2018 Annual
Report
Contents
01
Year in review
Chairman’s and CEO’s report
Operating and financial review
Our commitment
Our people
Directors’ report
Remuneration report
2 Bathurst Resources Limited Annual Report 2018
02
Financial statements
Income statement
Statement of comprehensive income
Balance sheet
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
Additional information
Independent auditor’s report
6
10
16
32
36
38
45
46
47
48
49
50
81
84
03
Shareholder information
04
Resources and reserves
Shareholder information
92
Tenement schedule
Coal resources and reserves
Corporate directory
98
101
112
3
Strong safety record
with LTIFR at 1.2
Coal production under
management up from
0.4Mt to >2Mt
Contributed
$161.1m
to the New Zealand economy
Invested
$52.7m
in CAPEX
Successful acquisition of
three new operating mines
New offshore joint
venture secured
Financial figures noted are Bathurst and 65 percent equity share of BT Mining.
4 Bathurst Resources Limited Annual Report 2018
4 Bathurst Resources Limited Annual Report 2017
01
01
Year in review
Year in Review
In this section
In this section
Chairman’s and CEO’s report
Chairman’s and CEO’s report
Operating and financial review
Operating and financial review
Our commitment
Our commitment
Our people
Our people
Directors’ report
Directors’ report
Remuneration report
Remuneration report
Section 1: Year in review 5
Section 1: Year in review 5
Chairman’s and
CEO’s report
We are delighted to share with you the 2018 Annual Report for Bathurst. This year
has marked a significant shift in the size and scope of Bathurst’s operations, with
exciting opportunities just around the corner.
Delivering on our promises
FY 2018 saw the successful acquisition of the previous
Solid Energy mine sites at Rotowaro, Maramarua and Stockton
via Bathurst’s joint venture BT Mining, making Bathurst
New Zealand’s largest coal producer. We were focused on two
key tasks throughout this period: sustaining Bathurst’s original
South Island domestic mining operations (“SID”), and the safe
and smooth transition of the acquired mines and their staff into
Bathurst’s systems and processes.
We are very pleased with the results from Bathurst’s existing
SID operations, noting an increase in coal sales revenue which
flowed through to an increase in the SID segment’s EBITDA.
BT Mining has exceeded expectations in its first ten months
of operations, profiting from a focused transition programme,
strong export coal price, and rationalisation of corporate
overhead spend. Initial debt of $29.8 million was repaid, as well
as a first distribution to its shareholders. We set up a new
regional office in Christchurch to ensure the seamless supply of
essential corporate services, and we were able to retain almost
all regional mining operations staff.
Extensive risk management assessments were also performed,
alongside a focus on site training and worker engagement
practices.
Overall our equity share of EBITDA guidance across all
operations was upgraded from $61.0 million in Q1 to $91.0
million in Q3, finishing the year at a record $93.7 million.
What our business looks like now
The face of our business has changed dramatically in the last
12 months, moving from a sole domestic focus to include an
export segment, and more than quadrupling the number of
employees and coal production that we manage.
Our export business now contributes over half of total revenue.
We support over 400 jobs across New Zealand, with the majority
in regional areas. Our expansion via BT Mining has meant that
not only do we benefit our shareholders, but also the
New Zealand economy as a whole.
6 Bathurst Resources Limited Annual Report 2018
Record financial results
Underlying profit (adjusted for several one-off items) increased
from $1.1 million to $43.4 million, highlighting the significant
contribution that BT Mining has made to our business.
While overall net profit after tax was negatively impacted by
$32.1 million of one-off, non-cash fair value accounting
adjustments on our convertible debt instruments, we still
recorded Bathurst’s highest net profit after tax since
incorporation. The confidence of our shareholders in the
management team which enabled the investment in BT Mining,
was earned through a consistent, cost-effective and efficiency
driven management philosophy and pro-active key stakeholder
management.
We were very pleased to release details of an approved
on-market share buyback scheme off the back of the release of
the annual results. Directors consider the buyback offer is
accretive in the overall value of the Company’s shares, and
represents the first of new capital management initiatives after a
successful year.
Any dividends have been postponed until after the decision from
the Court of Appeal is received regarding the litigation brought
against Bathurst by L&M Coal Holdings Limited (“LMCH”). This
is expected to be mid-2019.
Strategy
During the year we refreshed our strategy, with our vision to be
the leading domestic and export coal producer in New Zealand,
with a globally diversified coking coal portfolio. We work towards
our goal with a multi-faceted approach, focusing on four key
areas: operations, people and community, safety, and customers/
markets. This recognises the integral part that each of these
plays in the long-term success of our business.
We have also taken the first steps this year to provide key
metrics on sustainability in our business, via a sustainability
supplement detailed in the Our commitment section. This
supplement provides a focus on our performance in the areas
most important to us. Next year we aim to provide further detail
through a sustainability report.
With Bathurst now firmly cemented as New Zealand’s leading
coal producer, opportunities were sought to develop investment
offshore. This recognises that potential for future growth in the
New Zealand market is only incremental through brownfield
expansions, due to both natural market limitations and the
uncertain long-term regulatory environment.
After intensive due diligence, we were delighted to announce
the successful close of a new joint venture with Jameson
Resources Limited (“Jameson”). The initial investment of CAD
$4.0 million gave Bathurst an initial eight percent stake in NWP
Coal Canada Limited (“NWP”) (a previously wholly owned
subsidiary of Jameson), and investment in NWP’s Crown
Mountain Coking Coal Project.
The project consists of coal licences and applications in
south eastern British Columbia, Canada. The project is in the
exploration stages of pre-feasibility and will provide Bathurst
with a diversity of production into the export market that will
complement in-house technical and marketing capabilities and
the range of products already sold into Asia.
Upcoming challenges
While our overall operations have generally performed above
expectations and ahead of early forecasts, we recognise the
need to maintain focus on the upcoming Court of Appeal
process regarding the LMCH litigation. Although the decision
by the High Court was unfavourable, based on our legal team’s
advice the Board remains confident in its view that it will be
successful on appeal.
Looking forward
Looking ahead to the coming financial year, a key focus across
all operations is cost control and maintaining margins. This will
be achieved through several initiatives including equipment
replacement, mine plan re-designs and process efficiencies.
We also know how important managing risk is to achieving
success in our industry. Continuing our ongoing risk
management programme will be critical to ensure we achieve
safety for our employees, and the desired long-term
environmental and financial outcomes.
With a strong new business base laid this year, we look
forward to the continued success of our mines and our people.
Toko Kapea
Chairman
Richard Tacon
Chief Executive Officer
Section 1: Year in review 7
8 Bathurst Resources Limited Annual Report 2018
Section 1: Year in review 9
Operating and
financial review
Bathurst at a glance
Key
Export
Domestic
Care + maintenance
Office
Distribution facility
Tonnes noted are FY18 production tonnes
Maramarua
0.1Mt
Rotowaro
0.7Mt
Stockton
0.9Mt
Buller
Wellington
Canterbury
0.1Mt
Takitimu
0.2Mt
Timaru
Christchurch
10 Bathurst Resources Limited Annual Report 2018
“We are now New Zealand’s
largest coal producer
Bathurst has grown from a 0.4 million tonnes (“Mt”) a year producer of coal, to
be the largest coal company in New Zealand managing over 2Mt via its recent
acquisition of the Stockton, Rotowaro and Maramarua mines.
Sales profile
With the addition of the three new mines, the sales mix and profile of our business have changed substantially from a year ago.
Sales revenue by product use*
Sales by region (Mtpa)*
9%
7%
0.4Mt
20%
64%
0.8Mt
1.0Mt
64% Steelmaking (Export)
20% Food production and
other industry (NZ)
9% Steelmaking (NZ)
7% Electricity (NZ)
1.0Mt
Export - Stockton
0.4Mt
South Island Domestic
0.8Mt
North Island Domestic
Sales revenue mix has moved from 100 percent domestic food
production and other industry, to include electricity and
steelmaking in both the domestic and export markets.
82 percent of Bathurst’s sales now come from its recently
acquired mines.
*Figures are Bathurst and BT Mining at 100% for FY18
Section 1: Year in review
11
Operating highlights
Maramarua
Export (Stockton – 65 percent equity share)
Stockton is an open cut mine on the West Coast of the South
Island, producing a low ash metallurgical coal for export primarily
to Japan, Korea and India.
Coal production at Maramarua was impacted during the year by
a known fault lying at a flatter angle than modelled. This
combined with inclement weather meant the mine was unable to
continuously supply coal, with sales being diverted to Rotowaro
from early December.
Stockton sold 0.97Mt of coal during FY18 and shifted 2.9Mbcm
of overburden. EBITDA contribution for ten months of operations
was $105.9 million (at 100% basis). Production levels are
budgeted to increase to 1.1Mt in FY19.
We added a third mining crew in January to accelerate waste
stripping into the next block of coal. This meant coal production
could resume in February, with a steady state of operations
achieved by Q4 of FY18.
The mine plan was re-worked to achieve a steady production
rate over the next four years, which required the addition of a
fourth overburden stripping crew. An equipment replacement
strategy of rationalising the mobile plant fleet, lowering site
operating costs and ensuring fit-for-purpose equipment was
implemented. We are in the process of eliminating high cost
machinery from the site.
The export market was relatively stable, with coal prices
remaining strong. We have prepared for any price fluctuations
through a continued focus on maintaining cash costs under
NZD$100/tonne FOB, and diversification in customers and
markets. Mine and market planning are managed to match the
market with resources to ensure a reliable supply delivering
on-specification coal to our customers.
North Island Domestic
(65 percent equity share)
Rotowaro and Maramarua open cut mines are located in the
Waikato region of the North Island. Both mines have long-term
contracts to primarily supply the domestic steel and electricity
industries, with the remainder supplied to local food production
and other industries.
EBITDA for ten months of operations from this segment was
$34.2 million (at 100 percent basis). FY19 operations will look
consistent with FY18.
Rotowaro
Rotowaro produced 86 percent of the North Island output for the
ten months of FY18. Run of mine coal production exceeded
budget to meet additional sales diverted from Maramarua.
Overburden was slightly behind budget due to low manning
levels and mechanical breakdowns. Improved detailed mine
planning has allowed for planned waste stripping in the relatively
small east extension area of the Awaroa 4 pit.
Coal production in the main pit is due to be completed in the
early part of FY19, with planning well advanced in support of the
Waipuna West extension. Market dependent, waste stripping is
scheduled to commence in the second quarter of FY19.
Our focus for FY19 is to develop stage one of the next pit to
replace production from the current pit. The timely development
and exposure of first coal in this new pit is crucial to
Maramarua’s mine plan.
South Island Domestic (100 percent equity share)
The Canterbury and Takitimu mines represent the existing
Bathurst business, prior to acquisition of the Stockton and North
Island mines. Both mines produce energy coal which is low in
sulphur and ash and high in demand by the local food processing
industries that they supply.
These mines continue to generate positive cash flows, with FY18
showing a five percent growth in EBITDA to $16.7 million. This
came off the back of new sales contracts won in FY17.
Looking ahead to FY19, coal production and waste stripping for
both mines are consistent with FY18. The strip ratio will remain
higher than the average life of mine as we continue to expand
the footprint at both sites.
Canterbury
The Canterbury mine is an open cast mine near Coalgate,
70 kilometres west of Christchurch.
This year the mine increased coal production significantly to
meet increased sales. This involved the establishment and
substantial completion of an engineered landform (“ELF”) to
the north of operations to enable a matching increase in waste
stripping. The operation is now backfilling in the resultant void
and the ELF will commence rehabilitation in the coming year.
We also invested significant resources in water quality
management measures at the mine. The site is seeing these
positive effects with work largely complete and full compliance
since February 2018.
Further upgrades to the mining fleet were made in FY18 to
increase efficiencies and move away from high rental costs,
notably with the purchase of two dozers, one loader and two
dump trucks.
12 Bathurst Resources Limited Annual Report 2018
Takitimu
Exploration and permits
The Takitimu mine is located at Nightcaps, north of Invercargill
in Southland.
FY18 operations saw a modest three percent uplift in run of mine
coal production, and a 26 percent uplift in overburden as work
on the Black Diamond pit came on line. One of the key
achievements during the year was the excavation of the historic
open cast, Black Diamond East open cast, which exposed intact
and clean coal below the old pit.
With the move into the historically underground worked Black
Diamond area there has been a focus to establish safe operating
practices on working around voids. This included the
establishment and training of an onsite Emergency Rescue
Team, purchase and training of rescue equipment and holding
training exercises.
Takitimu also saw investment in its mining fleet during the year
to realise significant reduction in high rental costs, with the
purchase of an excavator and four dump trucks.
Buller (100 percent equity share)
The Buller project represents several mine permits on the
Denniston Plateau on the west coast of the South Island that
are in close proximity to the Stockton mine operations. These
include the Escarpment and Cascade mines for which mining
permits are held, but which are currently on care and
maintenance.
The Buller coalfield is regarded as one of New Zealand’s most
significant fields and is well known for its high quality, low ash
and high fluidity coking coals, which are highly sought after by
international steelmakers. We hold mine permits for more than
15,000 hectares.
The combination of BT Mining’s infrastructure assets at
Stockton with our existing Denniston Plateau assets will unlock
material synergies for our business. The purchase of the Sullivan
coal mining licence (and some associated land) which is located
between the Coalbrookdale and Whareatea West permits was a
further step taken during the year to enhance the Denniston
integrated mine plan. There is spend budgeted in FY19 for a
feasibility study project.
We drilled several holes in Escarpment during the year to better
understand the coal quality, which forms part of a wider
Denniston Plateau integration project.
Exploration during the year was focused on meeting short-term
operational planning and permit requirements, with a focus on:
• Completion of an updated exploration plan for the Denniston
Plateau which incorporates both Bathurst and BT Mining
permits, with access arrangements and resource consents
lodged for drilling programmes.
• Preliminary geological model and optimisations for Albury
exploration permit (Canterbury).
• Pre-feasibility study at New Brighton (Takitimu).
• Coal quality management at Canterbury and Takitimu.
• Update of grade estimation and new modelling for Takitimu.
A summer exploration programme also kicked off in April 2018
on NWP’s Crown Mountain Coking Coal Project, in which
Bathurst has an eight percent stake. The programme will run
through to October 2018 and includes:
• Finalisation of notice work application.
• Finalisation of exploration budgets and project plan.
• Geotechnical drilling for the purposes of pit design.
• Geochemical and soil sampling programme.
• Geological infill drilling for structural and coal quality.
Financial results
We are pleased to report Bathurst’s strongest financial results
since the business was incorporated in 2007.
The impact of the acquisition of the new mine sites via BT
Mining cannot be overstated, with these new business streams
contributing 95 percent of Bathurst’s $45.0 million operating
profit for the year, and 85 percent of consolidated* EBITDA**
from operating segments of $106.8 million (excluding corporate).
It is worth noting that Bathurst’s existing SID business also
performed well, recording a 15 percent increase in revenue after
a drop in FY17 from the decision to place the Cascade and
Escarpment mines into care and maintenance in FY16.
While our consolidated cash balance decreased $4.0 million,
$52.7 million was spent on the acquisition of assets (property,
plant and equipment, mining properties and licences), $11.6
million of taxation was remitted, and BT Mining repaid all its
shareholder loans and external debt.
* Bathurst at 100 percent and BT Mining at 65 percent equity share
** Earnings before net finance costs (including interest), tax, depreciation,
amortisation, impairment, fair value movement on deferred consideration, and fair
value movement on derivatives and borrowings
Section 1: Year in review
13
Underlying profit reconciled to consolidated EBITDA
Underlying profit after tax
Add back
Transaction costs on JV acquisitions & legal fees on LMCH related court proceedings
Finance costs on debt instruments
Fair value movement on derivatives
Fair value movement on borrowings
Statutory profit/(loss) after tax
Add back
BT Mining (profit)/loss share
Depreciation and amortisation
Impairment
Net finance costs
Fair value movement on derivatives
Fair value movement on borrowings
Fair value movement on deferred consideration
EBITDA
Plus: 65% share of BT Mining EBITDA
Consolidated EBITDA
2018
$000
43,418
(2,353)
(3,396)
(27,687)
(4,434)
5,548
(42,961)
4,885
1,630
7,338
27,687
4,434
(102)
8,459
85,274
93,733
2017
$000
1,132
(1,304)
(2,965)
(12,530)
-
(15,667)
775
10,632
-
3,449
12,530
-
(1,749)
9,970
-
9,970
14 Bathurst Resources Limited Annual Report 2018
Section 1: Year in review
15
Our commitment
Sustainability context
The wider picture
Our ethos
Sustainable development and responsible resource use are
fundamental to all that we do, spanning across all phases of
our business from exploration to mine closure. This means that
every day we are guided by a commitment to provide positive
outcomes for our employees, shareholders, local communities,
and importantly the environment.
We recognise that resource extraction can be a complicated
and controversial business, and we know that our work will have
an impact on the environment. But it’s how we respond that
matters - it’s our job to operate in the safest and most
respectful way possible.
“
We’re committed to sustainable
development where economic
growth is coupled with
respect for conservation
and community values
As society moves towards meeting the goals of the Paris
Agreement, it is vitally important that we align environmental
objectives with the universal goals of access to energy, security
of energy supply, and social and economic development.
Coking coal is an internationally strategic mineral, as there is
currently no viable alternative for coking coal in the production
of steel. Steel delivers the goods and services that our societies
need – healthcare, telecommunications, improved agricultural
practices, better transport networks, clean water, and access
to reliable and affordable energy including renewable energy
infrastructure. Our Stockton and Denniston coking coal
resources are well known for their excellent quality. With low
ash and high fluidity, these coals are highly sought after by
international steelmakers.
Our high quality, thermal-grade coal is used to help drive the
engines of many iconic New Zealand food businesses. We
acknowledge that coal is a transitional energy fuel, and we are
committed to being part of the conversation regarding the
reduction of energy coal use. While we understand a move away
from energy coal is part of the future, we wish to see a just
transition to allow a suitable timeframe for customers to transfer
to other viable energy sources. This recognises that businesses
need reliable and affordable energy in order to continue to
positively contribute to their employees, their communities and
the wider New Zealand economy.
And while these conversations are ongoing, we understand
and accept the challenge of responsible mineral extraction
and reliable supply required. We will continue to manage our
extraction of this finite resource in a safe and sustainable
manner, taking actions to reduce our operational emissions
and minimise our environmental footprint.
16 Bathurst Resources Limited Annual Report 2018
Purpose of this supplement
This sustainability supplement is to provide introductory
information on our sustainability performance as part of our
annual report. The supplement includes information on all
Bathurst owned and operated sites including the three operating
mines acquired via BT Mining (Stockton, Rotowaro and
Maramarua). The process of integrating performance systems
and standardising data is ongoing post acquisition and will
underpin future sustainability reporting.
In producing this content, the Global Reporting Initiative (“GRI”)
has been used as a guiding framework; however, we make no
claim that this supplement has been prepared in accordance
with the GRI. Note that the content and numbers represented
in this supplement have not been externally audited.
Site risk registers and public commentary on Bathurst over
the past 12 months were also considered in our selection of
the material issues. For next year’s reporting, our Company is
committed to expanding this process of engagement to better
identify and prioritise sustainability issues to include what
matters most to our external stakeholders.
Through this we identified a range of material issues which
were grouped based on importance to Bathurst and the
perceived interest to stakeholders. The topics of interest
to both our Company and its stakeholders are considered
significant material issues that our Company intends to address
in our business strategy and sustainability performance and
reporting. Where possible, general disclosures and management
approaches to material topics are informed by GRI guidance
and information is provided for one or more disclosures for
most material topics.
How we determined our material topics
to be covered
The content of this sustainability supplement is informed by
the materiality assessment process carried out by Bathurst.
For this year’s report, the process has had an internal focus
to consolidate and build on the knowledge of our increased
staff perspectives as a result of the joint venture acquisitions.
The process involved an analysis of materiality assessment
approaches in the mining sector, from a company, industry
and investor perspective. This analysis was used as a basis
for internal discussions with our managers responsible for
stakeholder engagement, to determine our most important
economic, social and environmental impacts and
contributions our business has.
Section 1: Year in review
17
Material topics
SOCIO-ECONOMIC
Stakeholder engagement
Engagement with stakeholders is critical
for the continued success of our
Company and licence to operate now and
into the future.
SOCIO-ECONOMIC
Economic performance
and responsibility
Our focus is to responsibly manage
the key processes within our control
– financial oversight, productivity
improvements and cash costs of
production.
HEALTH AND SAFETY
Health and safety
Our operations are focused on our
people, their safety and wellbeing
while mitigating operational risks
and maintaining productivity.
ENVIRONMENT
Water management
ENVIRONMENT
Land use and biodiversity
ENVIRONMENT
Energy and emissions
We aim to manage our water inputs, use
and outputs to inform our management
of water related risks, seeking to minimise
the impact to other water users and the
environment.
We strive to avoid and minimise any
significant impacts our operations may
have on sensitive species, habitats and
ecosystems. We integrate biodiversity
into our business decision-making and
management activities.
We continue to find new ways to use
energy more efficiently in our operations.
As our assets have grown in size,
complexity and diversity, we recognise
that energy efficiency could be measured
better and ultimately improved.
GOVERNANCE
Compliance
Compliance in the mining sector
represents a significant risk to our
business. We are continually focused
on achieving positive and compliant
performance outcomes.
GOVERNANCE
Mine closure plans
We aim to manage closure focusing
on supporting the economic and social
transition after mining ends, establishing
a self-sustaining ecosystem and
opportunities for a range of
potential post-mining land uses.
FY19 sustainability objectives
The objective in FY19 is to establish the site and corporate
reporting tools to ensure that the relevant information is
collected to enable GRI compliant reporting on the material
topics noted previously and general disclosures in the next
annual report. In addition, we have set the following
sustainability objectives for FY19:
Health
Implement a revised health assessment and
monitoring programme for a healthy workforce
Safety
Increase the use of risk management tools
across the business
HSEC management system
Implement a pro-active culture of reporting
on HSEC issues by defining field leadership
key indicators
Water management
Produce updated active water balance models
for all sites
Mine closure
Produce up to date mine closure plans for
all sites
Environmental incidents
No uncontrolled spills or discharge to the offsite environment
Biodiversity
Prepare biodiversity action plans for all sites
Community
Update stakeholder engagement plans
ENVIRONMENT
Overburden management
Managing overburden materials to create
stable landforms for rehabilitation is a key
focus when developing our mine plans. This
includes focus on implementing controls
such as characterising mineral wastes and
managing site storage to limit environmental
effects and minimise closure costs.
GOVERNANCE
Emergency preparedness
We maintain emergency management
plans to identify the potential for
emergency situations and to test
our capability to respond.
18 Bathurst Resources Limited Annual Report 2018
Section 1: Year in review
19
Summary of FY18 performance on sustainability
Stakeholder engagement
Bathurst has a stakeholder engagement framework that defines stakeholder groups and methods of engagement. Some stakeholder
groups are statutory and some are identified at a corporate level, while others are identified by our individual operations. Our primary
stakeholder groups are shown below with an outline of the key engagement aspects for each group.
Whereas Bathurst is engaging with stakeholders on a regular basis to understand their needs and perspectives, the development of
this sustainability report supplement has not involved external stakeholder consultations. We aim to conduct specific stakeholder
engagement in the development of next year’s sustainability report.
Our stakeholders
Our workforce
Our employees and contractors,
many of whom live in neighbouring
towns to our operations
Local communities
Our operations and our people are part
of local communities; we take our role as
responsible community members seriously
Industry associations
We are represented on a number
of industry associations
Unions
We engage with union representatives
representing workers’ interests
Government
To ensure we understand and meet
government expectations, we regularly
consult with a wide range of central
and local government authorities
Investors
Delivery of cash flows to maintain a
strong balance sheet managed by
strong governance
Customers
We work with our domestic
and export customers to provide a
safe, reliable and consistent supply
that meets their product needs
Non-governmental organisations
We believe through NGO engagement
we can achieve common goals and
improve the quality of life in the
communities where we work
Iwi
We engage with iwi to understand
their interests in the cultural and
environmental effects of our business
Suppliers
We source a range of goods and
services to sustain our operations
20 Bathurst Resources Limited Annual Report 2018
91%
of our employees live locally
to mining operations
$40.5m
paid on employee benefits
$39.4m
paid in taxes and royalty
payments to government
$221.6m
contributed to the
NZ economy
Financial figures noted above are Bathurst and 100 percent of BT Mining
Economic performance and responsibility
Bathurst’s operations contribute to the economic development
and wealth of host communities through a number of channels,
including wages and salaries paid to employees and contractors,
taxes, royalties and fees to governments, local procurement of
goods and services and support of community programmes.
