ACN 156 369 336
PROSPECTUS
For the Offer of 20,000,000 Shares at an offer price of 20 cents each to raise up to $4,000,000 with a Minimum Subscription of $3,000,000 with 1 free attaching Listed Option exercisable at 30 cents on or before 31 March 2016 for every Share subscribed for and issued.
Oversubscriptions of up to a further 5,000,000 Shares at an issue price of 20 cents each to raise up to a further
$1,000,000 with 1 free attaching Listed Option for every Share subscribed for and issued may be accepted. For personal use only use personal For SPONSORING BROKER Kaz Capital Pty Ltd AFSL: 384738
Important Information This Prospectus provides important information to assist prospective investors in deciding whether or not to invest in the Company. It should be read in its entirety. If you do not understand it, you should consult your professional advisers.
THE SECURITIES OFFERED UNDER THIS PROSPECTUS ARE OF A SPECULATIVE NATURE. CORPORATE DIRECTORY
Directors Solicitors Peter McNeil Non-Executive Chairman Steinepreis Paganin Robert McNeil Managing Director/CEO Level 4 16 Milligan Street Graham Fish Non-Executive Director PERTH WA 6000 Jay Stephenson Non-Executive Director Page Seager Company Secretary RACT House Level 2 Lisa Hartin 179 Murray Street HOBART TAS 7000 Registered Office 2 Village High Road Independent Geologist BENOWA QLD 4217 Aimex Geophysics Pty Ltd Telephone: +61 7 5564 8823 PO Box 8356 Facsimile: +61 7 5597 7215 Gold Coast Mail Centre Website: www.torquemining.com.au BUNDALL QLD 9726 Email: [email protected] Investigating Accountant Share Registrar HLB Mann Judd Computershare Investor Services Pty Ltd Level 3, Corporate Centre One Level 2 2 Corporate Court 45 St Georges Terrace BUNDALL QLD 4217 PERTH WA 6000 Telephone: 1300 850 505 Corporate Adviser Telephone: +61 (0) 8 9415 4000 Outside Australia Facsimile: +61 (0) 8 9323 2033 Wolfstar Group Pty Ltd Level 4, 66 Kings Park Road Sponsoring Broker WEST PERTH WA 6005 Kaz Capital Pty Ltd Auditor * Level 1 277 Sussex Street HLB Mann Judd SYDNEY NSW 2000 Level 15, 66 Eagle Street
BRISBANE QLD 4000 For personal use only use personal For
* This entity is included for information purposes only. It has not been involved in the preparation of this Prospectus.
Photo on front cover Part of a massive sulphide outcrop at Wart Hill – channel sample over 3m assayed 21.9% zinc, 13.9% lead, 680g/t silver.
1 PROSPECTUS
IMPORTANT INFORMATION
This Prospectus is dated 25 January 2013 and was lodged with the Australian Securities and Investments Commission (“ASIC”) on that date. Neither ASIC nor ASX Limited (“ASX”) takes any responsibility for the contents of this Prospectus. No Securities will be issued on the basis of this Prospectus later than 13 months after the date of this Prospectus. The Directors of, and advisers to the Company do not guarantee the success of the Company, the repayment of capital, the payment of dividends or the price at which Securities will trade on ASX.
Application will be made to ASX within seven (7) days of the date of this Prospectus for Quotation of the Securities the subject of this Prospectus. It is important that investors read this Prospectus in its entirety and seek professional advice where necessary. The Securities subject of this Prospectus should be considered speculative.
No person is authorised to give information or to make any representation in connection with this Prospectus, which is not contained in the Prospectus. Any information or representation not so contained may not be relied on as having been authorised by the Company in connection with this Prospectus.
Electronic Prospectus This Prospectus will be issued in paper form and as an electronic Prospectus which may be accessed on the internet at www.torquemining.com.au. The Offer of Securities pursuant to the electronic Prospectus is only available to persons receiving an electronic version of this Prospectus in Australia. The Corporations Act prohibits any person passing onto another person the Application Form unless it is attached to, or accompanied by, the complete and unaltered version of the Prospectus. During the Offer Period, any person may obtain a hard copy of this Prospectus by contacting the Company by email at [email protected].
Foreign Jurisdictions This Prospectus does not constitute an offer in any place in which, or to persons to whom, it would not be lawful to make an offer. Distribution of this Prospectus in jurisdictions outside Australia may be restricted by law, and persons who come into possession of this Prospectus should seek advice and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws.
Exposure Period This Prospectus will be circulated during the Exposure Period. The purpose of the Exposure Period is to enable this Prospectus to be examined by market participants prior to the raising of funds. Potential investors should be aware that this examination may result in the identification of deficiencies in the Prospectus and, in those circumstances, any application that has been received may need to be dealt with in accordance with Section 724 of the Corporations Act.
Applications for Securities under this Prospectus will not be processed by the Company until after the expiry of the Exposure Period. No preference will be conferred on persons who lodge Applications prior to the expiry of the Exposure Period.
Website Address The Prospectus can be downloaded from www.torquemining.com.au.
Photographs and Diagrams Items and undertakings depicted in photographs and diagrams in this Prospectus are not assets of the Company, unless otherwise stated. Diagrams appearing in this Prospectus are illustrative only and may not be drawn to scale.
Definitionsonly use personal For Throughout this Prospectus abbreviations and defined terms are used. Those relevant to mineral exploration are contained in the Glossary located in the Independent Geologist Report in Section 4 of this Prospectus, and other abbreviations and legal terms are contained in the Definitions in Section 10 of this Prospectus. Defined terms are generally identified by the uppercase first letter.
2 CONTENTS
Investment Overview...... 4
Chairman’s Letter...... 15
1. Details of the Offer...... 17
2. Overview of the Company and Projects...... 20
3. Risk Factors...... 36
4. Independent Geologist’s Report...... 38
5. Investigating Accountant’s Report...... 116
6. Solicitor’s Report on Tenements...... 128
7. Material Contracts...... 145
8 Additional Information...... 146
9. Directors’ Consents...... 162
10. Definitions...... 163
Application Form and Instructions to Applicants For personal use only use personal For
3 PROSPECTUS
INVESTMENT OVERVIEW
The information in this Section is a summary of the key points only and is not intended to provide comprehensive details of the Offer. You should read the full text of this Prospectus and, if in any doubt, you should consult with your professional advisers before deciding whether to apply for Securities. The Securities offered under this Prospectus carry no guarantee in respect of return of capital, return on investment, payment of dividends or the future value of the Securities.
THE COMPANY AND PROJECTS The Company is a mineral exploration/development company planning to list on the ASX. It intends to engage in the exploration for and, subject to favourable feasibility studies and government approvals, the development of, and mining of mineral deposits in Tasmania.
The Company was incorporated on 20 March 2012 for the purpose of acquiring, developing, and further exploring gold and other metal projects held in Tasmania by Frontier Resources Ltd (Frontier).
These Tasmanian projects, Moina, Southern Mt Read Volcanics (SMRV), Mt Paris and Lower Pieman were held by Torque’s parent company, Frontier, an Australian Securities Exchange (ASX) listed company and were transferred to wholly owned subsidiary Torque Mining Ltd in May, 2012. Frontier and its predecessors have explored the SMRV Project since 1997 and the Moina Project since 2002, and recently acquired the Lower Pieman and Mt Paris Tin Projects. Frontier has carried out drilling, geochemical and geophysical surveys on both the Moina and SMRV Projects and Inferred and Indicated Mineral Resources have been defined at the Moina Project. Frontier’s total exploration expenditure in Tasmania on these and other projects since 2002 has been approximately $8.6 million.
Torque’s primary focus is gold exploration and development at Moina Project where small to medium sized gold/bismuth/base metal resources have been defined; where Frontier has demonstrated a substantial upside for discovery; and where resources may increase with additional exploration. At the SMRV Project Frontier has defined high-grade polymetallic zinc-lead-silver mineralisation similar to the Rosebery mine/deposit.
Torque’s primary project, Moina, has excellent access and mainly moderate topography, in comparison to much of Tasmania. It is well serviced by a network of sealed and graded roads, plus forestry tracks. There are no particular environmental or aboriginal heritage aspects that are likely to prevent mining. Moina is 40 kms south of the port of Devonport and local labour will be accessed for development.
OBJECTIVES AND STRATEGY The Company’s main objective is to move to gold production and an early cash flow utilising the existing Indicated Resources at Moina, and in conjunction with, and followed by drill based exploration to add to the current resource base in Tasmania.
To achieve these objectives, the Company’s strategy is as follows: • Acquire from Frontier three diamond core rigs and ancillary excavators, crawlers, trucks etc., (including a “truly man portable” rig which is easily moved into difficult areas and has minimum environmental impact). Most non-drill type exploration has been completed on these projects and the great majority of funds raised will go directly to drilling. Torque plans a continuous and ongoing drilling program both to add to the resource base and to locate further mineralised systems. • At Moina Project complete feasibility on existing resources and convert resources to reserves. Develop one or more mines either as a “stand alone” project or in joint venture with an existing producer; extend or replicate existing resources by drilling possible extensions and testing the many similar geological environments to the existing resources as defined by geochemistry and geophysics; drill out known major geophysical and geological targets that could represent major sulphide systems and/or gold and tin mineralised systems. • The Company has entered into a Joint Venture with BCD Resources NL (“BCD”) and Frontier, whereby, subject to a favourable Feasibility Study and Mine and Environmental permitting and grant of Mining Lease, the Indicated Resource at the Stormont For personal use only use personal For Prospect will be processed through BCD’s gold recovery plant at Beaconsfield, Tasmania. BCD will meet all costs up to production; BCD will be reimbursed for all mining, processing and associated costs incurred in the extraction of the gold; and the net cash flow (up to a gold price of US$1,700/oz) will be split between Torque, BCD and Frontier on their respective 45% - 50% - 5% equity basis. In addition, for gold sales above US$1,700, Torque and Frontier will receive all such additional benefit (pro rata). The Joint Venture is restricted to the Stormont Resource, but by mutual agreement other resources at Moina may be processed at Beaconsfield. This venture is risk-free financially to Torque as Torque is not required to provide any funds to the venture. • SMRV Project, drill the Wart Hill prospective horizon down plunge from the high grade Wart Hill massive sulphide lens; explore the Sassy Creek hybrid VHMS alteration system and other similar prospects for Wart Hill style massive sulphide and high-grade gold with 3DIP and drilling; target the “holy host” horizon elsewhere in the belt; ultimately seek J/V partner for development.
4 • At Mt Paris Tin Project carry out reconnaissance geochemical sampling to determine whether the targeted mineralisation styles (tin, rare earths) have economical potential. • At the Lower Pieman Project explore and subsequently drill test high-grade tungsten veins (lower priority work in first two years).
KEY RISKS The business, assets and operations of the Company are subject to certain risk factors that have the potential to influence the operating and financial performance of the Company in the future. These risks can impact on the value of an investment in the securities of the Company.
The Board aims to manage these risks by carefully planning its activities and implementing risk control measures. Some of the risks are, however, highly unpredictable and the extent to which they can effectively manage them is limited.
Set out below are specific risks that the Company is exposed to, and that may have a direct influence on the Company and its activities or assets.
Further risks associated with an investment in the Company are outlined in Section 3: • Renewal The renewal of the term of a Tenement is at the discretion of the Minister for Energy and Resources, Tasmania. If a Tenement is not renewed, the Company may suffer significant damage through the loss of opportunity to discover and develop mineral deposits on that Tenement. The expiry dates of RL3/2005 (part of the Moina Project) and EL20/1996 (part of the SMRV Project) occur in May 2013 and June 2013 respectively. As at the date of this Prospectus no application for renewal has been made and therefore no renewal has been granted. The requirements for renewal are set out in Section 4 of the Solicitor’s Report on Tenements included at Section 6 of this Prospectus. The Board believes it will be able to demonstrate it has satisfied these requirements at the time of renewal and is not aware of any reason that the renewal applications would not be granted.
• No Mining Lease An initial focus of the Company is on bringing the Indicated Resources at the Stormont Deposit to production and providing a cash flow within 6 months through a Joint Venture and with the assistance of, and using the processing facilities of, BCD Resources NL at Beaconsfield, Tasmania. Further details of this agreement are set out in section 2.3 of this Prospectus. The commencement of production on the Stormont Deposit and any other Tenements remains subject to a favourable feasibility study, mine environmental permitting and granting of a mining lease. If these pre-conditions to production are not satisfied the Company will not be able to derive an income stream from those Tenements or where they are satisfied the timing of deriving an income stream may be delayed beyond the Company’s target of 6 months from Quotation.
• Reliance on Key Personnel The Company has a Managing Director, Exploration Manager (not a director) and three Non-executive Directors. The Board is aware of the need to have sufficient management to properly supervise the exploration and (if successful) for the development of the projects in which the Company has, or will in the future have, an interest and the Board will continually monitor the management roles in the Company. As the Company’s projects require an increased level of involvement the Board will look to appoint additional management and/or consultants when and where appropriate to ensure proper management of the Company’s projects. However, there is a risk that the Company may not be able to secure personnel with the relevant experience at the appropriate time which may impact on the Company’s ability to complete all of its preferred exploration programmes in its preferred timetable. The responsibility of overseeing the day-to-day operations and the strategic management of the Company depends substantially on the Board. There can be no assurance given that there will be no detrimental impact on the Company if one or more of these
Directors cease their employment. For personal use only use personal For • Tenement Risk/Contractual Risk Directors are unable to predict the risk of financial failure or default by a participant in any joint venture to which the Company may be, or may become, a party; or insolvency or other managerial failure by any of the contractors used by the Company in any of its activities; or insolvency or other managerial failure by any of the other service providers used by the Company for any activity. Any such failure could adversely affect the operations and performance of the Company. The Company has granted title to all its licences in Tasmania (see Solicitor’s Report on Tenements), subject to a residual 10% holding in the Moina, Mt Paris and Lower Pieman Projects by Frontier and in the SMRV Project by Exploration & Management Consultants Pty Ltd.
5 PROSPECTUS
All projects require exploration expenditure and programs to be completed in accordance with the requirements of each licence. Failure to complete these obligations could cause the Tasmanian Government to revoke one or more of these licences. If a licence is revoked, the Company may suffer significant damage through the loss of opportunity to discover and develop mineral deposits on that licence.
There is no contractual risk at present although such risk may be present in the near future if development and mining proceeds at the Moina Project. Directors are unable to predict the risk of financial failure or default by participation in any joint venture to which the Company may be, or may become, a party; or insolvency or other managerial failure by any of the other service providers used by the Company for any activity. Any such failure could adversely affect the operations and performance of the Company.
• Exploration/Development Risks There has been extensive exploration by the Company’s parent, Frontier, on the SMRV and Moina Projects with the estimation of resources complying with the JORC Code. There has been very limited exploration by Frontier or the Company on the Mt Paris and Lower Pieman Projects. In the event that only the minimum subscription is raised it may necessitate the Company abandoning the Mt Paris and Lower Pieman projects to allow focusing on the gold and base metal potential at the Moina and SMRV Projects. Potential investors should understand that mineral exploration and development are high-risk undertakings. There can be no assurance that exploration of the Tenements, or any other tenements that may be acquired in the future, will result in the discovery of an economic ore deposit. Even if an apparently viable deposit is identified, there is no guarantee that it can be economically exploited.
• BCD Resources NL Joint Venture Risk In the event that the feasibility study is not positive for Stormont or that a Mining Lease is not granted within a reasonable period of time, it is possible that the Joint Venture will not proceed.
• Resource Estimations Resource estimates are inherently imprecise as they are expressions of judgement at a particular time based on available information, interpreted using experience and resource modelling techniques. The estimates, while made by qualified professionals, may change over time as other information becomes available which differs from information known or predicted by past drilling, sampling and geological interpretation. Estimates remain subject to change and no assurance can be given that the cost estimates and the underlying assumptions will be realised in practice, which may materially and adversely affect the Company’s viability.
• Future Requirements for Capital The exploration costs of the Company described in the Independent Geologist’s Report are based on certain assumptions with respect to the method and timing of exploration. There can be no guarantees that the funds raised by this Offer will be sufficient to successfully achieve all of the Company’s objectives.
The funds raised by the Offer will be used to carry out work on the Company’s projects as detailed in this Prospectus. If the Company incurs unexpected costs or is unable to generate sufficient operating income, further funding may be required. The Company may require additional funding to carry out further exploration, undertake feasibility studies, develop mining operations and/or acquire new projects. Any additional financing through share issues may dilute shareholdings acquired under this Prospectus. Debt financing may not be available to support the scope and extent of proposed developments. If available, it may impose restrictions on operating activities or anticipated expansion of the Company’s operations.
• Limited History The Australian company was only recently incorporated (20 March 2012) and has no operating history and limited historical financial performance. Exploration has previously been conducted on the area of land the subject of the Tenements, however, no assurance can be given that the Company will achieve commercial viability through the successful exploration and/or mining of the Project. Until the Company is able to realise value from its projects, it is likely to incur ongoing operating losses.
• Registered Third Party Interest A dealing was registered against exploration licence 20/1996 on 26 May 1998. The dealing is in relation to an interest arising
pursuantonly use personal For to a sale and joint venture agreement between Exploration & Management Consultants Pty Ltd (EMC) and Fimiston Mining NL (FIM).
The Board, having made all reasonable inquiries, is of the view that the interest registered by FIM is of no force or effect following the withdrawal of FIM from the agreement with EMC as announced by FIM to ASX on 29 April 1999. In addition, pursuant to the agreement with Frontier Resources Limited (Frontier) under which the Company acquired its interest in EL20/1996, Frontier has warranted to the Company that no person has any rights of any nature in EL20/1996 (other than the 10% interest held by EMC).
The Board is taking all reasonable steps to remove the registration of this dealing.
6 THE OFFER The Company invites applications for up to 20,000,000 ordinary Shares at an issue price of 20 cents each to raise up to $4,000,000 with a minimum subscription of $3,000,000. Oversubscriptions to raise up to a further $1,000,000 may be accepted. The key information relating to the Offer and references to further details are set out below.
Indicative Timetable*
Lodgement of this Prospectus with ASIC 25 January 2013
Opening Date of the Offer 4 February 2013
Expected Closing Date of the Offer 15 March 2013
Dispatch of Holding Statements 22 March 2013
Expected date for Securities to commence trading on ASX 28 March 2013
*The above dates are indicative only and may change without notice. The Company reserves the right to extend the Closing Date or close the Offer early without notice.
KEY INFORMATION FURTHER DETAILS Type of security being offered and its rights and liabilities Section 1.2 Fully paid ordinary shares in the capital of the Company ranking equally with existing Shares on issue. Listed Option exercisable at 30 cents on or before 31 March 2016 Minimum Subscription of the Offer Section 1.2 $3,000,000 How to apply for Shares Section 1.4 Complete and return the Application Form together with payment in full for the quantity of Shares being applied for. Applications must be for a minimum of 10,000 Shares (other than applicants with an existing shareholding in the Company who may apply for that number of Shares that will result in the aggregate number of Shares held on completion of the Offer being 10,000) and thereafter in multiples of 1,000 Shares. Will the securities be listed? Section 1.8 Application for Official Quotation by ASX of the Securities offered pursuant to this Prospectus will be made within 7 days after the date of this Prospectus. How will Securities be allocated? Section 1.5 The Directors will determine the allottees in their sole discretion. Where will the Offer be made? Section 1.10 No action has been taken to register or qualify the Securities, or, otherwise permit a public offering of the Securities the subject of this Prospectus, in any jurisdiction outside Australia. Applicants who are resident in countries other than Australia should consult their professional advisers as to whether any governmental or other consents are required or whether any other formalities need to be considered and followed. Broker commissions Section 1.6 The Company reserves the right to pay a commission of amounts subscribed through any licensed securities dealers or Australian financial services licensee and accepted by the Company. CHESS & Issuer Sponsorship Section 1.9
For personal use only use personal For The Company will apply to participate in CHESS, for those investors who have, or wish to have, a sponsoring stockbroker. Investors who do not wish to participate through CHESS will be issuer sponsored by the Company. Who should I contact with queries? Any questions concerning the Offer should be directed to the Company by telephone on +61 (0) 7 5564 8823 or +61 (0) 400 756 628.
7 PROSPECTUS
PURPOSE OF THE OFFER The purpose of the offer is to facilitate an application by the Company for admission of the Company to the official list of the ASX and position the Company to seek to achieve the objectives set out above.
USE OF FUNDS The Company intends to apply funds raised from the Offer together with existing cash reserves over the first two years following admission of the Company to the official list of ASX as follows:
Use of Funds Notes Minimum % of Full % of Maximum % of Subscription funds Subscription funds Subscription funds $3,000,000 raised $4,000,000 raised $5,000,000 raised Pre-offer cash 463,545 463,545 463,545 Add back expenses of the 60,556 60,556 60,556 Offer already paid for Total raised in the Offer 1 3,000,000 4,000,000 5,000,000 Total Funds Available 3,524,101 4,524,101 5,524,101 Exploration Expenditure 2 1,566,000 52.2 2,490,000 62.3 3,290,000 65.8 Expenses of the Offer 3 376,350 12.5 393,600 9.8 410,850 8.2 (excluding Application Handling Fees) Application Handling Fees 4 180,000 6.0 240,000 6.0 300,000 6.0 Repayment of Loans 210,937 7.0 210,937 5.3 210,937 4.2 Administration 5 1,032,000 34.4 1,032,000 25.8 1,032,000 20.6 Working Capital 158,814 5.3 157,564 3.9 280,314 5.6
Total Funds Applied 3,524,101 4,524,101 5,524,101
Notes: 1. If the Company raises more than the Minimum Subscription, but less than the Maximum Subscription, the Company intends to apply these funds first to the associated increase in the application handling fee and expenses of the Offer generally and secondly to exploration expenditure. 2. Exploration expenditure is described in more detail in Section 2.5.5 of this Prospectus. 3. Refer to the breakdown of the expenses of the Offer below. 4. An Application Handling Fee will only be paid on applications made through the Sponsoring Broker or such other licensed securities dealer or Australian financial services licensee accepted by the Company (refer to Section 1.7 of this Prospectus for further information). The amount calculated is based on 100% of applications being made in this manner. For those applications made directly to and accepted by the Company no such fee will be payable and the additional funds will be put towards working capital. 5. This amount consists of $504,000 for the first year following admission of the Company to the Official List and $528,000 for the second year and is comprised of approximately $372,000 per annum in Director remuneration and administration salaries, $67,000 per annum pursuant to insurance and other office costs, and a further $65,000 per annum in corporate and adviser fees (primarily audit, legal, share registry and ASX listing).
The above table and the exploration programmes and associated expenditure outlined in Section 2 of this Prospectus are statements of current intentions at the date of the lodgement of this Prospectus with the ASIC. As with any budget, intervening events (including exploration success or failure) and new circumstances have the potential to affect the ultimate way funds will be applied. The Board
reserves the right to alter the way funds are applied in these circumstances. For personal use only use personal For
8 CAPITAL STRUCTURE The capital structure of the Company following completion of the Offer is summarised below:
Minimum Full Over Subscription % Subscription % Subscription % $3,000,000 $4,000,000 $5,000,000 SHARES Vendor Shares 10,001,679 13.2 10,001,679 12.4 10,001,679 11.6 Frontier Shareholders 29,998,321 39.5 29,998,321 37.1 29,998,321 34.9 Seed Capitalists 20,940,002 27.6 20,940,002 25.9 20,940,002 24.4 Shares pursuant to this Offer 15,000,000 19.7 20,000,000 24.6 25,000,000 29.1 Total 75,940,002 100 80,940,002 100 85,940,002 100
OPTIONS Options pursuant to this Offer 15,000,000 79 20,000,000 83 25,000,000 86 Unlisted Options - Directors 4,000,000 21 4,000,000 17 4,000,000 14 Total 19,000,000 100 24,000,000 100 29,000,000 100
40,000,000 Shares were issued to Frontier in consideration for the acquisition of the Tenements. On 9 January 2013, 29,998,321 Shares held by Frontier were distributed in-specie to Frontier Shareholders. 20,940,000 Shares were issued at 5 cents per Share to seed capital investors to fund the listing costs and initial working capital requirements of the Company including preliminary work associated with the overall long term exploration strategy, including establishing a Tasmanian office, negotiation of and entry into the joint venture agreement with BCD Resources NL in relation to developing the Stormont Deposit and further exploration of the Tasmanian Projects. These Shares were issued at a discount to the issue price of the Shares offered pursuant to the Offer to reflect the increased risk associated with an investment in the Company at the time of issue of the seed capital.
It is the intention of the Company to offer all Shareholders, registered approximately 4 months after Quotation, one Option for every two Shares held at that time. The purchase price will be 0.25 cents (a quarter of a cent) per Option, exercisable at 30 cents per Option on or before 31 March 2016. The terms and conditions of these Options are set out in Section 8.5 of this Prospectus.
Refer to the Investigating Accountant’s Report and section 1.5 for further information.
Rights attaching to the Shares are summarised in Section 8.4 of this Prospectus.
Terms and Conditions of Options are summarised in Section 8.5 of this Prospectus.
SUBSTANTIAL SHAREHOLDERS As at the date of the Prospectus
Those Shareholders holding 5% or more of the Shares on issue at the date of this Prospectus:
% % Shareholder Shares (undiluted) (fully diluted) Frontier Resources Limited 10,001,679 25.1 15.7 Mr James David Thorn and Mrs Suporn Thorn 6,000,000 15.0 9.4 McNeil Associates Pty Ltd
For personal use only use personal For Ok Tedi Mining Limited 2,361,005 5.9 3.7
* This entity is controlled by Robert McNeil.
On completion of the Offer (assuming no existing substantial Shareholder subscribes and receives additional Shares pursuant to the Offer)
9 PROSPECTUS
Those Shareholders holding 5% or more of the Shares on completion of the Offer:
% % Shareholder Shares (undiluted) (fully diluted) Frontier Resources Limited 10,001,679 16.7 10.5 Mr James David Thorn and Mrs Suporn Thorn 6,000,000 10.0 6.3 McNeil Associates Pty Ltd
* This entity is controlled by Robert McNeil.
The Company will announce to ASX details of its Top-20 Shareholders (following completion of the Offer) prior to the Shares commencing trading on ASX.
RESTRICTED SECURITIES Subject to the Company being admitted to the Official List, certain of the Shares and Options on issue prior to the Offer and certain of the Shares issued on the exercise of the Options on issue prior to the Offer, are likely to be classified by ASX as restricted securities and will be required to be held in escrow. During the period in which these securities are prohibited from being transferred, trading in Shares may be less liquid which may impact on the ability of a Shareholder to dispose of his or her Shares in a timely manner.
It is estimated that 25,795,000 Shares and 4,000,000 Options will be subject to escrow as follows:
• 7,153,882 Shares for 24 months from the date of Official Quotation (held by seed investors classified as related parties or promoters);
• 10,001,679 Shares for 24 months from the date of Official Quotation (held by Frontier Resources Limited);
• 9,135,000 Shares from 12 months from date of Issue of Shares (held by seed investors and not classified as related parties or promoters);
• 4,000,000 Options for 24 months from the date of Official Quotation (held by Directors).
The Company will announce to the ASX full details of the quantity and duration for the Shares and Options required to be held in escrow prior to the Shares commencing trading on ASX.
FINANCIAL INFORMATION The Company was only recently incorporated (20 March 2012) and has limited operating history and limited historical financial performance.
As a result, the Company is not in a position to disclose any key financial ratios other than its balance sheet which is included in the Investigating Accountant’s Report set out in Section 5 of this Prospectus.
TAXATION The acquisition and disposal of Securities will have tax consequences, which will differ depending on the individual financial affairs of each investor. All potential investors in the Company are urged to obtain independent financial advice about the consequences of acquiring Securities from a taxation viewpoint and generally.
To the maximum extent permitted by law, the Company, its officers and each of their respective advisors accept no liability and
responsibility with respect to the taxation consequences of subscribing for Securities under this Prospectus. For personal use only use personal For DIVIDEND POLICY The Company anticipates that significant expenditure will be incurred in the evaluation and development of the Company’s projects. These activities, together with the possible acquisition of interests in other projects, are expected to dominate the two year period following the date of this Prospectus. Accordingly, the Company does not expect to declare any dividends during that period.
Any future determination as to the payment of dividends by the Company will be at the discretion of the Directors and will depend on the availability of distributable earnings and operating results and financial condition of the Company, future capital requirements
10 and general business and other factors considered relevant by the Directors. No assurance in relation to the payment of dividends or franking credits attaching to dividends can be given by the Company.
DIRECTORS & KEY PERSONNEL
Peter McNeil, B.Sc, M.Sc, MAIG Non-Executive Chairman Mr Peter McNeil is a graduate from the University of Houston, Texas B.Sc. (1982) and M.Sc. (Geochemistry-1985). He has accumulated more than 28 years’ continuous professional post–graduate mineral exploration industry experience, with 26 of those in Papua New Guinea (including the Lihir gold Deposit). He has also worked in Tasmania, WA’s Kimberley and NE Goldfields, Arizona and Newfoundland. He was consultant site supervisory geologist on the ‘discovery’ holes of both the Nimary and Sunrise Dam gold ore bodies in WA, which became the largest and second largest gold discoveries in Australia during the 1990’s totalling about 14 million ounces combined.
Mr Peter McNeil has 17 years’ corporate and managerial experience as a Chairman, Managing Director, Director, and President associated with several ASX and TSX-V listed companies. He is currently Chairman/ Managing Director of Frontier Resources Limited.
Mr Peter McNeil is a member of the Australian Institute of Company Directors, the Australian Institute of Geoscientists, the Society of Economic Geologists, the Society for Geology Applied to Mineral Deposits and the Society of Resource Geology. He is the principal of a private mineral exploration consultancy (Exploration & Management Consultants Pty Ltd), which has provided a varied range of exploration and corporate services to the minerals exploration industry for the past 19 years.
Mr Peter McNeil does not expect that his directorships with other companies or other business activities will interfere with his ability to act as Executive Chairman to the Company.
Robert McNeil, B.Sc (Honours), M.Sc, F.AusIMM, F.SEG Managing Director/Chief Executive Officer Mr Robert McNeil graduated B.Sc Honours in 1959 and M.Sc in 1980 from University of Tasmania. He has more than 50 years’ experience in exploration and mining, including feasibility studies and mine management. He has worked in many countries, with substantial experience in Tasmania. Mr McNeil commenced work at Tennant Creek where he participated in most discoveries by Peko Wallsend. He was Exploration Manager in WA for Kennecott, in SW USA for UNOCAL, and General Manager for Exxon Minerals in PNG. He was previously Managing Director for Macmin Silver, and Chairman of both New Guinea Gold Corp and Coppermoly Ltd.
Mr Robert McNeil currently resides on no other public boards.
Graham Fish, B.Sc, Dip.Ed, M.Ed Non-Executive Director Mr Graham Fish graduated B Sc. (Geology, Chemistry) in 1958, Dip. Ed. in 1961 and M Ed. in 1980 from the University of Tasmania. He worked as a teacher of Geology and Chemistry in Tasmanian Education Department Colleges before promotion into administrative roles from 1973.
Mr Fish has over 40 years of management skills and has extensive experience in administration and education development in Tasmania. He has a background in geology and has chaired committees on both national and State school curriculum and assessment boards. He has delivered papers and written science and education reports for UNESCO in Bangkok in 1983, and in Korea in 1988, for the South Pacific in Fiji in 1995, for International Conferences in Sydney in 1993 and New Zealand in 1994.
Mr Fish is currently a Non-executive Director of Frontier Resources Limited.
Mr Fish is an independent Director free from any business or other relationships that could materially interfere with, or reasonable be For personal use only use personal For perceived to materially interfere with, the independent exercise of his judgement.
Mr Fish does not expect that his other business activities will interfere with his availability to act as Non-executive Director to the Company.
11 PROSPECTUS
Jay Stephenson MBA, FCPA, CMA, FCIS, MAICD Non-executive Director Mr Jay Stephenson holds a Master of Business Administration, is a Fellow Certified Practicing Accountant, a Certified Management Accountant (Canada), a Fellow of the Chartered Institute of Secretaries and is a Member of the Australian Institute of Company Directors.
Mr Stephenson has been involved in business development for over 20 years including approximately 16 years as Director, Chief Financial Officer and Company Secretary for various listed and unlisted entities in resources, manufacturing, wine, hotels and property. He has been involved in business acquisitions, mergers, initial public offerings, capital raisings, business restructuring as well managing all areas of finance for companies.
Mr Stephenson is currently a non-executive Chairman of Quintessential Resources Limited, and is a Director of Aura Energy Limited, Drake Resources Limited, Doray Minerals Limited, Strategic Minerals Corporation NL, Nickelore Limited, and Spencer Resources Limited and as well as Company Secretary for a number of ASX listed resource and industrial companies.
Mr Stephenson does not expect that his directorships with other companies or other business activities will interfere with his ability to act as Non-Executive Director to the Company.
Lisa Hartin, Bachelor of Business Chief Financial Officer and Company Secretary Ms Lisa Hartin holds a Bachelor of Business from Griffith University and has 25 years’ accounting experience, all in the exploration and mining industry.
Ms Hartin was Accountant/Chief Accountant for Macmin Silver Limited for 17 years and Chief Accountant / Chief Financial Officer for New Guinea Gold Corporation for 3 years until February 2012. Throughout her career, Ms Hartin has focussed on exploration and mining accounting, financial accounting and administration including all aspects of corporate, compliance and ASX listed accounting.
Grant MacDonald B.Sc (Hons.) - University of Tasmania Exploration Manager – Tasmania Mr Grant MacDonald has 21 years’ experience largely as a hands on geologist both in grass roots exploration, mining and resource geology, predominantly within Tasmania. In the 1990’s Mr MacDonald managed exploration for Plutonic and Resolute looking particularly for VHMS and porphyry copper and gold in the Mt Read Volcanics and mesothermal gold in the northeast with some success. He then worked at the Beaconsfield gold mine for over 10 years as Exploration Geologist and later Senior Mine Geologist. For most of his time at Beaconsfield he was responsible for following and extending the resource at depth as well as overseeing the underground mining geology in this structurally controlled orebody. Prior to joining Frontier Resources Ltd, Mr MacDonald was a Senior Exploration geologist for Bass Metals exploring around Hellyer/Que River and south of Henty. Mr MacDonald has had considerable experience in the Mt Read Volcanics, having worked at or on most deposits at some time, and Tasmanian geology in general. He is highly motivated for a discovery in his home state.
CORPORATE GOVERNANCE To the extent applicable, in light of the Company’s size and nature, the Company has adopted The Corporate Governance Principles and Recommendations with 2010 Amendments (2nd Edition) as published by ASX Corporate Governance Council (Recommendations).
The Company’s main corporate governance policies and practices as at the date of this Prospectus are outlined in Section 8 of this Prospectus and the Company’s compliance and departures from the Recommendations are set out in Section 8 of this Prospectus.
In addition, the Company’s full Corporate Governance Plan is available from the Company’s website (www.torquemining.com.au). For personal use only use personal For DISCLOSURE OF INTERESTS The Company has paid no remuneration to non-executive Directors since incorporation to the date of this Prospectus and no remuneration will be paid or accrue until such time as the Company is admitted to the Official List.
12 For each of the Directors, the proposed annual remuneration (which is inclusive of applicable statutory superannuation) for the financial year following the Company being admitted to the Official List together with the relevant interest of each of the Directors in the securities of the Company as at the date of this Prospectus is set out in the table below.
Director Total Remuneration Shares Options $ Peter McNeil 65,400 3,200,701 2,000,000 Robert McNeil1 185,300 6,171,182 - Graham Fish 43,600 273,157 1,000,000 Jay Stephenson1 43,600 594,533 1,000,000
1 Robert McNeil has been paid for services as Managing Director $53,848 to date and has accrued $26,920 which will be paid after listing. Mr McNeil will continue to be paid $3,847 per fortnight and accrue $1,922 per fortnight until the Company is quoted on ASX. 2 Jay Stephenson is a Director of Wolfstar Group Pty Ltd (“Wolfstar Group”). The Company engaged the Wolfstar Group for the period of six months (or such longer period as the parties may agree) to act as manager of its initial public offering, and to provide financial and corporate advice and assistance in connection with the Offer. For details of the fees payable to the Wolfstar Group see Agreements with Directors or Related Parties section in Prospectus. The Company has engaged Wolfstar Corporate Management Pty Ltd, an entity controlled by Jay Stephenson of which Jay Stephenson is a Director, to provide assistance to the company secretary for 12 months commencing on the date of Quotation. The fee payable is $1,000 per month (exclusive of GST). The Director who did not have a material personal interest in this agreement considered that it was negotiated at arm’s length
EXPENSES OF THE OFFER The estimated total expenses of the Offer (exclusive of GST) are expected to be applied as set out below:
Based on Based on Based on $3,000,000 $4,000,000 $5,000,000 Application Handling Fees1 180,000 240,000 300,000 Investigating Accountants’ Report 7,500 7,500 7,500 Legal Expenses 50,000 50,000 50,000 Independent Geologist’s Report 36,600 36,600 36,600 ASX and ASIC fees 68,090 70,340 72,590 Corporate Adviser Fees2 81,000 96,000 111,000 Sponsoring Broker Fee 100,000 100,000 100,000 Share Registry 7,500 7,500 7,500 Printing, marketing and distribution 25,660 25,660 25,660 Total 556,350 633,600 710,850
Note 1 - An Application Handling Fee will only be paid on applications made through a licensed securities dealers or Australian financial services licensee and accepted by the Company (refer to Section 1.7 of this Prospectus for further information). The amount calculated is based on 100% of applications being made in this manner. For those applications made directly to and accepted by the Company no such fee will be payable and the additional funds will be put towards working capital. Note 2 – Pursuant to the Service Agreement with Wolfstar (details set out below). Wolfstar has received 360,000 Shares representing $18,000 of its fee.
AGREEMENTS WITH DIRECTORS OR RELATED PARTIES For personal use only use personal For The Company’s policy in respect of related party arrangements is: (a) a Director with a material personal interest in a matter is required to give notice to the other Directors before such a matter is considered by the Board; and (b) for the Board to consider such a matter, the Director who has a material personal interest is not present while the matter is being considered at the meeting and does not vote on the matter.
13 PROSPECTUS
Employment Services Agreement with Managing Director On 21 November 2012, the Company entered into a service agreement (Services Agreement) with Robert McNeil in his capacity of Managing Director. Under the Services Agreement, Mr McNeil is engaged by the Company to provide services to the Company in the capacity of Managing Director. Mr McNeil is to be paid an annual remuneration of $170,000 per annum plus superannuation commencing from the date of Quotation. Mr McNeil will also be reimbursed reasonable expenses incurred in his capacity as Managing Director.
The Services Agreement continues for a period of 3 years from the date of Quotation, unless otherwise extended or terminated in accordance with the terms. Mr McNeil will have an annual pay review. If the Services Agreement is terminated by the Company Mr McNeil will be given 4 weeks notice (or no notice in the event of specified material breaches) or alternatively, payment in lieu of service. In addition, Mr McNeil is entitled to all unpaid remuneration and entitlements up to the date of termination. If the Services Agreement is terminated at the election of Mr McNeil the Company must be given 3 months notice and Mr McNeil is only entitled to unpaid remuneration and entitlements up to the date of termination.
If the Services Agreement is terminated other than for reasons where no notice is required to be given and the Managing Director is not otherwise in default of the Services Agreement, the Managing Director will in connection with his retirement from office receive atermination benefit payment of $100,000 subject to any restrictions imposed by the ASX Listing Rules or Corporations Act at the time.
Service Agreement with Wolfstar On 1 June 2012, the Company engaged Wolfstar Group Pty Ltd (“Wolfstar Group”), of which Mr Jay Stephenson is a Director, for a minimum period of three months and a maximum period of six months (or such longer period as the parties may agree) from 1 June 2012 to act as manager of its initial public offering, and to provide financial and corporate advice and assistance in connection with the Offer. This term has been extended until such time as the Company lists on ASX.
In consideration for the services provided, Wolfstar Group is entitled to the following fees: (a) a Pre-IPO Fee of $6,000 (plus GST) per month for a maximum of six months prior to the Offer; (b) A Work Fee of 1.5% of the total capital raised, payable upon the admission of the Company to the official list of the ASX.
The Company will reimburse Wolfstar Group for all reasonable out-of-pocket expenses incurred including, but not limited to, printing, courier, and travel, and of any other advisers and consultants which may be required.
The Directors who did not have a material personal interest in this agreement considered that it was negotiated at arm’s length.
Indemnity, Insurance and Access Deeds The Company has entered an Indemnity, Insurance and Access Deed with each Director.
Pursuant to the Deed: The Director is indemnified by the Company against any liability incurred in that capacity as an officer of the Company to the maximum extent permitted by law subject to certain exclusions.
The Company must keep a complete set of company documents until the later of: • the date which is seven years after the Director ceases to be an officer of the Company; and • the date after a final judgment or order has been made in relation to any hearing, conference, dispute, enquiry or investigation in which the Director is involved as a party, witness or otherwise because the Director is or was an officer of the Company (“Relevant Proceedings”).
The Director has the right to inspect and/or copy a company document in connection with Relevant Proceedings during the period
referred to above. For personal use only use personal For Subject to the next sentence, the Company must maintain an insurance policy insuring the Director against liability as a director and officer of the Company while the Director is an officer of the Company and until the later of: • the date which is seven years after the Director ceases to be an officer of the Company; and • the date any Relevant Proceedings commenced before the date referred to above have been finally resolved.
The Company may cease to maintain the insurance policy if the Company reasonably determines that the type of coverage is no longer available.
14 CHAIRMAN’S LETTER
On behalf of the Directors of Torque Mining Limited (“Torque” or “the Company”), it is my pleasure to introduce this Prospectus to you and invite you to become a shareholder in the Company.
This Prospectus has been issued by the Company for the purpose of the offer of 20 million shares at 20 cents per share to raise $4,000,000, with a minimum subscription of $3,000,000 and with over subscriptions of a further $1,000,000 taking the maximum subscription to $5,000,000. One free attaching Listed Option exercisable at 30 cents on or before 31 March 2016 will be issued for every one Share subscribed for and issued.
The Company was incorporated on 20 March 2012 with the intention of developing mineral resources in Tasmania held, at that time, by former parent company Frontier, and for the continued exploration of, and further development of, mineral exploration projects also held by Frontier in Tasmania.
Torque is focused on gold exploration and development at its Moina Project, but its project areas collectively cover a wide range of mineralisation styles and geological settings. Specific opportunities as set out in the Independent Geologist’s Report are as follows:
• Gold+/-bismuth+/-base metals in skarn style deposits associated with intrusive granites (e.g. current resources at Stormont and Narrawa Creek) - Moina Project.
• Gold in disseminations and/or veins associated with intrusive granite (e.g. Pogo and Fort Knox, Canada) - Moina Project.
• High grade zinc+lead+gold+silver in Volcanic Hosted Massive Sulphide style (e.g. Rosebery, Hellyer and Mt Lyell, Tas.) – SMRV and Moina Projects.
• Tungsten+/-molybdenum+/-bismuth+/-tin in vein or skarn deposits (e.g. Shephard and Murphy, King Island and Kara, Tas.) – Moina, Lower Pieman and Mt Paris.
• Tin as disseminations in “greisen” altered granite and/or replacement/skarn tin deposits (e.g. Mt Bischoff and Renison, Tas.) – Moina, Mt Paris and Lower Pieman Projects.
These Tasmanian projects were held by Frontier, an Australian Securities Exchange (ASX) listed company and were transferred to its then wholly owned subsidiary Torque Mining Ltd in May 2012. Frontier and its predecessors have explored the SMRV Project since 1997 and the Moina Project since 2002 and recently acquired the Lower Pieman and Mt Paris Projects. Frontier has carried out significant drilling, geochemical and geophysical surveys on both the Moina and SMRV Projects and Inferred and Indicated Mineral Resources have been defined at the Moina Project. Frontier’s total exploration expenditure in Tasmania on these and other projects since 2002 has been approximately $8.6 million.
Frontier has defined small to medium sized gold/bismuth/base metal resources at Moina and also demonstrated a substantial upside for discovery, where resources are likely to increase with additional exploration. In particular, a recent 3D Induced Polarisation Survey (3DIP) at Moina has defined many previously unknown or covered targets similar to the existing resources or maybe large disseminated gold targets. At the SMRV Project, Frontier has defined high-grade polymetallic zinc-lead-silver mineralisation similar to the Rosebery mine/deposit.
A recent Scoping Study on the two Indicated Resources at Stormont and Narrawa in the Moina Project by Swain Engineers made the following recommendations with respect to the Stormont and Narrawa Prospects:
“This Scoping Study indicates the potential of a satisfactory investment which will yield a future source of income to the shareholders of Torque.
We recommend that a full Feasibility Study commences without delay.”
Torque’s strategy is to use the present resources to provide a cash flow as soon as possible, to rapidly delineate additional gold
For personal use only use personal For (and possibly bismuth and base metal) resources at Moina and explore to depth the high-grade massive sulphides at SMRV project. Torque has access to three diamond core rigs, drill crews and ancillary equipment.
To meet Torque’s strategy for an early cash flow, Torque entered into a Joint Venture with BCD and Frontier whereby BCD will, subject to completion of a Feasibility Study and permitting, process the Stormont Resource at its plant at Beaconsfield, Tasmania. This Joint Venture is financially risk-free to Torque as Torque is not required to provide any funds to the Joint Venture. Details of this Joint Venture are described in Section 2.2, the Independent Geologist’s Report and Material Contracts later in this Prospectus. This
15 PROSPECTUS
Joint Venture is an exciting development for Torque which, subject to the results of the above Feasibility Study and Permitting, could provide a cash flow to Torque within 6 months of ASX listing.
This Prospectus contains detailed information about Torque and its projects, in addition to independent professional reports. Please read this Prospectus carefully before you make your investment decision and, where necessary, consult your professional advisers.
Prospective investors in the Company should be aware that subscribing for Securities the subject of this Prospectus involves a number of risks. These risks are set in Section 3 of the Prospectus and investors are urged to consider those risks carefully (and, if necessary, consult their professional advisors) before deciding to invest in the Company.
Once again, on behalf of the Board, I invite you to become a shareholder in Torque and thereby be part of this exciting investment opportunity.
Yours sincerely,
Peter McNeil
CHAIRMAN For personal use only use personal For
16 1. DETAILS OF THE OFFER
1.1 Introduction The information set out in this Section is not comprehensive and should be read together with the other information in this Prospectus.
1.2 The Offer and Minimum Subscription Pursuant to this Prospectus, the Company invites applications for up to 20,000,000 Shares at an issue price of 20 cents per Share to raise up to $4,000,000 with a minimum subscription of $3,000,000. Oversubscriptions of up to a further 5,000,000 Shares to raise up to a further $1,000,000 may be accepted.
One free attaching Listed Option exercisable at 30 cents on or before 31 March 2016 will be issued for every one Share subscribed for and issued.
All Shares issued pursuant to this Prospectus will be issued as fully paid ordinary Shares and will rank equally in all respects with the Shares already on issue. The rights attaching to the Shares are summarised in Section 8.4 of this Prospectus.
All Options issued pursuant to this Prospectus will be issued on the terms and conditions set out in Section 8.5 of this Prospectus.
If the minimum subscription of $3,000,000 for the Offer is not achieved within four months of the date of this Prospectus, or such longer period as is permitted under the Corporations Act, the Company will not issue any Securities and will repay all application monies for the Securities within the time prescribed under the Corporations Act, without interest.
1.3 Offer Period The Offer will open on the Opening Date and will remain open until 5.00 pm (WST) on the Closing Date. The Company reserves the right to close the Offer at an earlier time or date or to extend the time or date without prior notice. Applicants are encouraged to submit their Applications as early as possible.
1.4 How to Apply Applications under the Offer may be made, and will only be accepted, in one of the following forms: • on the relevant Application Form accompanying this Prospectus; or • on a paper copy of the relevant electronic Application Form which accompanies the electronic version of this Prospectus, both of which can be found at and can be downloaded from www.torquemining.com.au.
Application Forms must be accompanied by a personal cheque or a bank draft, payable in Australian dollars, for an amount equal to the number of Shares for which the Applicant wishes to apply multiplied by the Application Price of 20 cents per Share. Cheques or bank drafts should be made payable to “Torque Mining Limited Share Account” and crossed “Not Negotiable”. No brokerage or stamp duty is payable by Applicants. The amount payable on Application will not vary during the period of the Offer.
Other than applicants with a shareholding in the Company, applications for Shares must be for a minimum of 10,000 Shares and thereafter in multiples of 1,000 Shares and payment for the Shares must be made in full at the issue price of $0.20 per Share.
Applicants with a shareholding in the Company may apply for that number of Shares that would result in their holding being a minimum of 10,000 Shares and thereafter in multiples of 1,000 Shares and payment for the Shares must be made in full at the issue price of $0.20 per Share.
Applicants should ensure that cleared funds are available at the time the Application is lodged, as dishonoured cheques will result in the Application being rejected. Application monies will be held in trust in a subscription account established and controlled by the For personal use only use personal For Company until the allotment of Securities has taken place.
Completed Application Forms should be delivered or posted to:
Torque Mining Limited Share Issue c/o Computershare Investor Services Pty Ltd GPO Box D182 Perth WA 6840 AUSTRALIA
17 PROSPECTUS
Application Forms must be received at the above address by no later than 5.00pm (WST) on the Closing Date.
Detailed instructions on how to complete paper Application Forms are set out on the reverse of those forms. Applicants are not required to sign the Application Form.
1.5 Allocation and Allotment of Securities and Priority Offer Subject to ASX granting conditional approval for quotation of the Securitiess and the minimum subscription being raised, the allotment of Securities will occur as soon as practicable after the Offer closes. All Securities issued pursuant to the Offer will rank equally in all respects with the existing Shares of the Company. Holding statements will be dispatched as required by ASX. It is the responsibility of Applicants to determine their allocation prior to trading in Securities.
The Directors will determine the allottees of all the Securities in their sole discretion. The Directors will give priority to applications received from shareholders of Frontier registered at the date of this Prospectus over other applicants. In the event of oversubscription the Directors reserve the right to scale back applications at their discretion. The Directors reserve the right to reject any Application or to allot a lesser number of Securities than subscribed for in an Application Form. If the number of Securities allocated is less than that applied for, or no allotment is made, the surplus Application Money will be promptly refunded to the Applicant without interest.
1.6 Sponsoring Broker The Company has engaged Kaz Capital Pty Ltd AFSL: 384738 to exclusively act as Sponsoring Broker to the Offer.
Kaz Capital Pty Ltd will, on a best endeavours basis, facilitate the raising of sufficient funds for completion of the Offer.
Kaz Capital Pty Ltd will be paid a management fee of 2% (excluding GST) of the Maximum Subscription in their role as Sponsoring Broker and a further fee of 6% (excluding GST) of funds raised under the Prospectus through Kaz Capital Pty Ltd.
1.7 Brokerage and Handling Fees Brokerage and/or handling fees on Applications will be payable by the Company to member firms of ASX or licensed investment advisers on such Application Forms bearing their stamp and accepted by the Company.
1.8 Stock Exchange Listing Application will be made to ASX within seven days after the date of this Prospectus for Quotation of the Securities issued pursuant to this Prospectus. If the Securities are not admitted to Quotation within 3 months after the date of this Prospectus, or such longer period as varied by the ASIC, the Company will not issue any Securities and will repay all application monies for the Securities within the time prescribed under the Corporations Act.
The fact that ASX may grant Quotation of the Securities is not to be taken in any way as an indication of the merits of the Company or the Securities now offered for subscription.
1.9 Clearing House Electronic Sub-Register System (CHESS) and Issuer Sponsorship The Company will apply to participate in CHESS, operated by ASX Settlement Pty Ltd (“ASPL”), a wholly owned subsidiary of ASX, in accordance with the Listing Rules and the ASX Settlement Operating Rules.
Under this system, the Company will not issue certificates to investors in relation to their Shares. Instead, Shareholders will receive
a statement of their shareholdings in the Company. For personal use only use personal For If an investor is broker sponsored, ASPL will send them CHESS statements. The CHESS statements will set out the number of Shares allotted to each investor under this Prospectus, give details of the Shareholder’s holder identification number (“HIN”) and give the participant identification number of the sponsor.
Alternatively, if an investor is registered on the issuer sponsored sub register, the statements will be dispatched by the Share Registrar and will contain the number of Shares allotted under this Prospectus and the Shareholder’s security holder reference number (“SRN”).
18 A CHESS statement or issuer sponsored statement will routinely be sent to Shareholders at the end of any calendar month during which the balance of their holding changes. A Shareholder may request a statement at any other time, however a charge may be made for additional statements.
1.10 Overseas Investors This Prospectus does not constitute an offer or invitation in any place in which, or to any person to whom, it would not be lawful to make such an offer or invitation. The distribution of this Prospectus in jurisdictions outside Australia may be restricted by law and persons who come into possession of this Prospectus should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws. Lodgement of a duly completed Application Form will be taken by the Company as constituting a representation that there has been no breach of such laws.
No action has been taken to register or qualify the Securities, or the Offer, or otherwise to permit a public offering of the Securities, in any jurisdiction outside Australia.
The Offer pursuant to an electronic Prospectus is only available to persons receiving an electronic version of this Prospectus within Australia.
1.11 Privacy Act The Company collects information about each Applicant from the Application Form for the purposes of processing the Application and, if the Application is successful, to administer the Applicant’s shareholding in the Company.
By submitting an Application Form, each Applicant agrees that the Company may use the information in the Application Form for the purposes set out in this Prospectus and may disclose it for those purposes to the Share Registrar, the Company’s related bodies corporate, agents, contractors and third party service providers (including mailing houses), ASX, ASIC and other regulatory authorities.
If an Applicant becomes a Shareholder of the Company, the Corporations Act requires the Company to include information about the Shareholder (name, address and details of the Shares held) in its public registers. This information must remain in the registers even if that person ceases to be a Shareholder of the Company. Information contained in the Company’s registers is also used to facilitate distribution payments and corporate communications (including the Company’s financial results, annual reports and other information that the Company may wish to communicate to its Shareholders) and compliance by the Company with legal and regulatory requirements. Successful Applicants may request access to their personal information held by (or on behalf of) the Company by telephoning or writing to the Company Secretary.
If you do not provide the information required on the Application Form, the Company may not be able to accept or process your Application.
1.12 Not Underwritten The Offer is not underwritten.
1.13 Financial Forecasts The Directors have considered the matters set out in ASIC Regulatory Guide 170 and believe that they do not have a reasonable basis to forecast future earnings on the basis that the operations of the Company, being a mineral exploration company, are inherently uncertain. Accordingly, any forecast or projection information would contain such a broad range of potential outcomes and possibilities that it is not possible to prepare a reliable best estimate forecast or projection.
1.14 Investor Enquiries For personal use only use personal For This document is important and should be read in its entirety. If you are in doubt as to the course of action to be followed then you should consult your stockbroker, solicitor, accountant or other professional adviser without delay.
Additional copies of this Prospectus can be obtained from either the Company or the Share Registrar or further advice on how to complete the Application Form can be obtained from the Share Registrar by telephone on 1300 850 505 or +61 (0) 3 9415 4000.
Questions relating to the Offer can be directed to the Company by telephone on +61 (0) 7 5564 8823 or +61 (0) 400 756 628.
