TIDMPDZ
RNS Number : 0193W
Prairie Mining Limited
12 April 2019
PRAIRIE MINING LIMITED
NEWS RELEASE | 12 April 2019
MARCH 2019 QUARTERLY REPORT
Highlights during, and subsequent to the quarter end:
Possible Prairie and JSW Co-Operation
-- Following JSW's due diligence at both Jan Karski and
Debiensko, Prairie and JSW signed an extension to a non-disclosure
agreement during the quarter in order to discuss a deal structure
and commercial terms for any co-operation or transaction and for
the adaption of mine plans for both Debiensko and Jan Karski to
align with JSW's development concepts to maximise potential
synergies using JSW's current infrastructure.
-- JSW estimates such synergies could potentially enable
production within 18 months from all relevant permits and
concession amendments being granted.
-- Discussions between Prairie and JSW have been ongoing with
JSW reporting that it would like to agree the basic terms of a
potential transaction with Prairie by the end of April 2019.
-- There can be no certainty as to whether any transaction(s)
will be agreed, or the potential form of such transaction(s). The
Company will continue to comply with its continuous disclosure
obligations and will make announcements to the market as
required.
Debiensko Mine
-- In December 2016, following the acquisition of Debiensko,
Prairie applied to the Ministry of Environment ("MoE") to amend the
50-year Debiensko mining concession to extend the time stipulated
in the mining concession for first production of coal from 2018 to
2025. In January 2019, Prairie received a final "second instance"
decision from the MoE that has denied the amendment application
which the Company believes is fundamentally flawed, fails to comply
with Polish, EU and international law, and demonstrates yet further
evidence of the discriminatory treatment faced by Prairie as a
foreign investor in Poland.
-- The 50-year Debiensko mining concession remains in place and
Prairie will strongly defend its position and continue to take all
relevant actions to pursue its legal rights regarding the Debiensko
concession amendment, which includes an appeal that has been filed
with Poland's Administrative Court.
Jan Karski Mine
-- During the quarter, Poland's Supreme Administrative Court
finally and fully rejected Bogdanka's administrative complaints
against the MoE regarding the refusal of Bogdanka's 2013
application for a mining concession over the K-6-7 deposit at Jan
Karski.
-- The Supreme Administrative Court has also upheld the 2016
Regional Administrative Court decision that obliged the MoE to
approve Prairie's Addendum No.3 for the K-6-7 deposit. Addendum
No.3 is a detailed resource estimate for the K-6-7 deposit
according to Polish geological reporting standards and is based on
the results of Prairie's exploration program at the deposit.
-- Subsequent to the quarter end, an Appeal Court in Warsaw
overturned the Civil Court's injunction that was previously awarded
in Prairie's favour preventing the MoE from granting a mining
usufruct or exploration/mining concession to another party except
Prairie. Prairie believes that the Appeal Court's decision is
fundamentally flawed and will therefore consider all other actions
necessary to ensure its rights are preserved.
-- The Company's mining usufruct agreement proceedings for Jan
Karski in front of the Civil Court remain ongoing and is not
impacted by the Appeal Court's decision to lift the injunction.
Corporate
-- Prairie remains in a financially strong position with cash reserves of A$8.0 million on hand.
-- In February 2019, the Company formally notified the Polish
Government that there exists an investment dispute between Prairie
and the Government that has arisen out of certain measures taken by
Poland in breach of the Energy Charter Treaty, the UK-Poland
Bilateral Investment Treaty and the Australia-Poland Bilateral
Investment Treaty.
For further information, please contact:
Prairie Mining Limited +44 20 7478 3900
Ben Stoikovich, Chief Executive info@pdz.com.au
Officer
Sapan Ghai, Head of Corporate
Development
Debiensko MINE
The Debiensko Mine ("Debiensko") is a permitted, hard coking
coal project located in the Upper Silesian Coal Basin in the south
west of the Republic of Poland. It is approximately 40 km from the
city of Katowice and 40 km from the Czech Republic.
Debiensko is bordered by the Knurow-Szczyglowice Mine in the
north west and the Budryk Mine in the north east, both owned and
operated by Jastrz bska SpĆ³ ka W glowa SA ("JSW"), Europe's leading
producer of hard coking coal.
