Page 1

RESOURCE Volume 6, Issue 6

GLOBAL NETWORK

Mining, renewable energy and oil & gas worldwide

SHA PING TH E MI NE SI T E O F T HE FUT U RE

talks to the Minerals Council of Australia

Featuring:Â Black Rock Mining Newfield Resources Atrum Coal Bonterra Resources Norwest Energy RESOURCEGLOBALNETWORK.COM


MINING | Brookfield Multiplex

WELCOME

Australia’s mineral resources sector is one of the most diverse, lucrative and technologically advanced in the world. The industry resembles a vital lever of the Australian economy, providing highly paid jobs and creating huge export revenues while also contributing to sustainable development on a global level. At the heart of this thriving sector is the Minerals Council of Australia, a sprawling organisation which represents the exploration, mining and minerals processing industry – nationally and internationally – in its contribution to sustainable development and society. Since July 2018, the Minerals Council has been led by Tania Constable, a distinguished veteran of the Australian resources sector. Back in August, I had the opportunity to interview Tania during her visit to London. The outcome of this conversation is a wide-ranging feature covering several salient topics, starting with the work of the council in encouraging investment, to promoting jobs of the future, putting back into regional and remote Australian communities and making a difference on a global level.

Executive Team Editor Jacob Ambrose Willson Content Director (APAC and Americas) David Hunter Creative Director Hugo Currie ICT Director Stuart Clark Contributor Michael Dawes Managing Director Simon Curran

Elsewhere in the issue, Michael Dawes from law firm Memery Crystal returns to the contributor pages after attending the Africa Down Under conference in Perth last month. We also spotlight a smattering of ASX-listed resources firms to complement the headline Minerals Council of Australia piece. Black Rock Mining is nearing construction at its large-scale graphite mine in Tanzania. Staying in Africa, Newfield Resources is developing a generational diamond asset in Sierra Leone, and over in Canada we look under the bonnet of Atrum Coal. Back in Australia, Norwest Energy is well positioned to profit from a renaissance of oil and gas exploration in the Perth Basin. We hope you enjoy the issue and encourage you to connect with us on email, Twitter and LinkedIn.

Jacob Ambrose Willson Jacob Ambrose Willson, Editor

RGN is published by Anderson Murray Media: a diverse media and information services company focused on creating and distributing engaging content to business leaders across the globe. Anderson Murray Media Fulham Green, 69-79 Fulham High Street, Main Reception, Bedford House, London SW6 3JW Tel. +44 (0)207 148 5630

VISIT US ONLINE AT RESOURCEGLOBALNETWORK.COM


CONTENTS

MINERALS COUNCIL OF AUSTRALIA

NEWS 8 Global resources news Our selection of mining, oil & gas and renewable energy stories from the last month

COVER STORY 16 Minerals Council of Australia RGN in conversation with MCA chief executive Tania Constable

COLUMNS 32 Michael Dawes Memery Crystal’s Michael Dawes reports back from down under

MINING 42 Black Rock Mining Construction ready at one of the world’s largest graphite resources 56 Newfield Resources Developing a generational diamond asset in Sierra Leone


BLACK ROCK MINING

NEWFIELD RESOURCES


CONTENTS

ATRUM COAL 68 Atrum Coal A Tier 1 hard coking coal resource in Alberta, Canada 76 Bonterra Resources Fast tracking multiple gold deposits in the Abitibi greenstone belt of QuĂŠbec

OIL & GAS 86 Norwest Energy Perfectly placed in the Perth Basin

APPOINTMENTS & EVENTS 100 Appointments Notable appointments in the resources industry from the past month 101 Events Our pick of the top forthcoming mining, oil & gas and renewable energy events happening around the world in the months to come


BONTERRA RESOURCES

NORWEST ENERGY


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NEWS | Brookfield Multiplex MINING

GLOBAL RESO

Our selection of mi renewable energy news


Resource Global Network

OURCES NEWS

ining, oil & gas and s from around the world

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NEWS

STRONG RESOURCES EXPORTS DRIVE FY TRADE SURPLUS IN AUSTRALIA Australia delivered a full-year trade surplus of AUS$49.9 billion thanks to record high exports from the resources sector, which has been boosted by higher commodity prices during the last year. Iron ore was again Australia’s biggest single contributor to exports, delivering $77 billion in revenue over the year, while also setting a new record for a single month of exports in June, with $9.5 billion. Other major export revenue streams from the resources sector included coal ($69 billion), aluminium ($15.6 billion) and copper ($9.9 billion). Sales of these commodities drove Australia’s resources sector to account for 58% of its total export revenue in 2018– 2019.

Minerals Council of Australia chief executive Tania Constable said the results highlight the vital role that the resources industry plays in a successful Australian economy. “This record revenue will sustain Australia’s economic growth and continue to deliver the funding for teachers, nurses, police and other services on which Australians rely on while funding new infrastructure projects to keep Australia moving,” she said. Australia’s resources exports have doubled over the last 10 years, following around $250 billion worth of investment in the national mining industry.


Resource Global Network 11

AUSTRALIAN VANADIUM HANDED ‘MAJOR PROJECT STATUS’ FOR WA ASSET ASX-listed Australian Vanadium has been given ‘major project status’ by the Australian federal government for its flagship deposit, located in Murchison Province, Western Australia. The granting of ‘major project status’ lasts for three years and provides formal recognition of the national strategic significance of the Australian Vanadium Project. The Perth-based company will also receive a AUS$74 million loan for the project through the Northern Australia Infrastructure Facility – a scheme supporting private sector investment in infrastructural development

across Northern Australia. “Vanadium is on the critical minerals list for Australia and the US, which means there is a market there for this globally significant resource,” said Minister for Resources and Northern Australia Matt Canavan in a statement. “This project will have a significant impact on the Western Australian economy, especially the Meekatharra region with the creation of around 400 direct construction jobs and a further 200 ongoing jobs.” Australian Vanadium say the project is one of the highest grade vanadium projects currently being developed in the world.


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NEWS

SAUDI ARAMCO REIGNITES IPO PROSPECTS AFTER REVEALING FIRST HALF PROFITS Saudi Aramco has claimed it is ready to move forward with a record US$2 trillion market flotation, after the state-owned Saudi oil giant published its profits for the first half of the year in its maiden investor call. Lower oil prices pushed the company’s profits for the six months to June down by 12% to $46.9 billion, compared with $53.2 billion during the same period in 2018. However, Aramco’s profits remain higher than the six biggest listed oil firms combined, and the group is the world’s most profitable company, comfortably ahead of tech giant Apple. In the wake of the financial statement, Aramco’s finance chief Khalid al-Dabbagh

said: “We have delivered a strong and unmatched financial performance despite lower oil prices and challenging market conditions. “The company is ready for the IPO,” he added. “The timing of the IPO itself, this is a shareholder issue. They will announce it depending on their perception of the optimal conditions.” A mega-float for Aramco has been in the pipeline for several years, with exchanges in New York, London and Singapore vying for the listing, while the company itself has remained coy on the matter.


Resource Global Network 13

GOOGLE PLOTS BIGGEST RENEWABLE ENERGY DEAL IN CORPORATE HISTORY Google has announced it will invest over US$2 billion in a package of renewable energy projects – a deal which resembles the largest ever renewables acquisition in corporate history, according to the tech giant. The 1.6GW package comprises of 18 new wind and solar projects that will be built across three continents around the world. The deal will increase Google’s clean energy portfolio by 40% – the equivalent capacity of a million solar rooftops. Chief executive Sundar Pichai revealed the plans on the eve of the Global Climate Strike on September 20th, when millions of employees and students around the world protested as part of the fight against climate change.

