For the month ending 30 September 2012
-- Lithium carbonate production increases at Jiangsu
-- Excellent quality performance with lithium carbonate achieving
-- Jiangsu on track to be cash flow positive in Q1, 2013
-- Sales Revenue of A$3.7 million (inclusive of VAT) commences for
-- Development strategy and rationale for Sal De Vida outlined
-- Sal de Vida DFS progressed
-- Sal de Vida Environmental Impact Statement submitted
-- Successful brine pump testing completed at Sal de Vida
-- Working capital loan to China Construction Bank successfully
-- Sales of battery grade lithium carbonate from Jiangsu Plant
/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION
IN THE UNITED STATES/
PERTH, Australia, Oct. 31, 2012 /CNW Telbec/ - Galaxy Resources Ltd ("Galaxy")
is an Australian-based global lithium company with lithium production
facilities, hard rock mines and brine assets in Australia, China, Canada and
Argentina. The Company is an integrated lithium mining, chemicals and battery
company listed on the Australian Securities Exchange (Code: GXY) and is a
member of the S&P/ASX 300 Index.
Galaxy wholly owns the Mt Cattlin project near Ravensthorpe in Western
Australia where it mines lithium pegmatite ore and processes it on site to
produce a spodumene concentrate and tantalum by-product. At full capacity,
Galaxy will process 137,000 tpa of spodumene concentrate which will feed the
Company's wholly-owned Jiangsu Lithium Carbonate Plant in China's Jiangsu
province. The Jiangsu Plant has commenced production and will produce 17,000
tpa of battery grade lithium carbonate, the largest producer in the Asia
Pacific region and the fourth largest in the world.
Galaxy is also advancing plans to develop the Sal de Vida (70%) lithium and
potash brine project in Argentina situated in the lithium triangle (where
Chile, Argentina and Bolivia meet) which is currently the source of 60% of
global lithium production. Sal de Vida has excellent promise as a future low
cost brine mine and lithium carbonate processing facility.
Lithium compounds are used in the manufacture of ceramics, glass, electronics
and are an essential cathode material for long life lithium-ion batteries used
to power e-bikes and hybrid and electric vehicles. Galaxy is bullish about the
global lithium demand outlook and is positioning itself to achieve its goal of
being involved in every step of the lithium supply chain.
Development Strategy and Rationale for Sal de Vida
During the Quarter, the Company outlined the development strategy for its Sal
de Vida lithium and potash brine project ("Sal de Vida") in Argentina. Galaxy
acquired a 70% stake in the highly prospective Sal de Vida project following
its merger with Lithium One Inc. Sal de Vida offers Galaxy geographical,
process and cost base diversification from its existing assets in Australia
and China. Its favourable brine chemistry and prime location mean it is
expected to become Galaxy's next flagship asset.
Galaxy's plans for Sal de Vida include development of evaporation ponds and a
battery grade lithium carbonate plant. The Company's preference is to advance
Sal de Vida's development to be prepared ahead of anticipated spikes in demand
for lithium carbonate, as demand for lithium-ion batteries for electronics,
electric vehicles and battery storage grows.
The lithium battery sector continues to be consumer driven and, in the last
few years, has experienced consistent growth of around 20-25% per annum. The
utilisation of lithium-ion batteries continues to grow and, significantly, the
size of lithium-ion batteries is also increasing to fit larger electric
vehicles and energy storage units. For example, the amount of lithium
carbonate in one electric car is in the region of 3,000 times more than that
of a laptop lithium-ion battery.
While lithium carbonate prices are already increasing, Galaxy forecasts
exponential growth (a 'hockey stick' growth profile) in lithium demand in the
next five years, driven by the lithium-ion battery sector. The lithium battery
industry today is worth US$11 billion and expected to grow to US$43 billion by
2020. Consequently, lithium carbonate feedstock demand is also expected to
increase 2-3 times by the end of the current decade.
