Annual Report
2022
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
the mother of nature
Salt is a life-sustaining mineral.
The mother of nature.
Animals roam to find earth rich with salt, consuming
deposits and eating the clay to preserve their existence.
salt animals roam to find earth
rich with salt
For human beings, salt is an endless fountain of
rejuvenation, vital beyond the function of nerves, muscles,
and system regulation. It exists as the oldest and most
ubiquitous source of food seasoning and preservation.
So, while most associate salt with their evening meal,
this mineral made famous by taste is also used in ritual,
purification, and production - a key input to thousands of
industrial and manufacturing processes. Our relationship
with salt can be traced back to ancient texts and abiding art.
thestoryof CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Here in Australia, we say that salt is the great healer;
pain alchemised via sweat, tears, and a swim in the sea.
It’s the hidden lifeblood of entire civilizations,
a mineral that transforms and chemically
combines to produce potash. This potassium
compound, originating from a centuries-old
recipe, quickly became one of humanity’s
most important chemicals.
The essential ingredient in fertiliser, potash
grew hungry crops larger and more drought
resistant. Each harvest showing the spoils
of stronger root systems, amplified water
retention, and remarkable disease resistance.
The agricultural revolution asked for
innovation to sustain the life we now enjoy.
And salt emerged as an unlikely saviour; its
unique properties becoming the sustainable
solution in the production of this essential
global resource.
unique properties
Now, harvested from sea water with the aid of solar energy, potash-infused
fertiliser supports half of the world’s population, as well as the soil from
which all life emerges.
Salt and potash are the sustenance of life and life lived well.
The two resources the world needs for generations to come.
resources the world needs
for generations to come
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
BCI Minerals acknowledges and has a deep respect for the ongoing physical and spiritual
connection Aboriginal people have to the land associated with our projects. BCI acknowledges
the Traditional Custodians of country throughout Australia and pays respect to the Whadjuk
people of the Noongar nation as the Perth Traditional Owners, the Mardie Traditional Owners
the Yaburara and Mardudhunera people and also the Robe River Kuruma people and the
Iron Valley Traditional Owners the Nyiyaparli people and their connections to land, sea and
community. We pay our respects to Elders past, present and emerging and extend that
respect to all Aboriginal and Torres Strait Islander peoples today.
4 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Contents
Who We Are
What the Report Covers
Chair’s Letter
Interim CEO’s Letter
Our Year in Review
Mardie Salt & Potash Project
Iron Valley Mine
Sustainability
Directors’ Report
Remuneration Report
Annual Financial Statement
Independent Auditor’s Report
Auditor’s Independence Declaration
Additional ASX Information
Mineral Resources and Ore Reserves
Corporate Directory
6
7
8
14
18
21
25
26
50
61
74
108
113
114
116
118
BCI MINERALS ANNUAL REPORT 22 / 5
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Who We Are
BCI’s vision is to be a globally significant, sustainable industrial
minerals business, with salt and potash as the initial focus.
Our purpose is to create sustainable value for stakeholders,
by providing resources the world needs for generations to come.
Our Values
People and
Assets
Environment and
Community
Integrity
Performance
Accountability
Teamwork
6 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
What the Report Covers
This annual report is a summary of BCI Minerals Limited’s project and financial results for the financial
year ended 30 June 2022. All references to ‘BCI Minerals’, ‘BCI’, ‘the Company’, ‘we’, ‘us’ and ‘our’ refer
to BCI Minerals Limited (ABN 21 120 646 924). References in this report to a ‘year’ are to the financial
year ended 30 June 2022 unless otherwise stated. All dollar figures are expressed in Australian dollars
(AUD) unless otherwise stated. All references to ‘Indigenous’ people are intended to include Aboriginal
and/or Torres Strait Islander people.
BCI MINERALS ANNUAL REPORT 22 / 7
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
BCI has achieved a series of key
milestones in the development
of our world-scale Mardie Salt &
Potash Project.
8 / BCI MINERALS ANNUAL REPORT 22
8 / BCI MINERALS ANNUAL REPORT 22
01 CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Chair’s Letter
DEAR STAKEHOLDERS,
WELCOME TO BCI’S ANNUAL REPORT FOR THE 2022 FINANCIAL YEAR, A YEAR MARKED BY MAJOR
ACHIEVEMENTS FOR OUR COMPANY, BUT ALSO THE NEED TO NAVIGATE ONGOING CHALLENGES
CONFRONTING THE GLOBAL RESOURCES SECTOR, ESPECIALLY THOSE SECTOR PARTICIPANTS
WHICH, LIKE BCI, ARE ENGAGED IN BUILDING A LARGE GREENFIELD PROJECT.
BCI is not alone in having to adapt to the ongoing
supply chain disruption which began with the COVID-19
pandemic, and the inflationary pressures that have beset
economies across the world.
Despite these challenges, BCI has achieved a series of
key milestones in the development of our world-scale
Mardie Salt & Potash Project. A key pillar of the project is
its sustainability through the use of seawater, solar and
wind to deliver the primary product, combined with our
determination to protect the balance of the surrounding
ecosystems, respect and involve local communities, and
implement work practices to keep our people safe.
This was recognised during the year, with both the
Western Australian and Federal governments providing
regulatory environmental approvals for Mardie.
Combined with sign off on a new port reserve, these
approvals, together with the Board’s Final Investment
Decision and the subsequent equity issue, paved the
way for main construction at Mardie to begin.
This major milestone was celebrated by a ceremony
at the Mardie site attended by the Premier of Western
Australia, Mark McGowan. We are very appreciative of
the support shown to Mardie by our Premier, other State
and Federal Ministers, and their departments. With $384
million of contracts awarded and around $140 million of
construction spend this financial year, the Project is well
under way. Large sections of Mardie’s first two evaporation
ponds have been completed, work on the main seawater
intake station is well advanced, and our 400-room Mardie
accommodation village is also almost complete.
BCI MINERALS ANNUAL REPORT 22 / 9
BCI MINERALS ANNUAL REPORT 22 / 9
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Prudently, in response to the cost pressures and supply
constraints confronting projects like ours, we have
embarked on a comprehensive review of the design,
cost and delivery method for Mardie, including obtaining
further design maturity, progressing approvals required
for completion of the project, and reviewing prices and
quantities of all key inputs.
While these reviews and other work streams are
progressing, we continue to progress construction, with
work ongoing on Ponds 1 to 5, the main seawater intake,
the accommodation village, ancillary works, and front-end
engineering design on several important project elements.
We are proud of the efforts of all of our employees and
contractors on this important work.
We have embarked on a
comprehensive review of
the design, cost and delivery
method for Mardie
As noted above, the 2022 financial year also included
completion of our $260 million share issue, to help fund
Mardie construction. We acknowledge the strong support
of the Australian Capital Equity Group, AustralianSuper,
Ryder and all other participants in this equity raising.
We also obtained $100 million of convertible note
commitments from AustralianSuper, and $740 million
of in principle debt commitments from Northern Australia
Infrastructure Facility (NAIF), Export Finance Australia,
and two lead participants in a proposed commercial
bank syndicate.
We thank our prospective debt partners for their interest
and support, and look forward to closing the debt financing
during the current financial year.
10 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
A key pillar of the project is its sustainability through
the use of seawater, solar and wind to deliver the
primary product, combined with our determination to
protect the balance of the surrounding ecosystems,
respect and involve local communities, and implement
work practices to keep our people safe.
BCI MINERALS ANNUAL REPORT 22 / 11
BCI MINERALS ANNUAL REPORT 22 / 11
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
We have established a strong leadership team, critical in
the current conditions, and its depth has been highlighted
by the appointment of our Chief Financial Officer Kerryl
Bradshaw as interim Chief Executive Officer following the
resignation of Alwyn Vorster.
Kerryl’s appointment reflects her broad and diverse
experience in senior resources sector roles, as well as
her knowledge of BCI developed during Kerryl’s time as
our Chief Financial Officer.
We thank Alwyn for his vision, commitment and
contribution to BCI.
Finally, I would also like to thank my fellow Board members
for their support and diligent application to the task of
continuing to unlock the clear and demonstrated potential
of our Company and the Mardie project.
BRIAN O’DONNELL
CHAIR
Our priority in the next six months is to complete the
current review and approvals work, and then progress
discussions with our equity and debt partners in relation
to the additional funding we expect to be required to
complete the project. We will provide further advice on
this work when it is sufficiently advanced.
We are encouraged that market prices for salt and sulphate
of potash are much higher than they were at the time of
our Final Investment Decision, potentially supporting a
total project cost higher than previously estimated.
While our core focus is completion of the Mardie Project,
we also acknowledge the ongoing contribution from the
Iron Valley mine. Our arrangement with Mineral Resources
Limited (ASX: MIN) generated revenue of $65.2 million in
FY22, and EBITDA of $27.8 million. We thank MIN for its
ongoing contribution to our group.
The underlying asset strength of our business is matched
by the strength and diversity of our people. Resilience
and adaptability are key traits required in the resources
sector and the BCI team continue to demonstrate these
every day.
The underlying asset
strength of our business is
matched by the strength
and diversity of our people.
12 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Our priority in the next
six months is to complete
the current review and
approvals work.
BCI MINERALS ANNUAL REPORT 22 / 13
BCI MINERALS ANNUAL REPORT 22 / 13
CONTENTS
CHAIR’S LETTER
INTERIM
CEO’S LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO’S LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Interim CEO’s Letter
DEAR BCI STAKEHOLDERS,
IT IS A PRIVILEGE TO BE PROVIDING THIS UPDATE TO YOU AS THE INTERIM CHIEF EXECUTIVE
OFFICER OF BCI MINERALS. I AM PROUD TO BE LEADING A TEAM WITH SUCH A HIGH LEVEL OF
CAPABILITY, WHO ARE DEDICATED TO OUR VALUES, AND HAVE A STRONG COMMITMENT TO
AND BELIEF IN OUR COMPANY.
Rightly, the Mardie Project is dominating our thinking given
its scale and where we sit on the project timeline, but it
is literally being built on a diverse and strong company
foundation. Before I dig deeper into Mardie, I want to share
with you some insights that I believe demonstrate the
undeniable long-term strength of BCI.
People and Safety
BCI is committed to retaining and attracting a diverse
workforce and has made significant progress on its
diversity achievements during the year. We have a female
participation rate of 42%, with females representing
39% of those in leadership roles and have increased our
Indigenous participation at Mardie.
The wellbeing of our workforce is a continued focus for our
business, and we strive for improved safety outcomes for
all stakeholders.
BCI’s Total Recordable Injury Frequency Rate (TRIFR) at
June 2022 was 4.1 compared to 7.3 at June 2021. The
40% improvement in the TRIFR is particularly pleasing
given the 260% increase of hours worked since
commencement of construction.
I strongly believe the improvement in safety outcomes
reflect the underlying culture within BCI, which is centred
on teamwork and accountability. Our culture has at its core
the care, commitment and respect in everything that we
do – whether it be for the environment, each other, our
investors and valued stakeholders including the traditional
owners of the land upon which we are building Mardie.
14 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO’S LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO’S LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
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The wellbeing of our
workforce is a continued
focus for our business, and
we strive for improved safety
outcomes for all stakeholders.
BCI MINERALS ANNUAL REPORT 22 / 15
BCI MINERALS ANNUAL REPORT 22 / 15
02 CONTENTS
CHAIR’S LETTER
INTERIM
CEO’S LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO’S LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Mardie Salt & Potash Project
Mardie is a future Tier One project, which will produce over
5 million tonnes per annum of salt and will be the first
salt operation in Australia to produce high value sulphate
of potash fertiliser as a by-product. The feedstock is
inexhaustible seawater, from the Indian Ocean and 99%
of the required project energy comes from natural sun and
wind for evaporation, making Mardie a multi-generational
sustainable opportunity.
Main construction commenced in February 2022 after the
overarching environmental approvals were granted. We all
know that project development is not easy in the current
climate and at BCI we are adapting to address that.
Whilst we have recognised both some design changes
due to imposed conditions and design development,
and higher costs on our project, we are currently
seeking to mitigate those through our value engineering
program. This is resulting in some wins and alternate
development pathways.
Despite these challenges, on-site activity has advanced
well, and key contracts have been awarded. Pond 0, the
settling pond, has been completed by SRG Global, who are
now in the latter construction stages of the Ponds 1 and
2 wall and levee system. Further north on the Project, the
earthworks contract for Ponds 3, 4 and 5 has been awarded
to Australian construction company, QH&M Birt, who have
commenced work on Pond 3 and made solid progress.
The seawater intake station is also well advanced, with
commissioning anticipated this calendar year. The largest
direct capital works contract for Mardie was awarded during
the year to McConnell Dowell Constructors (Australia)
Pty Ltd for the marine structures package – a fixed price
contract which includes the jetty structure, transhipper
mooring equipment, material handling system and
navigation aids.
16 / BCI MINERALS ANNUAL REPORT 22
16 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO’S LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO’S LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
The award and delivery of these contracts is a significant
undertaking, both in terms of work on the ground and the
financial commitment. With $360 million of capital raised
in December 2021, and continued revenue contribution
from the Iron Valley mine, BCI’s cash position remains
strong and our construction program is well-funded for
the 2023 financial year.
Outlook
BCI has a solid base with strong support. We are developing
a Project of which the potential continues to be recognised
even in today’s economic turbulence. Demand for the
commodities that we will ship from Mardie to Asian
markets continues to be strong with salt prices up by at
least 25% in the last 12 months and sulphate of potash
increasing by approximately 85%.
In closing, I would like to thank all our valued employees
and contracting partners for their contributions this year.
I would also like to acknowledge the Board of Directors and
my fellow Executive Leadership Team for their commitment
and support.
It is an exciting time and we remain focused on delivering
positive outcomes and a great project.
KERRYL BRADSHAW
INTERIM CHIEF EXECUTIVE OFFICER
BCI MINERALS ANNUAL REPORT 22 / 17
BCI MINERALS ANNUAL REPORT 22 / 17
CONTENTS
CHAIR’S LETTER
INTERIM
CEO’S LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO’S LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
44%
improvement in
safety performance
TRIFR1 v Hours Worked
d
e
k
r
o
w
s
r
u
o
H
600,000
500,000
400,000
500,000
200,000
100,000
0
Hours worked
TRIFR
FY19
25,694
77.8
FY20
44,642
22.4
FY21
136,334
7.3
FY22
490,478
4.1
1 TRIFR – Total Recordable Injury Frequency Rate: total number of injuries including medical treatment injuries (MTI), restricted work
injuries (RWI) and lost time injuries (LTI) per million hours worked (includes BCI employees and contractors).
260%
increase in
hours worked
100
80
60
40
20
0
R
F
I
R
T
Our Year in Review
Secured Mardie approvals and tenure
Main construction milestone achieved,
and advanced progress made at site
$65.2M
$27.8M
revenue from Iron Valley
Iron Valley EBITDA
Cultural transformation program to
attract and retain skilled workforce
$360M
capital raise following
Final Investment Decision
$384M
of contracts awarded
$142M
construction spend
18 / BCI MINERALS ANNUAL REPORT 22
18 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO’S LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO’S LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Secured Mardie approvals and tenure
Main construction milestone achieved,
and advanced progress made at site
$65.2M
$27.8M
revenue from Iron Valley
Iron Valley EBITDA
Cultural transformation program to
attract and retain skilled workforce
$360M
capital raise following
Final Investment Decision
$384M
of contracts awarded
$142M
construction spend
44%
improvement in
safety performance
TRIFR1 v Hours Worked
260%
increase in
hours worked
100
80
60
40
20
0
R
F
I
R
T
d
e
k
r
o
w
s
r
u
o
H
600,000
500,000
400,000
500,000
200,000
100,000
0
Hours worked
TRIFR
FY19
25,694
77.8
FY20
44,642
22.4
FY21
136,334
7.3
FY22
490,478
4.1
1 TRIFR – Total Recordable Injury Frequency Rate: total number of injuries including medical treatment injuries (MTI), restricted work
injuries (RWI) and lost time injuries (LTI) per million hours worked (includes BCI employees and contractors).
BCI MINERALS ANNUAL REPORT 22 / 19
BCI MINERALS ANNUAL REPORT 22 / 19
CONTENTS
CHAIR’S LETTER
INTERIM
CEO’S LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO’S LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
BCI Minerals is a Western Australian
company that is developing an
industrial minerals business,
with the Mardie Salt & Potash
Project as the initial focus.
BROOME
PORT HEDLAND
KARRATHA
MARDIE SALT &
POTASH PROJECT
ONSLOW
PANNAWONICA
MARBLE BAR
EXMOUTH
TOM PRICE
IRON VALLEY
MINE
PARABURDOO
NEWMAN
CARNEGIE POTASH
JOINT VENTURE
WILUNA
PERTH
20 / BCI MINERALS ANNUAL REPORT 22
20 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO’S LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO’S LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Mardie Salt & Potash Project
THE MARDIE SALT & POTASH PROJECT IS LOCATED APPROXIMATELY 80KM FROM KARRATHA,
ON THE PILBARA COAST OF WESTERN AUSTRALIA (WA).
The Mardie Salt & Potash Project is on track to become
the first new solar salt operation in Western Australia in
over 25 years, and the first to produce salt and sulphate
of potash (SOP) from seawater. The Project has strong
green credentials with the Indian Ocean providing an
inexhaustible feedstock, and natural solar and wind
energy providing 99% of the energy required to produce
salt and SOP.
The Pilbara coast is one of the world’s premier regions for
solar salt production. Five existing solar evaporation salt
projects have been operating successfully in this region for
up to fifty years, producing a quality, reliable salt product
which is consistently in high demand in the chemical and
other industries.
Mardie’s site has all the critical characteristics for
establishing a large-scale solar evaporation operation,
including: optimum climate conditions (high temperatures,
low rainfall, low humidity, and high windspeeds); a large
area (~100km2) of impermeable mudflats as an ideal
floor for evaporation ponds; minimal environmental and
heritage sensitivities; and a coastal location for low cost
shipping to Asian markets.
At Mardie, an inexhaustible seawater resource will be
concentrated through solar and wind evaporation to
sustainably produce 5.35 million tonnes per annum (Mtpa)
of high purity sodium chloride (NaCl) salt and 140 thousand
tonnes per annum (ktpa) of sulphate of potash (SOP or
K2SO4) fertiliser and supply the growing chemical and
agricultural industries over an operating life of at least
60 years.
The 2022 financial year was marked by the clear transition
from the feasibility stage to the construction phase of the
Mardie Salt & Potash Project.
BCI MINERALS ANNUAL REPORT 22 / 21
BCI MINERALS ANNUAL REPORT 22 / 21
CONTENTS
CHAIR’S LETTER
INTERIM
CEO’S LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO’S LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Progress Update
Rapid progress was made on site following milestone
events in the first half of the financial year. The BCI Board
reached a Final Investment Decision for the Mardie Project
in October 2021 and a month later, the Western Australian
Minister for Environment approved the proposed
development of Mardie’s Definitive Feasibility Study (DFS)
footprint with conditions.
Early in the new year, the required Commonwealth
environmental approval was obtained from the
Department of Water, Agriculture and Environment, now
known as the Department for Climate Change, Energy, the
Environment and Water, and Project mining leases were
granted by the Department of Mines, Industry, Regulation
and Safety shortly thereafter.
Another important achievement included recognition of
Mardie as a future export hub with an Indigenous Land
Use Agreement (ILUA) executed between the Wirrawandi
Aboriginal Corporation (WAC) representing the Mardie
Traditional Owners, the Western Australian Government
and BCI to allow the creation of a port reserve at Cape
Preston West. The ILUA is a critical step in developing the
infrastructure needed to directly deliver salt and sulphate
of potash into Asian markets.
The culmination of these approvals and agreements was
an on-site construction ceremony on 25 March 2022
where Western Australian Premier Mark McGowan joined
BCI Minerals’ Board, leadership team, Mardie Traditional
Owner representatives and community stakeholders
to officially launch the Mardie Project. Since that time
considerable progress has been made on core Project
components and supporting infrastructure.
MARDIE ACCOMMODATION VILLAGE
With construction ramping up, a key focus at Mardie
during the year was the expansion of the accommodation
village, with works undertaken by contracting partner
McNally Group. The village has expanded from 80 to
400 rooms, with central facility buildings fitted out and
landscaping works progressed. In conjunction with WAC,
the combination mess facility has been named “Yawan”
(hot cooking stones). The village is expected to be fully
operational by the end of calendar year 2022.
22 / BCI MINERALS ANNUAL REPORT 22
22 / BCI MINERALS ANNUAL REPORT 22
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POND CONSTRUCTION
SEAWATER INTAKE
Integral to the eventual move from development into
production at Mardie are the ponds which will produce
5.35Mtpa of high-purity salt. During the year, the northern
embankment trial and Pond 0 were completed, with
contractor SRG Global progressing large sections of the
Ponds 1 and 2 wall and levee system.
The earthworks contract for Ponds 3, 4 and 5 was awarded
to Australian construction company, QH&M Birt (Q-Birt)
in the latter half of the year, with the contractor mobilised
to site and Pond 3 construction works underway. The
contract also includes the earthworks required for transfer
pump stations 3 to 4 and 5 to 6 and the installation and
commissioning of groundwater monitoring wells parallel to
the gas pipeline corridor.
The seawater intake pump structure will maintain
the inflow of seawater to the pond system. The main
pump structure includes six 3,000 -litres-per-second
pumps, which will pump 160 gigalitres of water into
the evaporation ponds each year – equivalent to
approximately 70,000 Olympic swimming pools.
The pumps have been procured by BCI, and the design,
procurement, construction, and commissioning of
the primary seawater intake structure was awarded to
engineering group Ertech Geomarine in the first half
of the financial year.
All piling has now been installed, with concrete and
steel structural elements underway. Subsequent to
the period, installation of the pumps has begun, and
commissioning activities are anticipated to commence
before the end of the calendar year.
BCI MINERALS ANNUAL REPORT 22 / 23
BCI MINERALS ANNUAL REPORT 22 / 23
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MARINE STRUCTURES PACKAGE
DESIGN OPTIMISATION
The largest direct capital works contract for the Project
was awarded during the period to McConnell Dowell
Constructors (Aust) Pty Ltd for the ~$190 million marine
structures package.
The design and construct package includes the jetty
structure, transhipper mooring equipment, material
handling system and navigation aids.
The marine structures package is on track, with 100%
of jetty design received and 60% of mechanical designs
completed. Onsite construction for the marine structures
is expected to commence following the completion of the
jetty causeway.
While solid progress has been made on site, the current
inflationary economic climate has necessitated a design
optimisation and cost review. Cost increases across Mardie
construction packages became evident in the second half
of the year with market inflation across labour, materials,
equipment, and consumables impacting prices.
Combined with design changes, which were necessary to
comply with third party approvals, and development of
designs across the Project, BCI is undertaking a detailed
cost and design review, with the objective of strengthening
design maturity and price confidence. BCI will provide
a further update following the conclusion of these
assessments.
24 / BCI MINERALS ANNUAL REPORT 22
24 / BCI MINERALS ANNUAL REPORT 22
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Iron Valley Mine
IRON VALLEY IS A MINE LOCATED IN THE CENTRAL PILBARA, WHICH IS BEING OPERATED BY
MINERAL RESOURCES LIMITED (ASX:MIN) UNDER A ROYALTY-TYPE AGREEMENT.
As at 30 June 2022, Iron Valley’s Mineral Resource was
167.2Mt at 58% Fe and its Ore Reserve was 54.5Mt at
58.2% Fe.
Iron Valley commenced exports in October 2014 and is
generating royalty-type earnings for BCI. It is a relatively
simple Direct Shipping Ore (DSO) operation that produces
both lump and fines, which are hauled to Port Hedland
utilising road trains and exported via Utah Point. It has
a potential mine life of around 10 years based on
current ore reserves and the current production rate
of approximately 6Mtpa.
MIN operates the mine entirely at its cost and purchases
Iron Valley product from BCI at a price linked to MIN’s
realised sale price. BCI retains ownership of the tenements
and certain statutory obligations, including payment of
royalties. BCI’s EBITDA from Iron Valley was A$27.8M in
FY22.
BCI MINERALS ANNUAL REPORT 22 / 25
BCI MINERALS ANNUAL REPORT 22 / 25
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S u s t a inability Pillars
U I T Y
Q
L E
C I A
S O
Provide a Safe
Environment
Promote
Community Prosperity
Sustainability
Principles
Harness
Renewable Resources
E
N
V
I
R
O
N
M
E
N
T
A
L
P
R
O
T
E
C
TIO
Maximise Value,
Minimise Waste
Mitigate
Climate Change
N
E
C
O
N
O
MIC VIABILITY
FIGURE 1: BCI’S SUSTAINABILITY PRINCIPLES AND PILLARS
26 / BCI MINERALS ANNUAL REPORT 22
26 / BCI MINERALS ANNUAL REPORT 22
03
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Sustainability
BCI’S PRIMARY FOCUS IS TO BUILD A COMMERCIALLY SUSTAINABLE BUSINESS BY DEVELOPING
THE MARDIE SALT & POTASH PROJECT, AND THE PRIMARY PURPOSE OF THE PROJECT IS TO
HARNESS RENEWABLE NATURAL RESOURCES TO PRODUCE QUALITY PRODUCTS TO SUSTAIN
AND IMPROVE LIFE ON EARTH.
Salt and sulphate of potash (SOP) will be the principal
products harvested at Mardie. Salt is an essential chemical
input for more than 10,000 products including glass (a key
input for solar panels), PVC, soaps and pharmaceuticals and
is also used for water treatment, de-icing and in the food
industry. SOP is a high value fertiliser that improves crop
quality and yield.
Sustainability is central to Mardie’s production process with
seawater the inexhaustible feedstock for salt and SOP
production and 99% of the energy required to drive the
evaporation process coming from clean, natural solar and
wind sources.
In its 2021 Annual Report, BCI outlined its priorities to
develop a robust emissions reduction strategy, to ensure
environmental commitments are met or exceeded during
construction of the Mardie Project and to ensure BCI
continues to build respectful relationships with Indigenous
and other community stakeholders. Since then, a
Sustainability Strategy has been developed which brings
together the sustainable practices and activities undertaken
across the organisation, providing structure and clarity as
to how initiatives relate to objectives, related targets and
governance. With the benefit of this strategy, targets have
been set and outputs are being monitored and measured in
anticipation of reporting.
