Microsoft Word - Oct_31_2014_DRX_ASX_ Sep2014_Quarterly
QUARTERLY REPORT
HIGHL
GHTS
EXPLORATION ACTIVITIES REPORT QUARTER ENDED 30 SEPTEMBER 2014
CYCLONE ZIRCON PROJECT (WA)
TICK HILL GOLD PROJECT (QLD)
Final cash call payment
received from Perpetual
Meetings held with Glenco re executives to finalise the
Mining Holding
Limited (PMHL), allowing PMHL to
Tick Hill Optio
agreement and facilitate full transfer of
earn a 6% joint venture (JV) participat ng interest in
ML titles and ownership to Diatreme. Internal planning
the Cyclone Project.
commenced for immedi ate activity
on transfer of
Negotiations progressing
with traditional owners the
license assessing alluvi al, colluvial and tailings opportunities on site.
Pila Nguru (RNTBC) for the Cyclone Project Mining
Agreement. Agreement finalisation followed by a signing ceremony planned on site for mid-November.
CAPE BEDFORD HM PROJECT (QLD)
Discussion commenced w ith land owners to facilitate exploration agreement and support for grant of EPM.
PER documentation has
been lodged with EPA.
Project remains an important priority for Diatreme.
Referral lodged under Commonwealth EPBC Act, and
notification received that the proposal does not require further assessment and approval under the EPBC Act.
GRAYS HILL COPPER PROJECT (QLD)
Review of historical exploration data and reports undertaken by consult ant geologist. Opportunity
In-house technical work underway to develop options
identified for
both struc turally controlled epithermal
and
work program for optimisation of
the Cyclone
mineralisation and porphyry mineralisation.
mine plan. Includes CAPEX and OPEX studies for
anticipated significant cost reduction
by use of
TENEMENT REVIEW
improved mine planning and processing technologies.
CLERMONT COPPER PROJECT (QLD)
A review of Diatreme's tenement holdings is underway to ensure any retentions, renewals or new applications
are strictly consistent with the Companies commercial
Ongoing discussions with a third party regarding JV
opportunity at Clermont.
objectives.
Diatreme Resources Limited is an Australian based divers fied mineral explorer with sig ificant projects in WA, QLD, VIC and SA.
Australian Securities Exchange
Codes: DRX, DRXO
Board of Directors
Key Pro jects:
• Cyclo ne Zircon Proje t
• Clerm ont Copper Project
• Tick H ill Gold Project
The Company seeks to develop the Cyclone Zircon
Non-executive:
• Cape Bedford Silica/
MS Project
Depo it in WA,
through a
joint venture
William Wang - Chairman
arrangement, and number of project
onducts exploration over a areas prospective for heavy
Andrew Tsang
Daniel Zhuang
Registe red Office:
Level 2, 87 Wickham Terrace
mineral sands, silica sand, copper a d gold.
Executive:
Spring Hill, QLD 4000
The
Board and senior personnel exhibit wide
Neil McIntyre - Chief Executive
Postal Address:
experience, ranging through the exploration,
devel pment and financing phases of resource project management.
Tuan Do - Chief Financial Officer
Ian Reudavey - Chief Geologist
Joint Company Secretarie : Leni Stanley and Tuan Do
PO Box 10288
Brisban e Adelaide Street
QLD 40 00
Diatrem e Resources Limited Contact: Neil McIIntyre - Chief Executive Phone: +61 7 3832 56 6
Fax: +6 1 7 3832 5300
QUARTERLY REPORT
CYCLONE ZIRCON PROJECT (WA)
Project de-risking activities under the joint venture with Perpetual Mining Holding Limited continued during the quarter with the focus on preparation of the Public Environment Review (PER) documentation and progressing mining agreement negotiations with the Pila Nguru People. On the 16th September 2014 Diatreme received the
final cash call amount from PMHL under the HOA signed in January 2014, thereby completing its initial farm-in commitment on the Cyclone Zircon Project.
The environmental studies and assessment processes for the Project have been completed in accordance with the PER schedule which has been agreed with the Western Australian Environmental Protection Authority (EPA). The PER document has now been lodged with the EPA.
A referral for the Cyclone Project was submitted under the Commonwealth Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act), and the company has been advised that the proposed action is not a controlled action and therefore does not require further assessment and approval under the EPBC Act.
Negotiations between Pila Nguru and Diatreme for the Cyclone Project Mining Agreement have reached agreement for the principal commercial terms between the parties, with work now moving on to drafting of the encompassing legal agreements. A formal signing on site at Tjuntjuntjara with the Pila Nguru is anticipated for mid November 2014.
In-house technical work is underway to develop options and a work program for optimisation of the Cyclone mine plan. This will include CAPEX and OPEX studies for anticipated significant cost reductions through use of improved mine planning and processing technologies. Significant capital cost savings have been identified through use of various adjustments to mining techniques including the potential use of semi-mobile plant following the mining face saving significant pumping and pipeline costs, and new MSP spiral processing technologies that allow higher mineral recovery rates.
