WHITE ENERGY COMPANY LIMITED White Energy Company Limited
White Energy Company Limited
Mining Exploration Entity Quarterly Activity
Report
and
Appendix 5B
March 2019
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White Energy Company Limited
SUMMARY OF ACTIVITY
A summary of the major items of activity for White Energy Company Limited ("White Energy", "WEC" or the "Company") during the quarter ended 31 March 2019 is outlined below.
HIGHLIGHTS
•Placement raises $1.4 million
•Negotiations to sell 51% interest in Mountainside Coal Company (USA) continuing
•Appeal hearing date in Singapore on the remitted issue of the litigation proceedings against Bayan Resources Tbk has been fixed for 10 July 2019
•Yankuang Group in Shandong Province of China is investigating the use of BCB technology in China for a brownfield and a greenfield project
•River Energy is pursuing opportunities for BCB projects in South Africa
1. AFRICA - RIVER ENERGY JOINT VENTURE - WEC 51%
White Energy's 51%-owned subsidiary, River Energy South Africa Pty Ltd (River Energy), through Proterra Investment Partners (49%), is in discussion with a number of South African coal miners interested in the Group's Binderless Coal Briquetting (BCB) technology.
Extensive testing by River Energy, including successful briquetting and combustion trials, has previously demonstrated that a saleable export grade coal product can be produced from South African reject tailings. River Energy is pursuing opportunities on mine sites in South Africa to secure access to fine coal to support BCB projects.
The BCB process provides an attractive solution for coal producers seeking to maximise mine yield and facing the environmental challenges posed by reject coal fines. In South Africa alone, it is estimated that there are over 1 billion tonnes of discarded coal in tailings facilities, much of which may eventually need to be reclaimed.
White Energy and its joint venturer in South Africa are currently considering alternative ownership and funding structures for River Energy's BCB and coal fine beneficiation businesses in South Africa.
2.NORTH AMERICA - MOUNTAINSIDE COAL COMPANY ("MCC") - WEC 51%
MCC had no coal sales revenue during the December 2018 quarter, with coal production suspended since April 2018.
MCC's management are currently planning for future mining activities.
Reclamation activity continues, with applications being made for bond releases as rehabilitation work in each area is completed.
MCC currently has additional permits in various stages of approval and many acres containing low ash Blue Gem coal resources in Kentucky that are in the initial permitting
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White Energy Company Limited
phase. MCC continues to advance the permitting process and additional leases are being sought as mine plans for new areas are progressed.
White Energy has previously announced that it would sell its 51% interest in MCC. Discussions still continue with interested parties. In the meantime some surplus mining equipment is being sold.
3. AUSTRALIA
South Australia - EL5719
During the quarter, work continued on examining coal gasification and emerging hydrogen opportunities from coal, and planning for future exploration activities.
BCB
WEC is investigating the implementation of its BCB technology for use in Yankuang Group's coal briquetting business in Shandong Province of China. Coal trials were successfully conducted at WEC's test facility in Cessnock in August 2018 and further tests are being carried out in China for a brownfield and a greenfield project. There are several steps to undertake to turn this into a commercial proposition.
Management continues investigations into opportunities to briquette discarded coal fines which currently represent an environmental liability to miners. Application of the BCB technology could provide an opportunity for miners to convert waste coal fines into a saleable product.
4. GENERAL CORPORATE
The Company has no significant secured corporate debt. Proceeds from a placement in March 2019 to a substantial shareholder, made under White Energy's Listing Rule 7.1 capacity, raised $1.4 million and the proceeds are intended to be used to fund the Company's ongoing legal proceedings against PT Bayan Resources Tbk and for general working capital.
PT Kaltim Supacoal ("KSC") - WEC 51%
Appeal hearing date fixed by Singapore Court of Appeal
The judgement in relation to the remitted issue in the legal proceedings in the Singapore International Commercial Court ("SICC") initiated by subsidiaries of White Energy, BCBC Singapore Pte Ltd ("BCBCS") and Binderless Coal Briquetting Company Pty Limited, against PT Bayan Resources Tbk and Bayan International Pte Ltd ("Bayan") was released by the SICC on 9 January 2019.
The SICC ruled in favour of BCBCS and BCBC and held that BCBCS had the financial ability to fund the KSC joint venture until the completion of commission and testing at the Tabang Plant or until June 2012. On 16 January 2019, Bayan filed a notice of appeal against the whole of the decision of the SICC in regards to the remitted issue. The appeal hearing date has been fixed for 10 July 2019. In the meantime, submissions will be made by both parties.
