Highlights - content.stockpr.comcontent.stockpr.com/peakresources/media/add6e7b722c14d9c2869… ·...
Transcript of Highlights - content.stockpr.comcontent.stockpr.com/peakresources/media/add6e7b722c14d9c2869… ·...
Quarterly ReportSeptember 2012
DEVELOPING A NEW RARE EARTH DISCOVERY
Peak Resources Limited Level 2, 46 Ord Street, West Perth, Western Australia 6005. PO Box 603, West Perth, Western Australia 6872. ASX: PEK OTCQX: PKRLY ACN 112 546 700 Telephone: +61 8 9200 5360 [email protected] www.peakresources.com.au
Non-Executive Chairman: Alastair Hunter Managing Director: Richard Beazley Technical Director: Dave Hammond Non-Executive Director: Jonathan Murray Company Secretary: Farlee Walker
HighlightsPeak Resources Limited (Peak; ASX: PEK; OTCQX: PKRLY), is developing its Ngualla Rare Earth Project discovery into a
potentially low cost, long term producer. Ngualla in Tanzania is the world’s fifth largest rare earth deposit outside of China.
Activity highlights this Quarter include:
• Asignificantmilestonereachedaheadofschedulewithmetallurgical‘ProofofConcept’successusingthe
selectedsulphuricacidleachprocessonsamplesofweatheredbastnaesitemineralisationfromthecoreofthe
SouthernRareEarthZone(SREZ).
• Arareearthcarbonateconcentratewasproducedgrading50.3%REOatanoverallprocessrecoveryof87%.
• Theconcentrateisahighqualityproductwithverylowuraniumandthoriumcontentsofjust7ppmand12ppm
respectively.
• ThesehighlyencouragingresultssupporttheCompany’sviewthatthisnearsurface,highgradestyleof
mineralisationwithinthelargerNguallaDepositholdsthebestpotentialfortheinitialandrapiddevelopmentofa
lowcostrareearthmine.
• TheScopingStudy,whichwillincludeapreliminaryeconomicassessmentoftherareearthproject,isonbudget
andscheduleforcompletioninDecember2012.
• TheStudywillalsoincludeestimatesforasolventextraction(SX)separationplanttoproducearangeofhigh
purityrareearthoxideproducts.
• Peakhascommencedpreliminarydiscussionswithanumberofinterestedpartiesregardingpotentialofftake
agreements.
• Highgraderareearthmineralisedintersectionshavebeenreturnedfromthemajorinfilldrillingprogramin
progressintheSREZandinclude:
NRC168: 151m at 5.15%REO from surface to end of hole
NRC176: 140m at 5.21%REO from surface to end of hole
NRC180: 102m at 5.51%REO from surface to end of hole
NRC183: 127m at 5.15%REO from surface to end of hole
NRC195: 160m at 5.25%REO from surface to end of hole
NRC220: 95m at 5.44%REO from surface and 15m at 5.98%REO from 98m to end of hole
*REO = Total Rare Earth Oxide. See Table 3 for drill intersection details and Table 2 for individual rare earth distribution.
These wide intersections confirm the continuity and consistency of the outcropping rare earth mineralisation in the heart of the
deposit targeted for first development and production. The latest results include the highest grades and the deepest zones of
weathering and enriched rare earth mineralisation from the project to date. Mineralisation still remains open at depth and to
the south.
• The Company had $8.35 million cash on hand at the end of the Quarter.
2
Quarterly Report September 2012
Figure 2: Maiden Mineral Resource block model coloured by REO % grade and drill holes (as at maiden Mineral Resource, 29th February 2012) on satellite image draped over topography, Ngualla Carbonatite.
NGUALLA RARE EARTH PROJECT, TANZANIA
Rare Earths, Niobium – Tantalum, Phosphate. Peak Resources – 100%
BackgroundThe Ngualla Rare Earth Project is a recent discovery with the first intersections in the
Southern Rare Earth Zone (SREZ) reported in September 2010. The maiden Mineral
Resource of 170 million tonnes at 2.24% REO* was announced just 18 months later on
29th February 2012 and ranks as the fifth largest rare earth deposit in the world outside
of China.
The total resource includes a higher grade, near surface zone of:
40milliontonnes at 4.07%REO for 1.6milliontonnesofcontainedREO.
(*REO = total rare earth oxides including yttrium. See Table 1 for Mineral Resource classification details)
Ngualla has several fundamental geological aspects that offer distinct advantages for development over other rare earth
projects. These include the large size of the deposit, the outcropping, high grade mineralisation amenable to open cut mining
with low strip ratios, favourable mineralogy for processing and the lowest uranium and thorium levels of any major rare earth
deposit in the world.