The Debiensko mine was originally opened in 1898 and was
operated by various Polish mining companies until 2000 when mining
operations were terminated due to a major government led
restructuring of the coal sector caused by a downturn in global
coal prices. In early 2006 New World Resources Plc ("NWR") acquired
Debiensko and commenced planning for Debiensko to comply with
Polish mining standards, with the aim of accessing and mining hard
coking coal seams. In 2008, the Ministry of Environment ("MoE")
granted a 50-year mining concession for Debiensko.
In October 2016, Prairie Mining Limited ("Prairie" or "Company")
acquired Debiensko with a view that a revised development approach
would potentially allow for the early mining of profitable premium
hard coking coal seams, whilst minimising upfront capital costs.
Prairie has proven expertise in defining commercially robust
projects and applying international standards in Poland. The fact
that Debiensko is a former operating mine and its proximity to two
neighbouring coking coal producers in the same geological setting,
reaffirms the significant potential to successfully bring Debiensko
back into operation.
Update on Concession Amendment Application
In December 2016, following the acquisition of Debiensko,
Prairie applied to the MoE to amend the 50-year Debiensko mining
concession.
The purpose of the concession amendment was to extend the time
stipulated in the mining concession for first production of coal
from 2018 to 2025. Prairie has now received a final "second
instance" decision from the MoE that has denied the Company's
amendment application. Not meeting the production timeframe
stipulated in the concession does not automatically infringe on the
validity and expiry date of the Debiensko mining concession, which
is June 2058. Prairie also holds a valid environmental consent
decision enabling mine construction and continues to have valid
tenure and ownership of land at Debiensko. However, the concession
authority now has the right to request the concession holder to
remove any infringements related to non-compliance with the
conditions of the mining concession and determine a reasonable date
for removal of the infringements. In accordance with Polish law,
the concession authority is required to provide an achievable and
reasonable timeframe to remedy any non-compliance taking into
account the nature of the non-compliance. Nevertheless, the second
instance decision may result in the commencement of proceedings by
the MoE to limit or withdraw the Debiensko mining concession.
Prairie will strongly defend its position and continue to take
relevant actions to pursue its legal rights regarding the Debiensko
concession, which includes an appeal that has been filed with
Poland's Administrative Court.
JAN KARSKI MINE
The Jan Karski Mine ("Jan Karski") is a large scale semi-soft
coking coal project located in the Lublin Coal Basin in south east
Poland. The Lublin Coal Basin is an established coal producing
province which is well serviced by modern and highly efficient
infrastructure, offering the potential for low capital intensity
mine development. Jan Karski is situated adjacent to Lubelski W
giel BOGDANKA S.A.'s ("Bogdanka") Bogdanka coal mine which has been
in commercial production since 1982 and is the lowest cost hard
coal producer in Europe.
Prairie's use of modern exploration techniques continues to
transform Jan Karski with latest drill results re-affriming the
capability of the the project to produce high value ultra-low ash
semi-soft coking coal ("SSCC"), known as Type 34 coal in Poland
whilst confirming Jan Karski as a globally significant SSCC / Type
34 coking coal deposit with the potential to produce a high value
ultra-low ash SSCC with a coking coal product split of up to
75%.
Key benefits for the local community and the Lublin and Chelm
regions associated with the development, construction and operation
of Jan Karski have been recognised as the following:
-- creation of 2,000 direct employment positions and 10,000
indirect jobs for the region once operational;
-- increasing skills of the workforce and through the
implementation of International Standard training programmes;
-- stimulating the development of education, health services and
communications within the region; and
-- building a mine that creates new employment for generations
to come and career paths for families to remain in the region.
Positive Rulings in Supreme Administrative Court
Poland's Supreme Administrative Court has finally and fully
rejected Bogdanka's administrative complaints against Poland's MoE
regarding the refusal of Bogdanka's 2013 application for a mining
concession over the K-6-7 deposit at Jan Karski.
This Supreme Administrative Court decision is final, cannot be
appealed and has upheld the 2016 Regional Administrative Court
decision that confirms the original 2015 decision, which denied
Bogdanka's mining concession application. It has been concluded
that granting a mining concession to Bogdanka would be a serious
violation of the provisions of Poland's Geological and Mining Law
("GML"), and would be contrary to the rule of law as embodied in
the Polish constitution.
