Manuka Resources Ltd is the owner of the Wonawinta Silver Project, and also the entity which holds the Mt Boppy Gold Project.

Both projects are located in the highly prospective Cobar Superbasin in central New South Wales, Australia.

Numerous other companies are conducting mining and exploration activities within the Cobar Superbasin including Glencore and Sandfire Resources, as shown on the map at the bottom of the page.

Manuka Resources Ltd has to this point in time secured sufficient funding to take it through to production, which commenced in April 2020. During the month of April 2020, Manuka produced over 800 oz Au (in carbon).

The Company is also currently in the process of commissioning a modular elution circuit which will allow it to produce gold doré onsite at the Wonawinta Silver Project.

Wonawinta Silver Project

The Wonawinta Silver Project comprises of:

• a granted mining lease,
• a 52 million ounce JORC-compliant silver Mineral Resource,
• a 920 km2 portfolio of highly prospective exploration tenements,
• approx 500,000 tonnes ROM silver oxide stockpiles, and;
• a substantial processing plant with annual processing capacity of up to approximately 850,000 tonnes (the Wonawinta Processing Plant).

Mt Boppy Gold Project

In June 2019, Manuka completed the purchase of Mt Boppy Resources Pty Ltd (ACN 611 963 216), which included mining leases and exploration licences covering an area in excess of approximately 210 km2, a 40 person mine camp and the historically significant open pit Mt Boppy Gold Mine.

The Mt Boppy Gold Project has a JORC-compliant Reserve of 320,000t at 3.0 g/t for 31,000 oz Au.

The Mt Boppy Gold Mine has operated sporadically since 1895, having produced approximately 500,000 oz, Au at an average grade of approximately 15 g/tonne.

There are approximately 60,000 tonnes run of mill (ROM) gold ore stockpiles at the project.

In April 2020, the Company began processing this stockpiled gold ore at the Wonawinta Processing Plant and is also currently processing gold loaded carbon offsite at a third party facility.

The offsite carbon processing will cease following the commissioning of the Company’s modular elution circuit referred to above, as all processing will then be able to take place onsite at the Wonawinta Silver Project.

Over the short to medium-term, the Company plans to conduct the following three phases of activity:

• Phase 1 (next 12 months): continue processing stockpiled and mined Mt Boppy gold ore with the intention of recovering up to approximately 22,000 to 24,000 oz Au;
• Phase 2 (Q2, 2021): begin processing the silver oxide stockpiles at the Wonawinta Silver Project, and;
• Phase 3 (Q1 2022): begin the mining and processing of the shallow silver oxide resource at the Wonawinta Silver Project.

Concurrently with Phase 1, the Company also intends to:

• conduct an infill drilling program at the Wonawinta Silver Project and to conduct mine planning studies on the existing shallow (<60m) oxide Resource,
• commence drilling certain high conviction targets on the Mt Boppy Gold Project, including in areas comprising of a number of underexplored brownfield opportunities, and;
• commence drilling activities on certain other high conviction targets on the Company’s extensive and prospective exploration portfolio.

The Offer

Under the General Public Offer, Manuka Resources Ltd (ACN 611 963 225) is seeking gross proceeds of a minimum of $5.0 million with the ability to accept oversubscriptions of up to a further $2.0 million to raise a total of $7.0 million.

The gross proceeds raised under the General Public Offer will be used by the Company for the following purposes:

• to fund infill drilling and exploration programs at both the Mt Boppy Gold Project and the Wonawinta Silver Project;
• to pay outstanding interest on the Convertible Notes (each of which is expected to be converted pursuant to the Conversion Share Offer);
• for working capital purposes; and
• to pay the costs of the Offer.

In addition to the General Public Offer, the Company is also making the Conversion Share Offer to each eligible individual holder of the Company’s Convertible Notes.

The offer of the securities are made in, or accompanied by, a copy of the Disclosure Document which can be obtained by clicking on the "ACCESS DISCLOSURE DOCUMENT" button on this page.

Anyone who wants to acquire the securities will need to complete the application form that will be in or will accompany the Disclosure Document.

Before making an investment decision, potential investors should read the Disclosure Documents entirely, and seek professional financial advice.

Investors should be aware that there are risks associated with an investment in this Company.

The key risks related to an investment in the Company include various operational risks associated with the ongoing and proposed processing of gold ore and/or silver oxide material (either onsite or by the Company’s contractors), precious metals and input price volatility and risks associated with the Company’s significant financial indebtedness.

A complete set of risks associated with an investment in the Company is included in Section 7 of the Disclosure Document. Investors should consider those risks carefully in deciding whether to invest in the Company.

Key Offer Details

Note:

The Company expects that a significant proportion of the Shares held by Rescap Investments will be subject to ASX-imposed escrow for a period of 2 years from the date of Admission.

Company Debt on ASX Admission

On Admission to the ASX, the Company is expected to have total consolidated debts of approximately $24.66 million. This total debt is comprised of:

• a fully drawn US$14.0 million secured senior debt facility with TransAsia Private Capital Limited (a Hong Kong-based lender);
• $3.15 million AUD in unsecured working capital loans provided by various parties (refer Disclosure Document for details).

Key Terms of Core Debt Facility

The US$14.0 million Core Debt Facility has a coupon rate of 14% per annum (with interest payable by the Company on a quarterly basis) and must be repaid in three (3) tranches of principal as detailed below.

Following Admission, the Company is required to repay the principal owing under the Core Debt Facility in the following manner:

• Tranche 1: US$2.5 million is due to be repaid on 5 October 2020;
• Tranche 2: US$5.0 million is due to be repaid on 3 February 2021; and
• Tranche 3: US$6.5 million is due to be repaid on 5 April 2021.

The Company is also required to repay the total outstanding balance owing under the Interim Debt Facility (i.e. of approximately $2.17 million) on or before 11 June 2020.

The Company expects that it will repay the Interim Debt Facility from operating cash flow before Admission.

The Company’s Basis to Repay its Debts

The Company believes that it will be able to repay all of its debts as and when they fall due during the first 12 months following admission to the ASX.

During this period, the Company expects that it will be able to produce up to approximately 22,000 to 24,000 oz of gold by:

• continuing to truck gold-loaded carbon for further processing at Como Carbon Services Pty Ltd’s refinery in Perth, Western Australia; and
• utilising the Company’s soon-to-be-commissioned modular elution circuit to produce gold doré onsite at the Wonawinta Silver Project from the remainder of the Company’s stockpiled gold bearing ore and easily recoverable reserves from the Mt Boppy Gold Project.

It is on this basis that the Directors believe that the Company will be able to generate sufficient cash flow from operations to enable it to repay all of its debts as and when they fall due.

Indicative Timetable

Cobar Superbasin - Map of Mines and Explorers