“We’re not buying power from existing wind and solar farms, but instead are making long-term purchase commitments that result in the development of new projects,” said Pichai. “Bringing incremental renewable energy to the grids where we consume energy is a critical component of pursuing 24×7 carbonfree energy for all of our operations,” he added. Google claimed to be the first company of its size to match 100% of its electricity use with renewables in 2017.


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16

MINING | Minerals Council of Australia

MINERALS OF AUST

RGN in conversation with MCA c


COUNCIL TRALIA

chief executive Tania Constable

Resource Global Network

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MINING | Minerals Council of Australia

The mineral resources industry has remained a pillar of strength in Australia’s economic and social development since the colonial era, and today it resembles one of the most diverse and technologically advanced resources sectors in the world. The industry delivers economic wealth, jobs, high wages, investment and tax revenues to Australia, and accounts for the largest proportion of export revenues in the entire Australian economy. At the heart of this thriving industry is the Minerals Council of Australia (MCA), which represents the exploration, mining and minerals processing industry – nationally and internationally – in its contribution to sustainable development and society. RGN’s editor spoke to the MCA’s chief executive Tania Constable about the work of the council in encouraging investment, promoting the jobs of the future, putting back into regional and remote communities and making a difference on a global level.


Resource Global Network

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MINING | Minerals Council of Australia JAW: Hi Tania. Let me start by asking how

JAW: You have been chief executive of the

the MCA supports Australia’s vast mineral

MCA since July 2018. What have been your

resources sector?

key focuses since coming into the role and what expertise do you bring to the

TC: The MCA has a membership of 81

organisation?

members. We represent 80% of the total value of production in minerals in Australia,

TC: In this role I aim to broaden the MCA’s

from exploration through to development

remit to make sure we are positioning the

and closure of mines. Our role is to provide

industry to restore national pride in minerals

policy input and advocacy on behalf of the

within Australia. At a global level, I want us to

industry, working with governments and with

be working with other organisations such as

stakeholders – particularly communities – to

the International Council on Mining & Metals

achieve that.


Resource Global Network (ICMM), working within broader multi-lateral frameworks such as the United Nations Framework Convention on Climate Change (UNFCCC), within the UN Global Compact network. The main areas I have been focusing on are: Economic reform, safety and sustainability, energy and climate and also making sure we have the right workforce for the future.

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MINING | Minerals Council of Australia JAW: Can you summarise - using latest

JAW: The mining sector is cyclical in its

figures - just how important the mineral

nature and is currently heading into a

resources sector is to Australia’s economic

production boom phase. How sustainable

development?

is this upward trend in Australia?

TC: It’s immensely important to Australia

TC: 2017/18 was a record export period for

in terms of the economic contribution, but

the minerals sector in Australia. We had

also in the social contribution it brings to

record prices and volumes of coal, iron ore,

communities. We are the biggest employer

LNG, copper and aluminium. Gold saw very

within regional and remote Australia. In total

high prices, but not necessarily a record on

there are 240,000 direct employees and 1.1

volumes.

million employees in the value chain – that includes mining, engineering, technology

We are in a production boom at the moment.

services and more. That means one in 10

It’s not as big as the mining boom of the

Australians are employed in the mining

period from 2007-12, but we are in a new

industry.

production boom. We have cycles that occur but it’s currently quite sustainable around

In 2017/18, the resources sector represented

volume and price in Australia.

AUS$220 billion in exports. If I put that in the context of the entire economy, 58% of

We’re seeing higher amounts of volume

Australia’s exports come from the mining

because we have come out of a production

sector.

phase. We’re hoping the next investments that occur in Australia will lead to a new

JAW: How do those revenues plough

construction phase. We are currently doing

back into Australian society and help all

very well on a global level in terms of being a

Australians prosper?

sustainable industry.

TC: Critically, regional Australia relies very

JAW: To what extent is the current growth

heavily on mining jobs. If I think about even

in the Australian mineral resources

the last election that we had, regional and

sector being replicated in more juvenile

remote Australia really got behind the new

industries such as the battery metals

government because it supported resources

space?

and that means jobs for the community. The mining sector is also the highest paying

TC: There are several new and emerging

sector in the country. These are highly paid,

industries that involve lithium, cobalt, nickel,

highly skilled jobs and average wage within

copper and rare earths. All of these minerals

the mining sector is $140,000 per annum.

and the associated metals that might come


Resource Global Network

“In total there are 240,000 direct employees and 1.1 million employees in the value chain – that includes mining, engineering, technology services and more. That means one in 10 Australians are employed in the mining industry” Tania Constable, CEO – Minerals Council of Australia

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MINING | Minerals Council of Australia from them are products that are used in our

around major equipment is delivering

everyday lives: mobile phones, TVs, cars and

better safety outcomes and more efficient

wind turbines. All of these end use products

operational outcomes.

come from these newer forms of minerals being made into metals. The potential for

There might be some weakening of jobs

these industries within Australia is immense.

in some areas, but you have massive job growth that occurs around the technologies

For example, there’s recently been a focus

themselves. That’s what we’ve always seen

on critical minerals such as rare earths,

with new technology – it may take away a few

and that’s interesting because importing

jobs in some areas, but it creates massive

countries like the US are developing

opportunities in other areas.

alternative markets due to the current trade dispute between China and the US.

Our industry is trying to make sure that we

There is a need for the US to be seeking

are planning for the workforce of the future,

alternative markets and Australia represents

making sure we have data analysts, robotics

an alternative market for them. While we

specialists and drone pilots to name a few.

have a strong partnership with China, we

These are all going to be new skills that we

also recognise that the US is the biggest

need for our workforce.

investor in resources within Australia in terms of foreign investment. So, we have an

We’re also partnering with other industries

opportunity to develop new markets, in this

to get a better technological outcome,

case in critical minerals.

partnering with space agencies around robotics and AI that will help us to create

JAW: How is the Australian resources

a better mine site for the future. It really

sector embracing technology and

does present an exciting opportunity for the

innovation?

future.

TC: What’s exciting for this industry is that we

JAW: On the topic of technology and jobs,

are at the forefront of innovation at a global

how are you going to navigate this current

level. Automation, AI, robotics – that’s all

period where there is anxiety surrounding

occurring in our industry at a global level, but

how hi-tech advancements are going to

I would say we are really leading the way in

impact human jobs?

Australia. TC: We’ve seen it in the past, even with the We already have autonomous trains at iron

use of phones and smartphones. That fear

ore sites in the Pilbara region of Western

around technology has been around for a

Australia. This increased level of automation

long period and it’s about preparing people


Resource Global Network

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MINING | Minerals Council of Australia


Resource Global Network for what that future can look like and making sure that regions in Australia have the right sort of opportunity to be able to take advantage of those changes. Instead of every job being moved and put into a capital city, we want to create hubs within regions in Australia to be able to manage change around AI, automation and robotics to prepare those regional centres to become a hive of activity for those future skills. JAW: You talked earlier about bridging the gap between the industry and wider society, so how important is the MCA’s recent 30 Things campaign to raise awareness of the resources sector among Australians? TC: It’s extremely important Jacob. We did research in 2018 to understand what people knew about the resources sector and we found there was a gap between understanding and awareness, particularly in women between the ages 25-40. Australian youth also saw mining as a dated industry with limited opportunities located in remote areas of the country. We tried to raise awareness about what we can do in these industries, different types of jobs that might be there, not just in traditional areas such as mining engineering or in electrical trades and diesel fitters. We wanted to show young people how their skills can be applied in the mining sector.

