For personal use only - ASX · 7/29/2016 · Offtake agreements are already in place with India’s JSW Steel and BMM Ispat for Phase Two product. QUARTERLY ACTIVITIES REPORT For

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NSL CONSOLIDATED LTD

Issued 29 July 2016

JUNE QUARTER HIGHLIGHTS

IRON ORE

Binding agreement for joint development of greenfield steel plant in India with Wei

Hua Group Co Ltd, China’s largest heavy equipment crane building company, with

revenues in excess of US$1 billion in 2015.

Discussions continue with Andhra Pradesh Government around advancing the

executed Memorandum of Understanding towards binding agreements for new

projects.

Andhra Pradesh on track for +14% growth for next 15 years as a result of building a

new state.

Engineers from China Huate conduct first visit to NSL’s stockyard and mines of Phase Two

wet plant project.

Huate equipment delivery complete, Huate focus now moves to erection and

commissioning assistance.

Indian site works and civils progress on schedule, leading to commissioning

commencing in Q3 2016 with positive cash flow in Q4 2016.

Civil foundation work commencement celebrated with Puja, attended by local

dignitaries, village elders and bureaucrats, highlighting local engagement and

support of the project.

Offtake agreements are already in place with India’s JSW Steel and BMM Ispat for

Phase Two product.

QUARTERLY ACTIVITIES REPORT

JUNE 2016

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IRON ORE - INDIA

BINDING AGREEMENT FOR JOINT DEVELOPMENT OF GREENFIELD STEEL PLANT

During the quarter, the Company signed a Memorandum of Understanding (MoU) with Wei

Hua Group Co Ltd, China’s leading heavy equipment crane building company for the

establishment of a steel making plant in Andhra Pradesh.

The MOU progressed and was then superseded by the execution of a Binding Agreement for

Joint Development as both parties consolidate their understanding and establish the

conditions precedent and other activities to be carried out until the execution of final

Shareholder and operating agreements for the proposed project.

The transition to a binding agreement further strengthens the relationship between the

Company and Wei Hua, and demonstrates Wei Hua’s commitment to investing in the Indian

economy and importantly, the progress made by the Company to date in India.

Wei Hua Group Co Ltd, with revenues in excess of US$1 billion in 2015, has already acquired

significant parts of the future steel making plant, with the remainder to be purchased as

required, based on Indian progress. Wei Hua is looking to diversify its revenue stream, both in

location and source generation (Reference http://www.weihuagrp.com/).

Wei Hua views the Indian economy as one of the most attractive up and coming investment

opportunities in the world. India is expected to become the world's second largest producer

of crude steel in the next 10 years, moving up from the third position, as its capacity is

projected to increase to about 300 MT by 2025 from 81 MT in 2013-14. Huge scope for growth

is offered by India’s comparatively low per capita steel consumption and the expected rise

in consumption due to increased infrastructure construction and the thriving automobile and

railways sectors.

In addition to this, Wei Hua also sees significant value in what NSL has been able to achieve

in India, as the only foreign company to own and operate iron ore mines and also with the

significant progress made by the Company and the Andhra Pradesh Government (GoAP) as

part of the existing joint MOU.

Blast furnace shell

As announced previously the Company has signed an MOU directly with GoAP, whereby

GoAP will facilitate the provision of necessary assistance for the Company to grow its Andhra

Pradesh mining, beneficiation and value addition activities to in excess of 8 million tonnes per

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annum of iron ore production; such assistance includes land acquisition, adequate

infrastructure development and attractive incentives as per the policies / rules and

regulations of the State Government.

In addition, the GoAP will support the Company’s participation in significant projects in

Andhra Pradesh, wherever feasible. Such participation may include providing advisory

services, setting up manufacturing facilities, Infrastructure development, R&D and

Implementation support. The Company can support the development of infrastructure in

Andhra Pradesh, considering the Government’s focus on promoting manufacturing and

industrialization in the state and facilitating a conducive investment environment.

One key enabler to the execution of the MoU was the GoAP committing to the development

of the Orvakallu Mega Industrial Hub, located in the Kurnool District some 30 km from NSL’s

existing operations. The 28,000 acre hub will include access to water, power, rail and road.