As part of this strategy, sustainability pillars were
established that align with the priorities identified by
the BCI Sustainability Committee and Board in the 2021
Annual Report and provide structure for BCI’s Sustainability
Principles. This framework is depicted in Figure 1.
During the year a Sustainability Steering Group was
established with the purpose of developing and
implementing BCI’s strategy by defining what sustainability
means for BCI, setting sustainability objectives and targets
for the business and developing initiatives and action plans
for short, medium and long-term outputs.
BCI further developed its Project Environmental and
Social Management System (ESMS) which identifies
the environmental and social management framework
of the Mardie Project. It is an overarching roadmap
accompanied by a document register which seeks to ensure
environmental and social compliance with identified
obligations and legislation. The ESMS lists all applicable
legislation and identifies the required approvals and
management plans relevant to the Mardie Project,
including the full suite of project standards.
This section of BCI’s Annual Report details the sustainable
activities and practices undertaken across the business over
the year and follows the Global Reporting Initiative (GRI)
framework regarding the selection process for material
topics, paving the way to produce a Sustainability Report
with reference to the GRI standards in 2023.
BCI MINERALS ANNUAL REPORT 22 / 27
BCI MINERALS ANNUAL REPORT 22 / 27
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Stakeholder Engagement
BCI engages with key stakeholders in a regular, structured
and culturally sensitive manner including affected
communities, employees and other stakeholders. This
includes engagement as part of the Mardie Project impact
assessment and approvals processes. The Project has
developed a Stakeholder Engagement Management Plan
(SEMP), an Annual Stakeholder Engagement Procedure
(Procedure), and an Indigenous Engagement Strategy (IES).
The SEMP describes how stakeholder communication
will be managed by the Mardie Project and the general
approach to engagement and grievance management.
The Procedure operationalises the SEMP, identifying and
characterising key stakeholders and outlining the tools and
tactics for communication with different groups.
The SEMP identifies the following groups as key
stakeholders for the Mardie Project:
•
Landholders and Native Title parties
• Community groups
•
Industry and local businesses
• Government agencies/regulators
• Conservation groups
• Development agencies/groups
FIGURE 2: MATERIALITY MATRIX
And as an ASX-listed company developing a salt and
potash operation, BCI has additional key stakeholders:
• Shareholders
• Employees/Board/Contractors/Unions
• Customers/Offtake partners
•
Lenders
• Media
BCI applied a materiality process to inform the scope
and level of disclosures identified in the report. Material
topics were selected by considering feedback from
stakeholders, BCI’s leadership team, subject matter experts
and an examination of industry benchmarks. Topics
were evaluated and prioritised to ensure the Company’s
purpose and strategic focus areas were considered and are
presented in Figure 2.
Activities undertaken by BCI during the year and covered
by the topics highlighted in the Materiality Matrix are
outlined in the following section of this report with
reference to the BCI Sustainability Pillars, Principles,
objectives, targets and the related United Nations
Sustainable Development Goals (SDG).
Health, Safety
& Wellbeing
Economic
Performance
Indigenous Peoples
& Cultural Heritage
Ground
Disturbance
Management
MATERIAL TOPIC INDEX
1. Health, Safety & Wellbeing
2. Diversity, Inclusion & Equal Opportunity
3. Economic Performance
4. Emissions & Climate
5. Biodiversity
6. Effluents, Waste & Water
7. Ground Disturbance Management
8. Local Communities
9.
Indigenous Peoples & Cultural Heritage
10. Procurement Practices & Employment
Emissions &
Climate
Biodiversity
Local Communities
Procurement
Practices &
Employment
Effluents, Waste
& Water
Diversity, Inclusion
& Equal Opportunity
i
h
g
H
y
r
e
V
f
o
s
l
e
v
e
L
n
r
e
c
n
o
C
r
e
d
o
h
e
k
a
t
S
l
w
o
L
Low
Impact on BCI Minerals
Very High
28 / BCI MINERALS ANNUAL REPORT 22
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BCI MINERALS ANNUAL REPORT 22 / 29
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1. Health, Safety & Wellbeing
PILLAR: SOCIAL EQUITY
PRINCIPLE:
OBJECTIVE:
Ensure BCI employees, contractors and visitors come home safely
Provide a
Safe Environment
TARGETS:
• Zero fatalities;
• TRIFR<15
BCI has a proud safety record of seven years without a lost time injury (LTI). The Total Recordable Injury Frequency Rate
(TRIFR1) improved by 44% over the year to 4.1, a pleasing result given the 260% increase in hours worked as construction
activities ramped up over the period.
TRIFR1 v Hours Worked
d
e
k
r
o
w
s
r
u
o
H
600,000
500,000
400,000
500,000
200,000
100,000
0
100
80
60
40
20
0
R
F
I
R
T
Hours worked
TRIFR
FY19
25,694
77.8
FY20
44,642
22.4
FY21
136,334
7.3
FY22
490,478
4.1
To ensure safety performance continues to improve, all BCI
employees have safety as a KPI, and seven staff members,
or 8% of the workforce, have safety as the primary purpose
of their role.
BCI has a documented Health and Safety Policy which
commits to the provision of a safe, productive and healthy
work environment for all workers, contractors and visitors.
This is supported by BCI’s Health and Safety Management
System which documents the minimum expectations for
work which is to be performed on the Project.
The general induction pack provided to all employees and
contractors who work on site includes health and safety
content and important information on BCI’s Licence to
Operate including work undertaken near the gas pipeline
easements and requirements for access through the
pastoral lease. BCI uses an Authority to Work permit for
all non-routine or high-risk tasks, including access within
the gas pipeline easement. It is required to be used by all
employees and contractors prior to the commencement
of the task.
BCI implements a Job Hazard Analysis (JHA) for all tasks
on site at Mardie. The JHA form includes consideration of
environmental hazards where applicable and the risks and
controls associated with the task. Contractors also employ
their own JHA process through completion of safety
processes such as Safe Work Method Statements,
pre-start meetings and Take 5 assessments.
1 TRIFR – Total Recordable Injury Frequency Rate: total number of injuries including medical treatment injuries (MTI), restricted work injuries (RWI)
and lost time injuries (LTI) per million hours worked (includes BCI employees and contractors).
30 / BCI MINERALS ANNUAL REPORT 22
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The health, safety and wellbeing of BCI’s workforce was
the focus of training provided over the course of 2022,
including Unconscious Bias Training, Cultural Awareness
Training, Leadership Training on Changes to Work, Health
& Safety laws in WA, 4-Wheel Drive and All-Terrain Vehicle
training for site-based employees, and the implementation
of BCI Online Learning to build soft skills.
BCI has reviewed its internal and external grievance
mechanisms to ensure that they are visible, accessible
and embedded within Company processes, allowing all
stakeholders to engage and communicate with BCI.
The health, safety and wellbeing
of BCI’s workforce was the focus
of training provided over the
course of 2022.
The incidence of sexual harassment in the Australian
resources sector, particularly within site accommodation
villages, remains a disturbing issue. BCI acknowledges
and supports all the recommendations arising from the
National Parliamentary Inquiry into sexual harassment
against women in the FIFO mining industry.
BCI has zero tolerance for sexual harassment and has
undertaken a review of its Code of Conduct, People
Policy, and Diversity, Equity and Inclusion Policy, and
implemented associated strategies, and action plans to
ensure that this position is captured and conveyed.
With regard to the Mardie Village accommodation design,
a BCI female committee was involved which considered
physical and social safety measures. Consultation with
the Chamber of Minerals and Energy WA (CMEWA)
Safe and Respectful Working Group Committee and
recommendations from the National Parliamentary Inquiry
into sexual harassment against women in the FIFO mining
industry were also key inputs to the village design.
BCI’s pandemic protocols continued to be tested
throughout the year. The flexibility to respond to the WA
Government health advice for BCI’s head office and Mardie
site were key to ensuring the health and safety of BCI’s
workforce. BCI’s COVID Management Plan was continually
reviewed and updated, and key controls included reviewing
essential workers for site-based travel and conducting pre-
entry COVID declarations and temperature testing. During
outbreak periods, additional risk mitigations controls were
implemented such as BCI participating in the FIFO DETECT
program prior to site entry. Working from home was a key
requirement during lockdown periods whilst still keeping
teams socially connected to one another.
BCI MINERALS ANNUAL REPORT 22 / 31
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2. Diversity, Inclusion & Equal Opportunity
PILLAR: SOCIAL EQUITY
PRINCIPLE:
OBJECTIVE:
Foster and promote a culture of diversity and inclusion across
the organisation
Provide a
Safe Environment
TARGETS:
• 5% Indigenous Australian employment;
• 20% female directors;
• 40% females in management positions;
• 43% female employment;
• 30% females on site in FY23;
BCI has proactively addressed issues of gender and
workplace discrimination and harassment in mining
environments, which has been a key issue in the Australian
mining industry, and a key component of labour and human
rights considerations. BCI ensured that senior leaders in the
business attended an externally facilitated day-long training
course on bullying and harassment and that a leaders’ guide
to delivering diversity moments and creating psychological
safety was developed. In addition, all employees attended
a purpose-built unconscious bias training program and had
access to rapid-learning sessions to foster a more inclusive
work environment. BCI also continues to regularly survey the
workforce regarding BCI practices and to assess culture.
BCI is committed to establishing a safe, respectful and
inclusive culture where diverse experiences, perspectives,
backgrounds and ideas are valued and utilised at every level
of its corporate and site workplaces. BCI believes this will lead
to alternative ways to approach challenges, solve problems,
and identify growth opportunities, which will result in a work
environment where better decisions are made.
To demonstrate this commitment, during the reporting
period BCI prepared and implemented a Diversity, Equity
and Inclusion (DEI) Strategy and Plan together with its
first Diversity, Equity and Inclusion Policy, which further
articulates BCI’s commitment towards fostering, promoting
and establishing a culture of diversity and inclusion at every
level of its corporate and site culture, including its relationship
with stakeholders.
The BCI Board believes that the setting of DEI measurable
objectives and reporting performance against these
objectives is an enabler of corporate strategy. To support the
achievement of the proposed measurable objectives, BCI’s
strategy includes the following three areas for action:
1. Raise awareness through training, education and
communications highlighting BCI expectations and
increasing two-way feedback, enhancing BCI’s inclusive
culture both internally and externally, with a focus on
encouraging psychological safety and alignment with
BCI values and obligations.
2. Equal opportunities for females to access training,
and to support female representation on the Board,
a commitment to continue to increase female
director representation.
3.
Indigenous engagement through collaboration with
suppliers to increase indigenous employment and
partnering with the local community to support key
activities including BCI’s Reconciliation Action Plan, cross-
cultural training and recruitment to provide entry-level
programs and pathways to long-term employment.
Gender diversity is already a key feature of BCI’s workforce
with female employment of 42% across the organisation
and female representation of 29% at Mardie site, 39% in
management positions and 14% holding directorships at the
end of the 2022 financial year.
BCI is committed to ensuring that employees with similar
skills, knowledge, qualifications, experience and performance
are paid equally for the same or comparable work. BCI
will remain focussed on pay equity and improving female
representation at all levels.
BCI’s workforce is predominantly located in Perth, however
now that construction has commenced, recruitment will
focus on Pilbara local and Indigenous communities to
support the operation, with two key appointments made
at Mardie site in 2022.
32 / BCI MINERALS ANNUAL REPORT 22
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3. Economic Performance
PILLAR: ECONOMIC VIABILITY + SOCIAL EQUITY
PRINCIPLE:
OBJECTIVE:
Build beneficial and respectful relationships with the community and
all other stakeholders
TARGET:
Steady state annual production of 5.35Mtpa of salt and 140ktpa of SOP
to deliver annuity style returns to BCI shareholders, Traditional Owners,
State and Federal Governments
Promote
Community Prosperity
Maximise Value,
Minimise Waste
At Mardie, an inexhaustible seawater resource will be
concentrated through solar and wind evaporation to
sustainably produce 5.35 million tonnes per annum (Mtpa)
of high purity sodium chloride salt and 140 thousand
tonnes per annum (ktpa) of sulphate of potash (SOP)
fertiliser to supply the growing chemical and agricultural
industries in Asia over an operating life of at least 60 years.
BCI commenced the four-year construction phase of the
Mardie Project in February 2022. Once completed and
fully operational, and in addition to annuity-style returns
to BCI’s shareholders, the Project is expected to generate
approximately $8 billion in corporate taxes, $800 million
in state government royalties and more than $200 million
in native title payments over its 60+ year life.
Mardie will use an
inexhaustible seawater
resource, concentrated
through solar and wind
evaporation, to sustainably
produce salt.
In the meantime, the direct economic value generated and
distributed by BCI in the financial year to 30 June 2022
involved:
•
•
•
•
•
$65.2 million in revenue from Iron Valley mine with
$27.8 million EBITDA from its operation. The royalty-
style earnings from Iron Valley support BCI’s operating
costs while the Mardie Project is built
$37.4 million in royalties distributed to third parties
from Iron Valley
$162.7 million of expenditure to construct Mardie
Village and substantial components of the seawater
intake station, Ponds 0, 1 and 2 and supporting
infrastructure for the Mardie Project
$12.1 million paid to employees
$10 million spent with approximately 40 local
Pilbara suppliers
The financial implications and other risks and opportunities
due to climate change are covered in the Emissions and
Climate topic where the outcomes of the Mardie Project’s
Climate Change Risk Assessment are outlined. Potential
Project design changes are being considered to improve
the long-term resilience of the Project to extreme
weather events.
BCI MINERALS ANNUAL REPORT 22 / 33
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4. Emissions & Climate
PILLAR: ENVIRONMENTAL PROTECTION + ECONOMIC VIABILITY
PRINCIPLE:
OBJECTIVE:
Harness
Renewable Resources
Mitigate
Climate Change
Reduce carbon emissions
TARGETS:
• 99% of energy to be derived from solar and wind
• Production of salt via energy efficient solar evaporation of seawater
rather than more emissions intensive rock salt and solution mining
techniques used elsewhere
• Production of SOP via more energy efficient flotation/schoenite
process than the Mannheim process used by global peers
• Develop emission reduction strategy
In addition, BCI aims to contribute to climate change
mitigation by producing salt and SOP via lower energy
and emissions intensive processes than used in industrial
production elsewhere. More than 50% of global salt is
produced by energy and emissions intensive rock salt
mining (21% of global capacity) and solution mining (32%
of global capacity). Mardie aims to contribute to global salt
supply with salt produced by solar evaporation of seawater,
a process that emits 95% less CO2 than solution mining/
processing and 70% less CO2 than rock salt mining.
Similarly, approximately 50% of the global SOP market
is supplied by producers using the energy intensive
Mannheim process. Mardie will be an energy efficient
SOP fertiliser producer using a flotation/schoenite process
which produces approximately 50% less emissions
than the Mannheim process. Mardie’s port location has
the additional environmental benefit of reduced freight
haulage-related emissions compared with landlocked
domestic and international peers that require trucking
of SOP to markets.
Climate change is a key consideration for the Mardie
Project and during the year an independent expert was
engaged to conduct a Climate Change Risk Assessment
(CCRA). This involved a high-level evaluation of natural
hazards which are likely to affect the Project under baseline
and climate change scenario timeframes of 2030 and
2050 and used projections from the Intergovernmental
Panel on Climate Change (IPCC).
BCI developed a standalone Environment Policy during
the year which outlines the Company’s goal to minimise
impacts to the environment from its activities and
highlights its commitment to the sustainable management
and efficient use of natural resources. Key features of the
policy include the development and implementation of
strategies to reduce carbon emissions from BCI’s activities
as well as a commitment to the sustainable reduction of
waste through elimination, reduction, recycling and re-use.
Mardie will be an energy
efficient SOP fertiliser
producer using a flotation/
schoenite process which
produces 50% less emissions.
When the current construction phase concludes and
production commences at Mardie, the energy required
to process 5.35Mtpa of salt and 140ktpa of SOP is
approximately 1,075 gigawatt hours per annum (GWhpa).
More than 99% of this energy requirement relates to
the evaporation process which is driven by natural sun
and wind energy. The remaining expected 1% of energy
demand represents 76.6kt CO2 equivalent and is largely
associated with the SOP and salt processing plants,
desalination plant, jetty, brine distribution and to a
lesser extent with harvesting, haulage, and transhipping
equipment. BCI is developing a strategy to reduce
emissions by using renewables, diesel substitution and
self-generated offsets.
34 / BCI MINERALS ANNUAL REPORT 22
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Several physical risks were noted as increasing under
various climate change scenarios with the highest risk rated
hazards being water stress, wildfire and floods. Some of
the key actions recommended by the assessment and
being addressed by BCI relate to:
•
Infrastructure designs being cognisant of the potential
impacts from increasing cyclone intensity
• Project design already considers flooding and
maintenance of water flows, however BCI is
investigating further options to mitigate the potential
for flood impacts
• Bushfire risk assessment to determine vulnerabilities
and appropriate bushfire risk management strategies
• Water availability is addressed through the construction
of a desalination plant
The design basis for the jetty is to withstand a 1 in
500-year event and considers increased cyclonic activity.
An additional Project impact was considered whereby
winds create wave sets within the ponds. To accommodate
this, pond walls are designed with a margin protecting
against internal storm surges with levees spaced far enough
apart to reduce wave fetch and size within the ponds.
The risk of flood is already high under baseline scenarios,
and the Project design accommodates extreme weather
events. Extreme precipitation events are not projected to
increase significantly in terms of volume of water under
the climate change scenarios. Baseline one-day maximum
rainfall is currently 364mm, with projected increase up to a
maximum of 384mm under the 2050 worst case scenario.
Accordingly, BCI has already undertaken numerous
hydrology studies including hinterland surface water flow
modelling, which have informed the design. The greatest
hazard from flood risk is the risk of floodwater entering the
ponds or crystallisers. Project location has been selected
to minimise surface water flows from land to sea and the
design includes an elevated access road which acts as
a diversion bund to direct water flow through drainage
channels to push the water away from ponds and roads.
Other existing freshwater flood mitigation factors include
embankments on the upstream side of ponds aligned
with the road network to help protect the ponds from
freshwater flooding from the Fortescue River as well as
the potential to siphon or pump away freshwater which is
expected to remain on top of the brine.
Notwithstanding these measures, flooding remains a
challenge that will require ongoing monitoring and review
of pond wall design. Future mitigations that could be
implemented if flood risk increases over time include
increasing embankment heights, and improving drainage
to the upstream side of the embankment by increasing
depth of channels in front of pond walls. This would divert
water more efficiently to the south and north of the site
and through flood channels.
BCI MINERALS ANNUAL REPORT 22 / 35
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5. Biodiversity
PILLAR: ENVIRONMENTAL PROTECTION
PRINCIPLE:
OBJECTIVE:
Maximise Value,
Minimise Waste
Environmental constraints should be the primary input into the design
TARGETS:
• Reduce design footprint in the Robe River Delta Mangrove
Management Area to <20%
• Minimise impact on Short Range Endemic (SRE) habitat;
impact target of <10% (<100ha) of habitat area
• Reduce mesquite weed in project footprint by a minimum
5% per annum during the construction phase through active
management actions
The preservation of natural habitats is a primary input
in the design of the Mardie Project. To that end, BCI
commissioned several environmental studies over the
course of the year to ensure the protection of biodiversity
which included:
• Development of a groundwater monitoring network in
landward areas of the Project
• Tecticornia (shrubland vegetation) pre-clearance
surveys
•
Impact assessment for ponds in the Robe River Delta
Mangrove Management Area
• Pre-clearance turtle monitoring surveys and
development of a marine turtle monitoring program
Data was collected via groundwater surveys and studies to
enable development of a groundwater management plan
for the Project. Various survey techniques were employed
in this process which are outlined in the Effluents, Waste
and Water topic.
The benthic zone is the ecological region at the lowest level
of a body of water. As part of BCI’s benthic communities
and habitat monitoring and management plan, a
commitment was made to conduct pre-clearance surveys
of Tecticornia communities, or samphire vegetation,
to minimise the residual impacts of the Project. The
pre-clearance surveys established that less than 6% of
recorded Tecticornia species at Mardie will be impacted
by construction.
An impact assessment was conducted in the Robe River
Delta Mangrove Management Area of the Project to ensure
that best practice design, management, monitoring,
and contingency measures are being employed to avoid
significant adverse impact on the ecological function or
processes that sustain mangrove habitats. BCI is working
with the regulators and is targeting a reduction of the
Project’s footprint in the Robe River Delta Mangrove
Management Area to less than 20%.
BCI has a target to minimise the Project’s impact on the
habitat of Short-Range Endemic (SRE) fauna. Species
considered to be SRE are those with very localised ranges,
generally defined as having a range <10,000 km2.
At Mardie, spinifex grassland found on mudflat islands
was identified by fauna consultants as being possible
habitat for some invertebrate SRE. This target has been
built into the design footprint.
During the construction phase, BCI has a target to reduce
mesquite weed in the project footprint by a minimum
5% per annum through active management actions.
Mesquite is an introduced and invasive species, considered
by the World Conservation Union as one of the world’s
most problematic invasive species which impacts the
hydrological, energy, and nutrient cycling of ecosystems
and has adverse consequences for biodiversity and
primary production. BCI is working with the Pilbara
Mesquite Management Committee to finalise a Mesquite
Management Plan which will include how mesquite can be
removed from the Project footprint.
36 / BCI MINERALS ANNUAL REPORT 22
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A milestone was reached during the year when
environmental approvals were gained from state and
federal governments for Project implementation as
proposed in the Definitive Feasibility Study. Conditions
associated with the Western Australian approval, and
outlined in Ministerial Statement 1175, included the
requirement for financial offsets for marine and intertidal
research. The offsets are based on the residual impacts
and risks of the proposal to intertidal benthic communities
and habitat, namely mangroves, algal mat and coastal
samphire. The offsets were put in place for the purpose
of guiding the strategic protection and management of
the ecological values of these habitats on the west
Pilbara coast.
This offset package takes the form of a research program
that will be undertaken by an independent body, the
Western Australian Marine Science Institution (WAMSI),
for regional understanding of the Pilbara coastal
environments to inform future decision-making,
management and conservation.
The research program includes:
• Mapping of the current extent and distribution of
samphire and algal mat on the west Pilbara Coast
to complement the existing mangrove mapping.
Gaining an understanding of how these habitats have
changed over time will also inform their response to
anthropogenic and natural events.
•
Identifying and quantifying the potential effects of sea
level rise on mangroves, samphire and algal mat on the
west Pilbara Coast given the potential for the Mardie
Project (or other salt proposals) to reduce the capacity
of some intertidal benthic communities and habitat to
adapt to climate change.
•
Identifying the ecological roles, values and functions of
algal mat on the west Pilbara coast. The highest priority
habitat is algal mat as it is the least understood of the
intertidal benthic coastal habitats. In particular, very
little is known about its contribution to nutrient and
energy flow in the intertidal to subtidal system and
how this varies spatially and temporally.
A milestone was reached
during the year when
environmental approvals
were gained from state
and federal governments.
Another approval condition associated with Ministerial
Statement 1175 pertained to the protection of marine
turtles given the island chain from Mangrove Islands
to Cape Preston is recognised as foraging habitat for
green, hawksbill and flatback turtles. In response, BCI has
developed and implemented a Marine Turtle Monitoring
Program to collect pre-construction baseline data of
marine turtle nesting and hatching activity in the Mardie
Region, to further describe the nesting population and
habitat. An assessment will be conducted to determine
any impacts the Project’s artificial light emissions may
have on nesting and hatching marine turtles which
have the potential to cause the mis-orientation and/
or disorientation of marine turtles. In addition, BCI has
sponsored the Annual International Sea Turtle Symposium
to be held in Colombia in March 2023 which will bring
together more than 600 people from 70 countries,
including technical experts, researchers, government
entities, and research institutes to exchange knowledge
and propose measures to protect sea turtles.
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6. Effluents, Waste & Water
PILLAR: ENVIRONMENTAL PROTECTION + ECONOMIC VIABILITY
PRINCIPLE:
OBJECTIVE:
Maximise Value,
Minimise Waste
Environmental constraints should be the primary input into the design;
Meet or exceed environmental commitments during construction
and operation
TARGET:
Further reduce waste by commercialising or utilising additional byproducts
Sustainability is considered at every stage of the
production process by minimising the requirement to
produce energy (by harnessing solar and wind power)
and reprocessing to extract maximum value and minimise
waste (eg: the SOP byproduct from salt waste).
There are five existing solar salt operations on the Western
Australian coast, but only Mardie will reprocess salt
bitterns to produce SOP. Mardie will also recycle brine
from its salt wash plant, desalination plant and secondary
crystallisers, and is investigating further ways to minimise
bitterns discharge. These design elements assist Mardie to
maximise economic benefits and minimise waste while at
the same time preserving ecological integrity.
These design elements
assist Mardie to maximise
economic benefits and
minimise waste while at
the same time preserving
ecological integrity.
38 / BCI MINERALS ANNUAL REPORT 22
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BCI MINERALS ANNUAL REPORT 22 / 39
BCI MINERALS ANNUAL REPORT 22 / 39
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It is not just in the production process where BCI is looking
to minimise its impact on the environment. Groundwater
management is a focus area for the environmental
regulator and forms part of BCI’s Environmental
Management Plan. When undertaking groundwater
studies surrounding Mardie Pool, an area of significant
heritage value to the Mardudhunera people, BCI used
a non-invasive technology to avoid drilling traditional
monitoring bores. The survey was conducted with the
benefit of a Transient Electromagnetic system, a process
which involved two people spaced 10 metres apart with
backpack-mounted transmitter and receiver units. The
system measured the conductivity of the subsurface
material to a depth of about 25 metres with the resulting
data allowing the freshwater lens above the more
conductive saline groundwater to be defined.
In the Australian SOP production context Mardie is unique,
not just for its coastal location, but because it will be the
only SOP producer to use renewable, sustainable seawater
as feedstock, whereas domestic peers rely on the finite
resources of inland lakes and aquifers. Mardie will also be
the only domestic SOP producer to commercialise salt
(whereas peers will generate ~2.5Mtpa of waste salt on an
equivalent SOP production rate). BCI is investigating further
waste reduction opportunities including the reprocessing of
spent brine (bitterns) to produce magnesium and bromine.
