REPORT

AUDITOR’S INDEPENDENCE DECLARATION

CORPORATE GOVERNANCE STATEMENT

STATEMENT OF COMPREHENSIVE INCOME

BALANCE SHEET

STATEMENT OF CHANGES IN EQUITY

CASH FLOW STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

DIRECTORS’ DECLARATION

INDEPENDENT AUDITOR’S REPORT

SHAREHOLDER INFORMATION (UNAUDITED)

101

2021 ASX ANNOUNCEMENTS (UNAUDITED)

103

ENERGY RESOURCES OF AUSTRALIA LTD PeRFoRmAnCe stAts

SALES REVENUE ($M)

DRUMMED PRODUCTION TONNES (T)

2017

2018

2019

2020

2021

211.2

201.2

209.6

242.2

2017

2018

2019

2020

2,294

1,999

1,751

1,574

190.3

2021

NET PROFIT AFTER TAX ($M)

INDIGENOUS EMPLOYEES (FTEs)

2017

2018

2019

2020

2021

2017

2018

2019

2020

ALL INJURY FREQUENCY RATE
(PER 200,000 HRS WORKED)

1.17

1.07

0.56

0.53

2021

0.00

-43.5

-435.3

6.3

11.5

2017

2018

2019

2020

2021

-650.2

7.8

OPERATING CASHFLOW ($M)

2017

2018

-76.3

2019

-99.5

2020

2021

-19.3

-37.9

ENERGY RESOURCES OF AUSTRALIA LTD RAngeR oPeRAtIons mAP

JABILUKA

MINERAL

LEASE

(73 sq km)

RAngeR mIne

RegI steReD oFFIC e

Locked Bag 1
Jabiru NT 0886

Energy Resources of Australia Ltd
c/ Mallesons Stephen Jacques
Level 5 NICTA Building B
7 London Circuit
Canberra City ACT 2601

HeAD oFFIC e

Level 3, Energy House
18-20 Cavenagh Street

GPO Box 2394
Darwin NT 0801

Telephone:
+61 (0) 8 8924 3500

Fax:
+61 (0) 8 8924 3555

https://www.energyres.com.au

ABN 71 008 550 865

ENERGY RESOURCES OF AUSTRALIA LTD CHAIRmAn's RePoRt

I want to begin by confirming
the Company’s commitment to
deliver on its environmental,
cultural and community
obligations. The past year has
been challenging, however I
can reassure all stakeholders
that our commitment to, and
progress towards, achieving
the outcomes required under
our very strict regulatory
framework does not waiver.

The year 2021 was book-ended by two very significant
events: the cessation of processing of stockpiled ore at
the start of the year and, late in the year, recognition of
material overruns in the cost estimate and schedule for
Ranger rehabilitation.

On the 8 January 2021 the last drum of uranium oxide
was produced at Ranger and processing ceased in
accordance with the Ranger Section 41 Authority.
During its life Ranger produced more than 132 thousand
tonnes of drummed uranium oxide and was Australia’s
longest continually operating uranium producer.

Ranger continues to be iconic as the Company
progresses the world class rehabilitation of the Ranger
Project Area, befitting the unique and sensitive location
in which Ranger is located and in accordance with the
regulatory Environmental Requirements. This is a major
project in its own right: it comes at a significant cost and
will take many years.

Regrettably, since the Ranger Closure Feasibility Study
was approved in February 2019, and the Entitlement
Offer was completed in February 2020, there have
been increasing costs as well as challenges to meeting
the existing 2026 deadline for completion of the major
rehabilitation activities. In its 2021 half year results
announcement, the Company noted a number of
changes in assumptions between the Feasibility Study
and those that may materialize during execution, and
accordingly a reforecast of both cost and schedule
data was required. That reforecast process formally
commenced in October 2021.

As part of the reforecast process, the Company engaged
global engineering firm Bechtel to carry out an independent
review and gap analysis of ERA’s forecast cost and
schedule data. On 2 February 2022, following receipt of
Bechtel’s review, the Company announced the preliminary
findings of the reforecast exercise. These findings indicate
that the revised total cost of completing the rehabilitation of
Ranger, including incurred spend since 1 January 2019,
is estimated to be between $1.6 billion and $2.2 billion.

The previous estimate, based on the Ranger Closure
Feasibility Study, was $973 million. The revised date for
completion of rehabilitation activities is forecast to be
between Quarter 4, 2027 and Quarter 4, 2028.

There is no single cause for these overruns. Rather it is a
combination of impacts due to, for example, technical risk
management, project delays, and additional scope items
and associated unbudgeted costs. We are undertaking
leading edge rehabilitation in a complex environment with
a range of project risks. As execution proceeds some of
these risks have materialized. The reforecast process
will help ensure we have a clear pathway and capability
to achieve our rehabilitation objectives. The Board is
currently reviewing all available options with a view to
ensure that the increased forecast cost of rehabilitation
will be adequately funded.

I am very aware of the concerns the material overruns and
the reforecast process generate for our shareholders and
other stakeholders. The Company’s major shareholder,
Rio Tinto has advised that it is committed to working with
ERA to ensure that the rehabilitation of the Ranger Project
Area is successfully achieved. I want to express my
thanks to Rio Tinto for this support.

While the rehabilitation of Ranger remains the Company’s
strategic priority, the Board has continued to look at
opportunities beyond Ranger. However our immediate
focus is necessarily on completing the reforecast process
and securing the funds to complete rehabilitation.

The Company remains committed to working with
Traditional Owners, regulators, key stakeholders and
the wider public to deliver the required environmental
outcomes. Despite the disappointment of the anticipated
cost and schedule overruns, we should not lose sight of
the major rehabilitation milestones that were achieved
in 2021. These included the conclusion of dredging of
the TSF and transfer of tailings to Pit 3, the cleaning of

ENERGY RESOURCES OF AUSTRALIA LTD CHAIRmAn's RePoRt

the TSF floor and walls, and the commencement and
substantial progress of revegetation of Pit 1. We have also
worked closely with our key stakeholders toward getting
the Atomic Energy Act amended and we have expressed
our commitment to seeking a further section 41 Authority
to allow the necessary time to carry out the full
rehabilitation of Ranger. The Company is working towards
delivering on the required environmental outcomes.

I would like to acknowledge the members of the workforce
who have left ERA since the cessation of production in
January 2021, including former Chief Executive Paul
Arnold. I wish them all well for the future. I also welcome
new members to the ERA team including director
Rosemary Fagan and recently appointed Chief Executive
Brad Welsh. Brad’s appointment follows his strong
contribution and leadership while acting in the role.

Finally I want to thank my fellow members of the Board,
the senior management team and all of the workforce
at ERA for their support and efforts during a challenging
year. 2022 will no doubt be another challenging year and
I look forward to working with everyone at ERA to rise
to the challenges ahead and to deliver outcomes that
enhance our reputation and future opportunities.

Peter Mansell
Chairman

I remain very confident and proud that the Company
will achieve world class closure outcomes.

The global COVID-19 pandemic continued to threaten the
health of our people and local communities and to disrupt
Ranger activities in 2021. The ERA team has applied
strategies to implement the advice of medical authorities
and respond to constant adjusting of Government policy
to limit the spread of the virus. I would like to acknowledge
the flexibility and determination of the employees and
contractors to keeping Ranger running smoothly, including
the operation of essential services to the region such as
power supply and airport services. I also commend the
overwhelming majority of the ERA workforce who have
had their two doses of a COVID-19 vaccine and a booster
shot in line with Company and NT Government policy.
This is now a requirement to work at ERA.

I would like to applaud the ERA team’s safety record of
zero injuries in 2021. While an improvement in safety
performance was perhaps to be expected with the
cessation of processing operations, the decommissioning
of the processing plant and the major rehabilitation
works introduce new and different risks to our business
which are themselves inherently risky activities. The ERA
workforce is to be commended on achieving an injury free
year as well as protecting country from any detrimental
environmental incidents. Well done to all.

ENERGY RESOURCES OF AUSTRALIA LTD CHIeF exeCUtIve's RePoRt

This is my first report as Chief
Executive and Managing
Director of ERA. I was very
pleased to be offered this
opportunity and am excited
about the journey ahead,
both for myself and for the
Company. Although I join at
a time when there are many
challenges, I also embrace
the opportunity to deliver
world class rehabilitation
outcomes in partnership with
Traditional Owners at Ranger, outcomes that will meet the
expectations of key stakeholders and the wider public, and
also create a strong reputational legacy for ERA on which
we may build a future.

Our first priority at ERA is the wellbeing of our people and
local communities. We want people who work with ERA
to be able to return home safe and healthy to their loved
ones after a day’s work. I am pleased to report that ERA
achieved an All Injuries Frequency Rate of 0.0 in 2021.
This means we had no lost time injuries, no restricted
work injuries and no medical treatment cases last year.
That is an outstanding result and I commend all at ERA
for this achievement.

While celebrating this achievement we also want to
recognise that our risk profile has changed and continues
to change in the transition from operations to delivery of
a major project. This change in risk profile requires our
constant attention, as an injury can so easily occur if we
drop our guard. Our business is well positioned to build
on an injury free year through continuing to implement
the Critical Risk Management framework and the
Safety Maturity Model which have been adopted from
Rio Tinto. We still have a way to travel on this journey
and to actively transition to a newer and different risk
profile post operations.

We continued to implement our COVID-19 management
Plan in 2021. We complied with and often, following a
precautionary approach, exceeded restrictions set by
Government health authorities. In doing so we worked
closely with local Jabiru agencies and stakeholders.
After almost two years remaining COVID-19 free, the
Omicron variant crept into the Kakadu region in early 2022.
Fortunately vaccination rates in Jabiru and surrounding
communities increased significantly before the virus
arrived. ERA requires all workers to be fully vaccinated
against COVID-19 in line with Government health authority

guidance. I thank my ERA colleagues for their support in
helping to prevent the local spread of COVID-19.

Along with health and safety, another major priority for the
Company is caring for country. We continued to make
good headway with the progressive rehabilitation of the
Ranger site with cash expenditure of $153 million and
several significant milestones achieved in 2021. One such
milestone was the commencement of revegetation at Pit
1 in September following completion of the backfilling and
final landform in 2020. Seedlings were propagated by
Kakadu Native Plant Services, a local Indigenous business.

Other milestones included the completion of the bulk
dredging works at the Tailings Storage Facility (TSF) in
February 2021. TSF floor and wall cleaning activities were
subsequently completed in December 2021. These TSF
works were highly complex, resource intensive and at
times very challenging. Rehabilitation works on a tailings
dam of this scale are unique in the mining industry and
everyone who worked on this project can be rightly proud
of their achievement. The TSF has now received final
approvals to be used as a Water Storage Facility.

Other key rehabilitation activities included water
treatment initiatives as well as the completion of the Brine
Concentrator upgrade project. The Pit 3 wicking contract
has now been awarded. The wicking and capping of Pit
3 are critical path activities to be completed prior to the
commencement of Pit 3 bulk backfill and final land forming.

All of these achievements, as well as the planning and
approval of future rehabilitation activities, are carried
out in collaboration with the Gundjeihmi Aboriginal
Corporation, the Northern Land Council, the Supervising
Scientist Branch, Commonwealth and Northern Territory
regulators and various statutory committees. Thank
you to everyone who has contributed to the progressive
rehabilitation of Ranger. I particularly thank the Mirarr
Traditional Owners for their guidance and support through
development of the cultural closure criteria and during
site visits as part of the Cultural Reconnection program.
We are looking forward to working with the Mirarr to
better understand the cultural landscape as part of our
rehabilitation activities.

The 2020 update to the Ranger Mine Closure Plan was
approved by the Commonwealth and Northern Territory
Governments in September 2021. The annual update to
the Plan sets out the roadmap for the work required to
complete the rehabilitation of the Ranger Project Area.
The Plan is publicly available on our website. Normally
the Company would issue an annual update to the Mine
Closure Plan each year, however with the support of

ENERGY RESOURCES OF AUSTRALIA LTD CHIeF exeCUtIve's RePoRt

regulators and key stakeholders, the 2021 update has
been delayed until certain outcomes of the reforecast
process can be incorporated into the Plan.

On 8 October 2021 ERA announced it would undertake a
reforecast of costs and schedule for rehabilitation of the
Ranger Project Area. While aspects of this work continue,
on 2 February 2022 ERA announced its preliminary
findings that the cost of the rehabilitation of Ranger, in
accordance with the current Mine Closure Plan, would be
between $1.6 billion and $2.2 billion.

This represents a significant increase from the previous
cost estimate based on the Ranger Feasibility Study.
This is of course very disappointing. The adjustments
to the cost estimate include additional water treatment
and land forming costs, overruns in the conversion of
the Tailings Storage Facility to a Water Storage Facility
and costs associated with a revision to the Pit 3 capping
methodology. All of these revisions are necessary to
ensure the full rehabilitation of the Ranger Project Area in
line with our obligations.

Although Ranger rehabilitation is now our primary focus,
ERA continues to supply uranium oxide into the global
market. With the cessation of processing on 8 January
2021, ERA produced 34 tonnes for the year ended 31
December 2021. The Company continued to sell into
the spot market and completed contracted sales from
inventories of drummed uranium oxide. The 2021 sales
volume totalled 1,302 tonnes compared with 1,721 tonnes
in 2020. Revenue from the sale of uranium oxide was
$190 million in 2021 compared to $242 million in 2022.
ERA continues to maximise the value from remaining
uranium holdings through opportunistic spot sales.

At 31 December 2021 ERA held total cash resources
of $699 million with no debt. However a revision of the
rehabilitation provision cost estimate resulted in an
unfavorable adjustment of $668 million. The rehabilitation
reforecast process is continuing with finalisation expected
in 2022. The Company is exploring all options to fund the
future rehabilitation cost estimate.

A further preliminary finding of the reforecast process
is that ERA expects Ranger rehabilitation activities will
now continue until at least late 2027, past the current
section 41 Authority deadline of January 2026. The need
to extend ERA’s access to the Ranger Project Area
beyond 2026 had already been anticipated by ERA,
Mirarr Traditional Owner representatives and regulators
who have collaborated on the required amendments
to the Atomic Energy Act 1953 which would enable the
Federal Minister for Resources to issue a further section

41 Authority. In January 2022 the Gundjeihmi Aboriginal
Corporation, Northern Land Council and ERA jointly wrote
to the Commonwealth Government expressing support
for the amendment to the Act and urging passage of the
amendment bill at the earliest opportunity.

I would like to congratulate the Mirarr Traditional Owners
on the successful transition of Jabiru to an Aboriginal
township lease under Section 19A of the Aboriginal Land
Rights (Northern Territory) Act 1976 in June 2021. With the
formal recognition of Mirarr rights under the Native Title
Act in 2018 and the execution of the Section 19A lease last
year, Mirarr land ownership over Jabiru is rightfully, finally
and fully established. The four decades long arrangement
under which ERA leased properties in Jabiru under a head
lease from the Commonwealth’s Director of National Parks
expired in June 2021. This meant the required termination
of ERA’s residential and commercial sub-leases in Jabiru,
however ERA continues to be a major tenant in the town
under an interim agreement with the Gundjeihmi Aboriginal
Corporation Jabiru Town.

I look forward to ERA playing a role in helping to create
a sustainable future for Jabiru. ERA’s immediate focus
is on progressing the rectification and handover of ERA
held housing in Jabiru. While the houses are now in the
process of being rectified and handed over in a condition
suitable for the longer term, we acknowledge that the
timing and process leading up to this did not meet
stakeholder expectations. We have been working hard
on these relationships and to play our part in the future
sustainability of the Jabiru township.

In my first four months with ERA as Chief Executive I have
observed the commitment and determination of the ERA
team to deliver the environmental outcomes that the Mirarr
Traditional Owners and the broader community expect.
The ERA team has deep knowledge and experience
in rehabilitation, and has already achieved some real
successes. However we also acknowledge there are areas
for improvement. I am excited to be given the opportunity to
lead ERA in 2022 as we continue on this journey.

Finally I would like to thank everyone who supported ERA
in 2021. I look forward to working together as we rise to
the challenges ahead in 2022.

Brad Welsh
Chief Executive

ENERGY RESOURCES OF AUSTRALIA LTD ComPAny oveRvIew

ERA acknowledges the Mirarr people, the Traditional
Owners of the land on which ERA operates.

ERA operates the Ranger uranium mine. Ranger’s
operational infrastructure lies within the 79 square
kilometre Ranger Project Area, which is located eight
kilometres east of Jabiru and 260 kilometres east of
Darwin, in the Northern Territory of Australia. ERA’s
operations on the Ranger Project Area, including ongoing
rehabilitation activities, are undertaken pursuant to an
authorisation granted under section 41 of the Atomic
Energy Act 1953 (Cth) (the Ranger Authority). Ranger
was Australia’s longest continually producing uranium
mine. ERA, in accordance with IAEA and Australian
Government standards has provided international
customers with reliable supply of uranium oxide (U3O8)
in the 40 years since production at Ranger began.
During that time, Ranger produced in excess of
132,000 tonnes of uranium.

ERA also holds title to the world-class Jabiluka Mineral
Lease. In accordance with the Jabiluka Long Term Care
and Maintenance Agreement, the Jabiluka deposit will not
be developed by ERA without the approval of the Mirarr
Traditional Owners.

The Ranger Project Area and the Jabiluka Mineral Lease
are located on Aboriginal land and are surrounded by, but
separate from, the World Heritage-listed Kakadu National
Park.

Mining operations at Ranger ceased in 2012. ERA
continued to process stockpiled ore until 8 January 2021,
when the Ranger Authority required processing to cease.
The Ranger Project Area is now being progressively
rehabilitated. Under the Ranger Authority ERA must
rehabilitate the Ranger Project Area to establish an

environment similar to the adjacent areas of the Kakadu
National Park such that, in the opinion of the Minister with
the advice of the Commonwealth Supervising Scientist,
the rehabilitated area could be incorporated into the
Kakadu National Park. Under the terms of the current
Ranger Authority, ERA’s rights to access, occupy and use
the Ranger Project Area continue until 8 January 2026.

ERA is a party to a suite of agreements which govern
its activities on the Ranger Project Area with the
Gundjeihmi Aboriginal Corporation, on behalf of the
Mirarr Traditional Owners, the Northern Land Council
and the Commonwealth Government.

ERA has an ongoing sales and marketing agreement
with Rio Tinto Uranium, pursuant to which ERA’s
product is sold to international power utilities under strict
international and Australian Government safeguards,
which ensure that Australian uranium is only used for
peaceful purposes.

In 2015, ERA decided not to progress the Ranger 3
Deeps project to feasibility study. The exploration decline
was backfilled during 2021, following the conclusion of
processing on the Ranger Project Area, as required by
the Ranger Authority. ERA is of the view that the prospect
of any development is remote, considering the economic,
legislative and operational challenges that exist.
Consequently, ERA has not reported mineral resources
for the project at 31 December 2021.

The Company’s shares are publicly held and traded on
the Australian Securities Exchange. Rio Tinto, a diversified
resources group, currently holds 86.3 percent of ERA
shares.

ENERGY RESOURCES OF AUSTRALIA LTD FInAnCIAL PeRFoRmAnCe

ERA incurred negative cash flow from operating activities
of $38 million in 2021 compared to negative $19 million in
2020. Cash rehabilitation spend for the year end
31 December 2021 was $153 million1 compared to
$80 million1 in 2020.

ERA held total cash resources of $699 million at 31
December 2021, comprised of $164 million in cash at
bank and $535 million of cash held by the Commonwealth
Government as part of the Ranger Rehabilitation Trust
Fund. The Company has no debt.

ERA recorded a net profit before tax and rehabilitation
adjustment of $21 million. The net loss after tax was
$650 million for 2021 compared to a net profit after tax
of $11 million for 2020. The 2021 net loss was adversely
impacted by an increase to the rehabilitation provision.
Favourable impacts were seen from significantly lower
operating costs as a result of cessation of operations
in January 2021 and strong sales revenue, with the
completion of all contracted sales and a substantial
sell down of remaining uranium inventories. As at 31
December 2021, a revision of the rehabilitation provision
cost estimate occurred resulting in an unfavourable
adjustment of $668 million.

In response to the ongoing COVID-19 pandemic, ERA
continues to maintain controls and protocols in accordance
with the Company’s COVID-19 Management Plan to
protect our employees and local communities as our
first priority and ensure full compliance with Government
requirements.

RevenUe

Revenue from the sale of uranium oxide was $190 million
(2020: $242 million). Revenue was heavily exposed to the
spot market, with higher spot prices providing a favourable
impact. ERA continues to maximise the value from its
uranium holdings through opportunistic spot sales.

Sales volume for 2021 was 1,302 tonnes compared with
1,721 tonnes for 2020. In 2021, ERA completed sales
of 680 tonnes of uranium oxide into the spot market and
completed contract sales of 622 tonnes. The balance of
inventories will likely be sold into the spot market in 2022.

The average realised sales price for 2021 was US$47.17
per pound compared to US$42.60 per pound in 2020.
The average realised price was favourably impacted by
increased sales into a stronger second half spot market.

With uranium oxide sales denominated in US dollars,
the strengthening of the Australian dollar had an adverse
impact on ERA’s financial results. The average exchange
rate, inclusive of foreign exchange hedges, was 71 US
cents, compared with 67 US cents for 2020.

In 2020, ERA sought to maximise exposure to the
favourable movement in the Australian dollar whereby
ERA entered into a number of forward foreign exchange
contracts for USD denominated sales. These forward
exchange contracts completed in early 2021 at an average
exchange rate of 65 cents, resulting in a benefit of
$9.6 million.

Interest income for 2021 was $1.9 million, compared to
$5.6 million for 2020. The weighted average interest rate
received on term deposit for the period was 0.3 per cent
(2020: 0.8%).

oPeRAtIng C osts

Cash costs for 2021 were substantially lower than the
corresponding period in 2020. This was mainly driven by
the cessation of processing operations in January 2021
and move to full scale rehabilitation. Operating costs are
now those of a corporate or sales nature.

Following a sharp decline in the crude oil price in 2020,
with a corresponding decrease in gasoil (or diesel),
ERA entered into gasoil swap contracts to lock in prices
considered to be favourable. At 31 December 2021, ERA
retained $7.3 million in swap contracts for the 89,594
barrels remaining outstanding.

Note 1: Excludes $1 million (2020: $2 Million) in utilisation of lease costs.

ENERGY RESOURCES OF AUSTRALIA LTD to manage water run off based on ERA’s recent
experience of rehabilitating Pit 1;

(iv) additional costs associated with supplementary

project management and owners team support roles
required to deliver the project;

(v) additional water treatment costs; and

(vi) prolongation costs associated with schedule delays,
such as additional project and site management
costs including water management and power
generation.

Studies have commenced on an alternate methodology for
the capping of Pit 3 utilising methods that indicate a lower
technical risk than ERA’s current approved Mine Closure
Plan. Those studies are expected to take approximately
12 months and will enable further refinement of the
Ranger rehabilitation execution scope, strategy, cost and
schedule. The study will ensure that cost and schedule is
wholistically optimised to reflect the new execution plan
and enable further support in finalising a future funding
solution. ERA is currently undertaking rehabilitation
activities such as the wicking of Pit 3, whilst the study work
is being conducted.

In addition, work has commenced on an assessment of
options to enhance ERA’s project execution capability
to ensure that it is appropriately matched to the
revised scope and complexity of the remaining Ranger
rehabilitation program.

FInAnCIAL PeRFoRmAnCe

ReHABILI tAtIon

At 31 December 2021, the ERA rehabilitation provision is
$1,251 million1.

During the second half of 2021 ERA commenced a major
reforecast of both cost and schedule in relation to the
calculation of the rehabilitation provision and timing for
completion for the Ranger Project Area. To assist with
that reforecast, Bechtel was engaged to perform an
independent review and gap analysis of ERA’s forecast
cost and schedule data. The preliminary findings by ERA
from its reforecast exercise indicates that:

(i) the revised total cost of completing the Ranger Project
Area rehabilitation, including incurred spend from 1
January 2019, is forecast to be approximately between
$1.6 billion and $2.2 billion. The previously announced
closure estimate, which was based on the Ranger
Project Area closure Feasibility Study finalised in 2019
(“Feasibility Study”), was $973 million2; and

(ii) the revised date for completing the Ranger Project

Area rehabilitation is forecast to be between Quarter 4,
2027 and Quarter 4, 2028.

ERA notes that the above revised estimates, as to both
cost and schedule, are based on the Ranger rehabilitation
project being completed in accordance with the
methodology set out in the current Mine Closure Plan.

Key factors contributing to the forecast cost and schedule
overruns include the following:

(i)

(ii)

additional cost and schedule impacts incurred
in tailings transfer and conversion of the Tailings
Storage Facility into a Water Storage Facility;

emergent technical risks and forecast additional cost
and schedule impacts in executing the Pit 3 capping
works using the sub-aqueous wicking and capping
method forming part of the approved Mine Closure
Plan;

(iii) emergent additional scope items and associated

unbudgeted costs, such as additional land forming

Note 1:

Note 2:

31 December 2021 provision discounted at 1.5% per cent and presented in real terms ($1,314 million undiscounted in real terms). This equates to an
estimated $1,379 million in undiscounted nominal terms.
Based on 31 December 2018 rehabilitation provision, ($973 million undiscounted in nominal terms, excluding not yet recognised termination benefits in
line with Australian Accounting Standards and including an allowance of $1 million in relation to the estimated cost of Jabiluka Mineral lease rehabilitation
expense).

ENERGY RESOURCES OF AUSTRALIA LTD oPeRAtIons AnD ReHABILItAtIon

Under the Ranger Authority, ERA was required to cease
mining and processing activities in the Ranger Project
Area by 8 January 2021.

that, in the opinion of the Minister with the advice of the
Commonwealth Supervising Scientist, the rehabilitated
area could be incorporated into the Kakadu National Park.

Accordingly, processing operations at Ranger Mine
ceased on 8 January 2021 with the final drum of uranium
oxide being produced that day. As such only 34 tonnes of
uranium oxide were produced by ERA in 2021.

In 2021, ERA continued the independent oversight
program of process safety management at Ranger.
The Noetic Group conducted one oversight visit to
Ranger Mine to review ERA’s “Process Safety
Management in Transition to Closure” plan. Improvement
opportunities were identified and implemented
progressively across the year.

RAngeR mIne CL osURe PLA n

The Ranger Mine Closure Plan (the Plan) details the
works program and schedule to achieve the closure
objectives set out in the legal framework and the
associated Environmental Requirements.

The inaugural public release of the Plan in June 2018
was a milestone for ERA and followed a rigorous 18
month stakeholder consultation process, including
discussions with the Gundjeihmi Aboriginal Corporation
and the Northern Land Council; as representatives of
the Mirarr Traditional Owners and Northern Territory and
Commonwealth Government agencies. ERA released
a further update to the Plan in October 2020 that was
approved by the Minister in 2021.

In July 2021 ERA announced that it was undertaking a
reforecast of the Ranger rehabilitation cost and schedule
and as of December 2021 this had not been finalised.
With this reforecast still pending completion, submission
of the 2021 MCP was deferred with the agreement of
regulators and key stakeholders. The next update of the
Plan will be completed in 2022, in close consultation with
Governments and key stakeholders.

In line with ERA’s statutory obligations the primary
objective is to rehabilitate the Ranger Project Area to form
one final landform across the site, which will blend in with
the surrounding landscape. ERA plans to establish a fully
functioning landform and ecosystem that is similar to the
surrounding Kakadu National Park.

Under the Ranger Authority ERA must rehabilitate the
Ranger Project Area to establish an environment similar
to the adjacent areas of the Kakadu National Park such

The area of disturbance around the mine footprint
measures approximately 950 hectares, where most of the
rehabilitation work will occur. ERA’s closure plan includes
both progressive rehabilitation and water treatment
activities. Both are based on extensive research,
studies and consultation with stakeholders, with the
key tasks including:

• Treatment of all pond and process water inventories;

• Transfer of tailings from the Tailings Storage Facility to

the exhausted Pit 3;

• Pit 3 remediation, including installation of wicks to
accelerate water expression from tailings, capping
activities followed by bulk backfill;

• Remediation of the Tailings Storage Facility and

contaminated sites;

• Removal and re-shaping of the stockpiles and disturbed
areas of the Ranger Project Area to establish a final
landform; and

• Revegetation of the final landform using locally sourced

native seeds.

Animation of the rehabilitation program available on ERA’s website:
https://www.energyres.com.au/sustainability/closureplan/

The animation of the rehabilitation program provides a
visual overview of the Plan, breaking down the rehabilitation
process into readily understood concepts and a timeline
for the works to be carried out. Due to the support of the
Gundjeihmi Aboriginal Corporation, the animation also
includes a narration in the local Kunwinjku language.

ENERGY RESOURCES OF AUSTRALIA LTD oPeRAtIons AnD ReHABILItAtIon

PRoC ess PLAnt DeC ommIssIonIng/
DemoLI tIon

Following the cessation of operations on 8 January 2021
work commenced on the decommissioning and make-safe
of the processing plant infrastructure. This included the
clean out of processing plant vessels, isolation of services
and air gapping, in preparation for demolition. This work
was completed in July 2021 with the final demolition of the
processing plant being scheduled to coincide with Pit 3 bulk
backfill; the location of its final disposal.

tAILIngs tRA nsFeR

Transfer of tailings from the Tailings Storage Facility to Pit 3
continued throughout 2021. Bulk dredging was completed
in February 2021, following which the remnant tailings were
allowed to dry in preparation for transfer via truck.

Following the construction of a suitable tip head on
Pit 3, transfer of the remnant tailings commenced in
June 2021 and was completed in December 2021. The
Tailings Storage Facility has now been converted into
a water storage facility to hold the site process water
inventory, pending treatment in the Brine Concentrator.

A visual update of the completion of the tailings transfer is
available on ERA’s website: https://www.energyres.com.au/
media/stories/completion-of-bulk-dredging/

BRIne C onCentRAtoR

The Brine Concentrator processes water to produce
purified water and brine (a concentrated waste stream).
The purified water is discharged to the off-site environment
during the wet season, via constructed wetlands. The brine
is either circulated back to the process water inventory,
or permanently disposed of safely in the underfill layer
(deep down in Pit 3).

In early 2021 a major upgrade of the Brine Concentrator
was completed. Peak purified water production rates
following the upgrade met expectations. However,
sustained plant production was subsequently impacted by
a number of unplanned shutdowns due to scaling issues
and interruptions to plant power supply. In 2021, the Brine
Concentrator produced 2,019ML of purified water.

Initiatives undertaken in 2021 to address the number of
unplanned plant shutdowns and improve plant performance
included the change-out of the Brine Concentrator’s diesel
alternators, the installation of a waste heat recovery boiler
and review of plant performance by a third party.

ReHABILI tAtIon oF PI t 1

Bulk material movement to backfill Pit 1 was completed in
2020, with 17 million tonnes of backfill placed over the
750 metre wide Pit 1. Shaping of the final landform was
then completed in preparation for revegetation activities
which commenced in 2021.

The 39.3 hectare site stores mill tailings in Pit 1 as required
by the Ranger Authority. Approximately 7,700 dewatering
wicks were installed in 2012, along with a geotextile
fabric layer and a preload rock layer to compress the
tailings mass. The preload rock layer was capped with an
impervious layer of laterite in 2016 to prevent surface
water infiltration.

Backfilling of Pit 1 was completed in August 2020; two
weeks ahead of schedule and under budget. A video
detailing the completion is available on ERA’s website:
https://www.energyres.com.au/media/stories/ranger-
minesite-pit-1-rehabilitation-and-completionof-bulk-
backfilling/

Revegetation of the Pit 1 final landform surface
commenced in early 2021 and was completed in January
2022. Revegetation activities include seed collection,
nursery propagation, installation of irrigation infrastructure
and manual tube stock planting.

ReHABILI tAtIon oF PI t 3

Prior to tailings being deposited into the mined out Pit 3,
works were completed to prepare the pit to receive tailings
and brine from the Brine Concentrator. The underfill,
consisting of waste rock, was constructed at the base of
the mined out Pit 3 to raise the floor from -265 mRL to
-100 mRL2 (including the drainage layer) providing a broad,
level surface area for tailings deposition. The intent of this
underfill was, in part, to generate a low rate of tailings rise
and to optimise consolidation rates, allowing for minimal
backfill consolidation over time.

Backfill activities for the construction of the underfill
layer were completed in 2014 and transfer of tailings from
both the Mill and Tailings Storage Facility commenced
in 2015. Mill tailings transfer concluded with the end of
processing operations on 8 January 2021, and tailings
transfer from the Tailings Storage Facility was completed
in December 2021.

ENERGY RESOURCES OF AUSTRALIA LTD oPeRAtIons AnD ReHABILItAtIon

During 2021 ERA worked with the Supervising Scientist
and the Northern Land Council to jointly develop and
agree on the plant species that would be considered to
be similar to surrounds and form the basis for the final
landform revegetation plan. This has updated the previous
trial landform species and now forms the basis of the seed
collection program. The most recent planting on Pit 1 final
landform has used this species list.

ERA’s long-term local Indigenous business partner, Kakadu
Native Plants Pty Ltd continued to collect local native
plant seeds and to raise tube stock seedlings suitable for
planting into the final landform throughout 2021. They were
also engaged to complete all the planting on Pit 1.

sUPeRvI sIng sCIentI st BRAnCH

As provided for under a Deed of Agreement between the
Company and the Commonwealth, the Company has
reached an agreement with the Supervising Scientist
Branch for the ongoing funding of research into the
environmental effects of uranium mining in the Alligator
Rivers region.

Throughout 2021 planning for Pit 3 capping works
were progressed. This included the testing of tailings
properties through cone penetration testing, sampling and
analysis, design of the wicking and capping activities and
commercial processes to engage contractors to progress
the works commencing in 2022.

In similar fashion to Pit 1, wicks will be installed into the
tailings mass within Pit 3 and then covered with a geotextile
fabric membrane, prior to initial preload. The current plan is
for bulk backfilling to commence in 2023, followed by final
landform contouring and revegetation.

