Annual Report to Shareholders
Perth, Sep 28, 2012 AEST (ABN Newswire) - Western Manganese Limited (
ASX:WMN) is pleased to provide the Company Annual Report to shareholders, for the year ended 30 June 2012.
Review of Operations
Nusalontar License
During the year, surface sampling was conducted over a number of manganese tenements in West Timor, Indonesia. A total of 31 samples were taken from the Company's Nusalontar tenement. The results of the surface sampling were announced on 20 September 2011.
The Board also continued extensive community awareness and socialization programs to help foster good relations with the local community with a donation made to Gerakan Nasional Orang Tua Asuh (www.gn-ota.or.id) to help support the educational needs of the Timor Tengah Utara Regency's children. Nusalontar is situated within the Timor Tengah Utara Regency.
Kasih Mulia License
No further exploration activities were conducted during the year.
Genesis Project - WMN holds option to acquire 51%
On 21 October 2011, Western Manganese Limited ("WMN") announced that it had signed a Heads of Agreement ("HOA") with Borneo Brothers Limited ("BBL") to build an alliance by having an option to purchase 51% of PT Genesis, a company holding a manganese production license in Central Sulawesi.
On 21 November 2011, WMN executed an Option Sale and Purchase Agreement and Investment Agreement with BBL which legally binds the transaction pursuant to the HOA.
The issuing of 5,000,000 ordinary shares and 10,000,000 $0.20 options to Borneo Brothers Limited to have the option to purchase 51% interest of the issued capital of PT Genesis was approved by shareholders on 23 March 2012.
Since 23 March 2012, the Company has continued its community relations campaign in Central Sulawesi where the Genesis Tenement is located. Discussions with local government representatives and the Department of forestry continued with WMN representatives. It appears that WMN has the support of the local communities should extraction commence.
Subsequent to the June 2012 quarter, the Company announced it had received confirmation of "Clean and Clear" status of its Genesis tenement from the Ministry of Energy and Mineral Resources of the Republic of Indonesia (MEMR).
The designation of "Clean and Clear", as defined under Law 4, year 2009, and PP no. 23, year 2010, provides assurance to WMN that the validity of the Company's Genesis tenement and production license has been scrutinized by MEMR, who have determined that the tenement and its respective license do not overlap with any other tenements or licenses.
The Genesis Project has attracted interest from other parties as it is an IUP production license listed as "Clean and Clear". There are only a limited number of manganese licenses in Indonesia listed as "Clean and Clear" by the MEMR. WMN is currently evaluating its plans regarding the Genesis Tenement.
Project Generation-Manganese
During the year, the Company focused on its commitment of securing additional tenements of strategic importance for the purposes of expanding the land area held by conducting a number of multi provincial exploration expeditions throughout the Indonesian Archipelago.
The company is currently reanalysing all previous manganese opportunities, with discussions ongoing with the tenement owners regarding potential acquisition.
Management feels that the current uncertainty in commodity prices and proposed amendments to Indonesian mining laws regarding mineral exports are creating opportunities to acquire quality assets under reasonable terms.
In addition to tenements previously studied, the team has become particularly interested in an artisanal mining area covering approximately 20,000 ha in West Timor. Although the area is not yet licensed as an exploration area, the local land owners have approached the Company to jointly apply for an exploration license. This joint cooperation between local communities and the company is a result of WMN's extensive Community Awareness and Socialization Programs. The company is currently evaluating the best course of action to apply for the tenements.
Project Generation-Coal
One of the objectives of Western Manganese Limited, as outlined in its December 2010 IPO Prospectus, is to also acquire interests or part thereof in nonmanganese projects. During the June 2012 quarter, the Company began actively looking at project acquisition opportunities in coal.
WMN management has identified that Indonesia's thermal coal industry, the largest sector in the Indonesian Mining Industry has changed significantly. The combination of lower coal prices and less consumption by China and India, and uncertainty regarding newly announced amendments to the Indonesian Mining Laws and regulations as well as proposed taxes has created confusion and eroded confidence amongst some of the tenement holders. WMN's management team, especially those that have joined the Company since the Board reshuffle, have extensive experience in the Indonesian Coal Industry. Management has concluded that the current market conditions described above have fostered a highly advantageous scenario for acquiring tenements. The current situation has created a "buyer's market" which the Company feels it is well positioned to take advantage of.
During the June 2012 quarter, WMN was offered not less than 28 coal tenements for review.
Of these 28 coal tenements, the Company has chosen to further review 11 tenements. These 11 opportunities range from greenfields tenements to currently producing mines with further exploration potential.
Board Reshuffle
During the half year, WMN reshuffled its Board of Directors and added a highly experienced management, operation, technical and production team with proven experience and success in the natural resources sector in Indonesia.
Christopher Clower joined the Board as a non-executive director on 25 October 2011 and was subsequently as Executive Chairman on 22 December 2011. Mr. Clower adds strength to the WMN board through his significant experience and track record of success in the Indonesian mineral, energy, corporate finance and investment banking sectors.
The Company also appointed Paulus Irawan to the Board as Non-Executive Director. Mr. Irawan adds strength to the Board with his decades of experience in the Mining, Natural Resources, Maritime/Logistics and Banking Industries in Indonesia and Australia. He brings extensive resource sector experience and financial acumen to the Board of WMN.
View the complete Western Manganese Annual Report at the link below:
http://media.abnnewswire.net/media/en/docs/ASX-WMN-606043.pdf
Contact
Western Manganese Limited
T: +61-8-9421-7777
WWW: www.westernmanganese.com
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