2011 Annual Report Final

ACN 125 222 291
Annual Report 2011
11
CORPORATE DIRECTORY
Directors Craig Readhead Non-Executive Chairman Mike Donaldson Non-Executive Director Jim Jewell Non-Executive Director Ross Kestel Non-Executive Director Peter Bowler Managing Director Rob Watkins Executive Director Exploration Company Secretary Greg Barrett Corporate Details Beadell Resources Ltd (ABN 50 125 222 291) Issued Capital 716,004,752 ordinary shares Registered and Corporate Ofce 2nd Floor, 16 Ord Street West Perth WA 6005 Telephone: +61 8 9429 0800 Facsimile: +61 8 9481 3176 Internet: www.beadellresources.com.au Brazil Ofces Rio De Janeiro Rua Voluntrios da Ptria, 89, 6 andar, Botafogo RJ Telephone: + 55 21 2122 0500 Facsimile: + 55 21 2122 0502 Tucano Minesite Estrada do Tapereb, SN, Pedra Branca do Amapari AP Telephone: +55 96 4009 4004 Facsimile: +55 21 2122 2438 Share Registry Computershare Investor Services Pty Ltd Level 5 115 Grenfell Street Adelaide SA 5000 Telephone: 1300 137 515 Telephone: +61 3 9415 4667 (from outside Australia) Stock Exchange Listing ASX Ltd ASX Code: BDR Auditor KPMG 235 St Georges Terrace Perth WA 6000
CONTENTS
Letter FroM CHairMan and ManaGinG director BRAZIL TUcano Gold ProJect Overview CIL Process Plant Construction Mining Operations Resource and Reserve Development Iron Ore COMMUNITY & ENVIRONMENT TARTARUGA PROJECT AUSTRALIA Tropicana East West Musgrave Lake Mackay Victoria RESOURCE & RESERVES TENEMENT SCHEDULE FINaNCIaL REPORT Directors REPORT CONSOLIDATED STATEMENT OF FINANCIAL POSITION CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME CONSOLIDATED STATEMENT OF CHANGES IN EQUITY CONSOLIDATED STATEMENT OF CASH FLOWS NOTES TO THE FINANCIAL STATEMENTS DIRECTORS DECLARATION INDEPENDENT AUDITORS REPORT AUDITORS INDEPENDENCE DECLARATION ADDITIONAL sHareHolder INFORMATION 17 36 37 38 40 41 79 80 82 83 1 2 3 3 4 4 8 10 11 12 12 13 13 13 14 16
Front cover: Cat 777D Trucks Inside cover: Mining operations on AB1 pit. Back cover: A Tucano (Toucan) photographed in Brazil.
LETTER FROM CHAIrmAN AND MANAGING DIRECTOR
11
Dear Fellow Shareholder, Despite global uncertainties and share market volatility over the past twelve months, we have continued to add substantial value to our Company for the benet of you, our shareholders. Construction of the 3.5 million tonnes per annum carbon in leach gold plant at our Tucano gold and iron ore project continues apace and we look forward to the transition from gold developer to producer during CY 3rd quarter this year. Despite some minor delays with the construction timetable, I am pleased to report that we are still on track to build the gold plant for less than the initial US$100M budget. This will be a commendable achievement and full credit to all involved with the construction. Gold production will be high in the early years with 180,000 ounces of gold forecast for CY 2013. We are determined to greatly enhance the economics of our gold project and hence protect the Company from any unforseen downturn in the gold price by extracting maximum value possible from our extensive iron ore resources found within Beadells Mining Concession. To this end, we have recently commenced detailed engineering design for a Magnetic Separation Plant to enable extraction from the gold tailings of a high grade iron concentrate which should result in lower cash operating costs from our gold plant by 20 30%. Additionally, negotiations with third parties are continuing to monetise value from more than 200 million tonnes of high grade friable hematite iron ore located in and around our gold pits. We are condent these two initiatives will enable the production costs on our gold plant to be driven down to rank globally into the lowest cost quartile. Special mention needs to be made of the excellent team of talented people we have in Brazil, led by Silvano Andrade. Safety continues to be our number one priority on site as we vigorously pursue our aim of zero harm to all employees. Silvano has assembled a complete management team in place ready for the commencement of gold production over the coming months. Mining of our open pits has already commenced with new earthmoving equipment to supplement our existing eet on its way. Silvano and his team have an excellent working relationship with all of the relevant government agencies and stakeholders. This has enabled all permits and approvals to be obtained in a timely manner. Beadell is committed to fostering a harmonious relationship with all communities, both local and state. As a consequence, the Company has been the recent recipient of various awards. In addition, we have an experienced, stable and fully aligned Perth based executive management team, who together with our Brazil based site management team with a full complement of trained personnel and adequate funding means that the Company will transition into a long life, low cost gold producing company in 2012. Our team looks forward to rewarding you, our shareholders, as we become a protable gold mining house taking full advantage of the continued high gold prices. Yours faithfully,
PETER BOWLER Managing Director
CRAIG READHEAD Non-Executive Chairman
BRAZIL
TUcANo Gold ProJect
Figure 1 Brazil Projects location plan
Tucano site transport
Mining operations at AB1 pit
Beadell Resources Limited Annual Report 2011
OVERVIEW
Since acquiring the Tucano Gold Project in Brazil in January 2010, Beadell has completed a Denitive Feasibility Study (DFS), secured international bank nancing and is now constructing a 3.5 million tonne per annum Carbon in Leach (CIL) gold processing plant.
Silvano de Souza Andrade Brazilian General Manager
During the year mining was resumed at Tucano utilising the eet of earthmoving equipment acquired with the project. The resultant stockpile will enable the higher grade gold ore to be processed rst providing improved cash ows in the early period of operation. A maiden JORC compliant reserve of 1.25 million ounces of gold was announced in April 2011. The Companys aggressive ongoing drilling campaign will continue to add to the existing 4.3 million ounce gold resource at the project. The Tucano site is located in Amap State in northern Brazil, covering approximately 2,500km2 of mostly contiguous exploration licences and a mining concession. The nearest major populated centre to the Tucano site is Macap, situated on the northern bank of the Amazon River (Figure 1). Road access to the site is via 100km of paved road from Macap to Porto Grande followed by 116km of unpaved road. The site is just north of the equator, with annual rainfall averaging 2,370mm. The Tucano Mine site is currently powered by a 13.8KVa substation sourced from the Caoraci Nunes hydroelectric power station in Porto Grande.
CIL Process Plant Construction

The Detailed Engineering for the Tucano 3.5 million tonne per annum CIL process plant commenced in January 2011 with the appointment of Ausenco to undertake the EPCM (Engineering, Procurement, Construction, Management) contract. During the next six months, engineering and early procurement was advanced, as was the completion of earthworks to establish the site for the Crusher, surge bin, SAG mill and the CIL tanks. The civil contractor was mobilised in June 2011 (start of dry season) to commence work on the CIL tank rings and the SAG mill raft and then progress on to the crusher and surge bin. In CY 4th Quarter 2011, the SMP (Structural/Mechanical/ Piping) contractor commenced work to erect the CIL tanks. During this same period the E&I (Electrical/ Instrumentation) contractor also mobilised to the Tucano site. Procurement is now 100% complete. The only signicant shipments that are outstanding are the electrical switch gear from Australia and China and these items are due for delivery in Brazil during April 2012. Construction activity will signicantly increase during the 2nd Quarter of 2012 with erection of the steel around the CIL tanks being the critical activity. First ore delivery to the SAG mill is scheduled for 3rd Quarter of 2012 and to date the project is within its budget of US$99M.
BRAZIL
TUcANo Gold ProJect (Continued) Mining Operations
Mining operations recommenced at Tucano in June and initially concentrated on the mining of the two pits in the Tap D valley and the Tap AB eastern wall cutback. The Tap D valley is the site of the rst tailings facility at Tucano and as such the gold reserves within it have to be extracted prior to tailings placement. Concurrent to mining in this valley, construction of the tailings dam wall was undertaken. The dam wall was largely complete at the end of 2011 but will be nalised in 2012. The stripping of the eastern wall of the Tap AB pit is required to gain access to the high grade trough zone within the Tap AB 2 pit and this work has to be undertaken in the dry season (July-December) to maximise mining productivity. In addition, work was carried out to establishment strategic sediment dams (to control the generation of turbid water into the local river system) and the establishment of a new quarry to generate material for use in Haul road construction, CIL plant construction and general infrastructure. Major overhaul of the mines Caterpillar haul trucks and Liebherr excavators commenced to ensure high mechanical availability is achieved. In addition, a tender process was undertaken for new open pit equipment that is required for the ramp up of mine output in 2012. This future equipment will be obtained via an operating lease arrangement.
Resource and Reserve Development

Gold resources increased by 48% to 4.3Moz of gold at the Tucano project in Brazil. Global JORC resources for Tucano now total 90.4Mt @ 1.5g/t for 4.3Moz of gold at a 0.5g/t cut off, comprising 19.5Mt @ 1.5g/t gold for 1.0Moz of oxide which will form the main ore source for the rst 3 to 4 years of the operation followed by the primary ore which comprises a resource of 63.6Mt @ 1.5g/t for 3.1Moz of gold. The global resource comprises Measured Resources from stockpiles of 7.4Mt @ 0.9g/t gold for 0.21Moz. Total Indicated Resources for Tucano are 40.1Mt @ 1.5g/t for 2.0Moz and total inferred resources are 42.9Mt @ 1.6g/t for 2.2Moz. In April 2011 a maiden Tucano Ore Reserve was announced totalling 1.25 million troy ounces (Moz) contained gold. The reserve comprises an open pit Ore Reserve of 19.0Mt @ 1.70g/t gold for 1.04Moz contained gold and a stockpile Ore Reserve of 7.4Mt @ 0.87g/t gold for 0.21Moz contained gold.
Blast hole rig in action
Technical and Resources Manager Paul Tan with Mine Geology Coordinator Ana Gloria N. Rosa
Mine Planning Meeting From left: Raimundo Joelson Catro Silva Mine Surveyor, Walber Gonalves Guimares Mine Supervisor, Fbio Ferreira de Oliveira Coordinator of Mine Planning, Joel Reis dos Santos Mine Surveyor, Luis Daniel Salgado Nunes Mining Engineer.
Excavator Operator AB1
Excavator in action AB2 Figure 2 Location of Gold Pits Tucano
BRAZIL
TUcANo Gold ProJect (Continued)
Blasting AB2 pit
Figure 3 Longsection Urucum gold deposit
In 2011 signicant additional drilling has been completed to both increase the resource and improve the conversion of inferred to indicate resources. A total of 30,000m of resource drilling and 36,000m of RC grade control drilling will be shortly be used to recalculate the resource and reserve at Tucano. Beadell recently purchased a Scramm 685 RC rig which has just arrived in Brazil. The RC rig has the capability of drilling up to 500m deep RC holes and will be used extensively at Tucano for drilling out the 7km strike length of the main trend as well as regional targets, grade control and iron ore. Outstanding new results were received from all the main deposits along the 7km Tucano trend including Tap AB, 14m @ 19.9g/t gold, 18.6m @ 12.5g/t gold and 17.6m @ 11.6g/t gold. A new discovery was made at Tap Sul, located along the southern strike extension of the Tap AB deposit. Results included 6m @ 14g/t gold and 4.6m @ 10.2g/t gold.
The Tucano region is considered highly prospective for additional discoveries and resource extensions along the main 7km long Tucano trend. A major drilling program is underway aiming to increase the resource by targeting a 3Moz addition from the current 4.3Moz JORC resource base. One of the most highly prospective targets is the Urucum Deeps area which will become the focus of an Underground scoping study in 2012. Recent drilling results including FD1315, 43m @ 4.8g/t gold including 23m @ 7.8g/t gold and FD1346, 4m @ 17.5g/t gold and 9m @ 16.2g/t gold, highlight this potential. The drill result in FD1346 is considered to be highly signicant representing the deepest drill intersection at the 2.5Moz Urucum deposit, and remaining completely open at depth.
Beadell Resources Limited Annual AnnualReport Report2009 2011
CIL tanks at completed height
Welding CIL tank

Tap AB2 gold and iron ore open pit
Blasting AB2 pit

7
BRAZIL
TUcANo Gold ProJect (Continued) Iron Ore
The Tucano gold project is highly unique in that signicant deposits of Itabirite Iron ore are coincident with the gold mineralisation. A large operating Iron Ore beneciation plant is located approximately 2km south of the Tap AB gold deposit with iron ore mined from the same Banded Iron Formation that hosts the gold mineralisation. In August 2011, Beadell announced a maiden iron ore resource of 209Mt @ 36.1% Fe. Potential extensions from Tap Sul and Tap Leste areas alone are estimated to contain an additional 120-180Mt of itabirite iron ore(1). Extensive drilling and resampling of gold holes was completed in 2011 at Tap Sul and Tap Leste and the results of this are currently being updated into a new iron ore resource. Large quantities of iron ore is located both within the gold ore and within the optimised gold pits. Beadell is currently stockpiling high grade iron ore and has in excess of 250,000t @ 42% Fe located near the mining concession boundary. Iron ore is currently treated as waste in the mining schedule and pit optimisations and the potential future sale of this material will have a material impact on the economics of the entire gold project.
Beadells in-pit blast hole Drill Rig
Mining at Tap AB
(1) The potential quantity and grade related to Exploration Targets in this report is conceptual in nature as there has been insufcient exploration to dene a Mineral Resource. It is uncertain if further exploration will result in the determination of a Mineral Resource.
Figure 4 Tucano Banded Iron Formation Resource and Target Location
Beadell has completed extensive metallurgical testwork on the iron in the gold ores. The results highlight that a high grade iron concentrate can be extracted at the back end of the gold plant prior to discharge into the tailings dam. Testwork indicates that a conventional magnetic separation plant will produce 400,000 to 500,000t of high grade iron concentrate annually. Detailed engineering drawings are well advanced and long lead time items are out for tender. With a small incremental Capex estimated to be $10-$15M a magnetic separation plant alone has the potential to reduce gold cash costs by 2030% annually.
Under the terms of an Exploration Agreement entered into in 2005 between Beadell Brasil Ltda and Anglo Ferrous Amapa Mineracao Ltda, Anglo Ferrous has undertaken exploration for iron ore within the area of Beadells 100% owned Mining Concession (which work comprises the re-assaying and some additional drilling forming part of the work undertaken to complete the maiden resource described above). If Anglo Ferrous wishes to mine iron ore on Beadells existing Mining Concession, then it must reach agreement with Beadell on terms of a Joint Operating Agreement. No such agreement has yet been reached.
COMMUNITY & ENVIRONMENT

The Tucano project has a long and successful history of social development and support programs and world class environmental governance practices. Numerous community initiatives including the support of local business are evident throughout the district including sh farming and other agricultural grants to help develop small business. Trust funds have also been setup for local duristrictions to fund programs that benet the wider community. The Tucano site provides numerous employment opportunities for locals who overwhelmingly fully support the reestablishment of mining activities at Tucano. Environmental management at Tucano has well established water monitoring systems and a substantial revegetation nursery in place. The widespread use of hydro seeding of disturbed mining areas for rehabilitation and pit wall slope stability has been extremely successful.
Dispatch Room Pamella Carvalho
Environmental team at work From left: Jos Correa and Edvaldo Soares
MD Peter Bowler and GM Silvano Andrade
Amapari River
Tucano Accomadation
View from top of Gold Circuit
10
TArtArUgA ProJect
Total JORC inferred resources of 5.5Mt @ 1.6g/t gold for 279,000 ounces exist at the project, including a higher grade core of mineralisation of 2.1Mt @ 2.7g/t for 185,000 ounces at a 1.5g/t lower cut off. The mineralisation remains open in all directions with excellent potential to rapidly increase the resource with additional drilling at the Jabuti and Rio de Ouro targets. An aeromagnetic and radiometric survey was recently own with several new targets areas identied for follow up drilling. A large resource drilling program using the new RC drill rig is planned for the second quarter 2012
Loading of Track Mounted RC Rig bound for Tucano
Enviromental team at work
Enviromental team at work Rayssa Amaral Barros; Biologist
11
AUSTRALIA
Figure 5 Australian projects Location Plan
TROPICANA EAST
The Tropicana East Project is located adjacent to the Anglogold Ashanti/Independence Group 6.4Moz Tropicana gold development project, 350km north-east of Kalgoorlie in Western Australia. Beadell has identied a 15m long zone of highly anomalous gold named the Hercules Shear Zone, located 60km along strike from Tropicana. The gold mineralisation is masked by approximately 30m of transported overburden. In December 2010, Beadell announced the discovery of signicant gold mineralisation at the Atlantis prospect at the southern end of the Hercules Shear Zone. Aircore drill results included 15m @ 24.8g/t gold and 19m @ 12.1g/t gold. First pass RC drilling at Atlantis in 2011 determined an unexpected moderate northwest dip of the mineralised shear zone with RC results including 3m @ 5.8g/t gold, 2m @ 7.7g/t gold and 2m @ 24.9g/t gold. A second zone of gold mineralisation was intersected a further 5km to the northeast at the Hercules prospect. Results included 19m @ 1.3g/t gold, 3.3m @ 2.2g/t gold and a composite result of 10m @ 7.8g/t gold. The Atlantis and Hercules prospects represent signicant early stage gold discoveries, located along the 15km long, sparsely drilled Hercules Shear Zone. Figure 6 Tropicana East project showing location of Atlantis and Hercules prospects on aeromagnetics
Figure 7 Tropicana East project showing location of Atlantis and Hercules prospects on aeromagnetics
12 Beadell Resources Limited Annual Report 2011
WEST MUSGRAVE Handpump Prospect

The Handpump prospect located in the remote West Musgrave province of Western Australia, represents the rst signicant gold mineralisation to be intersected in the entire Musgrave block. Gold mineralisation is associated with a rhyolite dome breccia with associated potassic alteration. Additional tenure has been secured in the area and rst pass exploration sampling are planned to look for extensions and repetitions of the gold mineralisation identied to date.
LAKE MACKAY
Joint venture partners, Meteoric Resources Ltd have identied several strong aeromagnetic anomalies considered to be excellent IOCG targets at Lake Mackay. Follow up work is being planned.
VICTORIA Reedy Creek Project

A JORC inferred resource of 609 000t @ 2.4g/t gold for 47,000 ounces of gold exists at the Reedy Creek project. Gold and antimony mineralisation is associated with dolerite dyke host with mineralisation open at depth and excellent potential to dene additional ore shoots within the 800m strike between Golden Dyke and Apollo.
Skirmish Hill JV
The Skirmish Hill project covers an area of 560km2 in three contiguous granted tenements 80km southeast of BHPBs Nebo-Babel nickel deposit. The project is considered highly prospective for nickel sulphide, platinum group elements, and copper-gold mineralisation. Joint Venture partners Anglo American will complete rst pass RC drill testing of geophysical and geochemical anomalies in the near furure.
Geological Survey of Western Australia eld trip to Tropicana belt
Geological Survey of Western Australia eld trip to Tropicana belt
13
resoUrce & reserves

In 2011, Beadell announced increased JORC resources totalling 96.6Mt @ 1.5g/t gold for 4.6Moz, a maiden gold reserve of 26.4Mt @ 1.47g/t gold for 1.25Moz at Tucano in Brazil and a maiden JORC Iron ore resource of 209Mt @ 36.1% Fe at Tucano (Table 1).
Gold Resources
Brazil Tonnes ('000) Tucano Urucum Tapereba AB Tapereba C Tapereba D Duckhead Total Oxide Urucum Tapereba AB Tapereba C Tapereba D Total Primary Spent Ore Low Grade Total Stockpile Total Tucano Tartaruga Total Brazil Australia Tonnes ('000) Reedy Creek Beadell Total 7353 0.87 206 40176 1.51 1953 7353 0.87 Measured Grade g/t Au Ounces Tonnes ('000) ('000) 206 40176 1.51 Indicated Grade g/t Au Ounces Tonnes ('000) ('000) 609 49025 1953 5808 1545 7353 7353 0.85 0.95 0.87 0.87 159 47 206 206 40176 1.51 1953 42916 5500 48416 1.56 1.6 1.56 Inferred Grade g/t Au 2.4 1.57 Ounces Tonnes ('000) ('000) 47 2476 609 96554 2150 279 2429 10571 21049 7837 318 401 29605 1.54 1.62 1.23 1.25 1.09 1.50 522 1095 309 13 14 1431 3036 4712 1699 1124 1.21 1.88 1.39 1.22 118 284 76 44 4708 1985 1835 287 115 8930 19974 10755 2665 592 33986 1.43 1.32 1.04 1.58 17.06 1.53 1.67 1.47 1.25 1.2 1.26 217 84 61 15 63 440 1071 509 107 23 1709 7744 6697 3534 1411 115 19501 41023 18591 2983 993 63591 5808 1545 7353 90445 5500 95945 1.34 1.71 1.21 1.29 17.06 1.54 1.64 1.37 1.25 1.16 1.54 0.85 0.95 0.87 1.48 1.6 1.49 Total Grade g/t Au 2.4 1.49 Ounces ('000) 47 4634 335 369 137 59 63 962 2165 817 120 37 3139 159 47 206 4308 279 4587 Measured Grade g/t Au Ounces Tonnes ('000) ('000) Indicated Grade g/t Au Ounces Tonnes ('000) ('000) Inferred Grade g/t Au Ounces Tonnes ('000) ('000) Total Grade g/t Au Ounces ('000)
Gold Reserves
Tucano Tonnes (million) Urucum Oxide Tapereba AB Oxide Tapereba C Oxide Tapereba D Oxide Total Oxide Urucum Sulphide Tapereba AB Sulphide Tapereba C Sulphide Tapereba D Sulphide Total Sulphide Spent Ore Low Grade Total Stockpiles Proved Grade g/t Au Ounces Tonnes ('000) (million) 3.2 2.5 1.1 0.3 7.1 9.8 1.8 0.3 0.0 11.9 Probable Grade g/t Au 1.21 2.14 1.53 1.30 1.59 1.69 2.17 1.77 1.97 1.76 Ounces Tonnes ('000) (million) 124 173 53 12 362 534 127 15 2 677 3.2 2.5 1.1 0.3 7.1 9.8 1.8 0.3 0 11.9 Total Grade g/t Au 1.21 2.14 1.53 1.3 1.59 1.69 2.17 1.77 1.97 1.76 Ounces ('000) 124 173 53 12 362 534 127 15 2 677 Cut-off Grade g/t Au 0.63 0.60 0.64 0.37 0.61 0.72 0.68 0.72 0.45 0.71
5.8 1.5 7.4 7.4
0.85 0.95 0.87 0.87
159 47 206 206 19 1.70 1039
5.8 1.5 7.4 26.4
0.85 0.95 0.87 1.47
159 47 206 1245 0.65
Total Tucano
14
Iron Ore Resources