RevegetAtIon

ERA’s approach to revegetation is informed by its long
running trial landform research, which began in 2009 to
provide for testing of landform design and revegetation
strategies. The trial landform used locally sourced native
plant species, planted out as seed and tube stock into the
type of waste rock to be used in the final landform process.

Of the 40 tree and shrub species that were introduced
on the Ranger trial landform in 2009, and are still present
today, 37 have flowered and fruited at least once in the
last two years. Almost three-quarters of the 40 species
have self-recruited, either via seed and/or vegetative
reproduction (suckering). The three species that have not
flowered are Gardenia megasperma, Owenia vernicosa
and Pandanus spiralis; all of which were direct seeded,
slow growing and are generally still too small to flower
and fruit.

A Leichardt Grasshopper sitting on vegetation planted in 2021 on Pit 1.

ENERGY RESOURCES OF AUSTRALIA LTD BUsIness stRAtegy

ERA’s purpose is to provide clean energy to the world
and care for people and country.

The strategic priority for ERA is the successful
rehabilitation of the Ranger Project Area, with the aim
that the rehabilitated environment will be similar to, and
could be incorporated into, the surrounding Kakadu
National Park. ERA believes this will demonstrate ERA’s
ongoing commitment to long-term sustainable operations
in the region, creating a positive legacy that will underpin
potential future growth opportunities.

During the second half of 2021 ERA announced and
commenced a major reforecast of both cost and schedule
in relation to the calculation of the rehabilitation provision
and timing for completion for the Ranger Project Area.
To assist with that reforecast, Bechtel was engaged to
perform an independent review and gap analysis of ERA’s
forecast cost and schedule data.

This process has identified that existing cash resources
and expected future cash resources will be inadequate
to fully fund rehabilitation.

Consequently ERA’s near-term strategic priorities are:

• Secure a suitable funding option to meet future

rehabilitation obligations;

• Complete rehabilitation of the Ranger Project Area;

• Maximise the generation of cash flow from the

remaining inventories of drummed uranium oxide; and

• Preserve optionality over the Company’s undeveloped

resources.

A key constraint for ERA is the Atomic Energy Act 1953
which currently requires completion of rehabilitation
activities by January 2026. ERA has been engaging with
Government and key stakeholders to amend the Atomic
Energy Act 1953 and extend the expiry date of ERA’s
tenure on the Ranger Project Area.

In addition to Ranger, ERA holds title to the Jabiluka
Mineral Lease; a large, high quality uranium ore body of
global significance. The carrying value of the Jabiluka
Undeveloped Property was recorded at approximately
$90 million as at 31 December 2021.

In accordance with the Long Term Care and Maintenance
Agreement, the Jabiluka deposit will not be developed by
ERA without the approval of the Mirarr Traditional Owners.

ENERGY RESOURCES OF AUSTRALIA LTD BUsIness RIsks

A number of risks and uncertainties, which are both specific
to ERA and of a more general nature, may affect the future
operating and financial performance of ERA and the value
of ERA shares. This section describes some, but not all,
of the material ERA business risks and uncertainties.
The risks and uncertainties described below are not the
only ones facing ERA. Additional risks and uncertainties
that ERA is unaware of, or that it currently considers to
be immaterial, may also become important factors that
adversely affect ERA’s business and its financial position
and performance.

ReHABILI tAtIon

In accordance with applicable Commonwealth and
Northern Territory Government statutory requirements,
ERA ceased mining and processing activities at the
Ranger Project Area on 8 January 2021 and is progressing
rehabilitation of the site.

Calculating the rehabilitation provision for the Ranger
Project Area requires significant estimation and judgement
by ERA. Assumptions are made in respect of methods of
rehabilitation, costs and timing, as well as the potential
for changes in legal requirements, technological changes,
environmental conditions, weather events and market
conditions. The most significant components of the
provision relate to material movement, water treatment,
Pit 3 backfill, demolition and revegetation. Any significant
change to the components and schedule of activities to
implement closure and rehabilitation may adversely affect
the cost, timing and completion of the rehabilitation in
accordance with applicable Commonwealth and Northern
Territory statutory requirements.

Ultimately, the cost of rehabilitation of the Ranger Project
Area is uncertain and may be materially more or less
than the current rehabilitation estimate. While ERA has
used its best estimate, rehabilitation costs may increase
in response to factors beyond ERA’s control, including
amended legal requirements, technological changes,
environment conditions, weather events, market conditions
and border restrictions due to COVID-19.

As a result of the increase in rehabilitation provision,
ERA has commenced an assessment of potential funding
options. An inability to obtain sufficient funding would have
a material impact on ERA’s business, financial performance
and assessment as a going concern. Rio Tinto has
reiterated its commitment to ensuring the rehabilitation
of the Ranger Project Area is successfully achieved
to a standard that will establish an environment similar

to the adjacent Kakadu National Park. ERA has
commenced discussions with major shareholders
about a funding solution.

wAteR tReAtment AnD mA nAgement

Management of water on the Ranger Project Area is critical
to the rehabilitation activities. ERA has implemented a
number of procedures and initiatives in respect to water
management, including the recent project to upgrade
the capacity of the Brine Concentrator which was
commissioned in February 2021. To the extent that these
initiatives cost more than expected or ERA is required to
implement further initiatives (such as the installation of
additional water treatment infrastructure), the rehabilitation
provision may increase further.

The Ranger Project Area is subject to the extreme
contrast of weather conditions that exist in the Northern
Territory. The extent of each wet season can have a
significant impact on ERA’s rehabilitation activities. Wet
seasons that exceed long term averages will have a
material adverse effect on ERA’s ability to implement
water management and on its ability to meet its other
rehabilitation initiatives and, accordingly, affect ERA’s
financial position and performance.

RAngeR ReHABILI tAtIon tRUst FUnD

Each year, ERA is required to prepare and submit to
the Commonwealth Government an Annual Plan of
Rehabilitation. Once accepted by the Commonwealth
Government, the Annual Plan is then independently
assessed and costed and the amount to be provided by
ERA into the Ranger Rehabilitation Trust Fund (Trust
Fund) is then determined. The Trust Fund includes both
cash and financial guarantees.

ERA’s ability to continue to access these financial
guarantees can be influenced by many factors, including
future cash balance, cash flows and shareholder support.
Issuers of the guarantees have certain, pay and walk,
rights and the guarantees are subject to periodic reviews.
Should the banks execute their, pay and walk, rights or
ERA is unable to access bank guarantees, substantial
additional cash would be required to indemnify the banks
or be deposited into the Trust Fund. The balance of
bank guarantees and cash held by the Commonwealth
Government is currently $660 million ($125 million bank
guarantees and $535 million cash on deposit).

The mechanism for drawdown of security in the Trust
Fund as rehabilitation work progresses is currently

ENERGY RESOURCES OF AUSTRALIA LTD BUsIness RIsks

the subject of discussions between ERA and the
Commonwealth Government. The mechanism and
approach will require review and approval by the
Commonwealth Government.

Should the relevant Minister seek to increase the
Trust Fund balance before a suitable funding solution
is established, a funding shortfall may result. The
Trust Fund is disclosed as government security
receivable in the Financial Statements.

tAILIngs C onsoLIDAtIon

Following the completion of the transfer of tailings to
Pit 3, the final capping of Pit 3 will commence. During
the capping process the tailings in Pit 3 will consolidate
and express process water that will need to be collected
and treated. The consolidation process will be aided by
installing vertical wicks, with the forecast consolidation
timeframes backed up by a detailed model based on
in situ testing of site tailings. The consolidation model
accuracy and predictions of rates of process water
expression is impacted by many factors, including tailings
density and other characteristics, deposition method and
free process water volume in the pit during deposition.

ERA continues to monitor the rate of tailings consolidation
in Pit 3 compared to the consolidation model assumed
for the purposes of the rehabilitation Feasibility Study.
While there is a greater proportion of process water
being retained within the tailings than planned, detailed
engineering continues to further refine the scope of work.
The impact to the rehabilitation provision, if any, will be
further evaluated as part of the assessment of alternate
capping options for Pit 3.

PRoC ess wAteR sALt DIsPosAL

As a result of treating processed water a waste stream
of contaminated salt is generated. The salt is ultimately
to be stored below tailings in Pit 3 via injecting the brine
through bore holes. This technology has previously been
commissioned but the long-term performance is yet to
be fully confirmed. Should the disposal of salt in this
manner not prove viable, an alternate method of salt
disposal would be required. This would require additional
capital expenditure which has not been allowed for in the
provision and may not be available to ERA.

ACCess to CAPI tAL RIsk

The future liquidity and capital requirements of the

Company will depend on many factors. As noted above,
following the increase in the rehabilitation provision,
the Company requires an additional source of funding
to fully meet the estimated costs of the rehabilitation of
the Ranger Project Area and is continuing to review all
funding options.

ERA has insufficient funds to fully fund rehabilitation. Any
inability to obtain additional capital or to monetise assets
would have a materially adverse effect on ERA’s ability to
meet its rehabilitation obligations as well as its business
and its financial position and performance. If ERA does
not have sufficient funding to support its continued
operations and rehabilitation of the Ranger Project Area,
ERA may be unable to meet its liabilities as and when
they fall due and its ability to continue as a going concern
may be impacted.

On 29 April 2016, the Company entered into a $100
million Loan Agreement with North Limited (a wholly-
owned subsidiary of Rio Tinto) in support of ERA’s
rehabilitation obligations should additional funding
ultimately be required. This agreement currently remains
in place and is undrawn. Drawdown of the credit facility
under the Loan Agreement is subject to ERA being able
to demonstrate at the time of drawdown that it satisfies
customary conditions precedent as mentioned in the
“credit facility agreement” announcement released on
29 April 2016.

The Loan Agreement contains a review mechanism which
is triggered if, before the first drawdown, the estimated
rehabilitation cost increases by $12.5 million or more
for reasons other than external factors or issues beyond
ERA’s reasonable control. The review mechanism
ultimately provides Rio Tinto with a right to terminate the
Loan Agreement if the parties cannot agree a satisfactory
path forward following such an increase in the estimated
rehabilitation cost. Following the recent announcement
of the overrun of cost a “Review Event” may or may not
have occurred under the current terms of the facility
and therefore Rio Tinto may not be obliged to advance
loans. If the Loan Agreement is terminated then it may
have a material adverse effect on ERA’s ability to meet
its rehabilitation obligations as well as its business and
financial position and performance.

ENERGY RESOURCES OF AUSTRALIA LTD BUsIness RIsks

RegULAtoRs AnD stAkeHoLDeR s

geneRAL RegULAtoRy RI sks

The Mine Closure Plan is subject to ongoing review and
refinement, with ERA required to review and submit an
updated Plan for regulatory approval each year. In addition,
regulatory approvals are required in order to carry out certain
rehabilitation activities. If these regulatory approvals are
not obtained or are obtained with unsatisfactory conditions,
ERA’s ability to complete the rehabilitation program in a
timely and cost effective manner will be at risk.

The Plan builds on more than 20 years of scientific work
undertaken on the progressive rehabilitation at Ranger
and was developed by reference to the Western Australian
Mine Closure Plan Guidelines (in the absence of relevant
Northern Territory closure plan guidelines). It also includes
proposed closure criteria for the Ranger mine which
addresses the key themes of the final landform, radiation,
water, flora and fauna, soils and cultural heritage.

ERA first released the Plan to the public in June 2018,
following an intensive stakeholder engagement process with
all key stakeholders which commenced on the provision
of a draft Plan in December 2016. Key stakeholders who
provided feedback on that draft and subsequent annual
updates included the Gundjeihmi Aboriginal Corporation
and Northern Land Council (as representatives of the
Mirarr Traditional Owners) and Northern Territory and
Commonwealth Government agencies.

In October 2020, the latest updated Plan was released and
was approved by the Commonwealth and NT Governments
in September 2021. The Plan will continue to be updated in
close consultation with Traditional Owner representatives,
regulators and key stakeholders and formally submitted
to the relevant Northern Territory and Commonwealth
Ministers for approval in compliance with the Northern
Territory Authorisation. The 2021 update to the Plan was
carried over into 2022 pending outcomes of the reforecast
process currently underway.

With respect to Jabiru, ERA sub-leased properties have
transitioned to Gundjeihmi Aboriginal Corporation Jabiru
Town (GACJT). ERA has been granted a license to
30 June 2022 to access those previously sub-leased
properties and is undertaking an extensive rectification
program with a number of houses transitioned to third
parties. The terms and any associated costs of any future
license extension are not yet known and will be subject to
the approval of GACJT.

Uranium mining in Australia is extensively regulated by
Commonwealth and State or Territory Governments.
The areas of uranium mining that are regulated include
exploration, development, production, transport, export,
taxes and royalties, labour standards, occupational
health, waste disposal, protection and rehabilitation of
the environment, mine reclamation, mine safety, toxic
and radioactive substances and native title. In particular,
the approval processes for uranium mining are more
onerous, and therefore more costly, than for the mining
of other minerals.

The mining and export of uranium is currently permitted
under strict international agreements designed to prevent
nuclear proliferation. The export of uranium is tightly
controlled by the Commonwealth Government through
its licensing process and Australian uranium can only
be exported to countries that have signed the nuclear
non-proliferation treaty. Government actions in Australia
and other jurisdictions in which ERA has interests, including
new or amended legislation, guidelines and regulations
in relation to the environment, uranium or nuclear power
sectors, competition policy, native title and cultural heritage
could impact ERA’s operations.

Operational and rehabilitation aspects that may be affected
include, among other things, land access rights, the
granting of licenses and other tenements and the approval
of developments.

Future legislation and changes in the regulatory framework
could cause additional expense, capital expenditures,
restrictions and delays in the rehabilitation and potential
development of ERA’s assets; the extent of which cannot
be predicted. Any such government action may require
increased capital, rehabilitation or other expenditures and
could prevent or delay certain activities by ERA, which
could have a material adverse effect on ERA’s business
and its financial position and performance, as well as its
ability to meet its rehabilitation obligations.

Uranium mining in the Northern Territory is regulated
through a suite of Commonwealth and Northern Territory
legislation. Certain agreements and approvals have
also been reached with the Mirarr People who are the
Traditional Owners of the land on which the Ranger Project
Area and Jabiluka is situated.

ENERGY RESOURCES OF AUSTRALIA LTD The Jabiluka Mineral Lease is currently held subject to
a Long Term Care and Maintenance Agreement with the
Mirarr Traditional Owners. This agreement provides that
the Jabiluka deposit will not be developed without the
consent of the Traditional Owners. It is uncertain whether
this consent will be forthcoming and, by extension, if the
Jabiluka deposit will be developed. Should this consent
not eventuate in the future, the Jabiluka Undeveloped
Property would face full impairment.

The Jabiluka mineral lease is due for renewal in 2024.
This renewal has been considered in determining its
carrying value in the financial statements.

Prospective developments may also require significant
additional funding. If ERA elects to proceed with any
prospective mining or exploration opportunities, there
is no guarantee that it will be able to raise sufficient
additional capital at a cost that is economically viable.

URAnIUm mARket DemA nD, PRICe AnD
FoReIgn exCHA nge RIsks

ERA has completed all contracted sales and a substantial
sell down of remaining uranium inventories. ERA will
continue to maximise the value from its uranium holdings
through opportunistic spot sales. Consequently, currency
and global uranium market fluctuations may materially
affect ERA’s financial performance. Demand for, and
pricing of, uranium oxide remains sensitive to external
economic and political factors, all of which are beyond
ERA’s control; including worldwide uranium supply and
demand, regional political developments in uranium
producing and nuclear power generating countries and
regions (including potential for trade sanctions), and the
price and availability of competing power generating
technologies. Accordingly, it is not possible to predict
future uranium price movements with certainty. Global
uranium and foreign exchange market fluctuations may
materially effect ERA’s financial performance.

BUsIness RIsks

The Ranger Mine Closure Plan is subject to ongoing review
and refinement, with ERA ordinarily required to review
and submit an updated Plan for regulatory approval each
year. In addition, regulatory approvals are required in
order to carry out certain rehabilitation activities. If these
regulatory approvals are not obtained in a timely manner
or are obtained on unsatisfactory conditions, ERA’s ability
to complete the rehabilitation program in a timely and cost
effective manner will be at risk and ERA’s business and
its financial position and performance may be materially
adversely affected.

UnDeveL oPeD ResoURC es

The Company ceased processing stockpiled ore on 8
January 2021, as required under the Ranger Authority.
The Company has significant undeveloped uranium
deposits at Ranger 3 Deeps and Jabiluka.

Given the current Ranger Authority requirement for
cessation of processing on 8 January 2021 and the
uranium market environment, the Ranger 3 Deeps project
faces material barriers to development.

Amendments to legislation to affect an extension of the
Ranger Authority would be required to manage the gap
between the cessation of processing at 8 January 2021
and the commencement of Ranger 3 Deeps production
at a later point. This gap, together with an extensive care
and maintenance program for the mill and a required
pause on rehabilitation activities, would add fixed cost to
the operation, further materially challenging the Ranger 3
Deeps Project’s viability.

Consequently, in August 2021 ERA completed backfill
works on the Ranger 3 Deeps decline.

At present, no work is being conducted on further
development options for the Ranger 3 Deeps deposit.

While the deposit remains in the ground and therefore
available for extraction should future economic and
regulatory conditions support, amendments to legislation
to effect an extension of the Ranger Authority would be
required. The economics of the project at that stage would
be required to support a standalone mill and tailings
construction amongst other infrastructure.

ENERGY RESOURCES OF AUSTRALIA LTD BUsIness RIsks

envIRonmentAL RI sk

Post 2026 tenURe RI sk

Under the Atomic Energy Act 1953, ERA’s access to
the Ranger Project Area ceases on 8 January 2026.
During 2021 Traditional Owner representatives, the
Commonwealth and ERA discussed steps required to
enable ERA to access the Ranger Project Area after this
date to complete outstanding rehabilitation activities and
for monitoring purposes. This will require an amendment
to the Atomic Energy Act 1953 and then there will be
a need to negotiate the terms of these future tenure
arrangements.

A condition of the Ranger Authority is that ERA must
rehabilitate the Ranger Project Area to establish an
environment similar to the adjacent areas of Kakadu
National Park such that, in the opinion of the Minister with
the advice of the Supervising Scientist, the rehabilitated
area could be incorporated into the Kakadu National Park.

While substantially complete and agreed, certain closure
criteria relating to environmental matters for Ranger are
still to be finalised and agreed to by the stakeholders
(including, in particular, the Ranger and Jabiluka Minesite
Technical Committees). The ability for ERA to meet its
Ranger closure and rehabilitation obligations requires
careful management of various environmental conditions
into the future, including preventing:

• Pond and process water being discharged to the

environment;

• Impact of surface water on groundwater under the site

and on the surrounding environment;

• Impact of salt accumulation in dry watercourses during

the dry season;

• Weeds, feral animals and fire from the Kakadu National

Park encroaching the Ranger Project Area; and

• Release, spillage and impact on the surrounding

environment of hazardous materials such as radioactive
material, diesel and acid.

If these environmental conditions are not satisfactorily
managed, ERA’s ability to complete the rehabilitation
program in a timely and cost effective manner will be at
risk and ERA’s business and its financial position and
performance may be materially impacted.

ENERGY RESOURCES OF AUSTRALIA LTD Internal approval of Ore Reserves and Mineral Resources
for ERA is the responsibility of the Chief Executive and
estimates are carried out by a Competent Person, as
defined by the JORC Code 2012.

As part of its internal controls, ERA applies the standards
of the Rio Tinto Ore Reserves Steering Committee
(ORSC) in the generation and publication of Mineral
Resources and Ore Reserves. The ORSC comprises
senior representatives from technical, financial and
business fields within the Rio Tinto Group and meets on
a quarterly basis.

The ORSC’s role includes setting the standards and
qualifications for Competent Persons in accordance with
the JORC Code 2012, which form the basis of Competent
Person appointment by ERA. Rio Tinto’s Resource
and Reserve internal audit program is conducted by
independent external consulting personnel in a program
managed by Rio Tinto Group Audit and Assurance with
the assistance of the ORSC.

Rio Tinto has continued the development of internal
systems and controls to ensure compliance with the
JORC Code 2012 in all external reporting, including the
preparation of reported data by ERA’s Competent Person.

Other improvements introduced by the ORSC include
a web-based reporting and sign-off database, annual
internal Competent Person reports and Competent Person
development and training.

FUtURe sUPPLy

evALUAtIon AnD exPLoRAtIon

There was no evaluation or exploration expenditure for
2021. ERA suspended the final stage of the surface
exploration program on the Ranger Project Area in 2015
to preserve cash following the deferral of the Ranger 3
Deeps project.

RAngeR 3 DeePs ReseRves A nD
ResoURC es

Given the current Ranger Authority requirement for
cessation of processing on 8 January 2021 and the
uranium market environment, the Ranger 3 Deeps
project faces material barriers to development. Due
to ongoing constrained market conditions the project
remains uneconomic. Consequently, in August 2021 ERA
completed backfill works on the Ranger 3 Deeps decline.

At present, no work is being conducted on further
development options for the Ranger 3 Deeps deposit.

In 2020, ERA ceased recognition of the Ranger 3 Deeps
Mineral Resource.

RAngeR ReseRves A nD ResoURC es

Following the conclusion of processing activities on
the Ranger Project Area, as required under the Ranger
Authority, ERA has no remaining Ranger Reserves and
Resources.

JABILUkA ReseRves A nD ResoURC es

In 2005 ERA entered into a Long Term Care and
Maintenance Agreement in relation to the Jabiluka Mineral
Lease. Jabiluka is a large, high quality uranium ore body of
global significance and remains one of ERA’s key assets.
Future mining developments at Jabiluka will not occur
without the consent of the Mirarr Traditional Owners.

The Jabiluka estimated Mineral Resource is 137,100
tonnes of uranium oxide at a cut-off grade of 0.2% U3O8.

goveRnA nCe

ERA’s Competent Person (as defined in the following
pages) is an employee of ERA. The ERA Board oversees
the governance of Resources and Reserves. This
includes the annual review and approval of the publicly
reported Ore Reserves and Mineral Resources Statement.

ENERGY RESOURCES OF AUSTRALIA LTD FUtURe sUPPLy

JABILUkA mIneRAL ResoURC es

Measured

Indicated

Sub-total Measured and Indicated

Inferred Resources

Total Resources

Rounding difference may occur.

As At 31 DeC emBeR 2021
CUt-oFF g RADe
0.20% U3o8

As At 31 DeC emBeR 2020
CUt-oFF g RADe
0.20% U3o8

oRe (mt)

% U3o8

t U 3o8

oRe (mt)

% U3o8

t U 3o8

1.21

13.88

15.09

10.00

25.10

0.89

0.52

0.55

0.54

10,800

72,200

82,900

54,000

0.55

137,100

1.21

13.88

15.09

10.00

25.10

0.89

0.52

0.55

0.54

10,800

72,200

82,900

54,000

0.55

137,100

ComPetent PeR sons

Jabiluka Ore Reserves and Mineral Resources are
reported in accordance with the Australasian Code for
Reporting of Exploration Results, Mineral Resources and
Ore Reserves, 2012 Edition (JORC Code 2012).

The JORC Code 2012 envisages the use of reasonable
investment assumptions, including the use of projected
long term commodity prices, in calculating reserve
estimates.

As required by the Australian Securities Exchange
(ASX), the above table also contains details of other
mineralisation that has a reasonable prospect of being
economically extracted in the future, but which is not yet
classified as Proven or Probable Reserves.

This material is defined as Mineral Resources under the
JORC Code 2012. Estimates of such material are based
largely on geological information, with only preliminary
consideration of mining, economic and other factors.

While in the judgement of the Competent Person there
are realistic expectations that all or part of the Mineral
Resources will eventually become Proven or Probable
Reserves there is no guarantee that this will occur, as the
result depends on further technical and economic studies
and prevailing economic conditions in the future.

The information in the table is sourced from the ERA 2021
Annual Statement of Reserves and Resources which was
released to ASX on 28 February 2022 and can be found
at: http://clients3.weblink.com.au/pdf/ERA/02492685.pdf

Neither the information that relates to Jabiluka Mineral
Resources or Ore Reserves, nor the underlying resource
models, have changed since the ERA 2021 Annual
Statement of Reserves and Resources was disclosed to
the ASX.

ERA is not aware of any new information or data beyond
the updates already provided to the market that materially
affects the Ore Reserves and Mineral Resources estimate.

All assumptions and technical parameters underpinning
the estimates continue to apply and have not materially
changed. The information in this report that relates to
Jabiluka Ore Reserves and Mineral Resources is based
on information compiled by geologist Stephen Pevely, an
employee of ERA.

Stephen Pevely is a member of the Australasian Institute
of Mining and Metallurgy and has sufficient experience
relevant to the style of mineralisation and the type of
deposit under consideration, and to the activity being
undertaken, to qualify as a Competent Person as defined
in the JORC Code 2012.

Stephen Pevely consents to the inclusion in this report
of the matters based on his information in the form and
context in which it appears.

Summary data for year end 2020 are shown for
comparison. Metric units are used throughout. The figures
used to calculate reserves and resources are often more
precise than the rounded numbers shown in the tables,
hence small differences may result if the calculations are
repeated using the tabulated figures.

ENERGY RESOURCES OF AUSTRALIA LTD
sALes AnD mARketIng

During 2021, ERA completed its final sales into existing
long term contracts. This has increased exposure to the
spot market, into which ERA has opportunistically sold
down uranium holdings. ERA will likely sell remaining
stocks into the spot market in 2022.

ERA sells uranium via a sales and marketing agreement
with Rio Tinto Uranium. ERA is currently finalising an
extension to the marketing agreement with Rio Tinto
Uranium to facilitate sales of residual holdings under the
existing terms and conditions.

The average realised price compares favourably against
the average spot price for 2021 of US$35.25 per pound.

The uranium spot price strengthened significantly in the
second half of 2021, with a closing December spot price
of US$42.05 per pound; approximately 39% per cent
higher than the closing December 2020 spot price.

ERA’s customers and end users, located in the United
States of America, Europe, Canada, China and South
Korea, use ERA’s product as fuel to generate low
emissions power.

Meg Parry and Ping Lu during field studies on the
rehabilitated Pit 1 at Ranger.

ENERGY RESOURCES OF AUSTRALIA LTD HeALtH AnD sAFety

At ERA, we care for people and their safety comes first.
It is central to workplace culture and operational activities.

ERA’s safety goals, accountabilities and systems are
articulated in ERA’s Health, Safety and Environment
Management System, which is certified to Australian
(AS4801) and international (ISO14001) standards and
are subject to regular review.

mentAL HeALtH & weLL BeIng

ERA implemented a number of programs throughout
2021 with the objective of maximising the mental health
and wellbeing of the ERA workforce. This included the
provision of onsite access to an Employee Assistance
Program for face to face counselling, plus facilitation of
the ERA Peer Support Program.

A key performance measure at ERA is the All Injury
Frequency Rate (AIFR). AIFR measures the frequency
of all recordable injuries – lost time injuries, restricted
work injuries and medical treatment cases – per 200,000
hours worked.

In response to the COVID-19 pandemic, ERA launched a
recruitment drive for new peer supporters to join the ERA
Peer Support Program, as well as facilitating both leader
and workforce mental health and wellbeing workshops
delivered by an external mental health consultant.

In 2021, ERA achieved an AIFR of 0.00 (2020: 0.53,
2019: 1.07, 2018: 0.56; 2017: 1.17).

During the year ERA experienced no recordable injuries.

The importance of safety leadership and safety
awareness was highlighted throughout the year. These
initiatives included the leadership success program,
leadership in the field, peer support, mental wellness
programs, PhysioAssist and several workshops on
other health and safety issues.

CovID-19 sAFety

ERA maintained COVID-19 controls in line with ERA’s
COVID-19 Management Plan in 2021 in response to the
ongoing global pandemic. ERA was able to continue to
safely complete closure rehabilitation activities throughout
2021 despite interstate border restrictions and state-based
lock-downs.

ERA has processes in place to proactively guide
appropriate workplace behaviours, as well as the myVoice
program that provides an opportunity for employees to
report occurrences of bullying or harassment. Each case
is carefully investigated with the objective of ensuring that
ERA continues to be a safe workplace where employees
can deliver to their full potential.

sAFety mAtURIty moDeL

The Safety Maturity Model (SMM) is a global Rio Tinto
initiative that drives behaviours and activity to deliver
effective safety performance across the three pillars of
the Safety Strategy – fatality elimination, reducing injuries
and illnesses and catastrophic event prevention.

The model is based upon Leadership Engagement, creating an enabling environment in the
areas of Risk Management, Learning and Improving and Work Planning and Execution.

Leadership and
Engagement

– Creating an enabling
environment

Risk Management
– Understanding and controlling risk

Learn and Improve
– Striving to do better every shift

Work Planning and Execution
– Operational practices and routines

ENERGY RESOURCES OF AUSTRALIA LTD HeALtH AnD sAFety

The SMM is in its third year of the program, which
commenced implementation in 2019.

A number of SMM initiatives that were implemented at
ERA included leadership training, targeted leadership
in the field, Process Safety into Closure, Rio Tinto
Behaviours program and ERA’s Recognition Awards that
celebrate contributions to ERA’s priorities, including safety
and health.

PRoC ess sAFety

ERA maintained a control-based approach to managing
high consequence, low probability incidents via the
ERA Process Safety Management program in 2021.
Actions from the Process Safety Transition to Closure
Plan were progressively implemented across 2021.
An oversight visit was conducted by Noetic; ERA’s
independent Process Safety Consultant. Areas for
improvement were identified and remediating actions put
in place to continue adaptation of ERA’s process safety
program to be fit for purpose in a closure rehabilitation
setting. A Rio Tinto Process Safety Audit was completed
in 2021 to support the implementation of the Rio Tinto
Process Safety Standard.

AUDIts

ERA’s integrated Health, Safety and Environment
Management System provides certification to both ISO
14001 (the international standard for environmental
management systems) and AS4801 (the Australian
standard for occupational health and safety management
systems). In 2021, planned audits of the system were
conducted by Bureau Veritas. Surveillance audit number
one was conducted in February and a second surveillance
audit was conducted in December 2021. Action plans
were put in place to address findings ahead of an ISO
HSE Management System recertification audit in 2022.

ERA underwent a Rio Tinto Process Safety audit in
February 2021, a Noetic Process Safety Oversight visit in
July 2021 and a Rio Tinto Safety Maturity Assessment in
November 2021.

emeRgenCy ResPonse

Building ERA’s Emergency Response Team skills and
capabilities continued to be a focus during 2021.

The team comprises of: 1 Emergency Services
Supervisor, 6 Emergency Services Officers and 13
Emergency Response Team workforce volunteers, who
are trained to respond immediately to incidents such as
evacuation, fires or vehicle accidents. The Emergency
Response Team also responds to offsite incidents,
providing support in the event of regional events such
as fire or motor vehicle accidents. Contract Emergency
Services Officers are also engaged as required to ensure
adequate emergency services coverage.

ERA has invested in specialist training for team members
and has also been actively recruiting and training
new members.

RADIAtIon monI toRIng

ERA monitors radiation at Ranger in accordance with
the Company’s Radiation Policy and Radiation
Management Plan.

The desired performance outcomes are described in
ERA’s Health, Safety and Environment Management
System, which is certified to Australian (AS4801) and
international (ISO14001) standards.

Monitoring results are compared to limits recommended
by the International Commission on Radiological
Protection (ICRP) for occupationally exposed persons
as adopted by Australian legislation.

ERA employees and contractors whose occupational
exposure to radiation may exceed 5 millisieverts (mSv)
per year are declared ‘designated’ workers and their
exposure is more stringently monitored.

To ensure the highest possible quality control on radiation
doses, the results are reviewed internally by ERA and
externally by the Company’s regulators. ERA provides
quarterly occupational radiation dose data for designated
workers at Ranger mine to the Australian Government’s
Australian National Radiation Dose Register (ANRDR).

ENERGY RESOURCES OF AUSTRALIA LTD HeALtH AnD sAFety

The maximum and mean annual radiation doses received
by designated workers and the maximum radiation
doses received by non-designated workers during 2021
will be reported in the 2021 Annual Ranger Mine and
Ranger 3 Deeps Radiation Protection and Atmospheric
Monitoring Report.

Preliminary analysis of the available dose results for 2021
indicates that all occupational and public radiation doses
remain well below the national and international dose
limits. The resulting contribution from the Ranger Mine
remains very low in comparison to both the public dose
limit and the natural background radiation level.

The tables on this page provide a summary of maximum
and mean annual radiation doses received by designated
and non-designated workers for the first three quarters of
2020 and 2021.

Historically the theoretical contribution from the Ranger
mine has been, on average, approximately 0.02 mSv
(or two per cent) of the 1 mSv member of the public dose
limit and less than one per cent of the natural background
radiation level in Australia of between 2 and 3 mSv.

2020

2021

DESIGNATED WORKERS (mSv)

NON DESIGNATED WORKERS (mSv)

Mean

0.31

0.32

0.35

Max

0.91

0.95

0.96

Mean

0.12

0.11

0.16

Max

0.32

0.36

0.30

DESIGNATED WORKERS (mSv)

NON DESIGNATED WORKERS (mSv)

Mean

0.33

0.38

0.35

Max

1.81

0.98

1.07

Mean

0.11

0.12

Max

0.30

0.37

ENERGY RESOURCES OF AUSTRALIA LTD RegULAtoRy FRAmewoRk

Uranium mining activities in Australia are strictly regulated
by the Commonwealth and State or Territory Governments.

The purpose of these regulations is to ensure uranium
mining performance and compliance in a range of critical
areas, including: health and safety, process safety, safe
management of toxic and radioactive substances, waste
disposal, transport safety, export controls, protection and
rehabilitation of the environment, native title, exploration
and development, taxes and royalties, labour standards
and mine reclamation.