Peak continues to make rapid progress towards developing Ngualla into a low cost rare earth producer by early 2016.
Metallurgical Process DevelopmentIn early August 2012 Peak announced the successful demonstration of a simple metallurgical flow sheet resulting in a high grade,
high purity rare earth carbonate product from samples of weathered bastnaesite mineralisation from the SREZ at Ngualla (Figure
2). A simple sulphuric acid leaching process on a composite sample returned an overall process recovery of 87% and a high grade
(50.3% REO), high purity rare earth carbonate product containing just 7ppm uranium and 12ppm thorium.
Figure 1: Location of Peaks 100% owned Ngualla Project in Tanzania
!Mbeya
Dar Es Salaam
UGANDA
KENYA
ZAMBIA
MALAWI
Lake Victoria
Indian Ocean
Lake Rukwa
Ngualla Project
Lake Nyasa
T A N Z A N I A
N
400km0 100 200
Block Model REO%
A 1 to 2%
A 2 to 3%
A >3%
! Drill holes A Bastnaesite Zone
OPEN OPEN
OPEN
Perim
eter
of Carbonatite
Northern Zone
South West Alluvials
550m
Mt Mapuma
Bastnaesite Zone Southern Rare Earth Zone
Perim
eter
of C
arbo
natite
3
Quarterly Report September 2012
During the test work it was possible to selectively remove some of the cerium
at an early stage, producing a separate high grade concentrate of 65% cerium
oxide (Figure 3). Subsequent processing of the remaining sample produced a
cerium depleted (and therefore potentially higher value) rare earth carbonate
product grading 50.3% REO (see Photo right) with an overall total process
recovery from feed to rare earth product of 87%.
The removal of the majority of lower value cerium at the early stage provides
additional options in terms of products for further processing or sale and reduces
the size of plant required for later stages of the hydrometallurgical process.
These highly encouraging results support the Company’s view that this near
surface, high grade style of mineralisation within the larger Ngualla Deposit
holds the best potential for the initial and rapid development of a low cost rare
earth mine. The Company is progressing further metallurgical test work to
be completed by December 2012 to further optimise the rare earth recovery,
whilst minimising, sulphuric acid and other reagent consumption. This work
is generating valuable data for the current Scoping Study and future project
feasibility studies.
65% cerium oxide concentrate.
50.3% REO high grade rare earth carbonate .
Photographs of the high grade rare earth concentrates produced by the “Proof of Concept” metallurgical test work
SimplifiedSulphuricAcidLeachProcessandSXSeparation
LeachFeed
4.3% REO
5 High Purity
Oxide Products
Cerium Oxide65%
Sulphuric Acid Leach
Primary Precipitation
Carbonate Precipitation
Cerium Removal Purification
Oxidation
SX Separation
Rare Earth Carbonate Product
50% REO
Lanthanum Oxide
Cerium Oxide
Didymium Oxide
SEG Oxide
Heavy Rare Earth Oxide
Figure 3: Simplified process route for Ngualla bastnaesite mineralisation into three product streams: a) 5 refined high purity REO products b) mixed rare earth carbonate and c) cerium concentrate
A 1.6 tonne bulk composite sample of rare earth mineralisation from the bastnaesite core of the SREZ has been despatched
from site to Australia. Processing is now underway via the established flow sheet to provide feed stock for the next phase of
test work – separation via solvent extraction (SX) into five high purity concentrate products:
Lanthanum Oxide
Cerium Oxide
Didymium Oxide (praseodymium and neodymium)
SEG Oxide (samarium, europium and gadolinium)
Heavy Rare Earth Oxide (residual HREO including yttrium)
The successful production of these five high purity rare earth oxide products (Figure 3) will provide the company with further
benefits to the mixed carbonate concentrate already produced in terms of product value and available markets. Work
commenced on the preparation of a concentrate as a feed for this SX program in October 2012 and the five purified rare earth
oxide products will be produced by the end of the June Quarter 2013.
4
Quarterly Report September 2012
Sufficient quantities of each of the five purified products, as well as a mixed rare earth carbonate will be manufactured for
assessment by potential off take customers.
An additional five tonnes of weathered bastnaesite mineralisation will be despatched to Australian test laboratories in November,
before the end of the current field season, as feed material for a sulphuric acid leach pilot plant. The pilot plant will provide
detailed engineering data for input into project feasibility studies as well as demonstrating the robustness of the process over
extended periods of operation. Design of the pilot plant will commence in October with commissioning scheduled for Quarter
2 of 2013.
