DECEMBER 2015 QUARTERLY REPORT 19 January 2016

Transcription

1 DECEMBER 2015 QUARTERLY REPORT 19 January 2016 LEGEND MINING LIMITED ASX Symbol: LEG ABN Level 1, 8 Kings Park Road West Perth Western Australia 6005 PO Box 626 West Perth Western Australia 6872 Phone: Facsimile: legend@legendmining.com.au Website: CONTACT Mr Mark Wilson Managing Director Mr Derek Waterfield Executive Director Technical PROJECTS Rockford Fraser Range: NickelCopper, Gold HIGHLIGHTS Extensive ground EM programme completed over six target areas at Rockford Project, Fraser Range Five conductors identified at Area D, with three conductors having very high conductivities of 9,00017,000S associated with large relatively shallow bedrock features Two further conductors identified at Areas E & F OVERVIEW Following the settlement of the 70% purchase of the Rockford Project tenements from the Creasy Group on 23 September 2015, Legend conducted the first full quarter of exploration consisting of data interpretation and ground EM surveying. The ground EM programmes were rewarded with seven conductors in three separate locations. Three of the conductors have very high conductivities and are relatively shallow. This will mean that the cost of RC drill testing these features will be at the modest end of the cost scale. The RC programme is a priority activity for the current quarter and will be complimented by completing the ground EM programmes (which were interrupted by the Christmas break) and later regional aircore drilling of circa 10,000m. Full details of the work completed are summarised in the body of this report and once new RC and aircore programmes are finalised details will be released to ASX. DECEMBER 2015 QUARTERLY REPORT Page 1

2 1. ROCKFORD PROJECT (Fraser Range District) NickelCopper, Gold The Rockford Project covering 2,939km 2 comprises eight contiguous granted exploration licences located in the highly prospective Fraser Range district of Western Australia (Figure 1). A large portion of the Project (2,530km 2 ) is the subject of a joint venture between Legend (70%) and Creasy Group (30%), with Legend operator and manager of the joint venture, (see LEG:ASX announcement 2 July 2015). The project covers a strike length of 100km over a regional gravity high ridge associated with dense mafic/ultramafic intrusive rocks of the Fraser Zone, within the larger AlbanyFraser Orogen. The NovaBollinger deposit, which lies within the Fraser Zone, is situated on a similar tenor gravity ridge to that of the Rockford Project, see Figure 1. During the quarter, Legend undertook extensive moving loop electromagnetic ( MLEM ) surveying over six target areas (Areas A Central, B, C, D, E & F), comprising 82 traverses, 1,978 stations and covering line km, see Figure 1. Figure 1: Rockford Project Target Areas on Regional Gravity DECEMBER 2015 QUARTERLY REPORT Page 2

3 The results from the MLEM surveying are considered highly encouraging with the identification of five conductors at Area D and single conductors at both Area E and Area F. Descriptions of the conductors from these three areas are provided below. Area D Area D has a discrete 1.5km x 1km gravity high (4mgal) with an associated magnetic signature suggestive of a structural fold closure or intrusive feature. A total of 11 high powered (~200amp) MLEM lines spaced 150/300m apart were completed, identifying five highly to moderate conductive bedrock conductors at relatively shallow depth. Figure 2 shows the location of the five conductors with respect to the discrete gravity high, with a summary provided in Table 1 below. Figure 2: Area D Conductor Plates on Residual Gravity Image Table 1: Area D Conductor Description Conductor Conductance Dimensions Depth to Top Plate Orientation 1 ~11,000S 800m x 800m+ ~100m 80 deg. NW dip 2 ~17,000S 800m x 800m+ ~200m 7580 deg. N dip 3 ~9,000S 800m x 800m+ ~100m 7580 deg. NW dip 4 ~1,000S 300m x 200m ~100m 85 deg. NW dip 5 ~5,000S +1,000m x 1,000m ~250300m 85 deg. NW dip DECEMBER 2015 QUARTERLY REPORT Page 3