19 PROSPECTUS
2. OVERVIEW OF THE COMPANY AND PROJECTS
2.1 Company Background Torque is an Australian based mineral exploration company formed to acquire Frontier’s interest in their Tasmanian Projects.
Frontier is “spinning off” these projects for the following reasons:
• The Tasmanian Projects are regarded by the Directors of Torque as outstanding mineral opportunities. To proceed these opportunities requires focus, and at present Frontier has a strong focus on Papua New Guinea and its joint ventures with OK Tedi and Newcrest. Torque, as a separate entity with its own management, can provide that focus.
• For Frontier to retain the Tasmanian projects would require substantial investment in the near term, such investment, if raised by Frontier, would result in major share dilution.
• The “spin off” has provided a substantial benefit for Frontier shareholders, at little risk, with an in-specie distribution of Torque shares to Frontier shareholders in the ratio of one Torque share for every 10.134889 Frontier shares held.
The Company is focused on developing and exploring for gold throughout the Moina mineral district, with lesser emphasis on other metals at Moina; high-grade silver, lead, zinc, gold in the SMRV Project, tin at Mt Paris, and tungsten and gold in the Lower Pieman Project.
The Company is also focused on bringing the Stormont Indicated Resources to production and a cash flow within 6 months through a Joint Venture and with the assistance of, and using the processing facilities of, BCD Resources NL at Beaconsfield, Tasmania (see agreements).
The Company has title to two exploration and one retention licence at Moina, two exploration licences at SMRV, one exploration licence at Mt Paris and two exploration licences at Lower Pieman.
2.2 Mineral Resources Mineral Resources have been estimated at two prospects in the Moina Project, Stormont and Narrawa, both skarn related deposits. Stormont is a small on and near surface gold-bismuth deposit with excellent potential to increase resources by defining similar targets nearby or under basalt cover. Narrawa is the project name for a number of previously named prospects such as Higgs (Blake, 1937) and Narrawa Reward. Narrawa is a near surface small sized gold, silver, lead, zinc, tungsten and tin system with excellent potential to increase resources in the nearby vicinity of the present resource.
Recent 3DIP and geochemical surveys evaluated with historic aeromagnetic data all strongly suggest that other deposits similar to Stormont and Narrawa will be defined by further exploration. The data also demonstrates a strong possibility of defining large disseminated gold systems and/or replacement type tin and tungsten systems.
The Stormont and Narrawa systems have excellent access, no known environmental restrictions (other than normal environmental requirements) and would be predominantly open pittable.
The combined total Indicated Mineral Resource at the Stormont and Narrawa prospects is 313,600t at 2.49g/t gold plus credits in bismuth, silver, lead and zinc. Contained metal is 25,058ozs gold, 125,811ozs silver, 256t bismuth, 2,311t lead, and 1,953t zinc. Gold equivalent grade of the above total metals is 3.64g/t gold for 36,700ozs gold equivalent. Caution must be exercised when equating all metal values to gold equivalent due to fluctuating metal prices and the uncertainty as to the amount of each metal that can be recovered in the processing of the mineralisation. Metal prices used in this calculation were (all in US$): gold $1,646/oz, silver $31.61/oz, lead $0.94/lb or $2.07/kg, zinc $0.98/lb or $2.16/kg, bismuth $11.00/lb or $24.24/kg. The gold equivalent formula used to calculate the gold equivalent values is as follows: gold equivalent (g/t) equals gold (g/t) + (lead % x
0.3912) + (zinc % x 0.4082) + (silver g/t x 0.0193) + (bismuth % x 4.58). For personal use only use personal For The JORC Code requires a metallurgical recovery be specified for each metal, where possible, and they are 96.7% for gold, 98.5% for zinc, 95.6% for lead and 92.4% for silver. Metallurgical testing re bismuth recovery is in progress and it is still uncertain the amount of bismuth, if any, that can be recovered. It is the Company’s opinion that each of the elements included in the metal equivalents calculation has reasonable potential to be recovered if the project proceeds to mining.
In addition to the total Indicated Mineral Resource there is an Inferred Mineral Resource at Narrawa.
20 The individual project resources from MacDonald (May & April 2009 and April 2012) are:
Stormont - Indicated Mineral Resource of 150,800t at 2.89g/t gold + 0.17% bismuth for 14,011ozs gold + 256.0 tonnes of bismuth (using a cut-off grade of 0.5 g/t gold).
Narrawa - Indicated Mineral Resource of 162,800t at 2.11g/t gold + 1.42% lead + 1.20% zinc + 20.6g/t silver for 11,040ozs gold + 2,311t lead + 1,953t zinc + 107,288ozs silver.
- Inferred Mineral Resource of 46,570t at 2.07g/t gold + 0.98% lead + 0.81% zinc + 16.0g/t silver for 3,100ozs gold + 460t lead + 380t zinc + 23,960ozs silver.
A small Inferred Mineral Resource has been estimated at the Wart Hill Prospect, SMRV Project. The Resource at Wart Hill consists of a combination of massive in-situ, disseminated footwall alteration style sulphide and sulphide clasts in polymict breccias. The close spatial relationship between in-situ, clastic and disseminated sulphide in most drill holes suggests that there is a discrete mineralised zone or horizon which can be traced along strike between drill holes.
A typical Wart Hill intersection consists of disseminated and clastic sulphides in a polymict volcaniclastic unit with included and occasionally stratigraphically overlying bands of massive sulphide.
The resource estimation used Surpac’s inverse squared methodology. A resource was estimated for various gold equivalent cut-off grades ranging from 0g/t gold to 10g/t gold equivalent. Using a cut-off grade of 5g/t gold equivalent gave 167,364t at 1.14g/t gold, 74g/t silver. 0.215% copper, 3.88% lead and 7.7% zinc (gold equivalent grade of 7.12g/t).
The gold equivalent was calculated using the following: gold - $1,592/oz; silver $28.39/oz; copper $3.54/lb; lead $0.881/lb and zinc $0.863/lb, leading to a gold equivalent formula of: gold equivalent (g/t) = [0.0178273 x silver (ppm)] + [0.0001524 x copper (ppm)] + [0.000379 x lead (ppm)] + [0.000372 x zinc (ppm)].
The Resource would need to be substantially increased in size to be economic to develop. Torque believes that with further drilling there is a strong possibility that such an increase in resources will occur.
The statements in this Prospectus that relate to Exploration Results, Mineral Resource and Ore Reserves are based on information compiled by Peter Swiridiuk of Aimex Geophysics Pty Ltd, a Member of the Australian Institute of Geoscientists. Peter Swiridiuk has sufficient experience which is relevant to the styles of mineralisation and types of deposits under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Peter Swiridiuk consents to the inclusion in this Prospectus of these statements in the form and context in which they appear.
2.3 Joint Venture between BCD Resources NL, Frontier Resources Ltd and Torque Mining Ltd for the Mining and Processing of the Stormont Gold Deposit On 9 October 2012 the Company entered into a Joint Venture with BCD Resources NL (“BCD”) and Frontier Resources Ltd (“Frontier”) whereby, subject to a favourable Feasibility Study and Mine Environmental Permitting and grant of a Mining Lease, the Indicated Resource at Stormont will be processed through BCD’s gold processing facility at Beaconsfield, Tasmania.
Although the Scoping Study noted in Section 2.4.3 suggests that the existing resources at Stormont and Narrawa may warrant development by the construction and operation of a processing plant in the Moina District, the Torque Board is of the opinion that this would be a high-risk strategy for Torque at this stage of its history. The Board considers that before a processing plant is built at Moina further resources should be defined.
Consequently, the Board has concluded that in the short term, the best development strategy for Torque is through a financially risk-free (BCD provides all initial funding to production) alliance with BCD, although this means that some of the recovered gold, in excess of expenses, will go to BCD. It is important to realise that Torque will not have to provide any funds, other than from cashflow,
For personal use only use personal For to this venture.
The material terms of the Joint Venture Agreement are as follows:
• The participating interests in the Joint Venture are: BCD (50%), the Company (45%) and Frontier (5%).
• The Joint Venture is restricted to the area of the existing Indicated Resource at the Stormont Deposit and does not include any possible expansion of the Stormont Resource, the Narrawa Resource or other mineral resources that may be defined in the future at the Moina Project.
21 PROSPECTUS
• BCD will provide all funds required to complete a Feasibility Study, obtain permitting for the proposed operation and associated development costs up until production.
• There will be a prepayment to Torque by BCD of AUD$500,000 at the commencement of production, to be repaid to BCD from Torque’s share of cash flow.
• The JV will be directed by a committee voting their respective equities with each decision requiring a simple majority vote.
• BCD will recoup all Joint Venture costs from production proceeds including mining, processing and related direct management costs they incur at their actual cost under an “open book” agreement, with no additional Management Fee charged.
• No party may transfer its participating interest without the prior consent of the other parties who have a pre-emptive right for such transfer.
• The net cash flow to JV participants from all gold sold is based on the actual gold price at the time and after all expenses.
o If the gold price is US$1,700/ounce or less, the cash flow will be split between Torque, Frontier and BCD on their respective 45% - 5% - 50% equity basis.
o If the gold price is greater than US $1,700/ounce, all additional net cash flow from the increased gold price will all revert to Torque and Frontier (pro-rata).
Torque, BCD and Frontier note that this agreement or some modified agreement may be extended to the Narrawa Resource or any other resource defined by Torque at Moina, subject to the mutual agreement by all parties.
2.4 Projects The following summary descriptions of the two main projects, Moina and SMRV, are taken from the Independent Geologist’s Report. Please read this report as it contains considerably more detail than in this section.
Torque is a mineral exploration/development company. The main targeted commodity is gold but the project areas collectively cover a wide range of mineralisation styles and geological settings including gold+/-bismuth+/-base metals in skarn style deposits; gold in disseminations and/or veins associated with intrusive granite (e.g. Pogo and Fort Knox, Canada); high grade zinc+lead+gold+silver in Volcanic Hosted Massive Sulphide style; Tungsten+/-molybdenum+/-bismuth+/-tin in vein or skarn deposits; Tin as disseminations in “greisen” altered granite and/or replacement/skarn tin deposits.
Torque has gold resources, high grade mineralisation, development opportunities and many drill ready targets. Torque’s main projects are advanced with most preliminary exploration, such as geophysics and geochemistry, completed. Torque is not a grass roots exploration company. Torque’s parent company, Frontier, has expended $8.6 million on Tasmanian exploration since 2002.
At Moina, Torque controls a historic multi-metal mineral district with two gold projects at Feasibility Stage - Narrawa and Stormont. Excellent logistics and infrastructure - ideal for development and operations, only 40 km from Devonport. At the SMRV Project high to very high grade massive sulphides have been drill intersected – geology is similar to the large Rosebery mine.
Torque has a major advantage over all previous explorers at Moina in that in late 2011, Frontier spent $600,000 on an electrical geophysical exploration survey, 3 Dimensional Induced Polarisation (3DIP), and the results were an outstanding success. The 3DIP showed that the known gold resources at Stormont and Narrawa could be located using 3DIP and that the 3DIP survey had, in effect, rolled back the surface cover of recent basalt and sediments, and allowed us to view possible undiscovered mineral deposits – both large and small – from near surface to depths of 400-500 metres. Our Consulting Geophysicist has identified more than 70,
(mainly previously unknown), targets that warrant testing by drilling. For personal use only use personal For
22 Figure 1: This figure shows the location of Torque Projects’ simplified geology and major mineral deposits in Tasmania.
2.4.1 Exploration Targets
2.4.1.1 Exploration Targets at the Moina Project are: • Gold-bismuth and gold-pyrrhotite-base metal skarns. This Exploration Target is skarn type mineralisation; individual bodies of mineralisation may vary from approximately 100,000t at 2 to 5g/t gold plus bismuth and/or zinc, lead and silver to 20,000,000t at similar grades.
This Target is based on the exploration results summarised below; the exploration results in Section 3 of the Independent Geologist’s report; the known Stormont and Narrawa mineral bodies, and on the known skarns in the retention licence held by TNT Mines Ltd.
• Intrusive related gold deposits. This Exploration Target is disseminated gold, pyrite, bismuth mineralisation which may have formed within the uppermost parts of the Dolcoath Granite or in the Moina Sandstone immediately above the Granite.
Individual bodies of mineralisation may range from a few million tonnes to hundreds of millions of tonnes at grades of 0.7 to
For personal use only use personal For 1.5g/t gold.
This Target is based on research by Mineral Resources Tasmania, who determined that the Dolcoath Granite is anomalous in gold and bismuth in comparison to granites worldwide (summarised in Section 3.4 of the Independent Geologist’s report); and on the chargeability results of the 3DIP survey which suggest large bodies of pyritic mineralisation may occur within or just above the uppermost contact of the Dolcoath Granite.
Other Exploration Targets may be defined in the future in respect to tungsten, tin, molybdenum, bismuth, lead, zinc, silver with further exploration. At this stage of exploration, there is insufficient data to define such Exploration Targets.
23 PROSPECTUS
In respect to the Exploration Targets above it must be noted that the potential quantities and grades are conceptual in nature, that there has been insufficient exploration to estimate a Mineral Resource (with the exception of the Stormont and Narrawa bodies), and that it is uncertain if further exploration will result in the estimation of Mineral Resources additional to those at Stormont and Narrawa.
2.4.1.2 Exploration Targets at the SMRV Project are: • Massive zinc, lead, silver, gold sulphide This mineralisation is similar to Rosebery, Cue River or Hellyer Mines (or former mines). The minimum sized mineral body in the SMRV environment likely to be economic is estimated at 10Mt at grades of 12 to 20% combined zinc and lead (plus silver and gold credits). The maximum size deposit likely to be defined would be approximately 30Mt at similar grades to the minimum size target. The above tonnages and grades are approximate and no financial study has been completed to more accurately ascertain the minimum tonnes and grade likely to be economic in the SMRV tenements.
This target is based on exploration and drill data, summarised below and described in detail in Section 4 of the Independent Geologist’s report.
• Gold-base metals This is similar to the Henty Mine, north of Queenstown, Tasmania. This Exploration Target is 2Mt to 4Mt at a grade of 10 to 15g/t gold plus credits in lead, zinc and silver. The above tonnages and grades are approximate and no financial study has been completed to ascertain the minimum tonnes and grade required for an economic deposit in the SMRV Project.
Mineralisation similar to the Henty Mine has been intersected in a drill hole in the SMRV Project and relevant exploration results relating to this Target are described in Section 4 of the Independent Geologist’s report.
In respect to the Exploration Targets above, it must be noted that the potential quantities and grades are conceptual in nature, that there has been insufficient exploration to estimate a Mineral Resource (except at the Wart Hill prospect) and that it is uncertain if further exploration will result in the estimation of Mineral Resources additional to those at Stormont and Narrawa.
2.4.2 Moina Project (EL 29/2009 – Cethana; 42/2010 – Stormont or River Lea; RL 3/2005 – Narrawa) (Torque 90%) Moina is Torque’s principal project. Frontier has already completed 134 drill holes totalling 6,144 metres (as at 25th April 2012); extensive geochemical sampling; a large scale 3DIP survey; reprocessed an existing helicopter borne aeromagnetic survey and reviewed earlier electromagnetic and geochemical data collected by previous explorers. Projects are at the development stage and exploration is advanced – the project is not grassroots. Mineral Resources have been estimated at two prospects: Stormont and Narrawa, both skarn related deposits. Stormont is a near surface gold-bismuth deposit with excellent potential to increase resources by defining similar systems nearby or under basalt cover. Narrawa is the project name for a number of previously named prospects such as Higgs and Narrawa Reward. Narrawa is a near surface gold, silver, lead, zinc, tungsten and tin system with excellent potential to increase resources in the nearby vicinity of the present resource.
The Stormont and Narrawa systems have excellent access, no known environmental restrictions (other than normal environmental
requirements) and would be predominantly open pit-able (Figure 2). For personal use only use personal For
24 Figure 2: Cross section 2050 through Stormont resource illustrating the gold grades, near surface nature of the deposit, synclinal nature of host environment, typical drill intersections and proximity to Stormont Thrust Fault.
The combined total Indicated Mineral Resource at the Stormont and Narrawa prospects is 313,600t at 2.49g/t gold plus credits in bismuth, silver, lead and zinc. Contained metal is 25,058ozs gold, 125,811ozs silver, 256t bismuth, 2,311t lead, and 1,953t zinc. Gold equivalent grade of the above total metals is 3.64g/t gold for 36,700ozs gold equivalent.
Caution must be exercised when equating all metal values to gold equivalent due to fluctuating metal prices and the uncertainty as to the amount of each metal that can be recovered in the processing of the mineralisation. The gold equivalent formula used to calculate the gold equivalent values is as follows: gold equivalent (g/t) equals gold g/t plus (lead % times 0.3912) plus (zinc % times 0.4082) plus (silver g/t times 0.0193) plus (bismuth % times 4.58). Metal prices used in this calculation were (all in US$): gold $1,646/ oz, silver $31.61/oz, lead $0.94/lb or $2.07/kg, zinc $0.98/lb or $2.16/kg, bismuth $11.00/lb or $24.24/kg.
In addition to the total Indicated Mineral Resource there is an additional Inferred Mineral Resource at Narrawa of 46,570 t at 2.07g/t gold + 0.98% lead + 0.81% zinc + 16.0g/t silver for 3,100ozs gold + 460t lead + 380t zinc + 23,960ozs silver.
A positive aspect is that many drill holes within or near the known resources have excellent grades and contain significant metals such as tungsten, lead, zinc, silver and molybdenum in addition to gold.
The Moina Exploration and Retention Licences cover 75.75sq kms and have more than 70 defined prospects according to Mineral
Resources Tasmania (MRT). Prospects and licence boundaries are shown on Figure 3. For personal use only use personal For
25 PROSPECTUS
Figure 3: Shows Moina Exploration and Retention licenses, most known prospects and their metal affinities, roads, tracks, rivers and location of Stormont and Narrawa resources.
Mineralisation is related to a major intrusive named the Dolcoath Granite and exhibits, in some parts, classic zonation of metals from tungsten, tin and molybdenum near to the granite to lead, zinc, silver, gold and bismuth more distal from the granite. Geologists with MRT have suggested in print that the granite is a gold exploration target for large disseminated gold deposits such as Pogo and Fort Knox. The Dolcoath Granite crops out in the south central part of the project area and is interpreted to underly it at depths of less than 500m (ie: it underlies much of the project area).
Figure 4 shows the generalised geology that illustrates that Tertiary basalt (much younger than the mineralisation) overlies much of the project area and obscures any possible mineralisation. The thin cover of basalt obscured much of the project area from earlier
prospecting and has prevented discovery of any underlying (but near to surface) mineralisation of any style. For personal use only use personal For
26 Figure 4: Simplified Geology of Moina Project showing the axis of main syncline through the district, prospects, Dolcoath Granite outcrop and Tertiary basalt cover (which obscures mineralisation). The extent of the Dolcoath Granite at depth is also illustrated by the hatched area.
Much of the mineralisation known in the project area is hosted in skarn, or is replacement related; that is, mineralisation that is genetically related to the intrusion of the Dolcoath granite has replaced calcareous sediments or limestone in the sedimentary sequences above the granite contact. Fluids, with mineralisation, are thought to have moved up and outwards from the granite along structures until they encountered such sediments, where they then formed mineral deposits. Thus calcareous sediments, limestone (and similar rocks) plus deep penetrating structures (conduits for mineralisation) are all very important in the exploration process at Moina.
In addition to the resources at Stormont and Narrawa, in the central part of the project area, in a small retention licence held by TNT Mines Ltd, is a large fluorite (plus other metals) skarn called Moina Fluorite Skarn. This deposit, according to TNT Mines prospectus dated 11 November 2011 “is potentially one of the largest undeveloped fluorspar deposits in the world. It contains associated tin, tungsten, zinc, bismuth, molybdenum, magnetite and gold”.
Associated with the Moina Fluorite Skarn and within this Retention Licence (surrounded by Torque’s Licences) is the Shephard and Murphy Mine which according to Collins et al, 1989 is now mined out.
In the northern part of the project area at Bell Mt, alluvial gold has been (and is being) produced on a small scale (production unknown). Potentially gold mineralised conductivity and chargeability anomalies have been defined surrounding the Bell Mt goldfield within Torque’s licences and these are targeted for drill testing in 2013
The 3DIP defines the chargeability, resistivity and conductivity of the sub-surface rock sequence to depths of up to 500m. Chargeability can define disseminated, and in some cases, more semi-massive sulphide accumulations. Conductivity can define massive or semi-massive sulphides. The chargeability results suggest numerous anomalies should be tested for possible larger
accumulations of pyrite and perhaps associated gold. Figure 6 is a cross section along line 4590E and shows a major chargeability For personal use only use personal For anomaly (red) dipping shallowly to the north from the Narrawa area. This anomaly is thought to occur within the uppermost part of the Dolcoath granite (perhaps a greisenised zone) or in the Moina Sandstone immediately above the granite.
In the Stormont-Fletchers-Ti Tree Creek area (Figure 5) the 3DIP has effectively peeled off the thin (~20m) layer of basalt with the three previously known Stormont “look-alike’s” i.e. Western Syncline, Far West and Eastern Syncline, now joined by some 40 predominantly north-northwest trending conductivity anomalies that possibly represent further Stormont or possibly much larger
27 PROSPECTUS
deposits. In the Narrawa Creek valley west-northwest trends predominate. Here the Narrawa orebody can be seen to lie in the Higgs conductive trend (Figures 7 and 8) with a number of parallel analogous conductive trends also defined by the 3DIP. Some of these parallel trends have anomalous gold+/-base metals in the few holes drilled to date; other analogous trends remain completely undrilled.
Figure 5: Conductivity anomalies in the immediate Stormont area. Note that the Stormont resource outline at surface closely corresponds to the Stormont conductivity anomaly. The figure shows the many Stormont “look alike” anomalies any of which could host Stormont style mineralisation. The cross hatched area shows basalt cover which effectively prevents any mineralisation beneath this area from outcropping.
Geochemical soil anomalism, particularly in the eastern Moina area from Tin Spur to just west of Narrawa, has been successful in defining the mineral zoning relating to the Dolcoath Granite; known gold, tungsten mineralisation; and together with the 3DIP data confirms the high prospectivity of this belt. Gold anomalous geochemistry essentially reflects the gold mineralisation at Narrawa and has a high correlation with conductivity anomalism at Narrawa. Adjacent to Round Mt, conductivity and lead mineralisation and soil anomalism also have a high correlation.
In summary, the 3DIP data (chargeability and conductivity) magnetics and soil anomalism provide very potent indicators for further sulphide/skarn mineralisation; disseminated gold mineralisation; extensions to existing resources for gold and possibly base metals, tin, tungsten and molybdenum.
The Moina Project has excellent access and mainly moderate topography, in comparison to much of Tasmania. It is well serviced by a network of sealed (blacktop) and graded roads plus forestry tracks. There are no particular environmental or aboriginal heritage
aspects that are likely to prevent mining. For personal use only use personal For
28 Figure 6: 3DIP chargeability section along grid 4590, Moina Project. These chargeability anomalies dip to the north from the All Nations area to east of the Bell Mt Goldfield and possibly represent disseminated pyrite above, near or within the upper surface of the Dolcoath Granite. The anomalies appear to be related to the Hugo and Machinery Creek thrusts, which may also have been the conduits for the introduction of mineralisiation fluids.
Figure 7: Conductivity anomalies in the Narrawa area showing relationship of Narrawa resource to the Narrawa conductivity anomaly
(close correlation). Also shown are individual gold occurrences at Narrawa. For personal use only use personal For
29 PROSPECTUS
Figure 8: Section through Higgs – Narrawa Reward prospects showing the extent of the conductivity anomaly at depth and the untested nature of the Narrawa Reward side. This is a prime target to increase the overall resource at Narrawa. The conductivity anomaly below the Hugo Thrust may represent an extension of the Hugo Skarn deposit into Torque’s tenement.
2.4.3 Scoping Study for Narrawa and Stormont Deposits Torque commissioned Swain Engineers in June 2012 to carry out a Scoping Study in respect to mining and processing the Indicated Resources at Narrawa and Stormont. Swain Engineers made the following recommendations:
“This Scoping Study indicates the potential of a satisfactory investment which will yield a future source of income to the shareholders of Torque Mining Limited. We recommend that a Full Feasibility Study commences without delay.”
The Study was completed by David Swain of Swain Engineers. David Swain is a Fellow of the AustIMM, is a competent person as defined by the JORC Code and consents to the publication of this Study.
2.4.4 SMRV Project EL 20/96 – Elliott Bay; EL 33/2010 – Wanderer River (Torque 90%) The SMRV (Southern Mount Read Volcanics) Project is located in Tasmania’s southwest and contains a 45km strike extension of the Mt Read Volcanics (MRV). Figure 9 shows geology of the SMRV Project, prospects and area covered by the recent VTEM survey.
Major mineralised systems occur in the northern section of the MRV as shown in Figure 1. This mineralisation was formed by ancient analogs of todays “black (and white) smokers” on the seafloor, forming sulphide chimneys from metal rich hydrothermal fluids onto the seafloor or reacting and altering the rocks beneath the seafloor and precipitating mineralisation here. This style of mineralisation is categorized as Volcanic Hosted Massive Sulphides (VHMS). Orebodies of hybrid VHMS-porphyry or VHMS-epithermal style are also present in the Mt. Read Volcanics.
Research (both academic and industry) has recognized that these deposits and the other smaller examples (Que River, Fossey, For personal use only use personal For Mt Charter, Pinnacles/Browns Tunnel, Hercules, Henty and Tasman and Crown Lyell Extended) lie on the same time-stratigraphic horizon, meaning they are all formed on or below the seafloor at approximately the same time. This horizon is known colloquially as the “Holy Host” horizon and is actively pursued by explorers elsewhere in the Mt. Read Volcanics.
30 Figure 9: Geology, tenements, prospects and VTEM survey boundary within the SMRV project. Note the “Holy Host” horizon is considered to extend throughout the length of the tenements.
For personal use only use personal For Drilling by Frontier has shown the host sequence to the Wart Hill massive sulphide deposit to have many geological similarities to the “Holy Host” sequence much further north in the MRV. In fact in excess of 30 prospects have been defined within the SMRV tenement area by this historical work. Exploration at Elliott Bay by Frontier has defined very high grades of zinc, lead, silver and gold.
31 PROSPECTUS
Outcrops of mineralisation in two adjacent lenses at Wart Hill were as follows:
Lens A - 4.0m grading 17.9% zinc, 10.2% lead, 132g/t silver and 0.60g/t gold. Lens B - 3.0m grading 21.9% zinc, 13.9% lead, 680g/t silver and 0.80g/t gold.
All drill hole results are noted in the Independent Geologist’s Report, with highlights such as:
Hole WD025 - 0.75m from 157.1m to 157.85m down-hole grading 28.6% zinc, 14.6% lead, 1.04g/t gold, 48g/t silver and 0.89% copper. - 0.75m from 159.85m to 160.6m down-hole grading 27.4% zinc, 12.8% lead, 4.9g/t gold, 75g/t silver and 1.39% copper. - 7.1m from 163.9m to 171.0m down-hole, grading 11.18% zinc, 5.58% lead, 1.48g/t gold, 58g/t silver and 0.35% copper.
Hole WH8 - 1.1m from 184.85m to 185.95m down-hole grading 23.6% zinc, 10.4% lead, 0.63g/t gold, 123g/t silver.
Hole WH4 - 1.5m from 84m to 85.5m down-hole grading 12.05% zinc, 6.70% lead, 0.90g/t gold, 168g/t silver.
Figure 10: Long section Wart Hill silver zinc lead prospect, SMRV Project. The best hole was WDO25 and mineralisation is open down plunge to the north and south.
The potential at depth is promising, particularly down plunge to the south from the massive high grade pod intersected by WD025, whilst the high grade intersection in WH8 remains open down plunge to the north. Figure 10 is a long section of the Wart Hill mineralisation showing the extent of massive sulphides and drill hole piercement points. Figure 11 compares the known long section of mineralisation at Wart Hill with the published mirror imaged long section for the Rosebery Deposit. Note the discontinuous nature of the mineralisation at Rosebery and based on this comparison, exploration at Wart Hill is justified to the north and south of the known mineralisation.
Extensive gold in streams and soil anomalism have led to the discovery of the Sassy Creek prospect along strike from the Wart Hill For personal use only use personal For massive sulphide deposit to the southwest. A single intersection of base metal + free gold stringers e.g. 3m at 17.5g/t gold, 12.7 g/t silver, 4.5% lead and 4.0% zinc occurs in a large hydrothermal alteration system similar to the Henty - Mt Julia high-grade gold system located in the northern section of the MRV.
The Thirkell Hill part of the belt has seen little of the attention given to Elliott Bay since the Wart Hill discovery with only a few short drill holes drilled into two anomalies. This is in spite of the presence of favourable VHMS style alteration, anomalous gold and base metals in streams and soils and numerous early generation geophysical anomalies. A major impediment has been the lack of outcrop with the volcanics under swampy, peaty soil and thick bush.
32 Figure 11: Mirror image of long section of Rosebery Mine orebody with Wart Hill mineralisation superimposed. Note the zonal or “poddy” nature of the Rosebery silver, zinc, lead mineralisation which is significant in assessing similar mineralisation at Wart Hill. This figure illustrates the untested potential and the extensive, so far untested areas at depth and along strike from the known Wart Hill mineralisation. It is important to realise that the orebody at Rosebery is not one continuous or homogeneous body.
2.5 Programme, Development Strategy and Budgets Torque’s development/exploration strategy will initially focus on gold with lesser emphasis on base metals, tin and tungsten. Torque will focus on bringing to gold production the Indicated Resources at Stormont and Narrawa Prospects to provide a cash flow within 6 months of the IPO. This may be by Torque developing a “stand alone” processing operation at Moina or by way of an association with a nearby existing processor.
Torque will acquire from Frontier three diamond core rigs and ancillary excavators, crawlers, trucks etc., (including a “truly man portable” rig which is easily moved into difficult areas and has minimum environmental impact). Most non-drill type exploration has been completed on these projects and the great majority of funds raised will go directly to drilling. Torque plans a continuous and ongoing drill program both to add to the resource base and to locate further mineralised systems.
2.5.1 Moina Project At Moina, Torque will immediately focus on completion of a Feasibility Study and application for Mining Leases re the Stormont and Narrawa Indicated Resources, within in its own right, and/or in partnership with an existing gold processor; complete a detailed review of the geophysical and geochemical data to further define priorities in respect to drill targets; drill test for similar systems to the Stormont and Narrawa systems, as defined in the conductivity in the conductivity data; drill the larger chargeability anomalies to test for large, disseminated gold systems such as Fort Knox and Pogo; move to gold production as soon as it is practical.
For details of the Torque/BCD Agreement please refer to Material Contracts in this Prospectus. For personal use only use personal For
2.5.2 SMRV Project At the SMRV Project Torque plans to continue and complete a review of all previous exploration prior to determining drill targets in Year two of the program. This will include geochemical, geophysical and geological data for both the Wanderer River and Elliott Bay tenements. Torque will also explore the possibility of bringing in a Farm-In partner in Year two of the program.
In Year one exploration is expected to include geological mapping to further explore possible “vectors” to mineralisation and 3DIP in selected areas of both the Wanderer River and Elliott Bay tenements.
33 PROSPECTUS
In year two, drill testing is proposed on targets confirmed in year one, and although at this stage it is expected that, among other targets, the down pitch zone at Wart Hill and the conductivity and geochemical anomalies immediately south of Wart Hill will be targeted.
2.5.3 Mt Paris Tin Project The Mt Paris area is considered to be a major source area for much of the alluvial tin produced from Northeast Tasmania. Torque’s exploration program in year one will focus on determining whether major, primary tin mineralisation within granitic rocks is a viable target. In particular, Torque will focus on the part of the Mt Paris area that is partly obscured by Mathinna sediments, to determine if significant primary tin remains “in place” beneath these sediments.
Exploration in year one will focus on determining if geochemical sampling can “see through” the overlying sediments, plus geological mapping, and if results are considered positive drill testing will be scheduled for year two.
2.5.4 Lower Pieman Projects The Lower Pieman Projects, at this stage in Torque’s development, are low priority, but still considered to have excellent potential to host major tungsten and possibly gold systems.
Year one exploration program will be focused on reviewing all available data, geological mapping and some surface sampling.
Subject to the results of the Year one program it is expected that defined mineralised systems will be drill tested in Year two. For personal use only use personal For
34 2.5.5 Development/Exploration Budgets Minimum Subscription Full Subscription Over Subscription $3,000,000 $4,000,000 $5,000,000 $AUD $AUD $AUD $AUD $AUD $AUD Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Moina Project Feasibility Studies - - 40,000 40,000 100,000 200,000 Data Review 30,000 - 30,000 - 30,000 - Drilling – replicas of Stormont / Narrawa & Extensions of resources 400,000 300,000 300,000 300,000 300,000 300,000 Drilling – large disseminated gold / tin systems 213,000 113,000 130,000 130,000 280,000 280,000 Tenement Environmental/ Management 10,000 10,000 10,000 10,000 10,000 10,000 Capital - - 250,000 - 250,000 - TOTAL $653,000 $423,000 $760,000 $480,000 $970,000 $790,000
SMRV Project Data Review 20,000 - 50,000 - 50,000 - 3DIP Survey 200,000 - 250,000 - 300,000 - Drilling - 200,000 - 300,000 - 480,000 Tenement Environmental/ Management 10,000 10,000 10,000 10,000 10,000 10,000 Capital 50,000 - 50,000 - 50,000 50,000 TOTAL $280,000 $210,000 $360,000 $310,000 $410,000 $540,000
Mt Paris Tin Project Geochemical sampling & geological mapping - - 200,000 - 200,000 - Drilling - - - 200,000 - 200,000 Tenement Environmental/ Management - - 5,000 5,000 5,000 5,000 TOTAL - - $205,000 $205,000 $205,000 $205,000
Lower Pieman Project Review of data - - 30,000 - 30,000 - Geological mapping - - 20,000 - 20,000 - Geochemical supply - - 10,000 - 10,000 - Tenement Environmental/ Management - - 5,000 5,000 5,000 5,000 Drilling - - - 100,000 - 100,000 TOTAL - - $65,000 $105,000 $65,000 $105,000
GRAND TOTAL $933,000 $633,000 $1,390,000 $1,100,000 $1,650,000 $1,640,000 For personal use only use personal For
35 PROSPECTUS
3. RISK FACTORS
3.1 Introduction THE RISKS CONTAINED BOTH IN THE INVESTMENT OVERVIEW SECTION AND THIS SECTION 3 SHOULD BE CONSIDERED CAREFULLY BY POTENTIAL INVESTORS.
The Securities offered under this Prospectus should be considered speculative because of the nature of the commercial activities of the Company. Whilst the Directors commend the Offer, potential investors should be aware that an investment in the Company involves risks, which may be higher than the risks associated with an investment in other companies.
There are numerous widespread risks associated with investing in any form of business and with investing in the share market generally. There is also a range of specific risks associated with the Company’s activities and its involvement in the exploration industry. These risk factors are largely beyond the control of the Company and its Directors because of the nature of the proposed activities of the Company.
Persons considering whether or not to invest in the Company should read the whole of this Prospectus in order to fully appreciate such matters and the manner in which the Company intends to operate, before any decision is made to apply for Securities. Prospective investors should consider whether the Securities offered are a suitable investment for them having regard to their own personal investment objectives and financial circumstances and the risk factors set out below. If in any doubt, they should consult with their professional advisers before deciding whether to apply for Securities.
The following, which is not exhaustive, identifies some of the major risks associated with an investment in the Company, of which potential investors need to be aware before making a decision on whether or not to invest in the Securities.
3.2 Key Risks The Key Risks identified in the Investment Overview section of the Prospectus are as follows: • Renewal; • No mining lease; • Reliance on Key Personnel; • Tenement Risk/Contractual Risk; • Exploration/Development Risks; • BCD Resources NL Joint Venture Risk • Resource Estimations; • Future requirements for capital; • Limited History; and • Registered third party interest.
INVESTORS SHOULD NOTE THAT DETAIL RELATING TO THESE RISK FACTORS HAS NOT BEEN REPEATED IN THIS SECTION.
3.3 General General risks associated with investment in the Company may include: • fluctuation of the price at which the Securities trade due to market factors; • price volatility of the Securities in response to factors such as: o additions or departures of key personnel;
For personal use only use personal For o press newspaper or other media reports; and o actual or anticipated variations in the Company’s operating results.
INDUSTRY SPECIFIC RISKS
3.4 Development and Mining Possible future development of mining operations at any of the Company’s projects is also subject to numerous risks. The Company’s operations may be delayed or prevented as a result of weather conditions, mechanical difficulties, shortage of technical expertise
36 or equipment. There may be difficulties with obtaining government and/or third party approvals, operational difficulties encountered with extraction and production activities, unexpected shortages or increase in the price of consumables, plant and equipment, cost overruns or lack of access to required levels of funding.
If the Company commences production, its operations may be curtailed or disrupted by a number of risks beyond its control such as environmental hazards, industrial accidents and disputes, technical failures, unusual or unexpected geological conditions, adverse weather conditions, fires, explosions and other accidents.
The Company’s operations may be adversely affected by higher than anticipated ore treatment costs, worse than anticipated metallurgical conditions, fluctuations in metal prices or lack of availability of smelter capacity.
No assurance can be given that the Company will achieve commercial viability through development of any of its projects.
3.5 Commodity and Currency Price Volatility Commodity prices are subject to influencing factors beyond the control of the Company and can be subject to significant fluctuations. Just some of these influencing factors include: -
• world demand for particular commodities;
• the level of production costs in major commodity producing regions; or
• expectations regarding inflation, interest rates and US dollar exchange rates.
Any significant and/or sustained fluctuation in exchange rates or commodity prices could have a materially adverse affect on the Company’s operations and its financial position.
3.6 Economic General economic conditions, introduction of tax reform, new legislation, movements in interest and inflation rates and currency exchange rates may have an adverse effect on the Company’s exploration, development and production activities, as well as on its ability to fund those activities.
COMPANY SPECIFIC RISKS
3.7 Tenure and Access Mining and exploration tenements are subject to periodic renewal. There is no guarantee that current or future tenements or future applications for production tenements will be approved.
Tenements are subject to numerous State-specific legislation conditions. The renewal of the term of a granted tenement is also subject to the discretion of the relevant Minister. Renewal conditions may include increased expenditure and work commitments or compulsory relinquishment of areas of the tenements. The imposition of new conditions or the inability to meet those conditions may adversely affect the operations, financial position and/or performance of the Company.
3.8 Compulsory Work Obligations Tenements are subject to expenditure and work commitments which must be met in order to keep such tenements in good standing. These commitments may be varied on application by the tenement holder but any such variation is at the sole discretion of the Minister administering the relevant State mining legislation. If no variation is approved, and there is failure to meet the commitments,
this could lead to forfeiture of the tenement. For personal use only use personal For 3.9 Environmental The Tenements are subject to both the relevant State and also Commonwealth laws and regulations relating to environmental matters. Should the Company proceed to development of one or more mines, it could be expected that such developments would have numerous environmental impacts which would require various statutory approvals to be put in place. There is no guarantee that such approvals would be granted. The Company intends to conduct its operations in an environmentally responsible manner and in accordance with relevant legislation. However, the Company is unable to predict the effect of future changes to environmental legislation or policy and the cost effect of such changes on its operations and financial position.
37 PROSPECTUS
4. INDEPENDENT GEOLOGIST’S REPORT
20 December 2012
The Directors Torque Mining Limited PO Box 7792 Gold Coast Mail Centre, Qld 9726
Dear Board Members,
Independent Geologist’s Report on the Mineral Assets of Torque Mining Limited
Aimex Geophysics (Aimex) has been commissioned by Torque Mining Limited (Torque) to provide an Independent Geologist’s Report on Torque’s Tasmanian projects. This report will be included in a prospectus which will be submitted by Torque to the Australian Securities and Investment Commission (ASIC). Torque seeks to list on the Australian Securities Exchange (ASX) to raise funds in order to carry out exploration and development on their mineral properties in Tasmania.
This report is based on information that has been provided by the current tenement holders, technical reports from current and past holders, previous tenement holders, and other relevant published public information relating to the area of interest. A list of the principle sources of information has been included in this report. Aimex has strived to confirm the authenticity, accuracy, and completeness of any technical data that may have been used in the creation of this report. Aimex has not verified the status of tenure or any related access issues, this has been addressed in the prospectus.
This report has been completed in accordance with the rules and regulations outlined by the Assessment and Valuation of Mineral Assets and Mineral Securities for Independent Expert Reports (Valmin Code) and the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Resources (JORC Code).
Based on the definitions provided by the Valmin and JORC Codes, the Moina and SMRV Projects are For personal use only use personal For classified as Exploration Projects, whereas the N.E. Tasmanian Tin Project and Lower Pieman Projects are classified as Early Exploration projects. All the properties are considered to be prospective which will allow Torque to further develop and explore their economic potential; however this is subject to a degree of risk.
1
38 Aimex considers the proposed development and exploration strategy outlined in this report, to be appropriate considering the mineral potential of the projects. The present strategy is sufficient to meet the statutory annual expenditure for the tenements as well as meet any and all costs of the development/exploration program. This Independent Geologist’s Report has been compiled based on information available up to and including the date of this report.
The statements in this Prospectus that relate to Exploration Results are based on information compiled by Peter Swiridiuk of Aimex, a Member of the Australian Institute of Geoscientists. Peter Swiridiuk has sufficient experience which is relevant to the styles of mineralisation and types of deposits under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Peter Swiridiuk consents to the inclusion in this Prospectus of these statements in the form and context in which they appear.
Aimex and its employees are not, nor intend to be, directors, officers or employees of Torque and have no material interest in any of their projects. The relationship with Torque is solely one of professional association between client and independent consultant. The review work and this report are prepared in return for professional fees based upon agreed commercial rates and payment of these fees is in no way contingent on the result of this report.
Yours sincerely
Peter Swiridiuk,BSc (Hons), DipEd, MAIG Principal Aimex Geophysics
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2
39 PROSPECTUS
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40 1. INTRODUCTION ...... 1 1.1 Tenure and Site Visits ...... 2 1.2 Qualifications ...... 2 1.3 Independence ...... 2 1.4 Consents ...... 3 1.5 Property Titles ...... 3 1.6 Data Verification ...... 3 1.6.1 Codes of Practice ...... 3 1.6.2 Information Sources and Assessment Methodology ...... 4 1.6.3 Data Quality ...... 4 2. OVERVIEW OF PROJECTS...... 4 2.1 Moina Project (EL’s 29/2009 – Cethana; 42/2010 – Stormont or River Lea; RL 3/2005 – Narrawa) ...... 4 2.1.1 Mineral Resources ...... 5 2.1.2 Exploration Targets ...... 5 2.1.3 Scoping Study and BCD Resources NL Joint Venture ...... 6 2.1.4 Exploration Summary ...... 6 2.2 SMRV Project EL 20/96 – Elliott Bay; EL 33/2010 – Wanderer River ...... 15 2.2.1 Exploration Targets ...... 16 2.2.2 Exploration Summary ...... 16 2.3 Mt Paris Tin Project ...... 17 2.4 Lower Pieman Project ...... 18 2.5 Development Strategy ...... 18 2.5.1 Moina Project ...... 18 2.5.2 SMRV Project ...... 18 2.5.3 Mt Paris Tin Project ...... 18 2.5.4 Lower Pieman Project ...... 18 3. MOINA GOLD/BISMUTH/BASE METALS/TIN/TUNGSTEN PROJECT (MOINA PROJECT) (90% Torque) ...... 18 3.1 Introduction ...... 18 3.1.1 Mineral Resources ...... 19 3.1.2 Location, Access and Weather ...... 19 3.1.3 Land Status ...... 19 3.2 Previous Exploration And Mining ...... 19 3.2.1 Recent Exploration – Western Moina ...... 20 3.2.2 Recent Exploration – Eastern Moina ...... 21 3.3 Geology ...... 22 3.4 Mineralisation/Mineralisation Models/Exploration Targets ...... 23 3.4.1 GoldBismuth and GoldPyrrhotiteBase Metal Skarns ...... 23 3.4.2 Intrusion – Related Gold Deposits ...... 24 3.4.3 Tin, Tungsten, Fluorite, Gold Deposits ...... 25 3.4.4 Silver/lead/zinc/deposits such as Round Mountain ...... 26 3.5 Frontier Recent Exploration Results And Analysis ...... 26 3.5.1 Aeromagnetics ...... 26 3.5.2 Geochemistry ...... 27 3.5.3 Induced Polarisation ...... 28 3.5.4 Drilling ...... 30 3.6 Stormont Project And Nearby Potential ...... 30 3.6.1 Geology ...... 32 3.6.2 Stormont Resource...... 32 3.6.3 Extensions to Stormont Resource ...... 34
For personal use only use personal For 3.6.4 Further Possible Resources within Stormont Ti Tree Project Area ...... 34 3.7 Narrawa Project And Nearby Potential ...... 37
41 PROSPECTUS
3.7.1 Geology ...... 37 3.7.2 Narrawa (Higgs) Gold, Lead, Zinc, and Silver Resource ...... 37 3.7.3 Resource Extensions ...... 38 3.7.4 Additions to Resource ...... 39 3.7.4.1 West Higgs ...... 41 3.7.4.2 400 Lode ...... 41 3.7.4.3 500 Lode ...... 41 3.7.4.4 600 Lode ...... 41 3.7.4.5 NC04 ...... 41 3.7.4.6 Narrawa Reward ...... 41 3.7.4.7 Packetts ...... 41 3.7.4.8 Squib/Blacks/Poveys – Tungsten/Molybdenum/Bismuth/Tin Potential ...... 41 3.7.4.9 Sayers ...... 42 3.7.5 Interpretation of geophysical results by Aimex Geophysics ...... 42 3.8 Scoping Study For Narrawa And Stormont Deposits ...... 43 3.9 Joint Venture between BCD Resources NL, Frontier Resources Ltd and Torque Mining Ltd for the Mining and Processing of the Stormont Gold Deposit ...... 43 3.10 Bell Mt, Tin Spur and Round Mt Prospects ...... 44 4. SMRV PROJECT ...... 44 4.1 INTRODUCTION ...... 44 4.1.1 Exploration Targets ...... 45 4.1.2 Access and Weather ...... 46 4.1.3 Land Status ...... 46 4.2 Geology ...... 46 4.2.1 Regional Geology ...... 46 4.2.2 Project Geology ...... 46 4.2.2.1 Elliott Bay area ...... 47 4.2.2.2 Wanderer River/Thirkell Hill Area ...... 47 4.3 Mineralisation ...... 48 4.4 Exploration Model(s) ...... 48 4.5 Previous Exploration ...... 49 4.5.1 Exploration and Mining History prior to Frontier ...... 49 4.5.1.1 Elliott Bay Area (EL 20/1996) ...... 49 4.5.1.2 Wanderer River/Thirkell Hill Area (EL 33/2010) ...... 51 4.6 Exploration By Frontier ...... 51 4.7 Prospect Descriptions ...... 53 4.7.1 Wart Hill Massive Sulphide Zone ...... 53 4.7.2 Further Possible Mineralisation South of Wart Hill ...... 55 4.7.3 Sassy Creek/Pleiades Gold Anomalous VHMSStyle Alteration System ...... 56 4.7.4 Wanderer River Prospects (EL 33/2010) ...... 59 5. MT PARIS TIN PROJECT ...... 60 5.1 Exploration History ...... 62 5.2 Conclusions ...... 63 6. LOWER PIEMAN PROJECTS ...... 64 7. DEVELOPMENT/EXPLORATION STRATEGY AND BUDGETS ...... 65 7.1 Moina Project ...... 65 7.2 SMRV Project ...... 65 7.3 Mt Paris Tin Project ...... 65 7.4 Lower Pieman Projects ...... 66 7.5 Development/Exploration Budgets ...... 66 7.6 Budget of Minimum Funds Received ...... 67
For personal use only use personal For 7.7 Opinion on Exploration Program ...... 67 8. SOURCES OF INFORMATION ...... 67 9. GLOSSARY OF TERMS ...... 69
42
Table 1: Major Metallic Mineral Deposits of Tasmania ...... 1 Table 2: Torque’s Tenements in Tasmania ...... 2 Table 3: Gold Values in Dolcoath Granite ...... 25 Table 4: Narrawa Drill Results Illustrating Multi Metal Occurrences ...... 28 Table 5: Drill Holes and Assays Used in Stormont Resource Estimation ...... 33 Table 6: Channel Samples/Assays Used in the Stormont Resource Estimation ...... 34 Table 7: TiTree (Stormont) Area Conductivity/Chargeability Anomalies ...... 35 Table 8: Drill Holes, Channels and Assays Used in Narrawa Resource Estimation ...... 38 Table 9: Narrawa Area Conductivity/Chargeability Anomalies ...... 42 Table 10: Wart Hill Prospect – Geopeko Drilling Results ...... 49 Table 11: Wart Hill Prospect – Cyprus Drilling Results ...... 50 Table 12: Wart Hill Prospect – Fimiston Drilling Results ...... 51 Table 13: Drill Hole Results – Wart Hill/Elliott Bay ...... 57 Table 14: Prospects in Wanderer River Licence ...... 60 Figure 1: Location of Torque Projects, Tasmania ...... 3 Figure 2: Moina Exploration and Retention Licences ...... 7 Figure 3: Google Earth Image – Moina Project...... 7 Figure 4: Simplified Geology – Moina Project ...... 8 Figure 5: Bell Mt Alluvial Goldfield ...... 9 Figure 6: 3DIP Narrawa/Bell Mt Zone – Chargeability 50m (above) and 150m (below) depth Slice ...... 10 Figure 6A: 3DIP, Narrawa /Bell Mt Zone Conductivity 50m (above) and 150m (below) depth Slice ...... 11 Figure 7: Total Magnetic Intensity – Moina Project ...... 12 Figure 8: First Vertical Derivative Aeromagnetic Image Moina Project ...... 12 Figure 9: Soil Gold, Bismuth, Molybdenum Anomalism – Narrawa to Tin Spur ...... 13 Figure 10: Soil Tin and Tungsten Anomalism – Narrawa to Tin Spur ...... 13 Figure 11: 3DIP Chargeability Section – Grid 4590 East, Moina Project ...... 14 Figure 12: Conductivity Anomalies – 50m Depth Slice, Moina Project ...... 14 Figure 13: Conductivity Anomalies/Lead Soil Anomalism at Round Mt ...... 15 Figure 14: Geology, Tenements, Prospects and VTEM Survey Boundary – SMRV Project ...... 16 Figure 15: Conductivity Anomalies 75m Depth Slice, Stormont Area ...... 27 Figure 15A: Detailed Aeromagnetic Image of Stormont Area ...... 27 Figure 16: Stormont Resource Grade Plan Projected to Surface ...... 31 Figure 17: Cross Section 2050 through Stormont Resource ...... 31 Figure 18: Stormont Conductivity Cross Section – 5405825N ...... 35 Figure 19: Narrawa Resource Grade Plan Projected to Surface ...... 38 Figure 20: Conductivity Anomalies 75m Depth Slice, Narrawa Area ...... 40 Figure 21: Conductivity Section Through Higgs – Narrawa Reward ...... 40 Figure 22: Conductivity Anomalies 50m Depth Slice Surrounding Bell Mt Goldfield ...... 44 Figure 23: Chargeability Anomalies, 75m Depth Slice, Bell Mt Goldfield ...... 44 Figure 24: Long Section Wart Hill Prospect – SMRV Project ...... 53 Figure 25: Long Section (Mirror Image) Rosebery Mine Orebody ...... 54 Figure 26: SWIR Samples of Alteration in Drill Core, Wart Hill South ...... 56 Figure 27: VTEM Anomalous Zone, Wart Hill South ...... 56 Figure 28: Mt Paris Tin Project ...... 60 Figure 29: Lower Pieman Project ...... 64
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43 PROSPECTUS
The purpose of this report is for inclusion in the Torque Mining Ltd (Torque) prospectus in order to raise AUD$4 million. All relevant consents have been obtained and the author is a competent person in accordance with the language required in the JORC Code.
Torque has acquired the interests of Frontier Resources Ltd (Frontier) in Tasmania, namely EL’s 42/2010, 20/1996, 33/2010, 27/2011, 29/2009, 6/2011, 21/2011 and RL 3/2005. Consideration to Frontier was the issuance of 40 million Torque shares and a 10% carried interest to bankable feasibility in all tenements except EL’s 20/96 and 33/2010. Approximately 30 million of Frontier’s shares in Torque are expected to be distributed by in specie distribution to Frontier shareholders.
Peter Swiridiuk (PS) for Aimex Geophysics has been retained by the board and management of Torque to review all relevant information available, in order to prepare an Independent Geologists’ Report on Torque’s Tasmanian development and exploration properties.
Torque is a mineral exploration/development company planning to list on the ASX. It intends to engage in the exploration for and, subject to proposed feasibilities studies, the development of, and mining of mineral deposits in Tasmania.
Targeted commodities are many as the project areas collectively cover a wide range of mineralisation styles and geological settings. Specific opportunities are:
in skarn style deposits associated with intrusive granites (e.g. current resources at Stormont and Narrawa Creek) Moina Project in disseminations and/or veins associated with intrusive granite (e.g. Pogo and Fort Knox, Canada) Moina Project High grade in Volcanic Hosted Massive Sulphide style (e.g. Rosebery, Hellyer and Mt Lyell, Tas.) – SMRV and Moina Projects; in vein or skarn deposits (e.g. Shephard and Murphy, King Island and Kara, Tas.) – Moina, Lower Pieman and NE Tasmania Projects. as disseminations in "greisen" altered granite and/or replacement/skarn tin deposits (e.g. Mt Bischoff and Renison, Tas.) – Moina, NE Tasmania and Lower Pieman Projects.
These Tasmanian projects were previously held by Frontier Resources Ltd (Frontier), an Australian Securities Exchange (ASX) listed company and were transferred to a wholly owned subsidiary Torque Mining Ltd in May 2012. Frontier and its predecessors have explored the SMRV Project since 1997 and the Moina Project since 2002 and recently acquired the Lower Pieman and NE Tasmania Projects. . In addition Frontier’s “parent”, Macmin (or JV partners) spent approximately $1.2 million between 1993 and 2002.
Beaconsfield Structurally controlled/veins Au Mt Lyell Volcanic Hosted Disseminated Cu, Au Rosebery Volcanic hosted massive sulphide Zn, Pb, Ag, Cu, Au Hellyer Volcanic hosted massive sulphide Zn, Pb, Ag, Cu, Au Que River Volcanic hosted massive sulphide Zn, Pb, Ag, Cu, Au
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44 Henty Volcanic hosted gold Au Renison Bell Skarn Sn Mt Bischoff Skarn Sn Cleveland Skarn Sn Queen Hill Skarn Sn King Island Skarn W Kara Skarn W Avebury Skarn Ni Lisle Disseminated intrusion related Au Mathinna, Mangana, Structurally controlled veins Au Waterhouse
The above mines and/or mineral deposits are included here for reference only to illustrate that Tasmania has large mineral deposits and an ongoing mining industry. Torque emphasises that it has no interest in any of these deposits and none of the deposits are adjacent, or near to any of Torque’s tenements.