A metallurgical variability test program is currently in progress on an additional 111 samples of high grade weathered
mineralisation. This will further verify and quantify the leach efficiency of the selected sulphuric acid process from a range of
mineralogical styles across the SREZ. The results, expected in October 2012, will allow a predictive geometallurgical model
to be constructed based on geology and assay results. Previous samples of weathered mineralisation from within the central
bastnaesite zone, which extends over a 750m x 700m area (Figure 2), returned an average of 87% leach extraction using
sulphuric acid.
Scoping StudyPeak commenced the Ngualla Project Scoping Study in May 2012 with the appointment of engineer Lucas Stanfield as
Chief Development Officer, Perth based Emerson Stewart Consulting Group as infrastructure and environmental engineering
consultants, Hatch as process engineering consultants and Orelogy Pty Ltd as mining consultants to the study. The study is
to determine the optimum pathway to rare earth production and provide a preliminary economic assessment of the Project.
The base case for the Scoping Study assumes a range of rare earth products containing a total of 10,000 tonnes of REO
equivalent will be produced from an estimated 300,000 tonnes of ore at an average grade of approximately 4.3% REO annually
over an initial mine life of 25 years. The Mineral Resource has potential to support a significant increase to this base case
production rate should off take customers for additional product be secured.
ROM ORE
PRIMARY/SECONDARYORE CRUSHING
CRUSHED ROM ORE
RESIDUE FILTRATION
DS PRECIPITATIONCERIUM OXIDATION &CAUSTIC CONVERSIONACID DISSOLUTIONPURIFICATIONRARE EARTH CARBONATE
PRECIPITATION
IRON PRECIPITATIONWASTE
CERIUM SULPHATECONCENTRATE
CERIUM SULPHATECONCENTRATE
BAGGING
TO RESIDUE STORAGE FACILITY
(BY TRUCK)
SODIUM SULPHATESOLUTION
SODIUM HYDROXIDE SOLUTION
HYDROCHLORIC ACIDSODIUM HYDROXIDE SOLUTIONSODIUM CARBONATE SOLUTION
AIR
ACID P LANTSULPHUR
AIR
DEMINERALISEDWATER
SULPHURIC ACID
POWER G
STEAM
STEAMTURB INE
GENERATOR
CONDENSATE
TO RESIDUE STORAGE
RARE EARTH CARBONATE DRYING
RARE EARTH CARBONATE PACKAGING
DIESEL
RARE EARTH CARBONATE FILTRATION
SULPHATION LEACH
SULPHURIC ACID
MILLING
OVERSIZE AND/ORLOW GRADE
Bene�ciationProcess
Figure 4: Overall process flowsheet: Rare earth carbonate option.
5
Quarterly Report September 2012
The positive results from the ‘Proof of Concept’ sulphuric acid leach process has now lead the Scoping Study to identify that
the optimum approach for Ngualla is to focus initial production from the highest grade, near surface weathered bastnaesite
mineralisation within the core of the SREZ (Figure 2).
The Study will evaluate processing of this mineralisation via the sulphuric acid and precipitation route (Figure 4) into a mixed,
cerium depleted rare earth carbonate concentrate as one standalone option.
The study will also include estimates for a solvent extraction (SX) separation plant to produce a range of higher value, high
purity rare earth products in order to determine costs and benefits of different production pathways to best commercialise the
Ngualla Rare Earth Project.
The SX process flow sheet (Figure 5) is designed to produce five purified rare earth oxide products:
Lanthanum Oxide
Cerium Oxide
Didymium Oxide
SEG Oxide
Heavy Rare Earth Oxide
The Scoping Study is progressing well with the engineering design of both flow sheet options completed (Figures 4 to 5), and
the site infrastructure layout and designs (Figure 6) advanced.
