ANNUAL Report June 2024 Notes to the Consolidated Financial Statements 41 New South Wales In November 2021, EQ Resources Limited entered into a binding Farm-In and Joint Venture Agreement with Sozo Resources Pty Ltd (“Sozo”) whereby Sozo can earn up to an 80% interest in EQR’s 100% owned NSW projects, Crow Mountain (EL6648) and Panama Hat (EL8024), by completing expenditure of $1.6 million over 4 years as follows: ▪ Stage 1 – Sozo to complete $100K of expenditure within 9 months from the Agreement Commencement Date; ▪ Stage 2 – Sozo is to spend a further $750K of expenditure within an additional 24 months to earn a 49% interest. If Sozo elects to continue sole funding exploration expenditure at the end of Stage 2, it will have earned a further 2% (51% in total), and a Joint Venture will be formed; and ▪ Stage 3 – Sozo is to spend a further $750K of expenditure and complete a Scoping Study (as defined by the 2012 JORC Code) within an additional 24 months to earn a further 29% (in total, $1.6M for 80%). For further details, refer to ASX announcement “EQR Farms-Out NSW Projects to Focus on Mt Carbine Tungsten Mine” dated 26 November 2021. This agreement ensures that the Company’s minimum expenditure requirements, as shown in the table below, will be satisfied in order to maintain each tenement in good standing. 2024 $ 2023 $ Payable not later than 1 year (NSW only) - 118,000 Payable later than one year but not later than two years 160,000 160,000 160,000 278,000 It is also likely that the granting of new licences and changes in licence areas at renewal or expiry will change the expenditure commitment of the Group from time to time. 19. INVESTMENT IN SUBSIDIARIES Equity Interest Cost of Parent Entity’s Investment Parent Entity EQ Resources Limited 2024 % 2023 % 2024 $ 2023 $ Controlled Entities Mt Carbine Mining Pty Ltd 100 100 2 2 Mt Carbine Retreatment Pty Ltd 100 100 200 200 European Tungsten Pty Ltd2 100 100 1 1 Mt Carbine Quarrying Operations Pty Ltd 100 100 100 100 Mt Carbine Quarries Pty Limited 100 100 8,130,000 8,130,000 Icon Resources Africa Pty Ltd 100 100 10 10 Mt Carbine Retreatment Management Pty Ltd1 50 50 50 50 Saloro S.L.U. 100 - 2 - 1 Mt Carbine Retreatment Management Pty Ltd is the agent for the unincorporated joint venture between Mt Carbine Retreatment Pty Ltd and CRONIMET Australia Pty Ltd. 2 Formerly Troutstone Pty Ltd and is the holding company for Saloro. EQ Resources Limited and all its subsidiaries are located and incorporated in Australia except Saloro, wholly owned by European Tungsten Pty Ltd, domiciled in Spain. 20. IMPAIRMENT OF DEFERRED EXPLORATION EXPENDITURE AND PLANT AND EQUIPMENT The Directors reassess the carrying value of the Group’s assets, including deferred exploration expenditure, tenements and plant and equipment at each half year or at a period other than that, should there be any indication of impairment to fair value. When making their assessment for the 2024 financial year, the Directors considered the following: EQ Resources Limited Annual Report 2024 107
RkJQdWJsaXNoZXIy MjE2NDg3