REG - Castillo Copper Ltd - March 2024 Quarterly Activities Report

Castillo CopperAnnouncement

30/04/2024 12:15

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240430:nRSd6330Ma&default-theme=true

RNS Number : 6330M  Castillo Copper Limited  30 April 2024

30 April 2024

 

CASTILLO COPPER LIMITED

("Castillo", "CCZ" or the "Company")

 

March 2024 Quarterly Activities Report

 

Castillo Copper Limited (LSE and ASX: CCZ), a base metal explorer primarily
focused on copper across Australia and Zambia, is pleased to present
shareholders its latest quarterly report for the period 1 January 2024 to 31
March 2024.

 

HIGHLIGHTS:

 

Strategic Asset Portfolio Update

 

·    A strategic portfolio review undertaken in Q4 2023 determined which
assets would remain core and highly prospective.

·    In this quarter, Castillo Copper divested itself of two Exploration
Licenses, which formed part of the larger Broken Hill Project.

 

Rimfire (ASX:RIM, "Rimfire") acquires two Exploration Licenses from Castillo
Copper

 

·    Rimfire acquired an unencumbered 100% ownership of Exploration
Licenses 8572 and 8599 (Castillo tenements).

·    Rimfire announced the acquisition on 11 January and completed it on
21 March 2024.

 

Corporate

 

·    Mr Jack Sedgewick BEng BCom MBA (Distinction) GAICD stepped down from
his role as Non-Executive Director on 14 Mar.

·    Dr David Drakeley stepped down from his role as Non-Executive
Director on 14 Mar.

·    Mr Eduardo Robaina BEng assumed the role of Non-Executive Director on
14 Mar.

·    Mr Joel Logan BSc assumed the role of Non-Executive Director on 14
Mar.

 

Cash and Liquid Investments

 

·    Cash on hand at end of quarter totalled $1.387m.

·    Rehabilitation Security Bonds totalled $486,960 at quarter end, of
which $172,900 is expected to convert to cash within 3 months.

·    CCZ holds 13,440,861 Rimfire Pacific Mining Ltd (ASX: RIM) shares
which as at 26 March 2024 had a market value of ~$417,000.

 

Eduardo Robaina, Non-Executive Director, commented: "I am very much looking
forward to assuming an active role on the Castillo Copper Board, seeking to
bolster Company efforts in executing the asset strategy that has been devised
in the later stages of 2023.

 

"This strategy has included making a considered assessment of our existing
tenements - whilst all prospective in their own right - to identify those that
we deem core or complementary to our team's collective strengths and our
Company objectives at current.

 

"Subsequently, the rationalisation of our Australian and Zambian portfolio has
to date resulted in the successful divestment of two of our four tenements at
Broken Hill to Rimfire, an established explorer in this district.

 

"In addition to this divestment, future activity will further enable the
Company to optimise its capital allocation, which will prove critical to
making advancements at our core asset - the NWQ Project - situated in the
established Mount Isa copper belt and consisting of over 20 prospects of
interest.

 

"2023 was undoubtedly a year to reset and redirect Company efforts. Now, with
a renewed Corporate structure and clear path forward, Castillo Copper looks
forward to returning focus upon delivery."

 

STRATEGIC ASSET PORTFOLIO UPDATE

 

Prospect Interpretations at Core Asset

 

During Q4 2023, a strategic review was completed to assess the location,
timing and sequence of planned exploration activities across Castillo's
existing portfolio.

 

As part of the review process, members of the geology team visited the North
West Queensland Copper Project's Boomerang and Josephine Prospects to assess
their exploration potential. Both have been interpreted as prospective for
structurally controlled copper mineralisation.

 

Sale Price of Exploration Licenses 8572 and 8599

 

It was determined that Company assets deemed non-core would be sold. Castillo
Copper divested itself of two tenements at Broken Hill this quarter, selling
Exploration Licenses 8572 and 8599 to Rimfire Pacific Mining Ltd (ASX: RIM)
(Rimfire). These assets were prospective of cobalt, copper and pegmatite rare
earth elements.

 

As per the agreement terms, Rimfire issued 8,064,516 Rimfire Ordinary Shares
(Consideration Shares) to Castillo Copper being $150,000 worth of shares at an
issue price of $0.0186 (Consideration Shares Issue Price).

 

Rimfire issued a further $150,000 worth of Rimfire Ordinary Shares (Subsequent
Shares) at an issue price of $0.0279, which was 50% above the Consideration
Shares Issue Price (Subsequent Shares Issue Price). As a result, Rimfire
issued Castillo Copper 5,376,345 Shares at this price.