When undertaking
groundwater studies
surrounding Mardie Pool,
an area of significant
heritage value to the
Mardudhunera people,
BCI used a non-invasive
technology to avoid drilling
traditional monitoring bores.
40 / BCI MINERALS ANNUAL REPORT 22
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BCI MINERALS ANNUAL REPORT 22 / 41
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7. Ground Disturbance Management
PILLAR: ENVIRONMENTAL PROTECTION + SOCIAL EQUITY
PRINCIPLE:
OBJECTIVE:
Comply with social and environmental obligations
Mitigate
Climate Change
TARGET:
No breaches
A Ground Disturbance Permitting (GDP) system is in
place at Mardie which requires all ground disturbing works
to be assessed and approved. As part of the system, all
ground disturbing works are matched against agreed
project footprints, relevant consents and any heritage and
environmental management requirements. If the ground
disturbing works will affect an Aboriginal site, senior BCI
management is required to review the status of all heritage
consents, approvals and correspondence from Traditional
Owners confirming their non-opposition to ensure
that works are only undertaken with the support of the
Traditional Owners and compliant with heritage legislation
or avoided.
BCI has a ground disturbance procedure which outlines the
minimum requirements for obtaining and implementing
a GDP for all BCI projects and operations. It is a critical
process in relation to BCI’s ability to maintain compliance
obligations throughout the life of the Project. It specifies
the requirements for the approval, management,
monitoring and auditing of ground disturbance activities
across all BCI sites and activities and is a key controlling
document within the ESMS.
The objective of the ground disturbance procedure is to
outline a process designed to:
• Minimise ground disturbance to the extent possible
• Manage ground disturbance activities in compliance
with all relevant legislative and legal obligations
• Manage ground disturbance activities within
approved boundaries
•
•
Identify all known culturally and environmentally
sensitive areas to prevent unauthorised disturbance
Identify all available topsoil for recovery and stockpiling
for later use in rehabilitation works
• Ensure all completed ground disturbance is surveyed,
recorded, and reported
Management of the GDP process involves the use of a
Geographic Information System (GIS) platform, which
tracks approved and active disturbance against Project
clearing limits imposed by the conditions in environmental
and other approvals. Quarterly flyovers to map ground
disturbance are undertaken and real time location data is
provided to employees and contractors on site via tablet
computers to ensure adherence to environmental and
heritage clearing limits.
There were no known material breaches of ground
disturbance outside permitted areas, however some
minor incidents during the period have provided input to
a strengthened set of procedures. The general induction
pack provided to all employees and contractors who work
on site includes content that clearly references the GDP
process as being a key environmental and social control in
use on the Project.
42 / BCI MINERALS ANNUAL REPORT 22
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8. Local Communities
PILLAR: SOCIAL EQUITY
PRINCIPLE:
OBJECTIVE:
Promote
Community Prosperity
Strengthen and maintain BCI’s Licence to Operate; Ensure local spend;
Encourage regional living; Promote local and Indigenous contracting
TARGET:
During the construction phase, award >$10M in contracts to Pilbara businesses
Mardie will be a multi-generational asset for northern
Australia, delivering new multi-user export infrastructure,
tax and royalty revenues, local jobs and contracts, and
Indigenous engagement. BCI’s sustainability pillar is
focused on promoting prosperity in our communities
through employment, procurement spend, support
programs, government taxes and royalties, and native
title payments. To that end, BCI implemented a new
Community Policy with the objective of securing
community support by conducting activities in a manner
that considers community issues, needs and priorities to
achieve mutually beneficial outcomes.
Having established a Pilbara office in Karratha’s CBD in
early 2021, BCI further strengthened its ties with the
community by entering into a partnership agreement with
the City of Karratha. BCI established its Partnerships and
Sponsorships Program during the year and through this
inaugural partnership BCI will support critical services and
community events in the city, provide necessary funding
to the arts, youth and Indigenous community, and help to
attract skilled workers to the region.
Community events and programs supported in 2022
include sponsorships of the FeNaClNG Festival and
Cossack Art Awards, grants targeting sporting activities
for youth and capacity building in Indigenous communities,
and the Medical Services Housing Subsidy scheme.
The housing scheme is designed to remove the barrier
of high rental costs which deter health professionals
considering employment in Karratha.
BCI also sponsors and is present at local community
events such as Community Business Breakfasts, Business
Afterhours events, Grow Local events and Indigenous
Business Networking events run by the City of Karratha,
the Karratha and Districts Chamber of Commerce and
Industry (KDCCI) and the Onslow Chamber of Commerce
and Industry. In addition, BCI has aided sponsorship of
the training and establishment of two rangers as part
of its Wirrawandi Aboriginal Corporation Ranger
Program Partnership.
With BCI’s sustainability pillars of minimising waste,
promoting community prosperity and providing a
safe environment in mind, BCI’s team at the Mardie
Village has partnered with Containers for Change and to
date have diverted more than 30,000 containers from
landfill. For every eligible container recycled at Mardie
Village during the year, 10 cents was donated to
Beyond Blue to help fund their work providing anxiety,
depression and suicide prevention support.
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44 / BCI MINERALS ANNUAL REPORT 22
44 / BCI MINERALS ANNUAL REPORT 22
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9. Indigenous Peoples & Cultural Heritage
PILLAR: SOCIAL EQUITY
PRINCIPLE:
OBJECTIVE:
Strengthen relationships with Indigenous people
Promote
Community Prosperity
TARGETS:
• No heritage breaches;
• 5% Indigenous employment in FY23
A significant occasion was marked in October 2021
when the official Welcome to Country ceremony for
the Mardie Salt & Potash Project took place on site.
The ceremony was led by four elders of the Yaburara
and Mardudhunera People and represents an essential
step toward the implementation of the Project.
BCI’s relationship with the
Wirrawandi Aboriginal
Corporation (WAC), the
prescribed body corporate
of the Traditional Owners
of Mardie, was further
strengthened during the
year through its Ranger
Program Partnership.
BCI’s relationship with the Wirrawandi Aboriginal
Corporation (WAC), the prescribed body corporate of the
Traditional Owners of Mardie, was further strengthened
during the year through its Ranger Program Partnership.
The partnership will see BCI become one of the sponsors
of two full-time Aboriginal rangers, employed by WAC,
and provide them with formal qualifications over a
minimum of four years as well as assistance in establishing,
coordinating and developing the program. The rangers will
educate young people in their communities about natural
resource management, traditional ecological knowledge,
the importance of caring for country, and will encourage
relationships with community elders. The program
is also designed to provide health and well-being,
economic, cultural and educational outcomes for
the individual rangers.
Collaboration between WAC and BCI was instrumental
in Mardie being the sole project proponent for the
proposed Port of Cape Preston West. This is the result
of the Port of Cape Preston West Indigenous Land Use
Agreement (ILUA), a tripartite agreement between WAC,
the Western Australian Government and BCI which
provides the necessary native title consents to allow
the WA government to formally create a port reserve at
Cape Preston West. Importantly, WAC’s agreement to the
creation of the port reserve at Cape Preston West is based
on the non-extinguishment principle which suppresses
rather than extinguishes native title – a positive result for
all parties and one that is welcomed by the Yaburara and
Mardudhunera people.
The strong relationship BCI has with the Traditional Owners
of Mardie was enhanced by its decision to amend the
design of the Mardie Access Road to avoid and preserve an
Aboriginal heritage site. The heritage site is now a striking
feature of what would otherwise have been a straight road
and symbolises the respect BCI has for Aboriginal culture
and heritage.
BCI has comprehensive native title and heritage
agreements in place with its two native title holder
stakeholders, the Yaburara and Mardudhunera People via
the Wirrawandi Aboriginal Corporation (WAC) and the
Kuruma Mardudhunera People via the Robe River Kuruma
Aboriginal Corporation (RRKAC).
Consultation with Mardie’s Traditional Owners was key to
the development of BCI’s new Cultural Heritage Policy,
Cultural Heritage Management Plan, Cultural Awareness
training and Reconciliation Action Plan (Reflect) during the
period. These, together with BCI’s Indigenous Engagement
Strategy, formalise and document the relationships BCI has
forged with Indigenous people and outlines the aspirations
it has for the future.
BCI MINERALS ANNUAL REPORT 22 / 45
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10. Procurement Practices & Employment
PILLAR: SOCIAL EQUITY + ECONOMIC VIABILITY
PRINCIPLE:
OBJECTIVE:
Ensure local spend; Encourage regional living;
Promote local and indigenous contracting
Promote
Community Prosperity
TARGETS:
Provide a
Safe Environment
• During the construction phase, award >$10M
to Pilbara businesses with >$2M in contracts to
registered Traditional Owner groups annually;
• 5% employment of Indigenous Australians
in FY23
The Mardie Project’s Australian Industry Participation (AIP)
Plan is considered when awarding all contracts, particularly
contracts less than $1 million where local contractors and
suppliers are given a local price preference. A hierarchy
prioritising Traditional Owner, Pilbara Indigenous and
Pilbara contractors and suppliers is in place for like-for-like
tender and cost estimate submissions. Over the course of
the 2022 financial year, BCI spent more than $10 million
with approximately 40 different Pilbara suppliers,
meeting its target in this regard.
BCI incorporates
Aboriginal employment
and contracting
considerations as
part of the selection
criteria in competitive
tender processes.
BCI incorporates Aboriginal employment and contracting
considerations as part of the selection criteria in
competitive tender processes. The engagement of
Aboriginal and local sub-contractors and individuals
is weighted in tender selection criteria to advantage
contractors with Aboriginal and local engagement
strategies and a history of Aboriginal and local sub-
contractor engagement.
Communication of BCI opportunities and Project updates
for those considered to be vulnerable persons are also
conducted through engagement with various Pilbara
organisations that provide jobs, training, support and
operation of social initiatives for vulnerable persons
within the Pilbara community. As part of BCI’s Indigenous
Engagement Strategy, as positions become available
at Mardie, BCI will provide notice to the Yaburara and
Mardudhunera and Kuruma Marthudunera People through
the Implementation Committees or alternate means.
The attraction and retention of talent is critical to BCI’s
ongoing success, and during the year BCI commenced
a cultural transformation program to enable its business
strategy and the delivery of the Mardie Project through
an engaged and productive workforce. Significant
employment opportunities associated with the Mardie
Project include approximately 500 construction jobs,
220 ongoing operating jobs at the conclusion of the
construction phase, and indirect jobs in the region.
46 / BCI MINERALS ANNUAL REPORT 22
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In response to the requirements of the Modern Slavery
Act 2018 (Cth), BCI released its inaugural Modern Slavery
Statement in December 2021. The statement details
the steps BCI has taken to identify key risks across its
supply chain, operations and investments and the actions
being taken to help manage these risks. As part of the
assessment, BCI undertook a Human Rights Impact
Assessment (HRIA) to identify potential salient human
rights risks and impacts associated with the Mardie Project.
The assessment was guided by the United Nation Guiding
Principles (UNGPs) on Business and Human Rights, and the
requirements set out in the Equator Principles.
The HRIA identifies actual and potential human rights risks
and impacts, including vulnerable people/groups that may
be at risk. Existing Company practices and management
measures in relation to human rights risks and impacts are
clearly identified, and specific recommendations are listed
in the HRIA as to actions that BCI should take to further
mitigate potential human rights impacts and risks.
Some of the key existing measures that are identified as
already in place or planned, and which the HRIA notes
should involve ongoing monitoring and evaluation include:
• Engagement with key stakeholders throughout the life
of the Project
• Active management of agreements with Traditional
Owners and pastoralists
• Security management measures, particularly at
the port
• Cultural Heritage Management Plan and Policy
• Water management measures.
Subsequently, BCI has commenced using a self-
assessment questionnaire as part of its procurement
process. The use of the questionnaire has assisted BCI in
understanding the stage of development of the proposed
contractors’ modern slavery risk management systems,
and BCI will use this information to tailor BCI’s approach to
managing modern slavery risk with selected contractors.
The BCI Board approved a new Human Rights Policy in
August 2022 and training for the workforce in Human
Rights issues will take place in the 2023 financial year.
BCI MINERALS ANNUAL REPORT 22 / 47
BCI MINERALS ANNUAL REPORT 22 / 47
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Corporate Governance
BCI MINERALS HAS ADOPTED A CORPORATE GOVERNANCE FRAMEWORK WHICH FORMS
THE BASIS OF A COMPREHENSIVE SYSTEM OF CONTROL AND ACCOUNTABILITY FOR THE
ADMINISTRATION OF CORPORATE GOVERNANCE, THROUGH ITS BOARD, ITS SUBCOMMITTEES
AND THE EXECUTIVES.
The BCI Board is committed to fostering an appropriate
culture through administering the policies and procedures
with openness and integrity and pursuing the true spirit
of corporate governance commensurate with the
Company’s needs.
To the extent they are applicable to the Company, the
Board has adopted the ASX Corporate Governance
Council’s Corporate Governance Principles and
Recommendations (4th edition).
BCI’s Corporate Governance Statement is available on the
corporate website together with the Company’s:
• Code of Conduct
• Charters
• Policies
The Company reviews its Corporate Governance
Framework and policies annually to ensure they reflect
any changes within the Company, or accepted principles
and good practice.
Corporate Governance Framework
BOARD OF DIRECTORS
Project Review
Committee
Co-Secretary/
General Counsel
Committee
Remuneration and
Nomination
Committee
Audit and Risk
Committee
Sustainability
Committee
PRC Charter
RNC Charter
Board Charter
ARC Charter
STC Charter
Recommend and
Oversee Policies:
13. Disclosure Policy
14. Shareholder
Communications
Policy
15. Shade Trading
Policy
Recommend and
Oversee Policies:
11. People Policy
12. Diversity Equity and
Inclusion Policy
• Remuneration
Framework
Recommend and
Oversee Policies:
3. Health and Safety
Policy
4. Environment Policy
5. Community Policy
6. Privacy Policy
7. Whistleblower
Policy
8. Anti-Bribery and
Corruption Policy
9. Cultural Heritage
Policy
10. Human Rights
Policy
Approved Policies:
1. Code of Conduct
2. Risk Management
Policy
Recommend and
Oversee Policies:
1. Code of Conduct
2. Risk Management
3. Health and Safety
Policy
Policy
4. Environmental
Policy
5. Community Policy
6. Privacy Policy
7. Whistleblower
Policy
8. Anti-Bribery and
Corruption Policy
9. Cultural Heritage
Policy
10. Human Rights Policy
11. People Policy
12. Diversity Equity and
Inclusion Policy
13. Disclosure Policy
14. Shareholder
Communications
Policy
15. Share Trading Policy
Managing Director
/ Chief Executive
Officer
>100 Guidelines, Standards and Procedures to Ensure Compliance with Policies
Project Review Committee
Remuneration and Nomination Committee
Audit and Risk Committee
Sustainability Committee
Chair
Garrett Dixon
Garrett Dixon
Michael Blakiston
Chris Salisbury
Members
Chris Salisbury
Miriam Stanborough
Michael Blakiston
Brian O’Donnell
Brian O’Donnell
Richard Court
Richard Court
Mirian Stanborough
48 / BCI MINERALS ANNUAL REPORT 22
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CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Risk Management
BCI’s Risk Management Policy is enabled through its
Risk Management Framework which is aligned to the
International Standard for risk management, ISO 31000.
BCI manages its activities within budgets and operational
and strategic plans. BCI acknowledges that there is risk
associated with all business activity and the Board works
with senior management to safeguard assets, protect
the health and safety of its workforce, maintain budgets
and access to funds, maintain its licence to operate
through upholding environmental, community and social
obligations and ensuring regulatory compliance.
The Risk Management Framework aims to drive an
effective risk management culture by establishing
a process for regular review of business activities to
objectively identify, evaluate, monitor, review and
report risks.
The Audit and Risk Committee assists the Board with
oversight of BCI’s risk management activities and reviews
key corporate risks at least annually.
BCI has established a cyclical risk review and reporting
process and has embedded an integrated risk model. The
integrated risk model considers vertical risk integration of
risks within a department and horizontal integration where
risks integrate across departments. BCI’s risk profile is
actively managed by undertaking:
• Monthly Risk & Compliance Summary prepared by
BCI’s Risk and Compliance Manager and reported to the
Managing Director and Board
• Monthly executive review of BCI’s top risks with a
residual risk rating of high and very high
• Quarterly risk reviews undertaken by departmental
teams and monthly project risk reviews
• Quarterly executive team risk alignment and
integration workshops
• Regular review of the risk registers and risk
management activities by the Audit & Risk Committee
and the Board
Licence to Operate
BCI’s commitment to sustainable business practices are
imbedded through its values and founded in the various
legislative requirements, approvals held or to be held by
BCI, and contractual rights and benefits granted to BCI
under agreements with third parties.
BCI is committed to preserving its licence to operate
and ensuring compliance with the licence to operate
obligations relating to matters such as:
•
land access and native title
• Heritage protection
•
•
tenure compliance
environmental compliance
• pastoral access
•
•
community engagement
stakeholder engagement
• other legislative requirements relevant to BCI’s business
and the Project.
A culture of care and high-quality performance is the goal,
with a target of zero material breaches of BCI policies and
its licence to operate obligations.
Monthly compliance reviews are carried out against BCI’s
licence to operate with the obligation owner and any
breaches are then reported in the Risk & Compliance
Summary which is then incorporated into the monthly
Managing Director’s Report and reported to the Board.
There were no material breaches of BCI’s licence to operate
during the reporting period.
A culture of care and high-
quality performance is the
goal, with a target of zero
material breaches of BCI
policies and its licence to
operate obligations.
BCI MINERALS ANNUAL REPORT 22 / 49
BCI MINERALS ANNUAL REPORT 22 / 49
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
50 / BCI MINERALS ANNUAL REPORT 22
50 / BCI MINERALS ANNUAL REPORT 22
04 CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Directors’ Report
THE DIRECTORS PRESENT THEIR REPORT ON THE RESULTS OF THE CONSOLIDATED ENTITY
(REFERRED TO HEREAFTER AS THE COMPANY) CONSISTING OF BCI MINERALS LIMITED (“BCI”)
AND THE ENTITIES IT CONTROLLED AT THE END OF, OR DURING THE YEAR ENDED 30 JUNE 2022.
Principal Activity
The principal activities of the Company during the course of
the financial year were the development and operation of
assets in the Pilbara region of Western Australia, primarily
focused on the Mardie Salt & Potash Project and Iron Valley
Iron Ore Mine.
There has been no significant change in the nature of the
Company’s activities during the financial year.
Directors
The names of directors of the Company in office during the
financial year and up to the date of this report are:
Brian O’Donnell
Chair (Non-Executive)
Alwyn Vorster
Managing Director (Executive) (a)
Michael Blakiston
Director (Non-Executive)
Garret Dixon
Director (Non-Executive)
Richard Court
Director (Non-Executive)
Chris Salisbury
Director (Non-Executive)
Miriam Stanborough Director (Non-Executive) (b)
Jenny Bloom
Director (Non-Executive) (c)
(a) Mr Alwyn Vorster gave notice of his resignation to the
Company on 15 July 2022.
(b) Ms Miriam Stanborough was appointed as a Director of
the Company on 14 June 2022.
(c) Ms Jenny Bloom resigned as a Director of the Company
on 20 December 2021
BCI MINERALS ANNUAL REPORT 22 / 51
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Directors’ Qualifications, Experience
And Special Responsibilities
MS JENNY BLOOM
GRAD. DIP BUSINESS ADMINISTRATION, GAICD
MR BRIAN O’DONNELL
B COM, FCA, MAICD
Chair (Non-Executive) appointed as a Director October 2014
Period of office at August 2022 – 7 years and 10 months
In addition to being Chair of BCI, Mr O’Donnell is Director,
Finance and Investments for the Australian Capital Equity
Pty Limited (ACE) group, which includes BCI’s largest
shareholder, Wroxby Pty Ltd. He is a director of various
ACE group companies, including companies active in the
property, food, agricultural and investment sectors.
Mr O’Donnell is a non-executive director of Bravo Holdco
Pty Ltd (the holding company for Hive and Wellness
Australia Pty Ltd - formerly Capilano Honey Limited), the
West Australian Football Commission and The Guide Dog
Foundation Pty Ltd (WA). He is a former director of Iron Ore
Holdings Limited, Coates Group Holdings Pty Ltd, WesTrac
Pty Ltd, Landis & Gyr AG, SocietyOne Holdings Pty Ltd and
Fremantle Football Club Ltd. He is a Fellow of the Institute
of Chartered Accountants and has 37 years’ experience in
the finance and investment industry.
Mr O’Donnell is a member of the Audit and Risk Committee
and the Remuneration and Nomination Committee.
MR ALWYN VORSTER
BSC (HONS) GEOLOGY, MSC (MINERAL ECONOMICS) AND MBA
Managing Director appointed 22 September 2016,
notice of resignation provided on 15 July 2022
Period of office at August 2022 – 5 years and 11 months
Mr Vorster commenced as Chief Executive Officer of
BCI in May 2016 and was appointed as Managing Director
in September 2016. He has more than 25 years’ experience
with numerous large mining houses in technical and
commercial management roles covering the total supply
chain from mine to market for iron ore, coal and
other minerals.
Recent roles include Chief Executive Officer of
API Management and Managing Director of Iron Ore
Holdings Ltd.
Director (Non-Executive) appointed March 2017, resigned
20 December 2021
Period of office – 4 years and 9 months
Ms Bloom has an extensive business background with
experience in the public and private sectors in Western
Australia and Victoria. She was most recently the Deputy
Chair and Member of the Waste Authority Western
Australia for eight years and was a member of the Program
and Risk Committee. She is a non-executive director of
Breaking the Silence (Inc) and is a director of various private
businesses. Ms Bloom previously held an elected position
as a Councillor and Deputy Shire President for the Shire of
Broome and as an independent director of a Broome based
Aboriginal Corporation.
Ms Bloom also held the role of Chair of the Remuneration
and Nomination Committee until her resignation.
MR MICHAEL BLAKISTON
B. JURIS LLB
Director (Non-Executive) appointed March 2017
Period of office at August 2022 – 5 years and 5 months
Mr Blakiston is a partner in Gilbert + Tobin’s Energy and
Resources group. He has over 35 years’ experience across
a range of jurisdictions. He advises in relation to asset
acquisition and disposal, project structuring, joint ventures
and strategic alliances, development agreements and
project commercialisation, capital raisings and company
merger and acquisitions.
Mr Blakiston has served on numerous ASX listed companies
and not-for-profit boards and is currently the Chair of
Develop Global Limited and Precision Opportunities Fund
Ltd, an unlisted specialist small to medium cap fund.
Mr Blakiston is the Chair of the Audit and Risk Committee,
and is a member of the Remuneration and Nomination
Committee.
52 / BCI MINERALS ANNUAL REPORT 22
BCI MINERALS ANNUAL REPORT 22 / 52
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
MR GARRET DIXON
Director (Non-Executive) appointed 18 June 2020
MS MIRIAM STANBOROUGH
BA(HONS), BE(HONS), MSC, MAUSIMM, GAICD
Period of office at August 2022 – 2 years and 2 months
Director (Non-Executive) appointed 14 June 2022
Period of office at August 2022 – 2 months
Ms Stanborough is a chemical engineer with more than
20 years’ experience in the mineral processing industry
across various commodities including copper, uranium,
gold, silver, alumina, mineral sands and lithium. She
has previously held senior roles at Monadelphous,
Iluka Resources, Alcoa and WMC Resources across
innovation and technology, technical development,
production management, project management, business
improvement, and human resources portfolios.
Ms Stanborough is currently a Non-Executive Director
of Pilbara Minerals Limited (ASX:PLS), the Chair of the
Minerals Research Institute of Western Australia (MRIWA),
Director of ChemCentre, Deputy Chair of the Northern
Agricultural Catchments Council (NACC NRM), and the
Deputy Chair of Scouts WA.
Ms Stanborough was appointed as a member of the
Sustainability Committee and as a member of the Project
Review Committee.
Company Secretary
MS SUSAN PARK
BCOM, ACA, F FIN, FGIA; FCG; GAICD
Joint Company Secretary appointed July 2018
Ms Park has over 25 years’ experience in the corporate
finance industry and extensive experience in company
secretarial and non-executive director roles with ASX, AIM
and TSX listed companies. Ms Park is currently Company
Secretary of several ASX listed companies.
MRS STEPHANIE MAJTELES
LLB(HONS), GAICD
Joint Company Secretary appointed 30 June 2021
Mrs Majteles has over 18 years’ experience in the projects
and resources industries, with significant experience at
both a top tier law firm and in-house at a large global
resources company.
Mr Dixon has over 40 years of industry experience in the
areas of mining, construction, contracting, civil engineering
and bulk commodity logistics. Until recently, Mr Dixon
held the position of Executive Vice President and President
Bauxite of NYSE listed Alcoa Corporation, where he
was responsible for the global bauxite mining business
including seven bauxite mines on various continents.
His other experience includes positions as a Non-Executive
Director of Watpac Limited, Managing Director at Gindalbie
Metals Limited and Executive General Manager for Henry
Walker Eltin (HWE).
Mr Dixon is the Chair of the Remuneration and Nomination
Committee and Chair of the Project Review Committee.
MR RICHARD COURT
Director (Non-Executive) appointed 28 January 2021
Period of office at August 2022 – 19 months
Mr Court had served as Australia’s Ambassador to Japan
from 2016 to 2020. He was also Premier and Treasurer
of Western Australia from 1993 to 2001. His other previous
corporate experience includes Chair of GRD Ltd,
Chair of Iron Ore Holdings Ltd, Chair of National Hire Ltd,
Chair of RISC Advisory Pty Ltd and Director of WesTrac
Equipment Pty Ltd.
Mr Court is a member of the Audit and Risk Committee
and the Sustainability Committee.
MR CHRIS SALISBURY
Director (Non-Executive) appointed 28 May 2021
Period of office at August 2022 – 15 months
Mr Salisbury is a metallurgical engineer with more than
30 years of operational experience across a diverse
range of commodities. From 2016 to 2020, he was Chief
Executive at Rio Tinto Iron Ore responsible for optimising
operations, developing and implementing the company’s
climate change program and improving safety culture and
operational performance of a team comprising ~20,000
employees and contractors, across a network of 16 mines,
4 ports and other significant infrastructure. In this role, he
was also responsible for the management of Rio Tinto’s salt
business (Dampier Salt) which has the capacity to produce
10Mt of industrial salt per annum from 3 operations.