International agreements designed to prevent nuclear
proliferation also govern the mining and export of uranium.

Exports are subject to strict safeguards and conditions
to ensure that Australian uranium is only used for
peaceful purposes.

RegULAtIon oF eRA’s oPeRA tIons

Commonwealth and Northern Territory legislation provide
the regulatory framework for ERA’s uranium mining
activities, including rehabilitation.

ERA’s activities on the Ranger Project Area and Jabiluka
Lease (MLN1) are closely supervised and monitored by key
statutory bodies and stakeholder organisations including:

• Northern Territory Department of Industry, Tourism

and Trade (DITT), the Commonwealth Department of
Industry, Science, Energy and Resources (DISER), the
Commonwealth Supervising Scientist Branch (SSB),
the Gundjeihmi Aboriginal Corporation (GAC) and the
Northern Land Council (NLC) representing the Mirarr;

• Alligator Rivers Region Advisory Committee (including
non-government organisation representatives); and

• Alligator Rivers Region Technical Committee (including

non-government organisation representatives).

The Ranger and Jabiluka Minesite Technical Committees
- made up of ERA, DITT, SSB, GAC and NLC (with DISER
as observers) – are the key forums for approvals on
environmental matters relating to Ranger and Jabiluka.

The Alligator Rivers Region Advisory Committee (ARRAC)
provides a formal forum for consultation on matters relating
to the effects of uranium mining on the environment in
the region.

Committee members include representatives of the
Northern Territory Government, the Commonwealth
Government, the Northern Land Council, Aboriginal
associations, mining companies (including ERA),
West Arnhem Regional Council, the Northern Territory
Environment Centre and other members who may
be appointed by the Commonwealth Minister for the
Environment.

Further information on ARRAC can be obtained at:
http://www.environment.gov.au/science/supervising-
scientist/communication/committees/arrac

The Alligator Rivers Region Technical Committee (ARRTC)
also oversees the nature and extent of research being
undertaken to protect and restore the environment in the
Alligator Rivers Region from any effects of uranium mining.

The 10 ARRTC members include independent scientists
nominated by the Federation of Australian Scientists
Branch and Technological Societies with the remaining
representatives being drawn from the Commonwealth
Supervising Scientist Branch, Northern Territory
Government, Uranium Equities Ltd, Northern Land
Council, Parks Australia and an environmental
non-government organisation.

Further information on ARRTC can be contained at:
https://www.awe.gov.au/science-research/supervising-
scientist/communication/committees/arrtc

InteRnAtIonAL AnD AUstRALIA n
CeRtIFICAtIon

ERA maintains international certification (ISO 14001) of
its Health, Safety and Environment Management System,
which includes the Company’s Water Management System.

ERA also maintains Australian certification (AS4801) of
its Health, Safety and Environment Management System
including the Ranger Radiation Management System.

ENERGY RESOURCES OF AUSTRALIA LTD FInAnCIAL
RePoRt

Contents

DIRECTORS’ REPORT

AUDITOR’S INDEPENDENCE DECLARATION

CORPORATE GOVERNANCE STATEMENT

STATEMENT OF COMPREHENSIVE INCOME

BALANCE SHEET

STATEMENT OF CHANGES IN EQUITY

CASH FLOW STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

DIRECTORS’ DECLARATION

INDEPENDENT AUDITOR’S REPORT

SHAREHOLDER INFORMATION (UNAUDITED)

101

2021 ASX ANNOUNCEMENTS (UNAUDITED)

103

eneRgy ResoURCes oF AUstRALIA LtD 27

DIReCtoRs' RePoRt

DIReC toRs

PeteR mA nseLL

BRAD weLsH

PAUL DowD

InDePenDent non-exeCUtIve
CHAIRmA n

CHIeF exeCUtIve A nD mA nAgIng
DIReC toR

InDePenDent non-exeCUtIve
DIReC toR

BCom, LLB, H. Dip. Tax, FAICD

LLB, MMINENG

Bsc (Eng), FAusIMM, MAICD

Mr Welsh was appointed as Acting Chief
Executive of ERA in October 2021 and
Chief Executive and Managing Director on
18 February 2022.

Mr Welsh is from the Muruwari tribe in
north-western New South Wales, and grew
up in the Aboriginal community of Redfern,
Sydney. Prior to joining ERA, Mr Welsh
was the Chief Advisor Closure Strategy
Non-Managed Assets with Rio Tinto.
Mr Welsh’s previous roles include Chief
Advisor Indigenous Affairs with Rio Tinto
and Acting General Manager of the Weipa
bauxite operation in Northern Queensland
which made Mr Welsh the first Indigenous
general manager operations in Rio Tinto’s
history.

Mr Dowd was appointed as an
independent Non-Executive Director of
ERA in October 2015.

Mr Dowd is also Chair of the Sustainability
Committee and Rehabilitation Committee,
and a member of the Audit and Risk
Committee and Remuneration Committee.

Mr Dowd is a mining engineer with more
than 50 years’ experience in the mining
industry, primarily in the private sector,
but also serving in the public sector
as head of the Victorian Mines and
Petroleum Departments.

Mr Dowd has previously held senior
executive positions as Managing
Director of Newmont Australia Ltd
and Vice President Australia and New
Zealand Operations for Newmont Mining
Corporation and prior to that as Chief
Operating Officer of Normandy Mining
Ltd. Mr Dowd was previously Chairman
of Adelaide Resources Ltd and a
non-executive Director of Macarthur Coal
Ltd and OZ Minerals Limited.

External appointments: Non-executive
Director PNX Metals Limited; Advisory
Board Member of South Australian
Minerals and Petroleum Expert Group
(SAMPEG) and University of Queensland
– Sustainable Minerals Institute.

Mr Mansell was appointed as an
independent Non-Executive Director and
Chairman of the Board in October 2015.

Mr Mansell also serves as Chair of the
Remuneration Committee and member
of the Audit and Risk Committee.

Mr Mansell has extensive experience in
the mining, corporate and energy sectors,
both as an advisor and as an independent
non-executive Chairman and Director of
listed and unlisted companies.

Mr Mansell practised law for a number
of years as a partner in corporate and
resources law firms in each of South
Africa and Australia. He retired from
legal practice in 2004 and has since held
directorships in a number of companies
including BWP Management Ltd, Foodland
Associated Ltd, OZ Minerals Ltd, W.A.
Newspaper Holdings Ltd (Chairman),
Electricity Networks Corporation (trading
as Western Power) (Chairman) and Zinifex
Ltd (Chairman).

Mr Mansell also chaired the Advisory
Board of Pacific Aluminium Ltd in
anticipation of its intended float in 2014.

External appointments: Non-executive
Chairman of Ora Banda Mining Ltd, DRA
Global Limited, the Cancer Research Trust
and Foodbank of Western Australia.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

DIReC toRs

sHAne CHARLes

JUstIn CARey

RosemARy FA gen

InDePenDent non-exeCUtIve
DIReC toR

LLB

non-exeCUtIve DIReC toR

BCom

MSc (prelim) Biochemistry MBA (GMD)
AGSM

Mr Charles joined the ERA Board as an
independent Non-Executive Director in
October 2015.

Mr Charles is the Chair of ERA’s Audit
and Risk Committee, and sits on the
Remuneration Committee, Sustainability
Committee (from January 2016) and the
Rehabilitation Committee.

Mr Charles is an experienced
Non-Executive Director and has based
most of his career from his home in
Toowoomba in regional Queensland.
He is passionate about the ability and
capability of regional Australia and has
been at the forefront of many advocacy
efforts to ensure regional Australia is
not forgotten.

Mr Charles current roles include amongst
others, Chairman of Toowoomba and
Surat Basin Enterprise Pty Ltd and its
subsidiary entities, and President of the
Royal Agricultural Society of Queensland.
He is also the Managing Director of
Sunland Legal, a digitally based legal
services provider. He has a strong interest
in corporate governance and to that end
also sits on a regional committee for the
Australia Institute of Company Directors.

Previous significant roles include periods
of service as Chairman of Stanwell
Corporation Limited, Deputy Chairman
and Commissioner of the GasFields
Commission of Queensland, Chairman
of Sunrise Way Rehabilitation Limited,
and as Chairman of the Endeavour
Foundation.

Mr Carey was appointed as a
Non-Executive Director in August 2019.

Mr Carey brings extensive financial,
technical and corporate experience, with
over 25 years’ experience in a variety
of commercial finance roles, with 20 of
those years’ experience within the mining
industry. In that time, Mr Carey spent two
and a half years as CFO for Oyu Tolgoi
LLC based in Mongolia.

Since leaving Mongolia, Mr Carey has
held various roles within the Rio Tinto
corporate finance team, including as
finance officer for the Group’s corporate
entities and leading the Group’s planning
and forecasting processes as the General
Manager Financial Planning & Analysis.

Mr Carey has served on several Rio
Tinto entity boards and brings extensive
experience in corporate governance and
control processes.

Ms Fagen was appointed as a Non-
Executive Director in February 2022.
Ms Fagen is currently the Head of
Operational Excellence, People; Office
of the Chief Operating Officer of Rio
Tinto. As part of the Chief Operating
Officer’s core team, Rosemary is driving
transformational change to the business
with the introduction of the Rio Tinto Safe
Production System. She is providing
the strategic approach to change
management, ensuring the business
is resourced, ready, empowered and
engaged to bring together proven tools,
rituals and leading practices into the one
framework.

Ms Fagen holds post-graduate degrees in
biochemistry and business administration.
Ms Fagen has a wide variety of
experience including overseeing Copper
& Diamonds’ human resources strategies,
processes and functions as Vice
President, People & Organisation. Prior
to this, Ms Fagen was Vice President,
Human Resources Rio Tinto’s Energy
group from 2010 to 2014. Before joining
Rio Tinto, Ms Fagen held positions in the
aviation sector including Executive Vice
President, Human Resources for Qatar
Airways and held senior human resources
leadership positions with Qantas Group
and AWA Limited.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

DIReC toRs

exeCUtIve C ommIttee

JAQUes vA n tonDeR

RICHARD PRest

FoRRest egeR ton

non-exeCUtIve DIReC toR

MBAProjMgt, MMaint&AssMgt, GAICD

CHIeF FInA nCIAL oFFIC eR AnD
JoInt C omPAny seCRetARy

BE Chemical, MBA, AAICD

geneRAL mA nAgeR CLosURe

Mr Prest was appointed as Chief Financial
Officer in March 2021 and appointed as
joint Company Secretary in December
2021. Mr Prest brings substantial financial
leadership, business development and
transformation skills to ERA. Mr Prest has
spent more than 30 years in the resources
sector and brings previous experience
as a CFO, General Manager of Finance
and Director for Rio Tinto including Gove
Operations in the Northern Territory.
Mr Prest has a degree in Chemical
Engineering and a Master of Business
Administration.

Mr Egerton was appointed General
Manager Closure in January 2021.

Over the last 11 years, Mr Egerton has
held various leadership roles with ERA,
including Manager Operations and
Manager Water Treatment & Tailings.

Prior to joining ERA, Mr Egerton was
involved in Desalination, Water Treatment
and Hospitality industries.

Mr van Tonder joined the ERA Board as
a Non-Executive Director in May 2020.

Mr van Tonder is a member of
the Sustainability Committee and
Rehabilitation Committee.

Mr van Tonder joined Rio Tinto more
than 20 years ago and has held senior
operational management roles at
Palabora, Robe Valley, Cape Lambert
Operations, Hope Downs 4 and Argyle.
Mr van Tonder has been a senior
leader in the Rio Tinto Group Technical
functional team since 2017 and has
been instrumental in leading the Asset
Management global transformation
programme as head of the Asset
Management Centre of Excellence.

Mr van Tonder was appointed by the
Oyu Tolgoi Board of Directors as the new
Chief Development Officer for Oyu Tolgoi
effective 1 December 2020.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

exeCUtIve C ommIttee

ALAn tIet ZeL

geneRAL mA nAgeR
exteRnAL ReLAtIons

BA, Bcom, DipEd, MBA

sHAnnon CoAtes

JoInt C omPAny seCRetARy

LLB, BJuris, GAICD, ACIS

Mr Tietzel was appointed as General
Manager External Relations in July 2010.

Ms Coates was appointed as joint
Company Secretary in December 2021.

Mr Tietzel has a background in Aboriginal
land agreements, regional development,
government relations, human resources
and organisation development. Mr Tietzel
joined Rio Tinto in 1990 and has worked
in the diamonds, salt, bauxite and alumina
sectors, and in a variety of corporate
functions.

Ms Coates is a qualified lawyer, Chartered
Secretary and graduate of the AICD’s
Company Directors course. She has more
than 25 years’ experience in corporate
law and compliance, is Managing Director
of Perth-based corporate advisory firm
Evolution Corporate Services and is
currently company secretary to a number
of ASX listed companies, with a strong
focus on resources.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

Directors
The persons who served as directors of ERA throughout 2021 and until the date of this Directors’ Report are: Peter Mansell, Paul
Dowd, Shane Charles, Justin Carey and Jacques van Tonder. In addition:

•

Brad Welsh, having been initially appointed as Acting Chief Executive on 4 October 2021, was subsequently appointed as Chief
Executive and Managing Director on 18 February 2022; and
Rosemary Fagan was appointed as a Non-Executive Director on 1 February 2022.

Details of the qualifications, experience and special responsibilities of the current Directors of ERA are set out on pages 28 to 30 of
this Report. Paul Arnold served as Chief Executive and Managing Director of ERA until his resignation on 4 October 2021. Marcia
Hanrahan served as a Non-Executive Director of ERA until her resignation on 28 April 2021.

Meetings of Directors
The number of Directors and committee meetings held and the number of meetings attended by each of the Directors of the Company
during the financial year are shown below:

DIRECTOR

P Mansell

B Welsh1

P Arnold2

S Charles

P Dowd

J Carey

M Hanrahan3

J van Tonder

DIRECTORS
MEETINGS4

AUDIT AND RISK
COMMITTEE4

REMUNERATION
COMMITTEE4

SUSTAINABILITY
COMMITTEE4,5

OTHER4,6

10/10

3/3

7/7

10/10

9/10

2/2

10/10

3/3

2/2

3/3

8/8

1/1

8/8

7/8

Note 1
Note 2
Note 3
Note 4
Note 5
Note 6

Appointed as a Director 18 February 2022. Mr Welsh attended meetings in his role as Acting Chief Executive effective 4 October 2021.
Resigned as a Director 4 October 2021.
Resigned as a Director 28 April 2021.
Number of meetings attended / maximum the Director would have attended.
The name of the committee was changed from the HSE Committee to the Sustainability Committee during the reporting period.
Other meetings include meetings of the committee formed for the purposes of the assessment of funding alternatives.

Mr Arnold was invited to meetings of the Audit and Risk Committee and the Sustainability Committee prior to his resignation as a
Director and attended all such meetings held during that time.
Mr Welsh was invited to meetings of the Board, Audit and Risk Committee and the Sustainability Committee following his appointment
as Acting Chief Executive and attended all such meetings held during that time.

Interests of Directors
The interests of each Director in the share capital of the Company and its related body corporates as at 4 March 2022 are shown below:

DIRECTORS

P Mansell

B Welsh1

P Arnold2

S Charles

P Dowd

J Carey

M Hanrahan3

J van Tonder

R Fagen4

ENERGY RESOURCES OF
AUSTRALIA LTD
ORDINARY SHARES

RIO TINTO LIMITED
ORDINARY SHARES

RIO TINTO LIMITED CONDITIONAL
INTERESTS IN ORDINARY SHARES

3,648

1,772

750

5,587

1,082

23,598

1,992

13,567

2,155

12,965

2,427

22,043

Note 1
Note 2
Note 3
Note 4

Appointed as a Director 28 February 2022.
Resigned as a Director 4 October 2021. Holding is at the time of resignation.
Resigned as a Director 28 April 2021. Holding is at the time of resignation.
Appointed as a Director 1 February 2022.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

Remuneration report
The Remuneration Report is set out under the following main
headings:

A.
B.

C.
D.
E.
F.
G.

Board oversight of remuneration
Principles used to determine non-executive Directors’
remuneration
Principles used to determine executive remuneration
Details of remuneration
Executive service agreements
Share based compensation
Additional information

The information provided in the Remuneration Report has been
audited by the Company’s independent auditor as required by
section 308(3C) of the Corporations Act 2001.

Board oversight of remuneration
A
The Remuneration Committee has responsibility to review:

•

Remuneration framework and policies (including key
performance indicators) for the Company’s Chief Executive
and senior executives;
Remuneration and performance of the Company’s Chief
Executive and senior executives;
Remuneration of the Company’s non-executive Directors;
and
Remuneration disclosures made by the Company.

The Remuneration Committee Charter is available at the
Corporate Governance section of ERA’s website.

Principles used to determine non-executive
Directors’ remuneration

Fees and payments to non-executive Directors reflect the
demands which are made on, and the responsibilities of, the
non-executive Directors. The Remuneration Committee reviews
and makes recommendations to the Board regarding non-
executive Directors’ remuneration. These fees are comprised
of a base fee and any fees payable to non-executive Directors
for their membership on established committees of the Board.
ERA does not pay retirement or post-employment benefits to
non-executive Directors, however, statutory superannuation
contributions are paid to non-executive Directors. In addition,
from time to time, the Board may approve that non-executive
Directors receive additional fees for services provided outside
the established committee processes.

The following principles are applied in determining the
remuneration of non-executive Directors:

•

•
•

•

The responsibilities of, and time spent by, the non-executive
Directors on the affairs of ERA, including preparation time;
Acknowledgement of the personal risk borne as a Director;
Comparison with professional market rates of remuneration
to remain competitive with the market having regard to
companies of similar size and complexity; and
The desire to attract Directors of a high calibre with
appropriate levels of expertise and experience.

At the 2008 Annual General Meeting, shareholders resolved
to amend the Constitution of the Company to provide that the
aggregate remuneration for non-executive Directors of ERA
would be not more than $800,000 per annum. At the 2020 Annual
General Meeting, the resolution to increase this limit to $950,000
was approved with 96.80 per cent of shares voting in favour
(voting comprised 3,488,564,371 votes ‘for’ the resolution and
115,041,466 votes ‘against’ the resolution). At the 2021 Annual
General Meeting, the 2020 Remuneration Report was also
approved with 99.94 per cent of shares voted in favour (voting
comprised 3,189,962,061 votes ‘for’ the resolution and 2,008,443
votes ‘against’ the resolution). North Limited and Peko-Wallsend
Pty Ltd, which are both Rio Tinto entities, voted a combined total
of 3,186,682,634 votes ‘for’ the resolution. The aggregate amount
of non-executive Directors’ remuneration paid in 2021 was
approximately $803,000 inclusive of statutory superannuation.

The non-executive Directors’ fees were last reviewed by the
Board in January 2021. The annual fees for non-executive
Directors for 2021 (excluding superannuation) were as follows:

Chairman

Non-executive Director

Audit and Risk Committee
Chair1

Audit and Risk Committee
Member1

Sustainability Committee
Chair1

Sustainability Committee
Member1

Remuneration Committee
Chair1

Other

2021

$186,080

$103,378

2020

$183,330

$101,850

$24,811

$24,444

$13,708

$13,505

$21,089

$20,777

$13,708

$13,505

$21,089

$20,777

Note 1 Fees are payable in addition to Chairman and non-executive Director fees.

The Board also confirmed that all non-executive Director and
Committee fees should increase by a percentage equal to the
average increase awarded to employees across the Company
until the next detailed review is conducted.

ENERGY RESOURCES OF AUSTRALIA LTD

DIReCtoRs' RePoRt

Principles used to determine executive
remuneration

The Remuneration Committee is responsible for the review of,
and where appropriate will make recommendations to the Board
in respect of, executive remuneration.

The Corporations Act 2001 and relevant Accounting Standards
require disclosures in respect of “key management personnel”,
being those persons having authority and responsibility for
planning, directing and controlling the activities of the Company.

The key management personnel are, in addition to the Directors,
the permanent General Managers of the Company reporting
directly to the Chief Executive. Throughout this Remuneration
Report the key management personnel who are not Directors are
collectively referred to as “senior executives”.

As the Company is a member company of the Rio Tinto Group, it
generally implements the remuneration policies and procedures
determined by the Rio Tinto Remuneration Committee and
applied to senior management personnel across the wider Rio
Tinto Group to determine the remuneration of the Chief Executive
and senior executives.

As a member of the Rio Tinto Group, ERA’s Chief Executive and
senior executives are seconded from Rio Tinto and are hence
drawn from the talented pool of executives in the wider Rio Tinto
Group. It is the view of the Remuneration Committee (which has
been endorsed by the Board) that a company of ERA’s size,
scope and remote location would have significant difficulty in
attracting executives of the calibre necessary to ensure superior
performance or in retaining them for significant periods if this
arrangement was not in place. Under these circumstances,
the Board believes that the general application of the Rio
Tinto remuneration framework to ERA’s Chief Executive and
senior executives, with appropriate review by the Company’s
Remuneration Committee, is of benefit to ERA.

For the purposes of assessing the appropriate level of
remuneration, the Australian resources sector is considered
the most relevant comparator group. Additional references are
also made to other relevant supplementary comparator groups.
Typically, base salaries are positioned at the median of these
comparator groups, while incentive plans are designed with the
potential to deliver total remuneration outcomes across the full
market range according to business and individual performance.
The related costs of these programs are recognised in the
Company’s financial statements.

Executive remuneration, including base salary and short and long
term incentive plan awards, and other terms of employment are
reviewed annually having regard to the evaluation of individual
and business performance against goals set at the start of the
year, global economic conditions and relevant comparative
information. As well as base salary, remuneration packages may
include fringe benefits such as medical insurance, car, rent and
other allowances, superannuation, retirement entitlements and
short and long term incentives.

The annual performance evaluation and management process for
2021 included formal consultation between the Chairman (based
on the Remuneration Committee’s review and recommendations)
and the Rio Tinto Chief Executive Australia, regarding the Chief
Executive of the Company, and between the Remuneration
Committee and the Chief Executive of the Company regarding
the senior executives.

An annual performance evaluation of the Chief Executive and
senior executives was undertaken in 2021.

The executive pay and reward framework is designed to provide
a total remuneration package which is competitive in the market,
aligns total remuneration with delivered individual and short
and long term business performance, strikes an appropriate
balance between fixed and variable components, links variable
components to the achievement of challenging individual and
business performance targets, and ensures the attraction,
motivation and retention of the high calibre senior executives
required to lead the Company.

The executive pay and reward framework has four components:

•
•
•

Base salary and benefits;
Short term incentive plans;
Long term incentive plans through participation in the
Rio Tinto 2018 Equity Incentive Plan (EIP), share-based
remuneration, including management share awards (MSA),
performance share awards (PSA) and bonus deferral
awards (BDA) where applicable.

• Other remuneration such as superannuation.

Performance and non-performance related
remuneration
Total remuneration is a combination of the fixed, performance
and service related elements described in this report. The short
and long term incentives are the variable components of the
total remuneration package and are therefore “at risk”. They are
tied to achievement of specific business measures, individual
performance and service. Other components are referred to as
“fixed” as they are not at risk.

The long term incentive plans are designed to provide a target
expected value of between 22.5 and 45 per cent of base salary
for the senior executives and the Chief Executive, delivered in
any one year through a blend of PSAs, MSAs and BDAs. In 2021
PSAs, MSAs and BDAs were awarded.

Excluding post-employment and non-monetary benefits, the
proportion of total direct remuneration, assuming maximum
award levels and maximum levels of performance, provided by
way of variable at risk components as at 31 December 2021 for
the Chief Executive and senior executives was between 50 and
70 per cent. The actual proportion of total direct remuneration
provided by way of variable performance related components will
differ from these percentages depending on measured Company,
Rio Tinto and individual performance and the current blend of
share plans.

ENERGY RESOURCES OF AUSTRALIA LTD
DIReCtoRs' RePoRt

Base salary
Base salary is set at a level consistent with market expectations
within the wider Rio Tinto remuneration framework and may be
delivered as a mix of cash and prescribed non-financial benefits.
It is targeted broadly at the median of companies of similar size,
global reach and complexity, including other large natural resource
companies. Base salary is reviewed annually and adjusted taking
into account the individual and Company performance, global
economic conditions, role responsibilities, an assessment against
comparator groups, internal relativities and base salary budgets
applying to the broader employee population.

Awards under the EIP can take the form of:

•

Conditional Awards - under which the participant receives
shares for free automatically to the extent the award vests
(which may be subject to the achievement of performance
conditions);
Forfeitable Shares - under which the participant receives
free shares on grant, which must be given back to the extent
the award lapses;

• Other forms of awards are permitted under the EIP and may
be used in the event the Rio Tinto Groups renumeration
approach changes.

Short term incentive plan
The short term incentive plan provides a bonus opportunity and is
designed to support the overall remuneration policy by focusing
management personnel on calendar year performance against
challenging individual and business targets.

Short term incentive performance conditions
Individual performance is reviewed against relevant targets and
objectives annually. The Chief Executive and senior executives
of the Company have between 40 and 60 per cent of their
performance-based bonus based on business measures,
with the remainder based on individual measures.

In 2021, bonus payments shown as remuneration relate to
performance in 2021.

The Company’s business performance measures for 2021 used
in the determination of short term incentive plan payments were:

•

•
•

Safety - All Injury Frequency Rate,
and measures relating to the Safety Maturity Model;
Financial - net earnings and free cash flow; and
Business - tailings transfer, Brine Concentrator performance
and rehabilitation earned value.

Incentive Plans
In 2018, Rio Tinto implemented a new discretionary employee
share plan, for executive directors and employees. The EIP
replaced Rio Tinto’s Performance Share Plan (PSP) 2013,
Management Share Plan (MSP) 2007 and Bonus Deferral Plan
(BDP). This allowed Rio Tinto to continue operating its long-
term incentive arrangements (including bonus deferred awards)
through a single set of plan rules. As previously outlined, the
Remuneration Committee believes that the general application of
the Rio Tinto remuneration framework (including the EIP to ERA’s
Chief Executive and senior executives, with appropriate review
by the Remuneration Committee) is of benefit to the Company.
During 2021, the Remuneration Committee reviewed the position
for future years.

Inclusion of other award types is to provide for sufficient flexibility
in the future should the Group’s remuneration approach change
during the life of the Plan. Awards may also be granted as cash
awards.

An award may be granted on the basis that it will normally only
vest to the extent that a performance condition, set by the Rio
Tinto Remuneration Committee at the time of grant, is satisfied
by Rio Tinto. However, awards representing deferred bonuses
will not be subject to performance conditions. The vesting of
awards granted to executive directors (other than bonus deferred
awards) will always be subject to a performance condition, except
as otherwise permitted by Rio Tinto’s Remuneration Policy.

Conditional awards and options will be granted on the basis that
the participant will receive dividend equivalents for the vesting
period (in additional shares or cash) when, and to the extent that,
the award vests or is exercised. The dividend equivalent will be
calculated based on the aggregate value of dividends paid during
the vesting period unless the Rio Tinto Remuneration Committee
decides to use a different approach.

Awards will normally vest, to the extent that any performance
condition is met, at the end of a period set when the award is
granted or the end of the period over which any performance
condition is tested. Shares will be issued or transferred to
the participant on vesting. Vesting may be delayed where a
participant is subject to any external investigation or similar
circumstances.

If Rio Tinto was subject to a change of control, awards will vest
subject to the extent to which any performance condition has been
satisfied. Alternatively, participants may be allowed or required to
exchange their awards for equivalent awards over shares in the
acquiring company. If awards vest, the awards will be pro-rated
unless the Rio Tinto Remuneration Committee decides otherwise.
However, no pro rating will apply to deferred bonus awards or on
performance share awards where the participant leaves more than
three years after the grant.

ENERGY RESOURCES OF AUSTRALIA LTD Share dealing policy
The participation of the Chief Executive and senior executives
in the Rio Tinto share plans involving the awarding of Rio Tinto
securities at a future date, and any grants of shares and
options under these plans, is subject to and conditional upon
compliance with the terms of the ‘Rio Tinto Securities Dealing
Policy’ (Dealing Rules). The Dealing Rules for dealing
expressly prohibit the limiting of exposure to economic risk in
relation to such securities, and are available on the Rio Tinto
website at www.riotinto.com.

DIReCtoRs' RePoRt

Awards
The current intention remains that awards will be made under the
EIP in the form of Conditional Awards in line with the Rio Tinto
Group’s Remuneration Policy.

Performance Share Awards

Performance Share Awards (PSA), provide a conditional right
to Rio Tinto shares to eligible senior management personnel
within the Rio Tinto Group, including the Chief Executive and
senior executives of ERA. Award levels under the EIP are at the
discretion of Rio Tinto and the ERA Remuneration Committee.

The conditional awards only vest if the performance condition set
by the Rio Tinto Remuneration Committee is satisfied by Rio Tinto,
although the Rio Tinto Remuneration Committee retains discretion
to satisfy itself that satisfaction of the performance condition is a
genuine reflection of the underlying performance of the business.
Prior to the vesting of conditional awards, Rio Tinto’s Total
Shareholder Return (TSR) performance against the performance
condition is calculated independently by Deloitte.

Subject to Rio Tinto Remuneration Committee approval, awards
vest based on the Rio Tinto Group’s TSR performance against the
MSCI World Index (one half) and the EMIX Global Mining Index
(one half), relative to global mining comparators. This is reviewed
at 31 December of the fifth year of the grant. The level of vesting
depends on performance against the indices. Awards granted prior
to 2018 also had an EBIT related performance condition (one-
third).

Management Share Awards

Management Share Awards (MSA) are conditional grants of Rio
Tinto shares to eligible employees of the company which will vest,
wholly or partly, upon expiry of a three year vesting period. Award
levels under the EIP are at the discretion of Rio Tinto.

Other Share Plans

All employees of the company may participate in Rio Tinto share
purchase plans applicable at particular locations. Under the
plan (known as and referred to later in this report as myShare),
employees may acquire shares up to the value of US$5,250 (or
local currency equivalent) per year, capped at 15 per cent of their
base salary. Each share purchased will be matched by Rio Tinto
and paid by ERA (currently at a ratio of one for one) providing the
participant holds the shares and remains employed at the end of
the three year vesting period. Further details are at Note 33 to the
Financial Statements.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

Details of remuneration

D
Details of the remuneration of each non-executive and executive Director and each of the senior executives in respect of their
services to the Company are set out in the following section.

Non-executive Directors of Energy Resources of Australia Ltd

SHORT TERM BENEFITS

POST EMPLOYMENT BENEFITS

DIRECTORS
FEES
($000)

CASH
BONUS
($000)

NON- CASH
BENEFITS
($000)

SUPER-
ANNUATION
($000)

TOTAL
($000)

P Mansell

S Charles

P Dowd

J Carey

M Hanrahan1

J van Tonder

A Sutton 2

Total 2021

Total 2020

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

221

218

142

140

138

136

103

102

117

754

771

Note 1
Note 2

Appointed as a Director 29 May 2020 and resigned as a Director 28 April 2021.
Resigned as a Director 29 May 2020.

243

239

156

153

151

149

103

102

117

803

823

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

Executive Director and senior executives
Set out below is an overview of the remuneration paid to the Executive Director and senior executives in 2021. This includes details of
the key elements of remuneration and a summary of total remuneration for 2021.

Paul Arnold
(Chief Executive and Managing Director from 2 August 2017 and resigned 4 October 2021)
Base salary
Mr Arnold was appointed as Chief Executive and Managing Director on 2 August 2017 and resigned 4 October 2021. Mr Arnold’s
base salary was reviewed annually with reference to the underlying performance of ERA and the Rio Tinto Group, global economic
conditions, role responsibility, individual performance, an assessment against relevant comparator groups, internal relativities and
base salary budgets applying to the broader employee population.

On 1 March 2021, Mr Arnold’s base salary was $400,412 (1 March 2020 $394,495).

STIP objectives
No STIP was paid to Mr Arnold by ERA in 2021 due to his resignation on 4 October 2021.

The following individual objectives were set for Mr Arnold for 2021:

•

Safe and predictable completion of operations and transition to rehabilitation. With a particular emphasis on process safety, asset
integrity, productivity, output, quality, costs and cash flow;
Effective implementation of Ranger rehabilitation, including strategies for water management, other environmental controls and
progressive rehabilitation and dredging operations, including stable and consistent operation of Brine Concentrator; and
Effective leadership behaviours in interaction with employees, the Board and stakeholders including Traditional Owners,
regulators, investors and the community.

STIP outcomes
Mr Arnold resigned from ERA on 4 October 2021 and as such had no STIP measured.

LTIP awards granted
Award levels are set so as to incentivise executives to provide sufficient retention for the executive team and to contribute to the
competitiveness of the overall remuneration package. The value of the MSAs and PSAs granted to Mr Arnold in 2021, based on the
expected value calculations performed by independent advisors, was 46 per cent of base salary. The eventual amount that vests will
depend on performance within the Rio Tinto Group during the period 2022 to 2025.

Total remuneration
The table below provides a summary of Mr Arnold’s total remuneration disclosed for the years of 2020 and 2021. The purpose of
this table is to enable shareholders to better understand the actual remuneration received and to provide an overview of the actual
outcomes of the Company’s remuneration arrangements. The remuneration details set out below include accounting values relating
to various parts of the remuneration packages, most notably deferred shares. Accordingly, the numbers below are not compatible with
those in the table on page 43.