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MINING | Minerals Council of Australia For example, if you’re a gamer, you can be a drone pilot in this industry and you don’t necessarily have to be living away from your family and friends. The industry also requires a lot of social skills in the shape of environmental scientists and social scientists – these jobs are becoming integral to the mining sector. Those new skillsets are important to raise as opportunities. Women and youth are looking differently now at what the mining industry is all about, because it is an exciting, modern workplace that produces all the modern needs of society. JAW: Finally, what are the key challenges that are facing Australia’s mining and resources sector?


Resource Global Network TC: There are a few key challenges. We need

people or farmers, in a much more

to make sure we are preparing not just for a

sustainable way. That’s a challenge for us at a

new mine opening, but for the environmental

local level.

and social needs of communities to be taken into account when we are planning for

We are also a global industry and need to be

mines sites. That’s extremely important for

thinking about how our approach fits with

the industry to maintain a social licence to

global society and the changing needs of a

operate.

global society in areas such as climate change and social issues such as modern slavery and

Communities want more of a say in what

stewardship.

happens in their regions and they want to know that the mining industry is going to

These are challenges at the forefront of the

be a great community contributor and will

mining industry and they inform how we

leave a positive legacy for the future. The

go about our long-term plan, not just as

mining industry needs to coexist with these

an organisation but as a contributor to the

communities, whether they are Indigenous

broader industry.

a bj

29


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COLUMNS | Michael Dawes

AFRICA


Resource Global Network

A DOWN UNDER 2019: IN REVIEW Memery Crystal’s Michael Dawes reports back from down under

33


COLUMNS||Ian Michael Thomson Dawes 34 COLUMNS

September’s Africa Down Under (ADU) conference in Perth provided an opportunity to take the temperature of the mining sector – both locally and internationally. The conference, which has been running since 2003, aims to raise awareness of Australia’s interests in African mining and energy, and claims to be the largest African-focused mining event held outside of Africa. The domestic backdrop is a fading threeyear boom in the prices of a number of strategically important commodities for Australia, such as coal, iron ore and zinc, a rally in gold prices and some of the froth having come out of battery minerals like lithium and cobalt. A rough snapshot of the companies exhibiting at ADU was, unsurprisingly, heavy on gold projects. Exhibitors at the conference were split roughly equally between miners, African countries and trade. Perhaps this is a good, albeit crude, barometer for the junior African sector as in previous years there have been notably more companies exhibiting. As exploration falls out of favour in the public markets, the cost of exhibiting at conferences


ResourceGlobal GlobalNetwork Network 35 Resource

MICHAEL DAWES Memery Crystal is a full service law firm based in London, but with an international practice. The firm’s Natural Resources team has a wealth of experience of listing mining companies on the UK’s capital markets, including AIM and the Main Market. During 2018 they advised on three out of the five London listings of African mining projects, including Danakali, MOD Resources and Kropz. The team consistently ranks in the top advisers for AIM listings and the number of retained mining clients, and they have unequalled recent experience of advising on Main Market listings for companies in the sector, particularly those with an existing ASX or TSX listing who are looking to dual list in London. Michael Dawes is a Partner, and Head of the Australian Desk, at Memery Crystal. Michael and his team have advised a number of ASX and TSX listed companies on dual listing in London and accessing the UK markets.


36

COLUMNS | Michael Dawes

like ADU and the Mining Indaba in Cape Town

than the event, with ADU providing a

could be seen as not justifying the benefit.

catalyst for the international African mining community to descend on Perth. This

Many juniors speak more favourably of the

broader focus provides a better measure

121 conferences, which arguably give greater

of interest in junior African projects and

direct access to investors. As a result, the

there was plenty of activity up and down St

companies at ADU were predominantly

George’s Terrace and Ord Street amongst

developers and producers who have an

those who had saved themselves the cost of

interest in profile-raising and not just money-

exhibiting.

raising. For the developers and producers in Like most conferences, the activities on the

the conference there was a theme of

fringes often provide greater opportunities

consolidation. Of the gold companies, of


ResourceGlobal GlobalNetwork Network 37 Resource

particular interest was Resolute Mining

to position it to tap both Australia and the

(ASX/LSE:RSG), which dual-listed on the

UK for the equity needed to develop its

London Stock Exchange in June and, shortly

Botswana copper project, but the Sandfire

afterwards, completed its acquisition of Toro

deal presents an alternative method of

Gold giving it, amongst other projects, a low

financing the mine.

cost producing gold mine in Senegal and an additional c 150,000 ounces of annual

On the fringes of the conference, it was

production.

interesting to see increased interest in a London listing from domestic Australian

Another exhibitor with a dual listing was

projects. Historically, London has been seen

MOD Resources (ASX/LSE:MOD), who recently

as a stronger supporter of African projects

agreed to be acquired by Sandfire Resources

than Australia, with companies like MOD and

(ASX:SFR). MOD’s dual listing was intended

Danakali dual-listing in London to provide


38

COLUMNS | Michael Dawes

“On the fringes of the conference, it was interesting to see increased interest in a London listing from domestic Australian projects. Ultimately, for larger companies, a London listing can provide access to the LSE indices and institutional tracker funds� Michael Dawes, partner, head of corporate, Memery Crystal


Resource Global Network broader access to institutional capital to

rules typically they are also compliant with

develop their African projects.

the LSE’s rules.

Received wisdom was that purely domestic

How should companies with an existing

projects wouldn’t be as attractive to the

listing decide whether adding an LSE dual

UK institutions as their expectation was

listing is right for them? In the current climate

that these projects should be financed

it’s unlikely that London would support pure

locally. However, for projects in robust

exploration plays.

commodities, with good economics but large CAPEX requirements, it’s hard to see why UK

Typically, the companies that successfully

investors wouldn’t welcome exposure to a

dual list are either producing, or have a

jurisdiction with far lower sovereign risk.

defined path to development – in other words, post-DFS and with discussions around

Recently, Canadian gold producer Pure Gold

offtake, strategic equity and debt well

(TSX:PGM/LSE:PUR) demonstrated that you

advanced.

don’t need African assets to list in London, and that the London markets welcome

Test marketing is essential before committing

companies with ‘domestic’ assets even where

to the UK, to gauge whether the target

their home market has a history of funding

audience has an appetite for your particular

those assets.

commodity and stage of development. You also need to build the right team of advisers,

UK institutions tend to be long-term

to ensure that the listing process is efficient

investors, London has an extremely

and that you get the most out of the London

knowledgeable community of advisers and

markets once you are here.

analysts and ultimately, for larger companies, a London listing can provide access to the LSE

Ultimately, for mining companies

indices and institutional tracker funds.

headquartered in Australia or Toronto, whether their assets are domestic, African or

Whilst adding an LSE listing to an existing ASX

elsewhere, London offers a good cultural fit

or TSX listing also adds an additional layer

and the opportunity to supplement domestic

of regulation to comply with, in practice a

funds with quality institutional money.

listing on the LSE’s Standard Segment doesn’t materially increase ongoing compliance costs, with most dual listed companies finding that if they are compliant with the ASX or TSX

aj

39


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MINING | Black Rock Mining


Resource Global Network

BLACK ROCK MINING Ready to develop one of the world’s largest graphite resources

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44

MINING | Black Rock Mining

Black Rock Mining’s Mahenge Project in Tanzania hosts a long life graphite resource and is one of the largest JORC-compliant natural flake graphite resources in the world, with a mineral resource estimate of 212 million tonnes (Mt) at 7.8% total graphitic carbon (TGC) content and a reserve of 70 Mt at 8.5% TGC. The ASX-listed company started down the road to production back in 2016 with a scoping study and metallurgical testing at Mahenge, which delivered world first graphite purity results above 99%. A prefeasibility study was published in the following year before a 2018 pilot plant run on graphite concentrate from Mahenge replicated the firm’s previous TGC purity results on a larger scale.