 

At 26 March 2024, CCZ's shareholding in Rimfire had a market value of
~$417,000.

 

CORPORATE BOARD CHANGES

 

Outgoing Non-Executive Directors

 

As of 14 March 2024, Jack Sedgewick and David Drakeley stepped down as
Non-Executive Directors. Chairman, Gerrard Hall personally thanked Jack and
David for assisting in guiding the Company's reinvigorated development
strategy in recent months.

 

"No doubt we find ourselves facing a challenging market at present, however
with core assets identified - as well as a commitment to advance development
at these operations with targeted exploration activity - the company is
well-equipped to forge ahead. Castillo wishes Jack and David all the best in
their future endeavours," Gerrard Hall said.

 

Incoming Non-Executive Directors

 

As of March 2024, Eduardo Robaina and Joel Logan joined Castillo Copper in the
capacity of Non-Executive Directors.

 

"To bolster our developmental efforts in 2024 and beyond, we are incredibly
excited to welcome aboard Eduardo and Joel to the Castillo Copper Board. Each
possesses a unique calibre of experience, the Company looks forward to
maximising Company value with the adage of their joint expertise," Gerrard
Hall said.

 

About Mr Eduardo Robaina, Non-Executive Director

 

Eduardo Robaina is an accomplished Managing Director and Engineering
Consultant with an executive and technical skillset that will greatly
complement that of the Castillo Board.

 

Possessing over two decades of experience working in the resources sector,
spanning both technical and leadership positions at foremost businesses -
including the likes of Woodside, Mineral Resources, Santos and most recently
Add Energy (part of ABL Group) - Mr Robaina brings an all encompassing
understanding of business operations.

 

In his most recent position as Managing Director at Add Energy, Mr Robaina was
responsible for overseeing the business operating model, which saw the Company
achieve significant financial growth over a 4-year period. He was an active
member in Add Energy's Executive team during its 2022/23 acquisition and
integration into ABL Group.

 

About Mr Joel Logan, Non-Executive Director

 

Joel Logan is an Exploration Geologist with an impressive breadth of work
experience in exploration, development and producing assets. These operations
have hosted a variety of resources such as copper, uranium, gold, lithium,
nickel, cobalt and PGEs.

 

Over the course of his professional career, Mr Logan has developed strong
theoretical and practical skills, enabling the delivery of geoscientific
outcomes to notable Companies and operations, including the likes of BHP's
Olympic Dam Project and Azure Minerals Ltd's Andover Project.

 

Mr Logan's role at Azure Minerals saw him design and execute exploration and
drill hole strategies, in addition to resource development of highly
mineralised LCT pegmatities. This experience in driving early-stage activity
will be invaluable to furthering Castillo's asset development strategy.

 

CASH AND LIQUID INVESTMENTS

 

Cash on Hand

 

Cash on hand at end of quarter totalled $1.387m.

 

Rehabilitation Security Bonds

 

Rehabilitation Security Bonds totalled $486,960 at quarter end, of which
$172,900 is expected to convert to cash within 3 months.

 

Listed investments

 

CCZ holds 13,440,861 Rimfire Pacific Mining Ltd (ASX: RIM) shares which as at
26 March 2024 had a market value of ~$417,000.

 

 

For further information, please contact:

 

 Castillo Copper Limited                                             +61 8 6558 0886 
 Gerrard Hall (UK), Chairman                                          
                                                                      
 SI Capital Limited (Financial Adviser and Corporate Broker)         +44 (0)1483 413500 
 Nick Emerson                                                          
                                                                       
 Gracechurch Group (Financial PR)                                    +44 (0)20 4582 3500
 Harry Chathli, Alexis Gore, Henry Gamble                             

 

About Castillo Copper

 

Castillo Copper Limited is an Australian-based, Australian-focussed copper
exploration Company with a strategy to develop multi-commodity assets that
demonstrate future potential as an economic mining operation.

Through the application of disciplined and structured exploration and
analysis, Castillo Copper has identified assets deemed core to the Company's
sustained growth and is actively progressing these interests up the value
curve.

Current focus will be on advancing exploration activity at the Company's
wholly owned NWQ Project, situated in the copper-belt district approximately
150km north of Mt Isa in north-west Queensland.

Other interests include the Broken Hill Project in western New South Wales and
the Cangai Copper Mine in north-east New South Wales, as well as exploration
targets in Zambia.

Castillo Copper is listed on the LSE and ASX under the ticker "CCZ".

 

APPENDIX A: Key Projects

Figure 1: BHA Project, Broken Hill Region (Source: CCZ Geology Team)

Figure 2: Zambia Copper-Belt Projects (Source: CCZ Geology Team)

.