Mr Salisbury is the Chair of the Sustainability Committee
and a member of the Project Review Committee.
BCI MINERALS ANNUAL REPORT 22 / 53
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Meetings of Directors
The number of meetings held during the year and the number of meetings attended by each director was as follows:
Board
Audit and Risk
Committee 1
Remuneration
and Nomination
Committee 2
Project Review
Committee 3
Sustainability
Committee 4
Total Number of
Meetings
B O’Donnell
A Vorster
M Blakiston
J Bloom 5
G Dixon
R Court
C Salisbury
M Stanborough 6
Held
Attended
Held
Attended
Held
Attended
Held
Attended
Held
Attended
13
13
13
8
13
13
13
1
13
13
13
8
12
12
13
1
4
-
4
-
-
4
-
-
4
-
4
-
-
4
-
-
-
3
1
2
3
-
-
-
-
3
1
2
3
-
-
-
-
6
-
-
6
-
6
-
-
6
-
-
6
-
6
-
-
3
-
-
-
3
3
-
-
3
-
-
-
3
3
-
1 Members of the Audit and Risk Committee during the financial year ended 30 June 2022 were M. Blakiston (Chair), B. O’Donnell (Member) and
R. Court (Member) from date of appointment.
2 Members of the Remuneration and Nomination Committee during the financial year ended 30 June 2022 were J Bloom (Chair) until her resignation,
G Dixon (Chair) appointed to the Chair position on 31st December, A Vorster (Member).
3 Members of the Project Review Committee during the financial year end 30 June 2022 were G. Dixon (Chair), A. Vorster (Member) and C. Salisbury
(Member) from date of appointment.
4 Members of the Sustainability Committee during the financial year 30 June 2022 were C. Salisbury (Chair), R. Court (Member) and A. Vorster
(Member).
5 J Bloom resigned from the company on 20th December 2021.
6 M Stanborough was appointed as an independent Non-executive Director of the Company on 14 June 2022.
Corporate Governance
In recognising the need for high standards of corporate behaviour and accountability, the Directors of BCI Minerals
Limited support and have adhered to the ASX Corporate Governance Council’s Corporate Governance Principles and
Recommendations. The Company’s detailed corporate governance policy statement can be found on the Company’s web site
at www.bciminerals.com.au.
Directors’ Interests and Benefits
The relevant interest of each Director in the shares, Performance Rights and options over shares issued by the Company at
the date of this report is as follows:
Director
Ordinary shares
Performance Rights
Share Rights
Direct
Indirect
Direct
B O’Donnell
A Vorster
M Blakiston
J Bloom 1
G Dixon
R Court
C Salisbury
-
-
-
159,768
-
-
-
M Stanborough
5,896
1,156,254
7,768,642
-
-
-
819,768
-
-
Total
165,664
9,744,664
1 J Bloom resigned from the company on 20th December 2021.
-
-
-
-
-
-
-
-
-
Indirect
112,219
4,024,082
64,125
-
67,688
81,309
85,826
-
4,435,249
Direct
Indirect
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
54 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Dividends
No dividends have been declared in relation to the year
ended 30 June 2022 (June 2021: Nil).
Rounding of Amounts
The Company is of a kind referred to in ASIC Corporations
(Rounding in Financials/Directors’ Reports) Instrument
2016/191, relating to the ‘rounding off’ of amounts in the
Directors’ Report. Amounts in the Directors’ Report have
been rounded off in accordance with that Class Order to
the nearest thousand dollars, or in certain cases, to the
nearest dollar.
Review of Operations
BCI is an Australian-based company that is developing
a salt and potash business supported by iron ore
royalty earnings.
SAFETY PERFORMANCE
BCI is committed to providing a safe working environment
for all staff and contractors and has been focused on
incident prevention programs including critical control
implementation. No lost time injuries (LTIs) have been
recorded for more than seven years and the lost time
injury frequency rate (LTIFR) at 30 June 2022 was zero
(June 2021: 0.0). During the year, there was 1 recordable
injury and the total recordable injury frequency rate (TRIFR)
for the year is 4.1 (June 2021: 7.3).
Mineral Resources Limited is responsible for Occupational
Health and Safety matters at Iron Valley and therefore BCI
does not report safety performance for the Iron Valley site.
OPERATIONS
Mardie Salt & Potash Project
BCI made significant progress on its 100% owned
Mardie Salt & Potash Project during the year with key
environmental approvals attained and funding secured to
enable main construction to commence in February 2022.
Mardie approval and tenure targets were achieved during
the period including environmental approvals gained
from both the State and Federal Governments for the
Definitive Feasibility Study (DFS) development footprint.
In November 2021 the Western Australian Minister for
Environment approved the implementation of the Mardie
Project which was supported by the environmental
approval notice issued by the Commonwealth
Government’s Department of Water, Agriculture and
Environment (DAWE) in January 2022.
The Port of Cape Preston West Indigenous Land Use
Agreement (ILUA) was executed during the period
allowing the creation of a new port reserve. The ILUA is a
tripartite agreement between the Wirrawandi Aboriginal
Corporation (WAC), the Western Australian Government
and BCI. The Mardie port facilities will be located within
and adjacent to the Cape Preston West port land and
the Pilbara Ports Authority (PPA) has approved the
Development Application for these facilities.
Access agreements were executed in December 2021
with gas pipeline operators Santos and Chevron whose
Varanus Island Gas Pipeline and Gorgon Domestic Gas
Pipeline cross the southern area of the Project. These
agreements lifted the objections to Mining Leases after
which all secondary approvals required for construction
to commence were granted, namely the Mardie Mining
Proposal, the Part V Works Approval and consents under
Section 18 of the Aboriginal Heritage Act 1972.
Additional Mardie tenements acquired after the DFS-
based Environmental Review Document (ERD) submission
will allow for a layout optimisation and expansion of
production. This optimisation and expansion area outlined
in the Optimised Feasibility Study (OFS) will be subject to
further environmental assessment and approvals, which
are expected to be received over the next 6-12 months.
On site at Mardie, construction of the 400-bed
accommodation village is nearing completion, with all
accommodation rooms in place, occupation certificates
in hand for 300 rooms and internal fit-out of the central
facility buildings underway. It is anticipated that the village
will be operating at full capacity by the December quarter
of FY23.
The base structure of the seawater intake station is
substantially complete, with all piling installed, concrete
and steel structural elements underway and the installation
of six pumps with 3,000 litres/second capacity scheduled
in the first half of FY23. Commissioning of the seawater
intake station is anticipated in December 2022, a notable
milestone which will enable these components of the
Mardie Project to transition from construction to operation
in CY23.
BCI MINERALS ANNUAL REPORT 22 / 55
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ANNUAL
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AUDITOR’S
REPORT
All package designs have been significantly developed, and
numerous packages have been market tested or tendered
as at the date of this report. While some of the larger fixed
price packages have been awarded within Final Investment
Decision (FID) budget, such as the marine contract with
McConnell Dowell, market pricing for fuel and labour-
intensive civil work has increased substantially in the last 12
months, and ongoing design development is also expected
to result in increased costs.
Given ongoing market volatility, BCI is assessing the
appropriate design, delivery method and timeframe of
Project Mardie. Until this assessment is completed,
BCI has decided to defer the award of selected new
contracts at Mardie, while continuing to construct existing
awarded contracts.
These awarded contracts include the seawater intake
station, Ponds 1 to 5, Mardie Village and supporting
infrastructure, as well as important ongoing front end
engineering design on key project components to improve
design maturity and price confidence.
BCI will provide a further update following conclusion of
these assessments.
Large sections of the Pond 1 and Pond 2 levee system have
been completed, with a contract extension awarded to
SRG Global to construct the remaining walls and levees.
The earthworks contract for Ponds 3, 4 and 5 has been
awarded to QH&M Birt (Q-Birt), an Australian company
with a 40-year history in the construction industry.
The contract includes the construction of evaporation
ponds 3, 4 and 5, the earthworks required for transfer
pump stations 3 to 4 and 5 to 6 and the installation and
commissioning of groundwater monitoring wells parallel to
the gas pipeline corridor. Q-Birt has mobilised to site and
has commenced construction.
The largest direct capital works contract for the Project
was awarded during the period to McConnell Dowell
Constructors (Australia) Pty Ltd for the ~$190M marine
structures package. The design and construct package
includes jetty structure, transhipper mooring equipment,
material handling system and navigation aids. The marine
structures are on track against plan with 100% of jetty
design received and 60% of mechanical designs completed.
On the funding front, in the first half of FY22 BCI raised
$360M of equity via a strongly supported $240M
placement of new shares to institutional investors, an
oversubscribed share purchase plan raising $20.6m and
the provision of up to $100M in convertible notes by
AustralianSuper.
The first half of FY22 also saw BCI receive commitments
for commercial debt facilities totalling $310M (including
a $140M construction loan facility and $170M facilities
for cost overruns and guarantee requirements from lead
financiers. Establishment of these facilities, together with
the project finance commitments obtained from the
Northern Australia Infrastructure Facility ($490M) and
Export Finance Australia ($110M), will be progressed in line
with finalisation of the current design and cost review.
As the second half of FY22 progressed, considerable cost
increases became evident across the Mardie construction
packages. Market rate inflation has seen labour, materials,
equipment and consumables prices significantly impacted
over the last 12 months. In addition, BCI expects increased
costs associated with Project design changes required to
comply with third party approvals and is considering other
design changes to improve the long-term resilience of the
Project to extreme weather events.
56 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Iron Valley Iron Ore Mine
The Iron Valley Mine is operated by Mineral Resources Limited (“MIN”) under an ore purchase agreement with BCI. MIN
operates the mine at its cost and purchases iron ore from BCI at the mine gate at a price linked to MIN’s received sales price.
BCI is responsible for paying third party royalties and securing key approvals.
During the financial year MIN shipped 4.8 million wet metric tonnes (“M wmt”) (June 2021: 6.1M wmt), which generated
revenue for BCI of $65.2M (June 2021: $160.2M) and EBITDA of $27.8M (June 2021: $69.5M).
Iron Valley Shipments (M wmt)
Iron Valley EBITDA ($M)
10
8
6
4
2
0
FY16
FY17
FY18
FY19
FY20
FY21
FY22
64.0
54.0
44.0
34.0
24.0
14.0
4.0
FY16
FY17
FY18
FY19
FY20
FY21
FY22
Other Assets
BCI owns 7% of Highfield Resources Limited and 13% of Agrimin Limited shares, with a combined market value of $38.7M as
at 30 June 2022, as well as deferred consideration and royalties receivable from Bungaroo South, Kumina and other iron ore
assets. BCI also owns an interest in the Carnegie Potash Project, an SOP exploration project located approximately 220km
north-east of Wiluna. BCI currently owns 30% in this joint venture with Kalium Lakes Limited (“KLL”) and has rights to earn
up to a 50% interest. KLL, the joint venture manager, recently validated the design process after successfully producing
commercially saleable SOP, and continues to progress the production output.
Environmental Regulation
BCI is committed to minimising its environmental impact, with an appropriate focus on continuous monitoring of
environmental matters and compliance with environmental regulations.
BCI’s exploration, mining and development activities are the subject of various State and Commonwealth environmental
regulations. Compliance with these environmental regulations is managed through the Environment and Social Management
System (“ESMS”) and a series of other tools used to identify, analyse and control key risks associated with the environmental
impact from the Company’s activities. A compliance program is implemented on an annual basis to ensure appropriate
records are being maintained and periodic reviews (inspections and audits) are conducted to assess performance against
regulatory conditions and the requirements of the ESMS.
During the year, BCI submitted a number of reports and compliance statements to State regulatory bodies detailing BCI’s
performance against granted approvals. This includes all Annual Environmental Reports and Annual Compliance Reports,
which were all submitted on time and endorsed by the regulators.
There have been no material breaches of the Company’s licences, permits and approvals during the financial year.
BCI MINERALS ANNUAL REPORT 22 / 57
BCI MINERALS ANNUAL REPORT 22 / 57
CONTENTS
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REPORT
CONTENTS
CHAIR’S LETTER
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INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Review of Results
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
The Company’s loss after income tax for the financial year ended 30 June 2022 was ($15.5M) (profit June 2021: $22.0M) arising
due to an increase in the development of the Mardie Project and reduced royalty returns realised from the Iron Valley Mine.
The following table provides a summary of the Company’s consolidated statement of profit or loss:
Revenue
EBITDA
Interest, tax, depreciation and amortisation
Impairment of assets
Net (loss) / profit after tax
30 June 2022
$M
30 June 2021
$M
65.2
(10.4)
(5.1)
-
(15.5)
160.2
28.9
(4.7)
(2.2)
22.0
The Company’s EBITDA for the financial year ended 30 June 2022 was ($10.4M) (June 2021: $28.9M), which incorporates a
positive EBITDA from Iron Valley of $27.8M (June 2021: $69.5M) and increased investment in the Mardie project of $20.6M
(June 2021: $34.4M).
The following table shows the EBITDA contribution for each segment (Note 22) of the Group:
Iron Valley
Gains from divestments
Mardie
Other
Total EBITDA
30 June 2022
$M
30 June 2021
$M
27.8
-
(20.6)
(17.6)
(10.4)
69.5
-
(34.4)
(6.2)
28.9
CONSOLIDATED STATEMENT OF CASH FLOWS
Cash and cash equivalents as at 30 June 2022 increased to $232.0M (June 2021: $79.4M) with the positive movement
resulting from the $260M (June 2021: $47.9M) capital raising completed in the year and receipts from Iron Valley.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Net assets increased to $434.2M (June 2021: $172.7M) primarily due to the increase in cash and receivables held by the Group
from the capital raising completed.
DIVIDENDS
The Directors have not paid or declared any dividends since the commencement of the financial year ended 30 June 2022.
(a) out of the profits for the year ended 30 June 2022 and retained earnings on fully
paid ordinary shares
(b) out of the profits for the year ended 30 June 2021 and retained earnings on fully
paid ordinary shares.
CORPORATE
2022
Nil
Nil
2021
Nil
Nil
Annual General Meeting
The Company’s annual general meeting was held in Perth on 25 November 2021. All ten resolutions considered at the
meeting were passed.
Successful Completion of Capital Raising
On the 18th of November 2021, the Company announced a $360M capital raising to develop the 100% owned Mardie Salt
and Potash Project. The equity raising was successfully completed in December 2021.
Executive Team Appointments in FY22
BCI appointed Kerryl Bradshaw as Chief Financial Officer, and Kim Boekeman as Head of People and Culture in the March
Quarter of FY22.
58 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Performance Rights and Share Rights
As at the date of this report, there were 12,885,203 Performance Rights and 2,342,335 Share Rights on issue to Directors
and Employees under the Performance Right Plan and Share Right Plan, both approved at the November 2019 AGM
(30 June 2021: Performance Rights 13,253,241 and Share Rights 2,456,005). During the financial year, no performance rights
vested while 1,300,000 performance rights were either cancelled or lapsed. During the financial year 2,402,911 share rights
vested. Subsequent to the year end, a total of 1,910,375 performance rights vested and 3,116,928 were cancelled. Refer to
the Remuneration Report for further details of Performance Rights and Share Rights outstanding.
No Performance Right or Share Right holder has any right to be provided with any other share issue of the Company by
virtue of their Performance Rights or Share Rights holding.
None of the Performance Rights or Share Rights are listed on the ASX.
SHARES ISSUED AS A RESULT OF CONVERSION OF PERFORMANCE RIGHTS AND SHARE RIGHTS
During the financial year, 849,796 ordinary shares were issued following conversion of share rights that vested during the year.
Subsequent to year end, the Company has issued 2,780,337 ordinary shares following the conversion of performance and
share rights.
Likely Developments and Expected Results
The Company will continue construction works at Mardie, and aims to finalise funding arrangements for the Mardie Project
following completion of the current cost and design reviews.
BCI expects to generate ongoing revenue and EBITDA from Iron Valley during the 2023 financial year. The Company may also
receive residual compensation and royalties following the divestment of assets last financial year.
Significant Changes in State of Affairs
There were no significant changes in the Company’s state of affairs not otherwise included in this report.
Matters Subsequent to the Reporting Date
PERFORMANCE RIGHTS AND SHARE RIGHTS
On 8 August 2022, a total of 1,600,253 Performance Rights were granted to KMP under the approved Performance Rights
Plan. Rights granted are subject to a vesting period over which the fair value of such rights will be expensed. On 26 July 2022,
a total of 2,393,229 vested Performance and Share Rights were converted to ordinary shares by a KMP.
CONTRACTOR CLAIMS
Subsequent to year end, the Company notified a contractor that the contractor’s site access would be delayed (due to a delay
in the approvals required to construct a lay down area, and road leading to the contractor’s site). The contractor has issued a
claim under the contract for an extension of time and delay costs. The claim is currently being assessed in accordance with the
terms of the contact. Any amounts expected to be payable to the contractor will be taken into account in the current cost and
design review.
Other than disclosed above, no matter or circumstance has arisen since the end of the financial year which significantly
affected or may significantly affect the operations of the Company, the results of those operations, or the state of affairs of
the Company in financial periods subsequent to the financial year ended 30 June 2022.
MANAGEMENT TRANSITION
In conjunction with the release of this report, the Company will announce the appointment of Kerryl Bradshaw as Interim
CEO, with Alwyn Vorster to conclude his employment with the company. The company is also progressing a search for a
permanent CEO.
BCI MINERALS ANNUAL REPORT 22 / 59
BCI MINERALS ANNUAL REPORT 22 / 59
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Audit Independence and Non-Audit Services
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is attached to
the independent auditor’s report and forms part of the Directors’ Report.
NON-AUDIT SERVICES
For the year ended 30 June 2022 the Board of Directors is satisfied that the auditor, BDO Audit (WA) Pty Ltd, did not provide
any non-audit services to the Company, as set out in Note 27 to the Financial Statements, that compromised the auditor
independence requirements of the Corporations Act 2001.
Signed in accordance with a resolution by the Directors.
BRIAN O’DONNELL
CHAIR
Perth, Western Australia
24 August 2022
ALWYN VORSTER
MANAGING DIRECTOR
Perth, Western Australia
24 August 2022
60 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Remuneration Report
The Remuneration Report outlines the remuneration arrangements in place for Directors and other Key Management
Personnel (“KMP”) of the Company in accordance with section 308 (3c) of the Corporations Act 2001.
For the purpose of this report the KMP are defined as those persons having authority and responsibility for planning, directing
and controlling the major activities of the Company, directly or indirectly, including any directors of the Company.
Non-Executive Directors
B O’Donnell
M Blakiston
M Stanborough
G Dixon
R Court
C Salisbury
J Bloom
Executive Directors and Executives
A Vorster
S Hodge (b)
K Bradshaw
S Bennett (a)
Non-executive Chair
Non-executive Director
Non-executive Director (Appointed 14 June 2022)
Non-executive Director
Non-executive Director
Non-executive Director
Non-executive Director (resigned 20 December 2021)
Managing Director
Chief Financial Officer (ceased 9 January 2022)
Chief Financial Officer (Appointed 10 January 2022)
Chief Development Officer (Appointed 28 February 2022)
(a) Prior to his appointment as Chief Development Officer, Mr Bennett was Project Director
(b) Mr Hodge was transferred to Head of Commercial position on 9 January 2022
Remuneration Governance
The roles and responsibilities of the Board, Remuneration & Nomination Committee (“RNC”), management and external
advisors in relation to remuneration for Executive KMP and employees at BCI Minerals are outlined in the table below.
The RNC is a committee of the Board comprised of three Non-Executive Directors, two of whom are independent.
The Company received 99.4% support for its Remuneration Report for the 2021 financial year.
BCI MINERALS ANNUAL REPORT 22 / 61
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CONTENTS
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DIRECTOR’S
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ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
The roles and responsibilities of our Board, Remuneration Committee, management and external advisors in relation to
remuneration for Executive KMP and employees at BCI Minerals are outlined below.
Remuneration Governance at BCI Minerals
• Approves the Company’s Remuneration
Framework and satisfies itself that the Company’s
remuneration policies are aligned with the
Company’s vision, values, strategic objectives and
risk appetite;
• Approves the remuneration arrangements
for the Non-Executive Directors, approves
the appointment and remuneration of the
Managing Director and Senior Executives on
recommendation from the RNC; and
• Approves the appointment of an External
Remuneration Consultant.
Established by the Board and operating under
its own Charter to develop, review and make
recommendations to the Board on matters such as:
• Remuneration strategy, framework and policies;
• Non-Executive Director, Managing Director and
Senior Executive remuneration arrangements;
•
Incentive plans including eligibility, performance
measures and outcomes for the Managing
Director and Senior Executives;
• Retirement and other employee benefits; and
• Remuneration Reporting and disclosures.
The Committee may take input from other Board
Committees, such as Audit and Risk Committees
in discharging its duties and no member is able
to deliberate or consider any aspect of their own
remuneration.
The RNC reviews executive remuneration annually,
including assessment of:
• The remuneration outcomes for Non-Executive
Directors and Executive KMP;
•
Individual and business performance
measurement against both internal targets and
appropriate external comparatives.
•
Implementation of BCI’s remuneration strategy,
policy and practices;
• Provide information and recommendations to
the RNC for consideration, including trends and
market insights;
• The Managing Director may make
recommendations to the RNC in relation to
the performance and reward of the Managing
Director’s direct reports.
Board of
Directors
Remuneration
& Nomination
Committee
(RNC)
MD &
Management
62 / BCI MINERALS ANNUAL REPORT 22
Remuneration
Consultants
Remuneration Consultants
were engaged through
management for the
purpose of providing
information on
remuneration-related
issues, including
benchmarking information
and market data.
If a Remuneration
recommendation is
made, it must be provided
directly to a Non-Executive
Director, and shall be
free of any management
influence and must
be disclosed in the
Remuneration Report.
No remuneration
recommendations
were received by the
Remuneration Committee
in relation to Executive
KMP in FY22.
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Components of Executive Remuneration
The Company’s Remuneration Framework relating to Executives, enables the Board to find the right balance between
remuneration outcomes that reward and incentivise our Executives, while also reflecting overall business performance
and the shareholder experience. Details are set out in the table below. The Company will administer vesting decisions in
relation to all relevant incentives for executives, including performance rights issued in 2021 and 2022, in accordance with
this methodology.
Fixed Remuneration
Fixed Remuneration is set with
reference to our competitor market
and reflects size of role and each
Executive’s responsibilities, skills and
experience.
Includes base salary and
superannuation.
Fringe benefits such as insurance,
parking and professional development
support may also be provided.
Why
Structure
We benchmark Fixed Remuneration
against appropriate competitor groups
that reflect the market in which we
operate.
Our approach
in FY22
Variable Pay (at risk)
Short-Term Incentive
Long-Term Incentive
Focusses effort on the key
priorities for the year and reflects
outcomes that are generally within
management’s control
Key Performance Indicators (KPIs)
are selected each year to focuses
efforts on our key priorities to ensure
success in the financial year and into
the future. These may be made up of
a combination of Financial, Project,
Strategic or other measures.
The maximum STI opportunity for
Executive KMP is between 50% and
80% of Fixed Remuneration.
The STI payment may, at the Board’s
discretion, be in cash and/or equity.
For FY22, half the STI outcome will
be paid in cash following the end of
the financial year with the other half
being provided in Share Rights with a
12-month service period for vesting
and subject to an additional 12-month
holding lock post-vesting.
Vested Share Rights must be
exercised within two years of vesting.
Aligned to the experience of our
shareholders over the longer-term
and designed to drive long-term
performance and ownership
behaviours.
The LTI opportunity for Executive KMP
is up to 70% of Fixed Remuneration
for the MD and up to 50% for other
Executives.
Performance hurdles are primarily
based on company share price and/
or other relevant Total Shareholder
Return (“TSR”) measures.
Performance is measured over a two-
year period with Vested Rights subject
to an additional 12-month holding lock
post-vesting.
The LTI is provided in Rights to BCI
Minerals Limited shares, with a
performance period from July 2021
to June 2023 with vesting from July
2024.
Performance conditions:
Absolute TSR (50% weighting):
Annual TSR
Vesting
< 10%
Zero
10% to 20%
>20%
Vesting from
0% to 100%
100% vesting
TSR relative to the ASX All Ords Index
materials class peer group (50%
weighting):
TSR Performance
Vesting
< 50th percentile
Zero
Between 50th and
75th percentile
Proportionate
vesting from
50% to 100%
>75th percentile
100% vesting
Vested Performance Rights must be
exercised within two years of vesting.
BCI MINERALS ANNUAL REPORT 22 / 63
CONTENTS
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INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Company Performance
The table below shows key financial measures of company performance over the past five years.
Continuing operations
Revenue
Net profit/(loss) after tax
Basic earnings/(loss) per share
Dividends paid per share
$million
$million
Cents
Cents
Share price (last trade day of financial year)
A$
2022
2021
2020
2019
2018
65.2
(15.5)
(1.7)
-
0.27
160.2
22.0
4.02
-
0.55
77.3
0.4
0.09
-
0.17
54.8
12.9
3.26
-
0.18
33.4
(16.9)
(4.29)
-
0.14
FY22 Remuneration – Fixed Remuneration
A review of remuneration of Executive KMP is undertaken each year to ensure that:
•
reward levels are fair and responsible in accordance with the Australian market;
• BCI offers competitive, performance-based rewards that attract, retain and motivate; and
•
incentives provide fair reward in line with company and individual performance to deliver on the current and long term
strategic objectives.
This review includes an analysis of market remuneration in comparison to a relevant peer and competitor group and
development of company specific pay scales, including for Executives.
Short-Term Incentives
Executives listed in this report may receive a short-term incentive (“STI”) of up to 50 - 70% of their annual fixed
remuneration. The STI is an “at risk” component of remuneration and payment may, at the Board’s discretion, be in cash and/
or equity. Measurement is based on performance against annually agreed key performance indicators (“KPIs”). These KPIs will
typically be aligned to achievement of specific project and corporate objectives in relation to each financial year.
The KPIs for FY22 were based on:
•
•
•
•
key project milestones for the Mardie Project including (but not limited to) funding, schedule and budget, offtake
agreements, development progress, approvals and safety, sustainability and community measures;
safety and wellbeing, including compliance with licence to operate;
financial measures and systems; and
Individual performance targets.