Community investment
Our relationship with the communities where we operate is
important to the future success of its operations. We are
committed to operating in a socially responsible manner.
Over the past year, we have contributed $37,948 to the following
organisations: Life Education Trust West Coast, Cape Fear Youth
Adventure Race, Hororata Night Glow Festival, Buller High
School University Scholarships, Ohai Nightcaps Rugby Club,
Mount Linton Muster, Sky Tower Challenge, Nightcap Bowls
Club, West Coast Scooter Derby, Ohai-Nightcaps Lions Club,
Nightcaps Squash Club, Ohai Nightcaps Fire Brigade, Buller
Gorge Country Music Festival, Buller Bay Fishing Competition,
Tasman Surf Team, Haroko School Hockey, The Going Bananas
Show West Coast, and New Zealand Mines Rescue Trust. We also
provided in kind seedlings to the Carters Beach Domain Board
for beach stabilisation works.
In FY19 we plan to complete a review of our sponsorship
programme to focus our sponsorship on enduring community
projects.
We also contribute to the professional development of mining
professionals through key conference sponsorships through the
New Zealand Minerals Forum and the New Zealand Branch of
Australasian Institute of Mining and Metallurgy.
Rehabilitation funds
We are committed to environmental protection and ensuring
responsible mine closures. As at 30 June 2018, we had access
to over $66 million in a number of rehabilitation funds that will
be used to fund mine closure rehabilitation at our mine sites.
Closing a mine can have significant impact on local communities.
We endeavour to work with external stakeholders while
reviewing and updating closure plans regularly over the life
of the mine, considering post-mining land uses that have
potential benefits to the local communities.
Section 1: Year in review 21
Significant effort in FY18 was focused on the health and
safety transition plan for our new mines. Risk management
was a key focus, addressed via 38 days of principal hazard risk
assessments and updating the site management plans. Another
area of emphasis was the review of management system
elements, including site training systems, worker engagement
practices, change management and document control.
We strive to reduce risks as far as is practicable. Two levels of
risk management training were completed across all operating
sites to support the risk management improvement focus.
Health and safety
We are working hard to encourage a committed health and
safety mindset in all of our workforce, and to enable supporting
behaviours, cultures and processes are in place across every
area of our operations. We work to ensure mine workers are alert
to their own safety, focus on their fitness for work, care about
the safety of their colleagues and look out for any potential
safety risks in our operations, however small. We need to
continue to ensure our sites operate in a safe manner,
particularly by improving our safety behaviour and enabling
employees to quickly report incidents or potential incidents.
We are disappointed to report that there was one lost time injury
during FY18. The injury occurred at Huntly West mine in April
during a historical infrastructure demolition task and constituted
minor lacerations to head and shoulder and a soft tissue
shoulder injury. We will endeavour to continue to work with our
contractors to ensure they understand our safety requirements
and help them build skills and expertise to improve their safety
performance where needed.
As part of the transition in bringing the three new mines into the
Bathurst Group in FY18, we have completed a review of health
monitoring across our operations. We engaged an occupational
medicine physician to assist us with this review where it was
determined that there was room for improvement. A revised
programme of occupational health monitoring and exposure
monitoring will be rolled out in FY19.
22 Bathurst Resources Limited Annual Report 2018
CASE STUDY
A systems approach to safety by applying
a focus on training and competency
Achieving zero harm is a huge challenge, especially for a
company who was preparing to bring three new operations
into the business.
The first step was to gain a good understanding of the
situations that lead to accidents in our industry and the
systems and processes which form the building blocks of a
safe work environment.
The Safe Work Model (or Nertney Wheel) was developed in 1976
by Bob Nertney. The Safe Work Model is a practical model based
on the knowledge that production and profit are the primary
goals of an operation, but it must be done in a way to keep our
people safe. To achieve Safe Productivity there are three key
components which an organisation must provide for:
• Competent People
• Fit for Purpose Equipment
• Safe Work Practices.
We were committed to ensuring that we understood any
potential health and safety risks during the due diligence
process and any measures taken would be applied across all
current and new operations. A major focus has been on the
training and competency of our people. We need to provide
suitable and adequate information, training and instruction
to our workers by ensuring that they have the required skills
and knowledge to carry out a task. But first we needed to
understand what we needed to do.
Commencing in mid-2017, training compliance audits were
conducted across all our mining operations and the findings
incorporated into an improvement plan.
o
n t r
C o
l l e d Work Environm
ent
o m p e tent People
C
Safe
Productivity
t
n
e
m
p
i
u
q
E
e
s
o
p
r
u
Fit for P
e
s
S
a
f
e
W
ork Practic
Competent People Element of the Safe Work Model
The audit criteria included validation of the established
processes at the existing and new sites, as compared to
New Zealand legislative requirements, and the establishment
of an implementation plan for the identified improvement
opportunities.
In light of the results a prioritised list of actions to address
the most important issues was developed as follows:
• Revision of all Certificate of Competence (CoC) holder files.
• Development of an entry level Risk Management and
Health and Safety Management Systems knowledge unit,
now colloquially known as BRL1.
• Develop operator equipment assessment documents mapped
to the NZQA or Australian RII unit competency standards
where no equivalent New Zealand standards existed.
• Train all BRL personnel conducting training or assessment
in NZQA4098 Assessor and NZQA7108 Trainer competency
standards.
• Implement the BRL Training Standard across all operations.
• Develop induction packages for all operations which deliver
a consistent approach to all employees and contractors
joining Bathurst.
• Develop Supervisors’, Superintendents, Managers and
Health and Safety Representatives skills in accident
investigation techniques based on the multi causation
investigation framework used by Bathurst.
Fast forward one year and the ambitious implementation
plan is well advanced:
• Concentrated training programmes for the delivery of the
BRL1 training have resulted in the majority of all employees
and contractors across all operations being competent in
these units. Evidence would suggest a good understanding
of the Bathurst risk management tools and their application
has been achieved.
• All Trainers and Assessors have completed the appropriate
unit standards ensuring that the delivery of training in
equipment competencies happens in a consistent manner
in accordance with the BRL Training Standard.
• CoC candidates and Supervisory positions such as B-Grade
Managers, A-Grade Managers and Site Senior Executives
(SSE) have access to customised units which include
Bathurst systems and processes.
• Supervisor development programmes have been established.
• Site health, safety and environment inductions have been
updated across all operations.
Section 1: Year in review 23
Environmental material aspects
Water use intensity
Based on estimates of water use, the water use intensity
(measured as cubic metres of water used per tonne
of coal produced) is shown below. The Takitimu mine is in close
proximity to the Nightcaps village, thus the site has an intensive
dust suppression programme which leads to its relatively high
water use intensity compared to other sites.
Water use intensity FY18
(litres water used/tonne coal produced)
d
e
c
u
d
o
r
p
l
a
o
c
f
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e
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/
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t
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L
800
700
600
500
400
300
200
100
0
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t
k
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i
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i
k
a
T
Water management
We operate a water management planning process that allows
us to operate within legislation and minimise conflict with other
water users and associated ecosystems. Our operations are
generally located in areas where water is relatively abundant;
hence our key focus is on treating water discharge. In FY19
we will be implementing water balance quantification studies
at all our sites in order to understand how we can maximise
water recycling, minimise water use and optimise water
discharge quality.
No water sources have been significantly affected by water
depletion and adverse impacts by water use at our sites. Overall
water use was 852 Ml in FY18.
Discharges from our Stockton mine site are being carefully
managed to treat acid mine drainage. In FY18 over 7,500 tonnes
of acidic mine drainage was actively treated using calcium oxide
to neutralise the acid in the Mangatini stream catchment at
Stockton mine site. This ongoing active treatment has led to
recovery of migratory fish in the downstream Ngakawau River.
Operational site*
FY18 water use (Ml/yr)
Stockton
Rotowaro
Maramarua
Canterbury
Takitimu
Corporate
TOTAL
319
278
42
25
186
2
852
* Excludes care and maintenance mines Escarpment, Cascade and Sullivan
24 Bathurst Resources Limited Annual Report 2018
CASE STUDY
Enhancing indigenous fish migration in
the Ngakawau River, Stockton mine,
Stockton Plateau
We are working with local and international acid mine drainage
treatment experts to continue the progressive treatment of
historical and current acid mine drainage on the Stockton
Plateau and to ensure that the aquatic ecology health of the
Ngakawau River continues to improve.
In the Stockton mine catchments, coal mining has taken place
for over 130 years. In that time hundreds of millions of tonnes
of acid producing Brunner Coal Measures waste rock has been
disturbed by underground and open cast mining. In the high
rainfall environment of > 5 metres annual mean rainfall, this has
resulted in a legacy of over 10,000 tonnes of acid mine drainage
entering the Ngakawau River annually from historical workings
and had a detrimental impact on the habitat and aquatic
ecological health of whitebait.
The Ngakawau River is an important river for recreational
whitebait fishing. Whitebait is the common name
for five indigenous species of migratory Galaxiid fish that are
allowed to be fished during the period 1 September to
14 November. Galaxiids breed in autumn and then the larvae
float out to sea, where they live and grow over winter, migrating
back upstream as juvenile whitebait in spring.
Juvenile Galaxiids (Whitebait) (so called because of the patterns of their skin which
look like a galaxy of stars)
In the last financial year, Stockton mine has neutralised over
7,500 tonnes of acidic mine water by dosing with over 4,500
tonnes of calcium oxide in an active water treatment and
associated settling sump of capacity 900,000 m3 in the
Mangatini catchment at Stockton. Approximately 98 percent of
the 7,500 tonnes of acid treated in FY18 was historically
generated acid from rock disturbed pre-September 2017.
In FY18, the site constructed engineered caps of weathered
granite and cement kiln dust over 20 hectares of acid producing
Brunner Coal Measures waste rock engineered landforms.
These caps are designed to have a permeability of < 1 x 10-6 m/s
which minimises oxygen and water ingress into the engineered
landforms. In addition, the cement kiln dust provides a source
of alkalinity. The cement kiln dust is a waste product from a
local cement works and recycling this highly alkaline waste
product in the acidic mine environment provides a positive
environmental outcome.
Stockton mine has water quality consent criteria and objectives
in the Ngakawau River that need to be met to protect migratory
whitebait health. A key consent criterion is to ensure Ngakawau
River pH is always greater than 4 and a key objective is to
minimise the time period when dissolved Aluminium is > 1 mg/l.
In the last financial year pH was > 4 at all times and dissolved
Aluminium was < 1 mg/l for 85 percent of the time based on
daily samples.
The result of this project agreed with Stockton Community
Consultative Group (which includes Iwi, Department of
Conservation, Ngakawau River Watch, Regional and District
Councils, and community members) was the quantifiable
successful migration of indigenous juvenile fish past the mine
site discharges and into the headwaters of the Ngakawau River.
Stockton mine commissioned an independent electric fish
survey in December 2017 in Ngakawau River headwaters
upstream of the mine. Results indicated that juvenile whitebait
and eels had migrated beyond the minewater discharges to the
headwaters. This indicates that efforts by Stockton mine to
improve water quality is facilitating the return of whitebait and
eels to the headwaters of Ngakawau River.
Another headwater fish survey will be undertaken in December
2018 to ensure that Stockton mine’s acid mine drainage
management and treatment systems are continuing to have
positive impacts for the Ngakawau River aquatic ecology.
Section 1: Year in review 25
Land use and biodiversity
Land disturbed at end of FY18 and land rehabilitated in FY18
Biodiversity and other related ecosystem services represent the
infrastructure on which our people and economy depend. We are
working with experts and local stakeholders to put in place
suitable solutions for biodiversity outcomes, and we will report
on these next year.
Our goal is to minimise our footprint and progressively restore
disturbed land to meet closure criteria in the shortest time
possible. Our approach is to avoid, minimise, mitigate and
offset the impacts of our operations.
This is achieved through focused mine planning, to ensure the
disturbed footprint is minimised and soil is treated as a valuable
commodity. A series of rehabilitation management plans are
actioned during operations to mitigate effects and/or restore the
habitat to a land use condition of similar values to pre-mining.
Overall, net land disturbance in FY18 reduced by 31 hectares.
The Stockton mine has 55 percent of the total disturbed area of
1,542 hectares. Stockton’s previous operator had over 15 active
coal winning areas open simultaneously and this precluded
progressive rehabilitation. The revised Stockton mine plan under
our management includes reducing the active coal winning areas
and establishing a more progressive strip mining operation in
the Millerton pit area. This will aim for progressive rehabilitation
to increase to a rate approximately double the current rate of
25 hectares per year.
26 Bathurst Resources Limited Annual Report 2018
900
800
700
600
500
400
300
200
100
0
)
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Disturbed land
Land rehabilitated FY18
Excludes land rehabilitated completed at sites prior to FY18
CASE STUDY
Lizard salvage and monitoring
– Escarpment mine, Denniston Plateau
The 1,750 hectare Denniston Plateau is Crown land administered
by the Department of Conservation (DOC) and is notable for
the diverse and unique biodiversity including the mix of lizard
species found there. Through the consenting process for the
Escarpment mine which is located on the Denniston Plateau,
Bathurst worked with DOC to develop and implement a lizard
management plan. This plan identifies a range of commitments
to avoid, remedy and mitigate the adverse effects of mining
activities on the lizard populations, and to offset and enhance
populations across the wider Plateau.
Research and monitoring are key components to determining
and adaptively refining management effectiveness and
efficiencies. The key objectives of the monitoring and research
programme are to:
• Add to baseline information and improve the general
understanding of lizard species, and their relative abundances
within the mine site and the wider Denniston Plateau.
Originally three species (two gecko and one skink) were
known to occur there; the survey work has uncovered a
further species that was thought may have been present, but
had not been found (Nelson green gecko).
• Assess the effects of animal pest control on lizards,
particularly within the 700ha Denniston Permanent Protection
Area (DPPA). This is an area set aside for protection and
enhancement as an offset for the adverse effects within the
mine site. One of the consent conditions requires a sustained
improvement in abundance of two of the lizard species in
the DPPA.
• Determine the suitability of the rehabilitated mine site
for lizards.
• Determine the efficacy of salvage and translocation as a tool
to mitigate effects and, wherever possible, to enhance survival
rates of relocated animals.
Prior to commencing earthworks in any area, searches were
required to be undertaken and any lizards found translocated
to a suitable location within the DPPA. Initially concerns were
raised about the chances of survival for translocated individuals,
as there were many unanswered questions around preferred
habitat, competition, and predation. To respond to some of these
questions, all lizards beyond a certain size were temporarily
fitted with radio transmitters so that survival and habitat
preferences could be determined. A corresponding population
of lizards in the relocation area was monitored using transmitters
as a control.
Typical transmitter/harness setup on a forest gecko
Radio tracking results suggest that, at least in the short-term,
salvage and relocation efforts are successful. Species
survivorship is high and animals exhibit site fidelity (i.e. remain
in the area in which they were released). Body condition (weight)
generally declined, however, this may have been attributed to
the radio tracking as the body weight of resident geckos also
declined. While results appear successful in the short term,
further work including increasing the sample size is required
to determine if salvaged geckos will survive in the long term.
The radio tracking study results indicate that all three gecko
species use the full range of broad habitat types available on
the Denniston Plateau (i.e. sandstone pavement/prostrate
vegetation, shrubland and forest). Prior to this study, forest
and West Coast green geckos have predominantly been found
in prostrate vegetation and to our knowledge have not been
found in forested habitats. The wider range of available habitat
indicates that the gecko populations are likely to be larger
and more widespread than first thought.
Salvage and search efficiencies have been significantly
improved, predominantly because of the amount of time spent
searching and through the information gleaned from the radio
tracking results.
While the site is in care and maintenance no further work is
planned, however prior to recommencement, further research
and translocation will be completed. This will enable establishing
a sufficient data-set for statistically robust analysis to be
applied. Habitat characterisation surveys are also planned for
before the mine recommences operations, and this will assist
with detailed design of the rehabilitated landform.
DOC undertakes a programme of weed and pest control across
the Denniston Plateau funded by compensation money paid by
Bathurst. There is an ongoing close working relationship with
DOC to ensure that maximum benefits can be obtained for
biodiversity in the area, including determining how to best
measure the benefits of weed and predator control for the
lizard populations.
Section 1: Year in review 27
Energy and emissions
Energy use
In FY18 our energy consumption remained one of our largest
operational inputs. A project has been initiated to improve
energy management, looking to become more efficient and
consequently reduce the energy intensity of our operations.
Our total energy consumption is reported in terms of energy
consumed (fuel and electricity) by staff and contractors. A total
energy use of 768,294 GJ was used at our five operational sites
and corporate offices in FY18.
93 percent of the energy consumed within Bathurst sites
included fuel used for onsite transport, operations and power (at
Canterbury mine site). The remaining seven percent of energy
consumed was purchased electricity.
When comparing energy consumption by operation, there are
significant differences which can be accounted for by the scale
of the operation and the mine life cycle stage. Stockton mine
is the largest consumer of energy with 276,152 GJ which is
consistent with producing the most coal of the five sites and
reflects the electricity used in the Stockton coal preparation and
handling plant. Rotowaro is the second largest consumer with
265,977 GJ which reflects the fact that Rotowaro mine moved
almost seven million bcm of waste rock in FY18, which reflects
increased stripping ratios in this mature mine.
Greenhouse gas emissions
We participate in the Emissions Trading Scheme (“ETS”) where
pricing of ETS units is passed on to our customers as part of the
product supply. We will continue to work with our customers
around our participation in the ETS assisting them through focus
on the quality of energy supplied and efficient logistic pathways.
Our mining projects use significant quantities of diesel fuel to
perform open pit operations including the onsite transportation
of our coal and coal extraction. Electricity consumption is also
essential for our coal processing, water treatment plants and
mine management systems. We report our GHG emissions
with reference to their source as follows:
GHG emissions type
GHG emission source
Direct (Scope 1)
Fuel consumed on-site by
BRL and contractors for core
business activities and in
corporate offices; fugitive
emissions from production
coal for FY18.
Energy Indirect (Scope 2)
Purchased electricity consumed
on-site and in corporate offices.
Reference: Ministry for the Environment National GHG Inventory 1990-2015
In addition, our coal produced releases GHGs (fugitive
emissions) and these are also accounted for in the FY18
production in Scope 1 emissions.
During FY18, we have improved the data acquisition and
record system for greenhouse gas (“GHG”) emissions from
our operations, including corporate offices.
For this first year of reporting, we are aligning with the GRI
reporting requirements in terms of Scope 1 and 2 emissions.
In accordance with GRI, we have included carbon dioxide in
our GHG emissions calculations, reported as carbon dioxide
equivalents (CO2e) with the intention of extending the scope
of gases included in future reports.
Consumption of electrical power related GHG emissions for
our operations is relatively low compared with GHG emissions
from diesel use. Our coal is low ash and high quality, reducing
the level of coal processing required. In addition, the GHG
emission factor can significantly affect the level of emissions.
The New Zealand grid has a significant percentage of renewable
energy sources in its supply and a resultant lower CO2 emission
factor (Reference: ETS Climate Change (Stationary Energy and
Industrial Processes) Regulations 2009 (part 2 Section 9)).
The total GHG emissions for Scope 1 and 2 for FY18 are 98,102
tonnes CO2e. 47 percent related to fugitive emissions of
production coal, approximately two percent related to electricity
and the bulk of the remaining 51 percent related to fuel
consumption. Note all emissions and power use reported are
only ten months from date of acquisition in FY18 for Stockton,
Rotowaro and Maramarua mines.
Comparison of energy consumption by operation FY18
)
J
G
(
n
o
i
t
p
m
u
s
n
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g
r
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n
E
300,000
250,000
200,000
150,000
100,000
50,000
0
n
o
t
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S
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t
a
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o
p
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C
Electricity
Fuel
Excludes Escarpment, Cascade and Sullivan mines where consumption was
zero for FY18
28 Bathurst Resources Limited Annual Report 2018
Scope 1 and Scope 2 emissions by operation FY18
Overburden management
Site
Stockton
Rotowaro
Maramarua
Canterbury
Takitimu
Corporate
Total
Scope 1
emissions
(t/CO 2)
36,771
33,396
7,354
8,839
10,040
15
96,415
Scope 2
emissions
(t/CO 2)
1,078
435
131
0
38
5
1,687
In FY18, the highest GHG emissions intensity were at the
Canterbury and Maramarua mines. Intensity is high at
Canterbury mine due to electricity supply at this site being
from diesel generators as it is off grid. Maramarua mine has
a relatively higher emissions intensity due to the site being
in a development stage resulting in reduced coal outputs.
GHG emissions intensity FY18
(tonnes CO2e/tonne coal produced)
l
a
o
c
e
n
n
o
t
/
e
2
O
C
s
e
n
n
o
T
0.08
0.07
0.06
0.05
0.04
0.03
0.02
0.01
0
Scope 1 and 2
n
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t
n
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C
u
m
i
t
i
k
a
T
During FY18, the two sites that currently produce potential acid
producing waste rock are Stockton and Canterbury.
Overburden (bcm) disturbed in FY18
8,000,000
7,000,000
6,000,000
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
0
)
m
c
b
(
d
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s
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i
t
i
k
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T
NAF1
PAF2
1 NAF – Non-acid forming overburden
2 PAF – Potentially acid forming overburden
Site
Stockton
Rotowaro
Maramarua
Canterbury
Takitimu
Total
NAF
PAF
393,308
3,059,228
6,984,000
1,739,000
1,139,000
2,084,213
0
0
118,000
0
12,339,521
3,177,228
Stockton mine is adopting some of the successful overburden
dump construction techniques used at the Barren Valley
Engineered Landform at Escarpment mine to minimise acid
production. Escarpment mine (on care and maintenance) has
installed a mussel bed bioreactor to test passive treatment
options for closure of overburden storage areas.
We are funding a research project to assess the neutralising
agents currently used to treat acid mine drainage at Stockton
mine to provide an optimal neutralising solution that includes
minimising the carbon footprint of acid management.
Canterbury mine uses two mussel bed bioreactors to
successfully passively treat five tonnes of acid/year.
Section 1: Year in review 29
Governance
Environmental compliance
Throughout our mines’ life cycle, we focus on meeting or
surpassing environmental regulatory requirements and
managing our most material impacts: air emissions, water quality,
water consumption, energy use, waste, biodiversity and land use.
Our corporate environmental governance is based on
international standards for environmental management.
Our Environmental Policy and supporting management system
applies equally to all employees and contractors. The Bathurst
HSEC Management System applies throughout the full mining
cycle from exploration to closure and aftercare phases.
Complaints pertaining to environmental issues are recorded via
complaints registers that are maintained at all sites. Complaints
are investigated via an internal incident investigation system and
are only closed off when resolved.
As previously reported, two sets of infringement notices were
issued by the regional council (Environment Canterbury) in
October and November 2017 in relation to non compliances with
conditions of a water permit. Further a water discharge occurred
at the Canterbury mine on 11 January 2018. The regional council
(Environment Canterbury) laid charges in respect of this
incident in July 2018. Bathurst made an application to be
placed in the council’s alternative environmental justice
system and this has been accepted.
We have identified the contributing factors that led to these
incidents occurring and understand that our overall performance
was not good enough. All operations have updated their
environment and community broad brush risk assessments
and are now working to action their identified risk control
improvements, so this incident is not repeated at any site.
Mine closure plans
Mine closure risk assessments and mine closure workshops
with site personnel have been undertaken at all sites in FY18.
High level risks and action plans have been distilled to allow
comprehensive mine closure plans to be prepared in FY19.
These plans will be developed in FY19 based on a new company
mine closure standard. Consultation will occur with external
stakeholders to ensure post-mining land uses for mining affected
areas provide optimal benefit for stakeholders. Amounts have
been accrued in the Company’s financial statements to provide
for mine closure obligations. Future remediation costs for mines
(active and inactive) are estimated and updated every six
months and include ongoing care, maintenance and
monitoring costs.
Emergency preparedness management
We are committed to achieving operational excellence in all
aspects of our activities. This is achieved through ensuring we
have effective systems, well designed operations, qualified and
experienced staff, effective risk identification processes, and
robust operating and safety procedures. However, we recognise
that there is always a residual risk of an adverse event occurring.
We have developed a crisis management plan in order to
mitigate the impacts of any significant adverse event on the
public, our employees and the environment. The crisis
management plan is integrated with site emergency response
plans which are maintained and regularly tested at our mine
sites.
We have worked with New Zealand Mines Rescue Service to
develop training programmes to test our emergency response
across all operations in the event of different types of
emergencies. The training programme is risk based, identifying
skills required to manage scenarios for each individual site’s
specific principal hazards.
