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STRIKE RESOURCES LIMITED — Interim / Quarterly Report 2012
Jan 30, 2013
65855_rns_2013-01-30_4ebf00fa-ffed-4223-bfba-82b0eccef2ff.pdf
Interim / Quarterly Report
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Thursday, 31 January 2013
Quarterly Report for the 3 months to 31 December 2012[1]
December 2012 Quarter Highlights
Strike moves to 100% ownership of Apurimac Ferrum
Cuervo Resources (Cuervo) Bob 1 drilling campaign completed – resource estimate due February 2013
Berau coal project dispute settlement agreement signed – Strike to receive US$4.3M by June 2013
- Strong cash balance of A$14.4M at 31 December, with a loan of approximately CA$5.25M[2] to Cuervo Resources
William Johnson appointed Executive Director to replace Mr Hellsten in the senior executive role
Corporate
Strike Moves to 100% of AF
In November 2012 Strike became entitled to purchase D&C’s shares in Peruvian company Apurimac Ferrum ( AF ) for approximately US$3.5M[3] under the AF Shoot-out, payable in three years. D&C held a different interpretation of the Shoot-out rules and the parties entered negotiations to resolve the issue, leading to the execution of a settlement agreement on 20 December, 2012. While Strike was confident of its legal position, the negotiated settlement delivers better value to shareholders than the likely alternative of a protracted legal dispute.
The key commercial terms of the Settlement Agreement are detailed below.
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D&C transferred its 50% shareholding in AF to Strike.
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2,800,000 Strike shares were issued to D&C, with D&C now holding just under 2% of Strike.
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AF repaid D&C’s loans of approximately US$3.5M, funded by Strike.
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D&C will receive the following deferred payments if AF achieves the milestones below:
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US$2M on AF defining a JORC Resource at the Apurimac project of 500 million tonnes ( Mt ) of iron ore with an average grade of at least 55% iron ( Fe ) or 275 Mt of contained iron at an average grade of 52.5% Fe or above.
1 And to the date of this report.
2 Canadian dollars.
3 An amount equal to the loans owed to D&C by AF.
Strike Resources Limited (ABN 94 088 488 724) Level 2, 160 St Georges Terrace Perth Western Australia 6000 Tel: +61 8 9324 7100 Fax +61 8 9324 7199
Web: www.strikeresources.com.au Email: [email protected]
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US$3M on AF achieving environmental and community approvals for the construction of an iron ore mine and associated infrastructure with a design capacity of at least 10 million tonnes per annum ( Mtpa ) of iron ore product.
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US$5M on formal AF Board approval to commence construction of an iron ore project, or the commencement of bulk earthworks for an iron ore processing plant, with a design capacity of at least 10 Mtpa of iron ore product ( Construction Milestone ).
AF is under no obligation to meet the milestones.
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D&C will receive the following royalties:
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1.5% of the net profits from sales of iron ore, and
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2% of the proceeds of sales of base and precious metals (on a net smelter return basis).
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AF is under no obligation to commence production.
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AF may extinguish the royalties by paying D&C any one of the following amounts ( Extinguishment Payment ):
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US$13M within 2 years from 20 December 2012 ( Execution ),
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US$15M between 2 and 3 years from Execution,
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US$20M between 3 and 4 years from Execution, or
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US$30M[4] after 4 years from Execution but before the Construction Milestone occurs or the 15th anniversary of the agreement (whichever is sooner).
Any royalty that is being paid on sales of base and precious metals at the date the Extinguishment Payment is made remains in place, up to a cap of US$500,000 per year.
The Settlement Agreement represents the achievement of Strike’s long-held objective of moving to 100% ownership of AF. Importantly, the acquisition terms were designed to preserve Strike’s cash. Moving to full control of AF enables Strike to focus on driving exploration efforts and progressing key project milestones at Apurimac.
Management Restructure
On 18 January 2013 Mr Ken Hellsten announced his retirement as Managing Director, a position he had held since March 2010.
Following the successful move to 100% ownership of AF, the Company determined that it would be best served by having its key management and technical team based in Lima, Peru. Mr Hellsten is unable to relocate to Peru and the role that will remain in Perth does not warrant a person of his skills and experience. Mr Hellsten will remain in a consulting role until the end of February and retains his role as a Strike appointee on the Board of Cuervo Resources Inc.
Non-Executive Director William Johnson was appointed Executive Director to succeed Mr Hellsten in the senior management role. Mr Johnson has been a Strike Director since 2006, serving in an executive capacity until 2010.
Since securing 100% of AF, Strike’s key focus is on negotiating the community approvals necessary to enable it to re-start drilling on those concessions that have the best prospects of increasing the Company’s resource inventory. Mr Johnson's immediate task as senior executive is to review AF's management structure, resource levels and forward plans to ensure that it is best positioned to achieve this outcome.
Cash Position
Strike’s total cash holding on 31 December 2012 was approximately A$14.4M. In addition, Strike holds a loan of CA$5.25M to Cuervo Resources Inc. A cash payment of US$4.3M is due to be received by June 2013 from settlement of the Berau coal dispute.
4 This amount is indexed to changes in the US CPI, commencing on the second anniversary of the execution of the Shootout Settlement Agreement.
Strike Resources / December 2012 Quarterly Report / 2
Strike Resources: Peruvian Projects
Overview
Apurimac Project (Strike - 100%)
Strike holds concessions covering almost 600 square km of highly prospective ground in the AndahuaylasYauri mineral province in the Apurimac district of southern Perú (see figure 1 , below). The most advanced prospect, Opaban, currently contains iron ore resources totalling 269 Mt at an average grade of 57.3% Fe.
The resource is high quality, being dominantly course-grained and friable magnetite, which provides several competitive advantages. The high grade gives excellent potential for direct shipping ore ( DSO ) as well as producing high-quality product using conventional magnetic separation techniques. Metal recoveries are more than twice that seen in most magnetite deposits. The coarse-grained nature of the ore provides significant energy savings; as only coarse grinding is required to liberate the magnetite. The combination of these factors delivered a potential project with competitive capital costs and low operating costs in an initial Pre-feasibility Study completed in 2008.
The current focus of AF’s activities at Apurimac is to meet its exploration target of least 500 Mt of iron ore (including current the present resource) at a grade of 56 – 58% Fe (similar to the Opaban deposit grade) to support the establishment of a 15 – 20 Mtpa mine.
(The potential quantity of the target iron ore in this section of this document is conceptual in nature. There has been insufficient exploration to define an additional Mineral Resource in relation to that target iron ore. It is uncertain whether further exploration will result in the determination of an additional Mineral Resource in relation to that target iron ore.)
Figure 1 – Apurimac and Cusco Project concessions
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Cusco Project (Santo Tomas) (Strike - 100%)
Strike also holds concessions covering approximately 13 square km in the Cusco district of southern Perú (see figure 1 , above). An initial inferred resource estimate of 104 Mt at 32.6% Fe was reported for these concessions in 2011, although this was based on an interpretation that the deposit was comprised of
Strike Resources / December 2012 Quarterly Report / 3
primarily steep-dipping, structurally controlled magnetite zones. The current interpretation of the deposit is that the bulk of the mineralisation is stratiform in nature, and hence the current resource estimate is believed to understate the resources in terms of both tonnes and grade. At this stage a revised resource estimate is not considered essential until further drilling is completed.