ROM ORE
PRIMARY/SECONDARYORE CRUSHING
CRUSHED ROM ORE
RESIDUE FILTRATION
DS PRECIPITATIONCERIUM OXIDATION &CAUSTIC CONVERSIONACID DISSOLUTIONPURIFICATION
IRON PRECIPITATIONWASTE
CERIUM SULPHATECONCENTRATE
CERIUM SULPHATECONCENTRATE
BAGGING
TO RESIDUE STORAGE FACILITY
(BY TRUCK)
SODIUM SULPHATESOLUTION
SODIUM HYDROXIDE SOLUTION
HYDROCHLORIC ACIDSODIUM HYDROXIDE SOLUTION
AIR
ACID P LANTSULPHUR
AIR
DEMINERALISEDWATER
SULPHURIC ACID
POWER G
STEAM
STEAMTURB INE
GENERATOR
CONDENSATE
TO RESIDUE STORAGE
SULPHATION LEACH
SULPHURIC ACID
MILLING
OVERSIZE AND/ORLOW GRADE
Bene�ciationProcess
PRECIPITATIONPRODUCT 1 - SEG OXIDE(Samarium, Europium, Gadolinium)
PRODUCT 2 - HRE OXIDE(Terbium, Dypsrosium, Holmium, Erbium)
PRODUCT 3 - PT, Nd OXIDE(Praseodymium, Neodymium)
PRODUCT 4 - Ce OXIDE(Cerium)
PRODUCT 5 - La OXIDE(Lanthanides)
WASTE SOLUTION TO TREATMENT
SX EXTRACTION & STRIP
SX MIXER/SETTLERSTAGES
RARE EARTH SEPARATION PLANT (GENERALISED PROCESS FOR EACH PRODUCT)
FILTRA TION
CALCINATION
FILTRATE
Figure 5: Overall process flowsheet: Rare earth separation – 5 purified REO products option.
6
Quarterly Report September 2012
Figure 6: Ngualla on site processing plant design for Scoping Study, for production of a rare earth carbonate concentrate.
A number of site visits have been completed including communication with Tanzanian Government Departments, potential
suppliers, consultants and contractors and the Scoping Study is on track for completion on schedule and budget in December
2012.
Development scheduleThe Company has an accelerated development schedule for Ngualla compared to many other rare earth projects with first
production of rare earth concentrate product planned for early 2016. Key indicative milestones include:
Indicative Development Schedule
Completion of Scoping Study December 2012
Construction of Pilot Plant completed February 2013
Updated Mineral Resource estimate March 2013
Commence Pre-Feasibility Study Quarter 1 2013
Commence Definitive Feasibility Study Quarter 1 2014
Commence mine and processing plant construction 2015
First production Early 2016
7
Quarterly Report September 2012
Off take PartnersThe Company has commenced discussions with a number of interested parties regarding potential off take agreements for
rare earth concentrate products from Ngualla. Several organisations have expressed in principle interest during early stage
discussions. The Company will keep the market informed of developments.
Ngualla Drilling Program 2012A series of high grade rare earth mineralised intersections were received during the Quarter from the drilling program in
progress at Ngualla that commenced after the end of the rainy season, on 24th May 2012.
Drilling operations are continuing on site to infill the area of the SREZ targeted for first rare earth production. An estimated
14,000m is planned during 2012 to provide information and samples to support the metallurgical test work currently in progress
and feasibility studies due to commence in 2013.
The objectives of the drilling program are to:
• define high grade weathered bastnaesite rare earth mineralisation in the SREZ sufficiently for the ‘Measured’ Mineral
Resource JORC category through infill drilling.
• quantify the amount of highly weathered, low carbonate, low phosphate bastnaesite rare earth mineralisation in the central
SREZ that is amenable to mineral processing by the sulphuric acid route.
• provide diamond core and RC samples for further beneficiation and detailed hydrometallurgical test work
• increase the current rare earth Mineral Resource through potential extensions to the SREZ mineralisation
Additional exploration drilling was initially planned for 2012 to investigate the Northern Zone (Figure 2), where extensive areas of
niobium – tantalum, phosphate and rare earth mineralisation was identified by two wide spaced reconnaissance drill traverses
completed in 2011. This drilling has been postponed to the 2013 field season to allow for the identification of a suitable
beneficiation and metallurgical processing route for this second style of mineralisation at Ngualla. It also allows the Company
to direct funds and resources towards the rapid development of the SREZ.
At the end of the September Quarter, a total of 95 holes for 9,750m metres of RC drilling and 4 diamond drill holes for 680m
had been completed. The program is on track for completion in November, prior to the onset of the rains.
