Sundance Resources Limited
ABN 19 055 719 394
and subsidiaries
Annual Report 2016
CORPORATE DIRECTORY
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Directors:
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Wal King (Chairman & Non-Executive Director)
Giulio Casello (Managing Director & Chief Executive Officer) Alan Rule (Non-Executive Director)
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Company Secretary:
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Carol Marinkovich
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ABN:
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19 055 719 394
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Registered Office:
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45 Ventnor Avenue West Perth WA 6005
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Head Office:
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45 Ventnor Avenue West Perth WA 6005
PO Box 497
West Perth WA 6872
Tel: +61 (8) 9220 2300
Email: [email protected] Internet: www.sundanceresources.com.au
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Auditors:
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Deloitte Touche Tohmatsu Level 2, Brookfield Place 123 St George's Terrace Perth WA 6000
PO Box A46
Perth WA 6837
Tel: +61 (8) 9365 7000
Fax: +61 (8) 9365 7001
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Share Registry:
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Computershare Investor Services Pty Ltd
Level 11
172 St George's Terrace Perth WA 6000
GPO Box D182
Perth, WA 6840
Tel: (within Australia) 1300 850 505
(outside Australia) +61 (3) 9415 4000
Fax: +61 (8) 9323 2033
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CHAIRMAN'S REPORT
Dear Shareholder,
After increasing resources, reserves and overall project capacity and reducing forecast operating costs in early 2015, we started the 2016 financial year by signing the Transition Agreement with the Cameroon Government, which passed on responsibility for the construction and funding of the port and rail components of the Project to the Cameroon Government.
Following the Transition Agreement milestone, we completed marking the railway corridor and provided technical support to the Cameroon Government for the development of an EPC contract ready for signature with a Chinese contractor selected by the Government.
We were also pleased when the Nabeba convention was passed into law by the Republic of Congo in May this year.
Those positive developments have been countered to some extent by the emergence of a number of issues that have required management but have not been such that they might prevent us from continuing to progress the company and its objectives.
Both the loss of the trial in the Supreme Court of Western Australia in December 2015 and the delay in the signing of the Mbalam-Nabeba EPC contract required immediate action by the Board and management of Sundance.
Full details of each of these events can be found elsewhere in this report. In response to the problems they presented, we significantly reduced our costs through staff and Board reductions, settled the litigation we lost and performed a rights issue to raise short term funds.
Recent media allegations regarding events in the Congo between 2006 and 2008 have also been addressed. We have engaged an independent legal team to determine the veracity of the allegations and are working cooperatively with the Australian Federal Police, which is conducting a separate investigation of the events.
At this point in time, we are unable to pre-empt what conclusions might be reached in either investigation.
Even though we have seen recovery and stabilisation in the iron ore market over recent months, the more dramatic prior collapse in prices has undoubtedly made it more challenging to attract the funding to build a multibillion dollar enterprise such as Mbalam-Nabeba.
We continue to see that in the longer term the need for high quality iron ore will only increase and the Mbalam- Nabeba Project is still arguably the best project to satisfy the needs of the steel industry in China and elsewhere over the timeframe. These observations drive our unwavering belief that our Project will be developed.
We continue to work with all of our stakeholders to ensure that Sundance is sustainable and in a position to capture this upside whenever it presents itself, either in the short or longer term.
Wal King Giulio Casello
Chairman & Non-Executive Director CEO & Managing Director
MINERAL RESOURCES & ORE RESERVES
MINERAL RESOURCES
The Mineral Resources Statement for the Mbalam-Nabeba Iron Ore Project as at 30 June 2016 is summarised in Table 1 and 2 below.
HIGH GRADE HEMATITE RESOURCES
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Deposit
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Mineralisation
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Resource Category
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Tonnes
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Fe
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SiO2
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Al2O3
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P
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LOI
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(Mt)
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(%)
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(%)
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(%)
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(%)
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(%)
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Mbarga (All Deposits)
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High Grade Hematite
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Indicated
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230.9
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56.5
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13.0
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3.4
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0.08
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2.2
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Inferred
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28.8
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56.6
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16.4
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2.9
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0.08
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1.3
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Nabeba (All Deposits)
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Indicated
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545.9
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57.6
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7.2
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4.8
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0.11
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4.6
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Total High Grade Hematite Resources
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Total
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805.7
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57.3
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9.2
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4.3
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0.10
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3.8
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Table 1 Total High Grade Hematite Mineral Resources of Mbalam-Nabeba Iron Ore Project
ITABIRITE HEMATITE RESOURCES
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Deposit
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Mineralisation
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Resource Category
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Tonnes
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Fe
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SiO2
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Al2O3
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P
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LOI
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(Mt)
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(%)
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(%)
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(%)
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(%)
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(%)
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Mbarga (All Deposits)
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Itabirite Hematite
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Indicated
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1,846
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34.6
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47.7
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1.5
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0.04
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0.6
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Inferred
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2,078
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31.8
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48.6
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2.9
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0.05
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1.3
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Nabeba (All Deposits)
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Inferred
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1,714
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34.1
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42.3
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2.7
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0.05
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2.6
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Total Itabirite Hematite Resources
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Total
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5,638
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33.4
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46.4
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2.4
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0.05
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1.5
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Table 2 Total Itabirite Hematite Mineral Resources of Mbalam-Nabeba Iron Ore Project
ORE RESERVES
The Ore Resources Statement for the Mbalam-Nabeba Iron Ore Project as at 30 June 2016 are summarised in Table 3 with further details of Ore Reserves released to ASX on 20 May 2015.
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Deposit
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Reserve Category
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Tonnes of Product
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Fe in Product
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SiO2 in Product
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Al2O3 in Product
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P in Product
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LOI in Product
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(Mt)
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(%)
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(%)
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(%)
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(%)
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(%)
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Mbalam (All Deposits)
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Probable
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154
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62.9
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5.16
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2.81
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0.08
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2.3
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Nabeba (All Deposits)
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Probable
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363
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61.9
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4.17
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2.79
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0.10
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3.7
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Total
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Probable
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517
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62.2
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4.46
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2.80
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0.09
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3.3
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Table 3 Total High Grade Hematite Ore Reserves of Mbalam-Nabeba Iron Ore Project
Note: Ore Reserves are classed as Probable, based on the conversion of Indicated Mineral Resource. Ore Reserves represent the estimated saleable product. The product is 100% fines.
