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STELLAR RESOURCES LIMITED Interim / Quarterly Report 2021
65860_rns_2021-04-20_553f51b6-632e-46cd-9bb6-ee8be1d4edac.pdf
Interim / Quarterly Report
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Report for the Quarter ended 31 March 2021
Highlights
Heemskirk Tin Project
- Tin prices have soared this year reaching 10-year high's (~US$ 28,000/t average LME tin spot price for the 2 months to 14 April 2021) as demand growth exceeds falling supply and stocks reaching near record lows.
- Tin is rated as the No. 1 new technology metal and is expected to continue to perform strongly.
- With the highest grade undeveloped tin resource in Australia & 2nd highest globally and a scoping study completed in 2019 confirming attractive economics, the Heemskirk Tin Project is well positioned to take advantage of this year's booming tin market.
- In February, the Company announced it would commence a Phase 1 tin exploration drilling program and in March that the program would be expanded.
- The Phase 1 drilling program, about to commence, will target new areas of high-grade tin mineralisation including:
- 7 holes targeting depth extensions below key historic silver-lead mines with typical ore grades of 20 to 100 Oz/t silver. These holes target depths below the historically mined silver-lead lodes where transition to tin mineralisation is expected although there is also potential to intersect deeper highgrade silver-lead-zinc lodes.
- 2 holes targeting depth extensions ~100m below the Severn tin resource limit at a depth of ~600m from surface. It is hoped that mineralisation will continue and increase in grade towards the underlying granite contact.
- A Phase 2 drilling program is now under review including:
- Indicated resource infill drilling program over key Heemskirk Tin Project deposits.
- A deep hole targeting the main conduit of mineralising fluids at Heemskirk.
- Other project work streams / studies required to advance the Heemskirk Tin Project to PFS and BFS completion are also now under review.
North East Tasmania Gold Exploration Project
- NE Tasmania is a continuation of the Victorian Western Lachlan Fold Belt, which hosts the Fosterville Mine and other Tier 1 goldfields and has produced >80 MOz gold.
- NE Tasmania hosts the Beaconsfield Mine (2.3 MOz), Mathinna and Lefroy Goldfields and hundreds of smaller gold mines and occurrences.
- While Victoria is currently experiencing intense gold exploration activity, NE Tasmania has had very little modern gold exploration.
- Stellar holds 12 first in time Exploration Licence (EL) applications covering a large area of 2,534 km2 in NE Tasmania:
- 10 EL applications (2,295 km2 ) submitted in September 2020. EL's expected to be granted ~June 2021.
- 2 EL applications (240 km2 ) submitted in March 2021. EL's expected to be granted later in 2021.
- Stellar's ELAs are highly prospective for Victorian-style orogenic gold and Intrusion Related Gold Systems (IRGS) and has ~77 historic gold and ~25 tin occurrences recorded.
- During the quarter, a number of desktop orogenic and IRGS gold exploration targets have been identified by Stellar's technical team on its ELAs using a full GIS capability for targeting including; recently reprocessed aeromagnetic, radiometric and gravity data, geology, recorded gold and tin occurrences, historic drilling and geochemical data.
- On-ground exploration planned to commence following grant of EL's and will focus initially on soil and rockchip sampling and geochemistry to identify drill targets for the following year.
- A review of tin exploration potential within Stellar's NE Tasmanian ELA package is now also underway.
Corporate
- On 17 March, the Company announced that it had received firm commitments to raise $3.6m (before costs) by way of a placement of 163,636,364 fully paid ordinary shares at $0.022 (2.2 cents) per share. The first tranche of $2.0m was completed on 24 March with all funds received and 90,909,090 shares issued. Firm commitments have been received for the second tranche of $1.6m (72,727,274 shares to be issued) which is subject to shareholder approval at a General Meeting of shareholders to be held on 4th May 2021.
- On 19 March, 7,200,000 unlisted options were exercised into shares at $0.015 (1.5 cents) per option raising $108,000.
- Cash balance of $4.0m at 31 March 2021 (not including the $1.6M (before costs) expected from Tranche 2 of the Placement which is subject to shareholder approval on 4th May 2021). This places the Company in a strong financial position to advance it's projects.
Heemskirk Tin Project
Tin Market Outlook
Tin prices have soared since the start of this year reaching 10-year high's not seen since the 2011 boom. The LME spot tin price has averaged ~US$28,000/t for the 2 months to 14 April 2021.
This is due to strong physical global tin demand growth which has exceed falling global tin supply and is creating an extremely tight market for tin with LME tin stocks reaching near record lows.
LME Spot Tin Prices (1 Jan 2010 to 14 April 2021) 1
Tin Demand
Physical tin demand is growing strongly as a result of:
- Covid and the rise of remote working has boosted demand for computers and other home electronics devices. As tin solder is the 'glue' connecting everything electronic, this means increased demand for tin.