Galaxy also recognises that development lead times on lithium mines and
projects can be in the vicinity of 4-5 years. Galaxy therefore needs to
advance the development of Sal de Vida to be positioned and ready for the
anticipated demand growth. This timeframe would allow Galaxy to fully benefit
from the potential demand and lock in long term off take contracts.
Galaxy believes that those lithium companies with operating projects in place
in anticipation of this potential demand will be in the best position to
Galaxy sees very strong growth ahead in the lithium sector and wants to
develop Sal de Vida in anticipation of that forecast demand. The Company's
diversification strategy has been to acquire and develop both hard rock and
brine lithium operating assets in various geographies. The proposed
acquisition of Talison Lithium (a hard rock concentrate producer) by Rockwood
Lithium (a brine based lithium chemical producer) for C$724 million vindicates
Galaxy's strategy and its view of the long term growth in this market.
The development of Sal de Vida would give Galaxy a presence in three
continents - Australia, Asia and South America and see it establish itself as
a global miner and producer of lithium products. Through the Company's Jiangsu
Lithium Carbonate Plant ("Jiangsu"), Galaxy is already set to become the
largest producer of battery grade lithium carbonate in the Asia Pacific region
once it reaches design capacity.
In addition, Galaxy has representation in the world's top three lithium
battery producing countries - China, Japan and Korea. Galaxy's global partners
include the top 13 cathode producers in China, Mitsubishi Corporation (Japan),
Korean Resources Corporation (Korea), LG International (Korea) and GS Caltex
Although the company is progressing early-stage plans at Sal de Vida, the
Board has resolved not to make a final investment decision for full scale
commitment to Sal de Vida until the Jiangsu Plant achieves positive cash flow
on a sustainable basis.
Sal de Vida
Flag Ship Asset
Galaxy spent a number of years looking for a high quality, undeveloped lithium
brine project with the aim of adding extra lithium resources and lithium
carbonate capabilities to its asset portfolio in anticipation of growing
lithium demand. Sal de Vida's potential production profile is 25,000 tpa of
battery grade lithium carbonate and 107,000 tpa of potash (KCl) by-product for
the fertiliser industry. In addition to the 17,000 tpa design capacity of
Jiangsu, Galaxy would produce 42,000 tonnes of lithium carbonate per annum
from 2016 onwards.
The Sal de Vida brine chemistry is highly favourable, with high levels of
lithium and potash, and low levels of magnesium and sulphate impurities. Sal
de Vida is situated in the renowned 'lithium triangle' at the meeting point of
Argentina, Chile and Bolivia. It is located adjacent to FMC Lithium's El Fenix
lithium operation in the Salar del Hombre Muerto, which has been in operation
for the last 15 years.
The Sal de Vida Pre-Feasibility Study ("PFS") completed in October 2011
estimated a net present value for the project of US$1.07 billion. The average
operating cost was estimated at US$1,537 per tonne of finished lithium
carbonate, generating a net pre-tax cash flow of US$139 million per annum.
Galaxy is completing a Definitive Feasibility Study ("DFS") on the Sal de Vida
project and is expected to complete the study in Q1 2013.
During the Quarter, Galaxy announced that the initial repayment of the
Company's working capital loan to China Construction Bank Limited ("CCB") had
been successfully re-financed to September 2013. Galaxy had previously stated
that it was in the process of negotiating with CCB to refinance the repayment
in its condensed consolidated interim financial reports for the quarter and
half year ended 30 June 2012. The first repayment of A$9.4 million (RMB 60
million) is now due in September 2013.
Safety & Environment
There were two lost time injuries recorded for the group during the Quarter.
The LTIs involved minor injuries - one in Argentina and another in China.
There were no environmental incidents recorded for the Quarter.
Sal de Vida Project
The Sal de Vida DFS continues to progress well and is expected to be completed
in Q1 2013.
Argentinean engineering firm TAGING S.A. ("TAGING"), which specialises in
Argentinian mining projects with extensive experience in lithium brine
projects, has been appointed to complete the DFS. International engineering
company Hatch Ltd ("Hatch") is providing specialist process input for Galaxy
during the DFS process. Hatch was the designer and EPCM contractor for the
Jiangsu Plant and also has extensive lithium brine and operational experience
in South America.