In a second ruling, the Supreme Administrative Court has upheld
the 2016 Regional Administrative Court decision that obliged the
MoE to approve Prairie's submitted Addendum No.3 for the K-6-7
deposit. Addendum No.3 is a detailed resource estimate for the
K-6-7 deposit according to Polish geological reporting standards
and is based on the results of Prairie's exploration program at the
deposit. This complaint was bought against the MoE by Prairie in
2015.
The Court's ruling will now be passed back to the MoE, and the
MoE is meant to promptly reassess the original decision taking into
account the court's verdict.
The Supreme Administrative Court's rulings re-affirm, beyond
doubt, that Bogdanka's 2013 claims over K-6-7 are without merit and
inadmissible. The Board notes that Bogdanka's claims have been
rejected by the Polish courts in multiple rulings.
Injunction against Poland's Ministry of Environment has been
Over-turned
In April 2018, Prairie filed a civil law claim against the MoE
due to its failure to grant Prairie a mining usufruct agreement
over the Jan Karski concessions in order to protect the Company's
security of tenure over the project.
The Company had been awarded the Priority Right to apply for a
mining concession at Jan Karski in 2015 following its full
compliance with Poland's Geological and Mining Law (2011).
Subsequent to Prairie's filing of the civil law claim discussed
above, the Polish Civil Court granted Prairie an injunction
preventing the MoE from granting prospecting, exploration or mining
concessions and concluding usufruct agreements with any other party
until full court proceedings were concluded.
In its ruling, the Court stated that: "Based on the evidence one
may at this point state that the plaintiff [Prairie] enjoys the
right to request conclusion of the requested mining usufruct
agreement for the 'Lublin' hard coal area (otherwise known as Jan
Karski) resulting from Article 15 of the Geological and Mining Law
[2011]."
An Appeal Court in Warsaw has now overturned the Civil Court's
decision and lifted the injunction. Prairie believes that the
Appeal Court's decision is fundamentally flawed as it has the
effect of retrospectively applying the August 2018 amended version
of the Geological and Mining Law and (incorrectly) concludes that
Prairie did not have a Priority Right over the entire Lublin
deposit.
Prairie's civil law claim against the MoE for failure to grant
the Company with a mining usufruct agreement at Jan Karski remains
ongoing and is not impacted by the Appeal Court's decision to lift
the injunction.
The Appeal Court's decision is further evidence of the unfair
and inequitable treatment faced by Prairie as a foreign investor in
Poland and the Company will therefore consider all other actions
necessary to ensure its rights are preserved.
CORPORATE
Possible Co-Operation between Prairie and JSW
Discussions continued throughout the quarter and remain ongoing
between Prairie and JSW with JSW reporting that it would like to
agree the basic terms of a potential transaction with Prairie by
the end of April 2019.
JSW has stated that due diligence at Debiensko has indicated the
technical feasibility and potential synergies of accessing initial
seams at the Debiensko deposit utilising the existing
infrastructure at JSW's adjacent Knurow-Szczyglowice mine.
Exploiting those synergies would require modifications to project
configuration and obtaining relevant approvals, including
concession modifications. JSW estimates that access via the
Szczyglowice mine potentially enables the production of hard coking
coal (Type 35) from Debiensko in up to 18 months from the time that
relevant administrative permits and concession amendments are
granted.
JSW's due diligence process at Jan Karski has also confirmed
that part of the "Lublin" deposit contains semi-soft coking coal
(Type 34), which can be potentially utilised by JSW.
During the quarter, Prairie and JSW signed an extension to an
Non-Disclosure Agreement ("NDA"), with the term of the NDA now
ending on 28 September 2019, in order to discuss a deal structure
and commercial terms for any co-operation or transaction and for
the adaption of mine plans for both Debiensko and Jan Karski to
align with JSW's development concepts and to maximise potential
synergies at Debiensko.
There can be no certainty as to whether any transaction(s) or
co-operation will be agreed, or the potential form of such
transaction(s) or co-operation. It is emphasised that any potential
transaction(s), should they occur, may be subject to a number of
conditions including, but not limited to, obtaining necessary
corporate approvals, consents and approvals related to funding,
consents from Poland's Office of Competition and Consumer
Protection (UOKiK) if required, and any other requirements that may
relate to the strategy, objectives and regulatory regimes
applicable to the respective issuers.