EL 29/2009 Cethana 64 13/9/10 EL 42/2010 River Lea or Stormont 9 3/4/11 RL 3/2005 Narrawa 3 12/5/06 EL 20/96 Elliott Bay 11 10/4/97 EL 33/2010 Wanderer River 210 29/3/11 EL 27/2011 Mt Paris 100 23/11/11 EL 6/2011 Interview River 101 24/11/11 EL21/2011 Pieman River 144 5/12/11
The status and tenure of the tenements and any material documents is dealt with in the Solicitor’s report and have not been confirmed independently in the preparation of this report. The locations of the tenement boundaries are shown on the project maps accompanying this report and elsewhere in the Prospectus.
The Moina Project area was visited on 19 January 2012. The SMRV Project area was visited for a week in November 2005. In addition PS made several additional visits to Torque’s main operating office at Hagley, Tasmania during 2012.
This report has been prepared by Peter Swiridiuk, BSc(Hons.), Consulting Geophysicist, who graduated from the University of New England in 1990 and who has over 20 years’ experience in diamond, copper, gold and coal exploration. PS is Managing Director for Coppermoly Ltd (resigned January 18 2013 and has consulted to many companies including DeBeers Diamonds, Highlands Pacific Ltd (PNG), ARM (Solomon Islands), Leigh Resources (Solomon Islands), Diamond Ventures (NSW), QLD Department of Main Roads, Caledonian Pacific (NSW and New Caledonia), National Mining Company (Oman), EMED Mining (Cyprus), Citadel (Saudi Arabia), Kings Minerals (Mexico), Papuan Precious Metals (PNG), Velseis (QLD Coal), MacArthur Coal (QLD Coal), Energy Minerals (QLD Coal), Macmin Silver Ltd (NSW), New Guinea Gold Ltd (PNG), Frontier Resources Ltd (PNG and Tasmania), Quintessential Resources Ltd (PNG), Vangold Resources Ltd (PNG), TVI Resources (Philippines) and Coppermoly Ltd (PNG).
At the date of this report, PS does not have, nor has had any relationship with Torque other than as may have occurred as a result of providing consultancy services in the ordinary course of business.
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45 PROSPECTUS
PS has no relevant interest in or any interest in the acquisition or disposal of any securities in Torque. PS has no pecuniary or other interest that could be regarded as being capable of affecting its ability to give an unbiased opinion in relation to the mineral properties of Torque.
PS has not received nor will not receive any pecuniary or other benefits, whether direct or indirect or in connection with the preparing of this report other than normal consultancy fees based on fee time at normal professional rates plus outofpocket expenses.
PS consents to the inclusion of this report in the form and context in which it is included. Apart from that, neither the whole nor any part of this report, nor any references thereto, may be included in or with, or attached to any document, circular, resolution, letter or statement without the prior written consent of PS.
PS has not been involved in the preparation of, nor has authorised or caused the issue of any other part of the Prospectus in which this report has been included.
The legal status of the tenure of the Torque properties (Table 2 and Figure 1) is subject to a separate Solicitor’s report in the Prospectus. Torque’s tenements have not been independently verified by PS. Frontier acquired the rights to the properties through application to Mineral Resources Tasmania (MRT). Table 2 summarises the status of the titles. See also Solicitor’s Report.
Figure 1: Location of Torque Projects, Tasmania
This figure shows the location of Torque Projects in Tasmania. The location of mineral deposits mentioned in Table 1, are also shown together with simplified geology of Tasmania.
The Valmin Code of Australasian Institute of Mining and Metallurgy (AusIMM) provides the guidelines for the preparation of Independent Experts’ reports and the JORC Code for categorization of resources and reserves. This report has been prepared in compliance with these codes. PS is a Member of the Australian Institute of Geoscientists with over fifteen years’ experience on the types of deposits described in this report.
Torque has no beneficial interest in any existing mines or mineral deposits described herein (other than indicated within Torque Projects) and this data for the above existing mines and mined deposits has been sourced from contemporary literature and other sources. PS makes no warranties as to the absolute accuracy of these numbers; they are provided as quoted in the appropriate sources and have not been independently verified.
Under the JORC Code, provision has been made to allow an expert to estimate potential target sizes to provide an opinion as to the potential of a particular mineralised zone. In this report this has been done using three broadly generalised quantitative terms:
For personal use only use personal For large, medium and small. For example:
“Small” is applied where the deposit potential may range up to a few hundred thousand tonnes;
46 “Medium” is applied where the deposit potential may range from small to a few million tonnes; and “Large” is applied where the deposit potential may range from medium to hundreds of million tonnes.
Identification of promising mineralisation potential does not imply any warranties as to confirmation. Considerable further exploration and other work may need to be undertaken in order to carefully evaluate this potential. Depending upon the target mineral type, the target potential has some bearing on the economic potential and therefore provides qualified support for the work required to be done.
Torque Mining Ltd has made available a considerable body of data from the various properties encompassing exploration and other geological work that has been undertaken over many years, both by Frontier and by other parties. Torque Mining Ltd has warranted in writing that to the best of its knowledge all material information has been disclosed fully, accurately and truly to PS. PS has made diligent efforts to check this data from separate sources but provides no warranties in this regard. By its nature this type of report is largely reliant upon the information supplied by the Company.
A glossary of scientific and technical terms has been prepared for this report and is appended to it. All maps used in this report have been based upon Australian standard datum of ADG66. All currency is quoted in AUD dollars.
Torque projects have been explored by different companies using different methodologies intermittently for many years. This means that a variety of techniques have been applied, some effective, some less effective. The exact technique, on occasion, is poorly recorded or simply not recorded at all. This is often the case in exploration in many other parts of the world and is not unique to Tasmania or to Torque’s projects in Tasmania.
In general terms, larger and experienced reputable companies formed the backbone of the earlier exploration in Tasmania with the consequence that the work was by and large high quality for the period in which the work was done and the techniques were diligently applied. Torque and its predecessors have also generally undertaken well thought out and managed programs even within the limitations of less wellendowed resources than their larger corporate predecessors with the consequence that the data they obtained has been good quality as well.
Tasmania, since the late 1800’s, has had for most of that period, a major mining industry with large, coppergold, zincleadsilver tin mines and various large gold and base metal and tungsten mines. The Mt Lyell Mine (approximately 50km N of the SMRV project) is the largest continually operational mine in Australia, producing copper and gold nearly continuously for 100 years (Corbett, 2001).
The location of Torque’s projects and the main mineral deposits in Tasmania are shown on Figure 1 and in Table 1. Torque’s projects have similar geology to most of these deposits, plus substantial indications of mineralisation.
The Moina Project in north central Tasmania is Torque’s principal project having opportunities for immediate development and excellent potential to both add to the overall resource base as well as for new standalone discoveries at depth or beneath basalt cover. It is proposed that the majority of funds raised will be used to further advance the Moina Project. The second major project is the SMRV in Tasmania's southwest with potential for a very high grade polymetallic deposit. A portion of funds raised will be budgeted for advancing this project towards a medium tonnage, high grade discovery.
Torque holds a large strike length (within both SMRV and Moina projects) of the highly prospective Mt Read Volcanics and in particular the targeted "holy host" horizon on (or immediately below) which Mt. Lyell, Hellyer, Rosebery, Que River, Hercules and Henty mines occur. At the Moina Project, Torque has almost complete coverage of a whole mineral province associated with a Devonian granite intruding calcareous sediments. Torque’s exploration titles are summarised in Table 2.
For personal use only use personal For Torque owns 90% (Frontier 10%) of the Moina Project in north central Tasmania.
47 PROSPECTUS
2.1.1 . Stormont is a small on and near surface goldbismuth deposit with excellent potential to increase resources by defining similar targets nearby or under basalt cover. Narrawa is the project name for a number of previously named prospects such as Higgs (Blake, 1937) and Narrawa Reward. Narrawa is a near surface small sized gold, silver, lead, zinc, tungsten and tin system with excellent potential to increase resources in the nearby vicinity of the present resource.
The Stormont and Narrawa systems have excellent access, no known environmental restrictions (other than normal environmental requirements) and would be predominantly open pittable. Caution must be exercised when equating all metal values to gold equivalent due to fluctuating metal prices and the uncertainty as to the amount of each metal that can be recovered in the processing of the mineralisation. The gold equivalent formula used to calculate the gold equivalent values is as follows: gold equivalent (g/t) equals gold (g/t) + (lead % x 0.3912) + (zinc % x 0.4082) + (silver g/t x 0.0193) + (bismuth % x 4.58). Metal prices used in this calculation were (US$): gold $1,646/oz, silver $31.61/oz, lead $0.94/lb or $2.07/kg, zinc $0.98/lb or $2.16/kg, bismuth $11.00/lb or $24.24/kg.
The JORC Code requires a metallurgical recovery be specified for each metal, where possible, and they are 96.7% for gold, 98.5% for zinc, 95.6% for lead and 92.4% for silver. Metallurgical testing re bismuth recovery is in progress and it is still uncertain the amount of bismuth, if any, that can be recovered. It is the Company’s opinion that each of the elements included in the metal equivalents calculation has reasonable potential to be recovered if the project proceeds to mining.
In addition to the total Indicated Mineral Resource there is an Inferred Mineral Resource at Narrawa.
The individual project resources from MacDonald (May & April 2009 and April 2012) are: Stormont Indicated Mineral Resource of 150,800t at 2.89g/t gold + 0.17% bismuth for 14,011ozs gold + 256.0 tonnes of bismuth (using a cutoff grade of 0.5 g/t gold).
Narrawa Indicated Mineral Resource of 162,800t at 2.11g/t gold + 1.42% lead + 1.20% zinc + 20.6g/t silver for 11,040ozs gold + 2,311t lead + 1,953t zinc + 107,288ozs silver.
Inferred Mineral Resource of 46,570t at 2.07g/t gold + 0.98% lead + 0.81% zinc + 16.0g/t silver for 3,100ozs gold + 460t lead + 380t zinc + 23,960ozs silver. Representative results are shown below and all results used in the resource estimates and historic results are shown in Sections 3.6 and 3.7 and Tables 5, 6 and 8.
Exploration targets have been defined as follows:
This Exploration Target is skarn type mineralisation; individual bodies of mineralisation may vary from approximately 100,000t at 2 to 5g/t gold plus bismuth and/or zinc, lead and silver to 20,000,000t at similar grades.
For personal use only use personal For This Target is based on the exploration results summarised below; the exploration results in Section 3 of this report; the known Stormont and Narrawa mineral bodies, and on the known skarns in the retention licence held by TNT Mines Ltd.
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This Exploration Target is disseminated gold, pyrite, bismuth mineralisation which may have formed within the uppermost parts of the Dolcoath Granite or in the Moina Sandstone immediately above the Granite.
Individual bodies of mineralisation may range from a few million tonnes to hundreds of millions of tonnes at grades of 0.7 to 1.5g/t gold.
This Target is based on research by Mineral Resources Tasmania, who determined that the Dolcoath Granite is anomalous in gold and bismuth in comparison to granites worldwide (summarised in Section 3.4 of this report); and on the chargeability results of the 3DIP survey which suggest large bodies of pyritic mineralisation may occur within or just above the uppermost contact of the Dolcoath Granite.
Other Exploration Targets may be defined in the future in respect to tungsten, tin, molybdenum, bismuth, lead, zinc, silver with further exploration. At this stage of exploration, there is insufficient data to define such Exploration Targets.
In respect to the Exploration Targets above it must be noted that the potential quantities and grades are conceptual in nature, that there has been insufficient exploration to estimate a Mineral Resource (with the exception of the Stormont and Narrawa bodies), and that it is uncertain if further exploration will result in the estimation of Mineral Resources additional to those at Stormont and Narrawa.
Torque commissioned Swain Engineers in June 2012 to carry out a Scoping Study in respect to mining and processing the Indicated Resources at Narrawa and Stormont. Swain Engineers made the following recommendations:
“This Scoping Study indicates the potential of a satisfactory investment which will yield a future source of income to the shareholders of Torque Mining Limited. We recommend that a Full Feasibility Study commences without delay.”
The Moina Exploration and Retention Licences cover 75.75 km2 and have more than 70 defined prospects according to Mineral Resources Tasmania (MRT). Prospects and licence boundaries are shown on Figure 2. Mineralisation is related to a major intrusive named the Dolcoath Granite and exhibits, in some parts, classic zonation of metals from tungsten, tin and molybdenum near to the granite to lead, zinc, silver, gold and bismuth more distal from the granite. Geologists with MRT have suggested in print that the granite is a gold exploration target for large disseminated gold deposits such as Pogo and Fort Knox (Morrison et al, 2003). The Dolcoath Granite crops out in the south central part of the project area and is interpreted to underlie it at depths of less than 500m, i.e.: it underlies much of the project area. Figure 3 shows a Google earth image of the project area and Figure 4, the generalised geology that illustrates that Tertiary basalt (much younger than the mineralisation) overlies much of the project area and obscures any possible mineralisation.
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49 PROSPECTUS
Figure 2: Moina Exploration and Retention Licences Shows Moina Exploration (EL’s 29/2009, 42/2010) and Retention Licences (RL 2005), most known prospects and their metal affinities, roads, tracks, rivers and location of Stormont and Narrawa resources. The central grey area which hosts the Moina Skarn deposit is a small Retention Licence held by TNT Mines Ltd. Torque has no interest in this Retention Licence.
Figure 3: Google Earth Image – Moina Project
Google Earth image of Moina Project showing roads, vehicular tracks (excellent access to prospects), main known prospects, project licence boundary (excludes the Moina Fluorite Skarn, Shepherd and Murphy and Hugo Skarn), water resources and access to power. This figure illustrates the excellent logistics of the Moina Project.
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Figure 4: Simplified Geology – Moina Project Simplified Geology of Moina Project showing the axis of the main syncline through the district, prospects, Dolcoath Granite outcrop and Tertiary basalt cover (which obscures mineralisation). The extent of the Dolcoath Granite at depth is also illustrated by the hatched area
Much of the mineralisation known in the project area is hosted in skarn, or is replacement related; that is, mineralisation that is genetically related to the intrusion of the Dolcoath granite has replaced calcareous sediments or limestone in the sedimentary sequences above the granite contact. Fluids, with mineralisation, are thought to have moved up and outwards from the granite along structures until they encountered such sediments, where they then formed mineral deposits. .
The deposits noted below within a small Retention Licence (RL) held by TNT Mines Ltd (in the central part of Figures 2 and 4 Torque has no interest in these mineral deposits), including the Moina Fluorite Skarn, Shephard and Murphy Mine and Hugo Skarn are noted as they, and other former mines in the Round Mt area (held by Torque), and the current Stormont and Narrawa Resources are material to an understanding of the Exploration Targets and the potential of the Moina district.
In the central part of the project area, in a small Retention Licence held by TNT Mines Ltd, occurs a large fluorite (plus other metals) skarn called Moina Fluorite Skarn. This deposit, according to TNT Mines prospectus dated 11 November 2011 “is potentially one of the largest undeveloped fluorspar deposits in the world. It contains associated tin, tungsten, zinc, bismuth, molybdenum, magnetite and gold.” Further, according to the above prospectus: “the deposit contains two styles of mineralisation – replacement skarn and fissure veins.”
Associated with the Moina Fluorite Skarn and within this Retention Licence (and less than one kilometre from Torque’s licences) are two medium sized deposits the Shepherd and Murphy Mine (Collins et al, 1989) and the Hugo Skarn, (Newnham, 1997).
Silver and base metals have also been mined to the east of the Narrawa Project at the Round Mountain Mine. Production figures are incomplete and likely understated, but the mine produced 370,000ozs silver, 1,500ozs gold and 4,700t of lead between 1908 and 1927 (Jennings, 1963 and 1965). This does not include production from the associated Claude Hill and nearby smaller operations. In the northern part of the project area at Bell Mt, alluvial gold has (and is) being produced on a small scale (production unknown). Figure 5 illustrates the possible source rocks for the alluvial gold at Bell Mt. Potentially mineralised conductivity and chargeability anomalies surround the Bell Mt. Goldfield within Torque’s tenements (Figure 6 and 6A). In addition to the above modest amounts of gold, base metals, tin and tungsten have been produced from several historic sites.
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51 PROSPECTUS
Figure 5: Bell Mt Alluvial Goldfield
The Bell Mt alluvial goldfield (not held by Torque) has been created by the erosion of and movement of gold from the adjacent rocks within Torque’s license. Chargeability and/conductivity anomalies within Torque’s licenses which may be the source of this alluvial gold will be targeted for drill testing
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Figure 6: 3DIP Narrawa/Bell Mt Zone – Chargeability 50m (above) and 150m (below) depth Slice Note the zone of anomalies stretching from Narrawa to Bell Mt Goldfield. These anomalies possibly represent disseminated pyrite with possible other associated metals in the sub surface some 150m below present surface. The section line represents location of Figure 11.
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53 PROSPECTUS
Figure 6A: 3DIP, Narrawa /Bell Mt Zone Conductivity 50m (above) and 150m (below) depth Slice
Note the NW trending conductivity anomalies including the one which extends through the Moina Fluorite Skarn and Shephard & Murphy Mines (both held by TNT Mines Ltd).
The above examples demonstrate the Moina Project to be extensively mineralised in a range of metals. Aeromagnetic geophysical imagery (Figures 7 and 8), 3DIP geophysics and geochemical surveys (Figures 9 and 10) all suggest the project area has the potential to add to the resource base by extensions to existing deposits or further lookalike repetitions and that new discoveries, major mineralisation, either beneath basalt cover or at greater depths will be defined by ongoing exploration.
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Figure 7: Total Magnetic Intensity – Moina Project Total magnetic intensity aeromagnetic image of Moina Project. The area south of Sayers Prospect is outcropping Dolcoath Granite. The hatched area reflects the granite at less than 500m depth below surface. The main known skarn deposits, Moina Fluorite Skarn, Shepherd and Murphy, Hugo and Stormont are all partly defined by magnetic anomalies.
Figure 8: First Vertical Derivative Aeromagnetic Image Moina Project This image more precisely defines the magnetic features which reflect the known mineral deposits.
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55 PROSPECTUS
Figure 9: Soil Gold, Bismuth, Molybdenum Anomalism – Narrawa to Tin Spur Anomalous gold, bismuth and molybdenum soil geochemistry and geology – Narrawa to Tin Spur area. There is a broad zonation to the anomalism with gold to the north and molybdenum to the south although there is considerable overlap in the immediate Narrawa area.
Figure 10: Soil Tin and Tungsten Anomalism – Narrawa to Tin Spur Anomalous tin and tungsten soil geochemistry and geology Narrawa to Tin Spur area. Note that the tungsten anomalism is zoned in that it is generally closer to the granite than the tin anomalism. The 3DIP geophysical survey in particular has been highly successful defining numerous anomalies in highly favourable geological settings which warrant drill testing. The 3DIP survey had the effect of “peeling back” surface cover rocks such as basalt and define known mineralisation beneath the basalt and also in defining additional targets for mineralisation throughout the entire Moina area at depths from 50 to 500m below surface. The 3DIP measures the chargeability, resistivity and conductivity of the subsurface rock sequence to depths of up to 500m. Chargeability can define disseminated, and in some cases, more semimassive sulphide accumulations. Conductivity can define massive or semimassive sulphides and structures channeling electrical current. The 3DIP produces three dimensional models, For personal use only use personal For from which horizontal “slices” at whatever depths and cross sections are produced as required.
56 The chargeability and conductivity (of the subsurface rocks) at 50m and 150m depth in the Narrawa to Bell Mt area is shown in Figures 6 and 6A. The anomalous chargeability extends from the southeast at Round Mt, through Narrawa to Bell Mt. The chargeability results suggest numerous anomalies should be tested for possible larger accumulations of pyrite and perhaps associated gold. Figure 11 is a cross section along line 4590E and shows a major chargeability anomaly dipping shallowly to the north from just west of Narrawa. This anomaly is thought to occur within the uppermost part of the Dolcoath granite (perhaps a greisenised zone) or in the Moina Sandstone immediately above the granite.
Figure 11: 3DIP Chargeability Section – Grid 4590 East, Moina Project These chargeability anomalies dip to the north from the All Nations area to east of the Bell Mt Goldfield and possibly represent disseminated pyrite above, near or within the upper surface of the Dolcoath Granite. The anomalies appear to be related to the Hugo and Machinery Creek thrusts, which may also have been the conduits for the introduction of mineralising fluids.
Conductivity anomalies accurately define the location of both Stormont and Narrawa resources. In the StormontFletchersTi Tree Creek area the conductivity results (Figures 12 and 15) have effectively “peeled off” the thin (~20m) layer of basalt with the three previously known Stormont “lookalike's” i.e. Western Syncline (T12), Far West (T13) and Eastern Syncline (T14 and T15), now joined by a further 34 predominantly northnorthwest trending conductivity anomalies likely to represent further mineralisation similar to Stormont. Aimex Geophysics (July 2012) in their review of the Stormont – Ti Tree area 3DIP results, defined 38 conductivity anomalies and two chargeability anomalies which they interpreted as warranting exploration followup (see Section 3.6.4).
Figure 12: Conductivity Anomalies – 50m Depth Slice, Moina Project
Conductivity anomalies (blue and dark blue) throughout the Moina Project – 50m below present ground surface. The anomalies in the Stormont, Narrawa, Bell Mt and Tin Spur areas will be the initial anomalies scheduled for drill testing. The outline of the granite at 500m depth and prospects are also shown.
For personal use only use personal For In the Narrawa Creek valley westnorthwest structural trends predominate. Here the Narrawa orebody can be seen to lie in the Higgs conductive trend with a number of analogous parallel conductive trends also defined by the 3DIP (see Section 3.7.5). Some
57 PROSPECTUS
of these parallel trends have anomalous gold+/base metals in the few holes drilled to date; other analogous trends remain completely undrilled. This is the location in which disseminated gold systems would be postulated to occur.
It has been demonstrated that conductivity anomalies define the location of the precious and basemetal mineralisation at Stormont, Narrawa (see Section 3) and Round Mt (Figure 13). By analogy, the many conductivity anomalies defined throughout the entire Moina area, either beneath the basalt cover or at depth may represent additional small to medium (perhaps large) gold/bismuth/base metal systems.
Figure 13: Conductivity Anomalies/Lead Soil Anomalism at Round Mt Conductivity trends with lead soil geochemistry overlay – Round Mt area. Note the close correlation between the Round Mt prospect and a conductivity anomaly. By analogy the much bigger Round Mt Central and Round Mt West conductivity anomaly presents a target for mineralisation.
Geochemical soil anomalism, (Figures 9 and 10) particularly in the eastern Moina area from Tin Spur to just west of Narrawa, has been successful in defining mineral zonation related to the Dolcoath Granite; known gold, tungsten mineralisation; and together with the 3DIP data confirms the high prospectivity of this belt. Gold anomalous geochemistry essentially reflects the gold mineralisation at Narrawa and has a high correlation with conductivity anomalism at Narrawa. Adjacent to Round Mt, conductivity, lead mineralisation and soil anomalism have a high correlation.
The SMRV (Southern Mount Read Volcanics) Project (Figure 14) is located in Tasmania's southwest around the 45km strike extensions of the Mt Read Volcanics (MRV) which outcrops in two windows south of Macquarie Harbour (Corbett, 1992). The northern window between the D'Aguilar Range and the Wanderer River valley, i.e. the Thirkell Hill window, is completely held under EL 33/2010. The southern window lies between the Wanderer River valley and Elliott Bay itself. About half of this window is held under EL's 33/1010 and EL 20/1996. Torque holds 90% in both of these tenements (Exploration and Mining Consultants hold 10%).
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58 Figure 14: Geology, Tenements, Prospects and VTEM Survey Boundary – SMRV Project Note the holy host horizon is considered to extend throughout the length of the tenements.
Exploration Targets have been defined as follows:
This mineralisation is similar to Rosebery, Cue River or Hellyer Mines (or former mines). The minimum sized mineral body in the SMRV environment likely to be economic is estimated at 10Mt at grades of 12 to 20% combined zinc and lead (plus silver and gold credits). The maximum size deposit likely to be defined would be approximately 30Mt at similar grades to the minimum size target. The above tonnages and grades are approximate and no financial study has been completed to more accurately ascertain the minimum tonnes and grade likely to be economic in the SMRV tenements.
This target is based on exploration and drill data, summarised below and described in detail in Section 4 of this report.
This is similar to the Henty Mine, north of Queenstown, Tasmania. This Exploration Target is 2Mt to 4Mt at a grade of 10 to 15g/t gold plus credits in lead, zinc and silver. The above tonnages and grades are approximate and no financial study has been completed to ascertain the minimum tonnes and grade required for an economic deposit in the SMRV Project.
Mineralisation similar to the Henty Mine has been intersected in a drill hole in the SMRV Project and relevant exploration results relating to this Target are described in Section 4 of this report.
In respect to the Exploration Targets above, it must be noted that the potential quantities and grades are conceptual in nature, that there has been insufficient exploration to estimate a Mineral Resource (except at the Wart Hill prospect) and that it is uncertain if further exploration will result in the definition of Mineral Resources additional to those at Stormont and Narrawa.
The Wart Hill massive sulphide deposit (see Section 4.7.1) occurs within EL 20/1996. EL 33/2010 was recently acquired by Frontier and a new generation EM survey (VTEM) flown over both tenements. Figure 14 shows geology of the SMRV Project, prospects and area covered by the recent VTEM survey.
Major mineralised systems occur in the northern section of the MRV as shown in Table 1 and located in Figure 1. This mineralisation was formed by ancient analogs of todays "black (and white) smokers" on the seafloor, forming sulphide chimneys from metal rich hydrothermal fluids onto the seafloor or reacting and altering the rocks beneath the seafloor and precipitating mineralisation here. This style of mineralisation is categorized as Volcanic Hosted Massive Sulphides (VHMS). Orebodies of hybrid VHMSporphyry or VHMSepithermal style are also present in the Mt. Read Volcanics.
Three of the orebodies in the Mt. Read Volcanics qualify as large deposits. i.e. Mt Lyell (copper+gold), Rosebery and Hellyer (polymetallic precious and base metals).
Research (both academic and industry) has recognised that these deposits and the other smaller examples (Que River, Fossey, Mt
Charter, Pinnacles/Browns Tunnel, Hercules, Henty and Tasman and Crown Lyell Extended) lie on the same timestratigraphic For personal use only use personal For horizon, meaning they all formed on or below the seafloor at approximately the same time, ~500 million years ago. This horizon is known colloquially as the "Holy Host" horizon and is actively pursued by explorers elsewhere in the Mt. Read Volcanics.
59 PROSPECTUS
Drilling by Frontier has shown the host sequence to the Wart Hill massive sulphide deposit to have many geological similarities to the 'holy host" sequence much further north in the MRV. If the Wart Hill horizon is the correlate of the "holy host" horizon as understood then the horizon strikes throughout the whole of the SMRV project as shown in Figure 14. The prospectivity of the Mt. Read Volcanics south of Macquarie Harbour has been recognised since the 19th Century though little prospecting activity ventured this far south. Concerted exploration started in the 1970's culminating with the discovery of the Wart Hill massive sulphide deposit as well as high grade gold in base metal stringers at Sassy Creek. In fact in excess of 30 prospects have been defined within the SMRV tenement area by this historical work.
Subsequent exploration at Elliott Bay by Frontier has kept a focus on Wart Hill with mineralisation defined to date notable for some very high grades of zinc, lead, silver and gold, even in comparison with the relatively (worldwide) high grades which typify Tasmanian VHMS deposits.
Outcrops of mineralisation (see also Section 4.7.1) in two adjacent lenses have given results as follows:
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All drill hole and trench results are shown in Tables 10, 11, 12, 13 and 14, with highlights such as:
1.1m from 184.85m to 185.95m downhole grading 23.6% zinc, 10.4% lead, 0.63g/t gold and 123g/t silver.
1.5m from 84m to 85.5m downhole grading 12.05% zinc, 6.70% lead, 0.90g/t gold and 168g/t silver.
The potential along strike from Wart Hill and at depth is highly promising, particularly down plunge to the south from the massive high grade pod intersected by WD025, whilst the high grade intersection in WH8 remains open down plunge to the north. Extensive gold in streams and soil anomalism have led to the discovery of the Sassy Creek prospect along strike from the Wart Hill massive sulphide deposit to the southwest. An intersection of base metal + free gold stringers e.g. 3m at 17.5g/t gold, 12.7 g/t silver, 4.5% lead and 4.0% zinc (drilled down dip of vein) occurs in a large hydrothermal alteration system similar to the Henty Mt Julia highgrade gold system in the northern section of the SMRV. The Thirkell Hill part of the belt has seen little of the attention given to Elliott Bay since the Wart Hill discovery with only a few short drill holes drilled into two anomalies. This is in spite of the presence of favourable VHMS style alteration, anomalous gold and base metals in streams and soils and numerous early generation geophysical anomalies. A major impediment has been the lack of outcrop with the volcanics under swampy, peaty soil and thick bush. Frontier recently completed a new generation deeper seeing airborne EM (VTEM) survey (see Figure 14 for location) over the whole SMRV.
Whilst the SMRV project area lies within the South West Conservation Area, the area was specifically excluded from the adjacent World Heritage classification on account of its acknowledged high mineral prospectivity to the extent that the area within which the SMRV project lies has been classified as the Sorell Peninsula Prospectivity Zone.
The Mt Paris Tin Project is in northeast Tasmania (Figure 1). Torque holds almost all of the Mt Paris tin field, one of Tasmania's four historical significant hard rock tin fields in the northeastern Tasmanian tin province. For historical reasons this tin field has not seen the degree of modern exploration that the neighboring Blue Tier tin field, nor the other two major tin fields, Storeys Creek or Royal George. A 1988 review of the North East Tasmanian Tin Province (Purvis, 1988) for Aberfoyle concluded that "the stanniferous alkali granite intrusion known as the Mt Paris Mass has excellent grassroots tin potential. Although the numerous workings on the mass have produced little tin, eroded mineralisation has contributed over 27,000t tin to the alluvial deposits in the Ringarooma system, For personal use only use personal For making the Mt Paris Mass the most productive tin field in NE Tasmania. This fact has apparently not been appreciated by explorers to date – the area is underexplored. The mineralised roof zone of the granite is only partially exposed and eroded, with
60 the southern half of the intrusion still covered by Palaeozoic sediments. The inference from the massive amounts of tin shed from the eroded northern portion is that extensive tin mineralisation should be present beneath this cover."
Tungsten deposits are hosted in the Interview River granite (Bacon, 1992) in a 2.5km long belt (Figure 1). Veins known to date are generally relatively narrow though with high grades. No drilling has ever been done to test for larger veins or masses of smaller veins as is possible in such systems. Torque's manportable rig will allow the first such drill testing.
Torque will acquire from Frontier three diamond core rigs and ancillary excavators, crawlers, trucks etc, (including a “truly man portable” rig which is easily moved into difficult areas and has minimum environmental impact). Most nondrill type exploration has been completed on these projects and the great majority of funds raised will go directly to drilling. Torque plans a continuous and ongoing drilling program both to add to the resource base and to locate further mineralised systems. Torque’s drilling costs are significantly lower than commercial contract rates making for cost effective exploration. The Moina Project development strategy is three fold as follows:
Complete feasibility on existing resources and convert resources to reserves. Develop one or more mines either as a “stand alone” project or in joint venture with an existing producer. This should provide an early cash flow. Extend or replicate existing resources by drilling possible extensions and testing the many similar geological environments to the existing resources as defined by geochemistry and geophysics.
Drill out known major geophysical and geological targets that could represent major sulphide systems and/or gold and tin mineralised systems.
Drill the Wart Hill prospective horizon down plunge from the high grade Wart Hill massive sulphide lens.
Explore the Sassy Creek hybrid VHMS alteration system and other similar prospects for Wart Hill style massive sulphide and high grade gold with 3DIP and drilling
Explore anomalies defined by the recent VTEM survey (aerial electromagnetic survey).
Target the "holy host" horizon elsewhere in the belt.
Ultimately seek J/V partner for development. Carry out reconnaissance geochemical sampling to determine whether the targeted mineralisation styles (tin, rare earths) have economic potential.
Drill test high grade tungsten veins in areas of anomalous geophysics (lower priority work in first two years).
The Moina Project covers most of the Moina, Tin Spur, Round Mt, Narrawa and Stormont mineralised district, collectively
For personal use only use personal For described as the Moina Mineral District. The Moina Project covers 75.75sq kms and is held under three tenements (Table 2). There are two small gaps in the project area, which include retention licence RL 10/1988 covering 2km2 held by TNT Mines Ltd, and a small mining lease that covers the Bell Mt alluvial goldfield. RL 10/1988 covers the Moina Fluorite Skarn (including The
61 PROSPECTUS
Shepherd and Murphy vein system and the Hugo Skarn); a large body of skarn mineralisation with extensive tintungstenfluorine veins and greisen that has formed in the roof above the Dolcoath Granite where it replaced Ordovician sediments.
Mineralisation throughout the Moina Project is considered to be related to the Dolcoath Granite which underlies much of the area at various depths. There are at least 70 historic workings (shafts, adits and small open pits) (Figures 2 and 3) within the targeted area, testifying to its highly prospective and mineralised status. The primary historic commodity mineral in the district was tungsten in at least 23 workings, tin in 9 workings and gold in 7 workings. Silver, lead, zinc was worked at Round Mt (Jennings, 1958) and many historic prospects are unspecified as to metals worked.
Torque was formed in March 2012 as a wholly owned subsidiary of ASX listed Frontier Resources Ltd. Torque holds a 90% interest in Moina with Frontier retaining a 10% free carried interest to completion of a Bankable Feasibility Study.
Refer to section 2.1.1 for the Mineral Resources.
Moina is approximately 40 kms south of Devonport in north central Tasmania. It lies within the Burnie 1:250,000 map sheet and within the Cethana and Lea River 1:25,000 geological map sheets (MRT). Generalised geology and tenements are shown on Figure 4.
Access to most parts of the project is relatively good with the project bisected by several sealed (black top) roads, good gravel roads and numerous forestry tracks. Land use varies from forestry to minor farming.
Topography and vegetation, in comparison to much of western Tasmania, is relatively easy for exploration. It varies from open, relatively flat grasslands in the central project area to steep, forested hills in parts of the south and east of the tenements. Both resource areas at Stormont and Narrawa are presently served by four wheel drive tracks that could be upgraded quickly and cheaply to trafficable roads.
There are no particular known environmental or aboriginal heritage concerns or issues to overcome.
Moina is held under three tenements noted in Table 2. It is a predominantly Crown Land. It includes State Forest (multiple Use Forest Land), RFA – Informal Reserves, Land Vested in the Hydro Electric Commission (HEC) and some Private Property with mineral rights reserved to the Crown (Green, 1996).
Exploration and mining has been carried out at Moina since approximately 1860. Most exploration has involved surface prospecting and a number of short < 50m drill holes. Most of the potential of the area is considered to lie at depths of greater than 50m and within or above the underlying granite surface. This area of the project has not been tested except in RL 10/1988 held by TNT Mines. Within RL 10/1988 the Moina Fluorite Skarn deposit (plus tin, tungsten and gold) has been defined. This body has been deposited in the roof of the Dolcoath Granite where it replaced Gordon Limestone. The skarn occurs as a thick horizontal plate roughly 1 km in its longest dimension and 25 to 100m thick. It is separated from the granite’s upper surface by about 200m of Moina Sandstone. The plumbing system for the mineralising fluids was probably a series of eastwest trending tension fractures and raw tungstenquartz veins, associated with the major NW trending Bismuth Creek Fault (named the Shepherd and Murphy Vein swarm, TNT Prospectus, 2011).
The Moina Fluorite Skarn, and Shepherd and Murphy, and Hugo Skarn deposits have well defined associated aeromagnetic anomalies (Figures 7 and 8).
James “Philosopher” Smith in the 1860’s and 1870’s discovered alluvial gold in the Forth River, a galena vein near the Devon Mine, and galena near the mouth of Claude Creek. Galena veins were discovered at Claude Hill/Round Mountain in 1878. Between 1885 and 1887 several gold discoveries were made causing an exploration boom. In 1891 tin and tungsten ores were located on Dolcoath Hill. In 1883, the largest mine, the Shepherd and Murphy Tin and Tungsten mine, which lies within excluded RL 10/1988, was discovered and worked almost continuously until 1919 when fire destroyed the mill. Various other small ore bodies were found subsequently but their output was insignificant. These various bodies of mineralisation show a zonal distribution relative to the granite stock outcropping at Dolcoath Hill, with tintungstenbismuthmolybdenum ores in and adjacent to the granite, passing outwards to tin ores carrying sulphides and gold, to goldcopper ores, and to silverlead ores, in that general
For personal use only use personal For sequence. This zonation is reflected in the geochemical soil sampling completed by Frontier (Figures 9 and 10). Total production from the Shepherd and Murphy Mine was 559 tonnes tin, 24 tonnes wolframite, 72.5t metallic bismuth; and from the Round Mountain Mine (Figure 13) was 4,767 tonnes lead, 389,679oz silver, 1,300oz gold. Production records for the field are
62 incomplete, but the total production is estimated to be 8,300oz of gold, 393,000oz of silver, 5,008 tonnes of lead, 76.8 tonnes bismuth, 581 tonnes tin, 340 tonnes wolframite (Jennings 1963). The description in 3.2.1 is largely based on unpublished company reports which may or may not be complete. This description should be taken as an approximation of the previous exploration with no guarantee that all data was available to be reviewed. The author has made all reasonable efforts to ensure that this section is as accurate as possible.
Historic gold operations were minor, with the largest being the Stormont Mine, where a 40m long and 8m deep opencut with a 40m long adit was excavated in a body of gold and bismuth mineralised skarn between 1928 and 1934. The mine produced 6.3t of bismuth concentrate containing 63% bismuth and 91oz gold/t of concentrate.
A similar but more weakly mineralised goldbismuth skarn was prospected at Fletchers Adit on the south bank of the Lea River 1km NE of Stormont Mine. There is no record of production from Fletchers Adit.
Alluvial gold was worked in the Lea River downstream of the Stormont Mine and Fletchers Adit occurrences. Hard rock gold, hosted by thin quartz veins in a fault in Ordovician sandstone with conglomerate bands, was prospected by shafts 15m deep at the Stormont Gold Mine ( from the Stormont Mine) on the northern slopes of Mt Stormont. Again, there is no record of production.
There is no record or visible sign of historic prospecting in the Ti Tree Creek skarn.
Modern largescale systematic exploration of the EL 20/92 area was initiated by Mt Lyell Co. in 1965. After an aeromagnetic survey, they cut a major grid that was followed up with detailed grids over the skarns at Ti Tree Creek and the Stormont Mine – Fletchers Adit area.
Magnetic and bismuthinsoil anomalies delineated over the TiTree skarn were investigated by 700m of costeaning and two test lines of poledipole IP. IP anomalies and costean rock chip sampling was completed. Drilling was recommended but not done.
In the Stormont Mine – Fletchers Adit area, Mt. Lyell undertook soil sampling and gradient array IP and delineated a large skarn, with modest bismuthinsoil and IP anomalies north of the Lea River opposite Fletchers Adit, but did no drilling. No further exploration was undertaken at the Stormont Mine, because their estimate for the mineralised body was regarded as too small. Mt. Lyell withdrew in 1972 and in 19721973 the Department of Mines drilled two holes into the TiTree skarn. DOM2 (101m) intersected 15m of skarn at surface with a best interval of 3.2m (6.85m to 10.07m) of 0.18% bismuth and “trace” gold. DOM3 (EOH95m) intersected 1.03m (11.97m to 13.0m) of skarn and calcsilicate under 10m of Tertiary basalt, for a best result of 1m of 0.11% tin.
From 1974 to 1979 the licence area was part of a major exploration effort by Comalco, who discovered and drilled out the Moina Fluorite Skarn Deposit (26 million tonnes of 18% calcium fluorite, now held by TNT Mines Ltd). They searched the surroundings for similar mineralisation, gridding a large area at 50m spacing and carrying out mapping, soil sampling, magnetics, some IP and drilling.
At Ti Tree Creek, Comalco determined the DOM2 skarn contained fluorine. They did a gradient array IP survey over Stormont Mine and Fletchers Adit that indicated skarn extensions SW of Stormont, and east and west of Fletchers. However, they did no drilling at either prospect.
On the Tertiary covered lowlands (basalt and sediments), 1km north east of TiTree Creek, Comalco drilled 3 holes testing magnetic anomalies. Two intersected wrigglite (magnetitefluorite skarn) averaging 10.7% calcium fluorite: 17.4m in SMD17 (26.5m to 43.9m assaying 11.3% calcium fluorite) and 21m in SMD23 (6.0m to 27.0m assaying 10.7% calcium fluorite), but no gold. SMD20’s target anomaly proved to be clayfilled limestone caverns, but 16m of calcsilicate skarn under the limestone was not assayed. DOM1, a 327m vertical stratigraphic hole, intersected the thickest limestone section at Moina at 21179m down hole. The basal 9m of the limestone comprised calcsilicate skarn and minor wrigglite, containing 0.5m (176.8m to 177.3m) of 8% fluorine, 0.13% bismuth and “trace” gold.
Comalco was followed at Moina by two J/V partners, Shell and CRA. CRA reassayed most of the Comalco holes for gold, concentrating on those in and around the Moina Fluorite Skarn. They confirm the higher gold values in the Hugo Skarn and showed the eastern part of the Moina Fluorite Skarn deposit contained irregular spotty values of 0.20.4g/t gold.
In 1981, Shell drilled LGD1 (254m) within EL 20/92, to test a coincident magnetic/gravity anomaly on the Moina Sandstone ridge
For personal use only use personal For west of Lake Gairdner. Below 101m the hole was in magnetiteveined Mt Read Volcanics. It was devoid of mineralisation. In 1983, Gold Fields Exploration (GFEL) took up the Stormont area after it was dropped by the Comalco J/V. GFEL’s target was
63 PROSPECTUS
gold and they determined all streams draining north from Mt Stormont were anomalous in gold. Sampling of the final face in the adit, showed the old miners stopped in ore grading 36.5g/t gold and 1.1% bismuth.
From 1988 to 1990 GFEL drilled 21 holes at Stormont Mine and 9 near Fletchers Adit. Intersections at Stormont have been included in the resource estimation.
At Fletchers, the holes were all north of the Lea River and outlined a large area of weakly auriferous skarn mostly beneath thin Tertiary basalt. Exploration was hindered by the basalt cover. One hundred metres away, the northern most hole (FD8) had a 35m gold anomalous section with 21.2m assaying 0.3g/t gold from 64.8m to 86m.
Despite the encouraging drill results GFEL withdrew in 1991. In the five years GoldstreamTitan had EL 20/92, the exclusive focus of groundwork on the licence was drilling at Stormont Mine.
The only work done by GoldstreamTitan on the EL outside Stormont was a highresolution helicopter borne aeromagnetic survey of the whole 25 square kilometer tenement in 1996. They also drilled the Hugo Skarn for zinc, gold and bismuth on RL 10/1988 (TNT Mines property), where they had a J/V from 1993 to 1997.
In 1999/2000, Jervois drilled 5 short vertical diamond drill holes (TC0105) totaling 188m at the Ti Tree Creek skarn testing geological and geophysical targets. Intersections above 0.5g/t cut off were 1m of 1.39g/t gold in TC04 (0m to 1m) and 1m of 1.2g/t gold in TC05 (16.75m to 17.75m).
The description in 3.2.2 is largely based on unpublished company reports which may or may not be complete. This description should be taken as an approximation of the previous exploration with no guarantee that all data was available to be reviewed. The author has made all reasonable efforts to ensure that this section is as accurate as possible. Smallscale mining and prospecting commenced in the area in the mid/late 1800’s and continued intermittently until the 1980’s. Most activity was directed at the numerous veins and greisen’s bearing tintungsten, plus or minus bismuthmolybdenum.
Previous exploration and small scale mining delineated gold and leadzinc mineralisation in the catchment of Narrawa Creek, centered on the old Higgs and Narrawa Reward gold mines (now combined and known as the Narrawa deposit).
Shear hosted gold (and silverlead) was discovered at the Narrawa Reward Mine beside Narrawa Creek in 1893 (Jack, 1961). In 1934 gold (and lead) disseminated mineralisation was discovered and worked at the Higgs Mine 200m to the SW.
The first systematic exploration was in 19811982 when CRA tested the basemetal and tintungsten potential of the altered sediments on the granite margin. To followup anomalies detected by airborne DIGHEMmagnetics, CRA cut a large grid over the Narrawa Creek catchment and undertook soil sampling, VFL EM, UTEM and ground magnetics (Weber, 1982).
The VFL, EM and UTEM delineated broadly coincident conductive zones associated with both old goldmines, with the responses extending hundreds of metres beyond the workings. A major EW trending structure along Narrawa Creek was inferred from the magnetics (Flis, 1982).
CRA drilled three moderate depth diamond holes. Of two holes drilled beneath the Narrawa Reward Mine, one intersected low leadzincgold values (3.7m of 1.2% lead, 1.2% zinc and 0.3 g/t gold, DD82DG1 94.5m to 98.2m). The other hole did not intersect mineralisation.
In 1986 Gold Fields Exploration (GFEL) started work on the CRA grid with Chorizon soil sampling and channel sampling of the old workings. They assayed CRA’s Narrawa Reward holes for gold.
GFEL obtained numerous soil anomalies in the 0.53.9g/t gold range. There was also gold in their channel sampling, particularly at the Higgs Mine. They drilled three diamond holes deep under Higgs with much weaker gold results than from surface sampling.
The GoldstreamTitan J/V took up the ground in 1992 and flew a detailed aeromagnetic survey over it in 1996 but no groundwork was done (Newnham, 1997b).
Jervois Mining, in 1999 to 2000 drilled a number of holes at Narrawa with results listed below:
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64
NC01 0 10.9 8 0.6 0.7 including 0 2 2 4.26 11 0.9 0.6 9.5 10.9 1.4 4.34 33 2.8 3.9 NC01anchor 0 1.5 1.5 5.49 15 0.7 0.2 NC02 10.7 17.7 27 0.6 0.5 including 12.8 15.2 2.4 2.53 61 0.5 1 0.1 NC03 NC04 5 11.9 including 6.6 7.2 0.6 3.0 NC05 NC06 7.5 24.9 23 1.1 1 including 10.25 10.5 0.25 10.2 57 6 5.8 0.1 NC07 3.1 22 6 0.2 0.4 0.1 including 15.6 16.3 0.07 13.5 92 10.3 6.9 0.2 NC08 10 17 NC09 1.3 1.7 NC10 39.9 41.1 NC11 0 1.6 NC12 7.1 32.5 23 2 1.5 <0.1 including 7.1 8.4 1.3 19.7 49 4.9 4 15.25 16.25 1 8.04 10 0.5 <0.1 18.6 19.75 1.15 7.98 67 5.3 5.3 0.1 NC13 56.6 57.6 <5 <0.01 0.07 0.13 NC14 31.15 38.6 <1 <0.01 0.02 0.01 NC15 3 4.5 <1 0.09 0.01 <0.01 NC16 19.8 27.5 <1 <0.01 0.15 0.04 including 23.8 27.5 <1 <0.01 0.05 0.03 45 46.6 1.6 0.85 <1 0.01 0.01 0.05 47.45 48.8 0.19 49.5 50.5 <1 0.01 <0.01 0.11 NC17 11.5 12.5 <1 <0.01 <0.01 <0.01 including 35.6 37.8 15 0.79 3.26 0.14
Cambrian calcalkaline volcanics (Mt Read Volcanics correlates) and associated sediments (a few hundreds of metres thick and intrusive porphyries/granite) were deposited/intruded in marine conditions on the northern margin of the Precambrian metasediment hinterland. Uplift of this hinterland in the late Cambrian/early Ordovician followed or accompanied cessation of volcanism with some associated deformation (folding) also affecting the Cambrian rocks (Pemberton and Corbett, 1992).
In the early Ordovician large volumes of siliciclastic sediment, Roland Conglomerate a few metres thick, and Moina Sandstone a few hundred of metres thick derived from this hinterland were deposited unconformably on the volcanics. Changes in sea levels saw sedimentation become more marine with marly sediments followed by limestone (Gordon Limestone).
In the Middle Devonian Tabberrabberran Orogeny the region underwent deformation. The first phase of deformation produced the very broad open (~10km wavelength) eastwest trending syncline which occupies most of the region west of Lake Cethana. The region was then put under southwestdirected compression with associated folding, thrusting, strike slip faulting and the intrusion of the Dolcoath Granite. This latter phase produced the smaller scale (wavelengths of tens to a few hundred metres) northwest to northnorthwest trending folds . It also created the regionally significant Machinery Creek thrust fault (associated with Round Mt. base metal/gold mineralisation) and associated smaller thrusts.
A Tertiary erosion surface, characterised by cemented gravels (greywacke) is developed over parts of the Ordovician sediments. Tertiary basalts obscure both older geology and possible mineralisation over substantial sections of the Project area.
Generalised geology is shown on Figure 4. For personal use only use personal For
65 PROSPECTUS
All hypogene tin and tungsten deposits as well as many historically important deposits which produced gold, lead, silver, zinc, copper and bismuth in Tasmania were emplaced during this period of mineralisation in the Late Devonian to early Carboniferous. Production and resource figures are listed in Table 1. Most deposits are spatially related to outcropping or buried granitoids (Collins and Williams 1986; Leaman and Richardson, 1989). The Dolcoath Granite at Moina is an example of such a granite or granitoid.
The connection between the subsurface distribution of granitoids, as determined by modeling of gravity data (Leaman and Richardson, 1989, Morrrison et al 2003 and Leaman 1988), and the locations of midPaleozoic mineral deposits was illustrated by Green et al, 1988. Major tin deposits of iron sulphide replacement type fall within the 4km granite isobath, many near or above the 1km contour, as do the more significant gold and silver, lead, zinc vein deposits.
The Dolcoath Granite and its mineralised aureole is described by Morrison et al 2003: “the 4km2 of Dolcoath Granite which crops out in the Forth Valley is a late Devonian medium to coarsegrained quartz, microcline, plagioclase, biotite crystal fractionated I type granite. Gravitymagnetics modeling (Leaman and Richardson, 2003) shows that the batholith dips shallowly west, with a subsurface area of approximately 50km2 covered by a maximum of 500m of folded Cambrian volcanic and Ordovician sedimentary rocks, and flatlying Tertiary basalt. The elongated eastwest form and steep eastern and southern margins are considered by Leaman and Richardson (1989) to be due to roof spines and major fault control. Exploration drill intersections of granite within 200m of the surface (Taylor, 1990; Jannink, 2002) suggest the presence of cupolas or local highs in the roof topography inside the 500m isobath.
Figure 7 shows the total magnetic intensity and the circular magnetic low over the outcropping granite and the surrounding moderate high over the contact aureole. The necking of the 500m isobaths in the central part of the aureole, and the form of the magnetic high west of the granite, appear to be related to the prominent north westtrending structure, the Bismuth Creek Fault. The total magnetic intensity (TMI) image also suggests that the granite may be relatively shallow in the western lobe of the aureole, approximately two kilometres southwest of the Stormont Mine. The tungsten and tin vein deposits in particular sit on the margin of a radiometric anomaly surrounding the outcropping granite, whereas the gold and fluorite skarns are controlled more by the location of limestone in northwesttrending synclines in the northern contact aureole. Magnetic anomalies occur over the magnetitebearing Moina Skarn Deposit and the Stormont gold deposit (Figures 7 and 8).
An amphibolite facies contact metamorphic aureole and two phases of metamorphic aureole and two phases of metasomatic alteration and mineralisation have been mapped in the Ordovician limestone and calcsilicate beds marginal to the granite (Webb, 1974). Mineralisation within the aureole includes substantial gold at Higgs, Narrawa Reward, Hugo (part of East Moina) and Stormont, and minor gold occurs in several other workings (Fleming, 1988).”
The 500m granite isobath and area of granite at less than 500m, is shown on Figures 4, 6, 6A, 7 and 8.
The various exploration programs and studies by Torque, MRT and others (Newnham, 1997) have noted a number of distinct types of mineralisation – all considered to be related to the Dolcoath Granite.
The most important known mineralisation / mineralisation models / Exploration Target within Torque’s tenements is the gold/skarn related model of Stormont and Narrawa – gold/bismuth or gold/zinc/lead with gangues of pyrite plus or minus magnetite, plus or minus pyrrhotite. These deposits form in calcareous transition beds between the Moina Sandstone and Gordon Limestone, and in shears and fracture zones within the Moina Sandstone. The Gordon Limestone itself would also appear to be a favourable host for large gold/skarn accumulations (similar to the Moina Fluorite Skarn of TNT Mines in RL 10/1988). The Gordon Limestone rarely outcrops and to date no gold skarns have been located within this unit.
The aeromagnetics, geochemistry and recent IP survey all suggest there is excellent potential to extend known resources and define new gold mineralised bodies in the near surface environment and beneath the younger basalt cover. See also Project Descriptions of Stormont and Narrawa for additional detail.
This Exploration Target may vary from 100,000t at 2 to 4g/t gold plus/minus bismuth, zinc, lead, silver to 20,000,000t at 2 to 4 g/t gold.
This Target has been derived from the exploration results in Section 3 of this report; by the resources defined at Stormont and Narrawa; by extensive anomalous gold soil geochemistry and by the 3DIP survey. The 3DIP survey, in particular, suggests there may be a number of mineralised bodies similar to or larger than Stormont and Narrawa within the Moina Project.
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66 In respect to the Exploration Targets above, it must be noted that the potential quantities and grades are conceptual in nature, that there has been insufficient exploration to estimate a Mineral Resource (except at the Stormont and Narrawa prospects) and that it is uncertain if further exploration will result in the estimation of Mineral Resources additional to those at Stormont and Narrawa.
This Exploration Target is disseminated gold, pyrite, bismuth mineralisation within the uppermost parts of the Dolcoath Granite or in the Moina Sandstone immediately above the granite contact. There is potential for multiple bodies varying in size from a few million tonnes to hundreds of millions of tonnes at grades of 0.7 to 1.5g/t gold.
This target is based on research by Mineral Resources Tasmania, described below, anomalous gold and bismuth within the Dolcoath Granite and the 3DIP survey. The latter survey suggests large bodies of pyritic mineralisation exist at depth within the Moina Project.
In respect to the Exploration Targets above, it must be noted that the potential quantities and grades are conceptual in nature, that there has been insufficient exploration to estimate a Mineral Resource and that it is uncertain if further exploration will result in the estimation of Mineral Resources. Morrison et al (2003) have postulated that the Dolcoath Granite provides a gold target such as major gold deposits at Fort Knox, Alaska and Mokosko in the Czech Republic.
Their description of the Dolcoath Granite and reasoning for their conclusion that the Moina area has potential for this class of deposit is quoted below:
“Intrusionrelated gold systems (IRGS) are described by Thompson et al. (1999) as an underrecognised and economically important class of magmatic/hydrothermal gold deposits, which exhibit major distinctions from porphyry and epithermal systems. Intrusionrelated deposits occur in felsic magmatic provinces best known for their tin or tungsten mineralisation. The gold deposits are mainly derived from and hosted in intrusions of granitegranodiorite composition in cratonic or continental collision tectonic settings. They contain zoned metal suites comprising some combination of bismuth, tellurium, arsenic, tungsten and tin deposits tending to be hosted in the contact aureole and gold deposits within the granitic rocks. Bismuth is the critical pathfinder element and the deposits are generally low (<5%) in total iron and base metal sulphides (Baker, 2003; Lang and Baker, 2001).
The intrusions are derived predominantly from itype magmas with oxidation states near the Ishihari magnetiteilmenite series boundary. Gold mineralisation is typically hosted in fractional facies of the plutons, such as greisens, aplites, pegmatites or porphyry dykes. These facies usually occur at the margins or roof contacts of the intrusions.