In the past 12 months, the Takitimu mine has been preparing to
mine into an area of historical underground workings. A new
emergency rescue team has been initiated at Takitimu mine who
are developing and testing void management skills such as rope
rescue, gas monitoring and compressed air breathing apparatus.
30 Bathurst Resources Limited Annual Report 2018
Section 1: Year in review 31
Our people
Board of Directors
Toko Kapea BA, LLB
Non-executive Chairman
Board Committees
Chairman of the Audit and Risk committee
Chairman of the Remuneration and Nomination committee
Experience and expertise
Toko is a Wellington-based commercial lawyer, consultant and
director at Tuia Group Limited. He has worked at Chapman Tripp
and in legal roles in-house at Meridian Energy, Bank of New
Zealand, St. George Bank NZ and ANZ. He is currently a director
on the TVNZ board.
Toko was on the Government Review Panel relating to the
Te Ture Whenua Māori Act 1993 (Māori Land Act) and was also
the lead negotiator for Ngāti Apa ki Rangitikei (North Island) for
its direct negotiation Treaty of Waitangi claims with the Crown.
Richard Tacon
Executive Director and Chief Executive Officer
Board Committees
Member of the Health, Safety, Environment and Community
committee
Experience and expertise
Richard has worked in almost every role in the coal mining sector
since starting his career in the 1970s.
After studying at the Otago School of Mines in New Zealand,
Richard’s first job was at a government owned mine in
Greymouth. He moved to Australia to further his career, working
his way from undermanager to General Manager. Richard has
held senior leadership roles in the coal sector for the past
decade.
32 Bathurst Resources Limited Annual Report 2018
Richard returned to New Zealand to the position of Chief
Operating Officer with Bathurst in 2012. He was appointed Chief
Executive Officer in March 2015.
Richard holds first, second and third class coal mining
qualifications. He has spent 15 years on a rescue crew, making
him familiar with the principles and practice of mine safety. He is
an ex-secretary of the Australian Mine Managers Association
and sits on the board of the New Zealand Mines Rescue Trust.
Richard is a director of BT Mining Limited as a Bathurst
Resources representative.
Russell Middleton MBA, BBus, GAICD
Executive Director and Chief Financial Officer
Board Committees
Member of the Audit and Risk committee
Experience and expertise
Russell has almost 30 years in the mining and construction
sector with significant experience in project evaluation,
construction and development of new operations.
He has held various executive and board positions for ASX
listed resources companies over the last 15 years.
Russell has extensive experience with both large and small
enterprises including senior management roles with BHP before
working with both Shell and Anglo American in development,
construction and production of major mining operations.
Russell is a director of BT Mining Limited and NWP Coal
Canada Limited as a Bathurst Resources representative.
Peter Westerhuis MBC, BEng
Non-executive Director
Company Secretary
Board Committees
Chairman of the Health, Safety, Environment and Community
committee
Member of the Remuneration and Nomination committee
Experience and expertise
Peter is a professional engineer with post-graduate business
qualifications and more than 30 years of Australian and
international resources experience in the iron ore, gold and coal
industries, with the last ten years at CEO and MD level. He has
successfully developed and managed large mining and
processing operations including overseeing the transition from
explorer to producer.
Peter has undertaken many complex commercial negotiations
for joint ventures, capital funding, contracts, litigation, product
marketing and off-take agreements. He is particularly passionate
about health and safety, teamwork, operational effectiveness,
business improvement and project delivery.
Peter is the CEO of Batchfire Resources Pty Ltd, and owner and
operator of the Callide Mine in central Queensland. Previously
he worked for 11 years at the Ensham Joint Venture, including
four years as CEO, developing and operating large open cut and
underground coal reserves in Queensland.
Bill Lyne
Company Secretary
Bill has a wealth of experience in the role of company secretary,
for public companies ranging from stock exchange listed to
small private companies, and not-for-profit entities.
He has operated his own business, Australian Company
Secretary Service, since 1998. Providing professional, specialist
company secretarial, corporate compliance, governance and
administrative services to various clients in diverse businesses
in a wide range of industries. He is currently company secretary
of three other ASX-listed companies, including Orion Metals
Limited, and Jumbo Interactive Limited of which he is also
a director.
Bill holds a Bachelor of Commerce degree in economics from the
University of New South Wales, is a chartered accountant, and is
a Fellow of the Institute of Chartered Secretaries &
Administrators (UK) and the Governance Institute of Australia.
Section 1: Year in review 33
Our leadership team
Ian Harvey
General Manager, Export Operations
Fiona Bartier
General Manager, Health, Safety, Environment and Community
Fiona is an environmental and resource scientist who has worked
for government in research and education for industry groups,
and for a range of mining companies.
Fiona spent seven years working in mining environmental
research at The University of Queensland and the University of
New England, where she visited and worked at more than 40
mine sites across a range of commodities. She then spent a
period of time working for the Minerals Council of Australia.
Before joining Bathurst, Fiona lived for nine years in mining
communities in the Hunter Valley and western coalfields of New
South Wales, working first as a consultant, and then within the
industry on operations and projects.
A mining engineer with 30 years’ mining industry experience,
Ian has held senior management and operations leadership roles
in New Zealand and Australia in several commodities including
bauxite, iron ore and coal. Ian has a strong engineering
background with a high level of expertise in metallurgical coal
resource optimisation and mine planning and design, as well as
risk management and leadership of resource and
infrastructure projects.
Ian holds a degree in science honours (Mineral Technology) from
the University of Otago and is a member of the Australasian
Institute of Mining and Metallurgy.
Sam Johnstone
General Manager, Marketing and Logistics
Fiona holds a Bachelor of Applied Science (Resource Science)
and New Zealand Senior Site Executive competency. She joined
Bathurst in 2012 and is based in the Wellington office.
Sam brings a wealth of experience in marketing New Zealand’s
unique coal internationally to Japan, India, China, South East
Asia, US, Europe and other specialist markets.
Alison Brown
General Counsel
Alison has more than 35 years’ legal experience in private law
practices and as in-house counsel for commercial enterprises in
New Zealand and the UK.
She has specialised in mining, environmental and climate change
law and has worked for Simpson Grierson, Minter Ellison Rudd
Watts and the Ministry of Foreign Affairs and Trade, has taught
law professionals and was General Counsel for Solid Energy for
11 years.
Alison holds a Master of Laws with Honours and has been with
Bathurst since 2013.
Carmen Dunick
Manager, Human Resources
Carmen is an HR professional with over 15 years’ experience in
both the public and private sectors, having worked in all areas of
HR.
Carmen joined Bathurst in April 2017 to manage the people
transition of BT Mining, and has subsequently taken on the
overall management of the HR function across the whole
business. Prior to joining Bathurst, Carmen consulted for a
number of government agencies in Wellington and has also
spent time in the financial services sector in Melbourne.
Carmen holds a Bachelor of Social Sciences and is a member of
HRINZ. She is based in the Wellington office.
34 Bathurst Resources Limited Annual Report 2018
Prior to joining BT Mining, Sam spent over ten years with the
Solid Energy New Zealand Limited marketing team, initially
within the domestic markets team before transitioning into
export marketing in 2009. In 2013 Sam was appointed
General Manager – Marketing and Logistics, working to redefine
the company strategy while managing the domestic and export
markets through a period of consolidation, mine/market
optimisation and the sale of Solid Energy assets.
Sam holds a Postgraduate Masters in Science, majoring in
Geography from Canterbury University.
Sam is based in the Christchurch office and leads the Marketing
(Export and Domestic) and Logistics teams.
Damian Spring
General Manager, Domestic Operations
Damian is a mining engineer with over 25 years’ experience in
mining underground and open pit mines of coal, gold,
polymetallics and nickel in New Zealand, Australia, Mexico
and Argentina.
Prior to joining Bathurst, Damian operated a mining consultancy
serving clients in Australasia and the Americas, including
Bathurst. His previous roles include Chief Operating Officer for
a junior Australian mining company, Chief Mining Engineer for
a world class silver-lead deposit in Argentina and Underground
Manager in Western Australia.
Damian holds a degree in mine engineering from the University
of Auckland and is a Chartered Professional Mining Engineer of
the Australasian Institute of Mining and Metallurgy.
PLACEHOLDER
Section 1: Year in review 35
Directors’ report
Your directors present their report on the consolidated entity (“the Group”)
consisting of Bathurst Resources Limited (“Bathurst”) and the entities it controlled
at the end of or during the year ended 30 June 2018.
Directors
The following persons were directors of Bathurst Resources
Limited as at 30 June 2018.
Toko Kapea
Non-executive Chairman
Richard Tacon
Executive Director
Russell Middleton
Executive Director
Peter Westerhuis
Non-executive Director
Principal activities
During the year the principal continuing activities of the Group
consisted of:
• the production of coal in New Zealand; and
• the exploration and development of coal mining assets in
New Zealand.
Dividends
No dividend was paid or declared during the current or prior
financial year and the directors do not recommend the payment
of a dividend.
Environmental regulation
Our exploration and mining activities are subject to a range of
environmental controls which govern how we carry out our
business. These are set out below.
36 Bathurst Resources Limited Annual Report 2018
Mine development/mining activities
Mining activities are regulated by the following:
• Resource consents granted by the relevant district and
regional territorial authorities, after following the processes
set out in the Resource Management Act 1991.
• Mining licences granted originally under the Coal Mines Act
1979 and now regulated under the Crown Minerals Act 1991.
• Mining permits, issued under the Crown Minerals Act 1991 by
the Minister of Energy and Resources, required to mine
Crown coal.
• Access arrangements or profit à prendre granted by owners of
private (i.e. non-Crown owned) coal.
• Access arrangements, granted by relevant landowners and
occupiers granted under the Crown Minerals Act 1991. For
Crown-owned land managed by the Department of
Conservation, these access arrangements are granted either
by the Minister of Conservation or, for significant projects,
jointly by the Minister of Conservation and the Minister of
Energy and Resources.
• Concession agreements under the Conservation Act 1987 for
land outside a permit area but owned by the Crown and
managed by the Department of Conservation.
• Wildlife authorities, issued under the Wildlife Act 1953 granted
by the Minister of Conservation.
Controls around water and air discharges that result from mining
operations are governed by the conditions of the resource
consents that the particular mining operation is operating under.
Our mining operations are inspected on a regular basis.
Two sets of infringement notices were issued to Canterbury
mine by the Canterbury Regional Council in October and
November 2017, relating to non-compliance of conditions of
water permits. A discharge occurred at the Canterbury mine in
January 2018 and the Canterbury Regional Council laid charges
in respect of this incident. The Company applied for this matter
to be dealt with through the Council’s alternative environmental
justice processes and this has been accepted by the Council.
Other than as disclosed, to the best of the directors’ knowledge,
all mining activities have been undertaken in compliance with
the requirements of the Resource Management Act 1991, Crown
Minerals Act 1991, Conservation Act 1987 and Wildlife Act 1953.
Exploration activities
To carry out exploration, we need to hold a relevant exploration
permit (where the coal is Crown owned) or consent from the
mineral owner where the coal is privately owned, relevant
resource consents to permit exploration, access arrangements
with the relevant landowner and occupier and where wildlife is
impacted a wildlife authority.
To the best of the directors’ knowledge, all exploration activities
have been undertaken in compliance with the requirements of
the Resource Management Act 1991, Crown Minerals Act 1991,
Conservation Act 1987 and Wildlife Act 1953.
Hazardous substances
Mining activities involve the storage and use of hazardous
substances, including fuel. We must comply with the Hazardous
Substances and New Organisms Act 1996 and Health and Safety
at Work (Hazardous Substances) Regulations 2017 when
handling hazardous materials. To the best of the directors’
knowledge, no instances of non-compliance have been noted.
Emissions Trading Scheme
The New Zealand Emissions Trading Scheme came into
effect from 1 July 2010 which essentially makes us liable for
greenhouse gas emissions associated with the coal we mine and
sell in New Zealand and for the fugitive emissions of methane
associated with that mined coal. Liability is based on the type
and quantity of coal tonnes sold, with the cost of such being
passed on to customers. Bathurst’s Emissions Trading Policy
can be found on our website.
Corporate governance
Bathurst’s Corporate Governance Statement is available on the
Company’s website www: http://bathurst.co.nz/our-company/
corporate-governance/
Donations
The Company made donations totalling $37,948 to several local
groups during the year including scholarships.
Directors’ and officers’ liability insurance
The Bathurst Group and its joint ventures have arranged policies
of directors’ and officers’ liability insurance, which, together with
a deed of indemnity, seek to ensure to the extent permitted by
law that directors and officers will incur no monetary loss as a
result of actions legitimately taken by them as directors and
officers.
Other information on directors
Directors’ securities interests
Director
Mr T Kapea
Ordinary
shares
Performance
rights
1,575,909
2,000,000
Mr R Middleton
6,762,817
4,765,492
Mr P Westerhuis
1,728,636
1,500,000
Mr R Tacon
9,687,960
5,215,067
For further information on the performance rights, refer to note
25 in the Financial Statements.
The increase in ordinary shares held by directors arose from the
conversion of the Redeemable Convertible Preference Shares
that were issued in February 2017 to fund the Company’s
investment in BT Mining. These instruments were converted to
shares at the option of Bathurst on 18 September 2017.
Other current directorships of listed companies
No directors hold other current directorships in listed companies.
Former directorships of listed companies in last
three years
Russell Middleton was a non-executive director of
Tiger Resources Limited from July 2016 to October 2016.
No other directors held former directorships of listed companies
in the last three years.
Section 1: Year in review 37
Remuneration report
Role of the Remuneration and Nomination
committee
Principles used to determine the nature and
amount of remuneration
Non-executive directors’ fees
The fees and payments the Company makes to its non-executive
directors reflect the level of responsibility attributed to Board
members and the demands which are made on the directors’
time. Non-executive directors’ fees and payments are reviewed
annually by the Board. The fees paid to the chairman are
determined independently to the fees of non-executive
directors. The chairman is not present at any discussions
relating to determination of his own remuneration.
Non-executive directors’ fees are determined within an
aggregate directors’ fee pool limit, which is periodically
recommended for approval by shareholders. The maximum
currently stands at $1,000,000 per annum.
The Remuneration and Nomination committee (“R&N
committee”) is a subcommittee of the Bathurst Board of
Directors (“Board”). All its members are non-executive directors.
The R&N committee is responsible for making recommendations
to the Board on remuneration matters such as non-executive
director fees, executive remuneration for directors and other
executives, and the over-arching executive remuneration policy
and incentive scheme.
The objective of the R&N committee is to ensure that the
Company’s remuneration policies and structures are fair and
competitive, and aligned with the long-term interests of the
Company. The R&N committee draws on its own experience in
remuneration matters and also seeks advice from independent
remuneration consultants where appropriate.
There were no major changes to the remuneration framework
during the year as Bathurst focused on the BT Mining transition.
Now that the transition is complete the R&N committee will
re-evaluate the remuneration policy and framework to ensure
they are updated to reflect changes to the business and market.
The Corporate Governance section of our website provides
further information on the role of the R&N committee.
38 Bathurst Resources Limited Annual Report 2018
PLACEHOLDER
Section 1: Year in review 39
Executive remuneration
Base pay and benefits
The objective of the Group’s executive reward framework is to
ensure reward for performance is competitive and appropriate
for the results delivered. The framework aligns executive reward
with achievement of strategic objectives and the creation of
value for shareholders, and conforms to industry practice.
The R&N committee ensures that executive pay is competitive
and reasonable, as well as acceptable to shareholders. The
Company ensures that an executive’s remuneration is linked to
that executive’s performance to ensure that the interests of the
Company and its executives are aligned. The R&N committee
determines executive remuneration to ensure transparency and
to effectively manage capital.
In consultation with external remuneration consultants, the
Company has structured an executive remuneration framework
that is market competitive and complementary to the reward
strategy of the organisation.
The Company believes that the policy for determining
executives’ remuneration is aligned with shareholders’ interests
because it focuses on sustained growth in shareholder wealth by
pushing growth in share price and delivering constant return on
assets, as well as focusing the executive on key non-financial
drivers of value. Most importantly, the Company ensures that its
remuneration policy attracts and retains high calibre executives,
who in turn add value to the Company and to the shareholders.
The Company also believes that its remuneration policy for
executives is aligned with the interests of its executives. The
executive remuneration policy rewards capability and experience
and reflects competitive reward for contribution to growth in
shareholder wealth. The policy is transparent, so it provides a
clear structure for earning rewards and provides recognition
for contribution.
The framework provides a mix of fixed and variable pay, and a
blend of short- and long-term incentives. As executives gain
seniority with the Group, the balance of this mix shifts to a
higher proportion of ‘at risk’ rewards.
The executive remuneration and reward framework has
three components:
• base pay and benefits, including superannuation;
• short-term incentives; and
• long-term incentives.
40 Bathurst Resources Limited Annual Report 2018
Executives are offered a competitive base pay that comprises
the fixed component and rewards. External remuneration
consultants provide analysis and advice to ensure base pay is
set to reflect the market for a comparable role. Base pay for
executives is reviewed annually to ensure the executives’
remuneration is competitive with the market. An executive’s
remuneration is also reviewed on promotion.
There are no guaranteed base pay increases included in any
executives’ contracts.
Short-term incentives
Short-term incentives are an at-risk component of senior
executive remuneration in addition to fixed annual remuneration
and payable in cash on achievement of performance targets that
align with short- and medium-term business plans. These are
reviewed and paid annually, as recommended to the Board by
the R&N committee.
There is no guarantee that these incentives are approved or
increased annually.
Long-term incentives
Bathurst’s Long Term Incentive Plan (“LTIP”) was approved by
shareholders at the 2015 AGM. The purpose of the plan is to
reinforce a performance focused culture by providing a
long-term performance-based element to the total remuneration
packages of certain employees and non-executive directors
(in the form of performance rights) by aligning and linking the
interests of Bathurst’s leadership team and shareholders, and to
attract and retain executives and key management.
The plan forms part of the Company’s remuneration policy and
provides the Company with a mechanism for driving long-term
performance for shareholders and retention of executives.
Performance rights granted under the plan carry no dividend or
voting rights. When exercised, each performance right converts
into one fully paid ordinary share.
For further information on the performance rights, refer to note
25 in the Financial Statements.
Service agreements
On appointment to the Board, all non-executive directors enter
into a service agreement with the Company in the form of a
letter of appointment. The letter summarises the Board policies
and terms, including compensation, relevant to the office of
director.
Remuneration and other terms of employment for the managing
director and other key management personnel are also
formalised in service agreements.
Directors’ remuneration
The total remuneration and other benefits to directors for services in all capacities during the year ended 30 June 2018 was:
Director
Mr T Kapea
Mr R Middleton
Mr P Westerhuis
Mr R Tacon
Directors’ fees
Short-term benefits
Share-based payments
$120,000
$10,666
$65,078
-
$371,163
-
-
$593,115
$62,677
$189,960
$47,008
$227,903
Total
$182,677
$561,123
$112,086
$821,018
Directors’ fees were paid to Mr Middleton up to the point at which he was appointed Chief Financial Officer (“CFO”) in August 2017.
Short term benefits for both Mr Tacon and Mr Middleton are executive remuneration in their capacity as Chief Executive Officer
(“CEO”) and CFO respectively.
Employee remuneration
During the year ended 30 June 2018, 28 employees (excluding the CEO) received individual remuneration over $100,000.
Range
100,001 – 110,000
110,001 – 120,000
120,001 – 130,000
130,001 – 140,000
140,001 – 150,000
160,001 – 170,000
170,001 – 180,000
180,001 – 190,000
210,001 – 220,000
220,001 – 230,000
270,001 – 280,000
290,001 – 300,000
370,001 – 380,000
# of employees
5
3
3
3
2
2
1
1
2
1
2
2
1
The interests of the current Company officers (excluding the CEO and CFO) in securities of the Company at 30 June 2018 were nil.
Section 1: Year in review 41
42 Bathurst Resources Limited Annual Report 2018
Highest net profit after tax since incorporationNet assets increased $64.2 millionFinancial figures noted are Bathurst and 65 percent equity share of BT Mining.$195.5mRevenue$237.1m$83.7mEBITDA$93.7m$45.4mOperating cash flows$54.6m$42.3mUnderlying profit$43.4m Section 2: Financial statements 43
Financial statementsIn this sectionIncome statementStatement of comprehensive incomeBalance sheetStatement of changes in equityStatement of cash flowsNotes to the financial statementsIndependent auditor’s report02 Contents
Income statement
Statement of comprehensive income
Balance sheet
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
Additional information
Independent auditor’s report
45
46
47
48
49
50
81
84
These financial statements were authorised for issue on behalf of the Board of Directors on 27 August 2018.
Toko Kapea
Chairman
Russell Middleton
Director
44 Bathurst Resources Limited Annual Report 2018
Income Statement
For the year ended 30 June 2018
Revenue
Less: cost of sales
Gross profit
Share of equity accounted profit/(loss)
Other income
Depreciation
Administrative and other expenses
Fair value gain on deferred consideration
(Loss)/gain on disposal of fixed assets
Impairment losses
Operating profit before tax
Fair value movement on derivatives
Fair value movement on borrowings
Finance cost
Finance income
Profit/(loss) before income tax
Income tax
Total profit/(loss) after tax
Profit/(loss) per share
Basic profit/(loss) per share
Diluted profit/(loss) per share
2018
$’000
47,817
Restated
2017
$’000
41,591
(32,854)
(32,379)
14,963
42,961
213
(2,431)
(9,150)
102
(21)
(1,630)
45,007
9,212
(775)
618
(2,952)
(7,650)
1,749
110
-
312
(27,687)
(12,530)
(4,434)
(7,487)
149
5,548
-
-
(4,318)
869
(15,667)
-
5,548
(15,667)
Cents
0.40
0.40
Cents
(1.60)
(1.60)
Notes
3
4
15
12
5
20
8
19
18
6
6
7
24
24
Section 2: Financial statements 45
Statement of Comprehensive Income
For the year ended 30 June 2018
Total profit/(loss) after tax
Other comprehensive profit, net of tax
Items that may be reclassified to profit or loss:
Exchange differences on translation
Total comprehensive income/(loss)
2018
$’000
5,548
Restated
2017
$’000
(15,667)
5
-
5,553
(15,667)
46 Bathurst Resources Limited Annual Report 2018
Balance Sheet
As at 30 June 2018
ASSETS
Current assets
Cash and cash equivalents
Restricted short-term deposits
Trade and other receivables
Inventories
New Zealand emission units
Other financial assets
Total current assets
Non-current assets
Property, plant and equipment
Mining licences, properties, exploration and evaluation assets
Crown indemnity
Interest in joint venture
Other financial assets
Total non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Trade and other payables
Borrowings
Deferred consideration
Provisions
Total current liabilities
Non-current liabilities
Trade and other payables
Borrowings
Derivative liabilities
Deferred consideration
Provisions
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Debt instruments – equity component
Reserves
Accumulated losses
TOTAL EQUITY
Notes
2018
$’000
Restated
2017
$’000
9
10
11
12
13
21
15
17
18
20
21
17
18
19
20
21
22
22
23
20,179
28,892
4,037
3,903
1,226
396
25
3,808
4,199
2,083
233
20
29,766
39,235
17,521
26,307
351
45,436
114
89,729
119,495
5,735
1,895
1,258
1,160
10,048
-
27,883
-
6,350
4,768
39,001
49,049
70,446
14,325
20,614
-
3,515
114
38,568
77,803
7,677
23,697
953
1,111
33,438
143
10,340
17,809
6,975
2,874
38,141
71,579
6,224
263,179
43,788
249,092
-
(31,837)
(32,636)
(204,684)
(210,232)
70,446
6,224
Section 2: Financial statements 47
Statement of Changes in Equity
For the year ended 30 June 2018
Contributed
Equity
$’000
247,378
-
-
1,714
1,714
249,092
-
Debt
Instrument
Equity
Component
$’000
-
-
-
-
-
-
-
14,087
43,788
52
-
226
-
226
278
-
-
-
14,087
263,179
-
43,788
43,788
794
794
1,072
1 July 2016
Comprehensive loss
Share-based
payments expense
Contributions of
equity
30 June 2017
(restated)
Comprehensive
profit
Contributions of
equity
Share-based
payments expense
30 June 2018
Share-
Based
Payment
Foreign
Exchange
Retained
Earnings
Re-
organisation
Reserve
Total
Equity
$’000
$’000
$’000
(154)
(194,565)
-
-
-
-
(15,667)
-
-
(15,667)
$’000
(32,760)
$’000
19,951
-
-
-
-
(15,667)
226
1,714
(13,727)
(154)
(210,232)
(32,760)
6,224
5
-
-
5
5,548
-
-
5,548
-
-
-
-
(149)
(204,684)
(32,760)
5,553
57,875
794
64,222
70,446
48 Bathurst Resources Limited Annual Report 2018
Statement of Cash Flows
For the year ended 30 June 2018
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Dividend from BT Mining
Net cash inflow from operating activities
Cash flows from investing activities
Exploration and consenting expenditure
Mining assets (including capitalised waste moved in advance)
Property, plant and equipment purchases
Proceeds from disposal of property, plant and equipment
Restricted deposits
Deferred consideration
Advances paid to/further investment in BT Mining
BT Mining repayment of loan to the Company
Other
Net cash outflow from investing activities
Cash flows from financing activities
Proceeds from borrowings
Interest received
Interest and other finance costs paid
Repayment of borrowings
Interest on debt instruments
Net cash (outflow)/inflow from financing activities
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
9
Notes
2018
$’000
2017
$’000
47,934
41,155
(39,726)
(31,992)
15
26
13,000
21,208
(292)
(8,581)
(3,382)
-
(230)
(903)
(21,044)
9,084
59
15
15
-
9,163
(889)
(5,759)
(3,770)
925
(1,225)
(809)
(4,290)
-
(19)
(25,289)
(15,836)
732
195
(283)
(2,240)
(3,036)
(4,632)
(8,713)
28,892
20,179
35,567
81
(163)
(3,026)
(219)
32,240
25,567
3,325
28,892
Section 2: Financial statements 49
Notes to the Financial Statements
For the year ended 30 June 2018
1. Summary of significant accounting policies
A. General information
(i) Impairment
Bathurst Resources Limited (“Company” or “Parent”) is a company
incorporated and domiciled in New Zealand, registered under the
Companies Act 1993 and is listed on the Australian Securities
Exchange (“ASX”). These financial statements have been prepared
in accordance with the ASX listing rules.
