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Annual Report 2009

Plain-text annual report

RAMELIUS RESOURCES LIMITED 2009 ANNUAL REPORT CONTENTS Chairman’s Report Chief Executive Officer’s Report Review of Operations Native Title Corporate Governance Statement Glossary of Terms Photographs & Diagrams Directors’ Report Auditor’s Independence Declaration Income Statement Balance Sheet Statement of Changes in Equity Cash Flow Statement Notes to the Financial Statements Directors’ Declaration Independent Audit Report Shareholder Information Corporate Directory 01 02 03 10 11 24 29 34 46 47 48 49 51 52 86 87 90 Back Cover Ramelius Resources Limited ACN 001 717 540 ABN 51 001 717 540 Annual General Meeting The Annual General Meeting of Ramelius Resources Limited will be held at Enterprise House, 136 Greenhill Road, Unley, South Australia on Friday 27 November 2009 at 11.00 am Adelaide time. Front Cover: Images at Wattle Dam Mine and Burbanks Mill Below: Development adjacent to Emergency Escapeway at Wattle Dam Mine Stock Exchange The Company is listed on the Australian Securities Exchange Limited. The Home Exchange is Adelaide. ASX Codes Shares: RMS Options: RMSOC CHAIRMAN’S REPORT Dear Shareholder, It is with pleasure that I present to you the 2009 Annual Report of Ramelius Resources Limited. Significant progress has been made over the past twelve months towards establishing the Company as a high grade underground miner. As at June 30, 2009 the Company was in a strong financial position with cash on hand of $26.7 million. Significant milestones achieved by Ramelius during the year were as follows: • A net profit after income tax expense of $4.97 million for the 2009 financial year; • Completion of the pit cut back at Wattle Dam; • Production of 16,283 ounces of gold and revenue of $19.8 million; • Commencement of the Wattle Dam underground mine in May, 2009; and • Substantially completed the rehabilitation of the Wattle Dam Waste Dump. The financial result of a $4.97 million net profit was an excellent result and is the third year that the Company has achieved this outcome. The result reflects the focus the Company continues to have on low cost that operations as the principle driver its business activities. for The Company again benefited from the gold overcall at Wattle Dam. It was planned to produce 5,620 ounces of gold from the cut back to the open pit, with actual production of 16,283 ounces. This is a positive outcome for the mine, as we are about to commence production from the high grade underground resource. In March 2009 the Company selected HWE Mining Pty Limited to undertake the mining of the underground project, and operations commenced in May, 2009 with the first cut of the portal. Significant progress was made by the end of the financial year, with over 253 metres of decline completed in two months. The Company’s Burbanks mill also performed well during the year, with over 158,000 tonnes of ore processed and recoveries above 96 percent. The Burbanks mill has been a significant purchase for the Company, ensuring cash flows are received in a timely manner without being reliant on third party mills. Ramelius has completed the also substantially rehabilitation of waste dumps from its open pit operations to a high industry standard. This is an important step towards ensuring that regulatory and social expectations are met as the project moves forward. that It was also announced during the year the Company’s founding Managing Director Mr. Joe Houldworth would retire. I would like to thank Joe for his vision and enthusiasm to develop Ramelius into the position it is in today. It is also with great pleasure that I acknowledge that Joe will stay on as a Non-Executive Director. I would like to thank shareholders for their loyalty and support throughout the year and together with my fellow directors, look forward to being able to deliver high grade production in 2009/10. I also take this opportunity to sincerely thank our Directors, all our employees and consultants for their efforts throughout the year. Bob Kennedy Chairman 01 CHIEF EXECUTIVE OFFICER’S REPORT Dear Shareholder, The past year has been a year of consolidated production and development for the Company. The open pit cut back was expected to be completed by the end of 2008, but mining was slowed due to hard mining conditions and the large number of ore tonnes extracted. The pit did however produce over 16,000 ounces of gold, which was approximately three times that expected. This outcome, whilst not taken for granted, was in line with results from the original pit. The pit cut back was designed to provide access to fresh rock in which the portal and decline could be established. The pit was completed in April 2009 and the underground portal and decline were established in the western wall of the pit in May 2009. The Company selected HWE Mining Pty Limited as its primary underground contractor and to date this arrangement has been very successful. The underground mine is expected to be one of Australia’s highest grade underground mines, producing an expected base case 68,000 ounces of gold up to November 2010. First development ore should be milled in November 2009 and high grade stoping ore from January 2010. At this time the mine will be in full production. Deep exploration drilling continues below the current mine plan, with the current drilling defining the mine geology and visible gold up to 300 metres below surface. During the year, diamond drilling intersected a significant result of 5.5 metres at 148 g/t gold below the current mine plan. This and other deeper results will be followed up with drilling from underground in early 2010. results at Regional exploration continued during the year, with significant the Golden Orb and 8500N prospects. These results will be followed up in the 2009/10 year. Several new projects were reviewed dur- ing the year, with none meeting the Company’s criteria of acquiring projects with potential for low cost production. The Company is now entering an exciting time where it is finally gaining access to the high grade zone at Wattle Dam. It is also a time where the Company will begin to look for growth opportunities; both through exploration and acquisition. I would like to take this opportunity to thank the Ramelius team and our contractors for their dedication to getting the job done well in the 2009 year. I would also like to thank my fellow directors for their continued support and guidance. Ian Gordon Chief Executive Officer 02 REVIEW OF OPERATIONS Financial Highlights • Sales revenue of $19.8 million from gold sales of 15,393 ounces at an average price of A$1,288 per ounce. • Net profit after tax of $4.97 million (up from $0.61 million in 2008) • $17.9 million additional capital raised during the year • Cash at the end of the financial year of $26.7 million. Revenue from gold sales of $19.8 million was up 33.8% from the previous year and reflects a stronger average gold price during the current year of A$1,288 per ounce. Consolidated net profit after tax was $4,973,356. Additional capital totalling $17.9 million was raised from a $13.4 million placement of shares to institutional and sophisticated investors and an issue of $4.5 million of shares to shareholders under the Company’s Share Purchase Plan at $0.53 per share. At 30 June 2009 the Company had no debt and held cash assets of $26.7 million. 03 REVIEW OF OPERATIONS Operational Highlights • Completion of the pit cut back at Wattle Dam in April 2009 • Production of 16,283 ounces of gold from the pit cut back • Commencement of high grade underground mine in May 2009 MINING AND MILLING OPERATIONS The Wattle Dam Gold mine is located approximately 25km south-west of Kambalda in the Eastern Goldfields of Western Australia. The gold resource at Wattle Dam is hosted in sheared ultramafic rocks and has been drilled to a vertical depth of over 200 metres. The mine commenced production in March 2006 and as at 30 June 2009, two phases of mining had been completed. A cut back to the open pit was completed in April 2009 to establish access to fresh rock for the underground portal. The Company appointed HWE Mining Pty Limited as its underground contractor in March 2009. The underground mine at Wattle Dam was commenced in May 2009 with the portal cut and by the end of June 2009, the decline was advanced by 253 metres (refer Figure 1 on page 29). Mining During the 2009 financial year a total of 158,038 tonnes of ore was mined from the pit cut back at a grade of 3.34 grams per tonne gold. In May 2009 the portal was established at a depth of 75 metres below surface into the west side of the pit (refer Figure 2 on page 29). The underground decline and cross cuts will intersect the top of the ore body at a depth of 99 metres below surface, immediately below the north western edge of the open pit. Milling A total of 151,697 tonnes of ore was processed during the 2009 financial year at the Company’s gold treatment plant at Burbanks, near Coolgardie. The mill performed well during the year, treating ore at capacity since September 2008. Production Statistics – 2009 Financial Year Unit Mined Grade g/t gold Ore processed tonnes 151,697 3.59 Recovery Gold Production* Gold Production* % oz kg 96 16,283 506.4 * Includes G.I.C. recovered Rehabilitation During the year, the Company completed a substantial rehabilitation program over the open pit waste dump, including slope design, replacement and vegetation spreading (refer Figure 3 on page 30). top soil At the date of this report, the underground mine was well advanced, with ore development commencing in September 2009 and full production expected by January 2010. 04 REVIEW OF OPERATIONS EXPLORATION Ramelius controls the gold rights and majority nickel rights over approximately 220 km2 covering the Kunanalling and Spargos Reward Shears. Gold exploration during the year was conducted at the Wattle Dam, Golden Orb, 8500N, West Wattle Dam and Black Cat prospects whilst nickel exploration was conducted at Regional exploration focusing on both gold and nickel was also conducted within the project area (refer Figure 4 on page 30). the 1A North prospect. Wattle Dam Project (Gold, Tantalum, Nickel) (100% Gold, Tantalum and earning 80% Nickel Rights; MLs; 15/1101; 15/1263; 15/1264; 15/1323; 15/1338; 15/1769-1773; PL 15/4479, 100% MLs 1774-1776; PL 15/4381 [MLA 15/1474]) Wattle Dam Gold Mine (Gold) Exploration diamond drilling totalling 19 holes for 5,968.9 metres was completed at Wattle Dam. The drilling was focused on the definition of the high grade gold zone immediately beneath and to the north of the open pit and defining further high grade mineralisation further down plunge. High grade intersections returned from within the underground mine plan include 4 metres at 14.4g/t gold from 204 metres including 1 metre at 54.1g/t from 204 metres. Further high grade intersections including 5.5 metres at 148g/t Au from 273.5 metres (including 0.2 metres at 1,846g/t gold from 273.9 metres and 0.6 metres at 738g/t gold from 277.4 metres) and 3 metres at 7.7g/t gold from 284 metres were received from drilling completed down plunge to the north of the mine plan. These intersections highlight the potential for further high grade resources underneath the current underground mine plan (refer Figure 5 on page 31). Further drilling is planned to extend and define mineralisation associated with these intersections. An updated mineral resource estimate for the Wattle Dam Gold Deposit was completed. The mineral resource estimate included all resources outside of the Stage 1 pit. The total estimated contained ounces within the resource has increased by 43% since the initial resource estimate completed in 2007. Using a 1.0g/t gold lower cut, the total JORC compliant Indicated and Inferred resource is estimated at 677,000 tonnes @ 5.5 g/t gold containing 118,600 ounces of gold. Within the total mineral resource there are four higher grade (≥8.0g/t Au) zones which are estimated to contain a total of 131,000 tonnes @ 18.8 g/t gold for 79,000 ounces, or 65% of the gold within the resource. A top cut of 400g/t gold was applied to the above four higher grade zones. evaluate completed to further Golden Orb (Gold) A program of 15 diamond drill holes for 3,095.7 metres was interpreted north-northwest trending mineralised zones identified by previous RC drilling which returned a maximum result of 7 metres @ 10.9 g/t gold from 117 metres. The completed diamond drilling intersected zones of quartz- carbonate veining and minor visible gold within weak to moderate chlorite/carbonate/pyrite altered ultramafic lithologies. Maximum results returned from the drilling include 1 metre at 99.1g/t gold from 199 metres and 10 metres at 3.2g/t gold from 176 metres. The drilling identified and intersected a structure which dips 48 degrees towards the east-northeast which is interpreted to offset mineralisation to the east and down the structure, (dextral dip-slip movement). Further drilling at Golden Orb is likely to be orientated to evaluate the offsetting structure and the interpreted offset location of the mineralised trend at depth. 