The site is also proposed for one of AP’s four greenfield airports outlined in the strategic

infrastructure plan for the State. The Company will be proposing utilising this industrial hub as

a foundation for the agreement with Wei Hua Group, and continues to leverage the GoAP

MOU, with discussions on providing the approvals for the land, power, water and other utilities

for the steel project already commenced.

The Wei Hua Group also brings strong ties into the Asia Infrastructure Investment Bank (AIIB).

The AIIB is a newly established international financial institution that aims to support the

building of infrastructure in the Asia-Pacific region. The bank has 37 member states and was

proposed as an initiative by the government of China. The capital of the bank is $100 billion,

equivalent to 2⁄3 of the capital of the Asian Development Bank and about half that of the

World Bank.

Key Terms of Agreement

The joint venture Company will be established with a 50/50 shareholding and importantly, NSL

is not required to fund any aspect of the Joint Venture.

NSL shall provide reasonable assistance to Wei Hua for the feasibility studies, including the

latest market research on the Iron and Steel industry in India which will assist in determining

the size and scale of the proposed steel plant project.

Initially, NSL shall conduct a study to understand the governmental approvals, licences,

consents, no-objections etc. required from statutory, governmental and other authorities

under the laws of India for the proposed project, setting up of the JV, and commencement

of the preliminary activities for the project. This will be undertaken in consultation with Wei

Hua and NSL shall seek reasonable assistance from Wei Hua.

Next, NSL shall commence the preliminary activities for obtaining and providing the legal and

regulatory approvals, accessing available land for the proposed project and shall take all

appropriate steps towards the supply of supplementary materials and human resources for

the proposed project

NSL shall be responsible for the operations, commercial marketing and sale of the steel

products from the proposed project, on an exclusive basis.

Wei Hua shall carry out its feasibility for the steel market in India from a technical, financial

and legal perspective, with reasonable assistance from NSL where sought by Wei Hua.

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Wei Hua shall provide the equipment for the proposed project delivered free of charge and

as per a mutually-acceptable delivery schedule.

NSL and Wei Hua shall jointly discuss and finalise JV shareholder and operating agreements

in a timely manner, post completion of feasibility studies and shall collectively approach and

apply for financing from Asian Infrastructure Investment Bank.

NSL and Wei Hua shall ensure that the proposed project results in enhancing the welfare of

the local community and economic and social development in the area of the proposed

project.

The binding agreement is valid for a period of 12 months from the commencement date, or

as extended by the parties in writing; or either party may terminate this agreement by giving

a notice of 30 days to the other Party.

MEMORANDUM OF UNDERSTANDING WITH ANDHRA PRADESH GOVT

During the Quarter, the Company further progressed actions pertaining to the Memorandum

of Understanding (MoU) with the Government of Andhra Pradesh (GoAP) for collaboration in

the mining, beneficiation and value addition of low grade iron ores that are abundant in the

State.

Over the past 12 months the Company has executed agreements with both the GoAP and

the Andhra Pradesh Mineral Development Corporation (APMDC), the State owned enterprise

charged with maximising utilisation of mineral resources.

The scope of the MoU is to define a collaboration between the Company and Andhra

Pradesh, whereby the Company will work with APMDC in the reconnaissance and exploration

for minerals in the State. The Company has also agreed to provide state of the art testing,

process flow development and technology for the setting up of value addition plants such

as beneficiation and pellet plants for low grade iron ore located in the State of Andhra

Pradesh, an endeavour which the APMDC has agreed to assist.

To develop this MoU further both parties have been conducting detailed legal and technical

reviews of potential target projects within the State. This work is expected to accelerate

during the coming months.

Key Facts

During a World Bank survey in 2015 Andhra Pradesh was rated as #2 state in India for ease of

doing business.

The 15-year business plan sees an expected 14% growth rate projected out to 2029 for the

State, based on an aggressive infrastructure program including airports, ports, highways and

a new greenfield Capital City located at Amaravati.

The State has implemented a dedicated single window process for investments and projects,

with a guaranteed 21-day approval timeframe for all state permissions.