The Santo Tomas project corresponds with good magnetic anomalies, as well as alteration and iron anomalies from the ASTER data. The drilling program to date has tested 30 – 40% of the target area for iron ore and further drilling will be conducted at a future date.
The style of iron-ore mineralisation at Santo Tomas is similar to that seen at Opaban; being coarse-grained and dominated by magnetite. Preliminary metallurgical tests indicate a concentrate grade of >65% Fe can be produced from this ore using conventional grinding and magnetic separation processes.
AF’s Cusco concessions lie within 20 km of the Cerro Ccopane iron ore project of Cuervo Resources (see below) where iron ore resources of 179 Mt at an average grade of 48% Fe have been outlined and initial drill testing of the Bob 1 target area has recently been completed.
Apurimac Iron Ore Project
Regional exploration review
During the December quarter AF completed a review of previous exploration data within the Apurimac concessions and the interpretation of high-quality remote sensing data. The objective of the review was to assess the potential for iron ore and copper/gold within its concessions and adjacent areas, to prioritise exploration targets and community relations programs to secure exploration access agreements.
The data review included a compilation of the available airborne and ground magnetic surveys, geological mapping at the reconnaissance and prospect level, regional geochemistry, surface sampling and drilling results and the interpretation of detailed multi-spectral remote sensing (ASTER) data by an independent expert. The outcome of the review was the creation of a series of ranked exploration targets.
The review also identified a number of high-priority satellite deposits in the Apurimac concessions, warranting further magnetic surveys and additional reconnaissance mapping and sampling prior to drill testing. The key potential satellite targets Sillaccassa and Colcabamba are covered in detail below.
The top priority drilling area remains the Opaban prospect and, in particular, the extension of the existing resources at both Opaban I and Opaban III. The strike length of the magnetic anomaly on Opaban I and III is approximately 5.4 kilometres in Strike-owned concessions. Drilling presently only covers 50% of this area, so there is strong potential to discover additional iron ore on these properties. Analysis to identify the relative contributions of exoskarn (limestone hosted) and endoskarn (intrusive hosted) to the current Opaban resource will be undertaken. The results of this analysis will affect the design of the proposed Opaban resource extension drilling program and the exploration programs for adjacent AF concessions that have the potential to extend and/or repeat the Opaban deposits.
Re-commencement of drilling at Opaban depends upon securing access approvals from the communities on whose land the concessions are located; which is discussed further in the Social Approvals and Community Relations section below.
Sillaccassa - The Sillaccassa concession block lies approximately 25 km west of Opaban. Exploration to date has identified three magnetic anomalies; two of which extend for more than one kilometre and have coincident outcropping magnetite-rich ironstones. Iron grades from rock-chip sampling of the ironstones, which extend for approximately one kilometre in strike length, averaged 69% Fe.
Based on the extent of the magnetic anomalies and ironstones these concessions have been assessed to have potential to contain 50 – 150 Mt of iron ore at grades of 35 – 60% Fe. Accordingly, this area could provide a significant satellite resource for an iron ore operation at Opaban.
(The potential quantity of the target iron ore in this section of this document is conceptual in nature. There has been insufficient exploration to define an additional Mineral Resource in relation to that target iron ore. It is uncertain whether further exploration will result in the determination of an additional Mineral Resource in relation to that target iron ore.)
The ASTER interpretation identifies this area as being of moderate to high importance, with a broad area of iron oxides, iron hydroxides, and iron silicates with clays and a magnetic anomaly. This area presents interesting zones of alteration nested in the area between northeast and east-northeast lineaments and zones of magnetic highs. A ground geophysical survey and 1:5000 scale mapping program were completed
Strike Resources / December 2012 Quarterly Report / 4
in 2011. A summary of these results is presented in figure 2 , annexed to this report[5] . The surface area of the magnetite outcrop is shown on this plan.
Exploration activities in this area were placed on hold during the regional protests which occurred in late 2011 and early 2012. Subsequently, community relations programs have focussed on the Opaban and Santo Tomas areas. AF intends to re-engage with the community at Sillaccassa when the opportunity arises. The next stage of work will include conducting check mapping, the extension of the ground magnetics into recently acquired concessions and drill testing.
Colcabamba - The Colcabamba project is 30 km to the south of the Company’s Opaban concessions and is considered to be a potential satellite deposit. The iron ore is hosted by regional metasomatic skarns developed in both limestone roof pendants and diorite within the Andahuaylas-Yauri batholith.
Field mapping at a 1:5000 scale and ground magnetics were undertaken at Colcabamba. Figure 3 , annexed , shows magnetic anomalies and the magnetite outcrops identified by field mapping. The surface area of the magnetite outcrops are shown on this plan.
Colcabamba shows good ASTER iron anomalies as well as magnetic anomalies. The mapping shows numerous outcrops of diorite and monzodiorite in contact with limestones. The location of mapped diorite corresponds with a string of north-west trending magnetic highs. The main zone of interest is in the east where large iron oxide/silicon and gossan anomalies are flanking the magnetic highs and are associated with copper/iron anomalies.
Although high-grade magnetite was intersected in all of the eight holes drilled in 2011, the intersections were generally narrower than expected when interpreted as being controlled by sub-vertical structures. The review determined that Colcabamba represents an attractive exploration target if the deposit is interpreted as dominantly exoskarn instead. This interpretation needs to be tested by further drilling.
The presence of multiple phases of intrusives, anomalous copper and relatively high sulphur content at Colcabamba make it strongly prospective for copper/gold including skarn, epithermal and porphyry styles.
AF has current environmental approval for drilling from a further 12 platforms in the area. As previously announced, however, the local community withdrew its drilling approval in 2012. When access is regained, AF will undertake an IP program and complete the drilling.
Cusco Project, Santo Tomas Prospect
Regional exploration review
Strike’s Cusco concessions were included in the regional review referred to in the Apurimac Project section above. Two concessions show ASTER iron and alteration anomalies. The ASTER interpretation has also shown numerous copper anomalies on the periphery of Santo Tomas. Two strong circular/semi-circular magnetic anomalies with apparent alteration overprint consisting of gossan/high sulphidation type are also present. The review recommended conducting further drilling, aimed at increasing the resource estimate for Santo Tomas, based on applying an interpretation using stratigraphic rather than structural controls.
The review also assessed the copper/gold potential of the Cusco concessions. Malachite and azurite were identified in surface mapping and artisanal (informal) gold mining is understood to occur in the area. Only low levels of copper and gold were identified during previous drilling. An Induced Polarization ( IP ) survey was undertaken in order to assess the potential for a large porphyry copper/gold system. The surface extent of this survey was limited by community access agreements. There was no indication of a large porphyry system to a depth of 700m but several small chargeable bodies were identified, which will be followed up during a subsequent drilling campaign.