The deposits can be sheeted vein style, greisens or breccias, and aureoles 1 to 3km from the intrusions which may also host skarn replacement or veinstyle deposits. Potassium feldspar, albite, sericite and carbonate alteration is common, with greisenlike disseminated style mineralisation associated with the most pervasive alteration. Alteration is commonly restricted to vein envelopes.
The low sulphide content often comprises mainly arsenopyrite and pyrrhotite, indicative of a reduced hydrothermal fluid in which H2S was the dominant sulphur species. Bismuth and tellurium are the clearest indicator elements and both correlate closely with gold. Most systems contain tungsten, tin molybdenum and antimony but at the prospect scale these elements do not correlate with gold, due to metal zonation around the intrusion. The lack of a chalcophile metal association and the enrichment in lithophile ore metals distinguishes this style from porphyry coppermolybdenumgold deposits.
Thompson et al. (1999) reviewed the geology of the main IRGS ore bodies recognised to date. Several deposits contain >3 million ounces of gold; these are widely distributed in continental granitic terranes from Europe, Central Asia, Northern China, AlaskaYukon, Bolivia and eastern Australia.
Two classic IRGS examples which clearly show similarities with mineralisation related to the Dolcoath Granite are Fort Knox and Mokrsko.
: A large gold deposit in sheeted veins hosted in a Cretaceous ilmenite series porphyritic granite, and with the main accessory metal suite comprising bismuth, tellurium, molybdenum, arsenic, tellurium, molybdenum, arsenic, antimony and tungsten.
: A large gold deposit in sheeted veins hosted in a Devonian Itype granodiorite, and with the main accessory metal suite comprising bismuth, arsenic, tellurium, molybdenum, tungsten and antimony.
For personal use only use personal For Although individual veins in the sheet system at Fort Knox are only 20150mm wide, there is regional scale major fault control on deposit location. Tungsten and tungstengold skarns occur in the contact aureoles of goldbearing intrusions at both Fort Knox
67 PROSPECTUS
and Mokrsko and they are enriched in arsenic and antimony relative to the endogranite sheeted vein gold deposits. Total sulphide in gold mineralised veins, is 0.5% by volume at Fort Knox and <1% at Mokrsko. Within the veins, gold correlates highly with bismuth and tellurium but not with tungsten, antimony, molybdenum or arsenic.
Taylor (1990) compiled drill assays from goldbearing skarns at Stormont and Fletchers Adit. These assays showed a very high goldbismuth correlation, in contrast to the poor correlations between goldsilver. Taylor concluded that the goldbismuth skarn mineralisation was generated by a second phase of mineralising fluid. This could be interpreted as a latestage fractionation of the granitic magma generating a reduced goldbearing fluid. Taylor also confirmed the existence of bismuthtellurium sulphide mineral phases in very close association with high fineness (low silver content) electrum.
The distribution of mineralisation along the northern margin of the aureole (granite) suggests a structural control on granite fractionation, even if only the tungsten, fluorite and tin deposits are assumed to be sourced from granitic fluids. The concentration of outcropping mineralisation at the eastern end of the aureole, closest to the granite, flags exploration potential in the central and west of the aureole, beneath <500 metres of cover. Fander (in Roberts, 1987) confirms the presence of Devonian greisenised quartz, feldspar, mica, topaz porphyry dykes in drill core and outcrop around the Narrawa Reward gold workings. Morrison (in Fleming, 1988), in an overview of gold prospectivity, implies a magmatic input to the gold mineralisation by recommending fault controlled greisen veins cutting carbonate units as highranking explorations targets.
There is some more direct evidence of a link between granite and gold mineralisation. Samples of fractionated granitic rocks taken from near workings, either on granite or around the northwest margin of the batholith, The exploration challenge on the Dolcoath Granite is to find the structural setting where a major gold mineralised vein system, dyke, cupola or greisen sheet can be sensed beneath up to 500 metres of cover. Low sulphide IRGS deposits are unlikely to be detected by electromagnetic geophysics but a combination of ground magnetics and soil geochemistry may generate drill targets on structures leaking gold/bismuth through cover rock thickness could be estimated from the geophysics.” Au (ppb) Bi (ppm) DG1 Pegmatitic granite with vein quartz, wolframite 426517mE, 5 406 685mN Sayers 10 10 DG2 Pegmatitic granite with vein quartz 426529mE, 5 406642mN Sayers 16 15 DG3 Pegmatitic granite with cavity fill smoky quartz, 426382mE, 5 406597mN Povey 19 49 clear quarts, wolframite DG4 Muscovite, quartz greisen, granoblastic biotite 426333mE, 5 406725mN Batemans 12 <10 hornfels DG5 Quartz porphyry with fine muscovite greisen 426000mE, 5 406615mN Squibs 9 <10 Average granite2 2.4 0.6 (0.26.1) (0.042.0) 1. Samples assayed by Analabs (2003) Aufire assay (50g) AAS (1ppb L/D), Bitriple acid digest/AAS (10 ppm L/D).
2. Wedepohl et al., 1978 Auunweighted mean of 692 samples from 23 granites, Biunweighted mean of 23 samples from 6 granites.
Torque have undertaken extensive soil geochemistry, reprocessed existing aeromagnetic data and compiled a 3D Induced Polarisation (IP) survey over approximately 25sq kms of the Moina project with the objective of defining possible Intrusive Related Gold targets.
The IP survey results are described in Section 3.5.3. It was successful in defining numerous possible disseminated sulphide targets that could be associated with such gold targets. These will be systematically tested by drilling.
Several interrelated tin/tungsten/gold models are present at Moina. Some of these may be defined as Exploration Targets after additional exploration. They include: For personal use only use personal For
68 in granite or in the country rock. They frequently overlie cupolalike protuberances of altered granite. East west oriented sheeted quartz veins have been mined for tin, tungsten and bismuth at the Shepherd and Murphy Mine (within the RL 10/1988, not held by Torque). The veins cut the Moina Skarn Deposit (fluorine plus metals held by TNT Mines) and underlying silicified sandstone and are developed adjacent to a NW trending fault.
, although not previously described at Moina, could be developed within or near the upper surface of the Dolcoath Granite. Such deposits are present elsewhere in Tasmania in similar geological environments to that which exists at Moina.
, such as the Moina Fluorite Skarn, a fluorite, magnetite, vesuvianite skarn, (held by TNT Mines within RL 10/1988) are known to exist in the area and may be present within the Moina Project of Torque. This skarn contains cassiterite (tin) and scheelite (tungsten) and locally high zinc and gold and occurs in a flat sheet in basal Gordon Limestone with 100m to 200m of Moina Sandstone between the skarn and greisenised granite. Pyrrhotite is common in some skarns (also an indicator mineral for Intrusion Related Gold) and is also common at the Narrawa Prospect.
The Moina Fluorite Skarn Deposit of TNT Mines was also described earlier in this report. The various skarns in the Moina Fluorite Skarn Deposit can carry fluorite; tin; tungsten; beryllium, zinc and gold. Indium is also noted related to the Bismuth Creek Fault (probably the main conduit for mineralising fluids).
or distal (from the granite source) skarns or manto deposits are major sources of tin in Tasmania – notably Mt Bischoff, Renison, Cleveland and King Island. This type of mineralisation has not yet been defined at Moina but the geological environment at Moina is similar to that at the above deposits.
These iron sulphides (mainly pyrrhotite) – cassiterite deposits occur above the upper surface of granite and consist of stratiform massive pyrrhotite plus pyrite replacement bodies of dolomite and limestone (such as the Gordon Limestone at Moina). Mineralisation in faults, and/or porphyry dykes (such dykes are known to exist at Narrawa), usually underlying the replacement horizons, constitute a significant part of the economic resource in most deposits.
Although this represents a minor model at the Moina Project, conductivity anomalies at Round Mountain and its vicinity could indicate more extensive silver, lead, zinc mineralisation (Figure 13). Further exploration may lead to this model being defined as an Exploration Target in the future.
In addition to drilling and detailed studies at both Stormont and Narrawa, Frontier carried out several regional programs throughout the project area to assess mineralisation potential, other than at Stormont and Narrawa, and to define new target areas that may host major mineralised systems. These surveys were three fold – to “look beneath” the younger basalt cover; to explore to depths as great as 500m to locate major mineralised systems that did not reach the surface; to define structures which may have acted as fluid conduits upwards from the Dolcoath Granite.
Aeromagnetics have assisted in defining: the limits to the Dolcoath Granite; the untested or partly tested anomalies similar to either the anomaly defining the Stormont deposit or the Moina Fluorite Skarn; and the various structures which may be significant in terms of conduits for mineralising fluids. The magnetic low area on the total magnetic intensity, (TMI – Figure 7) illustrates the broad disposition of the Dolcoath Granite at surface and at depth. It also illustrates the anomalies associated with the Moina Skarn and Hugo Skarn (both TNT Mines). Similar anomalies to these can be seen elsewhere within Torque’s project area and could represent skarn mineralisation and are either untested or only partly tested by drilling.
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69 PROSPECTUS
Figure 15: Conductivity Anomalies 75m Depth Slice, Stormont Area Conductivity anomalies (as defined by consultant geophysicist) in the immediate Stormont area. Note that the Stormont resource outline at surface closely corresponds to the Stormont conductivity anomaly. The figure shows the many Stormont “look alike” anomalies any of which could host Stormont style mineralisation. The cross hatched area shows basalt cover which effectively prevents any mineralisation beneath this area from outcropping.
Figure 15A: Detailed Aeromagnetic Image of Stormont Area
This image illustrates the close relationship between a magnetic high and the Stormont mineralisation. The many other magnetic highs, both named and unnamed could reflect mineralisation similar to Stormont. The hatched area is basalt cover which prevents any mineralisation from having a surface expression.
Soil geochemical surveys have been successful in confirming the zoned nature of mineralisation in respect to the Dolcoath Granite For personal use only use personal For and defining possible extensions to known mineralisation.
70 Sampling in the central part of the project area from approximately Round Mountain to the western boundary of RL 3/2005 (Narrawa) demonstrated distinct metal zonations proximal to the Dolcoath granite to various distances from the granite contact. The anomalies are also variably associated with lithologic and/or structural contacts between the sedimentary, porphyry and volcanic sequences (Figures 9 and 10).
Gold anomalism was demonstrated over a total strike length of 5,000m in two main areas with a WNW orientation. The more extensive western gold anomaly is 1,800m long x 350m wide and corresponds to the Narrawa district. Gold correlates moderately with lead and weakly with zinc, copper and tin; it has a no correlation with bismuth, molybdenum or antimony. The SE sector of the overall gold anomaly is a completely new target; it has a different geochemical ‘signature’ to the Narrawa Deposit and correlates strongly with lead, bismuth and arsenic and weakly with silver, antimony, zinc and thallium in soils.
Tungsten soil assays have demonstrated a large area of anomalism over a more than 5,000m strike length with 3 major zones to 1,700m long at over 100ppm. Tin shows a very similar pattern to tungsten at the same cutoffs, but is displaced slightly further from the granite contact and is more extensive to the SE. Tin is also moderately anomalous in a NW trending zone or structure that hosts the Narrawa Deposit. The molybdenum anomaly is 4,000m long, cohesive and strong around the northern margin of the granite and is slightly more prevalent than bismuth. Copper is strong and widely distributed in the SE to central sector and also associated with the NW trending structure noted above.
Bismuth occurs in the NW and NE sectors of the granite itself in a 1,400m long by 50 to 500m wide, NE trending zone, plus an additional narrow 2,000m long zone trending to the SE. The main zone is completely open to the south into the granite.
Yttrium and niobium (rare earth elements) anomalies are spatially restricted and are strongest in the central north sector of the granite; they are cohesive ‘blobs’ that are about 500m long and open to the south toward the core of the granite. The significance of these anomalies is unclear.
Historical drilling around the Narrawa Deposit by Frontier and others has been for gold and generally restricted to shallow depths. The Narrawa region is distinctive, not only for the present gold resource, but for drill intersections of many different elements, examples of which are illustrated in Table 4.
Gold 1.2m grading 25.3g/t gold, 32g/t silver,5.90% lead and 4.4% zinc (NC06 from 14.5m)
Silverleadzinc 1m grading 460g/t silver, 2.53g/t gold, 18.7% lead, and 15% zinc (NC22 from 55m)
Tungsten 1m grading 1.98% WO3 (from 35m) within 14m of 0.20% WO3, (NCO48 from 22m), also 0.5m grading 1.26% tungsten, 0.12% molybdenum (DD82G1 from 166.5m)
Bismuth 1.2m grading 0.275% bismuth, 0.864% tungsten and 12g/t silver (ND2 from 52.9m)
Molybdenum 0.8m grading 0.48% molybdenum (DD82G1 from 116.5m), also 125m grading 80ppm molybdenum (ND03 from 3m), also 12m grading 116ppm molybdenum (ND01 from 104m)
Tin 1.3m grading 0.104% tin (NC13 from 50.4m)
The wide distribution and tenor of tungsten soil geochemistry noted is very encouraging as historic drilling has already documented structurally controlled near surface, highergrade tungsten within lower grade, but potentially bulk mineable mineralisation.
Excellent tungsten potential in soil appears to exist proximal to and SW and SE from the Squib Mine area, which historically was the richest and largest tungsten producer in the area. The Squib mined highgrade tungsten, molybdenum, bismuth +/ tin and gold bearing quartz veins and historically produced around 34.5 tonnes of tungsten. Frontier completed an extensive 3DIP Survey (carried out by S J Geophysics of Vancouver) in February 2012. This survey produced chargeability and resistivity data extending from surface to approximately 400m to 500m depth. The resolution of the survey decreases with depth from surface.
For personal use only use personal For The 3DIP Survey produced chargeability and resistivity (conductivity is the inverse of resistivity) data which is then computer processed to produce three dimensional images and horizontal “slices” below surface every 50m and cross sections at either 100, 125 or 250m intervals. Only a few representative figures can be reproduced here because of the large volume of data.
71 PROSPECTUS
Theoretically high values of chargeability could reflect disseminated sulphides in a host rock; more modest values could define smaller bodies of sulphides; high resistivity could reflect silicification associated with quartz vein type deposits; low resistivity or high conductivity could reflect zones of more massive sulphides, clays and graphite. Other geological features such as carbonaceous zones, structure and saline water may also cause anomalies. This was a major survey with a total cost of approximately $600,000.
The 3DIP Survey had multiple objectives as follows:
To explore for extensions to existing resources at Stormont and Narrawa; To define the chargeability, resistivity and conductivity characteristics of Stormont and Narrawa and apply such characteristics to similar anomalies defined by the survey throughout Moina. Similar results could thus reflect gold deposits similar to Narrawa and Stormont, particularly if also supported by anomalous geochemistry and/or magnetic anomalism; To explore for mineralised systems beneath the extensive basalt cover (which prevents geochemistry and prospecting to be effective exploration methods); and To explore the greisenised upper surface of the Dolcoath granite, and the rocks immediately above the granite for large disseminated gold deposits.
The 3DIP surveyed 167.4 line kilometres – an area of approximately 25 sq. kms. Line spacing varied depending on area from 100 to 250m.
The 3DIP method can be summarised as follows:
The time domain IP technique energises the ground by injecting square wave current pulses via a pair of current electrodes. During current injection, the apparent (bulk) resistivity of the ground is calculated from the measured primary voltage and the input current. Following current injection, a time decaying voltage is also measured at the receiver electrodes. This IP effect measures the amount of polarisable (or “chargeable”) particles in the subsurface rock.
Under ideal circumstances, high chargeability corresponds to disseminated metallic sulfides. Unfortunately, IP responses are rarely uniquely interpretable as other rock materials are also chargeable, such as some graphitic rocks, clays and some metamorphic rocks (e.g. serpentine). Therefore, it is prudent from a geological perspective to incorporate other data sets to assist in interpretation.
IP and resistivity measurements are generally considered repeatable to within about five percent. However, changing field conditions, such as variable water content or electrode contact, reduce the overall repeatability. These measurements are influenced to a large degree by the rock materials near the surface or, more precisely, near the measurement electrodes. In the past, interpretation of a traditional IP pseudo section was often uncertain because strong responses located near the surface could mask a weaker one at depth. We attempt to overcome this uncertainty by employing geophysical inversion to better interpret the data.
Three dimensional IP (3DIP) surveys have been designed to take advantage of recent advances in 3D inversion techniques. Unlike conventional 2DIP, the electrode arrays are not restricted to an inline geometry. Ideally, a 3DIP survey would consist of a random assortment of current injections and receiver dipoles, also of randomised azimuths. Unfortunately, logistical considerations usually prohibit a completely randomised approach.
In the standard 3DIP configuration, a receiver array was established along one survey line while current lines are located on two adjacent lines lying on either side of the receiver line. Current injections are performed sequentially at fixed increments (25, 50, 100 or 200m) along the current lines. By injecting current at multiple locations along current lines adjacent to receiver arrays, data acquisition rates are significantly improved over conventional surveys. Meanwhile, geophysical data are collected along a receiver array that consists of dipoles usually laid out along even intervals dictated partly by the receiver cable.
The Volterra system provides much more flexibility because each DABStix receiver records a single dipole, thus eliminating the need for specialised receiver cables and a centralised receiver control station. Dipoles can be oriented in any direction, can be of varying lengths, and completely avoid inaccessible areas if necessary.
Although more randomised than conventional 3DIP, most Volterra surveys still follow some form of cut lines, alternating receiver dipoles and current injections and deviating where necessary for geophysical or logistical purposes. In addition, crossline receiver dipoles are often used to increase nearsurface resolution and allow for larger spacing between lines. The specifics of each survey are customised before the survey starts and sometimes during the survey by the field geophysicist.
For personal use only use personal For The 3DIP Survey defined numerous chargeability and conductivity anomalies. In addition, resistivity will assist in defining structures that could be significant such as mineralising fluid conduits.
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The survey provided a very large amount of data and interpretation will be ongoing – assisted by drill results as they come to hand. For the purpose of this report a number of examples have been selected that could provide drill targets for the initial testing of chargeability and/or conductivity anomalies.
The chargeability results defined a broad NW trending anomalous zone extending from the Round Mt area in the SE beneath Lake Cethana, through Narrawa to the Bell Mt area. Figure 6 shows the chargeability of the rocks at 50m below surface. The numerous anomalies could be defining sulphides within Moina sandstone that in turn could also host gold and/or tin mineralisation. Initially some of these shallower anomalies will be targeted for drill testing to determine the cause of the chargeability anomaly. Figure 6 also shows the chargeability at 150m below surface and the anomalies here may reflect sulphide mineralisation within, or above the granite surface. Some of these anomalies will also be targeted for deeper drill testing.
Figure 11 is a section along grid 4590E. Note the chargeability anomaly trends or dips to the north, and possibly reflects the zone at or near the top of the granite. This is the zone that greisenisation of the granite would occur or large disseminated gold mineralisation could be expected.
Resistivity/conductivity data (Figures 6A, 12, 15 and 20) define anomalies associated with the Stormont and Narrawa mineralisation (see Sections 3.6.4 and 3.7.3). The Stormont and Narrawa mineralisation is reflected by conductivity anomalies and other similar conductivity anomalies in the Stormont area will be drill tested. Many of the conductivity anomalies also have coincident magnetic anomalies, indicating skarn mineralisation.
At Narrawa, conductivity anomalies, in association with gold soil anomalies, have defined extensions to the Narrawa system and adjacent new targets. Both the Higgs mineralisation (present resource), and the Narrawa Reward mineralisation are associated with conductivity anomalies.
At Round Mt the known mineralisation coincides with a conductivity anomaly. Adjacent similar anomalies need to be drill tested (Figure 13).
It is important to note that many anomalies are beneath basalt cover, and, if mineralisation does exist, it would not have been discovered by earlier surface exploration or prospecting.
We emphasise again that the IP Survey generated a very large amount of data and maps that are still being evaluated. It is not possible in this report to include all maps and sections or to do otherwise than summarise the results.
Frontier has drilled 134 holes totaling 6,144 metres, mainly at the Narrawa and Stormont prospects. The results of these holes are described under each prospect description.
The Stormont Project includes the Stormont gold/bismuth resource and nearby untested conductivity/magnetic anomalies and named prospects within EL 42/2010 such as Fletchers Adit, Ti Tree Creek and Lea River. The Stormont Project area as defined by the resource at Stormont itself, the numerous conductivity and magnetic anomalies similar to those at the Stormont resource and widespread traces of gold, is highly prospective and, based on the above, may yield additional gold resources. The current Indicated Resource at Stormont is 150,800t at 2.89g/t gold, 0.17% bismuth and 3.82g/t silver for 14,013ozs gold, 18,523ozs silver and 246t bismuth (Figures 16 and 17). Frontier, as at 25th April 2012, had drilled 75 diamond core holes for 2,997metres. The Stormont Project area lies on the southern and northern slopes rising out of the Lea River, west of Moina. The area is State Forest with plantation eucalypts over part much of the area.
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Figure 16: Stormont Resource Grade Plan Projected to Surface
Stormont resource grade plan projected to surface and drill hole collars. Refer also to Stormont grade cross section below.
Figure 17: Cross Section 2050 through Stormont Resource
For personal use only use personal For Cross section through Stormont resource illustrating the gold grades, near surface nature of the deposit, synclinal nature of the host environment, typical drill intersections and proximity to Stormont Thrust Fault.
74 Mineralisation is skarn type with economic gold and bismuth/bismuthinite mineralisation hosted predominantly in an actinolite+garnet skarn assemblage. The Stormont gold/bismuth deposit lies on or near surface, outcropping for the most part, the exception being in the southern part of the deposit where a thin layer of Tertiary basalt (and possible basal Tertiary clay?) overlies the mineralised CambroOrdovician sequence. Stratigraphically the youngest rocks of this sequence seen in the immediate Stormont area are the black shale which is intersected in the core of the syncline over the southern half of the deposit, though elsewhere nearby the limestone which overlies the shale is also partly preserved. Elsewhere in the Project area Gordon Limestone overlies the black shale unit and Moina Sandstone. Conformably underlying the shale are a unit of calcareous sandstones and siltstones of approximately 40m thickness. It is this unit in which skarn type mineralisation is found formed by replacement of the original precursor calcareous sediments. These calcareous sandstones in turn conformably overlie the massive quartz sandstones of the Moina Sandstone. In the Stormont deposit these Transition Beds lie in the core of a northwest trending open syncline. Gold plus bismuth mineralisation was introduced in the Devonian with the emplacement of the Dolcoath Granite, interpreted to lie approximately 500m below the Stormont deposit. Hydrothermal fluids carrying gold, bismuth and silver passed up the Stormont Fault until the fluids came into contact with reactive calcareous sandstones. Skarn mineralisation in the Transition Beds takes a number of forms with assemblages appearing to define a recognisable vertical sequence. The upper part assemblage is dominantly massive actinolite+garnet. It is in this zone where most gold plus or minus bismuth mineralisation occurs with gold found as fine grained free gold in association with bismuth and bismuthinite in fine veinlets and disseminations. Below this, magnetite becomes common with the assemblage actinolite+garnet+magnetite through to massive magnetite including wrigglite style (Kwak, 1981). In many instances, around this stratigraphic position, holes intersect pink fluorite veinlets as a swarm over a few metres, veins fibrous parallel to vein walls and with common magnetite selvedges. Underlying this, the skarn is commonly a lighter coloured pale cream, pink and/or green and is described in logging as calc silicate assemblage. It is not unusual to see dark green pyroxene skarn at the base of this calcsilicate but pyroxene skarn also occurs in a range of positions. Below this, recognisable sandstone textures become apparent. Mineralisation extends around the syncline in the upper portion of the skarn altered Transition Beds. Very occasionally gold is intersected in the lower part of the skarn. Geometrically on some sections it is appears that there are possibly two "onionskin" zones of higher grade gold extending around the syncline separated by a lower grade zone. Other than stratigraphic, the other major control on mineralisation appears at least in part due to the fault(s) which define or lie just inside the northeastern margin of the deposit. This fault runs along the backs of the southeastern end of the old workings, and has been called the Stormont Fault (Newnham, 1993) but is better known as the Stormont Adit Fault. It strikes 330 (true) and dips between 65 and 80 to the southwest. The fault does not appear to have offset the basal Moina Sandstone significantly with the orientations of this contact either side of the fault consistent with it being continuous around the core of a syncline. Higher grades are located along this structure though they are also found away from it. The other major geological structure of consequence is the Stormont Thrust which strikes northwest to northnorthwest and dips moderately to shallowly northeast. Previous interpretations stressed the role the thrust played in introducing mineralisation. The conclusion form the recent drilling is that it hasn't played a major role as a fluid conduit but has physically removed some mineralisation potential by replacing potentially mineralised Transition Beds with nonreactive Moina Sandstone. The Stormont gold and bismuth deposit contains 150,800t at 2.89g/t gold, 0.17% bismuth and 3.82g/t Ag using a 0.5g/t Au cutoff for 14,013ozs gold, 256 tonnes bismuth and 18,523 ounces silver (Figures 16 and 17 and Tables 5 and 6). The resource is classified as Indicated and thus ready for conversion to Probable Reserve with completion of a feasibility study and development of a mining plan. Drilling was done on nominally 12.5m spaced sections and the confidence in the resource is good. The Indicated Resource is 175m long and 35m wide. It extends to a depth of 35m below the surface though most of the deposit is approximately 25m thick. The central and southwestern side of the deposit conforms to the folded geometry with a curved base and an overlying central core of black shale. South of section 2100mE (local grid) the grades in the deeper part of the deposit fall, For personal use only use personal For leading to an artificial step in the bodies shape at this point.
75 PROSPECTUS
Southeast of section 2162.5mE the central part of the deposit is overlain by the black shale unit in the core of the syncline with grade shifting away from the western limb of the syncline to the eastern side, closer to the Stormont Fault. The geometry of the northeastern side of the orebody is defined by the Stormont Adit and Stormont Thrust Faults. Mineralisation on the northeast, i.e. footwall side, to the Stormont Adit Fault is more sporadic with some mineralisation extending 10m deeper between 2037.5mE and 2087.5mE. Metallurgy has shown the gold to be readily cyanide extractable though no work has been done on the extraction of the bismuth.
Hole No From (m) To (m) Interval (m) Au (g/t) Bi (%) Ag (g/t) SD1 4.5 19.5 15 3.5 0.4 0.5 SD36 0 16.7 16.7 2.07 0.03 n/a including 14.2 16.7 2.5 8.6 0.13 n/a SD39 0 19.6 19.6 2.87 0.09 n/a including 15.6 17.6 2 16.8 0.56 n/a SFD001 2.3 11.5 9.2 2.36 0.26 8.2 SFD002 4 10 6 2.6 0.64 17.8 SFD003 1.5 13.5 12 0.43 0.13 2.2 SFD004 1.7 13 11.3 3.38 0.31 6.2 including 8 11 3 10.5 0.31 6 SFD005 7.9 26 18.1 6.19 0.26 4.5 including 21.4 26 4.6 23.04 0.4 6 SFD006 1.8 19.3 17.5 1.3 0.08 2.5 SFD007 0 7.5 7.5 2.29 0.16 1.6 SFD008 0 9 9 1.66 0.08 1.3 SFD009 0 16.1 16.1 5.48 0.68 5.1 including 3.1 11 7.9 10.6 1.38 9.5 SFD010 0 24.5 24.5 0.45 0.01 1.1 SFD011 1 18 17 2.88 0.12 3.1 including 11.5 16 7.49 0.31 4.2 SFD012 4.8 16.1 11.3 0.328 0.02 1.8 SFD013 3.5 21.2 17.7 0.35 0.03 2.3 SFD014 27.7 32 4.3 0.21 0.02 2.2 SFD17 0.7 17.9 17.2 0.22 0.12 2.00 SFD18 1.1 18 16.9 0.43 0.13 2.9 SFD19 0.6 16 15.4 1.27 0.10 2.6 SFD20 0.5 28 27.5 4.83 0.08 5.1 including 4.5 18 13.5 8.34 0.13 7.9 including 22.4 28 5.7 2.76 0.04 3.3 SFD21 0.4 26.8 26.4 7.59 0.33 5 including 7.5 12 4.5 37.3 1.38 10.4 SFD22 6.7 15 8.3 5.14 0.08 2.98 including 12.5 15 2.5 13.36 0.09 5.48 SFD23 1.2 16 14.8 0.61 0.15 5.27 SFD24 1.5 13.5 12 5.58 0.19 5.5 including 10.5 13.5 3 17.28 0.60 12.5 SFD25 1.5 15.2 13.7 2.92 0.12 3.52 including 9 11.6 2.6 8.05 0.26 6.6 SFD26 0.3 18 17.3 0.43 0.007 0.72 SFD27 6 26.7 20.7 4.76 0.28 4.78 including 11.5 24 12.5 7.76 0.46 6.82 SFD28 5.8 30 24.2 0.74 0.09 1.2 SFD30 8 25.3 17.3 2.39 0.26 1.39 including 10 17 7 5.39 0.65 3.43 SFD33 10 26.8 16.8 8.02 0.50 5.2 including 14 18 4 18.62 1.00 9.5 including 23.1 25.3 2.2 25.8 1.73 14 SFD35 0.2 30.2 30 0.96 0.25 3.3 including 3.4 8 4.6 2.69 0.38 3.7 SFD36 13.5 25.5 12 0.6 0.08 0.75 SFD39 13 27 14 3.6 0.12 0.83 SFD41 9.1 12.7 3.6 0.18 0.002 0.8 SFD42 0 11.4 11.4 0.2 0.005 1.7 SFD43 0.5 20.3 19.8 1.04 0.13 2.1 SFD44 0.5 19.3 18.8 11.3 0.34 4.4 including 3.8 6 2.2 12.12 0.32 6 including 13 17 4 39.3 0.84 9.3 including 0.55 4 3.45 1.42 0.13 2.7 SFD46 4.5 12.5 8 0.67 0.07 11
For personal use only use personal For and 22.5 29.4 6.9 0.55 0.04 0.6 SFD47 15 26.2 11.2 3.3 0.11 2.7 including 17 20 3 9.97 0.14 6
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FRSTC01 2.0 10.0 8.0 1.09 0.29 5.3 FRSTC02 0.0 2.5 2.5 2.20 0.33 5.6 FRSTC03A 0.0 2.2 2.2 2.95 0.34 7.8 FRSTC03B 0.0 5.8 5.8 4.21 0.16 4.9 FRSTC04 0.0 1.3 1.3 25.40 0.55 8.0 FRSTC06 2.0 5.0 3.0 1.55 0.22 3.3 FRSTC07 0.0 15.2 15.2 2.44 0.24 3.8 FRSTC08 0.0 3.5 3.5 1.49 0.04 2.3 FRSTC09 0.0 11.0 11.0 6.01 0.21 6.3 Incl. 4.0 11.0 7.0 8.90 0.31 8.7 FRSTC10 0.0 0.7 0.7 5.65 0.04 2.0 FRSTC11 0.0 1.9 1.9 0.68 0.02 1.0 GFSTC01 0.0 19.0 19.0 10.00 0.77 4.2 Incl. 0.0 10.0 10.0 15.50 0.59 4.8 GFSTC02 0.0 4.0 4.0 3.10 0.19 2.0 GFSTC03 0.0 24.0 24.0 10.10 0.52 6.5 GFSTC04 0.0 12.5 12.5 4.63 0.26 4.2 GFSTC05 0.0 7.0 7.0 46.90 1.10 11.7 GFSTC06 0.0 1.2 1.2 36.53 1.10 6.0 GFSTC07 0.0 1.2 1.2 36.47 0.53 5.0 GFSTC08 0.0 1.2 1.2 12.46 0.50 2.0 GFSTC09 0.0 1.2 1.2 6.29 0.24 3.0 GFSTC10 0.0 1.2 1.2 11.20 0.47 3.0 GFSTC11 0.0 1.2 1.2 8.48 0.25 7.0 GFSTC12 0.0 1.2 1.2 3.71 0.13 3.0 GFSTC13 0.0 1.2 1.2 3.44 0.07 2.0 GFSTC15 4.0 34.0 30.0 5.08 0.57 2.0 The deposit converges with the hill slope at its northwestern end (though there remains the possibility of it continuing north of the River Lea Valley). Beyond the southeastern end of the Indicated Resource, mineralisation continues for over hundreds of metres southeast to section 2175mE, though recent drilling suggests it is becoming smaller and focused on the Stormont Adit Fault. Results to date are 8.0m at 1.8g/t gold in SD44 (from 13.5m), 1.3m at 3.0g/t gold in SD8 (from 28.7m) and 4.4m at 2.9g/t gold in SD10 (from 18.6m). Excellent opportunities exist for additional Stormont style deposits. Aimex Geophysics (July 2012) note as follows: “The Stormont deposit occurs within an interpreted syncline in the Moina sandstone and has an associated discrete low resistivity (conductivity) anomaly (Figure 15). The interpreted synclines occur as repetitive linear zones of low resistivity (<100.m) i.e., high conductivity in the 3DIP data. These interpreted synclines and associated conductivity anomalies may be host to additional Stormont type deposits. The Stormont skarn and associated magnetite also shows as a magnetic anomaly (Figure 15A) which has been used historically as a diagnostic tool in the search for other similar deposits. The Stormont deposit low resistivity (i.e., conductivity) anomaly and other similar conductivity targets may in part be due to disseminated pyrite and associated gold mineralisation. A total of 38 low resistivity (conductivity) and 2 chargeability anomalies (Table 7) have been identified as targets (Figures 15 and 18) for followup with surface geochemistry, mapping or drilling. Many of the targets occur beneath basalt cover and could represent untested bodies of mineralisation which collectively may add tonnage potential to the area.” The location of the deposit within a syncline is not coincidental. The skarn bearing host assemblages and overlying rocks are more easily eroded than the underlying Moina Sandstone and so are commonly only preserved in the cores of these synclines. Given the spacing and repetition, similar folds will be expected and are mapped for the most part from the western margin of EL 42/2010 across to Narrawa, certainly to Lake Gairdner. For much of this area the targeted rocks are obscured by a relatively thin veneer of Tertiary aged basalt and minor sediment. Figure 18 is an eastwest section which illustrates the conductivity anomalies beneath the basalt cover.
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Figure 18: Stormont Conductivity Cross Section – 5405825N
Shows a cross section on section 5405825N through the conductivity data at Stormont. Note the Stormont Resource location and the new targets, with similar conductivity, defined along the section line.
The presence of magnetite and pyrrhotite (magnetic minerals) in mineralised skarn has also long been recognised. Previous explorers have utilised aeromagnetics and ground magnetics surveys to search for further resources. The Stormont deposit corresponds to a magnetic anomaly high. Frontier enhanced the existing high resolution aeromagnetics data and defined a number of Stormont lookalikes in the data which have mostly seen little or no exploration. These anomalies included Western Syncline, Far West, Fletchers Adit, a number of anomalies around the Lea River fracture zone as well as a number of favourable linear (i.e. associated with fault) trends at Ti Tree Creek and around the Iris River bridge. One of the aims of the 3DIP was to see if Stormontstyle deposits have an IP/resistivity signature. To this end the survey has been highly successful with the low resistivity (high conductivity) data clearly mapping the Stormont deposit and the Western and Eastern Synclines and Far West prospect. In fact the conductivity data, as noted in the Aimex report above, shows as many as Many of these have coincident aeromagnetic highs. Almost all of these conductive trends lie beneath thin Tertiary basalt/sediment cover meaning they would not have been discovered by prospectors in the 19th and early 20th centuries. The table below lists the low resistivity (i.e., high conductivity) anomalies that require testing as described in the above Aimex Geophysics report.
TI1 418880e, 5405930n Stormont gold and bismuth deposit within an interpreted syncline occurring as a linear conductivity anomaly. TI2 418760e, 5405790n A 200m long conductivity anomaly 150m west of Stormont partly tested by drillhole SD20 with 6m @ 0.44g/t Au. TI3 418512e, 5405808n A 150m long conductivity anomaly 380m west of Stormont. TI4 419240e, 5405800n A 200m long conductivity anomaly 280m east of Stormont partly tested by drillholes SD15, 16 & 18 (which intersected 2m at 0.42g/t Au) beneath basalt cover. TI5 419009e, 5405950n The anomaly is 120m in length beneath basalt cover 100m east of Stormont with drilhole SD60 near its edge. TI6 419133e, 5406060n This anomaly is on an interpreted syncline beneathbasalt. TI7 419250e, 5405980n A 135m long anomaly on the same trend as TI6. TI8 419450e, 5405980n This conductivity anomaly is part of a dual anomaly with TI9 200m in length beneath basalt cover. TI9 419550e, 5406080n The second part of dual conductivity anomaly TI8/TI9. TI10 419700e, 5406100n Occurring on an interpreted syncline beneath basalt with depth extent to over 150m. TI11 419600e, 5406230n A small anomaly 160m on the same trend NNW to TI10. TI12 419870e, 5406230n A 170m long anomaly trending NW beneath basalt cover.
For personal use only use personal For TI13 420230e, 5406430n A 220m long conductivity anomaly trending NS. TI14 419393e, 5406510n Fletchers adit conductivity anomaly beneath basalt.
78 TI15 420600e, 5406520n A 200m long anomaly on a syncline beneath basalt. TI16 420780e, 5406590n A 200m long anomaly on a syncline beneath basalt. TI17 418720e, 5405380n This circular 100m diameter conductivity anomaly Can be inspected on ground and sampled. TI18 419580e, 5405660n One of four anomalies (TI18 to 21) on NNW trending interpreted synclines partly associated with interpreted ENE trending structures. These targets can be mapped on ground and sampled. TI19 420010e, 5406140n An elongated conductivity anomaly in between ENE trending structures. This 300m long anomaly can be mapped and sampled on ground. TI20 420240e, 5406210n One of four anomalies in between ENE trending structures. This 300m long anomaly can be mapped and sampled. TI21 420420e, 5406210n One of four anomalies in between ENE trending structures. This 360m long anomaly can be mapped and sampled. TI22 420840e, 5406190n This discrete circular conductivity anomaly occurs on an interpreted structure. TI23 420970e, 5406410n A 260m long conductivity anomaly called the TiTree Central Trend occurring between mapped basalt. TI24 418340e, 5406280n Discrete circular anomaly within Moina sandstone. TI25 418360e, 5406640n Elongated 300m long anomaly within Moina sandstone. TI26 418710e, 5406550n Elongated 450m long anomaly within Moina sandstone. TI27 418680e, 5406080n Discrete 80m wide anomaly within Moina sandstone. TI28 418960e, 5406600n Discrete 70m diameter anomaly beneath basalt. TI29 419840e, 5406740n A 200m long anomaly called Lea River trending NW occurring beneath mapped basalt. TI30 420230e, 5406910n A 200m long anomaly trending NS on a syncline in basalt. TI31 420950e, 5406910n This 600m long conductivity anomaly occurs within a syncline called the Zabriskie Trend beneath basalt. TI32 421080e, 5407020n A NW trending anomaly 400m long beneath basalt. TI33 421470e, 5406250n Occurring on a syncline 240m long beneath basalt. TI34 421630e, 5406350n A 160m long anomaly called Link Trend beneath basalt. TI35 421430e, 5406900n Iris Bridge Trend anomaly on a syncline recommended for mapping and sampling. TI36 421400e, 5406620n A 200m long NS anomaly on the edge of mapped basalt. TI37 421050e, 5407240n Heggars Trend conductivity anomaly beneath basalt. TI38 421110e, 5407390n A 150m long anomaly beneath basalt. TI39Chg 420880e, 5407360n A 200m diameter chargeability anomaly with a conductivity anomaly at its centre on a NE trending structure and on the contact between mapped basalt and Moina sandstone. TI40Chg 418550e, 5406640n An 800m by 500m chargeability anomaly within Moina sandstone possibly caused by pyrite. The anomaly is host to the elongated conductivity anomalies TI26 & 28.
Most of these anomalous geophysical trends have seen no exploration with only the Western and Eastern Synclines, Fletchers Adit and Ti Tree Creek anomalies having been tested and these with a relatively small number of poorly targeted holes (given the enhanced aeromagnetics and new conductivity anomalies). Drillhole results at the Western Syncline are 2.0m @ 3.5g/t gold in ST04 and 3.0m @ 1.34g/t gold in SD51 though the magnetics and conductivity clearly show the drilling to be off the prime axis for drilling.
Eight short holes were drilled north of Fletchers Adit on the north side of the River Lea by Goldfields Exploration (Little River, 1993). All holes intersected mineralised skarn with FD7 and FD8 returning 2.0m @ 1.5g/t gold and 21.0m @ 0.3g/t gold respectively. Drilling has not yet tested the skarn adjacent to the Fletchers Adit Fault. Hole FD8, the most northerly hole, intersected the thickest skarn sequence indicating that the body is thickening northwards beneath the basalt cover.
A total of eight holes have been drilled over the years at Ti Tree Creek. Most holes intersected gold anomalous skarn. Again, enhanced magnetics in conjunction with the 3DIP conductivity data indicates that most holes test the flanks of these anomalies.
Torque Mining intends to develop and mine the Stormont deposit and to explore the many other Stormont analogs for further high grade gold plus bismuth resources. The manportable diamond drill rig is ideally suited to testing these shallow, openpittable
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79 PROSPECTUS
The Narrawa Project includes the Narrawa/Higgs resource and nearby named prospects within RL 3/2005 such as Narrawa Reward, WestHiggs, Packetts, West Packetts, Poveys, Blacks and Three Sisters (Figures 2 and 3). The Narrawa Project has a current . See Section 3.7.2. The potential to increase these resources is excellent based on the recent geochemical soil surveys and 3DIP survey results. The Narrawa project is likely to develop into a significant mining camp with substantial additional drilling. The Narrawa Project occupies the valley of the east flowing Narrawa Creek which drains into the Lake Cethana hydro impoundment. Frontier, as at 25th April, 2012, had drilled 59 diamond core holes for 3,147 metres. The area is state forest and is covered by dry sclerophyll forest, commonly with a low dense bauera/teatree understory making foot access somewhat difficult. In spite of the moderate to high relief vehicle access is possible in most parts of the project area due to previous historic mining, forestry and recent exploration. The project area encompasses a near surface (though with considerable depth potential) polymetallic mineralising system in a thrust bound block of faulted Moina Sandstone – siliciclastics sediments (i.e. sandstones and lesser gritty and calcareous sandstones) on the margin of a highly fertile, fractionated Itype granite. The granite was emplaced passively into this already extensively faulted sequence in the Middle Devonian Tabberrabberan orogeny as a late stage event postdating both folding events and thrust and strike slip faulting. Trace element soil geochemistry maps more highly fractionated phases showing the granite body to contain a number of phases. Porphyry and aplitic dykes extend in a westnorthwesterly direction from the margin of the granite through the Narrawa Creek valley. The granite itself is commonly greisenised on its margins. Geophysics supported by some drill intercepts indicate that a granite spine persists westwards beneath the Narrawa Valley less than 500m deep. The sediments are commonly either altered to assemblages such as biotite hornfels, calcsilicate hornfels and a variety of actinolite plus or minus epidote, garnet, pyrrhotite, gold, lead and zinc sulphide skarns by hydrothermal fluids emanating from the intruding granite and associated dykes. Hydrothermal fluids utilised the existing plumbing system of interconnecting thrusts, back thrusts and strike slip faults. The sedimentary sequence is also folded in the valley with steep limbs on west to westnorthwest trending folds. Targeted economic gold plus base metal mineralisation (i.e. Narrawa Higgs Resource) occurs as stratiform and stratabound semi massive sphalerite and galena in biotite altered sandstones with pyrrhotite the common iron sulphide phase. Gold is more erratic within the mineralised zones suggesting a separate, though broadly coincident, gold bearing phase. Base metals also occur as late stage veins within these lodes, interpreted as later remobilisation of existing sulphides. Mineralisation is considered to have been introduced by hydrothermal fluids derived from the intruding granite into an existing faulted sequence with preferential alteration/replacement of particular beds. Recognition of the faulted geometry in 3D in conjunction with the newly acquired 3DIP chargeability and resistivity data and modelled magnetics allows targeted drilling. This approach already indicates that the Higgs trend has not been tested towards the granite contact as had been expected.
Other mineralisation styles in the Narrawa Project area consist of high grade tungsten, plus or minus molybdenum, bismuth, and tin in quartz veins and altered dykes. Recent drilling has intersected 9% molybdenum over 30cm. Workings on the ridge southeast of Higgs i.e. Squib, Sayers and Blacks were targeting this style as was the All Nations mine to the southwest. A further style of targeted mineralisation is gold in disseminations and sheeted veins and stockworks in and on the granite margins. Anomalous gold at Packetts and West Packetts and Tin Spur on the other side of Lake Cethana are consistent with this style. The Hugo gold, zinc and bismuth skarn deposit lies immediately adjacent to the Narrawa project area with the skarn assemblage postulated to extend into Torque's ground where it would be obscured by overthrust Moina Sandstone, emplaced along the Hugo Thrust. This interpretation is supported by elevated magnetics along this trend. The Narrawa Resource (based around the old Higgs workings) contains 162,800t at 2.11g/t gold, 1.42% lead, 1.2% zinc and 20.5g/t silver in the Indicated Category, 46,600t at 2.07g/t gold, 0.98% lead, 0.81% zinc and 16g/t silver in the Inferred Category (Geostat, 2009 and MacDonald 2009).
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80 Figure 19: Narrawa Resource Grade Plan Projected to Surface Drill hole traces also shown.
The orebody consists of four westnorthwest striking stratiform and stratabound mineralised "lodes" (i.e. 100, 200, 300 and 400 lodes) dipping 65 to 70 north northeasterly near the base of the 30 slope⁰ on the southern⁰ side of Narrawa Creek. The upper ⁰ parts of the 100 lode were worked in the 30's with three short adits and open stoping to the surface.
Channel sampling and a number of phases of diamond drilling by CRAE, Goldfields Exploration and Jervois as well as Frontier, have defined the resource around the 100, 200 and 300 lodes from surface to a depth of 60 metres. Table 8 lists the drill intercepts which define the resource. The current base of the resource is defined by a moderately steeply southsouthwest dipping fault. It is not clear whether this structure is offsetting or bounding the resource. The former is favoured as the fault appears to be the continuation of structures mapped northwest of Narrawa. To date the offset portion has not been located though if the fault is a back thrust as is likely (assuming analogy with similarly oriented structures elsewhere in the Moina region) then the offset portion of the resource will be at depth. To the west the resource is apparently truncated by a strike slip fault, however, mineralisation of Higgs style is found west of the fault at West Higgs with channel sampling along the strike of the lode assaying 16.8m at 8.5g/t gold (including 4.3m at 27.3g/t gold), 18.7m at 6.3g/t gold (including 2.0m at 34.2g/t gold) and 5.5m at 1.7g/t gold. Drillhole assays for NC09 were 1.3m to 1.7m, 0.4m at 3.28g/t gold; NC10; 39.9m to 41.1m, 1.2m at 1.82g/t gold; and ND1; 92m to 93m, 1m at 5.76g/t. The eastern boundary of the resource was defined by grade, however, the limited drilling along strike (including NC16, 3.7m at 1.11g/t gold from 23.8m) beyond the resource boundaries has been shown by the 3DIP to have been largely drilled off the Higgs trend and thus the resource is open for over 600m in this direction. 100 NC06 14.5 20.5 6 5.22 6.95 0.02 1.24 0.96 100 NC07 15.6 24.6 8.9 1.48 12.1 0.08 0.28 0.97 100 NC08 14 17 3 0.55 0.5 0.007 0.003 0.004 100 NC12 15.25 32.5 17.25 3.11 26.6 0.05 2.45 1.78 100 NC22 48 66 18 0.99 76.8 0.1 5.75 3.76 100 NC43 18.4 33 14.6 2.13 21.7 0.07 1.56 1.62 100 NC44 18.1 35.9 17.8 3.45 12.7 0.11 0.71 0.53 100 NC45 18 25.2 7.2 0.73 3.21 0.02 0.01 0.03 100 NC47 14.5 25 10.5 1.04 9.3 0.05 0.63 0.69 100 NC48 16 30 14 1.58 12.5 0.04 0.9 1.03
For personal use only use personal For 100 NC50 24 43.1 19.1 0.25 42.6 0.04 3.23 2.35 100 NC51 27 41.6 14.6 0.75 34.7 0.085 2.04 2.09
81 PROSPECTUS
100 NCCS10 0 4.1 4.1 6.55 1.23 0.035 0.09 0.017 100 NCCS13 3 9 6 0.78 0.67 0.007 0.05 0.004 100 NCCS2 0 5 5 7.1 34.6 0.045 2.43 1.83 100 NCCS3 0 2.4 2.4 6.32 10.7 0.08 1.25 0.022 100 NCCS4 0 7.5 7.5 4.38 21 0.03 0.75 0.44 100 NCCS9 0 2.3 2.3 8.05 0.5 0.05 0.065 0.007 200 NC06 6.2 11.05 4.85 1.14 4.15 0.02 0.41 0.33 200 NC07 4.8 10.3 5.5 1.15 0.5 0.17 0.31 0.07 200 NC12 7.1 14.6 7.5 5.29 12 0.04 1.08 0.89 200 NC20 11.6 14.5 2.9 0.26 0 0 0.11 0.045 200 NC43 11.5 15 3.5 3.23 9 0.05 0.49 0.45 200 NC44 11.6 17.1 5.5 2.35 15.8 0.07 1.15 2.37 200 NC45 14 18 4 0.88 4.25 0.06 0.26 0.11 200 NC47 3.1 10.5 7.4 0.29 10.5 0.1 0.295 0.24 200 NC48 4 9 5 0.42 10.1 0.09 0.27 0.36 200 NC49 6 9 3 0.26 10 0.11 0.13 0.18 200 NC50 11.6 15.9 4.3 0.61 3.3 0.03 0.15 0.26 200 NC51 17 23 6 2.19 8.2 0.09 0.31 0.42 200 NCCS12 0 8 8 2.36 2.25 0.01 0.07 0.01 300 NC23 57 65 8 0.02 9 0.02 0.71 0.47 300 NC27 39 49.3 10.3 4.1 9.5 0.13 0.61 0.62 300 NC28 32 49 17 0.68 24 0.14 1.07 1.46 300 NC29 42.75 57.1 14.35 1.85 26.3 0.09 1.75 1.25 300 NC32 32.5 41.7 9.2 0.06 27.2 0.09 1.76 1.6 300 NC34 10.3 21.9 11.6 0.48 10.5 0.1 0.47 0.46 400 NC06 40.85 42.3 1.45 0.01 17.4 0.02 1.085 1.12 400 NC12 36.2 38 1.8 0.93 57.1 0.09 2.48 0.48 400 NC43 46.3 51.3 5 0.08 13.4 0.04 0.53 0.53 400 NC47 39 46 7 0.03 11.9 0.03 0.58 0.46 400 NC50 45 48 3 0.01 21 0.04 1.6 0.71 400 NC51 59.6 61.6 2 0.01 16.5 0.03 0.54 0.84 There are excellent opportunities to add to the Narrawa/Higgs resource in the Narrawa Valley with numerous examples of anomalous gold+/base metals in outcrop, soils and drilling in analogous settings to the Higgs lodes. Anomalous gold in soil samples extend for over 1km of strike through the valley. Previous work has targeted these soil anomalies, old workings and VLFEM/UTEM conductive trends. Many of these targets remain untested with a number due to difficulty of access, a problem overcome by Frontier's manportable rig. The recently completed 3DIP has added immensely to understanding the subsurface geology and in defining and mapping mineralised trends. In particular the resistivity data, or more particularly the inverse of this, conductivity, maps out mineralised trends in some detail (Figure 20). The 3DIP resistivity lows are equivalent to conductivity highs. Thus blue (cool) zones in resistivity images represent conductive rocks. Pyrrhotite and chalcopyrite, common gangue minerals in the Higgs lodes, are excellent conductors and so it is not surprising that the Higgs lodes correspond with resistivity lows. This is apparent in plan but is also shown very clearly in section 4590 (Figure 21).
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82
Figure 20: Conductivity Anomalies 75m Depth Slice, Narrawa Area
Conductivity anomalies in the Narrawa area showing relationship of Narrawa resource to the Narrawa conductivity anomaly (close correlation) and to further conductivity targets defined by the consultant geophysicist. Also shown are individual gold occurrences at Narrawa.
Figure 21: Conductivity Section Through Higgs – Narrawa Reward
Showing the extent of the conductivity anomaly at depth and the untested nature of the Narrawa Reward side. This is a prime target to increase the overall resource at Narrawa. The conductivity anomaly below the Hugo Thrust may represent an extension of the Hugo Skarn deposit into Torque’s tenement.
Subparallel blue (low) fingerlike trends extend westnorth westerly to northwesterly from the margin of the Dolcoath Granite through the Narrawa Valley. The Higgs trend hosts the Narrawa deposit and extends 300400m towards the granite with the few drill holes in this region drilled to the north of the trend. West of this resource the conductivity trend appears to jog across a structure and merge with the Packetts trend, potentially explaining the structural complexity in this part of the resource. Other clearly defined conductive trends include: Narrawa Reward trend which merges with the Big Sister trend thus extending over 1km in strike. This trend is further detailed below but is already known to host the 500 lode, the Narrawa Reward lode as well as extensive cover of Au anomalous soil geochemistry. Middle Sister trend Little Sister trend which strikes for 300400m and hosts the NC04 prospect.
Waterfall trend which corresponds to outcropping skarn mineralisation in Narrawa Creek. For personal use only use personal For West Higgs/Packetts trend which strikes for 600m and appears to host the westerly extension of the Higgs resource.