- Continued demand for tin in traditional uses including tinplate, chemicals, lead-acid batteries, alloys and other uses.
Tin Supply
Global tin supply has fallen for each of the last 3 years. Falling global tin supply has been the result of:
- China is the world's largest miner of tin and smelter of tin metal and has also been a net tin importer this year. Production cuts have occurred in many Chinese tin smelters this year due to tin ore shortages. China is stockpiling tin to meet its goal of self-sufficiency in semiconductors.
- Indonesia (world's 2nd largest producer) production has fallen this year due to a poor monsoon season along with ongoing environmental controls and covid issues.
- Myanmar (world's 3rd largest producer) production has fallen this year due to the military coup and largely unreliable artisanal and small-scale mining.
- South America (world's 4th largest producer) supply has been reduced this year due to Covid issues.
- Many existing tin mines now have lower grade and diminishing resources. There has been limited exploration or investment in new tin projects and many are either in risky jurisdictions or are low grade deposits.
Tin – The Number 1 New Technology Metal
Tin ranked as the No. 1 metal best placed to benefit from new technology according to a survey undertaken by Boston's Massachusetts Institute of Technology (MIT) for Rio Tinto in 2018.
~50% of all tin is used as solder in electronics. Solder is the 'glue' that connects everything electronic together.
Our clean, new technology future is being driven by robotics, advanced computing, EV's, energy storage and renewables – these all require more electronics and semiconductors which all need more tin.
Growing research is also showing that tin may be a more effective anode material in Li-ion batteries.
With the highest grade undeveloped tin resource in Australia & 2nd highest globally and a scoping study completed in 2019 confirming attractive economics, the Heemskirk Tin Project is well positioned to take advantage of this year's booming tin market which is expected to continue to perform strongly.
Overview of Stellar's Tin Projects
Stellar's 100% owned tin projects have an enviable location within the well-established mining district on the West Coast of Tasmania with access to established infrastructure including nearby water and renewable power, access to the port of Burnie 150km to the north via sealed highway for export of concentrate, and a competitive local market for services, mining and processing inputs and labour.
Stellar's flagship Heemskirk Tin Project is just 18km to the southwest of the Renison tin mine, the largest and most productive tin mine in Australia. Including Renison, there are 5 major underground metal mines, 3 of which are operating, within 30km of the Heemskirk Tin Project.
Location of Stellar's Tin Projects – West Coast of Tasmania
The Heemskirk Tin Project includes 4 nearby tin deposits; Severn, Queen Hill, Montana and Oonah. Stellar holds secure Mining Leases over the Heemskirk Tin Project including the tailings pipeline route and tailings storage site and also over the St Dizier satellite tin deposit.
In addition to the Heemskirk Tin Project, Stellar owns a portfolio of nearby Exploration Licences including the Montana Flats and Mount Razorback EL's which contain a number of historic silver-lead-zinc mines with associated tin mineralization, and the St Dizier and Mount Razorback satellite tin deposits.
Heemskirk Tin Project Deposits (blow up), Secure Mining Leases and a Large EL Package
Tin Resources
The Heemskirk Tin Project has a Total Mineral Resource of 6.6 Mt @ 1.1% Sn at a 0.6% Sn cut-off grade, of which 2.12 Mt is in the Indicated Mineral Resource Category and 4.48Mt is in the Inferred Mineral Resource Category 2 . All deposits have higher grade zones and are amenable to mining at higher cut-off grades. All deposits open at depth.
| Classification | Deposit | Tonnes(mt) | Sn(%) | ContainedSn (t) | Cassiterite% of TotalSn (%) | Cu(%) | Pb(%) | Zn(%) |
|---|---|---|---|---|---|---|---|---|
| Indicated | Upper Queen Hill | 0.32 | 1.0 | 3,230 | 87 | 0.2 | 2.1 | 1.0 |
| Lower Queen Hill | 0.65 | 1.4 | 9,230 | 97 | 0.0 | 0.1 | 0.1 | |
| Severn | 1.15 | 1.0 | 11,500 | 99 | 0.1 | 0.0 | 0.1 | |
| Total Indicated | 2.12 | 1.1 | 23,960 | 97 | 0.1 | 0.4 | 0.2 | |
| Inferred | Upper Queen Hill | 0.11 | 1.6 | 1,760 | 94 | 0.2 | 1.9 | 0.7 |
| Lower Queen Hill | 0.36 | 1.4 | 5,040 | 97 | 0.0 | 0.2 | 0.0 | |
| Severn | 2.74 | 0.9 | 24,660 | 99 | 0.0 | 0.0 | 0.0 | |
| Montana | 0.68 | 1.5 | 10,200 | 96 | 0.1 | 0.7 | 1.4 | |
| Oonah | 0.59 | 0.9 | 5,310 | 36 | 0.8 | 0.1 | 0.1 | |
| Total Inferred | 4.48 | 1.0 | 46,970 | 90 | 0.1 | 0.2 | 0.3 | |
| Total Indicated + Inferred | 6.60 | 1.1 | 70,930 | 92 | 0.1 | 0.3 | 0.3 |
In addition, the St Dizier Tin deposit has a Total Mineral Resource of 2.26Mt @ 0.61% Sn of which 1.20 Mt in the Indicated Mineral Resource Category and 1.06 Mt is in the Inferred Mineral Resource Category 6 .