4 Conductors 1, 2 and 3 all had very high conductance levels which required infill lines utilising lower base frequencies (originally 1 Hz down to 0.5Hz & 0.125Hz) to better define the conductors and allow accurate modelling. These conductors represent highly conductive bedrock sources and are situated on the SE margin of the gravity high and appear related to local aeromagnetic units. Maxwell modelling has characterised these three conductors as being of large areal size/extent (>800x800m), striking ENEWSW, having steep N/NW dips ( ) and an estimated depth to top of source of m. Conductance levels are very high at ~9,00017,000S and consistent with the signature of a welldeveloped sulphidic/graphitic body. Conductor 4 represents a moderate strength, localised (~300x200m) conductor located within the central zone of the gravity high. Moderate conductance levels of ~1,000S were apparent from modelling, with the associated source having an estimated depth to top of source of 100m, orientated NESW and dipping steeply NW at ~85 0. Conductor 5 is a strong and deeper level bedrock conductor defined along the western margin of the gravity high. Further definition of this target is required, however the associated conductive source/s are situated at >250m depth to top and do not demonstrate any clear correlation with the gravity and aeromagnetic data. The highly conductive character of Conductors 13 and the location of Conductor 4 with respect to the gravity feature make these conductors compelling RC drill targets. Area E Area E has a discrete 1.5km x 1.3km residual gravity high with associated strong magnetic response representing a complex fold closure, see Figure 3. A major NW trending cross structure is also interpreted to bound the gravity feature to the northeast and north. Modelling of the MLEM data identified a large >1,500m x 1,500m late channel bedrock conductor with low conductance (~250500S), an estimated depth to top of source of >600m and is near flat lying (summarised in Table 2). This is a low priority feature, however further modelling is required to better define its parameters and determine whether it warrants drill testing. Area F Area F has an elongate ENE trending residual gravity high in the west and a more subtle gravity trend in the east, see Figure 3. The aeromagnetics indicates a large open Zparasitic fold and a regional scale NW trending cross structure. The MLEM survey identified a NE trending moderate bedrock conductor situated on the flank of the subtle eastern gravity trend. Modelling of the conductor indicates a depth to top of source of <125m, a steep NW dip of , a moderate conductance of ~1,2502,000S+ and a plate with dimensions of ~800m x 800m+ (summarised in Table 2). RC drill testing of this feature is required to determine the source of the conductor. DECEMBER 2015 QUARTERLY REPORT Page 4

5 Figure 3: Areas E & F Conductor Plates on Residual Gravity Image Table 2: Areas E & F Conductor Description Conductor Conductance Dimensions Depth to Top Plate Orientation Area E ~250500S >1,500m x 1,500m >600m Near flat lying Area F ~1,2502,000S+ ~800m x 800m+ <125m N dip Future Programmes MLEM surveying will recommence in late January to complete untested targets from the 2015 programme, i.e. Areas A North and South. RC drill testing of four conductors at Area D and one at Area F is planned for late February/March. A +10,000m aircore programme is planned to commence next quarter, aimed at providing valuable geological and geochemical information and assisting with the prioritisation of areas for further work. Further details of the drilling programmes will be released once final planning and logistics are complete. DECEMBER 2015 QUARTERLY REPORT Page 5

6 MLEM Survey Background OuterRim Exploration Services Pty Ltd were commissioned by Legend in late September to undertake high powered (~200amp) moving loop electromagnetic surveying over the Rockford Project. This surveying is part of a research and development programme designed to develop and advance current EM methods, aimed at identifying conductors associated with massive sulphide (i.e. NovaBollinger type) beneath extensive transported/conductive cover. Survey Specifications: Loop Size: 200m x 200m, single turn Line/Station Spacing: 300m spaced lines with 100m stations Transmitter: ORE HPTX ( amps) Receiver: EMIT SMARTem24 Sensor: EMIT Fluxgate 3 component B field sensor Time base/frequency: Hz (2502,000msec time base), ~0.475msec ramp 2. CORPORATE Cameroon Project Legend received the first quarterly interest payment of $30,000 on 16 December 2015 from Jindal Steel and Power, as per the rescheduled debt agreement announced to the ASX on 28 July Competent Person Statement The information in this report that relates to Exploration Results is based on information compiled by Mr Derek Waterfield, a Member of the Australian Institute of Geoscientists and a full time employee of Legend Mining Limited. Mr Waterfield has sufficient experience that is relevant to the styles of mineralisation and types of deposit under consideration, and to the activity being undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code). Mr Waterfield consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Visit for further information and announcements. For more information: Mr Mark Wilson Mr Derek Waterfield Managing Director Executive Director Technical Ph: (08) Ph: (08) DECEMBER 2015 QUARTERLY REPORT Page 6