83 PROSPECTUS
Channel sampling of historical surface workings by GFEL along the strike of the lode returned assays of 16.8m at 8.5g/t gold (including 4.3m at 27.3g/t gold), 18.7m at 6.3g/t gold (including 2.0m at 34.2g/t gold) and 5.5m at 1.7g/t gold. This highly anomalous zone has been inadequately tested by only three drillholes due to the steep terrane with ND1 intersecting 20m at 0.5g/t gold from 83m including 1m at 5.76g/t gold from 92m and NC10 1.2m at 1.82g/t gold from 39.9m. The zone remains untested along strike to the west and has excellent potential for further gold mineralisation. Torque's man portable diamond drill rig will allow testing of this zone. A few holes which were extended beyond the 100 lode have intersected a similar oriented lode deeper into the 100 lodes footwall. Drilling is limited to date but there is clear potential to grow this lode with further drilling. Extensive Au soil anomalism on the slopes south of Higgs and West Higgs may be reflecting the presence of this lode subsurface. North of the Narrawa Creek gold plus base metal skarn style mineralisation outcrops along the side of the track into the valley, was exposed in trenches and has been intersected in a number of short holes. The body, known as the 500 lode, is shallowly north dipping and is semimassive sulphide of the Higgs type. Channel sampling gave 0.8m at 5.79g/t gold, 3.72% lead, 5.83% zinc and 48g/t silver. Intersections were 25.2g/t gold in NC25 (from 0m), 2m at 4.26g/t gold, 11g/t Ag, 0.86% lead and 0.64% zinc (from 0m), and 1.4m at 4.34g/t gold, 33g/t silver, 2.76% lead and 3.91% zinc (from 9.5m) in NC01, 2.0m at 15.0g/t gold in NC35 and 31.9m at 1.2g/t gold in NC36. The lodes downdip continuity is confirmed by the intersection in DD82DG1 from 94.5m to 98.2m of 3.7m at 0.39g/t gold, 18g/t silver, 1.2% lead and 1.25% zinc. Other than this one intersection the lode remains untested at depth. Intersections in NC3 (1m at 1.17g/t gold from 16m), NC16 (3.7m at 1.11g/t gold from 23.8m), NC17 (2.2m at 0.12g/t gold, 15g/t silver, 0.79% lead and 3.26% zinc from 35.6m) and NC23 (1m at 0.84% lead and 1.13% zinc from 28m) lie between the 500 lode and Higgs lode trends and appear to define a separate 600 lode trending parallel to the 100, 200 and 300 lodes and extending towards the granite margin along the Higgs conductivity trend. Previous interpretations had most of these holes testing the Higgs lode trend, however, 3DIP shows them to lie north of the Higgs trend leaving the 700+m to the granite contact almost completely untested. Gold bearing skarn outcrops on the south side of Narrawa Creek east of Higgs at the NC04 prospect. Anomalous gold in soils to 0.72 and 0.27g/t gold was tested by DDH NC04 which intersected 6.9m at 0.84g/t gold. Only one subsequent hole has tested this trend with NC42 intersecting 0.5m at 2.21g/t gold (from 25.5m). Recent channel sampling by Frontier has returned 10m at 0.96 g/t gold and 12m at 2.8g/t gold, the latter channel including 2m at 11.7g/t gold. The Narrawa Reward adit follows a westnorthwest trending sheared skarn body for a short distance. Channel sampling by Goldfields Exploration assayed 4.0m at 3.1g/t gold and 32m at 2.0g/t gold (along strike of lode). The trend has only been tested by two DDH's with NC02 assaying 2.4m at 2.53g/t gold, 60.6g/t silver, 0.58% lead and 1.03% zinc (from 12.8m). This deposit lies on the Narrawa Reward/Big Sister conductivity trend. South and upslope of the Higgs workings are a series of trenches and shallow workings known as the Packetts and West Packetts workings. Historic data reveals that prospectors were finding disseminated gold in weathered sandstone. Recent channel sampling has assayed anomalous gold, however, extensive areas of anomalous gold in soils extend northwestwards from Packetts along an unnamed conductivity trend has only been tested by NC13 (1m at 2.4g/t gold from 56.6m) and NC14 (1.85m at 1.16g/t gold from 32.15m). The Narrawa Project has excellent potential for high grade or bulk tonnage tungsten plus or minus molybdenum, bismuth, and tin mineralisation around the margin of the Dolcoath Granite. The Squib workings historically produced a total of 34.5t of tungsten and the All Nations 36t. The Shepherd and Murphy mine (nonTorque) immediately west of All Nations produced 255t tungsten, 71t bismuth and 525t tin (Jennings, 1979).
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84 Numerous old workings in the Narrawa region, i.e. Squib, Blacks, Poveys, Southern Wolframite Lode, Bateman's, Princess and Sayers had tungsten mined from discrete narrow lodes from a few cms to 0.5m wide in westnorthwest striking quartz veins or porphyry dykes with high grade wolframite, molybdenite, bismuthinite and cassiterite on the margins. Samples from mullock heaps have assayed over 5% tungsten and 9% molybdenum. Similar old workings in the All Nations area to the southeast of Narrawa i.e. All Nations, Lawkemlaw, Pochins and Pig & Whistle; and on the eastern side of Lake Cethana i.e. Hidden Treasure, Kenzies, Premier and ML1414M all attest to the area's mineralisation potential. The prospectivity of the rocks around the margin of the Dolcoath Granite and Moina Sandstone has been further confirmed by Frontier's 2011 soil sampling program with extensive anomalous tungsten, molybdenum, bismuth and tin (see Figures 9 and 10). Historically there has been very limited drilling targeting this style of mineralisation in the Narrawa area. DD82DG1, testing the zone between the Big and Middle Sisters magnetic anomalies, intersected anomalous tungsten and molybdenum including from 166.5m to 167.0m, 0.5m at 1.26% tungsten and 0.12% molybdenum. NC53 under the Squib workings intersected from 21.7m depth, 10.5m at 0.23% tungsten in greisenised granite. The Squib, Blacks and Poveys (and the Sayers workings) were worked on for lode style tungsten, plus or minus molybdenum, bismuth, and tin. Excellent potential exists for both high grade lode style tungsten, plus or minus molybdenum, bismuth and tin, and lower grade bulk tonnage mineralisation in greisenised granite and pegmatite. On the northern margin of the granite a discrete quite coherent zone of niobium and yttrium anomalism in Frontier's 100m x 50m soil sampling represents the surface expression of a more highly fractionated granite phase and therefore more fertile and potentially mineralising, an interpretation supported by the presence of beryl in a two inch vein in the Sayers workings on the ridge.
Aimex commented as follows: “Within the Narrawa survey area, synclines have been interpreted from elongated low resistivity zones (high conductivity) (<100.m) in the 3DIP resistivity imagery (Figure 20).
Polymetallic mineralisation and targets occur in a thrust bound block of faulted Moina Sandstone between the Hugo and Machinery Creek thrusts, on the margins of fractionated Itype granite.
The Narrawa deposit is also associated with an elongated resistivity low or conductivity high anomaly which represents a diagnostic tool for generating other similar targets to help expand tonnage potential of mineralisation in the area. The historical airborne magnetic survey data indicates shear zones and identifies the Dolcoath Granite as a distinct magnetic low.
Seventeen geophysical targets have been identified within the Narrawa survey block (Figure 20), all occurring within the thrust package between the Machinery Creek Thrust and Hugo Thrust. Those targets are briefly described below in Table 9.
NA01 425500e, 5406600n NarrawaHiggs Indicated Resource of 162,800t at 2.11g/t Au + 1.42% Pb + 1.20% Zn + 20.6g/t Ag within a conductivity anomaly trending southeast with potential for additional tonnage to the southeast towards the granite. NA02 425520e, 5406460n A 250m long NW trending resistivity low (<100.m) adjacent to the Packetts workings and channel sampling. NA03 425070e, 5406590n A 160m long NW trending resistivity low at 25m depth. NA04 425328e, 5406730n This 170m long elongated conductivity anomaly hosts the West Higgs prospect. NA05 425840e, 5406720n This elongated 350m long conductivity anomaly is trending southeast and adjacent to the Higgs deposit. The anomaly persists to 100m depth on a structure leading to the granite and is within anomalous gold in soils. NA06 425420e, 5406880n A 170m long conductivity anomaly 200m north of Higgs within anomalous gold in soils. NA07 426480e, 5406630n This conductivity anomaly occurs within the margins of the outcropping Dolcoath Granite 200m east of Blacks Lower Shaft. NA08 426630e, 5406580n Surface workings occur within this 100m long NNW trending conductivity anomaly on the margins of Dolcoath Granite. Coincident with a similar sized chargeability anomaly at 50m depth. NA09 426950e, 5406540n A 100m long elongated conductivity anomaly at 100m depth within the margins of the Dolcoath For personal use only use personal For Granite. Partly coincident with a chargeability anomaly at surface.
85 PROSPECTUS
NA10 426500e, 5406460n A discrete conductivity anomaly adjacent to the Southern Wolframite Lode within the Dolcoath Granite. NA11 426060e, 5406850n Partly coincident with surface gold in soil geochemistry, a 200m long elongated conductivity anomaly. NA12 425350e, 5406380n A circular conductivity anomaly from surface and becoming more intense and larger at 200m depth. NA13 424550e, 5406630n A 450m by 250m chargeability anomaly at 200m depth within Moina Sandstone. It overlies a resistivity anomaly and may be related to pyrite. NA14 425480e, 5407240n A discrete circular 150m diameter chargeability anomaly. NA15 424570e, 5406900n This 150m long elongated conductivity anomaly occurs within Moina Sandstone down to over 100m depth. NA16 425200e, 5406980n A circular conductivity anomaly on a syncline. NA17 426290e, 5406770n An elongated conductivity anomaly coincident with Poveys & Johnsons workings on the margin of the Dolcoath Granite. Torque commissioned Swain Engineers in June 2012 to carry out a Scoping Study in respect to mining and processing the Indicated Resources at Narrawa and Stormont. Swain Engineers made the following recommendations:
“This Scoping Study indicates the potential of a satisfactory investment which will yield a future source of income to the shareholders of Torque Mining Limited. We recommend that a Full Feasibility Study commences without delay.”
The Study was completed by David Swain of Swain Engineers. David Swain is a Fellow of the AustIMM, is a competent person as defined by the JORC Code and consents to the publication of this Study. The Company has entered into a Joint Venture with BCD whereby, subject to a favourable Feasibility Study and Mine Environmental Permitting, and grant of a Mining Lease, the Indicated Resource at Stormont will be processed through BCD’s gold processing facility at Beaconsfield, Tasmania.
Although the Scoping Study suggests that the existing resources at Stormont and Narrawa may warrant development by the construction and operation of a processing plant in the Moina District, the Torque Board is of the opinion that this would be a highrisk strategy for Torque at this stage of its history. The Board considers that before a processing plant is built at Moina further resources should be defined.
Consequently, the Board has concluded that in the short term, the best development strategy for Torque is through an alliance with BCD, although this means that some of the recovered gold, in excess of expenses, will go to BCD.
The Joint Venture Heads of Agreement is described in the Material Contracts section of this Prospectus. In summary the terms are as follows:
BCD will provide all funds required to complete Feasibility, development and permitting of the Stormont gold body as it is presently defined through to production.
All costs by BCD and the Joint Venture including all mining, processing and direct management costs incurred at actual cost (no mark up) under an “open book” agreement.
There will be no additional management fee charged to the Joint Venture.
The net cash flow after all expenses for all gold sold at US$1,700/oz or less will be split between Torque 45%, Frontier 5% and BCD 50%.
The additional net cash flow resulting from gold sold at prices greater than US $1,700/oz will all revert to Torque/ Frontier.
There will be a prepayment to Torque by BCD of AUD$500,000 at the commencement of production, to be repaid to BCD from Torque’s share of production.
For personal use only use personal For The present Joint Venture is restricted to the existing resource at Stormont Prospect and does not include any possible expansion of the Stormont Resource or other resources that may be defined at the Moina Project.
86 Torque and BCD note that this agreement or some modified agreement may be extended to the Narrawa Resource or any other resource defined by Torque at Moina, subject to the mutual agreement of both parties. Gold, base metal and tin mineralisation is known to occur in the Bell Mt, Tin Spur and Round Mt areas of the Moina Project.
Soil sampling, 3DIP and data review has been completed in those areas but a complete analysis of projects has not yet been completed by Torque. This is an ongoing evaluation.
At Bell Mt, where gold is/has been recovered from alluvials, the consultant geophysicist has defined some favourable mineralised structure and anomalies, one or more of which could be a source for the alluvial gold. These targets are shown on Figures 22 and 23 – conductivity slice at 50m depth and chargeability slice at 75m depth respectively. The targets will be sampled at surface, mapped and drilled.
Figure 22: Conductivity Anomalies 50m Depth Slice Figure 23: Chargeability Anomalies, 75m Depth Slice, Surrounding Bell Mt Goldfield Bell Mt Goldfield
Shows conductivity anomalies, 50m depth slice Shows chargeability anomalies, 75m depth slice surrounding the Bell Mt alluvial goldfield with surrounding the Bell Mt alluvial goldfield with conductivity and chargeability targets as defined by the conductivity and chargeability targets as defined by consultant geophysicist. consultant geophysicist.
The SMRV Project covers all of the MRV south of Macquarie Harbour in southwestern Tasmania a strike length of approximately 45 kilometres. The area is held under two granted tenements, EL20/96 Elliott Bay and EL 33/2010 Wanderer River (Figure 14).
The two granted tenements cover an area of approximately 221 square kilometres. Torque has acquired a 90% interest in the two granted tenements from Frontier in consideration of the issue of shares. Exploration and Management Consultants Pty Ltd (1998)
For personal use only use personal For retain a 10% free carried interest in the tenements to completion of a bankable feasibility study.
87 PROSPECTUS
This southern end of the MRV, a belt of Cambrian calcalkaline felsic to mafic volcanics has been significantly underexplored in comparison with the much better known northern section of the volcanic belt. This northern section covering approximately eighty kilometres of strike of similar volcanics from Hellyer to Mount Darwin hosts the substantial mineralised deposits listed in Table 1.
The project has proven potential for: large tonnage high grade zinc, lead, silver, gold, copper polymetallic volcanic hosted massive sulphide (VHMS) mineralisation e.g. Wart Hill deposit hybrid VHMSepithermal high grade Au mineralisation e.g. Sassy Creek This minralisation is VHMS mineralisation similar to that at the Rosebery, Cue River or Hellyer Mines (or former mines). The minimum sized mineral body in the SMRV environment likely to be economic is estimated at 10Mt at grades of 12 to 20% combined zinc and lead (plus silver and gold credits). The maximum size deposit likely to be defined would be approximately 30Mt at similar grades to the minimum size target. The above tonnages and grades are approximate and no financial study has been completed to more accurately ascertain the minimum tonnes and grade likely to be economic in the SMRV tenements. This target is based on exploration and drill data, summarised below, and described in detail in Section 4 of this report. This mineralisation is hybrid VHMS – epithermal mineralisation similar to that at the Henty Mine, north of Queenstown, Tasmania. The Exploration Target is 2Mt to 4Mt at a grade of 10 to 15g/t gold plus credits in lead, zinc and silver. The above tonnages and grades are approximate and no financial study has been completed to ascertain the minimum tonnes and grade required for an economic deposit in the SMRV Project. Mineralisation similar to the Henty Mine has been intersected in a drill hole in the SMRV Project and relevant exploration results relating to this Target are described fully in Section 4 of this report. In respect to the Exploration Targets above, it must be noted that the potential quantities and grades are conceptual in nature, that there has been insufficient exploration to estimate a Mineral Resource (except at the Wart Hill prospect) and that it is uncertain if further exploration will result in the estimation of Mineral Resources additional to those at Stormont and Narrawa. A geological review of the projects potential confirmed: Presence of VHMSstyle base metal massive sulphides of very highgrade at the Wart Hill prospect and thus potential for a very high grade deposit. Drill results which support the Exploration Target are quoted below and all drill results are shown in Tables 10, 11, 12 and 13.
Lens A 4.0m at 0.16% copper, 10.2% lead, 17.9% zinc, 132g/t silver and 0.6g/t gold Lens B 3.0m at 0.2% copper, 13.9% lead, 21.9% zinc, 680g/t silver and 0.8g/t gold WH8 1.1m at 0.27% copper, 10.4% lead, 24.7% zinc, 123g/t silver and 0.63g/t gold WD025 0.75m at 0.87% copper, 14.6% lead, 28.6% zinc, 48g/t silver & 1.04g/t gold WD025 0.75m at 1.39% copper, 12.8% lead, 27.4% zinc, 75g/t silver & 4.9g/t gold WD025 7.1m at 0.35% copper, 5.58% lead, 11.18% zinc, 58g/t silver & 1.48g/t gold WH10 5m at 0.26% copper, 2.97% lead, 6.04% zinc, 1.35g/t gold & 32g/t silver WD009 7.0m at 0.22% copper, 3.33% lead, 6.16% zinc, 1.81g/t gold & 56g/t silver Presence of the highly sought after horizon, host to the VHMSstyle orebodies in Tasmania’s Mt Read Volcanics. The project area contains approximately 40 strike kilometres of the "holy host" horizon. Potential for the Sassy Creek/Pleiades gold anomalous alteration zone to either represent VHMSstyle footwall alteration beneath a massive sulphide deposit to the west; or to be a standalone Au deposit in a hybridVHMS system, such as the Exploration Target above.
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88 Access to the area is by barge to the north of the Lewis River, or by helicopter from Strathgordon or Strahan. A rough, unformed track also exists from Birch Inlet on Macquarie Harbour to Low Rocky Point (south of Wart Hill) and a gravel airstrip at Moores Valley has been used in the past. This track was originally used on a regular basis to service a lighthouse at Low Rocky Point, but has fallen into disuse. Other tracked vehicle tracks exist to and along much of the length of the Wanderer River licence. The area is exposed to the southwesterly weather that dominates the western side of Tasmania. Even in summer this can mean continuous days of persistent drizzle or driving rain.
Both of these factors make exploration more difficult than at the Moina Project.
Certain sectors of central and southwest Tasmania are World Heritage listed. The MRV (and some areas of volcanics on the Sorell Peninsula) have been specifically excluded from this listing on the basis of their mineral prospectivity.
Prior to the World Heritage listing all areas were classified as part of the South West Conservation Area. In 1992, the Tasmanian Government proclaimed the prospective rocks south of Macquarie Harbour to be within the Sorell Peninsula Prospectivity Zone in recognition of the mineral potential of the area. Any change in the status of the land within the Zone requires approval of both houses of the Tasmanian parliament with any affected party entitled to compensation.
Within the SMRV tenements, the MRV can be divided into two main areas, the Wanderer RiverThirkell Hill area and the Elliott Bay area. The SMRV is separated from the main belt of MRV north of the Gordon River by a Tertiary graben (Moores Valley).
The geological understanding is hindered by relative lack of drilling and the nature of the surface outcrops, which are generally leached and bleached. The general geology is shown on Figure 14. A major period of volcanic eruption in the Cambrian period resulted in the development of the MRV. A chain of volcanoes developed along the eastern edge of a water filled rift, which developed in the Tasmanian continental crust forming an arcuate ocean basin.
The initial volcanism was predominantly rhyolitic – dacitic in composition. The main unit, the feldspar phyric Central Volcanic Complex, is host to the Rosebery (Berry 1998 and Lees 1990) and Hercules VHMS deposits and the ‘footwall style’ Mt Lyell copper deposit (Hills, 1990). The predominantly quartzfeldspar phyric Eastern Quartz Phyric Sequence (EQPS) erupted to the east. The volcanics of the Elliott Bay area are lithologically similar to the EQPS.
This was followed by a phase of andesiticbasaltic volcanism with further rifting focused to some extent on the Henty fault system. Major units are host to the Que River and Hellyer VHMS deposits and may also mark the time at which the Mount Lyell deposit formed (Hills, 1998).
Further rifting occurred on the Henty fault system followed by the mainly felsic final phase of volcanism. Coeval with the deposition of these dominantly volcanic sequences was the deposition of the Western VolcanoSedimentary Sequences containing sediments of mixed volcanic or metamorphic provenance and minor felsic and andesitic volcanics.
The extensional tectonism that characterized the eruption and deposition of the MRV was focused on the Henty fault system and the Great Lyell fault. Both Henty (Callaghan, 1998) and Mt Lyell (Nuston and Kamprad, 2001) are major mineralised deposits hosted or controlled by faults like these. These faults were reactivated as reverse faults and produced upright northsouth striking folds. The Owen conglomerate was deposited in the Dundas Trough.
Later intrusion of granitoids led to brittle wrench fault deformation and major tin deposits of various styles and minor base metal and gold vein deposits.
Within the SMRV tenements, the MRV can be divided into two main areas, the D’Aguilar RangeThirkell Hill area and the Elliott Bay area. The SMRV are separated from the main belt of MRV north of the Gordon River and the two main areas are separated by a Tertiary graben (Moores Valley). For personal use only use personal For The geological understanding is hindered by relative lack of drilling and the nature of the surface outcrops, which are generally leached and bleached (MacDonald, 1994 & 1997).
89 PROSPECTUS
Late CambrianOrdovician siliciclastics interpreted as Owen Conglomerate correlates are folded into a gently north plunging syncline with a shallowly dipping eastern limb and a steeply dipping to slightly overturned western limb. This is known as the Mt Osmund syncline. The Owen Conglomerate unconformably overlies the MRV.
Some of the geological sequence described below is outside the boundary of EL 20/96.
The sequence on the eastern limb of the Mt Osmund syncline from east to west is: a Precambrian sequence of multideformed metasediments; a westerly dipping unit of volcaniclastic and siliciclastic sediments correlated with the Sticht Range beds of the northern MRV sequence. This unit overlies the Precambrian partly in faulted contact and partly unconformably; a 2 to 3 kilometre thick quartzfeldsparbiotite porphyry, the Elliott Point Porphyry, occurs to the east; west of the Elliott Point Porphyry is the eastern limb of the Lewis River Volcanics. This has been subdivided into the Hudson River and Wart Hill Pyroclastics. These consist of quartzfeldspar phyric lavas (intrusives?), quartzfeldspar biotite phyric lavas and intrusives and minor intermediate lavas or intrusives; the Waterloo Creek Group unconformably overlies the volcanics. These occur as a unit of felsic derived volcaniclastics, overlain by a unit of black pyritic shale with minor horizons of micaceous siltstone; and the Owen Conglomerate siliciclastics conformably overlie the Waterloo Group.
The sequence on the western limb of the Mt Osmund syncline is as follows: west of the Waterloo Creek Group, the rocks consist of quartzfeldspar phyric volcaniclastics including sediments, quartz feldspar biotite phyric lavas (intrusives?), quartzfeldspar phyric lavas (intrusives?) and sediments ranging from black to grey shales, sandstones, vitreous tuffaceous siltstones and siliciclastic sandstone, conglomerate and breccia. These rocks form part of the Wart Hill Pyroclastics; the Wart Hill Pyroclastics are followed to the west by a unit of interbedded conglomerate and sandstone with minor shale and siltstone. This varies compositionally from predominantly volcaniclastic to predominantly siliciclastic. A unit of shales and siltstones with minor volcaniclastics in turn follows this. These two units are called the Western Epiclastics; the Copper Creek fault is a major fault that extends from south to southwest through the Western Epiclastics. To the west of this fault the Western Epiclastics contain mafic volcanics possibly akin to the Mainwaring River Group to the west; faulted contact with Mainwaring River Group tholeiitic mafic lavas (intrusives) and mafic derived volcaniclastics the western margin of the Western Epiclastics is faulted (Copper Creek fault?) and rocks to the west of this consist predominantly of sedimentary and volcaniclastic rocks of quartz–feldsparphyric and feldspar–phyric composition. There are also units of plagioclasepyroxenephyric lavas, black to grey shales, siltstones and sandstones with an intercalated felsic to intermediate volcaniclastic; and General correlations have been made with the major units of the Elliott Bay area with those in the main part of the MRV to the north. Although specific correlations with the known lithostratigraphy of the northern section of the MRV (north of Macquarie Harbour) are unavailable, there is consensus that the Elliott Bay area does represent the southern continuation of the MRV.
The MRV lie on the eastern limb of a north striking, shallowly north plunging syncline. Ordovician siliciclastics lie in the core of the fold. The western limb of the fold has been down faulted during the formation of a Tertiary graben. The sequence dips at 600 to 700 and faces west.
A sequence of coarse to fine grained sediments with mixed Precambrian and MRV provenance unconformably overlies Precambrian metasediments. To the north this sequence is in faulted contact with Ordovician siliciclastics. The unit fines from east to west and changes compositionally from Precambrian provenance to volcanic provenance. The sequence has been correlated with the Sticht Range Beds further north in the MRV.
A large, elongate body of coarse quartzfeldsparbiotite phyric porphyry occurs to the west of the sediments. It has been interpreted to be a Cambrian intrusive. Similar intrusives occur in the MRV package to the north and south. For personal use only use personal For A package of mixed felsic (quartzfeldspar plus or minus biotite phyric) lavas or intrusives and felsic volcaniclastics occur further west. This unit is the main exploration target for VHMS deposits and possibly gold deposits near the intrusive porphyry contact.
90 Within this unit in the northern part of the area east of Mt Lee, a unit of “siliciclastic brecciaconglomerate with quartzite clasts” cuts across the regional strike. Petrologic examination indicates that the silica may originate as hydrothermal filling along a fault. The volcanics underlying this body are strongly silicasericite plus or minus hematite altered.
A unit of felsic volcaniclastics, conformably overlies this package and is in turn overlain by fine shales/siltstones. These rocks are commonly schistose and sericitic and are correlates of the Waterloo Creek Group.
Siliciclastics interpreted as correlates of the Ordovician Owen Conglomerate to the north overlie the Waterloo Creek Group correlates. The contact may or may not be conformable.
A number of northeast and northwest trending wrench faults have been interpreted from aerial photography.
Various exploration programs in the Elliott Bay and Thirkell Hill areas have identified a number of distinct types of mineralisation (McNeil Associates, 1992).
Base metal sulphide mineralisation as:
VHMS massive sulphide style, e.g. Wart Hill; Vein style galena, sphalerite and arsenopyrite mineralisation along the Copper Creek fault e.g.; and Disseminated leadzincsilver mineralisation in volcaniclastics e.g. Lewis River
Gold mineralisation:
High grade gold in silicified structures; In VHMS deposits, e.g., at Wart Hill; As quartzpyritetourmaline alteration zones related to shears; and As stratabound vein style mineralisation in coarse pyroclastics, e.g., Sassy Creek.
The latter styles of mineralisation are widespread. Lead isotope work has recognised an early Cambrian as well as a Devonian age base metal signature (Gulson, 1987).
Highgrade zincleadsilvergold deposits are the primary Exploration Target that Torque will explore, however there are widespread traces of gold within the project area which provide a secondary Exploration Target (see Section 4.1.1.)
Palaeozoic Australian VHMS deposits occur within the submarine portion of calcalkaline volcanic belts that are composed of a series of complex volcanic centres with related epiclastic facies” (Large et al, 2001). The volcanic hosted massive sulphide (VHMS) deposit style of mineralisation in Tasmania is typified by the deposits already known in the northern section of the MRV. Some examples of these have already been summarised in Table 1. In the northern section of the MRV two types of VHMS deposits are known, viz highgrade polymetallic stratiform massive zincleadcopper sulphides and low grade copper rich disseminated to massive stratabound deposits. The precious metal contents of the MRV deposits are particularly high in comparison with other massive sulphide deposits worldwide.
The most interesting target for gold mineralisation in the SMRV is a deposit similar to the currently operating HentyMt Julia gold mine in the northern MRV. This deposit hosts gold associated with sulphides in an alteration zone adjacent to the Henty fault that is a major syndepositional structure transgressing the MRV. The main controls appear to be the conjunction of a favourable lithostratigraphic, or chronostratigraphic, host unit and a major, semiregional, probably synvolcanic fault. Intersections of major syndepositional faults may be particularly favourable locations.
Stratabound gold mineralisation similar to the volcanic hosted Temora gold deposit in the Silurian volcanics of the Tasman Geosyncline in New South Wales could also occur. Here gold occurs in an alteration system with anomalous base metal (lead) analyses associated with major zones of silicification.
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91 PROSPECTUS
The Elliott Bay area saw some minor historical prospecting probably in the period between 1890 and 1910 and old workings are visible at several places. The alluvial gold at Sassy Creek was apparently overlooked during this early prospecting phase.
In 1957 the L.E.E. joint venture held the first modern EL in Tasmania, the “Gordon Concession” which covered a large area of southwest Tasmania. They undertook an airborne electromagnetic (EM), magnetics and scintillometer survey and undertook inspection and some mapping and sampling of the old workings.
BHP explored the southwest of Tasmania from 1965 to 1975. They also undertook airborne surveys (magnetics and scintillometer) as well as stream sediment geochemical sampling of the MRV and some soil geochemical sampling. They also undertook an airborne EM survey (McPhar H400).
Geopeko (a division of Peko Wallsend) undertook an extensive exploration program in the area between 1976 and 1985 having recognised the potential of this southern extension of the MRV. The work started with collecting stream sediment geochemical samples, geological mapping and follow up of regional EM and aeromagnetic anomalies (Geopeko, 1977, 78, 81, 83 &, 84).
Further work included covering various prospects with systematic gridding, soil geochemical sampling including Chorizon sampling ground magnetics, VLFEM and drilling. A total of 32 holes (3,573m) were drilled on nine prospects (not all within Torque tenements). In 1981, regional geochemical sampling and follow up mapping resulted in the discovery of the Wart Hill prospect where small zones of massive sulphide were discovered with highly anomalous rock chip geochemical sampling results. Trenching and drilling of this prospect was followed by more regional work (IP and Chorizon soil geochemical sampling) in the Mt Osmund syncline.
Geopeko withdrew from the area in 1984 for a number of reasons (Geopeko, 1985). They had concluded that potential to locate an economic highgrade VHMS deposit within 100m of surface was low, exploration projects were being rationalised Australia wide and they were unable to attract a joint venture partner on favourable terms.
V19/1 200.36 128 132 4 0.33 0.17 4.4 NA V19/2 48 49 1 0.79 1.2 10 NA and 160.2 55 56 1 1.37 3.27 28 NA and 60 61 1 0.65 1.15 10 NA V19/3 46 50 4 0.25 0.44 11 0.26 301.2 including 46 47 1 0.53 1 30 0.96 V19/4 70.6 NSI V19/5 150.2 NSI
NA – Not Analysed NSI – No significant Intersections
Cyprus Gold Australia Corporation (Cyprus) acquired the exploration rights in 1985 (Cyprus, 1996) and undertook exploration between 1985 and 1990 targeting VHMS style massive sulphide deposits and gold (Cyprus, 1989). After a complete review of the Geopeko work, Cyprus undertook a helicopter borne DighemEM and magnetic geophysical survey (Mitre Geophysics, 1988) as well as additional Chorizon soil and rock chip geochemical sampling and geological mapping. Anomalous areas were followed up with priority on Sassy Creek, and Wart Hill, plus other areas outside the present EL boundaries (Reid, 2003).
Cyprus drilled 12 diamond core holes (1,962.3m) at Wart Hill. Down the hole EM was completed on the majority of the drill holes.
In 19891990 Cyprus joint ventured the area with Aberfoyle Resources Limited (Aberfoyle, 1991). They undertook an airborne QUESTEM geophysical survey covering a large part of the area. This survey identified nine anomalies that warranted ground follow up. Ground EM and soil geochemical sampling was undertaken over some of the anomalies.
For personal use only use personal For Plutonic Operations Ltd (1996) (Plutonic) successfully tendered for the area in 1994 and carried out work from 19941995. Plutonic reviewed data and geologically mapped core and outcrop at Wart Hill, reviewed various geophysical surveys and undertook a moving loop SIROTEM (Billiton, 2000) and ground magnetic survey at Wart Hill. They undertook a detailed
92 geological reevaluation of Wart Hill attempting to define vectors to mineralisation but decided not to undertake any further drilling at Wart Hill for massive sulphides although drilling targets on geophysical anomalies were recommended. As drilling was a major condition of the tenement grant, Plutonic relinquished the tenement in 1996.
The failure of the drill holes in intersecting massive sulphides at depth in this phase of drilling was explained by the preferred theory that the sulphides had moved from site of deposition by slumping or mass flow of fragments from a primary VHMS deposit. Extensive and detailed geophysical surveys were undertaken at Wart Hill by Geopeko included IP, gravity, magnetics and UTEM as well as a number of trial surveys utilising other methods. Cyprus undertook a more intense drilling program at Wart Hill completing 12 diamond core drill holes (1,962.7m). The results are summarised in Table 11.
WHI 78.50 16.0 17.0 1.0 0.34 0.71 15.0 0.01 WH2 64.00 33.0 34.0 1.0 0.70 4.40 13.0 0.08 Including 43.0 51.0 8.0 1.21 3.11 26.0 0.18 WH3 69.20 NSI WH4 95.10 53.3 54.3 1.0 5.53 11.18 74.0 0.09 and 84.0 85.5 1.5 6.70 12.05 168.0 0.88 WH5 82.5 NSI WH6 68.80 47.0 51.0 4.0 1.15 2.02 30.0 0.35 WH7 120.0 NSI WH8 283.40 108.0 110.0 2.0 0.81 1.15 13.3 0.08 and 184.85 185.95 1.1 10.39 23.55 123.0 0.63 and 231.0 232.0 1.0 0.18 0.49 3.8 1.13 WH9 233.0 NSI WHI0 244.50 185.0 190.0 5.0 2.97 6.04 31.5 1.35 WHI1 264.70 NSI WHI2 10.50 NSI WHI2A 359.0 NSI NA – Not Analysed NSI – No significant Intersections
These intersections are more encouraging than those from the earlier holes and included some narrow intervals, notably in holes WH4, WH8 and WH10 of a similar tenor to the surface samples and to known VHMS deposits in the northern zone of the MRV.
Down the hole EM was completed on the majority of the Cyprus drill holes and possible off hole responses were obtained in holes WH5 and WH7. A second phase of DHEM in 1989, in the holes drilled to test these possible responses, eg. WH10 below WH5, failed to indicate significant responses.
CSIRO lead and sulphur isotope work suggests that the leadzinc massive sulphide lenses in outcrop and core at Wart Hill originated from a Cambrian age sea floor VHMS deposit.
Plutonic undertook a moving loop SIROTEM and ground magnetic survey and confirmatory Chorizon soil geochemical samples. Plutonic relogged the Cyprus drill holes and undertook other work emphasising the interpretation of volcanic facies and alteration zonation to provide vectors to the exhalative centre, conceptually the source of the restricted massive sulphide lenses found at surface and intersected in drilling.
This work was unsuccessful in identifying convincing VHMS footwall alteration vectors but tentatively inferred the source of the massive sulphide clasts may have been up dip and to the north, a direction that was thought to be unfavourable for exploration potential. The Wart Hill prospect was considered to have moderate potential but relatively few drill holes were drilled.
Fimiston (Fimiston 1998 and 9899) drilled two holes as follows:
one SDH1 at Wart Hill, (known as Silver Hill by Fimiston), to test the depth extension of the intersection of hole WH8
drilled by Cyprus; and: For personal use only use personal For another SDH2 to test geophysical (gravity) and geochemical anomalies to the southwest of Wart Hill.
93 PROSPECTUS
The results are summarised in Table 12.
SDH1 352.0 179.0 180.0 1.0 1.22 1.35 16 0.06 SDH2 400.0 NSI
NSI – No significant Intersections NA – Not Analysed
Only 26 assays over selected intervals totalling 25m out of the 752m drilled were undertaken and it is uncertain whether or not the targets were adequately tested by these holes.
As a part of its 20012002 reevaluation of exploration data, TasGold (later changed its name to Frontier) examined existing drill cores and assay data from Wart Hill. The TasGold assessment is similar to Cyprus’s interpretation but does not support the previous Geopeko interpretations, which had suggested that the sulphide lenses at surface and in drill hole intersections are re sedimented clasts derived from an eroded VHMS deposit (Tasgold, 1993 and 2003). It considered the intercepts in six holes (WH1, WH2, WH4, WH6, WH8 and WH10) as representing a single host horizon, which contains semicontinuous sulphide mineralisation over a strike length of at least 250m and down dip extent of 200m. Australian Minerals completed a Turair survey and reconnaissance geochemical sampling in 1973.
Union Oil Development Corporation (Union Oil, 1975) undertook the first systematic modern exploration in the area in 1975. They constructed an access track from Birch Inlet and undertook grid based (31,000m) soil geochemical sampling and IP geophysical surveys over the southern two thirds of the area. They also completed an airborne EM geophysical survey over the southern two thirds of the area and reconnaissance sampling elsewhere (Dighem, 1981). This work identified several lead, zinc, and copper geochemical anomalies within the MRV. These appeared to be semicontinuous over strike lengths of 1 to 5 kilometres. Numerous more isolated IP, EM and geochemical anomalies were also identified.
Geopeko Ltd (Geopeko) undertook further field work in 1977 and subsequently briefly in 1981. Geopeko confirmed the Union Oil soil geochemical anomalies by analysing Chorizon soil auger geochemical samples. They reviewed several of the prospects and undertook extensive geological traversing. In 1981, Geopeko flew a Dighem EM geophysical survey and completed semi detailed ground exploration over two prospects including extensive auger drilling on one prospect in the MRV.
CSR sampled thirteen stream sites for gold in 1985 and collected four pan concentrates. The pan concentrates all showed anomalous gold. However, bulk leach and stream silt analytical results from the thirteen sites were all low.
Macmin (parent of Frontier) in a joint venture with Anglo Australian Resources NL (AAR) undertook an extensive geochemical sampling program in 1993 and 1994 (Anglo, 1993 and 1994). This included pan concentrate sampling, soil and rock chip sampling as well as a Huminex soil sampling program using MRT technology. This work led to diamond drilling and in 1995 six short drill holes (totaling 292.5m) were drilled on the Southern Porphyry Contact grid (south zone), targeted on “the best of the defined gold soil anomalies” to test stratigraphic and structural association (Anglo, 1995). In 1996 further geochemical sampling was undertaken (Anglo, 1996).
After AAR withdrew from the joint venture in 1997 (Anglo, 1997), Macmin undertook further drilling in 1998. Two diamond core drill holes (371m) were completed at the Condor prospect to test a base metal soil geochemical anomaly in MRV. Macmin’s targets were both VHMS style base metal sulphides and gold.
Frontier Resources’ initial fieldwork focused on drilling 11 holes at Sassy Creek where 3.0m at 17.5g/t gold, 12.7g/t silver, 4.5% lead and 4.0% zinc had been intersected in a zone of extensive gold in soils and streams. Sassy Creek has been interpreted previously as a volcanogenic gold deposit. Mineralisation consists of sphalerite plus galena and pyrite veins and disseminations in sericite plus carbonate altered volcanics with the gold apparently occurring at a discrete stratabound horizon within the system. At least some of the holes were drilled away from the target zone due to a (then) newly realized discrepancy between the local grid and GPS determined AMG coordinates (of the order of 4080m). SC006 intersected
2m at 1.4g/t gold in silica plus sericite alteration adjacent to a major fault zone. For personal use only use personal For A single hole was also drilled to the north of Wart Hill to test an aeromagnetics anomaly corresponding with the strike projection of the Wart Hill horizon, intersecting magnetite veined andesite.
94 In 2003/2004 Frontier Resources shifted the focus back to the Wart Hill massive sulphides with a total of 13 drill holes for approximately1875m completed on the Wart Hill and West Wart Prospects. Highgrade massive sulphides were intersected in 6 of the 13 holes drilled at Wart Hill with 7m at 55.6g/t silver, 6.16% zinc, 3.33% lead, 0.22% copper and 1.81g/t gold from 197m intersected in WD009 and 2m at 0.97g/t gold, 47g/t silver, 0.24% copper, 3.64% lead and 7.34% zinc from 193m intersected in WD012. All results are shown in Table 13. Whilst intersecting definite clastic sulphides the drilling program confirmed Cyprus’ interpretation of the presence of a recognisable, extensive and largely continuous exhalative horizon upon which insitu base plus precious metal mineralisation is found. The horizon lies within a thin unit of polymict volcaniclastics between two more voluminous pumiceous mass flows. Sulphide clasts are present in the polymict volcaniclastic. Exhalative activity is supported by massive insitu base metal sulphide, massive pyrite, pyritic chert and carbonate as layers/beds within the polymict volcaniclastics. Structurally the mineralised horizon is interpreted to lie on a steeply east facing overturned western limb of the Osmund Syncline. The facing of the sequence had been a point of some conjecture, however Frontier Resources geologists have seen considerably more of the geology than earlier workers. Continuity of this horizon was shown to a depth of 250m down plunge from the surface. In addition a further 3 drill holes were drilled into the Pleiades (V30) Prospect In 2005/2006 a (38.4 line km) 3DIP survey was conducted over the Wart Hill area eastwards across the Mt Osmund syncline to the Aldebaran prospect (now lying outside the current tenement holding). The survey clearly shows the host horizon to correspond with the contact between higher resistivity to the west east (i.e. hangingwall) and higher chargeabilities to the east (i.e. footwall) with the horizon trending just west of south towards the south. Subsequent drilling focused on testing anomalous IP features along this trend with the exhalative horizon intersected in both holes WD016 and WWD003 which showed that the peak chargeability anomaly at the Silver Trench corresponds to the polymict volcaniclastic unit with sulphide clasts and disseminations to 10% locally. A further 9 drill holes totalling 2900.5m were drilled into the Wart Hill prospect in 2007/2008 with WD018 intersecting from 31.15m to 32.57m depth, 1.42m at 0.32g/t gold, 132g/t silver, 3.46% lead and 9.48% zinc. All hole results are shown in Table 13. This drilling supported the interpretation of a southerly plunge to mineralisation on the exhalative horizon. The drilling also supported the presence of two favourable horizons with the Upper Exhalative Horizon that which had been targeted previously and a Lower Exhalative Horizon lying stratigraphically just above the coherent rhyolite porphyry. Subsequent drilling (WD020022) stepped southwards to explore the horizon at depth but crossfaulting complicated the picture. WD020 intersected a strong chloritecarbonatemagnetite plus or minus minor basemetal zone from the Upper Exhalative Horizon. Further drilling tested UTEM/IP/gravity/soil anomalies south of Wart Hill itself with SWD003 intersecting the Lower Host Horizon defined by a dark grey volcaniclastic siltstone/shale with a silicified top, a recognisable marker for the lower horizon, returning 1m at 2.24% zinc equivalent. Exploration of EL 20/1996 Elliott Bay in the 2010/2011 reporting year focused on the Wart Hill prospect. A SWIR (short wavelength infrared) survey of alteration minerals in existing drill core was conducted to map out patterns in hydrothermal alteration in the Wart Hill/East camp area. This work shows white mica alteration to be domainal with white micas in the rocks to the west of the exhalative horizons at Wart Hill more phengitic than white micas to the east of this horizon and to the south. Drilling initially focused on completing the testing of the host horizon south and west of Wart Hill with previous hole SWD04 extended and a relatively deep hole drilled into Wart Hill itself. Whilst not entirely consistent with the general exploration model for Wart Hill mineralisation, the tantalising coincident conductivity/chargeability/gravity in the Waterloo Creek Group shales was tested by WD024 with shales intersected and the gravity anomaly perhaps due to more siliceous shales(?) Three holes (Figure 24), WD023 (148.5m depth), WD025 (294.8m depth) and WD026 (115.4m depth) were drilled in the area of the Wart Hill massive sulphide lenses in order to define the distribution of mineralisation for a resource estimation. No massive sulphide mineralisation was intersected in WD023 and WD026 though the targeted horizons were intersected,
however, WD025 intersected high grade Au rich base metal massive sulphides on the Upper Exhalative Horizon. For personal use only use personal For
95 PROSPECTUS
Figure 24: Long Section Wart Hill Prospect – SMRV Project
Long section Wart Hill silver zinc lead prospect, SMRV Project. The best hole was WDO25 and mineralisation is open down plunge to the north and south.
The Wart Hill massive sulphide deposit lies on the northern and western flanks of Wart Hill, ~5km inland from the coast on EL 20/1996. At depth and along strike, exploration including drilling, soil geochemistry, 3DIP, VTEM, Short Wavelength Infrared and other exploration methods all support the possible presence of a large massive sulphide body. The deposit has shown the potential for high grades (e.g.. 1.39% copper, 12.8% lead, 27.4% zinc, 75g/t silver and 4.9g/t gold over 0.75m in WD025). Experience in similar mineralised volcanic terranes has shown that such deposits are rarely alone with a common pattern being a large "mother" and a number of small proximal "babies". This understanding comes about in part from study of currently forming examples on the seafloor. Wart Hilltype VHMS deposits form by the exhalation of metal rich hot water out onto the cool seafloor through selfbuilding “black" or "white smokers”, upright chimneys of massive sulphide. This massive sulphide accumulates forming mounds on the seafloor. In some softer, spongier rocks it is common for this fluid to mix with seawater below the seafloor with the dissolved metal precipitating in pods just beneath the seafloor. Modern day examples form in clusters or fields along interplate crustal structural zones such as oceanic trenches. Examples of such clusters in the ancient record are commonly called "camps", particularly in the extensively mined and well understood Canadian examples. Tasmania's MRV belt contains a number of such camps with the Hellyer (Eadie, 1984)/Fossey/ Switchback/Que River (5 lenses)/Mt Charter camp, the Thomas Tunnel/Browns Tunnel/Rosebery (20 plus lenses)/ Hercules (14 lenses) camp and the Henty/Newton Creek/Tyndall Creek to Comstock/Mt Lyell trend. Indeed the Rosebery deposit consists of over 25 lenses stretched over a strike length of 4km and depth of 1.5km (Figure 25).
For personal use only use personal For
96 Figure 25: Long Section (Mirror Image) Rosebery Mine Orebody Mirror image of long section of Rosebery Mine orebody with Wart Hill mineralisation superimposed. Note the zonal or “poddy” nature of the Rosebery silver, zinc, lead mineralisation which is significant in assessing similar mineralisation at Wart Hill. This figure illustrates the untested potential and the extensive, so far untested areas at depth and along strike from the known Wart Hill mineralisation. The orebody at Rosebery is not one continuous or homogeneous body.
With an improved understanding of the geology of these deposits and their enclosing geology has shown these to all have formed over the same short time interval in the earth's history approximately 500 million years ago on the seafloor or immediately beneath it. Recognising the particular layer in the rock which represents the seafloor at the time mineralisation occurred is highly important in locating further ore bodies along this layer. In the rest of the Mt Read Volcanics this layer is known colloquially as the “Holy Host” horizon (coined by exploration geologists associated with the Rosebery and Hercules mines). It corresponds with the Lynchford Member, the basal member of the Tyndall Group and is characterised by the presence, variably, of shale, polymict volcaniclastics, carbonates, basalt including "fire fountain" basalts and the introduction of commonly coarsely quartzphyric volcanics and volcaniclastics. Frontier Resources Ltd’s (and previous) drilling to date has clearly defined the southern extension of this “Holy Host” horizon with quartzphyric volcanics and volcaniclastics associated with polymict volcaniclastics and carbonate. More correctly, the “Holy Host” horizon is not actually a single mineralised horizon but rather a number of horizons within a single package of rocks of thickness in the order of tens of metres. These multiple horizons accord with the results of drilling at Wart Hill where base metal plus or minus gold mineralisation occurs on at least two horizons known as the Main (Upper) Exhalative and Lower Exhalative horizons. Whilst exploration has focused on the Main (Upper) Exhalative Horizon many holes also intersect a Lower Exhalative Horizon which is also mineralised though to a somewhat lower tenor. This lower horizon lies just above the West Wart rhyolite intrusive. The recognition of the presence of the “Holy Host” horizon also has ramifications for the potential of the Wanderer River EL to the north as the same stratigraphic sequence must pass through the entire volcanic belt. Whilst the relationship between overlying Ordovician sediments and the underlying Cambrian Mt Read Volcanics can be unconformable elsewhere on the west coast, in the SMRV project area this relationship appears semiconformable. In such a case the "Holy Host" horizon will lie near to this contact throughout the project area (see Figure 14). The Wart Hill deposit lies on the steeply overturned western (west facing) limb of the Osmund Syncline. A long sectional view of the deposit is shown in Figure 24 with intersections listed in Table 13. The main intersections of insitu massive sulphides are at depth and to the south, i.e. WD025; 157.1m to 171.0m13.9m at 0.31% copper, 4.47% lead, 8.97% zinc, 37g/t silver & 1.11g/t gold including:
157.1m to 157.85m (0.75m down hole = 0.6m horizontal), 0.75m at 0.87% copper, 14.6% lead, 28.6% Zn, 48g/t Ag & 1.04g/t Au
159.85m to 160.6m (0.75m down hole = 0.6m horizontal), 0.75m at 1.37% copper, 12.8% lead, 27.4% zinc, 75g/t silver & 4.9g/t gold, and
163.9m to 171.0m (7.1m down hole = 5.6m horizontal), 7.1m at 0.35% copper, 5.58% lead, 11.18% zinc, 58g/t silver & 1.48g/t gold
For personal use only use personal For WD012; 193m to 195m, 2m at 0.97g/t gold, 47g/t silver, 0.24% copper, 3.64% lead and 7.34% zinc WD009; 197m to 204m, 7m at 1.81g/t gold, 56g/t silver, 0.22% copper, 3.33% lead and 6.16% zinc
97 PROSPECTUS
WD019; 159.7m to 160.08m, 0.38m at 0.43g/t gold, 120g/t silver, 0.05% copper, 2.24% lead and 4.79% zinc WH10; 185m to 190m, 5m at 1.35g/t gold, 31.5g/t silver, 0.25% copper, 2.97% lead and 6.04% zinc These intersections define a coherent pod of massive sulphide mineralisation at least 100m x 100m and open to the south at depth with a southerly plunge to the deposit. Frontier drill holes WD013, WD014 and WD022 have attempted to test this southerly plunge, however, faulting and uncertainty of interpretation suggests all three holes may not have intersected this trend but all stopped short with recommendations for extending WD014 and WD022. Figure 25 superimposing the Wart Hill long section and drilling onto a mirror image of a long section of the Rosebery deposit shows the considerable potential size of the downplunge extensions of the Wart Hill deposit. Rosebery has a more or less continuous “Holy Host” horizon but the ore within the “Holy Host” horizon occurs in a series of separate zones. Holes drilled further south of Wart Hill are still too shallow to test this southerly plunge (Figure 24). However, drilling nearer surface has encountered base metal anomalous alteration over considerable sections of drill holes e.g. SWD002; 79.7m to 178.0m for 98.3m at 0.1% lead and 0.14% zinc. This zone, 1.5km south of the Wart Hill lens, has seen some crossfaulting and remains poorly tested. Similarly favourable alteration in East Camp (prospect) holes EC1 and EC2 has yet to be followed up. Significantly the South Wart and East Camp zones lie midway between the Wart Hill alteration system and a similar system at Sassy Creek further south.
An Inferred Resource which complies with JORC guidelines has been estimated for the mineralisation defined to date.
The resource zone consists of a combination of massive insitu, disseminated footwall alteration style sulphide and sulphide clasts in polymict breccias. Frontier’s previous resource estimation attempted to include only insitu material; however, this is not easily achieved given the ambiguity of some intersections. The close spatial relationship between insitu, clastic and disseminated sulphide in most drill holes suggests that there is a discrete mineralised zone or horizon which can be traced along strike between drill holes.
A typical Wart Hill intersection consists of disseminated and clastic sulphides in a polymict volcaniclastic unit with included and occasionally stratigraphically overlying bands of massive sulphide.
In a number of instances drill holes intersected the expected position of the mineralised horizon with no suggestion of mineralisation nor polymict host horizon. Here mass flows may have removed mineralisation, or acted to bury the hydrothermal system.
The resource estimation used Surpac’s inverse squared methodology (MacDonald, June 2012). A resource was estimated for various gold equivalent cutoff grades ranging from 0g/t gold to 10g/t gold equivalent. Using a cutoff grade of 5g/t gold equivalent gave 167,364t at 1.14g/t gold, 74g/t silver. 0.215% copper, 3.88% lead and 7.7% zinc (gold equivalent grade of 7.12g/t).
The gold equivalent was calculated using the following: gold $1,592/oz; silver $28.39/oz; copper $3.54/lb; lead $0.881/lb and zinc $0.863/lb, leading to a gold equivalent formula of: gold equivalent (g/t) = [0.0178273 x silver (ppm)] + [0.0001524 x copper (ppm)] + [0.000379 x lead (ppm)] + [0.000372 x zinc (ppm)].
The South Wart and East Camp areas to the south of the known Wart Hill Mineralisation appears be highly prospective based on the zinc (Figures 26 and 27) soil geochemistry, Short Wavelength Infrared data, VTEM anomalism and 3DIP data (Large, 1985 & 1987).
According to Aimex Geophysics (May 2012): “The Wart Hill massive sulphide deposit occurs as a subtle chargeability and conductivity anomaly.” Aimex defined five other similar geophysical targets which have not yet been adequately tested.
The soil geochemistry shows strong zinc and lead anomalism to the south of Wart Hill extending through South Warty, East Camp to Sassy Creek/ Pleiades (Figure 26).
The Short Wavelength Infrared spectral (SWIR) data suggests that based on data from the few drill holes in the South Wart area, this area is more prospective than the actual Wart Hill area. SWIR analysis compares the type of micas found near known massive sulphide deposits such as Mt Lyell and Highway Reward (Figure 26).
For personal use only use personal For The VTEM airborne electromagnetics survey defined a low order conductivity anomaly between East Camp and Wart Hill (Figure 27).
98 The above exploration results clearly indicate that the area from Wart Hill to Pleiades warrants drill testing, and is likely to include the “holy host” horizon and may contain massive sulphides within that horizon.
Figure 26: SWIR Samples of Alteration in Drill Core, Wart Hill Figure 27: VTEM Anomalous Zone, Wart Hill South South Shows the simplified geology of the Wart Hill – Sassy Creek Shows the VTEM conductivity slice at 300/400m depth area; the prospective zone to the south of Wart Hill based on the and the conductivity anomaly south of, and apparently SWIR sampling of alteration and on the VTEM conductivity zone. indicating continuity with, the Wart Hill massive sulphide zone.
The second highly prospective zone of VHMSstyle alteration on EL 20/1996 lies 34km south of Wart Hill at Sassy Creek and the adjacent and arguably contiguous Pleiades prospects. Here sericite plus carbonate altered volcanics contains base metal stringers veinlets with visible gold e.g. Sassy Creek 3.0m at 17.5g/t gold in a steeply west dipping sequence of felsic volcanic and volcaniclastics. The Sassy Creek and adjacent Pleiades prospects were initially discovered by the presence of alluvial gold in streams in the area. Subsequent soil sampling defined an extensive zone of gold anomalous soils over a strike length of 1.4km and width 0.4km. Drilling has been somewhat eventful with the early Sassy Creek series holes apparently drilled downdip of the stringer veinlets. Frontier's initial drilling program was thwarted by a plotting error on Geopeko plans showing the local grid to be incorrectly placed with respect to AMG (GPS determined) coordinates. Subsequent holes were better sited and intersected volcanics and volcaniclastics with variable but often strong hydrothermal alteration. Alteration in drill holes consist variably of sericite plus carbonate, silica, sericite plus or minus pyrite and pyrite, base metal stringers, gold anomalous in part, e.g: Hole V24/3; (125m to 128m) 3.0m at 17.5g/t gold, 13g/t silver, 4.45% lead and 3.95% zinc Hole V24/2; (202m to 203m) 1.0m at 2.7g/t gold Hole SC006; (37m to 39m) 1.0m at 1.36g/t gold, 0.86% lead and 2.72% zinc Hole SC009; (30m to 31m) 1.0m at 1.6g/t gold Hole SC010; (43m to 44m) 1.0m at 1.03g/t gold Hole SC011; (65m to 66m) 1.0m at 1.02g/t gold For personal use only use personal For Hole SC014; (33m to 34m) 1.0m at 3.8g/t gold, 0.55% lead and 2.43% zinc There are a number of examples in the Mt Read Volcanics of similar alteration and mineralisation styles.