8500N (Gold) is located approximately 600 The 8500N Prospect metres to the north of the Wattle Dam Gold Mine. The prospect is defined by an 800 metre long, >50ppb gold in soil anomaly. Drilling of the soil anomaly by previous explorers was completed at 200 metre line spacings. A total of 21 RC drill holes for 2,317 metres were drilled over the most significant portion of the soil anomaly in order to infill previous drilling to 20 metres x 40 metres drill spacing. The drilling intersected predominantly felsic lithologies in contact with ultramafic lithologies to the east and west. Two zones of mineralisation were interpreted from the results of the drilling, comprising a supergene zone within the weathering profile overlying the felsic lithologies and a fresh rock zone associated with the eastern felsic/ ultramafic contact. Maximum results returned from the zone include 20 metres at 5.3g/t gold from 40 metres including 9 metres at 8.5g/t gold from 40 metres and 4 metres at 4.9g/t gold from 84 metres including 1 metre at 10.1g/t gold from 86 metres respectively. 05 REVIEW OF OPERATIONS A program of 10 RC drill holes has been generated to follow up the above zones of mineralisation along strike to the north and south and down dip. Two lines of Aircore drilling spaced 200 metres to the north and south of the above significant RC drilling were completed for a total of 21 holes for 1,001 metres. The drilling was designed to test the supergene mineralisation and contact associated mineralisation identified at 8500N. Anomalous results were received from this drilling associated with both the supergene and contact related zones identified at 8500N, however the grades within the zone ranged from 0.1 to 0.8 g/t gold. for extensions of West Wattle Dam (Gold) A program of 40 Aircore (hammer) holes for 1,476 metres was completed in order to evaluate an area of auger gold anomalism associated with physical gold within quartz veining located at the surface. The drilling was completed at spacings of 20 metres x 25/50 metres. Drilling results returned a maximum intercept of 8 metres at 0.27g/t gold from 16 metres from drilling completed underneath the identified gold mineralised quartz veining at surface. 1A North (Nickel) One diamond drill hole for 297 metres was completed to evaluate a strong off-hole conductor indentified by Down Hole Transient Electromagnetics (DHTEM) in earlier drilling. The hole consisted of a 198 metre RC precollar with a 99 metre diamond tail. The drill hole intersected a complex range of lithologies, with the conductor identified as a narrow interval of pyrrohtite rich ultramafic. Subsequent DHTEM of this hole identified a moderate in hole anomaly at this depth. Regional RAB/Aircore Drilling (Gold and Nickel) A large program of Aircore drilling (199 holes for approximately 7,245 metres) was completed. The drilling was designed to evaluate several areas anomalous in gold and nickel and trends to the east and south of the Wattle Dam Gold Mine as well as infill anomalous regional drilling to the north of Wattle Dam (Central Area) to a drill spacing of 40 metres x 200 metres. A number of nickel anomalies were generated from the drilling program. The most significant results, including 11 metres at 6,858ppm Nickel from 28 metres (SRAC0338) and 12 metres at 6,053ppm Nickel from 28 metres (SRAC0312), lie adjacent and along strike of the western contact of an ultramafic belt to the east of the Wattle Dam Gold Mine. The gold results from the completed drilling highlighted a number of significant (≥0.5g/t gold) anomalies. A maximum intercept of 20 metres at 1.0g/t gold from 32 metres including 4 metres at 3.1g/t gold from 32 metres within SRAC0277 was received. This intercept is located 40 metres to the north of a significant intersection of 4 metres @ 4.7g/t gold from 49 metres within previous RC drilling, (WDRC086). Further Aircore drilling designed to infill areas of nickel and gold anomalism and to extend the completed drilling is planned for the coming year. North Widgiemooltha Blocks (100% Gold Rights) 15/101; 15/102; 15/653; ML 15/1271) (MLs 15/97; 15/99; 15/100; North Widgiemooltha Regional A total of three RC holes for 231 metres were drilled to follow up a significant intercept of 12 metres @ 5.5g/t gold from 28 metres including 4 metres at 10.5g/t gold from 32 metres, located 300 metres south of Golden Orb. Drilling was completed over a single line with holes drilled every 10 metres. A significant result of 3 metres at 2.2g/t gold from 36 metres (NWRC0016) was returned down dip from the above significant result. No immediate follow up drilling is planned. The Information in this report that relates to Exploration Results is based on information compiled by Matthew Svensson and Diane Tily-Laurie. Matthew Svensson is a Member of the Australian Institute of Geoscientists and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting on Exploration Results. Matthew Svensson is a full-time employee of the Company and consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Diane Tily-Laurie is a Member of the Australian Institute of Mining and Metallurgy and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity she is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting on Exploration Results. Diane Tily-Laurie is a full-time employee of the Company and consents to the inclusion in the report of the matters based on her information in the form and context in which it appears. The information in this report that relates to in-situ mineral resources is based on information compiled by Scott Jarvis of Ramelius Resources Limited. Scott Jarvis has taken overall responsibility for the report. He is a Member of the Australian Institute of Geoscientists and has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is undertaking, to qualify as a Competent Person in terms of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code 2004 Edition). Scott Jarvis consented to the inclusion of such information in this report in the form and context in which it appears. 06 REVIEW OF OPERATIONS Interests in Mining Tenements The Company’s interests in mining tenements are as follows: Project Location Tenement Status Application Date Grant Date Expiry Date Associated Tenement ID Acquiring % Acquired % Registered Beneficial Owner Owner Coolgardie Coolgardie Coolgardie P15/5399 P15/5400 P15/5462 Application Application Application 13-May-09 13-May-09 1-Sep-09 100% 100% Ramelius Ramelius Chitty Ramelius Ramelius Ramelius 90% Coolgardie M16/34 Granted 15-Sep-86 28-Jan-87 27-Jan-29 90% Ramelius Ramelius Bullabulling Bullabulling Bullabulling Jaurdi/ Black Cat Jaurdi/ Black Cat Coolgardie M16/115 Granted 29-Sep-88 10-Sep-90 9-Sep-11 Hilditch Coolgardie M15/1448 Granted 9-Mar-04 30-Jun-08 29-Jun-29 Wattle Dam Coolgardie M15/1101 Granted 26-Mar-97 19-Mar-04 18-Mar-25 Wattle Dam Coolgardie M15/1263 Granted 23-Oct-98 24-Aug-04 23-Aug-25 Wattle Dam Coolgardie M15/1264 Granted 23-Oct-98 24-Aug-04 23-Aug-25 Wattle Dam Coolgardie M15/1323 Granted 10-Feb-00 30-Jun-08 29-Jun-29 Wattle Dam Coolgardie M15/1338 Granted 9-Jun-00 30-Jun-08 29-Jun-29 Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius 90% 90% 100% & 80% of Ni Rights 100% & 80% of Ni Rights 100% & 80% of Ni Rights 100% & 80% of Ni Rights 100% & 80% of Ni Rights Wattle Dam Coolgardie M15/1474 Application 12-Apr-04 P15/4381 100% Ramelius Ramelius Wattle Dam Coolgardie M15/1769 Granted 1-Feb-06 30-Jun-08 29-Jun-29 Wattle Dam Coolgardie M15/1770 Granted 1-Feb-06 30-Jun-08 29-Jun-29 Wattle Dam Coolgardie M15/1771 Granted 1-Feb-06 30-Jun-08 29-Jun-29 Wattle Dam Coolgardie M15/1772 Granted 1-Feb-06 30-Jun-08 29-Jun-29 Wattle Dam Coolgardie M15/1773 Granted 1-Feb-06 30-Jun-08 29-Jun-29 Wattle Dam Coolgardie M15/1774 Granted 1-Feb-06 30-Jun-08 29-Jun-29 Wattle Dam Coolgardie M15/1775 Granted 1-Feb-06 30-Jun-08 29-Jun-29 Wattle Dam Coolgardie M15/1776 Granted 1-Feb-06 30-Jun-08 29-Jun-29 Wattle Dam Wattle Dam Coolgardie Coolgardie P15/4381 P15/4444 North Widgie North Widgie North Widgie North Widgie North Widgie North Widgie North Widgie Coolgardie Coolgardie Coolgardie Coolgardie Coolgardie Coolgardie Coolgardie M15/97 M15/99 M15/100 M15/101 M15/102 M15/653 M15/1271 Granted Granted Granted Granted Granted Granted Granted Granted Granted 5-May-00 2-Feb-01 9-Jan-01 5-May-06 9-Dec-83 9-Dec-83 9-Dec-83 9-Dec-83 9-Dec-83 20-Nov-92 7-Dec-98 26-Jul-84 26-Jul-84 26-Jul-84 26-Jul-84 11-Apr-85 29-Jan-93 7-Feb-07 8-Jan-05 4-May-10 25-Jul-26 25-Jul-26 25-Jul-26 25-Jul-26 10-Apr-27 28-Jan-14 6-Feb-28 Larkinville Coolgardie E15/689 Granted 2-Jun-00 20-Apr-05 19-Apr-10 Larkinville Coolgardie E15/742 Granted 26-Oct-01 20-Apr-05 19-Apr-10 Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius 100% & 80% of Ni Rights 100% & 80% of Ni Rights 100% & 80% of Ni Rights 100% & 80% of Ni Rights 100% & 80% of Ni Rights 100% & 80% of Ni Rights 100% & 80% of Ni Rights 100% & 80% of Ni Rights M15/1474 100% 100% Ramelius Ramelius Ramelius Ramelius was P15/3666 Gold Rights Gold Rights Gold Rights Gold Rights Gold Rights Gold Rights Gold Rights ANM ANM ANM ANM ANM ANM ANM Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius Ramelius 75% & 80% Ramelius Ni Rights Ramelius & Pioneer & Pioneer 75% & 80% Ramelius Ni Rights Ramelius & Pioneer & Pioneer 07 REVIEW OF OPERATIONS Project Location Tenement Status Application Date Grant Date Expiry Date Associated Tenement ID Acquiring % Acquired % Registered Beneficial Owner Owner Larkinville Coolgardie E15/896 Granted 13-Jul-05 9-Jan-07 8-Jan-12 Larkinville Coolgardie E15/1039 Granted 3-Sep-07 13-Mar-09 12-Mar-14 75% & 80% Ni Rights 75% & 80% Ni Rights Pioneer Pioneer Ramelius & Pioneer Ramelius & Pioneer Larkinville Larkinville Coolgardie E15/1062 Granted 8-Feb-08 3-Dec-08 2-Dec-13 100% Ramelius Ramelius Coolgardie M15/1449 Application 9-Mar-04 P15/4213- 4214 75% & 80% Ramelius Ni Rights Ramelius & Pioneer & Pioneer Larkinville Coolgardie P15/4213 Granted 17-Feb-99 28-Mar-00 27-Mar-04 M15/1449 Larkinville Coolgardie P15/4214 Granted 17-Feb-99 28-Mar-00 27-Mar-04 M15/1449 Larkinville Coolgardie P15/4765 Application 17-Jan-06 Larkinville Coolgardie P15/4790 Granted 19-Apr-06 14-Aug-07 13-Aug-11 Larkinville Coolgardie P15/4904 Application 22-Jan-07 Larkinville Coolgardie P15/4905 Application 22-Jan-07 M15/1449 M15/1449 75% & 80% Ramelius Ni Rights Ramelius & Pioneer & Pioneer 75% & 80% Ramelius Ni Rights Ramelius & Pioneer & Pioneer 75% & 80% Ni Rights Pioneer Ramelius & Pioneer 75% & 80% Ramelius Ni Rights Ramelius & Pioneer & Pioneer 75% & 