Management are confident that Bayan's appeal will be dismissed and that the proceedings will continue to the third tranche where damages and loss arising from Bayan's breaches and repudiation of the joint venture will be determined.
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White Energy Company Limited
The White Energy Group had invested over US$110 million in the Tabang project in Indonesia up until 2012 when Bayan repudiated the joint venture. Substantial legal costs have also been incurred in relation to the proceedings to recover damages from Bayan.
+Rule 5.5
Appendix 5B
Mining exploration entity and oil and gas exploration
entity quarterly report
Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/13, 01/09/16
Name of entity
White Energy Company Limited | |
ABN | Quarter ended ("current quarter") |
62 071 527 083 | 31 March 2019 |
Consolidated statement of cash flows | Current quarter | Year to date | ||
$A'000 | (9 months) | |||
$A'000 | ||||
1. | Cash flows from operating activities | |||
1.1 | Receipts from customers | 76 | 80 | |
1.2 | Payments for | |||
(a) | exploration & evaluation | (17) | (49) | |
(b) | development | (178) | (468) | |
(c) | production | (509) | (3,713) | |
(d) | staff costs | (817) | (2,711) | |
(e) administration and corporate costs (*) | (2,053) | (4,775) | ||
1.3 | Dividends received (see note 3) | |||
1.4 | Interest received | 19 | 20 | |
1.5 | Interest and other costs of finance paid (**) | (124) | (307) | |
1.6 | Income taxes paid | |||
1.7 | Research and development refunds | |||
1.8 | Other (provide details if material) (***) | 270 | 1,348 | |
1.9 | Net cash from / (used in) operating | (3,333) | (10,575) | |
activities |
(*)includes legal fees incurred in respect of KSC dispute and MCC administration costs.
(**)year to date amount includes interest paid to companies controlled by the Company's directors, Brian Flannery and Travers Duncan, each being a substantial shareholder of WEC.
(***)current quarter amount includes $93,000 reimbursement from Bayan Resources for the settlement of Singapore Court of Appeal legal costs, and year to date amount includes $392,000 of restricted cash received for bonded reclamation obligations and $277,000 for a non-interest bearing other payable.
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White Energy Company Limited
Consolidated statement of cash flows | Current quarter | Year to date | ||
$A'000 | (9 months) | |||
$A'000 | ||||
2. | Cash flows from investing activities | |||
2.1 | Payments to acquire: | |||
(a) property, plant and equipment | - | - | ||
(b) | tenements (see item 10) | - | - | |
(c) | investments | - | - | |
(d) | other non-current assets | - | - | |
2.2 | Proceeds from the disposal of: | |||
(a) property, plant and equipment | 1,603 | 4,317 | ||
(b) | tenements (see item 10) | - | - | |
(c) | investments | - | - | |
(d) | other non-current assets | - | - | |
2.3 | Cash flows from loans to other entities | - | - | |
2.4 | Dividends received (see note 3) | - | - | |
2.5 | Other (provide details if material) | - | - | |
2.6 | Net cash from / (used in) investing | 1,603 | 4,317 | |
activities | ||||
3. | Cash flows from financing activities | |||
3.1 | Proceeds from issues of shares | 1,400 | 13,157 | |
3.2 | Proceeds from issue of convertible notes | - | - | |
3.3 | Proceeds from exercise of share options | - | - | |
3.4 | Transaction costs related to issues of | (124) | (241) | |
shares, convertible notes or options | ||||
3.5 | Proceeds from borrowings (***) | 1,757 | 4,548 | |
3.6 | Repayment of borrowings(****) | (1,402) | (5,902) | |
3.7 | Transaction costs related to loans and | - | - | |
borrowings | ||||
3.8 | Dividends paid | - | - | |
3.9 | Other (provide details if material) | - | - | |
3.10 | Net cash from / (used in) financing | 1,631 | 11,562 | |
activities |
(***)current quarter amount represents shareholder loans from Proterra Investment Partners for its 49% equity interest in MCC and River Energy, and the year to date amount includes loans totalling $500,000 provided by companies controlled the Company's directors, Brian Flannery and Travers Duncan, each being a substantial shareholder of WEC.
(****) current quarter amount includes the part repayment of shareholder loans for $1,388,000 from Proterra Investment Partners for its 49% interest in MCC, and the year to date amount includes the repayment of loans totalling $4,500,000 provided by companies controlled the Company's directors, Brian Flannery and Travers Duncan.
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White Energy Company Limited published this content on 30 April 2019 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 30 April 2019 07:57:04 UTC