(STATED IN $’000)

Base salary paid1

STIP cash bonus2

STIP deferred shares3

LTIP share based payments

Superannuation

Other benefits4

Total remuneration

% change from previous year

% of maximum STIP cash bonus awarded

% of maximum STIP cash bonus forfeited

2021

316

170

609

-41%

2020

393

202

210

140

1,041

68%

32%

Note 1
Note 2
Note 3
Note 4

Salaries are reviewed with effect from 1 March. Mr Arnold resigned on 4 October 2021.
Bonus payable / paid refers to current year performance.
Value of deferred share awards granted under the EIP.
Other benefits include accommodation, vehicle and other allowances and Company paid superannuation above statutory requirements that is taken as cash.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

Brad Welsh
(Acting Chief Executive from 4 October 2021, Chief Executive and Managing Director from 18 February 2022)
Base salary
Mr Welsh was appointed as Acting Chief Executive on 4 October 2021 and appointed Chief Executive and Managing Director on
18 February 2022. Mr Welsh is seconded from the Rio Tinto Group. His base salary was determined with reference to the Rio Tinto
Group, global economic conditions, role responsibility, individual performance, an assessment against relevant comparator groups,
internal relativities and base salary budgets applying to the broader employee population.

On 4 October 2021, Mr Welsh’s base salary was $324,800, in addition a higher duties allowance of $64,960 per year was payable.
Upon appointment on 18 February 2022, Mr Welsh’s base salary was $390,000.

STIP objectives
No STIP objectives were set relevant to ERA in 2021.

STIP outcomes
Mr Welsh’s 2021 STIP appraisal relates partly to performance whilst acting in the role of ERA Chief Executive and partly to
performance whilst employed elsewhere within the Rio Tinto Group. Mr Welsh’s total STIP was assessed at 122.7% out of 200%.
The individual performance component representing 40% and business performance representing 60%, with an appraised score of
120.0% and 124.5% respectively. Mr Welsh’s STIP payment has been apportioned to only include the time employed by ERA.

LTIP awards granted
Award levels are set so as to incentivise executives to provide sufficient retention for the executive team and to contribute to the
competitiveness of the overall remuneration package. No LTIP’s were granted to Mr Welsh for service to ERA during 2021. LTIP
payments represent theoretical values attributable to progressive vesting of existing LTIP’s for the period Mr Welsh was employed by
ERA in 2021.

Total remuneration
The table below provides a summary of Mr Welsh’s total remuneration disclosed for ERA for 2021. The purpose of this table is to
enable shareholders to better understand the actual remuneration received and to provide an overview of the actual outcomes of the
Company’s remuneration arrangements.

(STATED IN $’000)

Base salary paid1

STIP cash bonus

STIP deferred shares

LTIP share based payments

Superannuation

Other benefits2

Total remuneration

% change from previous year

% of maximum STIP cash bonus awarded

% of maximum STIP cash bonus forfeited

2021

170

61%

39%

Note 1
Note 2 Other benefits include accommodation, vehicle and other allowances and Company paid superannuation above statutory requirements that is taken as cash.

Salaries are reviewed with effect from 1 March, with the next review due March 2023.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

Senior executives
Base salary
Base salaries are reviewed annually, with reference to the underlying performance of ERA, the Rio Tinto Group and the individual,
global economic conditions, role responsibility, an assessment against relevant comparator groups and base salary budgets applying
to the broader employee population.

At the end of 2020 and 2021, the base salaries of the Company’s senior executives were:

BASE SALARY ’$000

Richard Prest1

Forrest Egerton2

Alan Tietzel

Lesley Bryce3

David Blanch4

Note 1
Note 2
Note 3
Note 4

Appointed as Chief Financial Officer in March 2021.
Appointed as General Manager Closure in January 2021.
Resigned as General Manager Operations in January 2021.
Resigned as Chief Financial Officer in March 2021.

2021

2020

CHANGE

355

294

383

336

264

377

336

264

STIP objectives and outcomes
The individual objectives set out below relate to the 2021 financial year (with the corresponding STIP Award paid in 2022).

SUMMARY OF INDIVIDUAL OBJECTIVES

•
•

•
•
•

•
•

•

•
•

•

Prevention of high consequence safety and environmental events
Demonstrate Health, Safety and Environment leadership and contribute to sustained
improvement in health and safety performance
Lead the program management for cash generation and cost improvement across ERA
Deliver efficient and effective commercial support services to ERA, including IT and
procurement
Deliver excellence in accounting, performance reporting and financial forecasting
Lead ERA’s sales planning, maximising the value of ERA’s marketing arrangements
Demonstrate behaviours that align with the values of accountability, teamwork, integrity and
respect

Prevention of high consequence safety and environmental events
Demonstrate Health, Safety and Environment leadership and contribute to sustained
improvement in health and safety performance
Delivery of planned rehabilitation activities in accordance with the Ranger Mine Closure Plan,
including dredging and tailings deposition in Pit 3
Demonstrate behaviours that align with the values of accountability, teamwork, integrity and
respect

Prevention of high consequence safety and environmental events
Demonstrate Health, Safety and Environment leadership and contribute to sustained
improvement in health and safety performance
Continue effective implementation of stakeholder engagement strategy
Design, plan and deliver stakeholder initiatives which progress the Company’s direction on
Ranger closure planning and the future of Jabiru
Demonstrate behaviours that align with the values of accountability, teamwork, integrity and
respect

Richard Prest

Forrest Egerton

Alan Tietzel

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

A summary of the individual targets and performance for each of the Company’s senior executives (other than the Chief Executive)
for the 2021 financial year (with the corresponding STIP Award paid in 2022) is set out in the table below.

MEASURES

Richard Prest

Business and financial performance

Health and Safety

Individual

Total

Forrest Egerton

Business and financial performance

Health and Safety

Individual

Total

Alan Tietzel

Business and financial performance

Health and Safety

Individual

Total

Lesley Bryce1

Business and financial performance

Health and Safety

Individual

Total

David Blanch2

Business and financial performance

Health and Safety

Individual

Total

Note 1
Note 2

Resigned as General Manager Operations in January 2021
Resigned as Chief Financial Officer in March 2021.

WEIGHT (%)

RESULT
(OUT OF
200%)

WEIGHTED
RESULT (%)

25.0

15.0

60.0

100.0

25.0

15.0

60.0

100.0

25.0

15.0

60.0

100.0

25.0

15.0

60.0

100.0

25.0

15.0

60.0

100.0

50.4

133.0

100.0

50.4

133.0

80.0

50.4

133.0

60.0

12.6

20.0

60.0

92.6

12.6

20.0

48.0

80.6

12.6

20.0

36.0

68.6

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

A summary of the individual targets and performance for each of the Company’s senior executives (other than the Chief Executive)
for the 2020 financial year (with corresponding STIP Award paid in 2021) is set out in the table below.

MEASURES

Lesley Bryce

Business and financial performance

Health and Safety

Individual

Total

Alan Tietzel

Business and financial performance

Health and Safety

Individual

Total

David Blanch

Business and financial performance

Health and Safety

Individual

Total

WEIGHT (%)

RESULT
(OUT OF
200%)

WEIGHTED
RESULT (%)

25.0

15.0

60.0

100.0

25.0

15.0

60.0

100.0

25.0

15.0

60.0

100.0

130.0

110.0

140.0

130.0

110.0

100.0

130.0

110.0

120.0

32.5

16.5

84.0

133.0

32.5

16.5

60.0

109.0

32.5

16.5

72.0

121.0

LTIP awards
Award levels are set so as to incentivise executives to provide sufficient retention for the executive team and to contribute to
the competitiveness of the overall remuneration package. The value of the awards granted to the Company’s senior executives
(other than the Chief Executive) in 2021, based on the fair value calculations performed by independent advisors, was between
22.5 per cent and 30.0 per cent of base salary.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

Executive Director and senior executives total remuneration

SHORT TERM BENEFITS

CASH
SALARY
($000)

CASH
BONUS8
($000)

OTHER9
($000)

RETENTION
PAYMENTS10
($000)

POST
EMPLOYMENT
BENEFITS

SHARE
BASED
PAYMENTS

SUPER-
ANNUATION
PENSION
($000)

CASH &
EQUITY
SETTLED
($000)

Executive Director

B Welsh1

P Arnold2

Senior executives

R Prest3

F Egerton4

A Tietzel5

D Blanch6

L Bryce7

Total 2021

Total 2020

2021

2020

2021

2020

2021

2020

2021

2020

316

393

266

294

382

376

262

332

1,434

1,363

202

142

139

262

574

140

137

120

119

134

167

462

560

181

152

116

170

210

125

135

106

491

509

TOTAL
($000)

170

609

974

539

668

736

801

109

656

872

2,877

3,303

Note 1

Note 2
Note 3
Note 4

Note 5
Note 6
Note 7
Note 8
Note 9

Note 10

Performance related cash bonus: 61 per cent awarded in 2021, 39 per cent forfeited. 2021 cash bonus apportioned for time employed by ERA. No performance
related cash bonus was granted for services to ERA in 2020.
No performance related cash bonus was granted for services to ERA in 2021. 68 per cent awarded in 2020, 32 per cent forfeited.
Performance related cash bonus: 46 per cent awarded in 2021, 54 per cent forfeited. No performance related cash bonus was granted for services to ERA in 2020.
Performance related cash bonus: 40 per cent awarded in 2021, 60 per cent forfeited. No performance related cash bonus was granted for services to ERA in 2020
as a Key Management Personnel.
Performance related cash bonus: 34 per cent awarded in 2021, 66 per cent forfeited. 63 per cent awarded in 2020, 37 per cent forfeited.
No performance related cash bonus was granted for services to ERA in 2021. 69 per cent awarded in 2020, 31 per cent forfeited.
No performance related cash bonus was granted for services to ERA in 2021. 69 per cent awarded in 2020, 31 per cent forfeited.
Performance and related bonuses disclosed in 2021 relate to services in 2021 (equally bonuses disclosed in 2020 relate to services in 2020).
Other benefits include relocation, accommodation, travel, vehicle, other allowances, Company paid superannuation above statutory requirement
that is taken as cash excluding cash paid site allowances which are treated as cash salary.
Retention Payments were a conditional discretionary cash bonus aimed at retaining employees considered critical to ERA delivering on its commitments in relation
to stockpile processing and rehabilitation of the Ranger Project Area until 31 December 2020.

The value of share based awards has been determined in accordance with the recognition and measurement requirements of
AASB 2 ‘Share-based Payment’. The fair value of awards granted under the Rio Tinto 2018 Equity Incentive Plan, the Rio Tinto
Management Share Plan (MSP), Bonus Deferral Plan (BDP), Performance Share Plan (PSP) and myShare has been calculated
at their dates of grant using valuation models provided by external consultants Lane Clark and Peacock LLP, including an
independent lattice-based option valuation model and a Monte Carlo valuation model which takes into account the constraints
on vesting attached to these awards.

Executive service agreements

E
For reasons explained on page 34, as a member of the Rio Tinto Group, ERA’s Chief Executive and senior executives are seconded
from Rio Tinto under agreements between ERA and Rio Tinto.

The secondment agreements provide for the Chief Executive and senior executives to work under the direction of and be responsible
to the ERA Board. They include acknowledgements from Rio Tinto to the effect that the relevant executive’s duties as an officer of
ERA will require him or her to, among other things, act in good faith in the best interests of ERA as a whole and that, in doing so, the
executive will be taken to be performing his or her duties to the relevant Rio Tinto employing company.

As part of the process of appointment of a senior executive (including the Chief Executive) under this secondment arrangement, the
relevant executive is provided with a written statement relating to their responsibilities and duties as an officer of the Company, which
they are required to sign for their appointment.

ENERGY RESOURCES OF AUSTRALIA LTD

DIReCtoRs' RePoRt

Under the secondment agreements, during the secondment period ERA must pay amounts in respect of the relevant executive’s
base salary and other entitlements in accordance with their employment agreements with Rio Tinto. The employment agreements
provide for participation of the relevant executives in the Rio Tinto short and long term incentive plans upon achieving performance
and service goals. The employment agreements may also provide for other benefits, including: medical insurance, vehicle and
accommodation allowances, relocation allowances and expenses and travel allowances.

In setting the executives’ remuneration and any rewards based on performance, the Rio Tinto employing company is required to
have regard to the recommendations of the ERA Board, and to consult with the ERA Chairman regarding any material changes to
remuneration and benefits. Changes to the terms of an employment agreement must be consistent with those made generally for
all employees of the Rio Tinto employer, and ERA’s Chairman must be promptly informed of any material changes.

Each of the secondment agreements with Rio Tinto provides that ERA can end the secondment by giving Rio Tinto three months’
notice at any time. Likewise, Rio Tinto can end the executive’s secondment by giving three months’ notice to ERA.

Key provisions of the employment agreements of the Chief Executive and senior executives relating to remuneration are as set
out below.

B Welsh – Chief Executive and Managing Director
Term of agreement – Open, commenced as Acting Chief Executive, 4 October 2021
Commenced as Chief Executive and Managing Director, 18 February 2022
Base salary (excluding superannuation, allowances and other benefits) as at 31 December of $324,800 per annum. In addition, a
higher duties allowance at $64,960 per annum was payable. Upon appointment on 18 February 2022, Mr Welsh’s base salary was
$390,000. Maximum short term incentive bonus upon meeting performance criteria is 60 per cent of base salary. Base salary and
short term incentive targets are to be reviewed annually. Termination by the employee is three months’ notice in writing or by the
employer giving six months’ notice or equivalent payment in lieu of notice.

P Arnold – Chief Executive and Managing Director
Term of agreement – Commenced 2 August 2017 and resigned 4 October 2021
Base salary (excluding superannuation, allowances and other benefits) as at 4 October 2021 of $400,412 per annum. Maximum short
term incentive bonus upon meeting performance criteria is 100 per cent of base salary. Base salary and short term incentive targets
are to be reviewed annually. Termination by the employee is three months’ notice in writing or by the employer giving six months’
notice or equivalent payment in lieu of notice.

R Prest – Chief Financial Officer
Term of agreement – Open, commenced 8 March 2021
Base salary (excluding superannuation, allowances and other benefits) as at 31 December 2021 of $355,048 per annum. Maximum
short term incentive bonus upon meeting performance criteria is 60 per cent of base salary. Base salary and short term incentive
targets to be reviewed annually. Termination by the employee is three months’ notice in writing or by the employer giving six months’
notice or equivalent payment in lieu of notice.

F Egerton – General Manager Closure
Term of agreement – Open, commenced 15 January 2021
Base salary (excluding superannuation, allowances and other benefits) as at 31 December 2021 of $294,350 per annum. Maximum
short term incentive bonus upon meeting performance criteria is 50 per cent of base salary. Base salary and short term incentive
targets to be reviewed annually. Termination by the employee is three months’ notice in writing or by the employer giving six months’
notice or equivalent payment in lieu of notice.

A Tietzel – General Manager External Relations
Term of agreement – Open, commenced 1 October 2010
Base salary (excluding superannuation, allowances and other benefits) as at 31 December 2021 of $383,031 per annum. Maximum
term incentive bonus upon meeting performance criteria is 60 per cent of base salary. Base salary and short term incentive targets to
be reviewed annually. Termination by the employee is three months’ notice in writing or by the employer giving six months’ notice or
equivalent payment in lieu of notice.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

L Bryce – General Manager Operations
Term of agreement – Commenced 1 June 2017 and resigned 15 January 2021
Base salary (excluding superannuation, allowances and other benefits) as at 15 January 2021 of $335,821 per annum. Maximum
short term incentive bonus upon meeting performance criteria is 60 per cent of base salary. Base salary and short term incentive
targets to be reviewed annually. Termination by the employee is three months’ notice in writing or by the employer giving six months’
notice or equivalent payment in lieu of notice.

D Blanch – Chief Financial Officer
Term of agreement – Commenced 2 July 2018 and resigned 8 March 2021
Base salary (excluding superannuation, allowances and other benefits) as at 8 March 2021 of $264,578 per annum. Maximum short
term incentive bonus upon meeting performance criteria is 50 per cent of base salary. Base salary and short term incentive targets to
be reviewed annually. Termination by the employee is three months’ notice in writing or by the employer giving six months’ notice or
equivalent payment in lieu of notice.

The Chief Executive and senior executives are also entitled under their employment agreements with Rio Tinto to a range of
pre-existing redundancy entitlements, depending on the business and region from where they were originally employed within the Rio
Tinto Group. These include:
•
•
•
•

Notice may be worked or fully or partly paid in lieu, at ERA’s discretion;
Additional capped service related payments may apply;
Pro rata short term incentive plan payments may be paid based on the proportion of the performance period worked;
Conditional share awards granted and held for less than three years at the date of termination are reduced pro-rata.

There is no contractual entitlement to payments in the event of a change of control.

Share based compensation

Rio Tinto Performance Share Awards
Rio Tinto Performance Share Awards (PSA) are granted at the discretion of the Rio Tinto Remuneration Committee in line with
Rio Tinto guidelines. 100 per cent potentially vest after five years. PSAs have been granted under either the previous Rio Tinto
Performance Share Plan or, for awards granted from 2018, granted under the EIP. The terms and conditions of each right to Rio Tinto
Limited or Rio Tinto plc shares affecting remuneration in this or future reporting periods are as follows:

AWARD DATE

Rio Tinto Limited

15 May 2018

18 March 2019

16 March 2020

18 March 2021

MARKET PRICE
AT AWARD

PERFORMANCE PERIOD
ENDS1

MARKET PRICE AT
31 DECEMBER 2021

$83.61

$93.17

$77.65

$110.80

31 December 2022

31 December 2023

31 December 2024

31 December 2025

$100.11

Note 1

Vesting dependent upon continued employment with a Rio Tinto Group company and achievement of relevant performance conditions.

ENERGY RESOURCES OF AUSTRALIA LTD
DIReCtoRs' RePoRt

Rio Tinto Management Share Awards
Rio Tinto Management Share Awards (MSA) are granted at the discretion of the Rio Tinto Remuneration Committee in line with
Rio Tinto guidelines. MSAs have been granted under the EIP. The terms and conditions of each right to Rio Tinto Limited or Rio Tinto
plc shares affecting remuneration in this or future reporting periods are as follows:

AWARD DATE

Rio Tinto Limited

18 March 2019

16 March 2020

18 March 2021

MARKET PRICE
AT AWARD

PERFORMANCE PERIOD
ENDS1

PRICE AT
31 DECEMBER 2021

$93.17

$77.65

$110.80

24 February 2022

20 February 2023

19 February 2024

$100.11

Note 1

Vesting dependent upon continued employment with a Rio Tinto Group company.

Rio Tinto Bonus Deferral Awards
Rio Tinto Bonus Deferral Awards (BDA) are granted at the discretion of the Rio Tinto Remuneration Committee in line with Rio Tinto
guidelines. BDAs have been granted under the EIP. The terms and conditions of each right to Rio Tinto Limited shares affecting
remuneration in this or future reporting periods are as follows:

AWARD DATE

Rio Tinto Limited

16 March 2020

18 March 2021

MARKET PRICE
AT AWARD

VESTING DATE1

PRICE AT
31 DECEMBER 2021

$77.65

$110.80

1 December 2022

1 December 2023

$100.11

Note 1

Vesting dependent upon continued employment with a Rio Tinto Group company.

Rio Tinto employee myShare
The key management personnel and Directors of the Company who elected to participate in the Rio Tinto myShare share purchase
plan as at 31 December 2021 are set out below:

Rio Tinto myShare

B Welsh

J Carey

R Prest

F Egerton

A Tietzel

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

Conditional awards provided as remuneration
Rio Tinto Equity Incentive Plan
No conditional awards of ordinary shares of either ERA or of Rio Tinto Limited or Rio Tinto plc were provided during the year as
remuneration for services provided to ERA to any of the non-executive Directors. Details of conditional awards of ordinary shares in
Rio Tinto Limited and Rio Tinto plc held during the year and provided as remuneration to the Chief Executive and senior executives
of ERA in respect of their duties as officers of ERA are set out below. On vesting, each award converts into one ordinary share of
Rio Tinto Limited or Rio Tinto plc.

BALANCE
AT START OF THE
YEAR OR ON JOINING1

GRANTED AS
REMUN-
ERATION VESTED LAPSED

AWARDS
CANCELLED

OTHER
CHANGES2

BALANCE
AT END
OF YEAR3

Rio Tinto Limited

Executive Director

B Welsh

P Arnold

Senior executives

R Prest

F Egerton

A Tietzel

L Bryce

D Blanch

Non-executive Directors4

J Carey

M Hanrahan

J van Tonder

A Sutton

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

2,414

11,348

10,591

2,431

1,509

4,305

5,323

3,481

3,124

1,996

1,933

3,642

4,471

11,829

10,248

3,909

7,621

3,762

(1,543)

3,989

(3,232)

1,097

749

(567)

1,409

(1,909)

1,525

(2,543)

1,173

(816)

714

(651)

(1,604)

(2,127)

(2,372)

(1,417)

1,314

1,298

2,414

13,567

11,348

3,528

1,691

3,805

4,305

3,481

1,996

3,352

3,642

3,508

12,965

1,581

1,146

11,829

3,638

3,909

7,621

Note 1
Note 2

Note 3
Note 4

Where key management personnel joined during the year, balance at start of the year reflects holdings at time of commencement with ERA.
Other changes and end of year balance include changes made in relation to awards for service within the wider Rio Tinto group, including before joining or after
ceasing with ERA.
When key management personnel left prior to the end of the year, the balance reflects holdings at the date of resignation.
Changes to balances for non-executive Directors do not relate to remuneration for services provided to ERA.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

Shareholdings
No Directors hold shares in ERA. The number of shares held in Rio Tinto Limited during the financial year by each Director of ERA
are set out below.

Rio Tinto Limited

P Mansell

P Arnold

P Dowd

J Carey

M Hanrahan

J van Tonder

A Sutton

BALANCE
AT START OF
THE YEAR1

INCREASED
DURING
THE YEAR

OTHER CHANGES
DURING THE
THE YEAR

BALANCE
AT END OF
THE YEAR2

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

2,000

2,241

4,682

750

1,500

6,502

4,142

2,328

1,564

18,895

1,811

4,809

2,153

2,360

2,417

1,735

(2,000)

(2,280)

(7,250)

(750)

(4,504)

(1,335)

(2,328)

(1,735)

(1,564)

2,000

1,772

2,241

750

4,151

6,502

1,082

18,895

Note 1
Note 2

Where a Director was appointed during the year, balance reflects holdings at the time of commencement with the Company.
Where a Director resigned during the year, balance reflects holdings at time of resignation as a Director of the Company.

Additional information

Loans and other transactions with Directors and other key management personnel
There are no loans with Directors and other key management personnel. Other transactions with Director related entities are
disclosed in Note 27 – Related parties.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

Principal activities
The principal activities of the Company during the course of
the year consisted of the processing and sale of uranium oxide
and site rehabilitation.

Dividends
No dividends have been paid by ERA to members in respect
of the 2021 financial year (2020: nil).

Operating and financial review
Details of ERA’s review and results of operations are included in
the Chairman’s Report on page 4, the Chief Executive’s Report
on page 6 and the Financial Performance and Operations and
Rehabilitation sections on pages 9 and 11 respectively.

Significant changes to the state of affairs
In the opinion of the Directors, other than matters reported in
the Directors’ Report, the Chairman’s Report and the Chief
Executive’s Report, there were no significant changes in
the state of affairs of the Company during the year ended
31 December 2021.

Matters subsequent to the end of the financial
year
In the interval between the end of the year and the date of this
report there has not arisen any item, transaction or event of a
material nature, other than matters reported in the Chairman’s
Report and the Chief Executive’s Report on pages 4 and 6
respectively, that has significantly affected or may significantly
affect:

•
•
•

The operations of the Company;
The results of those operations; or
The state of affairs of the Company subsequent to the
Financial year ended 31 December 2021.

Likely developments
In the opinion of the Directors, any likely developments in the
operations of the Company known at the date of this report have
been covered within the Annual Report and Notes to the financial
statements.

A general review of developments for ERA is presented in the
Financial Performance and Operations and Rehabilitation section
on pages 9 and 11.

Annual General Meeting
The 2022 Annual General Meeting will be held in Darwin,
in the Northern Territory of Australia. Notices of the 2022
Annual General Meeting will be given to the shareholders of
the Company in accordance with the Corporations Act. It is
anticipated the meeting will be an in person meeting with the
Company closely monitoring the COVID-19 situation in the event
that a virtual or hybrid option becomes required.

Indemnification
Clause 11 of the Company’s Constitution provides that every
Director, manager, officer or employee of the Company shall be
indemnified out of the funds of the Company against all liability
incurred by them in defending any proceedings in which they are
successful.

The Corporations Act 2001 prohibits a company from
indemnifying Directors, secretaries, executive officers and
auditors from liability except for liability to a party, other than the
Company or a related body corporate, where the liability does not
arise out of conduct involving a lack of good faith and except for
liability for costs and expenses incurred in defending proceedings
in which the officer or auditor is successful. An indemnity for
officers or employees who are not Directors, secretaries or
executive officers, is not expressly prohibited by the Corporations
Act 2001.

The Directors and Company Secretaries of the Company, and all
former Directors and Company Secretaries, have the benefit of
the indemnity in Clause 11 of the Company’s Constitution.

The indemnity also applies to executive officers of the Company
(being the senior executives and managers who are concerned
with, or take part in the management of the Company) as well as
other employees.

Insurance
Since the end of the previous financial year, the Company has
paid insurance premiums in respect of a Directors’ and officers’
liability policy of insurance.

The policy indemnifies all Directors and officers of ERA (including
the Directors, Company Secretaries, and executive officers
referred to above) against certain liabilities.

In accordance with common commercial practice, the insurance
policy prohibits disclosure of the nature of the liability insured
against and the amount of the premium.

Environmental regulation and policy
ERA strives to be at the forefront of environmental management
in the uranium industry. It operates in accordance with relevant
Commonwealth and Northern Territory environmental legislation
as well as site specific environmental licences, permits and
statutory authorisations. ERA’s environmental management
system is ISO14001 compliant.

ERA is required to report any incident that is a divergence from
strict compliance with statutory requirements, even if the incident
has no detrimental environmental impact, and reports are made
to the Department of Primary Industry and Resources (Northern
Territory); the Supervising Scientist Branch of the Commonwealth
Department of Environment; the Northern Land Council; the
Commonwealth Department of Industry, Innovation and Science
and the Gundjeihmi Aboriginal Corporation (representatives of
the Mirarr Traditional Owners).

ERA’s commitment to protect the environment in 2021 was
overseen by the Supervising Scientist Branch, which conducts
extensive monitoring and research programs on the Ranger
Project Area and Jabiluka Mineral Lease.

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' RePoRt

There were no prosecutions commenced or fines incurred in
respect of ERA’s environmental performance during 2021. The
environment remained protected throughout the period.

Corporate governance

The Board of ERA considers high standards of corporate
governance to be critical to business integrity and performance.
The corporate governance structures and practices in place
at ERA are substantially in compliance with the 4th Edition of
the Corporate Governance Principles and Recommendations
developed by the ASX Corporate Governance Council (Council).

Areas where the corporate governance practices of ERA do not
follow the Council’s recommendations arise due to Rio Tinto’s
86.3 per cent ownership of the Company and the management,
direction, services and support this provides. The extent to
which the Company does not comply is detailed in the Corporate
Governance Statement on pages 52 to 58.

Company secretaries

Richard Prest and Shannon Coates are company secretaries of
ERA, each having been appointed to the role on 10 December
2022. Their qualifications and experience are set out on pages
30 and 31 respectively. Shanelle English served as company
secretary during 2021, until 10 December 2021.

Rounding of amounts
The Company is of a kind referred to in ASIC Class Order
2016/191 and in accordance with that Class Order amounts
in the financial statements and Directors’ Report have been
rounded to the nearest thousand dollars, unless otherwise
indicated.

Auditor
KPMG is the auditor of the Company. No person who was an
officer of the Company during the year was a former partner or
director of the auditor. Each of the Directors at the time this report
was approved has confirmed that so far as he or she is aware,

•

There is no relevant audit information (ie information needed
by the auditor in connection with preparing its report) of
which the auditor is unaware and;
He or she has taken all steps that they ought to have taken
as a Director in order to make himself or herself aware
of any relevant audit information and to establish that the
auditor is aware of that information.

Non audit services
The Company may decide to employ the auditor on assignments
additional to its statutory audit duties where the auditor’s
expertise and experience with the Company are important.

Details of the amounts paid or payable to the auditor for audit
services are set out below.

No non audit services were performed by KPMG during the year.

When performed all non-audit services are reviewed by the

Audit and Risk Committee to ensure they do not impact on the
impartiality and objectivity of the auditor and do not undermine the
general principles relating to auditor’s independence as set out
in Professional Statement F1, including reviewing or auditing the
auditor’s own work, acting in a management or decision making
capacity for the Company, acting as advocate for the Company or
jointly sharing economic risks and rewards.

During the year, the following fees were paid or payable for
services provided by the auditor of the Company, its related
practices and non-audit related firms.

PricewaterhouseCoopers Australia

Audit and review of financial reports

Audit and review of financial reports
(additional prior year fees)

KPMG Australia

Audit and review of financial reports

Audit and review of financial reports
(additional prior year fees)

Total remuneration for audit
services

Other non-audit related services

Total remuneration

2021
$000

2020
$000

291

328

215

246

Information on Auditor
KPMG continues in office in accordance with Section 327 of the
Corporations Act 2001.

A copy of the auditor’s independence declaration as required
under section 307C of the Corporations Act 2001 is set out on
page 51.

Signed at Perth this 15 March 2022 in accordance with a
resolution of the Directors.

P Mansell
Director
Perth
15 March 2022

ENERGY RESOURCES OF AUSTRALIA LTD AUDItoR's InDePenDenCe DeCLARAtIon

Lead Auditor’s Independence Declaration under
Section 307C of the Corporations Act 2001

To the Directors of Energy Resources of Australia Ltd

I declare that, to the best of my knowledge and belief, in relation to the audit of Energy Resources of
Australia Ltd for the financial year ended 31 December 2021 there have been:

ii.

no contraventions of the auditor independence requirements as set out in the
Corporations Act 2001 in relation to the audit; and

no contraventions of any applicable code of professional conduct in relation to the audit.

KPMG

Derek Meates
Partner

Perth

15 March 2022

KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated
with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and
logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by
a scheme approved under Professional Standards Legislation.

ENERGY RESOURCES OF AUSTRALIA LTD

CoRPoRAte goveRnAnCe stAtement

The Board of ERA considers high standards of corporate
governance to be critical to business integrity and performance
and to maximise the overall long term return to shareholders.
The Board seeks to ensure that ERA meets the objectives of
its shareholders, while paying proper regard to the interests of
employees and external stakeholders.

The corporate governance structures and practices in place
at ERA are substantially in compliance with the 4th Edition of
the Corporate Governance Principles and Recommendations
(Principles) developed by the ASX Corporate Governance
Council (Council).

The Board has considered the Council’s Principles, and notes
that ERA did not comply with the following recommendation for
the whole of the reporting period:

•

Recommendation 2.4 – there was not a majority of
independent Directors.

As explained further below, the Board considers that this is
appropriate. This Corporate Governance Statement is current
as at 15 March 2022 and has been approved by the Board of
ERA.

Board responsibilities and charter
In carrying out its responsibilities and powers, the Board at all
times recognises its overriding responsibility to act honestly,
fairly, diligently and in accordance with the law in serving the
interests of ERA’s shareholders, employees and the community.

The Board Charter underpins the strategic guidance and
effective management oversight provided by the Board, and
defines the division of responsibility between Board and
management by formal delegation and a system of Board
reserve powers.

Other than as specifically reserved to the Board in the Board
Charter, responsibility for the management of ERA’s business
is delegated to the Chief Executive who is accountable to the
Board.

The Board approves strategy and business plans and monitors
the performance of ERA against these plans. The Board also
monitors compliance with policies prescribed by the Board in
areas such as health and safety, environment, business ethics,
internal control and risk management. These policies are
designed to ensure that ERA meets or exceeds the regulatory
requirements governing its operations.

In addition to the matters expressly required by law to be
approved by the Board, the powers specifically reserved for the
Board are as follows:

Confirming the appointment and removal of a Chief
Executive and the terms and conditions of the Chief
Executive’s employment;
Appointment and removal of a Company Secretary;
Appointment of the Chairman of the Board and members of
Board Committees;
Any matters set out in the Schedule of Matters Reserved
for Decision or Consideration by the Board; and
Approval, subject to the Constitution, the Corporations Act
2001 and the ASX Listing Rules, of each of the following:

•

•
•

•

(i)

(ii)

(iii)
(iv)

(v)

(vi)
(vii)

(viii)

The issue of new shares or other securities in
the Company;
Incurring of debt (other than trade creditors
incurred in the normal course of business);
Capital expenditure in excess of $5,000,000;
The acquisition, divestment or establishment
of any significant business assets;
Changes to the discretions delegated from the
Board;
The annual operating budget;
Changes to the capital and operating approval
limits of senior management; and
The annual report and interim and preliminary
final reports.

The Board receives copies of all material market announcements
promptly after they have been made.

The Board Charter is available at the Corporate Governance
section of ERA’s website.

Composition
The Board of ERA consists of seven Directors, six of whom are
non-executive.

Mr Mansell, Mr Charles, and Mr Dowd all served as independent,
non-executive Directors throughout 2021. Mr Carey and Mr van
Tonder also served as non-executive Directors during the period.
Ms Rosemary Fagen was appointed as a non-executive Director
on 1 February 2022.

Ms Hanrahan, who served as a non-executive Director during the
period, resigned as a Director on 28 April 2021.

On 4 October 2021, Mr Paul Arnold resigned as Managing
Director of the Company.

On 18 February 2022, Mr Brad Welsh was appointed Managing
Director and Chief Executive of the Company.

Mr Mansell, Mr Charles and Mr Dowd were first appointed in
2015, Mr Carey was appointed in 2019, Mr van Tonder was
appointed in 2020 and Ms Fagen and Mr Welsh in 2022.

Skills, experience and diversity
The Board strives to achieve a diversity of skills, experience and
perspective among its Directors. Details of the Directors, their
experience, qualifications and other appointments are set out
on pages 28 to 30. Details of the independent status of each
Director are outlined in the Independence section below.

Qualification for Board membership is driven by the principle that
the Board’s composition should reflect the right balance of skills,
knowledge and diversity that the Board considers will best serve
the interests of ERA and all of its shareholders.