Based on performance in the 2022 financial year relative to these KPIs, the Board assessed outcomes and exercised its
discretion to award STI payments for Executive KMP. The STI outcomes ranged between 75% and 81% of maximum
opportunity with the Managing Director being awarded 79% of maximum opportunity or a total of $374,880.
64 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
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DIRECTOR’S
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ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Long-Term Incentives - Vested
Based on the two TSR performance metrics for the 2020 LTI, for the two-year performance period to 30 June 2022,
the Board assessed the vesting outcome to be 38% of the Performance Rights granted. The remainder of the rights have
been lapsed.
aTSR (50% Weighting)
BCI PR Issue Price (Sep-20 Entitlement Issue Price)
BCI 30-day VWAP @ 30 Jun-22
BCI TSR (2 years)
BCI CAGR (1 Jul-20 to 30 Jun-22)
Vesting % - Proportionate
rTSR (50% Weighting)
BCI Total Return
Peer Rank
BCI’s percentile ranking
Vesting % - Proportionate
Total Vesting (50% aTSR + 50% rTSR)
Value
0.240
0.316
31.8%
14.8%
48%
Value
31.8%
40th out of 93 companies
57%
28%
38%
Vested Rights are subject to a minimum 12 month holding lock from the vesting date in July 2022 and must be exercised
by July 2024.
Long-Term Incentives - Granted
2022 Performance Rights (“PR”) were granted according to the Remuneration Framework, using the 30-day VWAP as of 30
June 2022 at the commencement of the applicable grant year, which was 31.62 cents, and the Fixed Remuneration as was
applicable at the time.
Name
Fixed Remuneration
% of Fixed Remuneration
$ Value of Grant
A Vorster
K Bradshaw
S Bennett
$671,000
$462,000
$550,000
70%
50%
50%
$469,700
$231,000
$275,000
Number of Rights
Granted
1,485,452
730,550
869,703
These rights will be subject to performance hurdles, with half based on Absolute TSR and half on Relative TSR, tested over the
two-year performance period from 1 July 2022 to 30 June 2024. Any Rights that vest will be subject to a minimum 12 month
holding lock from the vesting date of 1 July 2025.
Non-Executive Director Remuneration
Fees and payments to Non-Executive Directors reflect the demands which are made on, and the responsibilities of, the
Directors and are reviewed annually by the Board. The Chair is not present at any discussions relating to determination of his
own remuneration.
Directors’ fees are determined within an aggregate directors’ fee pool limit, which is periodically recommended for approval
by shareholders. The maximum currently stands at $900,000 in aggregate and was approved by shareholders at the annual
general meeting on 19 November 2014. This amount is separate from any specific tasks the directors, or their related entities
may take on for the Company.
Non-Executive Directors’ remuneration is comprised of cash fees and superannuation. At the discretion of the Board, a portion
of the remuneration may be delivered in share-based remuneration.
BCI MINERALS ANNUAL REPORT 22 / 65
CONTENTS
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CEO LETTER
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REPORT
CONTENTS
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DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Remuneration of Directors and Key Management Personnel
for the Year Ended 30 June 2022
The remuneration table below sets out the remuneration information for the directors and executives, which includes the
managing director, who are considered to be KMP of the Company.
Short Term
Post
Employment
Share Based
Payments
Salary and
fees
Incentives (a)
Other
benefits (b)
Super-
annuation
Performance
& Share
Rights (c)
Termination
Payment
Directors
B O’Donnell
M Blakiston
M
Stanborough (e)
J Bloom (f)
G Dixon
R Court
C Salisbury
Executives
A Vorster
S Hodge (g)
$
151,820
83,243
4,229
36,818
88,350
81,000
85,500
530,960
591,787
182,140
K Bradshaw (h)
200,987
$
-
-
-
-
-
-
-
-
112,891
50,575
-
S Bennett (i)
468,801
56,830
1,443,715
220,296
TOTAL
1,974,675
220,296
$
-
-
-
-
-
-
-
-
$
$
3,463
8,334
423
3,682
8,835
8,100
8,550
41,387
14,585
8,334
-
-
8,787
5,306
5,601
42,613
19,194
7,499
1,650
5,064
33,407
33,407
27,500
329,052
14,896
20,085
27,500
85,760
-
173,519
89,981
588,331
131,368
630,944
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
$
169,868
99,911
4,652
40,500
105,972
94,406
99,651
614,960
1,080,424
340,870
222,722
731,714
2,375,730
2,990,690
Performance
Related (d)
%
9
8
-
-
8
6
6
7
41
40
-
24
32
27
(a) Short term incentives paid during the financial year relate to performance in the previous financial year. Please refer to section on short-term
incentive payments above.
(b) Other benefits include fuel, parking and insurances. Directors’ and Officers’ liability premiums have not been allocated to individual directors.
(c) Share-based payments represent the accounting expense incurred by the Company for the stated financial period, reflecting the terms of the
Performance Rights as valued using a Monte Carlo simulation and Share Rights valued using market pricing at time of issue.
(d) Percentage performance related is the sum of short-term incentives and share based payments divided by total remuneration, reflecting the
actual percentage of remuneration at risk for the year. Note that short-term incentives are reported in the year in which they are paid but relate
to performance in previous reporting periods.
(e) Appointed 14 June 2022.
(f) Ceased role 20 December 2021.
(g) Ceased role 9 January 2022 as transferred to Head of Commercial role.
(h) Appointed 10 January 2022.
(i) Appointed 28 February 2022, previously held the role of Project Director.
66 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
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AUDITOR’S
REPORT
Remuneration of Directors and Key Management Personnel
for the Year Ended 30 June 2021
The remuneration table below sets out the remuneration information for the directors and executives, which includes the
managing director, who are considered to be KMP of the Company.
Short Term
Post
Employment
Share Based
Payments
Salary and
fees
Incentives (a)
Other
benefits (b)
Super-
annuation
Performance
& Share
Rights (c)
Termination
Payment
Directors
B O’Donnell
M Blakiston
J Bloom
G Dixon
R Court (e)
C Salisbury (f)
Executives
A Vorster
S Hodge
$
141,750
73,973
73,973
80,456
23,288
6,554
399,994
$
-
-
-
-
-
-
-
499,300
134,018
313,836
65,028
A Chamberlain (g)
321,570
116,966
S Bennett (h)
285,725
-
1,420,431
316,012
TOTAL
1,820,425
316,012
$
-
-
-
-
-
-
-
16,399
12,443
9,343
5,214
43,399
43,399
$
-
7,027
7,027
7,643
2,212
623
$
8,631
4,932
4,932
5,206
-
-
24,532
23,701
25,000
25,000
22,917
14,583
284,818
110,453
81,309
29,226
133,366
685,471
-
334,748
87,500
505,806
133,366
2,506,514
112,032
529,507
133,366
2,954,741
Total
$
150,381
85,932
85,932
93,305
25,500
7,177
448,227
959,535
526,760
$
-
-
-
-
-
-
-
-
-
Performance
Related (d)
%
6
6
6
6
0
0
5
44
33
29
9
33
29
(a) Short term incentives paid during the financial year relate to performance in the previous financial year. Please refer to section on short-term
incentive payments above.
(b) Other benefits include fuel, parking and insurances. Directors’ and Officers’ liability premiums have not been allocated to individual directors.
(c) Share-based payments represent the accounting expense incurred by the Company for the stated financial period, reflecting the terms of the
Performance Rights as valued using a Monte Carlo simulation and Share Rights valued using market pricing at time of issue.
(d) Percentage performance related is the sum of short-term incentives and share based payments divided by total remuneration, reflecting the
actual percentage of remuneration at risk for the year. Note that short-term incentives are reported in the year in which they are paid but relate
to performance in previous reporting periods.
(e) Appointed 28 January 2021.
(f) Appointed 28 May 2021.
(g) Resigned 31 May 2021.
(h) Appointed 16 November 2020.
BCI MINERALS ANNUAL REPORT 22 / 67
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Performance Rights on Issue
The terms and conditions of Performance Rights granted to KMP affecting remuneration in the current or future reporting
periods are set out in the following table as at the end of the financial reporting period.
Grant date
Date to vest
Expiry date
Risk free
rate at
grant date
Value per
right at
grant date
Number
granted at
grant date
Value at
grant date
Number
vested
Number
lapsed
Directors
B O’Donnell
26/11/2020 30/06/2023 30/06/2025
0.07%
M Blakiston
26/11/2020 30/06/2023 30/06/2025
0.07%
J Bloom
26/11/2020 30/06/2023 30/06/2025
0.07%
G Dixon
26/11/2020 30/06/2023 30/06/2025
0.07%
C Salisbury
25/11/2021 02/07/2024 03/07/2026
0.68%
R Court
25/11/2021 02/07/2024 03/07/2026
0.68%
0.128
0.128
0.128
0.128
0.287
0.287
295,313
37,800
168,750
21,600
168,750
21,600
178,125
22,800
85,826
24,632
81,309
23,336
-
-
-
-
-
-
-
-
-
-
-
-
Executives
A Vorster
27/11/2019
30/11/2020 30/11/2022
0.68%
0.0186
2,500,000
46,500 1,275,000 (1,225,000)
A Vorster
27/11/2019
30/11/2022
30/11/2024
0.68%
0.0398 2,500,000
99,500
A Vorster
26/11/2020 30/06/2023 30/06/2025
0.07%
0.128
1,529,209
195,739
A Vorster
25/11/2021 02/07/2024 03/07/2026
0.68%
0.287
942,983
270,636
-
-
-
-
S Hodge (a)
27/11/2019
30/11/2020 30/11/2022
0.68%
0.0186
900,000
16,740
459,000
(441,000)
S Hodge (a)
27/11/2019
30/11/2022
30/11/2024
0.68%
0.0398
900,000
35,820
S Hodge (a)
26/11/2020 30/06/2023 30/06/2025
0.07%
S Hodge (a)
30/07/2021 03/07/2024 03/07/2025
0.03%
0.128
0.341
705,906
90,356
361,262
123,190
S Bennett
26/11/2020 30/06/2023 30/06/2025
0.07%
0.128 1,000,000 128,000
S Bennett
30/07/2021 02/07/2024 03/07/2026
0.03%
0.341
506,926
123,190
-
-
-
-
-
-
(a) S Hodge was the Chief Financial Officer and a KMP until his change of role on 9 January 2022.
Subsequent to the year end, a portion of the PR 2020 performance rights were cancelled when the vesting formula
was applied.
A Monte Carlo simulation is used to value all Performance Rights granted by the Company. The Monte Carlo valuation
simulates the Company’s share price and depending on the hurdle, arrives at a value based on the number of Performance
Rights that are likely to vest. The risk-free rate of the Performance Rights on the date granted is shown in the table above.
68 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
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ANNUAL
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AUDITOR’S
REPORT
Share Rights on Issue
The terms and conditions of Share Rights granted to KMP affecting remuneration in the current or future reporting periods are
set out in the following table as at the end of the financial reporting period.
Grant date
Test date
Vesting date
Final
conversion
date
Value per
right at
grant date
Number
granted at
grant date
Value at
grant date
Number
vested
Number
lapsed
Executives
A Vorster
26/11/2020 02/08/2021 04/08/2021 04/08/2023
0.2550
855,798
218,228
855,798
A Vorster
25/11/2021 01/07/2022 04/07/2022 04/07/2024
0.4988
262,431
130.887
-
S Hodge (a)
31/07/2020 02/08/2021 04/08/2021 04/08/2023
0.1903
412,051
78,423
422,051
S Hodge (a)
31/07/2021 01/07/2022 04/07/2022 04/07/2024
0.5368
117,569
63,105
S Bennett
30/07/2021 01/07/2022 04/07/2022 04/07/2024
0.5368
132,108
70,909
-
-
-
-
-
-
(a) S Hodge was the Chief Financial Officer and KMP until his change of role on 9th January 2022.
Equity Instrument Disclosures
The interests of Directors and Executives in Shares at the end of the financial year 2022 are as follows:
Balance at
1 July 2021
Acquired
during year
Performance
Rights converted
during year
Disposed
during the year
Other changes
Balance at
30 June 2022
Directors
B O’Donnell
M Blakiston
M Stanborough
G Dixon
R Court
C Salisbury
Executives
A Vorster
S Hodge
Total
1,014,483
-
-
-
750,000
-
5,305,645
462,000
7,532,128
141,771
-
5,896
-
69,768
-
69,768
-
287,203
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(130,000)
(130,000)
-
-
-
-
-
-
-
-
-
1,156,254
-
5,896
-
819,768
-
5,375,413
332,000
7,689,331
BCI MINERALS ANNUAL REPORT 22 / 69
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The interests of Directors and Executives in Performance Rights at the end of the financial year are as follows.
Balance at
1 July 2021
Granted as
compensation
Converted
to shares
Rights lapsed/
cancelled
Balance at
30 June 2022
Directors
B O’Donnell
M Blakiston
R Court
C Salisbury
G Dixon
Executives
A Vorster
S Hodge
K Bradshaw
S Bennett
Total
295,313
168,750
-
-
178,125
5,304,209
2,064,906
-
1,000,000
9,011,303
-
-
81,309(a)
85,826(a)
-
942,983(a)
361,262
-
506,926
1,978,306
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
295,313
168,750
81,309
85,826
178,125
6,247,192
2,426,168
-
1,506,926
10,989,609
Subsequent to the year end, a portion of the PR 2020 performance rights were cancelled when the vesting formula
was applied.
The interests of Executives in Share Rights at the end of the financial year are as follows.
Executives
A Vorster
S Hodge*
S Bennett
Total
Balance at
1 July 2021
Granted as
compensation
Converted
to shares
Rights lapsed/
cancelled
Balance at
30 June 2022
855,978
412,051
-
1,268,029
262,431(a)
117,569
132,108
512,108
-
-
-
-
-
-
-
-
1,118,229
529,620
132,108
1,779,957
* S Hodge was the Chief Financial Officer until 9 January 2022.
(a) Shareholder approval for the issue of these securities was obtained under ASX listing rule 10.14 on 25 November 2021.
Share Trading Policy
The trading of shares by all employees is subject to, and conditional upon, compliance with the Company’s share trading
policy which is available on the Company’s website: www.bciminerals.com.au. Directors and employees may not engage in
short-term or speculative trading of the Company’s securities and are prohibited from trading in financial products issued or
created over, or in respect of the Company’s securities during a non-trading period.
70 / BCI MINERALS ANNUAL REPORT 22
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Service Agreements
The remuneration and other terms of employment for executive KMP are covered in formal employment contracts. The key
terms of their employment contracts, at the date of release of this report, are shown in the table below.
Name
A Vorster (a)
(Managing Director)
Terms/Notice periods/Termination payment
Base salary inclusive of superannuation of $671,000 reviewed at intervals to be
determined by the Company.
Employment can be terminated at three months’ notice by Mr Vorster or by the
Company. If the Company elects to terminate the employment agreement for
reasons other than Mr Vorster’s gross misconduct or default, Mr Vorster will be entitled
to a payment equal to six months’ total fixed remuneration. Certain agreed trigger
events will lead to Mr Vorster having the option to terminate the contract and receive
a payment equal to twelve months’ total fixed remuneration.
K Bradshaw
(Chief Financial Officer)
Base salary inclusive of superannuation $480,344 reviewed at intervals to be
determined by the Company.
S Bennett
(Chief Development Officer,
previously Project Director)
Employment can be terminated at twelve weeks’ notice by Ms Bradshaw or by the
Company. Certain agreed trigger events will lead to Ms Bradshaw having the option
to terminate the contract and receive a payment equal to six months’ total fixed
remuneration.
Base salary inclusive of superannuation $571,838 reviewed at intervals to be
determined by the Company.
Employment can be terminated at three months’ notice by Mr Bennett or by the
Company. Certain agreed trigger events will lead to Mr Bennett having the option to
terminate the contract and receive a payment equal to six months’ fixed remuneration
(a) Mr Alwyn Vorster gave notice of resignation to the Company on 15 July 2022, with a transition period of up to 6 months post resignation.
Transactions With Key Management Personnel
On 1 March 2017, Michael Blakiston was appointed as a Non-Executive Director of the Company. Mr Blakiston is a partner in
the legal firm Gilbert + Tobin. During the current financial year, the Company made legal fee payments to Gilbert + Tobin of
$483K (2021: $720K). All transactions were on normal commercial terms and conditions.
Refer to Note 28 for further detail on Related Party transactions.
Other Information
INSURANCE OF OFFICERS
During the financial period, the Company paid a premium in respect of a contract to insure the Directors and executives of
the Company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits
disclosure of the nature of the liability and the amount of the premium.
No liability has arisen under this indemnity as at the date of this report.
The Company has entered into indemnity deeds with each director and officer. Under the deeds, the Company indemnifies
each director and officer to the maximum extent permitted by law against legal proceedings or claims made against or
incurred by the directors or officers in connection with being a director or officer of the Company, or breach by the
Company of its obligations under the deed.
BCI MINERALS ANNUAL REPORT 22 / 71
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Independent Audit of Remuneration Report
The Remuneration Report has been audited by BDO. Please see page 112 of this report for BDO’s report on
the Remuneration Report.
Signed in accordance with a resolution by the Directors.
BRIAN O’DONNELL
CHAIR
Perth, Western Australia
24 August 2022
ALWYN VORSTER
MANAGING DIRECTOR
Perth, Western Australia
24 August 2022
72 / BCI MINERALS ANNUAL REPORT 22
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Directors’ Declaration
In the opinion of the Directors of BCI Minerals Limited:
a. the financial statements comprising the consolidated statement of profit or loss and other comprehensive income,
consolidated statement of financial position, consolidated statement of cash flows, consolidated statement of changes in
equity and accompanying notes are in accordance with the Corporations Act 2001 including:
i. giving a true and fair view of the financial position of the Company as at 30 June 2022 and of its performance for the
financial year ended 30 June 2022 and
ii. complying with Accounting Standards and the Corporations Regulations 2001 and other mandatory professional
reporting requirements.
b. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and
c.
payable.
the Company has included in the notes to the financial statements an explicit and unreserved statement of compliance
with International Financial Reporting Standards.
The Directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer required by section
295A of the Corporations Act 2001 (Cth).
This declaration is made in accordance with a resolution of the Directors and is signed on their behalf by:
BRIAN O’DONNELL
CHAIR
Perth, Western Australia
24 August 2022
BCI MINERALS ANNUAL REPORT 22 / 73
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Annual
Financial Report
For the Year Ended 30 June 2022
74 / BCI MINERALS ANNUAL REPORT 22
74 / BCI MINERALS ANNUAL REPORT 22
05 CONTENTS
CHAIR’S LETTER
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Financial Statement Contents
Consolidated statement of profit or loss and other comprehensive income ....................................................................................................76
Consolidated statement of financial position .................................................................................................................................................................77
Consolidated statement of changes in equity................................................................................................................................................................ 78
Consolidated statement of cash flows .............................................................................................................................................................................. 79
Notes to the consolidated financial statements ........................................................................................................................................................... 80
Preface to the notes .............................................................................................................................................................................................. 80
Note 1 – Revenue ..................................................................................................................................................................................................... 82
Note 2 – Expenses .................................................................................................................................................................................................. 83
Note 3 – Impairment of non-financial assets .............................................................................................................................................. 83
Note 4 – Income taxes .......................................................................................................................................................................................... 85
Note 5 – Cash and cash equivalents ................................................................................................................................................................ 87
Note 6 – Trade and other receivables .............................................................................................................................................................88
Note 7 – Property, plant and equipment .......................................................................................................................................................88
Note 8 – Exploration and evaluation ................................................................................................................................................................ 91
Note 9 – Intangibles ............................................................................................................................................................................................... 92
Note 10 – Other Financial Assets ..................................................................................................................................................................... 92
Note 11 – Leases ....................................................................................................................................................................................................... 93
Note 12 – Trade and other payables ............................................................................................................................................................... 93
Note 13 – Provisions .............................................................................................................................................................................................. 94
Note 14 – Borrowings ............................................................................................................................................................................................. 95
Note 15 – Capital risk management ................................................................................................................................................................. 96
Note 16 – Contributed equity ............................................................................................................................................................................. 96
Note 17 – Reserves .................................................................................................................................................................................................. 97
Note 18 – Accumulated losses ........................................................................................................................................................................... 97
Note 19 – Earnings per share ..............................................................................................................................................................................98
Note 20 – Financial risk management ...........................................................................................................................................................98
Note 21 – Subsidiaries .........................................................................................................................................................................................100
Note 22 – Segment information ......................................................................................................................................................................101
Note 23 – Commitments ...................................................................................................................................................................................102
Note 24 – Contingent liabilities and assets .................................................................................................................................................102
Note 25 – Events occurring after the reporting period ..........................................................................................................................102
Note 26 – Parent entity .......................................................................................................................................................................................102
Note 27 – Auditor’s remuneration ...................................................................................................................................................................103
Note 28 – Related party transactions ...........................................................................................................................................................103
Note 29 – Share based payments ..................................................................................................................................................................104
Note 30 – Other accounting policies ............................................................................................................................................................ 107
BCI MINERALS ANNUAL REPORT 22 / 75
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Consolidated Statement of Profit or Loss
and Other Comprehensive Income
BCI Minerals Limited and its controlled entities for the year ended 30 June 2022
Revenue from continuing operations
Sale of goods
Other revenue
Total revenue from continuing operations
Cost of sales
Administration expenses
Project development and evaluation expenditure
Profit on sale of exploration tenements
Impairment on sale of exploration and intangible assets
(Loss) / profit before finance cost and income tax
Finance costs
(Loss) / profit before income tax
Income tax benefit / (expense)
(Loss) / Profit after income tax from continuing operations attributable to
owners of BCI Minerals Limited
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss
Net change in fair value of financial assets at fair value through other comprehensive income
Total items that will not be reclassified subsequently to profit or loss
Total comprehensive (loss) / income for the year
Statutory earnings per share (EPS)
Basic earnings / (loss) per share from continuing operations
Diluted earnings / (loss) per share from continuing operations
Notes
1
2
2
8
9
4
19
19
2022
$000’s
65,198
600
65,798
(39,661)
(20,952)
(20,616)
-
-
(15,431)
(54)
(15,485)
-
2021
$000’s
160,156
326
160,482
(93,630)
(8,120)
(34,487)
22
(2,255)
22,012
(40)
21,972
-
(15,485)
21,972
14,385
14,385
(1,100)
Cents
(1.70)
(1.69)
-
-
21,972
Cents
4.02
4.01
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes.
76 / BCI MINERALS ANNUAL REPORT 22
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Consolidated Statement of Financial Position
BCI Minerals Limited and its controlled entities for the year ended 30 June 2022
Current assets
Cash and cash equivalents
Short term investments
Trade and other receivables
Other financial assets
Total current assets
Non-current assets
Receivables
Property, plant and equipment
Exploration and evaluation assets
Intangibles
Right of use assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Lease liability
Provisions
Total current liabilities
Non-current liabilities
Trade and other payables
Lease liability
Loans and borrowings
Provisions
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Contributed equity
Reserves
Accumulated losses
Total shareholders' equity
Notes
5
6
10
6
7
8
9
11
12
11
13
12
11
14
13
16
17
18
2022
$000’s
232,021
657
21,484
38,666
2021
$000’s
79,435
681
56,435
-
292,828
136,551
32,705
194,920
1,754
15,502
684
245,565
538,393
15,816
49,384
9,728
15,502
827
91,257
227,808
56,983
37,548
501
1,274
395
791
58,758
38,734
8,048
276
19,718
17,357
45,399
104,157
-
478
-
15,932
16,410
55,144
434,236
172,664
569,345
27,045
313,190
6,143
(162,154)
(146,669)
434,236
172,664
The above consolidated statement of financial position should be read in conjunction with the accompanying notes
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Consolidated Statement of Changes in Equity
BCI Minerals Limited and its controlled entities for the year ended 30 June 2022
Contributed
equity
Accumulated
losses
$000’s
$000’s
267,303
(168,641)
Reserves
$000’s
5,455
Balance at 1 July 2020
Profit for the year
Total comprehensive income
Transactions with equity holders in their capacity as equity holders
Shares issued net of transaction costs
Performance Rights converted
Share based payments
Balance at 30 June 2021
Loss for the year
Other comprehensive income
Total comprehensive income
Transactions with equity holders in their capacity as equity holders
Shares issued net of transaction costs
Performance Rights converted
Share based payments
Financial instruments recognised in equity
-
-
21,972
21,972
45,872
15
-
-
-
-
313,190
(146,669)
-
-
-
(15,485)
-
(15,485)
255,958
197
-
-
-
-
-
-
Total
$000’s
104,117
21,972
21,972
45,872
-
703
172,664
(15,485)
14,385
(1,100)
255,958
-
932
5,782
434,236
-
-
-
(15)
703
6,143
-
14,385
14,385
-
(197)
932
5,782
27,045
Balance at 30 June 2022
569,345
(162,154)
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
78 / BCI MINERALS ANNUAL REPORT 22
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Consolidated Statement of Cash Flows
BCI Minerals Limited and its controlled entities for the year ended 30 June 2022
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Borrowing costs
Income tax refund
Net cash flows provided by operating activities
Cash flows from investing activities
Proceeds from disposal of exploration tenements
Proceeds from disposal of plant and equipment
Payments for short term investments
Payments for plant and equipment, IT and development
Payments for exploration and evaluation assets
Net cash flows used in investing activities
Cash flows from financing activities
Proceeds from issue of shares net of costs
Repayment of lease liabilities
Net cash flows from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Notes
5
7
5
2022
$000’s
102,940
(62,046)
600
(1,886)
0
39,608
0
36
-
(142,715)
-
2021
$000’s
120,822
(111,870)
320
(46)
0
9,226
0
301
(166)
(14,185)
(2,834)
(142,679)
(16,884)
256,155
(498)
255,657
152,586
79,435
232,021
45,872
(327)
45,545
37,887
41,548
79,435
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
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Notes to the Consolidated Financial Statements
BCI Minerals Limited and its controlled entities for the year ended 30 June 2022
Preface to the Notes
The notes include information which is required to
understand the financial statements and is material and
relevant to the operations and the financial position and
performance of the Company. Information is considered
relevant and material if:
• The amount is significant due to its size or nature;
• The amount is important in understanding the results
of the Company;
•
•
It helps to explain the impact of significant changes in
the Company’s business; or
It relates to an aspect of the Company’s operations that
is important to its future performance.