The introduction of the Mining Rehabilitation Fund (MRF) by the WA Mines Department has facilitated full refund of environmental bonds that were lodged for the active exploration tenements that make up the Cyclone Project (i.e. E69/1920, E69/2408 and E69/2425). Similarly, Rehabilitation Reports have been prepared and lodged with the WA Mines Department to for expired WA tenements (i.e. E69/2222, E69/2426, E69/2427, E69/2428, E69/2429) to facilitate refund of outstanding environmental bonds attached to the listed tenements.
CLERMONT COPPER PROJECT (QLD)
A review of the Clermont project, and in particular the Rosevale Porphyry Corridor, is underway - with development of a proposed exploration program and identification of lower priority prospects and project tenement area that could be relinquished.
Data for the project is currently being reviewed by a third party for possible JV opportunity.
TICK HILL GOLD PROJECT (QLD)
Meetings have been held with Glencore personnel to progress the 2007 option agreement and facilitate transfer of the three Tick Hill Mining Leases to Diatreme Resources. Internal planning has commenced for immediate activity on transfer of license to assess mining and processing opportunities for gold associated with alluvial, colluvial and tailings material on site. In addition to this, exploration drilling to test possible faulted offsets of the Tick Hill mineralising structure is planned.
The company anticipates finalisation of transfers and tenement ownership in Diatreme's name by mid-November.
CAPE BEDFORD SILICA/HMS PROJECT (QLD)
Discussions are ongoing with traditional land owners to facilitate an exploration agreement for the Cape Bedford area and a letter of support for grant of EPM. This project has been identified as an important company priority to allow exploration activities to commence as soon as possible on site.
GRAYS HILL COPPER PROJECT (QLD)
A review of historical exploration data and reports for the Wasp Porphyry prospect was undertaken by a consultant geologist familiar with porphyry related mineralisation systems. It is apparent that the Wasp prospect displays classic porphyry alteration together with low grade copper-molydenum mineralisation, but has been discounted by previous explorers in the 1970's and 1980's as not representing potential open pittable
mineralisation.
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QUARTERLY REPORT
An exploration opportunity has been identified for both structurally controlled epithermal mineralisation (which was not recognised/targeted by previous explorers) and porphyry mineralisation beyond the limits of previous drilling. Historical drilling has not fully tested the areal or depth extent of the porphyry as it was typically <150m deep, and focussed on the outcropping south-eastern portion of the granodiorite stock. Field work is required to better assess to exploration opportunity at the Wasp prospect.
PROJECT TENEMENT RATIONALISATION
As part of a review of Diatreme's exploration strategy, Diatreme's tenement holdings and applications have been re-assessed with several tenement applications being withdrawn and non-core tenement holdings recommended for relinquishment. This will reduce tenement administration costs and allow Diatreme to focus on its core projects. Appendix 1 provides details of the exploration tenements disposed during the quarter.
The Noorina 2 (SA) HM tenement was relinquished due to a review of exploration prospectivity which suggested limited potential for significant HM mineralisation.
An application was lodged to relinquish the Elliston (SA) HM tenement due to review of exploration prospectivity which suggested limited potential for significant HM mineralisation, and proposed exploration environmental conditions relating to the presence of the Musgrave Prescribed Wells Area over a large portion of the EL.
The HoA for the Braemar Iron JV on the Anabama tenements in SA has been terminated and Diatreme is planning to relinquish the Anabama tenements in due course.
An ongoing review of Diatreme tenement holdings will ensure that any retentions, renewals or new applications are strictly consistent with the Companies commercial objectives.
CASH POSITION
The Company's cash position at 30 September 2014 (Appendix 5B) was $1,423K, with the final cash call for the
Cyclone Project HOA with PMHL being received during September 2014 quarter.
APPENDIX 1
Appendix 1 provides information required under ASX listing rule 5.3.3 for mineral exploration entities.
Dated 31 October 2014
Neil J McIntyre
Chief Executive
Company contact details:Tel : +61 7 3832 5666
Fax : +61 7 3832 5300
Email : [email protected]
Competent Person Statements
The information in this report, insofar as it relates to Exploration Results from the Grays Hill projects is based on information compiled by Mr Ian Reudavey, who is a full time employee of Diatreme Resources Limited and a Member of the Australian Institute of Geoscientists. Mr Reudavey has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he has undertaken to qualify as a Competent Person as defined in the 2012 Edition of the
'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Reudavey consents to the inclusion in the report of the matters based on the information in the form and context in which it appears.
The information in this report that relates to Exploration Results and Mineral Resources from the Cyclone Zircon Project is based on information compiled by Mr Ian Reudavey, a Competent Person who is a Member of the Australian Institute of Geoscientists. Mr Reudavey is a full time employee of Diatreme Resources Limited. Mr Reudavey has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Reudavey consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
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QUARTERLY REPORT
APPENDIX 1
Appendix 1 provides information required under ASX listing rule 5.3.3 for mineral exploration entities.