Tucano > 25% Fe cut off Resource Class Measured Tonnes (million) 0.1 17.4 14.3 31.7 2.6 44.3 101.4 148.4 0.2 10.9 Fe % 40.4 37.4 38.5 37.9 41.0 39.1 34.8 36.2 30.3 28.8 SiO2 % Al2O3 % TiO2 % P % Mn % K 2O % LOI
18.9 23.1 23.5 23.2 25.4 27.7 29.6 29.0 45.8 44.6 25.8 32.9 26.5 29.1 28.5 28.7
13.4 10.9 8.9 10.0 5.1 6.7 9.4 8.5 0.9 1.0 6.1 4.1 5.0 6.8 8.9 8.1
1.1 0.7 0.5 0.6 0.3 0.4 0.3 0.2 0.1 0.1 0.1 0.1 0.3 0.4 0.2 0.2
0.05 0.07 0.08 0.07 0.13 0.11 0.16 0.14 0.08 0.09 0.16 0.14 0.13 0.10 0.15 0.13
0.3 1.2 2.0 1.5 2.4 1.9 2.1 2.0 0.4 0.7 2.7 1.9 2.2 1.5 2.1 1.9
0.0 0.1 0.1 0.1 0.1 0.2 0.4 0.1 0.1 0.1 0.3 0.1 0.1 0.1 0.1 0.1
10.5 8.9 8.4 8.7 5.0 5.3 7.8 7.0 0.2 1.0 5.1 3.6 4.8 5.5 7.5 6.8
Colluvium
Indicated Inferred Total Measured
Friable Oxide
Indicated Inferred Total Measured
Friable Transitional
Indicated Inferred Total
18.1 29.1 2.9 72.5 133.7 209.1
36.5 33.6 40.4 37.2 35.4 36.1
Measured Total Tucano Indicated Inferred Total
Competency Statement Gold Resources Mineral resources were calculated using Ordinary Kriging (OK) methodology. The resources have been reported using a 0.5 g/t lower cut off. Top cuts vary between lodes and deposits, according to the statistical distributions of the grades. The resources have been divided into oxide and primary domains. For the purposes of reporting, the transitional material has been included as oxide. The information in this report relating to Tucano Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr Daniel Guibal who is a member of the Australian Institute of Mining and Metallurgy and has sufcient exploration experience which is relevant to the various styles of mineralisation under consideration to qualify as a Competent Person as dened in the 2004 Edition of the Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Guibal is a full time employee of SRK and he consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. The information in this report relating to Tartaruga and Reedy Creek Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr Robert Watkins who is a member of the Australian Institute of Mining and Metallurgy and has sufcient exploration experience which is relevant to the various styles of mineralisation under consideration to qualify as a Competent Person as dened in the 2004 Edition of the Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Watkins is a full time employee of Beadell Resources Ltd and he consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Gold Reserves The information in this report relating to Open Pit Gold Ore Reserves is based on information compiled by Mr Sjoerd Rein Duim who is a member of the Australian Institute of Mining and Metallurgy and who has sufcient experience which is relevant to the styles of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as dened in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Duim is a full time employee of SRK Consulting and consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. The information in this report relating Stockpile Gold Ore Reserves is based on information compiled by Mr Robert Watkins who is a member of the Australian Institute of Mining and Metallurgy and has sufcient exploration experience which is relevant to the various styles of mineralisation under consideration to qualify as a Competent Person as dened in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Watkins is a full time employee of Beadell Resources Ltd and he consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Iron Resources Mineral resources were calculated using Ordinary Kriging (OK) methodology. The resources have been reported using a 25% Fe lower cut off. All Mineral Resources are stated as wet metric tonnes, assays in dry basis. The information in this report relating to Tucano Mineral Resources or Ore Reserves is based on information compiled by Mr Daniel Guibal who is a member of the Australian Institute of Mining and Metallurgy and has sufcient exploration experience which is relevant to the various styles of mineralisation under consideration to qualify as a Competent Person as dened in the 2004 Edition of the Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Guibal is a full time employee of SRK and he consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. The information in this report relating to Exploration targets is based on information compiled by Mr Robert Watkins who is a member of the Australian Institute of Mining and Metallurgy and has sufcient exploration experience which is relevant to the various styles of mineralisation under consideration to qualify as a Competent Person as dened in the 2004 Edition of the Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Watkins is a full time employee of Beadell Resources Ltd and he consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Under the terms of an Exploration Agreement entered into in 2005 between Beadell Brasil Ltda and Anglo Ferrous Amapa Mineracao Ltda, Anglo Ferrous has undertaken exploration for iron ore within the area of Beadells 100% owned Mining Concession (which work comprises the re-assaying and some additional drilling forming part of the work undertaken to complete the maiden resource described above). If Anglo Ferrous wishes to mine iron ore on Beadells existing Mining Concession, then it must reach agreement with Beadell on terms of a Joint Operating Agreement. No such agreement has yet been reached.
15
TENEMENT SCHEDULE
Interests in mining tenements.
At the date of the Directors Report, the Companys interests in signicant mining and exploration tenements were as follows:
Area (Km2) 467 416.9 210.2 216 216 215.4 557.2 560 215.4 129.3 606.9 411.8 27.4058 5 0.1406 0.7646 34.53 80.6479 917.385 74.1148 99.08 88.094 100 83.9939 61.9873 449.407 397.141 447.208 552.963 97.931 898.286 474.661 875.006 91.904 32.623 228.902 100 64.377 930.009 637.128 88.094 100 982.885 Interest % 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 70 100 70 70 100 100 100 100 70 70 100 100 100 100 100 100 100 100 100 70 100 100 100 100 100 100 70 Area (Km2) 63.6 63.6 63.6 232.1 71 485 358.4 898.241 96 1.2393 969.063 100 100 788.408 93.088 863.436 137.685 36.4799 2.9142 806.479 262.134 88.0941 982.885 22.659 311.072 0.1278 832.944 487.078 252.746 9.714 839.939 4.9554 0.6903 93.229 0.0078 0.0139 5.5622 47.315 Interest % 30 30 100 30 100 100 100 100 100 100 100 100 100 100 100 100 70 100 100 70 100 100 70 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 70 100 70
Location Tropicana (WA) Tropicana (WA) Tropicana (WA) Musgrave (WA) Musgrave (WA) Musgrave (WA) Naretha (WA) Zanthus (WA) Musgrave (WA) Musgrave (WA) Musgrave (WA) Musgrave (WA) Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano
Description E38/1913 E39/1215 E69/2585 E69/2066 E69/2067 E69/2150 E28/2174 E28/2215 E69/2151 E69/2152 E69/2780 E69/2781 3264/1953 2757/1959 801225/1977 851528/1980 850852/1987 850853/1987 850857/1987 850858/1987 850859/1987 850860/1987 850863/1987 850864/1987 850865/1987 850866/1987 851676/1992 852730/1993 852730/1993 854262/1993 851766/1994 851770/1994 851771/1994 852336/1994 855033/1994 855037/1994 855399/1994 858017/1995 858050/1995 858051/1995 858076/2009 858045/2009 858078/2009
Location Lake MacKay (WA) Lake MacKay (WA) Lake MacKay (WA) Lake MacKay (WA) Reedy Creek (VIC) Reedy Creek (VIC) Naretha West (WA) Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano
Description E80/3820 E80/3821 E80/3822 E80/3823 EL 4460 EL 4987 E28/2175 858062/1995 858092/1996 858263/1996 858264/1996 858265/1996 858000/1998 858010/1999 858010/1999 858012/1999 858038/1999 858073/2001 858052/2002 858053/2002 858060/2002 858012/2003 858013/2003 858037/2003 858042/2003 858013/2004 858016/2004 858017/2004 858054/2004 858062/2004 858086/2004 858114/2004 858065/2005 858001/2006 858068/2006 858001/2007 858049/2007
Brazil, Tartarugalzhino DNPM. 851.439/1980
Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano Brazil, Tucano
858078/2007 858063/1995 858076/2009 858077/2009 858046/2009
0.4984 52.175 880.941 12.393 262.134
16
DIRECTORS REPORT
For the year ended to 31 December 2011
The directors present their report together with the nancial report of the Beadell Resources Limited (the Company) Group, being the Company and its subsidiaries, for the year ended 31 December 2011 (the period) and the auditors report thereon.
1. DIRECTORS
The directors of the Company at any time during or since the end of the period are:
Name and qualications

Mr Craig Readhead B.Juris, LL.B Independent Non-Executive Director Chairman Appointed 14 April 2010
Experience, special responsibilities and other Directorships

Mr Readhead is a lawyer with over 30 years legal and corporate advisory experience with specialisation in the resources sector, including the implementation of large scale mining projects both in Australia and overseas. Mr Readhead is a former president of the Australian Mining and Petroleum Law Association and is a partner of specialist mining and corporate law rm, Allion Legal. Mr Readhead is currently a director of Heron Resources Ltd, Mount Gibson Iron Ltd, General Mining Corporation Ltd, India Resources Ltd, Frankland River Olive Company Ltd and Galaxy Resources Ltd. Mr Readhead is Chairperson of the Remuneration and Nomination Committee and the Audit Committee.
Dr Michael Donaldson BA (Hons), PhD, MAIG, MAICD Independent Non-Executive Director Appointed 31 July 2007
Dr Donaldson has over 30 years experience in the minerals industry, including 15 years with Western Mining Corporation in nickel, gold and base metals exploration. Dr Donaldson was the Exploration Manager of Coolgardie Gold NL, and General Manager Exploration with Sons of Gwalia Ltd and Ashton Mining Ltd, and General Manager Mapping with the Geological Survey of Western Australia. More recently Dr Donaldson was Group Chief Geologist with AIM-listed Lithic Metals and Energy. Dr Donaldson is a member of the Remuneration and Nomination Committee and the Audit Committee.
Mr Jim Jewell B.Eng (Hons), ACSM, MAusIMM Non-Executive Director Appointed 14 April 2010
Mr Jewell is a Mining Engineer with over 30 years experience in the extraction of Gold, Nickel, Tin and Uranium. He has a strong technical and operations background, having been a Mine General Manager in Western Australia for 7 years and has also been responsible for the execution of numerous large mining projects overseas. Mr Jewell is a member of the Remuneration and Nomination Committee.
Mr Ross Kestel B.Bus, CA, MAICD Non-Executive Director Appointed 29 February 2012
Mr Kestel has acted as a director and company secretary of a number of public companies involved in mineral exploration, mining, mine services, property development, manufacturing and technology industries and was a director of a mid tier accounting practice for over 25 years. Mr Kestel is currently a non executive director of Regis Resources Ltd, Equator Resources Ltd, Xstate Resources Ltd, Jatenergy Ltd and Resource Star Ltd. During the past three years he has also served as a non executive director of the ASX listed companies VDM Group Ltd, Jabiru Metals Ltd and Dioro Exploration NL. Mr Kestel is a member of the Remuneration and Nomination Committee and the Audit Committee.
17
DIRECTORS REPORT
For the year ended to 31 December (continued) 1. DIRECTORS (CONTINUED)
Mr Bowler has most recently been the Managing Director of Agincourt Resources Ltd and was instrumental in driving its rapid growth. He was also a founding Director of Nova Energy Ltd. As Managing Director of Agincourt Resources Ltd, he facilitated the takeover by Oxiana Ltd in April 2007. Mr Bowler was previously the Director of Operations for Agincourt Resources Ltd and responsible for all facets of the Wiluna Gold Operation including contract negotiations, overseeing feasibility studies, employee health and welfare, completion of sensitive heritage clearances with local indigenous communities, environmental management and business development. Mr Watkins is the former Exploration Manager for Agincourt Resources Ltd and has over 20 years exploration experience in Australia, Brazil, Indonesia and Africa where he has a track record of exploration success.
Mr Peter Bowler Dip Farm Management (Hons) Managing Director Appointed 3 May 2007
Mr Robert Watkins BSc (Hons), MAusIMM Exploration Director Appointed 3 May 2007
2. COmpAnY SECRETARY
Mr Gregory Barrett CA, FFin, B.Comm has held the position of company secretary since 2007. Mr Barrett has over 20 years management, corporate advisory, nance and accounting experience working for several listed and unlisted public companies for which he has held the role as company secretary for over 15 years. He is the former nance executive and Company Secretary for Agincourt Resources Ltd and had previously worked for KPMG before specialising in the mining industry. Mr Barrett is also the Companys Chief Financial Ofcer.
3.
DIRECTORS MEETINGS
The number of directors meetings and number of meetings attended by each director in the capacity of director of the Company from beginning to end of the period are: Audit Committee Meetings A B 2 2 2 2 2 2 Remuneration & Nomination Committee Meetings A B 1 1 1 1 1 1 -
Director Mr Craig Readhead Mr Jim Jewell Dr Michael Donaldson Mr Peter Bowler Mr Robert Watkins
Board Meetings A B 12 12 10 12 11 12 12 12 12 12
A Number of meetings attended B Number of meetings held while in ofce
4. CORpORATE gOVERnAnCE STATEmEnT

This statement outlines the main corporate governance practices in place throughout the period, which comply with the ASX Corporate Governance Council recommendations, unless otherwise stated.
4.1
BOARd OF dIRECTORS
Role of the board

The Boards primary role is the protection and enhancement of long-term shareholder value and to this end the Company has established functions reserved to the board and those delegated to senior executives, as set out in the Boards Charter located on the Companys website (www.beadellresources.com.au). In summary; The Board is responsible for the overall corporate governance of the Group including formulating its strategic direction, approving and monitoring capital expenditure, setting remuneration, appointing, removing and creating succession policies for directors and senior executives, establishing and monitoring the achievement of managements goals, ensuring the integrity of internal control and management information systems and approving and monitoring nancial and other reporting.
The Board has delegated responsibility for the operation and administration of the Company to the Managing Director and the executive management team. The Board Charter supports this delegation of responsibility by formally dening the specic functions reserved for the Board and those matters delegated to management. The Companys Statement on Board and Management Functions is available on the Companys website.
Composition of the board

The names of the directors of the Company in ofce at the date of this report are set out in the Directors report in Section 1 of this report. The composition of the board is determined using the following principles: a minimum of 3 directors, but no more than 10 directors, a maximum period of 3 years service, eligible for re-election, one third of all directors must retire at each annual general meeting, and are eligible for re-election. The Boards policy for determining the selection and appointment of new directors includes consideration of: the quality of the individual, background of experience and achievement, compatibility with other Board members, credibility within the Groups scope of activities, intellectual ability to contribute to Boards duties, and; physical ability to undertake Boards duties and responsibilities. The Board aims to achieve differing skills, expertise and diversity in its composition. Directors are initially appointed by the full Board subject to election by shareholders at the next general meeting. The Board supports the principle of having a majority of independent directors. However, it is mindful that in the early stages of the Companys development other competing priorities which may impact on the Boards structure could be of greater importance, in terms of increasing shareholder value, than having a Board consisting of a majority of independent directors. The Chairman is a non-executive independent director.
Board processes
To assist in the execution of its responsibilities the Board has established an Audit Committee and a Remuneration and Nomination Committee. These committees have written mandates and operating procedures, which are reviewed as necessary. The Board regularly and closely monitors the Companys nancial performance and ensures that accurate and timely reporting systems are established. The Board has implemented internal procedures designed to provide reasonable assurance as to the effectiveness and efciency of operations, the reliability of nancial reporting and compliance with relevant laws and regulations. The full Board holds 12 scheduled meetings each year, plus strategy meetings and any extraordinary meetings at such other times as may be necessary to address any specic signicant matters that may arise. No Director participates in any deliberation regarding his own remuneration or related issues. The agenda for meetings is prepared in conjunction with the Chairman, Executive Directors and Company Secretary. Standing items include the nancial reports, strategic matters, governance and compliance. Submissions are circulated in advance. Executives are regularly involved in board discussions and directors are in continual contact with the wider group of employees.
Independent professional advice and access to company information

Each director has the right of access to all relevant Company information and to the Companys executives and, subject to prior consultation with the Chairman, may seek independent professional advice from a suitably qualied adviser at the Groups expense. The director must consult with an advisor suitably qualied in the relevant eld, and obtain the Chairmans approval of the fee payable for the advice before proceeding with the consultation. A copy of the advice received by the director is made available to all other members of the board.
4.2 REmunERATIOn And NOmInATIOn COmmITTEE

The Remuneration Committee reviews and makes recommendations to the Board on remuneration packages and policies applicable to the executive ofcers and Directors of the Company and other executives of the Group. It is also responsible for matters regarding appointment and induction processes for directors and committee members and succession planning.
19
DIRECTORS REPORT
For the year ended to 31 December 2011 (continued) 4. CORpORATE gOVERnAnCE STATEmEnT
the capability and experience of the key management personnel, the key management personnels ability to control the relevant segments performance, the Groups performance regarding exploration and/ or acquisition success as reected by growth in share price and delivering constant returns on shareholder wealth. Compensation structures may include xed and performance linked compensation and share based payments.
4.2 REmunERATIOn And NOmInATIOn COmmITTEE (CONTINUED)

The members of the Remuneration and Nomination Committee during the period were: Mr C Readhead (Chairman) Independent Non Executive Dr M Donaldson Independent Non Executive Mr M Jewell Non Executive The Board policy is that the Remuneration and Nomination Committee will comprise of three Non Executive Directors. The Committee consists of a majority of independent directors. The Companys directors and executive ofcers may be invited to Remuneration and Nomination Committee meetings, as required, to discuss director and senior executives performance and remuneration packages. No Director or executive ofcer may participate during discussions regarding the determination of their own remuneration package at Committee meetings. The Remuneration and Nomination Committee meets at least once per year and additionally as required. The Committee met during the period and committee members attendance record is as disclosed in section 3 of this report. The Remuneration and Nomination Committee Charter is available on the Companys website.
Fixed compensation
Fixed compensation consists of base compensation (which is calculated on a total cost basis and includes any FBT charges), as well as employer contributions to superannuation funds.
Performance linked compensation

Performance linked compensation includes both short term and long term incentives, and is designed to reward key management personnel for meeting or exceeding their nancial and personal objectives. The short term incentive and long term incentive programs are described below.
Short term incentive program cash bonuses

Each year the Remuneration and Nomination Committee determines if any cash bonuses will be provided to key management personnel and if so, what performance hurdles that must be achieved in order for bonuses to become payable. Performance hurdles are chosen that align the individuals reward with the Groups strategy and performance. Performance hurdles currently include achievement of construction and operational milestones within time periods and budgets determined by the Remuneration and Nomination Committee.
4.3 REmunERATIOn REpORT AudITEd 4.3.1 Principles of compensation audited

Key management personnel have authority and responsibility for planning, directing and controlling the activities of the Group, including directors of the Company and other executives. Key management personnel comprise the directors of the Company and executives of the Group. Compensation levels for key management personnel and secretaries of the Group are competitively set to attract and retain appropriately qualied and experienced directors and executives. The Board of Directors determines compensation packages of the Group given trends in comparative companies and the objectives of the Groups compensation strategy. The compensation structures explained below are designed to attract suitably qualied candidates, reward the achievement of strategic objectives, and achieve the broader outcome of creation of value for shareholders. The compensation structures take into account:
Long term incentive program share based payments