2019 the company was handed two mining licences by the Tanzanian government for the development of the project. Most recently, Black Rock completed an additional pilot plant run in China and published an enhanced definitive feasibility study (eDFS). The eDFS was completed in response to increased product demand and feedback from customers for a more aggressive production schedule. The study incorporates a fourth 85,000 tonne production module taking total steady state production up to 340-350,000 tonnes per year (tpy). The addition of a fourth production module has no material change to the forecast capex for the first three phases. However, it will lift the overall revenues with a revised project NPV10 of US$1.16 billion, an increase of 30% over the original three module DFS.

Altering the approach The eDFS also necessitates a slight alteration to Black Rock’s phased development strategy, which is now called ‘crawl, walk, run, sprint’. Under this strategy, each module will come

The company then released its definitive

online annually after the first module, rather

feasibility study (DFS) in October 2018

than every two years as stated in the original

which envisaged a three module production

DFS.

schedule generating unlevered NPV10 (posttax and post free carried interest) of US$895

Black Rock’s managing director and CEO

million and 42.80% IRR from a forecast

John de Vries explains how the foundations

capex on module one of $115 million.

of the eDFS were laid by the success of the pilot plant runs in Canada and China, which

The pilot plant results and DFS helped Black

demonstrated to customers the quality of

Rock secure its first offtake customers

Mahenge graphite.

by the end of the year, and at the start of


Resource Global Network

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MINING | Black Rock Mining

“When we distributed samples from the pilot

four modules into the known orebody, with

plant to customers, two things happened:

the additional mill feed to be sourced from

They fell over themselves because they

the development of a third pit at the Epanko

hadn’t seen natural flake graphite anywhere

deposit.”

near as good as this previously. Secondly, nobody quite believed that we produced it by

At this point, it’s important to note that Black

flotation.

Rock has only included 5 km of the 60 km strike at Mahenge in the resource, and the

“We wanted to show further transparency

company is confident that further exploration

in the Chinese market, with regards to our

will result in the discovery of more graphite.

product. So, we shipped a second 18 tonnes sample to run through a pilot plant in China,

“There’s no shortage of graphite and

which turned into a real game-changer. Once

importantly the stuff is particularly unique

we got through that, customers began to sign

because of its purity and the flake size. That

up to our pricing framework.

was the context behind the enhanced DFS,” says de Vries.

“We then went and did the eDFS, asking the questions how big can we go and how quickly

The focus of the eDFS also evolved into

can we get there? We found we could get

discussions with financiers about a de-


Resource Global Network

risked start-up and commissioning plan,

a binding pricing framework with four of its

specifically in relation to power supply and

five offtake partners, two of which were new

the decoupling of the project development

agreements made in May.

schedule from the 220 kV high voltage lateral from Ifakara to Mahenge.

The new commitments were signed with Qingdao Yujinxi New Energy Materials and

The power line is currently being developed

Yantai Jinyuan Mining Machinery Co for three

by state-owned utility Tanesco and it should

years to supply up to a combined 50,000

be available for the second module, but

tonnes, taking the total amount of committed

Black Rock concluded that a decoupled

volumes to 255,000 tonnes per annum.

power supply schedule via short-term onsite generation would allow it to control all

Re-confirming the premium quality of

elements of the project start-up.

Mahenge concentrate to the heavily

Offtake pricing agreements

contested Chinese graphite market was fundamental to tying in pricing frameworks with offtake partners, according to de Vries.

After successfully demonstrating the quality of its product in the pilot plant operations in

“The sub-100 market refers to graphite flakes

China, Black Rock announced it had agreed

with a mesh size of -100. In China, it’s a very

47


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MINING | Black Rock Mining

John de Vries, Black Rock CEO contested market space and not a place you want to be if you can help it. Being able

“When we distributed samples from the pilot plant to customers, they fell over themselves because they hadn’t seen natural flake graphite anywhere near as good as this previously” John de Vries, managing director and CEO Black Rock Mining

to demonstrate we’re well above the 100mesh point, and able to deliver higher spec material of +98% TGC, was fundamental to securing a relationship with certain customers.” In terms of project financing, Black Rock is taking a blended approach through the consideration of several different avenues, including project level equity, conventional African-domiciled debt financing, convertible/ hybrid structures and offtake-related financing proposals. The company recently appointed Australiabased advisor Ironstone Capital to accelerate progress on financing for the Mahenge Project. Ironstone has been brought in to


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MINING | Black Rock Mining

consolidate existing pathways and establish

which has a presence in Hong Kong,

new ones with relevant banks and other

Australia, Singapore and China. Black Rock

sources of debt and finance.

is benefitting from the firm’s significant experience in the Chinese graphite market.

Ironstone also possesses valuable experience particularly useful for Black Rock with China

Large-scale spheronising trial

set to remain a dominant force in the global

In August, Black Rock delivered outstanding

graphite space.

results from a large scale spheronising and

in the Chinese market, which will be

purification trial using 400 kg of concentrate “Ultimately, whatever you do in graphite,

from the preceding pilot plant run in China,

it’s going to revolve around China in some

with the trial demonstrating a yield to final

shape or form. Most of our hardware and

product of 48% and 53% and a final purity of

procurement is coming out of China and

99.98% TGC.

we’ve got offtake supply agreements with Chinese firms, so it makes sense to try and

Crucially, these results significantly exceed

align the finance process with China as well.”

Chinese industry benchmark yields of 35-45% for battery anode materials and demonstrate

Black Rock is also working with a boutique

to Black Rock’s customers that its product can

consultancy outfit called Oriental Link,

be integrated into existing facilities.


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MINING | Black Rock Mining

“The spheronising trial has given us good direction as to whether the product will perform on a large scale, and it absolutely punched the lights out in terms of yield and chemistry”

reported spheronising results in some shape

Closing in on construction

or form. What we’ve done this time round,

Having routinely ticked off a long list of

“Everybody in the graphite sector has

rather than dealing with a cupful, we’ve done milestones over the last three years, Black it with a bathtub full. In this case about four

Rock claims it will be construction ready for

bathtubs full.

the first phase of the Mahenge Project once it finalises financing negotiations.

“When you test concentrate in a controlled lab environment, you should deliver good

Project financing and the subsequent

results. But in an industrial context, variables development schedule is now dependant on are harder to control. The reality is that we

confirmation of the Tanzanian Government’s

got very near to the results we attained in the 16% free carried interest in the project. lab in an industrial context.

Black Rock will be sitting down with the government imminently to discuss the

“This trial has given us good direction as to

terms and conditions associated with their

whether the product will perform on a large

investment.

scale, and it absolutely punched the lights out in terms of yield. When we refined it,

After a turbulent few years in the Tanzanian

it punched the lights out again in terms of

mining industry, de Vries believes the

chemistry,” says a delighted de Vries.


Resource Global Network

situation is becoming clearer for investors in

transport as a condition precedent to us

the sector, particularly as Barrick Gold and

having a business model. 60% of our material

Acacia Mining have resolved how they will

gets sold in the large flake market, which is

work together to arrive at a consensus with

fundamentally uncontested.

the government, after a long-running dispute. “That means that we can spend a bit more The firm’s boss also sees Black Rock as being

time and effort in securing our rightful place

well-positioned in the race to supply the

in that sub-100 mesh area for the EV market.

burgeoning battery tech and electric vehicle

That’s incredibly well supported by having the

(EV) markets, but in an unorthodox way.

highest grade natural flake graphite available on the planet.”