Dispute with the Polish Government
Prairie has formally notified the Polish government that there
exists an investment dispute between Prairie and the Polish
government.
Prairie's notification calls for prompt negotiations with the
government to amicably resolve the dispute, and indicates Prairie's
right to submit the dispute to international arbitration in the
event the dispute is not resolved amicably. The dispute arises out
of certain measures taken by Poland in breach of the Energy Charter
Treaty, the UK-Poland Bilateral Investment Treaty and
Australia-Poland Bilateral Investment Treaty.
The Company advises that it is not in a position to comment on
the potential size of the claim that may be made against the Polish
government should the dispute not be resolved amicably. Prairie
will update the market when it is in a position to do so.
Prairie can confirm that it is taking all necessary actions to
preserve its rights and protect its investments in Poland. The
Company remains hopeful that the dispute with the Polish government
can be resolved amicably. The Company will consider any other
actions necessary to ensure its rights are preserved.
Prairie will continue to update the market in relation to this
matter as required.
Financial Position and Balance Sheet
Prairie has cash reserves of A$8.0 million and CD Capital's
right to invest a further A$68 million as a cornerstone
investor.
Issue of Performance Rights and remuneration of Chief Executive
Officer
The Company has issued 1,325,000 Performance Rights (expiring 30
September 2020) to key employees and consultants of the Company
pursuant to the Company's Performance Rights Plan today as an
incentive for them to achieve the business strategies and prospects
of the Company as stated below.
No new Ordinary Shares have been issued. The figure of
212,275,089 Ordinary Shares can be continued to be used by
shareholders as the denominator for the calculations by which they
will determine if they are required to notify their interest in, or
a change to their interest in, the share capital of the Company,
under the FCA's Disclosure and Transparency Rules.
The Board has also resolved to update the remuneration package
of Mr Ben Stoikovich, Director and Chief Executive Officer of the
Company, and Selwyn Capital Limited (a Company Mr Stoikovich is a
director and shareholder of) to provide an incentive for Mr
Stoikovich and Selwyn Capital Limited to achieve the long-term
business strategies and prospects of the Company which includes a
potential co-operation transaction between Prairie and JSW.
This updated remuneration includes, subject to shareholder
approval, the award of 500,000 Performance Rights to Selwyn Capital
Limited which vest subsequent to securing a new strategic investor
(expiring 30 September 2020).
Subject to shareholder approval, the Company will also amend the
change of control clause in the Selwyn Capital Limited consulting
contract to be consistent with the Company's shareholder approved
Performance Rights Plan and to appropriately incentivise Mr
Stoikovich and Selwyn Capital Limited to achieve the long-term
business strategies and prospects of the Company. The amendment
will mean that the change of control clause is triggered when any
person acquires a relevant interest in 50.1% or more shares in the
Company by any other means.
Forward Looking Statements
This release may include forward-looking statements. These
forward-looking statements are based on Prairie's expectations and
beliefs concerning future events. Forward looking statements are
necessarily subject to risks, uncertainties and other factors, many
of which are outside the control of Prairie, which could cause
actual results to differ materially from such statements. Prairie
makes no undertaking to subsequently update or revise the
forward-looking statements made in this release, to reflect the
circumstances or events after the date of that release.
Competent Person Statements
The information in this announcement that relates to Exploration
Results was extracted from Prairie's announcement dated 21 February
2018 entitled "Drill Results Affirm Jan Karski's Status as a
Globally Significant Semi-Soft (Type 34) Coking Coal Project". The
information in the original announcement is based on, and fairly
represents information compiled or reviewed by Mr Jonathan O'Dell,
a Competent Person who is a Member of The Australasian Institute of
Mining and Metallurgy. Mr O'Dell is a part time consultant of the
Company. Mr O'Dell has sufficient experience that is relevant to
the style of mineralisation and type of deposit under consideration
and to the activity which he is undertaking 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'. Prairie confirms that: a) it is not
aware of any new information or data that materially affects the
information included in the original announcements; b) all material
assumptions and technical parameters included in the original
announcements continue to apply and have not materially changed;
and c) the form and context in
which the relevant Competent Persons' findings are presented in
this presentation have not been materially modified from the
original announcements.
