Quarterly report . Appndx 5B
Centamin Egypt Limited
29 April 2005
CENTAMIN EGYPT LIMITED
('Centamin' or the 'Company')
ACN 007 700 352
QUARTERLY REPORT FOR PERIOD ENDING 31 MARCH 2005
* Security Permits granted for return to work at Sukari
* New 30 year Sukari Mining (Exploitation) Lease of 160km2
* Tax exemptions and royalty arrangements unchanged
* 50,000m Drilling Program commences at Sukari Hill
• Sukari Project
Since receiving the Security Permits the Company has moved quickly to mobilise
personnel and equipment and we are please to report that drilling has now
recommenced in the Amun zone (infill) and the Ra zone (step-out). The Company is
now embarking on its most aggressive drilling program to date targeting
completion of 50,000m by the end of the calendar year.
The Company has previously drilled 322 holes for 66,000m, predominantly in the
southern 800m (Amun and Ra zones) of the mapped 2.5km granodiorite porphyry
outcrop. The current measured, indicated and inferred resource defined in this
area is 2.94M oz. This resource has been calculated independently by Hellman and
Schofield to JORC standards.
Geological logging of the diamond drill core indicates that the zones of
mineralisation are well defined within the Sukari porphyry. Mineralisation is
related to stockworks, brecciation, quartz veining and contact mineralisation,
these are traceable along the strike and dip of the Sukari porphyry. The
mineralised system has now proven to be continuous from section to section as
the drilling has progressed into the Ra zone, with the mineralisation being
consistent with the mineralisation logged in the Amun Zone.
In order to appreciate the potential at Sukari it is important to understand
that the Amun and Ra zones are the same continuous mineralisation contained
within the Sukari outcrop, with the differentiation being made purely for ease
of reference rather than being separate structures. As such Sukari has the
capacity to host a multi million ounce single pit deposit, with much of the Ra
zone yet to be included in the resource calculation and the Gazelle and Pharaoh
zones yet to be tested by drilling.
• Bankable Feasibility Study
At the time activities were interrupted, the company had completed a scoping
study and had commenced work on a Bankable Feasibility Study into the
development of a 4 to 5 million tonne per annum processing facility, forecast to
produce an initial 250,000 oz of gold per annum. As part of this study, two
tonnes of metallurgical samples were collected which have now arrived in Perth.
The proposed test-work programme is to be focussed on 3 key areas:
- additional comminution analysis for optimal grinding circuit sizing;
- flotation testwork at various grind sizes;
- whole of ore leach at various grind sizes.
Variability tests will also be conducted on a variety of ore types. A
significant number of these tests have been carried out previously however more
need to be carried out as both potential process flow sheets (flotation and CIL)
require optimisation to determine which capital/operating cost profile provides
the best economics. This work is scheduled to take up to 9 weeks from sample
presentation.
BFS completion is targeted for first quarter 2006.
• Corporate
As previously announced, agreement was reached with the Egyptian Mineral
Resource Authority (EMRA) for a return to work at Sukari. EMRA signed the
Security Permits required to re-commence work and the Company is also pleased to
advise that a new environment of co-operation now exists between the parties,
together with a joint desire to begin to develop the vast mineral wealth of
Egypt.
His Excellency Engineer Sameh Fahmy, the Minister for Petroleum and Mineral
Resources, stated that 'The Egyptian Government looks forward to a long and
successful partnership with Centamin and its subsidiary Pharaoh Gold Mines NL.
The mineral resource industry in Egypt has a very positive future which to date
has not been fully appreciated. I will be fully supportive of the company's
development and exploration activities in order to fast track Egypt's first
modern gold operation. All the problems of the past are behind us and the future
is very exciting for the Sukari project.'
The Company has re-commenced operations on a new Mining (Exploitation) Lease
covering an area of 160 km2 that contains the proposed Sukari mine site and
surrounding prospects. This lease is issued under the existing Law 222 of 1994,
which was enacted by the Egyptian Government specifically to accommodate the
company's exploration and mining activities in the Eastern Desert.
Law 222 remains unchanged and as such the Company has title for a period of 30
years commencing immediately and which is renewable at the company's election
for a further period of 30 years. All tax and royalty arrangements remain
unchanged. It is the Company's intention to make application for additional
lease areas at the appropriate time.
From the Company's contact with the Ministry, it is apparent that there is a
genuine interest to attract mining investment. The Ministry has sought
independent advice from international authorities with the intention to enact
new mining legislation that will provide for an exploration and mining
legislative framework similar to that which is in effect elsewhere in Africa.
All Legal actions and the proceedings before the Centre for Arbitration that
were initiated by the Company are now in the process of being withdrawn.
For Centamin Egypt Limited
Josef El-Raghy
Managing Director
29 April 2005
Rule 5.3
Appendix 5B
Mining exploration entity quarterly report
Introduced 1/7/96. Origin : Appendix 8. Amended 1/7/98, 30/9/2001.