A number of lithium experts to bolster the existing Sal de Vida project team
were appointed during the Quarter. Most notable is the appointment of lithium
industry veteran Dr Vijay Mehta as Senior Technical Advisor. Dr Mehta has 45+
years of experience in brine based lithium processing technology, including 30
years at FMC Lithium, where he developed the lithium plant at FMC's Hombre
Muerto Salar project, which adjoins Sal de Vida.
Key Technical Team includes Dr Vijay Mehta - Senior Technical Advisor, Jerome
Lukes - Senior Technical Engineer, David Butts - Pond Operation & Design, Dr
Greg Sheehan - Process Operation and Design, Dr Jingyuan Liu - GM Business
Readiness. Key Project Management includes Iain Scarr - General Manager
Argentina, Terry Stark - Project Director, Ernest Burga - Engineering Project
Environmental Impact Statement
The Environmental and Social Impact Statement ("EIS") for Sal de Vida was
submitted to the Provincial Environmental Agencies of Salta and Catamarca as
the Project straddles both provincial boundaries. The EIS has provided
assessment of the potential environmental impacts of the Project. The Project
involves construction of evaporation ponds over a 20 square kilometre area in
the northern basin of the salt pan. The core part of the Project includes a
lithium carbonate precipitation and purification plant producing battery grade
lithium carbonate. A separate potash plant producing fertiliser grade potash
(potassium chloride) is also planned.
Successful Brine Pump Testing
The Company successfully completed a long term pumping test on the first
proposed production well at Sal de Vida. The successful test involved
pumping brine from the production well at a constant rate and without faults
or blockages, over a 30 day period. The pumping of the brine to solar ponds is
a critical part of a lithium brine operation. Once the brine evaporates,
concentrated lithium brine is harvested and further processed into lithium
carbonate.The pump test results will be used to demonstrate capability for
the long term supply of brine and lithium concentrate to the lithium carbonate
plant Galaxy plans to build on the Sal de Vida site.
The initial well at Sal de Vida is demonstrates the potential for long term
supply to proposed solar ponds and lithium carbonate and potash production
plants, utilising only a fraction of the currently estimated extractable
resource. The tested well was set at a depth of 53 metres and pumped brine
to the solar ponds at a rate of 16 litres per second. The maximum drawdown at
the pumped well was less than 7 metres at end of the test period. The average
lithium content of pumped water was approximately 760 milligrams per litre
(mg/L); average potassium content was approximately 8800 mg/L reflecting the
reserve grades. The brine composition did not change appreciably throughout
Definitive Feasibility Study
Fresh water exploration has commenced with several fresh water exploration
wells being drilled at Los Patos River delta. The Boron solvent extraction
test work is progressing well with excellent efficiency being achieved from
the brine. Boron is an impurity in the brine which has to be removed prior to
lithium carbonate precipitation. Similar calcium and magnesium removal test
work has also been completed and is demonstrating good results. Potash
flotation testing conducted in Canada has also demonstrated
higher-than-expected recoveries and supports the assumptions in the definitive
Engineering is progressing well with final process flow diagrams generated in
preparation for the procurement packages. The valuable learnings from the
Company's Jiangsu operation have been incorporated including the purification
technology. The purification technology is used to upgrade lithium carbonate's
purity to 'battery grade' (99.5% purity, or above) meaning it can be used by
battery cathode producers for the manufacture of lithium-ion batteries.
Because of its high value application, battery grade lithium carbonate
receives a significant price premium to more common technical grades.
Galaxy developed and patented the purification technology in 2010 and has
successfully proven the technology at its wholly-owned Jiangsu Plant in China.
Jiangsu's lithium carbonate met all battery grade specifications in July 2012
and initial sales of battery grade lithium carbonate commenced during the
Galaxy plans to develop a battery grade lithium carbonate plant at the Sal de
Vida site, which will mirror the purification plant design at Jiangsu.
