Orion Minerals : Annual Report to Shareholders - 2021

2021

ANNUAL REPORT

Building a sustainable, new-generation base metals company

Delivering growth and opportunity by discovering, developing and producing metals for a cleaner future

FORWARD-LOOKING STATEMENTS

This report may include forward-looking statements. Such forward-looking statements:

• are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Orion, are inherently subject to significant technical, business, economic, competitive, political and social uncertainties and contingencies;
• involve known and unknown risks and uncertainties that could cause actual events or results to differ materially from estimated or anticipated events or results reflected in such forward-looking statements; and
• may include, among other things, statements regarding targets, estimates and assumptions in respect of metal production and prices, operating costs and results, capital expenditures, mineral reserves and mineral resources and anticipated grades and recovery rates, and are or may be based on assumptions and estimates related to future technical, economic, market, political, social and other conditions.

Orion disclaims any intent or obligation to update publicly any forward-looking statements whether as a result of new information, future events or results or otherwise.

The words 'believe', 'expect', 'anticipate', 'indicate', 'contemplate', 'target', 'plan', 'intends', 'continue', 'budget', 'estimate', 'may', 'will', 'schedule' and similar expressions identify forward-looking statements.

All forward-looking statements made in this report are qualified by the foregoing cautionary statements. Readers of this report are cautioned that forward- looking statements are not guarantees of future performance and are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein.

All information in respect of Exploration Results and other technical information should be read in conjunction with Competent Person Statements in this report (where applicable) and relevant ASX announcements released by Orion.

To the maximum extent permitted by law, Orion and any of its related bodies corporate and affiliates and their officers, employees, agents, associates and advisers:

• disclaim any obligations or undertaking to release any updates or revisions to the information to reflect any change in expectations or assumptions;
• do not make any representation or warranty, express or implied, as to the accuracy, reliability or completeness of the information in this report, or likelihood of fulfilment of any forward-looking statement or any event or results expressed or implied in any forward-looking statement; and
• disclaim all responsibility and liability for these forward-looking statements (including, without limitation, liability for negligence).

ABOUT THIS REPORT

This Annual Report is a summary of the operations, activities and performance of Orion Minerals Limited ABN 76 098 939 274 and its financial position for the year ended 30 June 2021. In this report, unless otherwise stated, references to Orion Minerals, Orion, the Company, we, us and our refer to Orion Minerals Limited. Monetary amounts in this document are reported in Australian dollars (AUD, $), unless otherwise stated.

CONTENTS

ABOUT THIS REPORT

FORWARD-LOOKING STATEMENTS

CORPORATE PROFILE

	1	Key achievements in 2021	02
	Orion projects in South Africa and Australia	03
	Strategy	04
	2	LEADERSHIP	06
	Chairman and Managing Director/ CEO Review
	Board of directors	10
	Senior management	12
	3	BUSINESS REVIEW	14
	Health and Safety
	Environmental, Social & Governance	14
	Corporate social responsibility	15

Review of Operations

SOUTH AFRICA

Prieska Copper Zinc-Mine Development & Exploration

Okiep Copper Project

Regional Exploration

AUSTRALIA

Corporate

Ore reserve and mineral resource statement

19

24

33

40

41

45

FINANCIAL STATEMENTS

4	Directors' report	54
Auditor's independence declaration	73
Consolidated statement of profit or loss and other	74
	comprehensive income
	Consolidated statement of financial position	75
	Consolidated statement of cash flows	76
	Consolidated statement of changes in equity	77
	Notes to financial statements	78
	Directors' declaration	112
	Independent auditor's report	113
	Additional ASX information	117

ORION MINERALS ANNUAL REPORT 2021

01

1

CORPORATE

PROFILE

VALUES

TRANSFORMATIVE

as an ethical agent and catalyst for beneficial change in society, in the economic and social wellbeing and in the health and safety of our people and host communities;

RESILIENT

persistently committed to achieving the goals of our business, anticipating and facing disruption and challenges, whilst embracing change and adaptability as tools of success;

AGILE

continually committed to proactively and responsively understanding and addressing the goals of our business and stakeholders, nimbly and flexibly recognising and harnessing opportunity and addressing expectations and challenges;

INNOVATIVE

continually seeking to adapt, innovate and improve the way we conduct our business, embracing and expanding on good practices, whilst building and maintaining an industry leadership role across all facets of our business; and

SUSTAINABLE

striving for ethical business excellence and exceptional success, realistically ambitious in meeting the goals of the business and stakeholders through a balanced approach to business/ economic, environmental, and social aspects, and embracing a culture of good governance.

KEY ACHIEVEMENTS IN 2021

SIGNIFICANTLY ADVANCED OUR FLAGSHIP PRIESKA COPPER-ZINC PROJECT:

Development-ready project, targeting an initial 12-year, 2.4Mtpa operation producing 22ktpa copper and 70ktpa zinc at globally competitive costs, with strong operating margins and outstanding financial returns

Fully-permitted, with approval of the Mining Right, receipt of Environmental Consent notices and grant of the Water Use Licence in place

Significantly advanced discussions with potential project financiers,

Advanced pre-development work streams and initial site activities

SECURED THE ACQUISITION AND CONSOLIDATION OF THE OKIEP COPPER PROJECT:

Outstanding opportunity to develop a second major base metals production hub in the Northern Cape Province, alongside Prieska

In just six months, Orion successfully completed scoping and extensive due diligence studies, as well as major greenfield and brownfield exploration surveys

Maiden JORC 2012 compliant Mineral

Resources defined

Drilling commenced in September 2021 at the high-priority BCC Prospecting Right

Intensive exploration program underway to verify historical near-surface drill results and progress studies for the development of a proof-of-concept scale mining operation

STRONGLY-SUPPORTED AUD25 MILLION CAPITAL RAISING COMPLETED TO FAST-TRACK THE COMPANY'S STRATEGY OF DEVELOPING TWO SIGNIFICANT LONG-TERM BASE METAL PRODUCTION CENTRES IN SOUTH AFRICA'S NORTHERN CAPE PROVINCE.

02	ORION MINERALS ANNUAL REPORT 2021

MISSION

	A	B	C	D	E
	Build a high quality	Generate superior	Exercise high	Create an inspiring	Be welcomed in
	and sustainable	returns for	standards of ethical	workplace.	all communities in
	minerals exploration,	shareholders.	conduct when		which the Company
	development		dealing with all		operates.
	and production		stakeholders.
	company.

ORION PROJECTS IN SOUTH AFRICA

AND AUSTRALIA

PROJECT LOCATIONS

SPRINGBOK
OCP	PRIESKA
PROJECT	PROJECT

COMMODITY FOCUS

New Era base metals with multiple Cu-Zn,Cu-Au and Ni-Cu-Co-PGM-Au targets in the Northern Cape Province, South Africa

SOUTH AFRICA

FRASER RANGE PROJECT:

WESTERN AUSTRALIA

AUSTRALIA

SOUTH AFRICAN OFFICES:

JOHANNESBURG, GAUTENG

PRIESKA PROJECT, NORTHERN CAPE

TOTAL MINERAL RESOURCE OF 30.49MT @ 1.2% CU AND 3.7% ZN

	OKIEP COPPER PROJECT, NORTHERN CAPE
AUSTRALIA HEAD OFFICE:
	TOTAL MINERAL RESOURCE OF
	11.5MT @ 1.4% CU	MELBOURNE, VICTORIA

ORION MINERALS ANNUAL REPORT 2021

03