Name of Entity
Centamin Egypt Limited
ABN Quarter ended ('current quarter')
86 007 700 352 31 March 2005
Consolidated statement of cash flows
Centamin Egypt Limited
Pharaoh Gold Mines NL (100%)
Viking Resources Ltd (100%)
North African Resources (100%)
----------- -----------
Cash flows related to operating activities Current Quarter Year to date
$A'000 (9 months)
$A'000
----------- -----------
1.1 Receipts from product sales and related - -
debtors
1.2 Payments for (a) exploration and evaluation (486) (1,585)
(b) development - (1)
(c) production - -
(d) administration (233) (465)
1.3 Dividends received - -
1.4 Interest and other items of a similar
nature received 271 791
1.5 Interest and other costs of finance paid - -
1.6 Income taxes paid - -
1.7 Other (provide details if material) - -
----------- -----------
Net Operating Cash Flows (448) (1,260)
--------------------------------- ----------- -----------
Cash flows related to investing activities
1.8 Payment for purchases of (a) prospects - -
(b) equity investments - -
(c) other fixed assets (17) (116)
1.9 Proceeds from sale of (a) prospects - -
(b) equity investments - -
(c) other fixed assets 2 3
1.10 Loans to other entities *(Refer Note 1) (496) (1,692)
1.11 Loans repaid by other entities - -
1.12 Other (provide details if material) - -
----------- -----------
Net investing cash flows (511) (1,805)
----------- -----------
1.13 Total operating and investing cash flows
(carried forward) (959) (3,065)
----------- -----------
1.13 Total operating and investment cash flows (brought
forward) (959) (3,065)
--------------------------------- ----------- -----------
Cash flows related to financing activities
1.14 Proceeds from issues of shares, options, etc. 35 35
1.15 Proceeds from sale of forfeited shares - -
1.16 Proceeds from borrowings *(Refer Note 1) 496 1,692
1.17 Repayment of borrowings - -
1.18 Dividends paid - -
1.19 Other (provide details if material) - -
----------- -----------
Net financing cash flows 531 1,727
--------------------------------- ----------- -----------
Net increase (decrease) in cash held (428) (1,338)
1.20 Cash at beginning of quarter/year to date 19,899 21,108
1.21 Exchange rate adjustments to item 1.20 (57) (356)
----------- -----------
1.22 Cash at end of quarter 19,414 19,414
--------------------------------- ----------- -----------
*Note 1 - From the March 2004 Quarter onwards, the funding of exploration
expenditure by the Holding Company to its subsidiaries will be disclosed as an
inter-entity loan under sections 1.10 and 1.16 respectively.
-----------
Payments to directors of the entity and associates of the Current quarter
directors
Payments to related entities of the entity and associates of $A'000
the related entities -----------
1.23 Aggregate amount of payments to the parties included in
item 1.2 199,958
-----------
1.24 Aggregate amount of loans to the parties included in item -
1.10 -----------
-------------------------------------------
1.25 Explanation necessary for an understanding of the transactions
(a) Mr S El-Raghy, a director, and an employee of Pharaoh Gold Mines NL received
salary for the quarter amounting to $90,333.
(b) Mr J El-Raghy, a director and employee of the Company received salary and
superannuation for the quarter amounting to $58,053.
(c) Mr S El-Raghy & Mr J El-Raghy are also Directors and Shareholders of
El-Raghy Kriewaldt Pty Ltd ('El-Raghy Kriewaldt'). El-Raghy Kriewaldt
provides office premises to the Company. All dealings with El-Raghy
Kriewaldt are in the ordinary course of business and on normal terms and
conditions. Rent paid to El-Raghy Kriewaldt during the current quarter
amounted to $17,335.
(d) Directors fees and superannuation paid during the quarter amounted to
$19,875.
(e) Services
Dr T Elder, a non-executive director provides additional consulting services
to the Company. All dealings with Dr T Elder are in the ordinary course of
business and on normal terms and conditions. Consulting fees paid to Dr T
Elder during the current quarter amounted to $6,102.
(f) Insurance
Mr C Cowden, a non-executive director, is also a director and shareholder of
Cowden Limited. Cowden Limited provides insurance broking services to the
Company. All dealings with Cowden Limited are in the ordinary course of
business and on normal terms and conditions. Insurance premiums paid to
Cowden Limited during the current quarter amounted to $8,260.
Non-cash financing and investing activities
2.1 Details of financing and investing transactions which have had a material
effect on consolidated assets and liabilities but did not involve cash flows
-
2.2 Details of outlays made by other entities to establish or increase their
share in projects in which the reporting entity has an interest
-
Financing facilities available
Add notes as necessary fro an understanding of the position.