The small chargeable bodies which were identified during the IP survey have also been recommended for further investigation. If these IP anomalies are associated in fact with occurrences of high-value metals then this would make a significant difference to the economic potential of the Santo Tomas project.
5 The remaining figures commence on Page 13.
Strike Resources / December 2012 Quarterly Report / 5
Social Approvals and Community Relations
During the December 2012 quarter AF reopened dialogue with the important community of Huinchos, located on its Opaban I concession, which was put on hold earlier in the year following the increase in regional activism that began in late 2011.
In November 2012 AF completed construction of a multipurpose sports field for the Huinchos community, which has been very well received. AF was granted permission to open a community information office in the community. Through this office AF is able to provide information to community members about the iron exploration and development process. AF is in discussions with other villages within the Huinchos community about the potential to build them additional sporting facilities and open further information offices.
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Huinchos sports field
In 2012 the Peruvian Government commenced a program to encourage artisanal (informal) miners to bring their activities within the law. In general terms, the new regime permits informal miners to continue to operate if they obtain the support of the relevant concession owners and comply with certain environmental and safety standards. AF considers that there may be potential mutual benefits in assisting informal miners on its concessions to register under the new system. Informal mining on AF's concessions is on a small scale and does not have a significant impact on the Company’s operations, but can be an important source of revenue for locals. AF organised a meeting between Huinchos community leaders and the Regional Mining Office to discuss the formalisation process and environmental management issues.
During the quarter AF continued its program of arranging community trips to commercial farming operations to study best-practice agricultural methods. These trips are well regarded by participants and the wider communities generally who benefit from the knowledge transfer.
Local elections were held in most of the communities on AF’s concessions at the end of 2012. Transition to new leadership has generally been smooth, with no material impact on relationships with AF.
Strike Resources / December 2012 Quarterly Report / 6
The AF community relations team was restructured during the Shoot-out and Luis Romero was appointed as the new Manager – Social Responsibility and is performing well in this role. The key focus of the Strike/AF management restructure is to determine the priorities and resourcing needs of the community relations team and provide whatever additional resources it needs to secure drilling access approvals. Strike is hopeful of obtaining community approvals to recommence drilling on the Opaban I and III concessions during the first half of calendar 2013 and will keep shareholders updated on developments.
Millenium Trading S.A.C.
A new arbitrator has been appointed to conduct the Millenium arbitration, to replace his predecessor who stepped down due to a conflict of interest arising. Millenium is pursuing a procedural challenge against the installation of the new arbitrator. Assuming the arbitrator's appointment is upheld it is expected that he will then set a timetable to conclude the case.
Millennium and Minera Apu (which Strike believes to be acting in concert with Millenium) are also pursuing various procedural motions and appeals designed to keep alive their court cases challenging the validity of AF’s acquisition of certain concessions. AF regards these actions as having no merit and is defending them strongly.
Cuervo Resources Inc. Projects[6]
Bob 1 Drilling Campaign Completed
Earlier in January Cuervo Resources Inc. released assay results from the final two holes from drilling on the “Bob 1” target zone of its Cerro Ccopane iron ore project in Peru. Significant intercepts from the final holes were 112.5 metres at 49.3% Fe from BDH12-17 and 35.4 metres at 52.4% Fe from BDH12-18 (drill hole locations are shown in Figure 4, annexed).
The Bob 1 magnetic and gravity target extends over a total strike length of approximately three kilometres (see Figures 4 and 5 , annexed), with extensive outcrops of massive magnetite present along the bulk of the length of the target. Cuervo has completed the current program of 18[7] drill holes for approximately 4500 metres of drilling as an initial test of Bob 1. The initial resource estimate is planned for completion in February 2013.
Technical Results
The drill holes were directed to test the surface exposures of magnetite and the gravity and magnetic targets from surface to a depth of around 200 metres, although selected holes were drilled to more than 400 metres.
All drill holes completed to date at Bob 1 have intersected zones of magnetite-rich rocks, with several intervals of massive magnetite interspersed with intervals of semi-massive to disseminating magnetite and intermediate composition intrusives. The magnetite and sulphides (mainly pyrite) are generally of similar grain size to that seen at Cuervo’s Orcopura prospect, approximately 20 kilometres to the south-southwest (see Figure 1 , annexed).
The results are in line with initial expectations, with key outcomes being:
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A strong and continuous zone of largely massive magnetite, generally 100 – 150 metres in true thickness, has been outlined in the central and northern portion of the Bob 1 anomaly. This mineralised system has been traced over a strike length of at least 2000 metres and remains open in all directions; with the high-grade, massive magnetite extending over at least a 1200 metre strike. The deposit dips moderately (40 – 60 degrees) to the west and has been traced from extensive surface outcrops to a depth at least 200 metres on most drill sections and up to nearly 400 metres on some. The bulked intercepts within this zone generally contain grades of 40% - 50% Fe and as high as 57% Fe.
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Drilling in the southern portion of Bob 1 is relatively limited (five holes) although results to date suggest the massive magnetite zones are generally multiple narrower systems with similar geometry to the
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6 Strike has advanced Cuervo CA$5.25M to fund its current (Stage 1) drilling and exploration program and, in return, was issued warrants that can be converted to 31.5% of Cuervo’s shares on an undiluted basis, at CA$0.30 per share.
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7 Hole BDH12-09 was abandoned before reaching the target depth due to drilling difficulties.
Strike Resources / December 2012 Quarterly Report / 7
central/northern zone. Bulked intervals are generally narrower (30 – 60 metres) and with lower grade (20 – 40% Fe) than those in the north. Given the broadly spaced nature of the holes in this area, further drilling is required to fully assess this mineralised system, as large parts of the geophysical anomaly are yet to be drilled.
While the current drilling program is only an initial test of portions of the Bob 1 target, the results to date are considered most encouraging, due to the continuity of the iron ore along and across strike as well as at depth. Table 1, below, provides summary results from the entire campaign.
