| Mon 27 Oct 2008, 10:47 | | FSE - Firestone Energy Limited - Abridged Pre-Listing Statement |
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FSE - Firestone Energy Limited - Abridged Pre-Listing Statement
FIRESTONE ENERGY LIMITED
(formerly: Centralian Minerals Limited)
(Incorporated in Australia)
(Registration number ABN 058 436 794)
Share code on the JSE Limited: FSE & Share code on the ASX: FSE
ISIN: AU000000FSE6
(SA company registration number 2008/023973/10)
("FSE" or "the Company")
ABRIDGED PRE-LISTING STATEMENT
1. INTRODUCTION
The FSE shares are presently listed on the Australian Securities
Exchange ("ASX"). The JSE Limited ("JSE") has formally approved the
secondary listing of FSE on the General Mining Sector of the JSE from
the commencement of trade on Thursday, 30 October 2008. The shares
will trade under the abbreviated name "Firestone", with share code
"FSE" and ISIN: AU000000FSE6. FSE is an Australian company whose
objectives are to source and develop viable mineral projects.
FSE identifies and evaluates potential mineral exploration and mining
projects principally located in Africa.
2. INCORPORATION AND HISTORY OF FSE
FSE is an Australian company registered under the Corporations Act
2001 in Western Australia on 11 January 1993 as Giants Reef Mining
N.L.. FSE listed on the ASX on 24 June 1993 and changed its name to
Centralian Minerals Limited and then to Firestone Energy Limited on 18
December 2007. FSE was registered as an external company in South
Africa on 13 October 2008.
3. NATURE OF BUSINESS
FSE identifies and evaluates potential mineral exploration and mining
projects principally located in Africa, which it then develops into
mines. FSE`s objectives, as an exploration company, are to source and
develop viable mineral projects. Following an internal review of the
coal fields of South Africa, FSE has recently secured, through a joint
venture, near surface, open castable, coal in the Waterberg coal
field.
FSE`s assets and operations over the years have comprised an extensive
portfolio of exploration and mining tenements, principally for gold in
the Tennant Creek region of Northern Territory, Australia.
4. PROSPECTS OF THE FSE GROUP
4.1 Set out below is, in the opinion of the directors of FSE, the
prospects of the business of FSE:
It is the intention of FSE to actively pursue, principally
throughout South East Asia, China and Southern Africa, any
opportunity to fulfill its mandate, namely: the exploration and
mining of precious metals, base metals, and energy minerals. FSE
is actively exploring several tenements in the Northern
Territory, Australia, that are prospective for gold. Over the
last 18 months FSE has conducted a number of due diligence
studies on coal opportunities in the Witbank, Highveld, Ermelo
and Klip River coal fields of South Africa, some of which reached
advanced discussions and were reported to its shareholders
through the ASX. Following a recent internal review of the coal
fields of South Africa, FSE has focused its efforts towards
securing near surface, open castable, coal in the Waterberg coal
field with the intention to pursue both the production of semi-
soft coking coal for the domestic and export markets, and steam
coal suitable for the domestic market wherein FSE wishes to
establish itself as an Independent Power Producer ("IPP")
delivering electricity into the South African grid. To this end
FSE and Sekoko Coal (Pty) Ltd ("Sekoko Coal") have recently
announced, in Australia, a joint venture ("joint venture") over
two properties in the Waterberg ("Waterberg Properties") that
contain a minimum 500Mt of near surface coal product. It is the
intention of the joint venture to complete a bankable feasibility
study ("BFS") to mine and beneficiate coal, and to establish an
IPP using coal from the Waterberg Properties. Refer to paragraph
4.2 below for details of this transaction.
4.2 Summary of the joint venture:
FSE, through Checkered Flag Investments 2 (Pty) Ltd ("Checkered
Flag"), have entered into a joint venture agreement ("joint
venture agreement") dated 12 June 2008 and an addendum thereto
dated 24 July 2008, which can be summarised as follows:
- the vendors: Sekoko Coal (Pty) Ltd, Sekoko Resources (Pty)
Ltd and Uzalile Property Services (Pty) Ltd (collectively
"the vendors") will contribute the prospecting right granted
to Sekoko Coal over the farm Olieboomsfontein and the
prospecting right granted to a joint venture between Sekoko
Resources (Pty) Ltd ("Sekoko Resources") and Uzalile over
the farm Vetleegte (collectively "the Waterberg Prospecting
Rights");
- Checkered Flag will conduct a BFS study to determine whether
or not the commercial exploitation of the Waterberg
Prospecting Rights are feasible;
- Checkered Flag`s participation interest in the joint venture
will commence at 30% and ratchet up by 5% for every R10 000
000 expended on the BFS, provided that Checkered Flag`s
participation interest shall never exceed 55%;
- Checkered Flag will make a cash payment of R12 500 000 to
Sekoko Coal or its nominee within 5 days of fulfillment of
the last of the suspensive conditions to the joint venture
agreement; and
- subject to the approval of the secondary listing of FSE on
the JSE, -FSE will issue to the vendors 220 000 000 fully
paid ordinary shares at an issue price of A$0,04 per share
amounting to A$8 800 000 and options to acquire a further
110 000 000 fully paid ordinary shares at A$0,06 per share
at any time on or before 31 May 2013.