----------- -----------
Amount available Amount used
$A'000 $A'000
----------- -----------
3.1 Loan facilities - -
----------- -----------
3.2 Credit standby arrangements - -
--------------------------------- ----------- -----------
Estimated cash outflows for next quarter
$A'000
-----------
4.1 Exploration and evaluation 1,000
-----------
4.2 Development 30
------------------------------------------- -----------
Total 1,030
------------------------------------------- -----------
Reconciliation of Cash
--------------------------------- ----------- -----------
Reconciliation of cash at the end of the Current quarter Previous quarter
quarter (as shown in the consolidated
statement of cash flows) to the related
items in the accounts is as follows.
$A'000 $A'000
--------------------------------- ----------- -----------
5.1 Cash on hand and at bank 286 305
----------- -----------
5.2 Deposits at call 380 440
----------- -----------
5.3 Bank overdraft - -
----------- -----------
5.4 Term deposits 18,748 19,154
--------------------------------- ----------- -----------
Total: cash at end of quarter (item 1.22) 19,414 19,899
--------------------------------- ----------- -----------
Changes in interests in mining tenements
---------- --------------- --------- ---------
Tenement Nature of Interest at Interest at
reference interest beginning end of
(note(2)) of quarter quarter
---------- --------------- --------- ---------
6.1 Interest in
mining
tenements
relinquished,
reduced or
lapsed ---------- --------------- --------- ---------
6.2 Interests
in mining
tenements
acquired or
increased
---------- --------------- --------- ---------
Issued and quoted securities at end of current quarter
Description includes rate of interest and any redemption or conversion rights
together with prices and dates.
------------------ ---------- ---------- ---------- ----------
Total number Number quoted Issue price Amount paid
security up per security
(see note 3) (see note 3)
(cents) (cents)
------------------ ---------- ---------- ---------- ----------
7.1 Preference
+securities
(description)
------------------ ---------- ---------- ---------- ----------
7.2 Changes during
quarter
(a) increases
through issues
(b) decreases
through returns
of capital,
buy-backs,
redemptions
------------------ ---------- ---------- ---------- ----------
7.3 +Ordinary
securities 502,060,369 502,060,369
------------------ ---------- ---------- ---------- ----------
7.4 Changes
during quarter 150,000 150,000
(a) increases
through options
exercise
(b) decreases
through returns
of capital,
buy-backs ---------- ---------- ---------- ----------
------------------
7.5 +Convertible
debt securities
(description)
------------------ ---------- ---------- ---------- ----------
7.6 Changes during
quarter
(a) increases
through issues
(b) decreases
through
securities
matured,
converted
------------------ ---------- ---------- ---------- ----------
7.7 Options Employee Option Exercise price Expiry date
(description Plan 2002
and conversion 250,000 Nil 29.00 cents 11/11/2005
factor) 1,010,000 Nil 23.10 cents 12/11/2006
130,000 Nil 23.10 cents 17/11/2006
750,000 Nil 35.49 cents 15/12/2006
775,000 Nil 28.04 cents 04/02/2008
410,000 Nil 28.04 cents 17/02/2008
---------- ---------- ---------- ----------
7.8 Issued
during quarter 775,000 Nil 28.04 cents 04/02/2008
410,000 Nil 28.04 cents 17/02/2008
---------- ---------- ---------- ----------
7.9 Exercised
during quarter 150,000 150,000 23.10 cents 12/11/2006
---------- ---------- ---------- ----------
7.10 Expired/
lapsed during ---------- ---------- ---------- ----------
quarter
------------------
7.11 Debentures
(totals only)
------------------ ---------- ----------
7.12 Unsecured
notes
(totals only)
------------------ ---------- ----------
Compliance statement
1. This statement has been prepared under accounting policies which comply with
accounting standards as defined in the Corporations Act or other standards
acceptable to ASX (see note 4).
2. This statement does give a true and fair view of the matters disclosed.
Sign here: Company Secretary Date: 29 April 2005
Print name: Heidi Brown
1. The quarterly report provides a basis for informing the market how the
entity's activities have been financed for the past quarter and the effect
on its cash position. An entity wanting to disclose additional information
is encouraged to do so, in a note or notes attached to this report.
2. The 'Nature of interest' (items 6.1 and 6.2) includes options in respect of
interests in mining tenements acquired, exercised or lapsed during the
reporting period. If the entity is involved in a joint venture agreement and
there are conditions precedent which will change its percentage interest in
a mining tenement, it should disclose the change of percentage interest and
conditions precedent in the list required for items 6.1 and 6.2.
3. Issued and quoted securities The issue price and amount paid up is not
required in items 7.1 and 7.3 for fully paid securities.
4. The definitions in, and provisions of, AASB 1022: Accounting for Extractive
Industries and AASB 1026: Statement of Cash Flows apply to this report.
5. Accounting Standards ASX will accept, for example, the use of International
Accounting Standards for foreign entities. If the standards used do not
address a topic, the Australian standard on that topic (if any) must be
complied with.
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