Two major initiatives that will impact on the State are the Vizag – Chennai and Bangalore –

Chennai infrastructure corridors. The Asian Development Bank (ADB) is supporting the AP

Govt in the development of the Vizag - Chennai corridor. The $900 m project will have $700

m funded by the ADB and $200 m to be provided by the State Govt. This linkage is part of the

much larger Pan Asia land bridge connecting India to China and South East Asia.

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State GDP US$8 Billion

Per Capita Income $1,500

Capital City Amaravati

Largest City Visakhapatnam

Cities with more than 1m people 27

KURNOOL IRON ORE BENEFICIATION PLANT

PHASE TWO WET PLANT

During the quarter, the Company, as the only Australian or foreign company to own and

operate in India’s massive iron ore market continued to progress is Phase Two wet

beneficiation project.

Huate Engineers Site Visit

The Company hosted a team of engineers from equipment provider Shandong Huate Magnet

Technology Co. Ltd or Huate Magnetism (Huate), one of China’s premier global beneficiation

plant suppliers (refer http://www.chinahuate.com/).

Huate Engineers visiting NSL plant

The team from Huate inspected the plant location and assisted NSL with the appointment of lead

engineers, Design Tribe, to provide the detailed engineering design enabling the generation of

final construction plans.

The visit has also allowed planning of fabrication and shipping schedules for the plant from China.

The Huate team participated in a final risk assessment between Huate, Design Tribe and NSL prior

to excavation and site civil works commencing.

During the site inspection the Huate team were also able to inspect NSL’s pipeline of future

projects to better understand the growth profile for the Kurnool district and the potential to

upscale the technology.

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http://www.chinahuate.com/

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Team inspecting mining projects

Post the delivery of all Huate equipment to port, Huate will change its focus from equipment

fabrication to that of construction and commissioning. To assist the Company, a specialist

team of Mechanical Engineers, Electrical Engineers, Process Engineers, Ball mill specialists and

WHIMS specialists will be on site during this phase. The specialist team will remain on site until

completion of construction and commissioning of the wet beneficiation plant.

Huate Wet Plant equipment

During the quarter, significant steps forward continued to be achieved with NSL’s Managing

Director, Mr Cedric Goode, visiting China as part of the inspection and verification process

for the first, second and third delivery of equipment under the equipment supply agreement.

The equipment had been fabricated and tested, with shipping commencing from Qingdao

port to Krishnapatnam port in accordance with the previously announced timeline.

Importantly, the first and second stage delivery equipment also arrived at the Indian port,

and successfully moved through the customs clearance process.

Final testing, quality inspection and verifications were conducted by SGS Industrial Services in

the presence of NSL and Huate.

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LIMS Magnetic Separator equipment ready for final inspection

Electromagnetic Feeder equipment ready for final inspection

Equipment in fabrication

Equipment in fabrication

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Water filtration equipment painted post testing and ready for packing

Magnetic separation equipment painted post testing and ready for packing

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Magnetic separation equipment control panel post testing and ready for packing

Water filtration equipment control panel post testing and ready for packing

Ball mill equipment in final stages of fabrication

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Ball mills being prepared for shipping

Classifiers being prepared for shipping

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Liquid Resistor Starters and high voltage switch panels being prepared for shipping

Ball mill loading

A group of containers departing factory

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Huate Wet Plant Agreement Details

Huate is a specialised beneficiation plant supplier, and is unique in China in that it has

capability in plant design, fabrication, construction, commissioning and supporting

operations of entire large scale beneficiation plants. Huate also has global experience in iron

ore beneficiation, including in Australia.

The agreement with Huate further supports the confidence in the Company’s Indian iron ore

projects and the larger scale Indian iron ore industry, an industry in which Huate desires to

gain a position.