Mining tenements held at the end of the quarter and their location
|
State
|
Tenement Name
|
Tenement ID
|
Location
|
Interest
|
Holder
|
Comments
|
|
SA
|
Anabama North
|
EL4783
|
Anabama
|
100%
|
CHAL
|
Granted
|
|
SA
|
Anabama
|
EL5138
|
Anabama
|
100%
|
CHAL
|
Granted
|
|
SA
|
Noorina 1
|
EL 5045
|
Eucla Basin
|
100%
|
LSPL
|
Granted
|
|
SA
|
Elliston
|
EL 5429
|
Eucla Basin
|
100%
|
DRX
|
Granted
|
|
WA
|
Wanna Lakes
|
E69/1920
|
Eucla Basin
|
100%
|
LSPL
|
Granted
|
|
WA
|
Wanna Lakes East
|
E69/2408
|
Eucla Basin
|
100%
|
LSPL
|
Granted
|
|
WA
|
Wanna-South
|
E69/2425
|
Eucla Basin
|
100%
|
LSPL
|
Granted
|
|
WA
|
Serpentine
|
E69/3113
|
Eucla Basin
|
100%
|
LSPL
|
Granted
|
|
WA
|
Cyclone
|
M(A) 69/141
|
Eucla Basin
|
100%
|
LSPL
|
Application
|
|
QLD
|
Clermont
|
EPM17968
|
Clermont
|
100%
|
CHAL
|
Granted
|
|
QLD
|
Parapet
|
EPM19189
|
Clermont
|
100%
|
CHAL
|
Granted
|
|
QLD
|
Expedition Creek
|
EPM19544
|
Clermont
|
100%
|
CHAL
|
Granted
|
|
QLD
|
Grays Hill
|
EPM25117
|
Yeppoon
|
100%
|
DRX
|
Granted
|
|
QLD
|
Cape Bedford
|
EPM(A)17795
|
Cape Bedford
|
100%
|
DRX
|
Application
|
|
QLD
|
Tick Hill
|
ML7094
|
Duchess
|
100%
|
MIM*
|
Granted
|
|
QLD
|
Tick Hill
|
ML7096
|
Duchess
|
100%
|
MIM*
|
Granted
|
|
QLD
|
Tick Hill
|
ML7097
|
Duchess
|
100%
|
MIM*
|
Granted
|
|
VIC
|
Glenthompson
|
EL5478
|
Glenthompson
|
100%
|
CHAL
|
Granted
|
Mining tenements acquired and disposed of during the quarter and their location
|
State
|
Tenement Name
|
Tenement ID
|
Location
|
Interest
|
Holder
|
Comments
|
|
SA
|
Noorina 2
|
EL 5046
|
Eucla Basin
|
100%
|
LSPL
|
Relinquished
|
|
QLD
|
Grays Hill
|
EPM25117
|
Yeppoon
|
100%
|
DRX
|
Granted
|
Beneficial percentage interests held in farm-in or farm-out agreements at end of the quarter
|
State
|
Project Name
|
Agreement Type
|
Parties
|
Interest held at end of quarter by exploration entity or child entity
|
Comments
|
|
WA
|
Cyclone Zircon
Project
|
Farm-out Heads
of Agreement
|
LSPL and Perpetual
Mining Holding Limited
|
94%
|
HoA announced Jan 2014, initial 6% farm-
out completed 18 Sept 2014
|
|
QLD
|
Tick Hill Gold
Project
|
Option & Sale
Agreement
|
DRX and MIM
|
100%
|
Option exercised by DRX
|
|
QLD
|
Tick Hill Gold
Project
|
Farm-out
Agreement
|
DRX and Superior
Resources Limited
|
100%
|
Announced Aug 2011, subject to pre- conditions relating to option and sale agreement between DRX and MIM
|
Beneficial percentage interests in farm-in or farm-out agreements acquired or disposed of during the quarter
|
State
|
Project Name
|
Agreement Type
|
Parties
|
Interest held at end of quarter by exploration entity or child entity
|
Comments
|
|
SA
|
Anabama Iron
Project
|
Farm-out Heads
of Agreement
|
CHAL and Braemar Iron
Pty Ltd
|
100%
|
HoA announced Jan 2013, terminated Oct
2014
|
Abbreviations:
|
EL
|
South Australia, Victo
|
ria Exploration Licence
|
DRX - Diatreme Resources Limited
|
|
EPM(A)
|
Queensland
|
Exploration Permit for Minerals (Application)
|
CHAL - Chalcophile Resources Pty Ltd
|
|
EPM
|
Queensland
|
Exploration Permit for Minerals
|
LSPL - Lost Sands Pty Ltd
|
|
M(A)
|
Western Australia
|
Mining Lease (Application)
|
MIM - Mount Isa Mines
|
|
ML
|
Queensland
|
Mining Lease
|
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