APPIX 1 - EXPLORATION TENEMENT INFORMATION
As at 31 March 2019, the Company has an interest in the
following tenements:
Location Tenement Percentage Interest Status Tenement Type
------------------- ------------------------------- -------------------- -------- --------------------------------
Jan Karski, Poland Jan Karski Mine Plan Area 100 Granted Exclusive Right to apply for a
(K-4-5, K-6-7, K-8 and K-9)* mining concession*
Debiensko, Poland Debiensko 1** 100 Granted Mining
Debiensko, Poland Kaczyce 1 100 Granted Mining & Exploration (includes
gas rights)
------------------- ------------------------------- -------------------- -------- --------------------------------
* In July 2015, Prairie announced that it had secured the
Exclusive Right to apply for a Mining Concession for Jan Karski as
a result of its Geological Documentation for the Jan Karski deposit
being approved by Poland's MoE. The approved Geological
Documentation covers areas of all four original Exploration
Concessions granted to Prairie (K-4-5, K-6-7, K-8 and K-9) and
includes the full extent of the targeted resources within the mine
plan for Jan Karski. The K-4-5, K-8 and K-9 Exploration Concessions
expired in November 2018 but these were separate to and had no
bearing on the Company's access to land and the Exclusive Right
(tenure) to apply for a mining concession at Jan Karski, however as
noted below, this position is the subject of Prairie's Mining
Usufruct Agreement proceedings in front of the Civil Court. As a
result of the Exclusive Right, Prairie was the only entity with a
legal right to lodge a Mining Concession application over Jan
Karski for the period up and until 2 April 2018. Under the Polish
GML, a Mining Concession application comprises the submission of a
Deposit Development Plan ("DDP"), approval of a spatial development
plan (rezoning of land for mining use) and an Environmental Consent
decision. Prairie has previously announced that the DDP and spatial
development plans for Jan Karski have already been approved.
However, as of the date of this report, Prairie has not yet
received the required Environmental Consent decision, which remains
pending. Prairie completed an Environmental and Social Impact
Assessment and made submissions to RDOS for an Environmental
Consent decision in October 2017. Prairie has not been able to
apply for a Mining Concession for Jan Karski due to the delay in
the issuance of an Environmental Consent decision. However, the
Environmental Consent proceedings continue to progress and the
Company has provided to RDOS supplementary information to the
originally submitted Environmental & Social Impact Assessment,
as requested by RDOS.
The approval of Prairie's Geological Documentation in 2015 also
conferred upon Prairie the legal right to apply for a Mining
Usufruct Agreement over Jan Karski for an additional 12-month
period beyond April 2018, which precludes any other parties being
granted any licence over all or part of the Jan Karski concessions.
Under Polish law, the MoE is strictly obligated, within three
months of Prairie making an application for a Mining Usufruct
Agreement, to grant the agreement. It should be noted that the MoE
confirmed Prairie's priority right in two written statements (i.e.
in a final administrative decision dated 11 February 2016 and in a
formal letter dated 13 April 2016). Prairie applied to the MoE for
a Mining Usufruct Agreement over Jan Karski in late December 2017.
As of the date of this report the MoE has not made available to
Prairie a Mining Usufruct Agreement for Jan Karski, therefore
breaching the three-month obligatory period for the agreement to be
concluded. Advice provided to Prairie concludes that failure of the
MoE to grant Prairie the Mining Usufruct Agreement is a breach of
Polish law. Accordingly, the Company commenced legal proceedings,
which remain ongoing, against the MoE through the Polish courts in
order to protect the Company's security of tenure over the Jan
Karski concessions. Since the MoE has not provided a decision
within three months regarding Prairie's Mining Usufruct Agreement
application, the Polish civil court has the power to enforce
conclusion of a Usufruct Agreement in place of the MoE. In the
event that a Mining Usufruct Agreement is not made available to the
Company on acceptable terms or the Company does not enter into a
Mining Usufruct Agreement for any other reason, other parties may
be able to apply for exploration or mining rights for all or part
of the Jan Karski concession area. In April 2018, the Civil Court
approved Prairie's motion for an injunction against the MoE, which
prevented them from entering into a usufruct agreement or a
concession with any other party besides Prairie. A decision by an
Appeal Court in Warsaw has now overturned the injunction in place
against the MoE. Prairie believes that the Appeal Court's decision
is fundamentally flawed and will therefore consider all other
actions necessary to ensure its rights are preserved. The Company's
Mining Usufruct Agreement proceedings in front of the Civil Court
for Jan Karski remain ongoing and is not impacted by the Appeal
Court's decision to lift the injunction.