Ngualla Rare Earth Project Development Schedule
Mile
ston
esRE
Exp
lora
tion
&
Reso
urce
Dril
ling
Pote
ntia
l Pat
hway
to
RE
Prod
uctio
n
EXPLORER MINERDEVELOPER
2010 2011 2012 2013 2014
Commenced Metallurgical Characterisation Discovery Supply Agreements Zari JV Aquisition
Maiden Resource Statement Production Start up Metallurgical Flow Sheet Development
Pilot Plant Trials commencing
Completion of acid leach test work Completion of separation test work
Exploration Drilling
Resource Definition & Extension
Scoping Study
Pre-Feasibility Study
Definitive Feasibility Study
Maiden Resource Drilling
Geotech - Extension
2015 2016
Commence Construction
8
Quarterly Report September 2012
Assay results received from infill drilling within the SREZ during the September Quarter define the highest grade intersections
returned from the project to date including:
DRiLLhOLE iNtERSECtiON
NRC168: 151m at 5.15%REO from surface to end of hole
NRC176: 140m at 5.21%REO from surface to end of hole
NRC180: 102m at 5.51%REO from surface to end of hole
NRC183: 127m at5.15%REO from surface to end of hole
NRC195: 160m at5.25%REO from surface to end of hole
NRC220: 95m at 5.44%REO from surface and
15mat5.98%REO from 98m to end of hole
*REO = Total Rare Earth Oxide. See Table 3 for drill intersection details and Table 2 for individual rare earth distribution.
Drill hole NRC220 ended in weathered mineralisation grading 8.02% REO at 113m. High grade mineralisation in the above
drill holes extends from surface within highly weathered carbonatite composed predominantly of barite and iron oxide, original
carbonate minerals having been removed during the weathering process.
9147
500
mN
9148
000
mN
9148
500
mN
482500 mE482000 mE
750m
! !
!
! ! !
! !
!
! !
!
! ! ! !
! ! ! !
!
!!
!
!
!
! !
!
!
!
!! ! ! ! !! ! !!
! ! ! !
!
!!
!
! ! ! !
!
!
!
!
!
!!
!
!
!
!
! ! !
!
!!
!
!
!
!
!
!
!
!!
!
!
!
!
!
!
! !
!
!
!
!
!
!
!
!
!!
!
!
!
!
!
! !
!
!
!
!
!
!
!!
!
! !
!
!
!
!!
! !
! !
!!
!!
! !! !!
!!
! ! ! ! !
!!!! !!!
!!!!
! ! ! ! !
!!
!!
Ö
Ö
Ö
Ö
Ö
Ö
Ö Ö Ö Ö ÖÖ
Ö
ÖÖ Ö Ö
ÖÖÖÖÖÖ
Ö Ö ÖÖ ÖÖ Ö ÖÖ
Ö
Ö
Ö
ÖÖ
Ö ! !! !
! ! !
!!
! !!
!
!
! ! !
!
!
!
! !
!
!
!
!!
! !
!
!
!
!
!
!!!
!
!! !! !
!
!
!
!
!
!
!
! ! !
!
!
!
!
!
! ! !!
!
Southern Rare Earth Zone
South West Alluvial Zone
OPEN
OPEN
OPENOPEN
250m0 100
NDrill holes max REO %:
! 0 to 1
! 1 to 2
! 2 to 3
! 3 to 5
! >5
2012 Drill Program
Ö Completed hole, results awaited
Block Model REO%: A 3 to 4%A > 4%
Bastnaesite rare earth zone
Bastnaesite rare earth zone
NRC205NRC204
NRC176
NRC183
NRC180
NRC195
NRC214
NRC168
NRC220NRC209
102m @ 5.51% from surface to EOH
95m @ 5.44% from surface, and
15m @ 5.98% from 98m to EOH
160m @ 5.25% from surface to EOH
151m @ 5.15% from surface to EOH
127m @ 5.15% from surface to EOH
140m @ 5.21% from surface to EOH
SOUTHERN RARE EARTH ZONEOCT 2012
Figure 7: Plan of rare earth intersection highlights September Quarter 2012 and drilling completed to 15th October 2012, coloured by maximum down hole REO% over Ngualla Mineral Resource block model (+3% REO). Intersection highlights for all new holes labelled with an ID are shown in Table 3.
9
Quarterly Report September 2012
Included within the +1% REO intersections (page 8) are several discrete higher grade zones of significant width:
DRiLLhOLE iNtERSECtiON
NRC195: 24mat 7.15%REO from 76m and
20m at 7.27% REO from 108m
NRC204: 12mat7.13%REO rom 4m
NRC205: 18m at 7.21%REO from 8m
NRC209: 30m at 7.14%REO from 48m
NRC220: 42mat7.86%REO from 48m
Higher grade intervals using a 4% REO lower grade cut and maximum of 2m internal dilution. Intersection details and grades at 1% REO lower grade cut-off are included in Table 3.
