On behalf of the Board of Directors, I am pleased to present to you the opportunity to become an investor in the Company.
The Public Offer proposed in this Prospectus is seeking to raise AU$14,000,000 through the issue of 35,000,000 Shares at
a price of $0.40 per share.
The Company is currently listed on ASX but is suspended. The Directors of the Company have determined that the most
appropriate method by which the Company can pursue its objectives as stated in this Prospectus is to seek listing on the
NSX. ASX has advised that it will remove the Company from the ASX upon listing on the NSX. Prospective investors should
be aware that the NSX is a different platform than the ASX that operates in substantially the same manner as ASX with a
similar regulatory regime and settlement procedures. The Public Offer is conditional upon the removal of the Company
from ASX and the approval of NSX to the listing of the Company.
The Company has entered into an agreement pursuant to which the Company will acquire 100% of the issued capital of
Takmur Pte Ltd (Takmur) to be affected by a share exchange agreement made by and between the Company and Takmur
on 30 July 2019 (Share Exchange Agreement).
The funds raised by the Public Offer will allow the Company to meet the funding requirements arising from its acquisition
of Takmur (Acquisition) and to conduct exploration and development programs on its flagship Mandiri Project in Indonesia.
The Mandiri Project consists of a licensed concession area of 2,032 hectares located in Central Kalimantan, Indonesia for
mineral sands exploration and premium grade Zircon production and export. Zircon processing occurs at the Mandiri Plant
which has been built and is operational.
The proposed Acquisition will see the Company focus its commercial and strategic activities on mineral sands exploration
and production. The Company intends to establish itself as a significant player in mineral sands exploration and production
through the development of the Mandiri Project.
It is important to note that the interests of the Company in the Mandiri Project are contractual in nature in that Takmur
has an exclusive operation and management agreement with Mandiri. The Company does not have a direct ownership
interest in the Mandiri Tenement or the Mandiri Plant. Prospective investors should carefully consider the details of this
agreement summarised in Section 11 of this Prospectus.
The Mandiri Project is currently being exploited through the use of contract artisanal miners however it should be noted
that the Company has evidence of there being a history of artisanal mining on the Mandiri Tenement (being the
investigations of the Company into the current practices of Mandiri and feedback from the appointed Technical Expert,
Continental Resource Management Pty Ltd).
In the period from September 2010 and up to December 2016, Mandiri undertook technical and geological analysis in order
to determine the tenement areas suitable for HMC extraction and the necessary specifications for the processing plant to
produce zircon. In addition, during the same period, Mandiri completed landscape improvement operations to facilitate
HMC extraction and sourced appropriate personnel for the Mandiri Project.
There is a risk that where historical artisanal mining has occurred, a lack of control and oversight exists over operations
and, as a result, a risk that all licence conditions have not always been complied with. Since Takmur has been involved with
the Mandiri Project in January 2019 it has put in place appropriate measures to ensure that artisanal miners are properly
engaged by the holders of the Mandiri Tenement. Prospective investors should be aware of these risks and should consider
the appropriateness of making an Application in this context as a breach of licence conditions may result in fines, penalties
or forfeiture. It should be noted that the gold content of drilling results and concentrate delivered to the Mandiri Plant
varies significantly, as such Mandiri cannot guarantee that the contract artisanal miners are not (illegally) mining for gold.
The Technical Report indicates that gold is present in HMS samples, but gold is mostly absent from the HMC delivered to
the Mandiri Plant. Mandiri does not yet have in place accurate systems which will effectively monitor contract miners to
prevent them from extracting gold from the Mandiri Tenement.
As at the date of this Prospectus the Mandiri Project currently operates as follows:
• Ore is extracted by contracted miners using pumps where the soil is pumped over riffle boxes which results in a
heavy mineral concentrate (HMC) being collected at the Mandiri Tenement;
• The HMC is then loaded onto trucks under the supervision of engaged mining supervisors, and is trucked by road
to the Mandiri Plant;
• The Mandiri Plant consists of standard HMC processing equipment, including gravity shaking tales, dryers,
electro-static separators and electro-magnetic separators, which processes the HMC into saleable Zircon product;
• The Zircon product is then bagged and verified at the Mandiri Plant by a Factory and Mining Officer, loaded onto
trucks and driven to the nearest Port at Banjarmasin where the Zircon is sold and/or shipped to the customer.
The extraction and processing set out above is directly supervised and controlled by Mr Oliver B. Hasler and a Factory and
Mining Officer who are responsible for ensuring adherence to best practice and compliance with licence conditions, including
compliance with conditions relating to export of Zircon from Indonesia. Mandiri’s management and its security unit also
monitor access to the Mandiri Tenement so as to mitigate against any interference from non-authorised parties.
The Company held a General Meeting of its Shareholders on 13 December 2019 (General Meeting) to seek approval for,
among other matters, the issue of securities to effect the Acquisition, the change in nature and scale of the Company’s
operations and the change of the name of the Company to “Pyx Resources Limited”. Shareholder approval was given for each
of these resolutions.
This Prospectus contains detailed information about the Company. This is a highly speculative investment and investors
should refer to, and consider carefully, the risk factors outlined in this prospectus at Section 5 prior to making any investment
decision. An investment in the Company involves a number of risks and consequently such an investment must be taken
having paid due regard to the risks involved to the security of any capital invested. Before you make any investment I wholly
recommend and encourage you to read this Prospectus in its entirety and to seek appropriate financial advice.