Each year the Remuneration and Nomination Committee determines if any share based payments will be provided in the form of options over ordinary shares of the Company under the rules of the Employee Share Option Plan (ESOP). Terms of ESOP Key terms of the ESOP include: options are issued at no cost to directors and employees, directors may limit the total number of options which may be exercised under the ESOP in any year, options shall lapse upon the earlier of;
20
the expiry of the exercise date, the option holder ceasing to be an employee by reason of dismissal, resignation or termination of employment, ofce or services for any reason, the expiry of 30 days after the option holder ceases to be an employee by reason of retirement, or; a determination by directors that the option holder has acted fraudulently, dishonestly or in breach of his or her obligations to the Group. shares issued pursuant to the exercise of carry the same rights and entitlements as other shares on issue; and options are not quoted on the ASX. Performance hurdles Options issued may contain a requirement to achieve performance hurdles for the options to vest and become exercisable. No options granted in the period contained performance hurdles other than vesting conditions. All performance hurdles in respect of options previously granted have been achieved.
Other benets
With the exception of Mr Silvano Andrade (General Manager Operations Brazil), key management personnel are not entitled to receive additional benets as part of the terms and conditions of their appointment. Mr Andrade receives various non cash insurance benets as part of the terms and conditions of his employment.
Salary and performance review

The salary and performance of directors and senior executives is evaluated annually by the Remuneration and Nomination Committee. The Remuneration and Nomination Committee considers individual, segment and overall performance of the Group when evaluating the performance of directors and senior executives. External consultants may be engaged to provide analysis and advice to ensure the directors and senior executives compensation is competitive in the market place. The Remuneration and Nomination Committee met on 15 September 2011, at which point the annual review process described above was conducted. External consultants, McDonald & Company (Australasia) Pty Ltd (McDonald), were engaged during the period and provided recommendations in a report to the Committee. The Group paid McDonald a total of $9,500 in relation to these services. McDonald did not provide any other services to the Group during the period.
Consequences of performance on shareholder wealth

The Group currently has no producing mines, accordingly the only meaningful measure of Group performance is change in share price, as set out in the table below: 31 December 2011 31 December 2010 Share price $0.60 $0.67
Service contracts
It is the Groups policy that service contracts for key management personnel are unlimited in term and capable of termination by either party. All service contracts with key management personnel, with the exception of Mr Andrade require 3 months written notice. Mr Andrades contract requires 30 days written notice. In the case of wilful or fraudulent misconduct, the Group retains the right to terminate all service contracts without notice. Key management personnel are entitled to receive on termination of employment their statutory entitlements, including any accrued annual and long service leave, together with any superannuation benets. Each service contract outlines the components of compensation paid to the key management personnel but does not prescribe how compensation levels are modied year to year.
Non-executive directors
Non-executive directors may receive up to $70,000 in base remuneration. The Chairperson may receive up to $130,000 in base remuneration.
21
22
4.
Salary & Non cash Super (post Share based fees (short Cash bonus Benets employpayments term) (short term) (short term) ment) (options) Total $ % % $ $ $ $
Value of Performance options of related total
12 months ended 31 December 2011 Directors 98,000 52,000 52,000 58,055 260,055 26,933 100,404 7,371,319 9,332.299 7,354 (16,491)** 131,730 19,579 161,459 394,229 -% -% 26,978 282,657 661,385 51% 26,978 2,042,263* 2,420,991 87% 41,417 4,084,525* 4,684,134 89% 87% 84% 43% 41% -% 5,031 204,227* 265,153 77% 77% 204,227* 263,225 78% 78% 408,452* 511,452 80% 80%
Mr Readhead, Chairman
103,000
Mr Jewell
58,998
DIRECTORS REPORT
Dr Donaldson
55,895
Executive directors
4.3 REmunERATIOn REpORT AudITEd
For the year ended to 31 December 2011 (continued)
4.3.2 Directors and executive ofcers remuneration audited
Details of the nature and amount of each major element of remuneration of each director of the Company and other key management personnel are as set out following:
Mr Bowler, Managing Director
460,192
Mr Watkins, Exploration Director
299,750
Executives
299,750
CORpORATE gOVERnAnCE STATEmEnT
155,136
140,867
Mr Barrett, Company Secretary, CFO Mr Andrade, GM Operations Brazil (appointed 12 July 2011) Mr Torresini, GM Operations Brazil (resigned 6 May 2011) Total compensation (Group)
1,573,588
The Board of Directors resolved to issue options to Directors and employees on 20 July 2010. At the time of the resolution, the options were issued at a 4% discount to the Companys 30 day VWAP. Director options were approved by Shareholders on 29 November 2010. In the period from Directors resolution to Shareholder approval the Companys share price increased 285%. When this signicantly increased share price and associated volatility are used as inputs in the Black and Scholes Option Pricing Model to value the options for accounting purposes, the resultant accounting value is signicantly higher than other options resolved to be issued by Directors on 20 July 2010 that did not require Shareholder approval some 4 months later.
** Mr Torresinis 750,000 options were forfeited during the period due to failure to meet vesting conditions. Share based payments expenses in relation to these options were reversed in the period.
6 months ended 31 December 2010
Directors 2,025 15,750 11,700 11,700 41,175 39,251* 19,625* 19,625* 392,507* 196,253* 230,626 16,491** 914,378 75,501 43,625 44,150 583,257 337,953 372,326 146,201 1,603,013 52% 45% 44% 67% 58% 62% 11% 52% 45% 44% 67% 58% 62% 11%
Mr Readhead, Chairman
36,250
Mr Jewell
24,000
Dr Donaldson
22,500
Executive directors
Mr Bowler, Managing Director
175,000
Mr Watkins, Exploration Director
130,000
Executives
Mr Barrett, Company Secretary, CFO
130,000
Mr Torresini, GM Operations Brazil
129,710
Total compensation (Group)
647,460
4.3.3 Cash bonuses included in remuneration audited

Details of cash bonuses included as remuneration for each relevant Key Management Person are detailed below. Included in remuneration $ 12 months ended 31 December 2011 Directors Mr Bowler Mr Watkins Executives Mr Barrett Mr Andrade 98,000 52,000 52,000 58,055 100% 100% 100% 100% -% -% -% -% Superannuation Vested in period $
Total $
No cash bonuses have been awarded to key management personnel in prior periods. Amounts included in remuneration for the period represent the amount that vested based on achievement of personal goals and satisfaction of specied performance criteria. No amounts vest in future periods in respect of bonus schemes for the period.
4.3.4 Options over equity instruments granted as compensation audited

All options refer to options over ordinary shares of the Company, which are exercisable on a one for one basis according to the rules of the ESOP. Exercise of options No options granted as compensation were exercised during the period nor comparative period. Forfeiture of options Mr Torresinis 750,000 options were forfeited during the period due to failure to meet vesting conditions. No other options lapsed during the period, nor comparative period. Vesting of options All options granted have vested as at the end of the period, with the exception of 400,000 options granted to Mr Andrade. 200,000 options granted to Mr Andrade vest on 12 July 2012 and the remaining 200,000 vest on 12 July 2013. Grant of options since the end of the period No options have been granted to key management personnel since the end of the period. Details of options granted as compensation Details of options over ordinary shares in the Company that were granted as compensation to each Key Management Person during the reporting period and details on options that vested or were forfeited are presented in the table 4.3.6. All options have been provided at no cost to recipients. Modication of terms No terms of options granted to key management personnel as compensation have been altered or modied during the period or the prior period.
4.3.5 Payments to persons before taking ofce audited

There were no payments made to persons before taking ofce during the period.
23
DIRECTORS REPORT
For the year ended to 31 December 2011 (continued) 4. CORpORATE gOVERnAnCE STATEmEnT 4.3 REmunERATIOn REpORT AudITEd 4.3.6 Options over equity instruments granted as compensation: vesting, forfeiture and exercise audited
Options granted prior period Number of options granted 12 Months ended 31 December 2011 Directors Mr Readhead, Chairman Mr Jewell Dr Donaldson Mr Bowler Mr Watkins Executives Mr Barrett Mr Andrade Mr Torresini 6 months ended 31 December 2010 Directors Mr Readhead Mr Jewell Dr Donaldson Mr Bowler Mr Watkins Executives Mr Barrett Mr Torresini 500,000 -% -% -% -% 500,000 500,000 500,000 -% -% -% -% -% -% -% -% -% -% 5,000,000 750,000 100% -% -% -% -% 100% 1,000,000 500,000 500,000 10,000,000 5,000,000 100% 100% 100% 100% 100% -% -% -% -% -% % vested in current period % forfeited in current period
Options that vested to directors and Mr Barrett in the period were subject service conditions and performance hurdles in the form of a one year service period from grant date and a decision to mine at the Tucano Gold Project. Both the service condition and performance hurdle were satised in respect of these options. Options the vested to Mr Andrade contained only service conditions, which were satised.
24
Options granted current period % forfeited in current period fair value per option at grant date $ Number of options vested in period Number of options vested
% vested
% forfeited
grant date
expiry date
1,000,000 600,000 -% -% -% -% -% -% 33% -% -% -% -% -% -% -% -% -% 12 July 2011 0.43 31 December 2014 500,000 500,000 10,000,000 5,000,000
1,000,000 500,000 1,000,000 10,500,000 5,500,000
5,000,000 200,000 -
5,000,000 200,000 -
1,000,000 500,000 500,000 10,000,000 5,000,000 5,000,000 750,000
-% -% -% -% -% -% -%
-% -% -% -% -% -%
29 November 2010 29 November 2010 29 November 2010 29 November 2010 29 November 2010
0.44 0.44 0.44 0.44 0.44
31 December 2014 31 December 2014 31 December 2014 31 December 2014 31 December 2014
500,000 500,000 10,000,000 5,000,000
500,000 1,000,000 10,500,000 5,500,000
20 July 2010 6 December 2010
0.10 0.35
31 December 2014 31 December 2014
5,000,000 -
5,000,000 -
25
DIRECTORS REPORT
For the year ended to 31 December 2011 (continued) 4.4 AudIT COmmITTEE
The Audit Committee has a documented charter, approved by the Board. The Committee must have at least three members; all members must be non executive directors with a majority being independent. The Committee advises on the establishment and maintenance of a framework of internal control and appropriate ethical standards for the management of the Group. The members of the Audit Committee during the year were: Mr Readhead, B.Juris, LL.B Independent Non Executive Chairman Dr Donaldson, BA (Hons) PhD Independent Non Executive Mr Jewell, B.Eng (Hons) Non Executive The external auditors are invited to all Audit Committee meetings. Directors and executives of the Company may also be invited to committee meetings, at the discretion of the Committee. The Committee met once during the period and committee members attendance is disclosed in section 3. The Audit Committee Charter is available on the Companys website. system rest with management. The Audit Committee is responsible for reviewing the Groups risk management systems and internal nancial control systems.
Reporting of risk management

The Managing Director reports on risk management, using an exception reporting basis as required, to the full Board as part of his report to directors at each Board meeting. The Managing Director reports annually to the Board regarding the effectiveness of the Companys management of its material business risks (refer below Statement on management of risks).
Risk Management Strategy

The Groups business is subject to general risks and certain specic risks. In accordance with the Groups Risk Management Policy, the Group has: identied strategic risks that may impact upon the Groups business; assessed and prioritised those risks, and; developed and implemented a Risk Management Strategy to manage the effects of identied material risks. The Board of Directors has overall responsibility for the establishment and oversight of the Risk Management Strategy as required by the Risk Management Policy.
4.5 RISk mAnAgEmEnT

The Companys risk management system incorporates all policies, processes and practices established by management and/or the Board to provide reasonable assurance that: established corporate strategies and objectives are met; risks are identied, assessed and adequately monitored and managed; signicant nancial, managerial and operating information is accurate, relevant, timely and reliable; material changes to the Companys risk management prole are promptly identied; and policies, standards, procedures and applicable laws, regulations and licences are complied with. The Companys risk management policy is available on the Companys website. The Groups risk management system is summarised below.
Risk management and internal control

The Group has designed and implemented an internal control system to mitigate material risks, however, the Board recognises that no cost-effective internal control system will preclude all errors and irregularities. The following is a summary of the key internal control systems the Group has in place:
Financial
There is a budgeting system with a budget approved annually by the Board of Directors. Monthly actual results (including comparison to budget) are reported to the Board monthly. Revised forecasts for the year are prepared when facts and circumstances assumed in the budget have materially changed. The Group reports its nancial results to shareholders on a half yearly basis. Practices have been established to ensure business transactions and commitments are properly authorised and executed and nancial exposures are controlled. The Group is exposed to credit, liquidity and market risks. Management monitors and manages the nancial risks relating to the operations of the Group through regular reviews of the Groups exposure to these risks.
Oversight of the risk management system

All members of the Board are responsible for the oversight of risk management and internal controls to manage the Companys material business risks. The design, implementation and day to day responsibilities of the risk management strategy and internal control
26
The Group uses derivatives to limit its exposures to market risks. Hedging programs must be undertaken in compliance with the Groups Approved Hedging Policy. In summary, the Approved Hedging Policy governs and approves; hedging counterparties, hedging instruments that may be used, mandatory hedging limits, discretionary hedging limits, time periods of hedging programs, and; minimum hedging prices. Valuations of hedging programs are performed and reported to the Board monthly. Further details of the Companys policies relating to nancial risk management can be found at note 4 of the nancial statements.
Statement on nancial reports

The Managing Director and the Chief Financial Ofcer have declared in writing to the Board that the Groups nancial reports are founded on a sound system of risk management and internal control, and that the system is operating effectively in all material respects in relation to nancial risks. The Groups corporate governance policies require this statement is be made annually.
Statement on management of risks

The Managing Director has declared in writing to the Board that a risk management framework and internal control system has been designed and implemented to manage the Groups material business risks, any material failures of the risk management framework or internal control system have been noted and if the risk management framework and internal control system has operated effectively, in all material respects, in mitigating the Groups material business risks. The Groups corporate governance policies require this statement is be made annually.
Health, safety and environmental

The Companys projects are subject to regulations regarding health, safety and environmental matters. The governments and other authorities that administer and enforce these laws determine requirements. The Group intends to conduct its activities in a responsible manner and in accordance with applicable laws to this end the Group has established health, safety and environmental policies and divisions to implement and monitor compliance activities. Health, safety and environmental monitoring and compliance is reported to the Board monthly. The Board is not aware of any signicant breaches during the period covered by this report.
Assessment of effectiveness of risk management

Due to the size and scope of the Companys activities the Board has not established an internal audit department. The Audit Committee is responsible for assessing the effectiveness of the Groups compliance and control systems.
4.6 EThICAL STAndARdS

All directors, managers and employees are expected to act with the utmost integrity and objectivity, striving at all times to enhance the reputation and performance of the Group. To this end, the board has established a code of conduct. The Board reviews the Code of Conduct regularly and processes are in place to promote and communicate its requirements. Every employee has a supervisor to whom they may refer any issues arising from their employment.
Quality and integrity of personnel

Formal appraisals of all employees are conducted atleast annually. Training and development and appropriate remuneration and incentives are designed to attract high quality employees while retaining and advancing existing employees. The Group has also established a Code of Conduct which all directors and employees must comply with. The code is widely available and can be viewed on the Groups website (www.beadellresources.com.au)
Code of conduct
The Group has advised each director, manager and employee that they must comply with the Groups Corporate Code of Conduct. The code may be viewed on the Companys website, and covers the following: commitment of the Board and management to the corporate code of conduct; responsibilities to shareholders and the nancial community generally to increase shareholder value within an appropriate framework which safeguards the rights and interests of the Companys shareholders and the nancial community;
Insurances
The Group maintains a suite of insurances which are reviewed annually or as appropriate. External experts are engaged annually to review the Groups current and anticipated insurance requirements.
27
DIRECTORS REPORT
For the year ended to 31 December 2011 (continued) 4.6 EThICAL STAndARdS (CONTINUED)
compliance with systems of control and accountability which the Company has in place as part of its corporate governance with openness and integrity; responsibilities to clients, customers and consumers to comply with all legislative and common law requirements which affect the Companys business, in particular those in respect of occupational health and safety, the environment, native title and cultural heritage; employment practices so that the best available staff and consultants with appropriate skills are recruited to ll vacant positions and to ensure a safe work place and maintain proper occupational health and safety practices commensurate with the nature of the Companys business and activities; responsibilities to the community to recognise, consider and respect environmental issues which arise in relation to the Companys activities and comply with all applicable legal requirements; responsibilities to the individual to recognise and respect the rights of individuals and to the best of the Companys ability will comply with the applicable legal rules regarding privacy, privileges, private and condential information; obligations relative to fair trading to deal with others in a way that is fair and will not engage in deceptive practices; conicts of interest; compliance with the code so that any breach of compliance is reported as appropriate; periodic review of the code, and; code of conduct for executives, covering; a) active promotion of the highest standards of ethics and integrity, b) disclosure of any actual or perceived conicts of interest of a direct or indirect nature, c) respecting the condentiality of information, d) dealing with the Companys customers, suppliers, competitors and each other, e) protection of the assets of the Company, f) reporting any breach of the code of conduct to the Chairman. Before trading, or giving instructions for trading in the Companys securities, a director must: notify the Chairman in writing of his intention to trade; conrm that he does not hold any unpublished price sensitive information; have been advised by the Chairman that there is no reason to preclude him from trading in the Companys securities as notied; and; comply with any conditions on trading imposed by the Chairman. Where the Chairman intends to trade in the Companys securities, he must notify and obtain clearance in the abovementioned manner from the Managing Director before trading, or giving instructions for trading.
Conict of interest
The Board, management and employees must not involve themselves in situations where there is a real or apparent conict of interest between them as individuals and the interest of the Group. Where a real or apparent conict of interest arises the matter should be brought to the attention of the Chairman in the case of a board member, the Managing Director in the case of a member of management and a supervisor in the case of an employee, so that it may be considered and dealt with in an appropriate manner for all concerned. Details of director related entity transactions with the Company and the Group are set out in note 29 of the nancial statements.
Trading in Company securities by directors and employees

The Groups Securities Trading Policy is located on the Companys website. The key elements of the policy are that directors and employees; must not deal in any security of the Company whilst in possession of inside information; and; are discouraged from engaging in short term trading of any securities of the Company. Key Management Personnel may not deal in any security of the Company within: one week prior to the release of the Companys quarterly reports; one week prior to the release of the Companys half year nancial results; and one week prior to the release of the Companys full year nancial results.
28
In the case of any other key management personnel, they must notify and obtain clearance from the Managing Director before trading, or giving instructions for trading. Notications prior to trading must be evidenced by prior written communication, whether by letter, facsimile, e-mail, or other visible form of communication. In the case of Directors only, section 205G of the Corporations Act requires that a Director must notify the Australian Securities Exchange Limited of the acquisition or disposal of any security of the Company. A copy of any such notication should be forwarded by the relevant Director to the Company Secretary within 5 business days of a deal occurring.
requirements of applicable Accounting Standards and the Corporations Act and is lodged with the Australian Stock Exchange. The half yearly report is available on the Companys website and sent to any shareholder who requests it; the quarterly report contains summarised cash ow nancial information and details about the Companys activities during the quarter. The quarterly report is available on the Companys website and is sent to any shareholder who requests it; proposed major changes in the Group which may impact on share ownership rights are submitted to a vote of shareholders; the Companys website is well promoted to shareholders and shareholders may register to receive updates.
4.7 COmmunICATIOn wITh ShAREhOLdERS

The Company has designed a communications policy for promoting effective communication with shareholders and encouraging shareholder participation at annual general meetings. The policy is available on the Companys website and is set out below.
Company website
All of the above information is made available on the Companys website within one day of public release, and is e-mailed to all shareholders who lodge their e-mail contact details with the Company. Information on lodging e-mail addresses with the Company is available on the Companys website.
General Communication
The Board of Directors aims to ensure that the shareholders are informed of all major developments affecting the Groups state of affairs. Information is communicated to shareholders as follows: the annual report is distributed to all shareholders who request a copy. The Board ensures that the annual report includes relevant information about the operations of the Group during the year, changes in the state of affairs of the Group and details of future developments, in addition to the other disclosures required by the Corporations Act; the half yearly report contains summarised nancial information and a review of the operations of the Group during the period. The half year audited nancial report is prepared in accordance with the
Participation at the annual general meeting

The Board encourages full participation of shareholders at the Annual General Meeting to ensure a high level of accountability and identication with the Groups strategy and goals. Important issues are presented to the shareholders as single resolutions. The shareholders are requested to vote on the appointment of directors, the granting of options and shares to directors and changes to the constitution. Copies of the constitution are available to any shareholder who requests it.
29
DIRECTORS REPORT
For the year ended to 31 December 2011 (continued) 4.8 DIVERSITY
The Board has not yet adopted a Diversity Policy. No consideration is given to gender, age or ethnicity when selecting new employees or advancing existing employees. All prospective employees are employed and current employees are advanced based on individual achievements, skills and expertise.
Gender representation
31 December 2011 Representation Board Key management personnel Senior management Group Female 8% 8% Male 100% 100% 92% 92% 31 December 2010 Female 17% 8% Male 100% 100% 83% 92%
Key management personnel excludes directors which are reported as part of Board representation.
4.9 DISCLOSuRE Continuous Disclosure