The notes are organised into the following sections:
• Basis of preparation;
• Key numbers;
• Capital;
• Risk management;
• Group structure;
• Unrecognised items; and
• Other notes.
Basis of Preparation
CORPORATE INFORMATION
The financial statements for BCI Minerals Limited for the
year ended 30 June 2022 were authorised for issue in
accordance with a resolution of the Directors on
24 August 2022. BCI Minerals Limited is a company limited
by shares incorporated in Australia whose shares are
publicly traded on the Australian Securities Exchange. BCI
Minerals Limited and its subsidiaries together are referred
to in these financial statements as the ‘Company’ or the
‘Consolidated Entity’.
The principal activities of the Company during the financial
year were the development of assets in the Pilbara region
of Western Australia, including the Mardie Salt & Potash
Project. The Company also receives revenue from the Iron
Valley Iron Ore Mine under the terms of an Iron Ore Sale
and Purchase Agreement.
BASIS OF PREPARATION
The principal accounting policies adopted in the
preparation of the financial statements are set out in
the notes to the accounts. These policies have been
consistently applied to all the financial years presented,
unless otherwise stated.
These general purpose financial statements have been
prepared in accordance with Australian Accounting
Standards and Interpretations issued by the Australian
Accounting Standards Board (“AASB”), and the
Corporations Act 2001. BCI Minerals Limited is a for-
profit entity for the purpose of preparing the financial
statements.
The financial statements are presented in Australian
dollars. The Company is of the kind referred to in ASIC
Corporations (Rounding in Financials/Directors’ Reports)
Instrument 2016/191, and in accordance with that
Corporations Instrument amounts in the directors’ report
and annual financial report are rounded off to the nearest
thousand dollars, unless otherwise indicated.
COMPLIANCE WITH IFRS
The consolidated financial statements of BCI Minerals
Limited comply with International Financial Reporting
Standards (“IFRS”) as issued by the International
Accounting Standards Board.
80 / BCI MINERALS ANNUAL REPORT 22
80 / BCI MINERALS ANNUAL REPORT 22
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HISTORICAL COST CONVENTION
COMPARATIVES
Where applicable, comparatives have been adjusted to
conform with current year presentation.
KEY ESTIMATES AND JUDGEMENTS
In the process of applying the Company’s accounting
policies, management has made a number of judgements
and applied estimates of future events. Judgements and
estimates which are material to the financial report are
found in the following notes:
Note 3:
Impairment of non-financial assets
Note 4:
Income taxes
Note 7: Property, plant and equipment
Note 8: Exploration and evaluation
Note 9:
Intangibles
Note 13: Provisions
Note 14: Borrowings
Note 29: Share based payments
The financial statements have been prepared under the
historical cost convention, except for, where applicable, the
revaluation of financial assets and cash flow hedges at fair
value through other comprehensive income.
NEW, REVISED OR AMENDING ACCOUNTING
STANDARDS AND INTERPRETATIONS ADOPTED
New and amended standards adopted by the group
There are no new or amended standards adopted by the
group during the reporting period.
IMPACT OF STANDARDS ISSUED BUT NOT YET
APPLIED BY THE ENTITY
There are no new standards yet to be applied by the Group.
CHANGES IN ACCOUNTING POLICY, ESTIMATES
DISCLOSURES, STANDARDS AND INTERPRETATIONS
Except for matters relating to the adoption of new
Australian Accounting Standards referred to above, the
accounting policies adopted and estimates made are
consistent with those of the previous financial year.
FOREIGN CURRENCY
The financial statements are presented in Australian
dollars which is the Company’s functional and
presentation currency.
Foreign currency transactions are translated into Australian
dollars using the exchange rates prevailing at the dates
of the transactions. Foreign exchange gains and losses
resulting from the settlement of such transactions, and
from the translation at financial year-end exchange rates
of monetary assets and liabilities denominated in foreign
currencies are recognised in profit or loss.
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Key Numbers
NOTE 1 – REVENUE
Sales – Iron Valley
Net gain / (loss) on pricing changes
Rebate – Iron Valley
Sale of Goods
Interest revenue
Other income
Total
2022
$000’s
62,998
2,200
-
65,198
600
-
65,798
2021
$000’s
184,659
(2,300)
(22,203)
160,156
320
6
160,482
Accounting policy
Revenue is recognised if it meets the criteria outlined below.
Sales – Iron Valley
Revenue from contracts with customers for the sale of goods is recognised when persuasive evidence, usually in the form
of an executed sales agreement, or an arrangement exists, indicating there has been a transfer of control to the customer,
no further work or processing is required by the Company, the quantity and quality of the goods has been determined with
reasonable accuracy, the price can be reasonably estimated, and collectability is reasonably assured.
The Company receives revenue from Mineral Resources Limited (“MIN”) based on a mine gate sale agreement based on MIN’s
realised price. The Company recognises revenue when the ore passes over the ships rail which is typically at the bill of lading.
MIN send monthly shipping information on either a provisional basis at the date of shipment or the subsequent final pricing,
which is typically once the vessel has arrived at its destination and quotation pricing has been determined. BCI recognises
revenue on provisionally priced sales based on the estimated fair value of the total consideration, adjusted for any changes
when pricing is finalised. Provisionally priced sales for which price finalisation is referenced to the relevant metal price index
have an embedded commodity derivative. The embedded derivative is carried at fair value through profit or loss as part of
trade receivables. The period between provisional pricing and final invoices is typically 30 to 90 days. In the prior year, the
Company provided rebates from an agreement with MIN to rebate 40% of net royalties to MIN, up to a total value of $25M.
This value has been reached and the rebate no longer applies.
Interest revenue
Interest revenue is recognised on a time proportionate basis using the effective interest method.
82 / BCI MINERALS ANNUAL REPORT 22
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NOTE 2 – EXPENSES
Amortisation of mine properties
Royalties
Cost of sales
Employee benefits expense
Depreciation and amortisation
Share based payments
Non-executive directors' fees
Occupancy related expenses
Consultant and legal fees
Other
Administration expenses
2022
$000’s
2,278
37,383
39,661
12,120
3,396
932
679
141
1,342
2,342
20,952
2021
$000’s
3,006
90,624
93,630
2,593
1,967
703
510
237
993
1,117
8,120
NOTE 3 – IMPAIRMENT OF NON-FINANCIAL ASSETS
Accounting policy
Assets are reviewed for impairment at each reporting date or whenever events or changes in circumstances indicate that
the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which an asset’s carrying
amount exceeds its recoverable amount.
The valuation used by BCI to determine recoverable amount is the higher of an asset’s fair value less costs of disposal
(“FVLCD”) and value in use (“VIU”).
Accounting standards require that the valuation technique used be consistent with one of three commonly accepted
approaches outlined below:
•
•
•
Level 1 Market - The market approach uses prices and other relevant information generated by market transactions
involving identical or comparable (i.e. similar) assets, liabilities or a group of assets and liabilities, such as a business.
Examples relevant to BCI include earnings multiples or JORC reserve/resource multiples;
Level 2 Cost - The cost approach reflects the amount that would be required currently to replace the service capacity of an
asset (often referred to as current replacement cost); and
Level 3 Income - The income approach converts future amounts (e.g. cash flows or income and expenses) to a single
current (i.e. discounted) amount. When the income approach is used, the fair value measurement reflects current market
expectations about those future amounts. Examples include Net Present Value (“NPV”) techniques.
FVLCD is an NPV calculation which is consistent with the Level 3 income approach.
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable
cash flows which are largely independent of the cash flows from other assets or groups of assets (cash-generating units).
An impairment loss is recognised for the amount by which an asset’s carrying amount exceeds its recoverable amount.
Non-financial assets other than goodwill that have been impaired are reviewed for possible reversal of impairment at each
reporting period.
Assets subject to impairment indicator assessment
The following assets have been assessed for indicators of impairment
• Mine properties (Iron Valley Iron Ore Royalty Rights);
•
Intangible assets (Koodaideri South Royalty and North Marillana Iron Ore Royalty);
• Project Development Assets (Mardie Salt & SOP); and
• Other Exploration asset (Carnegie JV).
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Impairment assessment
The Company has completed its annual review of its assets for impairment. Based on these assessments, the Company has
concluded that impairment of assets was not required. In the prior year, impairment was recognised on assets sold, refer to
note 8 and 9 for further detail.
Revenue assumptions
Cash flow projections used to estimate recoverable amounts include assumptions on revenue. The assumptions used for
revenue in impairment testing are summarised below:
CFR 62% Fe iron ore price (USD/dmt, nominal)
Years 1-5
Years 6-10
Years 11-20
Foreign exchange rate (AUD:USD, nominal)
Years 1-5
Years 6-10
Years 11-20
Inflation (% per annum)
AUD 5-yr inflation rate
2022
2021
84-99
93-103
106-133
106-161
112-121
123-145
0.76-0.80
0.77-0.78
0.80
0.80
2.5
0.78
0.78
1.9
Key estimates and judgements
The recoverable amount of mine property, plant and equipment and intangible assets is estimated on the basis of the
discounted value of future cash flows. The estimates of future cash flows are based on significant assumptions including:
•
•
estimates of the quantities of ore reserves and mineral resources for which there is a high degree of confidence of
economic extraction and the timing of access to these reserves and resources;
future iron ore prices and exchange rates based on forecasts by a range of recognised economic forecasters as well as
recent spot prices and rates;
• production rates, production costs and capital expenditure based on approved budgets and projections including inflation
factors;
•
•
the timing of when production will commence from projects for which royalties are payable to the Company; and
the asset specific discount rate applicable to the cash generating unit.
84 / BCI MINERALS ANNUAL REPORT 22
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NOTE 4 – INCOME TAXES
Current tax expense/(benefit)
Current period
Adjustments for prior periods
Deferred tax expense/(benefit)
Origination and reversal of temporary differences
Equity deferred tax movement
De-recognition of deferred tax assets
Utilisation of carried forward tax losses now recognised
Recognition of deferred tax asset on losses and temporary adjustments now realised
Adjustments for prior periods
Income tax (expense)/benefit reported in the Consolidated statement of
profit or loss and other comprehensive income
Reconciliation of effective tax rate
Profit / (loss) before tax
Income tax / (benefit) at the statutory rate of 30 per cent (2021: 30 per cent)
Non-deductible expenses
Other temporary differences derecognised
Equity deferred tax movement
Recognition of carried forward tax losses previously unrecognised
Utilisation of carried forward tax losses now recognised
Temporary differences (recognised)/derecognised
Under/(over) provided in prior periods and other
Income tax (expense)/benefit reported in the Consolidated statement of
profit or loss and other comprehensive income
2022
$000’s
-
-
-
1,606
(1,410)
-
(5,877)
5,681
-
-
-
(15,485)
(4,645)
499
(125)
(1,410)
-
-
5,681
-
-
2021
$000’s
-
-
-
(1,387)
(396)
-
8,171
(6,388)
-
-
-
21,972
6,591
213
(20)
(396)
8,171
(8,171)
(6,388)
-
-
Accounting policy
The income tax expense on income for the financial year is the tax payable on the current financial period’s taxable income
based on the national income tax rate, adjusted by changes in deferred tax assets and liabilities attributable to temporary
differences and to unused tax losses.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements.
Deferred income tax is determined using tax rates and laws that have been enacted or substantially enacted by the statement
of financial position date and are expected to apply when the related deferred income tax asset is realised or the deferred
income tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future
taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities
and when the deferred tax balances relate to the same taxation authority. Current tax assets and liabilities are offset where the
entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the
liability simultaneously.
Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.
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Significant judgement
The Company is subject to income taxes in Australia. Significant judgement is required in determining the provisions for
income taxes. There are certain transactions and calculations undertaken during the ordinary course of business for which
the ultimate tax determination may be subject to change. The Company estimates its tax liabilities based on the Company’s
understanding of the tax law. Where the final tax outcome of these matters is different from the amounts that were initially
recorded, such differences will impact the current and deferred income tax assets and liabilities in the period in which such
determination is made.
The Company recognises deferred tax assets relating to carried forward tax losses to the extent they can be utilised. The
utilisation of the tax losses depends on the ability of the entities to generate sufficient future taxable profits. At 30 June 2022,
the Company had unrecognised deferred tax assets relating to tax losses of $60.4M (2021: $67.2M). The Company has utilised
all available R&D off-sets (2021: $Nil).
Deferred tax assets not recognised
Temporary differences
Income Tax losses
Capital losses
Deferred tax assets and liabilities
Amounts recognised in Profit or Loss:
Mine property, plant and development
Provisions
Intangibles
Exploration
Other items
Amounts recognised directly in equity:
Share issue costs in equity
Temporary differences derecognised
Tax assets/(liabilities)
Movements in deferred tax assets
2022
$000’s
(2,636)
60,443
-
2021
$000’s
(2,439)
67,215
-
Assets
Liabilities
Net
2022
2021
2022
2021
2022
2021
$000’s
$000’s
$000’s
$000’s
$000’s
$000’s
(4,699)
(3,960)
(4,699)
(3,960)
-
423
-
-
-
962
-
-
1,016
1,064
1,884
3,323
-
3,323
475
2,501
-
2,501
-
-
(743)
(517)
-
(5,959)
2,636
(3,323)
-
-
(487)
(493)
-
(4,940)
2,439
(2,501)
Other
$000’s
802
262
-
1,064
(47)
-
1,017
423
-
(743)
499
1,884
(2,636)
2,636
-
Temporary
differences
derecognised
962
-
(487)
571
475
(2,439)
2,439
-
Total
$000’s
$000’s
-
-
-
-
-
-
-
1,138
1,363
2,501
822
3,323
Share issue
Provisions
costs Mine property
$000’s
$000’s
$000’s
At 1 July 2020
(Charged)/credited
to profit or loss
to (under)/over prior period
At 30 June 2021
(Charged)/credited
to profit or loss
to (under)/over prior period
177
785
962
159
316
475
(540)
1,409
At 30 June 2022
422
1,884
86 / BCI MINERALS ANNUAL REPORT 22
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-
-
-
-
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Movements in deferred tax liabilities
At 1 July 2020
(Charged)/credited
to profit or loss
to (under)/over prior period
At 30 June 2021
(Charged)/credited
to profit or loss
to (under)/over prior period
At 30 June 2022
Intangibles Mine property
Exploration
$000’s
(900)
900
-
-
-
-
-
$000’s
(3,535)
(425)
-
(3,960)
(739)
-
(4,699)
$000’s
(282)
(205)
-
(487)
(256)
-
(743)
Temporary
differences
derecognised
$000’s
4,063
Other
$000’s
(484)
Total
$000’s
(1,138)
(9)
-
(1,624)
(1,363)
-
-
(493)
2,439
(2,501)
(24)
-
(517)
197
-
(822)
-
2,636
(3,323)
NOTE 5 – CASH AND CASH EQUIVALENTS
Cash at bank and short term deposits
Cash on deposit
Total
Reconciliation of (loss) / profit after income tax to net cash flows from operating
activities
Net (loss) / profit
Depreciation and amortisation
Impairment on sale of exploration and intangible assets
Share based payments
Gain on disposal of exploration tenements
Other
(Increase)/decrease in assets
Trade and other receivables
Increase/(decrease) in liabilities
Trade and other payables
Provisions
Capitalised interest and borrowing costs
Net cash inflow / (outflow) from operating activities
2022
$000’s
210,021
22,000
232,021
(15,485)
5,674
-
951
-
(268)
2021
$000’s
27,221
52,214
79,435
21,972
4,973
2,255
703
(22)
40
17,756
(43,802)
28,743
3,977
(1,740)
39,608
22,630
478
-
9,227
Cash on deposit relates to 31 to 90 day term deposits held with financial institutions. See Note 20 – Financial risk
management note for further details.
Accounting policy
For consolidated statement of cash flows presentation purposes, cash and cash equivalents includes cash on hand, deposits
held at call with financial institutions, and other short-term, highly liquid investments with original maturities of three months
or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
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NOTE 6 – TRADE AND OTHER RECEIVABLES
Current
Trade receivables
Prepayments
Total current
Non-current
Other receivables
Prepayments
Total non-current
Total trade and other receivables
2022
$000’s
18,893
2,591
21,484
17,321
15,384
32,705
54,189
2021
$000’s
55,856
579
56,435
15,816
-
15,816
72,251
Due to the short-term nature of current receivables, their carrying amount is approximate to their fair value.
As at 30 June 2022 no receivables were past due or impaired (2021: Nil).
Other non-current receivables represent an estimate of the amount payable by the operator of the Iron Valley operation for
fulfilment of rehabilitation obligations at the end of operations.
Refer to Note 20 for information on the financial risk management policy of the Company.
Prepayments represent insurances and advance payments for contracts and facilities.
Accounting policy
Trade receivables are amounts due from customers for commodities sold in the ordinary course of business.
Trade Receivables that are Provisionally Priced
Trade receivables that contain an embedded derivative relating to the provisional pricing of iron ore are measured at fair
value. At each reporting date the provisional priced receivable is marked to market based on the forward selling price for the
quotation period stipulated in the contract until the quotation period expires and the change in value is recognised in the
profit or loss.
Other Trade Receivables
Trade receivables that do not contain an embedded derivative are measured at the amount of consideration that is
unconditional. The Group holds trade receivables with the objective to collect the contractual cash flows and measures them
at amortised cost.
The Group applies the simplified impairment methodology permitted by AASB 9, which requires expected lifetime losses to
be recognised from initial recognition of the receivables.
88 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
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REPORT
CONTENTS
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FINANCIAL REPORT
AUDITOR’S
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NOTE 7 – PROPERTY, PLANT AND EQUIPMENT
Mine Properties
Plant and
equipment
Office furniture,
equipment
and IT
Development
$000’s
$000’s
$000’s
$000’s
37,010
-
-
-
(3,006)
34,004
51,658
(17,654)
34,004
2,526
255
(4)
-
(1,464)
1,313
4,093
(2,780)
1,313
312
937
-
(157)
(175)
917
2,821
(1,904)
917
-
12,993
-
157
13,150
13,150
-
13,150
Mine Properties
Plant and
equipment
Office furniture,
equipment
and IT
Development
$000’s
$000’s
$000’s
$000’s
34,004
-
-
-
(2,278)
31,726
51,658
(19,932)
31,726
1,313
18,496
(107)
-
(2,438)
17,264
21,733
(4,469)
17,264
917
437
-
-
(461)
893
3,258
(2,365)
893
13,150
123,859
-
8,028
145,037
194,920
145,037
-
145,037
221,686
(26,766)
194,920
Total
$000’s
39,848
14,185
(4)
-
(4,645)
49,384
71,722
(22,338)
49,384
Total
$000’s
49,384
142,792
(107)
8,028
(5,177)
Year ended 30 June 2021
Opening net book value
Additions
Disposals
Reclassification of assets
Depreciation and amortisation expense
Closing net book value
At 30 June 2021
Cost
Accumulated depreciation and amortisation
Net carrying amount
Year ended 30 June 2022
Opening net book value
Additions
Disposals
Reclassification of assets
Depreciation and amortisation expense
Closing net book value
At 30 June 2022
Cost
Accumulated depreciation and amortisation
Net carrying amount
Accounting policy
Mine Properties
Once a mining project has been established as commercially viable and technically feasible, expenditure other than that
on land, buildings, plant and equipment is transferred and capitalised as mine property. Mine property costs include past
capitalised exploration and evaluation costs, pre-production development costs, development excavation, development
studies and other subsurface and permanent installation expenditure pertaining to that area of interest.
Mine property costs are accumulated in respect of each separate area of interest. Costs associated with commissioning new
assets in the period before they are capable of operating in the manner intended by management, are capitalised. Mine
property costs incurred after the commencement of production are capitalised to the extent they are expected to give rise to
a future economic benefit.
When an area of interest is abandoned, or the Directors decide that it is not commercial or technically feasible, any
accumulated cost in respect of that area is written off in the financial period the decision is made. Each area of interest is
reviewed at the end of each accounting period and accumulated costs written off to the profit or loss to the extent that they
will not be recoverable in the future.
Amortisation of mine property costs is charged on a unit of production basis over the life of economically recoverable reserves
once production commences.
BCI MINERALS ANNUAL REPORT 22 / 89
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Mine property assets are assessed for impairment if facts and circumstances suggest that the carrying amount exceeds the
recoverable amount. For the purposes of impairment testing, mine property is allocated to cash-generating units to which the
development activity relates. The cash generating unit shall not be larger than the area of interest.
Plant and equipment
Plant and equipment, including mechanical, electrical, field and computer equipment as well as furniture, fixtures and fittings,
is stated at historical cost less accumulated depreciation. Historical cost includes expenditure that is directly attributable to the
acquisition of the items. Depreciation is calculated on a straight-line basis so as to write off the net cost of each asset
over either its expected useful life of 2.5 to 5 years for furniture, computers and equipment, or the life of the mine for
plant and equipment.
Spare parts, stand-by equipment and servicing equipment is classified as property, plant and equipment if they are expected
to be used during more than one period, otherwise they are classified as inventory.
Assets acquired as part of the early construction at the Mardie project site will be depreciated on a straight-line basis over
2 to 3 years depending on the useful life of the assets.
Development
Development represents expenditure necessarily incurred during establishment and construction of a mining project that is
in progress but yet to be complete. This expenditure includes the cost associated with studies and evaluation through to early
construction cost of assets or infrastructure yet to be fully formed or ready for use. As tangible assets in the form of buildings
or plant and equipment are completed, they will be transferred to the relevant classification and depreciated over their
useful life. Other expenditure on project development that is not capitalised as plant or equipment will be capitalised as mine
properties and amortised on a units of production basis over the expected life of the project.
Key judgement – ore reserves and mineral resources
Amortisation of mine property assets is based on the depletion of economically recoverable reserves. The rate of amortisation
is re-assessed on a prospective basis when ore reserves are changed for the appropriate ore body in accordance with the JORC
2012 Guidelines.
90 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
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NOTE 8 – EXPLORATION AND EVALUATION
Opening balance
Carrying value of tenements sold
Reclassification to Mine Development
Exploration tenements acquisition
Unsuccessful exploration expenditure derecognised
Net carrying amount
2022
$000’s
9,728
-
(8,028)
-
54
1,754
2021
$000’s
6,425
(275)
-
3,578
-
9,728
Accounting policy
The Company accounts for exploration and evaluation activities as follows:
Acquisition and Exploration earn-in
Exploration and evaluation costs arising from acquisitions and earn-ins are carried forward where exploration and evaluation
activities have not, at reporting date, reached a stage to allow a reasonable assessment of economically recoverable reserves
otherwise they are written down to their recoverable amount.
As announced during the prior year, the Group has secured rights to additional tenement areas adjacent to the Mardie Salt
and Potash project tenement parcel. During the prior year, the Group exercised its option to acquire the remaining northern
tenement area for a cash cost of $2.5M plus duties and taxes. In addition, during the financial year the Group secured rights
to a third tenement area adjacent to the Mardie project and acquired the additional tenement area via an asset transfer
agreement with a value of $0.74M recognised for the exploration asset received. The additional tenement areas acquired
during the year provide optionality for future layout optimisation and expansion of the Mardie project.
Exploration and evaluation costs
Costs arising from on-going exploration and evaluation activities are expensed as incurred.
Disposal of tenements
During the prior financial year, the Group disposed of iron ore tenements with a carrying value of $0.27M under normal terms
and conditions.
Key judgement – Capitalisation of exploration and evaluation expenditure
The Company has capitalised acquired exploration and evaluation expenditure and earn-in expenditure on the basis that
either it is expected to be recouped through future successful development (or alternatively sale) of the areas of interest
concerned or on the basis that it is not yet possible to assess whether it will be recouped. The future recoverability of
capitalised exploration and evaluation expenditure is dependent on a number of factors, including whether the Company
decides to exploit the related lease itself, or, if not, whether it successfully recovers the related exploration and evaluation
asset through sale.
Factors that could impact the future recoverability include the level of reserves and resources, future technological changes,
costs of drilling and production, production rates, future legal changes (including changes to environmental rehabilitation
obligations) and changes to commodity prices.
BCI currently holds a 30% interest in the Carnegie Potash in a joint venture with ASX-listed potash development company,
Kalium Lakes Limited (“KLL”), who is the joint venture manager. BCI has rights to earn up to a 50% interest through sole
funding the Pre-Feasibility Study and Feasibility Study phases.
BCI MINERALS ANNUAL REPORT 22 / 91
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REPORT
NOTE 9 – INTANGIBLES
Net carrying value of intangibles:
Royalties
Net carrying amount
2022
$000’s
15,502
15,502
2021
$000’s
15,502
15,502
The intangible assets were acquired through Iron Ore Holdings Limited as follows:
Royalties
The Company holds royalties over the Koodaideri South and North Marillana Extension tenements. The assets have a finite life
reflecting the underlying resource and will be amortised as the resource is depleted. Production has not commenced at either
Koodaideri South or North Marillana and hence the assets remain unamortised.
The Koodaideri South royalty asset has been tested for impairment with the recoverable amount assessed by reference to
the FVLCD, in line the policy in note 3 and classified as level 3 under the fair value hierarchy. FVLCD was determined using an
income approach based on the net present value of future cash flows projected over the estimated mine life of 32 years. The
post-tax nominal discount rate used in determining FVLCD was 8.8%. Forecast iron ore price, foreign exchange and inflation
assumptions used in the calculation of FVLCD are summarised in Note 3.
The North Marillana Extension royalty asset has been tested for impairment with the recoverable amount assessed by
reference to the FVLCD, in line with the policy in note 3 and classified as level 3 under the fair value hierarchy. FVLCD was
determined using an income approach based on the net present value of future cash flows projected over the estimated mine
life of 10 years. The post-tax nominal discount rate used in determining FVLCD was 8.8%. Forecast iron ore price, foreign
exchange and inflation assumptions used in the calculation of FVLCD are summarised in Note 3.
The recoverable amounts were determined to be in excess of carrying values, and there are no probable changes to key
assumptions that would cause the asset to be impaired. Refer to Note 3 for details of the key estimates and judgements
applied in determining the recoverable amount.