7 Mining Tenements Tenement Location Reference Appendix 1: Tenement Schedule as at 31 December 2015 Interest at beginning of Quarter Acquired / Disposed Interest at end of Quarter Comments E28/1718 Fraser Range, Western Australia 70% N/A 70% 70:30 JV E28/1727 Fraser Range, Western Australia 70% N/A 70% 70:30 JV E28/2188 Fraser Range, Western Australia 70% N/A 70% 70:30 JV E28/2189 Fraser Range, Western Australia 70% N/A 70% 70:30 JV E28/2190 Fraser Range, Western Australia 70% N/A 70% 70:30 JV E28/2191 Fraser Range, Western Australia 70% N/A 70% 70:30 JV E28/2192 Fraser Range, Western Australia 70% N/A 70% 70:30 JV E28/2342 Fraser Range, Western Australia 100% N/A 100% Granted ELA28/2408 Fraser Range, Western Australia 100% N/A 100% Application ELA28/2415 Fraser Range, Western Australia 100% N/A 100% Application FarmIn or FarmOut Arrangements Tenement Location Reference Interest at beginning of Quarter Acquired / Disposed Interest at end of Quarter None N/A N/A N/A N/A N/A Comments Appendix 2: Legend Mining Limited Rockford Project JORC Code Edition 2012: Table 1 Section 1: Sampling Techniques and Data Criteria Commentary Sampling techniques Not applicable, as no geochemical sampling or drilling was Drilling techniques undertaken or referred to in the report. Drill sample recovery Logging Subsampling techniques and sample preparation Quality of assay data and laboratory tests Verification of sampling and assaying Location of data points Data spacing and distribution Orientation of data in relation to geological structure Sample security Audits or reviews DECEMBER 2015 QUARTERLY REPORT Page 7

8 Section 2: Reporting of Exploration Results Criteria Commentary Mineral tenement and The Rockford Project comprises eight granted tenements; land tenure status E28/2342 (100% Legend), E28/ (70% Legend, 30% Rockford Minerals Pty Ltd JV), E28/1718 & E28/1727 (70% Legend, 30% Ponton Minerals Pty Ltd JV). The Project is located 280km east of Kalgoorlie on vacant crown land. There are no Native Title Claims over tenements E28/2342, E28/ Tenements E28/1718 & E28/1727 are covered 90% and 20% respectively by the Ngadju Native Title Claim. Exploration done by Not applicable, not referred to. other parties Geology The primary target is Nova style nickelcopper mineralisation hosted in high grade mafic granulites within the Fraser Complex. A secondary target is Tropicana style structurally controlled gold mineralisation. Drill hole Not applicable, not referred to. Information Data aggregation Not applicable, not referred to. methods Relationship between Not applicable, not referred to. mineralisation widths and intercept lengths Diagrams Project location and ground EM anomaly maps have been included in the body of the report. Balanced reporting Not applicable, not referred to. Other substantive exploration data Further work OuterRim Exploration Services Pty Ltd have undertaken high powered moving loop electromagnetic surveying over the Rockford Project. Loop Size: 200m x 200m, single turn Line/Station Spacing: 300m spaced lines with 100m stations Transmitter: ORE HPTX ( amps) Receiver: EMIT SMARTem24 Sensor: EMIT Fluxgate 3 component B field sensor Time base/frequency: Hz (2502,000msec time base), ~0.475msec ramp RC drilling testing of conductors at Areas D & F is planned. DECEMBER 2015 QUARTERLY REPORT Page 8