The Board provides shareholders with information using a comprehensive Continuous Disclosure Policy which includes identifying matters that may have a material effect on the price of the Companys securities, notifying them to the ASX, posting them on the Companys website, and issuing media releases. More details of the policy are available on the Companys website. In summary, the Continuous Disclosure Policy operates as follows: the Company Secretary is responsible for all communications with the ASX; any information that a reasonable person would expect to have a material effect on the price or value of the Companys securities must be immediately advised to the ASX; the Company acknowledges that it is not required to disclose information to ASX if any of the following applies: a) a reasonable person would not expect the information to be disclosed; b) the information is condential, and; c) one of the following applies: i) it would be a breach of a law to disclose the information;
ASX Listing Rule disclosures

The Company has policies to ensure compliance with ASX Listing Rule disclosure. The Managing Director has been appointed as the ofcer responsible for compliance with these policies.
4.10 ExTERnAL AudIT

The Board is responsible for the initial appointment of the external auditor and the appointment of a new external auditor when any vacancy arises. Any appointment made by the Board must be ratied by shareholders at the next annual general meeting of the Company. Candidates for the position of external auditor of the Company must be able to demonstrate complete independence from the Company and an ability to maintain independence through the engagement period. Further, the successful candidate must have arrangements in place for the rotation of the audit engagement partner on a regular basis in accordance with any legal and/or professional standards. The Companys policy for the selection, appointment and rotation of the Companys external auditor can be found on the Companys website.
5.
PRInCIpAL ACTIVITIES
The principal activities of the Group during the period were: mining and construction activities at the Groups Tucano project (Tucano) located in Northern Brazil, and; exploration for and evaluation of mineral resources in Australia and Brazil. Other than the commencement of mining and construction activities at Tucano, there were no signicant changes in the nature of the activities of the Group during the period ended 31 December 2011.
ii) the information concerns an incomplete proposal or negotiation; iii) the information comprises matters of supposition or is insufciently denite to warrant disclosure; iv) the information is generated for the internal management purposes of the Company; or v) the information is a trade secret.
6. OpERATIng RESuLTS And REVIEw OF OpERATIOnS Operating results

The loss after income tax for the twelve months ended 31 December 2011 was $34,840,000 (six months ended 31 December 2010: $14,614,000).
Reserve category Proved Probable Total
Tonnes (millions) 7.4 19.0 26.4
Gold grade (g/t) 0.78 1.70 1.44
Gold ounces (millions) 0.184 1.039 1.224
Review of operations
Tucano Background Tucano is 100% owned by the Group and is located in Amap State, Brazil. The project was acquired in April 2010 and a denitive feasibility study into recommencing operations was completed during the period. Other signicant milestones achieved included the releases of a maiden gold and iron ore resources and gold reserve, commencement of construction and resumption of mining at Tucano. Denitive Feasibility Study (DFS) ndings The DFS was commenced in June 2010 and completed in May 2011. Key DFS ndings (May 2011) Physical (including stockpiles) Total ore mined and milled tonnes Grade g/t gold Stripping ratio waste/ore Recovery % Recovered gold ounces 26,397,416 1.47 4.9:1 90.6 1,126,135
The reserve does not include any provision for the signicant amount of iron mineralisation within and adjacent to the open pits. This would have a materially positive impact on reserves as all of the extensive iron mineralisation is treated as waste in the current gold pit optimisations. The joint mining of gold and iron ore at Tucano is discussed below at Tucano iron ore. Gold Resource The Tucano gold JORC compliant resource for Tucano was estimated in November 2010 and totalled 4.3Moz of gold at a 0.5g/t lower cut off grade and comprises: Gold grade (g/t) 0.78 1.51 1.56 1.47 Gold ounces (millions) 0.184 1.953 2.150 4.286
Reserve category Measured Indicated Inferred Total Approvals
Tonnes (millions) 7.4 40.2 42.9 90.5
The DFS made no reference or allowance for the extensive iron ore resources which are prevalent within the current pit shells. The inclusion of this ore into the pit optimisations would result in a materially positive improvement in project economics. The joint mining of gold and iron ore at Tucano is discussed below at Tucano iron ore. Reserves and resources Maiden Gold Reserve In April 2011 the Group announced a maiden JORC compliant reserve at Tucano totalling 1.25Moz of gold. The reserve comprises an open pit reserve of 19.0Mt @ 1.7g/t gold for 1.04Moz. Signicant stock piles located adjacent to the plant site have been re-estimated after the completion of close spaced RC drilling. A new reserve for the stock pile totals 7.4Mt @ 0.87g/t gold for 0.21Moz. The reserve at 0.65g/t lower cut off grade comprises:
During the period Tucano received nal regulatory approvals. The federal mining regulator approved the recommencement of mining at Tucano and the state government environmental operating licence was also approved. There are no further regulatory impediments to recommencing gold production at Tucano. Construction In 2011 the Group commenced construction of the 3.5Mtpa CIL plant at Tucano and is nearing completion, with the current construction schedule indicating rst ore to the mill in third quarter of 2012. Mining Mining commenced at Tucano in June 2011. Since commencement, mining activities have been focussed on developing the open pits of Tap AB, Tap C and Tap D. Project nance In October 2011 the Group signed an Agreement with Macquarie Bank Limited for a limited recourse US$80 million Project Finance Facility to complete construction and commence operations at Tucano. The Agreement allows for the provision of an additional US$10 million, should the Group require further funding for cost overrun purposes. Since satisfying conditions precedent, the Group has drawn down US$75 million of the facility.
31
DIRECTORS REPORT
For the year ended to 31 December 2011 (continued) 6. OpERATIng RESuLTS And REVIEw OF OpERATIOnS (CONTINUED)
As required by the facility, a total of 135,000 ounces of gold have been at forward sold (hedged) at US$1,600 per ounce and US$160 million of Brazilian Real (BRL) hedged at a at forward value of USD1.00 to BRL1.9525 over the 3 year term of the facility. The Group has also executed a US$20 million Mining Equipment Lease Facility for the purchase of additional earthmoving equipment to supplement the existing extensive eet. Iron ore Maiden Resource In August 2011 the Group announced a maiden JORC compliant iron ore resource at Tucano (Tap Norte). The Tap Norte iron ore resource totals 209.1Mt @ 36.1% Fe. The resource comprises a form of hematite rich banded iron formation (BIF) iron ore known as friable itabirite iron ore. Friable itabirites are beneciated to concentrate the iron ore to form high grade sinter and pellet feed iron t for smelting. A considerable amount of compact iron ore beneath the friable itabirite resource has not been included in the current resource estimate and remains a major potential additional source of iron ore. The resource at 25% lower cut off grade comprises: Resource category Measured Indicated Inferred Total Tonnes (million) 2.9 72.5 133.7 209.1 Fe % 40.4 37.2 35.4 36.1 SiO2 % 26.5 29.1 28.5 28.7 Al2O3 % 5.0 6.8 8.9 8.1 TiO2 % 0.3 0.4 0.2 0.2 P % 0.13 0.10 0.15 0.13 Mn % 2.2 1.5 2.1 1.9 K2O % 0.1 0.1 0.1 0.1 LOI % 4.8 5.5 7.5 6.8
Iron ore resource within existing gold reserve Within existing gold optimised pits there is a total resource of 35.9Mt @ 35.5% iron. This iron ore comprises the majority of the current waste within those pits. Realising economic value for the iron ore within the gold pits will reduce operating costs for the gold operation. Importantly, there has been no joint optimisation of iron ore and gold. This joint optimisation is expected to increase the size of the open pits and materially increase existing gold reserves, as widespread, high grade iron ore is located within and adjacent to current gold pit walls. Treatment of CIL gold tailings for iron ore The Group has evaluated the viability of an initiative to produce iron ore pellet feed from future CIL tailings by way of modications to the 3.5Mtpa CIL gold plant currently under construction. Metallurgical test work performed has determined that high grade iron ore pellet feed can be economically recovered from CIL tailings and a scoping study performed by ProMet Engineers has indicated that high grade (66-67%) iron ore concentrate of 250,000 500,000 tonne per annum can be achieved using a standard magnetic separation process. Capital Expenditure for the magnetic separation plant is estimated to be in the range of US$10-15 million. Extraction and sale of iron ore concentrate from CIL gold tailings will signicantly reduce gold production costs. The Group has appointed ProMet Engineers to produce engineering drawings for the magnetic separation plant with construction of this project estimated to be completed in late 2012. Logistics and off take opportunities are being investigated for the concentrate. Iron ore strategic partnership The group continues to explore opportunities to mine iron ore resources at Tucano either through a Joint Mining Agreement with Anglo American plc or through a strategic partnership with a third party.
32
Tropicana East Tropicana East is 100% owned by the Group and is located in Western Australia and was acquired in 2007. The project is located adjacent to the AngloGold Ashanti Independence Groups Tropicana 5Moz gold deposit. The Group has intersected high grade gold mineralisation at the Hercules and Atlantis prospects. The prospects are approximately 5km apart and located on the 15km long Hercules Shear Zone (HSZ). Potential for additional gold discoveries along the HSZ is considered to be high and the Group is planning further drilling to target potential extensions and high grade plunges of the mineralisation. Tartaruga Tartaruga is 100% owned by the Group and is located in Amap State, Brazil. The project was acquired in 2007 and a JORC compliant resource has been estimated for the project. The Tartaruga gold JORC compliant resource totals 0.3Moz of gold. The resource was estimated at a 0.5g/t lower cut off grade and comprises: Reserve category Inferred Total Tonnes (millions) 5.5 5.5 Gold grade(g/t) 1.60 1.60 Gold ounces (millions) 0.279 0.279
Preparations for recommencement of exploration at the Tartaruga project are underway. During the period the Group was awarded an adjoining tenement that to the northern tenement boundary of the main concession. The northern tenement is known to contain signicant gold mineralisation.
7. DIVIdEndS
No dividends were declared or paid during the period ended, or since 31 December 2011.
8. EVEnTS SubSEquEnT TO REpORTIng dATE

On 12 March 2012 the Company issued 58,097,806 shares to sophisticated and professional investors at $0.73 per share, raising gross proceeds of $42,411,398 (net proceeds of $40,065,828). As announced on the ASX on 5 March 2012, the Group is negotiating a US$20 million increase in its existing facility with Macquarie Bank Limited. The extension will require that an additional 50,000 ounces be hedged prior to draw down on the extended facility. There has not arisen in the interval between the end of the period and the date of this report any other item, transaction or event of a material and unusual nature likely, in the opinion of the directors of the Company, to affect signicantly the operations of the Group, the results of those operations, or the state of affairs of the Group, in future periods.
9. LIkELY dEVELOpmEnTS
The Group remains focussed on recommencing gold production at Tucano. The Groups 3.5Mtpa CIL plant is currently partially constructed, with completion and maiden gold pour expected by the third quarter of 2012. The Group also intends to construct and commission a magnetic separation plant at Tucano in order to extract an iron concentrate from the CIL gold tailings. The Group will continue to explore other opportunities associated with its iron ore resources at Tucano and will continue exploration activities on Australian and Brazilian exploration assets, with a particular emphasis on opportunities at Tucano, Tartaruga and Tropicana East.
33
DIRECTORS REPORT
For the year ended to 31 December 2011 (continued) 10. DIRECTORS InTERESTS
The relevant interest of each director in the shares, debentures, interests in registered schemes and rights or options over such instruments issued by the companies within the Group and other related bodies corporate, as notied by the directors to the Australian Securities Exchange in accordance with S205G(1) of the Corporations Act 2001, at the date of this report are; Options over ordinary shares issued in respect of shareholdings 1,000,000 1,000,000
Director Craig Readhead Jim Jewell Michael Donaldson Ross Kestel Peter Bowler Robert Watkins
Ordinary shares 12,000 410,000 1,733,333 12,543,333 6,150,001
Options over ordinary shares issued as remuneration 1,000,000 500,000 1,000,000 10,500,000 5,500,000
11.
ShARE OpTIOnS
Unissued shares under unlisted options related to remuneration

At the date of this report unissued ordinary shares of the Company under option that are related to remuneration are: Expiry date 31 December 2012 31 December 2013 31 December 2014 31 December 2014 1 January 2015 1 January 2015 Exercise price $0.3000 $0.1200 $0.1875 $0.6500 $0.8000 $0.8500 Number of shares 200,000 2,300,000 22,830,000 2,250,000 500,000 550,000
All options expire on the earlier of their expiry date or if not vested, on termination of the employees employment.
Unissued shares under unlisted options not related to remuneration

At the date of this report unissued ordinary shares of the Company under option issued to shareholders of the Company are: Expiry date 31 December 2012 31 December 2012 21 April 2014 Exercise price $0.3500 $0.5000 $0.1875 Number of shares 1,500,000 1,500,000 10,000,000
Shares issued on exercise of options

During the period to 31 December 2011, the Company issued the following ordinary shares as a result of the exercise of options (there are no amounts unpaid on shares issued). Number of shares 210,000 465,000 Amount paid per share $0.35 $0.25
Since the end of the period the Company has not issued ordinary shares as the result of the exercise of options.
34
12. IndEmnIFICATIOn And InSuRAnCE OF dIRECTORS And OFFICERS

The Group provides insurance to cover legal liability and expenses for the Directors and executive ofcers of the Company. The Directors and Ofcers Liability insurance provides cover against all costs and expenses that may be incurred in defending civil or criminal proceedings that fall within the scope of the indemnity and that may be brought against the ofcers in their capacity as ofcers. Disclosure of the nature of the liability cover and amount of the premium is subject to a condentiality clause under the insurance policy. The Group has not provided any insurance or indemnity for the auditor of the Company.
13.
NOn-AudIT SERVICES
During the period KPMG, the Companys auditor, has provided taxation advisory services in addition to their statutory duties in Australia and Brazil, in the amount of $23,350 and $5,982 respectively. The board has considered the non-audit services provided during the period by the auditor and is satised that the provision of those non-audit services during the period by the auditor is compatible with, and did not compromise, the auditor independence requirements of the Corporations Act 2001.
14. LEAd AudITORS IndEpEndEnCE dECLARATIOn

The Lead auditors independence declaration is set out on page 82 and forms part of the directors report for the period ended 31 December 2011.
15. ROundIng OFF

The Company is of a kind referred to in ASIC Class Order 98/100 dated 10 July 1998 and in accordance with that Class Order, amounts in the nancial report and directors report have been rounded off to the nearest thousand dollars, unless otherwise stated. This report is made with a resolution of the directors:
PETER BOWLER
Managing Director Dated at Perth, this 23rd day of March 2011.
35
CONSOlIdaTEd STaTEMENT Of fINaNCIal pOSITION

As at 31 December 2011
Consolidated Note Assets Cash and cash equivalents Prepayments Trade and other receivables Inventories Derivative nancial instruments Non-current assets held for sale Total current assets Trade and other receivables Exploration and evaluation assets Mineral properties under development Property, plant and equipment Derivative nancial instruments Other non-current assets Total non-current assets Total assets Liabilities Trade and other payables Employee benets Borrowings Provisions Total current liabilities Trade and other payables Derivative nancial instruments Borrowings Provisions Total non-current liabilities Total liabilities Net assets Equity Share capital Reserves Accumulated losses Total equity 2011 $000 2010 $000
17 16 10 19 11
40,133 846 542 5,781 442 47,744 166 2,230 77,658 8,860 973 443 90,330 138,074
41,904 115 1,294 5,728 1,570 50,611 18,792 8,817 250 27,859 78,470
16 14 13 12 19 15
23 21 18 26
8,661 1,361 13,814 24 23,860 58 10,254 41,442 9,765 61,519 85,379 52,695
3,009 625 3,634 57 11,159 11,216 14,850 63,620
23 19 18 26
25
124,500 (5,210) (66,595) 52,695
95,566 (191) (31,755) 63,620
The notes on pages 41 to 78 are an integral part of these consolidated nancial statements.
36
CONSOlIdaTEd STaTEMENT Of COMpREHENSIVE INCOME

For the year ended 31 December 2011
Consolidated 12 months ended 31 December 2011 $000 386 (17,787) (18,387) (35,788) 2,154 (1,363) 791 6 months ended 31 December 2010 $000 1,778 (2,086) (308) 1,770 (3,193) (14,014) (15,745) 1,603 (472) 1,131
Note Revenue Cost of sales Gross prot/(loss) Other income Administrative expenses Project exploration and evaluation expenses Results from operating activities Finance income Finance expense Net nance income 6
Loss for the period before income tax Income tax benet Loss for the period after income tax Other comprehensive loss Effective portion of changes in fair value of cash ow hedges Foreign currency translation differences for foreign operations Other comprehensive loss for the period net of tax Total comprehensive loss for the year Loss attributable to: Equity holders of the Company Loss for the period Other comprehensive loss attributable to: Equity holders of the Company Total comprehensive loss for the period Loss per share: Basic Loss per share ($) Diluted Loss per share ($) 9
(34,997) 157 (34,840)
(14,614) (14,614)
19 8
(8,839) (4,742) (13,581) (48,421)
(5,074) (5,074) (19,688)
(34,840) (34,840) (13,581) (13,581)
(14,614) (14,614) (5,074) (5,074)
20 20
(0.05) (0.05)
(0.02) (0.02)
37
38
Note 95,566 (2,216) (4,742) (4,742) (4,742) (8,839) (8,839) (8,839) (34,840) (34,840) 2,022 3 (31,755) 8 19 63,620 (34,840) (4,742) (8,839) (13,581) (48,821)
CONSOlIdaTEd STaTEMENT Of CHaNGES IN EQUITY
Share capital $000
Translation reserve $000
Share based Option payments premium reserve reserve $000 $000 Hedging reserve $000 Accumulated losses $000 Total equity $000
Balance at 1 January 2011 Total comprehensive loss for the period Loss for the period Other comprehensive loss Foreign currency translation differences Effective portion of changes in fair value of cash ow hedges Total other comprehensive loss Total comprehensive loss for the period Transactions with owners recorded directly in equity Contributions by and distributions to owners Issue of ordinary shares Equity transaction costs Share based payments Total contributions by and distributions to owners Balance as at 31 December 2011 22 30,189 (1,255) 28,934 124,500 3 (6,958) 8,562 8,562 10,584 (8,839) (66,595)
30,189 (1,255) 8,562 37,496 52,695
Note 95,592 2,858 (5,074) (5,074) (5,074) (14,614) (14,614) 1,314 3 (17,141) 8 82,626 (14,614) (5,074) (5,074) (19,688)
Share capital $000
Translation reserve $000
Share based payments reserve $000 Accumulated losses $000 Total equity $000
Option premium reserve $000
For the six months ended 31 December 2010
Balance at 1 January 2010 Total comprehensive loss for the period Loss for the period Other comprehensive loss Foreign currency translation differences Total other comprehensive loss Total comprehensive loss for the period Transactions with owners recorded directly in equity Contributions by and distributions to owners Equity transaction costs (26) 22 (26) 95,566 (2,216) 708 708 2,022 3 (31,755)
(26) 708 682 63,620
Share based payments Total contributions by and distributions to owners Balance as at 31 December 2010
CONSOlIdaTEd STaTEMENT Of CHaNGES IN EQUITY
39
CONSOlIdaTEd STaTEMENT Of CaSH flOWS

Consolidated 12 months ended 31 December 2011 $000 6 months ended 31 December 2010 $000
Note Cash ows from operating activities Cash receipts from customers Cash paid to suppliers and employees Income tax refund received Net cash provided by (used in) operating activities Cash ows from investing activities Interest received Proceeds from sale of property, plant and equipment Proceeds from the sale of intangible assets Payments for evaluation and exploration expenditure Payments for mine development Payments for acquisition of property, plant and equipment Cash paid as securities Net cash provided by (used in) investing activities Cash ows from nancing activities Proceeds from issue of share and options Transaction costs paid related to the issue of shares Proceeds from borrowings Net cash provided by (used in) nancing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the period Effect of exchange rate uctuations on cash held Cash and cash equivalents at the end of the period
17b
310 (6,091) 157 (5,624)
3,686 (4,838) 196 (956)
2,201 (18,260) (57,074) (3,534) (193) (76,860)
709 25 32,202 (12,149) (877) 19,910
28,934 53,963 82,897 413 41,904 (2,184) 40,133
(26) (26) 18,928 23,703 (727) 41,904
17a
40
NOTES TO THE CONSOlIdaTEd fINaNCIal STaTEMENTS
1. REpORTIng EnTITY
Beadell Resources Limited (the Company) is a company limited by shares and incorporated in Australia, whose shares are publicly traded on the Australian Stock Exchange. The address of the Companys registered ofce is Level 2, 16 Ord Street, West Perth, Western Australia. The consolidated nancial statements of the Company as at and for the period from 1 January 2011 to 31 December 2011 comprise the Company and its subsidiaries (together referred to as the Group and individually as Group entities). The nature of the operations and principal activities of the Group are described in the Directors Report.
assumptions and estimation uncertainties that have a signicant risk of resulting in a material adjustment within the next nancial year. Critical judgements Going concern A key assumption underlying the preparation of the nancial statements is that the Group will continue as a going concern. An entity is a going concern when it is considered to be able to pay its debts as and when they are due, and continue in operation without any intention or necessity to liquidate or otherwise wind up its operations. A signicant amount of judgement has been required in assessing whether the Group is a going concern. The Group held cash on hand and on deposit as at 31 December 2011 of $40.133 million. As at 31 December 2011 the Group has a net working capital surplus of $23.466 million. For the period ended 31 December 2011 the Group incurred a loss of $34.840 million. As at 31 December 2011 the Group held assets of $138.074 million. Cash ows from operations and investment activities was negative $82.484 million. The directors consider the going concern basis of preparation to be appropriate based on forecast cash ows and condence of raising additional funds if required. The cash ow forecast depends upon successful operation of mining and production activities in accordance with the ramp up schedule and gold price and foreign exchange assumptions to enable cash ow forecasts to be achieved. Should the ramp up of operations not successfully achieve forecasts or forecast gold and foreign exchange rates not be achieved, the Group may require additional funding in the form of debt or equity or a combination of the two. Estimates and assumptions Restoration obligations Signicant estimation is required in determining the provision for site restoration as there are many factors that may affect the timing and ultimate cost to rehabilitate sites where construction, mining and/ or exploration activities have taken place. These factors include future development and exploration activities, changes in the cost of goods and services required for restoration activities and changes to the legal and regulatory framework governing restoration obligations. These factors may result in future actual expenditure differing from amounts currently provided.
2. BASIS OF pREpARATIOn a) Statement of compliance