The joint venture will result in the establishment of a leading growth-
focused African coal explorer that will benefit from Sekoko Resources`
key landholdings and infrastructure in proven coal bearing regions in
South Africa. The joint venture is intended to provide FSE with
greater access to global capital markets and increased liquidity in
these markets. The joint venture also intends to accelerate growth by
capitalising on the strengths of each of FSE`s and the vendors` vast
businesses in exploration and development of coal projects including,
as a result of the strengths of FSE`s geological team and from an
operational standpoint, FSE`s production expertise in putting
exploration projects into production.
Following the fulfillment of all the suspensive conditions to the
joint venture agreement the board of FSE will be expanded through the
appointment by the vendors of two additional directors.
5. DIRECTORS
The full names, age and addresses of the directors of FSE are set out
below:
Director Age Business address
Edwin Leith Boyd - non-executive 60 Level 1, 34 Bagot
Road, SUBIACO, WA,
Australia, 6008
Daryl John Henthorn - non-executive 46 Level 1, 34 Bagot
Road, SUBIACO, WA,
Australia, 6008
Malcolm Keith Smartt - non-executive 60 Level 1, 34 Bagot
Road, SUBIACO, WA,
Australia, 6008
6. REASON FOR LISTING FSE ON THE JSE
The reasons for the listing of FSE on the JSE are as follows:
- on 14 September 2004 the SARB announced that non-South
African companies can apply for a secondary listing of their
shares on the JSE and use such shares as acquisition
currency for South African assets, subject to the approval
of the SARB. The listing of FSE`s shares on the JSE provides
a mechanism for acquisitions;
- being listed on the JSE, a non-South African company can
raise capital from South African investors, which provides
FSE with an additional market through which the efficient
funding of FSE`s South African projects ("Projects") and
other African exploration and acquisition opportunities may
be facilitated;
- to assist in the execution of any additional BEE
transactions that may present themselves as opportunities to
FSE, thus enabling FSE to further enhance its BEE status and
credibility; and
- to afford South African resident employees and institutional
investors the opportunity to participate directly in the
equity and future growth of FSE.
7. BEE STATUS
FSE has no BEE status.
Sekoko Resources, through the joint venture, provides BEE
ownership and control of the Projects in excess of South Africa`s
mining charter`s minimum requirement. Refer to paragraph 4.2
above for details of the joint venture.
8. SHARE CAPITAL
The authorised and issued share capital of FSE is set out below:
On the date
Notes of listing
A$
Authorised:
An unlimited amount of ordinary shares
with no par value
Issued:
800 708 879 ordinary shares of no par 57 819 282
value
52 250 000 unlisted 1 cent options 1
30 000 000 unlisted 5 cent options 2
Notes:
1. The option exercise price is 1 cent and they have an expiry date
of 30 June 2009.
2. The option exercise price is 5 cents and they have an expiry date
of 30 November 2012.
9. FINANCIAL INFORMATION OF FSE
The historical audited financial statements of FSE for the years ended 30
June 2007 and 30 June 2008 statements have been prepared in accordance with
the requirements of the Corporations Act 2001, applicable Accounting
Standards, Australian Accounting Interpretations and other mandatory
professional reporting requirements.
The financial report complies with Australian Accounting Standards, which
include Australian equivalents of International Financial Reporting
Standards. Compliance with AIFRS ensures that the financial report,
comprising the financial statements and notes thereto, complies with
International Financial Reporting Standards.
Set out below is an extract of the pro forma financial effects of the joint
venture referred to in paragraph 4.2 above, based on FSE`s audited results
for the year ended 30 June 2008. The financial effects are presented for
illustrative purposes only and because of their nature may not give a fair
reflection of the Company`s results, financial position and changes in
equity after the implementation of the joint venture. It has been assumed
for purposes of the pro forma financial effects that the above joint
venture was implemented with effect from 30 June 2008 for balance sheet
purposes. The directors of FSE are responsible for the preparation of the
financial effects, which have not been reviewed by FSE`s auditors.
Financial Pro forma
Audited effects Pro forma Translated
30 June 2008 30 June 2008 30 June 2008 30 June 2008
A$ A$ A$ R1
Shares issued 709,208,879 500,000,000 1,209,208,879 1,209,208,879
Net asset value 2,111,488 20,000,000 22,111,488 168,268,424
Net tangible asset 2,111,488 20,000,000 22,111,488 168,268,424
value
Net asset value per 0.30 cents 04.00 cents 01.83 cents 13.92 cents
share
Net tangible asset 0.30 cents 04.00 cents 01.83 cents +/- 13.92 cents
value per share
Note:
There is no pro forma income statement effect as all expenses are
capitalised.
10. COPIES OF THE PRE-LISTING STATEMENT
Copies of the full Pre-Listing Statement may be obtained at any time during
normal business hours from 22 October 2008 from the South African
representative office of FSE, River Group and Computer Investor Services
(Pty) Ltd, details of which are set out below:
- the representative office of FSE - Parc Nouveau Building, 225
Veale Street, Brooklyn, Pretoria, 0181;
- the office of River Group - Parc Nouveau Building, 225 Veale
Street, Brooklyn, Pretoria, 0181; and
- the office of Computershare Investor Services (Pty) Limited -
Ground Floor, 70 Marshall Street, Johannesburg, 2001.
27 October 2008
Johannesburg
Sponsor
River Group
Date: 27/10/2008 10:47:10 Produced by the JSE SENS Department.
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