Quarterly report Appndx 5B
Centamin Egypt Limited
28 July 2005
CENTAMIN EGYPT LIMITED
('Centamin' or the 'Company')
ACN 007 700 352
QUARTERLY REPORT FOR PERIOD ENDING 30 JUNE 2005
• New drilling confirms continuity of mineralisation and indicates an
increase in the 2.94m oz Sukari Resource
• DDH 326 - 46 metres @ 2.00 g/t (including 11 metres @ 3.11 g/t and 3
metres @ 9.39 g/t), DDH 329 - 12 metres @ 2.27 g/t,
DDH 336 - 20 metres @ 2.43 g/t and 11 metres @ 2.36 g/t,
DDH 338A - 5 metres @ 14.02 g/t
• Ausenco Limited appointed to prepare Sukari Project Feasibility Study to
a Bankable Standard
• Minister visits Sukari Site, Egyptian Government fully supportive of the
development of the Sukari Project
• SUKARI PROJECT
Drilling recommenced on 15 May 2005 and was initially focused on elevating the
inferred category of the first stage 1.8 million ounce optimised pit shell
contained within the Amun zone and part of the Ra zone, to the measured and
indicated resource categories. Drill assays received to date support this
programme of conversion whilst also increasing the overall contained ounces
within the proposed stage 1 pit itself. Drilling within this area has
highlighted that mineralisation remains continuous at depth. Five of the seven
drill rigs on site are currently drilling and it is planned to have all seven
operational during August.
The current measured, indicated and inferred geological resource of 2.94 million
ounces has been calculated from 322 drill holes for 66,000m, predominantly in
the southern 800m (Amun and Ra zones) of the mapped 2.5km Sukari granodiorite
porphyry outcrop. 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 the Ra, Gazelle and Pharaoh zones from northing 11000N to 12200N (1200m
strike) rock chip sampling has been completed on 100m spacing to 12200N and
infilled on 50m spacing to 10450N, the purpose of the sampling was to test and
map the Sukari outcrop where there currently is no drill access. Rock chip
sampling and mapping during the quarter has demonstrated that mineralisation
continues north of the area containing the current 2.94 million ounce resource.
• SIGNIFICANT DRILL INTERSECTIONS
See attached schedule for significant gold intersections.
Drill holes 312 and 314 have tested mineralisation below the floor of the
current pit shell and down to the lower footwall contact of the porphyry. Both
holes display that there is significant mineralisation along strike and at depth
from the Amun zone into the Ra zone.
Drill hole 323C successfully tested and highlighted zones of gold mineralisation
below the existing pit shell.
Drill hole 326 revealed robust grades over significant widths together with
areas of high grade mineralisation and will contribute additional ounces to the
resource on a section that was previously categorised as being un-mineralised.
Visible gold was noted on the contact and this may be an extension of the high
grade Hapi shoot, which is further south than expected.
A series of tracks have been planned for the eastern side of the hill to give
good access for drilling up to 12200N. Two rock breakers continued development
of tracks along the Upper and Lower Gazelle 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
potential 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.
• FEASIBILITY STUDY
At the time activities at Sukari were interrupted, the company had completed a
scoping study and had commenced work on a Feasibility Study to a bankable
standard (BFS) 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.
This study recommenced during late May and is being prepared by Ausenco Limited.
Metallurgical testwork is now underway and is focussing 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 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.
The completion of the Feasibility Study is targeted for first quarter 2006.
Ausenco Limited is a multi-disciplined engineering company specialising in the
design and construction of mineral treatment plants. Ausenco's experience in the
design, construction and commissioning of mineral processing plants provides the
company with the required expertise to progress the development of Egypt's first
modern gold mining operation. Ausenco has undertaken projects involving similar
unit operations to those proposed in the Sukari Gold Project feasibility study
and has prepared numerous feasibility studies to the level of accuracy required
for project financing.