99 PROSPECTUS
The Henty gold deposit mineralisation occurs in intensely silicified volcanics in the immediate footwall to massive pyrite lenses. South Hercules gold, zinc, lead, copper and silver. Footwall stringer system to the Que River massive sulphide deposits. Pinnacles area (Browns and Thomas Tunnels and Southern Trenches) with gold in cherty silica plus sericte and pyrite, plus or minus chlorite and ankerite altered volcanics associated with small massive sulphide lenses. The potential for a standalone volcanic hosted gold deposit in this stratigraphic setting would be consistent with the above examples. All examples have gold mineralisation hosted within footwall hydrothermal alteration systems analogous to Sassy Creek. However, the gold anomalous alteration may well represent the footwall alteration zone beneath a massive sulphide lens. In such a case the target horizon is the unit of fine grained sediments which stratigraphically overlie the alteration zone. The relationship between the sequence at Wart Hill and that at Sassy Creek is uncertain with the sequence folded and faulted away from Wart Hill. One difference is that the sequence at Wart Hill faces east whilst that at Sassy Creek faces west, however, it is still a geologically arguable interpretation that the siltstone/shale lying west stratigraphically overlying the gold anomalous sequence of altered volcanics is at the same stratigraphic position as the Wart Hill host horizon (and thus by extension the "Holy Host"). Whilst the gold anomalous footwall alteration has been tested by a number of holes, no drilling has tested this horizon for insitu massive sulphide deposits. Geopeko Trench 0 0.2 0.2 0 34 0 2.2 1.5 Geopeko Trench 0 0.3 0.3 0.33 64 0 9.8 4.1 Geopeko Trench 0 5 5 0 35 0 5.9 2 Geopeko Trench 0 4 4 0.6 132 0.16 10.2 17.9 (Lens A) Geopeko Trench 0 3 3 0.8 680 0.2 13.9 21.9 (Lens B) Geopeko Trench 0 1 1 0.97 206 0 39.5 6.6 Geopeko Trench 0 1 1 3.71 115 0 9 4.8 Geopeko V19/2 48 49 1 0 10 0.05 0.79 1.2 Geopeko V19/2 55 56 1 0 28 0.06 1.37 3.27 Geopeko V19/2 60 61 1 0 10 0.05 0.65 1.15 Geopeko V19/3 46 47 1 0.96 30 0.1 0.53 1 Cyprus WH2 32 36 4 0.09 19 0.12 0.71 2.38 Cyprus WH2 43 51 8 0.18 26 0.07 1.21 3.11 Cyprus WH4 46.4 47.4 1 0.09 48 0.04 1.19 2.54 Cyprus WH4 53.3 54.3 1 0.09 74 0.08 5.53 11.18 Cyprus WH4 84 85 1 0.88 168 0.05 6.7 12.05 Cyprus WH6 47 51 4 0.35 30 0.1 1.15 2.02 Cyprus WH6 60 61 1 0.52 77 0.04 0.62 1.06 Cyprus WH8 108 109 1 0.12 28 0.04 0.52 1.6 Cyprus WH8 184.9 186 1.1 0.63 123 0.27 10.4 24.7 Cyprus WH10 169 172 3 0.42 18 0.02 0.57 1.13 Cyprus WH10 185 190 5 1.35 31.5 0.26 2.97 6.04 Fimiston SDH1 179 180 1 0.06 16 0 1.22 1.35 Frontier WD001 42 43 1 0.03 13 0.02 1.61 1.99 Frontier WD001 46 47 1 0.5 65 0.05 2.57 4.39 Frontier WD001 50 52 2 0.2 47 0.03 0.8 1.7
For personal use only use personal For Frontier WD001 55 62 7 0.43 77 0.06 4.48 7.43 Frontier WD002 58.1 71.5 13.4 0.34 55 0.07 2.66 4.91
100 Frontier WD003 80 81 1 0.06 8 0.02 0.47 1.09 Frontier WD004 84 85 1 0.2 82 0.09 0.79 1.63 Frontier WD005 76 78.2 2.2 0.23 52 0.04 0.6 1.25 Frontier WD006 73 81 8 0.1 16 0.02 0.8 1.42 Frontier WD007 137 138 1 0.1 15 0.02 0.51 1.04 Frontier WD007 140.8 144.3 3.5 0.19 49 0.02 1.93 3.04 Frontier WD009 152 153 1 0.05 27 0.01 1.79 3 Frontier WD009 197 204 7 1.81 56 0.22 3.33 6.16 Frontier WD010 22.6 25 2.4 0.4 162 0.12 5.11 9.81 Frontier WD011 17 18 1 0.09 28 0.16 1.42 2.75 Frontier WD011 24.5 25 0.5 0.31 158 0.18 3.87 6.21 Frontier WD012 156 157 1 0.04 11 0.03 0.92 1.88 Frontier WD012 181 182 1 0.05 7 0.04 0.56 1.77 Frontier WD012 193 195 2 0.97 47 0.24 3.64 7.34 Frontier WD013 218 219 1 0 6 0.02 0.41 1.28 Frontier WD017 74.9 205.5 130.64 0.002 1.8 0 0.03 0.07 Frontier WD017 99.66 100 0.36 0.02 12 0.14 0.72 0.22 Frontier WD017 106.5 108.9 2.4 0.004 1.8 0 0.1 0.15 Frontier WD017 145.2 152.3 7.1 0.002 4.7 0.01 0.19 0.36 Frontier WD017 151.9 152.3 0.4 0.04 12 0.01 0.96 1.67 Frontier WD017 163.7 168.8 5.19 0.038 17 0.02 0.18 0.43 Frontier WD017 163.7 164.5 0.85 0.08 30 0.04 0.41 1.11 Frontier WD018 30.43 33.4 2.97 0.18 72 0.06 1.82 4.93 Frontier WD018 31.15 32.57 1.42 0.32 132 0.04 3.46 9.48 Frontier WD018 65 65.8 0.8 0.06 8 0.01 0.51 0.58 Frontier WD019 56.7 57 0.3 1.92 41 0 2.06 2.29 Frontier WD019 149.5 156.6 7.1 0.015 5.5 0.01 0.2 0.31 Frontier WD019 159.7 160.1 0.38 0.43 120 0.05 2.24 4.79 Frontier WD021 317.9 318.3 0.4 0.04 10 0.02 0.35 0.7 Frontier WD021 321.1 321.9 0.8 0.03 10 0.01 0.11 0.15 Frontier WD021 482.6 483 0.4 0.05 9 0.03 1.41 0.91 Frontier WD025 157.1 157.9 0.75 1.04 48 0.87 14.6 28.6 Frontier WD025 159.9 160.6 0.75 4.9 75 1.39 12.8 27.4 Frontier WD025 163.9 171 7.1 1.48 58 0.35 5.58 11.18 Frontier SWD002 79.7 178 98.3 0.005 1.5 0 0.1 0.14 Frontier SWD002 134 140 6 0.02 2.7 0.02 0.29 0.5 Frontier SWD002 166 176 10 0.017 3.5 0 0.27 0.22 Frontier SWD002 175 176 1 0.08 8 0.02 0.64 0.46 Frontier SWD003 65.4 66.4 1 0.01 4 0.02 0.66 1.35 Frontier SWD003 126 130 4 0.005 2 0.02 0.13 0.33 Frontier SWD003 128 129 1 0.01 2 0.01 0.19 0.83 Frontier SWD003 186 187 1 0.001 2 0.02 0.07 0.53 Frontier SWD004 197 227 30 0.001 1.3 0.02 0.05 0.13
Frontier SWD004 202 207 5 0 4 0.05 0.13 0.49 For personal use only use personal For Frontier SWD004 205 206 1 0 11 0.13 0.34 1.52
101 PROSPECTUS
The "Wanderer River" licence encompasses three areas of outcropping Mt Read Volcanics, with areas to the northwest and northeast of Wart Hill within the Elliott Bay window, as well as the Thirkell Hill belt, separated from the Wart Hill window by a Tertiary graben. As discussed previously the presence of the "holy host" horizon at Wart Hill suggests its presence throughout the volcanic belt. As shown in Figure 14 the horizon is likely to be near to the contact with the Ordovician rocks. The prospective rocks in EL 33/2010 have seen relatively little exploration including essentially no historic prospecting activity due to relative inaccessibility and cover. That work which has been done has defined a number of prospects (tabulated in Table 14). Most of these prospects have been defined by a combination of early generation geophysics, including airborne EM, and stream or limited soil sampling. As noted previously there has been negligible drilling. This fact, coupled with the fact that the volcanic rocks outcrop poorly lying for the most part beneath a peat layer in low lying scrub covered ground means that the geology is not well understood. The presence of VHMSstyle hydrothermal alteration at NE Osmund (V20) and the Wanderer River prospects (V22, V34 and V35) in the Elliott Bay window and at Hales River East (Viking 15), Condor River (Viking 10) and D'Aguillar South in the Thirkell Hill belt shows that VHMS forming hydrothermal fluids were present in the volcanics at these prospects. Hydrothermal alteration at D'Aguilar South at the northern end of the Thirkell Hill belt is intriguing. Here an elongate zone of intensely silicified rock surrounded by strong sericite and silica, plus or minus hematite and carbonate alteration and over printed in part by intense chlorite and pyrite alteration outcrops in an area of anomalous gold in streams and soils near to the Ordovician contact. This target remains completely undrilled. Ground followup of an airborne EM anomaly at Viking 15 near Hales River East in an area of poor outcrop revealed sericite and silica altered volcanics in soil auger holes. No holes have been drilled here. More detailed ground followup of other prospects with more detailed mapping will likely reveal similar associations between geophysical anomalies and hydrothermal alteration.
For personal use only use personal For
102
3km x 1km cohesive, coincident anomalous stream sediments and soils with associated I.P and airborne EM Condor River anomalies. (Geopeko's Viking 10 prospect) 3.5km x 0.3km zone of anomalous lead and zinc in soils with three associated airborne EM and I.P. Condor River West geophysical anomalies.
Condor River East 1 km long zone of anomalous lead in soils associated with an airborne EM anomaly. 2 km long zone of anomalous lead in stream sediments, anomalous lead and zinc in soils and two associated Hales River West airborne EM anomalies. (Geopeko's Viking 23 prospect) Hales River East 3.5 km long zone of anomalous stream sediments and soils. (Geopeko's Viking 23 prospect) Viking 14 Two E.M. anomalies and coincident? Airborne Dighem E.M anomalies. Hales River North Lead and zinc anomalous soils. Hales River NW Lead anomalous soils. Viking 15 Airborne E.M. anomaly in pyritic lithiccrystal tuff. Sprent River West 1 km long zone of anomalous soils and stream sediments and associated Dighem airborne EM anomaly. Sprent River East 1.5 km long subtle soil anomaly. Sprent River South 2 km long subtle soil anomaly. Anomalous streamsediments, zinc in outcrop rockchip, Turair airborne E.M. anomaly and 2 other possible D' Aguilar North EM conductors (Geopeko's Viking 195 zone) D'Aguilar South 1.5 km2 area of extensive drainage anomalism. Zone with two airborne EM anomalies, geology (i.e. faulting and haematite alteration) similar to 'The Blow Mt Lee Mt. Lyell'. (Geopeko's Viking 12 zone) 1 km long zone of anomalous soils with airborne E.M., VLFEM and Dighem anomalies, panconcentrate Thirkell North gold anomaly, I.P. anomalies and subtly anomalous stream geochemistry. Thirkell Hill South 2 km long strong airborne EM anomaly, Dighem airborne EM anomaly and subtle stream geochemistry. D'Aguilar East Several airborne EM anomalies. Line 184N IP Two weak IP responses flanking a magnetic feature. Two Questem EM conductors, anomalous lead, zinc and silver in soils, radiometric high and hydrothermal NE Osmund (V20) alteration Wanderer River (V34, V35) Altered volcanics and stream sediment anomalies Wanderer South (V21, V22) Altered volcanics and DIGHEM EM anomaly
Frontier’s exploration licence, EL 27/2011, covering an area of 100km² over the Mt Paris area is located between the towns of Branxholm, Ringarooma and Weldborough, in northeast Tasmania. Frontier is targeting Devonian granitoidrelated tin, tungsten, tantalum and gold deposits, in a range of greisen, disseminated, and vein deposit styles hosted in granites and/or Mathinna Beds. Alluvial deposits are not a major focus. Within the Mt Paris EL there are about 55 minor tin deposits and old workings, mainly distributed along the northwest trending ridge from Rattler Hill to Mt Paris (Figure 28).
Figure 28: Mt Paris Tin Project
Shows EL 27/2011, Mt Paris Tin Project; known tin For personal use only use personal For and gold prospects and geology.
103 PROSPECTUS
The country is mountainous, with a local relief of about 700 metres between the Ringarooma River valley along the western and northern boundaries of the EL and the crest of Rattler Hill rising to 900 metres above sea level near the southeast corner. Most of it is forested, apart from a number of clearfelled coupes in the southwestern half, and an area of subalpine vegetation above about 750 metres elevation at Rattler Hill. Accordingly, the greater part of the EL area is multipleuse State Forest with some private farm and forest properties along the southwestern boundary. The Mt Paris Road, connecting Branxholm and Weldborough, bisects the area and there is a fairly close network of forest roads and tracks for vehicular access, particularly in the southwestern half where most of the known mineral deposits are located.
Hermann (2011) described the geologic setting as follows:
“The Palaezoic basement of NE Tasmania is dominated by an Ordovician to Early Devonian quartzwacke turbidite sequence, known as the Mathinna Beds, which was deformed during the Tabberabberan Orogeny and subsequently intruded by large Upper Devonian granitoid complexes. The granitoids were emplaced at high crustal levels, mainly by upward displacement or crustal rifting, and they produced only narrow contact metamorphic aureoles, a maximum of a few hundred metres wide.
EL 27/2011 is centred on and covers most of the exposed portion of the roughly circular, ~10km diameter, Mt Paris pluton, located at the western edge of the Blue Tier Batholith. The Blue Tier Batholith is the largest (40km x 70km) of four major batholiths in Northeast Tasmania. It is dominated by Itype hornblende+biotite granodiorite and biotite adamellitegranite, with smaller plutons and sheetlike bodies of stanniferous Stype alkalifeldspar granite at Mouth Paris, Lottah, Little Mt Horror and Mt Cameron.
The alkalifeldspar granites associated with tin mineralisation are the youngest granitoid intrusive phases, dated at ~375380 Ma by UPb isotopic ratios in zircon (McClenaghan, 2006). They are highly crystalfractionated Stype granites existing in the upper levels of the Blue Tier Batholith, and occupy about 10% of its area. They are typically pale pink to cream coloured, equigranular to Kfeldsparporphyritic textured granites, composed of quartz, Kfeldspar, albite and Ferich biotite, with accessory apatite, zircon and monazite, secondary muscovite, and rare topaz, fluorite, cassiterite and tourmaline.”
Mineral Resources Tasmania’s mineral deposit database lists 55 minor tin deposits and old workings distributed along the northwest trending ridge from Rattler Hill to Mt Paris and down to the Ringarooma River a little south of Branxholm. About 20 of them are small alluvial placer deposits (Mineral Resources Tasmania, 2000).
Purvis (1988, 1999 and 2000) classified the Mt Paris hard rock deposits into three types:
1. Quartzgreisen veins containing coarse cassiterite with minor chalcopyrite, sphalerite, pyrite, arsenopyrite, and traces of silver, tungsten and uranium. 2. Steeplydipping stanniferous greisen lodes surrounded by zones of kaolinitealtered granite. The argillicaltered facies containing tin were extensively sluiced by early miners. The generally less than 2m wide semivertical greisen lodes contain erratic higher grades but did not produce much tin because they required crushing. 3. Flat lying greisen sheets apparently restricted to the vicinities of the Rattler Hill and Mount Paris prospects.
These deposit types are all associated with the undulating granite roof zone, located at or close to the contact with overlying Mathinna Beds, with occasional thin veins extending into the contact metamorphosed sedimentary rocks. The mineralised and greisenised zones exist in the granite within a few tens of metres of the upper contact and diminish with depth.
Tin production in NE Tasmania is summarised below:
(tonnes of tin metal) 3,260 a) Anchor deposit 2,500 b) Others 600 160 1,000 1,000 340 340 18,670 a) Aberfoyle/Storeys Creek Deposits 17,800 b) Others 870 500 500 46,500 a) Ringarooma River system 44,500 For personal use only use personal For b) St Helens area 2,000 (Various sources)
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For historical reasons the Mt Paris tinfield has not seen the degree of modern exploration that has been conducted at the neighboring Blue Tier tinfield, nor the other two major tinfields at Storeys Creek or Royal George.
Purvis in a 1988 review of the North East Tasmanian Tin Province (Purvis, 1988) concluded that “the stanniferous alkaligranite intrusion known as the Mt Paris Mass has excellent grassroots tin potential. Although the numerous workings on the mass have produced little tin, eroded mineralisation has contributed over 27,000t tin to the alluvial deposits in the Ringarooma system, making the Mt Paris Mass the most productive tinfield in NE Tasmania. This fact has apparently not been appreciated by explorers to date – the area is underexplored. The mineralised roof zone of the granite is only partially exposed and eroded, with the southern half of the intrusion still covered by Palaeozoic sediments. The inference from the massive amounts of tin shed from the eroded northern portion is that extensive tin mineralisation should be present beneath this cover.”
Hermann in 2011 noted: “Cassiteritebearing greisens in the roof zone of the Mt Paris granite pluton were the primary source of alluvial tin deposits in the Ringarooma River Valley, which accounted for nearly twothirds of northeastern Tasmania’s total recorded tin production (~70,000t). There was minor historical production from eluvial deposits on weathered greisen zones, but only negligible production from mining of the numerous ‘hardrock’ greisen lodes that exist in an apparently structurally controlled westnorthwest corridor extending across the exposed pluton.
The wall rocks around its northern, western and southern perimeter are contact metamorphosed sandstonedominant turbidites of the Mathinna Beds. The metamorphic aureole generally appears to be less than about one kilometre wide at surface. However, about a quarter of the pluton, particularly over the southwestern half, is covered by metamorphosed Mathinna Beds in extensive roof pendants. This indicates that although the tinbearing granitoids have been exposed to erosion since late Palaeozoic time and have shed considerable cassiterite into alluvial deposits in northeastern Tasmania (Askins, 1979), the present level of erosion has not entirely unroofed the Mt Paris alkali granite pluton.”
Purvis (1988), noted: “the present topography at Rattler Hill at the southeastern corner of the pluton largely reflects the original form of the granite suggesting relatively recent exhumation of a high level apophysis”. Likewise Nye (1933a) considered the remnants of metasedimentary cover rocks at Mt Paris to be ‘of great economic importance’ because it meant that ‘practically the whole of the [tin] deposits in the cupola are intact and a small proportion only have been removed by denudation”.
Hermann (2011) concluded: “the most empirically probable undiscovered tin resource at Mt Paris is likely to exist in greisen: either in an apical granite cupola covered by metasedimentary rocks, or in ‘Anchortype’ greisen sheets within the granite”.
Prospectors discovered most of the major northeastern Tasmanian alluvial tin deposits during the early to mid1870s and by the early 1880s as they were exploring the primary deposits of the Mt Paris area. Numerous reports by Department of Mines’ geologists and engineers between the mid1920s and mid1960s describe some of the many small mines and prospects on the Mt Paris tin field. The deposits had mainly been worked by sluicing of shallow eluvial material on weathered or argillicaltered mineralised greisen.
In the early 1960s, the Tasmania Department Mines drilled three shallow, inclined diamond drill holes to test greisens over a strike length of 170 metres. All the holes intersected porphyritic granite with narrow zones of greisenised granite containing between 0.1 and 0.8% tin.
Between 1968 and 1974 Texins Development Pty Ltd carried out a district scale review mainly focused on tin potential, an airborne radiometric survey intended to map granite types and explore for uranium, and a stream of geochemical survey for base metal deposits.
Texins drilled 4 diamond core holes but the grades rarely exceeded 0.1% tin, with minor copper and zinc.
In 1972 Groves, on behalf of the Ringarooma Company noted that: “Bells Hill appeared to be the greatest concentration of greisen lodes in the area but the results of preliminary sampling were ‘not encouraging’ for bulk mineable lowgrade tin deposits because of erratic tin grades in the greisen lodes and barren granite between the lodes. The most promising result from sampling of costeans was 140 feet at 0.25% tin (which included the Main Lode), but an adjacent costean had 109 feet at only 0.12% tin.
The Main (greisen) Lode at Bells Hill averages 0.57% tin over the 600 feet of strike length that was sampled.”
In 1977/78 Mineral Holdings and Newmont carried out further exploration. Newmont’s exploration (entirely tingreisencentric) rationale was based on observations that the numerous known, but typically less than 2 metres wide, endogranitic greisen lodes
For personal use only use personal For frequently strike NW, subparallel to the overall trend of the mineral field and the southern margin of the pluton. This suggested that faults influencing intrusion of the granite may have remained active during its crystallization, forming a system of fractures that acted as channel ways of latestage pneumatolytic fluids. Furthermore, the absence of mineralised veins in the apparently
105 PROSPECTUS
impervious overlying Mathinna Beds inferred that there had been accumulation of fluids in domes and cupolas near the granite roof, and thus potential for laterally extensive cassiteritemineralised greisen zones in favourable flat or domed structural settings (Clarke, 1978).
The prime targets were considered to be the Rattler Hill area, which is the topographically highest point on the pluton, and the Mt Paris prospect, located on a small altered granite cupola surrounded by metasediments.
Newmont carried out semisystematic rock chip geochemical sampling of outcrops and old workings aimed at sampling the top two metres of the granite near the metasedimentary rock contact and over areas of exposed greisens. Some grid based shallow drilling was also completed.
Newmont were discouraged by their drilling results that had indicated steeper than anticipated dips on the granite contacts, extensive zones of greater than 20m thick metasedimentary cover, and very low tin grades in the underlying granite.
In 1980 Union Corporation considered three types of cassiterite deposit might make economic grade:
Fracture controlled quartz and quartz + muscovite greisen veins. ‘Cupola’ greisens in subhorizontal roof zones of the pluton; e.g. Mt Paris and Star of Peace prospects, possibly under areas covered by Mathinna Beds. Greisen veins and kaolinitealtered granite host rock that would ‘bulk together’ in a low grade large tonnage deposit amenable to open pit mining.
They carried out further mapping and sampling and some drilling but withdrew in 1982.
In August 1983, Amax Australia Ltd cut two bulldozer costeans across the mineralised zone at Rattler Hill. Both costeans about 150 metres apart along strike, exposed 5 or 6 WNWtrending semivertical to steeply northdipping greisen lenses, in zones about 33 to 53 metres wide.
Cassiterite was observed as disseminated grains up to 5mm size, in drusy quartz greisen veins in the greisen lenses and in the intergreisen granite, with local traces of pyrite, arsenopyrite and malachite. In the eastern costean (RHC1) a 54m wide zone containing 6 greisen lenses averaged 0.15% tin. Background values in the (weathered) granite host rock are less than a few hundred ppm tin, with sparse mineralised quartz greisen veins. A 33m wide zone containing 5 greisen lenses exposed in the western costean RHC2 (excavated above Texins’ drillhole DDH1) averaged 0.17% tin.
In late 1985, following the collapse of the International Tin Council, tin prices crashed and remained below $10,000 per tonne for a couple of decades. Interest in exploration for Tasmanian tin deposits virtually evaporated, for both hard rock and alluvial deposit types.
The sustained improvement in tin value from about 2006 initiated a revival of interest in Tasmanian tin exploration. Late in 2007, Green River Resources Limited was granted EL 41/2007, which occupied exactly the same area as Frontier Resources’ current EL 27/2011 application.
Green River concluded the Mt Paris area ‘has a good potential of hosting a resource of tin in the form of tincarrying greisens’, and foretold further sampling and mapping to lead up to RC percussion drilling in 2010. Blaming the Australian Government’s proposed mining super tax, and the low tin price, Green River decided it would not proceed with exploration in Australia, but would instead surrender the tenement – and wind up the company.
Hermann, 2011 concluded: “the exploration efforts (to date) have been fairly superficial, largely based on surface sampling, pitting, costeaning or, at best, shallow drilling of exposed greisen lodes at the known historical prospects. The Mines Department’s three holes at Guiding Star reached barely 50m below surface, and Texins’ four holes at Bald Hill, and Union’s four holes at Mount Terror, likewise to only about 85m below surface. However, none of those drilling programs provided encouragement to go deeper, and there are many reported observations that the greisen zones are limited to vertical thicknesses of about 30 or 40 metres.
Newmont and Union Corporation (consecutively) took subsurface exploration one step further by drilling for greisen cupolas hidden below the metasedimentary Mathinna Beds cove; their targets guided by not much more distance away from the granite contact at surface, and topography. But again, their exploratory percussion drill programs, constrained by the quest for open cutmineable resources, were shallow; Newmont’s to only 44m and Union’s at Hilltop prospect to a maximum of about 125m.
For personal use only use personal For Not only superficial, those exploration programs were individually brief.
106 Despite the lack of success to date, the most empirically probably undiscovered tin resource at Mt Paris is likely to exist in greisen: either in an apical granite cupola covered by metasedimentary rocks, or in ‘Anchortype’ greisen sheets within the granite. Exploration for nonexposed tin greisen deposits is difficult, because they are not likely to be detectable by conventional surface geochemical and geophysical methods.”
Torque believes the tin in greisens potential at Mt Paris will largely be at shallow depth beneath a thin veneer of overlying sediments. In these circumstances the tin greisens will not yet have been eroded or partly eroded as in the remainder of the Mt Paris area.
These projects include the Interview River and Pieman tenements (Figure 29).
Figure 29: Lower Pieman Project Shows EL’s 6/2011 and 21/2011 geology of and prospects within the Pieman Project. The Lower Pieman Project consists of EL’s 6/2011 and 21/2011. These areas have received relatively little prospecting, in comparison to other areas on the west coast of Tasmania. The main known mineralisation is tungsten at Interview River apparently related to the Interview River Granite. However, copper and silver occurrences are noted in the eastern part of EL 6/2011 although there is little available data on the nature of the copper occurrences. Other tungsten occurrences occur over a several kilometer zone to the north of Interview River.
The tungsten deposits at Interview River have been of interest to prospectors for over 100 years. Intermittent prospecting has been done, mostly by hand, on a small scale until an intensive phase of exploration in the early 1980s resulted in a series of backhoe trenches being dug at 40m intervals over the entire deposit area.
The Interview River tungsten deposits are located 1214km north of Pieman Heads, between Chimney Creek in the north and Interview River to the south, and are about 3km inland from the coastline.
Access has always been difficult, there being no formed roads in the vicinity of the deposits. A rough vehicular track was put in from the Pieman River end in the 1950s. This route is now largely overgrown. During the 1980s phase of exploration machines and vehicles were taken along the northern route, using in part the long sandy beaches as “roads”.
The deposits of “wolfman ore” (i.e. tungsten) are contained in a belt of granite country which runs along the coast for about 16km north of the Pieman River. Small pockets of alluvial tin were worked at the turn of the century, by sluicing in the creeks which “traverse the granite belt”.
The tungsten is found in veins of quartz which “stand out boldly above the surface of the granite”. Minerals associated with these veins include wolframite, scheelite (ores of tungsten), tourmaline, pyrite, arsenopyrite, pyrite, mica and small amounts of feldspar.
The wolframite occurs either as isolated blades from a few mm to 100mm long, or as rich aggregates or “bunches” distributed sporadically throughout the veins. Scheelite is generally associated with wolframite aggregates, but is found forming aggregates of its own in quartz.
The economic minerals which the prospectors were seeking were wolframite [(Fe,Mn)WO4] and scheelite [CaWO4] both of which contain the metal tungsten (W).
For personal use only use personal For The granite in which the tungsten lodes are found has been described as “equigranular, fine to medium grained biotite/adamellite of the Devonian Pieman Granite”. The veins in which the tungsten minerals occur are from 100mm to one metre wide, and are
107 PROSPECTUS
discontinuous. The series of quartz veins are fracture fillings, and extend over 2km, trending 350ºM. Waller described the occurrence of the minerals as “bunchy”; spot samples of pieces of vein are of little use in determining the overall economic grade of the deposit.
An initial lease was granted at Interview River in July 1891. Minor exploration, trenching and shaft sinking were carried out sporadically by various parties for the next 60 years. No production is recorded.
In 1953 a syndicate constructed tracked vehicle track to site for the Pieman Heads, including several bridges over the Rocky Fork and Interview Rivers. Modern company exploration commenced in 1971 with ACI Ltd, Renison Ltd, Mt Lyell and Consolidated Goldfields conducting sampling and an aeromagnetic survey. Later work by a further syndicate completed a number of bulldozer trenches.
In 1981 the exploration licence was acquired by Abignamo Construction; a road to site was surveyed but never constructed; a series of backhoe trenches were cut, old trenches retrenched and an existing adit extended. The tungsten mineralisation was estimated to extend over a distance of 2.5km with grades of approximately 1.4% of WO3. The tungsten occurs in veins varying in width from 100 to 400mm and contain quartzpyritewolframite, tourmaline, muscovite and aresenopyrite with minor cassiterite.
Torque’s development/exploration strategy will initially focus on gold with lesser emphasis on base metals, tin and tungsten. Torque will focus on bringing to gold production the Indicated Resources at Stormont and Narrawa Prospects to provide a cash flow within 6 months of the IPO. This will be initially by way of an association with BCD Resources NL (“BCD”) but in the longer term Torque may develop its own processing facility at Moina.
Torque will acquire from Frontier three diamond core rigs and ancillary excavators, crawlers, trucks etc., (including a “truly man portable” rig which is easily moved into difficult areas and has minimum environmental impact). Most nondrill type exploration has been completed on these projects and the great majority of funds raised will go directly to drilling. Torque plans a continuous and ongoing drill program both to add to the resource base and to locate further mineralised systems. At Moina, Torque in association with BCD, will immediately focus on completion of a Feasibility Study and application for Mining Lease over the Stormont Indicated Resources. Torque, in its own right, or in partnership with an existing gold processor, will complete a feasibility study on the Narrawa Indicated Resources; complete a detailed review of the geophysical and geochemical data to further define priorities in respect to drill targets; drill test for similar systems to the Stormont and Narrawa systems, as defined in the conductivity in the conductivity data; drill the larger chargeability anomalies to test for large, disseminated gold systems such as Fort Knox and Pogo; move to gold production as soon as it is practical.
At the SMRV Project Torque plans to continue and complete a review of all previous exploration prior to determining drill targets in year two of the program. This will include geochemical, geophysical and geological data for both the Wanderer River and Elliott Bay tenements. Torque will also explore the possibility of bringing in a FarmIn partner in Year two of the program.
In year one exploration is expected to include geological mapping to further explore possible “vectors” to mineralisation and 3DIP in selected areas of both the Wanderer River and Elliott Bay tenements.
In year two, drill testing is proposed on targets confirmed in year one, and although at this stage it is expected that, among other targets, the down pitch zone at Wart Hill and the conductivity and geochemical anomalies immediately south of Wart Hill will be targeted.
The Mt Paris area is considered to be a major source area for much of the alluvial tin produced from Northeast Tasmania. Torque’s exploration program in year one will focus on determining whether major, primary tin mineralisation within granitic rocks is a viable target. In particular, Torque will focus on the part of the Mt Paris area that is partly obscured by Mathinna sediments, to determine if significant primary tin remains “in place” beneath these sediments.
Exploration in year one will focus on determining if geochemical sampling can “see through” the overlying sediments, plus geological mapping, and if results are considered positive drill testing will be scheduled for year two.
For personal use only use personal For
108 The Lower Pieman Projects, at this stage in Torque’s development, are low priority, but still considered to have excellent potential to host major tungsten and possibly gold systems.
Year one exploration program will be focused on reviewing all available data, geological mapping and some surface sampling. Subject to the results of the Year one program it is expected that defined mineralised systems will be drill tested in Year two.
Feasibility Studies 40,000 40,000 100,000 200,000 Data Review 30,000 30,000 30,000 Drilling – replicas of Stormont / Narrawa & Extensions of resources 400,000 300,000 300,000 300,000 300,000 300,000 Drilling – large 113,000 disseminated gold / tin 213,000 130,000 130,000 280,000 280,000 systems Tenement Environmental/ Management 10,000 10,000 10,000 10,000 10,000 10,000 Capital 250,000 250,000
Data Review 20,000 50,000 50,000 3DIP Survey 200,000 250,000 300,000 Drilling 200,000 300,000 480,000 Tenement Environmental/ Management 10,000 10,000 10,000 10,000 10,000 10,000
Capital 50,000 50,000 50,000 50,000
Geochemical sampling & geological mapping 200,000 200,000 Drilling 200,000 200,000 Tenement Environmental/ Management 5,000 5,000 5,000 5,000
Review of data 30,000 30,000 Geological mapping 20,000 20,000 Geochemical supply 10,000 10,000 Tenement Environmental/ Management 5,000 5,000 5,000 5,000 Drilling 100,000 100,000
For personal use only use personal For
109 PROSPECTUS
In the event that the minimum funds are raised, unless other forms of financing are available such as joint ventures or cashflow from operations, the drilling budgets for SMRV above would be reduced and it is likely that the Mt Paris and SMRV Projects would not be able to proceed without some other form of finance.
The Torque exploration/development program for its tenement interests has been planned to meet the requirements of the particular geological environments and exploration methodologies, which have been outlined in this Prospectus.
The exploration program and expenditures cover all of the tenements reviewed in this report. The program covers a wide range of technical activities but focuses on feasibility studies of known Indicated Resources, drill testing of defined prospects and extensions to existing mineralisation. Information derived from previous and future investigations will provide data for feasibility studies.
We consider that the planned exploration program is satisfactory and well defined and that the project and expenditure budgets are reasonable, having regard to the stated objectives of Torque, the prospectivity of the individual exploration areas and the exploration database already available. We are of the opinion that sufficient exploration work has taken place on Torque tenements and areas of interest over the past 9 years to justify the planned exploration programs and expenditure budgets.
Primary sources of data were all annual reports submitted to Mineral Resources Tasmania, for the SMRV and Moina Projects since 2001 as completed and lodged by Frontier Resources Ltd. Supplementary references are listed below: Aberfoyle Resources Limited; Cyprus Gold Australia Corporation. December 1991. Partial Relinquishment Report on exploration to December 1991. EL40/85, Elliott Bay, Tasmania. Aimex Geophysics, May 2012; Review of Wart Hill Geophysical Data. Aimex Geophysics, July 2012; Interpretation of 3DIP – Ti Tree, East Moina, Tin Spur, Narrawa and Bell Mt Areas. Amdel, August 2008. Project No. 2725, Wart Hill and Narrawa Creek Testwork Report. Anglo Australian Resources NL. July 1993. Annual Report 1/10/92 to 25/9/93. EL3/92 Thirkell Hill, Tasmania. Anglo Australian Resources NL. December 1994. Annual Report on exploration activity October 1993 to September 1994. EL3/92 Thirkell Hill. Anglo Australian Resources NL. August1995. Annual Report on exploration activity October 1994 to September 1995. EL3/92 Thirkell Hill. Anglo Australian Resources NL. December 1996. Annual Report 1996. EL3/92 Thirkell Hill. Anglo Australian Resources NL. August 1997. Annual Report 1997. EL3/92 Thirkell Hill. Askins, P.W. 1979. EL 7/74 Moina. Areas Covered by Moina Sheets 1, 2, 3, 1979 Update and Moina Sheet A. Report on all Investigations to August 1979. Comalco Unpub Rep (Open File). August 1979. Baker, T. 2003. Intrusionrelated gold deposits: Explorable characteristics. Unpublished Short Course Notes, School of Earth Sciences, James Cook University, Townsville. Berry, M.V. et al. 1998. Rosebery leadzincgoldsilvercopper deposit. AusIMM Monograph 22. 481486. Billiton Exploration Australia Limited. May 2000. Sirotem, Magnetic and Gravity Data review. Elliott Bay, Tasmania. Blake, F. 1937. Higgs’ Gold Mine – Narrawa Creek. Unpub Rep. Tas Geol Survey. Sept 1937. Bacon, C.A. 1992. Notes on previous mining and exploration activities in the Interview River area, Tasmanian Department of Mines Report 1992/31. Callaghan, T. et al. 1998. Henty gold deposit. AusIMM Monograph 22. 473479. Collins, P.L.F.; Williams, E. 1986. Metallongeny and tectonic development of the Tasman Fold Belt System in Tasmania. Ore Geology Reviews 1:153201. Collins, P.L.F.; Brown, S.G.; Dronseika, E.V.; Morland, R. 1989. MidPalaeozoic ore deposits, in: Burrett, C.F.; Martin, E.L.(ed). Geology and mineral resources of Tasmania. Special Publication Geological Society Australia 15:270292. Corbett, K.D. 1992. StratigraphicVolcanic Setting of Massive Sulphide Deposits in the Cambrian Mount Read Volcanics, Tasmania. Econ. Geol. Vol 87 : 564586. Corbett, K.D. 2001. New mapping and interpretations of the Mount Lyell mining district, Tasmania: a large hybrid CuAu system with an exhalative top: Economic Geology, v. 96, p. 108922. Cyprus Gold Australia Corporation. June 1986. Progress Report, 12 months to June 1986. EL40/85, Elliott Bay, Tasmania. Cyprus Gold Australia Corporation. June 1989. Progress Report, 12 months to June 1989. EL40/85, Elliott Bay, Tasmania. Dighem Ltd. 7 January 1981. Dighem survey of Birch Inlet area Tasmania for Geopeko Ltd. Douglas McKenna and Partners. 2003a. Final report on Dolcoath EL 37/97 Tasmania for Jervois Mining Limited. Douglas McKenna and Partners Pty Ltd [TCR 034846]. Douglas McKenna and Partners. 2003b. Final surrender report on Stormont EL 20/92 for Jervois Mining Limited. Douglas McKenna and Partners Pty Ltd [TCR
For personal use only use personal For 034850]. Exploration and Management Consultants Pty Ltd. March, 1998. EL 20/96 Elliott Bay Southwestern Tasmania. Annual Report 12/4/97 – 11/3/98. Exploration and Management Consultants Pty Ltd. March, 1998. EL 20/96 Elliott Bay Southwestern Tasmania. Annual Report 12/4/00 – 11/4/01.
110 Fimiston Mining NL. Annual Report for EL 20/96. Data Summary and Compilation Report. Period of Report 122/4/98 – 11/3/99. Eadie, E.T. et al. 1984. The application of Geophysics to the discovery of the Hellyer Ore Deposit, Tasmania. Explor. Geophys., Vol 16, No 213. Fimiston Mining NL. March 1998. Southern Geoscience Consultants Imaging Services. Elliott Bay, Tasmania. Fimiston Mining NL. March 1998. Silver Hill Prospect 1995 Moving Loop Sirotem Profiles. Elliott Bay, Tasmania. Fimiston Mining NL. March 1998. 1991 QUESTEM Survey Selected Profiles. Elliott Bay, Tasmania. Fleming, M.J. 1988. EL 26/85 – Narrawa, Annual Report 1987/1988. RGC Exploration Pty Ltd [TCR 882872]. Flis, M.F. 1982. Geophysical Surveys on the Dolcoath Granite Grid, Sheffield EL 7/73, North Tasmania. CA Exploration Unpub Rep (Open File). May 1982. Geopeko Ltd. Report on Exploration License 27/76, Elliott Bay, Tasmania. 11/813/82. TRC1882. Geopeko Ld. Annual Report on Exploration License 27/76, Elliott Bay, Tasmania. November 1983. TRC832076. Geopeko Ltd. Report on Exploration License 27/76, Elliott Bay, Tasmania 12/833/84. TRC852318. Geopeko Ltd. Final Report on Exploration License 27/76, Elliott Bay, Tasmania. October 1985. Geopeko Ltd/Union Oil Development Corporation. June 1978. EL9/74 Progress Report Birch Inlet Area. Geopeko Ltd/Union Oil Development Corporation. June 1981. EL9/74 Progress Report Birch Inlet Area. Geopeko Ltd/Union Oil Development Corporation. September 1977. Geophysical Progress Report on Birch Inlet. EL9/74 Tasmania. Geostat Services, May 2009. Narrawa Creek Project, Resource Estimate. Green, G.R. 1990. Palaeozioc Geology and Mineral Deposits of Tasmania. AusIMM. Monograph 14. Vol 2. Green, G.R. 1990. Geology of the Mineral Deposits of Australia. AusIMM, Melbourne. Green, G.R. et al, 1988. Mineral Deposits and Metallogenic Map of Tasmania, Department of Mines, Tasmania. Green, G.R. 1996. In: TasmanianCommonweath Regional Forest Agreement Background Report. Part D. Social and Economic Report Volume 111. Tasmanian Public Land Use Commission. Gulson, B.L., Large, R.R. and Porritt, P.M. 1987. Base metal exploration of the Mount Read Volcanics, Western Tasmania: Part 111. Application of lead isotopes at Elliott Bay. Economic Geology, Vol 82, p. 308327. Halley, S.W.. and Roberts, R.H., 1997, Henty: a goldrich volcanogenic massive sulfide deposit in Western Tasmania, Economic Geology, Vol 92, p. 438447. Hermann, W. July 2011. Exploration Potential of Exploration Licence 27/2011, Mt Paris, NE Tasmania. Report to Frontier Resources Ltd. Hermiston, C. February 2012. Volterra 3DIP Survey on the Moina Project. S.J. Geophysics Ltd. Hills, P.B. 1990. Mount Lyell Copper – Gold – Silver Deposits. AusIMM Monograph 14. Vol 2. Hills, P.B. 1998. Tasmania gold deposit, Beaconsfield. AusIMM Monograph 22. 467472. Hicks, J.D. and Sheppy, N.R. Tasmania Gold Deposit Beaconsfield. AusIMM Monograph 14. Vol 2: 1225 – 28. Jack, R. 1961. Gold Mine, Narrawa Creek, Moina. Tech. Rep. Dept of Mines, Tas. 5 : 102104. Jannink, A. 2002. Annual Report to 3 April 2002 on Dolcoath EL 37/1997 Tasmania for Jervois Mining NL. Douglas McKenna and Partners Pty Ltd [TCR 02 4648] Jennings, I.B., 1958. The Round Mt District, Geological Survey Tasmania Bulletin 45. Jennings, I.B., 1963. Geology of the Middleson Short, Geological Survey Tasmania. Jennings, I.B., 1965. Middlesex mineral district. Proceedings Eighth Commonwealth Mining and Metallurgy Congress 1:512514. Jennings, I.B., 1979. Exploratory Report, Sheffield, Geological Survey Tasmania. Jennings, I.B. 1979. Sheffield. Explanatory Report, 1 Mile Map Series. Geol Surv. Tas Dept of Mines. Kwak, T.A.P.; Askins, P.W. 1981. Geology and genesis of the FSnW(BeZinc) skarn (wrigglite) at Moina, Tasmania. Economic Geology 76:439467. Lang, J.R.; Baker, T. 2001. Intrusionrelated gold systems: the present level of understanding. Mineralium Deposita 36:477489. Large, R.R. 1985. University of Tasmania. Notes on the Voyager 24 Gold Mineralisation. Large, R.R. 1987. The Mineral Wealth of Western Tasmania and the potential of the South Western Conservation Area. Tasmania Chamber of Mines. Large, R.R. et al. 1987. Base Metal Explortion in the Mt Read Volcanics, Western Tasmania. Part 1: Geology and Exploration, Elliott Bay. Econ. Geol. Vol 82, No2. Large, R.R. 1992. Australian Volcanic – Hosted Massive Sulfide Deposits: Features, Styles and Genetic Models. Econ, Geol. Vol 87: 471510. Large, R.R. et al., 2001. The spectrum of ore deposit types, volcanic environments, alteration halos, and related exploration vectors in submarine volcanic successions: Some examples from Australia: Economic Geology, v. 96, p. 913938. Leaman, D.E. 1988. Gravity and Magnetic Evaluation, Moina Region. 1. Magnetic Data: Initial Review. Unpub Rep for RGC Exploration. August 1988. Leaman, D.E.; Richardson, R.G. 1989. The granites of west and northwest Tasmania – a geophysical interpretation. Bulletin Geological Survey Tasmania 66. Leaman, D.E.; Richardson, R.G. 2003. A geophysical model of the major Tasmanian granitoids. Record Tasmanian Geological Survey 2003/11. Lees, T. et al. 1990. Rosebery and Hercules CopperLeadZinc Deposits. AusIMM Monograph 14. Vol 2: 124147. Little River Goldfields, 1993. Quarterly Report. MacDonald, G. August 1994. Elliott Bay, Tasmania. An appraisal of previous exploration and existing potential in the southern most part of the Mt Read Volcanics.
For personal use only use personal For MacDonald, G. January 1997. EL 20/96 – Elliott Bay Western Tasmania. A review. Appendices A to O. Figures 1 to 250. MacDonald, G. April 2009. Stormont Gold and Bismuth Project, Resource Estimate.
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MacDonald, G. May 2009. Narrawa Gold and Base Metal Project, Resource Review. MacDonald, G. April 2012. Stormont + gold + bismuth Project, Resource Estimate. MacDonald, G. June 2012. Resource Estimation for Wart Hill Project, Elliot Bay, Tasmania. Macmin N.L. Thirkell Hill Project. Compilation of Prospectus, Quarterly and Other reports. McNeil Associates. November 1992. Summary Report EL3/92 Thirkell Hill Tasmania. Mitre Geophysics Pty Ltd. Jan 1988. A compilation of geophysical surveys carried out at Elliott Bay (EL27/76) for Cyprus Minerals Australia Company. Mineral Resources Tasmania. February 2000. Mineral Exploration Opportunities in Tasmania. McArthur, G.J. and Dronseika, E.V. 1990. Que River and Hellyer Zinc – Lead – Silver Deposits. AusIMM Monograph 14. Vol 2: 122939. Morrison, K.C. et al, 2003. The Dolcoath Granite: A Gold Extension Target. Tasmanian Geological Survey Record 2003/16. Morrison, K.C.; Reed, A.R.; Turner, N.J. 2003. Western Tasmanian Regional Minerals Program Devonian Granite Aureoles Project. Regional map set and geophysical signatures. Record Geological Survey Tasmania 2003/13. Newnham, L.A. 1993. Annual Report 199293. E.L. 20/92. Moina Area – Northern Tasmania. Goldstream Mining NL Fiche No. 01293435. Newnham, L.A. 1997. Relinquishment report for part of EL 20/92 – Moina area. Newnham Exploration and Mining Services [TR 974031]. Newnham, L.A. 1997a. EL 20/92, Moina Area – Northern Tasmania. Report for 12Month Period Ending 30 April, 1997. Goldstream Mining Unpub Rep (Closed File). April 1997. Newnham, L.A. 1997b. Relinquishment Report for Part of EL 20/92, Moina Area. Goldstream Mining Unpub Rep (Open File). July 1997. Nuston, D.L. & Kamprad, J., 2001. Zonation of alteration facies at Western Tharsis: Implications for the genesis of CuAu deposits, Mount Lyell field, Western Tasmania: Economic Geology, v. 96, p. 11231132. Plutonic Operations Limited. February 1996. Annual Report Exploration License 53/94. Elliott Bay, Tasmania. February 1995 to January 1996. Pemberton. J., and Corbett, K.D. 1992. Stratigraphic – facies associations and their relationship to mineralisation in the Mount Read Volcanics. Bull. Geol. Surv. Tasm. 70 : 167176. Purvis, J.G. 1988. Tasmanian Tin Prospects, Part 2, NE Tasmanian Tin Province: Consultant’s Report, J.G. Purvis & Associates for: Aberfoyle Resources Ltd., 60p., TCR 06_5259. Purvis, J.G. 1999. Dolcoath EL 37/97, Tasmania. First Progress Report. Jervois Mining Unpub Rep (Closed File). January 1999. Purvis, J.G. 2000. Dolcoath EL 37/97 Tasmania, Second Progress Report. Jervois Mining NL [TCR 004423]. Reid, J. 2003. Western Tasmanian Regional Minerals Program. Helicopter electromagnetic data (HEM) – processing, quality control and interpretation. Record Tasmanian Geological Survey 2003/09. Roberts, R.H. 1986. EL 41/83 – Lake Lea area, Annual Report 1985/86. Goldfields Exploration Pty Ltd [TCR 862619]. Roberts, R.H. 1987. EL 26/85 – Narrawa, Annual Report 1986/87. Goldfields Exploration Pty Ltd [TCR 872739]. Staff, Aberfoyle Resources Ltd. Geology and Discovery of the Que River and Hellyer polymetallic sulphide ores. AusIMM Monograph 17 : 187196. Swain Engineers, July 2012. Conceptual Mining Study for the Narrawa and Stormont Deposits. TasGold Ltd. October 26, 1993. Prospectus, December 2002. TasGold Ltd. 2003. Prospectus. Taylor, A.C. 1990. Gold bearing skarns from the Moina Area northwest Tasmania. B.Sc. (Hons) thesis, University of Tasmania : Hobart. Thompson, J.F.H.; Sillitoe, R.H.; Baker, T.; Mortensen, J.K. 1999. Intrusionrelated gold deposits associated with tungstentin provinces. Mineralium Deposita 34:323334. TNT Mines Ltd, November 2011. Replacement Rights Issue Prospectus. Union Oil Development Corporation. August 1975. EL9/74 Birch Inlet Annual Report. Webb, P.N. 1974. The Dolcoath Granite contact aureole. B.Sc. (hons) thesis, University of Tasmania : Hobart. Weber, G.B. 1982. Exploration in the Vicinity of the Dolcoath Granite, EL 7/73 Sheffield, Northern Tasmania. CRA Exploration Unpub Rep (Open File). Dec 1982
Acid volcanics Volcanic rocks with high content of quartz Aeromagnetic survey A survey made from the air to record the magnetic characteristics of rocks Ag Silver Airborne EM (AEM) A survey made from the air to record the electromagnetic characteristics of rocks Alluvial A deposit formed by processes activated by running water Alteration Change in mineralogical composition of a rock commonly brought about by reactions with hydrothermal solutions Andesite A volcanic rock intermediate in composition between basalt and rhyolite Anomaly Value significantly different to the norm – usually a good thing Antimony A white metallic element Argillic Clay alteration Arsenic Semimetallic element, provides a geochemical indicator of possible gold mineralisation
For personal use only use personal For As Arsenic Au Gold Auger drilling Drill method in which sample is returned to surface by moving up a steel spiral attached to drill rods
112 Aureole (metamorphic) The zone around an igneous mass within which thermal effects has occurred
Ba Barium Basalt A fine grained volcanic rock composed primarily of plagioclase feldspar and mafic minerals Base metal A nonprecious metal usually refers to copper, zinc, lead and nickel Basement Bedrock Basic Igneous rocks with low silica content Bedrock Solid rock underlying unconsolidated material Bi Bismuth BLEG Bulk leach extractable gold Breccia A rock consisting of angular fragments in a finer grained matrix Bulk leach A laboratory technique whereby a sample is treated with a leaching agent (i.e. cyanide) to extract a particular mineral
Cambrian The period in geological time between 530 and 460 million years ago Carbonaceous Rich in carbon/organic matter Carboniferous Geological time period from about 345 to 280 million years Chalcopyrite A copperiron sulphide mineral Channel sample Sample obtained by cutting a rectangular channel across a rock face Chargeability A measure of the ability of a material to hold an electric charge Chemical analysis Accurate laboratory determination of the concentration of a given element in a sample Chert Very fine grained rock composed of silica Chlorite A green plate ironmagnesium rich silicate mineral Conductivity Geophysical anomaly relating to electrical conductivity often associated with sulphides Conglomerate A cemented clastic rock containing rounded fragments of pebble or larger sized gravel Costean A trench Country rock Term applied to rock surrounding or penetrated by mineral veins Cr Chromium Cu Copper Cupola A small dome like feature projecting from the min body of a larger igneous intrusion
Devonian A period of geologic time between 345 and 395 million years ago Diamond core drill holes Rotary drilling using diamond impregnated bits to produce a solid continuous core sample of the rock Dighem A proprietary airborne electromagnetic survey system Dilational (zones) An area that opens up or expands, often along a fault zone Dip The angle at which a rock layer, fault, or any other plane or surface is inclined from the horizontal Disseminated Fine particles of mineral dispersed through the enclosing rock
EL Exploration License in Tasmania Electrum Naturally occurring gold with greater than 20% admixed silver Electromagnetic survey EM – a geophysical exploration method based on measuring magnetic fields using artificially induced currents into the ground Eluvium Weathered material at, or near its point of formation Epidote A low temperature mineral occurring mainly in low grade regionally metamorphosed rocks
Facies The aspects of a rock unit reflecting the conditions of its origin Fault A fracture in rocks along which there has been relative movement either vertically or horizontally Fe Iron Fence A linear series of drill holes, often inclined and overlapping Fissure vein A vein occurring in a linear vent or crack Float Rock material dispersed from bedrock Fold A bend in strata or in any planar structure Foliation Parallel orientation of platy minerals Fragmental tuff A rock formed by volcanic processes and containing fragments greater than 2cm
g/t (ppm) Grams per tonne (parts per million), a measure of precious metal content in a sample Gabbro A coarse grained rock consisting of plagioclase and mafic minerals Galena A mineral, lead sulphide, the dominant ore mineral of lead Geochemical anomaly The occurrence of higher than average content of an element in rock or soil Geochemistry Study of variation of chemical elements in rocks or soils
For personal use only use personal For Geophysics Study of the earth by quantitative physical methods Gneiss Applied to banded rocks formed during highgrade regional metamorphism Gossan A surface capping of oxides of iron from the weathering of metallic sulphide
113 PROSPECTUS
Grade (To contain a particular) quantity of ore or mineral relative to other constituents, in a specified quantity of rock Granite A coarse grained igneous rock which contains 2040% quartz Granodiorite A coarse grained acid igneous rock, similar to granite but with a lower percentage of silica Greywacke A grey indurated sandstone consisting of poorly sorted grains of quartz, feldspar and rock fragments in a clay matrix Grid A systematic array of points or lines
Hematite A mineral composed of iron oxide; one of the most common ores or iron Hg Mercury Hornfels A fine to medium grained rock produced by thermal metamorphism Huminex An analysis previously run by MRT from humus samples Hydrothermal A process of ore formation in which mineral solutions are deposited from hot aqueous solutions
Induced Polarization (IP) A surface electrical/geophysical surveying technique Intermediate Igneous rocks whose composition is intermediate between acid and mafic rocks Intrusive Having been injected into the earths crust whilst molten and solidifying before reaching the surface
Landstat Image (MSS) The image on the cover of Tasmania obtained by satellite Lava The material extruded from a volcano, which consists of molten or part molten silicate material Leaching The dissolution of mineral components in rocks and ores by acids or other reagents Lineament A largescale linear feature as evidenced by topography, which may represent underlying structural features Lithic crystal tuff(s) A volcanic rock containing rock fragments and identified minerals Lode A tabular or vein like deposit of valuable mineral between well defined walls of country rock
Mafic Descriptive of rocks composed dominantly of magnesium and iron rockforming silicates Magnetic survey A geophysical technique which measures variations in earths magnetic field Magnetite A magnetic iron oxide mineral Massive Sulphide Any mass if abundant metallic sulphide minerals, usually of Zinc, Pb, Cu, Fe and related to volcanism Mesh fraction A sizing system used to screen samples prior to their chemical analysis Mesothermal Hydrothermal mineral (deposit) formed in the 200300 degree range and at depth Metamorphosed A rock that has been altered by physical and chemical process involving heat pressure and derived fluids Metasediments Sediments that have been metamorphosed Mineral resource A tonnage or volume of rock or mineralisation of intrinsic economic interest Mineralisation The concentration of metals and their chemical compounds within a body of rock ML Mining Lease Mn Manganese Mo Molybdenum MRT Mineral Resources Tasmania – Department of Infrastructure, Energy and Resources (Mines Dept) MRV Mount Read Volcanics are an ~northsouth trending zone of volcanic and related rocks in the west of Tasmania. It is probably Tasmania’s most highly mineralised zone Mullock Waste rock often located around old workings
Open cut, open pit A mine worked at the surface Ordivician The period in geological time between 500 and 435 million years ago Ore Material that can be mined and treated at a profit Outcrop The surface expression of a rock layer Oxidised Decomposed by exposure to oxygen in the atmosphere and groundwater
Palaeogeographic The geography of past and ancient (fossil) times Palaeozoic Era in geological history from the preCambrian to the Mesozoic or about 570 to 225 million years ago Pan concentrate The residual heavy fraction remaining after panning a sample from a stream trap site. Assay values >1g/t au are considered anomalous Pb Lead Percussion Drilling A drilling method, which utilizes a hammering action and rotation to penetrate rock Permian Period in geological history from about 286 to 248 million years ago Petrographic Pertaining to the optical study of rocks PGM Platinum group metals Phyric Indicates a porphyritic rock Pleistocene One of the seven subdivisions of the Tertiary period in the geological timescale Porphyry A medium grained igneous rock containing crystals of any material
For personal use only use personal For Porphyry Cu A copper deposit in which the copper minerals occur as discrete grains and veinlets throughout a large volume of rock PPB Parts per billion (1,000 million) PreCambrian The period of geological time prior to 540 million years ago (~=90% of all time)
114 Proterozoic The more recent period of the PreCambrian Pyrite A yellow iron sulphide mineral Pyroclastic Fragmental deposits formed from the accumulation of volcanic ejections
Quartzite A silica rich metamorphic rock formed from sandstone Quaternary A period in geological time from 1.8 million years ago to the present day QUESTEM A proprietary form of AEM
Radiometrics The measurement of radiation produced by the spontaneous decay of certain atoms Reserve(s) Insitu quantity of mineralised rock of known grade from which the contained metal can be recovered economically taking into consideration, geological mining, social, political, and environmental factors. Quantity and grade better established than for Resource(s) Resistivity survey A geophysical technique which measures the electrical resistance of rocks in the ground Resource(s) Insitu quantity of mineralised rock of known grade, the extent of which has been estimated on the basis of geological information and from which the contained metal may be recoverable economically Reverse circulation (RC) A drilling method in which the sample is brought to the surface inside the drill rods Rhyolite Fine grained acid volcanic rock
Sandstone Sedimentary rock composed of sandsized grains Schist A metamorphic rock with platy to foliated texture Sericite A fine grained white micaceous mineral Shale A fine grained sedimentary rock formed from clay, mud and silt Shear A zone where lateral movement along parallel planes produces deformation of rock Silicification The process whereby original rock minerals are chemically replaced by various forms of silica Siltstone A fine grained sedimentary rock composed largely of siltsized particles Sirotem A proprietary electromagnetic survey technique Skarn A thermally metamorphosed impure limestone SMRV Torque project area in SW Tasmania, covering the bulk of the highly prospective MRV south of Macquarie Harbour Sn Tin Soil Sampling Systematic collection of soil samples at different locations in order to study the distribution of elements in the soil horizons SP (self potential) A geophysical technique which measures the natural earth currents at the ground surface Sphalerite A zinciron sulphide mineral; a major economic source of zinc Stockwork An interfacing system of small veins or lodes Stratabound Said of a deposit confined to a single stratigraphic unit Stratiform A type of stratabound deposit that has layered ore minerals Stream Sediment Drainage sample usually consisting of 80mesh (small) fraction of active stream silt and sediment. Values >0.1 are generally anomalous Strike Horizontal direction or trend of a geologic structure Stringer A narrow vein of mineral traversing a rock mass of different composition Supergene A type of mineral deposit formed by weathering or alteration formed by descending solution Syncline A fold that is concave up, with younger rocks in the middle Syngenetic A mineral deposit which is said to have formed at the same time as the enclosing rocks
Tailings Reject products from a mineral treatment plant TEM A proprietary ground electromagnetic survey technique Tertiary The period of geological time between 65 and 1.8 million years ago Tuff A rock formed of fine grained material from a volcanic explosion Tuffaceous A rock which contains pyroclastic material Turair A proprietary airborne electromagnetic survey system Turbidite A sedimentary rock formed by turbidity (density) currents along a sloping ocean floor
UTEM A proprietary ground electromagnetic survey technique
V19 Voyager Prospect 19 (also called Wart Hill) in Torque’s SMRV – Elliott Bay license. Named by Geopeko up to V35 VHMS Volcanic hosted massive sulphide – high grade and value deposits related to silicic volcanism. They are prime targets in the SMRV VLFEM A ground geophysical survey technique utilising very low frequencies Volcaniclastic Describes clastic fragments of volcanic origin, often consolidated as sediments VTEM Airborne electromagnetic survey
For personal use only use personal For Zn Zinc
115 PROSPECTUS
5. INVESTIGATING ACCOUNTANT’S REPORT
Gold Coast Ref: DJ:KM/TORMIN/93819
15 January 2013
The Directors Torque Mining Ltd PO Box 7792 GOLD COAST MAIL CENTRE QLD 9726
Dear Sirs
INVESTIGATING ACCOUNTANT’S REPORT
INTRODUCTION
This Investigating Accountant’s report (“Report”) has been prepared for inclusion in a prospectus to be dated on or about 1525 January 2013 (“Prospectus”) for the issue by Torque Mining Limited (“Torque” or “Company”) of up to 20,000,000 ordinary shares at an issue price of 20 cents each to raise up to $4,000,000 before the expenses of the issue. The minimum subscription under the Prospectus is $3,000,000 and the Company will accept oversubscriptions of up to 5,000,000 ordinary shares at an issue price of 20 cents each to raise an additional $1,000,000 before expenses.