As highlighted in previous announcements the commercial terms as follows:

Capital cost: US$1,054,000 (excluding duties)

Payment 1 Payment 2 Payment 3 Payment 4 Payment 5 Payment 6 Payment 7

On

Execution -

COMPLETED

Stage 1

Delivery -

COMPLETED

Stage 2

Delivery

COMPLETED

Stage 3

Delivery

COMPLETED

Within 30

working

days post

Stage 3

delivery

Within 120

calendar

days post

Stage 3

delivery

Within 180

calendar

days post

Stage 3

delivery

25%

Contract

Value

25% Stage

1

equipment

value

25% Stage

2

equipment

value

25% Stage

3

equipment

value

20%

Contract

Value

15%

Contract

Value

15%

Contract

Value

Mar 16 Apr 16 May 16 Jun 16 Sept 16 Dec 16 Feb 17

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Site and Infrastructure

During the quarter, various site and infrastructure works commenced. Construction of the site

office expansion was completed, and site infrastructure moved towards completion in readiness

for the civil foundation works.

Office second storey construction

Office second storey construction

Retaining wall buttress construction

The civil foundation work commenced and were well progressed with foundation excavations

being completed. Concrete pouring also commenced and continued to progress on schedule.

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Sequential Site Images Showing Construction Progress

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Foundation works concreting progression

Foundation works concreting progression

To mark the official commencement of the construction phase of the project, the Company

celebrated the official launch of the Phase Two wet beneficiation plant project with a Puja (a

prayer ritual performed by Hindus to celebrate an event). The Puja was attended by

approximately 130 people from the Company, village elders and regional bureaucrats.

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Puja Celebrations of breaking first ground for civil works

Phase Two will be a wet beneficiation process, allowing NSL to produce a high grade

premium price iron ore product grading between 58-62% Fe at around 200,000 tonnes p.a.

The Phase Two wet beneficiation plant proposed for the existing NSL stockyard will be fed

material from NSL’s Kuja and Mangal mines.

Phase Two wet plant anticipated economics:

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AP 26 & 27

As previously announced, the Company was able to support its important wet beneficiation

production expansion plans by gaining access to additional mining leases, designated AP26 and

AP27, through a Run of Mine (ROM) royalty based agreement.

The Company entered into a Heads of Agreement (HOA), binding on the Lessee, whereby the

Lessee agrees to grant the Company exclusive operation and management rights over the

subject mining assets for a period equal to the length of the Mining Lease and any extensions

thereto.

AP26 and AP27 are mining leases of a combined 100 acres. They are located in the district of

Kurnool, and importantly only 1.5 kms and 9 kms from NSL’s existing stockyard and its beneficiation

plants.

AP26 and AP27 are located in the same geological basin as the NSL owned Kuja and Mangal

mining leases and as such, the geology and beneficiation characteristics are similar in nature and

contain a significant quantity of iron ore material amenable to NSL’s processes.

During the quarter, the Company continued to develop the recently secured AP26 and AP27

projects. The Company has been engaged in a detailed legal and technical due diligence

program on both projects, which has included conducting geomagnetic surveys and surface

sampling of both projects.

Work will continue into the next quarter, with the Company anticipating final agreement

documents to be executed on successful completion of the due diligence program.

The AP26 and AP27 projects represent opportunities both to enhance the current wet plant

project and allow for significant future growth plans.

AP26 and 27 pit workings

AP 14 MINING LEASE

During the quarter, the Company continued to work with the Indian Government to progress

the grant of AP14 through Delhi. Specifically, the Company made detailed representations

to the Prime Minister’s Office Project Monitoring Group (PMG) during a planning workshop

held in Hyderabad.

Upon approval from the Central Government the Company will then be able to undertake

further exploration activities, including drilling operations on the lease. Work continues on the

development of the exploration program scope, including pre work on preferred supplier

sourcing.

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CORPORATE

ARBITRATION AWARD

As announced on 20 August 14, the Arbitration between its wholly owned subsidiary, NSL

Mining Resources India Private Limited (“Claimant”) and Mega Logistics and Solutions

(“Respondent“) has now been concluded, with the arbitrator giving the award entirely in

favour of the Claimant.

The award given was for approximately A$250,000 which is related to unrecovered advances

(plus interest) paid to Mega Logistics and Solutions for the provision of transport and related

services.

During the quarter, the Company continued to further progress the recovery of the award.

SUPREME COURT WRIT OF SUMMONS

As announced on 16 February 2015, the Company received a writ of summons in relation to

a Coal Acquisition Agreement dated 15 June 2011 with Birmanie Nominees Pty Ltd (the

vendor under the agreement, Birmanie) relating to 4 coal EPCs in Queensland.