 

 

 

Figure 3: Historic drilling results in SYG's Mining Lease (Source: Refer to
CCZ ASX Release 11 November 2019)

 

 

 

Figure 4: NWQ Copper Project, Mt Isa Region (Source: CCZ Geology Team)

 

 
APPENDIX B: Interest in mining tenements held

Table 1: Jackaderry (Cangai), New England Orogen in NSW

 Tenement ID  Ownership at start of Quarter  Ownership at end of Quarter  Change during the Quarter
 EL8635       100%                           100%                         -
 EL8625       100%                           100%                         -
 EL8601       100%                           100%                         -

 

 

Table 2: Broken Hill, located within a 20km radius of Broken Hill in NSW

 

 Tenement ID  Ownership at start of Quarter  Ownership at end of Quarter  Change during the Quarter
 EL8599       100%                           -                            100%
 EL8572       100%                           -                            100%
 EL8434       100%                           100%                         -
 EL8435       100%                           100%                         -

 

Table 3: Mt Oxide, Mt Isa region in North West Queensland

 

 Tenement ID  Ownership at start of Quarter  Ownership at end of Quarter  Change during the Quarter
 EPM 26513    100%                           100%                         -
 EPM 26525    100%                           100%                         -
 EPM 26574    100%                           100%                         -
 EPM 26462    100%                           100%                         -
 EPM 27440    100%                           100%                         -

 

Table 4: Zambia

 

 Tenement ID              Ownership at start of Quarter  Ownership at end of Quarter  Change during the Quarter
 24659-HQ-LEL (Mkushi)    100%                           100%                         -
 25195-HQ-LEL (Luanshya)  55%                            -                            55%
 25273-HQ-LEL (Luanshya)  55%                            -                            55%
 25261-HQ-LEL (Mwansa)    100%                           -                            100%

 

 

 

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash
flow report

 

 Name of entity
 Castillo Copper Ltd
 ABN                    Quarter ended ("current quarter")
 52 137 606 476         31 March 2024

 

 Consolidated statement of cash flows                                 Current quarter  Year to date (9 months)

                                                                      $A'000           $A'000
 1.                   Cash flows from operating activities
 1.1                  Receipts from customers
 1.2                  Payments for
                      (a)  exploration & evaluation
                      (b)  development
                      (c)  production
                      (d)  staff costs
                      (e)  administration and corporate costs         (293)            (956)
 1.3                  Dividends received (see note 3)
 1.4                  Interest received                               4                27
 1.5                  Interest and other costs of finance paid
 1.6                  Income taxes paid
 1.7                  Government grants and tax incentives
 1.8                  Other (provide details if material)
 1.9                  Net cash from / (used in) operating activities  (289)            (929)

 2.                   Cash flows from investing activities

                                                                      (59)             (560)
 2.1                  Payments to acquire or for:
                      (a)  entities
                      (b)  tenements
                      (c)  property, plant and equipment
                      (d)  exploration & evaluation
                      (e)  investments
                      (f)    other non-current assets

 

 Consolidated statement of cash flows                                                               Current quarter  Year to date (9 months)

                                                                                                    $A'000           $A'000
 2.2                  Proceeds from the disposal of:

                                                                                                    (28)             (28)
                      (a)  entities
                      (b)  tenements
                      (c)  property, plant and equipment
                      (d)  investments
                      (e)  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 activities                                (87)             (588)

 3.                   Cash flows from financing activities
 3.1                  Proceeds from issues of equity securities (excluding convertible debt
                      securities)
 3.2                  Proceeds from issue of convertible debt securities
 3.3                  Proceeds from exercise of options
 3.4                  Transaction costs related to issues of equity securities or convertible debt
                      securities
 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)
 3.10                 Net cash from / (used in) financing activities                                -                -

 4.                   Net increase / (decrease) in cash and cash equivalents for the period
 4.1                  Cash and cash equivalents at beginning of period                              1,747            2,897
 4.2                  Net cash from / (used in) operating activities (item 1.9 above)               (289)            (929)
 4.3                  Net cash from / (used in) investing activities (item 2.6 above)               (87)             (588)
 4.4                  Net cash from / (used in) financing activities (item 3.10 above)              -                -

 

 Consolidated statement of cash flows                                    Current quarter  Year to date (9 months)

                                                                         $A'000           $A'000
 4.5                  Effect of movement in exchange rates on cash held  16               7
 4.6                  Cash and cash equivalents at end of period         1,387            1,387

 