These financial statements have been approved for issue by the
Board of Directors on 27 August 2018.
The financial statements presented as at and for the year ended
30 June 2018 comprise the Company and its subsidiaries (together
referred to as the “Group”). Joint ventures are accounted for using
the equity method.
The Group is principally engaged in the exploration, development
and production of coal.
B. Basis of preparation
These Group financial statements have been prepared in
accordance with Generally Accepted Accounting Practice in
New Zealand (“NZ GAAP”). The Group is a for-profit entity for the
purposes of complying with NZ GAAP. The consolidated financial
statements comply with New Zealand Equivalents to International
Financial Reporting Standards (“NZ IFRS”), other New Zealand
accounting standards and authoritative notices that are applicable
to entities that apply NZ IFRS. The financial statements also
comply with International Financial Reporting Standards (“IFRS”).
These financial statements are presented in New Zealand dollars,
which is the Company’s functional and presentation currency.
References in these financial statements to ‘$’ and ‘NZ$’ are to
New Zealand dollars.
All financial information has been rounded to the nearest thousand
unless otherwise stated.
C. Measurement basis
These financial statements have been prepared under the
historical cost convention, except for certain financial assets and
liabilities that are measured at fair value through profit or loss.
D. Critical estimates, judgements and errors
Estimates and judgements are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that may have a financial impact on the Group and
that are believed to be reasonable under the circumstances.
The Group makes estimates and assumptions concerning the
future. The resulting accounting estimates will, by definition,
seldom equal the related actual results. The estimates and
assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities are
discussed below.
50 Bathurst Resources Limited Annual Report 2018
The future recoverability of the assets recorded by the Group is
dependent upon a number of factors, including whether the Group
decides to exploit its mine property itself or, if not, whether it
successfully recovers the related asset through sale.
Factors that could impact future recoverability include the level
of reserves and resources, future technological changes, costs
of drilling and production, production rates, future legal and
regulatory changes, and changes to commodity prices and foreign
exchange rates. This impacts both an assessment of whether
impairment should be recognised, as well as if there are indicators
that previously recognised impairment should be reversed.
(ii) Valuation of deferred consideration
In valuing the deferred consideration payable under business
acquisitions management uses estimates and assumptions. This
includes future coal prices, discount rates, coal production, and
the timing of payments. The amounts of deferred consideration
are reviewed at each balance date and updated based on best
available estimates and assumptions at that time. The carrying
amount of deferred consideration is set out in note 20.
(iii) Convertible notes and redeemable convertible
preference shares
The conversion feature of the convertible notes is included in
Equity as Debt Instruments – equity component. The Group has
made a judgement that the conversion feature of these debt
instruments should be classified as equity. This judgement was
made on the basis that the conversion feature satisfies the equity
classification test of converting a fixed amount of debt principal
to a fixed quantity of the Group’s own shares (the ‘fixed for fixed’
test). Because of this classification the value attributed to the
conversion feature is not subsequently remeasured after initial
recognition through profit or loss. Refer to note 1(y) for further
information on the treatment of the conversion feature.
(iv) Reserves and resources
Reserves and resources are based on information compiled by a
Competent Person as defined in accordance with the Australasian
Code of Mineral Resources and Ore Reserves of 2012 (the JORC
Code). There are numerous uncertainties inherent in estimating
reserves and assumptions that are valid at the time of estimation
but that may change significantly when new information becomes
available. Changes in forecast prices of commodities, exchange
rates, production costs or recovery rates may change the
economic status and may, ultimately, result in the reserves being
restated. Such changes in reserves could impact on depreciation
and amortisation rates, asset carrying values and provisions for
rehabilitation.
1. Summary of significant accounting policies (continued)
D. Critical estimates, judgements and errors continued
(v) Provision for rehabilitation
In calculating the estimated future costs of rehabilitating and
restoring areas disturbed in the mining process certain estimates
and assumptions have been made. The amount the Group is
expected to incur to settle these future obligations includes
estimates in relation to the appropriate discount rate to apply to
the cash flow profile, expected mine life, application of the relevant
requirements for rehabilitation, and the future expected costs of
rehabilitation.
Changes in the estimates and assumptions used could have a
material impact on the carrying value of the rehabilitation provision
and related asset. The provision is reviewed at each reporting
date and updated based on the best available estimates and
assumptions at that time. The carrying amount of the rehabilitation
provision is set out in note 21.
(vi) Waste in advance
Waste moved in advance is calculated with reference to the
stripping ratio (waste moved over coal extracted) of the area of
interest and the excess of this ratio over the estimated stripping
ratio for the area of interest expected to incur over its life.
Management estimates this life of mine ratio based on geological
and survey models as well as reserve information for the areas of
interest.
E. Principles of consolidation
Subsidiaries
Subsidiaries are all entities over which the Group has control. The
Group controls an entity when the Group is exposed to, or has
rights to, variable returns from its involvement with the Company
and has the ability to affect those returns through its power over
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.
The Group applies the acquisition method to account for business
combinations. The consideration transferred for the acquisition
of a subsidiary is the fair values of the assets transferred, the
liabilities incurred to the former owners of the acquiree and
the equity interests issued by the Group. The consideration
transferred includes the fair value of any asset or liability resulting
from a contingent consideration arrangement. Identifiable assets
acquired and liabilities and contingent liabilities assumed in a
business combination are measured initially at their fair values at
the acquisition date. The Group recognises any non-controlling
interest in the acquiree on an acquisition-by-acquisition basis,
either at fair value or at the non-controlling interest’s proportionate
share of the recognised amounts of acquiree’s identifiable net
assets. Acquisition-related costs are expensed as incurred.
Contingent consideration (deferred consideration) to be
transferred by the Group is recognised at fair value at the
acquisition date. Subsequent changes to the fair value of the
contingent consideration that is deemed to be a financial asset
or financial liability is recognised in accordance with NZ IAS 39 in
profit or loss as ‘fair value (loss)/gain on deferred consideration’.
The excess of the consideration transferred, the amount of any
non-controlling interest in the acquiree and the acquisition-date
fair value of any previous equity interest in the acquiree over the
fair value of the identifiable net assets acquired is recorded as
goodwill. If the total of consideration transferred, non-controlling
interest recognised and previously held interest measured is less
than the fair value of the net assets of the subsidiary acquired
in the case of a bargain purchase, the difference is recognised
directly in the income statement.
Inter-company transactions, balances and unrealised gains on
transactions between group companies are eliminated. Unrealised
losses are also eliminated.
Joint arrangements
Joint arrangements are classified as either joint operations or joint
ventures depending on the contractual rights and obligations of
each investor. The Company has assessed the nature of its joint
arrangements and determined them to be joint ventures. Joint
ventures are accounted for using the equity method.
Under the equity method of accounting, interests in joint ventures
are initially recognised at cost and adjusted thereafter to recognise
the Group’s share of the post-acquisition profits or losses and
movements in other comprehensive income. When the Group’s
share of losses in a joint venture equals or exceeds its interests
in the joint venture (which includes any long-term interests that,
in substance, form part of the Group’s net investment in the joint
venture), the Group does not recognise further losses, except to
the extent that the Group has an obligation or has made payments
on behalf of the investee.
Section 2: Financial statements 51
1. Summary of significant accounting policies (continued)
F. Foreign currency translation
(iii) Interest income
(i) Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at year
end exchange rates of monetary assets and liabilities denominated
in foreign currencies are recognised in profit or loss.
(ii) Group companies
The results and financial position of foreign operations (none of
which has the currency of a hyperinflationary economy) that have
a functional currency different from the presentation currency are
translated into the presentation currency as follows:
• assets and liabilities for each balance sheet presented are
translated at the closing rate at the date of that balance sheet;
• income and expenses for each income statement and statement
of comprehensive income are translated at monthly average
exchange rates (unless this is not a reasonable approximation of
the cumulative effect of the rates prevailing on the transaction
dates, in which case income and expenses are translated at the
dates of the transactions); and
• all resulting exchange differences are recognised in other
comprehensive income.
G. Revenue recognition
Revenue is recognised and measured at the fair value of the
consideration received or receivable to the extent it is probable
that the economic benefits will flow to the Group and the revenue
can be reliably measured. The following specific recognition
criteria must also be met before revenue is recognised:
(i) Sale of goods
Revenue from the sale of goods is recognised when there is an
executed sales agreement at the time of delivery of the goods to
the customer, indicating that there has been a transfer of risks and
rewards to the customer, no further work or processing is required,
the quantity and quality of the goods have been determined, the
price is fixed and when title has passed.
(ii) Freight income
Revenue from freight services is recognised in the accounting
period in which the services are provided. Revenue is not
recognised until the service has been completed.
Interest income is recognised as interest accrues using the
effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest
income over the relevant period using the effective interest rate,
which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to the net
carrying amount of the financial asset.
H. Income tax
The income tax expense or benefit for the period is the tax payable
on the current period’s taxable income based on the applicable
income tax rate for each jurisdiction adjusted by changes in
deferred tax assets and liabilities attributable to temporary
differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax
laws enacted or substantively enacted at the end of the reporting
period in the countries where the Company’s subsidiaries operate
and generate taxable income. Management periodically evaluates
positions taken in tax returns with respect to situations in which
applicable tax regulation is subject to interpretation. It establishes
provisions where appropriate on the basis of amounts expected to
be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method,
on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial
statements. However, deferred tax liabilities are not recognised if
they arise from the initial recognition of goodwill. Deferred income
tax is also not accounted for if it arises from initial recognition
of an asset or liability in a transaction other than a business
combination that at the time of the transaction affects neither
accounting or taxable profit or loss. Deferred income tax is
determined using tax rates (and laws) that have been enacted or
substantially enacted by the end of the reporting period and are
expected to apply when the related deferred income tax asset is
realised or the deferred income tax liability is settled.
Deferred tax assets are recognised for deductible temporary
differences and unused tax losses only if it is probable that future
taxable amounts will be available to utilise those temporary
differences and losses.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to offset current tax assets and liabilities
and when the deferred tax balances relate to the same taxation
authority. Current tax assets and tax liabilities are offset where
the Company 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.
52 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 1. Summary of significant accounting policies (continued)
H. Income tax continued
Current and deferred tax is recognised in profit or loss, except
to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax
is also recognised in other comprehensive income or directly in
equity, respectively.
I. Inventories
Raw materials and stores, work in progress and finished goods are
stated at the lower of cost and net realisable value. Cost comprises
direct materials, direct labour and an appropriate proportion of
variable and fixed overhead expenditure, the latter being allocated
on the basis of normal operating capacity. Costs are assigned
to inventory on the basis of weighted average costs. Costs of
purchased inventory are determined after deducting rebates and
discounts. Net realisable value is the estimated selling price in the
ordinary course of business less the estimated costs necessary to
make the sale.
Loans and receivables are subsequently carried at amortised cost
using the effective interest rate method.
Cash and cash equivalents
Cash and cash equivalents in note 9 comprise cash at bank and
on hand and short-term deposits with an original maturity of three
months or less.
For the purposes of the statement of cash flows, cash and cash
equivalents consist of cash and cash equivalents as defined above,
net of outstanding bank overdrafts, and excluding restricted
cash deposits.
Trade receivables
Trade receivables are recognised initially at fair value plus
transaction costs and subsequently measured at amortised cost
using the effective interest method, less provision for impairment.
Trade receivables are generally due for settlement within 30 days.
They are presented as current assets unless collection is not
expected for more than 12 months after the reporting date.
J. Financial instruments
Trade and other payables
These amounts represent liabilities for goods and services
provided to the Group prior to the end of financial year which are
unpaid. The amounts are unsecured and are usually paid within
30 days of recognition. Trade and other payables are presented as
current liabilities unless payment is not due within 12 months from
the reporting date.
They are recognised initially at their fair value less transaction
costs and subsequently measured at amortised cost using the
effective interest method.
Deferred consideration
The fair value of deferred consideration payments is determined
at acquisition date. Subsequent changes to the fair value of
the deferred consideration are recognised through the income
statement. The portion of the fair value adjustment due to the time
value of money (unwinding of discount) is recognised as a finance
cost. For further information on deferred consideration refer to
note 20.
(i) Non-derivative financial instruments
Non-derivative financial instruments comprise trade and other
receivables, cash and short-term deposits, other financial assets,
loans to related parties, deferred consideration, borrowings and
other payables.
Non-derivative financial instruments are recognised initially
at fair value plus, for instruments not at fair value through the
income statement, transaction costs. Subsequent to initial
recognition non-derivative financial instruments are measured
as described below.
A financial instrument is recognised if the Group becomes party
to the contractual provisions of the instrument. Financial assets
are derecognised if the Group’s contractual rights to the cash
flows from the financial asset expire or if the Group transfers
the financial asset to another party without retaining control of
substantially all risks and rewards of the asset. Financial liabilities
are derecognised if the Group’s obligations specified in the
contract expire or are discharged or are cancelled.
Financial assets carried at amortised cost
Loans and receivables are non-derivative financial assets with
fixed or determinable payments that are not quoted in an active
market. They are included in current assets, except for those that
are not expected to be recovered within the next 12 months.
Management determines the classification of its investments at
initial recognition.
Section 2: Financial statements 53
1. Summary of significant accounting policies (continued)
J. Financial instruments continued
Financial assets
Borrowings
Borrowings are initially recognised at fair value, net of transaction
costs incurred. Borrowings are subsequently measured at
amortised cost. Any difference between the proceeds (net of
transaction costs) and the redemption amount is recognised in
profit or loss over the period of the borrowings using the effective
interest method. Fees paid on the establishment of loan facilities
are recognised as transaction costs of the loan to the extent that
it is probable that some or all of the facility will be drawn down.
In this case, the fee is deferred until the draw down occurs. To
the extent there is no evidence that it is probable that some or
all of the facility will be drawn down, the fee is capitalised as a
prepayment for liquidity services and amortised over the period of
the facility to which it relates. Borrowings denominated in foreign
currency are re-translated at each reporting period to account for
unrealised foreign exchange movements.
The fair value of the liability portion of a convertible instrument
is determined using a market interest rate for an equivalent
non-convertible bond. This amount is recorded as a liability on an
amortised cost basis until extinguished on conversion or maturity
of the bonds. The remainder of the proceeds is allocated to the
conversion option. This is recognised and included in shareholders’
equity, net of income tax effects.
Borrowings are classified as current liabilities unless the Group
has an unconditional right to defer settlement of the liability for at
least 12 months after the reporting period.
(ii) Derivative financial instruments
Derivative instruments are initially recognised at fair value, and
subsequently measured at fair value with movements in fair value
recognised in profit or loss. Associated transaction costs are
expensed as incurred.
From time to time the Group may use derivative financial
instruments to hedge its exposure to commodity risks and foreign
exchange risks arising from operational and financing activities.
Derivatives that do not qualify for hedge accounting are accounted
for as trading instruments.
K. Impairment
The Group assesses at the end of each reporting period whether
there is objective evidence that an asset or group of assets
is impaired.
A financial asset or a group of financial assets is impaired and
impairment losses are incurred only if there is objective evidence
of impairment as a result of an event that occurred after the initial
recognition of the asset (a ‘loss event’) and that loss event (or
events) has an impact on the estimated future cash flows that can
be reliably estimated.
For loans and receivables, the amount of the loss is measured
as the difference between the asset’s carrying amount and the
present value of estimated future cash flows (excluding future
credit losses that have not been incurred) discounted at the
financial asset’s original effective interest rate.
The carrying amount of the asset is reduced and the amount of
the loss is recognised in profit or loss. As a practical expedient, the
Group may measure impairment on the basis of an instrument’s fair
value using an observable market price.
Non-financial assets
For non-financial assets, the recoverable amount is the higher
of an asset’s fair value less costs to sell and value in use. For
the purposes of assessing impairment, assets are grouped at
the lowest levels for which there are separately identifiable
cash inflows which are largely independent of the cash inflows
from other assets or groups of assets (cash-generating units).
Exploration and evaluation and mining licences and properties
assets, as well as property, plant and equipment are assessed
for impairment collectively as part of their respective
cash-generating units.
Non-financial assets other than goodwill that suffered impairment
are reviewed for possible reversal of the impairment at the end of
each reporting period.
L. Property, plant and equipment
All property, plant and equipment are measured at cost less
depreciation and accumulated impairment losses. Cost includes
expenditure that is directly attributable to the acquisition of
the asset.
Subsequent costs are included in the asset’s carrying amount
or recognised as a separate asset, as appropriate, only when it
is probable that future economic benefits associated with the
expenditure will flow to the Group. The carrying amount of any
component accounted for as a separate asset is derecognised
when replaced. All other repairs and maintenance are charged
to profit or loss during the reporting period in which they
are incurred.
54 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 1. Summary of significant accounting policies (continued)
L. Property, plant and equipment continued
N. Exploration and evaluation expenditure
Depreciation is recognised in profit or loss over the estimated
useful lives of each item of property, plant and equipment.
Leasehold improvements and certain leased plant and equipment
are depreciated over the shorter of the lease term and their
useful lives.
The estimated useful lives for significant items of property, plant
and equipment are as follows:
Buildings
Mine infrastructure
Plant and machinery
Plant and machinery leased
Furniture, fittings and equipment
25 years
3 – 8 years
2 – 25 years
Units of use
3 – 8 years
The assets’ residual values and useful lives are reviewed, and
adjusted if appropriate, at the end of each reporting period.
An asset’s carrying amount is written down immediately to its
recoverable amount if the asset’s carrying amount is greater than
its estimated recoverable amount (note 1(k)).
Any gain or loss on disposals of an item of property, plant and
equipment (calculated as the difference between the net proceeds
from disposal and the carrying amount of the item) is recognised
in profit or loss.
M. Mining and development properties
Mining licences and development properties include the cost of
acquiring and developing mining properties, licences, mineral
rights and exploration, evaluation and development expenditure
carried forward relating to areas where production has
commenced.
These assets are amortised using the unit of production basis
over the proven and probable reserves. Amortisation starts from
the date when commercial production commences. An asset’s
carrying amount is written down immediately to its recoverable
amount if the asset’s carrying amount is greater than its estimated
recoverable amount.
Subsequent costs are included in the asset’s carrying amount
or recognised as a separate asset, as appropriate, only when it
is probable that future economic benefits associated with the
asset will flow to the Group and the cost of the item can be
measured reliably.
Exploration and evaluation expenditure incurred is capitalised
to the extent that the expenditure is expected to be recovered
through the successful development and exploitation of the area
of interest, or the exploration and evaluation activities in the area
of interest have not yet reached a point where such an assessment
can be made. All other exploration and evaluation expenditure is
expensed as incurred.
Capitalised costs are accumulated in respect of each identifiable
area of interest. Costs are only carried forward to the extent that
tenure is current and they are expected to be recouped through
the successful development of the area (or, alternatively by
its sale) or where activities in the area have not yet reached a
stage which permits reasonable assessment of the existence of
economically recoverable reserves and operations in relation to the
area are continuing.
Accumulated costs in relation to an abandoned area are written off
in full against profit in the period in which the decision to abandon
the area is made.
When production commences, the accumulated costs for the
relevant area of interest are amortised over the life of the area
according to the rate of depletion of the economically recoverable
reserves.
A regular review is undertaken of each area of interest to
determine the appropriateness of continuing to carry forward
costs in relation to that area of interest.
O. Waste in advance
Waste removed in advance costs incurred in the development of
a mine are capitalised as parts of the costs of constructing the
mine and subsequently amortised over life of the relevant area of
interest or life of mine if appropriate (“life of mine”).
Waste removal normally continues through the life of the mine. The
Group defers waste removal costs incurred during the production
stage of its operations and discloses them within the cost of
constructing the mine.
The amount of waste removal costs deferred is based on the ratio
obtained by dividing the volume of waste removed by the tonnage
of coal mined. Waste removal costs incurred in the period are
deferred to the extent that the current period ratio exceeds the life
of mine ratio. Costs above the life of ore component strip ratio are
deferred to waste removed in advance. The stripping activity asset
is amortised on a units of production basis. The life of mine ratio is
based on proven and probable reserves of the operation.
Section 2: Financial statements 55
1. Summary of significant accounting policies (continued)
O. Waste in advance continued
Waste moved in advance costs form part of the total investment
in the relevant cash-generating unit, which is reviewed for
impairment if events or changes in circumstances indicate that the
carrying value may not be recoverable.
Changes to the life of mine stripping ratio are accounted for
prospectively.
P. Share-based payments
Share-based compensation benefits are provided to employees via
the Bathurst Resources Limited Long Term Incentive Plan.
The fair value of performance rights granted under the Bathurst
Resources Limited Long Term Incentive Plan is recognised as
an employee benefits expense with a corresponding increase
in equity. The total amount to be expensed is determined by
reference to the fair value of the rights granted, which includes any
market performance conditions and the impact of any non-vesting
conditions but excludes the impact of any service and non-market
performance vesting conditions.
Non-market vesting conditions are included in assumptions about
the number of rights that are expected to vest. The total expense
is recognised over the vesting period, which is the period over
which all of the specified vesting conditions are to be satisfied.
At the end of each period, the Company revises its estimates of
the number of rights that are expected to vest based on the
non-market vesting conditions. It recognises the impact of
the revision to original estimates, if any, in profit or loss, with a
corresponding adjustment to equity.
Q. Provisions
Provision for rehabilitation
Provisions are made for site rehabilitation costs relating to areas
disturbed during the mine’s operation up to reporting date but
not yet rehabilitated. The provision is based on management’s
best estimate of future costs of rehabilitation. When the provision
is recognised, the corresponding rehabilitation costs are
recognised as part of mining property and development assets.
At each reporting date, the rehabilitation liability is re-measured
in line with changes in the timing or amount of the costs to be
incurred. Changes in the liability relating to rehabilitation of
mine infrastructure and dismantling obligations are added to or
deducted from the related asset.
If the change in the liability results in a decrease in the liability
that exceeds the carrying amount of the asset, the asset is written
down to nil and the excess is recognised immediately in the income
statement. If the change in the liability results in an addition to
the cost of the asset, the recoverability of the new carrying value
is considered. Where there is an indication that the new carrying
amount is not fully recoverable, an impairment test is performed
with the write down recognised in the income statement in the
period in which it occurs.
The net present value of the provision is calculated using an
appropriate discount rate, the unwinding of the discount applied
in calculating the net present value of the provision is charged to
the income statement in each reporting period and is classified as
a finance cost.
R. Leases
The determination of whether an arrangement is, or contains, a
lease is based on the substance of the arrangement and requires
an assessment of whether the fulfilment of the arrangement
is dependent on the use of a specific asset or assets and the
arrangement conveys a right to use the asset.
Finance leases, those under which a significant portion of the risks
and rewards of ownership are transferred to the Company, are
capitalised at the lease’s inception at the fair value of the leased
property, or, if lower, the present value of the minimum lease
payments. The corresponding rental obligations, net of finance
charges, are included in other short-term and long-term payables.
Capitalised leased assets are depreciated over the shorter of the
estimated useful life of the asset and the lease term if there is no
reasonable certainty that the Group will obtain ownership by the
end of the lease term.