NOTE 10 – OTHER FINANCIAL ASSETS
Financial assets at fair value through other comprehensive income
Shares in listed Company A (a)
Shares in listed Company B (a)
Total other financial assets
2022
$000’s
23,715
14,951
38,666
2021
$000’s
-
-
(a) On initial recognition election was made to recognise changes in fair value through Other Comprehensive Income
Investments in the equity of other listed entities are recognised on trade date and initially measured at fair value, net
of transaction costs. Subsequent changes in the fair value of the equity investments will be recognised through other
comprehensive income. The fair value of investments that are actively traded in an organised financial market is determined
by reference to quoted market price on reporting date. Recognition of the financial asset in this manner is considered a Level 1
measurement of fair value.
Financial assets that are expected to be held for a period greater than 12 months are classified as a non-current asset.
Movement in other financial assets
Fair value at acquisition
Gain / (Loss) on fair value of asset through other comprehensive income (Refer Note 17)
Closing balance
2022
$000’s
29,093
9,573
38,666
2021
$000’s
-
-
-
92 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
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CONTENTS
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CEO LETTER
SUSTAINABILITY
DIRECTOR’S
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ANNUAL
FINANCIAL REPORT
AUDITOR’S
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NOTE 11 – LEASES
Lease liabilities have been measured at amounts equal to the net present value of remaining lease payments over the
remaining term of the lease, discounted at the Group’s incremental borrowing rate. The weighted average interest rate applied
was 4.7%. The discount rate used in calculating the carrying amount of lease liabilities considers the circumstances applicable
over the underlying leased assets, in particular the lease value, the term and economic environment.
Right of use assets were measured at amounts equal to the carrying value of their respective lease liabilities on the adoption
date, adjusted for incentives, accruals and prepayments relating to the contractual agreement. Right of use assets are
depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis. There are no onerous lease
contracts that would require adjustment to the right of use assets on the adoption date.
Lease liabilities
June 2022
$000’s
June 2021
$000’s
Lease liability at 30 June
Additional lease contracts entered into during the period
Add: Borrowing costs
Less: Payments
Lease liabilities as at 30 June
Disclosure in Consolidated Statement of Financial Position
Current lease liability
Non-current lease liability
Total Lease liability
Right of use assets
Right of use assets at 30 June
Additional right of use assets recognised
Accumulated amortisation
Right of use assets as at 30 June
NOTE 12 – TRADE AND OTHER PAYABLES
Current
Trade payables and accruals
Total
Non-Current
Trade payables
Total
873
354
45
(495)
777
501
276
777
June 2022
$000’s
827
354
(497)
684
2022
$000’s
56,983
56,983
8,048
8,048
772
408
40
(347)
873
395
478
873
June 2021
$000’s
745
409
(327)
827
2021
$000’s
37,548
37,548
-
-
Accounting policy
These amounts represent liabilities for goods and services provided to the Company and royalty obligations, prior to the end
of the financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition.
The Company has financial risk management policies in place to ensure that all payables are paid within the credit timeframe
(refer to Note 20).
BCI MINERALS ANNUAL REPORT 22 / 93
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NOTE 13 – PROVISIONS
Current
Employee benefits
Total current
Non-current
Rehabilitation
Total non-current
Total
Movement in Provisions in 2022
Opening balance 1 July 2021
Additional provision recognised
Changes in rehabilitation estimate
Unwinding of discount (non-cash expense)
Amounts used during the year
Closing balance
2022
$000’s
1,274
1,274
17,357
17,357
18,631
Employee
benefits
$000’s
791
706
-
-
(223)
1,274
2021
$000’s
791
791
15,932
15,932
16,723
Total
$000’s
16,723
1,463
3,313
(2,564)
(304)
18,631
Rehabilitation
and site closure
$000’s
15,932
757
3,313
(2,564)
(81)
17,357
Accounting policy
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of past events, it is
probable that an outflow of resources will be required to settle the obligation, and the amount can be reliably estimated.
Employee benefits, salaries and annual leave
Liabilities for salaries, including non-monetary benefits and annual leave expected to be settled within 12 months of the
reporting date are recognised in respect of employee’s services up to the reporting date. They are measured at the amounts
expected to be paid when the liabilities are settled.
Employee benefits – long service leave
The liability for long service leave is recognised and measured at the present value of expected future payments to be made
in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is
given to expected future salary levels, experience of employee departures and periods of service. Expected future payments
are discounted using market yields at the reporting date on corporate bonds with terms to maturity and currency that match,
as closely as possible, the estimated future cash outflows.
The obligations are presented as current liabilities in the Consolidated Statement of Financial Position if the entity does not
have an unconditional right to defer settlement for at least twelve months after the reporting date, regardless of when the
actual settlement is expected to occur.
Rehabilitation
The Company has obligations to dismantle and remove certain items of property, plant and equipment and to restore and
rehabilitate the land on which they are situated.
A provision is raised for the estimated cost of settling the rehabilitation and restoration obligations existing at reporting date,
discounted to present value using an appropriate discount rate. When provisions for rehabilitation are initially recognised, the
corresponding cost is capitalised as an asset within mine properties and amortised accordingly.
Where rehabilitation is conducted systematically over the life of the operation, rather than at the time of closure, costs are
charged to the profit or loss in the period in which the work is undertaken.
At each reporting date the rehabilitation liability is re-measured to account for any new disturbance, updated cost estimates,
changes to the estimated lives of operations, new regulatory requirements and revisions to discount rates. Changes to the
rehabilitation liability are added to or deducted from the related rehabilitation asset and amortised accordingly.
94 / BCI MINERALS ANNUAL REPORT 22
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Key estimate – Rehabilitation
The Company’s accounting policy for the recognition of rehabilitation provisions requires significant estimates in determining
the estimated cost for the rehabilitation of disturbed areas, removal of infrastructure and site closure at a point in the future.
These uncertainties may result in future expenditure differing from the amounts currently provided.
A provision is made for the estimated cost to rehabilitate the Iron Valley site, which is offset by a receivable from Mineral
Resources Limited recognising the contractual requirement to rehabilitate the site.
NOTE 14 – BORROWINGS
Non-current borrowings
Convertible Note
Net carrying amount
June 2022
$000’s
19,718
19,718
June 2021
$000’s
-
-
On 17 November 2021, the Group entered into a Convertible Note agreement with AustralianSuper Pty Ltd as trustee for
AustralianSuper. The agreement comprises 3 series of Convertible Notes and during the interim period, the Company issued
the Series 1 Notes to AustralianSuper with a face value of $29.1M. The Series 1 note has been issued as consideration for the
Equity Investments acquired from AustralianSuper, as set out at Note 10. The transaction had no cash component, and the
key terms of the Series 1 Note are as follows:
Series 1 Convertible Note
• Non-interest-bearing note
•
10-year term
• Convertible at the election of AustralianSuper any time between 3.5 years from issue to final repayment date
• Note is convertible to ordinary shares of the Company at a 45% premium and conversion price per ordinary share of
$0.6235
• The conversion to ordinary shares is subject to certain anti-dilution clauses that may alter the conversion ratio in certain
circumstances
A reconciliation of the Convertible Note facility at inception is as follows;
Convertible note recognised as borrowings
Conversion option valued as equity (refer note 17)
Day one gain on inception
Value recognised on inception
At inception
$000’s
18,499
5,782
4,812
29,093
The initial fair value of the liability portion of the convertible note was determined using an implied market rate of interest
for an equivalent non-convertible liability at inception date. The liability, minus any transaction costs, will subsequently be
recognised on an amortised cost basis until conversion or maturity of the note.
The fair value of the conversion option has been determined using a Black Scholes option pricing model. The conversion
option is recognised in shareholders equity at inception and not subsequently remeasured. The key inputs used to value the
option are set out in the table below.
The day one gain on inception is calculated as the difference arising between the fair value of the liability portion of the
convertible note, the fair value of the conversion option and the fair value of the financial asset acquired. The gain has been
recognised in other comprehensive income as a day one gain on acquisition of the financial asset.
The debt element of the convertible notes is measured at amortised cost. An ‘effective interest rate’ has been determined
for the debt component based on the fair value interest rate adjusted for any debt issuance costs. Interest is recognized by
applying this rate to the carrying amount (including accrued interest) in each period and is capitalised when funds are used for
capital works or otherwise charged to the profit and loss.
BCI MINERALS ANNUAL REPORT 22 / 95
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When the fair value of financial assets or liabilities recorded in the financial statements cannot be derived from active markets,
the fair value is determined using valuation techniques such as Black-Scholes option pricing models and discounted cash
flow models. The inputs to these models are taken from observable markets where possible but where that is not feasible, a
degree of judgement is required to establish fair value. These judgements include consideration of inputs such as market price
volatility and risk-free interest rates. Changes in these assumptions may affect the fair value of financial instruments.
Key judgement
Convertible notes that have been determined to contain a debt and equity component are accounted for as a compound
financial instrument with the debt component recognised at fair value on inception then at amortised cost through profit
and loss while the equity component has been measured at fair value and recorded in reserves. In assessing the terms of the
convertible note and the requirements for a conversion option to qualify as equity, the group has considered the conversion
terms and anti-dilution clauses contained in the contractual agreement. Management have concluded that the anti-
dilution clauses do not lead to a breach of the fixed-for-fixed criteria as the clauses simply maintain the relative rights of the
Noteholders and shareholders.
Key inputs to valuation of conversion option
Term to conversion
Underlying share price
Strike price
Volatility
Risk free rate
Number of convertible notes
3.5 Years
$0.455
$0.62
50.0%
0.86%
46,672,013
NOTE 15 – CAPITAL RISK MANAGEMENT
The Company’s objective when managing capital is to safeguard its ability to continue as a going concern so that it can
continue to provide returns to shareholders and benefits for other stakeholders, and to maintain an optimal capital structure
to reduce the cost of capital. In order to maintain or adjust the capital structure, the Company may adjust the amount of
dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Company
defines capital as equity and net debt. Net debt is defined as borrowings less cash and cash equivalents, and equity as the sum
of share capital, reserves and accumulated losses/retained earnings.
NOTE 16 – CONTRIBUTED EQUITY
Share capital
Ordinary shares - fully paid
Movements in ordinary share capital
2022
2021
Number
$000’s
Number
$000’s
1,206,200,521
569,345
599,209,833
313,190
Opening balance
599,209,833
313,190
398,928,910
267,303
Issue of shares under Employee Performance Rights Plan
849,796
197
816,000
Placement and SPP Net of Costs
606,140,892
255,958
199,464,923
Closing balance
1,206,200,521
569,345
599,209,833
15
45,872
313,190
Accounting policy
Ordinary shares are classified as equity. Costs directly attributable to the issue of new shares or options are recorded in equity
as a deduction, net of tax, from the proceeds.
Terms and conditions of ordinary shares
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote
per share at shareholders’ meetings. In the event of winding up of the Company, ordinary shareholders rank after all other
shareholders and creditors are fully entitled to any proceeds of liquidations.
96 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
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CEO LETTER
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CONTENTS
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REPORT
NOTE 17 – RESERVES
Share based payments reserve
Balance as at 1 July
Share based payments expense
Issue of shares under Employee Performance Rights Plan
Balance as at 30 June
Financial assets at fair value through other comprehensive income
2022
$000’s
11,365
932
(197)
12,100
2021
$000’s
10,677
703
(15)
11,365
Balance as at 1 July
(9,009)
(9,009)
Day one gain on recognition of a financial asset (refer note 14)
Change in fair value of financial assets at balance date (refer note 10)
Balance as at 30 June
Equity reserve
Balance as at 1 July
Financial instruments recognised in equity
Balance at the end of the period
Options exercised reserve
Balance as at 1 July
Balance as at 30 June
Total reserves
4,812
9,573
5,376
-
5,782
5,782
3,787
3,787
27,045
-
-
(9,009)
-
-
-
3,787
3,787
6,143
Nature and purpose of reserves
The share-based payments reserve is used to recognise the fair value of options (not exercised), Performance Rights and
equity-settled benefits issued in settlement of share issue costs.
Changes in the fair value of investments such as equities measured at fair value through other comprehensive income, are
recognised in other comprehensive income and accumulated in a separate reserve within equity.
The equity reserve holds the equity component of the convertible notes and is not remeasured from inception. This value will
remain in the reserve until the convertible notes are converted or repaid.
NOTE 18 – ACCUMULATED LOSSES
Balance as at 1 July
Net (loss) / profit
Balance as at 30 June
2022
$000’s
(146,669)
(15,485)
(162,154)
2021
$000’s
(168,641)
21,972
(146,669)
BCI MINERALS ANNUAL REPORT 22 / 97
CONTENTS
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CEO LETTER
SUSTAINABILITY
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NOTE 19 – EARNINGS PER SHARE
Earnings per share from continuing operations
(Loss) / profit after income tax from continuing operations
2022
$000’s
(15,485)
Number
2021
$000’s
21,972
Number
Weighted average number of ordinary shares used in calculating basic earnings per
share
913,341,044
546,393,720
Adjustments for calculation of diluted earnings per share:
Vested Performance Rights outstanding at year end
Weighted average number of ordinary shares used in calculating diluted earnings per
share
Earnings per share attributable to the ordinary equity holders of the company
Basic (loss)/earnings per share
Diluted (loss)/earnings per share
1,989,000
1,989,000
915,330,044
548,382,720
Cents
(1.70)
(1.69)
Cents
4.02
4.01
Accounting policy
Basic earnings per share is calculated by dividing net profit after income tax attributable to equity holders of the Company by
the weighted average number of ordinary shares on issue during the financial year.
Diluted earnings per share is calculated using net profit after income tax attributable to equity holders of the Company
adjusted for the after-tax effect of dividends and interest associated with dilutive potential ordinary shares. The weighted
average number of shares used is adjusted for the weighted average number of ordinary shares that would be issued on the
conversion of all the dilutive potential ordinary shares into ordinary shares.
Risk Management
NOTE 20 – FINANCIAL RISK MANAGEMENT
The Company holds the following financial instruments:
Financial assets
Cash and cash equivalents
Short term investments
Shares in listed entities
Trade and other receivables
Financial liabilities
Trade and other payables
Loans and borrowings
2022
$000’s
232,021
657
38,666
36,214
307,558
65,031
17,978
83,009
2021
$000’s
79,435
681
-
71,672
151,788
37,548
-
37,548
Market (including foreign exchange, commodity price, security price risk and interest rate risk), credit and liquidity risks arise in
the normal course of the Company’s business. Primary responsibility for identification and control of financial risk rests with
senior management under directives approved by the Board.
a. Market risk
i. Foreign exchange risk
Foreign exchange risk arises from future commitments, assets and liabilities that are denominated in a currency that is not the
functional currency in which they are measured. The Company is not exposed to foreign exchange risk on trade receivables.
ii. Commodity price risk
The Company’s revenue is exposed to commodity price fluctuations, specifically iron ore prices. The Company measures
exposure to commodity price risk by monitoring and stress testing the Company’s forecast financial position to sustained
periods of low iron ore prices on a regular basis.
Trade receivables outstanding at year end are subject to potential changes in future iron ore prices.
98 / BCI MINERALS ANNUAL REPORT 22
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b. Credit risk
Credit risk arises from cash and cash equivalents and deposits with financial institutions, and from receivables from customers
for iron ore sales. For banks and financial institutions, only independently rated parties with a minimum rating of “A” are
accepted in accordance with ratings guidelines of major global credit rating agencies. For customers, credit reference checks
are undertaken. The carrying amount of financial assets recorded in the financial statements, net of any allowances for losses,
represents the Company’s maximum exposure to credit risk without taking account of the fair value of any collateral or other
security obtained.
The maximum exposure to credit risk at the reporting date is the carrying amount of the financial assets as summarised at the
beginning of this note.
The credit quality of financial assets that are neither past due nor impaired can be summarised as follows:
• Cash and cash equivalents $232.0M (2021: $79.4M) held with banks with minimum long term external credit rating of AA-.
• Short term investments $0.7M (2021: $0.7M) held with banks with a minimum long term external credit rating of AA-.
• Current trade and other receivables $18.8M (2021: $56.4M) due from existing customers are backed by an agreement with
quarterly invoices paid within 5 working days. There has been no history of default in the past.
• Non-current receivables $17.4M (2021: $15.8M) due from Mineral Resources Limited under a contractual arrangement as
described in Note 6. No default is expected.
c. Liquidity risk
Prudent liquidity management involves the maintenance of sufficient cash and access to capital markets. It is the policy of
the Board to ensure that the Company is able to meet its financial obligations and maintain the flexibility to pursue attractive
investment opportunities through keeping committed credit lines available where possible, ensuring the Company has
sufficient working capital and preserving the 15% share issue limit available to the Company under the ASX Listing Rules.
Maturity analysis of financial liabilities
The table below analyses the Company’s financial liabilities which comprise trade and other payables which have a maturity of
less than six months and lease liabilities with a fixed payment commitment of up to 4 years. Loans and borrowings consist of
equity conversion instruments which do not have any contractual cashflows associated with them.
Year ended 30 June 2022
Financial liabilities
Trade and other payables
Loans and borrowings
Year ended 30 June 2021
Financial liabilities
Trade and other payables
Carrying
amount
Within 1 yr
Between 1
and 2 years
Between 2
and 5 years
Over 5 years
Total
contractual
cashflows
$000’s
$000’s
$000’s
$000’s
$000’s
$000’s
65,031
19,718
84,749
56,983
8,048
-
-
56,983
8,048
-
-
-
-
65,031
19,718
19,718
-
65,031
Carrying
amount
Within 1 yr
Between 1
and 2 years
Between 2
and 5 years
Over 5 years
Total
contractual
cashflows
$000’s
$000’s
$000’s
$000’s
$000’s
$000’s
37,548
37,548
37,548
37,548
-
-
-
-
-
-
37,548
37,548
d. Equity price risk
Equity price risk refers to the risk that the value of a financial instrument or its associated cash flows will fluctuate due
to changes in the underlying share prices. The Group has exposure to equity price risk arising from its holding of listed
equity securities.
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Group Structure
NOTE 21 – SUBSIDIARIES
The consolidated financial statements include the financial statements of BCI Minerals Limited and the subsidiaries listed in
the following table.
Country of
incorporation
Functional
currency
Beneficial interest
BC Iron Nullagine Pty Ltd
BCI (SA) Pty Ltd
BC Potash Pty Ltd
BC Gold Pty Ltd
BC Pilbara Iron Ore Pty Ltd
PEL Iron Ore Pty Ltd
Mardie Minerals Pty Ltd
Iron Valley Pty Ltd
Mal’s Ridge Pty Ltd
Maitland River Pty Ltd
BCI Exploration Pty Ltd
Mardie Holdings Pty Ltd
Mardie Project Company Pty Ltd
Mardie Mine Holdings Pty Ltd
Mardie Port Pty Ltd
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
AUD
2022
%
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
2021
%
100
100
100
100
100
100
100
100
100
100
100
-
-
-
-
Accounting policy
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of BCI Minerals Limited as at 30
June 2022, and the results of all subsidiaries for the year then ended.
Subsidiaries are all entities (including structured entities) over which the Company has control. The Company controls an
entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the
ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the
date on which control is transferred to the group. They are deconsolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between entities in the Company are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of an asset transferred.
Accounting policies of subsidiaries are consistent with the policies adopted by the Company.
100 / BCI MINERALS ANNUAL REPORT 22
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NOTE 22 – SEGMENT INFORMATION
2022 Segment Information
Segment revenue
Sales revenue
Other revenue
Total
Segment results
EBITDA
Interest revenue
Finance costs
Depreciation and amortisation
Impairment of assets
Profit / (loss) before income tax
Segment assets
Segment liabilities
2022 Segment Information
Segment revenue
Sales revenue
Other revenue
Total
Segment results
EBITDA
Interest revenue
Finance costs
Depreciation and amortisation
Impairment of assets
Profit / (loss) before income tax
Iron Valley
Mardie
Buckland
Other
Consolidated
$000’s
$000’s
$000’s
$000’s
$000’s
65,198
-
65,198
-
-
-
27,782
(20,574)
-
-
-
-
(2,278)
(2,847)
-
-
25,504
(23,421)
65,265
202,025
16,114
62,248
-
-
-
-
-
-
-
-
-
-
-
-
598
598
65,198
598
65,796
(17,564)
(10,356)
599
(54)
(549)
-
599
(54)
(5,674)
-
(17,568)
(15,485)
269,374
536,664
25,810
104,172
Iron Valley
Mardie
Buckland
Other
Consolidated
$000’s
$000’s
$000’s
$000’s
$000’s
160,156
-
160,156
-
-
-
69,490
(34,419)
-
-
-
-
(3,006)
(1,547)
-
-
66,484
(35,966)
-
-
-
-
-
-
-
(2,233)
(2,233)
-
326
326
160,156
326
160,482
(6,173)
28,898
320
(40)
(420)
-
(6,313)
320
(40)
(4,973)
(2,233)
21,972
Segment assets
Segment liabilities
105,021
41,924
24,312
11,032
-
-
98,475
227,808
2,188
55,144
Management has determined that the Company has four reportable segments, being Iron Valley, Mardie, Buckland and Other
(Corporate and other assets).
Sales revenue comprises iron ore sales from a single location to a single customer in Australia.
Accounting policy
Operating segments are reported in a manner that is consistent with the internal reporting provided to the chief operating
decision maker. The chief operating decision maker has been identified as the Company’s Board. Internal reporting is provided
to the Board on a consolidated basis.
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Unrecognised Items
NOTE 23 – COMMITMENTS
The Company has property leases and vehicle leases. Future lease commitments are now disclosed as per AASB 16 – Leases,
refer to note 11 for further detail.
The Company has contracts with contractors for the progression of the Mardie Project that predominately rely on works to be
completed within contractual terms prior to payment. Contracts may contain clauses that in the event of a default a claim can
be raised to finalise works early. The total value remaining of contracts currently awarded is $282,090,000.
NOTE 24 – CONTINGENT LIABILITIES AND ASSETS
There are contractual claims for extensions of time and associated delay costs, relating to approvals and weather events at
Mardie resulting in access for the contractors to certain parts of the site. These claims are being assessed in accordance with
the usual contract management processes.
Aside from the above disclosure, the Company has no further contingent liabilities or assets other than additional cash
payments it may receive in respect of the sale of the Buckland project and Kumina tenements disclosed in prior years.
NOTE 25 – EVENTS OCCURRING AFTER THE REPORTING PERIOD
Performance Rights and Share Rights
On 8 August 2022, a total of 1,600,253 Performance Rights were granted to KMP under the approved Performance Rights
Plan. Rights granted are subject to a vesting period over which the fair value of such rights will be expensed. On 26 July 2022,
a total of 2,393,229 vested Performance and Share rights were converted to ordinary shares by a KMP.
Contractor Claims
Subsequent to year end, the Company notified a contractor that the contractor’s site access would be delayed due to a delay
in the construction of the road leading to the contractor’s site. The contractor has issued a claim under the contract for an
extension of time and delay costs. The claim is currently being assessed in accordance with the terms of the contact.
Other than disclosed above and throughout the report, no matters or circumstances have arisen since the end of the financial
year which significantly affected or may significantly affect the operations of the Company, the results of those operations, or
the state of affairs of the Company in financial periods subsequent to the year ended 30 June 2022.
Other Notes
NOTE 26 – PARENT ENTITY
The following details information related to the parent entity, BCI Minerals Limited, as at 30 June 2022. The information
presented here has been prepared using accounting policies consistent with those presented in the notes to the accounts.
Statement of Financial Position
Current assets
Total assets
Current liabilities
Total liabilities
Shareholders' equity
Issued capital
Reserves
Accumulated losses
Total shareholders' equity
(Loss) / Profit for the year
Total comprehensive (loss) / income for the year
2022
$000’s
210,801
358,718
6,048
21,123
569,345
27,173
(197,872)
398,646
(17,528)
(3,143)
2021
$000’s
78,787
188,806
1,757
67,217
313,190
6,271
(191,641)
127,820
(6,231)
(6,231)
Included in note 23 are commitments incurred by the parent entity relating to the lease of offices.
102 / BCI MINERALS ANNUAL REPORT 22
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PARENT COMPANY GUARANTEES
BCI has provided guarantees in respect of Group companies, as per the following:
A Parent Company Guarantee (“PCG”) granted by BCI in favour of Chevron Australia Pty Ltd (as the Gorgon Operator and
agent for and on behalf of each of the Gorgon Joint Interest Owners) dated 23 December 2021 (guaranteeing the obligations
of Mardie Minerals Pty Ltd under the Chevron Pipeline Access Agreement).
PCG granted by BCI in favour of Santos WA Northwest Pty Ltd (as the Varanus Operator and agent for and on behalf of each
of the Santos Owners) dated 23 December 2021 (guaranteeing the obligations of Mardie Minerals Pty Ltd under the Chevron
Pipeline Access Agreement).
PCG granted by BCI in favour of McConnell Dowell Constructors (Aust) Pty Ltd dated 10 February 2022 (guaranteeing the
obligations of Mardie Minerals Pty Ltd under the Port Marine Structures – Design and Construct Contract dated on or about
21 December 2021.
NOTE 27 – AUDITOR’S REMUNERATION
The auditor of BCI Minerals Limited is BDO Audit (WA) Pty Ltd
Amounts received or due and receivable by BDO Audit (WA) Pty Ltd for:
Audit or review of financial reports for the Company
Non-audit services – tax and remuneration advisory services
Total
NOTE 28 – RELATED PARTY TRANSACTIONS
a. Parent entity
BCI Minerals Limited is the parent entity.
b. Subsidiaries
Interests in subsidiaries are set out in note 21.
2022
$
77,320
7,382
84,702
c. Key management personnel
Disclosures relating to Key Management Personnel are set out in the Audited Remuneration Report.
Short-term employee benefits
Termination payments
Share based payments
Post-employment benefits
Total
d. Transactions with related parties
2022
$
2,228,378
-
630,944
131,368
2,990,690
2022
$
2021
$
62,000
91,100
153,100
2021
$
2,179,836
133,366
529,507
112,032
2,954,741
2021
$
Payment for services made to other related entities
1,164,079
1,338,221
On 1 March 2017, Michael Blakiston was appointed as a Non-Executive Director of the Company. Mr Blakiston is a partner in
the legal firm Gilbert + Tobin. During the current financial year, the Company made legal fee payments to Gilbert + Tobin
of $483K (2021: $720K). All transactions were on normal commercial terms and conditions.
