ABN: 42 072 745 692 MINCOR RESOURCES NL RESOURCES MINCOR ANNUAL REPORT ANNUAL 2019 Ground Floor 9 Havelock Street West Perth 6005 2019 Western Australia PO Box 1810 ANNUAL West Perth 6872 Western Australia REPORT Telephone: (+618) 9476 7200 Facsimile: (+618) 9321 8994 mincor.com.au HIGHLIGHTS of the year 2019 CORPORATE DIRECTORY Directors Securities Exchange Listing Solicitors NICKEL Brett Lambert (Chairman) Mincor Resources NL shares are listed Gilbert + Tobin David Southam on the Australian Securities Exchange Level 16, Brookfield Place Michael Bohm (Home Branch – Perth) Tower 2, 123 St Georges Terrace Liza Carpene Perth 6000 ASX Code: MCR • Binding Ore Tolling and • Outstanding ongoing • Strong opportunities for Western Australia Concentrate Purchase success at the Cassini nickel Resource and Reserve Agreement signed with BHP discovery, with the Mineral growth emerging from Company Secretary Billiton Nickel West Pty Ltd, Resource increased to ongoing exploration, with ACN and ABN Share Registry Shannon Coates providing Mincor with a 0.99Mt at 3.8% Ni (37,800t drilling at South Juno (Juno ACN: 072 745 692 Computershare Investor Services Pty Ltd processing and sales route of contained nickel) with 4) demonstrating early ABN: 42 072 745 692 Level 11, 172 St Georges Terrace and setting the foundation 91% now classified in the similarities to Cassini and Perth 6000 for a new era of nickel Indicated category and drilling underway at Spanner Registered Office Western Australia sulphide mining in the world- available for conversion to (Long Nickel Operation) to Ground Floor, Auditors class Kambalda District. Ore Reserves. upgrade the current Inferred 9 Havelock Street PricewaterhouseCoopers Mineral Resource to the West Perth 6005 Date and Location of • Acquisition of the Long • Total high-grade nickel Western Australia Brookfield Place Indicated category. Nickel Operation from Mineral Resource base 125 St Georges Terrace Annual General Meeting Perth 6000 Independence Group within the Kambalda District Thursday, 7 November 2019 Western Australia at 11.30am NL, including an existing increased to 4.7Mt at 3.7% Ni Postal Address high-grade JORC Mineral (175,300t of contained nickel). Venue: Celtic Club 48 Ord Street, West Perth Resource of 0.75Mt at 4.2% PO Box 1810 • Feasibility Study for West Perth 6872 Ni (32,000t of contained Bankers Integrated Nickel Restart Plan Western Australia nickel) and offering near- Commonwealth Bank of Australia commenced and targeted term production potential. for completion late in the December 2019 quarter. Contact Details Telephone: (+618) 9476 7200 Facsimile: (+618) 9321 8994 Website: www.mincor.com.au Email: [email protected] MINCOR RESOURCES NL Annual Report 2019 85 GOLD • FY2019 gold production • Strategic review of totalled 22,667oz. If the June Widgiemooltha Gold 2019 gold production had Operations completed in not been delayed due to an June 2019, resulting in the unscheduled shutdown at the decision to fully apply the contract mill, FY2019 gold Company’s resources to the production would have been recommencement of nickel 25,152oz. production and evaluate strategic alternatives for the • Gold sales of 22,667oz at an gold business. average price of A$1,786/oz. • FY2020 production guidance • Zero LTI during FY2019. of ~9,000oz. Mining ceased in September 2019 and processing will be completed December 2019 quarter. CORPORATE • Experienced mining • $23.3 million capital executive David Southam raising completed (before commenced as Managing costs) to accelerate the Director on 1 February 2019. Company’s nickel restart strategy, comprising a • Experienced nickel mining strongly supported $18 executive Dean Will million Share Placement and commenced as oversubscribed $5.3 million Chief Operating Officer Share Purchase Plan. on 1 July 2019. • Cash balance of A$29.2 million at year-end. FOCUS for the year ahead Mincor is rapidly progressing the development of its nickel assets within Kambalda - Australia's largest high-grade nickel sulphide district. • Maiden Ore Reserve for the Cassini deposit MINCOR’S FOCUS IS TO • Completion of DFS for the Company’s RE-ESTABLISH Integrated Nickel Restart Plan SUSTAINABLE NICKEL • Minimum 4 years of Ore Reserve base on PRODUCTION a throughput of 400ktpa-600ktpa at the Kambalda Nickel Concentrator • Geotechnical drilling to confirm box-cut location and portal position for development of the Cassini deposit • Progress exploration at regional targets, such as Juno 4 to increase the resource base • Finalise metallurgical testing • P otential early capital works including box-cut and surface infrastructure for Cassini and Long development CONTENTS CHAIRMAN’S REPORT 4 MANAGING DIRECTOR’S REPORT 6 NICKEL MARKET 8 NICKEL ASSETS 9 GOLD ASSETS 18 TOTTENHAM COPPER PROJECT 20 MINERAL RESOURCES AND ORE RESERVES STATEMENT 21 FINANCIAL REPORT 2019 24 ADDITIONAL SHAREHOLDER INFORMATION 81 TENEMENT LIST 82 CORPORATE DIRECTORY 85 CHAIRMAN’S REPORT I am pleased to report on what has been an eventful and, Resource in-fill and extensional drilling in many respects, ground-breaking