thomson
Annual Report 2016
RESOURCES
Contents
Chairman's Report 1
Review of Operations 2
Schedule of Tenements 7
Directors' Report 8
Consolidated Statement of Comprehensive Income 15
Consolidated Statement of Financial Position 16
Consolidated Statements of Cash Flows 17
Consolidated Statement of Changes in Equity 18
Consolidated Notes to the Financial Statements 19
Directors' Declaration 39
Independent Auditors Report 40
Additional Information 42
Upper Photograph: Drilling at Bygoo North
Lower Photograph: Historic processing equipment at Big Bygoo
Chairman's Report
Dear Shareholder
On behalf of the Board of Directors, I am pleased to present the sixth Annual Report of Thomson Resources Ltd.
Thomson has continued with a quality exploration program on its high value opportunities in New South Wales. The initial focus was on the Thomson Fold Belt where the Company discovered a number of large Intrusive-Related Gold (IRG) systems. Thomson has more recently shifted to opportunities that might provide a more immediate cash flow for the company, with tin a particular commodity of focus. The Company continues to see a favourable outlook for tin and recent price movements have borne out this faith. NSW is arguably one of the best regions for tin exploration given its historic production and diverse geological potential.
Its key area of attention has been the Bygoo project, located just north of NSW's once largest tin mine at Ardlethan. The Company has so far conducted three drill programs, each successfully intersecting high-grade mineralisation in a greisen zone at the margin of the Ardlethan granite. Outstanding intercepts including 35m at 2.1% Sn and 13m at 1% Sn were recorded at Bygoo North, representing some of the best drill intersections recorded in grass-roots tin exploration in Australia for some years. The greisen zone is open east, west and down dip, and further drilling is planned.
At the Bygoo South prospect, located 400m south of Bygoo North, Thomson also has had success, with a shallow intersection of high-grade tin mineralisation under old workings. The gap zone between Bygoo North and Bygoo South requires testing as does Big Bygoo prospect 1.5km to the south. It is clear that the contact zone between the Ardlethan Granite and volcanic rocks under the Thomson exploration licence is a very important mineralised corridor which the Company intends focussing a significant proportion of its future exploration effort.
Elsewhere, the Company entered a farm-in and joint-venture agreement with Silver City Minerals Limited in August 2016 over its Wilga Downs project. The project is considered an excellent copper target, with a ground geophysical survey by Thomson generating a VTEM conductor in comparable rocks to the Tritton copper mine to the south.
Thomson is indeed pleased to work with Silver City Minerals to ensure that this exciting copper target is tested in the near future. Once Silver City earns an 80% interest, Thomson will be free-carried until commencement of a definitive feasibility study when both companies will contribute to expenditures pro-rata. The above arrangement will allow Thomson to focus on its Bygoo tin project.
Also during the year, Thomson joint ventured a number of other projects including its Havilah prospect with potential VMS mineralisation in Silurian volcanic rocks to Silver Mines Ltd (ASX:SVL) and its Mullagalah prospect (EL8102) to a private investor who has now earned a 50% interest in the tenement.
Thomson was granted EL 8392 in southern NSW during the year which covers the significant tin-tungsten mineral system at Mt Paynter. It was also encouraging to receive news in August 2016 that the NSW Government will provide drilling assistance to test the Mt Jacob and Cuttaburra IRG targets.
Beer & Co Equity Research recently issued a research report on the Company. Beer and Co recommended Thomson as a Speculative Buy on the basis of the good tin results from Bygoo and Beer's confidence in an increasing tin price.
The Company is also constantly on the lookout for funding opportunities and alert to joint-venture projects that will add to the Company's exploration portfolio and to shareholder value. The exploration industry has experienced a very difficult time in recent years and the junior exploration sector has been particularly affected. 2016 has seen some resurgence in confidence in the mining sector, particularly in relation to gold and it may be that the industry is turning the corner and capital will be more readily available in 2017 to support our ongoing exploration program.
The Board acknowledges and thanks the strong shareholder support it has received and the confidence in the Company's Board and management. I would particularly like to acknowledge both the Company's Board and Management for their strong commitment and dedication. Our CEO, Mr Eoin Rothery, continues to play a critical role in our endeavours to discover and develop a new mine.
Lindsay Gilligan PSM
Chairman
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> Thomson Resources Ltd Annual Report 2016
Review of Operations
Project Activities
Thomson Resources has had a very successful year, with significant progress on the Bygoo tin discovery. Three rounds of drilling generated a number of high grade tin intersections and modelling has allowed the estimation of an Exploration Target (as defined in the JORC Code, 2012) for Bygoo. The Exploration Target estimated is 0.9 to 1.44 million tonnes of ore at 0.8% to 1.4% Sn (7,200 to 20,100 tonnes of contained tin). The potential quantity and grade is conceptual in nature, there has been insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in the estimation of a Mineral Resource. The Exploration Target is based on Thomson Resources drilling as detailed in public reports. Drilling is planned to test the validity of this Target and to convert it to resource status.
To allow Thomson to focus on its Bygoo discovery, the Company has engaged additional new joint-venture partners for three of its projects, including the airborne VTEM anomalies at Byrock and Havilah. In a challenging investment climate these achievements have been made with minimal cash outlay or share dilution, leaving Thomson well positioned to take these projects to the next phase.
Thomson Resources is exploring in NSW for mineral deposits containing gold, tin and copper. Thomson had early success in discovering several Intrusion-Related Gold (IRG) systems in its namesake Thomson Fold Belt of northwestern NSW. Tin is commonly associated with IRG systems and Thomson Resources has used this experience to enhance its tin focus with the acquisition of the advanced tin exploration project at Bygoo near Ardlethan.
Figure 1: Thomson Resources Projects
The Ardlethan Tin Field
The Bygoo prospects occur near the eastern edge of the Ardlethan granite which appears to control a number of tin and tungsten occurrences (Figure 2), including the various deposits developed by the Ardlethan Mine. This mine was the most substantial producer in NSW with recorded production of 25,000 tonnes of tin in concentrate from open cut and underground operations between 1964 and 1986. Thomson's EL includes some of the remaining potential at Ardlethan, although the Mine Leases are excluded.
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> Thomson Resources Ltd Annual Report 2016