Page 48 - Sundance Resources Ltd Annual Report 2013

46 SUNDANCE RESOURCES LIMITED ANNUAL REPORT 2013
directors’ report (continued)
FOR THE YEAR ENDED 30 JUNE 2013
5. REVIEW OF OPERATIONS
Operations
The Consolidated Entity holds a majority interest in subsidiaries Cam Iron SA (‘Cam Iron’) and Congo Iron SA
(‘Congo Iron’) whose principal asset is the Mbalam-Nabeba Iron Ore Project (‘the Project’), which straddles the
border of Cameroon and Congo in Central Africa. It is comprised of Exploration Permit 92 (‘EP92’) held by Cam Iron
located in the East Province of Cameroon and Mining Permits Nabeba-Bamegod (‘Nabeba’) and Exploration Permit
Ibanga (‘Ibanga’) in the Sangha Province of Congo held by Congo Iron.
The Project will see: the development of mines at both deposits in Cameroon and Congo; the construction of a 510
kilometre rail line dedicated to the transport of iron ore through Cameroon; construction of a 70 kilometre rail spur
line connecting the Nabeba mine in Congo; and, the building of a dedicated deep water port terminal at Lolabe
in Cameroon, designed to be capable of taking bulk iron ore carriers of up to 300,000 DWT. This will support the
production of 35Mtpa of high grade hematite (averaging 62.6% Fe) for the first 10 to 12 years and then
35Mtpa of a high quality concentrate (averaging 66- 68% Fe) for at least a further 15 years.
Key highlights for the Project during the financial year included:
• The Mbalam Convention (‘the Convention’) with the Cameroon Government was signed on 29 November 2012.
The Convention underpins the agreement between Sundance subsidiary Cam Iron SA and the Government
outlining the fiscal and legal terms and the conditions to be satisfied by Cam Iron SA for the development and
management of the Mbalam Iron Ore Project in the Republic of Cameroon. The Convention with a number
of other conditions including endorsement by the Cameroon National Assembly will lead to the issuance of a
Mining Permit and the right to commence construction of the Project in Cameroon.
• The Congo Government approved the issuing of the Congo Mining Permit in December 2012 and it was
granted to Congo Iron SA by Presidential Decree in February 2013 with the issue of official Mines Department
decree number 2013-45 covering the Nabeba deposit. The adjoining Ibanga Exploration Permit was also
renewed for a further two years of exploration research work in August 2013 as official decree number 2013-
405. This approval, coupled with the signed Convention in Cameroon, paves the way for work to commence
on a world-class iron ore operation in Central Africa once financing is in place.
• High Grade Mineral Ore Reserves increased to 436.3 million tonnes (Mt) at 62.6% Fe1 – underpinning 12 years
of Direct Shipping Ore (‘DSO’) production for stage one of the project. The Ore Reserve increase is from within
the current inventory of 775.4Mt of High-Grade Hematite Resources at 57.2% Fe2 representing a conversion
of 58% of the Company’s total Indicated Mineral Resources (748.0Mt)3.
• Itabirite hematite resources were increased from 2.3Bt to 4Bt at an average grade of 36.3%. An exploration
target4 of an additional 9.3 to 13.2Bt at 30 – 40% Fe was also declared.
• A renewed project development strategy was approved by the Sundance Resources Limited Board of Directors
(‘the Board’) in April 2013. Implementation of this strategy has commenced with tender documents issued for
2. COMPANY SECRETARY
Brian Conrick joined Sundance as General Counsel on 1 July 2010 and was appointed Company Secretary on
21 December 2011. Mr Conrick has a Master of Laws (UQ) and is a solicitor of the High Court of Australia and
several Australian jurisdictions.
3. PRINCIPAL ACTIVITIES
The principal activities of the Consolidated Entity during the year were iron ore exploration, the continued evaluation
and de-risking of its Mbalam-Nabeba Iron Ore Project (‘the Project’) in the Republic of Cameroon (‘Cameroon’)
and the Republic of Congo (‘Congo’), and the evaluation of various development scenarios for the Project.
There were no significant changes in the nature of the principal activities during the financial year.
4. RESULTS
The operating loss after tax of the Consolidated Entity for the financial year was $31,641,559 (2012: $25,308,131).
1 Full details of these reserves have been released via ASX announcement and media release dated 24 Dec 2012.
2 Full details of these resources have been released via the September Quarterly Report ASX announcement dated 26 Oct 2012.
3 Full details of these resources have been released via ASX announcement dated 20 June 2012.
4 It must be noted that this range is an Exploration Target only, and not to be misconstrued as an estimate of Mineral Resources. The potential quantity and grade is
conceptual in nature. There has been insufficient exploration to define a mineral resource and it is uncertain whether further exploration will result in the determination
of a mineral resource.