** Under the terms of the Debiensko Mining Concession issued in
2008 by the MoE (which is valid for 50 years from grant date),
commencement of production was to occur by 1 January 2018. In
December 2016, following the acquisition of Debiensko, Prairie
applied to the MoE to amend the 50 year Debiensko Mining
Concession. The purpose of the concession amendment was to extend
the time stipulated in the Mining Concession for first production
of coal from 2018 to 2025. Prairie has now received a final "second
instance" decision from the MoE that has denied the Company's
amendment application. However, Prairie also holds a valid
environmental consent decision enabling mine construction and
continues to have valid tenure and ownership of land at Debiensko.
Not meeting the production timeframe stipulated in the concession
does not automatically infringe on the validity and expiry date of
the Debiensko mining concession, which is June 2058. However, the
concession authority now has the right to request the concession
holder to remove any infringements related to non-compliance with
the conditions of the mining concession and determine a reasonable
date for removal of the infringements. In accordance with Polish
law, the concession authority is required to provide an achievable
and reasonable timeframe to remedy any non-compliance taking into
account the nature of the non-compliance. Nevertheless, the second
instance decision may result in the commencement of proceedings by
the MoE to limit or withdraw the Debiensko mining concession.
Prairie will strongly defend its position and continue to take
relevant actions to pursue its legal rights regarding the Debiensko
concession. In this regard Karbonia, Prairie's wholly owned Polish
subsidiary has also filed an appeal to Poland's administrative
courts following advice that the MoE's decision is fundamentally
flawed, fails to comply with Polish, EU and international law, and
demonstrates yet further evidence of the discriminatory treatment
faced by Prairie as a foreign investor in Poland. The Company will
consider any other actions necessary to ensure its concession
rights are preserved. For this and other reasons, Prairie has
formally notified the Polish government that there exists an
investment dispute between Prairie and the Polish Government. The
dispute arises out of certain measures taken by Poland in breach of
the Energy Charter Treaty, the UK-Poland Bilateral Investment
Treaty and the Australia-Poland Bilateral Investment Treaty.
Prairie's notification calls for prompt negotiations with the
government to amicably resolve the dispute, and indicates Prairie's
right to submit the dispute and lodge a claim to international
arbitration in the event the dispute is not resolved amicably.
+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
-----------------------------------------------------
PRAIRIE MINING LIMITED
ABN Quarter ended ("current quarter")
--------------- ----------------------------------
23 008 677 852 31 March 2019
----------------------------------
Consolidated statement of cash Current quarter Year to date
flows $A'000
(9 months)
$A'000
1. Cash flows from operating
activities
1.1 Receipts from customers - -
1.2 Payments for
(a) exploration & evaluation (567) (2,020)
(b) development - -
(c) production - -
(d) staff costs (261) (896)
(e) administration and corporate
costs (202) (701)
1.3 Dividends received (see note - -
3)
1.4 Interest received 52 174
1.5 Interest and other costs of - -
finance paid
1.6 Income taxes paid - -
1.7 Research and development refunds - -
Other (provide details if
1.8 material) (42) (134)
(a) Business development costs 152 331
(b) Property rental and gas
sales
---------------- -------------
Net cash from / (used in)
1.9 operating activities (868) (3,246)
----- ------------------------------------- ---------------- -------------
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 - -
(b) tenements (see item 10) - -
(c) investments - -
(d) other non-current assets 3 3
2.3 Cash flows from loans to - -
other entities
2.4 Dividends received (see note - -
3)
2.5 Other (provide details if - -
material)
---------------- -------------
Net cash from / (used in)
2.6 investing activities 3 3
------- ----------------------------------- ---------------- -------------
3. Cash flows from financing
activities
3.1 Proceeds from issues of shares - -
3.2 Proceeds from issue of convertible - -
notes
3.3 Proceeds from exercise of - -
share options
Transaction costs related
to issues of shares, convertible
3.4 notes or options (3) (70)
3.5 Proceeds from borrowings - -
3.6 Repayment of borrowings - -
3.7 Transaction costs related - -
to loans and borrowings
3.8 Dividends paid - -
3.9 Other (provide details if - -
material)
---------------- -------------
Net cash from / (used in)
3.10 financing activities (3) (70)
------- ----------------------------------- ---------------- -------------
4. Net increase / (decrease)
in cash and cash equivalents
for the period