This Report has been included in the Prospectus to assist potential investors and their financial advisers to make an assessment of the financial position and performance of Torque Mining Limited.
STRUCTURE OF REPORT
This Report has been divided into the following sections:
1. Background information; 2. Scope of Report; 3. Financial information; 4. Subsequent events; 5. Statements;1. Statements; and and 6. Declaration2. Declaration
1. BACKGROUND INFORMATION
The Company was incorporated on 20 March 2012. The current directors of the Company are Peter McNeil, Robert McNeil, Graham Fish and Jay Stephenson.
The Company was formed with the intention of developing mineral resources in Tasmania held, at the time, by parent company Frontier Resources Limited (“Frontier”), and for the continued exploration of, and further development of, mineral exploration projects also held by Frontier in Tasmania.
The Tasmanian projects held by Frontier were transferred to Torque, a wholly owned subsidiary of
Frontier, in May 2012. For personal use only use personal For
116 -2- Torque Mining Ltd 15 January 2013
Consideration for the acquisition of these mineral resources comprised the issue by Torque to Frontier of 40,000,000 fully paid ordinary shares of $0.05 each in Torque.
As at the date of this Report, the issued share capital of the Company is 60,940,002 ordinary fully paid shares.
The following table summarises share capital movements since registration.
Date Number Issue Issued Price $
20 March 2012 Shares issued on registration 2 $1.00 2
5 July 2012 Shares issued to parent entity 40,000,000 $0.05 2,000,000
31 July 2012 Shares issued – seed capital 20,940,000 $0.05 1,047,000
Shares on issue at the date of this report 60,940,002 $3,047,002
The Company has 4,000,000 options on issue at the date of this Report.
The company will also issue 1 free attaching listed option exercisable at $0.30 on or before 31 March 2016 for every share that is applied for in the capital raising.
The intended intended use use of of the the funds funds raised raised by the by theissue issue of shares of shares under underthe Prospectus the Prospectus is specified is specified in Section in Investment7 of the Prospectus. Overview section of the Prospectus.
2. SCOPE OF REPORT
You have requested HLB Mann Judd (“HLB”) to prepare this Report for inclusion in the Prospectus covering the following information of the company:
a) the historical financial information comprising the historical Statement of Financial Position as at 30 November 2012, Statement of Comprehensive Income and Statement of Changes in Equity for the period from registration to 30 November 2012 as set out in Appendix 1 to this Report; and
b) the proforma financial information comprising the proforma Statement of Financial Position as at 30 November 2012 and the proforma Statement of Comprehensive Income and Statement of Changes in Equity for the period then ended. This information is presented under the following two scenarios:
$3,000,000 capital raising (minimum subscription), and $5,000,000 capital raising (including over subscriptions)
The Directors have prepared and are responsible for the historical and proforma financial information, including the determination of the proforma adjustments. It is our responsibility to review the historical and proforma financial information as set out in Section 5 7 of the Prospectus. We disclaim any responsibility for any reliance on this Report or on the financial information to which it relates for any purposes other than that for which it was prepared. This Report should be read in conjunction with the full Prospectus.
The historical financial information as set out in Appendix 1 has been extracted from the unaudited financial statements of the Company for the period ended 30 November 2012.
We performed a review of the historical financial information and the proforma financial information of the Company as at 30 November 2012 in order to ensure consistency in the application of applicable Accounting Standards and other mandatory professional reporting requirements. Our review has been conducted in accordance with Australian Auditing Standards applicable to review engagements.
For personal use only use personal For Our review of the historical financial information of the Company and the proforma information of the company was carried out in accordance with Australian Auditing Standard ASRE 2410 ‘Review of an Interim Financial Report performed by the Independent Auditor of the Entity’ and included such enquiries and procedures which we considered necessary for the purposes of this Report. The review
HLB Mann Judd (Gold Coast) Pty Ltd Chartered Accountants
117 PROSPECTUS
-3- Torque Mining Ltd 15 January 2013
procedures undertaken by HLB in our role as Investigating Accountant were substantially less in scope than that of an audit examination conducted in accordance with generally accepted auditing standards. Our review was limited primarily to an examination of the historical financial information and the proforma information, analytical review procedures and discussions with senior management. A review of this nature provides less assurance than an audit and, accordingly, this Report does not express an audit opinion on the historical financial information and proforma information included in this Report or elsewhere in the Prospectus.
In relation to the information presented in this Report:
a) support by another person, corporation or an unrelated entity has not been assumed;
b) the amounts shown in respect of assets do not purport to be the amounts that would have been realised if the assets were sold at the date of this Report; and
c) the going concern basis of accounting has been adopted
3. FINANCIAL INFORMATION
Set out in Appendix 1 (attached) are:
a) The Statement of Financial Position of the Company as at 30 November 2012, and the Statement of Comprehensive Income and Statement of Changes in Equity for the period from registration to 30 November 2012; and
b) The proforma Statement of Financial Position of the Company as at 30 November 2012 and proforma Statement of Comprehensive Income and Statement of Changes in Equity for the period then ended as they would appear after incorporating the following significant events and proposed transactions by the Company subsequent to 30 November 2012:
i) the issue by the Company pursuant to this Prospectus of 20,000,000 ordinary shares, issued at a price of $0.20 per share, raising $4,000,000;
ii) the write off to the issued capital account of the estimated costs of the Prospectus of $556,350, as detailed below;
Total Application Handling Fees 180,000 ASIC & ASX fees 68,090 Legal fees 50,000 Investigating Accountant’s fees 7,500 Independent Geologist’s fees 36,600 Corporate Advisory Fees 81,000 Sponsoring Broker Fee 100,000 Printing and associated costs 25,660 Share Registry 7,500 $556,350
iii) the issue to a supplier by the Company of 360,000 ordinary shares issued at 5 cents each for settlement of services rendered;
This information is presented under the following two scenarios: $3,000,000 capital raising (minimum subscription) $5,000,000 capital raising (including over subscriptions) – on this basis the total estimated costs of the Prospectus will increase by $154,500 to $710,850
For personal use only use personal For c) Notes to the historical financial information and proforma information.
HLB Mann Judd (Gold Coast) Pty Ltd Chartered Accountants
118 -4- Torque Mining Ltd 15 January 2013
4. SUBSEQUENT EVENTS
In our opinion, there have been no material items, transactions or events subsequent to 30 November 2012 not otherwise disclosed in the Prospectus that have come to our attention during the course of our review that would require comment in, or adjustment to, the content of this Report or which would cause such information included in this Report to be misleading.
5. STATEMENTS
Based on our review, which was not an audit, we have not become aware of any matter that causes us to believe that:
a) the historical financial information of Torque Mining Limited as at 30 November 2012 as set out in Appendix 1 of this Report, does not present fairly the financial position of the Company as at that date in accordance with the measurement and recognition requirements (but not all of the disclosure requirements) of applicable Accounting Standards and other mandatory reporting requirements in Australia and its performance as represented by its results of its operations for the period from registration to 30 November 2012; and
b) the proforma information of Torque Mining Limited as at 30 November 2012 as set out in Appendix 1 of this Report, does not present fairly the financial position of the Company as at that date in accordance with the measurement and recognition requirements (but not all of the disclosure requirements) of applicable Accounting Standards and other mandatory reporting requirements in Australia and its performance as represented by its results of its operations for the period ended 30 November 2012, as if the transactions referred to in Section 3 (b) of this Report had occurred during that period.
6. DECLARATION
a) HLB will be paid its usual professional fees based on time involvement, for the preparation of this Report, the review of the financial information at our normal professional rates (expected to be $7,500 plus GST).
b) Apart from the aforementioned fee, neither HLB, nor any of its associates will receive any other benefits, either directly or indirectly, for or in connection with the preparation of this Report.
c) Neither HLB, nor any of its employees or associated persons has any interest in Torque Mining Limited or the promotion of the Company.
d) Unless specifically referred to in this Report, or elsewhere in the Prospectus, HLB was not involved in the preparation of any other part of the Prospectus and did not cause the issue of any other part of the Prospectus. Accordingly, HLB makes no representations or warranties as to the completeness or accuracy of the information contained in any other part of the Prospectus.
e) HLB has consented to the inclusion of this Report in the Prospectus in the form and context in which it appears. The inclusion of this Report should not be taken as an endorsement of the Company or a recommendation by HLB of any participation in the Company by an intending subscriber.
Yours sincerely
David Jackson Director
For personal use only use personal For HLB Mann Judd (Gold Coast) Pty Ltd Direct Line: (07) 5577 7104 E-mail: [email protected]
HLB Mann Judd (Gold Coast) Pty Ltd Chartered Accountants
119 PROSPECTUS
APPENDIX 1
TORQUE MINING LIMITED STATEMENT OF FINANCIAL POSITION AS AT 30 NOVEMBER 2012 Proforma $3M raising $5M raising 2012 Notes $ $ $ ASSETS CURRENT ASSETS Cash and cash equivalents 2 443,251 2,965,457 4,810,957 Trade and other receivables 3 20,294 20,294 20,294 TOTAL CURRENT ASSETS 463,545 2,985,751 4,831,251
NON CURRENT ASSETS Other Financial Assets 1,800 1,800 1,800 Exploration & Evaluation Expenditure 4 2,518,592 2,518,592 2,518,592 Property, plant and equipment 5,597 5,597 5,597 TOTAL NON CURRENT ASSETS 2,525,989 2,525,989 2,525,989
TOTAL ASSETS 2,989,534 5,511,740 7,357,240
LIABILITIES CURRENT LIABILITIES Trade and other payables 5 278,303 260,303 260,303 TOTAL CURRENT LIABILITIES 278,303 260,303 260,303
NON CURRENT LIABILITIES 0 0 0 TOTAL NON CURRENT LIABILITIES 0 0 0
TOTAL LIABILITIES 278,303 260,303 260,303
NET ASSETS 2,711,231 5,251,437 7,096,937
EQUITY Issued capital 6 2,968,446 5,508,652 7,354,152 Accumulated losses (257,215) (257,215) (257,215)
TOTAL EQUITY 2,711,231 5,251,437 7,096,937
For personal use only use personal For This statement should be read in conjunction with the accompanying notes.
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TORQUE MINING LIMITED STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD FROM REGISTRATION TO 30 NOVEMBER 2012
Proforma Reviewed $3M raising $5M raising $ $ $
Income from ordinary activities 11,232 11,232 11,232
Administrative services 191,774 191,774 191,774 Other expenses 76,673 76,673 76,673 Profit (Loss) before income tax expense (257,215) (257,215) (257,215) Income tax expense 0 0 0 Profit (Loss) after income tax expense (257,215) (257,215) (257,215) Other comprehensive income 0 0 0 Total comprehensive loss for the period (257,215) (257,215) (257,215)
This statement should be read in conjunction with the accompanying notes.
TORQUE MINING LIMITED STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD FROM REGISTRATION TO 30 NOVEMBER 2012
Issued Reserves Accumulated Capital Losses Total $ $ $ $
Shares issued on incorporation 2 0 0 2 Shares issued during the period 3,047,000 0 0 3,047,000 Share issue costs - cash (78,556) 0 0 (78,556) Comprehensive loss for the period 0 0 (257,215) (257,215) As at 30 November 2012 2,968,446 0 (257,215) 2,711,231
$3M raising Proforma adjustments: Shares issued pursuant to Prospectus 3,000,000 0 0 3,000,000 Share issue costs - cash (477,794) 0 0 (477,794) Share issue for settlement of services rendered 18,000 0 0 18,000 $3M raising Proforma Total 5,508,652 0 (257,215) 5,251,437
$5M raising Proforma adjustments: Additional shares issued pursuant to Prospectus 2,000,000 0 0 2,000,000 Additional share issue costs (154,500) 0 0 (154,500) $5M raising Proforma Total 7,354,152 0 (257,215) 7,096,937
For personal use only use personal For
This statement should be read in conjunction with the accompanying notes.
121 PROSPECTUS
TORQUE MINING LTD NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD FROM REGISTRATION TO 30 NOVEMBER 2012
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies which have been adopted in the preparation of the historical and proforma financial information reported under Australian Equivalents to International Financial Reporting Standards (“AIFRS”) are shown below.
(a) Basis of Accounting
The financial statements have been prepared in accordance with the measurement requirements (but not all of the disclosure requirements) of applicable Accounting Standards and other mandatory professional reporting requirements in Australia using the accrual basis of accounting, including the historical cost convention.
(b) Statement of compliance
The financial information complies with Australian Accounting Standards, which include Australian equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial information, comprising the financial statements and notes thereto, complies with measurement requirements but not all of the disclosure requirements of the International Financial Reporting Standards (IFRS).
(c) Critical accounting estimates and judgements
The application of accounting policies requires the use of judgements, estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are recognised in the period in which the estimate is revised if it affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.
(d) Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.
Interest income is recognised as it accrues.
(e) Income Tax
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements, and to unused tax losses.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when the assets are recovered or liabilities settled. The relevant tax rates are applied to the cumulative amounts of deductible and taxable temporary differences to measure the deferred tax asset or liability. An exemption is made for certain temporary differences arising from the initial recognition of an asset or liability. No deferred tax asset or liability is recognised in relation to these temporary differences if they arose in a transaction, other than a business combination that, at the time of the transaction, that did not affect either accounting profit or
For personal use only use personal For taxable profit or loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.
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NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.
(f) Goods & Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST except:
when the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and the net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.
(g) Cash and cash equivalents
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
(h) Trade and other receivables
Trade receivables are measured on initial recognition at fair value and are subsequently measured at amortised cost, less any allowance for impairment. Trade receivables are generally due for settlement within periods ranging from 15 days to 45 days.
Impairment of trade receivables is continually reviewed and those that are considered to be uncollectible are written off by reducing the carrying amount directly. An allowance account is used when there is objective evidence that the Company will not be able to collect all amounts due according to the original contractual terms. Factors considered by the Company in making this determination include known significant financial difficulties of the debtor, review of financial information and significant delinquency in making contractual payments to the Company. The impairment allowance is set equal to the difference between the carrying amount of the receivable and the present value of estimated future cash flows.
The amount of the impairment loss is recognised in the statement of comprehensive income within other expenses. When a trade receivable for which an impairment allowance had been recognised becomes uncollectible in a subsequent period, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against other expenses in the statement of comprehensive income.
(i) Financial assets
Financial assets in the scope of AASB 139 Financial Instruments: Recognition and Measurement are classified as either financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, or available-for-sale investments, as appropriate. When financial assets are recognised initially, they are measured at fair value plus, in the case of investments not at fair value through profit or loss, net of directly attributable transaction costs. The Company determines the classification of its financial assets after initial recognition and, when allowed and appropriate, re-evaluates this designation at each financial year-end. All regular way purchases and sales of financial assets are recognised on the trade date i.e. the date that the Company commits to purchase the asset. Regular way purchases or sales are purchases or sales of financial assets under contracts that require delivery of the assets within the period established
For personal use only use personal For generally by regulation or convention in the marketplace.
123 PROSPECTUS
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(i) Loans and receivables
Loans and receivables are non derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for those with maturities greater than 12 months after the end of the reporting period which are classified as non-current assets.
Loans and receivables are measured at amortised cost using effective interest method less any impairment losses.
(j) Impairment of financial assets
The Company assesses at each balance date whether a financial asset or group of financial assets is impaired.
(i) Financial assets carried at amortised cost
If there is objective evidence that an impairment loss on loans and receivables carried at amortised cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate (i.e. the effective interest rate computed at initial recognition). The carrying amount of the asset is reduced either directly or through use of an allowance account. The amount of the loss is recognised in profit or loss.
The Company first assesses whether objective evidence of impairment exists individually for financial assets that are individually significant, and individually or collectively for financial assets that are not individually significant. If it is determined that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, the asset is included in a group of financial assets with similar credit risk characteristics and that group of financial assets is collectively assessed for impairment. Assets that are individually assessed for impairment and for which an impairment loss is or continues to be recognised are not included in a collective assessment of impairment.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed. Any subsequent reversal of an impairment loss is recognised in profit or loss, to the extent that the carrying value of the asset does not exceed its amortised cost at the reversal date.
(k) Property, plant and equipment
Plant and equipment is stated at cost. Such cost includes the cost of replacing parts that are eligible for capitalisation when the cost of replacing the parts is incurred. Similarly, when each major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement only if it is eligible for capitalisation.
Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows:
Plant and equipment – over 5 to 15 years
The assets' residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each financial year end.
(l) Property, plant and equipment (continued)
For personal use only use personal For (i) Impairment
The carrying values of plant and equipment are reviewed for impairment at each balance date, with recoverable amount being estimated when events or changes in circumstances indicate that the carrying value may be impaired.
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NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
The recoverable amount of plant and equipment is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.
For an asset that does not generate largely independent cash inflows, recoverable amount is determined for the cash-generating unit to which the asset belongs, unless the asset's value in use can be estimated to approximate fair value.
An impairment exists when the carrying value of an asset or cash-generating units exceeds its estimated recoverable amount. The asset or cash-generating unit is then written down to its recoverable amount.
(ii) Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.
Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the year the asset is derecognised.
(m) Trade and other payables
Trade payables and other payables are carried at amortised cost and represent liabilities for goods and services provided to the Company prior to the end of the financial year that are unpaid and arise when the Company becomes obliged to make future payments in respect of the purchase of these goods and services. Trade and other payables are presented as current liabilities unless payment is not due within 12 months.
(n) Interest-bearing loans and borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost.
(o) Issued capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options for the acquisition of a new business are not included in the cost of acquisition as part of the purchase consideration.
(p) Exploration and evaluation expenditure
The Company has adopted a policy of writing off exploration and evaluation expenditure at the end of the period in which it is incurred, unless a mineral resource has been estimated for the area of interest.
The Directors believe that this policy results in the carrying value of exploration expenditure more appropriately reflecting the definition of an asset, being future benefits controlled by the Company. Costs arising from exploration and evaluation activities are carried forward where these activities have not, at reporting date, reached a stage to allow a reasonable assessment regarding the existence of economically recoverable reserves. The ultimate recoupment of costs carried forward for exploration and evaluation phases is dependent on the successful development and commercial exploitation or sale of the respective areas of interest.
All costs carried forward are in respect of areas of interest in the exploration and evaluation phases For personal use only use personal For and accordingly, production has not commenced.
Exploration and evaluation assets shall be assessed for impairment when facts and circumstances suggest that the carrying amount of an exploration and evaluation asset may exceed its
125 PROSPECTUS
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
recoverable amount, in particular when exploration for and evaluation of mineral resource in the specific area have not led to the discovery of commercially viable quantities of mineral resources and the Company has decided to discontinue such activities in the specific area.
(q) Proforma Transactions
i) the write off to the issued capital account of the estimated costs of the Prospectus of $556,350
ii) the issue to a supplier by the Company of 360,000 ordinary shares issued at 5 cents each for settlement of services rendered;
This information is presented under the following two scenarios:
i) $3,000,000 capital raising (minimum subscription). ii) $5,000,000 capital raising (including over subscriptions) – on this basis the total estimated
costs of the Prospectus will increase by $154,500 to $710,850. For personal use only use personal For
126
TORQUE MINING LIMITED NOTES TO THE FINANCIAL STATEMENTS
Note 2 Cash and Cash Equivalents
Proforma Reviewed $3M raising $5M raising
Balance as at 30 November 2012 443,251 443,251 443,251 Issue of shares pursuant to prospectus - 3,000,000 5,000,000 Share issue costs - (477,794) (632,294) 443,251 2,965,457 4,810,957
Note 3 Other Receivables
Balance as at 30 November 2012 20,294 20,294 20,294
Note 4 Exploration and Evaluation Expenditure
Expenditure to 30 November 2012 518,592 518,592 518,592 Acquisition of tenements via share issue 2,000,000 2,000,000 2,000,000 2,518,592 2,518,592 2,518,592
Note 5 Current Trade and Other Payables
Balance as at 30 November 2012 278,303 278,303 278,303 Share issue for settlement of services rendered - (18,000) (18,000) 278,303 260,303 260,303
Note 6 Issued Capital
Balance as at 30 November 2012 3,047,002 3,047,002 3,047,002 Issue of shares pursuant to Prospectus - 3,000,000 5,000,000 Share issue costs - cash (78,556) (556,350) (710,850) Share issue for settlement of services rendered - 18,000 18,000 2,968,446 5,508,652 7,354,152
$3M raising $5M raising Number $ Number $ Movements in number of fully paid ordinary shares since 30 November 2012: Shares on issue at 30 November 2012 60,940,002 3,047,002 60,940,002 3,047,002
Proforma adjustments: Issue of shares pursuant to Prospectus 15,000,000 3,000,000 25,000,000 5,000,000 Share issue costs - cash - (556,350) - (710,850) Share issue for settlement of services rendered 360,000 18,000 360,000 18,000
Proforma Total 76,300,002 5,508,652 86,300,002 7,354,152 For personal use only use personal For
127 PROSPECTUS
6. SOLICITOR’S REPORT ON TENEMENTS
JJB121924
22 January 2013
The Directors Torque Mining Limited 2 Village High Road BENOWA QLD 4217
Dear Sirs
SOLICITOR’S REPORT ON TENEMENTS FOR TORQUE PROSPECTUS
1 SCOPE
(a) You have requested this report to be prepared for inclusion in a prospectus to be issued by Torque Mining Ltd (ABN 54 156 369 336) (Torque).
(b) This report relates to mineral tenements held by Torque in Tasmania including seven exploration licences and one retention licence (Tenements). Details of the Tenements are set out in Annexure A (Tenement Searches) of this report. Two of the seven exploration licences are held jointly by Torque and Exploration & Management Consultants Pty Ltd (ABN 62 052 128 382).
2 SEARCHES
For the purposes of this report:
(a) we have requested searches and made enquires in relation to the Tenements through:
i. searches of the Mining Register maintained in accordance with the Mineral Resources Development Act 1995 (MRDA) and email correspondence from Mineral Resources Tasmania (MRT) which is a division of the Tasmanian Department of Infrastructure, Energy and
Resources (DIER) on 7 January 2013; For personal use only use personal For
ii. ‘desktop assessments’ undertaken by Aboriginal Heritage Tasmania (AHT), which is a division of the Tasmanian Department of Primary Industries, Parks, Water and Environment (DPIPWE), on 13 December
128 - 2 -
2012; and
iii. searches by the National Native Title Tribunal (NNTT) of the registers maintained in accordance with the Native Title Act 1993 (Native Title Act), and otherwise by the NNTT, on 11 September and 17 December 2012.
(b) we have reviewed an email and attachment from MRT dated 24 January 2013 and forwarded to us regarding a dealing registered against the tenement EL20/1996.
3 RESULTS
The key results of the searches and review are summarised in:
(a) Annexure A (Tenement Searches);
(b) Annexure B (Aboriginal Heritage Searches); and
(c) clause 6 (Native Title).
Based on our review of the search results, we consider that this report provides an accurate statement of the status of the Tenements held by Torque in Tasmania in so far as it relates to the subject matter of the searches, as at the date those searches were conducted.
4 TENEMENTS
4.1 Exploration Licences
(a) An exploration licence under the MRDA may only be granted by the Minister for Energy and Resources (Minister) if the Minister is satisfied that the applicant:
i. intends to do work;
ii. intends to comply with the MRDA;
iii. has an appropriate program of work; For personal use only use personal For iv. is likely to have sufficient financial and technical resources to carry out the proposed work;
129 PROSPECTUS
- 3 -
v. has provided sufficient information relating to the likely impact on the environment; and
vi. has provided a security deposit.
(b) An exploration licence may be granted subject to any conditions the Minister considers appropriate. If the licence is held by 2 or more persons, those persons are jointly and severally liable for complying with any conditions on the licence.
(c) If the Minister intends to vary the conditions attached to any licence he must first notify the licensee, which may make submissions in relation to the proposed variation.
(d) The licensee of an exploration licence over private land must not explore in accordance with the licence without the consent of the owner and occupier of the land within 100 metres of the surface of:
i. any natural lake, artificial lake, dam, reservoir, water-producing well or artificial pond; or
ii. any dwelling or substantial building.
The current penalty for breaching this requirement is $13,000.00. Torque advises that the initial activities planned by Torque are not impacted by these provisions.
(e) The area of land comprised in an exploration licence must not include an area which is already a mineral tenement for the same minerals, or is subject to an application for a retention licence or a lease and must not exceed:
i. for category 1 and 5 minerals – 250 square kilometres; and
ii. for category 3 minerals – 500 square kilometres.
(f) An exploration licence authorises the licensee to:
i. explore the licence area for the minerals specified in the licence;
For personal use only use personal For ii. enter and pass over Crown land for that purpose; and
iii. enter and pass over private land for that purpose provided that 14 days written notice is given to the owner or occupier of the land.
130 - 4 -
(g) A person who hinders or obstructs a licensee may be subject to a fine, currently up to $13,000.00.
(h) In accordance with the MRDA, to ‘explore’ means to determine the existence, quality and quantity of minerals for the purpose of commercial exploitation by:
i. conducting geological, geophysical, geobotanical and geochemical surveys;
ii. drilling;
iii. taking samples for analysis or extracting and removing material from land for sampling and testing; or
iv. any other activity approved by the Minister.
(i) Minerals are categorised in the MRDA relevant to the Tenements as follows:
i. category 1 – any metallic mineral and atomic substance (uranium and thorium);
ii. category 3 – means any rock, stone, gravel, sand and clay used in construction, bricks and ceramics; and
iii. category 5 – any industrial mineral, prescribed precious stone and prescribed semi-precious stone.
(j) An exploration licence for category 1 and 3 minerals is in force for 5 years. The MRDA provides no specific term for the duration of exploration licences for category 5 minerals. There is no limit on the number of times a person may apply to the Minister for an extension of the term of an exploration licence. The Minister may grant an application to extend the term of an exploration licence for any period and subject to any conditions the Minister determines. The extension must be granted if the Minister is satisfied that:
i. the exploration to be carried out during the initial or previous terms was completed;
ii. the licensee has complied with specified requirements under the For personal use only use personal For MRDA to submit reports and returns;
iii. the licensee has submitted a suitable work program for the period of extension; and
131 PROSPECTUS
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iv. further detailed exploration is justified on the basis of substantiated results indicating the probability of a discovery leading to profitable mining.
(k) Licensees must:
i. make minimum expenditure each year as determined by the Minister;
ii. submit annual reports to the Director of Mines appointed under the MRDA (Director) specifying amounts expended and details of proposed work and work carried out;
iii. carry out exploration efficiently and effectively; and
iv. carry out exploration and rehabilitation of land consistently with any relevant Code of practice approved by the Director.
(l) A person must not sell any mineral recovered during exploration without the approval of the Director. The current penalty for breaching this requirement is $65,000.00 or revocation of licence or both.
(m) For category 1, 3 and 5 minerals, Rent is payable annually to the Crown by the licensee at the current rate of:
i. $26.136 per square kilometre each year for the first 2 years; and
ii. $52.272 per square kilometre for every subsequent year.
(n) Exploration licences may be varied, transferred, revoked and consolidated in accordance with the provisions of the MRDA.
(o) The licensee or certain persons with an estate or interest in the land subject to an exploration licence may apply to the Mining Tribunal for a review of the following decisions by the Minister in relation to exploration licences:
i. grant of exploration licence;
ii. variation of the exploration licence or conditions attached to an
exploration licence; For personal use only use personal For iii. refusal to extend the term of an exploration licence; and
iv. transfer and revocation of an exploration licence.
132 - 6 -
(p) A licensee may apply to the Director to surrender an Exploration Licence. The Director may grant or refuse to grant the application to surrender.
4.2 Retention Licence
(a) The holder of an exploration licence has an exclusive right to apply for a retention licence over land and minerals subject to that exploration licence, unless the licensee gives express written consent to another applicant. A retention licence may not be granted unless the Minister is satisfied that:
i. the land is likely to be able to be efficiently and effectively mined for specific minerals and there is a sufficient quantity of minerals to justify mining;
ii. it is justified for economic and other reasons not to proceed to mine; and
iii. a security deposit is provided.
(b) The licensee of a retention licence over private land must not explore in accordance with the licence without the consent of the owner and occupier of the land within 100 metres of the surface of:
i. any natural lake, artificial lake, dam, reservoir, water-producing well or artificial pond; or
ii. any dwelling or substantial building.
The current penalty for breaching this requirement is $13,000.00.
(c) A retention licence may be granted subject to any conditions the Minister considers appropriate. The conditions may be varied following notice to the licensee, or rescinded by the Minister.
(d) Rent is payable to the Crown by the licensee at the current rate of $2,469.60 per square kilometre every 12 months for minerals other than coal, petroleum, coal seam gas or geothermal substance.
(e) The area of land comprised in a retention licence for category 1, category 3 For personal use only use personal For and category 5 minerals must not exceed 10 square kilometres.
(f) A retention licence authorises the licensee to evaluate the potential for mining
133 PROSPECTUS
- 7 -
by:
i. geological, geophysical, and geochemical exploration programs;
ii. mining feasibility, environmental, marketing, engineering and design studies;
iii. metallurgical testing; and
iv. entering and passing over Crown land and private land after providing 14 days written notice to the owner or occupier.
(g) A person who hinders or obstructs a licensee may be subject to a fine, currently up to $13,000.00.
(h) A retention licence remains in force for 5 years. The Minister may grant an extension for any period not exceeding 5 years. The MRDA does not specify any circumstances in which a retention licence must be renewed, or limit the number of times that an extension may be applied for.
(i) Licensees must:
i. submit annual reports to the Director specifying amounts expended and details of proposed work and work carried out;
ii. carry out exploration efficiently and effectively; and
iii. carry out exploration and rehabilitation of land consistently with any relevant Code of practice approved by the Director.
(j) A person must not sell any mineral recovered during activities authorised under the license without the approval of the Director. The current penalty for breaching this requirement is $65,000.00 or revocation of licence or both.
(k) For category 1, 3 and 5 minerals, Rent is payable annually to the Crown by the licensee at the current rate of $2,469.60 per square kilometre for each year.
(l) A retention licence may be varied, transferred, revoked and surrendered in
For personal use only use personal For accordance with the provisions of the MRDA.
(m) The licensee or certain persons with an estate or interest in the land subject to a retention licence may apply to the Mining Tribunal for a review of the
134 - 8 -
following decisions by the Minister in relation to retention licences:
i. grant of retention licence;
ii. variation of retention licence or conditions attached to a retention licence;
iii. refusal to extend the term of a retention licence; and
iv. transfer and revocation of retention licence.
4.3 Mining Lease
(a) The Minister may direct the holder of a retention licence to apply for a mining lease, if it is the Minister’s opinion that mining operations should commence. If a mining lease is not applied for as required by the Minister and in accordance with the MRDA, the Minister may revoke the retention licence or amend it to exclude the area the Minister considers should be mined.
(b) The holder of an exploration licence or a retention licence has an exclusive right to mark out and apply for a mining lease with respect to the minerals subject to that licence and for any area within the licence area. Another person may not apply for a mining lease until at least 2 months after the licence expires.
(c) An application for a mining lease must be made within 7 days of marking out the area to be included in the application and be accompanied by (among other things) 6 months rent in advance. The application lapses 12 months after marking out unless before that time it is granted, refused, withdrawn or the time period is extended by the Director of Mines (Director) (where the delay is not caused by the applicant or there is other sufficient reason).
(d) The Director must consider applications for a mining lease. If the Director intends to recommend the granting of an application, the Director must notify the applicant, any holder of a storage lease under the MRDA (if there has been a previous mining lease) and prescribed parties under the Native Title Act 1993 (Cth). If the Director does not recommend the granting of the
application, but it is granted by the Minister, the Minister must provide the For personal use only use personal For notifications described above. The Director must also provide the applicant with a proposed mining lease, for which the applicant has 14 days to make submissions to the Minister about the proposed terms and conditions.
135 PROSPECTUS
- 9 -
(e) The Minister may only grant an application for a mining lease if satisfied that the applicant:
i. has demonstrated that there is sufficient quantity of minerals to justify mining;
ii. intends to mine;
iii. intends to comply with the MRDA;
iv. has an appropriate mining plan;
v. is likely to have sufficient financial and technical resources to carry out the mining plan;
vi. has provided the Director with sufficient information relating to the likely impact on the environment;
vii. if the application is in respect of private land, has entered into a compensation agreement with the owner or occupier of the land (unless the prescribed area is more than 15 meters from the surface of land in the municipality of West Tamar); and
viii. has provided a security deposit.
(f) Within 28 days of marking out, any person with an estate or interest in the land may lodge and objection with the Mining Tribunal to the granting of a mining lease. If the objection is upheld the applicant may amend the application for a lease by excluding the portion of land to which the objection relates.
(g) The Minister may grant a lease for any term and subject to any conditions the Minister considers appropriate. The Minister may vary or rescind those conditions at any time. If the granting is contrary to the recommendation of the Director, any person with and interest or estate in the subject land may object to the Mining Tribunal. If the application for a Mining Lease is refused by the Minister, reasons must be given.
(h) The holder of a mining lease may carry out mining operations in the lease
For personal use only use personal For area for the minerals specified in the lease and for that purpose may enter and pass over Crown land. Mining operations within the lease area may only be undertaken on private land if a compensation agreement is in force with the owner or occupier of that land. A penalty of currently up to $13,000 applies if
136 - 10 -
any person hinders or obstructs a lessee from undertaking the activities authorised by the mining lease.
(i) The owner of occupier of private land, which has on it a dwelling or other substantial building, must give their consent for the holder of a mining lease to explore or mine within 100 metres of the surface of any prescribed body of water or dwelling or substantial building. This requirement is subject to a penalty of currently up to $65,000.00. The responsible government authority must ensure as far as practicable that the holder of a mining lease has sufficient access to water for the purpose of the mining lease.
(j) The holder of a mining lease must submit quarterly returns to the Director containing details of (among other things) the nature quantity and value of minerals obtained and the number of persons employed. The lessee is also required to comply with relevant codes of practice and permit the Director to inspect minerals obtained.
(k) If the requirements of the MRDA are met, a mining lease may be dealt with by way of sub-lease or transfer. The Minister may renew a lease for a term of up to 20 years. There is no limit on the number of times a lessee may apply for the renewal of a mining lease, which must be granted if the Minister is satisfied that (among other things):
i. a mining plan has been submitted for the renewal period;
ii. the MRDA and the conditions of the lease have been complied with; and
iii. a security deposit has been provided.
A mining lease may also be revoked by the Minister or surrendered by the lessee. A lease may be revoked if there has been a contravention of the MRDA or a condition of the lease, or any land in the lease area is required for a public purpose (in which case compensation will be payable to the lessee), or if mining has not taken place for 12 months.
(l) Subject to limited exceptions, rent for a mining lease is payable to the Crown
For personal use only use personal For annually at the prescribed rate. In 2012 to 2013 the rate is $21.79 per hectare or $435.74 (whichever is greater).
137 PROSPECTUS
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(m) When a mineral recovered under a lease is sold, Royalty must be paid quarterly at the prescribed rate to the Minister with respect to Crown Land and to either the Crown or the owner of the mineral with respect to private land. The method of calculating the rate of Royalty varies with respect to the type of mineral sold.
(n) The lessee or certain persons with an estate or interest in the land subject to a lease may apply to the Mining Tribunal for a review of the following matters in relation to mining leases:
i. grant of mining lease;
ii. compensation for unnecessary or unreasonable damage caused during marking out by an applicant for a mining lease;
iii. refusal to grant a renewal of a mining lease; and
iv. revocation of a mining lease.
5 ABORIGINAL HERITAGE
5.1 Aboriginal Relics
(a) The Aboriginal Relics Act 1975 (Tas) (AR Act) provides for the preservation of Aboriginal relics, which include:
i. objects made or created by any of the original inhabitants of Australia or their descendants before 1876;
ii. any object, site or place that bears signs of the activities of the original inhabitants of Australia or their descendants before1876; or
iii. remains of the original inhabitants of Australia or their descendants who died before 1876 and are not interred in legal burial grounds or marked graves in other lands.
(b) The Minister may declare land on which a relic is located as a ‘protected site’. A protected site can only be declared on land that is not Crown land if the
owner and occupier of the land give their written consent. A relic within a For personal use only use personal For protected site is a ‘protected object’. No person may endanger, interfere with or remove a protected object without a permit.
138 - 12 -
(c) The AR Act also prevents people from interfering with a relic, including by destruction and concealment, or from removing a relic from the place where it is found without a permit (among other things). These prohibitions do not apply to any dealing in land.
5.2 Effect of Aboriginal Heritage Sites on Tenements
Where an Aboriginal heritage site is located within or near a Tenement, a permit under the AR Act may be required before further development of the Tenement is undertaken, depending on the nature of that development. This will require an investigation to be undertaken by a consulting Archaeologist to:
(a) identify whether the proposed development of the Tenement, or related infrastructure, will impact on any Aboriginal heritage; and
(b) to offer mitigation advice to prevent a breach of the AR Act.
5.3 Searches
The Aboriginal heritage searches, the results of which are set out in Annexure B (Aboriginal Heritage Searches), are not binding statutory searches and are only evidence of what is on the records of AHT, which are not purported to be a definitive record.
6 NATIVE TITLE
6.1 Native Title
The Native Title Act provides for the recognition and protection of native title, establishes ways in which future dealings affecting native title may proceed in accordance with certain standards and establishes a mechanism for determining claims of native title (among other things).
The NNTT is established under the Native Title Act to make determinations about whether future acts that may affect native title can be undertaken and whether certain agreements concerning native title are covered by the Native Title Act. The NNTT also maintains certain registers relating to native title.
6.2 Native Title Searches For personal use only use personal For NNTT advised on 17 December 2012 that there are no Native Title claims in Tasmania, and on 11 September 2012 there were no relevant entries on the following databases:
139 PROSPECTUS
- 13 -
(a) Schedule of Applications;
(b) Register of Native Title Claims;
(c) National Native Title Register;
(d) Register of Indigenous Land Use Agreements; and
(e) Notified Indigenous Land Use Agreements.
7 ASSUMPTIONS AND OTHER QUALIFICATIONS
(a) In preparing this report we have assumed that the documents and other information, including matters of fact and opinion and relevant assumptions, as provided by third parties including MRT, AHT and NNTT are accurate, not misleading, complete and current as at the date the searches were conducted or other information provided by those third parties. We cannot comment on whether any changes have occurred in respect of the Tenements between the date on which information was provided or the searches were conducted and the date of the prospectus.
(b) We have assumed that the Tenements and any dealings associated with the Tenements have been validly granted and that the relevant Minister and any person exercising delegated authority in relation to the grants have acted within the scope of their powers and discretions.
(c) This report does not cover any third party interests, including encumbrances, in relation to the Tenements that are not apparent from the searches and the information provided to us.
(d) We make no comment and express no opinion on whether the terms and conditions of the Tenements or the MRDA and associated rules and regulations in relation to the tenements have been complied with.
(e) The summaries contained in this report are not intended to be exhaustive summaries of the provisions of any document or other information and therefore should not be relied upon as such. The summaries contained in this
report may not include all matters of interest to a person considering making a For personal use only use personal For decision in relation to the prospectus. No person should act in reliance on any summary without first reviewing the full text of the relevant document that has been summarised.
140 - 14 -
(f) MRT has not released information about compliance issues regarding expenditure, as it is considered commercial in confidence.
(g) The full extent of the jurisdiction of the Mining Tribunal is greater than that addressed in this report.
(h) Our searches have determined that an exploration licence EL3/2011 previously held by Torque has been surrendered and is currently under compliance assessment by MRT to determine if the security may be released. We make no comment and express no opinion regarding any ongoing liabilities or obligations with respect to this exploration licence.
(i) This report presents only a summary of our findings and does not contain detailed legal advice in relation to the issues covered.
8 CONSENT AND DECLARATIONS
This report is given solely for the benefit of Torque and its directors in connection with the issue of the prospectus to which it relates and must not be made available or copied in whole or in part to any other person without the express written consent of Page Seager Lawyers.
Yours faithfully
Justin Hill Partner Ph: (03) 6235 5143 Fax: (03) 6231 0352 Mob: 0418 578 701 E-mail: [email protected]
For personal use only use personal For
141 PROSPECTUS
re no Notes advisesMRT that there no are processes pending Undergoing annual review process following partial surrender advisesMRT that there no are processes pending advisesMRT that there a processes pending advisesMRT that there no are and and Fimiston
)
EMC (
Deposit contributor Frontier Resources Ltd Frontier Resources Ltd Frontier Resources Ltd Frontier Resources Ltd Frontier Resources Ltd
($) Deposit Security Security 100,000.00 10,000.00 12,000.00 18,000.00 27,000.00 Combined
&
1
Date Dealings Registered Granted Partial Sale Joint and Venture 26/05/1998 None None None None
(Sq Km) Area 11 64 210 9 101
date Rent due 12/06/2013 13/09/2013 29/03/2013 03/04/2013 24/11/2013 , for consideration of $65,000.00,effective on 23 March 1998.
etween Exploration & Management Consultants Pty Ltd
2016
Expiry 11/06/2013 12/09/2015 28/03/ 02/04/2016 23/11/2016
ANNEXURE ANNEXURE A agreement b
TENEMENT TENEMENT SEARCHES 09/2010 Grant dateGrant 10/04/1997 13/ 29/03/2011 03/04/2011 24/11/2011
date Application 17/04/1996 24/11/2009 22/10/2010 19/11/2010 03/02/2011 90% 90% interest in the exploration licence
MRT, this dealing relates to an
Category 1 5 1, 5 1, 5 1, 5 1,
obtained obtained from
Status Granted Granted Granted Granted Granted or EMC to sell to or EMC Fimiston a ) f
documents For personal use only use personal For holder Fimiston (
Registered Torque Torque and Exploration & Management Consultants Ltd Pty Torque Torque and Exploration & Management Consultants Ltd Pty Torque Torque
6
According According to
Mining NL
1 Tenement EL20/199 Bay Elliott EL29/2009 Cethana EL33/2010 Wanderer River EL42/2010 LeaRiver EL6/2011 Interview
142
esses esses Notes processes pending advisesMRT that there no are processes pending advisesMRT that there no are processes pending advisesMRT that there no are proc pending
Deposit contributor Frontier Resources Ltd Frontier Resources Ltd Frontier Resources Ltd
($) Deposit Security Security with EL3/2011 10,000.00 15,000.00 15,000.00
&
Date Dealings Registered None None None
(Sq Km) Area 144 100 3
date Rent due 05/12/2013 23/11/2013 13/05/2013
-
16 Expiry - 04/12/2016 22/11/2016 12/05/2013
Grant dateGrant 05/12/2011 23/11/2011 12/05/2006
date Application 15/04/2011 13/05/2011 26/10/2005
Category 1, 5 1, 5 1, 5 1,
Status Granted Granted Granted
For personal use only use personal For holder rque Registered To Torque Torque
Tenement River EL21/2011 Pieman River EL27/2011 Paris Mt RL3/2005 Narrawa Creek (2.5km east Moina) of
143 PROSPECTUS
ANNEXURE B
ABORIGINAL HERITAGE SEARCHES
Tenement Registered Holder Relic Sites within Tenement Relic sites outside but near area Tenement area EL20/1996 Torque and Exploration & No sites recorded 50+ sites recorded within 2km Management Consultants Pty Elliott Bay Ltd EL29/2009 Torque 12 sites recorded -
Cethana EL33/2010 Torque and Exploration & No sites recorded 50+ sites recorded within Management Consultants Pty 2.5km Wanderer River Ltd EL42/2010 Torque 2 sites recorded -
River Lea EL3/2011 Torque 38 sites recorded -
Tonganah EL6/2011 Torque No sites recorded 10+ sites recorded within 1km
Interview Review EL21/2011 Torque 5 sites recorded 50+ sites recorded within 300m Pieman River EL27/2011 Torque No sites recorded -
Mt. Paris RL3/2005 Torque No sites recorded 6 sites recorded within 1.5km
Narrawa Creek
For personal use only use personal For
144 7. MATERIAL CONTRACTS
Set out below are summaries of the more important provisions of contracts to which the Company is a party and which are or may be material in terms of the Offer or the operations of the Company or otherwise are or may be relevant to an investor who is contemplating the Offer.
To fully understand all rights and obligations in the material contracts it is necessary to read them in full. A copy of each of these contracts may be inspected during normal business hours at the registered office of the Company.
7.1 Agreements affecting the Tenements
Frontier Joint Venture The Company is party to an unincorporated joint venture with Frontier in respect of retention licence 3/2005 and exploration licences 42/2010, 29/2009, 27/2011, 6/2011 and 21/2011.
The participating interests in the joint venture are: the Company (90%) and Frontier (10%).
The Company will manage the Frontier Joint Venture and sole fund expenditure up to the completion of a bankable feasibility study with all activities, works and programs to be determined at its sole discretion.
Within 30 days of completion of a bankable feasibility study, the parties must notify the other of their election to contribute to future expenditure on a pro-rata basis, dilute its interest or withdraw from the joint venture.
Following completion of a bankable feasibility study, the parties intend to prepare a formal joint venture agreement that is on industry standard terms other than as agreed between the parties.
Exploration & Management Consultants Joint Venture The Company is party to a joint venture with Exploration & Management Consultants Pty Ltd (ACN 052 128 382) (EMC) in respect of exploration licences 20/1996 and 33/2010.
EMC is a related party of the Company by virtue of being an entity controlled by Mr Peter McNeil, Chairman.
The participating interests in the joint venture are: the Company (90%) and EMC (10%).
The Company will manage the EMC Joint Venture and sole fund expenditure up to the completion of a bankable feasibility study, including an obligation to satisfy the minimum annual expenditure and work commitments, required by Minerals Resources Tasmania, with all activities, works and programs to be determined at its sole discretion.
Following completion of a bankable feasibility study and a decision to proceed to development, the parties must contribute to future expenditure on a pro-rata basis.
Upon commencing a bankable feasibility study, the parties intend to prepare a formal operating agreement that is consistent with the terms of the EMC Joint Venture agreement and otherwise on industry standard terms other than as agreed between the parties.
7.2 Agreements with related parties A summary of each of the agreements with related parties of the Company is set out in the “Investment Overview” Section of this Prospectus.
7.3 Agreement with BCD Resources NL for Processing of Stormont Gold Deposit
For personal use only use personal For A summary of the main terms of this agreement is set out in Section 2.3 of this Prospectus.
7.4 Other Material Contracts
Sponsoring Broker Agreement A summary of the main terms of this agreement is set out in Section 1.6 of this Prospectus.
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8 ADDITIONAL INFORMATION
8.1 Tax Status and Financial Year The Company is taxed in Australia as a public company. The financial year of the Company ends on 30 June annually.
8.2 Corporate Governance The Board of Directors of the Company will be responsible for the corporate governance of the Company including its strategic development. The format of this Section is guided by the ASX Corporate Governance Council’s principles and recommendations. The Company’s corporate governance principles and policies are therefore structured as follows:
Principle 1 Lay solid foundations for management and oversight Principle 2 Structure the Board to add value Principle 3 Promote ethical and responsible decision making Principle 4 Safeguard integrity in financial reporting Principle 5 Make timely and balanced disclosure Principle 6 Respect the rights of Shareholders Principle 7 Recognise and manage risk Principle 8 Remunerate fairly and responsibly
8.2(a) Board Responsibilities The Board will be accountable to the Shareholders for the performance of the Company and will have overall responsibility for its operations. Day to day management of the Company’s affairs, and the implementation of the corporate strategy and policy initiatives, will be formally managed by the Directors of the Company.
The key responsibilities of the Board will include:
• approving the strategic direction and related objectives of the Company and monitoring management performance in the achievement of these objectives;
• adopting budgets and monitoring the financial performance of the Company;
• overseeing the establishment and maintenance of adequate internal controls and effective monitoring systems;
• overseeing the implementation and management of effective safety and environmental performance systems;
• ensuring all major business risks are identified and effectively managed; and
• ensuring that the Company meets its legal and statutory obligations.
For the purposes of the proper performance of their duties, the Directors are entitled to seek independent professional advice at the Company’s expense, unless the Board determines otherwise. The Board schedules meetings on a regular basis and other meetings as and when required.
8.2(b) Size and Composition of the Board The Directors consider the size and composition of the Board is appropriate given the size and status of the Company. However, the composition of the Board will be subject to review in a number of ways.
• The Constitution provides that at every annual general meeting, one third of the Directors shall retire from office but may stand For personal use only use personal For for re-election.
• Board composition will be also reviewed periodically either when a vacancy arises or if it is considered the Board would benefit from the services of a new director, given the existing mix of skills and experience of the Board, which should match the strategic demands of the Company. Once it has been agreed that a new director is to be appointed, a search will be undertaken, sometimes using the services of external consultants. Nominations would then be received and reviewed by the Board.
146 8.2(c) Ethics and Independence The Board recognises the need for Directors and employees to observe the highest standards of behaviour and business ethics when engaging in corporate activity. The Company intends to maintain a reputation for integrity. The Company’s officers and employees are required to act in accordance with the law and with the highest ethical standards.
The Board is conscious of the need for independence and ensures that where a conflict of interest may arise, the relevant Director(s) leave the meeting to ensure a full and frank discussion of the matter(s) under consideration by the rest of the Board. Those Directors who have interests in specific transactions or potential transactions do not receive Board papers related to those transactions or potential transactions, do not participate in any part of a Directors’ meeting which considers those transactions or potential transactions, are not involved in the decision making process in respect of those transactions or potential transactions, and are asked not to discuss those transactions or potential transactions with other Directors.
Corporate Governance Council Recommendation 2.1 requires a majority of the Board to be independent directors. In addition, Recommendation 2.2 requires the chairperson of the Company to be independent. The Corporate Governance Council defines independence as being free from any business or other relationship that could materially interfere with, or could reasonably be perceived to materially interfere with, the exercise of unfettered and independent judgement. In accordance with this definition, one Director, Mr Graham Fish, is considered to be independent.
The Company considers industry experience and specific expertise to be important attributes of its Board members and therefore believes that the composition of the Board is appropriate given the size and development of the Company at the present time.
8.2(d) Board Committees It is the role of the Board to oversee the management of the Company and it may establish appropriate committees to assist in this role. The composition of the committees shall be as follows:
• the committees will initially consist of all members of the Board;
• each committee will have a charter approved by the Board; and
• each committee will maintain minutes of each meeting of the committee, which will be circulated to all Directors.