80% Ramelius Ni Rights Ramelius & Pioneer & Pioneer 75% & 80% Ramelius Ni Rights Ramelius & Pioneer & Pioneer Larkinville Coolgardie P15/5185 Granted 25-May-07 11-Apr-08 10-Apr-12 100% Ramelius Ramelius Eucalyptus Mt Margaret M39/803 Granted 15-Aug-00 22-May-08 21-May-29 Eucalyptus Mt Margaret M39/804 Granted 15-Aug-00 22-May-08 21-May-29 50% of Gold Rights 50% of Gold Rights NiWest NiWest NiWest NiWest Groundlark Coolgardie M15/1290 Granted 29-Jun-99 25-Oct-02 24-Oct-23 100% Ramelius Ramelius Eagles Nest Coolgardie M15/1475 Granted 12-Jul-04 29-Sep-04 28-Sep-25 100% Ramelius Ramelius Burbanks Coolgardie M15/1273 Granted 16-Dec-98 30-Mar-99 29-Mar-20 Burbanks Coolgardie M15/1369 Granted 22-May-01 31-Dec-01 30-Dec-22 Burbanks Coolgardie M15/1370 Granted 22-May-01 31-Dec-01 30-Dec-22 Burbanks Coolgardie P15/5269 Granted 19-May-08 29-Jun-09 28-Jun-13 Burbanks Coolgardie G15/10 Granted 22-Mar-91 20-May-92 19-May-13 Burbanks Coolgardie G15/11 Granted 22-Mar-91 20-May-92 19-May-13 Burbanks Coolgardie G15/12 Granted 22-Mar-91 20-May-92 19-May-13 Burbanks Coolgardie G15/13 Granted 22-Mar-91 20-May-92 19-May-13 Burbanks Coolgardie L15/109 Granted 3-Jul-89 22-Jun-90 21-Jun-10 Burbanks Coolgardie L15/110 Granted 3-Jul-89 22-Jun-90 21-Jun-10 Burbanks Coolgardie L15/189 Granted 10-Mar-94 21-Jun-94 20-Jun-14 Burbanks Coolgardie L15/234 Granted 31-Jan-02 27-Nov-03 26-Nov-24 Burbanks Coolgardie L15/284 Granted 21-Sep-07 25-May-09 24-May-30 08 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd Ramelius Milling Services Pty Ltd REVIEW OF OPERATIONS Royalty Interests The Current status of the Company’s Royalty Interests is as follows: Project Name SANDSTONE* – Gold BULONG* – Gold SPARGOS REWARD* – Gold Location Tenement East Murchison Various Current Holder Nature of Ramelius’ Royalty Troy Resources NL Production based Royalty Capped at $300,000 East Coolgardie Various Yilgarn Gold Ltd Production based Royalty Not Capped Coolgardie Various Breakaway Resources Ltd 3% Gross Gold Royalty SIBERIA* – Gold/Nickel Broad Arrow Various Siberia Mining Corp Ltd EDJUDINA* – Gold Mt Margaret Various Saracen Mineral Holdings Ltd EUCALYPTUS* – Nickel Mt Margaret M39/803, M39/804 GME Resources Ltd Nickel and Gold Royalty Collectively capped at $100,000 Production based Royalty Capped at $500,000 Option to purchase on commencement of mining Nickel Laterites at $0.10/tonne of Proven Ore. Comments No Current Activity by Holder on the Royalty Tenements No Current Activity by Holder on the Royalty Tenements No Current Mining Activity by Holder on the Royalty Tenements No Current Activity by Holder on the Royalty Tenements Currently Subject to Proposed Development No Current Activity by Holder on the Royalty Tenements PARKER RANGE – All minerals Yilgarn E77/1403, P77/3764-5, P77/3481 Cazaly Iron Pty Ltd Royalty of 1% of value of minerals produced capped at $500,000. No Current Activity by Holder on the Royalty Tenements * These royalty assets have been impaired and their carrying costs written off. 09 NATIVE TITLE STATEMENT Exploration and mining areas held by the Company may be subject to issues associated with Native Title. Whilst it is not appropriate to comment in any detail upon specific negotiations with Native Title parties, the directors of Ramelius believe it is important to state the Company’s policy and approach to Native Title and dealings with indigenous communities. The directors believe that the following Native Title policy statement summarises the Company’s desire to develop a spirit of cooperation in its dealings with indigenous people, create goodwill, mutual awareness and understanding and most importantly, respect and commitment. Recognition and Respect Ramelius recognises Aboriginal regard for land and respects their culture, traditions and cultural sites. Understanding and Trust Ramelius listens to Aboriginal community representatives in order to understand their views and beliefs. Recognising that communities may not be fully appreciative of how the Company’s business and industry operates, Ramelius works towards increasing their understanding, respect and trust and to promote the Company’s obligations and economic constraints amongst indigenous communities. Ramelius ensures that its employees and contractors approach the Company’s activities at local sites with respect and a clear understanding of important issues and priorities. Communication and Commitment Ramelius adopts practical measures to develop trust. Acknowledging that community leaders and representatives have an obligation to consult its people in order to determine their opinions and wishes and that this may often not be achieved as quickly as is desired, Ramelius uses its best endeavours to expedite the process and ensure that its commercial interests are not adversely impacted. The Company also uses its best endeavours to ensure reasonable rights of consultation and continued access to land are facilitated and the integrity of land is preserved. The Company is committed to taking appropriate steps to identify and reduce the effects of any unforseen impacts from its activities. Achievements During the year, Ramelius made production related payments to both the Widji People and the Central West Goldfields People and continued its business development arrangements with the Widji People. Acknowledgement The directors of Ramelius publicly acknowledge the continued co-operation and goodwill shown by the Widji and Central West Goldfields People and their representatives in the course of their interactions with the Company during the year. 10 CORPORATE GOVERNANCE STATEMENT Part A: Introduction A1. The Board of Directors are responsible for the overall Corporate Governance of the Company including strategic direction, management goal setting and monitoring, internal control, risk management and financial reporting. In discharging this responsibility, the Board seeks to take into account the interests of all key stakeholders of the Company, including shareholders, employees, customers and the broader community. A2. As a listed entity, Ramelius Resources Limited is required to adhere to the ASX Listing Rules of the Australian Securities Exchange. This includes the requirement to annually report the extent to which the entity has followed the Corporate Governance Recommendations published by the ASX Corporate Governance Council (“ASXCGC”). The recommendations are based on eight core principles of best practice for corporate governance which are not intended to be prescriptions to be followed by all ASX listed companies, but rather guidelines designed to produce an outcome that is effective and of high quality and integrity. In considering corporate governance practices, the Board is mindful of the recognition by the ASXCGC that a “one size fits all” approach to Corporate Governance is not required. Instead, the ASXCGC states suggestions for best practice designed to optimise corporate performance and accountability in the interests of shareholders and the broader economy. A company may consider that a recommendation is inappropriate to its particular circumstances and has flexibility not to adopt it and explain why. A3. Except for those specifically identified and disclosed below, the Company has not to date adopted all ASXCGC best practice recommendations because the Board believes it cannot justify the necessary cost given the size and stage of the entity’s life as a public listed exploration company. The Board is, nevertheless, committed to ensuring that appropriate Corporate Governance practices are in place for the proper direction and management of the Company. This statement outlines the main Corporate Governance practices of the Company disclosed under the principles outlined by the ASXCGC, including those that comply with best practice and which unless otherwise disclosed, were in place during the whole of the financial year ended 30 June 2009. Summary of Corporate Governance Principles and Recommendations Reference Principle 1 – Lay solid foundations for management and oversight 1.1 Establish the functions reserved to the Board and those delegated to senior executives and disclose those functions. B4, B6, B8, B18, B20 1.2 Disclose the process for evaluating the performance of senior executives. B9 1.3 Provide the information indicated in the Guide to reporting on Principle 1. B11, B66 Principle 2 – Structure the Board to add value 2.1 A majority of the Board should be independent directors. 2.2 2.3 The chair should be an independent director. The roles of the chair and chief executive officer should not be exercised by the same individual. 2.4 The board should establish a nomination committee. 2.5 Disclose the process for evaluating the performance of the board, its committees and individual directors. 2.6 Provide the information indicated in the Guide to reporting on Principle 2. B14 B12, B14 B15 B7 B11 B11, B12, B13, B14, B16, B17, B66 Principle 3 – Promote ethical and responsible decision making 3.1 Establish a code of conduct and disclose the code or summary of the code as to: • The practices necessary to maintain confidence in the company’s integrity; • The practices necessary to take into account their legal obligations and the B22, B23 reasonable expectations of their stakeholders; • The responsibility and accountability of individuals for reporting and investigating reports of unethical practices. 11 CORPORATE GOVERNANCE STATEMENT 3.2 Establish a policy concerning trading in company securities by directors, B26, B27 senior executives and employees, and disclose the policy or a summary of that policy. 3.3 Provide the information indicated in the Guide to reporting on Principle 3. Principle 4 – Safeguard integrity in financial reporting 4.1 The board should establish an audit committee. 4.2 The audit committee should be structured so that it: • Consists only of non-executive; • Consists of a majority of independent directors; • • Has at least three members. Is chaired by an independent chair, who is not chair of the board; 4.3 The audit committee should have a formal charter. 4.4 Provide the information indicated in the Guide to reporting on Principle 4. B66 B25 B12, B14, B29, B34 B30 B12, B13, B34, B36, B66 Principle 5 – Making timely and balanced disclosure 5.1 Establish written policies designed to ensure compliance with ASX Listing Rules disclosure requirements and to ensure accountability at senior executive level for that compliance and disclose those policies or a summary of those policies. B38 5.2 Provide the information indicated in the Guide to reporting on Principle 5. B37, B66 Principle 6 – Respect the rights of shareholders 6.1 Design a communications policy for promoting effective communication with B39 shareholders and encouraging their participation at general meetings and disclose the policy or a summary of the policy. 6.2 Provide the information indicated in the Guide to reporting on Principle 6. B40, B66 Principle 7 – Recognise and manage risks 7.1 Establish policies for the oversight and management of material business risks B41, B42 and disclose a summary of those policies. 