The Board reviews its structure, size and composition regularly.
The Board has not established a Nominations Committee. The
Board considers that its existing practices in reviewing Director
competencies, Board succession planning, Board performance
evaluation and Director selection and nomination carried out
in accordance with the Board Charter, are satisfactory and
appropriate given the size of the Board and ERA’s current
ownership structure.

ENERGY RESOURCES OF AUSTRALIA LTD

CoRPoRAte goveRnAnCe stAtement

The process to identify and nominate new independent Directors
from time to time is led by the incumbent independent Directors.
Decisions relating to the appointment of Directors are made by
the full Board. Directors appointed by the Board are required
by ERA’s Constitution to submit themselves for re-election by
shareholders at the Annual General Meeting following their
appointment. There is no share ownership qualification for
appointment as a Director.

The ERA Board undertakes appropriate background checks and
screening prior to appointing a Director or putting a candidate
to security holders for election as a Director. ERA provides
security holders with all material information in its possession
concerning each Director standing for election or re-election in
the explanatory notes accompanying the notice of meeting.

Non-executive Directors are required to retire at least every
three years in accordance with ERA’s Constitution, but may offer
themselves for re-election. The key attributes that the Board
seeks to achieve in its membership are set out below.

Mining

Health, Safety
and Environment

Financial

Technical

Strategy

Governance

Executive
leadership

Government
relations

Senior executive experience in the
resources industry, including mining,
development, marketing and exploration

Familiarity with issues associated with
workplace health and safety, environment
and social responsibility

Proficiency in financial accounting and
reporting, corporate finance, internal
financial controls, corporate funding and
associated risks

A strong understanding in technical
areas of the resource industry, including
engineering, mining and processing

Proven ability in developing and
implementing successful business
strategies, including the capacity to
probe and challenge management on the
delivery of strategic objectives

Commitment to the highest standards of
governance, including Board experience
with other ASX listed companies that
demonstrate rigorous governance
standards

Sustainable success in business at a
very senior executive level

Interaction with government and
regulators and involvement in public
policy initiatives and decisions

Community
and indigenous
engagement

Experience in engaging with a cross-
section of community and Indigenous
stakeholders

Risk
management

Experience in developing and
establishing risk management
frameworks, setting risk appetite and
overseeing organisational risk culture

Appointment, induction training and professional
development
All new non-executive Directors sign a letter of appointment
which sets out the key terms and conditions of their appointment
including duties, rights and responsibilities, the time commitment
envisaged and the Board’s expectations regarding their
involvement with committee work. There is also a separate
written agreement between ERA and each of its Chief Executive
and senior executives relating to their respective responsibilities
and duties as an officer of the Company (see pages 43 to 45).

Induction training is provided to all new Directors. It includes
comprehensive induction materials, discussions with the Chief
Executive and senior executives and the option to visit the
Company’s operations at Ranger mine, either by appointment or
with the Board during its next site tour. The induction materials
and discussions include information on the Company’s strategy,
culture and values, key corporate and Board policies, the
Company’s financial, operational and risk management position,
the rights and responsibilities of Directors, the role of the Board
and its committees and meeting arrangements.

All Directors are expected to maintain the skills required to
discharge their obligations to the Company. ERA provides
the opportunity for Directors to participate in professional
development activities to develop and maintain the skills and
knowledge needed to perform their role as Directors effectively.

Independence
For the purposes of determining Director independence, the
Board considers any material business relationship which
could interfere, or be perceived to interfere, with the Director’s
independence of judgement, ability to provide a strong, valuable
contribution to the Board’s deliberations and the Director’s
ability to act in the best interests of ERA and shareholders as a
whole. Where contracts in the ordinary course of business exist
between ERA and a company in which a Director has declared
an interest, these are reviewed for materiality to both ERA and
the other party to the contract.

In addition to the examples set out in the Principles, the following
may be taken into account in considering such material business
relationships:

• Whether, within the last three years, the Director or a

close family member has been a member of executive
management of ERA, employed in a senior position with a
member of the Rio Tinto Group or has received additional
remuneration from the Company or a member of the
Rio Tinto Group;

• Whether the Director or a close family member is, or is
associated with, a substantial shareholder (more than
five per cent of the voting shares) in the Company or in
a member of the Rio Tinto Group;
The Director’s cross directorships of, or significant links
with, or involvement in, other companies;
The Director’s length of service on the Board and whether
this may have compromised independence; and

•

• Whether, within the last three years, the Director or a close
family member has had, either directly or indirectly and

ENERGY RESOURCES OF AUSTRALIA LTD CoRPoRAte goveRnAnCe stAtement

whether as principal, employee or consultant, a material
business relationship with ERA or with a member of the
Rio Tinto Group, whether as an auditor, professional adviser,
supplier, or customer (“material” being more than five per
cent of ERA’s or the counterparty’s consolidated gross
revenue per annum).

Mr Mansell, Mr Charles and Mr Dowd are considered by the
Board to be independent Directors.

For the whole reporting period, the Board of Directors did not
consist of a majority of independent Directors. This does not
follow Recommendation 2.4 of the Council’s Principles. However,
the Board considered it was appropriate that the composition of
the Board recognises Rio Tinto’s 86.3 per cent shareholding.

All Directors are required to, and do, bring an independent
judgement to bear on Board decisions and act in accordance
with their statutory duties of good faith and for a proper purpose,
and in the interests of shareholders as a whole.

All related party transactions, including those with Rio Tinto,
have been determined by the independent Directors to be on
arm’s length terms and in the interests of ERA.

Chairman and Chief Executive
The Chairman, Mr Mansell, is an independent non-executive
Director. Mr Mansell’s other appointments are set out
on page 28. The Board considers that none of his other
commitments interfere with the discharge of his duties to ERA.

Mr Brad Welsh was appointed as Acting Chief Executive on
4 October 2021 and Managing Director and Chief Executive on
18 February 2022.

Company Secretary
The Company Secretary is responsible for ensuring that Board
procedures are complied with and that governance matters are
addressed. All Directors have direct access to the Company
Secretary who is accountable directly to the Board, through the
Chairman, on all matters to do with the proper functioning of
the Board. Details of the Company Secretary’s experience and
qualifications are set out on pages 30 and 31.

Board meetings
The Board held eight scheduled meetings and two extraordinary
meetings during 2021. In addition, there were eight meetings held
in 2021 of Committees established by the Board. The Board and
Committee meeting attendance details for Directors in 2021 are
set out on page 32.

Performance self assessment
The Board has a process for periodically evaluating its
performance, as well as the performance of its Committees
and individual Directors. The evaluation and self-assessment
generally takes the form of an internal process facilitated by
the Chairman. After consulting each Director and the Company
Secretary, the Chairman reports a summary of the findings to
all Directors for discussion at the next Board meeting where
relevant actions are agreed. Periodically the Board may utilise
the services of an external consultant to facilitate the process.

The external process takes the form of a questionnaire
completed by each of the Directors and the Company Secretary.
Following collation by the consultant, the results, adequacy and
appropriateness of the self-assessment process are compiled.
A report outlining the results is circulated to all Directors and
discussed at the following Board meeting where actions arising
are agreed.

The Chairman conducted an evaluation of the Board in 2021
obtaining feedback from the Directors on the performance of the
Board and its committees.

Independent professional advice

The Board has adopted a procedure for Directors wishing to seek
independent professional advice, at the Company’s expense, in
the furtherance of their duties. The Board recognises that there
may be circumstances in which individual Directors are entitled
to independent professional advice at the Company’s expense
in the furtherance of their duties, and any Director may do so by
arrangement with the Company Secretary.

Remuneration
ERA’s Constitution provides that the aggregate remuneration
paid to non-executive Directors of ERA in any one year will not
exceed $800,000 or such other amount as may be approved
by shareholders from time to time. At the 2020 Annual General
Meeting, the resolution to increase this limit to $950,000
was approved with 96.80 per cent of shares voting in favour
(voting comprised 3,488,564,371 votes ‘for’ the resolution and
115,041,466 votes ‘against’ the resolution). At the 2021 Annual
General Meeting, the 2020 Remuneration Report was approved
with 99.94 per cent of shares voted in favour (voting comprised
3,189,962,061 votes ‘for’ the resolution and 2,008,443 votes
‘against’ the resolution). North Limited and Peko-Wallsend Pty
Ltd, which are both Rio Tinto entities, voted a combined total of
3,186,682,634 votes ‘for’ the resolution.

In 2012, the Board established a Remuneration Committee.
Throughout 2021, the Remuneration Committee comprised three
non-executive Directors, being Mr Mansell (Chair), Mr Dowd and
Mr Charles, all of whom are independent. A majority of members
constitutes a quorum for a meeting. The Chief Executive may
be invited to attend Remuneration Committee meetings. Other
executives may also be invited to discuss or report on particular
agenda items. The Remuneration Committee held two meetings
during 2021. Attendance details of the 2021 meetings of the
Remuneration Committee are set out in the Directors’ Report on
page 32.

The Remuneration Committee Charter sets out the role and
objectives of the Remuneration Committee. A summary of the
objectives of the Remuneration Committee and the policies and
practices of the Company regarding the remuneration of non-
executive Directors, the Chief Executive and senior executives
is set out on pages 33 to 36 of the Remuneration Report. The
complete Remuneration Committee Charter is available at
the Corporate Governance section of ERA’s website at
www.energyres.com.au.

ENERGY RESOURCES OF AUSTRALIA LTD CoRPoRAte goveRnAnCe stAtement

An annual performance evaluation of the Chief Executive and
senior executives was undertaken in 2021. Details of how the
performance evaluation process is undertaken by the Board in
respect of the Chief Executive and senior executives are set out
on pages pages 38 to 42 of the Remuneration Report.

Audit and Risk Committee
The Audit and Risk Committee is appointed by the Board and
throughout 2021 comprised three non-executive Directors, all
of whom are independent. A majority of members constitutes a
quorum. The present members of the Audit and Risk Committee
are Mr Charles (Chair), Mr Mansell and Mr Dowd. The
Company’s Chief Financial Officer, Chief Executive and General
Counsel & Company Secretary, the external auditor and the
internal auditor are invited to attend all meetings.

The Audit and Risk Committee Charter sets out the role and
terms of reference of the Audit and Risk Committee and is
reviewed regularly. The Audit and Risk Committee Charter is
available at the Corporate Governance section of ERA’s website.

The Committee provides a formal structure for reviewing ERA’s
financial statements, accounting policies, control systems, risk
management practices and taxation issues and for liaison with
the external and internal auditors. The Committee also reviews
the adequacy of internal and external audit arrangements.

The Audit and Risk Committee advises the Board of any matters
that might have a significant impact on the financial condition
of ERA and has the authority to investigate any matters within
its terms of reference, having full access to the information and
resources of ERA to fulfil its function. Related party transactions
are considered by the Audit and Risk Committee. The Audit and
Risk Committee reviews compliance with the Corporations Act
2001, and the requirements of the ASX and other regulatory
requirements.

The Audit and Risk Committee held three meetings during
2021. Attendance details of the 2021 meetings of the Audit and
Risk Committee, and the qualifications and experience of the
members, are set out in the Directors’ Report on pages 32 and
28 to 29 respectively.

Each year the external auditor submits a schedule of audit
services and fee estimate to the Audit and Risk Committee
for consideration and approval. KPMG is appointed as ERA’s
external auditor for 2021. Each year, the Audit and Risk
Committee reviews the effectiveness of the external audit
process and the independence of the auditor. Based on its
2021 review, the Audit and Risk Committee was satisfied
with the external audit process and that the external auditor
remained independent. Any work to be conducted by the external
auditor other than the audit is approved by the Audit and Risk
Committee.

Details of the fees paid to KPMG during 2021 are outlined on
page 50.

Sustainability Committee
The Sustainability Committee is appointed by the Board and
ordinarily comprises three non-executive Directors. A majority
of members constitutes a quorum. Throughout 2021, Mr Dowd
(Chair), Mr Charles and Mr van Tonder were members of the
Sustainability Committee. The Company’s Chief Executive,
General Manager Operations and Company Secretary are
invited to attend all meetings.

The Sustainability Committee Charter sets out the role and
objectives of the Sustainability Committee and is reviewed
regularly. It is available at the Corporate Governance section of
ERA’s website.

The Committee provides a formal structure to further support
governance and initiatives for improvement in the sustainability
of ERA operations, including health, safety and environmental
management.

The Sustainability Committee held three scheduled meetings
during 2021. Attendance details of the 2021 meetings of the
Sustainability Committee, and the qualifications and experience
of the members, are set out in the Directors’ Report on pages 32
and 28 to 30 respectively.

The Health, Safety and Environment Committee was renamed
the Sustainability Committee during the reporting period.

Rehabilitation Committee
On 7 October 2021, the Board established a Rehabilitation
Committee, membership of which comprises Mr Dowd (Chair),
Mr Charles and Mr van Tonder. The Committee is mandated to
receive and share information on, and review and evaluate, key
aspects of risk, performance and activities of the Ranger Closure
Project and to provide feedback and recommendations to the
Board. In the period from establishment to 31 December 2021,
preparatory and research work was undertaken but no formal
committee meetings were held.

Independent Board Committee
In May 2020, the Board adopted a Conflicts of Interests and
Related Party Transactions Policy. The purpose of the Policy
is to outline a process for identification, review, approval and
disclosure of Related Party Proposals, with a view to ensuring
that all decisions of the Board are made in the best interests
of the Company as well as ensuring compliance with the
law. The Board also formally established the Independent
Board Committee (IBC) of directors who are considered to be
independent of Rio Tinto, being Mr Mansell (Chair), Mr Dowd
and Mr Charles. The IBC has been delegated all of the powers,
authorities and discretions of the Board with respect to any
transaction or proposal:

•

In which, in the opinion of the Chairman of the IBC, a
Related Party has or may have interests other than its
interest as shareholder in common with other shareholders;
or

• Where, in the opinion of the Chairman of the IBC, the

interests of ERA and a Related Party conflict or may appear
to conflict, excluding any transaction or proposal in which a
member of the IBC is a conflicted Director.

ENERGY RESOURCES OF AUSTRALIA LTD CoRPoRAte goveRnAnCe stAtement

For so long as Rio Tinto has a controlling interest in the
Company, Rio Tinto will be taken to be a Related Party for this
purpose. A copy of the Policy (including IBC’s Charter) are
available on the Company’s website at https://www.energyres.
com.au/uploads/general/200505_Conflicts_policy_and_
Independent_Committee_Charter_(FINAL).pdf.

Diversity
ERA acknowledges the benefits that flow from advancing Board
and employee diversity, in particular gender and Indigenous
diversity. These benefits include identification and rectification
of gaps in the skills and experience of Directors and employees,
enhanced employee retention, greater innovation and
maximisation of available talent to achieve corporate goals
and increased financial performance.

Diversity, in the context of the Company, primarily refers to
groups which are underrepresented in its workforce. ERA has a
particular focus on the representation of women and Indigenous
people in its workforce. ERA’s policy on diversity can be found on
the Company’s website at www.energyres.com.au. In accordance
with the Company’s diversity policy, ERA has set measurable
objectives to achieve diversity.

The objectives and the Company’s progress in achieving each
objective are set out below:

OBJECTIVE

OUTCOME

Women to represent 20 per
cent of the senior executives
(being manager level and
above) and the Board by end
of 2021.

Target Indigenous
employment of 15 per cent
by the end of 2021.

As at 31 December 2021
female participation at manager,
Executive Committee and Board
level is 12 per cent. Although
there were no female Directors
as at 31 December 2021,
female participation increased
to 14% of Directors upon
Rosemary Fagen’s appointment
in February 2022. Total female
participation is 19 per cent.

ERA ended 2021 with an
Indigenous employment rate
of six per cent. 17 per cent of
Indigenous employees were
female and three employees
held supervisor leadership roles.

As at 31 December 2021, the proportion of women employed by
ERA was as follows:

Code of business conduct
We have clear standards around bribery and corruption, conflicts
of interest, antitrust, benefits, sponsorships and donations, data
privacy, fraud and third party due diligence. ERA has a Code of
Business Conduct to be met by all employees and Directors. All
employees are required to maintain high standards of ethical
behaviour in the execution of their duties and comply with all
applicable laws and regulations in Australia and in every other
country in which the Company engages in business.

The Code of Business Conduct is reviewed to ensure it
adequately addresses the issues facing the Company and is
available for inspection on the Corporate Governance section of
the Company’s website at www.energyres.com.au.

In addition to the Company’s Code of Business Conduct, the
Company’s employees are required to comply with Rio Tinto’s
statement of business practice The Way We Work, available at
Rio Tinto’s website at www.riotinto.com. This includes ERA’s
values and provides a clear framework for how we should
conduct our business.

The Company uses Rio Tinto’s confidential whistleblower
program known as ‘myVoice’. It offers an avenue through which
our employees, contractors, suppliers and customers can
report concerns anonymously, subject to local law. Employees
are encouraged to report any suspicion of unethical or illegal
practices. Further details regarding the program are available in
the Corporate Governance section of the Company’s website at
www.energyres.com.au.

The Board is informed of any material breaches and incidents
reported under its Code of Business Conduct, whistleblower
policy or anti bribery and corruption policy.

Purchase and sale of Company securities
ERA has in place a formal policy that reinforces to all Directors,
officers and employees the prohibitions against insider trading.
The Share Trading Policy is available for inspection at the
Corporate Governance section of the Company’s website at
www.energyres.com.au.

In addition, the “Rules for dealing in securities of Rio Tinto”
(Dealing Rules) apply to the participation of ERA executives in
the Rio Tinto long term incentive plans involving the awarding
of Rio Tinto securities at a future date. Any such grants of
shares and options under the Rio Tinto plans are subject to,
and conditional upon, compliance with the terms of the Dealing
Rules, including an express prohibition on hedging or limiting of
exposure to economic risk in relation to such securities.

Board of Directors

Executive Committee and
managers

Company

Under the ERA Share Trading Policy:

17%

19%

•

Directors, senior executives and senior managers must
advise the Chairman in writing, and receive approval in
writing from the Chairman, if they intend to purchase or sell
ERA securities.
In regard to his own dealings, the Chairman is required to
notify the Chair of the Audit and Risk Committee.
No dealings in ERA securities may take place for the period
from the end of any relevant financial period to the trading

ENERGY RESOURCES OF AUSTRALIA LTD CoRPoRAte goveRnAnCe stAtement

day following announcement of ERA’s annual results or half
year results.

Particulars of the interests held by Directors are outlined on
page 32 of the Director’s Report.

Risk identification and management
ERA has in place a range of policies and procedures to manage
the risks associated with its operating activities. These policies
and procedures have been adopted by the Board, with primary
oversight by the Audit and Risk Committee, to ensure that potential
business risks are identified and appropriate action taken.

The Company has an annual internal audit program that is
determined by the Audit and Risk Committee. The annual internal
audit program is executed by an outsourced provider which
reports back to the Audit and Risk Committee on its assessment
of the Company’s control environment. In addition, the Company
Secretary provides support for internal audit planning activities
and the monitoring of actions implemented by the Company in
response to findings raised by the internal auditor.

ERA benefits from the Rio Tinto Group’s knowledge, policies
and practices on risk management and corporate assurance,
developed to manage Rio Tinto’s diverse business activities
covering a variety of commodities and operational locations.
Together, these make up a comprehensive framework and
approach to risk analysis and risk management.

The Board has in place a number of systems to identify and
manage business risks. These include:

•

The identification and review of all of the business risks
known to be facing the Company;
The provision of reports and information by management
to the Board, on a periodic basis, confirming the status and
effectiveness of the plans, controls, policies and procedures
implemented to manage business risks;

• Guidelines for ensuring that capital expenditure and revenue

•

•
•

commitments exceeding certain approved limits are placed
before the Board for approval;
Limits and controls for all financial exposures, including the
use of derivatives;
A regulatory compliance program; and
Safety, health and environmental policies which are supported
by a set of standards and management systems which
recognise the Company’s commitment to achieving high
standards of performance in all its activities in these areas.

The Audit and Risk Committee reviews ERA’s risk management
framework at least annually, and did so in 2021, to satisfy itself
that it continues to be sound.

The Audit and Risk Committee and the Board has assessed the
strategic risks to the Company’s business and the mitigation
strategies to be implemented by management. The strategic
risks identified through this assessment were future operating
cash flow and financial resources, stakeholder support of the
Company’s strategic initiatives, rehabilitation of the Ranger
Project Area, internal constraints relating to the Company’s

licence to operate, external events relating to the Company’s
licence to operate and retention and recruitment of key
personnel.

These strategic risks are in addition to risks inherent to the
mining industry generally which include economic conditions
(fluctuations in commodity pricing and exchange rates),
international regulation of greenhouse gas emissions and impact
of climatic conditions. More information on ERA’s business risks,
including any material exposure to economic, environmental
and social sustainability risks, is set out on pages 15 to 19 of
the Annual Report.

Each reporting period, the Chief Executive and the Chief
Financial Officer give statements to the Board that, in their
opinion, the financial records of the Company have been
properly maintained and that the financial statements comply
with the Australian Accounting Standards and give a true and fair
view of the Company’s financial position and performance. The
statements also provide that the opinion has been formed on the
basis of a sound system of risk management and internal control
which is operating effectively in all material respects.

Public statements and disclosure matters
ERA makes full and immediate disclosures to its shareholders
and the market as required by, and in accordance with, its legal
and regulatory obligations. Established systems are in place
to ensure compliance and matters that may have a material
impact on the price or value of ERA’s securities are reported to
the market in accordance with the ASX Listing Rules and the
Corporations Act 2001. ERA’s Continuous Disclosure Policy
is available at the Corporation Governance section of ERA’s
website at www.energyres.com.au.

Management is responsible for establishing and maintaining
adequate internal controls over financial reporting. These
controls, supervised by the Chief Executive and Chief Financial
Officer, provide reasonable assurance regarding the reliability
of the Group’s financial reporting and the preparation and
presentation of financial statements for external reporting
purposes, in accordance with International Financial Reporting
Standards (IFRS). The Company’s internal controls over financial
reporting include policies and procedures designed to ensure
the maintenance of records that: (i) accurately and fairly reflect
transactions and dispositions of assets; (ii) provide reasonable
assurances that transactions are recorded as necessary,
enabling the preparation of financial statements in accordance
with IFRS, and (iii) receipts and expenditures are made with
the authorisation of management and directors of each of the
companies.

Modern Slavery Statement
ERA is a reporting entity under the Australian Modern Slavery Act
2018 (Cth) and will be included in Rio Tinto’s joint 2021 Modern
Slavery Statement which will be published on behalf of the
reporting entities in the Rio Tinto Group.

ENERGY RESOURCES OF AUSTRALIA LTD CoRPoRAte goveRnAnCe stAtement

Shareholder communication
ERA recognises the importance of effective communication with
shareholders and the general investment community. Apart from
ERA’s compliance with its mandatory continuous disclosure
obligations, ERA takes steps to ensure that its shareholders
and other stakeholders are kept informed. Full advantage is
taken of the Annual General Meeting to inform shareholders of
current developments and to give shareholders the opportunity
to ask questions. KPMG, ERA’s external auditor attends the
Annual General Meeting and is available to answer shareholder
questions about the conduct of the audit and the preparation and
content of the auditor’s report. ERA shareholders are also able
to submit written questions regarding the conduct of the audit
and the statutory audit report to the auditor via the Company. Any
questions received and answers provided will be made available
to members at the Annual General Meeting. Shareholders who
are unable to attend meetings are encouraged to appoint a proxy
to vote either as they direct or at their discretion.

ERA believes that investor seminars, presentations and briefings
on financial and operational issues, including social and
environmental performance, are valuable ways of communicating
with relevant professionals, employees and other interested
persons when required. The Chief Executive and Chief Financial
Officer are available for regular meetings with the Company’s
major investors.

When conducted, ERA gives equal access to information
disclosed in investor seminars, presentations and briefings.
If any such event is used to disclose new material, it will,
in advance or simultaneously, be disclosed to the ASX and
available on ERA’s website.

ERA provides shareholders with the option to receive
communications from, and send communications to, the
Company and the share registrar electronically. The contact
details are available on the Company’s website.

ENERGY RESOURCES OF AUSTRALIA LTD stAtement oF ComPReHensIve InCome

FOR THE YEAR ENDED 31 DECEMBER 2021

Revenue from continuing operations

Changes in inventories

Materials and consumables used

Employee benefits and contractor expenses

Government and other royalties

Commission and shipping expenses

Depreciation and amortisation expenses

Changes in estimate of rehabilitation provision

Financing costs

Statutory and corporate expenses

Other expenses

Profit/(loss) before income tax

Income tax (expense)/benefit

Profit/(loss) for the year

Other comprehensive income/(loss)

Items that will be reclassified subsequently to profit or loss:

Changes in the fair value of cash flow hedges

Income tax relating to components & other comprehensive income

Other comprehensive income/(loss) for the year, net of tax

Total comprehensive income/(loss) for the year

Profit/(loss) is attributable to:

Owners of Energy Resources of Australia Ltd

Total comprehensive income/(loss) for the year is attributable to:

Owners of Energy Resources of Australia Ltd

Earnings per share for profit/(loss) attributable to the
ordinary equity holders of the Company:

Basic earnings/(loss) per share (cents)

Diluted earnings/(loss) per share (cents)

NOTES

2021
$’000

2020
$’000

201,007

254,891

(119,673)

(13,988)

(1,618)

(71,818)

(21,821)

(101,304)

(9,891)

(2,585)

(354)

(668,149)

(12,517)

(5,069)

(353)

(6,529)

(19,529)

(24,949)

(4,158)

(624)

(647,395)

(2,817)

(9,260)

(461)

8,643

2,817

(650,212)

11,460

(9,391)

2,817

(6,574)

(656,786)

9,391

(2,817)

6,574

18,034

(650,212)

11,460

(656,786)

18,034

(17.6)

0.4

The above statement of comprehensive income should be read in conjunction with the accompanying notes.

ENERGY RESOURCES OF AUSTRALIA LTD BALAnCe sHeet

AS AT 31 DECEMBER 2021

ASSETS

Current assets

Cash and cash equivalents

Trade and other receivables

Inventories

Government security receivable

Derivative financial instruments

Other

Total current assets

Non-current assets

Inventories

Undeveloped properties

Property, plant and equipment

Derivative financial instruments

Government security receivable

Total non-current assets

Total assets

LIABILITIES

Current liabilities

Trade and other payables

Lease liabilities

Provisions

Total current liabilities

Non-current liabilities

Lease liabilities

Provisions

Total non-current liabilities

Total liabilities

Net assets/(deficit)

EQUITY

Contributed equity

Reserves

Accumulated losses

Total equity/(deficit)

The above balance sheet should be read in conjunction with the accompanying notes.

NOTES

2021
$’000

2020
$’000

163,872

204,350

33,375

29,613

65,400

3,451

829

7,788

132,704

123,316

12,423

2,030

296,540

482,611

89,856

469,442

559,390

15,423

89,856

1,756

580

409,927

517,542

855,930

1,000,153

36,803

232,732

269,628

1,028,724

1,298,352

(442,422)

39,290

1,583

188,399

229,272

186

556,116

556,302

785,574

214,579

1,177,656

388,594

395,383

(2,008,672)

(1,358,460)

(442,422)

214,579

ENERGY RESOURCES OF AUSTRALIA LTD stAtement oF CHAnges In eQUIty

FOR THE YEAR ENDED 31 DECEMBER 2021

Balance at 1 January 2020

Profit/(loss) for the year

Other comprehensive income

Total comprehensive income for the year

Transactions with owners in their capacity as owners:

Contributions of equity – net of transaction cost

Employee share options – value of employee services

Balance at 31 December 2020

Profit/(loss) for the year

Other comprehensive income/(loss)

Total comprehensive income/(loss) for the year

Transactions with owners in their capacity as owners:

Contributions of equity – net of transaction cost

Employee share options – value of employee services

CONTRIBUTED
EQUITY
$’000

RESERVES
$’000

ACCUMULATED
LOSSES
$’000

NOTES

TOTAL
$’000

706,485

388,748

(1,369,920)

(274,687)

471,171

6,574

11,460

6,574

18,034

471,171

471,232

1,177,656

395,383

(1,358,460)

214,579

(650,212)

(6,574)

(650,212)

(656,786)

(215)

Balance at 31 December 2021

1,177,656

388,594

(2,008,672)

(442,422)

The above statement of changes in equity should be read in conjunction with the accompanying notes.

ENERGY RESOURCES OF AUSTRALIA LTD CAsH FLow stAtement

FOR THE YEAR ENDED 31 DECEMBER 2021

CASH FLOW FROM OPERATING ACTIVITIES

Receipts from customers

(inclusive of goods and services tax)

Payments to suppliers and employees

(inclusive of goods and services tax)

Payments for rehabilitation

Interest received

Financing costs paid

NOTES

2021
$’000

2020
$’000

194,155

268,885

(78,552)

(209,596)

115,603

(153,149)

343

(731)

59,289

(80,190)

2,673

(1,052)

Net cash (outflow)/inflow from operating activities

(37,934)

(19,280)

CASH FLOW FROM INVESTING ACTIVITIES

Payments for property, plant and equipment

Contributions to government security receivable

Net cash (outflow)/inflow from investing activities

CASH FLOW FROM FINANCING ACTIVITIES

Payment of lease liabilities

Proceeds from issues of shares

Share issue transaction costs

Employee share option payments

Net cash (outflow)/inflow from financing activities

Net increase/(decrease) in cash and cash equivalents

Cash and cash equivalents at the beginning of the financial year

Effects of exchange rate changes on cash and cash equivalents

(43)

(193)

(454,000)

(454,193)

(1,677)

(835)

(2,512)

(40,489)

204,350

(2,408)

476,049

(2,791)

(1,616)

469,234

(4,239)

208,591

(2)

Cash and cash equivalents at end of year

163,872

204,350

The above cash flow statement should be read in conjunction with the accompanying notes.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Summary of significant
accounting policies

The principal accounting policies adopted in the preparation
of these financial statements are set out below. These policies
have been consistently applied to all the years presented,
unless otherwise stated. The financial statements are for Energy
Resources of Australia Ltd (ERA).

(a) Basis of preparation
This general purpose financial report has been prepared
in accordance with Australian Accounting Standards and
interpretations issued by the Australian Accounting Standards
Board, and the Corporations Act 2001. The financial report has
been prepared under the assumption that the Company is a
going concern.

(i) Going Concern

As at 31 December 2021, ERA has a net liability position of
$442 million, it has also experienced operating losses and
negative cash flows during the financial year ending on that
date. As a result of the rehabilitation provision increase of
$668m during 2021, ERA has insufficient funds to fully fund its
rehabilitation obligation.

ERA is continuing to review all funding options. An inability
to obtain sufficient funding would have a material impact on
ERA being able to continue as a going concern. Rio Tinto
has reiterated its commitment to ensuring the rehabilitation
of the Ranger Project Area is successfully achieved to the
appropriate standards. ERA is in ongoing discussions with major
shareholders about a funding solution.

Each year, ERA is required to prepare and submit to the
Commonwealth Government an Annual Plan of Rehabilitation
(APR). Once accepted by the Commonwealth Government, the
annual plan is then independently assessed and costed and the
amount to be provided by ERA into the Ranger Rehabilitation
Trust Fund (Trust Fund) is then determined. The Trust Fund
includes both cash and financial guarantees. The 45th Annual
Plan of Rehabilitation is currently being undertaken to align
with the conclusion of processing which occurred on 8 January
2021 and consider impacts identified through the rehabilitation
reforecast process. Further work on the reforecast and alterations
to the Pit 3 capping strategy are ongoing. This review may revise
the determined security position which may require additional
funding requirements. ERA has commenced discussions with the
Commonwealth Government to consider potential implications
and timing for its security requirements.

Currently, ERA has $125m in bank guarantees to the
Commonwealth Government over the 44th Annual Plan of
Rehabilitation which was finalised in February 2020. Issuers of
the bank guarantees have certain pay and walk rights and the
guarantees are subject to periodic reviews. Should the banks
execute their pay and walk rights or ERA is unable to access
bank guarantees, substantial additional cash would be required
to indemnify the banks or be deposited into the trust fund. ERA
continues to maintain regular dialogue with its major relationship
banks.

ERA’s ability to fund its rehabilitation obligations, including any
additional security requirements and its ability to continue as
a going concern and meet its debts and commitments as they
fall due are dependent upon it being successful in obtaining
additional funding support from its shareholders.

As a result of these matters, there is a material uncertainty that
may cast significant doubt on ERA’s ability to continue as a going
concern and, therefore, that it may be unable to realise its assets
and discharge its liabilities in the normal course of business.
However, the directors believe that ERA will be successful in
obtaining additional funding support from its shareholders, and
that the APR security requirements will continue to be covered by
a mix of, cash on deposit and bank guarantees. Accordingly, the
financial report has been prepared on a going concern basis.

(ii) Compliance with IFRS

The financial statements of the Company also comply with
International Financial Reporting Standards (IFRS) as issued by
the International Accounting Standards Board (IASB).

(iii) Historical cost convention

These financial statements have been prepared under the
historical cost convention, except for where specifically outlined
that an alternative basis has been used within Note 1.

(iv) Critical accounting estimates

The presentation of financial statements requires the use of
certain critical accounting estimates. It also requires management
to exercise its judgement in the process of applying the
accounting policies of the Company. The areas involving a higher
degree of judgement or complexity, or areas where assumptions
and estimates are significant to the financial statements, are
disclosed in Note 2.

(b) Principles of consolidation

(i) Subsidiaries

ERA has no subsidiaries and is referred to in the financial report
as the Company or ERA.

Subsidiaries are all those entities (including special purpose
entities) over which the Company has the power to govern
the financial and operating policies, generally accompanying
a shareholding of more than one half of the voting rights. The
existence and effect of potential voting rights that are currently
exercisable or convertible are considered when assessing
whether the Company controls another entity.

