Quarter Time Wrap

THE BOURSE WHISPERER: Quarterly reporting season is always a heavy burden on The Roadhouse’s virtual postman. The latest round was no exception. Here’s a random selection of what some companies had to say.

Red Sky Energy Limited (ASX: ROG)

Australian energy development company Red Sky Energy’s quarter ending 31 March was highlighted by a Product Ruling issued by the Australian Taxation Office (ATO) for the funding structure for the company’s utility scale solar power project.

Red Sky’s solar energy business, Soleir, continued to make further progress on its Dubbo solar one project, during the March quarter;

A Product Ruling was issued by the ATO in relation to the proposed funding structure for the project.

The project’s funding structure provides for investors to have unitised ownership in the project that will allow them to participate in the business and invest in the Dubbo solar one project, and provide certainty over the taxation benefits available under the funding structure.

This is the first time in Australia that unitised ownership of a utility scale solar project has been facilitated.

The Dubbo solar one project is proposed to be Red Sky’s first utility scale project and is being developed as a 2.5 megawatt (MW) project.

Red Sky acquired solar energy company, Soleir a developer of utility scale photovoltaic (PV) solar power projects, in November 2012 and its first project is in the major regional city of Dubbo in central New South Wales. Soleir has a 30 year lease for the project site and development approval for a 2.5MW project is in place.

In January Red Sky reached an agreement to sell its 20 per cent interest in permits PEL 457 and 479, in the Clarence Moreton Basin in northern NSW, to ERM Gas for approximately $1.6 million in cash.

Red Sky also relinquished its 18.75 per cent interest in a project (permit ATP 840) in southern Queensland.

The company has also been reviewing several gas opportunities, and due diligence has commenced on one of these Australian based projects.

BC Iron (ASX: BCI)

BC Iron delivered a solid quarter of sales while maintaining its FY14 guidance.

The company’s Nullagine Joint Venture (NJV) completed a quarter of sales with 1.22 million wet metric tonnes (wmt) of Bonnie Fines shipped, exceeding its wet season guidance of 1.13 million wmt (4.5 million tonnes per annum run rate).

January experienced the fourth heaviest rainfall recorded for that month in more than 100 years at the nearby Bonney Downs weather station, as the area was impacted by Tropical Cyclone Christine and other material rainfall events.

Rainfall in February and March was below average, which allowed the NJV to catch up from the periods of downtime experienced in January.

The wet weather affected load and haul activities, which had flow-on effects to the short term mine schedule and resulted in increased mining of waste compared to budget.

Consequently, ore mined of 0.95 million dry metric tonnes (dmt) was lower than wet season guidance rates.

However, the total material mined target was achieved and waste to ore ratios improved as the quarter progressed. Material from existing stockpiles provided supplemental crusher feed and total ore crushed for the quarter was 1.05 million wmt.

Project Inventory progressed during the quarter, with the low grade beneficiation trial completed.

Approximately 30,000 wmt of beneficiated product was blended with Direct Shipping Ore and exported at Bonnie Fines specifications.

A detailed evaluation of the trial is now underway, with the completion of all activities required to revise the NJV’s reserves and mine plan anticipated in mid-2014.

“The NJV met the challenges of an extremely wet January well to record strong March quarter sales of 1.22 million wet metric tonnes,” BC Iron managing director Morgan Ball said.

“We were also pleased our alliance with Cleveland Mining commenced drilling in Brazil.

“Greenfields exploration provides BC Iron with the potential for a longer term growth option to complement the shorter term focus of seeking to extend the NJV mine life through Project Inventory.”