The new results also identify the deepest developed weathered zone of high grade mineralisation to date, with mineralisation
remaining open at a depth of 160m below surface:
NRC214: 66mat3.06%REO from surface and
36mat 3.87%REO from 72m and
73m at 4.51%REO from 112m to end of hole
These wide, high grade intersections confirm the continuity and consistency of the rare earth mineralisation from surface in the
heart of the deposit targeted for first development and production. Mineralisation still remains open at depth and to the south.
The Company will continue to provide regular updates regarding the progress of the SREZ drilling and assay results as they
are received. An updated Mineral Resource estimate will be completed according to the JORC Code and Guidelines by the
end of the first quarter 2013.
Mt Mapuma Soil SamplingThe Mt Mapuma area is located within the Ngualla carbonatite two kilometres to the north west of the Southern Rare Earth Zone
(Figure 2). Previous sparse reconnaissance soil and rock sampling in this area has identified rare earth mineralisation up to
3.39% REO in ankeritic carbonatite, the rock type that hosts mineralisation in the Southern Rare Earth Zone.
A detailed soil sampling program over a 1.4km x 900m area was completed over the Mount Mapuma area in June 2012. A
coherent high tenor rare earth anomaly extending over an area of 550m x 500m at +2% REO was defined by the soil sampling
with soil samples containing up to 6.27% REO.
Follow up rock sampling confirmed rare earth mineralisation in outcropping ankeritic carbonatite within a 330m x 90m area with
highest assay results of 3.43% REO. Further rock sampling is planned to define the extent of the bedrock target area prior to
initial drill testing.
Community ResponsibilityPeak Resources is committed to improving the communities in which it operates whilst
maintaining best practice environmental management. Through provisions of employment
opportunities, training, purchase of local products and funding for local building and
education projects, win-win relationships are being forged with the local community.
Peak Resources has funded the building of two new classrooms and made improvements
to 4 existing classrooms at the local Ngualla Primary School. New floors and desks have
been installed and the classrooms repainted. In addition, the company has assisted with
maintenance of the Ngualla village water system, the new village airstrip and access road.
Projects during the current year include the building of two teacher’s houses in Ngualla
village, and the provision of school books for three primary schools in the region.
Above: Project Manager Patrick Ochieng and Logistics Manager Ismail Hassan handing over school books outside the new classrooms built by Peak at the Ngualla Primary School, August 2012.
10
Quarterly Report September 2012
CORPORATE
Equity Issues
On 27 July 2012 the company announced that it was undertaking a placement of 32.3 million shares at $0.17 to sophisticated
investors and clients of Shaw Corporate Finance Pty Ltd and Blue Ocean Equities Pty Ltd raising $5.5 million before costs.
Subscribers to the placement were issued to 1 free option for every share allotted.
The placement was completed in two tranches. Tranche 1 was completed on 6 August 2012 and 15,529 822 shares and
15,529,822 options have been allotted to raise $2.64 million before costs. The shares were issued under the Peak’s 15%
capacity rule Tranche 2 of 16,823,120 million shares and 16,823,120 million options was issued following shareholder approval
at a General Meeting of the company on 10 September 2012 to raise approximately $2.86 million. Tranche 1 was ratified at this
same meeting.
The company also offered to existing shareholders an opportunity to participate in a Share Purchase Plan (SPP) where
shareholders were able to subscribe up to $15,000 worth of shares at 17 cents with a free attaching listed option to raise $2
million before costs. The SPP was approved by shareholders at the General Meeting. Applications were received from a total
of 279 shareholders for a total of 15,306,309 shares to raise a total of $2.6 million. Given the high level of support for the SPP,
the Company decided to increase the Plan to cater for all applications rather than scale back applications.
The options (ASX:PEKO) are listed and are exercisable at $0.25 on or before 31 July 2014.
Corporate Structure and Cash on Hand
The current corporate structure as at the 30th September 2012 was:
ASX: PEK
OTCQX: PKRLY
Ordinary Shares on Issue: 254.7 million
Cash at hand: $8.35 million
52 week range: $0.15 - $0.62*
Market Cap: $40.8 million (at $0.16)
Listed Options outstanding: 47.7 million
Unlisted Options outstanding: 11.2 million
Liquidity: 0.5 million shares per day (av. over 3 mths**)
* From 01-Oct-11 to 30-Sep-12
** Average from 01-Jul-12 to 30-Sep-12
Richard Beazley Managing Director
The information in this report that relates to Exploration Results is based on information compiled and/or reviewed by Dave Hammond who is a Member of The Australasian Institute of Mining and Metallurgy. Dave Hammond is the Technical Director of the Company. He has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Dave Hammond consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
The information in this report that relates to Mineral Resources is based on information compiled by Rob Spiers, who is a member of The Australasian Institute of Geoscientists. Rob Spiers is an employee of geological consultants Hellman and Schofield Pty Ltd. Rob Spiers has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Rob Spiers consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
11
Quarterly Report September 2012
Appendix:
Table 1: Classification of Mineral Resources for the Ngualla Rare Earth Project, 1.0% and 3.0% REO cut-off grades.