Galaxy's purification technology is designed to be applied to either hard rock
or brine based lithium carbonate production processes. The DFS currently
underway on Sal de Vida will incorporate utilisation of the purification
technology in its flow sheet.
Galaxy's technology will enable it to become the first lithium company in
South America to produce battery grade lithium carbonate directly from a brine
salar site. Currently, South American brine lithium producers have to upgrade
their lithium carbonate to battery grade standard by sending the product off
site or overseas.
Appointment of Sal de Vida Site Director
Subsequent to the Quarter, the Company appointed Mr Daniel Chavez Diaz as Site
Director of Sal de Vida Project in Argentina. Mr Chavez Diaz is a chemical
engineer and highly experienced management executive who has spent the last 20
years working for lithium giant FMC Corporation ("FMC"). Since 2007, Mr Chavez
Diaz has been President of FMC subsidiary Minera del Altiplano S.A., and has
been responsible for overseeing FMC's lithium production facilities in
Mr Chavez Diaz has also been General Manager of FMC's El Fenix lithium
operation in the Salar del Hombre Muerto. El Fenix includes evaporation ponds,
lithium chloride and carbonate plants and shares the same salar (salt pan) as
Sal de Vida. Other previous management roles at El Fenix include Operations
Director, Plant Manager and Production Manager. He holds a chemical
engineering degree from Universidad Nacional de Salta, an Executive Master of
Business Administration degree, and is currently the President of Unión
Industrial de Salta.
Mr Chavez Diaz will lead the Sal de Vida team in developing Galaxy's planned
lithium brine operation and lithium carbonate plant. Galaxy is very pleased to
have secured someone with Mr Chavez Diaz's lithium industry experience and,
most importantly, in-country experience. Mr Chavez Diaz has many years of
experience liaising with provincial and federal authorities, as well as
establishing and operating businesses in Argentina. He is a noteworthy
addition to the Sal de Vida team.
Mt Cattlin - Operations
The Galaxy Board reached a decision to temporarily halt production at the Mt
Cattlin Operation from the end of July 2012. The combination of Mt Cattlin's
recent strong performance, coupled with the Jiangsu Plant being in a 12-month
ramp-up phase, resulted in a build-up of internal spodumene inventory levels
of approximately 12 months' supply of feedstock ahead of the Jiangsu Plant.
The plan remains to pause production until stockpiles for the Jiangsu Plant
have been reduced to about 2-3 months' supply. The suspension of spodumene
production will not affect the company's revenue as it begins to sell the
value-added lithium carbonate product from the Jiangsu Plant.
All Galaxy's Mt Cattlin Operation employees have been retained and will
concentrate on process upgrade projects and maintenance activities to enable
re-start of the operation once spodumene inventory levels are re-balanced.
Mining contractor, Orionstone and subcontractor TDS were successfully
demobilised from site during July and early August, the whole process being
undertaken in a professional and incident free manner.
A total of 35,274 tonnes of spodumene product was shipped to the Jiangsu
Lithium Carbonate Plant in China and 86 tonnes of tantalite concentrate was
sold to Global Advanced Metals during the September Quarter.
|Mt Cattlin | Sep 2012| 2012|
| | | |
|Production Statistics | Quarter| YTD|
|Ore Mined (Tonnes) | 35,284| 454,912|
|Grade (Li(2)O%) | 1.42| 1.22|
|Waste Mined (BCM) | 84,250| 925,505|
|Ore Treated (Tonnes) | 43,107| 453,004|
|Grade (Li(2)O%) | 1.34| 1.23|
|Spodumene Produced | 5,382| 54,047|
|(dry Tonnes) | | |
Mt Cattlin continues to provide feedback to the community regarding the
Company's progress on site through quarterly meetings, and through the local
community newsletter, and is actively involved with organised community and
charity events. Positive feedback has been received from the community, and
from affected contract employees, regarding the assistance packages provided
by the Company to assist with the relocation of contract employees, during the
temporary halt to operations at Mt Cattlin.