Operating lease payments are recognised as an expense in the
income statement on a straight-line basis over the lease term.
Operating lease incentives are recognised as a liability when
received and subsequently reduced by allocating lease payments
between rental expense and reduction of the liability.
S. Intangible assets – emissions trading units
Emissions trading units are acquired by the Group to satisfy its
obligations under the New Zealand Emissions Trading Scheme.
These units have a finite useful life but are not amortised because
they are expected to be utilised to offset the Group’s obligation
under the Emissions Trading Scheme within 12 months of balance
date. The units are recognised at cost.
56 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 1. Summary of significant accounting policies (continued)
T. Goods and Services Tax
W. Segment reporting
Revenues, expenses and assets are recognised net of the amount
of goods and services tax (“GST”), except where the GST incurred
on a purchase of goods and services is not recoverable from the
taxation authorities, in which case the GST is recognised as part
of the cost of acquisition of the asset or as part of an item of
the expense item as applicable. Receivables and payables in the
balance sheet are shown inclusive of GST. The net amount of GST
recoverable from, or payable to, the taxation authority is included
as part of receivables or payables in the balance sheet. Cash
flows are included in the statement of cash flows on a gross basis
and the GST component of cash flows arising from investing and
financing activities, which is recoverable from, or payable to, the
taxation authority, are classified as operating cash flows.
U. Contributed equity
Ordinary shares are classified as equity. Issued and paid up capital
is recognised at the fair value of the consideration received by the
Company. Any transaction costs arising on the issue of ordinary
shares are recognised directly in equity as a reduction of the share
proceeds received.
V. Earnings per share
(i) Basic earnings per share
Basic earnings per share is calculated by dividing:
• the profit attributable to owners of the Company, excluding any
costs of servicing equity other than ordinary shares
• by the weighted average number of ordinary shares outstanding
during the financial year, adjusted for bonus elements in
ordinary shares issued during the year.
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into account:
• the after income tax effect of interest and other financing costs
associated with dilutive potential ordinary shares, and
• the weighted average number of additional ordinary shares that
would have been outstanding assuming the conversion of all
dilutive potential ordinary shares.
Operating segments are reported in a manner consistent with
the internal reporting provided to the chief operating decision
maker. The chief operating decision maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the Board of Directors.
X. New accounting standards and interpretations not
yet effective
At the date of authorisation of the financial statements, three
accounting standards were on issue but not yet effective. The
Group does not intend to apply these pronouncements until their
effective date.
(i) NZ IFRS 9 Financial Instruments
Effective for periods beginning on or after 1 January 2018,
expected to be applied in the financial year ending 30 June 2019.
The standard adds requirements related to the classification,
measurement of financial instruments. No material impact is
expected from the adoption of this standard.
(ii) NZ IFRS 15 Revenue from contracts with customers
Effective for periods beginning on or after 1 January 2018,
expected to be applied in the financial year ending 30 June 2019.
The standard details a comprehensive principles-based approach
on how to recognise revenue from contracts with customers.
It is expected that this standard may affect the Group’s
recognition of certain revenue items but is not expected to have
a material impact.
(iii) NZ IFRS 16 Leases
Effective for periods beginning on or after 1 January 2019,
expected to be applied in the financial year ending 30 June 2020.
The standard eliminates the distinction between operating and
finance leases. A formal impact assessment is yet to be undertaken
however this standard is not expected to have a material impact.
Y. Standards and interpretations adopted during the year
The financial information presented for the year ended 30 June
2018 has been prepared using accounting policies consistent with
those applied in the Group’s 30 June 2017 financial statements,
except for the restatement of the Company’s convertible notes
and redeemable convertible preference shares (“convertible
instruments”).
Section 2: Financial statements 57
1. Summary of significant accounting policies (continued)
Y. Standards and interpretations adopted during the year continued
Restatement of prior year comparatives - convertible instruments and subsequent modification
On recognition of a convertible debt instrument, the underlying debt liability and conversion feature (the ability to convert the instrument
into shares) must be assessed separately for classification. A key judgement applied is with respect to whether the conversation feature
can be classified as equity.
Whether a conversion feature can classify as equity is known as the ‘fixed for fixed’ test. The conversion feature must represent a fixed
amount of debt principal convertible into a fixed quantity of shares (equity). The result of classifying the conversion feature as equity is
that the value attributed to the conversion feature does not have to be subsequently remeasured after initial recognition. If the conversion
feature fails the fixed for fixed test, the conversion feature must be classified as a derivative liability and re-measured at each reporting
date at fair value through profit or loss.
The convertible instruments at 30 June 2017 were denominated in AUD and the share price conversion also in AUD, meaning that at the
point of converting these instruments into the Group’s shares, no further cash would change hands and the instrument holder would
receive the same number of shares on conversion date as at issue date. For this reason, the Group judged at that time that the conversion
feature met the fixed for fixed test, with the conversion option being included in Equity as ‘debt instruments – equity component’ in the
30 June 2017 Financial Statements.
It is noted that when the debt principal in AUD is translated to the Group’s functional currency (NZD), this does create variability in the
amount recorded. The Group has restated at 30 June 2017 the conversion feature for the convertible instruments from equity to derivative
liabilities to provide more relevant information about the effect of these convertible instruments.
On 31 December 2017, the terms of the Convertible Notes were modified so that they are denominated in NZD and would convert to a fixed
number of shares. This removes the translation from AUD to NZD variability for reporting purposes and satisfies the fixed for fixed test.
This means the conversion feature is now classified as debt instruments – equity component within Equity.
A summary of the key disclosure changes to the convertible instruments as at 30 June 2017 are noted below:
Convertible Notes
Underlying host debt liability
Conversion option
Redeemable Convertible Preference Shares
Underlying host debt liability
Conversion option
Classification
Dollar values ($’000)
Original
Restated
Original
Restated
Liability
Liability
Equity
Derivative Liability
Liability
Liability
Equity
Derivative Liability
10,428
1,380
11,276
414
6,809
17,647
11,382
162
The impact on the loss recorded for 30 June 2017 was $12.5m increase in fair value movement on derivatives expense, and $1.0m increase
in finance expenses. Consequently the loss per share attributable to the ordinary equity holders of the Company was restated as follows:
Basic loss per share for the year ended 30 June 2017
Diluted loss per share for the year ended 30 June 2017
Cents
Original
Restated
(0.19)
(0.19)
(1.60)
(1.60)
58 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018
2. Segment information
Management has determined operating segments based on the reports reviewed by the Board of Directors that are used to make strategic
decisions.
The presentation of segments for 30 June 2018 has been modified to that presented in the 30 June 2017 Financial Statements. This
reflects a change in how management view business operations with the integration of BT Mining Limited (“BT Mining”) (for further
information refer note 15).
The Export segment represents the previous Bathurst operating segment Buller Coal and 100 percent of BT Mining’s South Island export
mine results. The Domestic segment represents the prior Bathurst Eastern Coal segment and 100 percent of the two BT Mining North
Island domestic mines. Bathurst Corporate now also includes 100 percent of BT Mining Corporate.
A reconciliation to profit after tax per Bathurst's Income Statement is provided via the elimination of BT Mining column.
Total assets and total liabilities are reported on a group basis, as with tax expense.
Three Bathurst customers met the reporting threshold of 10 percent of Bathurst’s operating revenue in the year to 30 June 2018,
contributing $17.8m, $6.4m and $6.3m (2017: two customers contributing $11.4m and $5.7m).
Year ended 30 June 2018
Revenue
EBITDA¹
Share of equity accounted profit
- BT Mining 65%
Income tax expense
Operating profit/(loss)
after tax
Fair value movements
Net finance costs
Comprehensive income/(loss)
after tax
Amounts included in
comprehensive income/(loss)
Export
Domestic
Corporate
TOTAL
$’000
218,579
105,001
$’000
122,588
50,865
$’000
467
(16,217)
$’000
341,634
139,649
Eliminate
BT Mining
$’000
(293,455)
(131,190)
TOTAL
Bathurst
$’000
48,179
8,459
-
-
-
-
-
-
-
42,961
(35,281)
(35,281)
35,281
-
98,437
38,718
-
(782)
-
(1,416)
(26,033)
(32,121)
(13,159)
111,122
(109,076)
*45,007
(32,121)
(15,357)
-
(32,121)
8,019
(7,338)
97,655
37,302
(106,271)
28,686
(66,094)
*5,553
Depreciation and amortisation
6,083
10,678
130
16,891
(12,006)
4,885
* Note that Total Bathurst operating profit and comprehensive income does not equal the sum of Total minus elimination of BT Mining, as the Company’s 65 percent of BT Mining’s
profit is added back
¹ Earnings before net finance costs (including interest), tax, depreciation, amortisation, impairment, fair value movement on deferred consideration, and fair value movement on
derivatives and borrowings
Section 2: Financial statements 59
Export
Domestic
Corporate
$’000
250
(1,184)
(1,294)
(1,294)
44
$’000
41,386
15,949
4,604
4,604
10,529
$’000
1,442
(4,797)
(18,977)
(18,977)
59
TOTAL
Bathurst
$’000
43,078
9,970
(15,667)
(15,667)
10,632
2018
$’000
35,831
11,986
47,817
7,939
12,494
9,096
2,454
871
32,854
163
196
2,131
933
2,288
287
794
2017
$’000
29,063
12,528
41,591
7,124
11,508
6,253
7,680
(186)
32,379
176
282
1,112
1,144
2,557
271
226
2. Segment information (continued)
Year ended 30 June 2017
Revenue
EBITDA
Profit/(loss) after tax
Comprehensive income/(loss) after tax
Depreciation and amortisation
3. Sales revenue
Coal sales
Freight
Sales revenue
4. Cost of sales
Raw materials, mining costs and consumables used
Freight costs
Mine labour costs
Amortisation expenses
Changes in inventories of finished goods and work in progress
Total cost of sales
5. Administrative and other expenses
Administrative and other expenses includes the following items:
Remuneration of auditors for audit and review of financial statements
Directors' fees
Legal fees
Consultants
Employee benefit expense
Rent
Share-based payments expense
60 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 6. Net finance costs
Interest income
Foreign exchange gain
Unrealised foreign exchange gain on debt instruments
Total finance income
Success fee
Interest expense
Interest expense on debt instruments
Realised foreign exchange loss
Unrealised foreign exchange loss on debt instruments
Provisions: unwinding of discount
Deferred consideration: unwinding of discount
Total finance costs
Total net finance costs
7. Income tax
(a) Income tax
Current tax
Deferred tax
Income tax
Reconciliation of income tax to prima facie tax payable
Profit/(loss) before income tax
Tax at the standard New Zealand rate of 28%
Tax effects of amounts not assessable in calculating taxable income:
Share of BT Mining profit
Dividend from BT
Fair value movement on derivatives and borrowings
Other permanent adjustments
Tax losses not recognised
Other deferred tax movements
Income tax
Further information relating to deferred tax is set out in note 16.
Note
21
20
2018
$’000
149
-
-
149
(854)
(458)
(3,396)
(87)
(1,764)
(255)
(673)
(7,487)
(7,338)
(2,108)
2,108
-
5,548
1,554
(12,029)
5,056
8,994
1,717
13
(5,305)
-
Restated
2017
$’000
142
296
431
869
-
(357)
(2,965)
-
-
(210)
(786)
(4,318)
(3,449)
(4,275)
4,275
-
(15,667)
(4,387)
217
-
3,508
468
439
(245)
-
Section 2: Financial statements 61
7. Income tax benefit (continued)
(b) Imputation credits
New Zealand imputation credit account
Available for use in future periods
8. Impairment losses
Impairment of exploration and evaluation assets
Impairment of mining assets
Total impairment losses
2018
$’000
5,055
5,055
630
1,000
1,630
2017
$’000
-
-
-
-
-
Note
13
13
Management has assessed the cash-generating units (“CGU”) for the Group as follows:
• Bathurst Domestic Coal, as the coal yard cannot generate its own cash flows independent of the mine. Bathurst Domestic Coal includes
Canterbury Coal, Takitimu mine and the Timaru coal yard.
• Buller Coal Project, as there is a large amount of shared infrastructure between the proposed mines, necessary blending of the pit
products at the same site, and the similar geographical location of the pits.
• Cascade mine, as the mine when in operation had established domestic markets which allow a profitable operation without relying on
infrastructure to be built for the Buller Coal Project.
Management assessed each CGU for indicators of impairment, or indicators that previously recognised impairment losses may no longer
be relevant, where appropriate.
Bathurst Domestic Coal
No indicators of impairment were present at 30 June 2018. Some specific historical balances unrelated to Bathurst’s current mining
operations were written off during the year as they could no longer be supported. Apart from these specific items, no impairment was
recorded as at 30 June 2018.
Buller Coal Project
The Buller Coal Project was previously fully impaired in the year ended 30 June 2015, in the context of reducing coking coal prices.
The Buller Coal Project has remained on care and maintenance and Management has no immediate plans to reinstate the project.
The CGU remains fully impaired at 30 June 2018.
Cascade mine
The Cascade mine was placed on care and maintenance during the year ended 30 June 2016 and remains on care and maintenance
at 30 June 2018.
62 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 9. Cash and cash equivalents
Cash at bank and on hand
Cash held in escrow
Cash and cash equivalents
2018
$’000
20,179
-
20,179
2017
$’000
3,950
24,942
28,892
The balance held in escrow at 30 June 2017 was used to settle the acquisition of certain Solid Energy assets via the Company’s joint
venture BT Mining (for further information see note 15).
10. Trade and other receivables
Trade receivables
Less: provision for impairment
Receivable from BT Mining
Other receivables and prepayments
Total trade and other receivables
The provision for impairment relates to the Company’s joint venture Bathurst Industrial Coal Limited.
11. Inventories
Raw materials and stores
Finished goods
Other
Total inventories
3,926
(500)
250
227
3,903
424
742
60
1,226
3,264
(500)
823
612
4,199
857
1,010
34
1,901
Section 2: Financial statements 63
12. Property, plant and equipment
Freehold
land
Buildings
Mine
infrastructure
Plant &
machinery
Furniture
fittings and
equipment
Work in
progress
Total
$’000
$’000
$’000
$’000
$’000
$’000
$’000
1,928
400
-
-
-
2,328
756
40
6
(110)
(4)
688
180
5
102
(21)
10,496
4,447
444
(2,180)
185
172
200
(120)
780
640
(752)
14,325
5,704
-
-
(2,431)
-
(31)
(2)
(40)
(77)
266
13,176
435
628
17,521
Year ended 30 June
2018
Opening net
book value
Additions
Transfers
Depreciation
Assets held for sale
and other disposals
Closing net
book value
As at 30 June 2018
Cost
15,785
5,977
2,796
27,954
2,603
12,752
67,867
Accumulated
depreciation and
impairment
Closing net book
value
Year ended 30 June 2017
Opening net book
value
Additions
Transfers
Depreciation
Assets held for sale
and other disposals
Closing net book
value
As at 30 June 2017
(13,457)
(5,289)
(2,530)
(14,778)
(2,168)
(12,124)
(50,346)
2,328
688
266
13,176
435
628
17,521
1,970
847
-
(889)
-
1,928
796
68
-
(108)
-
756
347
14
-
8,598
3,581
13
219
70
-
(181)
(1,670)
(104)
-
(26)
180
10,496
-
185
18
775
(13)
-
-
11,948
5,355
-
(2,952)
(26)
780
14,325
Cost
15,385
5,935
2,689
23,094
2,233
12,904
62,240
Accumulated
depreciation and
impairment
Closing net book
value
(13,457)
(5,179)
(2,509)
(12,598)
(2,048)
(12,124)
(47,915)
1,928
756
180
10,496
185
780
14,325
64 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 12. Property, plant and equipment (continued)
Included in property, plant and equipment above are the following amounts where the Group is a lessee under a finance lease:
Cost
Accumulated depreciation
Net book value
13. Mining licences, properties, exploration, and evaluation assets
Exploration and evaluation assets
Opening balance
Expenditure capitalised
Impairment recognised
Transfer to mining licences and property assets
Total exploration and evaluation assets
Mining licences and property assets
Opening balance
Expenditure capitalised
Transfer from exploration and evaluation assets
Amortisation
Impairment recognised
Abandonment provision movement
Waste moved in advance capitalised
Total mining licences and property assets
Total mining licences, property, exploration and evaluation assets
2018
$’000
7,934
(2,094)
5,840
2,022
295
(630)
(1,375)
312
18,592
301
1,375
(2,426)
(1,000)
876
8,277
25,995
26,307
2017
$’000
6,473
(1,232)
5,241
1,245
777
-
-
2,022
18,882
1,530
-
(7,680)
-
132
5,728
18,592
20,614
14. Investment in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries:
Name of entity
BR Coal Pty Limited
Bathurst New Zealand Limited
Bathurst Coal Holdings Limited
Buller Coal Limited
Bathurst Coal Limited
New Brighton Collieries Limited
Bathurst Resources (Canada) Limited
Country of
incorporation
Australia
New Zealand
New Zealand
New Zealand
New Zealand
New Zealand
Canada
Equity holding
Class of shares
2018 (%)
2017 (%)
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
100
100
100
100
100
100
100
100
100
100
100
100
100
-
All subsidiary companies have a balance date of 30 June, and are predominantly involved in the coal industry. All subsidiaries have a
functional currency of New Zealand dollars except for BR Coal Pty Ltd (Australian dollars) and Bathurst Resources (Canada) Limited
(Canadian dollars).
Bathurst Resources (Canada) Limited was incorporated in June 2018 and is the entity via which the Company invests in its new joint
venture NWP Coal Canada Limited – for further information refer to note 30.
Section 2: Financial statements 65
15. Interest in joint venture
BT Mining Limited
(a) Balances held in BT Mining
Loan to BT Mining
Equity investment
65% share of retained earnings net of dividends received
Total interest in BT Mining
Opening Balance
Increase in loan to BT Mining
Conversion of $16.25m from loan to equity investment (nil net movement)
Receipt of loan repayment
Receipt of dividend
65% share of profit/(loss)
Closing Balance
2018
$’000
-
16,250
29,186
45,436
3,515
21,044
-
(9,084)
(13,000)
42,961
45,436
2017
$’000
4,290
-
(775)
3,515
-
4,290
-
-
-
(775)
3,515
The Company holds a 65 percent shareholding in BT Mining, which on 31 August 2017 attained ownership of the mining permits and
licences as well as the mining assets at the following mine sites:
• Buller Plateau operating assets of the Stockton mine in the South Island.
• Rotowaro mine, Maramarua mine and certain assets at Huntly West mine located in the North Island.
The Company’s share of BT Mining’s profit recognised at 30 June 2018 reflects 10 months of operations. The economic lock box
arrangement that covered 1 July 2017 to 31 August 2017 was reflected in the final purchase price that BT Mining paid for the assets.
$16.25m of shareholder loans to BT Mining were converted to represent an equity investment in BT Mining through the issue of 16,250
shares. The remaining loan balance was paid back to Bathurst during the year.
The Company considers BT Mining to be a joint venture with BT Mining’s other shareholder, Talley’s Energy Limited. This is because
unanimous approval is required on activities that significantly affect BT Mining’s operations. As such BT Mining is accounted for using the
equity method.
For an unaudited proportionate consolidation presentation of Bathurst and BT Mining, refer to the Additional Information section of these
Financial Statements, after the Notes to the Financial Statements.
66 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 15. Interest in joint venture (continued)
(b) BT Mining Balance Sheet
Cash
Trade and other receivables
Inventories
New Zealand emission units
Current assets
Property, plant and equipment
Mining licences, properties, exploration and evaluation assets
Crown indemnity
Deferred tax asset
Deposit paid to Solid Energy
Non-current assets
TOTAL ASSETS
Trade and other payables
Tax payable
Derivative liabilities
Deferred consideration
Provisions
Current liabilities
Loans payable to shareholders
Provisions
Deferred consideration
Non-current liabilities
TOTAL LIABILITIES
NET ASSETS
Share capital
Retained earnings net of dividends paid
TOTAL EQUITY
Reconciliation to Bathurst’s interest in BT Mining
65% share of loans payable to shareholders
65% share of share capital
65% share of retained earnings net of dividends paid
Bathurst’s interest in BT Mining
Bathurst Industrial Coal Limited
2018
$’000
7,780
48,176
35,348
1,243
92,547
41,454
27,273
53,399
1,646
-
123,772
216,319
28,526
19,048
3,348
11,900
882
63,704
-
67,614
15,100
82,714
146,418
69,901
25,000
44,901
69,901
-
16,250
29,186
45,436
2017
$’000
415
-
-
-
415
1,207
-
-
-
4,600
5,807
6,222
814
-
-
-
-
814
6,600
-
-
6,600
7,414
(1,192)
-
(1,192)
(1,192)
4,290
-
(775)
3,515
The Company holds 50 percent shareholding in Bathurst Industrial Coal Limited. This venture has ceased to operate and it is intended
that this entity will be wound up.
Section 2: Financial statements 67
16. Deferred tax
The balance comprises temporary differences attributable to:
Tax losses
Employee benefits
Provisions
Mining licenses
Exploration and evaluation expenditure
Property, plant and equipment
Total deferred tax assets
Waste moved in advance
Total deferred tax liabilities
Net deferred tax asset not recognised
Net deferred tax asset
2018
$’000
13,819
257
803
16,984
548
8,086
40,497
(787)
(787)
2017
$’000
14,621
196
1,322
16,661
421
8,175
41,396
(787)
(787)
(39,710)
(40,609)
-
-
The Group has not recognised a net deferred tax asset of $39.7m (2017: $40.6m) on the basis that it is not probable these losses will be
utilised in the near future. Carried forward tax losses are only carried forward on the basis of meeting relevant shareholder continuity rules.
17. Trade and other payables
Current
Trade payables
Accruals
Employee benefit payable
Other payables
Interest payable
Non-current
Other payables
Total trade and other payables
18. Borrowings
Current
Secured
Lease liabilities
Subordinated bonds
Bank borrowings backing property, plant and equipment purchases
Unsecured
Redeemable convertible preference shares (“RCPS”)
1 (y)
Total current borrowings
68 Bathurst Resources Limited Annual Report 2018
1,566
1,703
1,238
306
922
5,735
-
5,735
2,604
1,849
948
626
1,650
7,677
143
7,820
Note
Restated
1,654
-
241
-
1,895
1,582
10,733
-
11,382
23,697
Notes to the Financial StatementsFor the year ended 30 June 2018 18. Borrowings (continued)
Non-current
Secured
Lease liabilities
Bank borrowings backing property, plant and equipment purchases
Subordinated bonds
Unsecured
Convertible notes
Total non-current borrowings
Total borrowings
Note
1 (y)
2018
$’000
3,714
287
11,689
12,193
27,883
29,778
Restated
2017
$’000
3,531
-
-
6,809
10,340
34,037
A summary of key details of the Company’s debt instruments (excluding lease liabilities) at 30 June 2018 is as follows:
Instrument
Convertible notes
Convertible notes
Subordinated bonds
NZD
NZD
USD
$m
$4.0m
$8.6m
$7.9m
Denomination
currency
Face value
Coupon rate
Issue date
Maturity
date
Per note
conversion
# shares
%
8%
8%
22/07/2016
22/07/2019
1/02/2017
1/02/2021
10%
1/02/2017
1/02/2020
45,455
26,667
n/a
Lease liabilities are effectively secured as the rights to the leased assets recognised in the financial statements revert to the lessor in the
event of default.
RCPS
The RCPS were fully converted to shares at the election of the Company on 18 September 2017. The amortised cost of the host debt
liability and fair value of the conversion option recorded as a derivative liability were transferred to Equity on this date. For further
information refer to note 19 and 22.
Convertible Notes (“Notes”)
Conversion
• July 2017 issue - the Notes can be converted into ordinary shares at the election of the holder any time until ten days prior to maturity
date.
• February 2018 issue - the Notes can be converted into ordinary shares at the election of the holder any time until ten days before
maturity date.
Ranking
The Notes rank equally with all other present and future unsecured obligations except for obligations accorded preference by mandatory
provisions of applicable law. Any shares issued on conversion will rank equally with all other ordinary shares.
Modification
A modification to the terms of the convertible notes effective 31 December 2017 amended the denomination currency of the instruments
from AUD to NZD (refer note 1 Y). On this date, the convertible notes were re-recognised at the fair value of both the host debt liability as
well as the conversion option.
The fair value of the liability portion noted above was determined by discounting future cash flows including interest payments using
a market interest rate for an equivalent non-convertible bond, with the difference in value on re-recognition booked to the Income
Statement as fair value movements on borrowings. The fair value of the conversion option is included in Equity (refer note 22).