9 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report Appendix 5B Rule 5.5 Mining exploration entity and oil and gas exploration entity quarterly report Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/2013 Name of entity Legend Mining Limited ABN Quarter ended ( current quarter ) December 2015 Consolidated statement of cash flows Cash flows related to operating activities Current quarter Year to date (12 months) 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration & evaluation (b) development (c) production (d) administration (878) (302) (1,317) (1,272) 1.3 Dividends received Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes refunded/(paid) 1.7 Other (provide details if material) 91 Net Operating Cash Flows (1,074) (2,248) 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 (10) (2,500) (1,979) (10) 3, Loans to other entities 1.11 Loans repaid by other entities 1.12 Other (provide details if material) Proceeds on sale of subsidiaries that held the Cameroon project 3,000 Net investing cash flows (10) 1, Total operating and investing cash flows (carried forward) (1,084) (686) + See chapter 19 for defined terms. 01/05/2013 Appendix 5B Page 1

10 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report 1.13 Total operating and investing cash flows (brought forward) (1,084) (686) Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other (provide details if material) Net financing cash flows Net increase (decrease) in cash held (1,084) (686) 1.20 Cash at beginning of quarter/year to date 7,335 6, Exchange rate adjustments to item Cash at end of quarter 6,251* # 6,251* # * Excludes value of investments at cost of $2,458,000 (market value 15 January 2016 $2,425,650). # Does not include $3M receivable due in December Payments to directors of the entity, associates of the directors, related entities of the entity and associates of the related entities Current quarter $A' Aggregate amount of payments to the parties included in item Aggregate amount of loans to the parties included in item Explanation necessary for an understanding of the transactions Item 1.23 includes aggregate amounts paid to directors including salary, directors fees, consulting fees and superannuation. Noncash 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 N/A 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 N/A Financing facilities available Add notes as necessary for an understanding of the position. Amount available Amount used 3.1 Loan facilities Nil Nil 3.2 Credit standby arrangements Nil Nil + See chapter 19 for defined terms. Appendix 5B Page 2 01/05/2013

11 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report Estimated cash outflows for next quarter 4.1 Exploration and evaluation Development 4.3 Production 4.4 Administration 300 Total 1,100 Reconciliation of cash Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows. Current quarter Previous quarter 5.1 Cash on hand and at bank 251 1, Deposits at call 6,000 6, Bank overdraft 5.4 Other (provide details) Total: cash at end of quarter (item 1.22) 6,251 7,335 Shares held in Artemis Resources Limited, Nemex Resources Limited, Independence Group NL and S2 Resources Limited at cost Total: cash, security deposits and other liquid assets held at cost at end of quarter 2,458 2,458 8,709 9,793 Changes in interests in mining tenements and petroleum tenements 6.1 Interests in mining tenements and petroleum tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements and petroleum tenements acquired or increased Tenement reference and location Nature of interest (note (2)) Interest at beginning of quarter Interest at end of quarter + See chapter 19 for defined terms. 01/05/2013 Appendix 5B Page 3

12 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report Issued and quoted securities at end of current quarter Description includes rate of interest and any redemption or conversion rights together with prices and dates. 7.1 Preference + securities (description) 7.2 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buybacks, redemptions Ordinary securities Total number Number quoted 2,034,350,801 1,962,850,801 Issue price per security (see note 3) (cents) Amount paid up per security (see note 3) (cents) 7.4 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buybacks Convertible debt securities (description) 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted 7.7 Options (description and conversion factor) 7.8 Issued during quarter 150,000,000 Exercise price 4.0 cents Expiry date 23 September Exercised during quarter 7.10 Expired/cancelled during quarter 7.11 Debentures (totals only) 7.12 Unsecured notes (totals only) 30,000, cents 21 December See chapter 19 for defined terms. Appendix 5B Page 4 01/05/2013

13 Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report 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 /does not* (delete one) give a true and fair view of the matters disclosed. Sign here: Date: 19 January 2016 (Company secretary) Print name: Dennis Wilkins 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 and petroleum 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 or petroleum tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 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. == == == == == + See chapter 19 for defined terms. 01/05/2013 Appendix 5B Page 5