Table 1 - Significant intersections in drill holes BDH12-01 to BDH12-18
| Hole | From | To | Length | Fe (%) | SiO2 (%) | S (%) | P (%) | Mn (%) | Cu (%) |
|---|---|---|---|---|---|---|---|---|---|
| BDH12-01 | 86.2m | 219.2m | 133m | 49.6 | 14.4 | 2.36 | 0.09 | 0.14 | 0.11 |
| BDH12-02 | 12.35m | 194.35m | 182m | 39.6 | 23.2 | 2.30 | 0.08 | 0.16 | 0.10 |
| BDH12-03 | 19.2m | 175.2m | 156m | 40.9 | 23.3 | 2.92 | 0.06 | 0.19 | 0.12 |
| BDH12-04 | 66.1m | 255m | 188.9m | 32.6 | 28.5 | 1.80 | 0.08 | 0.23 | 0.06 |
| BDH12-05 | 35.8m | 179.55m | 143.75m | 38.3 | 22.6 | 1.83 | 0.09 | 0.20 | 0.08 |
| BDH12-06 | 71.3m | 181.9m | 110.6m | 41.1 | 21.1 | 2.79 | 0.08 | 0.17 | 0.10 |
| BDH12-07 | 219.45m | 311.45m | 92m | 36.6 | 24.5 | 2.64 | 0.07 | 0.22 | 0.09 |
| BDH12-08 | 45.1m | 230m | 184.9m | 47.5 | 16.7 | 2.30 | 0.09 | 0.11 | 0.11 |
| BDH12-09 | abandoned | ||||||||
| BDH12-10 | 83.10m | 210.20m | 217.10m | 54.1 | 10.0 | 2.67 | 0.06 | 0.12 | 0.13 |
| BDH12-11 | 25.70m | 112.25m | 86.55m | 33.8 | 25.8 | 0.55 | 0.06 | 0.23 | 0.04 |
| BDH12-12 | 216.80m | 390.15m | 173.35m | 30.1 | 26.5 | 2.17 | 0.07 | 0.20 | 0.08 |
| BDH12-13 | 272.40m | 299.20m | 26.80m | 23.3 | 34.0 | 1.22 | 0.12 | 0.22 | 0.05 |
| BDH12-14 | 267.75m | 291.00m | 23.25m | 29.6 | 27.9 | 2.41 | 0.06 | 0.21 | 0.07 |
| BDH12-15 | 190.30m | 237.00m | 46.70m | 19.9 | 35.4 | 1.70 | 0.07 | 0.22 | 0.06 |
| BDH12-16 | 18.30m | 83.40m | 65.10m | 40.9 | 21.2 | 1.27 | 0.06 | 0.17 | 0.09 |
| BDH12-17 | 67.3m | 179.8m | 112.5m | 49.3 | 14.7 | 2.81 | 0.04 | 0.11 | 0.12 |
| BDH12-18 | 5.3m | 40.7m | 35.4m | 52.4 | 11.2 | 1.46 | 0.12 | 0.14 | 0.09 |
The independent geologist conducting the resource estimate has monitored all drilling, sampling and assaying and has commenced the formal resource estimate process now that the final assay results have been received. The resource estimate is expected to be released in late February, 2013.
Preliminary low-intensity magnetic separation (Davis Tube) carried out previously on selected samples of sulphide-rich mineralisation from the Orcopura zone showed that both pyrite and chalcopyrite (copperbearing sulphide) can be removed from that ore to produce a high-grade iron ore concentrate. Cuervo plans to carry out Davis Tube processing on samples of the Bob 1 iron ore following release of the resource estimate. The Bob 1 Davis Tube results are expected to be similar to those from Orcopura, given the similarity of the magnetite at these prospects.
Background Information
The Bob 1 zone is considered highly prospective for iron ore. It contains strong magnetic and gravity anomalies (see Figures 1 and 2 , attached) coincident with a broad band of magnetite outcrops extending over three kilometres in strike length, the largest yet identified on the Cerro Ccopane property. Rock chip samples from these outcrops averaged >63% Fe and the prospect is geologically similar to the Orcopura, Huillque and Aurora areas where previous drilling has outlined iron ore resources totalling 179 Mt at an average grade of 48.2% Fe (see Table 2 , over the page, for a full breakdown of JORC Code categories and grades).
Strike Resources / December 2012 Quarterly Report / 8
Table 2 - Cerro Ccopane Project resources
| Prospect | Classification | Tonnes (Mt) | Head Fe (%) | Cut-off Fe (%) |
|---|---|---|---|---|
| Orcopura | Measured | 19.7 | 48.26 | 20 |
| Indicated | 35.9 | 45.91 | 20 | |
| (Measured plus Indicated) | 55.6 | 46.75 | 20 | |
| Orcopura | Inferred | 51 | 43.7 | 20 |
| Or | ||||
| Prospect | Classification | Tonnes (Mt) | Head Fe (%) | Cut-off Fe (%) |
| Orcopura | Inferred* | 46 | 45.8 | 30 |
| Huillque and Aurora | Inferred | 72 | 52.6 | 30 |
| Total | Inferred | 118 | 50.4 | 30 |
*Showing the inferred resource at Orcopura (previously modelled using a 20 % lower cut) now using a 30% lower cut, to enable a comparison between that resource and the inferred resource now defined at the Huillque and Aurora prospects.
Strike advanced Cuervo CA$5.25M to fund the drilling campaign and, in return, was granted warrants that can be converted into approximately 31.5% of Cuervo’s shares, on an undiluted basis. Alternatively, Strike can require repayment of the loan when its term expires in mid-2014.
The Cerro Ccopane project lies within 20 kilometres of Strike’s Santo Tomas (Cusco) iron ore project (see Figure 3 , attached).
Other Projects
Berau Thermal Coal Project – Indonesia[8]
On 7 December 2012, after protracted negotiations, Strike and its partner signed a set of agreements to settle the dispute over the Berau Coal Project. In summary, Strike will receive US$4.3M by June 2013 and exit the project.
Paulsens East Iron Ore Project – Pilbara, Western Australia[9]
In December 2012 Strike conducted a review of the gold potential of these tenements due to their proximity to Northern Star Resources Ltd’s Paulsens gold mine. The review concluded that the tenements have low gold potential and, accordingly, the Company does not plan to explore for gold.
Previous drilling has identified iron ore at Paulsens however the Company has not released a resource estimate. Iron ore mining at Paulsens is not considered to be economically feasible under current conditions, given the quantities or ore present, the market price and the lack of port access within reasonable proximity. Strike is assessing its options for Paulsens. The preferred option at this stage is retention with a view to reassessing its potential in future if the port access situation improves or there is a material and sustainable increase in iron ore prices, bringing other transport options into play.
8 Strike’s rights in this project consist of 100% of the rights to mine a coal concession, subject to payment of a royalty to the concession owner. Strike’s interest will be terminated upon payment of the settlement amount.
9 100% owned by Strike.