Section 2: Financial statements 69
18. Borrowings (continued)
Subordinated Bonds
Redemption
The Company is entitled to elect early redemption at any time after the SPA becoming unconditional and after the 1 February 2019. If the
Subordinated Bonds are redeemed early the Company must pay 104 percent of the issue price.
Ranking
The Subordinated bonds rank equally with existing and future bonds and without priority or preference amongst themselves.
The Subordinated bonds are formally secured by the Company’s share ownership in BT Mining.
19. Derivative Liabilities
RCPS
Convertible notes
Total non-current derivative liabilities
2018
$’000
-
-
-
Restated
2017
$’000
162
17,647
17,809
Derivative liabilities measured at fair value through profit or loss at 30 June 2017 consisted of the conversion feature of the convertible
instruments.
As the RCPS were fully converted to shares, the derivative value on the date of conversion was transferred to Equity (refer note 22).
The change in denomination of the convertible notes qualified as a significant modification to the original contract terms.
The instruments were derecognised and re-recognised under the new terms, with the fair value of the conversion option transferred
to Equity (refer note 22).
Fair value was independently determined using a Black Scholes Model for the convertible notes and a binomial model for the RCPS
(as they are convertible at the option of the Company) that takes into account the exercise price, the term of the conversion option, the
current share price and expected price volatility of the underlying share, the expected dividend yield, and the risk free interest rate for
the term of the conversion option.
20. Deferred consideration
Current
Acquisition of subsidiary deferred consideration
Non-current
Acquisition of subsidiary deferred consideration
Total deferred consideration
Movement
Opening balance
Unwinding of discount
Fair value adjustment
Consideration paid during the year
Closing balance
Deferred consideration liabilities have been categorised as level 3 under the fair value hierarchy.
70 Bathurst Resources Limited Annual Report 2018
2018
$’000
1,258
6,350
7,608
7,928
673
(102)
(891)
7,608
2017
$’000
953
6,975
7,928
9,670
786
(1,749)
(779)
7,928
Notes to the Financial StatementsFor the year ended 30 June 2018 20. Deferred consideration (continued)
(a) Buller Coal Project
The Company acquired Buller Coal Limited (formerly L&M Coal Limited) in November 2010 and the sale and purchase agreement
contained an element of deferred consideration. The deferred consideration comprised cash consideration and/or royalties on coal sold
and the issue of performance shares.
The deferred cash consideration is made up of two payments of USD$40,000,000 (performance payments). The first being payable upon
25,000 tonnes of coal being shipped from the Buller Coal Project, the second payable upon 1 million tonnes of coal being shipped from the
Buller Coal Project.
The Company has the option to defer cash payment of the performance payments and elect to submit a higher royalty on coal sold
from the respective permit areas until such time the performance payments are made. The option to pay a higher royalty rate has been
assumed in the valuation and recognition of deferred consideration.
Bathurst has and will continue to remit royalty payments to L&M Coal Holdings (the vendor) on all Escarpment coal sold as required by the
Royalty Deed and this includes ongoing sales from stockpiles. Further information is included in note 29 (d).
(b) Canterbury Coal Limited
The acquisition of Canterbury Coal Limited in November 2013 contained a royalty agreement. The amounts that are payable in the
future under this royalty agreement are required to be recognised as part of the consideration paid for Canterbury Coal Limited. The fair
value of the future royalty payments is estimated using a discount rate based upon the latest New Zealand ten year government bond
rate and production profile at a set rate per tonne of coal produced. Sensitivity analysis on key inputs to the estimation of the deferrred
consideration liability are as follows:
Key input
Discount rate
Production levels
Coal prices
Change in input
Decrease/increase by 2%
Increase/decrease by 5%
Non-applicable as set at fixed rate per tonne
2018
Increase in
estimate
$’m
2018
Decrease in
estimate
$’m
(0.1)
(0.1)
0.1
0.1
(c) New Brighton Collieries Limited
The Company completed the acquisition of New Brighton Collieries Limited on 10 March 2015. The balance due on settlement is to be
satisfied by an ongoing royalty based on mine gate sales revenue. The fair value of the future royalty payments is estimated using a
discount rate based upon a risk adjusted New Zealand ten year government bond rate of 8.85% (2017: 8.98%), projected production profile,
and forecast domestic coal prices. These are based on the Group’s forecasts which are approved by the Board of Directors. Sensitivity
analysis on key inputs to the estimation of the deferrred consideration liability are as follows:
Key input
Discount rate
Production levels
Coal prices
Security
Change in input
Decrease/increase by 2%
Increase/decrease in reserves by 5%
Increase/decrease by $5 per tonne
$’m
(0.5)
(0.3)
(0.3)
$’m
0.5
0.3
0.3
Pursuant to a deed of guarantee and security the deferred consideration is secured by way of a first-ranking security interest in all of New
Brighton Collieries Limited’s present and future assets (and present and future rights, title and interest in any assets).
Section 2: Financial statements 71
21. Provisions
Current
Rehabilitation
Non-current
Rehabilitation
Total provisions
Rehabilitation provision movement:
Opening balance
Change recognised in the mining and property asset
Unwinding of discount
Recognition of provision and corresponding Crown indemnity
Other changes recognised in the income statement
Closing balance total rehabilitation provision
Rehabilitation provision
2018
$’000
1,160
1,160
4,768
5,928
3,985
905
255
351
432
5,928
2017
$’000
1,111
1,111
2,874
3,985
3,714
(132)
210
-
193
3,985
Provision is made for the future rehabilitation of areas disturbed in the mining process. Management estimates the provision based on
expected levels of rehabilitation, areas disturbed and an appropriate discount rate. A reasonable change in discount rate assumptions
would not have a material impact on the provision.
During the year the Sullivan mine permit was acquired. This permit abuts the Escarpment mine site. The Crown fully indemnified any rehab
costs that relate to pre-acquisition.
22. Equity
(a) Contributed equity – ordinary fully paid shares
Opening balance
Issue of shares from conversion of RCPS
Issue of shares from conversion of convertible notes
Closing balance
Ordinary shares
2018
Number of shares
000s
2017
Number of shares
000s
986,028
513,818
13,318
1,513,164
964,483
-
21,545
986,028
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the number
of shares held. Every ordinary share is entitled to one vote.
The RCPS were fully converted to shares at the option of the Company on 18 September 2017. 11,304 notes were converted at
AUD $1,000 per note at 2.2 cents per share.
Also during the year, 293 notes of the July 2016 issue of convertible notes were converted to shares at the option of the note holder, at
AUD $1,000 per note at 2.2 cents per share (June 2017: 474 notes).
72 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 22. Equity (continued)
(b) Contributed equity – value of issued equity
Opening balance
Issue of shares from conversion of RCPS
Issue of shares from conversion of convertible notes net of issue costs
Closing balance
2018
$’000
249,092
12,105
1,982
263,179
Restated
2017
$’000
247,378
-
1,714
249,092
The value transferred to equity on conversion of the convertible instruments was the proportional value of the amortised cost of the
underlying borrowings and the fair value of the conversion option.
(c) Debt instruments – equity component
Equity component of convertible notes
Closing balance
43,788
43,788
-
-
The option to convert the convertible notes into shares is accounted for as equity at 30 June 2018 (refer note 1 Y for further information)
measured at fair value.
For the fair value valuation methodology of the conversion options transferred to equity on conversion of the notes, and included in
debt instruments – equity component, refer to note 18.
23. Reserves
Share-based payment reserve
Foreign exchange translation reserve
Reorganisation reserve
Total reserves
Nature and purpose of reserves
Share-based payment reserve
2018
$’000
1,072
(149)
(32,760)
(31,837)
2017
$’000
278
(154)
(32,760)
(32,862)
The share-based payment reserve is used to recognise the fair value of performance rights issued.
Foreign exchange translation reserve
Exchange differences arising on translation of companies within the Group with a different functional currency to New Zealand dollars are
taken to the foreign currency translation reserve. The reserve is recognised in the income statement when the investment is disposed of.
Reorganisation reserve
Bathurst Resources Limited was incorporated on 27 March 2013. A scheme of arrangement between Bathurst Resources Limited and its
shareholders resulted in Bathurst Resources (New Zealand) Limited becoming the new ultimate parent company of the Group on 28 June
2013. A reorganisation reserve was created, which reflects the previous retained losses of subsidiaries.
Section 2: Financial statements 73
24. Earnings per share
(a) Earnings per share (“EPS”) attributable to ordinary equity holders
Basic EPS
Diluted EPS
(b) Reconciliation of earnings used in calculation
Earnings from continued operations
Earnings used in calculation of basic and diluted EPS
(c) Weighted average number of shares used as denominator
Weighted average number of shares
Used in calculation of basic and diluted EPS
2018
Cents
0.40
0.40
$’000
5,548
5,548
2017
Cents
(1.60)
(1.60)
$’000
(15,667)
(15,667)
Number of
shares
000s
1,399,047
1,399,047
Number of
shares
000s
977,645
977,645
Potential ordinary shares from the convertible notes and RCPS and performance rights are excluded from the calculation of diluted
earnings per share as they are anti-dilutive.
25. Share-based payments
(a) Transaction performance rights
Transaction performance rights were issued to certain key executives during the year, conditional on the successful signing of a sale and
purchase agreement for the acquisition of certain Solid Energy mine site assets via the Company’s joint venture vehicle, BT Mining. These
form part of the Group’s overall retention strategy, and recognises their instrumental roles in relation to the negotiation and signing of the
contract. These were approved by Shareholders at the 2016 AGM.
(b) Completion performance rights
Completion performance rights were issued to executive directors in recognition of the completion of the sale and purchase agreement
for the acquisition of certain assets from Solid Energy, and the close and transition of those assets. These form part of the Group’s overall
retention strategy, and recognises their instrumental roles in relation to the successful completion of the acquisition. These were approved
by Shareholders at the 2017 AGM.
(c) Retention performance rights
Retention performance rights were issued to senior executives in recognition of the successful close and transition of certain assets from
Solid Energy to the Company. These form part of the Group’s overall retention strategy and were approved by the Board.
(d) Key details of performance rights
Performance rights granted carry no dividend or voting rights. When exercised each performance right converts into one fully paid
ordinary share. The exercise price of all performance rights is nil.
The fair value of these rights was assessed as equal to the market value of the Company’s share price at grant date.
74 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 25. Share-based payments (continued)
Grant date
Vesting date
Transaction Performance Rights
Opening
balance
000s
Issued
000s
Expired/
forfeited
000s
Closing
balance
000s
Exercisable
000s
6 February 17
31 December 18
11,500
-
Completion performance rights
21 December 17
31 December 18
Retention performance rights
3 April 18
31 December 18
-
-
11,500
1,981
3,400
5,381
-
-
(750)
(750)
11,500
1,981
2,650
16,131
26. Reconciliation of profit/(loss) before income tax to net cash flow from
operating activities
Profit/(loss) before income tax
Dividend received from BT Mining
Non-cash items:
Unrealised FX movements
Depreciation and amortisation expense
Share of (profit)/loss of BT Mining
Rehab provision movement and discount unwinds
Fair value movements on derivatives
Fair value movements on borrowings
Unwinding of discount rate and fair value adjustment on deferred consideration
Share-based payment expense
Impairment
Other
Non-operating items:
Loss/(gain) on sale of property, plant and equipment
Interest on debt instruments
Realised foreign exchange gain on borrowing activities
Other
Movement in working capital
Cash flow from operating activities
2018
$’000
5,548
13,000
1,767
4,885
(42,961)
741
27,687
4,434
571
794
1,630
75
21
3,396
-
111
(491)
21,208
-
-
-
-
2017
$’000
(15,667)
-
(431)
10,632
775
184
12,530
-
(963)
226
-
18
(110)
1,325
(357)
106
895
9,163
Section 2: Financial statements 75
27. Financial risk management
The Group’s activities expose it to a variety of financial risks: market risk (including currency risk, and interest rate risk), credit risk and
liquidity risk.
The Group uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis in
the case of interest rate, foreign exchange and other price risks and aging analysis for credit risk.
Risk management is carried out by the management team under policies approved by the Board of Directors. Management identifies and
evaluates financial risks on a regular basis.
(a) Market risk
Foreign exchange risk
Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is
not New Zealand dollars. The risk is measured using sensitivity analysis and cash flow forecasting.
The Group had minimal operating exposure to foreign currency risk at the end of the reporting period. The Group assesses potential
foreign currency exposures on foreign currency denominated debt instruments as follows:
Foreign exchange rate movement
Debt Instrument
Denomination currency
Subordinated Bonds
USD
2018
+3%
$’000
341
2017
+3%
$’000
314
2018
-3%
$’000
(362)
2017
-3%
$’000
(334)
The above assessment is estimated based on future foreign exchange movements similar to historical rate movements for the two years to
30 June 18, on the face value of the underlying debt instruments.
(b) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The
Group has adopted a policy of only dealing with credit worthy counterparties and obtaining sufficient collateral where appropriate as a
means of minimising the risk of financial defaults.
Financial instruments which potentially subject the Group to credit risk consist primarily of cash and cash equivalents, short-term
deposits, as well as credit exposures to our customers including outstanding receivables.
The credit risk on liquid funds is limited because the counterparties are banks with credit ratings of AA-, with funds required to be
invested with a range of separate counterparties.
The Group’s maximum exposure to credit risk for trade and other receivables and loans to related parties is its carrying value.
(c) Liquidity risk
Liquidity risk represents the Group’s ability to meet its contractual obligations. The Group evaluates its liquidity requirements on an
ongoing basis.
Maturities of financial liabilities
The tables below analyse the Group’s financial liabilities into relevant maturity groupings based on their contractual maturities. The
amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances
as the impact of discounting is not significant.
76 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 27. Financial risk management (continued)
(c) Liquidity risk continued
Contractual maturities of the Group’s non-derivative financial liabilities were as follows:
30 June 2018
Trade and other payables
Borrowings²
Finance leases³
Deferred consideration
Total
30 June 2017
Trade and other payables
Borrowings
Finance leases
Deferred Consideration
Less than
6 months
$’000
6 - 12
months
$’000
Between
1 – 2 years
$’000
Between
2 – 5 years
$’000
5,803
1,100
1,057
636
8,596
7,677
1,886
904
460
-
1,082
1,057
636
2,775
-
13,390
929
497
-
17,130
2,345
1,226
20,701
143
2,027
1,224
1,172
4,566
-
9,033
1,906
3,775
14,714
-
25,142
2,623
3,620
31,385
Over
5 years
$’000
-
-
-
4,786
4,786
-
-
-
7,268
7,268
Total
$’000
5,803
28,345
6,365
11,059
51,572
7,820
42,445
5,680
13,017
68,962
Total
10,927
14,816
(d) Capital management
The Group’s capital includes contributed equity, reserves, and retained earnings. The Board’s policy is to maintain a strong capital base to
maintain investor, creditor, and market confidence and to sustain the future development of the business. There were no changes to the
Company’s approach to capital management during the year.
(e) Financial instruments by category
Financial Assets
Loans and receivables
Cash and cash equivalents
Restricted short-term deposits
Trade and other receivables
Loans to related parties
Other financial assets
Total
2018
$’000
20,179
4,037
3,903
-
139
28,258
2017
$’000
28,892
3,808
4,032
3,721
134
40,587
² Borrowings in this context represent the underlying contractual commitments on the USD denominated Subordinated Bonds and NZD convertible notes. The convertible notes
have the option to convert to equity, so future interest and principal repayments may not occur.
³ Total contractual cash flows equal minimum lease payments plus interest.
Section 2: Financial statements 77
27. Financial risk management (continued)
(e) Financial risks by category continued
Financial Liabilities
Amortised Cost
Trade and other payables
Borrowings
Fair Value
Deferred consideration
Derivative liabilities
Total
(f) Fair value measurements
2018
$’000
5,803
29,778
7,608
-
43,189
2017
$’000
7,820
34,037
7,928
17,809
67,594
Fair value is the price that would be received from the sale of an asset or paid to transfer a liability in a transaction between active market
participants or in its absence, the most advantageous market to which the Group has access to at the reporting date. The fair value of a
financial liability reflects its non-performance risk.
When available, fair value is measured using the quoted price in an active market. A market is active if transactions take place with
sufficient frequency and volume to provide pricing information on an ongoing basis. If there is no quoted price in an active market, then
the Group uses valuation techniques that maximise the use of relevant observable inputs and minimise the use of unobservable inputs.
The chosen valuation technique incorporates all of the factors that market participants would take into account in pricing a transaction.
The following fair value hierarchy, as set out in NZ IFRS 13: Fair Value Measurement, has been used to categorise the inputs to valuation
techniques used to measure the financial assets and financial liabilities which are carried at fair value:
(a) Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1)
(b) Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (as prices) or
indirectly (derived from prices) (level 2), and
(c) Inputs for the asset or liability that are not based on observable market data (unobservable inputs) (level 3).
The Group’s only financial asset or liability measured at a fair value hierarchy of level 3 is deferred consideration. This is discussed further
in note 20.
Debt instruments in note 18 are carried at amortised cost. Their fair values have been measured at a fair value hierarchy of level 2 as noted
below:
Instrument
Subordinated Bonds
Convertible Notes
2018
2017
Fair Value
$’000
Carrying Value
$’000
Fair Value
$’000
Carrying Value
$’000
12,175
12,652
11,689
12,193
10,812
10,413
10,733
10,428
All other assets and liabilities (except where specifically noted) have a carrying value that is equivalent to fair value.
78 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 28. Key management personnel
Key management personnel are the senior leadership team and directors (executive and non-executive) of the Group.
Key management personnel compensation
30 June 2018
Management
Directors
Total
30 June 2017
Management
Directors
Total
Short-term
benefits
$’000
Share-based
payments
$’000
2,172
196
2,368
2,032
247
2,279
684
110
794
82
144
226
Total
$’000
2,856
306
3,162
2,114
391
2,505
29. Commitments and contingent liabilities
(a) Capital commitments
There was no capital expenditure contracted for at the reporting date but not recognised as a liability (2017: Nil).
(b) Lease commitments
(i) Non-cancellable operating leases
The Group leases various offices, accommodations, and equipment under non-cancellable operating leases expiring within one to five
years. The leases have varying terms, escalation clauses and renewal rights. Commitments for non-cancellable minimum lease payments
are payable as follows:
Lease commitments
Within one year
Later than one year but not later than five years
Total lease commitments
(ii) Finance leases
2018
$’000
287
608
895
2017
$’000
123
40
163
The Group leases various plant and equipment expiring within one to five years. Refer to note 27 for further information.
(c) Exploration expenditure commitments
To maintain the various permits in which the Group is involved the Group has ongoing operational expenditure as part of its normal
operations. The actual costs will be dependent on a number of factors including final scope and timing of operations.
Section 2: Financial statements 79
29. Commitments and contingent liabilities (continued)
(d) Contingent assets and liabilities
On 23 December 2016 the Company announced that L&M Coal Holdings Limited had filed legal proceedings in the High Court of New
Zealand in relation to an alleged breach of the first USD$40m performance payment described in note 20. On 20 August 2018 the
Company advised that it received an unfavourable judgment from the High Court on this matter.
The Court held that the first performance payment had been triggered as royalties were not being paid on a reasonable level (undefined
by the Court) of production. The Company has lodged an appeal to the Court of Appeal against this decision and is also seeking a stay of
execution of the judgement. The Company believes that it is more likely than not that it will be successful in the Court of Appeal.
30. Events after the reporting period
Other than as disclosed below and in these financial statements, there are no other material events that occurred subsequent to reporting
date, that require recognition of, or additional disclosure in these financial statements.
(a) New joint venture with Jameson Resources Limited
On the 12 July 2018 the Company publicly announced the close of a new joint venture deal with Jameson Resources Limited (ASX:JAL).
The deal represents an eight percent equity investment in Jameson’s previously wholly owned Canadian subsidiary, NWP Coal Canada
Limited (“NWP”) and investment in NWP’s key asset, the Crown Mountain Coking Coal project.
On this same date, the Company made its first capital investment in NWP of CAD $4.0m. These funds are being used to fund the 2018
summer exploration programme. Up to the date of releasing these financial statements, the Company has made a further CAD $832k
investment in NWP in exchange for preference shares. These payments are being used to fund the bankable feasibility study and other
operating needs. Once a further CAD $7.5m investment has been reached, the preference shares will be converted to normal equity shares
of NWP.
The Company considers NWP to be a joint venture with Jameson. This is because unanimous approval is required on activities that
significantly affect NWP’s operations. As such NWP will be accounted for using the equity method in the 31 December 2018 financial
statements.
(b) Share buybacks
The Board approved an on-market share buyback on the 27 August 2018, as part of the Company’s ongoing capital management strategy.
Up to 75m ordinary shares will be bought back in the scheme, over a 12-month period beginning 28 August 2018.
80 Bathurst Resources Limited Annual Report 2018
Notes to the Financial StatementsFor the year ended 30 June 2018 Additional Information
For the year ended 30 June 2018
Unaudited proportionate consolidation presentation of Bathurst and BT Mining Operations
The below Income Statement, Balance Sheet and Cash flow represent 100% of Bathurst operations, and 65% of BT Mining operations.
This presentation does not reflect reporting under NZ GAAP or NZ IFRS, but is intended to show a combined operating view of the two
businesses for information purposes only.
Prior period comparatives are not provided, as BT Mining only began operating on 1 September 2017.