Jiangsu - Operations
The Company's Jiangsu lithium carbonate operations progressed its 12 month
ramp-up phase during the Quarter with overall production of 599 tonnes over
the period. Production met sales demand for the Quarter determined by the
customer product qualification ramp-up profile. Total sales for the Quarter
were 586 tonnes, recording revenue of RMB 23.4 million (inclusive of VAT)
Quality performance has been excellent with the Jiangsu Plant achieving
battery grade quality across all specifications, meeting the Plant's design.
This means that as well as adhering to the 99.5% purity criteria, the
production met the prescribed tolerances for impurities required by Galaxy's
cathode producing customers.
| | Sep 2012| 2012|
|Jiangsu Production Statistics| | |
| | Quarter| YTD|
|Total LC Production | 599| 752|
The focus during the Quarter has been to improve the stability, on line rate
and utilisation of the back end of the Plant. Improvements to the belt
filtration operation were achieved with the design two belt filters on line
and much improved water balance and total dissolved solid levels in the waste
Process improvement changes were made in the precipitation and purification
areas to improve scaling and operational issues. Some tank rubber liners were
replaced to improve product quality and process operability. A new pneumatic
conveying system to replace the current drag chain conveyors was installed
during the Quarter which has improved both the quality performance and
operability of the product end of the Plant.
Sodium sulphate by-product is now achieving good quality and is sold to the
textile and detergent industry. Slag sales also continued during the Quarter.
Sales & Marketing
Total sales during the Quarter were 586 tonnes of both technical and battery
grade product. The sales strategy for the ramp-up of the Jiangsu Plant
centered around selling mainly technical grade product until the battery grade
product could be qualifiied.
The battery grade lithium carbonate qualification process continued with
potential battery cathode customers. Production samples have now been sent to
over 50 potential customers in China for the product testing and qualification
process. As part of the vigorous qualification process, the whole upstream
chain and customers, including the final lithium battery customers, are
involved in the qualification acceptance process.
Feedback from the market has been extremely positive so far. The majority of
samples have so far passed the first stage testing process, and potential
customers have commenced taking either larger test samples or commenced trail
supply. Late in the Quarter, sales of battery grade product commenced, with 46
tonnes sold to lithium cathode customers.
* Specific details regarding pricing, sales volume, product split and cost
structure is subject to confidentiality obligations of sales contracts and
Production quality continues to be good adhering to the 99.5% purity criteria
and meeting the prescribed tolerances for impurities required by its cathode
producing customers. Achieving product quality design and production output at
a complex chemical plant often takes considerable time however the progress
made in the Quarter and to date has exceeded the Company's expectations.
The quality of the battery grade lithium carbonate is on par with Galaxy's
major competitors in China, and better than its competitors in some of the
impurity levels like Sodium (Na), Magnesium (Mg) and Sulphates (SO4). The
table below shows the comparative analyses of some of the major suppliers of
Impurity levels (ppm)
Competitor Na K Ca Mg Fe Al Cu Mn
Ni Zn Pb Si SO4 Cl
PRC 1 200 5 10 30 2 16 1 1
1 1 1 28 800 10
PRC 2 180 10 25 35 8 1 1 1
1 3 1 8 830 12
Sth Am 1 570 29 94 83 5 9 1 1
1 1 1 110 240 92
Sth Am 2 260 10 70 50 2 7 1 1
1 1 1 800 60
Galaxy 20 5 28 5 6 5 1 1
1 2 1 10 480 10
Specs ≤250 ≤10 ≤50 ≤100 ≤20 ≤50 ≤10 ≤10 ≤30 ≤10 ≤10 ≤50 ≤800
Lithium demand in the first half of the year remained robust and the supply
and demand relatively balanced. The main demand was from the battery segment.
Chinese demand in H1 2012 was approximately 10% higher than same period last
year and the forecast for the balance of the year is considered to be higher.