The writ alleges that NSL has failed to meet various obligations under the Coal Acquisition

Agreement. Birmanie has claimed $2.5m in damages.

NSL has subsequently lodged its defence, in which it vigorously denies Birmanie’s Claim. The

Company is of the view that Birmanie is not entitled to the damages sought or to any other

damages.

During the quarter, in line with the view above, the Company continued with the litigation

process.

MAGNA A$5M SENIOR SECURED LOAN

As announced on 13 August 2015, the Company entered into a conventional secured

funding loan agreement totalling A$5 million to allow the construction, commissioning and

operation of its Phase Two wet beneficiation plant, while also availing the recommencement

of the existing Phase One dry beneficiation plant at its wholly-owned Kurnool iron ore

processing stockyard.

Magna has previously provided loan support for NSL’s iron ore growth strategy in India.

As at 30 June 16, the Company had utilised A$1,100,000 towards its operations/development

and general working capital.

During the quarter, the Company continued loan repayments in accordance with the terms.

POTENTIAL ACQUISITIONS

The Company continued to progress opportunities for either outright acquisition, royalty

based acquisition and/or joint venture farm in structured agreements over multiple projects

in India. These assessments remain ongoing.

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GENERAL MEETING

As announced on 18 April, the Company held a General Meeting of Shareholders. All

resolutions were unanimously carried on a show of hands.

CASH FLOW – APPENDIX 5B

At the commencement of the quarter, the Company had an opening cash balance of

approximately $1,245,000. The closing cash balance for the quarter ending 30 June 2016 was

approximately $919,000.

INTERESTS IN MINING TENEMENTS

Project/Tenements Location Held at end of quarter

Acquired during the quarter

Disposed during the quarter

Kuja Andhra Pradesh, India

100% - -

Mangal Andhra Pradesh, India

100% - -

AP14 Andhra Pradesh, India

100% - -

EPC 2198 Queensland, Australia

100% - -


100% - -


100% - -

EPC2338 Queensland, Australia

100% - -

Regards

NSL Consolidated Limited

Cedric Goode

Managing Director/CEO

For more information:

Cedric Goode Kevin Skinner

NSL Consolidated Field Public Relations

Managing Director/CEO

+61400 408 477 (08) 8234 9555 / 0414 822 631

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Appendix 5B

Mining exploration entity quarterly report

+ See chapter 19 for defined terms.

Appendix 5B Page 1

782Rule 5.3

Appendix 5B Mining exploration entity quarterly report

Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.

Name of entity

NSL Consolidated Limited

ABN Quarter ended (“current quarter”)

32 057 140 922 30 June 2016

Consolidated statement of cash flows Cash flows related to operating activities

Current quarter $A’000

Year to date (12 months) $A’000

1.1 Receipts from product sales and related debtors

11

24

1.2 Payments for (a) exploration and evaluation (b) development (c) production (d) administration (Aust, Sing & India)

-

(119) -

(652)

(18) (301)

- (1,855)

1.3 Dividends received - - 1.4 Interest and other items of a similar nature

received 3 4

1.5 Interest and other costs of finance paid - (50) 1.6 Income taxes paid - - 1.7 Other - -

Net Operating Cash Flows

(757)

(2,196)

Cash flows related to investing activities

1.8 Payment for purchases of: (a) prospects (b) equity investments (c) other fixed assets

- -

(555)

- -

(901) 1.9 Proceeds from sale of:

(a) prospects (b) equity investments (c) other fixed assets

- - -

- - -

1.10 Loans to other entities - - 1.11 Loans repaid by other entities - - 1.12 Other (provide details if material)

- -

Net investing cash flows

(555)

(901)

1.13 Total operating and investing cash flows (carried forward)

(1,312)

(3,097)

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Appendix 5B



Appendix 5B Page 2

1.13 Total operating and investing cash flows (brought forward)

(1,312)

(3,097)

Cash flows related to financing activities

1.14 Proceeds from issues of shares, options, etc.

1,193

3,150

1.15 Proceeds from sale of forfeited shares - - 1.16 Proceeds from borrowings - 1,007 1.17 Repayment of borrowings (203) (266) 1.18 Dividends paid - - 1.19 Other

- -

Net financing cash flows

990

3,891

Net increase (decrease) in cash held

(322)

794

1.20 Cash at beginning of quarter/year to date 1,245 198 1.21 Exchange rate adjustments to item 1.20 (4) (73)

1.22 Cash at end of quarter

919

919

Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities

Current quarter $A'000

1.23

Aggregate amount of payments to the parties included in item 1.2

102

1.24

Aggregate amount of loans to the parties included in item 1.10

NIL

1.25

Explanation necessary for an understanding of the transactions

Wages, superannuation and car lease.