Heemskirk is the highest grade undeveloped tin resource in Australia and the second highest grade tin resource globally 3 .
2021 Drilling Program – Phase 1
During the quarter, a Phase 1 drilling program (~9 diamond holes, ~4,900m) aimed at identifying new areas of high-grade tin mineralisation near the defined Heemskirk tin deposits / resources was announced 4,5. The Phase 1 Drilling Program is about to commence includes:
- Part A - 7 holes targeting depth extensions below key historic silver-lead mines
- Part B - 2 holes targeting depth extensions of the Severn tin resource
The Phase 1 program was put out to tender early in April and responses have recently been received from 4 Tasmanian based drilling companies which are now being evaluated by the Company. Drilling permits from Mineral Resources Tasmania are expected by end-April. The Company is targeting commencement of drilling in May.
$235,000 in Tasmanian Government Exploration Drilling Grant Initiative (EDGI) co-funding grants have been applied for over the Phase 1 holes.
Phase 1 Part A - Historic Silver-Lead Mines - Depth Extension Drilling 4,5
The highly mineralised Zeehan mineral field contains many historically significant high-grade silver-lead mines which have a total recorded production of 26 MOz Silver & 190,000 t Lead and resulted in the development of a major town and smelters at Zeehan in the late 1800's / early 1900's.
Part A of the Phase 1 drilling program includes 7 planned holes (total of ~3,000m) aimed at identifying new areas of high-grade tin mineralisation below 4 of the largest historic silver-lead mines in the Zeehan mineral field (Montana No.1, Zeehan Western, Oonah & Zeehan Queen No. 4) which are located on Stellar's licences and typically had:
- Ore grades of 20 Oz/t Silver to 100 Oz/t Silver
- Mining widths of a few cm up to 2.7m (fissure veins)
- Mining lengths up to 300m
- Mining depths of 70m to 300m
Silver-Lead lodes typically transition into tin (with pyrite) lodes at depth. The 7 Phase 1 Part A holes target depths below the historically mined silver-lead lodes where transition to tin mineralisation is expected although there is also potential to intersect deeper high-grade silver-lead-zinc fissure lodes. No drilling ever done below these mines.
Tin mineralisation in the Zeehan district is generally associated with pyrite. Both the Queen Hill and Montana Deposits were recorded as "pyrite" lodes by the early silver-lead miners and considered worthless. Cassiterite (tin) mineralisation which was often fine grained was generally not recognised or assayed for by the early silver-lead miners. The Queen Hill tin deposit was discovered by Gippsland Minerals by sampling and then drilling of supposedly barren pyrite lodes exposed in the Zeehan Queen No. 4 silver-lead mine workings. Based on this Pyrite Lode model, Gippsland Minerals then drilled a reported pyrite lode associated with the silverlead lodes in the Montana No. 2 Mine thus discovering the Montana tin deposit. Pyritic lodes have also been recorded in the Oonah and Montana No. 1 historic silver-lead mines. These pyritic lodes are targets for tin mineralisation.
Zeehan Mineral Field - Sn Deposits & Historic Ag-Pb-Zn Mines on simplified Geology
Phase 1 Part B - Severn Resource Depth Extension Drilling 5
Part B of the Phase 1 drilling program includes two ~700m holes with provision for wedging & daughter holes planned (total of ~1,900m) targeting depth extensions of the Severn tin resource.
Severn is the largest of the Heemskirk Tin Project deposits and has been drilled only to ~500m depth. The 2 holes planned target extension of the Severn deposit ~100m below the current resource limit at a depth of ~600m. Severn remains open at depth where it is hoped that mineralisation will continue and increase in grade towards the underlying granite contact, predicted to be >1,000m below the surface from geophysical surveys.