Strike Resources / December 2012 Quarterly Report / 9
Mineral Tenements (as at 31 December 2012)
Perú (Strike - 100%)
Apurimac Project tenements
| Mineral Tenements (as at 31 December 2012) Perú (Strike - 100%) |
Mineral Tenements (as at 31 December 2012) Perú (Strike - 100%) |
Mineral Tenements (as at 31 December 2012) Perú (Strike - 100%) |
Mineral Tenements (as at 31 December 2012) Perú (Strike - 100%) |
Mineral Tenements (as at 31 December 2012) Perú (Strike - 100%) |
Mineral Tenements (as at 31 December 2012) Perú (Strike - 100%) |
|---|---|---|---|---|---|
| Apurimac Project tenements | |||||
| Name | Area (Ha) | Province | Code | Title | File No |
| (1) Opaban I | 999 | Andahuaylas | 05006349X01 | No 8625-94/RPM Dec 16, 1994 | 20001465 |
| (2) Opaban III | 990 | Andahuaylas | 05006351X01 | No 8623-94/RPM Dec 16, 1994 | 20001464 |
| (3) Los Andes I | 999 | Andahuaylas | 05006372X01 | No 0134-95-RPM Jan 31, 1995 | 200001481 |
| (4) Pitumarca II | 1,000 | Andahuaylas | 05006385X01 | No 8686-94-RPM Dec 22, 1994 | 20001478 |
| (5) Lucrecia Esperanza |
66 | Andahuaylas | 01-00649-99 | No 00623-2001-INACC/J Jul 26, 2001 | 11032475 |
| (6) Nueva Oropampa 6 |
400 | Andahuaylas | 01-00860-99 | No 04043-2000-RPM Oct 13, 2000 | 11032603 |
| (7) Mapsa 2001 | 800 | Andahuaylas | 01-01204-01 | No 00590-2002-INACC/J Apr 8, 2002 | 11032600 |
| (8) Coriminas II | 1,000 | Andahuaylas | 01-01624-99 | No 02760-2000-RPM Jul 25, 2000 | 11032965 |
| (9) Coriminas V | 1,000 | Andahuaylas | 01-01626-99 | No 0936-00-RPM Mar 16, 2000 | 20003140 |
| (10) Ferrum 1 | 965 | Andahuaylas | 01-02983-04 | No 00228-2005-INACC/J Jan 19, 2005 | 11053798 |
| (11) Ferrum 2 | 1,000 | Andahuaylas | 01-02984-04 | No 00227-2005-INACC/J Jan 19, 2005 | 11053836 |
| (12) Ferrum 3 | 1,000 | Andahuaylas | 01-02985-04 | No 00229-2005-INACC/J Jan 19, 2005 | 11053807 |
| (13) Ferrum 4 | 1,000 | Andahuaylas/ Aymaraes |
01-02986-04 | No 00230-2005-INACC/J Jan 19, 2005 | 11053810 |
| (14) Ferrum 5 | 959 | Aymaraes | 01-02987-04 | No 00323-2005-INACC/J Jan 25, 2005 | 11053816 |
| (15) Ferrum 7 | 437 | Aymaraes | 01-02989-04 | No 00396-2005-INACC/J Jan 27, 2005 | 11053822 |
| (16) Ferrum 8 | 900 | Andahuaylas | 01-02990-04 | No 00232-2005-INACC/J Jan 19, 2005 | 11053827 |
| (17) Ferrum 9 | 1,000 | Aymaraes | 01-02991-04 | No 00326-2005-INACC/J Jan 25, 2005 | 11053830 |
| (18) Ferrum 10 | 1,000 | Aymaraes | 01-02992-04 | No 00325-2005-INACC/J Jan 25, 2005 | 11053833 |
| (19) Ferrum 11 | 1,000 | Aymaraes | 01-02993-04 | No 02512-2005-INACC/J Jun 16, 2005 | 11053835 |
| (20) Ferrum 13 | 600 | Andahuaylas | 01-03139-06 | No 4416-2006-INACC/J Oct 16, 2006 | 11061068 |
| (21) Ferrum 26 | 827 | Andahuaylas | 01-02274-07 | No 000853-2007-INGEMMET/PCD/PM Sept 7, 2007 | 11073793 |
| (22) Ferrum 27 | 1,000 | Andahuaylas | 01-02629-07 | No 000581-2007-INGEMMET/PCD/PM Sept 5, 2007 | 11073799 |
| (23) Ferrum 36 | 1,000 | Andahuaylas | 10553307 | RP 0176-2008-INGEMMET/PCD/PM Feb 29, 2008 | 11075418 |
| (24) Cristoforo 22 | 379 | Andahuaylas | 01-01656-02 | RP2849-2007-INGEMMET/PCD/PM Dec 13, 2007 | 11067786 |
| (25) Ferrum 28 | 1,000 | Andahuaylas | 10507407 | RP0601-2008-INGEMMET/PCD/PCM Mar 07, 2008 | 11075423 |
| (26) Ferrum 29 | 1,000 | Andahuaylas | 10507507 | RP0365-2008-INGEMMET/PCD/PM Mar 07, 2008 | 11075419 |
| (27) Ferrum 30 | 963 | Andahuaylas | 10525907 | PP 1024-2008-INGEMMET/PCD/PM May 05, 2008 | 11076757 |
| (28) Ferrum 31 | 327 | Andahuaylas | 10552807 | RP 1266-2008-INGEMMET/PCD/PM May 12, 2008 | 11076509 |
| (29) Ferrum 32 | 900 | Andahuaylas | 10552907 | RP0402-2008-INGEMMET/PCD/PM Mar 07, 2008 | 11075425 |
| (30) Ferrum 33 | 900 | Andahuaylas | 10553007 | RP0547-2008-INGEMMET/PCD/PM Mar 07, 2008 | 11075421 |
| (31) Ferrum 34 | 800 | Andahuaylas | 10553107 | RP0764-2008-INGEMMET/PCD/PM Apr 17, 2008 | 11075427 |
| (32) Ferrum 35 | 1,000 | Andahuaylas | 10553207 | RP0347-2008-INGEMMET/PCD/PCM Mar 07, 2008 | 11075426 |
| (33) Ferrum 37 | 695 | Andahuaylas | 10621507 | RP 1164-2008-INGEMMET/PCD/PM May 12, 2008 | 11076534 |
| (34) Ferrum 56 | 1,000 | Andahuaylas | 10133508 | RP 1971-2008-INGEMMET/PCD/PM Jun 19, 2008 | 11077123 |
| (35) Ferrum 57 | 1,000 | Andahuaylas | 10133608 | RP 3279-2008-INGEMMET/PCD/PM Sept 9, 2008 | 11081417 |
| (36) Ferrum 58 | 1,000 | Andahuaylas | 10133708 | RP 2206-2008-INGEMMET/PCD/PM 27 Jun, 2008 | 11077127 |
| (37) Ferrum 59 | 1,000 | Andahuaylas | 10133808 | RP 2272-2008-INGEMMET/PCD/PM 27 Jun, 2008 | 11077122 |
| (38) Ferrum 61 | 1,000 | Aymaraes | 10073308 | - | in process |
| (39) Pacunco 1 | 800 | Andahuaylas | 10019508 | RP 1806-2008-INGEMMET/PCD/PM May 29, 2008 | 11076523 |
| (40) Minas Huaycco |
800 | Abancay | 10168708 | RP 2541-2008-INGEMMET/PCD/PM Aug 08, 2008 | 11081416 |
| (41) Roncco | 400 | Aymaraes | 10521708 | Notification 153150-2008 INGE<<ET 30 Oct, 2008 | TBA |
