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DIRECTORS’ REPORT
68 Independence Group NL
Directors' report
30 June 2015
Operating and financial review (continued)
• The Jaguar zinc, copper and silver mine and processing operations, located 60km north of Leonora in Western
Australia - 100% owned. The Jaguar Operation consists of the Bentley underground mine, the Jaguar processing
facility and administration infrastructure and the accommodation village. These assets are situated on tenure that
hosts a 50km long corridor of prospective stratigraphy.
The prospective corridor has hosted three economically viable volcanogenic massive sulphides ("VMS") ore bodies.
The first deposit discovered was Teutonic Bore in 1976. The Jaguar deposit was discovered in 2002, approximately
4km south of Teutonic Bore and the most recent discovery, the Bentley deposit located another 4km south of
Jaguar, was discovered in 2008.
All ore is processed at the Jaguar concentrator, which produces both a copper and a zinc concentrate. The copper
concentrate also contains significant silver and gold credits. The concentrates are trucked to the port of Geraldton
for export; and
• The Long nickel mine located near Kambalda - 100% owned. The Company acquired the Long Operation in
Kambalda, Western Australia, from BHP Billiton Nickel West Pty Ltd ("BHPB Nickel West") in September 2002. The
mine was successfully re-commissioned in October 2002 and has been operating successfully and safely since
then.
Since recommissioning, and through to 30 June 2015, the Long Operation has mined 2.9 million ore tonnes for
116,215 tonnes of contained metal and has achieved exploration success with the discovery of the McLeay (2005)
and Moran (2008) ore bodies. At the time of purchasing the Long Operation, the Group entered into an offtake
agreement with BHPB Nickel West whereby the ore produced from the mine is delivered to the adjacent BHPB
Nickel West Kambalda Nickel Concentrator for toll treatment and production of nickel concentrate. The current
offtake agreement with BHPB Nickel West expires in February 2019.
Sirius Resources NL transaction - On 25 May 2015, the Company and Sirius Resources NL (“Sirius”) announced the
execution of a binding Scheme Implementation Deed (“SID”) under which the Company will acquire all the issued
capital of Sirius by way of an Acquisition Scheme of Arrangement (the “Acquisition Scheme”).
Under the Acquisition Scheme, Sirius shareholders will receive 0.66 IGO shares and 52 cents cash for each Sirius
share. Sirius shareholders will also participate pro-rata in the demerger of the Polar Bear and Scandinavian exploration
assets.
The transaction is intended to create a leading diversified Australian mining company with a strong portfolio of
high-margin/long-life mining assets, across a range of base and precious metals. The combination of the two companies
has a strategic rationale of generating significant value for the shareholders of both companies. A successful acquisition
will bring the world-class Nova Project into the IGO Group portfolio. The Boards of both IGO and Sirius have
unanimously recommended that all Sirius shareholders vote in favour of the Acquisition Scheme.
The transaction remains on track with Sirius shareholders expected to approve the scheme in early September 2015
and the Company expected to complete the issue of the Share Scheme consideration in mid-September 2015.
The Group is also an active explorer for base and precious metals within and outside of Australia. Active search areas
within Australia include:
• Tropicana (Havana) Near-mine Exploration - A total of 187 aircore ("AC") holes (7,034m), 49 reverse circulation
("RC") holes (6,822m) and 44 diamond holes (11,009) were completed in FY2015 targeting down dip extensions to
mineralisation at Tropicana, Havana North and Havana South. Better results include 12m @ 1.79g/t Au and 5m @
5.25g/t Au at Havana North, 8m @ 3.48g/t Au at Crouching Tiger and 19m @ 1.19g/t in the Tropicana Extensions
area.
A high resolution 3D seismic survey was completed over the immediate down dip projection of the Tropicana ore
body. This work has highlighted a number of high priority structural targets which are currently being drill tested.
• Regional exploration continues to identify and test numerous prospects. In total 774 AC holes (46,514m), 65 RC
holes (7,465m) and eight diamond holes (1,312m) were completed. Encouraging gold assay results were returned
from several prospects. The most significant came from Madras, located 25km south of Tropicana. Drilling will
continue throughout calendar 2015 to define the extent of mineralisation at Madras.
Independence Group NL
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