Consolidated Income Statement
Revenue
Less: cost of sales
Gross profit
Other income
Depreciation
Administrative and other expenses
Fair value loss on deferred consideration
Gain on disposal of fixed assets
Impairment losses
Operating profit before tax
Fair value movement on derivatives
Fair value movement on borrowings
Finance cost
Finance income
Profit before income tax
Income tax expense
Total profit after tax
2018
$’000
237,083
(133,981)
103,102
1,486
(6,545)
(17,855)
(5,684)
71
(1,630)
72,945
(27,687)
(4,434)
(12,699)
356
28,481
(22,933)
5,548
Section 2: Financial statements 81
Additional Information
For the year ended 30 June 2018
Consolidated Balance Sheet
ASSETS
Current assets
Cash and cash equivalents
Restricted short-term deposits
Trade and other receivables
Inventories
New Zealand emission units
Other financial assets
Total current assets
Non-current assets
Property, plant and equipment
Mining licences, properties, exploration and evaluation assets
Crown indemnity
Deferred tax asset
Other financial assets
Total non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Trade and other payables
Tax payable
Derivative liabilities
Borrowings
Deferred consideration
Provisions
Total current liabilities
Non-current liabilities
Borrowings
Deferred consideration
Provisions
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Debt instruments – equity component
Reserves
Accumulated losses
TOTAL EQUITY
82 Bathurst Resources Limited Annual Report 2018
2018
$’000
25,236
4,037
35,217
24,203
1,204
25
89,922
44,466
44,034
35,060
1,070
114
124,744
214,666
24,277
12,381
2,176
1,895
8,993
1,733
51,455
27,883
16,165
48,717
92,765
144,220
70,446
263,179
43,788
(31,837)
(204,684)
70,446
Consolidated Cash Flow
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Taxes paid
Net cash inflow from operating activities
Cash flows from investing activities
Exploration and consenting expenditure
Mining assets (including elevated stripping)
Property, plant and equipment purchases
Proceeds from disposal of property, plant and equipment
Restricted deposits
Payment of deferred consideration
BT Mining repayment of opening loan balance to the Company
Other
Net cash outflow from investing activities
Cash flows from financing activities
Proceeds from borrowings
Repayment of borrowings
Interest on debt instruments
Interest received
Interest paid
Finance facility fees
Net cash outflow from financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
2018
$’000
209,945
(143,755)
(11,621)
54,569
(337)
(21,696)
(30,666)
92
(230)
(5,159)
4,290
59
(53,647)
20,070
(21,578)
(3,036)
402
(555)
(150)
(4,847)
(3,926)
29,162
25,236
Section 2: Financial statements 83
84 Bathurst Resources Limited Annual Report 2018
© 2018 KPMG, a New Zealand partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. Independent Auditor’s Report To the shareholders of Bathurst Resources Limited Report on the consolidated financial statements Opinion In our opinion, the accompanying consolidated financial statements of Bathurst Resources Limited (the company) and its subsidiaries (the group) on pages 45 to 80: i. present fairly in all material respects the Group’s balance sheet as at 30 June 2018 and its financial performance and cash flows for the year ended on that date; and ii. Comply with New Zealand Equivalents to International Financial Reporting Standards and International Financial Reporting Standards. We have audited the accompanying consolidated financial statements which comprise: — the consolidated balance sheet as at 30 June 2018; — the consolidated income statement, statements of other comprehensive income, changes in equity and cash flows for the year then ended; and — notes, including a summary of significant accounting policies and other explanatory information. Basis for opinion We conducted our audit in accordance with International Standards on Auditing (New Zealand) (‘ISAs (NZ)’). We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. We are independent of the group in accordance with Professional and Ethical Standard 1 (Revised) Code of Ethics for Assurance Practitioners issued by the New Zealand Auditing and Assurance Standards Board and the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (‘IESBA Code’), and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. Our responsibilities under ISAs (NZ) are further described in the auditor’s responsibilities for the audit of the consolidated financial statements section of our report. Other than in our capacity as auditor we have no relationship with, or interests in, the group. Scoping The scope of our audit is designed to ensure that we perform adequate work to be able to give an opinion on the consolidated financial statements as a whole, taking into account the structure of the group, the financial reporting systems, processes and controls, and the industry in which it operates. The context for our audit is set by the group's major activities in the financial year ended 30 June 2018. In August 2017 the Group completed through its material equity accounted joint venture the acquisition of certain Solid Energy New Zealand mining assets. The consolidated financial statements includes the material equity accounted profit share for the period which is significant to the Group as a whole and was a focus of our audit for the year ended 30 June 2018. Section 2: Financial statements 85
Emphasis of matter – prior year restatement We draw attention to note 1(Y) in the consolidated financial statements. Management restated the prior year financial statements where the conversion feature of the convertible notes was treated as equity instead of a derivative liability, to adopt the treatment as defined by IFRIC Update April 2005. As part of our audit of the 30 June 2018 financial statements audit, we audited the adjustments described in note 1(Y) that were applied to amend the 30 June 2017 financial statements. In our opinion, such adjustments are appropriate and have been properly applied. Our opinion is not modified in respect of this matter. Emphasis of matter – contingent liabilities We draw attention to note 29(d) in the consolidated financial statements which discloses the unfavorable judgement received in relation to legal proceedings in the High Court of New Zealand filed by L&M Coal Holdings Limited. The company has lodged an appeal to the Court of Appeal against the decision and is also seeking a stay of execution of the judgement. No liability has been recognised as at 30 June 2018 based on legal advice that it is more likely than not that the company will be successful in the Court of Appeal. Our opinion is not modified in respect of this matter. Materiality The scope of our audit was influenced by our application of materiality. Materiality helped us to determine the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually and on the consolidated financial statements as a whole. The materiality for the consolidated financial statements as a whole was set at $2,400,000 determined with reference to a benchmark of group’s profit before tax from continuing operations, adjusted for financial instrument fair value movements and interest costs. We chose the benchmark because, in our view, this is a key measure of the group’s performance Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements in the current period. We summarise below those matters and our key audit procedures to address those matters in order that the shareholders as a body may better understand the process by which we arrived at our audit opinion. Our procedures were undertaken in the context of and solely for the purpose of our statutory audit opinion on the consolidated financial statements as a whole and we do not express discrete opinions on separate elements of the consolidated financial statements. 86 Bathurst Resources Limited Annual Report 2018
The key audit matter How the matter was addressed in our audit Deferred considerations Refer to note 20 to the Financial Report. The fair value of the deferred consideration in respect of previous mine acquisitions was $7.6 million at 30 June 2018. The equity accounted joint venture BT Mining Limited includes deferred consideration of $27 million. Significant judgment is applied by in relation to key inputs into the discounted cash flow models (models) to estimate the fair value of deferred consideration. Key inputs include estimated coal production level, future coal prices, the timing of cash flows and a discount rate based on the risk free rate plus a mine-specific risk premium to reflect the risk that is not incorporated into the estimated future cash flows. This was an area of audit focus because of the estimation uncertainties and significant judgements applied by Management in estimating future coal prices, production levels and timing of cash flows and the sensitivities to be disclosed. Our audit procedures over Management’s calculation of its estimate of the future deferred consideration payable included the following: — Sighting the sale and purchase agreements and agreeing the terms of the deferred consideration obligations related to each mine. — Testing the mathematical accuracy of the models used by Management to calculate the estimated future deferred consideration payable. — Comparing the forecasted coal production to operational data and reserve estimates prepared by the Company’s internal reserve engineering experts. — Assessing Management’s production forecasting accuracy by comparing forecasts to actual results. — Comparing the forecasted coal price assumption with current prices charged to the Company’s largest customers and a growth rate based on historic achieved growth rates and external forecast coal prices. — Performing sensitivity analysis on the key estimates and assumptions including the risk adjusted discount rate, forecast coal price and estimated production. — Assessing whether the Group’s disclosures in relation to deferred consideration and the sensitivities of key assumptions were appropriate in the financial statements. Modification of convertible notes Refer to note 1(Y) to the Financial Report. On 31 December 2017 the terms of the convertible notes were modified so that they were denominated in NZD and would convert to a fixed number of shares. The modification means the conversion feature of the convertible notes is no longer classified as a derivative liability but as a component of equity. This was an area of audit focus because of the complexity in calculating the fair value on de-recognition and subsequent recognition, and the significant impact the modification has on the financial statements. As part of our audit procedures we obtained the modified convertible note agreements and reviewed the fair value adjustments recorded by Management to derecognise the existing derivative liability and recognise the fair value of the new equity component. In particular our audit procedures focused on; — Agreeing the terms of the modifed convertaible notes to underlying agreements. — Using our valuation specialists to assist in; — assessing whether the modifed terms were considered a signifcant modifcation that required the derecognition of the existing derivative liability; — asssessing whether the modifed terms meant that the conversion feature of the convertiable notes was approriatley classifed as an equity component; and Section 2: Financial statements 87
The key audit matter How the matter was addressed in our audit — independently recalculating the fair value of the convertiable notes derecongised on modification and the related fair value of the equity component recognsied on modifictaion. Acquisition of assets by the equity accounted investment Refer to note 15 to the Financial Report. The acquisition of the Solid Energy New Zealand mining assets and mining permits occurred on 31 August 2017. Judgment was exercised by management in estimating the fair value of the mining assets and permits acquired by BT Mining, a jointly controlled and equity accounted entity in the consolidated financial statements. This was an area of audit focus because of the significant judgements applied by management. As part of our audit procedures over the acquisition by BT Mining of certain assets from Solid Energy New Zealand Limited we obtained key transaction documents, assessed the date of acquisition and reviewed the fair value estimates of the assets and liabilities acquired. In particular our audit procedures focussed on significant judgements made by directors, including; — Validating that the substantive conditions that existed within the sale and purchase agreements were appropriately satisfied and control was effective on 31 August 2017; — Using our valuation specialists, reviewing the key assumptions set out in the external advisors report that supported the fair value of the assets and liabilities acquired. Other information The Directors, on behalf of the group, are responsible for the other information included in the entity’s Annual Report. Other information includes the Chairman’s and Chief Executive’s report and operational and financial reviews. Our opinion on the consolidated financial statements does not cover any other information and we do not express any form of assurance conclusion thereon. The Annual Report is expected to be made available to us after the date of this Independent Auditor's Report. Our responsibility is to read the Annual Report when it becomes available and consider whether the other information it contains is materially inconsistent with the consolidated financial statements, or our knowledge obtained in the audit, or otherwise appear misstated. If so, we are required to report such matters to the Directors. Other matter The consolidated financial statements of the group, for the year ended 30 June 2017, were audited by another auditor who expressed a qualified opinion on those statements on 31 August 2017. Use of this independent auditor’s report This independent auditor’s report is made solely to the shareholders as a body. Our audit work has been undertaken so that we might state to the shareholders those matters we are required to state to them in the independent auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the shareholders as a body for our audit work, this independent auditor’s report, or any of the opinions we have formed. 88 Bathurst Resources Limited Annual Report 2018
Responsibilities of the Directors for the consolidated financial statements The Directors, on behalf of the company, are responsible for: — the preparation and fair presentation of the consolidated financial statements in accordance with generally accepted accounting practice in New Zealand (being New Zealand Equivalents to International Financial Reporting Standards) and International Financial Reporting Standards; — implementing necessary internal control to enable the preparation of a consolidated set of financial statements that is fairly presented and free from material misstatement, whether due to fraud or error; and — assessing the ability to continue as a going concern. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless they either intend to liquidate or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the consolidated financial statements Our objective is: — to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error; and — to issue an independent 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 ISAs NZ will always detect a material misstatement when it exists. Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements. A further description of our responsibilities for the audit of these consolidated financial statements is located at the External Reporting Board (XRB) website at: http://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-report-1/ This description forms part of our independent auditor’s report. The engagement partner on the audit resulting in this independent auditor's report is David Gates. For and on behalf of KPMG Wellington 27 August 2018 Section 2: Financial statements 89
90 Bathurst Resources Limited Annual Report 2018
Section 3: Shareholder information 91
Shareholder informationIn this sectionShareholder information03 Shareholder information
Additional information required by the Australian Securities Exchange (ASX)
and not shown elsewhere in the Annual Report, current as at 28 September 2018,
is advised hereunder.
Stock exchange quotation
The Company’s shares are quoted on the ASX under the code “BRL”.
Classes of securities
The Company has the following equity securities on issue:
Quoted
Ordinary shares, each fully paid
1,595,952,455
3,437
Number on issue
Number of holders
Unquoted
Convertible notes of NZD $1,150, converting to 45,455
shares per note, maturing 22 July 2019
Convertible notes of NZD $1,150, converting to 26,667
shares per note, maturing 1 February 2021
Transaction performance rights exercisable at $nil up to
31 March 2019
Completion performance rights exercisable at $nil up to
31 March 2019
Retention performance rights exercisable at $nil up to
31 March 2019
2,483
6,100
11,500,000
1,980,559
2,650,000
2
9
4
2
4
Voting rights
Only holders of ordinary shares have voting rights. These are set out in Clause 21 of the Company’s Constitution and are summarised
as follows:
• Where voting is by show of hands or by voice, every Shareholder present in person or by proxy or Representative has one vote.
• On a poll every Shareholder present in person or by proxy or Representative has, in respect of each fully paid Share held by that
Shareholder, one vote.
Holders of convertible notes and performance rights have no voting rights until they are converted/exercised into ordinary shares.
92 Bathurst Resources Limited Annual Report 2018
Restricted securities
There are no restricted securities or securities subject to voluntary escrow.
On-market buybacks
An on-market share buyback was announced on 28 August 2018. The buyback will be for up to a maximum of 75 million shares,
representing approximately 4.70 percent of the ordinary shares on issue at that date. The buyback will run for a period of 12 months.
No shares have been bought back as at 28 September 2018.
Distribution of quoted equity securities
Analysis of the numbers of holders of ordinary shares by size of holding:
Holding range
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
TOTAL
Total shareholders
Ordinary shares
335
587
428
1,445
642
3,437
51,398
1,558,684
2,839,217
45,145,100
1,546,358,056
1,595,952,455
There are 893 shareholders holding less than a marketable parcel of ordinary shares as determined by the ASX (A$500) based on the
closing price of A$0.11 per share on 28 September 2018.
Substantial holders
Holders of 5 percent or more ordinary shares as disclosed in substantial holding notices given to the Company as of 28 September 2018:
Republic Investment Management Pte Limited
Asian Dragon Acquisitions Limited
Chng Seng Chye
Number held
Percentage of issued shares
317,414,951
151,611,069
106,561,841
19.89%
10.02%
6.68%
At the special meeting of shareholders held on 23 June 2016, the shareholders approved the issue of up to 90,909,091 shares to
Republic Investment Management (“RIM”) upon conversion of the convertible notes described in the notice of meeting (“July 2016
Notes”). Pursuant to this approval, on 22 July 2016, RIM was issued with 2,150 July 2016 Notes, of which 293 have subsequently
converted to shares.
RIM still holds 1,857 July 2016 Notes which, if converted, will convert into 84,409,091 ordinary shares. This would give RIM a maximum
holding of 24.0 percent of the voting rights, based on the current issued shares.
Section 3: Shareholder information 93
Corporate governance statement
The Corporate Governance Statement is available on the Company’s website at www.bathurst.co.nz
Twenty largest shareholders
The names, numbers and percentages of the twenty largest holders of quoted equity securities are listed below:
Shareholding name
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
CITICORP NOMINEES PTY LIMITED
CHNG SENG CHYE
JP MORGAN NOMINEES AUSTRALIA LIMITED
TH INVESTMENTS PTE LIMITED
TEO PENG KWANG
BERNE NO 132 NOMINEES PTY LTD <608725 A/C>
ARMADA TRADING PTY LTD
ANG POON LIAT
JOHN MCCALLUM
BNP PARIBAS NOMINEES PTY LTD
KARAMJIT SINGH NARULA
NATIONAL NOMINEES LIMITED
FORSYTH BARR CUSTODIANS LIMITED
BNP PARIBAS NOMS PTY LTD
NATIONAL NOMINEES LIMITED
DBS VICKERS SECURITIES (SINGAPORE) PTE LTD
ROBERT JAMES GRIFFITHS + JEAN DARLING GRIFFITHS
RICHARD TACON
CHOW SHOOK LIN
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
Total top 20 shareholders
Total remaining shareholders
Number of
shares held
624,427,161
105,472,291
91,878,788
51,937,471
45,454,545
38,932,124
27,888,773
24,114,272
22,002,727
20,392,966
19,689,309
18,181,818
17,607,563
17,384,817
15,240,020
13,259,045
11,363,636
10,900,000
9,687,960
9,090,909
1,194,906,195
401,046,260
Percentage of
issued shares
39.13
6.61
5.76
3.25
2.85
2.44
1.75
1.51
1.38
1.28
1.23
1.14
1.10
1.09
0.95
0.83
0.71
0.68
0.61
0.57
74.87
25.13
94 Bathurst Resources Limited Annual Report 2018
Section 3: Shareholder information 95
96 Bathurst Resources Limited Annual Report 2018
Section 4: Resources and reserves 97
Resources and reservesIn this sectionTenement scheduleCoal resources and reservesCorporate directory04 Tenement schedule
At 30 June 2018
Permit Id
Location (Region)
Minerals
Permit Type
Permit Operator
Bathurst Interest
60194
Canterbury
60146
Waikato
60047
West Coast
56233
West Coast
56220
Waikato
Coal
Coal
Coal
Coal
Coal
Exploration Permit
Bathurst Coal Limited
Exploration Permit
BT Mining Limited
Exploration Permit
Bathurst Coal Limited
Mining Permit
Buller Coal Limited
Exploration Permit
BT Mining Limited
55401
West Coast
Minerals
Mining Permit
Buller Coal Limited
54846
Canterbury
53614
Southland
52937
West Coast
51279
West Coast
51260
Southland
41821
Waikato
41810
West Coast
41456
West Coast
41455
West Coast
41372
Canterbury
41332
West Coast
41274
West Coast
40698
Waikato
40628
West Coast
40625
Southland
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Exploration Permit
Bathurst Coal Limited
Mining Permit
Bathurst Coal Limited
Mining Permit
BT Mining Limited
Mining Permit
Buller Coal Limited
Exploration Permit
Bathurst Coal Limited
Mining Permit
BT Mining Limited
Mining Permit
BT Mining Limited
Mining Permit
Buller Coal Limited
Mining Permit
Bathurst Coal Limited
Mining Permit
Bathurst Coal Limited
Mining Permit
Buller Coal Limited
Mining Permit
Buller Coal Limited
Exploration Permit
BT Mining Limited
Exploration Permit
Buller Coal Limited
Exploration Permit
New Brighton Collieries
Limited
100%
65%
100%
100%
65%
100%
100%
100%
65%
100%
100%
65%
65%
100%
100%
100%
100%
100%
65%
100%
100%
98 Bathurst Resources Limited Annual Report 2018
Permit Id
Location (Region)
Minerals
Permit Type
Permit Operator
Bathurst Interest
40591
West Coast
37161
West Coast
3716101
West Coast
3716102
West Coast
3716103
West Coast
3716104
West Coast
37155
Waikato
3715501
Waikato
37153
Waikato
3715301
Waikato
37150
West Coast
3715002
West Coast
3715003
West Coast
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Coal
Exploration Permit
Bathurst Coal Limited
100%
Ancillary Coal Mining
Licence
Ancillary Coal Mining
Licence
Ancillary Coal Mining
Licence
Ancillary Coal Mining
Licence
Ancillary Coal Mining
Licence
Bathurst Coal Limited
100%
Bathurst Coal Limited
100%
Bathurst Coal Limited
100%
Bathurst Coal Limited
100%
Bathurst Coal Limited
100%
Coal Mining Licence
BT Mining Limited
Ancillary Coal Mining
Licence
BT Mining Limited
Coal Mining Licence
BT Mining Limited
Ancillary Coal Mining
Licence
BT Mining Limited
Coal Mining Licence
BT Mining Limited
Ancillary Coal Mining
Licence
Ancillary Coal Mining
Licence
BT Mining Limited
BT Mining Limited
65%
65%
65%
65%
65%
65%
65%
Section 4: Resources and reserves 99
Bathurst Resources permitting changes 1 July 2017 – 30 June 2018
Permit applications in past 12 months
Permit Id
Permit Type
Operator
60400
Mining Permit
New Brighton
Collieries Limited
Location
(Region)
Applied Date
Permit Name
Bathurst
Interest
Southland
01.09.2017
New Brighton
100%
60422
Mining Permit
BT Mining Limited
Waikato
06.11.2017
Awaroa West
65%
54846
40698
Exploration
Permit –
Extension
of Duration
Application
Exploration
Permit –
Extension
of Duration
Application
Bathurst Coal
Limited
Canterbury
29.11.2017
Albury
100%
BT Mining Limited
Waikato
08.05.2018
Ruawaro
65%
Permits granted in past 12 months
None
Full Surrender
Permit Id
Permit Type
Operator
Location
(Region)
Permit Name
Bathurst
Interest
57205
Exploration Permit
Bathurst Coal Limited
West Coast
Caroline Terrace
100%
Expired
Permit Id
Permit Type
Operator
Location
(Region)
Permit Name
Bathurst
Interest
56927
Prospecting Permit
Bathurst Coal Limited
Southland
Ohai Metals
100%
100 Bathurst Resources Limited Annual Report 2018
Coal resources
and reserves
Resources
Table 1 – Resource tonnes
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100%
3.4
3.1
0.3
2.2
2.1
0.1
1.1
1.0
0.1
6.7
6.2
0.5
100%
0.5
0.5
0.0
0.6
0.6
0.0
0.3
0.3
0.0
1.4
1.4
0.0
100%
6.2
6.2
0.0
3.1
3.1
0.0
1.6
1.6
0.0
10.9
10.9
0.0
100%
0.0
0.0
0.0
3.4
3.8
(0.4)
4.7
5.4
(0.7)
8.1
9.2
(1.1)
100%
7.9
7.6
0.3
11.2
10.8
0.4
4.8
4.9
(0.1)
23.9
23.3
0.6
100%
2.7
0.0
2.7
5.1
0.0
5.1
4.1
0.0
4.1
11.9
0.0
11.9
100%
20.7
17.4
3.3
25.6
20.4
5.2
16.6
13.2
3.4
62.9
51.0
11.9
65%
0.9
1.0
(0.1)
10.2
11.0
(0.8)
7.5
7.5
0.0
18.6
19.4
(0.8)
65%
0.5
0.6
(0.1)
13.2
13.8
(0.6)
33.4
33.9
(0.5)
47.1
48.3
(1.2)
65%
0.1
0.0
0.1
1.0
0.6
0.4
1.4
0.9
0.5
2.5
1.5
1.0
65%
1.5
1.6
(0.1)
24.4
25.4
(1.0)
42.3
42.3
0.0
68.2
69.2
(1.0)
Area
Escarpment
(1 & 9)
Cascade
(1)
Deep Creek
(1 & 3)
Coalbrookdale
(1 & 9)
Whareatea
West
(1 & 9)
Sullivan
(9)
South Buller
Totals
(7)
Stockton
(2, 5 & 6)
Upper
Waimangaroa
(Met)
(2, 5 & 6)
Upper
Waimangaroa
(Thermal)
(2, 5 & 6)
Stockton
Totals
Section 4: Resources and reserves
101
Resources (continued)
Table 1 – Resource tonnes continued
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e
f
n
I
7
1
0
2
)
t
M
(
e
c
r
u
o
s
e
R
)
t
M
(
e
g
n
a
h
C
)
t
M
(
e
c
r
u
o
s
e
R
l
a
t
o
T
8
1
0
2
)
t
M
(
e
c
r
u
o
s
e
R
l
a
t
o
T
7
1
0
2
)
t
M
(
e
g
n
a
h
C
100%
0.0
0.0
0.0
1.9
1.9
0.0
3.6
3.6
0.0
5.5
5.5
0.0
Area
Millerton
North
(1 & 3)
North Buller
100%
2.4
2.4
0.0
7.3
7.3
0.0
10.9
10.9
0.0
20.6
20.6
0.0
Blackburn
(1 & 3)
North Buller
Totals
(7)
Buller Coal
Project Totals
Takitimu
(1 & 4)
New Brighton
(1)
Albury
(1 & 10)
Canterbury
Coal
(1 & 4)
Southland/
Canterbury
Totals
(7)
Rotowaro
(2, 4 & 6)
Maramarua (2,
6 & 8)
North Island
Totals
100%
0.0
0.0
0.0
5.8
5.8
0.0
14.1
14.1
0.0
19.9
19.9
0.0
100%
2.4
2.4
0.0
15.0
15.0
0.0
28.6
28.6
0.0
46.0
46.0
0.0
24.6
21.4
3.2
65.0
60.8
4.2
87.5
84.1
3.4
177.1
166.2
10.9
100%
0.9
0.9
0.0
1.6
2.0
(0.4)
0.2
0.5
(0.3)
2.7
3.4
(0.7)
100%
0.2
0.2
0.0
0.4
0.4
0.0
1.3
1.3
0.0
1.9
1.9
0.0
100%
0.0
0.0
0.0
0.7
0.0
0.7
0.1
0.0
0.1
0.8
0.0
0.8
100%
1.4
1.2
0.2
2.5
2.5
0.0
3.2
3.4
(0.2)
7.1
7.1
0.0
100%
2.5
2.3
0.2
5.2
4.9
0.3
4.8
5.2
(0.4)
12.5
12.4
0.1
65%
2.4
2.8
(0.4)
5.0
5.1
(0.1)
1.5
1.8
(0.3)
8.9
9.7
(0.8)
65%
1.7
4.7
(3.0)
1.5
0.8
0.7
0.0
0.0
0.0
3.2
5.5
(2.3)
65%
4.1
7.5
(3.4)
6.5
5.9
0.6
1.5
1.8
(0.3)
12.1
15.2
(3.1)
Total
31.2
31.2
0.0
76.7
71.6
5.1
93.8
91.1
2.7
201.7
193.8
7.9
All resources and reserves quoted in this release are reported in terms as defined in the 2004 and 2012 Editions of the ‘Australasian Code for Reporting
of Exploration Results, Mineral Resources and Ore Reserves’ as published by the Joint Ore Reserves Committee of the Australasian Institute of Mining
and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia (“JORC”).
The Measured and Indicated Mineral Resources are inclusive of those Mineral Reserves modified to produce the Ore Reserves. Rounding of tonnes as required
by reporting guidelines may result in summation differences between tonnes and coal quality. All resources quoted are reported as of 30 June 2018.
1 Resource tonnages have been calculated using a density value calculated using approximated in-ground moisture values (Preston and Sanders
method) and as such tonnages quoted in this report are wet tonnes (unless stipulated otherwise). All coal qualities quoted are on an Air-Dried Basis.
2 Stockton, Upper Waimangaroa and Maramarua density values are based on air-dried ash density regressions. Stockton, Upper Waimangaroa,
Rotowaro and Maramarua are reported on an air-dried basis.
3 No additional work has been undertaken on the coal resources for Deep Creek, Millerton North and Blackburn since originally reported. This
information was prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with the JORC Code 2012 on the
basis that the information has not materially changed since it was last reported.
4 Rotowaro, Canterbury Coal and Takitimu changes are due to an updated geology model and mining depletion.
102 Bathurst Resources Limited Annual Report 2018
Table 1 – Resource tonnes continued
5 Resources were depleted by mining.
6 Stockton, Upper Waimangaroa, Rotowaro and Maramarua are owned by BT Mining Limited.
7 South Buller, North Buller, Sullivan, Southland and Canterbury Resources are 100 percent Bathurst Resources Limited ownership.
8 Significant updates to geological model and review and update of the resource shell geotechnical parameters.
9 Updated geology model with significant new data provided with the purchase of the Sullivan Licence. Sullivan is a new resource following the
purchase of the mining licence from Solid Energy.