Cash and cash equivalents
4.1 at beginning of period 8,572 11,016
Net cash from / (used in)
operating activities (item
4.2 1.9 above) (868) (3,246)
Net cash from / (used in)
investing activities (item
4.3 2.6 above) 3 3
Net cash from / (used in)
financing activities (item
4.4 3.10 above) (3) (70)
Effect of movement in exchange
4.5 rates on cash held - 1
---------------- -------------
Cash and cash equivalents
4.6 at end of period 7,704 7,704
------- ----------------------------------- ---------------- -------------
5. Reconciliation of cash and Current quarter Previous quarter
cash equivalents $A'000 $A'000
at the end of the quarter
(as shown in the consolidated
statement of cash flows) to
the related items in the accounts
5.1 Bank balances 1,704 1,572
5.2 Call deposits 6,000 7,000
5.3 Bank overdrafts - -
5.4 Other (provide details) - -
---------------------------- -----------------
Cash and cash equivalents
at end of quarter (should
5.5 equal item 4.6 above) 7,704 8,572
---- ----------------------------------- ---------------------------- -----------------
6. Payments to directors of the entity and Current quarter
their associates $A'000
Aggregate amount of payments to these parties
6.1 included in item 1.2 (185)
----------------
6.2 Aggregate amount of cash flow from loans Nil
to these parties included in item 2.3
----------------
6.3 Include below any explanation necessary to understand
the transactions included in items 6.1 and 6.2
----- -----------------------------------------------------------------
Payments include executive remuneration (including bonuses),
director fees, superannuation and provision of a fully serviced
office.
7. Payments to related entities of the entity Current quarter
and their associates $A'000
7.1 Aggregate amount of payments to these parties -
included in item 1.2
----------------
7.2 Aggregate amount of cash flow from loans -
to these parties included in item 2.3
----------------
7.3 Include below any explanation necessary to understand
the transactions included in items 7.1 and 7.2
---- ----------------------------------------------------------------
Not applicable
8. Financing facilities available Total facility Amount drawn
Add notes as necessary for amount at quarter at quarter end
an understanding of the position end $A'000
$A'000
8.1 Loan facilities - -
------------------- ----------------
8.2 Credit standby arrangements - -
------------------- ----------------
8.3 Other (please specify) - -
------------------- ----------------
8.4 Include below a description of each facility above, including
the lender, interest rate and whether it is secured or
unsecured. If any additional facilities have been entered
into or are proposed to be entered into after quarter
end, include details of those facilities as well.
---- -------------------------------------------------------------------------
9. Estimated cash outflows for next $A'000
quarter
9.1 Exploration and evaluation (500)
9.2 Development -
9.3 Production -
9.4 Staff costs (250)
9.5 Administration and corporate costs (200)
Other (provide details if material)
9.6 (a) Business development costs (50)
--------
9.7 Total estimated cash outflows (1,000)
---- ------------------------------------ --------
10. Changes in tenements Tenement reference Nature of Interest Interest
(items 2.1(b) and location interest at beginning at end
and 2.2(b) above) of quarter of quarter
10.1 Interests in Jan Karski
mining tenements See notes
and petroleum below
tenements lapsed,
relinquished
or reduced
----- --------------------- ------------------- ---------- -------------- ------------
10.2 Interests in - - - -
mining tenements
and petroleum
tenements acquired
or increased
----- --------------------- ------------------- ---------- -------------- ------------
Notes:
* In July 2015, Prairie announced that it had secured the
Exclusive Right to apply for a Mining Concession for Jan Karski as
a result of its Geological Documentation for the Jan Karski deposit
being approved by Poland's MoE. The approved Geological
Documentation covers areas of all four original Exploration
Concessions granted to Prairie (K-4-5, K-6-7, K-8 and K-9) and
includes the full extent of the targeted resources within the mine
plan for Jan Karski. (The K-4-5, K-8 and K-9 Exploration Concession
expired in November 2018 but this was separate to and had no
bearing on the access to land and the Exclusive Right (tenure) to
apply for a mining concession at Jan Karski). As a result of the
Exclusive Right, Prairie was the only entity with a legal right to
lodge a Mining Concession application over Jan Karski for the
period up and until 2 April 2018. Under the Polish GML, a Mining
Concession application comprises the submission of a Deposit
Development Plan ("DDP"), approval of a spatial development plan
(rezoning of land for mining use) and an Environmental Consent
decision. Prairie has previously announced that the DDP and spatial
development plans for Jan Karski have already been approved.