“At Mahenge, 60% of our material is large flake graphite, so we are not waiting for the EV revolution and the electrification of

ASX:BKT

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56

MINING | Newfield Resources

NEWFIELD RESOURCES Developing a generational diamond asset in Sierra Leone


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MINING | Newfield Resources

Australian exploration firm Newfield Resources gained ownership of the Tongo Mine Development in Eastern Sierra Leone through the acquisition of AIM-listed Stellar Diamonds in April 2018. Stellar had been active in West Africa for several years but was struggling to raise the capital required to get the diamond mining project off the ground, in a difficult market for junior resources companies. These conditions compelled CEO Karl Smithson to approach Newfield, who were active in Sierra Leone with a merger proposition. A merger between Newfield and Stellar was subsequently accepted via a UK Court sanctioned scheme of arrangement and with it Newfield shareholders invested approximately US$25 million to fund development at Tongo. The majority of the Stellar technical team also migrated across to Newfield to provide continuity to the project on the ground.

“The transaction was a win-win for both Stellar and Newfield shareholders and the funding Newfield brought to the project has enabled Tongo to advance rapidly to the


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MINING | Newfield Resources mine development phase,” says Smithson –

tonnes per hour (tph) DMS processing plant.

now an executive director of Newfield.

However, based on the future production profile of the mine, the company recently

During the last 16 months or so since

made the decision to install a plant capacity

the acquisition of Stellar, Newfield has

of 100tph and is working closely with South

completed an independent Front End

Africa-based engineering consultants METC

Engineering Design (FEED) study for Tongo,

Engineering in terms of the final design of the

which included the design of a detailed

plant.

underground mine, and increased the mine resource by 64% through further drilling and

“We got through all of that in the last 12

exploration work.

months, which brings us to now. In July, the board of Newfield ratified the project and

Newfield also looked into the process

made an investment decision to bring the

design for the project, initially deciding on

funding in to construct the mine.”

the relocation and refurbishment of a 50


Resource Global Network

Growing the resource

“But we need to prove that through further drilling, geological work and evaluation. That

While the arrival at an investment decision

will be a programme we will tackle some time

resembles a major milestone for Newfield,

in the future.”

Smithson believes the most pleasing development of the last year has been the

For now, the Tongo project has 7.4 Mcts

expansion of the Tongo resource from 4.5

in resource, of which 1.1 Mcts has been

million carats (Mcts) to 7.4 Mcts.

declared as reserve for an eight year life of mine (LOM). However, Newfield intends to

“Based on the other deposits in the licence

convert much of this resource into reserve as

area [only four of 11 kimberlites have been

it progresses the project and therefore sees

drilled to resource level] and the possibility

a much longer LOM than currently stated in

of going deeper on the existing deposits

official ASX documentation.

within the mine life, we believe that there is potential to double the current resource,” reveals Smithson.

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MINING | Newfield Resources

“Notwithstanding that, there is additional

presidents against a backdrop of challenging

potential from the rest of the concession,

conditions – from the country’s emergence

where we have orebodies not yet in resource.

out of civil war in 2002 to the Ebola crisis of

We know they are diamondiferous and we

2014/15.

know they hold good grade too. However, this team of geologists remained “Bringing those into the future mine plan

in Sierra Leone throughout the bouts of

will be part of our strategy. If we are able

turmoil and continued to spend money

to achieve this, we are potentially looking

on exploration, while building strong

at around 20 to 30 years LOM at Tongo,”

relationships with the government and the

Smithson projects. In fact, Newfield has

Ministry of Mines & Mineral Resources.

already started drilling on a fifth kimberlite and should bring that into resource within

“We get a lot of credibility for having

the next six to nine months.

been there as long as we have and done

Long-term stakeholders

exploration for so long. You have to do the hard miles and if you pay your dues in terms

Smithson and his team have been active in

of taxes and community support you get the

Sierra Leone for approximately 17 years now,

respect and support that you deserve, and

and in that time they have witnessed the

we certainly have.”

rise and fall of different governments and


Resource Global Network

Sierra Leone remains fairly strapped for cash

“Also, the Tongo concession area is safe and

and is still reliant on donor aid in the form of

we don’t have a need for armed security on-

loans from the IMF and other international

site. We largely look after ourselves and have

banks, but the situation is presently

around 20 expats there now with about 150

stable and the country is one of the better

locals that we’re employing.”

investment jurisdictions on the continent according to Smithson.

Socially responsible mine development

“Sierra Leone is a former UK colony and

Local employment is a key part of Newfield’s

follows British law and language with a

corporate social responsibility (CSR) strategy

parliamentary political system. So, there are

and is hugely welcomed by national citizens

certain similarities in terms of constitutional

in a country where unemployment is rife,

structures that you would find in the UK.”

particularly in the communities surrounding the Tongo mine.

The Mining Code was passed by Parliament in 2009 and is currently being updated with

“We have already created 150 jobs and

sponsorship from the World Bank. “Soon,

will be creating between 700 and 800

we’ll have a robust mining and fiscal regime

further jobs during the next phases of the

that we can understand and operate under

mine development. We will provide lots

easily.

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MINING | Newfield Resources of opportunities, particularly in the local

company to make certain expenditures

communities, to get proper contracted

in the local communities throughout the

employment with all the right insurances in

development of the mine and during the

place,” says Smithson.

LOM.

“We are going to provide a significant uplift

Through the CDA, the local communities

when considering the statistics, which reveal

form a committee of around 20 people

that every one person employed supports 10

and they decide what programmes need

more in their extended family. It’s going to

to be prioritised to bring most benefit

have a massive impact.”

to the communities. Whether this is the construction of water wells or even

Beyond this, there is also a legal requirement

schools, Newfield helps facilitate these vital

- stipulated in the Mining Charter – for

improvements.

Newfield to have a community development agreement (CDA) in place at the Tongo

“The CDA programmes help locals feel

project. This legal document binds the

engaged with the company and the


Resource Global Network development of their own community. That’s

“This time next year Newfield will be a

a very good thing, and through that forum we

company that is in production. Everyone’s

maintain harmonious relationships.”

very happy and shareholders are extremely

Coming full circle Speaking on behalf of the entire Newfield

supportive, which is shown by the recent bond raises of $30 million equivalent for the construction funds.”

team, Smithson reveals that everyone is thrilled about the progress made at the

However, the current mine plan is just the

Tongo Mine Development over the past year

tip of the iceberg for the company, given

and a half since the acquisition of Stellar.

the significant opportunities to grow the resource at Tongo, which has been labelled a

“As a geologist, it’s not very often one can

‘generational asset’ by Newfield – being that

make a discovery, evaluate that discovery

is could sustain diamond production for up

and bring it into production. We’ve seen the

to 30 years.

whole cycle and that’s extremely rewarding for ourselves.

ASX:NWF

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68

MINING | Atrum Coal

AT R U M COAL

A Tier 1 hard coking coal resource in Alberta, Canada


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MINING | Atrum Coal vendors on the best way to develop the Elan Atrum Coal was established in properties. 2012 to explore and develop high potential metallurgical The result of those discussions was an coal projects in Canada for the export markets. The ASX-listed agreement in 2017 for Atrum to acquire a 100% interest in Elan. At around the same firm’s initial focus was on the time, Atrum revamped its board with the Groundhog and Panorama additions of Charles Fear, George Edwards projects in British Columbia, and Charles Blixt - the latter being appointed which together hold more than chairman. More recently, Richard Barker one billion tonnes of high and joined the board at the start of this year. ultra-high grade anthracite JORC (Joint Ore Reserves Committee) “Each of these non-executive directors has brought outstanding credentials along with classified resources. After substantial and highly relevant experience to providing several years of exploration funding via a farm- our board,” says Atrum’s managing director in agreement, Japan Oil, Gas and and CEO Max Wang. Metals National Corporation Wang was appointed to the role in 2017 and (JOGMEC) now owns a 35% joint brings a strong background in metallurgical venture equity interest in the coal mining and global coal markets, as well Panorama North project, which as extensive experience in major project holds 174 million tonnes (Mt) engineering and development in Canada. of inferred JORC resources. However, Atrum’s current focus Historical exploration is on the accelerated exploration The tenements at Elan, especially those in the Northern areas such as Isolation South, have and development of the Elan Hard Coking Coal (HCC) project in been subject to five decades of historical exploration, starting in the early 1950s. This Southern Alberta. work included more than 220 drill holes

(mostly cored and geophysically logged) and Atrum first acquired an interest in Elan back

a significant number of trenches, adits and

in 2014 by way of a joint venture agreement

other field exploration work.

that allowed the company to earn up to a 70% interest in the Elan properties.