10 New resource.
Table 2 – Average coal quality – measured
p
i
h
s
r
e
n
w
O
t
s
r
u
h
t
a
B
l
a
r
e
n
M
i
d
e
r
u
s
a
e
M
e
c
r
u
o
s
e
R
)
t
M
(
%
r
u
h
p
l
u
S
)
D
A
(
%
r
e
t
t
a
M
e
l
i
t
a
l
o
V
)
D
A
(
%
n
o
b
r
a
C
d
e
x
i
F
)
D
A
(
0.7
1.7
2.5
-
0.8
1.1
2.4
1.1
33.0
39.3
32.9
-
49.3
42.6
53.9
-
24.0
50.4
32.1
31.6
52.9
59.5
39.0
53.4
N
S
C
7.0
4.5
-
-
7.0
7.0
7.8
4.0
%
h
s
A
)
D
A
(
16.8
15.5
11.0
-
24.9
13.8
7.9
3.0
3.4
0.5
6.2
0.0
7.9
2.7
0.9
0.5
65%
0.1
11.5
1.2
36.0
47.9
3.5
4.5
0.0
2.4
0.0
0.9
0.2
0.0
1.4
2.4
1.7
-
8.6
-
11.2
10.7
-
9.7
5.8
5.2
-
4.7
-
0.3
0.4
-
0.9
0.3
0.2
-
-
43.1
45.4
-
36.9
35.9
-
-
36.6
39.1
-
34.6
39.1
44.0
37.8
36.3
38.4
-
4.5
-
N/A
N/A
-
N/A
N/A
N/A
Coalbrookdale
100%
Area
Escarpment
Cascade
Deep Creek
Whareatea
West
Sullivan
Stockton
Upper
Waimangaroa
(Met)
Upper
Waimangaroa
(Thermal)
Millerton
North
North Buller
Blackburn
Takitimu
100%
100%
100%
100%
100%
65%
65%
100%
100%
100%
100%
New Brighton
100%
Albury
Canterbury
Coal
Rotowaro
Maramarua
100%
100%
65%
65%
t
n
e
r
e
h
n
I
e
r
u
t
s
i
o
M
e
r
u
t
s
i
o
M
u
t
i
S
n
I
)
D
A
(
e
u
l
a
V
c
i
f
i
r
o
l
a
C
28.6
30.8
29.7
-
26.5
29.7
32.6
28.6
26.0
-
5.6
7.6
5.2
-
6.3
6.6
-
-
-
-
1.0
2.6
2.2
-
0.6
1.2
1.0
4.6
-
2.9
-
15.3
14.3
-
11.4
29.7
-
25.1
21
-
-
21.3
22.7
-
16.8
25.7
22.6
13.9
18.6
-
-
25.5
22.5
Section 4: Resources and reserves
103
Resources (continued)
Table 3 – Average coal quality – indicated
p
i
h
s
r
e
n
w
O
t
s
r
u
h
t
a
B
l
a
r
e
n
M
i
d
e
t
a
c
i
d
n
I
e
c
r
u
o
s
e
R
)
t
M
(
100%
100%
100%
100%
2.2
0.6
3.1
3.4
%
h
s
A
)
D
A
(
12.6
14.8
9.7
12.0
100%
11.2
28.5
100%
65%
5.1
10.2
15.3
5.4
65%
13.2
4.2
Area
Escarpment
Cascade
Deep Creek
Coalbrookdale
Whareatea
West
Sullivan
Stockton
Upper
Waimangaroa
(Met)
Upper
Waimangaroa
(Thermal)
65%
Millerton North
100%
North Buller
Blackburn
Takitimu
New Brighton
Albury
Canterbury
Coal
Rotowaro
Maramarua
100%
100%
100%
100%
100%
100%
65%
65%
1.0
1.9
7.3
5.8
1.6
0.4
0.7
2.5
5.0
1.5
8.4
9.7
8.8
3.9
8.2
9.0
7.2
9.4
5.9
5.6
%
r
u
h
p
l
u
S
)
D
A
(
%
r
e
t
t
a
M
e
l
i
t
a
l
o
V
)
D
A
(
%
n
o
b
r
a
C
d
e
x
i
F
)
D
A
(
N
S
C
7.5
4.0
-
5.0
6.0
7.0
8.0
5.1
34.9
38.3
34.7
35.9
51.4
44.5
53.6
50.4
22.3
48.5
30.6
36.3
53.0
57.0
39.0
53.8
37.0
50.4
1.4
36.9
42.6
42.1
35.9
35.9
30.9
52.4
46.3
51.8
40.0
42.1
24.5
35.1
38.7
44.0
37.4
41.3
36.0
10.0
5.0
6.0
N/A
N/A
N/A
N/A
N/A
N/A
1.2
1.8
2.7
1.8
1.1
1.2
3.4
1.9
2.8
4.9
5.1
4.3
0.3
0.3
1.0
1.0
0.3
0.2
t
n
e
r
e
h
n
I
e
r
u
t
s
i
o
M
e
r
u
t
s
i
o
M
u
t
i
S
n
I
1.2
2.4
2.0
1.7
0.7
1.2
1.0
3.5
4.1
1.0
2.3
2.2
16.0
12.9
37.4
5.5
8.0
4.8
5.6
6.3
6.6
-
-
-
6.1
9.4
10.1
25.5
20.5
41.2
)
D
A
(
e
u
l
a
V
c
i
f
i
r
o
l
a
C
30.0
29.3
30.3
29.8
25.0
29.3
33.4
28.9
27.2
31.1
30.0
30.4
21.8
23.7
15.6
16.8
26.1
22.7
14.0
18.6
-
-
24.5
22.5
104 Bathurst Resources Limited Annual Report 2018
Table 4 – Average coal quality – inferred
p
i
h
s
r
e
n
w
O
t
s
r
u
h
t
a
B
l
a
r
e
n
M
i
e
c
r
u
o
s
e
R
d
e
r
r
e
f
n
I
)
t
M
(
100%
100%
100%
100%
100%
100%
65%
1.1
0.3
1.6
4.7
4.8
4.1
7.5
%
h
s
A
)
D
A
(
12.5
16.5
10.1
12.7
29.5
16.0
6.3
65%
33.4
5.7
65%
1.4
7.4
Area
Escarpment
Cascade
Deep Creek
Coalbrookdale
Whareatea
West
Sullivan
Stockton
Upper
Waimangaroa
(Met)
Upper
Waimangaroa
(Thermal)
Millerton North
100%
North Buller
Blackburn
Takitimu
New Brighton
Albury
Canterbury
Coal
Rotowaro
Maramarua
100%
100%
100%
100%
100%
100%
65%
65%
3.6
10.9
14.1
0.2
1.3
0.1
3.2
1.5
0.0
12.0
9.9
6.4
10.6
9.0
7.3
9.9
5.7
-
%
r
u
h
p
l
u
S
)
D
A
(
%
r
e
t
t
a
M
e
l
i
t
a
l
o
V
)
D
A
(
%
n
o
b
r
a
C
d
e
x
i
F
)
D
A
(
N
S
C
7.0
4.0
-
5.0
6.0
6.5
7.5
4.6
35.2
36.7
29.7
35.7
51.0
44.7
57.8
49.8
22.0
47.8
30.5
35.3
52.3
57.0
38.7
52.5
35.4
49.2
2.9
35.3
45.6
41.8
36.2
35.7
30.2
51.6
42.3
49.5
37.4
43.6
23.4
35.3
38.2
43.2
42.2
-
-
9.0
5.0
6.0
N/A
N/A
N/A
N/A
N/A
-
1.6
2.2
2.4
1.8
0.9
1.1
3.4
2.0
1.8
5.5
5.1
4.8
0.3
0.3
0.8
1.3
0.3
-
t
n
e
r
e
h
n
I
e
r
u
t
s
i
o
M
e
r
u
t
s
i
o
M
u
t
i
S
n
I
1.3
2.1
2.4
1.8
0.7
1.2
1.0
3.6
5.7
1.1
2.2
2.3
15.9
11.6
39.1
5.4
6.7
7.1
5.7
6.4
6.5
-
-
-
7.2
9.6
11.2
25.3
19.6
43.1
)
D
A
(
e
u
l
a
V
c
i
f
i
r
o
l
a
C
29.9
27.6
29.7
29.5
24.5
29.1
33.1
28.5
27.1
30.2
29.5
30.1
21.1
24.1
15.6
16.6
26.4
22.6
14.0
-
-
-
24.3
-
Section 4: Resources and reserves
105
Reserves
Table 5 – Coal reserves (ROM) tonnes
ROM Coal
Area
Escarpment
Domestic
(11, 13, 16 & 18)
Escarpment
Export
(11,13, 16 & 18)
Whareatea
West
(11, 13, 16 & 18)
Stockton
(12, 13, 15 & 17)
Upper
Waimangaroa
(Met)
(12, 13, 15 & 17)
Takitimu
(11, 13, 14, 16
& 18)
Canterbury
Coal
(11, 13,15, 16 & 18)
Rotowaro
(12, 13, 17 & 19)
Maramarua
(12, 13, 15 & 17)
Total
Bathurst
Mineral
Ownership
Proved (Mt)
Probable (Mt)
Total (Mt)
2018
2017
Change
2018
2017
Change
2018
2017
Change
100%
0.2
0.2
0.0
0.1
0.1
0.0
0.3
0.3
0.0
100%
2.3
2.3
0.0
0.5
0.5
0.0
2.8
2.8
0.0
100%
0.0
0.0
0.0
15.8
15.8
0.0
15.8
15.8
0.0
65%
0.7
0.8
(0.1)
7.2
8.0
(0.8)
7.9
8.8
(0.9)
65%
0.5
0.6
(0.1)
2.8
2.9
(0.1)
3.3
3.5
(0.2)
100%
0.4
0.5
(0.1)
1.1
1.3
(0.2)
1.5
1.8
(0.3)
100%
0.6
0.5
0.1
0.8
1.1
(0.3)
1.4
1.6
(0.2)
65%
65%
0.6
1.5
6.8
0.5
3.1
8.5
0.1
(1.6)
1.9
1.4
1.5
0.1
(1.7)
31.6
31.3
0.4
1.3
0.3
2.5
2.0
0.5
2.9
3.2
(0.3)
38.4
39.8
(1.4)
106 Bathurst Resources Limited Annual Report 2018
Table 6 – Marketable coal reserves tonnes
Product
Coal Area
Escarpment
Domestic
(11, 13, 16 & 18)
Escarpment
Export
(11,13, 16 & 18)
Whareatea
West
(11, 13, 16 & 18)
Stockton
(12, 13, 15 & 17)
Upper
Waimangaroa
(Met)
(12, 13, 15 & 17)
Takitimu
(11, 13, 14, 16
& 18)
Canterbury
Coal
(11, 13,15, 16 & 18)
Rotowaro
(12, 13, 17 & 19)
Maramarua
(12, 13, 15 & 17)
Total
Bathurst
Mineral
Ownership
Proved (Mt)
Probable (Mt)
Total (Mt)
2018
2017
Change
2018
2017
Change
2018
2017
Change
100%
0.2
0.2
0.0
0.1
0.1
0.0
0.3
0.3
0.0
100%
1.9
1.9
0.0
0.4
0.4
0.0
2.3
2.3
0.0
100%
0.0
0.0
0.0
9.9
9.9
0.0
9.9
9.9
0.0
65%
0.6
0.6
0.0
5.7
6.2
(0.5)
6.2
6.9
(0.7)
65%
0.5
0.5
0.0
2.6
2.7
(0.1)
3.1
3.2
(0.1)
100%
0.3
0.5
(0.2)
1.0
1.2
(0.2)
1.3
1.7
(0.4)
100%
0.6
0.5
0.1
0.7
0.9
(0.2)
1.3
1.4
(0.1)
65%
65%
0.6
1.4
6.1
0.4
3.1
7.7
0.2
(1.7)
1.7
1.3
1.3
0.1
(1.6)
23.4
22.8
0.4
1.2
0.6
2.3
1.7
0.6
2.8
3.2
(0.4)
29.5
30.6
(1.1)
Section 4: Resources and reserves
107
Reserves (continued)
Table 7 – Marketable coal reserves – proved and probable average quality
Proved Marketable
Probable Marketable
Bathurst
Mineral
Ownership
)
t
M
(
)
%
(
h
s
A
)
%
(
r
u
h
p
l
u
S
)
%
(
M
V
N
S
C
)
g
K
/
J
M
(
V
C
)
%
(
h
s
A
)
t
M
(
)
%
(
r
u
h
p
l
u
S
)
%
(
M
V
N
S
C
)
g
K
/
J
M
(
V
C
100%
0.2
12.9
1.9
35.0
6.8
28.9
0.1
14.5
1.5
34.0
6.1
28.4
100%
1.9
8.9
0.5
35.1
8.5
31.3
0.4
7.1
0.6
36.4
8.5
32.0
Deposit
Escarpment
Domestic
(11, 13, 16 & 18)
Escarpment
Export
(11,13, 16 & 18)
Whareatea West
(11, 13, 16 & 18)
100%
0.0
-
-
-
-
-
9.9
12.1
0.9
26.0
9.5
31.9
Stockton
(12, 13, 15 & 17)
Upper
Waimangaroa
(Met)
(12, 13, 15 & 17)
Takitimu
(11, 13, 14, 16 & 18)
65%
0.6
4.7
2.1
31.6
8.0
33.8
5.7
3.7
3.2
35.9
8.0
34.2
65%
0.5
3.3
1.1
38.6
4.0
28.6
2.6
2.4
1.1
38.5
4.5
29.0
100%
0.3
8.7
0.2
33.2
N/A
19.5
1.0
5.5
0.2
32.7
N/A
20.1
Canterbury Coal
(11, 13, 15, 16 & 18)
100%
Rotowaro
(12, 13, 17 & 19)
Maramarua
(12, 13, 15 & 17)
65%
65%
0.6
8.1
0.7
30.8
N/A
19.4
0.7
7.4
0.8
31.6
N/A
19.4
0.6
5.6
0.3
33.6
N/A
23.9
1.7
5.8
0.3
33.8
N/A
23.8
1.4
5.2
0.2
37.6
N/A
22.5
1.3
5.5
0.2
37.5
N/A
22.5
108 Bathurst Resources Limited Annual Report 2018
Table 8 – Marketable coal reserve – total average quality
Bathurst
Mineral
Ownership
Coal Type
Mining
Method
)
t
M
(
Total Marketable
)
%
(
h
s
A
r
u
h
p
l
u
S
)
%
(
)
%
(
M
V
N
S
C
V
C
100%
Thermal
Open Pit
0.3
13.4
1.8
34.7
6.6
28.7
Deposit
Escarpment
Domestic
(11, 13, 16 & 18)
Escarpment Export
(11, 13, 16 & 18)
100%
Whareatea West
(11, 13, 16 & 18)
100%
Stockton
(12, 13, 15 & 17)
Upper Waimangaroa
(Met)
(12, 13, 15 & 17)
Takitimu
(11, 13, 14, 16 & 18)
Canterbury Coal
(11, 13, 15, 16 & 18)
Rotowaro
(12, 13, 17 & 19)
Maramarua
(12, 13, 15 & 17)
65%
65%
100%
100%
65%
65%
Met
Met
Met
Met
Open Pit
2.3
8.6
0.5
35.3
8.5
31.4
Open Pit
9.9
12.1
0.9
26.0
9.5
31.9
Open Pit
6.2
3.8
3.1
35.5
8.0
34.2
Open Pit
3.1
2.5
1.1
38.5
4.5
28.9
Thermal
Open Pit
1.3
6.3
0.2
32.9
N/A
19.9
Thermal
Open Pit
1.3
7.7
0.8
31.2
N/A
19.4
Thermal
Open Pit
2.3
5.8
0.3
33.7
N/A
23.8
Thermal
Open Pit
2.8
5.4
0.2
37.6
N/A
22.5
All reserves quoted in this release are reported in terms as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves’ as published by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy,
Australian Institute of Geoscientists and Minerals Council of Australia (“JORC”).
The Measured and Indicated Mineral Resources are inclusive of Ore Reserves. Rounding of tonnes as required by reporting guidelines may result in
summation differences between tonnes and coal quality. All Ore Reserves quoted are reported as of 30 June 2018.
11 Reserve tonnages have been calculated using a density value calculated using approximated in-ground moisture values (Preston and Sanders
method) and as such reserve tonnages quoted in this report are wet tonnes. All coal qualities quoted are on an Air-Dried Basis.
12 Stockton, Upper Waimangaroa and Maramarua density values are based on air-dried ash density regressions. Stockton, Upper Waimangaroa,
Rotowaro and Maramarua coal quality parameters are reported on an air-dried basis.
13 Coal Reserve (Run of Mine (ROM) tonnes) includes consideration of standard mining factors (JORC Code 2012).
14 Decrease in Coal Reserves due to mining depletion, additional drilling and a revised geological model.
15 Decrease in Coal Reserves due to mining depletion.
16 Marketable Reserves are based on geologic modelling of the anticipated yield from ROM Reserves. Total Marketable Coal Reserves are reported at
a product specific moisture content (10–12 percent for Escarpment Export and Whareatea West, 5-8 percent at Escarpment Domestic, 14-16 percent
at Takitimu and 22-23 percent at Canterbury) and at an air-dried quality basis, for sale after the beneficiation of the Total Coal Reserves, converted
using ASTM D3180 ISO 1170. Reserve tonnages have been calculated using a density value calculated using approximated in-ground moisture values
(Preston and Sanders method) and as such all tonnages quoted in this report are wet tonnes. All coal qualities quoted are on an Air-Dried Basis.
17 Stockton, Upper Waimangaroa, Rotowaro and Maramarua are owned by BT Mining Limited.
18 Escarpment Domestic Reserves, Escarpment Export Reserves, Whareatea West Reserves, Takitimu Reserves and Canterbury Reserves are
100 percent Bathurst Resources Limited ownership.
19 Increase in Coal Reserves due to change in mine plan (inclusion of Waipuna West).
Section 4: Resources and reserves
109
Resource quality
The Company is not aware of any information to indicate that
the quality of the identified resources will fall outside the range
of specifications for reserves as indicated in the above table.
Further resource and reserve information can be found on the
company’s website at www.bathurst.co.nz
Mineral resource and ore reserves
governance and estimation process
Resources and reserves are estimated by internal and external
personnel, suitably qualified as Competent Persons under the
Australasian Institute of Mining and Metallurgy, reporting in
accordance with the requirements of the JORC Code, industry
standards and internal guidelines.
All resource estimates and supporting documentation are
reviewed by a Competent Person either employed directly by
Bathurst or employed as an external consultant. If there is a
material change in an estimate of a resource, or if the estimate is
an inaugural resource, the estimate and all relevant supporting
documentation are further reviewed by an external suitably
qualified Competent Person.
All reserve estimates are prepared in conjunction with
pre-feasibility, feasibility and life of mine studies which consider
all material factors.
All resource and reserve estimates are then further reviewed by
suitably qualified internal management.
The resources and reserves statements included in Bathurst’s
2018 Annual Report have been reviewed by qualified internal and
external Competent Persons, and internal management, prior to
their inclusion.
110 Bathurst Resources Limited Annual Report 2018
Competent person statements
The information in this report that relates to mineral resources
for Deep Creek and the mineral reserves for Escarpment
Export, Stockton and Whareatea West is based on information
compiled by Sue Bonham-Carter, who is a full time employee of
Golder Associates (NZ) Ltd and is a Chartered Professional and
member of the Australasian Institute of Mining and Metallurgy
and member of Professional Engineers and Geoscientists
of British Columbia, Canada. Ms Bonham-Carter has a BSc
Engineering (Mining) (Hons) from the Queen's University,
Canada. Ms Bonham-Carter has sufficient experience which is
relevant to the style of mineralisation and type of deposit under
consideration and to the activity which she is undertaking to
qualify as a Competent Person as defined in the 2004 Edition
and 2012 Edition of the ‘Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves’. Ms
Bonham-Carter consents to the inclusion in this report of the
matters based on her information in the form and context in
which it appears above.
The information in this report that relates to exploration results
and mineral resources for Escarpment Domestic, Escarpment
Export, Cascade, Albury, Coalbrookdale, Whareatea West,
Millerton North, North Buller, Blackburn, Takitimu, Canterbury
Coal, New Brighton, Rotowaro, Sullivan and Maramarua is based
on information compiled by Hamish McLauchlan as a Competent
Person who is a full time employee of Bathurst Resources
Limited and is a member of the Australasian Institute of Mining
and Metallurgy. Mr McLauchlan has a BSc and MSc (Hons)
majoring in geology from the University of Canterbury. Mr
McLauchlan has sufficient experience which is relevant to the
style of mineralisation and type of deposit under consideration
and to the activity which he is undertaking to qualify as a
Competent Person as defined in the 2004 Edition and 2012
Edition of the ‘Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves’. Mr McLauchlan
consents to the inclusion in this report of the matters based
on his information in the form and context in which it
appears above.
The information in this report that relates to exploration results
and mineral resources for Stockton and Upper Waimangaroa is
based on information compiled by Mark Lionnet as a Competent
Person who is a full time employee of BT Mining Limited
and is a member of the Australasian Institute of Mining and
Metallurgy. Mr Lionnet has a BSc (Hons) majoring in geology
from the University of Witwatersrand. Mr Lionnet has sufficient
experience which is relevant to the style of mineralisation and
type of deposit under consideration and to the activity which
he is undertaking to qualify as a Competent Person as defined
in the 2012 Edition of the 'Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves'.
Mr Lionnet consents to the inclusion in this report of the matters
based on his information in the form and context in which it
appears above.
The information in this report that relates to mineral reserves for
Escarpment Domestic, Takitimu, Canterbury and Maramarua is
based on information compiled by Terry Moynihan who is a full
time employee of Bathurst Resources Limited and is a member
of the Australasian Institute of Mining and Metallurgy.
Mr Moynihan has a Bachelor of Technology (Mining) from the
Otago School of Mines. Mr Moynihan has sufficient experience
which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity which he is
undertaking to qualify as a Competent Person as defined in
the 2012 Edition of the 'Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves'.
Mr Moynihan consents to the inclusion in this report of the
matters based on his information in the form and context in
which it appears above.
The information in this report that relates to mineral reserves
at Rotowaro is based on information compiled by Martin Bourke
who is a full time employee of BT Mining Limited and is a
member of the Australasian Institute of Mining and Metallurgy.
Mr Bourke has a Bachelor of Engineering (Mining) and BSc
(Chemistry) from Massey University. Mr Bourke has sufficient
experience which is relevant to the style of mineralisation and
type of deposit under consideration and to the activity which
he is undertaking to qualify as a Competent Person as defined
in the 2012 Edition of the 'Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves'.
Mr Bourke consents to the inclusion in this report of the matters
based on his information in the form and context in which it
appears above.
Section 4: Resources and reserves
111
Corporate directory
Directors
Toko Kapea
Non–executive Chairman
Peter Westerhuis
Non-executive Director
Richard Tacon
Executive Director and Chief Executive Officer
Russell Middleton
Executive Director and Chief Financial Officer
Company secretary
Bill Lyne
New Zealand company number
4382538
New Zealand business number
9429030288560
Australian registered business number
164 306 905
Registered office
Level 12, 1 Willeston Street
Wellington 6011
New Zealand
Phone: +64 4 499 6830
Australian registered office
23A Marney Street,
Chapel Hill,
Queensland 4069
Australia
Phone: +61 7 3378 7673
112 Bathurst Resources Limited Annual Report 2018
Share registry
Computershare Investor Services Limited
159 Hurstmere Road
Takapuna Central 0622
New Zealand
Phone: +64 9 488 8700
60 Carrington Street
Sydney NSW 2000
Phone: +61 3 9415 4000
Auditor
KPMG
10 Customhouse Quay
PO Box 996
Wellington 6140
New Zealand
Solicitor
Minter Ellison Rudd Watts Lawyers
125 The Terrace
Wellington 6011
New Zealand
Lane Neave
141 Cambridge Terrace
Christchurch 8013
New Zealand
Banker
ANZ Bank New Zealand Limited
Stock exchange listing
Bathurst Resources Limited shares are listed on the Australian
Securities Exchange (ASX) under the code BRL
Website address
www.bathurst.co.nz
Disclaimer
This report has been prepared by Bathurst Resources Limited. Information contained in this report is current as at 30 June 2018 or
as otherwise noted in the report. This report is provided for information purposes only and has been prepared without taking account
of any particular reader's financial situation or objectives. Nothing contained in this report constitutes investment, tax, legal or other
advice. Accordingly, readers should, before acting on any information in this report, consider its appropriateness, having regard to
their objectives, financial situation and needs, and seek the assurance of their financial advisor or other licensed professional before
making any investment decision. This report does not constitute an offer, invitation, solicitation or recommendation with respect to
the subscription for purchase or sale of any security, nor does it form the basis of any contract or commitment.
Bathurst Resources Limited
Level 12, 1 Willeston Street
Wellington 6011
New Zealand
+64 4 499 6830
www.bathurst.co.nz