year which saw Mincor is now underway at Long to further achieve substantial progress towards re-establishing build our Mineral Resource base in support of a Definitive Feasibility Kambalda as a significant nickel mining centre. Study (DFS) for an integrated mine plan, scheduled for completion In February this year, Mincor welcomed A particularly important element towards the end of the year. new Managing Director, David Southam, of Mincor’s restart strategy – and who has brought a wealth of corporate one of the key achievements of the These studies and resource and commercial experience in the year – was the completion of a new development activities are underwritten nickel and battery metals sector and modern offtake agreement with by a recently completed circa $23 to the Company. Under David’s BHP Billiton Nickel West Pty Ltd (BHP million capital raising, which received leadership, Mincor is actively pursuing Nickel West) that provides us with a exceptional support from both new an integrated nickel restart strategy clear pathway back to the production and existing shareholders. This capital aiming to establish a new generation and sale of nickel concentrate. raising resulted in the introduction of profitable and sustainable mines, of a number of new institutional building on our proud and successful The binding Ore Tolling and Concentrate shareholders to our register. Purchase Agreement, which was signed operating history as a Kambalda I believe the outstanding response nickel miner. I believe this strategy has in early August 2019, replaces the original 20-year old WMC Resources from investors to our capital raising potential to deliver transformational reflects recognition of the growth growth in the coming years. agreement and marks the beginning of an exciting new era for Mincor and the opportunity that Mincor presents The expansion of Mincor’s high quality Kambalda nickel industry. within the nickel space, and I would nickel Mineral Resources and Ore like to sincerely acknowledge the Reserves has been a fundamental The new offtake agreement was support of all those who contributed. aspect of the restart strategy and is negotiated after a broad strategic As a result, the Company began the one of several areas in which we have review of alternatives, including the 2020 financial year with $29 million had great success. In August 2018, we potential construction of our own cash at bank, no debt and a strong reported a substantial maiden Mineral concentrator, and represents an platform from which to transform the Resource for the Cassini deposit. On- economic step-change for our existing Company into a successful mid-tier going diamond drilling at Cassini has Kambalda nickel assets, while also nickel producer. since significantly expanded this high opening the door to potential new growth opportunities in the District. With this in mind, we are continuing grade resource, which now stands to build a strong corporate and at 0.99Mt at 3.8% nickel for 37,800 We are very pleased to have secured operational team to execute the tonnes of contained metal. a Tier-1 partner like BHP Nickel West Company’s plans. The appointment of Cassini now ranks amongst the most to support our long-term growth Dean Will as Chief Operating Officer significant nickel deposits in the ambitions. during the year marked a key step in Kambalda District, which is particularly this regard. Dean is the ideal person to Our restart strategy gained further notable considering that this is a recent lead our project team given his broad momentum during the year when discovery and, it took several decades industry experience and extensive we were successful in acquiring the to reveal the full potential of the major knowledge of our Kambalda assets, Long Nickel Operation (Long) from Kambalda nickel deposits. We are having previously worked for Mincor Independence Group NL (ASX: IGO). aiming to deliver further growth at as Chief Mining Engineer between The acquisition of Long has further Cassini over the coming years. 2002 and 2011. consolidated our dominant footprint in the North Kambalda District, expanded Underpinning Mincor’s strategy is our high-grade nickel Mineral Resources our confidence in the long-term inventory and opened up important fundamentals of the nickel market. operational synergies with the nearby Durkin North deposit. This transaction also introduced IGO to Mincor’s register as a strategic shareholder. 4 MINCOR RESOURCES NL Annual Report 2019 While the nickel price, like other Given our unequivocal focus on I would also like to acknowledge the commodity prices, fluctuated during recommencing nickel production contribution of our former Managing the year in response to geopolitical in the near term, a review of the Director Peter Muccilli, who stepped concerns such as the US-China trade Widgiemooltha gold business was down during the year following war, nickel’s performance has started completed during the year. This led to a distinguished 14 year career at to diverge from other base metals due a decision to place our gold operations Mincor.