(c) Revenue recognition
Revenue is measured at the fair value of the consideration
received or receivable. Amounts disclosed as revenue are net
of returns, trade allowances, rebates and amounts collected on
behalf of third parties.

The Company recognises revenue when the amount of revenue
can be reliably measured. It is probable that future economic
benefits will flow to the entity and the criteria pertaining to the
transfer of control of goods or rendering of services has been met
as described in the sections below.

ENERGY RESOURCES OF AUSTRALIA LTD

notes to tHe FInAnCIAL stAtements

(i) Sale of goods

(d) Foreign currency translation

ERA places all sales through a marketing agreement with Rio
Tinto Marketing PTE Limited (Rio Tinto Uranium) based in
Singapore (Marketing Agreement).

Certain sales may be provisionally priced at the date revenue
is recognised. Sales revenue is accounted for under AASB
15 ‘Revenue from Contracts with Customers’ and subsequent
movements in provisionally priced receivables is accounted for
under AASB 9 ‘Financial Instruments’.

Revenue from contracts with customers is recognised on
provisionally priced sales based on the selling price for the period
stipulated in the contract. This is because it is highly probable
that the revenue would not be subject to a significant revenue
reversal based on an estimate formed from historical evidence.

As noted above, certain sales may be provisionally priced at
the date revenue is recognised. However, all Uranium sales are
reflected at final prices in the results for the period due to the
majority of sales being settled prior to the period end. The final
selling price for all provisional priced products is based on the
price for the quotatational period, stipulated in the contract. The
change in value of the provisionally priced receivable is based on
relevant market prices and is included in sales revenue as noted
above.

Sales revenue is recognised on individual sales when control
transfers to the customer. This occurs when the uranium
transfers from the Company’s account at converter locations to
its customers account. It is at this stage under the respective
arrangement that the company no longer can control or direct
goods.

There is only one performance obligation, being for provision of
product at the point where control passes.

Sales revenue excludes any applicable sales taxes. Mining
royalties payable are presented as an operating cost.

Receipts from sales revenue are generally received 30 days from
the date of sale.

(ii) Rendering of services

Revenue from the rendering of services is recognised when the
service is provided.

(iii) Other revenue/income

Other revenue/income recognised by the Company includes:

•

•
•

•

•
•

Interest income, which is recognised on a time proportion
basis using the effective interest rate method;
Rental income, which is recognised on a straight line basis;
Net gains on disposal of assets, which is recognised at the
date control of the asset passes to the acquirer;
Contract compensation, which is recognised upon
cancellation of a sales contract;
Foreign exchange gains; and
Insurance recoveries, which is recognised on confirmation
from the insurer that the claim payment has been approved.

(i) Functional and presentation currency

Items included in the financial statements are measured using
the currency of the primary economic environment in which
the entity operates (“the functional currency”). The financial
statements are presented in Australian dollars, which is the
Company’s functional and presentation currency.

(ii) Transactions and balances

Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of
the transactions. Foreign exchange gains and losses resulting
from the settlement of such transactions and from the translation
at year end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in the
statement of comprehensive income; except when they are
deferred in equity as qualifying cash flow hedges and qualifying
net investment hedges or are attributable to part of the net
investment in a foreign operation.

(e) Financing costs
Financing costs (including interest) are included in the statement
of comprehensive income in the period during which they are
incurred; except where they are included in the cost of non-
current assets that are currently being developed and will take
a substantial period of time to complete. The borrowing costs
included in the cost of such developments are those costs that
would have been avoided if the expenditure on the development
had not been made.

Once the asset is ready for use, the capitalised borrowing costs are
depreciated as a part of the carrying amount of the related asset.

The capitalisation rate used to determine the amount of
borrowing costs to be capitalised is the weighted average interest
rate applicable to the Company’s outstanding borrowings during
the year.

(f) Income tax
Income tax expense for the period is the tax payable on the
current period’s taxable income based on the applicable income
tax rate adjusted by temporary differences between the tax bases
of assets and liabilities and their carrying amounts in the financial
statements, and to unused tax losses.

The current income tax charge is calculated on the basis of
the tax laws enacted or substantively enacted at the end of the
reporting period in the country where the Company generates
taxable income (Australia).

Deferred income tax is provided in full, using the liability method,
on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial
statements. However, the deferred income tax is not accounted
for if it arises from initial recognition of an asset or liability in
a transaction, other than a business combination that at the
time of the transaction affects neither accounting nor taxable
profit or loss. Deferred income tax is determined using tax rates

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

(and laws) that have been enacted or substantially enacted by
the reporting date and are expected to apply when the related
deferred income tax asset is realised or the deferred income tax
liability is settled.

Deferred tax assets are recognised for deductible temporary
differences and unused tax losses only if it is probable that future
taxable amounts will be available to utilise those temporary
differences and losses.

Deferred tax assets and liabilities are offset when there is a
legally enforceable right to offset current tax assets and liabilities
and when the deferred tax balances relate to the same taxation
authority. Current tax assets and tax liabilities are offset where
the entity has a legally enforceable right to offset and intends
either to settle on a net basis, or to realise the asset and settle
the liability simultaneously.

Current and deferred tax balances attributable to amounts
recognised directly in equity are also recognised directly in equity.

(g) Trade and other receivables
Trade receivables are recognised at fair value.The company
applies the forward looking expected credit loss model required
by AASB 9, using the simplified approach for its trade receivables
portfolio review and the general approach for all other financial
assets as required by the standard.

Trade receivables are normally settled within 45 days and are
carried at amounts due. The collectability of trade receivables is
reviewed on an ongoing basis and specific provisions are made
for any doubtful amounts. Receivables which are known to be
uncollectible are written off.

Other receivables relate to transactions outside the usual
operating activities of the Company and are predominantly
concerned with rental receipts from employees and businesses
located within the Jabiru township. These ongoing activities
are expected to be settled during the 12 months subsequent
to balance date but are assessed regularly and impaired
accordingly.

(h) Financial instruments
Financial assets and financial liabilities are recognised in ERA’s
Balance Sheet when ERA becomes a party to the contractual
provisions of the instrument.

Financial assets and financial liabilities are initially measured at
fair value. Transaction costs that are directly attributable to the
acquisition or issue of financial assets and financial liabilities
(other than financial assets and financial liabilities at fair value
through profit or loss) are added to or deducted from the fair
value of the financial assets or financial liabilities, as appropriate,
on initial recognition. Transaction costs directly attributable to the
acquisition of financial assets or financial liabilities at fair value
through profit or loss are recognised immediately in profit or loss.

Management uses valuation techniques to determine the fair
value of financial instruments (where active market quotes
are not available) and non-financial assets. This involves
developing estimates and assumptions consistent with how
market participants would price the instrument. Management

bases its assumptions on observable data as far as possible,
but this is not always available. In that case management uses
the best information available. Estimated fair values may vary
from the actual prices that would be achieved in an arm’s length
transaction at the reporting date.

(i) Derivative financial instruments

ERA enters into both forward foreign exchange contracts and
gasoil swap contracts. These contracts are used to manage
ERA’s exposure to US dollar sales and the price of diesel used
to run major mine infrastructure.

Derivatives are recognised initially at fair value at the date
a derivative contract is entered into and are subsequently
remeasured to their fair value at each reporting date. The
resulting gain or loss is recognised in the profit or loss
immediately unless the derivative is designated and effective as
a hedging instrument, in which event the timing of the recognition
in profit or loss depends on the nature of the hedge relationship.

A derivative with a positive fair value is recognised as a
financial asset whereas a derivative with a negative fair value
is recognised as a financial liability. Derivatives are not offset
in the financial statements unless ERA has both legal right and
intention to offset. A derivative is presented as a non-current
asset or a non-current liability if the remaining maturity of the
instrument is more than 12 months and it is not expected to
be realised or settled within 12 months. Other derivatives are
presented as current assets or current liabilities.

(ii) Hedge Accounting

ERA designates forward exchange contracts as hedging
instruments in the form of cash flow hedges. At the inception of
the hedge relationship, ERA documents the relationship between
the hedging instrument and the hedged item, along with its risk
management objectives and its strategy for undertaking hedge
transactions. Furthermore, at the inception of the hedge and
on an ongoing basis, ERA documents whether the hedging
instrument is effective in offsetting changes in fair values or cash
flows of the hedged item attributable to the hedged risk, which is
when the hedging relationships meet all of the following hedge
effectiveness requirements:

•

There is an economic relationship between the hedged item
and the hedging instrument;
The effect of credit risk does not dominate the value
changes that result from that economic relationship; and
The hedge ratio of the hedging relationship is the same as
that resulting from the quantity of the hedged item that ERA
actually hedges and the quantity of the hedging instrument
that ERA actually uses to hedge that quantity of hedged item.

(iii) Cash flow hedges

The effective portion of changes in the fair value of derivatives
and other qualifying hedging instruments that are designated
and qualify as cash flow hedges is recognised in other
comprehensive income and presented in the cash flow hedge
reserve under equity. The gain or loss relating to the ineffective
portion is recognised immediately in profit or loss and is
included in the ‘other gains and losses’ line item. Sources of

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

ineffectiveness include the effect of credit risk on the hedging
instrument and the mismatch of the timing of settlements
between the hedged item and the hedging instrument.

Work in progress inventory includes ore stockpiles and other
partly processed material. Quantities are assessed primarily
through surveys and assays.

Amounts previously recognised in other comprehensive income
and accumulated in equity are reclassified to profit or loss in the
periods when the hedged item affects profit or loss, in the same
line as the recognised hedged item.

ERA discontinues hedge accounting only when the hedging
relationship (or a part thereof) ceases to meet the qualifying criteria
(after rebalancing, if applicable). This includes instances when the
hedging instrument expires or is sold, terminated or exercised.
The discontinuation is accounted for prospectively. Any gain or
loss recognised in other comprehensive income and accumulated
in cash flow hedge reserve at that time remains in equity and is
reclassified to profit or loss when the forecast transaction occurs.
If the forecast transactions are no longer expected to occur, the
gain or loss accumulated in cash flow hedge reserve in equity is
reclassified to profit or loss immediately.

Unrecognised gains and losses recorded in the hedge reserve will
give rise to a deferred tax asset or liability. This is recorded in the
cash flow hedge reserve. ERA then considers if this is recoverable
in the event it is a deferred tax asset. In the event it is a deferred
tax liability, ERA considers whether unrecognised deferred tax
assets should be recognised to offset the liability. Where this
occurs the recognition of the deferred tax asset is recorded
through income tax benefit in the profit and loss statement.

(iv) Fair value measurement

When measuring the fair value of its assets and liabilities, the
Company uses observable market data. All assets and liabilities
measured at fair value, including hedging instruments, use Level
1 valuation techniques: quoted prices (adjusted) in active markets
for identical assets or liabilities. Note 31, under the heading ‘Fair
Value Estimation’, details those balances that are measured at
fair value.

(i) Inventories
Inventories are carried at the lower of cost and net realisable
value. Net realisable value for uranium is determined based on
estimated future sales prices, exchange rates and capital and
production costs, including transport. Net realisable value for
stores is determined based on management’s estimate of the
extent to which the inventory is usable.

Inventory is valued using the weighted average cost method and
includes both fixed and variable production costs, as well as cash
and non-cash charges. For stores, the costing includes solely
material purchase prices.

Stockpiles represent ore that has been extracted and is available
for further processing. If there is significant uncertainty as
to when the stockpiled ore will be processed it is expensed
as incurred. Where the future processing of this ore can be
predicted with confidence, for example because it exceeds the
mine’s cut-off grade, it is valued at the lower of cost and net
realisable value.

Stores are valued at the lower of cost or net realisable value and
are impaired accordingly to take into account obsolescence. The
Company discloses obsolescence changes in Note 9.

Uranium inventories are split between a current and non-current
assets classification, based on management’s estimate on when
it will realise economic benefit from the sale of inventories.
Management performs this estimate based on sales schedules
with its customers and historical experience around sales timing.

(j) Impairment of assets
Assets are tested for impairment whenever events or changes
in circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for the amount
by which the asset’s carrying amount exceeds its recoverable
amount. The recoverable amount is the higher of an asset’s fair
value, less cost to sell and value in use. For the purposes of
assessing impairment, assets are grouped at the lowest levels
for which there are separately identifiable cash flows (cash
generating units).

Fair value is determined as the amount that would be obtained
from the sale of the asset in an arm’s length transaction.

The value in use is determined using the present value of the
future cashflow expected to be derived from an asset or cash
generating unit.

(k) Property, plant and equipment

(i) Acquisition

Items of property, plant and equipment are recorded at historical
cost and, except for land, are depreciated over their useful life.
Historical cost includes expenditure that is directly attributable
to the acquisition of the items. Subsequent costs are included in
the asset’s carrying amount, or recognised as a separate asset
- as appropriate, only when it is probable that future economic
benefits associated with the item will flow to the Company and
the cost of the item can be measured reliably. Repairs and
maintenance are charged to the statement of comprehensive
income during the period in which they are incurred.

(ii) Depreciation and amortisation

All ERA’s property, plant and equipment (excluding right of use
assets) is currently fully impaired. Property, plant and equipment
expenditure incurred is recorded directly in other expenses.

(l) Leases
Leases are recognised as a right-of-use asset and a
corresponding liability at the date at which the leased asset
is available for use by the Company. Each lease payment is
allocated between the liability and finance cost. The finance cost
is charged to profit or loss over the lease period so as to produce
a constant periodic rate of interest on the remaining balance of
the liability for each period.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

The right-of-use asset is shown as a non-current asset and
depreciated over the shorter of its useful life and the lease terms
on a straight line basis. As right-of-use assets represent an
economic benefit they are not impaired, as is the case for other
Ranger cash generating unit (CGU) assets.

Assets and liabilities arising from a lease are initially measured
on a present value basis. Lease liabilities include the net present
value of the following lease payments:

•

•
•

•

Fixed payments (including in-substance fixed payments),
less any lease incentives receivable;
Variable lease payment that are based on an index or a rate;
Amounts expected to be payable by the lessee under
residual value guarantees;
The exercise price of a purchase option if the lessee is
reasonably certain to exercise that option;
Payments of penalties for terminating the lease, if the lease
term reflects the lessee exercising that option; and
The lease payments are discounted using the interest rate
implicit in the lease. If that rate cannot be determined, the
incremental borrowing rate is used.

Right-of-use assets are measured at cost comprising the
following:

•
•

The amount of the initial measurement of lease liability;
Any lease payments made at or before the commencement
date less any lease incentives received;
Any initial direct costs; and
Restoration costs.

Payments associated with short-term leases and leases of
low-value assets are recognised as an expense in profit or loss.
Short-term leases are leases with a lease term of twelve months
or less.

Treatment of lease agreements recognised in the
rehabilitation provision

Lease payments have been contemplated in the rehabilitation
provision. However, once a lease for equipment to be used in
rehabilitation activities is entered into a separate lease liability
and right-of-use asset is recognised. The rehabilitation obligation
is not extinguished by entering into a lease, instead, the
rehabilitation obligation is extinguished over time as the leased
asset is put to use in executing the rehabilitation program.

Lease payments are allocated to the lease liability, with the
interest component allocated to financing cost in the Statement
of Comprehensive Income.

Where the right-of-use asset resulting from the lease arrangement
is to be used exclusively for rehabilitation, it represents an
economic resource which will have a future use in the completion
of rehabilitation activity. As such the right-of-use asset is not
impaired as is the case for other non-lease Ranger Cash
Generating Unit (CGU) assets.

When the right-of-use asset is depreciated, the depreciation
charge is allocated to the rehabilitation provision to reduce the
outstanding amount provided for in the rehabilitation provision.

(m) Exploration and evaluation expenditure
Exploration and evaluation expenditure comprises costs which
are directly attributable to:

•
•

•

Researching and analysing existing exploration data;
Conducting geological studies, exploratory drilling and
sampling;
Construction of underground tunnels, where necessary for
exploration drilling;
Examining and testing extraction and treatment methods;
and
Compiling prefeasibility and feasibility studies.

Exploration and evaluation expenditure also includes the costs
incurred in acquiring mineral rights, the entry premiums paid to
gain access to areas of interest and amounts payable to third
parties to acquire interests in existing projects.

Capitalisation of exploration expenditure commences when
there is a high degree of confidence in the projects viability and
hence it is probable that future economic benefits will flow to the
Company. Capitalised exploration expenditure is reviewed for
impairment indicators at each balance sheet date.

Exploration and evaluation assets are tested for impairment when
any of the following facts and circumstances exist:

•

The term of exploration licence in the specific area of
interest has expired during the reporting period or will expire
in the near future, and is not expected to be renewed;
Substantive expenditure on further exploration and
evaluation of mineral resources in the specific area are not
budgeted or planned;
Exploration for and evaluation of mineral resources in the
specific area have not led to the discovery of commercially
viable quantities of mineral resource and the decision was
made to discontinue such activities in the specific area; or
Sufficient data exists to indicate that, although development
in the specific area of interest is likely to proceed, the
carrying amount of the exploration and evaluation asset is
unlikely to be recovered in full from successful development
or by sale.

Subsequent recovery of the resulting carrying value depends
on successful development of the area of interest or sale of the
project. If a project does not prove viable, all unrecoverable costs
associated with the project and the related impairment provisions
are written off. Any impairment provisions raised in previous
years are reassessed if there is a change in circumstances,
which indicates that they should be reviewed; for example, if it is
decided to proceed with development. If the project proceeds to
development the amounts included within intangible assets are
transferred to property, plant and equipment.

(i) Undeveloped properties

Undeveloped properties are mineral concessions where the
intention is to develop and go into production in due course.
The carrying values of these assets are reviewed annually by
management and the results of these reviews are reported to the
Board and Audit and Risk Committee. For accounting purposes,
the company reviews for evidence of impairment indicators

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

at each reporting date and, where identified, the recoverable
amount is estimated.

(n) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount
of associated GST, unless the GST incurred is not recoverable
from the taxation authority. In this case it is recognised as part of
the cost of acquisition of the asset, or as part of the expense.

Receivables and payables are stated inclusive of the amount of
GST receivable or payable. The net amount of GST recoverable
from, or payable to, the taxation authority is included with other
receivables or payables in the balance sheet. Cash flows are
presented on a gross basis. The GST components of cash
flows arising from investing or financing activities which are
recoverable from, or payable to the taxation authority, are
presented as operating cash flows.

(o) Trade and other payables
Liabilities are recognised for amounts to be paid in the future for
goods and services received prior to the end of the financial year,
whether or not billed to the Company. Trade accounts payable
are normally settled within 60 days. These are recognised initially
at their fair value and subsequently measured at amortised cost
using the effective interest rate method.

(p) Provisions
Provisions are recognised when the Company has a present
legal or constructive obligation as a result of past events, it is
probable that an outflow of resources will be required to settle
the obligation and the amount has been reliably estimated.
Provisions are not recognised for future operating losses.

Provisions are measured at the present value of management’s
best estimate of the expenditure, adjusted for risk, required
to settle the present obligation at the balance sheet date. The
discount rate used to determine the present value reflects current
market assessments of the time value of money. The increase in
the provision due to the passage of time is recognised as interest
expense.

(i) Rehabilitation

The Company is required to rehabilitate the Ranger Project Area
upon cessation of mining operations. The costs are estimated on
the basis of a closure plan, taking into consideration the technical
closure options available to meet the Company’s obligations.
The cost estimates are calculated annually during the life of
the operation to reflect known developments and are subject to
regular reviews.

The amortisation or unwinding of the discount applied in
establishing the net present value of provisions is charged to the
statement of comprehensive income in each accounting period.
The amortisation of the discount is shown as a financing cost.
Other movements in the provision for closure and restoration
costs, including those resulting from new disturbance, updated
cost estimates, changes to lives of operations and revisions to
discount rates are capitalised within fixed assets, unless the
assets that they relate to are fully written down or impaired - in
which case the movement in the provision is allocated directly to

the statement of comprehensive income. These capitalised costs
are then depreciated on a unit of production basis over the life of
the reserves.

Where rehabilitation is conducted systematically over the life
of the operation, rather than at the time of closure, provision is
made for the outstanding continuous rehabilitation work at each
balance date. All costs of continuous rehabilitation work are
charged to the provision as incurred.

Costs are allowed for in the closure provision when they are
directly related to rehabilitation of the Ranger Project Area. Costs
incurred to operate and manage the site whilst uranium oxide
production was occurring were allocated to operating costs. The
operation of the Brine Concentrator, pond water management
and power station are costs that were allocated to operating
costs up until production of uranium oxide ceased (8 January
2021). Following cessation of uranium oxide production these
costs are allocated to the closure provision. Costs associated
with non-rehabilitation corporate activities remain in operating
costs and so are not provided for.

Separately, the Company is required to maintain with the
Commonwealth Government the Ranger Rehabilitation Trust
Fund (Trust Fund), to provide security against the estimated
costs of closing and rehabilitating the mine immediately (rather
than upon the planned cessation of mining operations). Each
year, the Company is required to prepare and submit to the
Commonwealth Government an Annual Plan of Rehabilitation
(APR). The current APR 44 was finalised in February 2020. Once
accepted by the Commonwealth Government, the annual plan is
then independently assessed and costed and the amount to be
provided by the Company in the Trust Fund, is then determined.
The Trust Fund includes both cash and financial guarantees. The
cash portion is shown as a government security receivable on the
balance sheet (Note 10), and interest received by the Trust Fund
is shown as interest income. The balance of bank guarantee is
shown at Note 10.

Government security receivable balances are split between
current and non-current assets based on management’s estimate
as to when cash will be received from the Commonwealth
Government.

The Company is required to rehabilitate the Jabiluka Mineral
Lease upon cessation of operations to a standard specified by
the Authorisation to operate issued by the Northern Territory
Government. The estimated cost of rehabilitation is currently
secured by a bank guarantee.

(q) Employee entitlements

(i) Wages and salaries, annual leave and sick leave

The liability for employee entitlements to wages and salaries
represents the amount which the Company has a present
obligation to pay, resulting from employees’ services provided
up to the reporting date. A provision exists for annual leave and
accumulating sick leave as it is earned by employees and is
measured at the amount expected to be paid when it is settled
and includes all related on costs. Liabilities for non-accumulating
sick leave are recognised when the leave is taken and measured
at the rates paid or payable.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

(ii) Long service leave

The liability for long service leave expected to be settled within
12 months of the reporting date is recognised in the provision
of employee benefits and is measured in accordance with (i)
above. The liability for long service leave expected to be settled
more than 12 months from the reporting date is measured as
the present value of expected future payments to be made in
respect of services provided by employees up to the reporting
date. Consideration is given to the expected future wage and
salary levels, experience of employee departures and periods
of service.

Expected future payments are discounted using the rates attaching
to Commonwealth Government securities at the reporting
date, which most closely match the terms of maturity of the
related liabilities.

(iii) Superannuation plan

Employees of the Company are entitled to benefits on retirement,
disability or death from their membership of the Rio Tinto Staff
Superannuation Fund (“The Fund”). The Fund has both a defined
benefit and a defined contribution section. Contributions to the
defined contribution superannuation plans are expensed in the
income statement when incurred.

The Company has no staff who are members of the defined
benefits section.

(iv) Termination benefits

Termination benefits are payable when employment is terminated
before the normal retirement date, or when an employee
accepts voluntary redundancy in exchange for these benefits.
The Company recognises termination benefits when it is
demonstrably committed to either terminating the employment
of current employees according to a detailed formal plan without
possibility of withdrawal or to providing termination benefits as a
result of an offer made to encourage voluntary redundancy.

(r) Segment reporting
Management has determined the operating segments based
on the reports reviewed by the Chief Executive, used to make
strategic decisions. The Chief Executive considers the business
from a product perspective.

(s) Cash and cash equivalents
For the purposes of the statement of cash flows, cash includes
cash on hand and deposits held at call, net of any bank
overdrafts.

Cash instruments that qualify as cash equivalents have an
original maturity date no greater than 3 months.

(t) Contributed equity
Ordinary shares are classified as equity.

Incremental costs directly attributable to the issue of new shares
or options are shown in equity as a deduction, net of tax, from
the proceeds. Incremental costs directly attributable to the issue
of new shares or options for the acquisition of a business are

not included in the cost of the acquisition as part of the purchase
consideration.

(u) Earnings per share

(i) Basic earnings per share

Basic earnings per share is determined by dividing net profit after
income tax attributable to members of the Company, excluding
any costs of servicing equity other than ordinary shares, by the
weighted average number of ordinary shares outstanding during
the financial year, adjusted for bonus elements in ordinary shares
issued during the year.

(ii) Diluted earnings per share

Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into account
the after income tax effect of interest and other financing costs
associated with dilutive potential ordinary shares and the
weighted average number of shares assumed to have been
issued for no consideration in relation to dilutive potential
ordinary shares.

(v) Rounding of amounts
The Company is of a kind referred to in Class Order 2016/191,
issued by the Australian Securities and Investments Commission,
relating to the ‘rounding off’ of amounts in the financial report.
Amounts in the financial report have been ‘rounded off’ in
accordance with that Class Order to the nearest thousand
dollars, or in certain cases, to the nearest dollar.

(w) Share based payments
The fair value of cash settled share plans is recognised as a
liability over the vesting period of the awards. Movements in
that liability between accounting dates are recognised as an
expense. The grant date fair value of the awards is taken to be
the market value of the shares at the date of award. Fair values
are subsequently re-measured at each accounting date to reflect
the number of awards expected to vest based on the current
and anticipated TSR performance. If any awards are ultimately
settled in shares, the liability is transferred direct to equity as the
consideration for the equity instruments issued.

Equity settled share plans are settled either by the issue of
shares by the relevant parent Company, by the purchase of
shares on market or by the use of shares previously acquired
as part of a share buyback. The fair value of the share plans is
recognised as an expense over the expected vesting period with
a corresponding entry to other reserves.

If the cost of shares acquired to satisfy the plans exceeds
the expense charged, the excess is taken to the appropriate
reserve. The fair value of the share plans is determined at the
date of grant, taking into account any market based vesting
conditions attached to the award (e.g. TSR). The Company
uses fair values provided by independent actuaries calculated
using a lattice based option valuation model. Non-market based
vesting conditions (e.g. earnings per share targets) are taken into
account in estimating the number of awards likely to vest.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

The estimate of the number of awards likely to vest is reviewed
at each balance sheet date up to the vesting date, at which point
the estimate is adjusted to reflect the actual awards issued. No
adjustment is made after the vesting date even if the awards are
forfeited or not exercised.

Further information about the treatment of individual share based
payment plans is provided in Note 33.

(ii)

$1.6 billion and $2.2 billion (undiscounted nominal terms).
The previously announced closure estimate, which was
based on the Ranger Project Area closure Feasibility
Study finalised in 2019 (“Feasibility Study”), was $973
million (undiscounted nominal terms); and

The revised date for completing the Ranger Project Area
rehabilitation is forecast to be between Quarter 4, 2027
and Quarter 4, 2028.

(x) Standards issued but not yet effective
A number of new standards are effective for annual periods
beginning after 1 January 2022 and earlier application is permitted.
However, the Company has not adopted the new or amended
standards in preparing these financial statements. Management
has also concluded that when those new standards become
applicable and are adopted there will be anticipated material
impact to the balances and transactions of the Company.

Critical accounting estimates
and judgements

Estimates and judgements are continually evaluated and are
based on historical experience and other factors, including
expectations of future events that may have a financial impact on
the Company and that are believed to be reasonable under the
circumstances.

The Company makes estimates and assumptions concerning
the future. The resulting accounting estimates will, by definition,
seldom equal the related actual results. The 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.

(a) Rehabilitation provision
The calculation of the rehabilitation provision relies on estimates
of costs and their timing to rehabilitate and restore disturbed
land to establish an environment similar to the adjacent Kakadu
National Park in line with the Company’s statutory obligations.

The costs are estimated on the basis of a closure plan,
taking into account considerations of the technical closure
options available to meet ERA’s obligations. The provision for
rehabilitation represents the net present cost at 31 December
2021 of the preferred plan and represents managements best
estimate of cost.

In July 2021, ERA commenced a major reforecast of cost and
schedule. This followed on from the 2019 Feasibility Study
which expanded on the earlier prefeasibility study completed in
2011. The reforecast has continued into early 2022, including an
external evaluation of the preliminary findings. The preliminary
findings by ERA from its reforecast exercise based on the Ranger
rehabilitation project being completed in accordance with the
methodology set out in the current Mine Closure Plan indicates
that:

(i)

The revised total cost of completing the Ranger Project
Area rehabilitation, including incurred spend from 1
January 2019, is forecast to be approximately between

ERA notes that the above revised estimates, as to both cost and
schedule, are based on the Ranger rehabilitation project being
completed in accordance with the methodology set out in the
current Mine Closure Plan.

In determining the provision, ERA has considered the preliminary
findings from the reforecast as well as potential optimisation of
the Pit 3 capping strategy. Further work on the reforecast and
alterations to the Pit 3 capping strategy are ongoing.

The reforecast estimate is prepared in nominal terms, it has
then been adjusted to real terms by removing the impacts of
inflation. This has then been discounted at 1.5% to give a
closure provision. The estimated closure provision at
31 December 2021, excluding unrecognised employee
termination benefits and an allowance of $1 million for
Jabiluka rehabilitation is $1,250 million.

This has resulted in an increase to the provision of $668 million
that has been recorded in the Statement of Comprehensive
Income.

Key packages of work completed since 2012 include preliminary
Pit 3 backfill, Pit 1 capping including design and backfill,
completion of bulk dredging works at the Tailings Storage Facility
(TSF) and construction of water treatment infrastructure including
the brine concentrator, high density sludge (HDS) plant and brine
squeezer.

Major activities to complete the rehabilitation plan include
bulk material movements, water treatment, demolition and
revegetation. Major cost sensitivities include Pit 3 capping,
material movements and water treatment.

The ultimate cost of rehabilitation is uncertain and can vary
in response to many factors including legal requirements,
technological change, weather events and market conditions. It is
reasonably possible that outcomes from within the next financial
year that are different from the current cost estimate could
require material adjustment to the rehabilitation provision for the
Ranger Project Area.

Selected risks for the Ranger rehabilitation provision are detailed
below.

Tailings consolidation

Bulk dredging works at the Tailings Storage Facility (TSF)
were completed in February 2021, with works then shifting
to progressing floor and wall cleaning activities which were
subsequently completed in late 2021. This process has been
more complex and time consuming than planned resulting in
adverse impacts to cost and schedule of Pit 3 capping.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

During the final capping process the tailings in Pit 3 will
consolidate and express process water, which will need to be
collected and treated. The consolidation process will be aided by
installing vertical wicks and the knowledge of the consolidation
timeframes is backed up by a detailed model based on in situ
testing of site tailings. The consolidation model predictions of
rates of process water expression is impacted by many factors,
including tailings density and other characteristics, deposition
method and free process water volume in the pit during
deposition.

additional items that the estimate could be impacted by,
including: evaporation rates, stakeholder requirements, higher
costs of refurbishing Jabiru township housing, engineering
studies, other site contaminants, plant mortality and project
support costs.

In estimating the rehabilitation provision ERA has prepared its
best estimate of costs and schedule, taking into consideration the
risk factors identified above.

Cash flow timing

These impacts have been considered in the reforecast, but to
the extent tailings consolidation and process water expression
extend further could have additional adverse impacts on cost and
schedule of completing rehabilitation.

The company estimates the presentation of its rehabilitation
provision between current and non-current liabilities, based
on anticipated timing of expenditure from updated cash flow
forecasts.

Process water

(b) Taxation

Projects continue to progress in order to increase process
water treatment capacity, including the completion of the brine
concentrator expansion project.

Treatment of process water is critical to completing rehabilitation.
As previously noted, the Feasibility Study and reforecast
assumed a long-term average annual rainfall for the region in
forecasting future water treatment requirements. Annual rainfall
can vary from year to year. Historically, the region has seen
higher than average rainfall in periods of ‘La Nina’ and this
continued in 2020/21 with higher than average rainfall recorded.

Overall, process water volumes are sensitive to many factors.
Any additional water would require treating through ERA’s
process water treatment infrastructure, in large part the brine
concentrator. Water volumes can vary due to:

• Additional rainfall above an average wet season;

• The performance of water treatment plants, including new

smaller scale plants that have recently come online;

• The timing of closure of which water catchments occurs; and

• The volume and timing of water expressed from tailings.

Process Water salt disposal

As a result of treating process water a waste stream of
contaminated salt is generated. The salt is ultimately to be
stored below tailings in Pit 3 via injecting the brine through bore
holes. Recommissioning activities for this infrastructure have
successfully occurred although the long term performance is
yet to be fully confirmed. Should the disposal of salt in this
manner not prove viable an alternate method of salt disposal
would be required. This could require significant additional
capital expenditure, which has not been allowed for in either the
schedule or cost estimate and may not be available to ERA.

Bulk material movement

Pit 3 bulk material movements are sensitive to the volume of
material which is to be moved and the schedule of movement.

Other factors

In addition to the factors identified above there are many

ERA has approximately $225 million tax losses (at 30 per cent)
that are not recognised as deferred tax assets due to uncertainty
regarding ERA’s ability to generate adequate levels of future
taxable profits. This treatment is reviewed at each reporting
date. Should future taxable profits eventuate this treatment will
not impact ERA’s ability to utilise available tax losses in future
periods.

Judgement is required in regard to the application of income tax
legislation. There is an inherent risk and uncertainty in applying
these judgements and a possibility that changes in legislation will
impact the carrying amount of deferred tax assets and deferred
tax liabilities recognised on the balance sheet.

(c) Asset carrying values
ERA has two cash generating units (CGUs); the Ranger Project
Area and the Jabiluka Mineral Lease. The Ranger CGU includes
all assets and liabilities related to activities on the Ranger
Project Area, including the rehabilitation provision. The Jabiluka
Undeveloped Property relates to the Jabiluka Mineral Lease,
which is currently under a Long Term Care and Maintenance
Agreement with Traditional Owners.