The Board will initially establish an audit, risk and compliance committee. At the present time no other committees will be established because of the size of the Company and the involvement of the Board in the operations of the Company. The Board takes ultimate responsibility for the operations of the Company including remuneration of Directors and executives and nominations to the Board.
Audit, Risk and Compliance Committee The audit committee will initially be comprised of the Board. The Board will annually confirm the membership of the committee.
The committee’s primary responsibilities are to:
• oversee the existence and maintenance of internal controls and accounting systems;
• oversee the management of risk within the Company;
• oversee the financial reporting process;
• review the annual and half-year financial reports and recommend them for approval by the Board of Directors;
• nominate external auditors;
• review the performance of the external auditors and existing audit arrangements; and
• ensure compliance with laws, regulations and other statutory or professional requirements, and the Company’s governance
For personal use only use personal For policies.
The Chief Financial Officer, Ms Lisa Hartin, will provide accounting and financial support to the Company. Ms Hartin will be required to state in writing to the Board that the Company’s financial reports present a true and fair view, in all material respects, of the Company’s financial condition and operational results are in accordance with relevant accounting standards. Included in this statement will be confirmation that the Company’s risk management and internal controls are operating efficiently and effectively.
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8.2(e) Shareholder Communication The Board strives to ensure that Shareholders are provided with sufficient information to assess the performance of the Company and its Directors and to make well-informed investment decisions. Information is communicated to Shareholders through:
• annual and half-yearly financial reports and quarterly reports;
• annual and other general meetings convened for Shareholder review and approval of Board proposals;
• continuous disclosure of material changes to ASX for open access to the public; and
• the Company maintains a website where all ASX announcements, notices and financial reports are published as soon as possible after release to ASX.
The auditor is invited to attend the annual general meeting of Shareholders. The Chairman will permit Shareholders to ask questions about the conduct of the audit and the preparation and content of the audit report.
8.2(f) Identification and Management of Business Risk The Board has identified the significant areas of potential business and legal risk of the Company. The identification, monitoring and, where appropriate, the reduction of significant risk to the Company will be the responsibility of the Board.
The Board reviews and monitors the parameters under which such risks will be managed. Management accounts will be prepared and reviewed at subsequent Board meetings. Budgets are prepared and compared against actual results.
8.2(g) Remuneration The Chairman and the Directors are entitled to draw Directors’ fees and receive reimbursement of reasonable expenses for attendance at meetings. The Company is required to disclose in its annual report details of remuneration to Directors. The maximum aggregate annual remuneration which may be paid to non-executive Directors is $310,000. This amount cannot be increased without the approval of the Company’s shareholders. A detailed explanation of the basis and quantum of Directors remuneration is set out in Section 8.7 of this Prospectus.
8.2(h) Securities Trading Disclosure The Company has a formal policy for dealing in the Company’s securities by Directors, employees and contractors. This sets out their obligations regarding disclosure of dealing in the Company’s securities. The Constitution permits Directors to acquire securities in the Company, however Company policy prohibits Directors and senior management from dealing the Company’s securities at any time whilst in possession of price sensitive information and for 7 days prior and 2 days after:
• any major announcements;
• the release of the Company’s annual and half yearly financial results to the ASX; and
• the annual general meeting.
Directors must advise the Chairman of the Board before buying or selling securities in the Company. All such transactions are reported to the Board. In accordance with the provisions of the Corporations Act and the Listing Rules, the Company advises ASX of any transaction conducted by Directors in the securities of the Company.
8.2(i) Departures from Recommendations Following admission to the Official List of ASX, the Company will be required to report any departures from the Recommendations in its annual financial report.
With the exception of the departures from the Corporate Governance Council recommendations in relation to the composition of
the Board (Recommendations 2.1 and 2.2), establishment of a nomination committee (Recommendation 2.4), composition of the For personal use only use personal For audit committee (Recommendation 4.2) and the establishment and composition of a remuneration committee (Recommendations 8.1 and 8.2), the corporate governance practices of the Company are compliant with the Recommendations.
The Company’s compliance and departures from the Recommendations as at the date of this Prospectus are set out on the following pages.
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COMMENT which discloses the specific Charter, Corporate Governance Plan includes a Board The Company’s of the Board. responsibilities for the performance of Company and will have overall will be accountable to the Shareholders The Board and the implementation of affairs, for its operations. Day to day management of the Company’s responsibility corporate strategy and policy initiatives, will be formally managed by the Managing Director. Corporate Governance Plan includes a section on performance evaluation practices adopted by The Company’s the Company. not will monitor the performance of any senior executives who are and the Board The chair will monitor the Board including measuring actual performance against planned performance. directors, set out above. The Company will also Recommendations 1.1 and 1.2 (if any) are from Explanation of departures annual reports. Recommendations 1.1 and 1.2 (if any) in its future from explain any departures has been appointed. No performance evaluation of senior executives taken place to date Managing Director is conducted annually and the first year has not been completed. as the process will disclose whether such a performance evaluation has taken place in the relevant annual reports Future disclosed. with the process period and whether it was in accordance reporting website. is posted on the Company’s Charter, The Corporate Governance Plan, which includes the Board is one There non-executive directors. and three composed of one executive director is currently The Board of a The Company is at an early stage and size it not feasible to have a board independent director. and counter productive. as it would be cost prohibitive majority of independent directors The chairman, Mr Peter McNeil, has considerable experience with the The chair is not an independent director. person to act as chair of and it was believed that Mr Peter McNeil the most appropriate projects Tasmanian the Company. The Company does not combine these roles. as a whole, currently No formal nomination committee has been established by the Company as yet. The Board, serves as the nomination committee. which discloses the Corporate Governance Plan includes a Nomination Committee Charter, The Company’s responsibilities of the committee. specific seeks advice of external advisers in connection with the suitability of applicants for the Board necessary, Where membership. Board For personal use only use personal For Principles and RECOMMENDATIONs Lay solid foundations for management and oversight to Companies should establish the functions reserved and those delegated to senior executives the board and disclose those functions. for evaluating Companies should disclose the process the performance of senior executives. the information indicated Companies should provide in the Guide to reporting on Principle 1 . Structure the board to add value should be independent A majority of the board directors. The chair should be an independent director. of chair and chief executive officer should The roles by the same individual. not be exercised should establish a nomination committee. The board 1. 1.1 1.2 1.3 2. 2.1 2.2 2.3 2.4
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The Company’s Corporate Governance Plan includes a section on performance evaluation practices adopted by The Company’s the Company. and the other its committees (if any) and individual directors the performance of Board, The chair will review that the Company continues to have a mix the performance of chair to ensure will together review Directors of skills and experience necessary for the conduct its activities. to their such as their skills, experience and expertise relevant details of each director, The Company has provided annual reports. these details on its website and in future and will also provide position in this Prospectus set out above. The Recommendations 2.1, 2.2, 2.3, 2.4 and 2.5 (if any) are from Explanation of departures Recommendations 2.1, 2.2, 2.3, 2.4 and 2.5 (if any) in its future from Company will also explain any departures annual reports. As the operations of Company The Company has appointed a Chief Executive Officer/Managing Director. and other senior management. the need for additional executive directors will reassess develop the Board has taken place to date as this its committees and individual directors No performance evaluation of the Board, reports will disclose annual is conducted annually and the first year has not been completed. Future process period and whether it was in reporting whether such a performance evaluation has taken place in the relevant disclosed. with the process accordance is posted on the The Corporate Governance Plan, which includes the Nomination Committee Charter, website. Company’s a Corporate Governance Plan includes a ‘Corporate Code of Conduct’ , which provides The Company’s to ethical conduct in employment. framework for decisions and actions in relation a framework for Corporate Governance Plan includes a ‘Diversity Policy’ , which provides The Company’s to assess annually both the objectives for achieving gender diversity and the Board establishing measureable in achieving them. objectives and progress For personal use only use personal For the practices necessary to maintain confidence in integrity the company’s the practices necessary to take into account their expectations of legal obligations and the reasonable their stakeholders and accountability of individuals the responsibility of unethical and investigating reports for reporting practices. Companies should provide the information indicated Companies should provide in the Guide to reporting on Principle 2 . Promote ethical and responsible decision-making Companies should establish a code of conduct and disclose the code or a summary of as to: · · · Companies should establish a policy concerning diversity and disclose the policy or a summary of The policy should include requirements that policy. objectives for to establish measureable for the board to assess achieving gender diversity and for the board in achieving annually both the objectives and progress them. Companies should disclose the process for evaluating Companies should disclose the process its committees and the performance of board, individual directors. 2.6 3. 3.1 3.2 2.5
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This disclosure has not yet been made as the first year has not been completed. Future annual reports will annual has not yet been made as the first year completed. Future This disclosure with the in accordance objectives for achieving gender diversity set by the board disclose the measureable in achieving them. diversity policy and progress reports will annual has not yet been made as the first year completed. Future This disclosure of women employees in the whole organisation, senior executive positions and disclose the proportion women on the board. set out above. The Company Recommendations 3.1, 3.2, 3.3 and 3.4 (if any) are from Explanation of departures annual reports. Recommendations 3.1, 3.2, 3.3 and 3.4 (if any) in its future from will also explain any departures is posted The Corporate Governance Plan, which includes the Corporate Code of Conduct and Diversity Policy, website. on the Company’s serves as the audit committee and considers issues that would otherwise as a whole, currently The Board, by an audit committee while following the guidelines set out in Audit and Risk Committee be considered Corporate Governance Plan. Charter of the Company’s and only one independent director. The Audit committee has 4 members but includes one executive director Graham Fish is the Chairman of committee is sufficient to of the persons on Board is of the view that experience and professionalism The Board and actioned. addressed appropriately that all significant matters are ensure will reassess changes the Board As the operations of Company develop and composition Board the formation of audit committee. which discloses its Corporate Governance Plan includes an Audit and Risk Committee Charter, The Company’s responsibilities. specific set out above. The Company will Recommendations 4.1, 4.2 and 4.3 (if any) are from Explanation of departures annual reports. Recommendations 4.1, 4.2 and 4.3 (if any) in its future from also explain any departures is posted on the The Corporate Governance Plan, which includes the Audit & Risk Committee Charter, website. Company’s the compliance with ASX Listing in place designed to ensure program The Company has a continuous disclosure of accountability at a senior executive level for compliance and factual presentation and to ensure Rule disclosure financial position. the Company’s an explanation Recommendation 5.1. The Company will provide departed from The Company has not currently annual reports. Recommendation 5.1 (if any) in its future from of any departures is posted on the Company’s program, The Corporate Governance Plan, which includes a continuous disclosure website. For personal use only use personal For consists only of non-executive directors consists of a majority independent directors who is not chair by an independent chair, is chaired of the board members. has at least three Companies should disclose in each annual report Companies should disclose in each annual report of women employees in the whole the proportion organisation, women in senior executive positions and women on the board. the information indicated Companies should provide in the Guide to reporting on Principle 3 . Safeguard integrity in financial reporting should establish an audit committee. The board so that it: The audit committee should be structured · · · · The audit committee should have a formal charter. the information indicated Companies should provide in the Guide to reporting on Principle 4 . Make timely and balanced disclosure Companies should establish written policies designed compliance with ASX Listing Rule disclosure to ensure accountability at a senior and to ensure requirements executive level for that compliance and disclose those policies or a summary of those policies. the information indicated Companies should provide in Guide to Reporting on Principle 5. Companies should disclose in each annual report the Companies should disclose in each annual report objectives for achieving gender diversity measureable with the diversity in accordance set by the board in achieving them. policy and progress 3.4 3.5 4. 4.1 4.2 4.3 4.4 5. 5.1 5.2 3.3
151 PROSPECTUS
The Company’s Corporate Governance Plan includes a shareholders communication strategy, which aims to communication strategy, Corporate Governance Plan includes a shareholders The Company’s state of affairs. the Company’s informed of all major developments affecting are that the shareholders ensure an explanation Recommendation 6.1. The Company will provide departed from The Company has not currently annual reports. Recommendation 6.1 (if any) in its future from of any departures will be posted on the communication strategy, The Corporate Governance Plan, which includes a shareholders website. Company’s Corporate Governance Plan includes a risk management policy. The Company’s risk responsible for overseeing and approving and is “risk profile” determines the Company’s The Board management strategy and policies, internal compliance and internal control. Corporate Governance Plan includes a risk management policy. The Company’s time. at the relevant a report to provide the Managing Director will require The Board and chief financial officer. the Managing Director assurance from has received The board Recommendations 7.1, 7.2 and 7.3. The Company will provide departed from The Company has not currently annual reports. Recommendations 7.1, 7.2 and 7.3 (if any) in its future from an explanation of any departures website. is posted on the Company’s The Corporate Governance Plan, which includes a risk management policy, For personal use only use personal For Companies should provide the information indicated Companies should provide in the Guide to reporting on Principle 6 . Recognise and manage risk Companies should establish policies for the oversight and management of material business risks disclose a summary of those policies. management to design and should require The board implement the risk management and internal control material business system to manage the company’s being to it on whether those risks are risks and report should disclose that The board managed effectively. to it as the effectiveness management has reported management of its material of the company’s business risks. should disclose whether it has received The board the chief executive officer (or assurance from equivalent) and the chief financial officer (or with in accordance that the declaration provided section 295A of the Corporations Act is founded on a sound system of risk management and internal in and that the system is operating effectively control reporting to financial in relation all material respects risks. the information indicated Companies should provide in Guide to Reporting on Principle 7. Respect the rights of shareholders Companies should design a communications communication with effective policy for promoting and encouraging their participation shareholders at general meetings and disclose their policy or a summary of that policy. 6.2 7. 7.1 7.2 7.3 7.4 6.1 6.
152
The Board has not established a formal remuneration committee at this point in the Company’s development. It is committee at this point in the Company’s has not established a formal remuneration The Board this impractical and along with the level of activity Company renders that the size of Board considered serves as a currently participating in the decision making process, director acting without the affected the Board, committee. remuneration which discloses its Corporate Governance Plan includes a Remuneration Committee Charter, The Company’s responsibilities. specific with the fees only, is by way of director other than the managing director, directors, Remuneration to the current to an amount it considers be commensurate for a company level of such fees, having been set by the Board of its size and level activity. to re- it is the intention of Board however, no link between performance and remuneration, is currently There benefits in no schemes for retirement are assess this once the Company commences operations. Further there existence. serves as the currently committee has been established, the Board Although no formal remuneration Mr Fish, the committee which has 4 members but includes only one independent director. remuneration committee will chair the remuneration independent director does not consider that the Company is of sufficient size to justify appointment additional The Board and as it would be cost prohibitive for the sole purpose of satisfying this recommendation directors counterproductive. will reassess changes the Board As the operations of Company develop and composition Board committee. the formation of remuneration than will be not more of non-executive Directors that the remuneration constitution provides The Company’s resolution at a general meeting of fixed sum set by the constitution and subsequently varied the aggregate shareholders. and senior executives of executive directors for determining the remuneration will be responsible The Board maximum stakeholder objective to provide It is the Board’s director). (without the participation of affected and remunerating executive directors and executive team by retention of a high quality Board the benefit from employment market conditions and by linking to relevant with reference senior executives fairly and appropriately financial and and senior executives emoluments to the Company’s and amount of executive directors’ the nature operational performance. set out above. The Company will Recommendations 8.1, 8.2 and 8.3 (if any) are from Explanation of departures annual Recommendations 8.1, 8.2 and 8.3 (if any) in its future from an explanation of any departures also provide reports. is posted on the The Corporate Governance Plan, which includes the Remuneration Committee Charter, website. Company’s For personal use only use personal For consists of a majority independent directors by an independent director is chaired members has at least three The remuneration committee should be structured so committee should be structured The remuneration that it: · · · Companies should clearly distinguish the structure that of from remuneration of non-executive directors’ and senior executives. executive directors the information indicated Companies should provide in the Guide to reporting on Principle 8 . Remunerate fairly and responsibly should establish a remuneration The board committee. 8.2 8.3 8.4 8.1 8.
153 PROSPECTUS
8.3 Litigation The Directors are not aware of any legal proceedings which have been threatened or actually commenced against the Company.
8.4 Rights Attaching To Shares The Shares to be issued under this Prospectus will rank equally with the issued fully paid ordinary Shares in the Company. The rights attaching to Shares are set out in the Company’s Constitution and, in certain circumstances, are regulated by the Corporations Act, the Listing Rules and general law.
Shares The following is a summary of the more significant rights of the holders of Shares. This summary is not exhaustive nor does it constitute a definitive statement of the rights and liabilities attaching to Shares:
• General Meeting
Each member is entitled to receive notice of, and to attend and vote at, general meetings of the Company and to receive all notices, accounts and other documents required to be sent to members under the Company’s Constitution, the Corporations Act or the Listing Rules.
• Voting
Subject to any rights or restrictions for the time being attached to any class or classes of Shares whether by the terms of their issue, the Constitution, the Corporations Act or the Listing Rules, at a general meeting of the Company every holder of fully paid ordinary Shares present in person or by a representative has one vote on a show of hands and every such holder present in person or by a representative, proxy or attorney has one vote per share on a poll. A person who holds an ordinary share which is not fully paid is entitled, on a poll, to a fraction of a vote equal to the proportion which the amount paid bears to the total issue price of the Share. A member is not entitled to vote unless all calls and other sums presently payable by the member in respect of Shares in the Company have been paid. Where there are two or more joint holders of the Share and more than one of them is present at a meeting and tenders a vote in respect of the Share (whether in person or by proxy or attorney), the Company will count only the vote cast by the member whose name appears before the other(s) in the Company’s register of members.
• Issues of Further Shares
The Directors may, on behalf of the Company, issue, grant options over or otherwise dispose of unissued Shares to any person on the terms, with the rights, and at the times that the Directors decide. However, the Directors must act in accordance with the restrictions imposed by the Company’s Constitution, the Listing Rules, the Corporations Act and any rights for the time being attached to the Shares in special classes of Shares.
• Variation of Rights
At present, the Company has on issue one class of Shares only, namely ordinary Shares. The rights attached to the Shares in any class may be altered only by a special resolution of the Company and a special resolution passed at a separate meeting of the holders of the issued Shares of the affected class, or with the written consent of the holders of at least three quarters of the issued Shares of the affected class.
• Transfer of Shares
Subject to the Company’s Constitution, the Corporations Act, the ASX Settlement Business Rules and the Listing Rules, ordinary Shares are freely transferable.
The Shares may be transferred by a proper transfer effected in accordance with ASX Settlement Business Rules, by any other method of transferring or dealing introduced by ASX and as otherwise permitted by the Corporations Act or by a written For personal use only use personal For instrument of transfer in any usual form or in any other form approved by the Directors that is permitted by the Corporations Act. The Company may decline to register a transfer of Shares in the circumstances described in the Company’s Constitution and where permitted to do so under the Listing Rules. If the Company declines to register a transfer, the Company must, within five business days after the transfer is lodged with the Company, give the lodging party written notice of the refusal and the reasons for refusal. The Directors must decline to register a transfer of Shares when required by law, by the Listing Rules or by the ASX Settlement Business Rules.
154 • Dividends
The Company in general meeting may declare a dividend if the Directors have recommended a dividend, and a dividend shall not exceed the amount recommended by the Directors. The Directors may authorise the payment to the members of such interim dividends as appear to the Directors to be justified by the Company’s profits and for that purpose may declare such interim dividends.
Subject to the rights of members entitled to Shares with special rights as to dividend (if any), all dividends in respect of Shares (including ordinary Shares) are to be declared and paid proportionally to the amount paid up or credited as paid up on the Shares.
• Winding Up
Subject to the rights of holders of Shares with special rights in a winding up, if the Company is wound up, members (including holders of ordinary Shares) will be entitled to participate in any surplus assets of the Company in proportion to the Shares held by them respectively irrespective of the amount paid up or credited as paid up on the Shares.
8.5 Terms and Conditions of Options
8.5 a Director Options As at the date of this Prospectus, the Company has granted 4,000,000 Options to Directors on the following terms and conditions:
The options held by the Optionholder are exercisable in whole or in part on or before 3 years from date of listing (“Exercise Period”). Options not exercised before the expiry of the Exercise Period will lapse.
Options are exercisable by notice in writing to the Board delivered to the registered office of the Company and payment of the exercise price of $0.30 per option in cleared funds.
The Company will not apply for official quotation on ASX of the Options. An application may be lodged at a later date to list the options in the sole discretion of the Board of the Company should the Board considers that there is sufficient spread of option holders to result in a market for the options on ASX.
The Company will make application for official quotation on ASX of new shares allotted on exercise of the Options. Those Shares will participate equally in all respects with existing issued ordinary shares, and in particular new shares allotted on exercise of the options will qualify for dividends declared after the date of their allotment.
Options are not transferable, except that if at any time before expiry of the Exercise Period the Optionholder dies, the legal personal representative of the deceased Optionholder may:
• elect to be registered as the new holder of the options,
• whether or not he becomes so registered, exercise those options in accordance with the terms and conditions on which they were granted, and
• if the deceased has already exercised options, pay the exercise price in respect of those options.
An Optionholder may only participate in new issues of securities to holders of ordinary shares in the Company if the option has been exercised and shares allotted in respect of the option before the record date for determining entitlements to the issue.
If there is a bonus issue to the holders of ordinary shares in the capital of the Company, the number of ordinary shares over which the option is exercisable will be increased by the number of ordinary shares which the holder of the option would have received if the option had been exercised before the record date for the bonus issue.
For personal use only use personal For If the Company makes a rights issue (other than a bonus issue), the exercise price of options on issue will not change.
If, during the currency of the options the issued capital of the Company is reorganised, those options will be reorganised to the extent necessary to comply with ASX Listing Rules and the Corporations Act at the time of reorganisation.
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8.5 b Listed Options (a) Entitlement Subject to paragraph (m), each Option entitles the holder to subscribe for one Share upon exercise of the Option.
(b) Exercise Price Subject to paragraph (j), the amount payable upon exercise of each Option will be $0.30 (Exercise Price).
(c) Expiry Date Each Option will expire at 5.00pm (WST) on 31 March 2016 (Expiry Date). An Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.
(d) Exercise Period The Options are exercisable at any time on or prior to the Expiry Date (Exercise Period).
(e) Notice of Exercise The Options may be exercised during the Exercise Period by notice in writing to the Company in the manner specified on the Option certificate Notice( of Exercise) and payment of the Exercise Price for each Option being exercised in Australian currency by electronic funds transfer or other means of payment acceptable to the Company.
(f) Exercise Date A Notice of Exercise is only effective on and from the later of the date of receipt of the Notice of Exercise and the date of receipt of the payment of the Exercise Price for each Option being exercised in cleared funds (Exercise Date).
(g) Timing of issue of Shares on exercise Within 15 Business Days after the later of the following:
(i) the Exercise Date; and
(ii) when excluded information in respect to the Company (as defined in section 708A(7) of the Corporations Act) (if any) ceases to be excluded information, but in any case no later than 20 Business Days after the Exercise Date, the Company will:
(iii) allot and issue the number of Shares required under these terms and conditions in respect of the number of Options specified in the Notice of Exercise and for which cleared funds have been received by the Company;
(iv) if required, give ASX a notice that complies with section 708A(5)(e) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors; and
(v) if admitted to the official list of ASX at the time, apply for official quotation on ASX of Shares issued pursuant to the exercise of the Options.
If a notice delivered under (g)(iv) for any reason is not effective to ensure that an offer for sale of the Shares does not require disclosure to investors, the Company must, no later than 20 Business Days after becoming aware of such notice being ineffective, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors.
(h) Shares issued on exercise
Shares issued on exercise of the Options rank equally with the then issued shares of the Company. For personal use only use personal For (i) Quotation of Shares issued on exercise If admitted to the official list of ASX at the time, application will be made by the Company to ASX for quotation of the Shares issued upon the exercise of the Options.
(j) Reconstruction of capital If at any time the issued capital of the Company is reconstructed, all rights of an Optionholder are to be changed in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reconstruction.
156 (k) Participation in new issues There are no participation rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Options without exercising the Options.
(l) Adjustment for pro rata issue (except a bonus issue) In the event the Company proceeds with a pro rata issue (except a bonus issue) of securities to Shareholders after the date of issue of the Options, an Option does not confer the right to a change in Exercise Price.
(m) Adjustment for bonus issue If the Company makes a bonus issue of Shares to existing Shareholders (other than an issue in lieu or in satisfaction of dividends or by way of dividend reinvestment):
(i) the number of Shares which must be issued on the exercise of an Option will be increased by the number of Shares which the Optionholder would have received if the Optionholder had exercised the Option before the record date for the bonus issue; and
(ii) no change will be made to the Exercise Price
(n) Quoted The Company propose to apply for quotation of the Options on ASX.
(o) Transferability The Options are transferable subject to any restriction or escrow arrangements imposed by ASX or under applicable Australian securities laws.
8.6 Employee Share Option Scheme The Company has established an employee incentive Option scheme (“Scheme”). The Scheme is designed to provide eligible participants with an ownership interest in the Company and to provide additional incentives for eligible participants to increase profitability and returns to Shareholders.
The summary of the Scheme is set out below for the information of potential investors in the Company. The detailed terms and conditions of the Scheme may be obtained free of charge by contacting the Company.
General The Board may from time to time, in its absolute discretion, offer to grant options to eligible participants under the Scheme.
Each Option will be issued for no consideration and will carry the right in favour of the Optionholder to subscribe for one (1) Share in the capital of the Company.
The Board may determine the exercise price of the options in its absolute discretion provided the exercise price shall not be less than the weighted average of the last sale price of the Company’s Shares on ASX at the close of business on each of the five business days immediately preceding the date on which the Directors resolve to grant the options.
Eligible Participants Full time employees, part time employees of the Company or an associated body corporate (the “Group”) are eligible to participate in the Scheme.
Lapse of Options Unless the Board in its absolute discretion determines otherwise, options shall lapse immediately on:
(a) the expiry of the exercise period; For personal use only use personal For
(b) the Optionholder ceasing to be within the category of eligible participant by reason of dismissal, resignation or termination of employment, office or services for any reason, except the Directors may resolve within 30 days of such dismissal, resignation or termination, that the Options shall lapse on other terms they consider appropriate;
157 PROSPECTUS
(c) the expiry of 1 year after the Optionholder ceases to be within the category of eligible participant by reason of retirement; and
(d) a determination by the Directors that the Optionholder has acted fraudulently, dishonestly or in breach of his or her obligations to the Company or an associated body corporate.
Participation in Future Issues There are no participating rights or entitlements inherent in the options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the options. However, the Company will ensure that for the purposes of determining entitlements to any such issue, the record date will be at least 7 business days after the issue is announced. This will give optionholders the opportunity to exercise their options prior to the date for determining entitlements to participate in any such issue.
If the Company makes a pro rata issue of securities (except a bonus issue) to the holders of Shares (other than an issue in lieu or in satisfaction of dividends or by way of dividend reinvestment) the exercise price of the options shall be reduced in accordance with the formula in ASX Listing Rule 6.22.2.
In the event of a bonus issue of Shares being made prorata to Shareholders (other than an issue in lieu of dividends), the number of Shares issued on exercise of each Option will include the number of bonus Shares that would have been issued if the Option had been exercised prior to the record date for the bonus issue. No adjustment will be made to the exercise price per Option.
Reorganisation The terms upon which options will be granted will not prevent them being reorganised as required by the Listing Rules on the reorganisation of the capital of the Company.
Trigger Events Upon the occurrence of certain trigger events (for example the receipt by the Company of a bidder’s statement in respect of the Company), the Directors may determine:
(a) that the options may be exercised at any time from the date of such determination, and in any number until the date determined by the Directors acting bona fide so as to permit the Optionholder to participate in any change of control arising from a trigger event, provided that the Directors will forthwith advise in writing each holder of such determination. Thereafter, the Options shall lapse to the extent they have not been exercised; or
(b) to use their reasonable endeavours to procure that an offer is made to Optionholders on like terms (having regard to the nature and value of the Options) to the terms proposed under the trigger event in which case the Directors shall determine an appropriate period during which the Optionholder may elect to accept the offer and, if the Optionholder has not so elected at the end of that period, the Options shall immediately become exercisable and if not exercised within 10 days, shall lapse.
8.7 Directors’ Interests Except as disclosed in this Prospectus, no Director (whether individually or in consequence of a Director’s association with any company or firm or in any material contract entered into by the Company) has now, or has had, in the 2 year period ending on the date of this Prospectus, any interest in:
• the formation or promotion of the Company; or
• property acquired or proposed to be acquired by the Company in connection with its formation or promotion or the Offer of the Shares; or
• the Offer of the Shares.
Except as disclosed in this Prospectus, no amounts of any kind (whether in cash, Shares, Options or otherwise) have been paid or For personal use only use personal For given or agreed to be paid or given to any Director or to any company or firm with which a Director is associated to induce him or her to become, or to qualify as, a Director, or otherwise for services rendered by him or her or any company or firm with which the Director is associated in connection with:
• the formation or promotion of the Company; or
• the Offer of the Shares.
158 (a) Remuneration of Directors Refer to the Investment Overview section for details of Director remuneration.
(b) Director interests in contracts Refer to the Investment Overview section for details of Director interests in contracts with the Company.
(c) Directors’ Interests in the Company’s Securities The direct and indirect interests of the Directors in the securities of the Company as at the date of this Prospectus are included in the Investment Overview Section of this Prospectus.
(d) Shareholding Qualifications The Directors are not required to hold any Shares under the Constitution of the Company.
(e) Indemnity, Insurance and Access The Company has entered into an Indemnity, Insurance and Access Deed with each of the Directors as referred to in the Agreements with Directors or Related Parties section in Prospectus.
(f) Insurance The Company maintains Directors’ and Officers’ Liability Insurance on behalf of the Directors and Officers of the Company.
8.8 Interests of Experts and Advisors Except as disclosed in this Prospectus, no promoter, underwriter, expert or any other person named in this Prospectus as performing a function in a professional advisory or other capacity in connection with the preparation or distribution of this Prospectus, nor any firm in which any of those persons is or was a partner nor any company in which any of those persons is or was associated with, has now, or has had, in the 2 year period ending on the date of this Prospectus, any interest in:
• the formation or promotion of the Company; or
• property acquired or proposed to be acquired by the Company in connection with its formation or promotion or the Offer of the Shares; or
• the Offer of the Shares.
Except as disclosed in this Prospectus, no amounts of any kind (whether in cash, Shares, Options or otherwise) have been paid or given or agreed to be paid or given to any promoter, underwriter, expert or any other person named in this Prospectus as performing a function in a professional advisory or other capacity in connection with the preparation or distribution of this Prospectus, or to any firm in which any of those persons is or was a partner or to any company in which any of those persons is or was associated with, for services rendered by that person in connection with the formation or promotion of the Company or the Offer under this Prospectus.
HLB Mann Judd (Gold Coast) has acted as the investigating accountant in relation to the Offer. As investigating accountant, HLB Mann Judd (Gold Coast) have been involved in undertaking due diligence in relation to financial and taxation matters and preparing pro-forma financial accounts, and has prepared the Investigating Accountant’s Report which has been included in this Prospectus. In respect of this work the Company has agreed to pay HLB Mann Judd (Gold Coast) a total of $7,500 (exclusive of GST) for these services. To date HLB Mann Judd (Gold Coast) has not received fees from the Company for any other service.
Steinepreis Paganin has acted as the solicitors to the Company in relation to the Offer. In respect of this work, the Company estimates it will pay Steinepreis Paganin $40,000 (exclusive of GST) for these services. Subsequently, fees will be charged in accordance with normal charge out rates. Steinepreis Paganin has not received fees for any other services from the Company to date.
Page Seager Lawyers has acted as the solicitors to the Company in relation to the preparation of the Solicitor’s Report on Tenements
and has been involved in undertaking certain due diligence enquiries in relation to legal matters. In respect of this work, the Company For personal use only use personal For estimates it will pay Page Seager $10,000 (exclusive of GST) for these services up to the date of this Prospectus. Subsequently, fees will be charged in accordance with normal charge out rates. To the maximum extent permitted by law, Page Seager Lawyers disclaims all liability for any part of the Prospectus, except section 6 containing the Solicitor’s Report on Tenements.
Aimex Geophysics Pty Ltd has acted as Independent Geologist and has prepared the Independent Geologist’s Report which is included in Section 4 of this Prospectus. Aimex Geophysics Pty Ltd will receive professional fees of $36,600 (exclusive of GST) for the provision of the Independent Geologist’s Report. Aimex Geophysics Pty Ltd has not received any other fees from the Company to date.
159 PROSPECTUS
Wolfstar Group Pty Ltd has acted as Corporate Adviser to the Company in relation to this Prospectus. In respect of this work, Wolfstar Group Pty Ltd is estimated to receive fees range from $81,000 for a minimum raise to $111,000 for a maximum raise (exclusive of GST). Wolfstar Group Pty Ltd has received $18,000 of the total fee received as 360,000 Shares from the Company to date.
Kaz Capital Pty Ltd will act as Sponsoring Broker to the Offer. Details of the agreement with Kaz Capital Pty Ltd are set out in Section 1.6 of this Prospectus. During the 24 months preceding the lodgement of this Prospectus with ASIC, Kaz Capital Pty Ltd has not received any other fees from the Company.
8.9 Consents Each of the parties referred to in this Section: a) does not make, or purport to make, any statement in this Prospectus or on which a statement made in the Prospectus is based, other than as specified in this Section; and b) to the maximum extent permitted by law, expressly disclaims and takes no responsibility for any part of this Prospectus other than a reference to its name and a statement included in this Prospectus with the consent of that party as specified in this Section.
HLB Mann Judd (Gold Coast) has given its written consent to the inclusion in Section 5 of this Prospectus of its Investigating Accountant’s Report in the form and context in which the report is included, and to being named as Investigating Accountant, and has not withdrawn such consent before lodgement of this Prospectus with ASIC.
Steinepreis Paganin has given its written consent to being named as Solicitor to the Company in this Prospectus, and has not withdrawn such consent before lodgement of this Prospectus with ASIC.
Page Seager Lawyers has given its written consent to the inclusion in Section 6 of this Prospectus of their Solicitor’s Report on Tenements and to all statements referring to that report in the form and context in which they are included in this Prospectus, and to being named as Solicitor to the Company in this Prospectus, and has not withdrawn such consent before lodgement of this Prospectus with ASIC.
Aimex Geophysics Pty Ltd has given its written consent to the inclusion in Section 4 of this Prospectus of his Independent Geologist’s Report in the form and context of which it is included, the inclusion of statements contained in the Investment Overview, Chairman’s Letter and Overview of the Company and Projects sections of this Prospectus in the form and context in which they appear, and to being named as the Independent Geologist, and has not withdrawn such consent before lodgement of this Prospectus with ASIC.
Wolfstar Group Pty Ltd has given and as at the date hereof has not withdrawn its written consent before lodgement of this Prospectus with ASIC, to be named in this Prospectus as the Corporate Adviser to the Company in the form and context in which it is named.
Computershare Investor Services Pty Ltd has given and, as at the date hereof, has not withdrawn its written consent to be named as Share Registrar in the form and context in which it is named. Computershare Investor Services Pty Ltd has had no involvement in the preparation of any part of this Prospectus other than being named as Share Registrar to the Company. Computershare Investor Services Pty Ltd has not authorised or caused the issue of any part of this Prospectus.
Kaz Capital Pty Ltd has given its written consent to being named in the Prospectus as the Sponsoring Broker of the Offer and to the distribution of paper and electronic versions of the Prospectus. The consent of Kaz Capital Pty Ltd is given on the basis that Kaz Capital Pty Ltd has given and not withdrawn their consent to being named in the Prospectus as Sponsoring Broker to the Company as at the date of lodgement of the Prospectus with the ASIC, has not authorised or caused the issue of the Prospectus or the making of the Offer, and makes no representation regarding and takes no responsibility for any statements in or omissions
from any part of the Prospectus. For personal use only use personal For Swain Engineers has given and as at the date hereof has not withdrawn its written consent before lodgement of this Prospectus with ASIC, to the inclusion of statements in this Prospectus including the Independent Geologist’s Report from a scoping study on the two Indicated Resources at Stormont and Narrawa in the Moina Project in the form and context in which those statements appear.
Grant MacDonald and Wally Hermann has each given his written consent to all statements attributed to him respectively in the form and content in which they are included and each has not withdrawn this consent as at the date this Prospectus is lodged with ASIC. The statements are in Section 4 of the Prospectus.
160 There are a number of other persons referred to in this Prospectus who are not experts and who have not made statements included in this Prospectus nor are there any statements made in this Prospectus on the basis of any statements made by those persons. These persons did not consent to being named in this Prospectus and did not authorise or cause this issue of the Prospectus.
8.10 Electronic Prospectus Pursuant to Class Order 00/44, ASIC has exempted compliance with certain provisions of the Corporations Act to allow distribution of an electronic prospectus on the basis of a paper prospectus lodged with ASIC and the issue of securities in response to an electronic application form subject to compliance with certain provisions.
If a person has received this Prospectus as an electronic prospectus they should ensure that they have received the entire Prospectus accompanied by the Application Form. If they have not, they should email the Company at [email protected] and the Company will send to that person, for free, either a hard copy or a further electronic copy of this Prospectus or both.
The Company reserves the right not to accept an Application Form from a person if it has reason to believe that when that person was given access to the electronic Application Form, it was not provided together with this Prospectus and any relevant supplementary or replacement prospectus or any of those documents were incomplete or altered. In such case, the Application Monies received will be dealt with in accordance with section 722 of the Corporations Act.
8.11 Continuous Disclosure Obligations Following admission of the Company to the Official List, the Company will be a “disclosing entity” (as defined in Section 111AC of the Corporations Act) and, as such, will be subject to regular reporting and disclosure obligations. Specifically, like all listed companies, the Company will be required to continuously disclose any information it has to the market which a reasonable person would expect to have a material effect on the price or the value of the Company’s securities.
Price sensitive information will be publicly released through ASX before it is disclosed to shareholders and market participants. Distribution of other information to shareholders and market participants will also be managed through disclosure to the ASX. In addition, the Company will post this information on its website after the ASX confirms an announcement has been made, with the
aim of making the information readily accessible to the widest audience. For personal use only use personal For
161 PROSPECTUS
9. DIRECTORS’ CONSENTS
This Prospectus is issued by the Company and its issue has been authorised by a resolution of the Directors.
In accordance with Section 720 of the Corporations Act, each Director has consented to the lodgement of this Prospectus with the ASIC.
Dated: 25 January 2013
Signed for and on behalf of the Company
Peter McNeil
CHAIRMAN For personal use only use personal For
162 10. DEFINITIONS
In this Prospectus, unless the context otherwise requires:
“A$” and “$” means Australian dollars, unless otherwise stated.
“Applicant” means a person who submits an Application Form under this Prospectus.
“Application” means a valid application to subscribe for Securities.
“Application Form” means the application form contained in this Prospectus or a copy of the application form contained in this Prospectus or a direct derivative of the application form which is contained in this Prospectus.
“Application Money” means 20 cents being the amount payable in respect of each Share under the Offer.
“ASIC” means Australian Securities and Investments Commission.
“ASX” means ASX Limited (ACN 008 624 691).
“Board of Directors” and “Board” means the Board of Directors of the Company as constituted from time to time.
“Business Day” means a day on which the trading banks are open in Perth, Western Australia.
“Company” means Torque Mining Limited (ACN 156 369 336).
“Completion of the Offer” means the allotment of at least 15,000,000 Shares and 15,000,000 Listed Options offered under this Prospectus.
“Constitution” means the constitution of the Company.
“Corporations Act” means the Corporations Act 2001 of Australia.
“Directors” means the directors of the Company.
“EL” and “Exploration Licence” means an area granted under the Mining Act in respect to mineral exploration.
“Exposure Period” means the period of seven days (or longer as ASIC may direct) from the date of lodgement of the Prospectus with ASIC.
“Full Subscription” means $4,000,000 or 20,000,000 Shares.
“HIN” means holder identification number.
“Issue” means the issue of Securities pursuant to this Prospectus.
“Issuer Sponsored” means securities issued by an issuer that are held in uncertificated form without the holder entering into a sponsorship agreement with a broker or without the holder being admitted as an institutional participant in CHESS.
“JV” means joint venture.
“Listed Options” means the Options with the terms and conditions set out in Section 8.5(b).
“Listing Rules” means listing rules of the ASX.
“Maximum Subscription” means $5,000,000 or 25,000,000 Shares.
For personal use only use personal For “Minimum Subscription” means $3,000,000 or 15,000,000 Shares.
“Offer Period” means the period commencing on the Opening Date and ending on the Closing Date.
“Offer Price” means 20 cents being the amount payable in respect of each Share under the Offer.
“Offer” means the invitation to apply for Shares pursuant to this Prospectus.
“Official List” means the Official List of the ASX.
163 PROSPECTUS
“Opening Date” means the date immediately following the expiry of the Exposure Period.
“Option” means a right to subscribe for a Share.
“Optionholder” means a holder of an Option or Listed Option as the context requires.
“Over Subscription” means $1,000,000 or 5,000,000 Shares taking total subscription in this case to $5,000,000 and 25,000,000 Shares.
“Prospectus” means this disclosure document.
“Quotation” means quotation of the Securities on the Official List.
“Securities” means the Shares and Listed Options being offered pursuant to the Offer.
“Share Registrar” means Computershare Investor Services Pty Ltd.
“Share” means a fully paid ordinary share in the capital of the Company.
“Shareholder” means a holder of Shares in the Company.
“Tenement” means an EL, ELA or any other form of mineral licence or title held or applied for by the Company or in which the Company has an interest.
“Torque Mining” or “Torque Mining Limited” means the Company.
“WST” means Western Standard Time, Perth Western Australia. For personal use only use personal For
164 Registry Use Only
ABN 54 156 369 336
Application Form Broker Code Adviser Code This Application Form is important. If you are in doubt as to how to deal with it, please contact your stockbroker or professional adviser without delay. You should read the entire prospectus carefully before completing this form. To meet the requirements of the Corporations Act, this Application Form must not be distributed unless included in, or accompanied by, the prospectus. A I/we apply for B I/we lodge full Application Money A$ .
Number of Shares in Torque Mining Limited at A$0.20 per Share or such Please tick this box if you are a Frontier Resources Limited lesser number of Shares which may be allocated to me/us
*M000001456Q02* Shareholder registered at the date of the prospectus. C Individual/Joint applications - refer to naming standards overleaf for correct forms of registrable title(s) Title or Company Name Given Name(s) Surname
Joint Applicant 2 or Account Designation
Joint Applicant 3 or Account Designation
D Enter your postal address - Include State and Postcode Unit Street Number Street Name or PO Box /Other Information
City / Suburb / Town State Postcode
E Enter your contact details Contact Name Telephone Number - Business Hours / After Hours ()
F CHESS Participant Holder Identification Number (HIN) Please note that if you supply a CHESS HIN but the name and address details on your form do not correspond exactly with the registration details held at CHESS, your application will be deemed to be X made without the CHESS HIN, and any securities issued as a result of the IPO will be held on the Issuer Sponsored subregister. Payment details – Please note that funds are unable to be directly debited from your bank account G Drawer Cheque Number BSB Number Account Number Amount of cheque
A$ For personal use only use personal For Make your cheque or bank draft payable to Torque Mining Limited Share Account 161631_01E2IE
By submitting this Application Form, I/we declare that this application is completed and lodged according to the Prospectus and the declarations/statements on the reverse of this Application form and I/we declare that all details and statements made by me/us (including the declaration on the reverse of this Application Form) are complete and accurate. I/we agree to be bound by the Constitution of the Company.
See back of form for completion guidelines TRQA IPO SAMP_PAYMENT_000000/000001/000001/i How to complete this form A Shares Applied for F CHESS Enter the number of Shares you wish to apply for. Applications must be Torque Mining Limited (the Company) will apply to the ASX to participate in for a minimum of 10,000 Shares (other than applicants with an existing CHESS, operated by ASX Settlement Pty Ltd, a wholly owned subsidiary of shareholding in the Company who may apply for that number of Shares that ASX Limited. In CHESS, the company will operate an electronic CHESS would result in their holding being a minimum of 10,000 Shares). Applications Subregister of security holdings and an electronic Issuer Sponsored above this amount must be in multiples of 1,000 Shares. Subregister of security holdings. Together the two Subregisters will make up the Company’s principal register of securities. The Company will not be B Application Monies issuing certificates to applicants in respect of Shares allotted. If you are Enter the amount of Application Monies. To calculate the amount, multiply the a CHESS participant (or are sponsored by a CHESS participant) and you number of Shares by the price per Share. wish to hold Shares allotted to you under this Application on the CHESS Subregister, enter your CHESS HIN. Otherwise, leave this section blank Applicant Name(s) and on allotment, you will be sponsored by the Company and allocated a C Securityholder Reference Number (SRN). Enter the full name you wish to appear on the statement of share holding. This must be either your own name or the name of a company. Up to 3 joint Payment Applicants may register. You should refer to the table below for the correct G forms of registrable title. Applications using the wrong form of names may be Make your cheque or bank draft payable to Torque Mining Limited Share rejected. Clearing House Electronic Subregister System (CHESS) participants Account in Australian currency and cross it Not Negotiable. Your cheque or should complete their name identically to that presently registered in the bank draft must be drawn on an Australian Bank. CHESS system. Complete the cheque details in the boxes provided. The total amount must agree with the amount shown in box B. Please note that funds are unable D Postal Address to be directly debited from your bank account. Enter your postal address for all correspondence. All communications to you Cheques will be processed on the day of receipt and as such, sufficient from the Registry will be mailed to the person(s) and address as shown. cleared funds must be held in your account as cheques returned unpaid For joint Applicants, only one address can be entered. may not be re-presented and may result in your Application being rejected. Paperclip (do not staple) your cheque(s) to the Application E Contact Details Form where indicated. Cash will not be accepted. Receipt for payment will not be forwarded. Enter your contact details. These are not compulsory but will assist us if we need to contact you.
Before completing the Application Form the applicant(s) should read this prospectus to which this application relates. By lodging the Application Form, the applicant agrees that this application for Shares in Torque Mining Limited is upon and subject to the terms of the prospectus and the Constitution of Torque Mining Limited, agrees to take any number of Shares that may be allotted to the Applicant(s) pursuant to the prospectus and declares that all details and statements made are complete and accurate. It is not necessary to sign the Application Form. Lodgement of Application Application Forms must be received by Computershare Investor Services Pty Limited Perth by no later than 5:00pm WST on 15 March 2013. You should allow sufficient time for this to occur. Return the Application Form with cheque(s) attached to: Computershare Investor Services Pty Limited GPO Box D182 PERTH WA 6840 Neither CIS nor the Company accepts any responsibility if you lodge the Application Form at any other address or by any other means. Privacy Statement Personal information is collected on this form by Computershare Investor Services Pty Limited (“CIS”), as registrar for securities issuers (“the issuer”), for the purpose of IPO maintaining registers of securityholders, facilitating distribution payments and other corporate actions and communications. Your personal information may be disclosed to our related bodies corporate, to external service companies such as print or mail service providers, or as otherwise required or permitted by law. If you would like details of your personal information held by CIS, or you would like to correct information that is inaccurate, incorrect or out of date, please contact CIS. In accordance with the Corporations Act 2001, you may be sent material (including marketing material) approved by the issuer in addition to general corporate communications. You may elect not to receive marketing material by contacting CIS. You can contact CIS using the details provided on the front of this form or e-mail [email protected] If you have any enquiries concerning your application, please contact the Computershare Investor Services Pty Limited on 1300 850 505. Correct forms of registrable title(s) Note that ONLY legal entities are allowed to hold Shares. Applications must be made in the name(s) of natural persons, companies or other legal entities in accordance with the Corporations Act. At least one full given name and the surname is required for each natural person. The name of the beneficial owner or any other registrable name may be included by way of an account designation if completed exactly as described in the examples of correct forms of registrable title(s) below.
Type of Investor Correct Form of Registration Incorrect Form of Registration
Individual Mr John Alfred Smith J.A Smith - Use given name(s) in full, not initials TRQA Joint Mr John Alfred Smith & John Alfred & - Use given name(s) in full, not initials Mrs Janet Marie Smith Janet Marie Smith
Company ABC Pty Ltd ABC P/L - Use company title, not abbreviations ABC Co Trusts - Use trustee(s) personal name(s) Ms Penny Smith Penny Smith Family Trust - Do not use the name of the trust
Deceasedonly use personal For Estates - Use executor(s) personal name(s) Mr Michael Smith Estate of Late John Smith - Do not use the name of the deceased
Minor (a person under the age of 18) Mr John Alfred Smith Peter Smith - Use the name of a responsible adult with an appropriate designation
ABN 54 156 369 336
Application Form Broker Code Adviser Code This Application Form is important. If you are in doubt as to how to deal with it, please contact your stockbroker or professional adviser without delay. You should read the entire prospectus carefully before completing this form. To meet the requirements of the Corporations Act, this Application Form must not be distributed unless included in, or accompanied by, the prospectus. A I/we apply for B I/we lodge full Application Money A$ .
Number of Shares in Torque Mining Limited at A$0.20 per Share or such Please tick this box if you are a Frontier Resources Limited lesser number of Shares which may be allocated to me/us
*M000001456Q02* Shareholder registered at the date of the prospectus. C Individual/Joint applications - refer to naming standards overleaf for correct forms of registrable title(s) Title or Company Name Given Name(s) Surname
Joint Applicant 2 or Account Designation
Joint Applicant 3 or Account Designation
D Enter your postal address - Include State and Postcode Unit Street Number Street Name or PO Box /Other Information
City / Suburb / Town State Postcode
E Enter your contact details Contact Name Telephone Number - Business Hours / After Hours ()
F CHESS Participant Holder Identification Number (HIN) Please note that if you supply a CHESS HIN but the name and address details on your form do not correspond exactly with the registration details held at CHESS, your application will be deemed to be X made without the CHESS HIN, and any securities issued as a result of the IPO will be held on the Issuer Sponsored subregister. Payment details – Please note that funds are unable to be directly debited from your bank account G Drawer Cheque Number BSB Number Account Number Amount of cheque
A$ For personal use only use personal For Make your cheque or bank draft payable to Torque Mining Limited Share Account 161631_01E2IE
By submitting this Application Form, I/we declare that this application is completed and lodged according to the Prospectus and the declarations/statements on the reverse of this Application form and I/we declare that all details and statements made by me/us (including the declaration on the reverse of this Application Form) are complete and accurate. I/we agree to be bound by the Constitution of the Company.
See back of form for completion guidelines TRQA IPO SAMP_PAYMENT_000000/000001/000001/i How to complete this form A Shares Applied for F CHESS Enter the number of Shares you wish to apply for. Applications must be Torque Mining Limited (the Company) will apply to the ASX to participate in for a minimum of 10,000 Shares (other than applicants with an existing CHESS, operated by ASX Settlement Pty Ltd, a wholly owned subsidiary of shareholding in the Company who may apply for that number of Shares that ASX Limited. In CHESS, the company will operate an electronic CHESS would result in their holding being a minimum of 10,000 Shares). Applications Subregister of security holdings and an electronic Issuer Sponsored above this amount must be in multiples of 1,000 Shares. Subregister of security holdings. Together the two Subregisters will make up the Company’s principal register of securities. The Company will not be B Application Monies issuing certificates to applicants in respect of Shares allotted. If you are Enter the amount of Application Monies. To calculate the amount, multiply the a CHESS participant (or are sponsored by a CHESS participant) and you number of Shares by the price per Share. wish to hold Shares allotted to you under this Application on the CHESS Subregister, enter your CHESS HIN. Otherwise, leave this section blank Applicant Name(s) and on allotment, you will be sponsored by the Company and allocated a C Securityholder Reference Number (SRN). Enter the full name you wish to appear on the statement of share holding. This must be either your own name or the name of a company. Up to 3 joint Payment Applicants may register. You should refer to the table below for the correct G forms of registrable title. Applications using the wrong form of names may be Make your cheque or bank draft payable to Torque Mining Limited Share rejected. Clearing House Electronic Subregister System (CHESS) participants Account in Australian currency and cross it Not Negotiable. Your cheque or should complete their name identically to that presently registered in the bank draft must be drawn on an Australian Bank. CHESS system. Complete the cheque details in the boxes provided. The total amount must agree with the amount shown in box B. Please note that funds are unable D Postal Address to be directly debited from your bank account. Enter your postal address for all correspondence. All communications to you Cheques will be processed on the day of receipt and as such, sufficient from the Registry will be mailed to the person(s) and address as shown. cleared funds must be held in your account as cheques returned unpaid For joint Applicants, only one address can be entered. may not be re-presented and may result in your Application being rejected. Paperclip (do not staple) your cheque(s) to the Application E Contact Details Form where indicated. Cash will not be accepted. Receipt for payment will not be forwarded. Enter your contact details. These are not compulsory but will assist us if we need to contact you.
Before completing the Application Form the applicant(s) should read this prospectus to which this application relates. By lodging the Application Form, the applicant agrees that this application for Shares in Torque Mining Limited is upon and subject to the terms of the prospectus and the Constitution of Torque Mining Limited, agrees to take any number of Shares that may be allotted to the Applicant(s) pursuant to the prospectus and declares that all details and statements made are complete and accurate. It is not necessary to sign the Application Form. Lodgement of Application Application Forms must be received by Computershare Investor Services Pty Limited Perth by no later than 5:00pm WST on 15 March 2013. You should allow sufficient time for this to occur. Return the Application Form with cheque(s) attached to: Computershare Investor Services Pty Limited GPO Box D182 PERTH WA 6840 Neither CIS nor the Company accepts any responsibility if you lodge the Application Form at any other address or by any other means. Privacy Statement Personal information is collected on this form by Computershare Investor Services Pty Limited (“CIS”), as registrar for securities issuers (“the issuer”), for the purpose of IPO maintaining registers of securityholders, facilitating distribution payments and other corporate actions and communications. Your personal information may be disclosed to our related bodies corporate, to external service companies such as print or mail service providers, or as otherwise required or permitted by law. If you would like details of your personal information held by CIS, or you would like to correct information that is inaccurate, incorrect or out of date, please contact CIS. In accordance with the Corporations Act 2001, you may be sent material (including marketing material) approved by the issuer in addition to general corporate communications. You may elect not to receive marketing material by contacting CIS. You can contact CIS using the details provided on the front of this form or e-mail [email protected] If you have any enquiries concerning your application, please contact the Computershare Investor Services Pty Limited on 1300 850 505. Correct forms of registrable title(s) Note that ONLY legal entities are allowed to hold Shares. Applications must be made in the name(s) of natural persons, companies or other legal entities in accordance with the Corporations Act. At least one full given name and the surname is required for each natural person. The name of the beneficial owner or any other registrable name may be included by way of an account designation if completed exactly as described in the examples of correct forms of registrable title(s) below.
Type of Investor Correct Form of Registration Incorrect Form of Registration
Individual Mr John Alfred Smith J.A Smith - Use given name(s) in full, not initials TRQA Joint Mr John Alfred Smith & John Alfred & - Use given name(s) in full, not initials Mrs Janet Marie Smith Janet Marie Smith
Company ABC Pty Ltd ABC P/L - Use company title, not abbreviations ABC Co Trusts - Use trustee(s) personal name(s) Ms Penny Smith Penny Smith Family Trust - Do not use the name of the trust
Deceasedonly use personal For Estates - Use executor(s) personal name(s) Mr Michael Smith Estate of Late John Smith - Do not use the name of the deceased
Minor (a person under the age of 18) Mr John Alfred Smith Peter Smith - Use the name of a responsible adult with an appropriate designation