7.2 7.3 The Board should require management to design and implement the risk management and internal control system to manage the company’s material business risks and report to it on whether those risks are being managed effectively. The board should disclose that management has reported to it as to the effectiveness of the company’s management of its material business risks. The Board should disclose whether it has received assurance from the chief executive officer (or equivalent) and chief financial officer (or equivalent) that the declaration provided in accordance with section 295A of the Corporations Act is founded on a sound system or risk management and internal control and that the system is operating effectively in all material respects in relation to financial reporting risks. B42 B44 7.4 Provide the information indicated in the Guide to reporting on Principle 7. B44, B66 12 CORPORATE GOVERNANCE STATEMENT Principle 8 – Remunerate fairly and responsibly 8.1 The board should establish a remuneration committee. B49 8.2 Clearly distinguish the structure of non-executive director’s remuneration from that of executive directors and senior executives. B48, B50, B56 8.3 Provide the information indicated in the Guide to reporting on Principle 8. B12, B13, B48, B66 Part B: Corporate Governance Disclosure Principle 1 – Lay solid foundations for management and oversight Role of the Board B1. The Board is governed by the Corporations Act 2001, ASX Listing Rules and a formal constitution adopted by the Company in 2002 on its conversion from a proprietary limited company to a public company limited by shares and as subsequently amended by shareholders. B2. The Board’s primary role is the protection and enhancement of long-term shareholder value. B3. The Board takes responsibility for the overall Corporate Governance of the Company including its strategic direction, management goal setting and monitoring, internal control, risk management and financial reporting. In discharging this responsibility, the Board seeks to take into account the interests of all key stakeholders of the Company, including shareholders, employees, customers and the broader community. B4. The Board has adopted a formal Board Charter in accordance with ASXCGC best practice recommendation 1.1. The Board Charter details the functions and responsibilities of the Board of Directors including the Chairman and the Managing Director/Chief Executive Officer of the company. B5. The Board of Directors is responsible for the overall Corporate Governance of the Company. The Board overviews the formulation of strategies and participates in setting objectives for the Company and the establishment of policies to be implemented by management. The Board monitors the activities of the Company and ensures the entity is accountable to external stakeholders. B6. The Board’s responsibilities are extensive and include the following: • Determining the size and composition of the Board of Directors, remuneration of directors (subject to the maximum aggregate amount as approved from time to time by the company in general meeting) and assessing the effectiveness of individual directors and the Board as a whole; • Establishing committees of the Board and determining terms of reference and reporting requirements; • Selecting and appointing (and where appropriate, removing) the Chief Executive, determining conditions of service including remuneration and reviewing performance against key objectives; • Ratifying the appointment (and where appropriate, removal) of senior management including the Chief Financial Officer and Company Secretary and approving conditions of service including remuneration and performance monitoring; • Reviewing senior management succession planning and development; • Approving strategic directions and performance objectives for the Company and monitoring implementation by management; • Ensuring adequate financial, and human resources are available to achieve the Company’s objectives; • Delegating appropriate levels of authority to management; • Overseeing the activities of the Company and ensuring effective systems of audit, risk management and internal controls are in place to protect the entity’s assets and minimise operations beyond legal and regulatory requirements or acceptable risk thresholds; • Monitoring compliance with legal and other regulatory requirements including accounting standards, continuous disclosure and ASX Listing Rules; • Approving and monitoring financial budgets, capital management, major expenditures and significant acquisitions and divestments; • Approving and monitoring financial and other reporting; • Approving and monitoring appropriate policies, procedures, codes of conduct and ethical standards for directors and employees; • Ensuring effective communication and reporting to shareholders and other key stakeholders of the Company. 13 CORPORATE GOVERNANCE STATEMENT Board processes and management B7. The Board has an established framework for the management of the entity including a system of internal control, a business risk management process and appropriate ethical standards. To assist in the execution of its responsibilities, the Board has an Audit Committee to deal with internal control, ethical standards and financial reporting. The Audit Committee’s role and responsibilities, composition, structure and membership are set out in In August 2008 the Board established a Remuneration Committee to deal executive a formal Charter. performance, remuneration, recruitment, retention and termination policies for senior management and incentive schemes. In August 2009 the Committee was renamed the Nomination and Remuneration Committee. B8. The Board appoints a Managing Director/Chief Executive Officer responsible for the day to day management of the Company. The role of the Managing Director is documented in the Board Charter (refer Principle 2 below). Performance Evaluation B9. The Nomination and Remuneration Committee evaluates the performance of the Managing Director/Chief Executive Officer, Chief Financial Officer/Company Secretary and other senior executives on a regular basis and makes recommendations to the Board on any performance related remuneration matters. The Board encourages continuing professional development of senior executives and other employees. The Company’s remuneration practices are disclosed in the Remuneration Report section of the Directors Report. B10. The Nomination and Remuneration Committee’s responsibilities include the following: • Evaluating the necessary and desirable competencies for members of the Board of Directors; • Assessing skills, experience and expertise and making recommendations to the Board on candidates for appointment and re-appointment as directors on the Board; • Reviewing and making recommendations on processes for evaluating the performance of members of the Board and its Committees and for assessing and enhancing director competencies; • Reviewing and monitoring progress of succession plans and making recommendations to the Board; • Reviewing and making recommendations to the Board on the remuneration of the Managing Director/CEO; • Reviewing and making recommendations to the Board, on advice from the Managing Director/CEO, on remuneration of senior executives of the Company (other than the Managing Director/CEO) and in respect of remuneration matters generally; • Evaluating and making recommendations to the Board on the Company’s recruitment, retention and termination policies and procedures; • Assessing and making recommendations to the Board on remuneration policies and practices including superannuation arrangements, incentive schemes and performance targets for senior executives and other employees of the Company. • Reviewing and assessing annually the performance of the Committee and the adequacy of its charter. B11. A performance evaluation for the Board and its members is conducted by the Chairman on an informal basis as considered necessary. There was no performance evaluation of the Board undertaken during the 2009 financial year because this was planned for completion by December 2009. Performance evaluations for relevant senior executives were undertaken by the remuneration committee during the 2009 financial year in accordance with the Company’s performance evaluation process. Principle 2 – Structure the Board to add value Composition of the Board B12. The names of the directors of the Company and terms in office at the date of this Statement together with their skills, experience and expertise are set out below. The directors’ terms in office are considered appropriate in light of the fact that the Company was a dormant company prior to its ASX listing in March 2003. Robert Michael Kennedy Non-Executive Chairman - ASAIT, Grad, Dip (Systems Analysis), FCA, ACIS, Life member AIM, FAICD. Mr Kennedy joined Ramelius Resources Limited on 1 November 1995 as a non-executive chairman. He is a chartered accountant and a consultant to Kennedy & Co, Chartered Accountants, a firm he founded. He is also a director of ASX listed companies Beach Petroleum Limited (since 1991), Flinders Mines Limited (since 2001), Maximus Resources Limited (since 2004), Monax Mining Ltd (since 2004), Eromanga Uranium Limited (since 14 CORPORATE GOVERNANCE STATEMENT 2006), and Marmota Energy Limited (since 2007). His special responsibilities include membership of the Audit Committee and the Nomination & Remuneration Committee. Mr Kennedy brings to the Board his expertise in finance and management consultancy and extensive experience as chairman and non-executive director of a range of listed public companies including in the resources sector. Mr Kennedy leads the development of strategies for the development and future growth of the Company. Reginald George Nelson Non-Executive Director - BSc, Hon Life Member Society of Exploration Geophysicists, FAusIMM, FAICD. Mr Nelson joined Ramelius Resources Limited as a non-executive director on 1 November 1995. He has had a career spanning nearly four decades as an exploration geophysicist in the minerals and petroleum industries. He was chairman of the peak industry organisation, the Australian Petroleum Production and Exploration Association (APPEA) from 2004 to 2006 and remains a member of its Council. He is a former Chairman of the Nevoria Gold Mine Joint Venture in Western Australia. He has broad experience in gold exploration and mining operations in Western Australia, the Northern Territory and South Australia. He is also a director of ASX listed companies, Beach Petroleum Limited (since 1992), Monax Mining Ltd (since 2004) and Marmota Energy Limited (since 2007). His special responsibilities include Chairmanship of the Audit Committee and the Nomination & Remuneration Committee. Mr Nelson’s contribution to the Board is his wide technical expertise and knowledge of the mining industry and corporate matters. Ian James Gordon Executive Director and Chief Executive Officer - B.Com, MAICD. Mr Gordon joined Ramelius Resources Limited as an executive director on 18 October 2007. He has more than 20 years experience in the resources industry in gold, diamonds and base metals. He has held management positions with Rio Tinto Exploration Pty Ltd, Gold Fields Australia Pty Ltd and Delta Gold Limited. He was a director of ASX listed company, Glengarry Resources Limited (2004 to 2005). His special responsibilities relate to directing the exploration program and development of the Wattle Dam gold mine. Mr Gordon’s contribution to the Board is his broad experience in gold exploration and mining operations in Australia and knowledge of industry issues is directed towards expanding and strengthening the future growth of the Company. Joseph Fred Houldsworth Non-Executive Director Mr Houldsworth joined Ramelius Resources Limited as an executive director on 18 February 2002 and was Managing Director and Chief Executive Officer until 31 July 2009. He has extensive practical experience in the resource industry having worked in the mining and exploration industry for more than 30 years at both operational and management levels primarily in the Western Australian Goldfields. He was instrumental in turning around the troubled Nevoria Gold Mine in 1993 and is a former consultant for 10 years to insolvency specialists on both mining and exploration. Mr Houldsworth’s contribution to the Board is his considerable experience and knowledge of the mining industry and as the former chief executive of the company as well as his background in asset management for various mining entities. Kevin James Lines Non-Executive Director - BSc (Geology), MAusIMM. Mr Lines joined Ramelius Resources Limited as a non-executive director on 9 April 2008. He has over 25 years experience in mineral exploration and mining for gold, copper, lead/zinc and tin. He has held senior geological management positions with Newmont Australia Limited, Normandy Mining Limited and the CRA group of companies. He was the foundation Chief Geologist at Kalgoorlie Consolidated Gold Mines where he led the team that developed the ore-body models and geological systems for the Super-Pit Operations in Kalgoorlie, managed the Eastern Australian Exploration Division of Newmont Australia that included responsibility for the expansive tenement holdings of the Tanami region. He is also managing director of ASX listed company, Eromanga Uranium Limited (since 2006). Mr Line’s contribution to the Board is his extensive experience in the assessment and evaluation of exploration projects and development of properties and mining operations overseas. 