However, as of the date of this report, Prairie has not yet
received the required Environmental Consent decision, which remains
pending. Prairie completed an Environmental and Social Impact
Assessment and made submissions to RDOS for an Environmental
Consent decision in October 2017. Prairie has not been able to
apply for a Mining Concession for Jan Karski due to the delay in
the issuance of an Environmental Consent decision.
However, the Environmental Consent proceedings continue to
progress and the Company has provided to RDOS supplementary
information to the originally submitted Environmental & Social
Impact Assessment, as requested by RDOS.
The approval of Prairie's Geological Documentation in 2015 also
conferred upon Prairie the legal right to apply for a Mining
Usufruct Agreement over Jan Karski for an additional 12-month
period beyond April 2018, which precludes any other parties being
granted any licence over all or part of the Jan Karski concessions.
Under Polish law, the MoE is strictly obligated, within three
months of Prairie making an application for a Mining Usufruct
Agreement, to grant the agreement. It should be noted that the MoE
confirmed Prairie's priority right in two written statements (i.e.
in a final administrative decision dated 11 February 2016 and in a
formal letter dated 13 April 2016). Prairie applied to the MoE for
a Mining Usufruct Agreement over Jan Karski in late December 2017.
As of the date of this report the MoE has not made available to
Prairie a Mining Usufruct Agreement for Jan Karski, therefore
breaching the three-month obligatory period for the agreement to be
concluded. Advice provided to Prairie concludes that failure of the
MoE to grant Prairie the Mining Usufruct Agreement is a breach of
Polish law. Accordingly, the Company commenced legal proceedings,
which remain ongoing, against the MoE through the Polish courts in
order to protect the Company's security of tenure over the Jan
Karski concessions. Since the MoE has not provided a decision
within three months regarding Prairie's Mining Usufruct Agreement
application, the Polish civil court has the power to enforce
conclusion of a Usufruct Agreement in place of the MoE. In the
event that a Mining Usufruct Agreement is not made available to the
Company on acceptable terms or the Company does not enter into a
Mining Usufruct Agreement for any other reason, other parties may
be able to apply for exploration or mining rights for all or part
of the Jan Karski concession area. In April 2018, the Civil Court
approved Prairie's motion for an injunction against the MoE, which
prevented them from entering into a usufruct agreement or a
concession with any other party besides Prairie. A decision by an
Appeal Court in Warsaw has now overturned the injunction in place
against the MoE. Prairie believes that the Appeal Court's decision
is fundamentally flawed and will therefore consider all other
actions necessary to ensure its rights are preserved. The Company's
Mining Usufruct Agreement proceedings for Jan Karski remain ongoing
and is not impacted by the Appeal Court's decision to lift the
injunction.
Compliance statement
1 This statement has been prepared in accordance with accounting
standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters disclosed.
[lodged electronically without signature]
Sign here:
............................................................ Date:
12 April 2019
(Director/Company secretary)
Print name: Dylan Browne
Notes
1. The quarterly report provides a basis for informing the
market how the entity's activities have been financed for the past
quarter and the effect on its cash position. An entity that wishes
to disclose additional information is encouraged to do so, in a
note or notes included in or attached to this report.
2. If this quarterly report has been prepared in accordance with
Australian Accounting Standards, the definitions in, and provisions
of, AASB 6: Exploration for and Evaluation of Mineral Resources and
AASB 107: Statement of Cash Flows apply to this report. If this
quarterly report has been prepared in accordance with other
accounting standards agreed by ASX pursuant to Listing Rule 19.11A,
the corresponding equivalent standards apply to this report.
3. Dividends received may be classified either as cash flows
from operating activities or cash flows from investing activities,
depending on the accounting policy of the entity.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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