Prices for both technical and battery grade lithium carbonate in China have
risen significantly on the back of tight demand and supply fundamentals.
Chinese lithium carbonate producers lifted domestic lithium carbonate prices
during the Quarter and the uncontracted spot price for battery grade lithium
carbonate in China hit levels of up to RMB 45,000/tonne (inclusive of VAT) or
approximately US$ 7,000/tonne in the months preceding the Quarter. The Company
also reported that technical grade lithium carbonate prices had followed the
same trend with uncontracted spot prices up to RMB 40,000/tonne or approx US$
Lithium market watcher, Asia Metal Pty Ltd, said in a note published in the
Quarter that the "mainstream price of battery grade lithium carbonate rose to
about RMB 42,000-44,000/tonne (US$ 6,650-6,960/tonne inclusive of VAT) and for
small orders, many suppliers have sold at prices as high as RMB 45,000/tonne
The price increases in China follow the increases in global lithium product
prices, including lithium carbonate, announced by major producers Rockwood
Lithium and FMC Lithium this year.
Rockwood Lithium announced in early May 2012 to lift global lithium salts
prices by 22% or US$1,000 per metric tonne, effective 1 July 2012.
FMC Lithium announced a price increase of 20% on 23 June 2011 and then another
increase by $1,000/tonne on 18 June 2012.
Talison Lithium (spodumene supplier) announced a spodumene price increase of
15% in December 2011 and a further 10% increase on 12 July 2012.
Galaxy has been pleased to see such buoyant battery grade lithium carbonate
prices in China, which will ultimately translate into higher revenues from its
Jiangsu operations. With Jiangsu to reach full capacity in 2013, Galaxy is
well placed to take advantage of the strong lithium market outlook.
Caution Regarding Forward Looking Information.
This document contains forward looking statements concerning Galaxy and
Lithium One. Forward-looking statements are not statements of historical
fact and actual events and results may differ materially from those described
in the forward looking statements as a result of a variety of risks,
uncertainties and other factors. Forward-looking statements are inherently
subject to business, economic, competitive, political and social uncertainties
and contingencies. Many factors could cause the Company's actual results to
differ materially from those expressed or implied in any forward-looking
information provided by the Company, or on behalf of, the Company. Such
factors include, among other things, risks relating to additional funding
requirements, metal prices, exploration, development and operating risks,
competition, production risks, regulatory restrictions, including
environmental regulation and liability and potential title disputes.
Forward looking statements in this document are based on Galaxy's beliefs,
opinions and estimates of Galaxy (and Lithium One) as of the dates the forward
looking statements are made, and no obligation is assumed to update forward
looking statements if these beliefs, opinions and estimates should change or
to reflect other future developments.
Not For Release in US
This announcement has been prepared for publication in Australia and may not
be released in the U.S. This announcement does not constitute an offer of
securities for sale in any jurisdiction, including the United States, and any
securities described in this announcement may not be offered or sold in the
United States absent registration or an exemption from registration under the
United States Securities Act of 1933, as amended. Any public offering of
securities to be made in the United States will be made by means of a
prospectus that may be obtained from the issuer and that will contain detailed
information about the company and management, as well as financial statements.
Mining exploration entity quarterly report
Mining exploration entity quarterly report
Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98,
Name of entity
Galaxy Resources Limited
ABN Quarter ended ("current
11 071 976 442 30 September 2012
Consolidated statement of cash flows
Cash flows related to operating activities Current Year to date
quarter (9 months)
1.1 Receipts from product sales (1,345)(b) 5,688(b)
and related debtors
1.2 Payments for (a) (2,203) (3,373)
(c) production (11,534)(c) (42,968)
(d) (10,181)(d) (20,105)
1.3 Dividends received
1.4 Interest and other items of 95 317
a similar nature received
1.5 Interest and other costs of (319) (3,090)
1.6 Income taxes paid
1.7 Other (provide details if
Net Operating Cash Flows (25,487) (63,531)
Cash flows related to
1.8 Payment for purchases of: (10,625) (48,289)
1.9 Proceeds from sale of:
1.10 Loans to other entities
1.11 Loans repaid by other
1.12 Other (provide details if (2) 3
Net investing cash flows (10,627) (48,286)
1.13 Total operating and (36,114) (111,817)
investing cash flows
Total operating and (36,114) (111,817)
investing cash flows
Cash flows related to
1.14 Proceeds from issues of 600 30,747
shares, options, etc.