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

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Appendix 5B



Appendix 5B Page 3

Add notes as necessary for an understanding of the position.

Amount available $A’000

Amount used $A’000

3.1 Loan facilities *

5,000,000

1,100,000

3.2 Credit standby arrangements

- -

* Relates to the MG Partners II Ltd A$5M secured loan agreement as announced on 13 August 2015. Refer to announcement on 13 August 2015 for key terms to the transaction.

Estimated cash outflows for next quarter **

$A’000

4.1

Exploration and evaluation 9

4.2 Development (inc PPE)

1,473

4.3 Production

-

4.4 Administration (Aust, Sing & India) ***

902

Total

2,384

** Not included above, are cash inflows for the next quarter in relation to sales of product produced through the Phase Two wet plant commissioning phase and production. *** Increase in forecast administration outflows, due to increased activity and resources in India associated with the commencement of the Phase Two wet plant project, and due to repayments associated with the Magna secured loans during the Sept 16 qtr.

Reconciliation of cash

Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.

Current quarter $A’000

Previous quarter $A’000

5.1 Cash on hand and at bank **** 919 1,245

5.2 Deposits at call - -

5.3 Bank overdraft -

-

5.4 Other - -

Total: cash at end of quarter (item 1.22) 919 1,245

**** Not included above, is approximately $559k in proceeds from option conversions received subsequent to the quarter, and $3.4m raised through the Placement announced on 22 July 2016.

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Appendix 5B



Appendix 5B Page 4

Changes in interests in mining tenements Tenement

reference Nature of interest

(note (2)) Interest at beginning of quarter

Interest at end of quarter

6.1 Interests in mining tenements relinquished, reduced or lapsed

-

-

-

-

6.2 Interests in mining tenements acquired or increased

-

-

-

-

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Appendix 5B



Appendix 5B Page 5

Issued and quoted securities at end of current quarter (continued) Description includes rate of interest and any redemption or conversion rights together with prices and dates.

Total number Number quoted

Issue price per security (see note 3)

Amount paid up per security (see note 3)

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

1,378,886,239 1,378,886,239

7.4 Changes during quarter

(a) Increases through issues

(b) Exercise of options (c) Decreases through return of capital, buy-backs (d) Increase pursuant to underwriting of options

227,509,987

21,875,000 - -

15,454,766

21,875,000 - -

$0.008

$0.01

-

-

$0.008

$0.01 - -

7.5 +Convertible debt securities (description)

1

-

US$2.5M

US$2.5M

7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted

- - - -

7.7 Options (description and conversion factor)

548,208,886

177,000,000

10,000,000

548,208,886 -

-

Exercise price

$0.01

$0.0096

$0.03

Expiry date

31/12/2016

31/12/2016

14/08/2018

7.8 Issued during quarter

232,590,218

232,590,218

$0.01

31/12/2016

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Appendix 5B



Appendix 5B Page 6

7.9 Exercised during quarter

21,875,000

21,875,000

$0.01

31/12/2016

7.10 Expired/Forfeited during quarter

-

-

-

-

7.11 Debentures

(totals only) - -

7.12 Unsecured notes (totals only)

- -

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Appendix 5B



Appendix 5B Page 7

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 /does not* (delete one) give a true and fair view of the matters disclosed.

Sign here:.............Sean Henbury.............. Date: 29 July 2016 (Company Secretary)

Print name: Sean Henbury 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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For personal use only - ASX · 7/29/2016 · Offtake agreements are already in place with India’s JSW Steel and BMM Ispat for Phase Two product. QUARTERLY ACTIVITIES REPORT For