15 CORPORATE GOVERNANCE STATEMENT B13. The Company held 22 meetings of directors (including committees of directors) during the financial year. The number of directors’ meetings and number of meetings attended by each of the directors of the Company (including committees of directors) during the financial year were as follows: Directors’ Meetings Audit Committee Meetings Nomination & Remuneration Committee Meetings Number Eligible to attend Number Attended Number Eligible to attend Number Attended Number Eligible to attend Number Attended Director Robert Michael Kennedy Reginald George Nelson Joseph Fred Houldsworth 1 Ian James Gordon 1 Kevin James Lines 1 17 17 17 17 17 17 17 17 17 17 3 3 N/A N/A N/A 3 3 N/A N/A N/A 2 2 N/A N/A N/A 2 2 N/A N/A N/A 1 Messrs Houldsworth, Gordon and Lines are not members of the Audit Committee or the Nomination & Remunera- tion Committee. B14. The composition of the Board currently consists of five directors, Mr RM Kennedy (Chairman), Mr RG Nelson, Mr JF Houldsworth, Mr KJ Lines and Mr IJ Gordon. Apart from Mr Gordon (Chief Executive Officer), all other directors including the Chairman, are non-executives. Although the composition of the Board is comprised of a majority of non-executive directors, the majority of the Board is however not regarded as meeting the criteria of being independent because two of the non-executive directors (Messrs Kennedy and Nelson) are officers of a substantial shareholder of the Company and Mr Houldsworth was Managing Director until July 2009. One director (Mr Lines) meets the independent director criteria contained in ASXCGC best practice recommendation 2.1. Notwithstanding the criteria set out in best practice recommendation 2.1, the Board considers that all non- executive directors act independent from any conflict of interest and in the best interests of stakeholders because all directors are required to disclose any conflict or material interest in any matter being considered by the Board in accordance with the provisions of the Section 191 of the Corporations Act. B15. Mr Kennedy’s role as Chairman of the Board is separate from that of the Managing Director/Chief Executive Officer, Mr Houldsworth (until 31 July 2009)/Mr Gordon (since 1 August 2009) who is responsible for the day to day management of the Company and is in compliance with the ASXCGC best practice recommendation 2.3 that these roles not be exercised by the same individual. B16. The Company’s constitution specifies the number of directors must be at least three and at most ten. The Board may at any time appoint a director to fill a casual vacancy. Directors appointed by the Board are subject to election by shareholders at the following annual general meeting and thereafter directors (other than the Managing Director) are subject to re-election at least every two years. The tenure for executive directors is linked to their holding of executive office. B17. Formal deeds were entered into by the Company with directors whereby all directors are entitled to take such legal advice as they require at any time and from time to time on any matter concerning or in relation to their rights, duties and obligations as directors in relation to the affairs of the Company. B18. The Board Charter details the roles of the Chairman and Managing Director as follows. 16 CORPORATE GOVERNANCE STATEMENT Role of the Chairman B19. The role of Chairman is non executive and central to the effective corporate governance of the Company. The in ensuring effective Chairman leads the Board and General Meetings of the Company and is instrumental communications exist between the Board of Directors and senior management. The Chairman is also responsible for the following: • Ensuring the Company has an effective Board and that there are appropriate procedures in place to evaluate the performance of the Board as a whole, its individual directors and committees; • Ensuring that meetings of the Board are conducted efficiently and effectively and that the quality of agenda and Board papers properly inform directors on the operations of the Company so as to facilitate effective review, analysis, discussion and decision making by directors; • Promoting high standards of integrity and ethics; • Establishing and maintaining a close working relationship with the Managing Director/Chief Executive Officer and providing ongoing support and advice; • Overseeing communications with shareholders and other key stakeholders and representing the Board of Directors as required. Role of the Managing Director/Chief Executive Officer B20. The role of the Managing Director/Chief Executive Officer is separate from the Chairman and is appointed by the non executive directors of the Board. The responsibilities of the Managing Director/Chief Executive Officer include the following: • Recommending strategic directions and implementing business plans approved by the Board; • Managing the day to day operations of the Company including its financial, physical and human resources; • Developing and implementing risk management procedures; • Developing and implementing internal control and regulatory compliance policies and procedures; • Providing timely, accurate and relevant information to the Board. Principle 3 – Promote ethical and responsible decision making Ethical standards B21. The Company aims to a high standard of corporate governance and ethical conduct by directors and employees. B22. The Company has a Policy Manual which contains a code of conduct that provides guidance to employees regarding expected standards of behaviour, ethics and integrity as a condition of their employment. B23. The Company’s code of conduct requires Directors and officers to: • act in good faith and in the best interests of the Company; • exercise care and diligence that a reasonable person in that role would exercise; • exercise their powers in good faith for a proper purpose and in the best interests of the Company; • not improperly use their position or information obtained through their position to gain a personal advantage or for the advantage of another person to the detriment of the Company; • disclose material personal interests and avoid actual or potential conflicts of interests; • keep themselves informed of relevant Company matters; • keep confidential the business of all directors meetings; and • observe and support the Board’s Corporate Governance practices and procedures. B24. All directors have signed deeds with the Company which require them to provide the Company with details of all securities registered in the director’s name or an entity in which the director has a relevant interest within the meaning of section 9 of the Corporations Act 2001 and details of all contracts, other than contracts to which the Company is a party to which the director is a party or under which the director is entitled to a benefit, and that confer a right to call for or deliver shares in the Company and the nature of the director’s interest under the contract. 17 CORPORATE GOVERNANCE STATEMENT B25. Directors are required to disclose to the Board any material contract in which they may have an interest. In accordance with Section 195 of the Corporations Act 2001, a director having a material personal interest in any matter to be dealt with by the Board, will not be present when that matter is considered by the Board and will not vote on that matter. Trading in the Company’s Securities B26. The Company has a policy whereby directors, officers and employees are not permitted to trade in securities of the Company at any time whilst in possession of price sensitive information not readily available to the market. Section 1043A of the Corporations Act 2001 also prohibits the acquisition and disposal of securities where a person possess information that is not generally available and which may reasonably be expected to have a material effect on the price of the securities if the information was generally available. B27. In addition the Board has approved a formal policy regarding notification of Directors’ interests in securities of the Company and contracts. Principle 4 – Safeguard integrity in financial reporting CEO/CFO declarations on financial reports B28. The Chief Executive Officer and Chief Financial Officer are required to provide written declarations to the Board stating that in their opinions the Company’s annual financial reports present a true and fair view, in all material respects, of the Company’s financial position and financial performance are in accordance with relevant accounting standards. Audit Committee B29. Ramelius is not a Company required by ASX Listing Rule 12.7 to have an Audit Committee during the year although it is a best practice recommendation of the ASXCGC. Notwithstanding the Listing Rule requirement, the Company has established an Audit Committee in accordance with ASXCGC best practice recommendation 4.1 to oversee the Company’s internal controls, ethical standards, financial reporting, and external accounting and compliance procedures. B30. The Board has adopted a formal Charter for the Audit Committee in accordance with ASXCGC best practice recommendation 4.3. The Charter details the Audit Committee’s role and responsibilities, composition and membership requirements. The role of the Chairman of the Audit Committee is also detailed in the Charter. B31. The Audit Committee is generally responsible for the integrity of the Company’s financial reporting and overseeing the performance and independence of the external auditor. B32. Members of the Audit Committee have full rights to access all information and records of the Company and to discuss any matter with the external auditor and senior management. The Committee also has the right to seek external professional advice at the cost of the Company. B33. The Audit Committee’s responsibilities are as follows: • Overseeing establishment, maintenance and reviewing the effectiveness of the Company’s internal control and ensuring efficacy and efficiency of operations, reliability of financial reporting and compliance with applicable Accounting Standards, Regulations and ASX Listing Rules; • Reviewing, assessing and making recommendations to the Board on the annual and half year financial reports and other financial information or formal announcements published or released by the Company; • Assessing and ensuring that any significant transactions and related party dealings are properly recognised, recorded and disclosed in the Company’s financial reports; • Obtaining and reviewing statements from the Chief Executive Officer and Chief Financial Officer expressing opinions on whether the Company’s financial records have been properly maintained and whether financial statements comply with accounting standards and present a true and