The nancial report is a general purpose nancial report which has been prepared in accordance with Australian Accounting Standards (AASBs) (including Australian Interpretations) adopted by the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. The consolidated nancial report of the Group complies with International Financial Reporting Standards (IFRSs) and interpretations adopted by the International Accounting Standards Board (IASB). The nancial statements were approved by the Board of Directors on 23 March 2012.
b) Basis of measurement
The consolidated nancial statements have been prepared on the historical cost basis except for derivative nancial instruments measured at fair value.
c) Functional and presentation currency

These consolidated nancial statements are presented in Australian dollars, which is the Companys functional currency. The Company is of a kind referred to in ASIC Class Order 98/100 dated 10 July 1998 and in accordance with that Class Order, all nancial information presented in Australian dollars has been rounded to the nearest thousand unless otherwise stated.
d) Use of estimates and judgements

Set out below is information below about: critical judgements in applying accounting policies that have the most signicant effect on the amounts recognised in the nancial statements; and
41

(Continued) 2. BASIS OF pREpARATIOn (CONTINUED) d) Use of estimates and judgements (continued)
Estimates and assumptions (continued) Ore Reserves Economically recoverable ore reserves represent the estimated quantity of product in an area of interest that can be expected to be protably extracted, processed and sold under current and foreseeable economic conditions. The Group determines and reports ore reserves under the standards incorporated in the Australasian Code for Reporting Exploration Results, Mineral Resources and Ore Reserves, 2004 edition (JORC Code). The Determination of ore reserves includes estimates and assumptions about a range of geological, technical and economic factors, including: quantities, grades, production techniques, recovery rates, production costs, transport costs, commodity demand, commodity prices, and exchange rates. Changes in ore reserves impact the assessment of recoverability of exploration and evaluation assets, provisions for site restoration, the carrying amount of assets depreciated on a units of production basis and the recognition of deferred taxes, including tax losses. Exploration and evaluation assets Determining the recoverability of exploration and evaluation expenditure capitalised in accordance with the Groups accounting policies requires estimates and assumptions as to future events and circumstances, in particular, whether successful development and commercial exploitation, or alternatively sale of the respective area of interest will be achieved. Critical to this assessment is estimates and assumptions as to Ore Reserves (refer above), the timing of expected cash ows, exchange rates, commodity prices and future capital requirements. Changes in these estimates and assumptions as new information about the presence or recoverability of an ore reserve becomes available, may impact the assessment of the recoverable amount of exploration and evaluation assets. If, after having capitalised the expenditure, a judgement is made that recovery of the expenditure is unlikely, an impairment loss is recorded in the income statement in accordance with the Groups accounting policies. In addition, an allocation of the cost associated with acquired mineral rights to individual projects is performed on acquisition. This allocation process requires estimates and judgement by management as to the value of those projects acquired Recognition of tax losses A deferred tax asset is recognised for unused tax losses only if it is probable that future taxable prots will be available to utilise those losses.
Determination of future taxable prots requires estimates and assumptions as to future events and circumstances, in particular, whether successful development and commercial exploitation, or alternatively sale, of the respective area of interest will be achieved. This includes estimates and judgements about commodity prices, ore reserves, exchange rates, future capital requirements, future operational performance and the timing of estimated cash ows. Changes in these estimates and assumptions could impact on the amount and probability of estimated taxable prots and accordingly the recoverability of deferred tax assets. Impairment of assets The recoverable amount of each non nancial asset or cash generating unit (CGU) is determined as the higher of the value in use and fair value less costs to sell. Determination of the recoverable amount of an asset or CGU based on a discounted cash ow model, requires the use of estimates and assumptions, including: the appropriate rate at which to discount cash ows, timing of cash ows, the expected life of the area of interest, commodity prices, exchange rates, ore reserves, future capital requirements and operational performance. Changes in these estimates and assumptions impact the recoverable amount of the asset or CGU and accordingly could result in an adjustment to the carrying amount of that asset or CGU. Hedge accounting Judgement is necessary when determining whether a derivative nancial instrument qualies for hedge accounting, such as whether forecast transactions are highly probable as required by AASB 139 Financial Instruments: Recognition and Measurement. The assessment of whether forecast transactions are highly probable is judgmental and is subject to changes to the timing and magnitude of underlying transactions. Fair value estimates for derivative nancial instruments The fair value of nancial instruments that are not traded in an active market is determined by using valuation techniques. Judgement is used to select a method and make assumptions that are mainly based on market conditions existing during and at the end of each reporting period.
e) Change of nancial year

During 2010 the nancial year of the Company was changed from 31 December to 31 December to align the Companys nancial year end with that of its Brazilian subsidiaries. Accordingly, comparative gures for the nancial statements cover the six month period from 1 July 2010 to 31 December 2010. The results for the period are therefore not directly comparable with the results for the year ended 31 December 2011.
3. SIgnIFICAnT ACCOunTIng pOLICIES

The accounting policies set out below have been applied consistently to all periods presented in these consolidated nancial statements, and have been applied consistently by Group entities. The Group has not elected to early adopt any accounting standards or amendments.
Where provisional accounting has been used, the Group completes nal valuations within a year of acquisition. Consideration transferred includes the fair values of the assets transferred, liabilities incurred by the Group to the previous owners of the acquiree, and entity interests issued by the Group. Consideration transferred also includes the fair value of any contingent consideration and share-based payment awards of the acquiree that are replaced mandatorily in the business combination. Contingent liabilities contingent liability of the acquiree is assumed A in a business combination only if such a liability represents a present obligation and arises from a past event, and its fair value can be measured reliably. Non-controlling interest The Group measures any non-controlling interest at its proportionate interest in the identiable net assets of the acquiree. Transaction costs T ransaction costs that the Group incurs in connection with a business combination, such as nders fees, legal fees, due diligence fees, and other professional and consulting fees, are expensed as incurred.
a) Basis of consolidation
i. Subsidiaries Subsidiaries are entities controlled by the Group. Control exists when the Group has the power to govern the nancial and operating policies of an entity so as to obtain benets from its activities. In assessing control, potential voting rights that currently are exercisable are taken into account. The nancial statements of subsidiaries are included in the consolidated nancial statements from the date that control commences until the date that control ceases. ii. Transactions and balances eliminated on consolidation Intra-group balances, and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated nancial statements. iii. Business combinations For every business combination, the Group identies the acquirer, which is the combining entity that obtains control of the other combining entities or businesses. Control is the power to govern the nancial and operating policies of an entity so as to obtain benets from its activities. In assessing control, the Group takes into consideration potential voting rights that currently are exercisable. The acquisition date is the date on which control is transferred to the acquirer. Judgement is applied in determining the acquisition date and determining whether control is transferred from one party to another. Measuring goodwill or discount in a business combination The Group measures goodwill as the fair value of the consideration transferred including the recognised amount of any non-controlling interest in the acquiree, less the net recognised amount (generally fair value) of the identiable assets acquired and liabilities assumed, all measured as of the acquisition date. Where the net amount of identiable assets exceeds fair value of consideration transferred, a discount on acquisition has arisen and the resultant gain is recognised in the Groups prot or loss. Provisional accounting for fair values is used where the Group has not completed nal valuations.
b) Foreign currency
Foreign currency transactions ransactions in foreign currencies are translated to T the functional currency of the operation at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at balance sheet date are translated to the presentation currency at the balance date at the exchange rate at that date. The foreign currency gain or loss on monetary items is the difference between amortised cost in the functional currency at the beginning of the period, adjusted for the effective interest and payments during the period, and the amortised cost in foreign currency translated at the exchange rate at the end of the period. on-monetary assets and liabilities denominated N in foreign currencies that are measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was determined. Non monetary items in a foreign currency that are measured in terms of historical cost are measured using the exchange rate at the date of the transaction.
43

(Continued) 3. SIgnIFICAnT ACCOunTIng pOLICIES (CONTINUED) b) Foreign currency (continued)
Foreign currency transactions (continued) Foreign currency differences arising on retranslation are recognised in prot or loss, except for qualifying cash ow hedges which are recognised in the other comprehensive income to the extent the hedge is effective. Foreign operations The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated to Australian dollars at exchange rates at reporting date. The income and expenses of foreign operations are translated to Australian dollars at average exchange rates prevailing during the period. Foreign currency differences are recognised in the foreign currency translation reserve. When a foreign operation is disposed of, in part or in full, the relevant amount in the foreign currency translation reserve is transferred to the income statement. Cash ow hedges Changes in the fair value of the derivative hedging instrument designated as a cash ow hedge are recognised in other comprehensive income to the extent the hedge is effective. To the extent the hedge is ineffective, changes in fair value are recognised in prot or loss. If the hedging instrument no longer meets the criteria for hedge accounting, expires, or is sold, terminated or exercised, or the designation is revoked, then hedge accounting is discontinued prospectively. The cumulative gain or loss previously recognised in other comprehensive income and presented in hedging reserve in equity remains there until the forecast transaction affects prot or loss. When the hedged item is a non nancial asset, the amount recognised in other comprehensive income is transferred to the carrying amount of the asset when the asset is recognised. If the forecast transaction is no longer expected to occur, then the balance in other comprehensive income is recognised immediately in prot or loss. Other non-trading derivatives When a derivative nancial instrument is not designated in a hedge relationship that qualies for hedge accounting, all changes in its fair value are recognised immediately in prot or loss. ii. Non-derivative nancial instruments N on-derivative nancial instruments comprise trade and other receivables, cash and cash equivalents, borrowings and trade and other payables. N on-derivative nancial instruments are recognised initially at fair value plus, for instruments not at fair value through prot or loss, any directly attributable transaction costs. Subsequent to initial recognition non-derivative nancial instruments are measured at amortised cost, less any impairment charges. nancial instrument is recognised if the Group A becomes a party to the contractual provisions of the instrument. Financial assets are derecognised if the Groups contractual rights to the cash ows from the nancial assets expire or if the Group transfers the nancial asset to another party without retaining control or substantially all risks and rewards of the asset. Regular way purchases and sales of nancial assets are accounted for at trade date, i.e., the date that the Group commits itself to purchase or sell the asset. Financial liabilities are derecognised if the Groups obligations specied in the contract expire or are discharged or cancelled.
c) Financial instruments
i. Derivative nancial instruments, including hedge accounting
The Group holds derivative nancial instruments to manage its foreign currency and gold price risk exposures. On initial designation of the hedge, the Group formally documents the relationship between the hedging instrument and hedged item, including risk management objectives and strategy in undertaking the hedge transaction, together with the methods that will be used to assess the effectiveness of the hedge relationship. The Group makes an assessment, both at the inception of the hedge relationship as well as on an ongoing basis, whether the hedging instruments are expected to be highly effective in offsetting the changes in the fair value or cash ows of the respective hedged items during the period for which the hedge is designated and whether the actual results of each hedge are within a range of 80 to 125%. For a cash ow hedge of a forecast transaction, the transaction should be highly probable to occur and should present an exposure to variations in cash ows that could ultimately affect reported prot or loss. Derivatives are recognised initially at fair value. Attributable transaction costs are recognised in prot or loss as incurred. Subsequent to initial recognition, derivatives are measured at fair value and changes therein are accounted for as described below.
44
Cash and cash equivalents Cash and cash equivalents comprise cash at bank, cash on hand and short term deposits at call. Short term deposits have original maturities of 3 months or less that are readily convertible to known amounts of cash and are subject to insignicant risk of changes in fair value. Trade and other receivables Receivables are initially recorded at fair value and subsequently measured at amortised cost using, less any allowance for impairment. Trade and other receivables are usually settled in 30 to 60 days and due to their short term nature are generally not discounted. Trade and other payables Trade and other payables are carried at amortised cost. The amounts are unsecured and typically settled in 30 to 60 days of recognition. Due to their short term nature, balances are generally not discounted. Borrowings Borrowings are initially recognised at fair value, net of transaction costs incurred. Subsequent to initial measurement, borrowings are recorded at amortised cost using the effective interest rate method. Fees paid on the establishment of loan facilities, which are not an incremental cost relating to the actual drawdown of the facility, are recognised as prepayments and amortised on a straight line basis over the term of the facility. Borrowings are classied as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. iii. Share capital Ordinary shares Ordinary Shares are classied as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Dividends Dividends are recognised as a liability in the period in which they are declared.
ii. Gold on carbon sales Revenue is recognised when the risks and rewards of ownership have been transferred to the buyer and recovery of the consideration is probable, associated costs can be measured reliably, there is no continuing management involvement with the goods and the amount of revenue can be measured reliably. iii. Royalty income The Group recognises revenue from royalties based on a percentage of iron ore sales from certain tenements where the Group has assigned its iron ore rights. Revenue is recognised when the amount of iron ore sales can be measured reliably after the actual sale.
e) Exploration and evaluation expenditure

Exploration and evaluation costs, excluding acquisition costs, are expensed as incurred. Acquisition costs are accumulated in respect of each separate area of interest. Exploration and evaluation assets are only recognised if the rights to the area are current and either: i. the acquisition costs are expected to be recouped through successful development and exploitation of the area of interest, or;
ii. activities in the area of interest have not at the reporting date, reached a state which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves and active and signicant operations in, or in relation to, the area of interest are continuing. Exploration and evaluation assets are assessed for impairment if: i. sufcient data exists to determine technical feasibility and commercial viability, and;
ii. facts and circumstances suggest the carrying amount exceeds the recoverable amount. For the purposes of impairment testing, exploration and evaluation assets are allocated to cash generating units (CGUs) to which the exploration activity relates. The CGU shall not be larger than the area of interest. Once technical feasibility and commercial viability of the extraction of mineral resources in an area of interest are demonstrable, exploration and evaluation assets attributable to that area of interest are rst tested for impairment and then reclassied to mine property assets within property, plant and equipment.
d) Revenue
i. Rental income Rental income is recognised in prot or loss on a straight-line basis over the term of the lease.
45

(Continued) 3. SIgnIFICAnT ACCOunTIng pOLICIES (CONTINUED) e) Exploration and evaluation expenditure (continued)
In the event that an area of interest is abandoned or if the directors consider the exploration and evaluation assets attributable to the area of interest to be of reduced value, the exploration and evaluation assets are impaired in the period in which the assessment is made. Each area of interest is reviewed at each reporting period and accumulated costs are written off to the extent that they will not be recoverable in the future. Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment and are recognised net within other income in prot or loss. When re-valued assets are sold, the amounts included in the revaluation reserve are transferred to retained earnings. Subsequent costs The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benets embodied within the part will ow to the Group and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in prot or loss as incurred. Depreciation Depreciation is recognised in prot or loss on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment. The estimated useful lives for the current and comparative periods are as follows: plant and equipment 2 - 20 years xtures and ttings 5 - 10 years
f) Mineral properties under development

Development expenditure relates to costs incurred to access a mineral resource. It represents those costs incurred after the technical feasibility and commercial viability of the extraction of mineral resources in a particular area of interest is demonstrated and the identied mineral reserve is being prepared for production. Development expenditure includes: reclassied exploration and evaluation assets, direct costs of construction, pre-production stripping costs, and an appropriate allocation of overheads and borrowing costs during the development phase. Capitalisation of development expenditure ceases once the mineral property is capable of commercial production, at which point it will be transferred to Mine Properties. Amortisation and depreciation of capitalised mine development costs is provided on the unit-ofproduction method, resulting in an amortisation charge proportional to the depletion of the economically recoverable mineral resources. Capitalised costs are amortised from the commencement of commercial production.
Depreciation methods, useful lives and residual values are reviewed at each reporting date.
h) Leased assets
Leases in terms of which the Group assumes substantially all the risks and rewards of ownership are classied as nance leases. Upon initial recognition the leased asset is measured at an amount equal to the lower of its fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset. Other leases are operating leases and the leased assets are not recognised on the Groups statement of nancial position.
g) Property, plant and equipment

Recognition and measurement Items of property, plant and equipment are measured at cost less accumulated depreciation and impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset. When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.
i) Leases
Lease payments Payments made under operating leases are recognised in prot or loss on a straight-line basis over the term of the lease. Lease incentives received are recognised as an integral part of the total lease expense, over the term of the lease.
46
Determining whether an arrangement contains a lease At inception of an arrangement, the Group determines whether the arrangement is or contains a lease. This will be the case if the following criteria are met: the fullment of the arrangement is dependent on the use of a specic asset(s); and the arrangement contains the right to use the assets(s). At inception or upon reassessment of the arrangement, the Group separates payments and other consideration required by such an arrangement into those for the lease and those for other elements on the basis of their relative fair values. If the Group concludes for a nance lease that it is impracticable to separate the payments reliably, an asset and a liability are recognised at an amount equal to the fair value of the underlying asset. Subsequently the liability is reduced as payments are made and an imputed nance charge on the liability is recognised using the Groups incremental borrowing rate.
an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash ows are discounted to their present value using a pre-tax discount rate that reects current market assessments of the time value of money and the risks specic to the asset. For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inows from continuing use that are largely independent of the cash inows of other assets or groups of assets, known as CGUs. An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its recoverable amount. Impairment losses are recognised in prot or loss. Impairment losses recognised in respect of CGUs are allocated to reduce the carrying amount of assets in the unit (group of units) on a pro rata basis. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the assets carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.
j) Impairment
Financial assets A nancial asset is assessed at each reporting date to determine whether there is any objective evidence that it is impaired. A nancial asset is considered to be impaired if objective evidence indicates that one or more events have had a negative effect on the estimated future cash ows of that asset. An impairment loss in respect of a nancial asset measured at amortised cost is calculated as the difference between its carrying amount, and the present value of the estimated future cash ows discounted at the original effective interest rate. All impairment losses are recognised in prot or loss and any subsequent reversals of impairment losses are also recognised in prot or loss. An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment loss was recognised. Individually signicant nancial assets are tested for impairment on an individual basis. The remaining nancial assets are assessed collectively in groups that share similar credit risk characteristics. Non-nancial assets The carrying amounts of the Groups non-nancial assets (excluding deferred tax assets and inventories) are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists then the assets recoverable amount is estimated. The recoverable amount of
k) Employee benets
Dened contribution plans A dened contribution plan is a post-employment benet plan under which an entity pays xed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to dened contribution plans are recognised as a personnel expense in prot or loss when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available. Short-term benets Liabilities for employee benets for wages, salaries and annual leave represent present obligations resulting from employees services provided to reporting date and are calculated at undiscounted amounts based on remuneration wage and salary rates that the Group expects to pay as at reporting date including related, where material, on-costs, such as workers compensation insurance and payroll tax. Non-accumulating benets, such as sick leave, are expensed as the benets are taken by the employees.
47

(Continued) 3. SIgnIFICAnT ACCOunTIng pOLICIES (CONTINUED) k) Employee benets (continued)
Long-term benets The Groups net obligation in respect of longterm employee benets is the amount of future benet that employees have earned in return for their service in the current and, where applicable, prior periods plus related on costs; that benet is discounted to determine its present value and the fair value of any related assets is deducted. The discount rate is the yield at the reporting date on national government bonds that have maturity dates approximating the terms of the Groups obligations. Share-based payment transactions The Group provides benets to employees of the Group and service providers in the form of sharebased payment transactions, whereby services are rendered in exchange for share options. The fair value of options is measured using the BlackScholes formula. Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted average historic volatility adjusted for changes expected due to publicly available information), weighted average expected life of the instruments (based on historical experience and general option holder behaviour), expected dividends, and the riskfree interest rate (based on government bonds). Service and non-market performance conditions attached to the transactions are not taken into account in determining fair value. The cost of share based payment transactions is recognised, together with a corresponding increase in equity, over the period in which the performance conditions are fullled, ending on the date on which the relevant employees become fully entitled to the award (vesting date). The cumulative expense recognised for share based payment transactions at each reporting date until vesting date reects (i) the extent to which the vesting period has expired and (ii) the number of awards that, in the opinion of the directors of the Company, will ultimately vest. This opinion is formed based on the best available information at balance date. No adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the determination of fair value at grant date. No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition. Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if they were a modication of the original award.
l) Income tax
I ncome tax expense comprises current and deferred tax. Income tax expense is recognised in prot or loss except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity. urrent tax is the expected tax payable on the C taxable income for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. D eferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for nancial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable prot, and differences relating to investments in subsidiaries to the extent that it is probable that they will not reverse in the foreseeable future. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. eferred tax assets and liabilities are offset if D there is a legally enforceable right to offset current tax liabilities and assets and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously. deferred tax asset is recognised to the extent A that it is probable that future taxable prots will be available against which the temporary difference can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benet will be realised.
48
m) Finance income and expense