1.15 Proceeds from borrowings 19,860 63,535
1.16 Proceeds from convertible
1.17 Repayment of borrowings
1.18 Dividends paid
1.19 Other (Cash acquired from 6,191 6,191
Net financing cash flows 26,651 100,473
Net increase (decrease) in (9,463) (11,344)
1.20 Cash at beginning of 17,356 17,997
quarter/year to date
1.21 Exchange rate adjustments to (2,813) (1,573)
1.22 Cash at end of quarter 5,080(a) 5,080(a)
a Total undertaking by PRC banks of working capital of A$17m
b Revenues for Lithium Carbonate sales are currently being offset
against fixed assets under construction in accordance with
accounting standards (A$3.1m during the quarter).
c Mt Cattlin costs will be reduced in the next quarter due to the
temporary closure during the current period.
d Includes change of control payments and transaction costs for the
L1 merger of approximately $6m (YTD).
Payments to directors of the entity and associates of the
Payments to related entities of the entity and associates of the
1.23 Aggregate amount of payments to the parties 585
included in item 1.2
1.24 Aggregate amount of loans to the parties included -
in item 1.10
1.25 Explanation necessary for an understanding of the transactions
Includes directors' fees, salary and superannuation and also fees
paid to directors or director related entities for professional
and technical services.
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
Details of outlays made by other entities to establish or
2.2 increase their share in projects in which the reporting entity
has an interest
Financing facilities available
Add notes as necessary for an understanding of the position.
Amount available Amount used
3.1 Loan facilities 113,711* 96,531*
3.2 Credit standby arrangements - -
*As at 30 September 2012, RMB 633 million had been drawn down of approved RMB
746 million facilities. Therefore, the amount avaialble is 113m RMB (A$17m).
Estimated cash outflows for next quarter
4.1 Exploration and evaluation 500
4.2 Development -
4.3 Production (net of revenues) 4,000
4.4 Administration 4,000
Reconciliation of cash
Reconciliation of cash at the end of Current quarter Previous quarter
the quarter (as shown $A'000 $A'000
in the consolidated statement of cash
flows) to the related
items in the accounts is as follows.
5.1 Cash on hand and at bank 3,548 8,064
5.2 Deposits at call 1,532 9,292
5.3 Bank overdraft - -
5.4 Other (provide details) - -
Total: cash at end of quarter 5,080 17,356
Changes in interests in mining tenements - refer attached tenement
Tenement Nature of Interest at Interest at
reference interest beginning end of
(note (2)) of quarter quarter
6.1 Interests in
reduced or lapsed
6.2 Interests in
Issued and quoted securities at end of current quarter
Description includes rate of interest and any redemption or conversion
rights together with prices and dates.
Total number Number Issue price Amount paid
quoted per up
security per security
note 3) note 3)
7.2 Changes during
7.3 (+)Ordinary 506,359,341 506,359,341 - -
7.4 Changes during 127,811,590 141,934,138 127,032,369 $0.77
quarter Fully (4) Fully
(a) Increases Paid Paid
through issues Ordinary Ordinary
Exchangeable Shares and
Shares (in 14,122,588
Lithium One Voting
into pursuant to
14,122,588 the terms of
Paid merger with
Shares(2 ) One Inc
14,122,588 779,221 $0.77
Special Fully Paid
7.5 (+)Convertible 615 - - -
debt Bonds (face
(description) of $100,000
value of C$5
7.6 Changes during 9 - Issued -
quarter Convertible pursuant to
(a) Increases Notes the terms of
through issues the
7.7 Options Exercise Expiry date
conversion $0.45 26/11/14
factor) $0.60 Vesting not
750,000 - $0.90 26/11/14
3,350,000 - $0.96 Vesting not
5,350,000 - $1.11 satisfied
1,800,000 - $1.11 22/07/16
3,000,000 - $1.16 Vesting not
3,600,000 - satisfied
1,900,000 - Vesting not
39,100,000 - satisfied
7.8 Issued during - - - -
7.10 Expired during -
1 This statement has been prepared under accounting policies
which comply with
accounting standards as defined in the Corporations Act or
acceptable to ASX (see note 4).