fair view; • Reviewing the effectiveness of the Company’s risk management and internal compliance systems; • Approving and monitoring appropriate policies, procedures, codes of conduct and ethical standards for directors and employees and receiving and assessing management reports on any deficiencies or weaknesses that may arise; • Liaising and discussing any relevant issues with the Chief Executive Officer and Chief Financial Officer; 18 CORPORATE GOVERNANCE STATEMENT • Assessing the scope of the annual audit and half year review, ensuring emphasis is placed on any areas requiring special attention; • Liaising with and reviewing all reports of the external auditor including audit reports, management letters and independence declarations; • Reviewing performance and assessing independence of the external auditor having regard for the provision of any non audit services and where necessary, making recommendations relating to audit fees, selection process, appointment, and removal of the Company’s external auditor; • Obtaining and reviewing statements confirming the external auditor’s independence; • Reviewing and monitoring management’s response to any significant external auditor findings and recommendations; • Reporting generally to the Board on the activities of the Committee and making any necessary recommendations relating to areas of improvement; • Reviewing the contents of statements to be included in the annual report on the activities of the Committee; • Ensuring effective communication and reporting of the role of the Committee to shareholders and other key stakeholders of the Company; • Reviewing and assessing annually the performance of the Committee and the adequacy of this Charter. B34. The Audit Committee currently consists of the two non-executive Board directors, Messrs Kennedy & Nelson, and is chaired by Mr Nelson. Mr Kennedy is a qualified Chartered Accountant. Details of these directors’ qualifications and attendance at meetings are set out in the Directors’ Report section of this report. The Audit Committee currently consist of less than three members and does not have a majority of independent directors including an independent Chairman. The members of the Committee are not regarded as being independent according to the criteria set out in the ASXCGC best practice recommendations because they are officers of a substantial shareholder of the Company. Notwithstanding the criteria set out in best practice recommendation 2.1 regarding independence, the Board considers that all members of the Committee act independent from any conflict of interest and in the best interests of stakeholders because all directors are required to disclose any conflict or material interest in any matter being considered by the Committee in accordance with the provisions of the Section 191 of the Corporations Act. Nevertheless, notwithstanding that the Company is not required to have an Audit Committee by ASX Listing Rule 12.7, the Audit Committee established by the Board is in partial compliance with ASXCGC best practice recommendation 4.2 in that it consists of only non-executive directors with a Chairman who is not the Chairman of the Board. The Board considers the current composition of the Audit Committee is appropriate given the current composition and size of the Board of Directors. B35. The role of Chairman is non executive and central to the effectiveness of the Audit Committee and its contribution to the Board’s overall responsibility for the Corporate Governance of the Company. The Chairman leads the Committee and its meetings and is instrumental in ensuring effective communications exist between the Committee and the Board of Directors, senior management and external auditor. The Chairman is also responsible for the following: • Ensuring the Audit Committee has appropriate procedures in place to evaluate the performance and effectiveness of the Committee as a whole and its individual Members; • Ensuring that meetings of the Audit Committee are conducted efficiently and effectively and that the quality of agendas and papers properly inform Members on matters before the Committee that facilitates effective review, analysis, discussion and decision making by Members of the Committee; • Promoting high standards of integrity and ethics; • Maintaining a close working relationship with the Managing Director/Chief Executive Officer, senior management and external auditor so as to facilitate an effective flow of relevant and appropriate information to the Committee; • Ensuring that the Board is kept informed on all matters relating to the activities of the Committee and overseeing any communications concerning its activities with shareholders and other key stakeholders. B36. The Committee meets at least two times per annum and reports to the Board. The Managing Director/Chief Executive Officer, Chief Financial Officer and external auditor may by invitation attend meetings at the discretion of the Committee. 19 CORPORATE GOVERNANCE STATEMENT Principle 5 – Making timely and balanced disclosure Continuous Disclosure B37. The Company operates under the continuous disclosure requirements of the ASX Listing Rules and ensures that all information which may be expected to affect the value of the Company’s securities or influence investment decisions is released to the market in order that all investors have equal and timely access to material information concerning the Company. The information is made publicly available on the Company’s website following release to the ASX. B38. Although the Company has a procedure in place to promote timely disclosure of material information, proper vetting and authorisation of announcements that are factual and properly presented, such procedures have only been summarised and not formally documented in detail. The Board does not consider this to have impeded compliance with the continuous compliance requirements of the ASX Listing Rules given the size of the Company. Principle 6 – Respect the rights of shareholders The Role of Shareholders B39. The Board aims to ensure that shareholders are informed of all major developments affecting the Company’s state In accordance with the ASXCGC best practice recommendation 6.1, information is communicated to of affairs. shareholders as follows: • the annual financial report which includes relevant information about the operations of the Company during the year, changes in the state of affairs of the entity and details of future developments, in addition to the other disclosures required by the Corporations Act 2001; the half yearly financial report lodged with the Australian Securities Exchange and thereby the Australian Securities and Investments Commission and sent to all shareholders who request it; • • notifications relating to any proposed major changes in the Company which may impact on share ownership rights that are submitted to a vote of shareholders; • notices of all meetings of shareholders; • publicly released documents including full text of notices of meetings and explanatory material made available on the Company’s internet web-site at www.rameliusresources.com.au and sent by email to shareholders who request to receive such information electronically; and • disclosure of the Company’s Corporate Governance practices and communications strategy on the entity’s internet web-site. B40. The Board encourages full participation of shareholders at the Annual General Meeting to ensure a high level of accountability and identification with the Company’s strategy and goals. Important issues are presented to the shareholders as single resolutions. In accordance with ASXCGC best practice recommendations, the external auditor of the Company is also invited to the Annual General Meeting of shareholders and is available to answer any questions concerning the conduct, preparation and content of the auditor’s report. Pursuant to section 249K of the Corporations Act 2001 the external auditor is provided with a copy of the notice of meeting and related communications received by shareholders. Principle 7 – Recognise and manage risks Risk Assessment and Management B41. The Board recognises that there are inherent risks associated with the Company’s operations including mineral exploration and mining, environmental, title and native title, legal and other operational risks. The Board endeavours to mitigate such risks by continually reviewing the activities of the Company in order to identify key business and operational risks and ensuring that they are appropriately assessed and managed. The Board of Directors believe that consistent with the operations of the Company, its key stakeholders, principally shareholders, are willing to accept a higher level of risk than may otherwise be expected with other listed companies in return for higher potential rewards. Nevertheless, the Directors consider that there is value in formalising a process for monitoring material business risks in order to assist it with its overall responsibility for mitigating such risks. 20 CORPORATE GOVERNANCE STATEMENT B42. The Board has approved a policy manual the contents of which assists with risk mitigation, oversight and management. However the Board has not to date requested management to formally design and implement a risk management and internal control system to manage the entity’s material business risks because the Board considers the size of the Company renders the costs associated with this to be prohibitive. Consequently management does not currently report to the Board against a formal risk management and internal control system. Notwithstanding this, the Company has during the year commenced and is currently in the process of reviewing its risk management system. B43. Although the Board recognises its ultimate responsibility for risk management and oversight, in discharging its duties, considerable reliance is placed on information provided by management to mitigate material business risks. Ramelius does not have a separate Risk Management Committee as the Directors do not consider this would be efficient given the size of the Board and in view of the size of the Company and the environment in which it operates. Instead Directors prefer to proactively and continually assess all material business risks as part of the Board’s overall decision making process. Whilst every effort is made by Directors to weigh up material business risks against potential rewards in their decision making process, the Board acknowledges that no process can guarantee elimination of potential material loss. B44. The Chief Executive Officer and Chief Financial Officer are required to declare to the Board in writing that the financial records of the Company for the financial year have been properly maintained in accordance with Section 286 of the Corporations Act 2001 the financial statements and associated notes comply in all material respects with the accounting standards as required by Section 296 of the Corporations Act 2001; and the financial statements and associated notes give a true and fair view, in all material respects, of the financial position as at balance date and performance of the Company for the year as required by Section 297 of the Corporations Act 2001. The declarations were provided to the Board in respect of the 2009 financial year. However these officers are not presently required to state in writing that the integrity of the financial statements are based on a sound system of risk management and internal control because the Board considers the size of the Company renders the costs of implementing such systems and controls prohibitive. Principle 8 – Remunerate fairly and responsibly Remuneration Policy B45. In accordance with ASXCGC best practice recommendations, the Company’s remuneration practices are set out as follows: Remuneration Practices B46. The Company’s policy for determining the nature and amounts of emoluments of board members and Key Management Personnel of the Company is as follows. B47. The Company’s Constitution specifies that the total amount of remuneration of non-executive directors shall be fixed from time to time by a general meeting. The current maximum aggregate remuneration of non-executive directors has been set at $400,000 per annum. Directors may apportion any amount up to this maximum amount amongst the non-executive directors as they determine. Directors are also entitled to be paid reasonable travelling, accommodation and other expenses incurred in performing their duties as Directors. The remuneration of the Managing Director/Chief Executive Officer is determined by the non-executive directors on the Nomination and Remuneration Committee and approved by the Board as part of the terms and conditions of his employment which are subject to review from time to time. The remuneration of other executive officers and employees is determined by the Managing Director/Chief Executive Officer subject to the approval of the Board. B48. Non-executive director remuneration is by way of fees and statutory superannuation contributions. Non- executive directors do not participate in schemes designed for remuneration of executives nor do they receive options or bonus payments and are not provided with retirement benefits other than salary sacrifice and statutory superannuation. 