| (42) Ferrum 12 | 700 | Andahuaylas | 10299404 | RP 030326-2005-INACC/J 25 Jan, 2005 | TBA |
| (43) Sillaccassa 3 | 200 | Andahuaylas | 10491311 | RP 000192-2012-INGEMMET/PCD/PM 30 Mar, 2012 | TBA |
| (44) Ferrum 21 | 999 | Lucanas | 10027007 | RP 129-2008-MEM/CM 21 Apr, 2008 | TBA |
Strike Resources / December 2012 Quarterly Report / 10
Apurimac Project tenements
| Apurimac Project tenements | Apurimac Project tenements | Apurimac Project tenements | Apurimac Project tenements | Apurimac Project tenements | Apurimac Project tenements |
|---|---|---|---|---|---|
| Name | Area (Ha) | Province | Code | Title | File No |
| (45) Cassio 100 | 400 | Andahuaylas | 10182808 | RP 003321-2008- INGEMMET/PCD/PM 10 Sep, 2009 |
TBA |
| (46) Ferrum 25 | 1,000 | Andahuaylas | 10227307 | TBA | TBA |
| (47) Ferrum 19 | 1,000 | Cotabombas | 10026807 | RP 006426-2008-INGEMMER/PCD/PM 30 Dec, 2008 |
TBA |
| (48) Ferrum 6 | 1,000 | Aymaraes | 10298804 | RP 00231-2005-INACC/J 19 Jan, 2005 | TBA |
| (49) Ferrum 64 | 600 | Andahuaylas | 10073108 | RP 000647-2009-INGEMMET/PCD/PM 27 Feb, 2009 | TBA |
| (50) Ferrum 20 | 800 | Cajamarca | 10026907 | RP 000064-2009-INGEMMET/PCD/PM 28 Jan, 2009 | TBA |
| (51) Ferrum 16 | 1,000 | Chumbivilcas | 10026507 | RP 001979-2007-INACC/J 24 May, 2007 | TBA |
| (52) Ferrum 38 | 800 | Andahuaylas | 10623507 | RP1288-2008-INGEMMET/PCD/PM May 12, 2008 | 11064280 |
| (53) Ferrum 39 | 1,000 | Andahuaylas | 10131408 | RP 1573-2008-INGEMMET/PCD/PM May 29, 2008 | 11076755 |
| (54) Ferrum 40 | 1,000 | Andahuaylas | 10131508 | RP 2905-2008-INGEMMET/PCD/PM Aug 19, 2008 | 11079783 |
| (55) Ferrum 41 | 1,000 | Andahuaylas | 10131608 | RP 1965-2008-INGEMMET/PCD/PM Jun 19, 2008 | 11077113 |
| (56) Ferrum 42 | 1,000 | Andahuaylas | 10131708 | RP 1975-2008-INGEMMET/PCD/PM Jun 19, 2008 | 11077114 |
| (57) Ferrum 43 | 1,000 | Andahuaylas | 10131808 | RP 3243-2008-INGEMMET/PCD/PM Sept 9, 2008 | 11081446 |
| (58) Ferrum 44 | 1,000 | Andahuaylas | 10131908 | RP 1934-2008-INGEMMET/PCD/PM Jun 19, 2008 | 11077115 |
| (59) Ferrum 45 | 1,000 | Andahuaylas | 10132008 | RP 2283-2008-INGEMMET/PCD/PM Jun 27, 2008 | 11077116 |
| (60) Ferrum 46 | 1,000 | Andahuaylas | 10132108 | RP 2523-2008-INGEMMET/PCD/PM Aug 08, 2008 | 11079784 |
| (61) Ferrum 47 | 1,000 | Andahuaylas | 10132208 | RP 1908-2008-INGEMMET/PCD/PM Jun 18, 2008 | 11077117 |
| (62) Ferrum 48 | 1,000 | Andahuaylas | 10132308 | RP 1756-2008-INGEMMET/PCD/PM May 29, 2008 | 11076584 |
| (63) Ferrum 49 | 1,000 | Andahuaylas | 10132408 | RP 2000-2008-INGEMMET/PCD/PM Jun 19, 2008 | 11077118 |
| (64) Ferrum 50 | 900 | Andahuaylas | 10132508 | RP 1922-2008-INGEMMET/PCD/PM Jun 19, 2008 | 11077120 |
| (65) Ferrum 51 | 1,000 | Andahuaylas | 10132608 | RP 1893-2008-INGEMMET/PCD/PM Jun 18, 2008 | 11077121 |
| (66) Ferrum 52 | 1,000 | Andahuaylas | 10132708 | RP 2803-2008-INGEMMET/PCD/PM Aug 18, 2008 | 11079786 |
| (67) Ferrum 53 | 1,000 | Andahuaylas | 10132808 | RP 2550-2008-INGEMMET/PCD/PM Aug 08, 2008 | 11079787 |
| (68) Ferrum 54 | 700 | Andahuaylas | 10132908 | RP 2899-2008-INGEMMET/PCD/PM Aug 19, 2008 | 11079788 |
| (69) Ferrum 55 | 800 | Andahuaylas | 10133408 | RP 2951-2008-INGEMMET/PCD/PM Aug 19, 2008 | 11079789 |
| (70) Ferrum 60 | 200 | Abancay | 10073208 | RP 6379-2008-INGEMMET/PCD/PM Dec 29, 2008 | 11084879 |
| (71) Ferrum 62 | 900 | Abancay | 10073408 | RP 3147-2008-INGEMMET/PCD/PM Aug 28, 2008 | 11079791 |
| (72) Ferrum 63 | 300 | Grau | 10073008 | RP 1492-2008-INGEMMET/PCD/PM May 26, 2008 | 11076586 |
| (73) Pichirhua 1 | 800 | Abancay | 10151708 | RP 2638-2008-INGEMMET/PCD/PM Aug 11, 2008 | 11079794 |
| (74) Pichirhua 2 | 400 | Abancay | 10151808 | RP 3244-2008-INGEMMET/PCD/PM Sept 9, 2008 | 11081445 |
| (75) Colcabamba 1 | 600 | Aymaraes | 10212308 | RP 2986-2008-INGEMMET/PCD/PM Aug 19, 2008 | 11079780 |
| (76) Colcabamba 2 | 500 | Aymaraes | 10212408 | RP 3177-2008-INGEMMET/PCD/PM Sept 8, 2008 | 11081451 |
| (77) Colcabamba 3 | 900 | Aymaraes | 10217208 | RP 3040-2008-INGEMMET/PCD/PM Aug 28, 2008 | 11079781 |
| (78) Colcabamba 4 | 400 | Aymaraes | 10580108 | RP 1117-2009-INGEMMET/PCD/PM Mar 31, 2009 | 11093827 |
| (79) Sillaccassa 1 | 700 | Andahuaylas | 10212508 | RP 5088-2008-INGEMMET/PCD/PM Nov 19, 2008 | 11084877 |
| (80) Sillaccasa 2 | 400 | Andahuaylas | 10212608 | RP 3183-2008-INGEMMET/PCD/PM Sept 8, 2008 | 11081449 |
| (81) Helimag 1 | 900 | Andahuaylas | 10294109 | No 000741-2010 INGEMMET/PCD/PM Mar 22, 2010 | TBA |
| (82) Quimsa 1 | 1,000 | Melgar | 10248007 | RP 000913-2007-INGEMMET/PCD/PM Sept 7, 2007 | TBA |
| (83) Quimsa 2 | 1,000 | Melgar | 10246007 | RP 000345-2007-INGEMMET/PCD/PM Aug 09, 2007 | TBA |
| (84) Pucaccasa | 600 | Andahuaylas | 10353408 | RP 005978-2008-INGEMMET/PCD/PM Dec 17, 2008 | TBA |
| Cusco Project tenements | Cusco Project tenements | ||||
|---|---|---|---|---|---|
| Name | Area (Ha) | Province | Code | Title | File No. |