Extensive coking coal quality testing had

In late 2016, global coking coal markets

also been conducted on samples extracted

experienced renewed strength which

from different locations in order to confirm

facilitated discussions with the project’s

Tier 1 hard coking properties. All historical


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MINING | Atrum Coal at Elan. “Based on our extensive testing on core samples from two Elan South locations in 2018, the clean coal demonstrates Tier 1 medium volatile (mid vol) HCC characteristics closely resembling Teck’s premium products and Riversdale’s Grassy Mountain product,” Wang reveals. The Elan project is just 30 km east of Teck Resources’ Elk Valley – the beating heart of Canada’s HCC industry with 25 Mt produced across the sprawling complex per annum. Furthermore, the project is bordered to the South by the Grassy Mountain HCC project, owned by Riversdale Resources.

Max Wang, managing director and CEO

These existing facilities form part of a mining and infrastructure hub in the Crowsnest Pass region of Alberta, which will play a critical

exploration and coal quality testing data was

role in the development of Atrum’s flagship

subsequently acquired by Atrum.

project.

“In 2014, under the original JV earn-in

“In comparison with Teck’s Elk Valley, the

arrangement, Atrum funded a successful field

Elan deposits have comparable coal quality,

exploration programme to drill a number

comparable geology, comparable access to

of holes and extracted coal samples at Elan

infrastructure and a combined comparable

South. This work confirmed the existence of a

land base that could support a similarly

thick shallow coal deposit with potential Tier

scalable, multi-mine operation.

1 HCC quality at Elan South.” “The project enjoys close proximity to a high Last year, Atrum conducted extensive drilling

capacity rail line with surplus capacity that

programmes which were successful in

can deliver to several deep-water ports on

delineating an initial 298 Mt JORC resource

Canada’s West coast. This major Canadian

at the Elan project, confirming its status as a

Pacific rail line passes through Blairmore and

Tier 1 HCC asset.

Coleman, which are located only 13 km south of our Elan South development area.

Subsequent coal testing programmes also established the Tier 1 quality of the HCC


Resource Global Network

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403.592.6180

780.357.5500

780.496.9048

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“Our Elan properties also enjoy direct road

These campaigns have led to several new

access from a combination of provincial

discoveries, including some ‘outstanding’

highways and private access roads developed

results from initial drilling at the South East

by the resource and forestry industry in the

Corner of the project.

region,” notes Wang.

The immediate focus

“On the exploration side, we will continue with our 2019 drilling programme targeted

Atrum’s immediate focus will remain on the

at growing and upgrading the existing

Elan South section of the tenements, which

classification of our resource base at Elan

currently accounts for 97 Mt of the total JORC

South and Isolation South. We expect to

resource (before the 2019 exploration results

complete updated resource estimates in the

update), with the larger Elan North area

final quarter of the year.”

earmarked as the next leg of the project. Concurrently, Atrum targets the completion After securing AUS$20 million in new

of a scoping study for Atrum South before

equity financing earlier this year, the firm

the end of 2019 which would then feed into a

commenced accelerated exploration

pre-feasibility study that would be published

drilling programmes at Elan, completing

in the second half of next year.

over 100 holes by the end of September.

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MINING | Atrum Coal

“In comparison with Teck’s Elk Valley, the Elan depos comparable access to infrastructure and a combined scalable, multi-mine operation” Max Wan An expanded coal quality testing programme

The next leg

over the next several months is also set to

Elan North is Atrum’s next major focus in the

further validate the Tier 1 HCC properties

Crowsnest Pass and is a larger tenement area

of the Elan project, and will help develop

with a defined JORC resource of 201 Mt. The

an indicative product specification for Elan

current primary area of Elan North is referred

South. Comprehensive final coal quality

to as Isolation South, which holds an existing

results are expected in the first half of 2020.

JORC resource of 120 Mt.

“Finally, the next six to 12 months will

There is already an exploration programme

see us continuing to undertake our early

underway at Isolation South which is aimed

engagement programmes with stakeholders,

at expanding and upgrading the classification

including traditional land use studies by the

of the existing resource estimate. New core

First Nations,” says Wang. “We have also

samples are also planned to be extracted for

started a comprehensive programme to

further coal quality testing.

collect the full-scope baseline environmental data required for environmental impact

“The Isolation South deposit is attractive in

assessment (EIA) and project permitting at

that it possesses relatively simple geological

Elan South.”


Resource Global Network

sits have comparable coal quality, comparable geology, d comparable land base that could support a similarly ng, managing director and CEO, Atrum Coal and geometrical settings for potentially very

“A Shallow, large-scale, Tier 1 quality hard

efficient open-cut mining. Atrum’s strategy is

coking coal deposit located in a first-

to rapidly advance Isolation South, alongside

class mining jurisdiction and proximate

Elan South, as two world-class Tier 1 HCC

to critical export rail infrastructure with

developments at Elan.”

surplus capacity represents a rare asset of substantial value. The 2019 field programme

Over the last 18 months, Atrum has rapidly

at Elan is aimed at rapidly unlocking the

demonstrated the scale and quality of

potential of this asset,” concludes Wang.

the Elan HCC project through a series of exploration campaigns and test work at the Elan South and Isolation South areas.

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MINING | Bonterra Resources

BONTERRA

Fast tracking multiple gold deposits in


Resource Global Network

RESOURCES

n the Abitibi greenstone belt of QuĂŠbec

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MINING | Bonterra Resources

Throughout the first decade of its existence, Bonterra Resources operated as a small gold exploration company in the Abitibi greenstone belt in Québec, slowly building its land position in this highly prospective geological region of Canada. Like many exploration juniors, the firm relied on a series of small placements across international exchanges to keep exploration drills in the ground. This changed around three years ago when the potential of Bonterra’s flagship deposit was recognised by notable Canadian resources investor and long-time gold bull Eric Sprott. He and his partowned mining firm Kirkland Lake Gold subsequently came in with significant investments into the company. Then, in June 2018 Bonterra announced the acquisition of neighbouring firm Metanor Resources, giving it access to the only permitted processing mill in the heart of the Urban Barry Camp.

but few can claim to hold a larger contiguous

The Urban Barry Camp, located

In addition, the company plans to expand the

approximately 225 km Northeast of the city

mill from 800 to 2,400 tonnes per day in the

of Val-d’Or, contains several exploration

near term. The mill upgrade includes removal

licences owned by various junior miners,

of the existing rod mill, ball mills and 40’

land package than Bonterra following its merger with Metanor.