Finance income comprises interest income. Interest income is recognised as it accrues in prot or loss, using the effective interest method. Finance expense comprises impairment losses recognised on nancial assets, unwinding of the discount on restoration provisions and borrowing costs recognised using the effective interest method that are not directly attributable to the acquisition, construction or production of a qualifying asset. Foreign currency gains and losses are reported on a net basis. Borrowing costs Borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset are capitalised as part of the cost of the asset, all other borrowing costs are expensed as incurred. Borrowing costs consist of interest and other costs that the Group incurs in connection with the borrowing of funds.
o) Goods and services tax and equivalent indirect taxes

Revenue, expenses and assets are recognised net of the amount of goods and services tax and equivalent indirect taxes, except where the amount of tax incurred is not recoverable from the taxation authority. In these circumstances, the tax is recognised as part of the cost of acquisition of the asset or as part of the expense. Receivables and payables are stated with the amount of tax included. The net amount of tax recoverable from, or payable to, the taxation authority is included as a current asset or liability in the balance sheet. Cash ows are included in the statement of cash ows on a gross basis. The tax components of cash ows arising from investing and nancing activities which are recoverable from, or payable to, the taxation authority are classied as operating cash ows.
p) Earnings per share

he Group presents basic and diluted earnings T per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the prot or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the prot or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares.
n) Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outow of economic benets will be required to settle the obligation. Provisions are determined by discounting the expected future cash ows at a pre-tax rate that reects current market assessments of the time value of money and the risks specic to the liability. Site restoration Mine closure and restoration costs include the costs of dismantling and demolition of infrastructure or decommissioning, the removal of residual material and the remediation of disturbed areas specic to the site. Provisions are recognised at the time that the environmental disturbance occurs. The provision is the best estimate of the present value of the future cash ows required to settle the restoration obligation at the reporting date, based on current legal requirements and technology. Future restoration costs are reviewed annually and any changes are reected in the present value of the restoration provision at the end of the nancial year. The amount of the provision for future restoration costs is capitalised as an asset and recognised in property, plant and equipment and is depreciated over the useful life of the mineral resource. The unwinding of the effect of discounting on the provision is recognised as a nance cost. Restoration expenditure is capitalised to the extent that it is probable that the future economic benets associated with restoration expenditure will ow to the Group.
q) Operating segments
The Group determines and presents operating segments based on the information that is provided to the Board, who is the Groups chief operating decision maker. An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Groups other components. An operating segments operating results are reviewed regularly by the Board to make decisions about the allocation of resources to the segment and to assess its performance, and for which discrete nancial information is available. Segment results that are reported to the Board include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise predominantly of administrative expenses. Segment capital expenditure is the total cost incurred during the period to acquire property, plant and equipment, and intangible assets other than goodwill.
49

(Continued) 3. SIgnIFICAnT ACCOunTIng pOLICIES (CONTINUED) r) Government grants
Government grants that compensate the Group for expenses incurred are recognised in prot or loss on a systematic basis in the same periods in which the expenses are recognised.
v) New standards and interpretations not yet adopted

The following standards, amendments to standards and interpretations have been identied as those which may impact the entity in the period of initial application. They are available for early adoption at 31 December. AASB 9 Financial Instruments (December 2010) & AASB2010-7 Amendments to Australian Accounting Standards arising from AASB9 (2010; includes requirements for the classication and measurement of nancial assets that are generally consistent with the equivalent requirements in AASB 139 Financial Instruments: Recognition and Measurement except in respect of the fair value option and certain derivatives linked to unquoted equity instruments. AASB 9 will become mandatory for the Groups 31 December 2013 nancial statements. Retrospective application is generally required, although there are exceptions, particularly if the entity adopts the standard for the year ended 31 December 2012 or earlier. The Group has not yet determined the potential effect of the standard. AASB 10 Consolidated Financial Statements introduces a new approach to determining which investees should be consolidated. The amendments to AASB 10 will be mandatory for the Groups 31 December 2013 year end, with retrospective application. The Group has not yet determined the potential impact of these amendments. AASB11 Joint Arrangements will apply if the parties have rights to and obligations for underlying assets and liabilities, the joint arrangement is considered a joint operation and partial consolidation is applied. Otherwise the joint arrangement is considered a joint venture and the entity must use the equity method to account for their interest. AASB11 will become mandatory for the Groups 31 December 2013 nancial statements. Retrospective application with specic restatement requirements for certain transition. The Group has not yet determined the potential effect of the standard.
s) Inventories
Inventories are measured at the lower of cost and net realisable value. The cost of inventories is based on the weighted average cost principle and includes expenditure incurred in acquiring inventories, production or conversion costs and other costs incurred in bringing them to their existing location and condition. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses.
t) Intangible assets
Intangible assets that are acquired by the Group and have nite useful lives are measured at cost less accumulated amortisation and accumulated impairment losses. Intangibles are amortised over life of mine. Amortisation is calculated over the cost of the asset less residual value. Amortisation is recognised on a straight line basis in prot or loss over estimated useful lives. Amortisation methods, useful lives and residual values are reviewed at each reporting period and adjusted if appropriate.
u) Non-current assets held for sale

Non-current assets that are expected to be recovered primarily through sale rather than through continuing use are classied as held for sale. Immediately before classication as held for sale the assets are re-measured in accordance with the Groups accounting policies. Thereafter the assets are generally valued at the lower of their carrying amount and fair value less costs to sell. Impairment losses recognised on initial classication to as held for sale and subsequent gains or losses on re-measurement are recognised in prot or loss. Gains are not recognised in excess of any cumulative impairment loss.
50
AASB 13 Fair value Measurement explains how to measure fair value when required by other AASBs. It does not introduce new fair value measurements, nor does it eliminate the practicability exceptions to fair value that currently exist in certain standards. AASB 13 will become mandatory for the Groups 31 December 2013 nancial statements. AASB 12 Disclosures of Interests in Other Entities contains the disclosure requirements for entities that have interest in subsidiaries, joint arrangements, associates and/or unconsolidated structured entities. AASB 12 will be mandatory for the Groups 31 December 2013 year end. The Group has not yet determined the potential impact of these amendments. AASB 119 Employee Benets (September 2011) and AASB 2011-10 Amendments to Australian Accounting Standards arising from AASB 119 (September 2011) amended AASB 119 focussing on but not limited to the accounting for dened benet plans. In addition it changes the denition of short-term and other long-term employee benets and some disclosure requirements. The amendments to AASB 119 will be mandatory for the Groups 31 December 2013 year end. The Group has not yet determined the potential impact of these amendments. AASB 2011-9 Amendments to Australian Accounting Standards Presentation of Items of Other Comprehensive Income introduces the separate classication of those items that would be reclassied to prot and loss in the future and those that would never be reclassied to prot or loss and the impact on those items. The amendments to AASB 2011-9 will be mandatory for the Groups December 2013 year end. The Group has not yet determined the potential impact of this amendment.
4. FInAnCIAL RISk mAnAgEmEnT Overview

This note presents information about the Groups exposure to credit, liquidity and market risks, objectives, policies and processes for measuring and managing risk and the management of capital. The Group has established a Risk Management Policy and Risk Management Strategy. The Groups Risk Management Policy and Strategy address the Groups exposure to and management of credit, market and liquidity risks. The Board of Directors has overall responsibility for the establishment and oversight of the Risk Management Strategy. The design, implementation and day to day responsibilities of the risk management strategy and internal control system rest with management. The Audit Committee is responsible for reviewing the Groups risk management systems and internal nancial control systems.
Credit risk
Credit risk is the risk of nancial loss to the Group if a customer or counterparty to a nancial instrument fails to meet its contractual obligations, and arises principally from the Groups receivables, cash and cash equivalents.
Cash, cash equivalents and security given

Cash and cash equivalents Cash and cash equivalents comprise of cash on hand and demand deposits. The Group limits its credit risk by holding cash balances and demand deposits with reputable counterparties with acceptable credit ratings. Security given Security given comprises cash balances used as security for bank guarantees issued by the Groups bankers (refer note 15). Cash balances given as security are held in demand deposits with reputable counterparties with acceptable credit ratings.
51

(Continued) 4. FINANCIAL RISK MANAGEMENT (CONTINUED) Trade and other receivables
The Groups other receivables at balance date comprise rental receivables from the Groups sub-lessees, interest receivable and goods and services and equivalent indirect taxes. The Group has established an allowance for impairment that represents incurred losses in respect of receivables. All other receivables are expected to be received within six months. Derivative assets The Groups derivative assets at balance date comprise gold and foreign exchange forward contracts (hedges). The Groups Approved Hedging Policy governs and approves hedging counterparties, instruments, limits and minimum prices. Counterparties to derivative instruments must have acceptable credit ratings and are as stated in the Groups Approved Hedging Policy. Further details on the Groups derivatives can be found at note 19.
Exposure to credit risk

The carrying amounts of the Groups nancial assets represent maximum exposure to credit risk, by region and in total as set out below; Consolidated 31 December 31 December 2011 2010 $000 $000 3,747 300 471 4,518 36,386 143 237 1,415 38,181 17 15 16 19 40,133 443 708 1,415 42,699 12,166 250 319 12,735 29,738 975 30,713 41,904 250 1,294 43,448
Note Australia Cash and cash equivalents Security given for bank guarantees Other receivables, goods and services tax and equivalent taxes Exposure to credit risk Brazil Cash and cash equivalents Security given for bank guarantees Other receivables, goods and services tax and equivalent taxes Derivative assets Exposure to credit risk Total Cash and cash equivalents Security given for bank guarantees Other receivables, goods and services tax and equivalent taxes Derivative assets Exposure to credit risk
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its nancial obligations as they fall due. The Groups approach to managing liquidity is to ensure, as far as possible, that it will always have sufcient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Groups reputation. As the Group is primarily engaged in the development of its Tucano Project, the Group will continue to have a negative cash ow until the Tucano Project itself becomes cash ow positive. If the Group exhausts its cash reserves and available undrawn borrowings prior to the Tucano Project becoming cash ow positive, the Group may require additional nancing to fund working capital, construction, debt service and other commitments. The Group prepares detailed models as part of its system of budget planning which are used to predict liquidity needs and support funding activities. The progress of construction activities and commencement of production activities are monitored regularly to determine cash out ows to date and monitor cash requirements.
52
Liquidity risk is managed by monitoring actual and budgeted cash out ows for the Group. The following are the contractual maturities of nancial liabilities, including estimated interest payments: Carrying amount $000 31 December 2011 Trade and other payables Borrowings Derivative nancial liabilities Balance as at 31 December 31 December 2010 Trade and other payables Balance as at 31 December 3,066 3,066 3,066 3,066 3,009 3,009 57 57 8,719 55,256 10,254 74,229 Contractual cash ows $000 8,719 62,775 10,270 81,764 6 months or less $000 8,661 1,327 9,988
6-12 months $000 58 15,914 (3) 15,969
1-2 years $000 45,534 2,573 48,107
2-5 years $000 7,700 7,700
The following table indicates periods in which the cash ows associated with derivatives that are cash ow hedges are expected to occur and impact prot or loss: Carrying amount $000 31 December 2011 Gold forward contracts Foreign exchange forward contracts Balance as at 31 December 31 December 2010 Trade and other payables Balance as at 31 December (3,066) (3,066) (3,066) (3,066) (3,009) (3,009) 57 57 1,391 (10,230) (8,839) Contractual cash ows $000 1,391 (10,230) (8,839) 6 months or less $000 -
6-12 months $000 417 24 441
1-2 years $000 792 (1,335) (543)
2-5 years $000 182 (8,819) (8,737)
It is not expected that the cash ows included in the maturity analysis could occur signicantly earlier, or at signicantly different amounts.
Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Groups income or the value of its holdings of nancial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return. The Group is exposed to uctuations in foreign currency rates, interest rates and metals prices (principally gold upon commencement of gold production at Tucano). In each case, future operational cash ows and ability to service current and future borrowings are affected by these uctuations. The Groups strategy is to mitigate foreign exchange and metal price risks by use of derivatives to partially hedge these exposures. Derivatives are not used mitigate interest rate risks. Derivatives contracts entered into are further discussed at note 19.
Currency risk
Currency risk arises from investments and borrowings that are denominated in a currency other than the respective functional currencies of Group entities.
53

(Continued) 4. FINANCIAL RISK MANAGEMENT (CONTINUED) Exposure
The Group is exposed to foreign currency risk in the form of nancial instruments held in BRL and USD, as illustrated below, based on notional amounts; 31 December 2011 Cash and cash equivalents Securities given Other receivables Trade and other payables Borrowings Statement of nancial position exposure Foreign exchange forward contracts Net exposure 31 December 2010 Cash and cash equivalents Other receivables Trade and other payables Exposure US$000 18,247 (414) (60,000) (42,167) 160,000 117,833 US$000 R$000 34,941 271 449 (11,432) 24,229 24,229 R$000 29,738 975 (2,187) 28,526
Sensitivity analysis
Assuming all other variables remain constant, a 10% strengthening of the Australian dollar at 31 December 2011 against the BRL would have resulted in a decreased loss of $2,641,000. A 10% weakening of the AUD would have had the equal but opposite effect, assuming all other variables remain constant. This analysis is based on exchange rate variances the Group considered to be reasonably possible at the end of the period. The following signicant exchange rates applied during the year: Average rate Reporting date spot rate 12 months 6 months ended ended 31 December 31 December 31 December 31 December 2011 2010 2011 2010 AUD BRL 1 USD 1 0.581 0.969 0.613 1.061 0.528 0.983 0.589 0.984
Interest rate risk

Interest rate risk is the risk that a nancial instruments value will uctuate as a result of changes in the market interest rates on interest-bearing nancial instruments. The Group is exposed to interest rate risk on cash and cash equivalents and its borrowings. The Group does not use derivatives to mitigate these exposures. Cash and cash equivalents are held at variable and xed interest rates. Cash in term deposits are held for xed terms at xed interest rates maturing in periods less than three months. The Groups other cash balances are held in deposit accounts at variable rates with no xed term. Interest rates on the Groups borrowings are xed for terms of 3 to 6 months from drawing or rolling of principal amounts.
Prole
At the reporting date the interest rate prole of the Groups interest-bearing nancial instruments was:
54
Consolidated 31 December 31 December 2011 2010 $000 $000 Fixed rate instruments Financial assets Financial liabilities Net xed rate instruments Variable rate instruments Financial assets Financial liabilities Net variable rate instruments 300 (55,256) (59,076) 40,276 40,276 12,352 12,352 29,802 29,802
Fair value sensitivity analysis for xed rate instruments

The Group does not account for any xed rate nancial assets and liabilities at fair value through prot or loss. Therefore a change in interest rates at the reporting date would not affect prot or loss.
Cash ow sensitivity analysis interest rates

A change in interest rates of 100 basis points at the reporting date would have decreased (increased) the Groups loss by the amounts shown below. This analysis assumes that all other variables remain constant. 100bp increase 12 months ended 31 December 2011 $000 358 358 100bp decrease 12 months ended 31 December 2011 $000 (358) (358) 100bp increase 6 months ended 31 December 2010 $000 107 107 100bp decrease 6 months ended 31 December 2010 $000 (107) (107)
Sensitivity Interest bearing instruments Cash ow sensitivity (net)
Fair values versus carrying amounts

Carrying amounts of nancial assets and liabilities equate to their corresponding fair values.
Other market price risk

The Groups nancial assets and liabilities are not exposed any other market price risk.
Commodity price risk

Although the Group operates in the development phase and is not currently exposed to uctuations in the gold price, the Group has entered into gold forward contracts to mitigate commodity price risk exposures on a portion of anticipated future gold sales in the period June 2012 to December 2014. The Group has hedged approximately 32% of forecast gold production during the hedging period.
Fair value hierarchy

The Groups derivative nancial instruments are carried at fair value and have been valued using a combination of valuation methods. The different valuation levels are assessed as: Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities, Level 2: inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices), Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). The Group has used a combination level 1 and level 2 inputs in determining the fair value of its derivative nancial instruments.
55

(Continued) 4. FINANCIAL RISK MANAGEMENT (CONTINUED) Capital management
The Groups objectives when managing capital are to safeguard the Groups ability to continue as a going concern, so as to maintain a capital base (comprising equity plus borrowings) sufcient to allow future exploration and development of the Groups current projects and evaluation of potential acquisitions. The Group has raised capital through the issue of equity and borrowings to fund its development, exploration and evaluation and administration activities. The Group manages capital by monitoring its adjusted capital ratio, with the target being 1:1 or lower. The Groups adjusted capital ratio at the end of the period was as follows: Consolidated 31 December 31 December 2011 2010 $000 $000 85,379 14,850 (40,133) (41,904) 45,246 (27,054) 52,695 63,620 8,839 61,534 63,620 0.74 n/a
Total liabilities Less: cash and cash equivalents Net debt Total equity Add: net amounts accumulated in equity related to cash ow hedges Adjusted capital Debt to adjusted capital ratio
In determining the funding mix of debt and equity, consideration is given to the ability of the Group to service loan interest and repayment schedules, lending facility compliance ratios and amount of free cash ow desired. The Group may raise additional capital through the issue of new shares or borrowings for exploration, development and/or asset acquisition, should the Group require additional capital to carry out those activities.
5. OpERATIng SEgmEnTS
The Group has two reportable segments; Australian exploration and evaluation and Brazilian exploration, evaluation and development, which are the Groups strategic business units. The strategic business units are managed separately because they are governed by different regulatory regimes. For each of the strategic business units, the Board reviews internal management reports on a monthly basis. Brazil $000 (348) (1,535) (839) (15,276) 3,322 (1,060) (8,950) Australia $000 (63) (3,342) (37) (4,040) Total $000 (348) (1,535) (902) (18,618) 3,322 (1,097) (12,990)
Information about reportable segment loss 12 months ended 31 December 2011 Project nance interest expenses Impairment of segment assets Depreciation Reportable segment loss before income tax 6 months ended 31 December 2010 External revenues and royalties Depreciation Reportable segment loss before income tax
56
Reconciliation of reportable segment loss Total loss for reportable segments Unallocated amounts - Corporate income - Corporate expenses Consolidated loss before tax Brazil $000 97,421 34,123
6 months 12 months ended ended 31 December 31 December 2010 2011 $000 $000 (18,618) (12,990) 2,539 (18,918) (34,997) Australia $000 1,744 1,761 1,828 (3,452) (14,614) Total $000 99,165 35,884
Information about reportable segment assets 31 December 2011 Reportable segment assets 31 December 2010 Reportable segment assets
Reconciliation of reportable segment assets Total assets for reportable segments Unallocated amounts - Corporate assets Consolidated assets
31 December 31 December 2011 2010 $000 $000 99,165 35,884 38,909 138,074 42,586 78,470
Geographical segments
In presenting information on the basis of geographical segments, segment revenue is based on the geographical location of customers. Segment assets are based on the geographical location of assets Non-current Revenues Non-current Revenues assets as at 6 months assets as at 12 months 31 December ended 31 31 December ended 31 2010 December 2010 2011 December 2011 $000 $000 $000 $000 1,744 1,761 87,004 1,778 26,098 1,582 90,330 1,778 27,859
Australia Brazil Unallocated amounts Balance at the end of the period
57

(Continued) 6. REVEnuE And OThER InCOmE
Consolidated 6 months 12 months ended ended 31 December 31 December 2010 2011 $000 $000 Revenue Gold on carbon sales Other income Royalty income Rental income Other income Other income 372 14 386 1,778 1,544 226 1,770
7. PERSOnnEL ExpEnSES
Consolidated 6 months 12 months ended ended 31 December 31 December 2010 2011 $000 $000 4,817 1,752 1,384 477 851 272 1,513 1,027 8,562 708 17,127 4,236
Note Wages, salaries and benets Contributions to dened contribution plans Increase in liability for annual leave Other personnel expenses Share-based payment transactions Personnel expenses
22
8. FInAnCE InCOmE And ExpEnSE