21 CORPORATE GOVERNANCE STATEMENT B49. The Company’s remuneration structure is based on a number of factors including the particular experience and performance of the individual in meeting key objectives of the Company. The Nomination and Remuneration Committee is responsible for assessing relevant employment market conditions and achieving the overall, long term objective of maximising shareholder benefits, through the retention of high quality personnel. In August 2008, a Nomination and Remuneration Committee was established to assist the Board by overseeing remuneration policies and make recommendations to the Board. The Company may also engage external consultants to advise on remuneration policy and to benchmark remuneration of senior executives against comparable entities so as to ensure that remuneration packages are consistent with the market and are appropriate for the organisation. B50. All key management personnel receive a base salary based on factors such as experience, length of service, superannuation and performance incentives. Performance incentives are generally paid once predetermined key performance indicators have been met. Key management personnel receive a statutory superannuation guarantee contribution, however do not receive any other form of retirement benefits. Individuals may elect to salary sacrifice part of their salary to increase payments towards superannuation. On retirement, key management personnel are paid employee benefit entitlements accrued to the date of retirement. B51. To date, the Company has not emphasised payment for results through the provision of cash bonus schemes or other incentive payments based on key performance indicators. However the Nomination and Remuneration Committee may recommend to the Board the payment of cash bonuses from time to time in order to reward individual executive performance in achieving key objectives as considered appropriate by the Nomination and Remuneration Committee. Cash bonuses paid during the financial year are disclosed in the Remuneration Report. B52. All remuneration paid to key management personnel is valued at the cost to the Company and expensed. Employee Incentive Plan B53. The Company has an Employee Share Acquisition Plan and a Performance Rights Plan which have been approved by shareholders in November 2007. The Share Acquisition Plan enables the Board to offer eligible employees as a long-term incentive, ordinary fully paid shares in the Company and in accordance with the terms of the Plan, shares may be offered at no consideration unless the Board determines that market value or some other value is appropriate. Any consideration may be by way of interest free loans repayable in accordance with the terms and conditions of the Plan. The Performance Rights Plan enables the Board to grant Performance Rights (being entitlements to shares in the Company that are subject to satisfaction of vesting conditions) to selected key senior executives as a long-term incentive as determined by the Board in accordance with the terms and conditions of the Plan. B54. The objective of the Share Acquisition Plan is to align the interests of employees and shareholders by providing employees of the Company with the opportunity to participate in the equity of the Company as an incentive to achieve greater success and profitability for the Company and to maximise the long-term performance of the Company. The objective of the Performance Rights Plan is to provide selected senior executives the opportunity to participate in the equity of the Company through the issue of Performance Rights as a long-term incentive that is aligned to the long-term interests of shareholders. B55. During the year ended 30 June 2009 a total of 72,090 shares with a fair value of $39,650 were issued to employees under the Employee Share Acquisition Plan. Performance Based Remuneration B56. Key Management Personnel receive performance based remuneration as considered appropriate by the Nomination and Remuneration Committee and the Board. The intention of this remuneration is to facilitate goal congruence between Key Management Personnel with that of the business and shareholders. B57. The remuneration policy of the Company has been tailored to increase goal congruence between shareholders, directors and senior executives. Two methods have been used to achieve this aim. B58. The first method was the issue of options to Key Management Personnel. During the 2008 financial year a total of 800,000 options (each exercisable at $1.90 by 30 June 2009) with a fair value of $272,000 were issued to certain Key Management Personnel. These options were not exercised and lapsed at expiry. No options were issued to Key Management Personnel during the 2009 financial year. B59. The second method was through a Performance Rights Plan based on Key Performance Indicators (“KPI’s”) set by the Board. The KPI conditions attached to the Performance Rights Plan include a vesting period of three years from grant date (7 April 2008) and a requirement for the Company’s share price to be within the top 40% comparator group of companies as set by the Board. The Companies in the comparator group are as follows. 22 CORPORATE GOVERNANCE STATEMENT Avoca Resources Limited Alkane Resources Limited Apex Minerals NL Barra Resources Limited Bendigo Mining Limited Carrick Gold Limited Citigold Corporation Limited Crescent Gold Limited Dioro Exploration NL Gryphon Minerals Limited Integra Mining Limited Monarch Gold Mining Company Limited Norton Gold Fields Limited Silver Lake Resources Limited Tanami Gold NL Troy Resources NL B60. During the 2008 financial year a total of 900,000 Performance Rights with a fair value of $576,000 were granted under the Performance Rights Plan to selected Key Management Personnel. No Performance Rights were granted during the 2009 financial year. These Rights are recognised on a pro-rata basis over the vesting period. Any Rights that do not vest on the vesting date will lapse. The Rights are subject to performance conditions which are to be tested in future financial periods. B61. The employment conditions of Executive Directors including the Chief Executive Officer and Key Management Personnel are formalised in contracts of employment. During the year the new employment contracts of the former Managing Director, Chief Executive Officer and the Chief Financial Officer/Company Secretary were entered into. The contracts have no fixed term with 3 months and 6 months notice of termination by the executive and Company respectively. Generally, employment contracts of senior executives enable the Company to terminate the contracts without cause by providing written notice or making a termination payment in lieu of notice including a minimum termination payment as provided for under the contracts. However any such termination payments to officers of the Company are subject to the requirements of ASX Listing Rule 10.19, and in the event that the value of termination benefits to be paid and the value of all other termination benefits that are or may be payable to all officers of the Company together exceed 5% of the equity interests of the Company as set out in the latest accounts given to the ASX, the payment shall be pro-rata based on the maximum total termination benefits allowable under ASX Listing Rule 10.19. Termination payments are not generally payable on resignation or dismissal for serious misconduct. Any performance rights or options not vested or exercised before the date of termination will lapse. B62. Details of directors’ and executives/officers’ remuneration, superannuation and retirement payments are set out in the Remuneration Report section of the Directors’ Report. B63. In August 2008 the Board established a Remuneration Committee to deal with executive performance, remuneration, recruitment, retention and termination policies for senior management and incentive schemes. In August 2009 the committee was renamed the Nomination and Remuneration Committee. B64. The Nomination and Remuneration Committee currently consists of the two non-executive Board directors, Messrs Kennedy & Nelson, and is chaired by Mr Nelson. Details of these directors’ qualifications and attendance at meetings are set out in the Directors’ Report section of this report. The Board considers the current composition of the Nomination and Remuneration Committee is appropriate given the current composition and size of the Board of Directors. Products limiting risk B65. The Company has a policy that Directors should not engage in hedge contracts over securities of the company. Corporate Governance Statements B66. Corporate governance statements relating to the following matters are publicly available from the Company’s website at www.rameliusresources.com.au • Functions and responsibilities of the Board, Chairman & Managing Director/Chief Executive Officer; • Board charter; • Audit Committee charter; • Nomination and Remuneration Committee charter; • Code of Conduct; • Trading Policy; • Continuous Disclosure; • Risk oversight and management; • Products limiting risk. 23 GLOSSARY OF TERMS ADSORPTION The attraction of molecules (of gold) in solution to the surface of solid bodies (carbon). BIOTITE A mineral of the mica group widely distributed in a variety of rock types. AEROMAGNETICS A geophysical technique measuring changes in the earth’s magnetic field from an airborne craft. CALCRETE Soil and superficial material cemented by calcium carbonate. AIRCORE A method of rotary drilling whereby rock chips are recovered by air flow returning inside the drill rods rather than outside, thereby providing usually reliable samples. ANOMALOUS A departure from the expected norm. In mineral exploration this term is generally applied to either geochemical or geophysical values higher or lower than the norm. ARCHAEAN The oldest rocks of the Earth’s crust – older than 2,400 million years. AURIFEROUS Gold bearing material AUGER A screw-like boring or drilling tool for use in clay or soft sediments. CARBONATE A common mineral type consisting of carbonates of calcium, iron, and/or magnesium. CHLORITE A representative of a group of micaceous greenish minerals which are common in low grade schists and is also is a common mineral associated with hydrothermal ore deposits. CIL CIRCUIT That part of the gold treatment plant where gold is dissolved from the pulverised rock and subsequently adsorbed onto carbon particles from which the gold is ultimately recovered. COMPANY Ramelius Resources Limited (ACN 001 717 540) COSTEAN A trench dug through soil to expose the bedrock. ASX The Australian Securities Exchange Limited (ACN 008 629 691) CU Copper. AU Gold AZ Azimuth, a surveying term, the angle of horizontal difference, measured clockwise, of a bearing from a standard direction, as from north. BASE METAL Non precious metal, usually referring to copper, zinc and lead. BCM Bank Cubic Metre. Usually refers to the volume of waste measured in situ. CUT A term used when referring to average assays where the grade of a particularly high-grade interval is reduced to a lesser value. DISSEMINATED Usually referring to minerals of economic interest scattered or diffused through out the host rock. DIP The angle at which rock stratum or structure is inclined from the horizontal. DYKE Tabular igneous intrusive cutting the bedding or planar features in the country rock. BERM A horizontal bench left in the wall of an open pit to provide stability to the wall. EL Exploration Licence. 