These projects include:-
• Sepon Gold Project, Laos
• North Mara Gold Project, Tanzania
• Chatree Gold Project, Thailand
• Tolukuma Gold Project, PNG
• Granites Gold Project, NT Australia
• Alumbrera Copper Project Gravity Circuit
• Porgera Gold Project Gravity Circuit
• Bronzewing Gold Project Gravity Circuit
• CORPORATE
As previously announced, agreement was reached with the Egyptian Mineral
Resource Authority (EMRA) for a return to work at Sukari. A new environment of
co-operation exists between the parties, together with a joint desire to begin
to develop the vast mineral wealth of Egypt.
During July, his Excellency, Engineer Sameh Fahmy, the Minister for Petroleum
and Mineral Resources, the Deputy Minister, Eng Amghad Ghonem, and the entire
EMRA Board, together with a large media entourage visited the Sukari Project
site where the Minister stated on national television that the project has his,
and the Egyptian Government's full support.
For Centamin Egypt Limited
Josef El-Raghy
Managing Director
28 July 2005
ASX Listing Rules 5.10
Information in this report which relates to exploration, geology, sampling and
drilling is based on information compiled by geologist Mr R Osman who is a full
time employee of the Company, and is a member of the Australasian Institute of
Mining and Metallurgy with more than five years experience in the fields of
activity being reported on, and is a 'Competent Person' for this purpose. His
written consent has been received by the Company for this information to be
included in this report in the form and context which it appears.
The information in this report that relates to mineral resources is based on
information compiled by Mr Gary Brabham, a member of the Australasian Institute
of Mining and Metallurgy. Mr Brabham was employed by Hellman & Schofield Pty Ltd
a consultancy primarily concerned with estimation of mineral resources
worldwide. Mr Brabham is a Competent Person under the meaning of the J.O.R.C.
code with respect to the mineralisation being reported in this report. Mr
Brabham has more than five years' experience in the mining industry and has
given his consent to the public reporting of this information in the section
headed Resource Increase.
For this report, measured resources lie in areas where drilling is available at
nominal 25 x 25 metre spacing, indicated resources in areas drilled at
approximately 25 x 50 metre spacing and inferred resources in areas of broader
spaced drilling. The resource model extends to 750RL (approximately 400 metres
below surface), and resources are estimates of recoverable tonnes and grades
using Multiple Indicator Kriging with block support correction.
Appropriate check sampling has been undertaken to verify the gold assays used in
this estimate.
SUKARI GOLD PROJECT
SIGNIFICANT MINERALISED INTERSECTIONS
DIAMOND DRILL HOLES 312-339
Hole Northing From To Interval Grade Comment
Number (m) (m) (m)
DDH312 10900 0 395 Reported March 2003
456 460 4 4.22
465 468 3 2.97
526 531 5 2.50
565 566 1 37.50 Sheared footwall contact
DDH314 10975 188 195 7 1.74
267 269 2 2.44
405 406 1 5.47
424 429 5 2.47
442 447 5 2.91
451 455 4 2.43
486 489 3 3.51
587 589 2 3.27
598 599 1 20.50
DDH319 10900 204 207 3 2.08
DDH322 10350 16 18 2 2.18
75 85 10 2.24
DDH323C 10125 123 125 2 4.08
130 132 2 4.05
138 180 42 1.90
including 138 145 7 4.67
183 188 5 2.54
198 213 15 1.77
224 242 18 1.81
258 261 3 2.36
275 292 17 1.76
including 280 285 5 2.88
DDH325 10800 45 52 7 2.26
DDH326 10075 170 216 46 2.00
196 207 11 3.11
230 233 3 4.56
240 245 5 2.00
262 264 2 4.31
303 306 3 9.39 Visible gold, highly
sheared, brecciated
DDH327 10675 211 212 1 21.20
DDH328 10125 15 16 1 3.00
46 47 1 4.14
DDH329 10150 185 191 6 2.94
199 203 4 3.81
207 209 2 4.42
249 261 12 2.27
272 279 7 3.96
including 276 277 1 13.30
300 303 3 15.83 Visible gold related to
brecciation
including 302 303 1 29.70
DDH331 10650 196 201 5 6.68
198 199 1 15.60
212 213 1 4.54
DDH332 10100 99 101 2 4.06
DDH334 10225 272 277 5 2.34
DDH335 10150 90 91 1 9.23
122 126 4 3.34
DDH336 10175 174 194 20 2.43
201 212 11 2.36
203 206 3 5.03
244 248 4 3.79
285 288 3 3.26
DDH338A 10459 39 44 5 2.20
87 90 4 2.30
132 137 5 14.02
147 150 3 2.44
DDH339 10275 182 200 17 1.97
192 196 4 4.09
202 207 5 3.58
217 218 1 8.74
278 284 6 2.77 Mineralisation related
footwall shear
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 30 June 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 (12 months)