Consolidated 6 months 12 months ended ended 31 December 31 December 2010 2011 $000 $000 Recognised in prot of loss Interest income Interest expense Net foreign exchange (loss)/gain Unwind of discount on site restoration costs Net nance income Recognised directly in equity Foreign currency translation differences for foreign operations Finance income recognised directly in equity, net of tax Attributable to: Equity holders of the Company Finance income recognised directly in equity, net of tax 2,154 (348) (663) (352) 791 (4,742) (4,742) (4,742) (4,742) 651 952 (472) 1,131 (5,074) (5,074) (5,074) (5,074)
58
9. InCOmE TAx
No tax is payable by the Group. Deferred tax assets are brought to account only to the extent required to offset deferred tax liabilities and where it is probable of recovery. All other tax losses are not brought to account as it is not probable that future taxable income will be available against which the Group can utilise these benets.
Income Statement
Consolidated 31 December 31 December 2011 2010 $000 $000 157 157 (34,840) (11,149) (5,585) 10,942 (5,663) 11,455 (14,614) 812 (1,600) 6,155 (2,287) 308 (1,562) (1,826) -
Current income tax charge R&D tax refund received Tax income reported in the statement of comprehensive income Numerical reconciliation between tax loss and pre-tax accounting loss Pre tax accounting loss for the period Income tax benet at the Groups tax rates of Australia: 30%, Brazil: 34% Income not assessable for tax purposes Expenditure not allowable for tax purposes Temporary differences not recognised Current year losses for which no deferred tax asset was recognised Recognition of prior year losses Recognition of unrecorded federal tax credits Current income tax charge
Deferred income tax

Consolidated 31 December 31 December 2011 2010 $000 $000 Tax assets/(liabilities) Exploration and evaluation assets Property, plant and equipment and mineral properties under development Trade and other receivables Trade and other payables Inventories Employee benets Net derivative liability Provisions Deductible equity raising costs Deferred tax assets not brought to account Net deferred tax assets (694) 33,543 1,232 1,720 2,101 85 3,005 3,193 1,110 (44,295) 1,360 33,847 4,882 124 2,928 47 3,794 979 (47,961) -
59

(Continued) 9. INCOME TAX (CONTINUED) Unrecognised deferred tax balances
Deferred tax balances have not been recognised in respect of the following items; Consolidated 31 December 31 December 2011 2010 $000 $000 Deferred tax assets Deductible temporary differences Tax effect carry forward losses Australia Tax effect carry forward losses Brazil Balance at the end of the period Deferred tax liabilities Assessable temporary differences Balance at the end of the period 45,989 6,111 20,578 72,678 (694) (694) 47,961 4,095 11,373 63,429 -
10. InVEnTORIES
Consolidated 31 December 31 December 2011 2010 $000 $000 5,781 5,728 5,781 5,728
Spare parts, raw materials and consumables Balance at the end of the period
11. NOn-CuRREnT ASSETS hELd FOR SALE

Consolidated 31 December 31 December 2011 2010 $000 $000 1,570 1,570 (164) (1,406) 1,570
Opening balance Transfers from property, plant and equipment Effect of movement in exchange rates Provision for impairment Balance at the end of the period
Part of the existing site infrastructure at the Groups Tucano project was presented as non-current assets held for sale following the commitment of the Groups management to a plan to sell several signicant items. During the period the Group was not successful in disposing of these items and has determined the carrying value of the items is no longer recoverable.
60
12. PROpERTY, pLAnT And EquIpmEnT

Consolidated Plant & equipment $000 10,357 (833) 3,520 (960) 12,084 1,565 901 1,015 (219) 3,262 8,792 8,822 Fixtures & ttings $000 30 14 44 5 1 6 25 38 Consolidated Plant & equipment $000 12,246 40 833 (86) (1,570) (1,106) 10,357 604 1,096 (61) (74) 1,565 11,642 8,792 Fixtures & ttings $000 26 4 30 4 1 5 22 25 Total $000 12,272 44 833 (86) (1,570) (1,106) 10,387 608 1,097 (61) (74) 1,570 11,664 8,817 Total $000 10,387 (833) 3,534 (960) 12,128 1,570 902 1,015 (219) 3,268 8,817 8,860
31 December 2011 Cost Opening balance Transfers to mineral properties under development Additions Disposals Effect of movements in exchange rates Balance at 31 December 2011 Depreciation Opening balance Depreciation expensed Depreciation capitalised to mineral properties under development Disposals Effect of movements in exchange rates Balance at 31 December 2011 Carrying amount Opening balance Balance at 31 December 2011
31 December 2010 Cost Opening balance Additions Capital works in progress Disposals Transfers to non-current assets held for sale Effect of movements in exchange rates Balance at 31 December 2010 Depreciation Opening balance Depreciation for the period Disposals Effect of movements in exchange rates Balance at 31 December 2010 Carrying amount Opening balance Balance at 31 December 2010
61

(Continued) 13. MInERAL pROpERTIES undER dEVELOpmEnT
Consolidated 31 December 31 December 2011 2010 $000 $000 Cost Opening balance Transfers from property, plant and equipment Transfers from exploration and evaluation assets Construction works in progress Pre production expenditure Rehabilitation provision recognised Effect of movements in exchange rates Balance at the end of the period 833 16,491 46,324 15,512 306 (1,808) 77,658 -
14. ExpLORATIOn And EVALuATIOn ASSETS

Consolidated 31 December 31 December 2011 2010 $000 $000 Cost Opening balance Transfers to mineral properties under development Effect of movements in exchange rates Balance at the end of the period 18,792 (16,491) (71) 2,230 20,555 (1,763) 18,792
Exploration and evaluation assets reect capitalised acquisition costs only. The recoverability of the carrying amounts of exploration and evaluation assets is dependent on the successful development and commercial exploitation or sale of the respective area of interest. Upon demonstrating the technical feasibility and commercial viability of the extraction of mineral resources the Groups Tucano project, the exploration and evaluation assets attributable to Tucano were reclassied as mineral properties under development.
15. OThER nOn-CuRREnT ASSETS

Consolidated 31 December 31 December 2011 2010 $000 $000 250 250 193 443 250
Opening balance Security for bank guarantees given Security for bank guarantees released Balance at the end of the period
The Group has established various facilities with the Groups bankers. The facility is secured by cash, held in cash balances with the Groups bankers in xed rate deposits for rolling terms of three to six months. The average interest rate applied during the period was 5%. Interest accruing on balances is payable to the Group. The facilities have been established to issue bank guarantees to satisfy the Groups environmental and ofce lease bond requirements.
62
16. TRAdE And OThER RECEIVAbLES

Consolidated 31 December 31 December 2011 2010 $000 $000 263 1,193 445 101 708 1,294 542 1,294 166 708 1,294
Other receivables Goods and services and equivalent indirect taxes Balance at the end of the period Current Non current Balance at the end of the period
17. (A) CASh And CASh EquIVALEnTS

Bank balances Cash and cash equivalents in the statement of cash ows
17. (B) RECOnCILIATIOn OF CASh FLOwS FROm OpERATIng ACTIVITIES

Consolidated 31 December 31 December 2011 2010 $000 $000 (34,840) 8 12 (791) 902 8,562 1,652 (902) 15,677 (9,740) (53) 565 3,617 (170) (5,781) 157 (5,624) (14,614) (1,131) 1,097 708 4 (2,343) 13,129 (3,150) 2,473 (73) (372) (30) (1,152) 196 (956)
Note Cash ows from operating activities Loss for the period Adjustments for: Net nance income Depreciation Equity-settled share-based payment transactions Loss (prot) on sale of property, plant and equipment Impairment losses recognised Change in provisions Exploration and evaluation expenditure classied as investing activities Operating prot/(loss) before changes in working capital Change in inventories Change in trade and other receivables Change in trade and other payables Change in prepayments Cash (used in)/provided by operating activities Income tax refund received Net cash (used in)/provided by operating activities
63

(Continued) 18. BORROwIngS
Consolidated 31 December 31 December 2011 2010 $000 $000 55,256 55,256 13,814 41,442 55,256 -
Secured loans Balance at end of the period Current Non current Balance at end of the period
Facility Agreement
In October 2011 the Group entered into a US$90 million Facility Agreement with Macquarie Bank Limited. The Facility was established to fund the development of the Tucano Gold Project and expires on 31 December 2014. Interest rates are xed for terms of 3 to 6 months from drawing or rolling of principal amounts. The Facility is secured by a rst priority charge over all assets of the Group until commercial production and various other performance parameters are achieved (Project Completion). At Project Completion, the Facility will be secured by a rst priority charge over Groups wholly owned subsidiary, Beadell Brasil Ltda (incorporating the Tucano Gold Project) and the Groups ownership interests in Beadell Brasil Ltda and the Tucano Gold Project. As at 31 December 2011, the Group had drawn US$60 million from the facility. The weighted average interest rate that applied during the period was 4.46% per annum. The Group is currently negotiating a US$20 million extension to its existing Facility Agreement. This matter is further described at note 31 subsequent events.
Master Lease Agreement

In December 2011 the Group entered into a US$20 million Master Lease Facility with Macquarie Bank Limited to nance up to 90% of the acquisition costs of certain equipment for use at the Tucano Gold Project. The Group had not purchased any equipment under this lease as at 31 December 2011 and hence no amount is payable at balance date related to the lease.
19. DERIVATIVE FInAnCIAL InSTRumEnTS

Consolidated 31 December 31 December 2011 2010 $000 $000 Derivative assets Gold forward contracts Foreign exchange forward contracts Balance at end of the period Current Non current Balance at end of the period Derivative Liabilities Foreign exchange forward contracts Balance at end of the period Current Non current Balance at end of the period 1,391 24 1,415 442 973 1,415 10,254 10,254 10,254 10,254 -
64
Forward contracts designated as cash ow hedges

The Groups derivative nancial instruments have been designated as cash ow hedges. As at 31 December 2011 the Group had a net hedge liability of $8,839,000 reecting the net positive mark to market value of gold forward contracts and the net negative mark to market value of foreign exchange contracts. Gold forward contracts relate to the sale of 135,000 gold ounces at a value of US$1,600 per ounce, maturing from June 2012 to December 2014. Foreign exchange forward contracts relate to the sale of 160 million United States Dollars (USD) and receipt of Brazilian Reais (BRL) at an exchange rate of 1 USD = 1.9525 BRL, maturing from June 2012 to December 2014.
20. LOSS pER ShARE Basic loss per share

The basic loss per share for the period is $0.05 (for the 6 months ended 31 December 2010: $0.02). The calculation of basic loss per share at 31 December 2011 was based on the consolidated loss attributable to ordinary shareholders of $34,840,000 (31 December 2010: $14,614,000) and a weighted average number of ordinary shares outstanding of 640,079,331 (31 December 2010: 621,937,828) calculated as follows:
Loss attributable to ordinary shareholders

Consolidated 6 months 12 months ended ended 31 December 31 December 2010 2011 $ $ 34,840,000 14,614,000 34,840,000 14,614,000
Loss for the period Loss attributable to ordinary shareholders
Weighted average number of ordinary shares

Consolidated 31 December 31 December 2011 2010 Shares Shares 621,937,828 621,937,828 18,141,503 640,079,331 621,937,828
Weighted average effects Opening balance Effect of shares issued Weighted average number of ordinary shares at the end of the period
Diluted loss per share

The Company does not have any potential ordinary shares whose conversion to ordinary shares would have a dilutive effect on basic loss per share and as such diluted loss per share is equal to basic loss per share. Potential ordinary shares of the Company consist of 38,630,000 share options issued as share based payments and 3,000,000 share options issued to shareholders of the Company (refer note 25). In accordance with AASB 133 Earnings per Share these options have been excluded from the calculation of diluted loss per share due to their anti-dilutive effect.
65

(Continued) 21. EmpLOYEE bEnEFITS
Consolidated 31 December 31 December 2011 2010 $000 $000 660 290 701 335 1,361 625
Current Salaries, wages and benets accrued Liability for annual leave Total employee benets
22. ShARE-bASEd pAYmEnTS Employee Share Option Plan

In 2007 the Group established a share option programme that entitles employees to purchase shares in the Company, all options issued under the plan are subject to the Companys rules for incentive options. The following table illustrates the number and movements in share based payment options during the period: Consolidated 31 December 31 December 2011 2010 $000 $000 28,255,000 3,175,000 1,800,000 25,080,000 (675,000) (750,000) 28,630,000 27,030,000 28,255,000 3,175,000
Current Opening balance Options granted during the period Options exercised during the period Options cancelled during the period Options outstanding at the end of the period Options exercisable at the end of the period
66
Number of options Grant date/period Key Management Personnel 500,000 27 August 2009 1,500,000 25 November 2009 Vesting Vested Vested Vested Vested 200,000 Vested, 200,000 vesting 12 July 2012 and 200,000 vesting 12 July 2013 Vested Vested Vested Vested 21 January 2012 1 August 2012 15 September 2011 5 October 2012 11 October 2012 9 November 2012 1 January 2015 31 December 2014 31 December 2014 31 December 2014 $0.65 $0.65 $0.65 $0.85 1 January 2015 $0.85 1 January 2015 $0.80 31 December 2014 $0.65 31 December 2014 $0.19 3.95 3.57 3.95 3.49 2.79 2.74 2.72 3.15 31 December 2013 $0.12 3.84 31 December 2012 $0.30 3.93 $0.07 $0.05 $0.10 $0.35 $0.48 $0.45 $0.43 $0.36 $0.29 $0.33 31 December 2014 31 December 2014 $0.19 $0.65 3.59 2.97 $0.44 $0.43 31 December 2014 $0.19 3.95 $0.10 31 December 2013 31 December 2013 $0.12 $0.12 3.84 3.60 $0.05 $0.07 Expiring
Strike price Contractual per option life (years)
Fair value per option
5,000,000
20 July 2010
17,000,000 600,000
29 November 2010 12 July 2011
Other employees
200,000
28 July 2008
300,000
27 August 2009
830,000
20 July 2010
1,500,000
6 December 2010
500,000
21 January 2011
500,000
6 July 2011
50,000
15 September 2011
50,000
5 October 2011
50,000
11 October 2011
50,000
9 November 2011
Vesting conditions for unvested options as at 31 December 2011 is represented below:
Number of options 200,000 200,000
Grant date/period 12 July 2011 12 July 2011
Vesting conditions of unvested options Key Management Person must be in the Groups employment as at 12 July 2012 Key Management Person must be in the Groups employment as at 12 July 2012 Employee must be in the Groups employment as at 21 January 2012 Employee must be in the Groups employment as at 1 August 2012 Employee must be in the Groups employment as at 15 September 2012 Employee must be in the Groups employment as at 5 October 2012 Employee must be in the Groups employment as at 11 October 2012 Employee must be in the Groups employment as at 9 November 2012
500,000
21 January 2011
The outstanding balance of employee share options are options as at 31 December 2011 is represented by:
500,000 50,000
6 July 2011 15 September 2011
50,000
5 October 2011
50,000
11 October 2011
50,000
9 November 2011
67
68
The grant date fair value of employee share options was measured using the Black-Scholes formula. The inputs to the model used to determine the fair value of options granted during the period were: Employees granted 2011 6 July $0.45 -% 3.49 $0.87 $0.85 66.59% 4.73% 3.58% 3.52% 3.45% 3.71% 65.39% 64.81% 66.16% 66.02% $0.76 $0.85 $0.85 $0.65 $0.65 $0.65 $0.75 $0.65 $0.81 $0.65 66.50% 4.42% 3.15 2.79 2.74 2.72 2.97 9 November $0.33 -% 15 September $0.44 -% 5 October $0.29 -% 11 October $0.36 -%
(Continued)
12 months ended 31 December 2011 Fair value at grant date Expected dividends
21 January $0.48 -%
Key Management personnel granted 12 July 2011 $0.43 -%
Contractual life (years)
3.95
Market value of underlying shares Option exercise price
$0.82 $0.80
Employee Share Option Plan (continued)
Expected volatility of the underlying shares Risk free rate applied
72.29%
5.29%
22. ShARE-bASEd pAYmEnTS (CONTINUED)
No other features of options granted were incorporated into the measurement of fair value. Employees granted 2010 20 July $0.10 -% 3.9 $0.19 $0.19 64.14% 4.77% 5.01% 66.59% $0.67 $0.65 $0.19 $0.19 64.14% 4.77% 3.6 3.9 6 December $0.38 -% 20 July $0.10 -% Key Management personnel granted 2010 29 November $0.45 -% 3.6 $0.57 $0.19 65.86% 5.12% 6 December $0.38 -% 3.6 $0.67 $0.65 66.59% 5.01%
12 months ended 31 December 2010 Fair value at grant date Expected dividends
Contractual life (years)
Market value of the underlying shares Exercise price of options granted
Expected volatility of the underlying shares
Risk free rate applied
No other features of options granted were incorporated into the measurement of fair value.
Employee share options forfeited during the period ended 31 December 2011
750,000 options were forfeited on 6 May 2011 due to failure to meet vesting conditions stated in the terms and conditions of the Employee Share Option Scheme.
Recognised as employee costs during the period ended 31 December 2011

Consolidated 31 December 31 December 2011 2010 $000 $000 947 239 8,679 708 (117) 9,509 947
Opening balance Share options granted equity settled Share options forfeited equity settled Share based payments recognised
Other share based payments

In April 2010 the Company issued 5,000,000 options each to Macquarie Bank Ltd and Macquarie Capital Group Ltd in relation to a prior capital raising approved by shareholders. The options were granted and vested on 21 April 2010, each option has a strike price of $0.1875, expires on 21 April 2014 and a fair value of $0.11. The grant date fair value of share options was measured using the Black-Scholes formula. The following table illustrates the number and movements in these share based payment options during the period: Consolidated 31 December 31 December 2011 2010 Options Options 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000
Opening balance Options granted during the period Options outstanding at the end of the period Options exercisable at the end of the period The following table illustrates the value of these share based payment options:
Opening balance Share options granted equity settled Closing share based payments recognised
23. TRAdE And OThER pAYAbLES

Consolidated 31 December 31 December 2011 2010 $000 $000 8,719 3,066 8,719 3,066 8,661 3,009 58 8,719 57 3,066
Trade and other payables Balance at the end of the period Current Non-current Balance at the end of the period
69

(Continued) 24. OpERATIng LEASES Leases as lessee
Non-cancellable operating lease rentals are payable as follows: Consolidated 31 December 31 December 2011 2010 $000 $000 853 746 336 988 1,189 1,734
Less than one year Between one and ve years Operating lease rentals payable
The Group leases property and equipment in Australia and Brazil under operating leases. Leases of equipment run for periods ranging from one to three years with lease payments being xed throughout the duration of each equipment lease. The Groups property leases run for periods ranging from one to three years.
Leases as lessor
Non-cancellable operating lease rentals are receivable as follows: Consolidated 31 December 31 December 2011 2010 $000 $000 340 340 85 426 425 766
Less than one year Between one and ve years Operating lease rentals receivable
The Company has entered into a sub-lease agreement to lease a portion of its head ofce space where the Company is head lessee. The sub-lease agreement expires within 2 years, coincident with the expiration of the head lease agreement.
25. CApITAL And RESERVES

Consolidated 31 December 31 December 2011 2010 $000 $000 621,937 621,937 35,969 657,906 621,937
Share capital On issue at the beginning of the period Issued for cash On issue at the end of the period
Share capital
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company. All shares are fully paid and rank equally with regard to the Companys residual assets.
Translation reserve
The translation reserve comprises all foreign currency differences arising from the translation of the nancial statements of foreign operations.
70
Option premium reserve

The option premium reserve comprises consideration paid for 3 million options issued to initial shareholders of the Company on 25 June 2007 at an average fair value of $0.001. The options have exercise prices of $0.35 and $0.50 and expire on 31 December 2012 and carry no voting rights.
Share based payments reserve

The share based payments reserve includes the cumulative expense recognised in respect of options granted to;
Employee share option plan

Employees of the Company as part of the Companys share option plan. All options expire on the earlier of; 31 December 2012 (200,000 options), 31 December 2013 (2,300,000 options), 31 December 2014 (25,080,000 options) and 1 January 2015 (1,050,000 options); The day employee ceases employment with the Company, unless the Board determines otherwise; 30 days after the employee ceases employment by reason of retirement. The share options carry no voting rights.
Other share based payments

10,000,000 options granted to Macquarie Bank Ltd and Macquarie Capital Group Ltd in April 2010, expiring 21 April 2014. The share options carry no voting rights.
Hedging reserve
The hedging reserve comprises the effective portion of the cumulative net change in the fair value of cash ow hedging instruments related to hedged transactions that have not yet occurred.
26. PROVISIOnS
Consolidated 31 December 31 December 2011 2010 $000 $000 11,159 13,260 319 455 893 (1,583) (999) 9,789 24 9,765 9,789 (1,321) (1,235) 11,159 11,159 11,159
Balance at beginning of the period Unwind of discount on site restoration costs Provisions made during the period Provisions reversed during the period Effect of movements in exchange rates Balance at the end of the period Current Non-current Balance at the end of the period
The Groups provisions comprise provisions for site restoration of $8,189,000 (2010: $8,723,000), legal proceedings of $1,575,000 (2010: $2,436,000) and community contributions of $24,000 (2010: nil).
Site restoration
The provision includes estimates of costs associated with reclamation, rehabilitation and other costs associated with the restoration of the present mine site. Estimates of restoration costs are based on current legal requirements and future costs that have been discounted to their present value.
71