| Target | No.Holes | Approx.HoleLength(m) | HistoricSilverProduction(MOz) | Description |
|---|---|---|---|---|
| Oonah Mine | 2 | 400 | 2.0 | Large historic Ag-Pb mine, worked to 120m withInferred resource based on historic drilling below(0.59 Mt at 0.9% Sn, 0,8% Cu, 0.1% Pb, 0.1% Zn).Remains open at depth |
| Montana No. 1Mine | 2 | 500-600 | 7.1 | The largest Ag-Pb mine in Zeehan Field. Worked to200m depth on 6 lodes |
| ZeehanWestern Mine | 2 | 400 | 4.8 | One of largest Ag-Pb mines in Zeehan Field.Worked to 300m depth |
| ZeehanQueenNo. 4 Mine | 1 | 300 | 2.0 | Large historic mine, worked to 70m where lodehad transitioned to pyrite and never assayed for tin |
| SevernResource | 2 | 700 | None | Targeting ~100m below currently defined Severntin resource at ~600m depth |
| Total | 9 | 4,900 |
Phase 1 Drilling Program Summary 5
Phase 2 Drilling Program
A Phase 2 diamond drilling program is currently under review by Stellar including:
Severn and Queen Hill Indicated Resource Infill Program
Severn and Queen Hill are the two largest Heemskirk Tin Project deposits with a combined total Mineral Resource of 5.33Mt @ 1.0% Sn, of which 40% is Indicated & 60% Inferred 2 .
The Phase 2 drilling program under review comprises Infill drilling to upgrade a significant part of the Severn and Queen Hill Inferred Resource to an Indicated Resource in order to support a PFS / BFS for the project.
1 Deep hole
A deep hole is being considered as part of a Phase 2 drilling program to target the main conduit of mineralising fluids into the Severn and Queen Hill deposits from the underlying interpreted granite.
Advancement of Heemskirk Tin Project to PFS/BFS Completion
Other project work streams and studies required to advance the Heemskirk Tin Project to PFS and BFS completion are also now under review by Stellar.
Many of the project work streams and studies have already been completed to a PFS level.
Work towards completion of the DPEMP is well progressed with environmental assessment program agreed and stage 1 surveys completed.
The project has secure Mining Leases granted over mine site, tailings pipeline route and tailings dam site.
Comparison with Renison Tin Mine
The Renison Tin Mine located 18km to the NE of Heemskirk has similar geology and ore genesis to the Heemskirk Tin deposits. Renison started with a 4.0Mt reserve and 5 year mine life in 1968 and has since increased the mine life to 50 years with at least another 15 years to go. The Heemskirk deposits contain only ~20% of contained tin found at Renison to date.
Comparison of Heemskirk and Renison Tin Deposits
Heemskirk Tin Project Scoping Study
In October 2019, Stellar announced the results of its Heemskirk Tin Project Scoping Study6 based on development of an underground mine, processing plant, tailings storage facility and surface infrastructure to mine ~ 350ktpa ore at a LOM head grade of ~ 0.95% tin from the Queen Hill and Severn tin deposits (2 of the 4 Heemskirk deposits) over a 10 year initial mine-life. The project also includes open-pit mining of the St Dizier satellite tin deposit and trucking of ore to the Heemskirk processing plant during year 11 of the mine plan.
The processing plant is expected to produce ~ 4,500 tpa of concentrate containing ~ 2,200tpa of tin. Concentrate produced will be trucked 150km to the north via sealed road to the Port of Burnie for export to smelters in Asia.
The scoping study mine plan contains 58% Indicated Resources and 42% Inferred Resources over the Life of Mine. The first 4 years are based on mining 100% Indicated Resource6 .
The 2019 Scoping Study confirmed the Heemskirk Tin Project has attractive economics:
- With a low pre-production capital base of A$57m, the Heemskirk Tin Project generates a pre-tax NPV10% of approximately A$83m (post-tax NPV10% of approximately A$71m), at a tin price of US$20,000/t and 0.70 USD:AUD exchange rate, to an accuracy of ±35%. The pre-tax internal rate of return of the project is approximately 45%.
- A competitive All-In Sustaining Cost of ~US$13,100/t of tin generates ~34% operating margin based on US$20,000/t tin price and 0.70 USD:AUD exchange rate.