At 31 December 2021 the property, plant and equipment in
the Ranger CGU continues to be fully impaired. When capital
expenditure is incurred it is immediately expensed to the
Statement of Comprehensive Income. For the year ended
31 December 2021, $0.04 million in capital expenditure was
expensed.

At the end of each reporting period, ERA assesses whether
there are any indications that ERA’s CGUs may be impaired
or circumstances have changed to indicate reversal of prior
impairments. This requires judgement in analysing possible
impacts caused by factors such as the price of uranium oxide,
foreign exchange movements, operating and capital estimates,
discount rate, project progression and Traditional Owner
relationships.

ERA assessed the recoverable amount using a fair value less
costs of disposal (FVLCD) method. ERA conducts impairment
testing using a probability-weighted discounted cash flow model.

ENERGY RESOURCES OF AUSTRALIA LTD
notes to tHe FInAnCIAL stAtements

(d) Undeveloped Properties Judgements
Undeveloped properties are considered assets not yet ready for
use. In reporting periods where impairment testing is required,
the recoverable amount of the undeveloped properties is
determined using the fair value less costs of disposal method.
Undeveloped properties consist of the Jabiluka Mineral Lease.

The Jabiluka Mineral Lease is currently subject to a Long Term
Care and Maintenance Agreement with Traditional Owners. This
agreement ensures the Jabiluka deposit will not be developed
without the consent of the Mirarr Traditional Owners. It is
uncertain that this consent will be forthcoming and, by extension,
that the Jabiluka deposit will be developed. Should this consent
not eventuate in the future, the Jabiluka Undeveloped Property
would face full impairment.

The valuation of the Jabiluka Mineral Lease requires a high
degree of judgment. To determine the fair value, ERA uses a
probability weighted discounted cash flow model, based on
post-tax cash flows expressed in real terms, estimated until
the end of the life of mine plan and discounted using an asset-
specific post-tax real discount rate. Results are cross checked
against market valuations of other undeveloped mining projects
in the uranium industry and the broader mining sector, including
market valuations of mining assets subject to long term approval
constraints. The approach has been reviewed by an external
valuation expert.

ERA regularly reviews and updates these assumptions and
assesses potential impairment indicators and impairment reversal
indicators. In December 2021, the review did not identify any
indicators that the carrying amount of the Jabiluka Undeveloped
Property may not be recovered in full from successful
development or sale.

While some improvement in macro-economic factors has been
identified since the prior impairment, it was determined it was too
early, and significant volatility remains, to conclude whether these
would be sustained. As such, no indicators were identified that the
previously recorded impairment should be reversed. This review
primarily considered the following key factors:

• Uranium price changes based on the average of two

reputable market analysis firms on the long term uranium
oxide price and the ongoing presence of a contract price
premium;

• Long term consensus forecast Australian/US dollar exchange

rates;

• Probability and timing of development and ongoing

stakeholder relations; and

• Applicable discount rate.

The review of these factors did not identify any material changes
that would warrant a full impairment or impairment reversal review
to be conducted. As a result the carrying value of the Jabiluka
Undeveloped Property remains at $90 million.

Key assumptions to which the Jabiluka model is sensitive
include: the probability of future development (which includes an

assessment of obtaining any required approval and/or support
of various stakeholders, including the Traditional Owners,
regulatory bodies and shareholders), uranium oxide prices
(including term contract price premiums in the future), foreign
exchange rates, production and capital costs, discount rate, ore
reserves and mineral resources, lease tenure renewal (January
2024) and development delays. A change in these assumptions
may result in further impairment.

Selected downside sensitivities to the fair value of the Jabiluka
CGU at 31 December 2021 are summarised below. Based on
current assumptions, no single change in the below sensitivities
would result in further impairment, however should all occur full
impairment would result.

Sensitivity

Impact on value $million

-5 per cent change in forecast
uranium oxide price

+20 per cent change in
development capital

+5 per cent change in forecast
Australian/US dollar exchange rates

+1 per cent change in discount rate

(75)

(133)

(69)

(75)

ERA’s view remains that Jabiluka is a large, high quality uranium
ore body of global significance.

(e) Uranium Inventory net realisable value
The calculation of net realisable value is sensitive to key
assumptions including: uranium price, Australia/US dollar
exchange rate and, where applicable, costs to complete. The
sales price of uranium oxide is denominated in US dollars,
so fluctuations in the Australian/US dollar exchange rate will
affect the proceeds received from sales and consequently the
recoverable amount.

Inventories are carried at the lower of cost or net realisable value
in accordance with AASB 102.

Where necessary the net realisable value adjustments are
included in ‘Changes in inventories’ in the statement of
comprehensive income.

(f) Employee Benefits Judgements
Following the cessation of processing on the Ranger Project
Area on 8 January 2021 and ERA’s transition to closure phase
there has been a significant reduction in the Company workforce,
triggering certain Termination Benefits. The total provision
recognised in line with Australian Accounting Standards is
$0.9 million and is based on updated workforce requirements
gathered as part of the major rehabilitation forecast. This is a
current liability based on the balance being payable within one
year.

Potential termination payments beyond 2022 are yet to be
recognised due to the level of uncertainty regarding quantum
and timing.

ENERGY RESOURCES OF AUSTRALIA LTD

notes to tHe FInAnCIAL stAtements

3 Revenue

REVENUE FROM CONTINUING OPERATIONS

Sale of goods

Rendering of services

Total sales revenue

Other revenue

Interest received/receivable, other parties

Rent received

Contract compensation (uranium oxide)

Asset sales and recoveries

Net gain on non-hedge forward contracts

Net revenue foreign exchange gain / (loss)

Total other revenue

Total revenue from continuing operations

Expenses

PROFIT BEFORE INCOME TAX INCLUDES
THE FOLLOWING SPECIFIC EXPENSES:

Cost of sales

Third party produced product U308

Produced product (uranium oxide)

Total cost of sales

Government and other royalties

Royalty payments

Payments to Indigenous interests

Total government and other royalties

Financing costs

Other parties

Unwinding of discount (rehabilitation provision)

Total financing costs

Other expenses

Property, plant and equipment expensed

Office and other expenses

Total other expenses

2021
$’000

2020
$’000

190,347

242,222

235

190,347

242,457

1,942

862

407

7,449

5,582

857

1,922

3,962

109

10,660

12,434

201,007

254,891

NOTES

2021
$’000

2020
$’000

120,830

971

164,095

165,066

2,248

7,643

9,981

732

18,797

19,529

581

624

2,845

9,672

12,517

1,052

23,897

24,949

193

268

461

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Other individually significant expenses

Short term and low value leases

Interest expense related to leases

Sustainability payment to Indigenous interests

Defined contribution superannuation expense

Income tax expense/(benefit)

INCOME TAX EXPENSE/(BENEFIT)

Current tax

Deferred tax

Income tax expense/(benefit)

Deferred income tax (revenue)/expense included in income tax expense comprises:

Decrease/(increase) in deferred tax assets (Note 21B)

(Decrease)/increase in deferred tax liabilities (Note 21A)

Deferred tax

RECONCILIATION OF INCOME TAX EXPENSE TO PRIMA FACIE TAX PAYABLE

Operating profit before income tax

Tax at the Australian tax rate of 30% (2020: 30%)

Tax effect of amounts which are not deductible/(taxable) in calculating taxable income:

Derecognition of deferred tax assets

Rehabilitation expenditure

Other items

Income tax expense/(benefit)

No deferred tax asset is recognised due to uncertainty over ERA’s ability to generate future taxable profits.

Dividends

Dividends paid or declared
No dividends have been paid or declared for the year ended 31 December 2021 (2020: nil).

Dividends franking account

Franking credits available for subsequent financial years
based on a tax rate of 30% (2020: 30%)

2021
$’000

2,108

506

2020
$’000

137

2,094

4,009

2021
$’000

2020
$’000

2,817

(2,817)

2,817

(2,817)

564

(564)

(647,395)

(194,219)

1,353

(1,353)

8,643

2,593

216,328

4,373

(18,897)

(10,301)

(395)

2,817

518

(2,817)

2021
$’000

2020
$’000

234,095

The above amounts represent the balance of the franking account as at the end of the financial year, adjusted for franking credits that
will arise from the payment of the amount of the provision for income tax as applicable.

The ability to utilise the franking account credits is dependent upon there being sufficient available profits to declare dividends.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Cash and cash equivalents

CURRENT

Cash at bank and in hand

Deposits at call

Cash and cash equivalents

2021
$’000

2020
$’000

55,658

108,214

163,872

15,588

188,762

204,350

Cash at bank/Deposits at call
Cash assets and deposits bear floating interest rates between 0 per cent and 0.46 per cent (2020: 0.0 per cent and 1.74 per cent).

Interest rate risk exposure
The Company’s exposure to interest rate risk is discussed in Note 31.

Trade and other receivables

CURRENT

Trade debtors

Amounts due from related parties

Other debtors

Trade and other receivables

2021
$’000

2020
$’000

2,045

27,017

4,313

33,375

3,219

2,187

2,382

7,788

Impairment of receivables
No trade receivables are past due. There is no impairment of trade receivables.

Other debtors relate to transactions outside the usual operating activities of the Company and are predominately concerned with
receipts from employees and businesses operating within the Jabiru township. These ongoing activities are expected to be settled
during the 12 months subsequent to balance date.

Foreign exchange and interest rate risk
The Company operates internationally, but is primarily exposed to foreign exchange risk arising from currency exposures with respect
to the US dollar.

A summarised analysis of the sensitivity of trade and other receivables to foreign exchange and interest rate risk can be found in
Note 31.

Fair value and credit risk
Due to the short-term nature of trade and other receivables their carrying amount approximates their fair value.

The maximum exposure to credit risk at the reporting date is the carrying amount of each class of receivables mentioned above.

The Company does not hold any collateral as security. Refer to Note 31 for more information on the financial risk management policy
of the Company.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Inventories – current

Stores and spares

Work in progress at cost

Finished product U3O8 at cost

Total current inventory

2021
$’000

7,089

2020
$’000

5,931

776

22,524

125,997

29,613

132,704

Inventory expense
Obsolescence of inventory (stores and spares) provided for and recognised as an expense during the year ended 31 December 2021
amounted to $715,422 (2020: $5,346,529). This amount has been included in Materials and Consumables used within the Statement
of Comprehensive Income.

10 Government security receivable

CURRENT

Government security receivable

2021
$’000

2020
$’000

65,400

123,316

Each year, ERA is required to prepare and submit to the Commonwealth Government an Annual Plan of Rehabilitation. Once
accepted by the Commonwealth Government, the Annual Plan is then independently assessed and costed and the amount to be
provided by ERA into the Ranger Rehabilitation Trust Fund (Trust Fund) is then determined. The Trust Fund includes both cash and
financial guarantees.

The Commonwealth Government finalised its review in February 2020, the Commonwealth Government confirmed a revised security
amount of $655 million. In order to meet its statutory obligation, ERA contributed $454 million from the Entitlement Offer proceeds
during the period, adding to balances held in the prior period of $77 million, with a total of $531 million as cash held on deposit with
the Department of Industry, Science, Energy and Resources (DISER) and $125 million in bank guarantees.

The cash held as security is invested in term deposits to optimise returns whilst providing appropriate security. This is disclosed as a
government security receivable in the Balance Sheet.

ERA’s ability to continue to access financial guarantees can be influenced by many factors, including future cash balance, cash flows
and shareholder support. Issuers of the bank guarantees have certain pay and walk rights and the guarantees are subject to periodic
reviews. Should the banks execute their pay and walk rights or ERA is unable to access bank guarantees, substantial additional cash
would be required to indemnify the banks or be deposited into the Trust Fund.

The 45th Annual Plan of Rehabilitation is currently being undertaken to align with the conclusion of processing on 8 January 2021 and
consider impacts identified through the rehabilitation reforecast process. This review may revise the determined security position.

As rehabilitation progresses the security requirement is expected to decrease largely in line with the annual rehabilitation spend
and cash and/or bank guarantees will be withdrawn from the Trust Fund. Drawdown is subject to approval by the Commonwealth
Government, consequently there remains a risk to the Company’s liquidity and financial position should the Trust Fund security value
not reduce broadly in line with the Company’s forecast rehabilitation spend.

It is estimated that a portion of the government security receivable will be returned to the Company within the next 12 months.
In determining the resulting portion that is held as a current asset, the Company has determined it appropriate to consider that
completed packages of work will be refunded to the company to the extent they were allowed for in the APR. This portion has been
recorded as a current asset.

Cash flows to/from the fund are considered to be advances to/from a third party and therefore disclosed under Investing Activities.

The applicable weighted average interest rate for the year ended 31 December 2021 was 0.30 percent (2020: 0.85 per cent).

ENERGY RESOURCES OF AUSTRALIA LTD
notes to tHe FInAnCIAL stAtements

11 Derivative financial instruments

FINANCIAL ASSETS - CURRENT

Forward exchange contracts (designated hedge)

Gasoil swap contracts (non designated hedge)

Total current financial assets

Forward foreign exchange contracts

2021
$’000

2020
$’000

3,451

9,391

3,032

12,423

The forward exchange contracts have been designated and are effective as a hedging instrument.

The forward exchange contracts are measured at fair value on a recurring basis using a Discounted Cash Flows methodology. The
contracts are valued using market quoted forward exchange rates as inputs and, when material, discounted based on applicable yield
curves derived from market quoted interest rates.

The Company did not have any sources of hedge ineffectiveness emerging in designated relationships.

Gasoil swap contracts

The Gasoil swaps have been measured at fair value, with the resulting gains recorded in the profit and loss.

The Gasoil swap contracts are measured at fair value on a recurring basis using a Discounted Cash Flows methodology. The
contracts are valued, using market quoted forward exchange rates as inputs and when material discounted based on applicable yield
curves derived from market quoted interest rates.

Gasoil swap contracts will mature as follows and are recorded as a non-current asset when maturity is greater than 1 year. The
following table details ERA’s liquidity analysis for its derivative financial instruments based on contractual maturities. The table has
been drawn up based on the undiscounted cash flows. Settlement of the Gas Oil swap contracts occur on a net cash flow basis,
based on the spot price at settlement.

Buy Gasoil

Less than 1 year (US$)

Less than 1 year (A$)

Greater then 1 year less than 2 years

Notional ($ million)

US$1.9

A$4.7

$ per barrel

US$51.75

A$89.00

At 31 December 2021, had the Gasoil forward price weakened/strengthened by 10 per cent with all other variables held constant. The
change in financial assets would have affected pre tax profit for the half year by $1.1 million.

12 Other assets

Prepayments

2021
$’000

829

2020
$’000

2,030

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Inventories – non-current

Finished product U3O8 at cost

14 Undeveloped properties

Jabiluka: Long-term care and maintenance development project

Balance brought forward

Amount capitalised during the year

Non-cash impairment change

Total undeveloped properties

2021
$’000

2020
$’000

15,423

2021
$’000

2020
$’000

89,856

Undeveloped properties are considered an asset not yet ready for use. In reporting periods where impairment testing is required, the
recoverable amount of undeveloped properties is determined using the fair value, less costs of disposal method.

Fair value, less costs of disposal is determined using a discounted cash flow model. In 2021 no impairment test was required as
a trigger assessment did not identify any indicators that the carrying amount of the Jabiluka Undeveloped Property may not be
recoverable in full from successful development or sale. Key assumptions the fair value is most sensitive to include:

Uranium prices;
Foreign exchange rates;
Production and capital costs;
Discount rate;

•
•
•
•
• Ore Reserves and Mineral Resources; and
•

Probability and timing of future development and ongoing stakeholder relations.

The recoverable amount is dependent on the development and life of the ore body together with the term and continuity of the mining
lease. It reflects expected future cashflows contained in the long term asset plan with an adjustment of cashflows expected to take
into account project development risk. The Company has projected cashflows for the period of the current mining lease, together with
a ten year renewal period.

Further details can be found in Note 2(d).

The Jabiluka Mineral Lease is currently subject to Long Term Care and Maintenance Agreement with Traditional Owners. This
agreement ensures the Jabiluka deposit will not be developed without the consent of the Mirarr Traditional Owners. It is uncertain that
this consent will be forthcoming and, by extension, that the Jabiluka deposit will be developed. Should this consent not eventuate in
the future the Jabiluka Undeveloped Property would face full impairment.

The discount rate applied to the future cash flow forecasts represents an estimate of the rate the market would apply, having regard to
the time value of money and the risks specific to the asset for which the future cash flow estimates have not been adjusted.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

15 Property, plant and equipment

MINE LAND AND
BUILDINGS
$’000

PLANT AND
EQUIPMENT
$’000

MINE
PROPERTIES
$’000

REHAB-
ILITATION
$’000

RIGHT OF
USE ASSETS
$’000

TOTAL
$’000

YEAR ENDED 31 DECEMBER
2021

Opening net book amount

Additions

Disposals

Change in lease term

Depreciation charged to
rehabilitation provision

Depreciation/amortisation charge/
write-offs

Additions immediately impaired

Closing net book amount

(43)

1,756

(83)

(1,227)

(354)

(43)

Cost

110,845

1,179,583

421,700

342,327

5,183

2,059,638

Accumulated depreciation/
amortisation/impairment/write-offs

Net book amount

YEAR ENDED 31 DECEMBER
2020

Opening net book amount

Additions

Disposals

Depreciation charged to
rehabilitation provision

Depreciation/amortisation charge/
write-offs

Additions immediately impaired

Closing net book amount

(110,845)

(1,179,583)

(421,700)

(342,327)

(5,091)

(2,059,546)

193

(193)

4,213

193

(2,104)

(353)

1,756

5,266

(353)

(193)

1,756

2,059,678

Cost

110,845

1,179,540

421,700

342,327

Accumulated depreciation/
amortisation/impairment/write-offs

(110,845)

(1,179,540)

(421,700)

(342,327)

(3,510)

(2,057,922)

Net book amount

1,756

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Right of use assets
Right of use assets include building costs of $528,000. Right of use to equipment used for rehabilitation of $1,228,000 ceased in
2021.

Assets under construction
There were no property, plant and equipment assets used in the course of construction.

16 Derivative financial instruments

FINANCIAL ASSETS - NON CURRENT

Gasoil swap contracts

Total non-current financial assets

17 Government security receivable

NON-CURRENT

Government security receivable

Further details are provided in Note 10.

18 Trade and other payables

CURRENT

Trade payables

Amounts due to related parties

Other payables

Total trade and other payables

19 Provisions – current

CURRENT

Employee benefits

Rehabilitation

Total current provisions

2021
$’000

2020
$’000

580

2021
$’000

2020
$’000

469,442

409,927

2021
$’000

2020
$’000

34,331

2,074

398

34,144

4,309

837

36,803

39,290

2021
$’000

2020
$’000

9,834

25,471

222,898

162,928

232,732

188,399

Employee benefits provision
During 2021 a provision for benefits payable on termination of employment continued to be recognised. A total of $0.9 million was
recognised as payable in 2022 and has been recognised as a current liability. Further details are in Note 2(f). The remaining employer
benefits relate to annual leave and long service leave. Entitlements currently payable are classified as current provisions and
entitlements due in greater than 12 months are classified as non-current provisions.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Movements in rehabilitation provision
Movements in the rehabilitation provision during the financial year are set out below:

2021

Carrying amount at the start of the year

Payments

Utilisation of lease assets

Transfer from non-current provision

Carrying amount at the end of the year

2020

Carrying amount at the start of the year

Payments

Utilisation of lease assets

Transfer from non-current provision

Carrying amount at the end of the year

20 Provisions – non-current

NON-CURRENT

Employee benefits (Note 19)

Rehabilitation

Carrying amount at the end of the year

REHABILITATION
$’000

162,928

(153,149)

(1,227)

214,346

222,898

REHABILITATION
$’000

123,495

(80,190)

(2,104)

121,727

162,928

2021
$’000

2020
$’000

753

1,027,971

1,028,724

745

555,371

556,116

Movements in rehabilitation provision
As a result of the Ranger Cash Generating Unit being fully impaired in 2016 and the cessation of uranium production in January
2021, the 2021 changes in rehabilitation estimates were allocated directly to the Statement of Comprehensive Income. Movements
in the rehabilitation provision during the financial year are set out below:

2021

Carrying amount at the start of the year

Change in estimate

Change in discount rate

Unwinding of discount

Transfer to current provision

Carrying amount at the end of the year

REHABILITATION
$’000

555,371

668,149

18,797

(214,346)

1,027,971

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

2020

Carrying amount at the start of the year

Change in estimate

Change in discount rate

Unwinding of discount

Transfer to current provision

Carrying amount at the end of the year

21 Deferred tax liability

(A) DEFERRED TAX LIABILITY

The balance comprises temporary differences attributable to:

Amounts recognised in profit and loss

Government security receivable

Inventories

Receivables

Total deferred tax liabilities

Set-off of deferred tax asset pursuant to set-off provisions (Note 21B)

Net deferred tax liabilities

Movements

Opening balance at 1 January

(Credited)/debited to the income statement (Note 5)

Closing balance at 31 December

(B) DEFERRED TAX ASSETS

The balance comprises temporary differences attributable to:

Amounts recognised in profit and loss

Rehabilitation provision

Employee provisions

Other

Total deferred tax assets

Set-off of deferred tax liabilities pursuant to set-off provisions (Note 21A)

Net deferred tax assets

Movements

Opening balance at 1 January

Credit/(debited) to the income statement (Note 5)

Closing balance at 31 December

REHABILITATION
$’000

646,672

(2,572)

9,101

23,897

(121,727)

555,371

2021
$’000

2020
$’000

23,022

1,851

351

2,354

412

25,224

25,788

(25,224)

(25,788)

25,788

(564)

25,224

27,141

(1,353)

25,788

16,148

11,152

3,166

5,910

9,078

5,558

25,224

25,788

(25,244)

(25,788)

25,788

(564)

25,224

27,141

(1,353)

25,788

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

22 Share capital

SHARE CAPITAL

A Class shares fully paid

Total contributed equity

2021
SHARES

2020
SHARES

2021
$’000

2020
$’000

3,691,383,198

1,177,656

Movements

A Class shares fully paid

Share capital at the start of the year

Shares issued during the year (at $0.15 per share)

Share capital at the end of the financial year

Total contributed equity

Contributed equity at the start of the year

Additional contribution of equity ($0.15 per share for 3,173,658,137 shares)

Share issuance costs

Contributed equity at the end of the year

2021
’000

2020
’000

3,691,383

1,177,656

517,725

3,173,658

3,691,383

706,485

476,049

(4,878)

1,177,656

As announced on 20 February 2020, ERA’s fully underwritten 6.13 for 1 pro rata renounceable entitlement offer of new fully paid
shares to raise approximately $476 million closed successfully in February 2020. The proceeds, to be used primarily to fund ERA’s
statutory rehabilitation obligations for the Ranger Project Area, have been invested in short duration term deposits across a variety
of Australian deposit taking institutions.

Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the
number of shares held.

On a show of hands every holder of ordinary shares present at a shareholders’ meeting in person or by proxy, is entitled to one
vote, and upon a poll each share is entitled to one vote.

Capital risk management
Details of the Company’s exposure to risks when managing capital are set out in Note 31.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

23 Reserves and retained profits

RESERVES

Share-based payments reserve

Capital reconstruction

Cashflow hedge reserve

Total reserves

Movements

Share-based payments reserve

Balance 1 January

Share-based payments expense / (reversal)

Balance 31 December

Capital reconstruction

Balance 1 January

Movements

Balance 31 December

Cashflow hedge reserve

Balance at 1 January

Unsettled change in fair value (before tax)

Tax on unsettled change in fair value

Gain on changes in fair value of settled hedges

Gain on changes in fair value reclassified to profit or loss

Balance 31 December

ACCUMULATED LOSSES

Movements in accumulated losses were as follows:

Opening accumulated losses – 1 January

Net profit (loss) for the year

Closing accumulated losses – 31 December

Nature and purpose of reserves

2021
$’000

2020
$’000

(906)

(691)

389,500

6,574

388,594

395,383

(691)

(215)

(906)

(752)

(691)

389,500

6,574

(9,391)

2,817

9,561

(9,561)

9,391

(2,817)

4,707

(4,707)

6,574

(1,358,460)

(1,369,920)

(650,212)

11,460

(2,008,672)

(1,358,460)

Share based payments reserve
Share based payments reserve is used to recognise the fair value of equity instruments issued to employees but not exercised.

Capital reconstruction reserve
In June 1995, the Company reduced its share capital by cancelling $0.95 of the capital paid up on each issued share and reducing
the par value of each issued share from $1.00 to $0.05. The cancelled capital (comprising $389,500,000 in total) was credited to a
Capital Reconstruction Reserve. The Company has the ability to distribute capital to shareholders from this reserve.

Cashflow hedge reserve
The nature of the Cashflow hedge reserve is described in Note 11.

ENERGY RESOURCES OF AUSTRALIA LTD
notes to tHe FInAnCIAL stAtements

24 Contingencies

Contingent liabilities
Potentially material legal actions against the Company:

The remaining argument in the action listed in the Federal Court against the former Commonwealth Minister for Resources and the
Company claiming that due process was not followed in granting approvals for the Jabiluka Mill Alternative is dormant. Should the
Company proceed with the Jabiluka Mill Alternative, notice will be given to the applicant who may or may not wish to pursue the
argument further.

No material losses are anticipated in respect of the contingent liability disclosed above.

25 Commitments

Capital commitments
Capital expenditure contracted for at the reporting date is as follows:

Within one year

2021
$’000

2020
$’000

Lease commitments
Future lease payments for short term and low value leases not provided for in the financial statements and payable:

Commitments in relation to leases contracted for at the reporting
date, but not recognised as liabilities, payable;

Within one year

Later than one year but not later than five years

Total short term and low value leases

2021
$’000

2020
$’000

The Company, from time to time, leases information technology equipment and small site tooling under short term and low value
leases expiring in less than one year.

Lease commitments recognised in the balance sheet
Lease liabilities recognised in the balance sheet are classified as a current liability when payable within one year and a non-current
liability when payable in greater than one year. No leases have payments due in greater than three years.

Mineral tenement leases
Future mineral tenement lease payments not provided for in the financial statements and payable:

Within one year

Later than one year but not later than five years

Later than five years

Total mineral tenement leases

2021
$’000

1,235

3,659

4,894

2020
$’000

1,197

4,841

6,038

In order to maintain current rights of tenure to mining tenements, the Company will be required to outlay an amount of $1.2 million
in the year ending 31 December 2022 in respect of tenement lease rentals. This includes payments for the Ranger Project Area and
Jabiluka Lease.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

The Company is liable to make payments to the Commonwealth as listed below:
(i)

(ii)

(iii)

An annual amount equal to the sum payable by the Commonwealth to the Northern Land Council pursuant to the Section
44 Agreement for rent for the duration of the agreement. This amounted to $1,074,791 for 2021 and is indexed for future
years.
Amounts equal to the sums payable by the Commonwealth to the Aboriginal Benefits Reserve pursuant to a determination
under Section 63(5) (b) of the Aboriginal Land Rights (Northern Territory) Act 1976. The Company is required to pay 2.5
per cent of Ranger net sales revenue to the Commonwealth and 1.75 per cent of Ranger net sales revenue to the Northern
Land Council, or an entity representing the Mirarr Traditional Owners as directed by the Northern Land Council (amounts
paid during 2021: $7,643,160; 2020: $9,672,272).
Amounts equal to sums payable by the Commonwealth to the Northern Territory pursuant to an understanding in respect of
financial arrangements between the Commonwealth and the Government of the Northern Territory. These amounts are also
calculated as though they were royalties and the relevant rate is 1.25 per cent of Ranger net sales revenue (amounts paid
during 2021: $2,247,988; 2020: $2,844,786).

The Company is liable to make payments to the Northern Land Council pursuant to the Section 43 Agreement between
Pancontinental Mining Limited and Getty Oil Development Company Limited and the Northern Land Council dated 21 July 1982,
which was assigned to the Company with the consent of the Northern Land Council, as listed below:

(i)
(ii)

Up front payment of $3,400,000 on the commencement of production at Jabiluka.
Annual royalty payments calculated at 4.5 per cent of net sales revenue, less $500,000 less any amounts paid to the
Aboriginal Benefits Reserve by the Commonwealth under the conditions specified in the Jabiluka Mineral Lease for the first
10 years and thereafter at 5 per cent of net sales revenue, less any amounts paid to the Aboriginal Benefits Reserve by the
Commonwealth under the conditions specified in the mineral lease (refer commitment below).

The Company is liable to make payments to the Commonwealth in respect of the Jabiluka project pursuant to the conditions attached
to the mineral lease. The amount payable was, until 30 June 1990, calculated at the rate of 5.25 per cent of net sales revenue from
the Jabiluka project. The Jabiluka project is now under long term care and maintenance and will not be developed without the consent
of the Mirarr Traditional Owners.

26 Auditor’s remuneration

During the year the auditor of the Company earned the following remuneration:

2021
$’000

2020
$’000

291

328

215

246

KPMG Australian firm

Audit and review of financial reports

Audit and review of financial reports (additional prior year fees)

Other non-audit related services

Total remuneration of KPMG Australia

PricewaterhouseCoopers Australian firm

Audit and review of financial reports

Audit and review of financial reports (additional prior year fees)

Other non-audit related services

Total remuneration of PricewaterhouseCoopers Australia

Total remuneration paid

ENERGY RESOURCES OF AUSTRALIA LTD

notes to tHe FInAnCIAL stAtements

27 Related parties

Directors
The names of persons who were Directors of the Company at any time during the financial year are as follows:

Peter Mansell, Shane Charles, Paul Dowd, Paul Arnold (resigned 4 October 2021), Justin Carey, Marcia Hanrahan (resigned 28 April
2021) and Jacques van Tonder.

Information relating to Directors’ compensation, shareholdings and retirement benefits is set out in the Remuneration Report in the
Directors’ Report.

Key management personnel

Key management personnel and Directors’ compensation

Short-term employee benefits

Post-employment benefits

Share-based payments

2021
$’000

2,988

201

491

2020
$’000

3,449

168

509

3,680

4,126

In compliance with Corporations Regulations 2001 2M.3.03 the Company has provided detailed remuneration disclosures in the
Directors’ Report. The relevant information can be found in the Remuneration Report on pages 33 to 48.

Loans with Directors and key management personnel
There were no loans with Directors or key management personnel during 2021 (2020: nil).

Transactions with Directors and Director-related entities
There were no transactions with Directors or Director-related entities other than Rio Tinto Limited during 2021 (2020: nil). Details of
transactions with Rio Tinto Group Companies are outlined below.

Ultimate parent entity
The ultimate parent entity is Rio Tinto Limited. This interest is held through North Limited (incorporated in Victoria, Australia) which
has beneficial ownership of 86.3 per cent of the issued ordinary shares of the Company. North Ltd owns 52.0 per cent directly and
the remaining 34.3 per cent through its subsidiary, Peko-Wallsend Pty Ltd. This follows the completion of the Entitlement Offer on
25 February 2020, prior to this Rio Tinto Limited held 68.4 per cent.

Interest income
Interest income is received from Rio Tinto Finance Ltd which holds cash on behalf of the Company.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Transactions with related parties
The following transactions occurred with related parties:

Management services fees paid to ultimate parent entity:

Rio Tinto Group Companies

Consulting fees paid to:

Rio Tinto Group Companies

Other reimbursements paid for commercial services received:

Rio Tinto Group Companies

Amounts received from related parties:

Rio Tinto Group Companies – sales

Rio Tinto Group Companies – interest

Rio Tinto Group Companies – employee transfers and minor receipts

Dividends paid to:

Related parties – North Ltd

Related parties – Peko-Wallsend Pty Ltd

2021
$’000

2020
$’000

(1,145)

(1,271)

(10,883)

(15,229)

190,347

242,222

172

2,067

556

870

Amounts received from related parties include sales of uranium oxide at market price. The Company is party to a marketing
agreement with Rio Tinto Uranium on the basis that it represented a superior value to the Company than alternative marketing
agreements considered. Under the marketing agreement, uranium oxide produced by the Company is sold to Rio Tinto Uranium;
a related party of Rio Tinto plc.

Outstanding balances arising from sales/purchases of goods and services
The following balances are outstanding at the reporting date in relation to transactions with related parties:

Aggregate amounts received from and payable to each class of other related parties at balance
date were as follows:

2021
$’000

2020
$’000

Current assets – cash assets

Related parties – Rio Tinto Finance Ltd

Current assets – receivables

Related parties – Rio Tinto Group Companies

Current liabilities – creditors

Related parties – Rio Tinto Group Companies

Current liabilities – income received in advance

Related parties – Rio Tinto Group Companies

86,040

61,657

27,017

2,187

2,074

4,309

All related party transactions were conducted on arm’s length terms and conditions and at market rates.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

28 Segment information
Description of segments
Management has determined the operating segment based on the reports reviewed by the Chief Executive that are used to make
strategic decisions.

The Chief Executive considers the business from a product prospective and has identified only one reportable segment in the year
ended 31 December 2021, being the processing, selling of uranium and site rehabilitation. There are no other unallocated operations.

Primary reporting – business segments
The segment information provided to the Chief Executive for the reportable segment is as follows:

Revenue from external customers

Other revenue

Total segment revenue

Segment result

Income tax benefit

Profit/(loss) for the year

Segment assets

Total assets

Segment liabilities

Total liabilities

Acquisitions of non-current assets

Depreciation and amortisation expenses

Other segment information

URANIUM

2021
$’000

2020
$’000

190,347

242,457

10,660

12,434

201,007

254,891

(647,395)

(2,817)

(650,212)

8,643

2,817

11,460

855,930

1,000,153

855,930

1,000,153

1,298,352

354

785,574

193

353

Segment revenue
The revenue from external parties reported to the Chief Executive is measured in a manner consistent with that in the
income statement.

Revenues from external customers are derived from the sale of uranium. A breakdown of revenue and results is provided in the tables
below. Segment revenue reconciles to total revenue from continuing operations as disclosed in Note 3.