2 This statement does give a true and fair view of the matters
here: Date: 31 October 2012
Print name: A L Meloncelli
1 The quarterly report provides a basis for informing the market how
the entity's activities have been financed for the past quarter
and the effect on its cash position. An entity wanting to
disclose additional information is encouraged to do so, in a note
or notes attached to this report.
2 The "Nature of interest" (items 6.1 and 6.2) includes options in
respect of interests in mining tenements acquired, exercised or
lapsed during the reporting period. If the entity is involved in a
joint venture agreement and there are conditions precedent which
will change its percentage interest in a mining tenement, it
should disclose the change of percentage interest and conditions
precedent in the list required for items 6.1 and 6.2.
3 Issued and quoted securities The issue price and amount paid up is
not required in items 7.1 and 7.3 for fully paid securities.
4 The definitions in, and provisions of, AASB 1022: Accounting for
Extractive Industries and AASB 1026: Statement of Cash Flows apply
to this report.
5 Accounting Standards ASX will accept, for example, the use of
International Accounting Standards for foreign entities. If the
standards used do not address a topic, the Australian standard on
that topic (if any) must be complied with.
Tenement Schedule as at 30 September 2012
Project Tenement Notes (100% interest
Sal De Vida Various 70% Interest upon satisfaction of
JV conditions with Kores Consortium.
Boxwood Hill E70/2493
Shoemaker E69/1869-1871 20% Interest with General Mining
Bakers Hill E74/287
Mt Cattlin L74/46
Sirdar E74/401 80% Interest with Traka Resources.
P74/309-P74/310 80% Interest with Traka Resources.
West Kundip L74/47
James Bay Various
(1) For voting purposes, the total number of shares presently carrying voting
rights in Galaxy Resources Limited is 506,359,341. This is made up of
492,773,833 Fully Paid Ordinary Shares and 13,585,508 Special Voting Shares
(which, effectively, may be voted by the holders of the remaining un-exchanged
13,585,508 Exchangeable Shares in Galaxy Lithium One Inc). These amounts are
aggregated on the basis that ASX has confirmed that the voting rights attached
to each Special Voting Share along with each Exchangeable Share (and its
associated exchange rights and obligations) together upon and from their issue
are to be treated as one Fully Paid Ordinary Share in Galaxy for the purposes
of the ASX Listing Rules.
(2) At the time of release of this Appendix 5B 537,080 Exchangeable Shares
have been exchanged for Fully Paid Ordinary Shares. Accordingly, 13,585,508
Exchangeable Shares are still to be exchanged.
(3) Although 14,122,588 Special Voting Shares are on issue, only 13,585,508
Special Voting Shares can be voted by the holders of the 13,585,508
un-exchanged Exchangeable Shares.
(4) At the time of the issue of 127,032,369 Fully Paid Ordinary Shares,
14,122,588 Exchangeable Shares and 14,122,588 Special Voting Shares as
consideration for the merger with Lithium One Inc, 40 Exchangeable Shares had
been exchanged for Fully Paid Ordinary Shares.
+ See chapter 19 for defined terms.
Corporate Iggy Tan Managing Director Galaxy Resources Limited
email@example.com t: +61 8 9215 1700
Australia Media Contact Jane Grieve FTI Consulting
firstname.lastname@example.org t: +61 8 9485 8888 m: +61 488 400 248
SOURCE: Galaxy Resources Limited
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-0- Oct/31/2012 21:30 GMT
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