A commanding position The combined entity now controls three high grade gold deposits in the form of the Gladiator, Barry and Moroy deposits, a permitted processing mill as well as significant regional exploration targets with resource upside potential. Bonterra’s executive chairman and interim CEO Greg Gibson tells RGN that the merger with Metanor significantly derisks the company’s flagship Gladiator deposit by providing a processing facility along with the two additional deposits in close proximity that can generate a pipeline to production. “In a short period of around two and a half years, Bonterra has really catapulted itself to a level that most juniors would struggle to get to,” he states. “I don’t think there is another junior in the region that has a comparable portfolio of projects, including processing facilities, to match Bonterra right now.” The Urban-Barry Mill adds a huge amount of value to Bonterra’s position not least because it eliminates the requirement for up to $400 million in capex that would be spent on constructing a new mill.


Resource Global Network

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MINING | Bonterra Resources

thickener and the addition of a SAG mill, two

grow its resource base through clever deals

ball mills, gravity circuit, 75’ thickener and five

with companies that own smaller deposits

tanks for leaching-adsorption.

in the Urban Barry Camp, and also through further exploration,” Gibson reveals.

“I would expect that before the end of the year the company would be well into the

Three-pronged portfolio

expansion of that mill and at the same time

Returning to its current portfolio in the Urban

be in a position to start production while that

Barry Camp, Bonterra’s flagship project is the

expansion is going on.”

Gladiator deposit, which is currently defined over a 1.6 km strike length and to a vertical

This expansion will give Bonterra greater

depth of over 1.1 km. Crucially, the deposit

capacity to process ore from its own potential

remains open in all directions.

mine sites further down the track, while also potentially taking feed from nearby deposits

At the end of May, Bonterra was able to

in the region. There are 14 known properties

produce a NI 43-101 mineral resource

with historical resources within a 100 km

estimate for the Gladiator deposit, as part

radius of the Urban-Barry Mill.

of a wider estimate for all three deposits in the Urban Barry Camp, which confirmed the

“I believe that the company can significantly

potential scale of the deposit.


Resource Global Network

The company estimated a contained

vertical and subparallel shear zones and

indicated resource of 743,000 tonnes at

approximately 10 secondary more shallow-

an average grade of 8.46 g/t Au, totalling

dipping tension veins. Like Gladiator, these

202,000 ounces Au and inferred resources of

structures are open in all directions.

3,065,000 tonnes at an average grade of 9.10 g/t, totalling 897,000 ounces Au.

Despite being only lightly drilled to date, the Barry deposit was included in the company’s

Recent drilling at Gladiator has focused on

May mineral resource estimate, which

the Northeast and Southwest extensions

calculated indicated resources of 2,052,000

along strike of known mineralised zones.

tonnes at 5.8 g/t Au for 385,000 ounces Au

This work culminated in an exciting grade

and inferred resources of 2,740,000 tonnes at

return of 101.1 g/t over 3.9 metres from the

5.1 g/t for 453,000 oz Au.

Barbeau zone about 50 metres down plunge of the known mineralisation. In the Northeast

Finally, the Moroy deposit has delivered

zone, a second hole returned 8.1 g/t over 1.8

surprisingly strong exploration drilling results

metres.

thus far according to Gibson, including one hole from February which returned 7.9 g/t

Then there is the Barry deposit, where

Au over 12.1 metres, and another which

Bonterra has identified five main sub-

returned 15.5 g/t Au over 4.1 metres.

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MINING | Bonterra Resources

“We always had a vision that it was going

The next phases

to turn into something, but it has been

The completion of the mineral resource

surprising as to what our exploration efforts

estimate for the three deposits in the Urban

have given us, in terms of turning Moroy into

Barry Camp resembles a major milestone for

a mineable resource,” says Bonterra’s interim

Bonterra as it looks to certify the success of

CEO.

its continued exploration work.

The Moroy deposit was estimated to have

“We are pleased with the current mineral

indicated resources of 365,000 tonnes at

resource estimates on our three Urban

4.77 g/t Au for 56,000 ounces Au and inferred

Barry gold deposits,” said Gibson after the

resources of 396,000 tonnes at 4.32 g/t Au for estimates were published. “The mineral 453,000 ounces Au.

resources delineated to date are a mere snapshot in time with further indications of

“When you look at the three deposits, they

continued expansion potential along strike

all have equal benefits to being developed.

and at depth for the three deposits,” he

Gladiator is first in line to offer significant

continued.

ounce production on an annual basis. In as early as 24 months, we could have a very

After closing a $36.7 million private

significant mining operation which is in the

placement in March, Bonterra is well

middle of a low cost camp.”

positioned to carry out its near-term goals which include the next phase of exploration


Resource Global Network

drilling across the Urban Barry Camp, where

“The investment by Eric Sprott and Kirkland

the company has five rigs working on the

Lake gives Bonterra the credibility it was

three sites.

looking for. It also attracts other investors, which you need especially in this market

Following the publication of the mineral

where there are so little funds being put into

resource estimates for the Gladiator, Barry

the junior exploration market.

and Moroy deposits, the company hopes to quickly develop a preliminary economic

“Bonterra was also very lucky to be able to

assessment which would confirm the

put the Metanor deal together. Having that

economic viability of the estimated mineral

infrastructure adds a huge amount of value

resources of all three deposits.

for Bonterra. That includes permitting, water treatment facilities and more. I think it sets

In a final summary of the company’s progress

the company ahead of a lot of other juniors

over the last three years, Gibson highlights

in the space.”

the importance of Bonterra’s corporate shareholder backing, along with the transformative impact of the Metanor deal.

TSXV:BTR OTCQX: BONXF FSE:9BR2

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86

OIL & GAS | Norwest Energy

NORW ENER Perfectly placed in the


Resource Global Network

WEST RGY resurgent Perth Basin

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OIL & GAS | Norwest Energy

Norwest Energy is an ASX-listed oil and gas junior with a pure focus on exploration of the Perth Basin. Located around 250 km North of Western Australia’s capital city, the basin covers an onshore and offshore area of about 100,000 km² and is currently at the centre of an exploration renaissance after a string of high-profile recent discoveries. Norwest’s primary objective is to unlock the vast commercial potential of its portfolio in the Perth Basin. “We’re located in West Perth near the CBD and are a small team with low corporate overheads and an experienced board of three directors,” says managing director Iain Smith. “I am one of the directors, along with our chairman Ernie Myers and Dave Kennedy, who was one of the founding directors of the company 20 years ago.” The Perth Basin has been routinely explored for petroleum resources since first gravity surveys were conducted in the Northern onshore area in the early 1950s. This sustained level of exploration has led to the discovery of 20 commercial oil and gas fields and numerous additional significant discoveries of varying size.


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OIL & GAS | Norwest Energy For at least the decade up until 2014, the Perth Basin was considered a mature play by experts in the field, with only relatively small oil and gas finds yet to be uncovered by exploration teams. However, this school of thought was emphatically dispatched by a major discovery that radically altered the industry’s understanding of the basin, and how Norwest viewed its own prospects.

A game changer The Waitsia gas discovery was made by Perth-based explorer AWE in 2014 and is now viewed as the largest onshore gas find of the last 40 years in Australia, with estimated proved and probable reserves of about 844 billion cubic feet of gas. The discovery was particularly significant because it disproved conventional wisdom of the time that good porosity and permeability could not be encountered at depth in the sandstone reservoirs of the basin. At Waitsia, porosity and permeability has been preserved by various clay minerals content, which has prevented diagnesis as the reservoirs were buried at depth. “It’s really caused everyone in the basin to go back and look at their acreage position and re-evaluate it, looking at the deeper targets. This has been evidenced by Strike Energy’s recent gas discovery at West Erregulla-2.” The latest large-scale gas discovery in the

directly on trend to the North of West

Perth Basin is a very important result for

Erregulla-2, which has been described as

Norwest because it has a couple of prospects

‘staggering’ by ASX-listed Strike.