Lower cut – off grade
Resource Category
Tonnage (Mt)
REO (%)*
Contained REO tonnes
1.0%REO
Measured 29 2.61 750,000
Indicated 69 2.43 1,700,000
Inferred 72 1.92 1,400,000
tOtAL 170 2.24 3,800,000
3.0%REO
Measured 11 3.99 430,000
Indicated 21 4.09 850,000
Inferred 8.7 4.11 360,000
tOtAL 40 4.07 1,600,000
*REO (%) includes all the lanthanide elements plus yttrium oxides. Figures above may not sum precisely due to rounding. The number of significant figures does not imply an added level of precision.
Table 2: Relative components of individual REO’s (including yttrium) as a percentage of total REO at Ngualla SREZ (> 1% REO) compared to other large rare earth deposits.
RAREEARthSCONtENt(%OftOtALREO)
NGUALLA SREZ*
%NOLANS BORE
%MOUNTAIN PASS
%BAIYUNEBO (CHINA) %
MT WELD CLD %
Ligh
t RE
Lanthanum 27.5 19.1 33.2 27.1 23.9
Cerium 48.3 48.7 49.1 49.9 47.6
Praseodymium 4.72 5.93 4.34 5.15 5.16
• Neodymium 16.1 20.5 12.0 15.4 18.1
Samarium 1.59 2.30 0.80 1.15 2.44
• Europium 0.32 0.39 0.12 0.19 0.53
Hea
vy R
E
Gadolinium 0.73 0.99 0.17 0.40 1.09
• Terbium 0.06 0.08 - - 0.09
• Dysprosium 0.14 0.32 - 0.30 0.25
Other 0.10 0.21 0.16 0.03 0.12
Other • Yttrium 0.40 1.35 0.10 0.20 0.76
total% 100 100 100 100 100
Source: Arafura Website and *= Ngualla SREZ Mineral Resource >1% REO.
The blue markers denote the five “Critical Rare Earths”, which are predicted to be in undersupply in the years ahead and therefore to
command significantly higher value than other rare earths. (US DoE, ‘Critical Materials Strategy’ report, December 2011).
The critical rare earths contribute the majority of the value from Ngualla at 56% of the total in-ground value. Of these, neodymium
is the main single driver, contributing 34%, (relative rare earth oxide prices: Metal Pages, 11th September 2012).
12
Quarterly Report September 2012
Table 3: Drill hole and intersection details for intersection highlights September Quarter 2012, Southern Rare Earth Zone – rare earth RC drill intersections +1 % REO
Selected intersections + 2% REO in italics
Hole ID East North Hole Depth (m) From (m) To (m) Interval (m) REO %
NRC168 482,278 9,147,995 151 0 151 151* 5.15NRC176 482,200 9,147,947 140 0 140 140* 5.21NRC180 482,240 9,147,961 102 0 102 102* 5.51NRC183 482,359 9,148,053 127 0 127 127* 5.15NRC195# 482,253 9,147,957 160 0 160 160* 5.25NRC204 482,403 9,147,852 120 0 52 52 4.84
62 70 8 1.2874 88 14 1.04
NRC205 482,438 9,147,851 120 0 100 100 3.56(incl. 0 54 54 5.36)
108 118 10 1.47NRC209 482,078 9,147,700 120 0 112 112 4.78
(incl. 0 88 88 5.52)NRC214 482,201 9,147,741 185 0 66 66 3.06
72 108 36 3.87112 185 73* 4.51
NRC220 482,122 9,147,691 113 0 95 95 5.4498 113 15* 5.98
Note: REO = total rare earth oxides including yttrium. See Table 2 for relative distribution of individual rare earth oxides. Samples are 2m composites from angled -60° west RC drilling except for #NRC195 – which is drilled to north. Intersections calculated using 1% REO lower cut and a maximum of 2m internal dilution. Analysis by SGS laboratory, Perth, by 4 acid digest and ICP or XRF. Co-ordinate system is Arc 1960 UTM zone 36S. * = hole ended in mineralisation.