 5.   Reconciliation of cash and cash equivalents                                 Current quarter  Previous quarter

      at the end of the quarter (as shown in the consolidated statement of cash   $A'000           $A'000
      flows) to the related items in the accounts
 5.1  Bank balances                                                               987              1,747
 5.2  Call deposits                                                               400              -
 5.3  Bank overdrafts
 5.4  Other (provide details)
 5.5  Cash and cash equivalents at end of quarter (should equal item 4.6 above)   1,387            1,747

 

 6.   Payments to related parties of the entity and their associates                 Current quarter

                                                                                     $A'000
 6.1  Aggregate amount of payments to related parties and their associates included  531
      in item 1
 6.2  Aggregate amount of payments to related parties and their associates included  402
      in item 2

 1Comprises director's fees for the quarter.

 2Comprises consulting fees paid to the Managing Director and exploration
 expenditure paid to Field Crew Pty Ltd, a related entity of director David
 Drakeley.

 7.   Financing facilities                                                     Total facility amount at quarter end  Amount drawn at quarter end

      Note: the term "facility' includes all forms of financing arrangements   $A'000                                $A'000
      available to the entity.

      Add notes as necessary for an understanding of the sources of finance
      available to the entity.
 7.1  Loan facilities
 7.2  Credit standby arrangements
 7.3  Other (please specify)
 7.4  Total financing facilities

 7.5  Unused financing facilities available at quarter end
 7.6  Include in the box below a description of each facility above, including the
      lender, interest rate, maturity date and whether it is secured or unsecured.
      If any additional financing facilities have been entered into or are proposed
      to be entered into after quarter end, include a note providing details of
      those facilities as well.

 

 8.   Estimated cash available for future operating activities                        $A'000
 8.1  Net cash from / (used in) operating activities (item 1.9)                       (289)
 8.2  (Payments for exploration & evaluation classified as investing activities)      (59)
      (item 2.1(d))
 8.3  Total relevant outgoings (item 8.1 + item 8.2)                                  (347)
 8.4  Cash and cash equivalents at quarter end (item 4.6)                             1,387
 8.5  Unused finance facilities available at quarter end (item 7.5)
 8.6  Total available funding (item 8.4 + item 8.5)                                   1,387

 8.7  Estimated quarters of funding available (item 8.6 divided by item 8.3)          4.0
 Note: if the entity has reported positive relevant outgoings (ie a net cash
 inflow) in item 8.3, answer item 8.7 as "N/A". Otherwise, a figure for the
 estimated quarters of funding available must be included in item 8.7.
 8.8  If item 8.7 is less than 2 quarters, please provide answers to the following
      questions:
      8.8.1     Does the entity expect that it will continue to have the current
      level of net operating cash flows for the time being and, if not, why not?
      Answer: N/A
 8.8.2     Has the entity taken any steps, or does it propose to take any
 steps, to raise further cash to fund its operations and, if so, what are those
 steps and how likely does it believe that they will be successful?
      Answer: N/A

 

 

    8.8.3     Does the entity expect to be able to continue its operations and
    to meet its business objectives and, if so, on what basis?
    Answer: N/A
    Note: where item 8.7 is less than 2 quarters, all of questions 8.8.1, 8.8.2
    and 8.8.3 above must be answered.

 

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.

 

 

 

Date:                      30 April 2024

 

 

 

Authorised by: The Board of Directors

(Name of body or officer authorising release - see note 4)

 

 

Notes

1.          This quarterly cash flow report and the accompanying
activity report provide a basis for informing the market about the entity's
activities for the past quarter, how they have been financed and the effect
this has had on its cash position. An entity that wishes to disclose
additional information over and above the minimum required under the Listing
Rules is encouraged to do so.

2.          If this quarterly cash flow 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 cash
flow 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.

4.          If this report has been authorised for release to the
market by your board of directors, you can insert here: "By the board". If it
has been authorised for release to the market by a committee of your board of
directors, you can insert here: "By the [name of board committee - eg Audit
and Risk Committee]". If it has been authorised for release to the market by a
disclosure committee, you can insert here: "By the Disclosure Committee".

5.          If this report has been authorised for release to the
market by your board of directors and you wish to hold yourself out as
complying with recommendation 4.2 of the ASX Corporate Governance Council's
Corporate Governance Principles and Recommendations, the board should have
received a declaration from its CEO and CFO that, in their opinion, the
financial records of the entity have been properly maintained, that this
report complies with the appropriate accounting standards and gives a true and
fair view of the cash flows of the entity, and that their opinion has been
formed on the basis of a sound system of risk management and internal control
which is operating effectively.

 

 

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 (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  DRLWPURUCUPCGGU