Resource Global Network some time and mapped on 2D seismic data but never drilled, according to Smith. “The recent success of Strike Energy has had two effects for our prospects. Firstly, it improves the chances of our exploration success and secondly, it increases the size of the prospects. The prospective resources within the permits are in the process of being upgraded quite significantly.” Norwest is working with its joint venture partner and operator Energy Resources (a division of mining firm Mineral Resources) on progressing further exploration of these two targets, and they are set to make a joint decision on a commitment to exploration drilling across the prospects in the first half of next year. “At the moment, we are looking at the prospective resources being upgraded and then later in the year we have a decision to make as to where we locate the exploration well. We also have a shallow oil prospect in EP368, so there are three potential well locations.” The Springy Creek oil prospect, located just North of Lockyer Deep and North Erregulla, has recently been matured through the reprocessing of existing 2D seismic data. Springy Creek is a shallow prospect with a robust structure and it holds the potential for Norwest’s prospects to the North of West Erregulla-2 are called Lockyer Deep and

up to 61 million barrels of recoverable oil.

North Erregulla (permits EP368 and EP426).

Finding Xanadu

These gas prospects have been known for

Moving to the next key prospect in Norwest’s

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OIL & GAS | Norwest Energy

Tap Gallagher’s regional and international energy expertise Partner with an insurance provider with deep understanding of the industry and the capacity to meet the full range of energy sector needs, from exploration to decommissioning and mergers and acquisitions. Gallagher Energy operates from a number of locations globally and is represented by major hubs in the Australia, New Zealand, Asia, Europe, Africa and Americas areas. Our energy sector experts are familiar with the complex challenges and changing conditions in exploration, production and distribution of energy sources, and we have the ability to secure optimum solutions.

Call 1800 240 432

ajg.com.au/energy

Cover is subject to the Policy terms and conditions. You should consider if the insurance is suitable for you and read the Product Disclosure Statement (PDS) and Financial Services Guide (FSG) before making a decision to acquire insurance. These are available at www.ajg.com.au. REF2620-1019-2.1

portfolio, the 2017 Xanadu-1 oil discovery

Therefore, Norwest recently acquired a 3D

was made in the TP/15 permit in the

transition zone seismic survey, in order to

offshore Northern area of the Perth Basin.

build a greater understanding of the overall

The discovery was confirmed after Norwest

structure of the prospect.

farmed out the TP/15 permit to three partner companies, who came in to fund 100% of the

The survey covered ground from onshore

exploration drilling at Xanadu-1.

and into the shallow waters over the prospect, making it a challenging programme

“The Xanadu prospect was located less

for Norwest to undertake and complete.

than 1.5 km from the coastline, so we were

Nonetheless, the survey was completed and

actually able to drill it with a deviated well

the data is currently being processed, with

from an onshore location, at a significant

results expected in November.

cost saving. The well was drilled and we made an oil discovery, which we are currently

“We expect to get a much better handle on

appraising.”

the structure and we hope to see sufficient potential updip from the Xanadu-1 location

The discovery well was drilled with very little

to drill an appraisal well, which potentially

understanding of the overall structure of the

could become a production well in the event

field and with very limited 2D seismic data.

of success.


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OIL & GAS | Norwest Energy

Smith also highlights downdip potential from

couple of years because the state imposed a

the Xanadu-1 well, although he cautions

moratorium on hydraulic fracturing, pending

that this is probably higher risk. The results

an independent scientific enquiry.”

from the survey will determine how Norwest moves forward with the project and whether

After the recent completion of the scientific

it will proceed with an appraisal well at

enquiry, the moratorium has been lifted by

Xanadu-1.

the WA government for existing petroleum titles. However, the necessary legislation

The final piece of Norwest’s portfolio in the

still needs to be passed for operators to

Perth Basin is the Arrowsmith discovery

commence fracking, a process which Smith

in the EP413 permit. An unconventional

believes could take 18 months.

tight gas play, the Arrowsmith-2 well was previously drilled and fracked by Norwest,

This means that the Arrowsmith discovery will

proving up the gas resource in the process.

remain on the backburner for the foreseeable future, although the lifting of the moratorium

“To progress Arrowsmith further we would

opens up the possibility for the eventual

need to drill another well with a horizontal

recommencement of the project.

section and a multi-stage frack. That’s not been possible here in WA over the last


Resource Global Network

Perfectly poised

permit. We know we have an oil discovery

By Smith’s own estimations, Norwest is

there, the question is how big is it?”

incredibly well positioned for a junior explorer in the revitalised Perth Basin.

Now, the question for investors is how can they get maximum exposure in Perth Basin?

“We’ve got great exposure to very significant

The answer could lie with Norwest – a low

prospective oil and gas resources. Nobody

market cap company with material interests

else of our size has both oil and gas

in several very large prospects in the basin.

prospects in their portfolio,” he claims. “We believe we are a logical place for “We are particularly excited about the

investors to look if they want to gain

potential within the EP368 and EP426

additional exposure to this exciting oil and

permits. Recent exploration in the basin has

gas play,” Smith concludes.

really high graded those permits. We are also hopeful of a positive result in the TP/15

ASX:NWE

a j

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APPOINTMENTS & EVENTS

APPOINTMENTS Bob Dudley calls time on his role as BP boss BP is on the brink of a new era after long-standing chief executive Bob Dudley announced he would be stepping down from the role. He will be replaced by the oil major’s current head of exploration and production Bernard Looney after BP’s annual results in February 2020. Since taking the top job in the wake of the 2010 Deepwater Horizon disaster, Dudley has guided BP’s recovery from the brink of bankruptcy.

Enercon appoints new director of research and development Brian Croke has been named the new director of research and development for German wind turbine manufacturer Enercon. Croke joins the world’s fourth largest turbine manufacturer with 20 years of experience in a range of different engineering roles. Enercon’s VP of operations Dan Nimmer said: “Brian’s strong engineering background creates a perfect foundation for directing our research and development department.”

Miner Scotgold looks further afield for new non-executive director AIM-listed Scotgold resource has appointed former Sky Betting and Games CEO Ian Proctor as a non-executive director in the firm. The gold mining junior recently projected ‘significantly improved’ returns from its Cononish gold and silver project in Scotland. Scotgold chairman Nat le Roux said Proctor’s wealth of experience as a chartered accountant provides additional breadth of experience to the board.

Tracy Grierson appointed CFO of Acceleware TSXV-listed clean tech oil and gas technologies firm Acceleware has announced the appointment of Tracy Grierson as chief financial officer. Grierson will replace Brian LeBlanc in the role, and arrives with over 20 years of experience across a wide variety of accounting and managerial arenas. Acceleware’s CEO Geoff Clark said Grierson’s focus on resultsdriven innovation will be an essential asset as the company seeks to commercialise its RF XL heating technology product.


Resource Global Network 101

EVENTS Our pick of the top mining, oil & gas and renewable energy events happening around the world in the months to come

International Mining and Resources Conference + Expo (IMARC)    October 28-31     Melbourne     Australia    Africa Oil Week     November 04-08     Cape Town     South Africa         Mines and Money London   November 25-27  London  UK      Wind Europe Offshore 2019 November 26-28 Copenhagen Denmark Investing in African Mining Indaba February 03-06 Cape Town South Africa

Want to promote your resources event? Email the editor at editorial@resourceglobalnetwork.com


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Profile for Anderson Murray Media

RGN Vol 6 Iss 6  

In August 2019, RGN's editor Jacob Ambrose Willson sat down with Tania Constable, chief executive of the Minerals Council of Australia, to d...

RGN Vol 6 Iss 6  

In August 2019, RGN's editor Jacob Ambrose Willson sat down with Tania Constable, chief executive of the Minerals Council of Australia, to d...