| Total Ore Production (LOM) | (Mt) | 3.70 |
|---|---|---|
| Annual Ore Production (LOM Ave) | (Tonnes pa) | 354,000 |
| Sn Grade (LOM Ave) | (%) | 0.94 |
| Tin Recovery (LOM Ave) | (%) | 69.4 |
| Total Tin Production (LOM) | (Tonnes) | 24,000 |
| Annual Tin Production (LOM Ave) | (Tonnes pa) | 2,342 |
| Mine Life | (Yrs) | 11 |
| Tin Price (USD) | (US$/t) | 20,000 |
| Exchange rate | USD:AUD | 0.70 |
| Tin Price (AUD) | (A$/t) | 28,571 |
| Gross Revenue | (A$M) | 691 |
| Total Operating Costs (AISC) | (A$M) | 454 |
| Total Operating Costs (AISC) | (US$/t Tin) | 13,100 |
| Operating Cash Flow | (A$M) | 237 |
| Operating Margin | (%) | 34% |
| Capital Cost | (A$M) | 57 |
| Net Cash Flow (Pre-Tax) | (A$M) | 180 |
| Pre-Tax NPV10% | (A$M) | 83 |
| Post-Tax NPV10% | (A$M) | 71 |
| IRR (Pre-Tax) | (%) | 45 |
| Payback Period | (Yrs) | 3.0 |
| Pre-Tax NPV / Capex | 1.5 |
Heemskirk Tin Project – Key Results from 2019 Scoping Study 6
The Heemskirk Tin Project 2019 Scoping Study was undertaken for the purpose of ascertaining whether a business case can be made to proceed to more definitive studies on the viability of the Heemskirk Tin Project. It is a preliminary technical and economic study of potential project viability based on low level technical and economic assessments that are not sufficient to support the estimation of ore reserves. Further exploration and evaluation work and appropriate studies are required before Stellar will be in a position to estimate any ore reserves or to provide any assurance of an economic development case 6 .
North East Tasmania Gold Exploration Project
NE Tas – A Continuation of Victorian Western Lachlan Fold Belt 8
Gold deposits in North East Tasmania lie within a continuation of the Western Lachlan Fold Belt in Victoria – one of the world's largest orogenic gold provinces.
The Western Lachlan Fold Belt in Victoria hosts the >3 MOz Fosterville Mine, Bendigo and other Tier 1 goldfields and has produced >80 MOz gold.
NE Tasmania hosts the Beaconsfield Mine (2.3 MOz), New Golden Gate Mine (0.3 MOz) and Lefroy Goldfield (0.2MOz), along with hundreds of smaller historic gold mines and occurrences.
While Victoria is currently experiencing intense gold exploration activity, NE Tasmania has had very little modern gold exploration undertaken.
Continuation of Western Lachlan Fold Belt from Victoria into NE Tasmania 8
Gold deposits in NE Tasmania share the same geological setting as their Victorian counterparts:
- Ordovician turbiditic meta-sediments (Mathinna Super-Group).
- Ordovician to Devonian deformation and metamorphism (Western Lachlan Orogen).
- Associated with nearby Devonian granitoid intrusives.
- Gold commonly in quartz veins occupying dilational zones along large- scale faults related to folding and deformation during the Lachlan Orogen.
- Predominantly NW oriented lodes controlled by regional structures and rheological contrasts between sedimentary units.
- Intrusion Related Gold System (IRSG) deposits also occur in NE Tasmania.
Timing of Geological Events in NE Tasmania vs Melbourne and Bendigo Zone of Western Lachlan Fold Belt in Victoria (after Bierlein et al, 2005) 8
NE Tasmania Exploration Licence Applications 7
Stellar has 12 first-in-time Exploration Licence Applications (ELAs) covering an area of 2,534 km2 in NE Tasmania which is highly prospective for Victorian-style and IRGS gold exploration and contains ~77 recorded historic gold occurrences and 25 recorded historic tin occurrences:
- 10 first-in-time ELAs were registered in September 2020 covering an area of 2,295 km2 . These are expected to be granted by the end of June 2021.
- 2 first-in-time ELAs were registered in March 2021 covering an area of 240 km2 . These are expected to be granted later in 2021.
Figure 1 Stellar ELA's, NE Tasmania Geology and Mineral Occurrences
NE Tasmania Gold Exploration Targets 7,8
Numerous gold exploration targets have been identified within Stellar's ELA's areas based on the following targeting criteria:
- Ordovician turbiditic meta-sediments (Mathinna Super-Group)
- Ordovician to Devonian deformation and metamorphism (Western Lachlan Orogen)
- Devonian granitoid intrusives nearby
- Predominantly NW Regional scale structural trends/lineaments identified in aeromagnetic and gravity surveys and corresponding mapped faults. Intersecting NE trends/faults also identified in some of the ELA's
- Intrusive Related Gold Style (IRSG) targets identified from aeromagnetic surveys on some ELA's
- Location of recorded gold (and tin) occurrences
- Ground open for application
A number of desktop orogenic and IRGS gold exploration targets have already been identified using full GIS targeting capability developed by Stellar's technical team including; recently reprocessed aeromagnetic, radiometric and gravity data, geology, recorded gold and tin occurrences, historic drilling and geochemical data. A summary of the gold exploration targets within each of Stellar's 12 NE Tasmania ELA's is shown in the table below.