| (1) Flor de María | 907 | Chumbivilcas | 05006521X01 | No 7078-95-RPM Dec 29, 1995 | 20001742 |
| Cusco Project | Cusco Project | tenements | tenements | tenements | tenements | tenements |
|---|---|---|---|---|---|---|
| Name | Area (Ha) | Province | Code | Title | File No. | |
| (1) Flor de María | 907 | Chumbivilcas | 05006521X01 | No 7078-95-RPM Dec 29, 1995 | 20001742 | |
| (2) Delia Esperanza |
1,000 | Chumbivilcas | 05006522X01 | No 0686-95-RPM Mar 31, 1995 | 20001743 | |
| (3) Julia Clara | 1,000 | Chumbivilcas | 05006523X01 | No 4600-95/RPM Sept 26, 1995 | 20001744 | |
| (4) El Pacífico I | 618 | Chumbivilcas | 05006536X01 | No 7077-95/RPM Dec 29, 1995 | 20001785 | |
| (5) El Pacífico II | 1,000 | Chumbivilcas | 05006524X01 | No 7886-94/RPM Nov 25, 1994 | 20001746 | |
| (6) Ferrum 14 | 268 | Chumbivilcas | 01-03047-05 | No 05032-2005-INACC/J Nov 30, 2005 | 11053842 |
Strike Resources / December 2012 Quarterly Report / 11
Cusco Project tenements
| Cusco Project tenements | Cusco Project tenements | Cusco Project tenements | Cusco Project tenements | Cusco Project tenements | Cusco Project tenements |
|---|---|---|---|---|---|
| Name | Area (Ha) | Province | Code | Title | File No. |
| (7) Ferrum 15 | 992 | Chumbivilcas | 10494906 | RJ 0753-2007-INACC/J Mar 05, 2007 | 11073796 |
| (8) Ferrum 17 | 500 | Chumbivilcas | 10026607 | RP 1815-2007-INGEMMET/PCD/PM Oct 30, 2007 | 11073794 |
| (9) Ferrum 18 | 800 | Chumbivilcas /Cotabambas |
10026707 | RP 1761-2008-INGEMMET/PCD/PM May 29, 2008 | 11076514 |
| (10) Ferrum 72 | 1,000 | Paruro | 10408208 | RP 4435-2008-INGEMMET/PCD/PM Oct 21, 2008 | 11084851 |
| (11) Ferrum 73 | 1,000 | Paruro | 10409608 | RP 5050-2008-INGEMMET/PCD/PM Nov 19, 2008 | 11084874 |
| (12) Ferrum 74 | 1,000 | Chumbivilcas/ Paruro |
10409708 | RP 5006-2008-INGEMMET/PCD/PM Nov 19, 2008 | 11084871 |
| (13) Ferrum 75 | 303 | Chumbivilcas | 10409808 | RP 5130-2008-INGEMMET/PCD/PM Nov 19, 2008 | 11084873 |
| (14) Ferrum 76 | 974 | Chumbivilcas | 10409908 | RP 4323-2008-INGEMMET/PCD/PM Oct 20, 2008 | 11084870 |
| (15) Ferrum 77 | 1,000 | Paruro | 10408108 | RP 5227-2008-INGEMMET/PCD/PM Nov 19, 2008 | 11084868 |
| (16) Ferrum 65 | 1,000 | Paruro | 10580008 | RP 0337-2009-INGEMMET/PCD/PM Feb 19, 2009 | 11093825 |
| (17) Ferrum 66 | 100 | Paruro | 10580208 | RP 1613-2009-INGEMMET/PCD/PM Jun 4, 2009 | 11093823 |
| (18) Ferrum 67 | 100 | Chumbivilcas | 10579908 | RP 5849-2008-INGEMMET/PCD/PM Dec 17, 2008 | 11084880 |
| (19) Ferrum 68 | 1,000 | Acomayo | 10579808 | RP 1185-2009-INGEMMET/PCD/PM Mar 31, 2009 | 11093824 |
| (20) Ferrum 69 | 1,000 | Acomayo | 10579708 | RP 1633-2009-INGEMMET/PCD/PM Jun 4, 2009 | TBA |
| (21) Ferrum 70 | 1,000 | Acomayo | 10579608 | RP 1848-2009-INGEMMET/PCD/PM Jun 11, 2009 | TBA |
| (22) Ferrum 71 | 1,000 | Acomayo | 10579508 | RP 1120-2009-INGEMMET/PCD/PM Mar 31, 2009 | TBA |
Paulsens East Project – Western Australia (Strike – 100%)
| Tenement No | Status | Grant Date | Expiry Date |
Area (blocks/Ha) |
Area(km²) |
|---|---|---|---|---|---|
| (1) EL 47/1328 | Granted | 05/10/06 | 04/10/13 | 6 blocks | 18 |
| (2) PL 47/1170* | Granted | 27/03/06 | 26/03/13 | 164 Ha | 1.64 |
- An application has been made to convert PL 47/1170 into mining lease M47/1437.
Strike Resources / December 2012 Quarterly Report / 12
==> picture [232 x 9] intentionally omitted <==
----- Start of picture text -----
Figure 2 – Sillaccassa ground magnetic survey results
----- End of picture text -----
==> picture [394 x 254] intentionally omitted <==
==> picture [394 x 255] intentionally omitted <==
Area Mag Mapped is the area of actual magnetite outcrop. Area Mag Inferred assumes that these outcrops are connected.
Strike Resources / December 2012 Quarterly Report / 13
Figure 3 – Colcabamba ground magnetic survey results
==> picture [457 x 589] intentionally omitted <==
Area Mag Mapped is the area of actual magnetite outcrop. Area Mag Inferred assumes that these outcrops are connected.
Strike Resources / December 2012 Quarterly Report / 14
Figure 4 – Bob 1 gravity anomalies and drill-hole locations
==> picture [456 x 590] intentionally omitted <==
Strike Resources / December 2012 Quarterly Report / 15
Figure 5 – Cerro Ccopane magnetic survey
==> picture [418 x 236] intentionally omitted <==
==> picture [418 x 236] intentionally omitted <==
Concession not held by Cuervo.
JORC Code Competent Person Statement
The information in this document that relates to exploration results and mineral resources has been compiled by Mr Ken Hellsten, B.Sc. (Geology), who is a consultant to Strike Resources Ltd and is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Hellsten has sufficient experience 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 Mineral Resources and Ore Reserves” (the JORC Code). Mr Hellsten consents to the inclusion in this document of the matters based on this information in the form and context in which it appears.