$A'000
----------- -----------
1.1 Receipts from product sales and related -
debtors
1.2 Payments for
(a) exploration and evaluation (1,090) (2,675)
(b) development (136) (137)
(c) production - -
(d) administration (234) (699)
1.3 Dividends received - -
1.4 Interest and other items of a similar
nature received 255 1,046
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 (1,205) (2,465)
------------------------------- ----------- -----------
Cash flows related to investing activities
1.8 Payment for purchases of
(a) prospects - -
(b) equity investments - -
(c) other fixed assets (143) (260)
1.9 Proceeds from sale of
(a) prospects - -
(b) equity investments - -
(c) other fixed assets - 3
1.10 Loans to other entities *(Refer Note 1) (1,369) (3,060)
1.11 Loans repaid by other entities - -
1.12 Other (provide details if material) - -
----------- -----------
Net investing cash flows (1,512) (3,317)
----------- -----------
1.13 Total operating and investing cash flows
(carried forward) (2,717) (5,782)
----------- -----------
1.13 Total operating and investment cash flows (brought
forward) (2,717) (5,782)
------------------------------- ----------- ----------
Cash flows related to financing activities
1.14 Proceeds from issues of shares, options, etc. - 35
1.15 Proceeds from sale of forfeited shares - -
1.16 Proceeds from borrowings *(Refer Note 1) 1,369 3,060
1.17 Repayment of borrowings - -
1.18 Dividends paid - -
1.19 Other (provide details if material) - -
----------- ----------
Net financing cash flows 1,369 3,095
------------------------------- ----------- ----------
Net increase (decrease) in cash held (1,348) (2,687)
1.20 Cash at beginning of quarter/year to date 19,413 21,108
1.21 Exchange rate adjustments to item 1.20 (119) (475)
----------- ----------
1.22 Cash at end of quarter 17,946 17,946
------------------------------- ----------- ----------
*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 1.2 358
-----------
1.24 Aggregate amount of loans to the parties included in item -
1.10 -----------
----------------------------------------
1.25 Explanation necessary for an understanding of the transactions
- Salaries, superannuation contributions, consulting and directors fees
paid to Directors amounted to $344,993 for the quarter.
- Mr S El-Raghy and Mr J El-Raghy are Directors and shareholders of
El-Raghy Kriewaldt Pty Ltd ('ELK'), which provides office premises to
the Company. All dealings with ELK are in the ordinary course of
business and on normal terms and conditions. Rent paid to ELK during
the quarter amounted to $13,001.
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 for 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 2,800
-----------
4.2 Development 480
------------------------------------------------------------ -----------
Total 3,280
-------------------------------------------- -----------
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 319 286
----------- -----------
5.2 Deposits at call 1,356 380
----------- -----------
5.3 Bank overdraft - -
----------- -----------
5.4 Term deposits 16,271 18,748
------------------------------- ----------- -----------
Total: cash at end of quarter (item 1.22) 17,946 19,414
------------------------------- ----------- -----------
Changes in interests in mining tenements
--------- --------- ---------- ---------------
Tenement Nature of Interest at Interest at end
reference interest beginning of quarter
(note (2)) of quarter
--------- ---------- ---------- ---------------
---------------
6.1 Interest in During the quarter the company reached an agreement to begin
mining tenements working on an area of 160km2 as a mining lease as defined by
relinquished, law 222 of 1994. Negotiations are continuing with the Egyptian
reduced or Mineral Resource Authority (EMRA) on other areas.
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 Issue price Amount paid up
number quoted per security 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
(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 Expiry date
(description Plan 2002 price
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 ---------- ---------- ---------- --------------
7.9 Exercised
during quarter ---------- ---------- ---------- --------------
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: 28 July 2005
Print name: Heidi Brown
Notes
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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