| Application Name | ApplicationNumber | OrdovicianMathinnaGroup | Regional Structures(MagneticLineaments &Mapped Faults) | GranitoidIntrusionsnearby | GoldOccurrences | TinOccurrences |
|---|---|---|---|---|---|---|
| Beaconsfield | ELA 10/2020 | Y | NW | Y | 18 | |
| Bridport Rd | ELA 11/2020 | Y | NW | Y | 3 | |
| Pipers River | ELA 12/2020 | Y | NW | Y | 15 | |
| Lilydale | ELA 13/2020 | Y | NW | Y | 6 | |
| Nunamara | ELA 14/2020 | Y | NW & NE | Y | 3 | |
| Camden Road | ELA 16/2020 | Y | NW & N | Y | 3 | |
| Scottsdale | ELA 15/2020 | Y | NW, N & NE & IRGS | Y | 2 | 21 |
| Mt Saddleback | ELA 17/2020 | Y | NW & NE | Y | 13 | 1 |
| Peppermint Hill | ELA 18/2020 | Y | NW | Y | 6 | |
| Scamander | ELA 19/2020 | Y | N & NE | Y | 7 | 1 |
| South Scamander& Pyengana | ELA 2/2021 | Y | NW, N,NE | Y | 1 | 2 |
| Quakers Ranges | ELA 3/2021 | Y | NW | Y |
Summary of Stellar NE Tasmania ELA Gold Targets
Proposed Exploration Program
A summary of the proposed work program for the North East Tasmania Gold Exploration Project is shown in the table below.
NE Tasmania Gold Exploration Project - Proposed Work Program Summary 3
| Year 1 | |
|---|---|
| Historic data capture - reprocessed aeromagnetic, radiometric and gravity data,geology, recorded gold and tin occurrences, historic drilling and geochemical datacaptured in GIS - largely completed | Desktop Phase(Prior to Grant of |
| Desktop target generation (orogenic lineaments/faults and IRGS targets) using fullGIS targeting capability developed by Stellar's technical team - well advanced witha number of targets defined) | EL's) |
| Fieldwork – soil and rock chip sampling and analysis over key targets. Other fieldreconnaissance activities. | |
| Generation of drill targets foy Year 2 (eg anomalous soil geochemistry results) | Ground BasedExploration Phase |
| Year 2 | (To commence on |
| First phase of drilling on drill targets identified in Yr 1. Combination of aircore or RABfor initial shallow drilling of targets, with follow up deeper reverse circulation anddiamond drilling planned | grant of EL's) |
Corporate
$3.6M Placement
On 17 March, the Company announced that it had received firm commitments to raise $3.6m (before costs) by way of a placement of 163,636,364 fully paid ordinary shares at $0.022 (2.2 cents) per share. The placement is being conducted in two tranches:
- Tranche 1 was completed on 24th March under the Company's available 15% capacity pursuant to ASX Listing Rule 7.1 raising $2.0m (before costs) from the issue of 90,909,090 fully paid ordinary shares at $0.022 (2.2 cents) per share.
- Tranche 2 Firm commitments have been received to raise a further $1.6m from the issue of 72,727,274 fully paid ordinary shares at $0.022 (2.2 cents) per share in tranche 2 of the placement which is subject to shareholder approval at a general shareholder meeting on 4th May 2021.
Exercise of Unlisted Options
On 19 March, 7,200,000 unlisted options were exercised into shares at $0.015 (1.5 cents) per option raising $108,000.
Following the exercise of these options, 29,800,000 unlisted options remain on issue, 27,800,000 of which have an exercise price of $0.015 (1.5 cents), with 2,000,000 director options with an exercise price of $0.020 (2.0 cents).
Tenements
| Description | TenementNumber | Interest Owned(%) |
|---|---|---|
| Mining Lease - Zeehan, Tasmania | ML 2023P/M | 100 |
| Mining Lease - Tailing Dam, Zeehan, Tasmania | ML 2M/2014 | 100 |
| Mining Lease – Pipeline Route, Zeehan, Tasmania | ML 2040P/M | 100 |
| Retention Licence - Zeehan, Tasmania | RL 5/1997 | 100 |
| Mining Lease - St Dizier, Tasmania | ML 10M/2017 | 100 |
| Exploration Licence - Mt Razorback | EL 11/2017 | 100 |
| Exploration Licence - Montana Flats, Zeehan, Tasmania | EL 13/2018 | 100 |
| Exploration Licence - Midgee, South Australia*1 | EL 6350 | 100 |
*1 The initial 2-year term of EL 6350 expired on 25 March 2021. An application for renewal was lodged on 19 February 2021, prior to the required date for renewal applications.