(Continued) 26. PROVISIONS (CONTINUED) Legal proceedings
The provision includes estimates to discharge various claims, legal proceedings and complaints arising in the ordinary course of business. These matters are ongoing and are being vigorously defended by the Group. During the period the Group settled a legal claim of R$681,000 (A$359,000) that was previously provided for. The claim was settled for an amount of R$100,000 (A$53,000). Various other legal claims were settled during the period. The amount provided for related to these claims was R$401,000 (A$212,000), the claims were settled for R$188,000 (A$99,000). Other legal claims previously provided for (totalling R$336,000 (A$177,000)) were dismissed during the period.
27. CApITAL And OThER COmmITmEnTS

These obligations at balance date have not been provided for and are as set out in the table below. Consolidated 31 December 31 December 2011 2010 $000 $000 364 1,077 1,441 3,128 3,128 4,569 461 1,782 2,243 2,243
Not yet provided for Minimum exploration expenditure commitments Within one year Contractual commitments Within one year Capital and other commitments within one year Contractual commitments One year or later and no later than ve years Capital and other commitments one year or later and no later than ve years Capital commitments
Minimum exploration expenditure requirements

In order to maintain current rights of tenure to exploration tenements, the Group is required to meet minimum expenditure requirements specied by various State governments. These commitments are subject to renewal of exploration permits, renegotiation upon expiry of the exploration permit or when an application for a mining permit is made.
Contractual commitments Facility Agreement

The Group has entered into a Facility Agreement (refer note 18). The terms of the agreement commit the Group to make monthly payments in respect of the undrawn portion of the facility. Should no further amount be drawn in the 2012 year, the Groups minimum commitment in respect of the facility as at 31 December 2011 is US$600,000 (approximately A$590,000).
Community fund
The Group has an agreement with the Municipality of Pedra Branca and the Municipality of Serra do Navio in whose region the Groups Brazilian Tucano Gold Project resides. The agreement requires the Group make annual payments of R$550,000 (approximately A$290,000). R$357,500 is payable to the Municipality of Pedra Branca and R$192,500 is payable to the Municipality of Serra do Navio.
Mineral rights assignment

The Group has an agreement for the assignment of mineral rights and other covenants with Brazmin Ltda for the acquisition of mineral rights for the Groups Brazilian Tartaruga project. As part of the assignment agreement the Group has undertaken to make annual payments of US$100,000 (approximately A$98,000) to Keystone Ltda as were previously required to be made by Brazmin Ltda.
72
Land access agreement

The Group has negotiated a land access agreement for several of its exploration and mining concessions, annual commitments in respect of these agreements are approximately $99,000 per annum.
28. COnTIngEnCIES
Consolidated 31 December 31 December 2011 2010 $000 $000 528 589 528 589
Litigation and claims Total contingent liabilities not considered remote
The directors are of the opinion that provisions are not required in respect of these matters, as it is not probable that a future sacrice of economic benets will be required or the amount is not capable of reliable measurement.
Litigation and claims

The Group is currently vigorously defending an infraction relating to environmental damage to William Creek in Brazil. The alleged damage is related to the modication of the Creeks riverbed, soiling and sedimentation. The infraction was assumed by the Group on acquisition of the Tucano gold project.
29. RELATEd pARTIES Key management personnel compensation

The key management personnel compensation is as set out below. Consolidated 31 December 31 December 2011 2010 $ $0 1,860,576 647,460 100,404 41,175 7,371,319 914,378 9,332,299 1,603,013
Short-term employee benets Post-employment benets Share based payments Key management personnel compensation
Individual directors and executives compensation disclosures

Information regarding individual directors and executives compensation and some equity instruments disclosures as permitted by Corporations Regulations 2M.3.03 are provided in the Remuneration Report section of the Directors Report in section 4.3.
Key management personnel transactions

A number of key management persons, or their related parties, hold positions in other entities that result in them having control or signicant inuence over the nancial and/or operating policies of those entities. In the reporting period the Group transacted with a company of which Mr Jewell is the sole director. Mr Jewell was engaged on a contractor basis to act as the Groups lead project manager for the duration of the Tucano DFS. Subsequently, Mr Jewell has been engaged to provide various construction management and technical services. Amounts have been billed based on normal market rates for such services and are payable under normal payment terms. In the reporting period the Group transacted with Allion Legal Pty Ltd, a company of which Mr Readhead is a director. Allion Legal Pty Ltd were engaged during the period to provide legal advice on various commercial issues. Amounts have been billed based on normal market rates for such services and are payable under normal payment terms.
73

(Continued) 29. RELATED PARTIES (CONTINUED) Key management personnel transactions (continued)
The value of transactions and balances outstanding relating to key management personnel and entities over which they control or have signicant inuence are as follows: Transactions value 12 months ended 31 December 2011 $ 27,008 199,530 226,538 Transactions value 6 months ended 31 December 2010 $ 129,350 129,350
Key management person Mr Readhead Mr Jewell
Transaction with related party Legal services Project management & technical services Total and current liabilities
Balance outstanding 31 December 2011 $ 12,740 12,740
Balance outstanding 31 December 2010 $ 19,110 19,110
Options and rights over equity instruments

The movement during the reporting period in the number of options over ordinary shares in the Company held, directly, indirectly or benecially, by key management personnel, including their related parties, is as follows; For the twelve months ended 31 December 2011: Vested and exercisable at 31 December 2011 1,000,000 500,000 1,000,000 11,500,000 6,500,000 6,500,000 200,000 -
1 January 2011 Directors Mr Readhead Mr Jewell Dr Donaldson Mr Bowler Mr Watkins Executives Mr Barrett Mr Andrade Mr Torresini 1,000,000 500,000 1,000,000 11,500,000 6,500,000 6,500,000 750,000
Granted as compensation 600,000 -
Exercised -
Cancelled (750,000)
31 December 2011 1,000,000 500,000 1,000,000 11,500,000 6,500,000 6,500,000 600,000 -
Vested during the period 1,000,000 500,000 500,000 10,000,000 5,000,000 5,000,000 200,000 -
For the six months ended 31 December 2010: Vested and exercisable at 31 December 2010 500,000 1,500,000 1,500,000 1,500,000 -
1 January 2010 Directors Mr Readhead Mr Jewell Dr Donaldson Mr Bowler Mr Watkins Executives Mr Barrett Mr Torresini 500,000 1,500,000 1,500,000 1,500,000 -
Granted as compensation 1,000,000 500,000 500,000 10,000,000 5,000,000 5,000,000 750,000
Exercised -
31 December 2010 1,000,000 500,000 1,000,000 11,500,000 6,500,000 6,500,000 750,000
Vested during the period
Further details regarding options granted as compensation to key management personnel during the year can be found at note 22.
Movements in shares
The movement during the reporting period in the number of ordinary shares in Beadell Resources Limited held, directly, indirectly or benecially, by key management personnel, including their related parties, is as follows; For the twelve months ended 31 December 2011: 1 January 2011 Directors Mr Readhead Dr Donaldson Mr Jewell Mr Bowler Mr Watkins Executives Mr Barrett Mr Andrade 8,351,651 8,351,651 12,000 2,233,333 410,000 12,543,333 6,650,001 Appointments during the period 31 December 2011 500,000 500,000 12,000 1,733,333 410,000 12,543,333 6,150,001
Purchased -
Exercise of options -
Sold
For the six months ended 31 December 2010: 1 January 2010 Directors Mr Readhead Dr Donaldson Mr Jewell Mr Bowler Mr Watkins Executives Mr Barrett Mr Torresini* *resigned during period No shares were granted to key management personnel during the reporting period as compensation. 8,351,651 282,964 8,351,651 282,964 12,000 2,233,333 410,000 12,543,333 6,650,001 Appointments during the period 31 December 2010 12,000 2,233,333 410,000 12,543,333 6,650,001
Purchased -
Exercise of options -
Sold
30. GROup EnTITIES

Country of incorporation Parent entity Beadell Resources Ltd Signicant Subsidiaries Beadell Resources (Holdings) Ltd Beadell Resources Mineracao (Holdings) Ltd Beadell Resources Minerao Ltda Beadell (Brazil) Pty Ltd Beadell (Brazil 2) Pty Ltd Beadell Brasil Ltda Australia British Virgin Islands British Virgin Islands Brazil Australia Australia Brazil 100% 100% 100% 100% 100% 100% Interest
75

(Continued) 31. SubSEquEnT EVEnTS
On 12 March 2012 the Company issued 58,097,806 shares to sophisticated and professional investors at $0.73 per share, raising gross proceeds of $42,411,398. All shares were fully paid. As announced on the ASX on 5 March 2012, the Group is negotiating a US$20 million increase in its existing Syndicated Facility Agreement with Macquarie Bank Limited. The extension will require that an additional 50,000 ounces be hedged prior to draw down on the extended facility. There have been no other events subsequent to balance date which would have a material effect on the Groups nancial statements.
32. GOVERnmEnT gRAnTS

In June 2011 the Group entered into an agreement with the Western Australian State Government and was awarded two drilling grants as part of the Royalties for Regions Exploration Incentive Scheme (Funding Agreement). Under the terms of the Funding Agreement, amounts are payable as a reimbursement of 50% of direct drilling costs invoiced (Funding Amount) on certain tenements. The total Funding Amount granted to the Company was $298,750 for drilling to be completed prior to 31 December 2012 of which no amount is receivable as at 31 December 2011.
33. DEEd OF CROSS guARAnTEE

Pursuant to ASIC Class Order 98/1418 the wholly owned Beadell (Brazil) Pty Ltd and Beadell (Brazil 2) Pty Ltd are relieved from the Corporations Act 2001 requirements for preparation, audit and lodgement of nancial reports and Directors reports. It is a condition of the class order that the Company and each of the subsidiaries enter into a Deed of Cross Guarantee. The effect of the Deed is that the Company Guarantees to each creditor payment in full in the event of a winding up. The subsidiaries have also given similar guarantees in the event the Company is wound up. A consolidated statement of comprehensive income and a consolidated statement of nancial position, comprising the Company and controlled entities which are a party to the Deed, after eliminating all transactions between the parties are as set out below. The comparative period has been restated to remove the companies subject to the Deeds consolidated investment in Beadell Brasil Ltda, incorporating its revenue, other income and expenses and its underlying assets and liabilities. Consolidated 31 December 31 December 2011 2010 $000 $000 (12 months) (6 months) 371 226 (43,256)* (13,865)* (7,061) (4,046) (49,946) (17,685) 1,368 1,368 (48,578) 157 (48,421) (48,421) (48,421) 501 (2,591) (2,090) (19,775) (19,775) (19,775) (19,775)
Statement of comprehensive income Other income Administrative expenses Project exploration and evaluation expenses Results from operating activities Finance income Finance expenses Net nance income Loss for the period before income tax Income tax recovery Loss for the period after income tax Other comprehensive loss Other comprehensive loss for the period net of tax Total comprehensive loss for the period Loss attributable to: Equity holders of the Company Loss for the period * Administrative expenses include impairments on investments in subsidiaries.
(48,421) (48,421)
(19,775) (19,775)
Consolidated 31 December 31 December 2011 2010 $000 $000 3,747 163 471 279 4,660 1,614 130 13,454 34,400 1,137 50,735 55,395 2,218 424 2,642 58 58 2,700 52,695 124,500 10,588 (82,393) 52,695 12,165 91 319 12,575 1,614 146 35,582 14,523 250 52,115 64,690 822 191 1,013 57 57 1,070 63,620 95,566 2,026 (33,972) 63,620
Statement of nancial position Assets Cash and cash equivalents Prepayments Trade and other receivables Other current assets Total current assets Exploration and evaluation assets Property, plant and equipment Investments Loans receivable Other non-current assets Total non-current assets Total assets Liabilities Trade and other payables Employee benets Total current liabilities Trade and other payables Total non-current liabilities Total liabilities Net assets Equity Share capital Reserves Accumulated losses Total equity
34. AudITORS REmunERATIOn

Consolidated 31 December 31 December 2011 2010 $ $
Statement of nancial position Audit services KPMG Australia Audit and review of nancial reports Overseas KPMG rms Audit and review of nancial reports Audit services Other services KPMG Australia Taxation services Overseas KPMG rms Taxation services Other services
100,323 74,554 174,877
75,732 66,075 141,807
23,350 5,982 29,332
13,540 7,342 20,882
77

(Continued) 35. PAREnT EnTITY
As at and during the period ending 31 December 2011 the parent company of the Group was Beadell Resources Ltd. 12 months 6 months ended ended 31 December 31 December 2011 2010 Result Loss for the period Other comprehensive income Total comprehensive loss Financial position Current assets Total assets Current liabilities Total liabilities Net assets Equity Share capital Reserves Accumulated losses Total equity (48,423) (48,423) 4,681 55,393 2,642 2,700 52,693 124,500 10,588 (82,395) 52,693 (18,746) (18,746) 12,824 64,690 1,013 1,070 63,620 95,566 2,026 (33,972) 63,620
Parent entity contingencies

The parent entity has entered into a Deed of Cross Guarantee with two of its wholly owned subsidiaries. The effect of the Deed of Cross Guarantee is that the Company guarantees debts in respect of these subsidiaries. Further details of the Deed of Cross Guarantee and the subsidiaries subject to the Deed are disclosed in note 33.
78
DIRECTORS DECLARATION
1. a) In the opinion of the directors of Beadell Resources Limited (the Company): the consolidated nancial statements and notes 1 to 35 that are contained within and the Remuneration report in the Directors report, set out in section 4.3, are in accordance with the Corporations Act 2001, including: i) giving a true and fair view of the Groups nancial position as at 31 December 2011 and of its performance for the nancial year ended on that date; and
ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001; and b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. There are reasonable grounds to believe that the Company and the group entities identied in note 33 will be able to meet any obligations or liabilities to which they are or may become subject to by virtue of the Deed of Cross Guarantee between the Company and those group entities pursuant to ASIC Class Order 98/1418. The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the chief executive ofcer and chief nancial ofcer for the period ended 31 December 2011. The directors draw attention to note 2(a) to the consolidated nancial statements, which includes a statement of compliance with International Financial Reporting Standards.
2.
3.
4.
Signed in accordance with a resolution of the directors:
PETER BOWLER
Managing Director Dated at Perth, this 23rd day of March 2011.
79
INDEPENDENT AUDITORS REPORT
80
81
AUDITORS INdEpENdENCE dEClaRaTION
Lead Auditors Independence Declaration under Section 307C of the Corporations Act 2001 To: the directors of Beadell Resources Limited I declare that, to the best of my knowledge and belief, in relation to the audit for the financial year ended 31 December 2011 there have been: (i) (ii) no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and no contraventions of any applicable code of professional conduct in relation to the audit.
KPMG
Graham Hogg Partner Perth 23 March 2012
KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative.
82
ADDITIONAL SHaREHOldER INFORMATION

As at 31 March 2012
a)
Substantial Shareholders lodged with the Company Number of Shares Held 48,737,792 % of Shares Held 7.4%
Name of Ordinary Shareholder L1 Capital Pty Limited
b) Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 15 17 18 19 20
Listing of 20 Largest Shareholders Name of Ordinary Shareholder National Nominees Ltd HSBC Custody Nominees (Australia) Ltd JP Morgan Nominees Australia Ltd JP Morgan Nominees Australia Ltd Cash Income Account Citicorp Nominees Pty Ltd UBS Wealth Management Australia Nominees Pty Ltd Cogent Nominees Pty Ltd Equity Trustees Ltd Oz Minerals Investments Pty Ltd AMP Life Ltd UBS Nominees Pty Ltd HSBC Custody Nominees (Australia) Ltd Pershing Australia Nominees Pty Ltd CS Fourth Nominees Pty Ltd Braidwood Investments Pty Ltd Hookipa Pty Ltd Twynam Agricultural Group Pty Ltd Robert Holmes Watkins Citicorp Nominees Pty Ltd Lujeta Pty Ltd Number of Shares Held 157,406,127 101,132,057 78,874,138 35,903,575 33,016,649 16,497,040 13,229,213 12,800,000 12,800,000 12,331,993 10,149,664 9,899,386 9,885,021 9,622,200 9,100,001 7,254,650 5,975,000 5,850,001 5,444,305 5,376,042 % of Shares Held 22.0% 14.1% 11.0% 5.0% 4.6% 2.3% 1.9% 1.8% 1.8% 1.7% 1.4% 1.4% 1.4% 1.3% 1.3% 1.0% 0.8% 0.8% 0.8% 0.8%
83
ADDITIONAL SHaREHOldER INFORMATION

(Continued)
c) Distribution of shareholders Total holders 313 732 730 1,681 266 3,722 Units 117,899 2,337,746 5,991,927 55,000,440 652,556,740 716,004,752 % Issued capital 0.02 0.33 0.84 7.68 91.13 100.00
Range 1 1,000 1,001 5,000 5,001 10,000 10,001 100,000 100,001 over Total d) e)
Number of shareholders holding less than a marketable parcel is 225 Voting rights i) Ordinary Shares On a show of hands every shareholder present in person or by proxy shall have one vote and upon a poll, each share shall have one vote.
ii) Options The Companys options have no voting rights. f) Stock exchange listing Beadell Resources Limited shares are listed on the Australian Stock Exchange. The Companys ASX code is BDR. Unlisted share options Exercise price $0.30 $0.35 $0.50 $0.12 $0.1875 $0.1875 $0.65 $0.80 $0.80 Expiry date 30 June 2012 30 June 2012 30 June 2012 30 June 2013 21 April 2014 30 June 2014 30 June 2014 1 January 2015 1 January 2015 Number of holders 2 3 3 6 2 10 7 1 2
g)
Number of options 200,000 1,500,000 1,500,000 2,300,000 10,000,000 22,830,000 2,250,000 500,000 550,000
Macquarie Bank Ltd and Macquarie Capital Group Ltd each hold 5,000,000 Unlisted Share Options, representing 24% of the number of Unlisted Share Options on issue. Braidwood Investments (WA) Pty Ltd holds 11,500,000 Unlisted Share Options, representing 28% of the number of Unlisted Share Options on issue.
84
designcity.com.au
www.beadellresources.com.au

2011 Annual Report Final

Загружено:

Сведения о документе

Исходное описание:

Авторское право

Доступные форматы

Поделиться этим документом

Поделиться или встроить документ

Параметры публикации

Этот документ был вам полезен?

Это неприемлемый материал?

Авторское право:

Доступные форматы

2011 Annual Report Final

Загружено:

Авторское право:

Доступные форматы

ACN 125 222 291

Annual Report 2011

LETTER FROM CHAIrmAN AND MANAGING DIRECTOR

PETER BOWLER Managing Director

CRAIG READHEAD Non-Executive Chairman

Figure 1 Brazil Projects location plan

Tucano site transport

Mining operations at AB1 pit

Beadell Resources Limited Annual Report 2011

Silvano de Souza Andrade Brazilian General Manager

CIL Process Plant Construction

Resource and Reserve Development

Blast hole rig in action

Beadell Resources Limited Annual Report 2011

Excavator Operator AB1

Excavator in action AB2 Figure 2 Location of Gold Pits Tucano

Blasting AB2 pit

Figure 3 Longsection Urucum gold deposit

Beadell Resources Limited Annual AnnualReport Report2009 2011

CIL tanks at completed height

Welding CIL tank

Tap AB2 gold and iron ore open pit

Blasting AB2 pit

Beadells in-pit blast hole Drill Rig

Beadell Resources Limited Annual Report 2011

Figure 4 Tucano Banded Iron Formation Resource and Target Location

COMMUNITY & ENVIRONMENT

Dispatch Room Pamella Carvalho

MD Peter Bowler and GM Silvano Andrade

View from top of Gold Circuit

Beadell Resources Limited Annual Report 2011

Loading of Track Mounted RC Rig bound for Tucano

Enviromental team at work

Enviromental team at work Rayssa Amaral Barros; Biologist

Figure 5 Australian projects Location Plan

WEST MUSGRAVE Handpump Prospect

VICTORIA Reedy Creek Project

Geological Survey of Western Australia eld trip to Tropicana belt

Geological Survey of Western Australia eld trip to Tropicana belt

resoUrce & reserves

5.8 1.5 7.4 7.4

0.85 0.95 0.87 0.87

159 47 206 206 19 1.70 1039

5.8 1.5 7.4 26.4

0.85 0.95 0.87 1.47

159 47 206 1245 0.65

Beadell Resources Limited Annual Report 2011

Iron Ore Resources

Indicated Inferred Total Measured

Indicated Inferred Total Measured

Indicated Inferred Total

18.1 29.1 2.9 72.5 133.7 209.1

36.5 33.6 40.4 37.2 35.4 36.1

Measured Total Tucano Indicated Inferred Total

Brazil, Tartarugalzhino DNPM. 851.439/1980

858078/2007 858063/1995 858076/2009 858077/2009 858046/2009

0.4984 52.175 880.941 12.393 262.134

Beadell Resources Limited Annual Report 2011

Name and qualications

Experience, special responsibilities and other Directorships

A Number of meetings attended B Number of meetings held while in ofce

4. CORpORATE gOVERnAnCE STATEmEnT

Role of the board