Strike Resources / December 2012 Quarterly Report / 16
Appendix 5B Mining Exploration Entity Quarterly Report
Name of entity
Strike Resources Limited and its controlled entities
ABN
94 088 488 724
Quarter ended 31 December 2012
Consolidated statement of cash flows
| Consolidated statement of cash flows | |
|---|---|
| Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) administration 1.3 Dividends received 1.4 Interest and other costs of finance paid 1.5 Income taxes paid 1.6 Other 1.7 Net Operating Cash Flows |
Current quarter Dec 2012 $’000 __ Year to date Dec 2012 (6 Months) $’000 _______ - - (711) (1,783) - - - - (25) (55) - - |
| (736) (1,838) |
|
| Cash flows related to investing activities 1.8 Payment for purchases of: (a) prospects (b) equity investments (c) other fixed assets 1.9 Proceeds from sale of: (a) prospects (b) equity investments (c) other fixed assets 1.10 Interest received 1.11 Loans to subsidiary entity(1) 1.12 Loan to other entities(2) 1.13 Payments for exploration and evaluation 1.14 Loans repaid by other entities 1.15 Investment in associate 1.16 Investment in listed entity 1.17 Other |
- - (3,190) (3,190) - - - - - - - - 219 565 (600) (1555) - - - - 2 (2) - - (121) (121) - - |
| Cash flows related to investing activities | (3,690) (4,303) |
| 1.18 Total operating and investing activities (carried forward) |
(4,426) (6,141) |
(1) Loans to subsidiary entity comprise loans made to Apurimac Ferrum S.A. ( AF ) pursuant to an executed Loan and Mortgage Agreement formalised by public deed dated 23 July 2009. These loans provide funding for the exploration and evaluation activities on iron ore projects located in Peru. On 28/12/12 Strike increased its shareholding from 50% to 100% effective interest in these projects through its shareholding in AF.
(2) Loans to other entities comprise a secured loan made to Cuervo Resources Inc.
Strike Resources / December 2012 Quarterly Report / 17
| Total operating and investing activities (brought forward) |
Current quarter Dec 2012 $’000 __ Year to date Dec 2012 (6 Months) $’000 _______ (4,426) (6,141) |
|---|---|
| Cash flows related to financing activities 1.19 Proceeds from issues of shares, options, etc. 1.20 Securities issue costs 1.21 Proceeds from sale of forfeited shares 1.22 Proceeds from borrowings 1.23 Repayment of borrowings 1.24 Dividends paid 1.25 Other |
- - - - - - - - - - - - - - |
| Net financing cash flows | - - |
| Net increase (decrease) in cash held 1.26 Cash at beginning of quarter/year to date 1.27 Exchange rate adjustments to item 1.22 1.28 Cash at end of quarter |
(4,426) (6,141) 18,834 20,552 4 1 |
| 14,412 14,412 |
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 | ||
|---|---|---|
| $’000 | ||
| 1.29 | Aggregate amount of payments to the parties included in item 1.2 | (138) |
| 1.30 | Aggregate amount of loans to the parties included in item 1.11 | - |
| 1.31 | Explanation necessary for an understanding of the transactions: |
Amounts disclosed at 1.29 represent director fees and superannuation payments to directors.
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:
-
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:
Refer 2.1 above
Strike Resources / December 2012 Quarterly Report / 18
Financing facilities available
| Amount available | Amount used | |||
|---|---|---|---|---|
| $’000 | $’000 | |||
| 3.1 | Loan facilities | - | - | |
| 3.2 | Credit standby arrangements | - | - |
Estimated cash outflows for next quarter
| Next Quarter | ||
|---|---|---|
| $’000 | ||
| 4.1 | Exploration and evaluation | - |
| 4.2 | Development | - |
| 4.3 | Loans to subsidiary * | 400 |
| 4.4 | Administration | 500 |
| Total | 900 |
Note:
- Loans to associate comprise loans to Apurimac Ferrum S.A. pursuant to an executed Loan and Mortgage Agreement formalised by public deed dated 23 July 2009. Strike Resources Ltd holds its interest in the Apurimac and Cusco iron ore projects locate in Peru through its shareholding in Apurimac Ferrum S.A.
Reconciliation of cash
| Consolidated | Consolidated | |
|---|---|---|
| Reconciliation of cash at the end of the quarter (as | Current quarter | Previous quarter |
| shown in the consolidated statement of cash flows) to the related items in the accounts is as follows. |
$’000 | $’000 |
| 5.1 Cash on hand and at bank |
4,976 | 1,398 |
| 5.2 Term Deposits |
9,436 | 17,436 |
| 5.3 Bank overdraft |
- | - |
| 5.4 Other |
- | - |
| Total cash at end ofquarter (item 1.23) | 14,412 | 18,834 |
Changes in interests in mining tenements
| 6.1 Interests in mining tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements acquired or increased |
Tenement reference | Nature of interest (note(2)) |
Interest at beginning of quarter |
Interest at end of quarter |
|---|---|---|---|---|
| All tenements listed under the_Peru_section of Mining Tenements, commencing on p9. |
50% | 100% |
Strike Resources / December 2012 Quarterly Report / 19
Issued and quoted securities at end of current quarter
| Total number |
Number quoted |
Issue price per security (see note 3) (cents) |
Amount paid up per security (see note 3) (cents) |
||
|---|---|---|---|---|---|
| 7.1 7.2 |
Preference securities | - | - | ||
| Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy-backs, |
2,800,000 - |
2,800,000 | $0.115 | Fully Paid | |
| 7.3 7.4 |
Ordinary securities Changes during quarter (a) Increases through issues (b) Decreases through returns of capital |
145,334,268 | 145,334,268 | ||
| - | - | ||||
| 7.5 7.6 |
Convertible debt securities Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted |
- | - | ||
| - - |
- - |
||||
| 7.7 7.8 7.9 7.10 |
Options (all unlisted) Employee options Director options Director options Director options Employee options Employee options Employee options Issued during quarter Director options Employee options Exercised during quarter Expired during quarter Director options Director options Director options Director options |
250,000 500,000 500,000 500,000 916,666 916,666 916,668 |
- | Exercise price 287.8 cents 36.0 cents 42.0 cents 56.0 cents 36.0 cents 42.0 cents 56.0 cents |
Expiry date 3 March 2013 23 November 2016 23 November 2016 23 November 2016 23 November 2016 23 November 2016 23 November 2016 |
| - - |
|||||
| - | |||||
| 750,000 750,000 750,000 3,500,000 |
- | 250.0 cents 275.0 cents 325.0 cents 397.8 cents |
24 November 2012 24 November 2012 24 November 2012 2 December 2012 |
||
| 7.11 | Debentures (totals only) | - | |||
| 7.12 | Unsecured notes | - |
Strike Resources / December 2012 Quarterly Report / 20
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 Stephen J. Gethin Date: 31 January 2013 Company Secretary
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 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report.
-
5) Accounting Standards ASX will accept, for example, the use of International Financial Reporting 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.
Cash Flow Notes
-
a) The Company holds foreign currencies denominated in US dollars, Peruvian Nuevo Soles and Indonesian Rupiah. Fluctuations in foreign exchange rates have been accounted for in this cashflow report using the exchange rates as at balance date.
-
b) The definitions in, and provisions of AASB 1026: Statement of Cash Flows apply to this report.
Strike Resources / December 2012 Quarterly Report / 21