Footnotes / Live Links
2 SRZ Announcement, 16 May 2019, "Updated Heemskirk Resource Increases Indicated Category and Confidence in the Project"
3 SRZ Announcement, 12 April 2021, "Investor Presentation" – See page 11 Benchmarking Assumptions
4 SRZ Announcement, 18 February 2021, "Restart of Tin Exploration Drilling"
5 SRZ Announcement, 26 March 2021, "Expanded Tin Exploration Drilling Program at Heemskirk Tin"
6 SRZ Announcement, 1 October 2019, "Heemskirk Tin Scoping Study Confirms Attractive Economics"
7 SRZ Announcement, 4 March 2021, "Additional NE Tasmania Gold EL Applications"
8 SRZ Announcement, 10 September 2020, "NE Tasmania Gold EL Applications"
Forward Looking Statements
This report may include forward-looking statements. Forward-looking statements include, but are not limited to, statements concerning Stellar Resources Limited's planned activities and other statements that are not historical facts. When used in this report, the words such as "could", "plan", "estimate", "expect", "intend", "may", "potential", "should" and similar expressions are forward-looking statements. In addition, summaries of Exploration Results and estimates of Mineral Resources and Ore Reserves could also be forward-looking statements. Although Stellar Resources Limited believes that its expectations reflected in these forward-looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. The entity confirms that it is not aware of any new information or data that materially affects the information included in this announcement and that all material assumptions and technical parameters underpinning this announcement continue to apply and have not materially changed. Nothing in this report should be construed as either an offer to sell or a solicitation to buy or sell Stellar Resources Limited securities.
This announcement is authorised for release to the market by the Board of Directors of Stellar Resources Limited.
For further details please contact:
Gary Fietz Technical Director Stellar Resources Limited Tel: 0408 489 957 Email: [email protected]
Appendix 5B
Mining exploration entity or oil and gas exploration entity quarterly cash flow report
Name of entity
STELLAR RESOURCES LIMITED
ABN Quarter ended ("current quarter")
96 108 758 961 31 March 2021
| Consolidated statement of cash flows | Current quarter$A'000 | Year to date (9months)$A'000 | |
|---|---|---|---|
| 1. | Cash flows from operating activities | ||
| 1.1 | Receipts from customers | - | - |
| 1.2 | Payments for | ||
| (a)exploration & evaluation | (29) | (170) | |
| (b)development | - | - | |
| (c)production | - | - | |
| (d)staff costs | (30) | (68) | |
| (e)administration and corporate costs | (82) | (275) | |
| 1.3 | Dividends received (see note 3) | - | - |
| 1.4 | Interest received | - | - |
| 1.5 | Interest and other costs of finance paid | - | - |
| 1.6 | Income taxes paid | - | - |
| 1.7 | Government grants and tax incentives | - | - |
| 1.8 | Other (provide details if material) | - | - |
| 1.9 | Net cash from / (used in) operatingactivities | (141) | (513) |
| 2. | Cash flows from investing activities | ||
|---|---|---|---|
| 2.1 | Payments to acquire or for: | ||
| (a)entities | - | - | |
| (b)tenements | - | - | |
| (c)property, plant and equipment | - | - | |
| (d)exploration & evaluation | (29) | (60) | |
| (e)investments | - | - | |
| (f)other non-current assets | - | - |
| Consolidated statement of cash flows | Current quarter$A'000 | Year to date (9months)$A'000 | |
|---|---|---|---|
| 2.2 | Proceeds from the disposal of: | ||
| (a)entities | - | - | |
| (b)tenements | - | - | |
| (c)property, plant and equipment | - | - | |
| (d)investments | - | - | |
| (e)other non-current assets | - | - | |
| 2.3 | Cash flows from loans to other entities | - | - |
| 2.4 | Dividends received (see note 3) | - | - |
| 2.5 | Other (provide details if material) | - | - |
| 2.6 | Net cash from / (used in) investingactivities | (29) | (60) |
| 3. | Cash flows from financing activities | ||
|---|---|---|---|
| 3.1 | Proceeds from issues of equity securities(excluding convertible debt securities) | 2,128 | 4,308 |
| 3.2 | Proceeds from issue of convertible debtsecurities | - | - |
| 3.3 | Proceeds from exercise of options | - | - |
| 3.4 | Transaction costs related to issues of equitysecurities or convertible debt securities | (125) | (256) |
| 3.5 | Proceeds from borrowings | - | - |
| 3.6 | Repayment of borrowings | - | - |
| 3.7 | Transaction costs related to loans andborrowings | - | - |
| 3.8 | Dividends paid | - | - |
| 3.9 | Other (provide details if material) | (1) | (7) |
| 3.10 | Net cash from / (used in) financingactivities | 2,002 | 4,045 |
| 4. | Net increase / (decrease) in cash andcash equivalents for the period | ||
|---|---|---|---|
| 4.1 | Cash and cash equivalents at beginning ofperiod | 2,164 | 524 |
| 4.2 | Net cash from / (used in) operatingactivities (item 1.9 above) | (141) | (513) |
| 4.3 | Net cash from / (used in) investing activities(item 2.6 above) | (29) | (60) |
| 4.4 | Net cash from / (used in) financing activities(item 3.10 above) | 2,002 | 4,045 |
| Consolidated statement of cash flows | Current quarter$A'000 | Year to date (9months)$A'000 | |
|---|---|---|---|
| 4.5 | Effect of movement in exchange rates oncash held | - | - |
| 4.6 | Cash and cash equivalents at end ofperiod | 3,996 | 3,996 |
| 5. | Reconciliation of cash and cashequivalentsat the end of the quarter (as shown in theconsolidated statement of cash flows) to therelated items in the accounts | Current quarter$A'000 | Previous quarter$A'000 |
|---|---|---|---|
| 5.1 | Bank balances | 2,996 | 864 |
| 5.2 | Call deposits | 1,000 | 1,300 |
| 5.3 | Bank overdrafts | - | - |
| 5.4 | Other (provide details) | - | - |
| 5.5 | Cash and cash equivalents at end ofquarter (should equal item 4.6 above) | 3,996 | 2,164 |
| 6. | Payments to related parties of the entity and theirassociates | Current quarter$A'000 |
|---|---|---|
| 6.1 | Aggregate amount of payments to related parties and theirassociates included in item 1 | 77 |
| 6.2 | Aggregate amount of payments to related parties and theirassociates included in item 2 | 18 |
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity report must include a description of, and an explanation for, such payments.