24 GLOSSARY OF TERMS ELA Exploration Licence application. EM Electromagnetic, a geophysical technique used to detect conductive material in the earth. EOH End of Hole. FAULT A fracture in rocks along which rocks on one side have been moved relative to the rocks on the other. F.C.I. Free carried interest. FELSIC Light coloured rock containing an abundance of any of the following: - feldspars, felspathoids and silica. FERRUGINOUS Containing iron. FLITCH A Mining Term for the different levels in an open pit. GEOCHEMICAL EXPLORATION Used in this report to describe a prospecting technique, which measures the content of certain metals in soils and rocks and defines anomalies for further testing. GEOPHYSICAL EXPLORATION: The exploration of an area in which physical properties (eg. Resistivity, gravity, conductivity and magnetic properties) unique to the rocks in the area quantitatively measured by one or more geophysical methods. g/cc grams per cubic centimetre G.I.C. Gold in circuit g/t grams per tonne GOSSAN The oxidised, near surface part of underlying primary sulphide minerals. GROSS GOLD ROYALTY A royalty payment based on the total amount of product (gold) produced. GRADE g/t – grams per tonne, ppb – part per billion, ppm – parts per million. GRATICULAR BLOCK With respect to Exploration Licences, that area of land contained within one minute of Latitude and one minute of Longitude. GRAVITY CIRCUIT Part of the Gold Treatment Plant where gold particles are accumulated by virtue of their density. GSWA The Geological Survey of Western Australia. ha Hectare JORC The Australasian Code for Reporting of Mineral Resources and Ore Reserves km kilometre KOMATIITE An ultramafic rock with high magnesium content extruded from a volcano. LAG A residual deposit remaining after finer particles have been blown away by wind. LATERITE Highly weathered residual material rich in secondary oxides or iron and/or aluminium. LEACHWELL An analytical method. LODE DEPOSIT A vein or other tabular mineral deposit with distinct boundaries. 25 GLOSSARY OF TERMS MASSIVE Large in mass, having no stratification. Homogeneous structure. OXIDISED Near surface decomposition by exposure to the atmosphere and groundwater, compare to weathering. MINERALISED Rock impregnated with minerals of economic importance. oz Troy ounces = 31.103477 grams M TONNES million tonnes M metre ML Mining Lease. MLA Mining Lease Application. NATIVE TITLE Native Title is the recognition in Australian law of indigenous Australian’s rights and interests in land and waters according to their own traditional laws and customs. In June 1992, the High Court of Australia, in the case of Mabo v Queensland (1992) 175 Commonwealth Law Reports 1, overturned the idea that the Australian continent belonged to no one at the time of European’s arrival. It recognised for the first time that indigenous Australians may continue to hold native title. Indigenous Australians may now make native title claimant applications seeking recognition under Australian law of their native title rights. NATIVE TITLE TRIBUNAL The Native Title Tribunal set up under the Native Title Act 1993. Ni Nickel. OPEN PIT A mine excavation produced by quarrying or other surface earth-moving equipment. ORE GRADE The grade of material that can be (or has been) mined and treated for an economic return. PEDOGENIC The development of soil. PENTLANDITE An important ore of nickel (FeNi)9S8 PETROLOGICAL Pertains to a study of the origin, distribution, structure and history of rocks. PERCUSSION DRILLING Method of drilling where rock is broken by the hammering action of a bit and the cuttings are carried to the surface by pressurised air returning outside the drill pipe. Pd Palladium. PL Prospecting Licence. PLA Prospecting Licence application PORPHYRY A felsic or sub volcanic rock with larger crystals set in a fine groundmass. ppb parts per billion PRIMARY GOLD Gold mineralisation that has not been subject to weathering processes, as opposed to Secondary Gold. PROTEROZOIC The Precambrian era after Archaean. Pt Platinum. OVERCALL Refers to more metal anticipated. (gold) being recovered than PYRITE A common, pale bronze iron sulphide mineral. 26 GLOSSARY OF TERMS PYRRHOTITE An iron sulphide mineral. SILICIFIED Alteration of a rock by introduction of silica. QUARTZ Mineral species composed of crystalline silica. RAB DRILLING Rotary Air Blast Drilling: Method of drilling in which the cuttings from the bit are carried to the surface by pressurised air returning outside the drill pipe. Most “RAB” drills are very mobile and designed for shallow, low-cost drilling of relatively soft rocks. RC DRILLING Reverse Circulation Drilling: A method of drilling whereby rock chips are recovered by air flow returning inside the drill rods rather than outside, thereby providing usually reliable samples. REIDEL FAULT A slip surface that develops during the early stage of shearing. REGOLITH A layer of fragmented and unconsolidated material that overlies or covers basement. STRATIGRAPHY The study of formation, composition and correlation of sedimentary rocks. STRIKE The direction of bearing of a bed or layer of rock in the horizontal plane. SULPHIDES Minerals consisting of a chemical combination of sulphur with a metal. t tonnes TEM Transient Electromagnetic, a geophysical technique used to detect conductive material in the earth. TOLL TREATMENT The treatment of ores where payment is made to the operator of the treatment plant according to the amount of material being treated. RESERVE The mineable part of a resource to which a tonnage and grade has been assigned according to the JORC code. TONNE 32,125 Troy ounces. RESOURCE Mineralisation to which a tonnage and grade has been assigned according to the JORC code. ROCK CHIP SAMPLE A series of rock chips or fragments taken at regular intervals across a rock exposure. SECONDARY GOLD Gold mineralisation that has been subject to and usually enriched by weathering processes. SEDIMENTARY ROCKS Rocks formed by deposition of particles carried by air, water or ice. SHEAR ZONE A generally linear zone of stress along which deformation has occurred by translation of one part of a rock body relative to another part. OZ Troy ounce = 31.103477 grams TREMOLITE A pale coloured amphibole mineral. ULTRAMAFIC An igneous rock comprised chiefly of mafic minerals. UNCUT A term used when referring to average assays where the grade of a particularly high-grade interval is not reduced to a lesser value. VACUUM DRILLING A method of rotary drilling where the drill cuttings are recovered inside the drill rods by a vacuum system. 27 PHOTOGRAPHS & DIAGRAMS Figure 1 Twin Boom Jumbo underground at Wattle Dam Figure 2 Wattle Dam Pit and Underground Mine Portal 29 PHOTOGRAPHS & DIAGRAMS Figure 3 Waste Dump Rehabilitation Figure 4A Preparing to go underground Figure 4 Project Location Plan 30 PHOTOGRAPHS & DIAGRAMS Figure 5 Wattle Dam Diagrammatic Long Section showing selected drill intersections Figure 6 Wattle Dam Mine Portal 31 PHOTOGRAPHS & DIAGRAMS Figure 7 Inspecting progress at Wattle Dam Figure 8 Preparation work for portal development 32 33 DIRECTORS’ REPORT 34 DIRECTORS’ REPORT 35 DIRECTORS’ REPORT 36 DIRECTORS’ REPORT 37 DIRECTORS’ REPORT 38 DIRECTORS’ REPORT 39 DIRECTORS’ REPORT 40 DIRECTORS’ REPORT 41 DIRECTORS’ REPORT 42 DIRECTORS’ REPORT 43 DIRECTORS’ REPORT 44 DIRECTORS’ REPORT 45 AUDITORS’ INDEPENDENCE DECLARATION 46 INCOME STATEMENT 47 BALANCE SHEET 48 STATEMENT OF CHANGES IN EQUITY 49 STATEMENT OF CHANGES IN EQUITY 50 CASH FLOW STATEMENT 51 NOTES TO THE FINANCIAL STATEMENTS 52 NOTES TO THE FINANCIAL STATEMENTS 53 NOTES TO THE FINANCIAL STATEMENTS 54 NOTES TO THE FINANCIAL STATEMENTS 55 NOTES TO THE FINANCIAL STATEMENTS 56 NOTES TO THE FINANCIAL STATEMENTS 57 NOTES TO THE FINANCIAL STATEMENTS 58 NOTES TO THE FINANCIAL STATEMENTS 59 NOTES TO THE FINANCIAL STATEMENTS 60 NOTES TO THE FINANCIAL STATEMENTS 61 NOTES TO THE FINANCIAL STATEMENTS 62 NOTES TO THE FINANCIAL STATEMENTS 63 NOTES TO THE FINANCIAL STATEMENTS 64 NOTES TO THE FINANCIAL STATEMENTS 65 NOTES TO THE FINANCIAL STATEMENTS 66 NOTES TO THE FINANCIAL STATEMENTS 67 NOTES TO THE FINANCIAL STATEMENTS 68 NOTES TO THE FINANCIAL STATEMENTS 69 NOTES TO THE FINANCIAL STATEMENTS 70 NOTES TO THE FINANCIAL STATEMENTS 71 NOTES TO THE FINANCIAL STATEMENTS 72 NOTES TO THE FINANCIAL STATEMENTS 73 NOTES TO THE FINANCIAL STATEMENTS 74 NOTES TO THE FINANCIAL STATEMENTS 75 NOTES TO THE FINANCIAL STATEMENTS 76 NOTES TO THE FINANCIAL STATEMENTS 77 NOTES TO THE FINANCIAL STATEMENTS 78 NOTES TO THE FINANCIAL STATEMENTS 79 NOTES TO THE FINANCIAL STATEMENTS 80 NOTES TO THE FINANCIAL STATEMENTS 81 NOTES TO THE FINANCIAL STATEMENTS 82 NOTES TO THE FINANCIAL STATEMENTS 83 NOTES TO THE FINANCIAL STATEMENTS 84 NOTES TO THE FINANCIAL STATEMENTS 85 DIRECTORS’ DECLARATION 86 INDEPENDENT AUDITOR’S REPORT 87 INDEPENDENT AUDITOR’S REPORT 88 INDEPENDENT AUDITOR’S REPORT 89 SHAREHOLDER INFORMATION 90 SHAREHOLDER INFORMATION 91 SHAREHOLDER INFORMATION 92 CORPORATE DIRECTORY Principal Registered Office Ramelius Resources Limited 140 Greenhill Road UNLEY SA 5061 GPO Box 1373 ADELAIDE SA 5001 Telephone: (08) 8373 6473 / (08) 8373 5588 Facsimile: (08) 83735917 Email: info@rameliusresources.com.au Website: www.rameliusresources.com.au Perth Exploration Office Suite 3, 14 The Avenue MIDLAND WA 6056 P.O. BOX 1527 MIDLAND WA 6936 Telephone: (08) 9250 6644 Facsimile: (08) 9250 6699 Email: rameliuswa@tpg.com.au Australian Securities Exchange Code RMS: Shares RMSOC: Options Listed on Australian Securities Exchange Limited Home Exchange: Adelaide Level 19, 91 King William Street Adelaide SA 5000 Share Registrar Location of Share Register Computershare Investor Services Pty Limited Level 5, 115 Grenfell Street ADELAIDE SA 5000 Telephone: (08) 8236 2300 or 1300 556 161 Facsimile: (08) 8236 2305 Email: info@computershare.com.au Auditors Grant Thornton Chartered Accountants 67 Greenhill Road WAYVILLE SA 5034 Lawyers DMAW Lawyers Level 3, 80 King William Street ADELAIDE SA 5000 Directors and Senior Management ROBERT MICHAEL KENNEDY ASIT, Grad. Dip. (Systems Analysis) FCA, ACIS, FAIM, FAlCD Non-Executive Chairman JOSEPH FRED HOULDSWORTH Non-Executive Director REGINALD GEORGE NELSON BSc (MATHS), FAusIMM, FAICD Non-Executive Director IAN JAMES GORDON BCom, MAICD Executive Director & Chief Executive Officer KEVIN JAMES LINES BSc (Geology), MAusIMM. Non-Executive Director DOMENICO ANTONIO FRANCESE BEc, FCA, FFin, ACIS Company Secretary and Chief Financial Officer DANNY DOHERTY BSc, Applied (Mining Engineering) MAusIMM, Registered Mine Manager, WA Operations Manager ANTONY WEBB BSc. (Metallurgy) Process Manager 

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