13
Quarterly Report September 2012
Appendix 5B Mining exploration entity quarterly report
+ See chapter 19 for defined terms.
30/9/2001 Appendix 5B Page 1
Rule 5.3
Appendix 5BMining exploration entity quarterly report
Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001, 01/06/10.
Name of entity Peak Resources Limited
ABN Quarter ended (“current quarter”) 72 112 546 700 September 2012
Consolidated statement of cash flows
Cash flows related to operating activities Current quarter
$A’000Year to date (3 months)
$A’000
1.1 Receipts from product sales and related debtors
1.2 Payments for (a) exploration & evaluation (b) development (c) production (d) administration
(1,952)
(1,104)
(1,952)
(1,104)1.3 Dividends received 1.4 Interest and other items of a similar nature
received 42 42
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(3,014) (3,014)
Cash flows related to investing activities 1.8 Payment for purchases of: (a) prospects
(b) equity investments (c) other fixed assets (4) (4)
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(4) (4)
1.13 Total operating and investing cash flows (carried forward)
(3,018) (3,018)
14
Quarterly Report September 2012
Appendix 5B Mining exploration entity quarterly report
+ See chapter 19 for defined terms.
Appendix 5B Page 2 30/9/2001
1.13 Total operating and investing cash flows (brought forward)
(3,018) (3,018)
Cash flows related to financing activities1.14 Proceeds from issues of shares, options,
etc. 8,102 8,102
1.15 Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other (provide details if material) (280) (280)
Net financing cash flows 7,822 7,822
Net increase (decrease) in cash held 4,804 4,804
1.20 Cash at beginning of quarter/year to date 3,545 3,5451.21 Exchange rate adjustments to item 1.20
1.22 Cash at end of quarter 8,349 8,349
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 1.2 180
1.24 Aggregate amount of loans to the parties included in item 1.10
1.25 Explanation necessary for an understanding of the transactions
1.23 includes gross salaries including superannuation and fees to directors and legal fees paid to Steinepreis Paganin Lawyers & Consultants, an entity related to Jonathan Murray
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
15
Quarterly Report September 2012
Appendix 5B Mining exploration entity quarterly report
+ See chapter 19 for defined terms.
30/9/2001 Appendix 5B Page 3
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 $A’000
Amount used $A’000
3.1 Loan facilities
3.2 Credit standby arrangements
Estimated cash outflows for next quarter $A’000 4.1 Exploration and evaluation 1,685
4.2 Development 465
4.3 Production
4.4 Administration 767
Total2,917
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 5,695 1,091
5.2 Deposits at call 2,654 2,454
5.3 Bank overdraft
5.4 Other (provide details)
Total: cash at end of quarter (item 1.22) 8,349 3,545
16
Quarterly Report September 2012
Appendix 5B Mining exploration entity quarterly report
+ See chapter 19 for defined terms.
Appendix 5B Page 4 30/9/2001
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
17
Quarterly Report September 2012
Appendix 5B Mining exploration entity quarterly report
+ See chapter 19 for defined terms.
30/9/2001 Appendix 5B Page 5
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 per security (see note 3) (cents)
Amount paid up per security (see note 3) (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
254,723,553 254,723,553 Fully Paid
7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy-backs
47,659,251 47,659,251 $0.17 Fully Paid
7.5 +Convertible debt securities (description)
7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted
7.7 Options (description and conversion factor)
500,000500,000
1,000,000750,000750,000750,000
6,250,000541,667150,000
47,659,251
- - - - - - - - -
47,659,251
Exercise price $0.60 $1.00 $1.50 $0.60 $0.90 $1.20 $0.55 $0.75 $0.55 $0.25
Expiry date 16 May 2013 26 May 2013 26 May 2014 16 May 2015 16 May 2015 16 May 2015
20 February 2017 24 February 2014
3 March 2018 31 July 2014
7.8 Issued during quarter
47,659,251 47,659,251 $0.25 31 July 2014
7.9 Exercised during quarter
18
Quarterly Report September 2012
Appendix 5B Mining exploration entity quarterly report
+ See chapter 19 for defined terms.
Appendix 5B Page 6 30/9/2001
7.10 Expired 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 5).
2 This statement does give a true and fair view of the matters disclosed.
Sign here: Date: 25 October 2012
(CFO/Company Secretary)
Print name: Farlee Walker
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.
== == == == ==