| 7. | Financing facilitiesNote: the term "facility' includes all forms of financingarrangements available to the entity.Add notes as necessary for an understanding of thesources of finance available to the entity. | Total facilityamount at quarterend$A'000 | Amount drawn atquarter end$A'000 | |
|---|---|---|---|---|
| 7.1 | Loan facilities | - | - | |
| 7.2 | Credit standby arrangements | - | - | |
| 7.3 | Other (please specify) | - | - | |
| 7.4 | Total financing facilities | - | - | |
| 7.5 | -Unused financing facilities available at quarter end | |||
| 7.6Include in the box below a description of each facility above, including the lender, interestrate, maturity date and whether it is secured or unsecured. If any additional financingfacilities have been entered into or are proposed to be entered into after quarter end,include a note providing details of those facilities as well. | ||||
| N/A |
| 8. | Estimated cash available for future operating activities | $A'000 | ||
|---|---|---|---|---|
| 8.1 | Net cash from / (used in) operating activities (item 1.9) | (141) | ||
| 8.2 | (Payments for exploration & evaluation classified as investingactivities) (item 2.1(d)) | (29) | ||
| 8.3 | Total relevant outgoings (item 8.1 + item 8.2) | (170) | ||
| 8.4 | Cash and cash equivalents at quarter end (item 4.6) | 3,996 | ||
| 8.5 | Unused finance facilities available at quarter end (item 7.5) | |||
| 8.6 | Total available funding (item 8.4 + item 8.5)3,996 | |||
| 8.7 | Estimated quarters of funding available (item 8.6 divided by24 | |||
| item 8.3)Note: if the entity has reported positive relevant outgoings (ie a net cash inflow) in item 8.3, answer item 8.7 as "N/A".Otherwise, a figure for the estimated quarters of funding available must be included in item 8.7. | ||||
| 8.8 | If item 8.7 is less than 2 quarters, please provide answers to the following questions: | |||
| 8.8.1Does the entity expect that it will continue to have the current level of net operatingcash flows for the time being and, if not, why not? | ||||
| Answer: N/A | ||||
| 8.8.2Has the entity taken any steps, or does it propose to take any steps, to raise furthercash to fund its operations and, if so, what are those steps and how likely does itbelieve that they will be successful? | ||||
| Answer: N/A | ||||
| 8.8.3Does the entity expect to be able to continue its operations and to meet its businessobjectives and, if so, on what basis? | ||||
| Answer: N/A | ||||
| Note: where item 8.7 is less than 2 quarters, all of questions 8.8.1, 8.8.2 and 8.8.3 above must be answered. |
Compliance statement
- 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.
- 2 This statement gives a true and fair view of the matters disclosed.
Date: 21 April 2021
Authorised by: The Board.
Notes
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- This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the entity's activities for the past quarter, how they have been financed and the effect this has had on its cash position. An entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is encouraged to do so.
-
- If this quarterly cash flow report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash
Flows apply to this report. If this quarterly cash flow report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.
-
- Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.
-
- If this report has been authorised for release to the market by your board of directors, you can insert here: "By the board". If it has been authorised for release to the market by a committee of your board of directors, you can insert here: "By the [name of board committee – eg Audit and Risk Committee]". If it has been authorised for release to the market by a disclosure committee, you can insert here: "By the Disclosure Committee".
-
- If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as complying with recommendation 4.2 of the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations, the board should have received a declaration from its CEO and CFO that, in their opinion, the financial records of the entity have been properly maintained, that this report complies with the appropriate accounting standards and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.