The Company is domiciled in Australia. The result of its revenue from external customers in other countries is outlined in the
table below:

Asia

Total revenue

SEGMENT REVENUES
FROM SALES TO
EXTERNAL CUSTOMERS

2021
$’000

2020
$’000

190,347

242,222

190,347

242,222

Segment revenues are allocated based on the country in which the customer is located. During 2017 the Company entered into
a revised marketing agreement with Rio Tinto Uranium based in Asia. All uranium sales are to this customer. Details are disclosed
in Note 27.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Segment assets
The amounts provided to the Chief Executive with respect to total assets are measured in a manner consistent with that of the
financial statements. These assets are allocated based on the operations of the segment and the physical location of the asset.
Segment assets include all assets used by a segment and consist primarily of operating cash, receivables, inventories, property,
plant and equipment and other assets, net of provisions.

All assets of the Company as at 31 December 2021 are in Australia with the exception of inventories in transit, or at converters of
$22,524,134 (2020: $94,161,318). All acquisitions of property, plant and equipment and other non-current assets occurred in Australia.

Segment liabilities
The amounts provided to the Chief Executive with respect to total liabilities are measured in a manner consistent with that of the financial
statements. These liabilities are allocated based on the operations of the segment. Segment liabilities consist primarily of trade and other
creditors, employee entitlements and provisions. The Company does not have any borrowings as at 31 December 2021.

Reconciliation of loss after income tax to net cash inflow/(outflow) from
operating activities

2021
$’000

(650,212)

126

161

354

18,797

668,149

620

(1,599)

2,817

(11)

(25,587)

118,514

1,204

(2,487)

(168,780)

(37,934)

2020
$’000

11,460

193

(3,612)

353

23,897

6,529

1,677

(2,909)

(2,817)

1,612

24,272

1,663

(2,174)

(79,426)

(19,280)

Profit/Loss for the year

Add/(less) items classified as investing/financing activities:

Net (gain)/loss on sale or write-off of non-current assets

Net (gain)/loss on non hedge financial assets

Add/(less) non-cash items:

Depreciation and amortisation

Rehabilitation provision: unwinding of discount

Change in closure estimate

Employee benefits: share based payments

Interest on government security receivable

Recovery at deferred tax assets on hedge

Net exchange differences

Change in operating assets and liabilities

(Increase)/decrease in trade and other receivables

(Increase)/decrease in inventories

(Increase)/decrease in other assets

(Decrease)/increase in payables

(Decrease)/increase in provisions

Net cash inflow/(outflow) provided from operating activities

ENERGY RESOURCES OF AUSTRALIA LTD

notes to tHe FInAnCIAL stAtements

30 Earnings per share

Basic earnings/(loss) per share

Diluted earnings/(loss) per share

2021
CENTS

(17.6)

2020
CENTS

0.4

Earnings/(loss) used in the calculation of basic and diluted earnings per share: 2021: ($650,212,207) (2020: $11,460,136).

Weighted average number of ordinary shares on issue used in calculation of basic earnings per share: 2021: 3,691,383,198 shares
(2020: 3,204,465,785).

31 Financial risk management

The Company carries out risk management under policies approved by the Board of Directors. The Board provides principles for
overall risk management, as well as written policies covering specific areas, such as mitigating interest rate and other risks, use of
derivative and non-derivative financial instruments.

The Company operates entirely in Australia and is exposed primarily to Australian dollar denominated costs. Sales are primarily
denominated in US dollars.

Market risk
The Company markets its products internationally and is exposed to foreign exchange risk arising from various currency exposures,
primarily with respect to the US Dollar. Foreign exchange risk arises from future commercial transactions and recognised assets and
liabilities that are denominated in a currency that is not the entity’s functional currency. The risk is measured using sensitivity analysis
and cash flow forecasting.

The Company’s exposure to foreign currency risk at the reporting date was as follows:

Trade receivables

Trade payables

2021
USD
$’000

19,402

(346)

2020
USD
$’000

1,436

(3,329)

Group sensitivity
At 31 December 2021, had the Australian Dollar weakened/strengthened by 10 per cent against the US Dollar with all other variables
held constant, the change in trade receivables would have affected pre-tax profit for the year by $2,581,681 higher/lower (2020:
$186,929 higher/lower).

At 31 December 2021, had the Australian Dollar weakened/strengthened by 10 per cent against the US Dollar with all other variables
held constant, the change in trade payables would have effected pre-tax profit for the year by $46,071 higher/lower (2020: $433,490
higher/lower).

Commodity price risk
The Company uses a combination of both fixed and market price related contracts for future sales to manage this exposure. No
financial instruments are used by the Company to manage commodity price risk.

Interest rate risk
The Company’s main interest rate risk arises from cash on deposit. When cash is surplus to operational and investing requirements
it is invested in lump sum deposits to maximise interest received. In addition, the Company is exposed to interest rate risk on cash in
the government security receivable.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Credit risk
The Company has policies in place to ensure that sales of products are made to customers with an appropriate credit history. Where
customers are rated by an independent credit rating agency, these ratings are used to set credit limits. If no independent rating exists,
the credit quality of the customer is subject to extensive assessment. Letters of credit and other forms of credit insurance are also
used as required. Cash transactions and cash invested through the government security receivable are limited to high credit quality
financial institutions. The Company has policies that limit the amount of credit exposure to any one financial institution.

TRADE RECEIVABLES

BBB

Other

2021
$’000

29,062

2021
$’000

5,406

Liquidity and capital risk
ERA’s objectives when managing capital are to safeguard ERA’s ability to continue as a going concern, in order to provide returns for
shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

The future liquidity and capital requirements of ERA will depend on many factors. As a result of the rehabilitation provision increase,
ERA has insufficient funds to fully fund rehabilitation. ERA is continuing to review all funding options. An inability to obtain sufficient
funding would have a material impact on ERA’s business, financial performance and assessment as a going concern. Rio Tinto
has reiterated its commitment to ensuring the rehabilitation of the Ranger Project Area is successfully achieved to a standard that
will establish an environment similar to the adjacent Kakadu National Park. ERA is commencing active discussions with major
shareholders about a funding solution.

In April 2016, ERA entered into a $100 million credit facility agreement with Rio Tinto. ERA notes that due to the overrun of cost that
a “Review Event” may or may not have already occurred under the current terms of the facility and therefore Rio Tinto may not be
obliged to advance loans.

As at 31 December 2021, ERA had no debt and $699 million in total cash resources (comprising $164 million of cash on hand or at
call and $535 million invested as part of the government security receivable).

Fair value estimation
In 2020, the Company carried forward exchange contracts measured at fair value and presented within derivative financial
instruments on the face of the statement of financial position. These contracts were completed in 2021 and so have a fair value of
$nil (2020: $9,391,000). The valuation technique applied was forward pricing, which uses Level 1 observable inputs. The fair value
was determined using quoted forward exchange rates at the reporting date and present value calculations based on high credit
quality yield curves in the respective currency. The Company has not separately disclosed the fair values of financial instruments,
such as trade receivables and payables as well the government security receivable, because their fair values are their face value and
valuation techniques are not complex to warrant separate disclosure. These financial instruments also use Level 1 inputs.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

32 Events occurring after the reporting period

No other matters or circumstances has arisen since the end of the financial year that have significantly affected or may significantly
affect the operations or state of affairs of the Company in subsequent financial years.

33 Share-based payments

ERA participates in a number of share-based payment plans administered by Rio Tinto plc and Rio Tinto Limited, which are described
in detail in the Remuneration Report. These plans have been accounted for in accordance with the fair value recognition provisions of
AASB 2, ‘Share-based Payment’.

Rio Tinto Performance Share Awards
The Rio Tinto Performance Share Award (PSA) details are described in the Remuneration Report. The awards are accounted for in
accordance with the requirements applying to equity-settled share-based payments transactions. The fair value of each award on the
day of grant is set equal to the share price on the day of grant. No forfeitures are assumed. A summary of the status of shares granted
under the share plan at 31 December 2021, and changes during the year, is presented below:

BALANCE
AT START
OF THE
YEAR

GRANTED
DURING
THE YEAR

TRANSFERS
IN/(OUT)

EXERCISED
DURING
THE YEAR

FORFEITED
DURING
THE YEAR

BALANCE
AT END OF
THE YEAR

VESTED AND
EXER-
CISABLE AT
END OF
THE YEAR

2021

Rio Tinto Limited

Weighted average fair
value at grant date

2020

6,940

1,856

(8,583)

$85.06

$110.80

$90.43

Rio Tinto Limited

5,056

1,884

Weighted average fair
value at grant date

$87.82

$77.65

213

$93.17

6,940

$85.06

The weighted average share price at the date of exercise of conditional grants of shares exercised during the year ended 31
December 2021 was nil (2020: nil).

The weighted average remaining contractual life of conditional grants of shares outstanding at the end of the period was three years
(2020: four years).

Where shares are issued to employees of subsidiaries within the Rio Tinto Group, the subsidiaries compensate the parent for the
amount recognised as an expense in relation to these shares.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

myShare Savings Plan
The myShare plan was introduced to all eligible staff members in 2013 and is described in the Remuneration Report. Awards under
this plan are settled in equity and accounted for accordingly. The fair value of each award on the day of grant is set equal to the share
price on the day of grant.

A summary of the status of conditional shares granted under the plan at 31 December 2021, and changes during the year, is
presented below:

BALANCE
AT START
OF THE
YEAR

GRANTED
DURING
THE YEAR

TRANSFERS
IN/(OUT)

VESTED
DURING
THE YEAR

FORFEITED
DURING
THE YEAR

BALANCE
AT END OF
THE YEAR

VESTED AND
EXERCISABLE
AT END OF
THE YEAR

2021

Rio Tinto Limited

Weighted average
exercise price

2020

Rio Tinto Limited

Weighted average
exercise price

11,021

3,442

598

(7,797)

(728)

6,536

$89.75

$116.28

$89.75

$89.30

$97.98

$103.34

11,965

4,889

(482)

(3,750)

(1,601)

11,021

$77.49

$98.92

$81.62

$67.11

$81.62

$89.75

The weighted average share price at the date of exercise of conditional grants of shares exercised regularly during the year ended
31 December 2021 was $113.18 (2020: $97.10).

The weighted average remaining contractual life of share options outstanding at the end of the period was two years (2020: two
years).

Where shares are issued to employees of subsidiaries within the Rio Tinto Group, the subsidiaries compensate the parent for the
amount recognised as an expense in relation to these shares.

Rio Tinto Management Share Awards
The Rio Tinto Management Share Award (MSA) is described in the Remuneration Report. The awards will be settled in equity,
including the dividends accumulated from date of award to vesting. The awards are accounted for in accordance with the
requirements applying to equity-settled share-based payment transactions. The fair value of each award on the day of grant is
set equal to share price on the day of grant. No forfeitures were assumed. A summary of the status of shares granted under the
MSA plan at 31 December 2021, and changes during the year, is presented below:

BALANCE
AT START
OF THE
YEAR

GRANTED
DURING
THE YEAR

TRANSFERS
IN/(OUT)

EXERCISED
DURING
THE YEAR

FORFEITED
DURING
THE YEAR

BALANCE
AT END OF
THE YEAR

VESTED
AND EXER-
CISABLE
AT END OF
THE YEAR

2021

Rio Tinto Limited

12,924

4,358

(2,239)

(3,955)

Weighted average fair
value at grant date

2020

$85.08

$109.26

$83.09

$85.13

Rio Tinto Limited

14,641

4,664

Weighted average fair
value at grant date

$77.12

$74.36

(6,381)

$58.97

11,088

$94.97

12,924

$85.08

The weighted average share price at the date of exercise of conditional grants of shares exercised regularly during the year ended
31 December 2021 was $127.47 (2020: $95.27).

The weighted average remaining contractual life of conditional grants of shares outstanding at the end of the period was two years
(2020: two years).

Where shares are issued to employees of subsidiaries within the Rio Tinto Group, the subsidiaries compensate the parent for the
amount recognised an expense in relation to these shares.

ENERGY RESOURCES OF AUSTRALIA LTD notes to tHe FInAnCIAL stAtements

Bonus Deferral Award
The Bonus Deferral Award (BDA) is detailed and described in the Remuneration Report. These awards were established for the
mandatory deferral of a specific percentage of the Chief Executive’s Short Term Incentive Plan bonus payment into Rio Tinto shares.
The vesting of these awards is dependent only on service conditions being met. The awards will be settled in equity, including the
dividends accumulated from date of award to vesting. The awards are accounted for in accordance with the requirements applying to
equity-settled share-based payment transactions. The fair value of each award on the day of grant is equal to share price on the day
of grant. No forfeitures are assumed.

BALANCE
AT START
OF THE
YEAR

GRANTED
DURING
THE YEAR

TRANSFERS
IN/(OUT)

EXERCISED
DURING
THE YEAR

FORFEITED
DURING THE
YEAR

BALANCE
AT END OF
THE YEAR

VESTED
AND EXER-
CISABLE
AT END OF
THE YEAR

1,266

689

(1,306)

(649)

$84.15

$107.76

$92.12

$93.17

1,275

853

$87.45

$78.35

(862)

$83.40

1,266

$84.15

2021

Rio Tinto Limited

Weighted average fair
value at grant date

2020

Rio Tinto Limited

Weighted average fair
value at grant date

The weighted average share price at the date of exercise of conditional grants of shares exercised regularly during the year ended
31 December 2021 was $101.40 (2020: $97.65).

The weighted average remaining contractual life of share options outstanding at the end of the period was nil years (2020: two years).

Where shares are issued to employees of subsidiaries within the Rio Tinto Group, the subsidiaries compensate the parent for the
amount recognised as an expense in relation to these shares.

Expenses arising from share-based payment transactions
Total expenses arising from share-based payment transactions recognised during the period as part of employee benefit expense
were as follows:

Share based payment expense

2021
$’000

620

2020
$’000

1,677

ENERGY RESOURCES OF AUSTRALIA LTD DIReCtoRs' DeCLARAtIon

In the Directors’ opinion:

(a)

The financial statements and notes set out on pages 59 to 95 are in accordance with the Corporations Act 2001 (Cth),
including:

(i)

(ii)

Complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional
reporting requirements; and
Giving a true and fair view of the Company’s financial position as at 31 December 2021 and of its performance for
the financial year ended on that date; and

(b)

There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and
payable. Note 1 (a) confirms that the financial statements also comply with International Financial Reporting Standards as
issued by the International Accounting Standards Board.

The Directors have been given the declarations by the Chief Executive and the Chief Financial Officer required by section 295A of the
Corporations Act 2001 (Cth). This declaration is made in accordance with a resolution of the Directors.

P Mansell
Perth

15 March 2022

ENERGY RESOURCES OF AUSTRALIA LTD

InDePenDent AUDItoR's RePoRt

Independent Auditor’s Report

To the shareholders of Energy Resources of Australia Ltd

Report on the audit of the Financial Report

Opinion

We have audited the Financial Report of Energy
Resources of Australia Ltd (the Company).

In our opinion, the accompanying Financial
Report of the Company is in accordance with the
Corporations Act 2001, including:

• giving a true and fair view of the Company’s
financial position as at 31 December 2021
and of its financial performance for the year
ended on that date; and

•

complying with Australian Accounting
Standards and the Corporations Regulations
2001.

Basis for opinion

The Financial Report comprises:

• Balance sheet as at 31 December 2021.

• Statement of comprehensive income,

statement of changes in equity, and cash
flow statement for the year then ended.

• Notes including a summary of significant

accounting policies.

• Directors’ Declaration.

We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Our responsibilities under those standards are further described in the Auditor’s responsibilities for
the audit of the Financial Report section of our report.

We are independent of the Company in accordance with the Corporations Act 2001 and the ethical
requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics
for Professional Accountants (including Independence Standards) (the Code) that are relevant to our
audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in
accordance with the Code.

Material uncertainty related to going concern

We draw attention to Note 1(a)(i), “Going Concern” in the financial report. The conditions disclosed in
Note 1(a)(i), indicate a material uncertainty exists that may cast significant doubt on the Company’s
ability to continue as a going concern and, therefore, whether it will realise its assets and discharge
its liabilities in the normal course of business, and at the amounts stated in the financial report. Our
opinion is not modified in respect of this matter.

In concluding there is a material uncertainty related to going concern we evaluated the extent of
uncertainty regarding events or conditions casting significant doubt in the Company’s assessment of
going concern. Our approach to this involved:

• Evaluating the feasibility, quantum and timing of the Company’s plans to obtain additional funding

from its major shareholder to address going concern.

ENERGY RESOURCES OF AUSTRALIA LTD

InDePenDent AUDItoR's RePoRt

• Assessing the Company’s cash flow forecasts for incorporation of the Company’s operations and

plans to address going concern, in particular forecast rehabilitation expenditure.

• Determining the completeness of the Company’s going concern disclosures for the principle
matters casting significant doubt on the Company’s ability to continue as a going concern, the
Company’s plans to address these matters, and the material uncertainty.

Key Audit Matter

Key Audit Matters are those matters that, in our professional judgement, were of most significance in
our audit of the Financial Report of the current year.

The matter we identified was addressed in the context of our audit of the Financial Report as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on the matter.

Accounting for rehabilitation provision ($1,250.7 million)

Refer to Note 19 and 20 to the Financial Report

The key audit matter

How the matter was addressed in our audit

Accounting for the rehabilitation provision
was a key audit matter due to the size of
the provision, the increase in provision in
2021 and the significant and judgmental
assumptions used by the Company to
determine the provision.

We focused on the significant and
judgmental assumptions the Company
applied in their rehabilitation provision
including:

Our procedures included:

•

assessing the appropriateness of the Company’s
accounting policy for the recognition and
measurement of the rehabilitation provision with
the requirements of the accounting standards;

• working with our sustainability closure specialists

to:

– perform risk assessment procedures to identify

key rehabilitation activities;

• nature and extent of rehabilitation

– evaluate the methodology applied by the

activities required. This impacts the
completeness of the rehabilitation
provision estimate;

•

forecasted closure costs and timing
for key rehabilitation activities; and

• economic assumptions, such as the

discount rate.

The Company utilises both internal and
external experts to assist in the
determination of the rehabilitation
provision.

As a result of the above significant and
judgmental assumptions, this area
required significant audit effort.
Consequently, we included sustainability
closure specialists and valuation
specialists to supplement our senior audit
team members in assessing this key audit
matter.

Company’s external expert in determining the
nature and extent of rehabilitation activities by
comparison to industry practice; and

– assess certain assumptions regarding the
forecast closure costs of closure activities
based on their experience and familiarity with
applicable legislative requirements and industry
practice and the Company’s closure
commitments.

assessing the competence, scope and objectivity of
the Company’s internal and external experts used
in the determination of the rehabilitation provision;

inspected the most recent closure studies and
other technical material prepared by the Company
relating to changes in the closure provision to
assess the nature and scope of work planned to be
undertaken. This included assumptions relating to
the nature and timing of closure and rehabilitation
activities;

•

• performing testing over key rehabilitation controls
in relation to the process to identify changes in
rehabilitation activities required;

ENERGY RESOURCES OF AUSTRALIA LTD

InDePenDent AUDItoR's RePoRt

• on a sample basis, testing the basis of forecasted
closure cost by obtaining an understanding of the
nature of the estimate and inspecting underlying
documentation for forecast rehabilitation activities;

• obtaining the Company’s latest external expert

report as well as internal and external underlying
documentation to compare to the nature and
quantum of costs contained in the Company’s
rehabilitation provision;

•

testing the accuracy of the historical rehabilitation
provision by comparing to actual expenditure
incurred. We used this to challenge the Company’s
current cost estimations;

• we assessed the appropriateness of the discount

rate used by management;

•

testing mathematical accuracy of the Company’s
rehabilitation provision calculation; and

assessing the rehabilitation disclosures in the
financial report including disclosure of risks and
uncertainties using our understanding obtained
from our testing against the requirements of the
accounting standard. This included checking the
current and non-current rehabilitation provision
disclosure for consistency to the planned timing of
the rehabilitation expenditure.

Other Information

Other Information is financial and non-financial information in Energy Resources of Australia Ltd’s
annual reporting which is provided in addition to the Financial Report and the Auditor's Report. The
Directors are responsible for the Other Information.

Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not
express an audit opinion or any form of assurance conclusion thereon, with the exception of the
Remuneration Report and our related assurance opinion.

In connection with our audit of the Financial Report, our responsibility is to read the Other Information.
In doing so, we consider whether the Other Information is materially inconsistent with the Financial
Report or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

We are required to report if we conclude that there is a material misstatement of this Other
Information, and based on the work we have performed on the Other Information that we obtained
prior to the date of this Auditor’s Report we have nothing to report.

Responsibilities of the Directors for the Financial Report

The Directors are responsible for:

• preparing the Financial Report that gives a true and fair view in accordance with Australian

Accounting Standards and the Corporations Act 2001.

•

implementing necessary internal control to enable the preparation of a Financial Report that gives a
true and fair view and is free from material misstatement, whether due to fraud or error.

• assessing the Company’s ability to continue as a going concern and whether the use of the going
concern basis of accounting is appropriate. This includes disclosing, as applicable, matters related
to going concern and using the going concern basis of accounting unless they either intend to
liquidate the Company or to cease operations or have no realistic alternative but to do so.

ENERGY RESOURCES OF AUSTRALIA LTD

InDePenDent AUDItoR's RePoRt

Auditor’s responsibilities for the audit of the Financial Report

Our objective is:

•

to obtain reasonable assurance about whether the Financial Report as a whole is free from material
misstatement, whether due to fraud or error; and

to issue an Auditor’s Report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with Australian Auditing Standards will always detect a material misstatement when it
exists.

Misstatements can arise from fraud or error. They are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of this Financial Report.

A further description of our responsibilities for the audit of the Financial Report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar2_2020.pdf. This description forms part of our
Auditor’s Report.

Report on the Remuneration Report

Opinion
In our opinion, the Remuneration Report of
Energy Resources of Australia Ltd for the year
ended 31 December 2021, complies with Section
300A of the Corporations Act 2001.

Directors’ responsibilities
The Directors of the Company are responsible for
the preparation and presentation of the
Remuneration Report in accordance with Section
300A of the Corporations Act 2001.

Our responsibilities
We have audited the Remuneration Report
included in the Directors’ report on pages 33 to 48
for the year ended 31 December 2021.

Our responsibility is to express an opinion on the
Remuneration Report, based on our audit
conducted in accordance with Australian Auditing
Standards.

KPMG

Derek Meates
Partner

Perth

15 March 2022

100

ENERGY RESOURCES OF AUSTRALIA LTD

sHAReHoLDeR InFoRmAtIon (UnAUDIteD)

Energy Resources of Australia Ltd is a for-profit company limited by shares, incorporated and domiciled in Australia.

The financial statements were authorised by Directors on 15 March 2022. The Directors have the power to amend and reissue the
financial statements.

The shareholder information set out below was applicable as at 28 February 2022.

Distribution of equity securities
Analysis of numbers of registered equity security holders by size of holding:

1 - 1,000

1,001 - 5,000

5,001 – 10,000

10,001 – 100,000

100,001 and over

5,087

2,569

895

1,167

132

9,850

ORDINARY SHARES

NUMBER
OF SHARE-
HOLDERS

% OF
SHARE-
HOLDERS

NUMBER
OF SHARES

1,517,188

6,715,598

6,916,312

33,527,954

51.64%

26.08%

9.09%

11.85%

1.34%

3,642,706,146

100.00%

3,691,383,198

There were 5,710 holders of less than a marketable parcel of ordinary shares.

Substantial shareholders
Substantial shareholders as disclosed in substantial shareholder notices provided to the Company:

North Limited1

Peko-Wallsend Ltd1

Packer & Co Limited ATF Packer & Co Investigator Trust2

Note 1
Note 2

As lodged 27 February 2020.
As lodged 13 February 2020.

NUMBER
OF SHARES

1,920,852,964

1,265,829,670

35,931,878

% OF
ISSUED
SHARES

0.04%

0.18%

0.19%

0.91%

98.68%

100.00%

% OF
ISSUED
SHARES

52.04%

34.29%

6.94%

101

ENERGY RESOURCES OF AUSTRALIA LTD
sHAReHoLDeR InFoRmAtIon (UnAUDIteD)

Equity security holders
The names of the twenty largest registered holders of quoted equity securities are listed below:

North Limited

Peko-Wallsend Ltd

BNP Paribas Noms Pty Ltd

HSBC Custody Nominees (Australia) Limited

BNP Paribas Nominees Pty Ltd Six Sis Ltd

BNP Paribas Nominees Pty Ltd ACF Clearstream

Citicorp Nominees Pty Limited

BNP Paribas Nominees Pty Ltd

Neweconomy Com Au Nominees Pty Limited

J P Morgan Nominees Australia Pty Limited

Creative Living (Qld) Pty Ltd

Airport Finance Pty Ltd

Mrs An-Shu Tseng

Mr Li Wan

Mr Samuel Lin

Mr Kien Tuong Ta

Mrs Patricia Anne Allen and Mr Robert Stanley Allen

Mr Mark Watson

Australian Executor Trustees Limited

Mrs Faye Lesley Duffield

Lemmis Holdings Pty Ltd

NUMBER
OF SHARES

1,920,852,964

1,265,829,670

293,256,715

78,697,634

35,618,969

4,920,133

4,666,106

1,830,291

1,410,728

1,327,823

1,160,000

1,000,000

930,198

923,265

900,000

766,500

750,000

739,478

735,110

713,000

% OF
ISSUED
SHARES

52.04%

34.29%

7.94%

2.13%

0.96%

0.14%

0.13%

0.05%

0.04%

0.03%

0.02%

Entitlements to vote
Subject to any rights or restrictions for the time being attached to
any shares on a show of hands, every member present in person
or by proxy or by attorney or by representative and entitled to
vote at a shareholders’ meeting shall have one vote.

On a poll, every member present in person or by proxy or by
attorney or by representative shall have one vote for each share
held by him/her.

All substantive resolutions at a meeting of security holders are
decided by a poll.

Tax file numbers
Tax file numbers or exemption details are recorded from
shareholders who wish to provide the information. Dividend
advice statements, when issued to shareholders, indicate

102

whether or not a shareholder’s tax file number has been
recorded. ERA normally pays fully franked dividends. In the
event of an unfranked dividend being paid, ERA will be required
to deduct tax at the top marginal rate from the dividend paid to
shareholders resident in Australia who have not supplied a tax
file number or exemption form.

Information on shareholding
Shareholders who require information about their shareholding
or dividend payment should contact ERA’s principal registry.

Shareholders who have changed their address should advise
the change in writing to:

ERA Share Registry
Computershare Investor Services Pty Ltd
Level 1, 200 Mary Street
Brisbane QLD 4000
Telephone: +61 (0) 3 9473 2500
Facsimile: +61 (0) 3 9415 4000

Sponsored shareholders should note, however, that they should
contact their sponsored broker to initiate a change of address.

ENERGY RESOURCES OF AUSTRALIA LTD 2021 Asx AnnoUnCements (UnAUDIteD)

31 March 2021

Notice of Annual General Meeting

25 March 2021

Appendix 3Y - J van Tonder

25 March 2021

Appendix 3Y - J Carey

25 March 2021

Appendix 3Y - M Hanrahan

25 March 2021

Appendix 3Y - P Arnold

5 March 2021

4 March 2021

3 March 2021

2020 Annual Report

Appendix 4G

Appendix 3Y - M Hanrahan

Appointment of Chief Financial
Officer

25 February 2021

Change of Director's Interest Notice

24 February 2021

Financial Community Presentation -
2020 Full Year Results

24 February 2021

Appendix 3Y - J van Tonder

24 February 2021

Appendix 3Y - J Carey

24 February 2021

Appendix 3Y - P Arnold

15 February 2021

ERA 2020 Full Year Results

15 February 2021

Annual Statement of Reserves and
Resources

15 February 2021

Preliminary Final Report

22 January 2021

Appendix 3Y - J Carey

22 January 2021

Appendix 3Y - P Arnold

8 January 2021

Quarterly Activities Report

10 December 2021

19 November 2021

Resignation and appointment of
Company Secretary

Ranger Rehabilitation cost and
schedule overruns - update

25 October 2021

Appendix 3Y - J Carey

12 October 2021

Quarterly Activities Report

8 October 2021

Ranger Rehabilitation cost and
schedule overruns - material

8 October 2021

Appendix 3Z - P Arnold

7 October 2021

Appendix 3Y - J Carey

6 October 2021

Appendix 3Y - P Arnold

4 October 2021

Resignation of Chief Executive - Mr
Welsh appointed (Acting)

1 October 2021

Pause in Trading

27 September 2021

Ranger Rehabilitation Project cost
and schedule overruns

5 August 2021

Appendix 3Y - P Arnold

28 July 2021

26 July 2021

7 July 2021

14 May 2021

12 May 2021

5 May 2021

28 April 2021

26 April 2021

23 April 2021

7 April 2021

June 2021 Half Year Results

Half Yearly Report and Accounts

Appendix 3Y - P Arnold

Appendix 3Y - J Carey

Quarterly Activities Report

Appendix 3Y - J Carey

Appendix 3Y - P Mansell

Appendix 3Y - J van Tonder

Final Director's Interest Notice

2021 Annual General Meeting -
Results of Meeting

2021 Chief Executive's Address

2021 AGM Chairman's Address

Resignation of director

Appendix 3Y - J van Tonder

Appendix 3Y - J Carey

Appendix 3Y - M Hanrahan

Appendix 3Y - P Arnold

Quarterly Activities Report

31 March 2021

Annual General Meeting Proxy Form

Details of these announcements are available at www.energyres.com.au.

103

ENERGY RESOURCES OF AUSTRALIA LTD ten yeAR PeRFoRmAnCe (UnAUDIteD)

YEAR ENDED
31 DECEMBER

Sales Revenue ($000)
Earnings Before Interest
and Tax ($000)
Profit/(Loss) Before Tax
($000)
Income Tax Expense/
(Benefit) ($000)
Profit/(Loss) After Tax
($000)
Total Assets ($000)
Shareholders’ Equity ($000)
Long Term Debt ($000)
Current Ratio
Liquid Ratio
Return on Shareholders’
Equity (%)
Earnings Per Share (cents)

Share Price ($) closing
Price-Earning Ratio
Net Tangible Assets per
Share ($)
No. of Employees
Profit After Tax per
Employee ($000)
Ore Mined (million tonnes)
Ore Milled (million tonnes)
Mill Head Grade (% U3O8)
Mill Recovery (%)
Production (tonnes U3O8) –
Drummed
Sales – Ranger
Concentrates (tonnes U3O8)
Sales – Other Concentrates
(tonnes U3O8)
Sales – Total (tonnes U3O8)

(442,422)
-
1.1
0.7

147.0
(17.6)

0.34
(1.93)

(0.12)
204

(3,187.3)
-
0.02
0.07
86.1

2021

2020

2019

2018

2017

2016

2015

2014

2013

2012

190,347

242,457

209,677

201,273

211,181

267,765

332,777

379,166

356,139

396,629

(648,967)

3,413

(1,103) (466,616)

(52,925) (279,781)

(88,292) (284,274) (199,431) (278,266)

(647,395)

8,643

6,252 (456,323)

(43,532) (271,077)

(79,798) (273,602) (186,541) (254,785)

2,817

(2,817)

(21,049)

195,695 (85,802)

(50,712)

(36,026)

(650,212)

11,460
855,930 1,000,153

6,252 (435,274)
635,766
566,577
214,579 (274,687) (280,790)
-
2.5
1.9

-
2.0
1.2

-
2.1
0.9

(43,532) (271,077) (275,493) (187,800) (135,829) (218,759)
819,432 1,100,815 1,341,724 1,627,561 1,826,275
797,312
934,022 1,069,619
745,607
198,559
154,887
-
-
-
-
4.0
4.1
4.0
3.2
2.9
2.7
3.1
2.5

469,947
-
4.0
3.0

-
3.8
2.3

5.3
0.4

0.33
82.5

0.06
317

36.15
-
2.5
0.07
84.9

2.3
1.2

0.17
13.75

(0.54)
352

155.0
(84.1)

0.25
(0.29)

(0.54)
355

(28.1)
(8.4)

0.91
(10.83)

(136.5)
(52.4)

0.44
(0.83)

0.30
358

0.38
356

(58.6)
(53.2)

0.36
(0.68)

0.91
374

(25.2)
(36.3)

1.30
(3.58)

(14.5)
(26.2)

1.26
(4.81)

1.44
389

1.80
519

(20.5)
(42.3)

1.27
(3.00)

2.07
594

17.61 (1,226.1)
-
2.5
0.09
86.6

-
2.5
0.08
86.8

(121.6)
-
2.6
0.10
84.7

(761.5)
-
2.7
0.10
84.9

(736.6)
-
2.5
0.10
82.0

(482.8)
-
1.3
0.11
81.5

(264.8)
-
2.3
0.15
84.8

(374.5)
3.8
2.6
0.17
86.2

1,574

1,751

1,999

2,294

2,351

2,005

1,165

2,960

3,710

1,302

1,711

1,577

1,467

2,089

2,130

2,183

2,164

2,767

2,665

984

558

1,302

1,721

1,597

1,467

2,089

2,139

2,183

3,148

2,815

3,223

Definition of statistical ratios
Current Ratio
Liquid Ratio
foreign exchange
Gearing Ratio
Interest Cover
Return on Shareholders’ Equity
Earnings per Share

=
=

=
=
=
=

current assets/current liabilities
(current assets-inventory-prepayments-foreign exchange hedge asset on borrowings)/(current liabilities-bank overdraft –
hedge liability)
(long term debt + term creditors)/(shareholders’ equity + long term debt + term creditors)
earnings before interest and tax/interest expense
profit after tax/average shareholders’ equity
profit after tax/weighted average number of shares issued

104

ENERGY RESOURCES OF AUSTRALIA LTD

Tony De Groot and Rachel Meier carrying out water sampling at Ranger Mine.