During the year, a company within the same consolidated group as Wroxby Pty Ltd, a substantial shareholder of the
Company, provided the Company with rental premises for which payments were made in the amount of $681K (2021: $618K).
All transactions were on normal terms and conditions.
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NOTE 29 – SHARE BASED PAYMENTS
During the current and prior financial years, the Company has provided share-based payments to employees. An Employee
Performance Right Plan was initially approved at the shareholder’s annual general meeting of 19 November 2010 and a
revised Performance Right Plan and a Share Right Plan were approved at the Company’s annual general meeting held on
26 November 2019.
Under the terms of these plans, the Board may offer Performance Rights or Share Rights at no more than nominal
consideration to employees or directors (the latter subject to shareholder approval) based on a number of criteria, including
contribution to the Company, period of employment, potential contribution to the Company in the future and other factors
the Board considers relevant. These long-term incentives are provided to certain employees at the discretion of the Board to
deliver long-term shareholder returns. Set out below is a summary of the Performance Rights granted by the Company during
the financial year.
Employee Performance Rights
During the year the Company issued share-based payments in the form of Performance Rights to directors and employees as
per below. Refer to the Remuneration Report in the Directors’ Report for more information.
2022 – Performance Rights
Grant date
25/11/2021
30/07/2021
*Source: www.asx.com.au
Granted during
the year
1,110,118
868,188
Vesting date
3/07/2024
3/07/2024
Fair value per
right at grant date
Share price
on grant date*
Expected dividends
$0.287
$0.341
$0.53
$0.57
0%
0%
The fair value per Performance Right on grant date was determined as follows:
Grant date
Vesting date
Grant date share price
Volatility (per cent)
Dividend yield (per cent)
Risk free rate (per cent)
2021 – Performance Rights
Grant date
26/11/2020
31/05/2021
*Source: www.asx.com.au
25/11/2021
30/07/2021
Tranche 1
Tranche 2
03/07/2024
03/07/2024
$0.53
50.0
0
0.07
$0.57
47.5
0
0.03
Granted during
the year
7,152,888
620,000
Vesting date
30/06/2023
30/06/2023
Fair value per
right at grant date
Share price
on grant date*
Expected dividends
$0.128
$0.285
$0.26
$0.40
0%
0%
The fair value per Performance Right on grant date was determined as follows:
Grant date
Vesting date
Grant date share price
Volatility (per cent)
Dividend yield (per cent)
Risk free rate (per cent)
104 / BCI MINERALS ANNUAL REPORT 22
26/11/2020
31/05/2021
Tranche 1
Tranche 2
30/06/2023
30/06/2023
$0.26
60.0
0
0.07
$0.40
47.5
0
0.06
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Summary of Performance Rights on issue
Opening balance
at 1 July 2021
Rights granted
during the year
Rights cancelled/
lapsed during
the year
Rights converted
to shares during
the year
Closing balance
at 30 June 2022
Rights vested
since 30 June
2022
Vesting date
30/11/2020
30/11/2022
30/06/2023
03/07/2024
1,989,000
3,900,000
6,496,053
-
-
-
-
-
(1,468,750)
-
1,978,306
-
Total
12,385,053
1,978,306
(1,468,750)
-
-
-
-
-
1,989,000
(1,275,000)
3,900,000
5,027,303
1,978,306
-
-
-
12,894,609
(1,275,000)
Employee Share Rights
During the year the Company issued share based payments in the form of Share Rights to employees as per below.
Refer to the Remuneration Report in the Directors’ Report for more information.
2022 – Share Rights
Grant date
31/07/2021
25/11/2021
*Source: www.asx.com.au
Granted during
the year
516,196
262,431
Vesting date
04/07/2022
04/07/2022
Fair value per
right at grant date
Share price
on grant date*
Expected dividends
$0.537
$0.499
$0.57
$0.53
0%
0%
The fair value per Share Right on grant date was determined as follows:
Grant date
Vesting date
Grant date share price
Volatility (per cent)
Dividend yield (per cent)
Risk free rate (per cent)
2021 – Share Rights
Grant date
31/07/2020
26/11//2020
*Source: www.asx.com.au
31/07/2021
Tranche 1
25/11/2021
Tranche 2
04/07/2022
04/07/2022
$0.57
47.50
0
0.03
$0.53
50.0
0
0.2
Granted during
the year
Vesting date
Fair value per
right at grant date
Share price
on grant date*
Expected dividends
1,445,348
04/08/2021
855,798
04/08/2021
$0.190
$0.255
$0.190
$0.255
0%
0%
The fair value per Share Right on grant date was determined as follows:
Grant date
Vesting date
Grant date share price
Volatility (per cent)
Dividend yield (per cent)
Risk free rate (per cent)
31/07/2020
25/11/2020
Tranche 1
Tranche 2
04/08/2021
04/08/2021
$0.190
$0.255
60.0
0
0.07
60.0
0
0.07
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Summary of Share Rights on issue
Vesting date
04/08/2021
04/07/2022
Total
Opening balance
at 1 July 2021
Rights granted
during the year
Rights cancelled/
lapsed during
the year
Rights converted
to shares during
the year
Closing balance
at 30 June 2022
2,301,146
-
2,301,146
-
778,627
778,627
-
-
(748,031)
(101,765)
1,553,115
676,862
(849,796)
2,229,977
(1,118,229)
Rights vested
since 30 June
2022
(855,798)
(262,431)
a. Expenses arising from share-based payment transactions
Total expenses arising from share-based payments recognised during the financial period as part of employee benefits
expense were as follows. Where Performance Rights are forfeited or cancelled due to a non-market vesting condition not
being satisfied, the previously recognised cumulative share-based payment expense is reversed.
Director benefits
Employee benefits
Total
2022
$
371,665
539,176
910,841
2021
$
308,519
394,591
703,110
Accounting policy
The fair value of share-based payments granted is recognised as an employee benefit expense with a corresponding increase
in equity. The fair value is measured at grant date and recognised over the period during which the employees become
unconditionally entitled to the options or Performance Rights.
A Monte Carlo simulation is used to value Performance Rights. The Monte Carlo calculation simulates the Company’s share
price and depending on the hurdle arrives at a value based on the number of Performance Rights that are likely to vest.
The employee benefit expense recognised each period takes into account the most recent estimate of the options and
Performance Rights. The impact of revision to original estimates, if any, is recognised in the profit or loss with a corresponding
adjustment to equity.
Key estimate: Share-based payment valuation
The value of share-based payments to financiers is measured by reference to the difference between the nominal value and
net present value of the finance facility provided. The net present value is determined based upon a market comparable
discount rate applicable to similar size companies within the mining sector.
A Monte Carlo simulation has been used to value Performance Rights. The Monte Carlo calculation simulates the returns of
the Company in relation to the peer group and arrives at a value based on the number of Performance Rights that are likely
to vest.
106 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
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NOTE 30 – OTHER ACCOUNTING POLICIES
Summary of other significant accounting policies
Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, except where the GST incurred is not
recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as
part of the expense item.
Receivables and payables are stated inclusive of the amount of GST receivable or payable, where an invoice has been issued.
The net amount of GST recoverable from, or payable to, the taxation authority is included within receivables or payables in
the statement of financial position.
The GST component of cash flows arising from investing and financing activities, which is recoverable from or payable to
the taxation authority are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from or payable to the taxation
authority.
Fair value
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. It is based on the presumption that the transaction takes place either in
the principal market for the asset or liability or, in the absence of a principal market, in the most advantageous market.
The principal or most advantageous market must be accessible to, or by, the Company. Fair value is measured using the
assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in
their best economic interest.
The fair value measurement of a non-financial asset takes into account the market participant’s ability to generate economic
benefits by using the asset at its highest and best use or by selling it to another market participant that would use the asset at
its highest and best use.
In measuring fair value, the Company uses valuation techniques that maximise the use of observable inputs and minimise the
use of unobservable inputs.
Tax consolidation legislation
BCI Minerals Limited and its wholly owned Australian controlled entities have entered into the tax consolidation legislation.
On adoption of the tax consolidation legislation, the entities in the tax consolidated group entered into a tax sharing
agreement which, limits the joint and several liability of the wholly owned entities in the case of a default by the head entity,
BCI Minerals Limited.
The entities entered into a tax funding agreement under which the wholly owned entities fully compensate BCI Minerals
Limited for any current tax payable assumed and are compensated by BCI Minerals Limited for any current tax receivable
and deferred tax assets relating to unused tax losses or unused tax credits that are transferred to BCI Minerals Limited under
the tax consolidation legislation. The funding amounts are determined by reference to the amounts recognised in the wholly
owned entities’ financial statements.
The amounts receivable or payable under the tax funding agreement are due upon receipt of the funding advice from the
head entity, which where appropriate, is issued as soon as practicable after the end of each financial year. The head entity may
also require payment of interim funding amounts to assist with its obligations to pay tax instalments. The funding amounts are
recognised as current intercompany receivables or payables.
New, revised or amending Accounting Standards and Interpretations adopted
There are no new accounting standards, amendment of standards or interpretations that are yet to be implemented by
the Group.
BCI MINERALS ANNUAL REPORT 22 / 107
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Independent Auditor’s Report
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
Level 9, Mia Yellagonga Tower 2
5 Spring Street
Perth WA 6000
PO Box 700 West Perth WA 6872
Australia
INDEPENDENT AUDITOR’S REPORT
To the members of BCI Minerals Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of BCI Minerals Limited (the Company) and its subsidiaries (the
Group), which comprises the consolidated statement of financial position as at 30 June 2022, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement
of changes in equity and the consolidated statement of cash flows for the year then ended, and notes
to the financial report, including a summary of significant accounting policies and the directors’
declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its
financial performance for the year ended on that date; and
(ii)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia
Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO
International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability
limited by a scheme approved under Professional Standards Legislation
108 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
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DIRECTOR’S
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REPORT
CONTENTS
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REPORT
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
Accounting for convertible notes
Key audit matter
How the matter was addressed in our audit
During the year, BCI Minerals Limited (“the
Our audit procedures in this area included, but were not
Company”) entered into a convertible note
limited to:
arrangement with AustralianSuper Pty Ltd as
trustee for Australian Super. The agreement
comprises of 3 series of convertible notes with the
Company issuing the first series during the period
with a face value of $29.1m. The company received
listed investments as consideration for the
convertible note. Refer to Note 14 for further
details.
We have identified the accounting and valuation of
the convertible notes as a key audit matter due to
the complexity and judgements involved in
determining the various conversion features which
can have a significant effect on the classification of
the components of this instrument together with
complexities as to the initial and subsequent
measurement of the identified components.
•
•
•
•
•
•
Reviewing the convertible note agreements to
understand the key terms and conditions of the
arrangement;
Assessing whether management’s assessment of the
classification of the components contained within the
instrument was in accordance with accounting
standards;
Reviewing management’s independent expert
valuation of the instrument, including assessing the
methodology used;
Consulting with our internal accounting specialists on
the accounting treatment adopted, specifically on
the treatment of anti-dilution features on the notes
issued;
Recalculating the fair value of the liability
component; and
Assessing the adequacy of the related disclosures at
Note 14 in the financial report.
BCI MINERALS ANNUAL REPORT 22 / 109
CONTENTS
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CEO LETTER
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REPORT
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FINANCIAL REPORT
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REPORT
CONTENTS
CHAIR’S LETTER
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ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Mardie development expenditure
Key audit matter
How the matter was addressed in our audit
The Group has significantly increased its
Our audit procedures in this area included, but were not
development expenditure on the Mardie Salt and
limited to:
Potash project during the year as reflected in Note
7. This represents a significant increase in the
volume, quantum and complexity of transactions
for the Group.
Due to the significance of the costs incurred during
the period and level of transactional activity we
have identified the accounting for development
expenditure as a key audit matter.
•
•
•
•
•
•
•
Reviewing Board minutes and ASX announcements to
understand the operational activity relating to the
project;
Reviewing significant contracts to understand the key
terms and conditions and evaluating any associated
accounting impacts;
Understanding the process for project cost allocation
and recording of expenditure relating to various
components of the project development;
Obtaining an understanding of and testing key
controls in relation to capital expenditure during the
year;
Obtaining the year end reconciliation of capital work
in progress and agreeing a sample of items to
supporting source documentation;
Assessing the appropriateness of the classification of
expenditure as either operating or capital; and
Reviewing the related disclosures in the year-end
financial statements
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s Annual Report for the year ended 30 June 2022, but does not include the
financial report and the auditor’s report thereon, which we obtained prior to the date of this auditor’s
report, and the Annual Report, which is expected to be made available to us after that date.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
110 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
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ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
When we read the Annual Report, if we conclude that there is a material misstatement therein, we are
required to communicate the matter to the directors and will request that it is corrected. If it is not
corrected, we will seek to have the matter appropriately brought to the attention of users for whom
our report is prepared.
Responsibilities of the directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:
http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf
This description forms part of our auditor’s report.
BCI MINERALS ANNUAL REPORT 22 / 111
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
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ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
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ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 11 to 21 of the directors’ report for the
year ended 30 June 2022.
In our opinion, the Remuneration Report of BCI Minerals Limited, for the year ended 30 June 2022,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit (WA) Pty Ltd
Phillip Murdoch
Director
Perth, 24 August 2022
112 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
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DIRECTOR’S
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ANNUAL
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CONTENTS
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CEO LETTER
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ANNUAL
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AUDITOR’S
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Auditor’s Independence Declaration
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
Level 9, Mia Yellagonga Tower 2
5 Spring Street
Perth WA 6000
PO Box 700 West Perth WA 6872
Australia
DECLARATION OF INDEPENDENCE BY PHILLIP MURDOCH TO THE DIRECTORS OF BCI MINERALS
LIMITED
As lead auditor of BCI Minerals Limited for the year ended 30 June 2022, I declare that, to the best of
my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of BCI Minerals Limited and the entities it controlled during the period.
Phillip Murdoch
Director
BDO Audit (WA) Pty Ltd
Perth, 24 August 2022
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia
Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO
International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability
limited by a scheme approved under Professional Standards Legislation
BCI MINERALS ANNUAL REPORT 22 / 113
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
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CEO LETTER
DIRECTOR’S
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ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Additional ASX Information
(as at 16 September 2022)
SUBSTANTIAL SHAREHOLDERS
Substantial shareholders as disclosed in substantial notices given to the Company are as follows:
Rank
Shareholder
1
2
3
Wroxby Pty Ltd
AustralianSuper Pty Ltd
Ryder Capital Limited
DISTRIBUTION OF SHAREHOLDINGS
Size of shareholding
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 Over
Total
UNMARKETABLE PARCELS
Date of notice
Shares held
% of issued capital
14 October 2020
24 December 2021
24 December 2021
236,750,238
168,914,852
119,814,614
39.56
14.01
9.93
Number of holders
Number of shares
% of issued capital
1,246
2,613
1,171
2,619
616
8,265
557,954
7,247,688
9,233,575
90,676,787
1,103,305,403
1,211,021,407
0.05
0.60
0.76
7.49
91.11
100.00
There were 1,972 members holding less than a marketable parcel of shares in the Company at $0.250 per share.
TWENTY LARGEST SHAREHOLDERS
Rank
Shareholder
Shares held
% of issued capital
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
Wroxby Pty Ltd
J P Morgan Nominees Australia Pty Limited
Ryder Capital Management Pty Ltd
Citicorp Nominees Pty Limited
Norfolk Enchants Pty Ltd
One Managed Invt Funds Ltd
One Fund Services Ltd
BNP Paribas Noms Pty Ltd
HSBC Custody Nominees (Australia) Limited - A/C 2
HSBC Custody Nominees (Australia) Limited
Mr Alwyn Petrus Vorster
Mineralogy Pty Ltd
One Managed Invt Funds Ltd <1 A/C>
BNP Paribas Nominees Pty Ltd
BNP Paribas Noms Pty Ltd
Mr Dennis Jonathan Kar Que Lum
Ms Karen Anne Davies + Mr Bruce Donald Maclean
Heagra Pty Limited
Bond Street Custodians Limited
20
Barolo Investments Company #1 Pty Ltd
Total
114 / BCI MINERALS ANNUAL REPORT 22
476,285,122
214,897,918
79,839,119
23,236,619
19,500,000
14,204,263
12,331,114
12,021,425
10,787,705
8,157,834
7,768,642
6,090,000
6,069,768
4,527,359
4,409,059
4,034,407
3,345,636
3,045,000
2,500,000
2,325,582
915,376,572
39.33
17.75
6.59
1.92
1.61
1.17
1.02
0.99
0.89
0.67
0.64
0.50
0.50
0.37
0.36
0.33
0.28
0.25
0.21
0.19
75.59
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
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ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
CONTENTS
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CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
VOTING RIGHTS
All issued shares carry voting rights on a one for one basis.
Security Type
Performance Rights
Share Rights
Voluntary Escrowed Shares (until 04/07/23)
CONVERTIBLE NOTES
Security Type
Convertible Notes Series 1 (a)
(a) All Convertible Notes Series 1 held by AustralianSuper Pty Ltd.
In accordance with ASIC Corporations (Sale Offers:
Securities Issued on Conversion of Convertible Notes)
Instrument 2016/82, BCI provides the following
information in relation to the convertible notes which it
currently has on issue:
BCI issued 46,662,048 Series 1 Convertible Notes on
24 December 2021, which have an aggregate face value
of $29,093,787.
The maturity date of the Series 1 Convertible Notes is
10 years after date of issuance (unless all Series 1
Convertible Notes are redeemed or converted earlier).
The Company must repay the face value of the Series 1
Convertible Notes at maturity, or earlier on demand by
the holder in the event of default by BCI.
The holder may elect to convert the Series 1 Convertible
Notes into Shares at any time from 3.5 years after issue
and prior to maturity. The holder may also elect to convert
earlier in the event of default or change of control of BCI.
Number
8,861,120
2,342,335
132,108
Number of holders
21
11
1
Number
46,662,048
Number of holders
1
Upon conversion of the Series 1 Convertible Notes,
the number of Shares to be issued to the holder will
be calculated on the following basis:
“Principal Outstanding / Conversion Price”
The “Principal Outstanding” is the face value of the
Series 1 Convertible Notes. The Series 1 Convertible
Notes do not bear any interest.
The “Conversion Price” is the initial conversion price
of A$0.6235 adjusted for certain corporate actions
of the Company during the term of the Series 1
Convertible Notes.
Assuming that no adjustments are made to the
Conversion Price, a total of 46,662,048 Shares would
be issued on conversion of the Series 1 Convertible Notes.
BCI MINERALS ANNUAL REPORT 22 / 115
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CONTENTS
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DIRECTOR’S
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ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Mineral Resources and Ore Reserves
BCI’s Mineral Resources and Ore Reserves are at the Iron Valley iron ore mine. The Iron Valley tenements are 100% owned by
BCI and are being operated by Mineral Resources Limited (MIN) under a royalty-type agreement. MIN operates the mine at its
cost and purchases Iron Valley product from BCI at a price linked to MIN’s realised sale price.
Estimates for Iron Valley as at 30 June 2022 are set out below, with a comparison to 30 June 2021 figures. Mineral Resources
reduced by 6.1Mt during the year due to mining depletion and stockpile reduction. Ore Reserves reduced by 13.8Mt due to
production shipments, stockpile adjustments and re-optimisation based on updated price and cost assumptions.
IRON VALLEY MINERAL RESOURCE ESTIMATE (100% BCI, SUBJECT TO IRON ORE SALE AGREEMENT WITH MIN)
Classification
Measured – In-situ
Measured – Stockpiles
Indicated – In-situ
Inferred – In-situ
Total at 30 June 2022
Total at 30 June 2021
Cut-off
Tonnes
(% Fe)
50
50
50
50
50
50
(Mt)
74.6
1.2
65.4
26.0
167.2
173.3
Fe
(%)
57.7
55.2
58.6
57.8
58.0
58.0
CaFe
(%)
62.7
60.2
63.0
61.3
62.6
62.6
SiO2
Al2O3
(%)
5.2
7.3
5.2
6.7
5.4
5.4
(%)
3.2
4.3
3.2
3.9
3.3
3.3
P
(%)
0.19
0.20
0.17
0.14
0.17
0.17
IRON VALLEY ORE RESERVE ESTIMATE (100% BCI, SUBJECT TO IRON ORE SALE AGREEMENT WITH MIN)
Classification
Proved – In-situ
Proved – Stockpiles
Probable – In-situ
Total at 30 June 2022
Total at 30 June 2021
Cut-off
Tonnes
(% Fe)
54
54
54
54
54
(Mt)
38.7
1.2
14.6
54.5
68.3
Fe
(%)
58.1
55.2
58.7
58.2
58.2
CaFe
(%)
63.1
60.3
63.2
63.1
63.1
SiO2
Al2O3
(%)
4.6
7.3
4.9
4.7
4.9
(%)
3.2
4.3
3.1
3.2
3.2
P
(%)
0.19
0.17
0.16
0.18
0.18
LOI
(%)
7.9
8.4
7.1
5.6
7.2
7.3
LOI
(%)
7.9
8.4
7.1
7.7
7.7
Notes:
• Tonnages are dry metric tonnes and have been rounded. Any small differences in totals are due to rounding.
• CaFe% is calcined Fe% calculated using the following formula: Fe% / (100% - LOI%) * 100.
• Stockpiles have been converted to dry tonnes based on an average moisture content of 7.0%.
• Stockpiles include 0.3Mt of post-process lump and fines products and 0.9Mt of pre-process ore.
MINERAL RESOURCES AND ORE RESERVES GOVERNANCE
Iron Valley Mineral Resource and Ore Reserve estimates are completed by or under the guidance of a suitably qualified MIN
or independent Competent Person in accordance with JORC (2012) guidelines. BCI is satisfied with the procedures MIN has
advised it has in place for Mineral Resource and Ore Reserve estimation. BCI personnel have also reviewed the documentation
and are comfortable with the methodologies used by MIN.
The Mineral Resource and Ore Reserves statement included in the Annual Report is reviewed and approved by a suitably
qualified Competent Person prior to its inclusion.
116 / BCI MINERALS ANNUAL REPORT 22
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COMPETENT PERSON’S STATEMENTS
The information in this report that relates to the Mineral Resource estimate at Iron Valley is based on, and fairly represents,
information that has been compiled by Mr Ashok Doorgapershad, who is a full-time employee of Mineral Resources Limited
and a Member of the Australasian Institute of Mining and Metallurgy. Mr Doorgapershad has sufficient experience that is
relevant to the style of mineralisation and type of deposit under consideration and to the activity that is being undertaken to
qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves’. Mr Doorgapershad consents to the inclusion in this report on the matters based on his
information in the form and context in which they appear.
The information in this report that relates to the Ore Reserve estimate at Iron Valley is based on, and fairly represents,
information that has been compiled by Mr Guy Davies, who is a full-time employee of Mineral Resources Limited and a
Member of the Australasian Institute of Mining and Metallurgy. Mr Davies has sufficient experience that is relevant to the
style of mineralisation and type of deposit under consideration and to the activity that is being undertaken to qualify as a
Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves’. Mr Davies consents to the inclusion in this report on the matters based on his information in
the form and context in which they appear.
The Mineral Resources and Ore Reserves statement in this report has been approved by Mr Guy Davies, who is a full-time
employee of Mineral Resources Limited and a Member of the Australasian Institute of Mining and Metallurgy. Mr Davies
consents to the inclusion in this report of the Mineral Resources and Ore Reserves statement in the form and context in
which it appears.
BCI MINERALS ANNUAL REPORT 22 / 117
CONTENTS
CONTENTS
CHAIR’S LETTER
CHAIR’S LETTER
INTERIM
INTERIM
CEO LETTER
CEO LETTER
SUSTAINABILITY
SUSTAINABILITY
DIRECTOR’S
ANNUAL
FINANCIAL REPORT
REPORT
ANNUAL
AUDITOR’S REPORT
FINANCIAL REPORT
AUDITOR’S
CORPORATE
DIRECTORY
REPORT
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
Corporate Directory
BCI Minerals Limited
ABN 21 120 646 924
REGISTERED OFFICE AND
PRINCIPAL PLACE OF BUSINESS
Level 1, 1 Altona Street
West Perth, Western Australia 6005, Australia
Telephone: +61 (08) 6311 3400
Website: www.bciminerals.com.au
info@bciminerals.com.au
Email:
POSTAL ADDRESS
GPO Box 2811
Perth, Western Australia 6001, Australia
NON-EXECUTIVE DIRECTORS
Brian O’Donnell – Chair
Michael Blakiston
Richard Court
Garret Dixon
Chris Salisbury
Miriam Stanborough
JOINT COMPANY SECRETARIES
Susan Park
Stephanie Majteles
SHARE REGISTRY
Investors seeking information about their shareholdings
should contact the company’s share registry:
Computershare Investor Services Pty Limited
Level 11, 172 St Georges Terrace
Perth, Western Australia 6000
Postal address: GPO Box 2975,
Melbourne Victoria 3001
Telephone:
1300 850 505 (within Australia)
+61 3 9415 4000 (outside Australia)
Facsimile:
(03) 9473 2500 (within Australia)
+61 3 9473 2500 (outside Australia)
Email:
web.queries@computershare.com.au
Website:
www.investorcentre.com/contact
The share registry can assist with queries on share
transfers, dividend payments and changes of name,
address or bank account details.
For security reasons, you will need your Security Reference
Number (SRN) or Holder Identification Number (HIN)
when communicating with the share registry.
AUSTRALIAN SECURITIES EXCHANGE LISTING
BCI Minerals Limited securities are listed on the
Australian Securities Exchange (ASX) under the code BCI.
118 / BCI MINERALS ANNUAL REPORT 22
CONTENTS
CHAIR’S LETTER
SUSTAINABILITY
INTERIM
CEO LETTER
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
CORPORATE
AUDITOR’S
DIRECTORY
REPORT
CONTENTS
CHAIR’S LETTER
INTERIM
CEO LETTER
SUSTAINABILITY
DIRECTOR’S
REPORT
ANNUAL
FINANCIAL REPORT
AUDITOR’S
REPORT
www.bciminerals.com.au
Level 1, 1 Altona Street, West Perth,
Western Australia 6005, Australia
GPO Box 2811, Perth, WA 6001
Telephone: +61 (08) 6311 3400
Facsimile: +61 (08) 6311 3449
Email: info@bciminerals.com.au
ABN 21 120 646 924