Forte Energy NL

LSE : FTE


May 01, 2013 02:00 ET

Quarterly Activities and Cashflow Report

                                                                                          Forte Energy NL
                                                                                                         
                                                                                          ACN 009 087 852
                                                                                                        
                                      Quarterly Report - March 2012

Forte  Energy  NL  ("Forte Energy" or "the Company") (ASX/AIM: FTE) is an emerging international  uranium
company  focused on the exploration and development of a portfolio of uranium assets in the Republics  of
Mauritania and Guinea, West Africa.

                              Highlights of 1st Quarter to 31st March 2013
-----------------------------------------------------------------------------------------------------------


    *  On the 15th February the Company  entered into a £10 million Equity
       Financing Facility ("EFF") with Darwin Strategic Limited ("Darwin"), a
       majority owned subsidiary of Henderson Global Investors' Volantis Capital
       ("Henderson Volantis")

    *  On 6 March 2013 the Company completed the placement of 29,250,000
       Shares each at an issue price of £0.0201 (Placement Shares) to raise
       £587,177 (before costs)

    *  A 5,000m drilling contract signed with Wallis Drilling Africa Pty Ltd
        
    *  Drilling  in the highly prospective areas close to the A238 prospect and at Hassi  Baida  is
       scheduled to start in Mid-May, following the shipment of the drill rig to Mauritania

    *  Forte Energy U3O8 JORC resources (all at a 100ppm cut-off):

         ---------------------------------------------------------------------------------------
         Project                Resource           Tonnage            Grade            Contained
                                Category             (Mt)           (ppm U3O8)         U3O8 Mlbs
         ---------------------------------------------------------------------------------------
         A238*                  Inferred             45.2              235                23.4
         ---------------------------------------------------------------------------------------
         Bir En Nar             Indicated            0.5               886                1.0
         ---------------------------------------------------------------------------------------
                                Inferred             0.8               575                1.0
         ---------------------------------------------------------------------------------------
         Firawa                 Inferred             30.3              295                19.5
         ---------------------------------------------------------------------------------------
                                Indicated            0.5               886                1.0
                                ----------------------------------------------------------------
         Total                  Inferred             76.3              262                43.9
                                ----------------------------------------------------------------
                                  Total              76.8              266                44.9
         ---------------------------------------------------------------------------------------
        
        * A238NW Anomaly included in the A238 Inferred Resources

Progress

Commenting on the quarter, Mark Reilly, Managing Director of Forte Energy, said:

"Having  secured access to funding through the Darwin Equity Financing Facility, a portion of  which  has
been  drawn down during this quarter, Forte has ensured that it is well positioned to continue adding  to
the  Company's already considerable resource base in Mauritania.  We look forward to updating the  market
with  results  from  the highly prospective areas close to A238 and from the calcrete deposits  at  Hassi
Baida following the completion of the drilling campaign."

Republic of Mauritania, West Africa

Forte Energy has ten 100% owned licences over 7,000km2 in Mauritania.
                                                    
To view Figure 1: Mauritanian Licences, please open the link in a new window:

http://media3.marketwire.com/docs/FORTEFIG10501.jpg

The Company received chemical assay results during the quarter from the Reverse Circulation (RC) drilling
program  completed  at the A238 Prospect in Mauritania in December, 2012. The program included  28  holes
drilled, totalling 4,115m and covered the structural extensions identified in the high resolution  ground
magnetic and radiometric surveys to the north and south of the existing A238 Resource.

A  total  of 12 holes were drilled up to 2km to the north of the existing A238 Resource at 200m  spacing.
Positive  assay  results from five of the holes located over 0.8km to the north of A238 indicated  narrow
mineralised  structures  over a strike length of 0.5km. Assay results from RC 222 indicated  intermittent
mineralisation from 53m to 100m below surface, with grades of up to 567ppm U308.

During  the  quarter the Company also conducted an evaluation of the structurally controlled metasomatite
uranium/Thorium  (U/Th)  mineralisation systems and further targets for exploration  in  Mauritania.  The
objective was to systematically review the regional data base to define any further potential targets  of
structurally controlled uranium targets situated along the main structural trends within and adjacent  to
the Forte Mauritanian Project area.

The  study was successful in applying simple, selective criteria that helped in identifying further zones
of  potential  metasomatite U/Th mineralisation systems within the Forte licence areas.  A  total  of  27
targets  were  identified along major NW and WNW structures within the Forte Mauritanian  licences.  Four
high  priority  targets  were identified, two of which are located within  an  8km  radius  of  the  A238
prospect.

On  10th April the Company announced that a contract had been signed with Wallis Drilling Africa Pty  Ltd
for  approximately  5,000m  of NQ Aircore drilling in the highly prospective  areas  close  to  the  A238
prospect and at Hassi Baida.

Hassi  Baida is a highly prospective calcrete area situated approximately 50km north-east of the existing
Forte Energy licences and covers over 800km2. The drilling programme will target eight separate prospects
within the Hassi Baida licence. The targets are all uranium in superficial calcrete deposits.

The  5,000m  programme  will also include aircore scout drilling which will target  blind,  near  surface
metasomatite style uranium mineralisation along interpreted major structural corridors close to the  A238
Prospect.

Republic of Guinea, West Africa

Firawa

The  Firawa  Project consists of two 100% owned licences totalling 549km2 which are located approximately
25km to the east of Kissidougou.

To view Figure 2: Guinea Licences, please open the link in a new window:

http://media3.marketwire.com/docs/FORTEFIG20501.jpg

No significant works were carried out in Guinea during the quarter.


Corporate

The  Company entered into detailed negotiations on several prospective corporate transactions during  the
quarter however agreement could not be reached on terms that were acceptable to the Company at that time.

The Company is continuing to assess alternative opportunities, and will update the market if and when any
developments occur.

On 15th February 2013, Forte Energy announced that it had entered into a £10 million discretionary Equity
Financing  Facility  ("EFF")  with Darwin Strategic Limited ("Darwin"), a majority  owned  subsidiary  of
Henderson Global Investors' Volantis Capital ("Henderson Volantis").

During  March,  the Company raised £587,177 before expenses by way of the issue of 29,250,000  shares  to
Darwin Strategic under the EFF. The shares were issued at a price of 2.01p (A$ 2.98 cents) per share. The
Company  has  the capacity to draw down a further £9.4million (A$14.1million) under the facility  as  and
when required.


Mark Reilly
Managing Director

For further information contact:

Mark Reilly, Managing Director
Forte Energy NL                              Tel: +44 (0) 203 3849555


Geoff Nash/Ben Thompson                      Tel: +44 (0)207 220 0500
Elizabeth Johnson (broking)
finnCap

Bobby Morse/Louise Hadcocks/Cornelia Browne
Buchanan                                     Tel: +44 (0) 207 466 5000

Stuart Laing
RFC Ambrian Ltd                              Tel: +61 (0) 8 9480 2506
(AIM Nominated Adviser to the Company)

Forte Energy NL

Australia                                        United Kingdom

Suite 3, Level 3                                 3C Princes House
1292 Hay Street                                  38 Jermyn Street
West Perth WA 6005                               London SW1Y6DN
Ph: +61 (0)8 9322 4071                           Ph: +44 (0)203 3847474
Fax: +61 (0)8 9322 4073                          Fax: +44 (0)207 2878387
Email: info@forteenergy.com.au                   Email: info@forteenergy.co.uk
Web: www.forteenergy.com.au


About Forte Energy

Forte  Energy  is  an  Australian-based minerals company focused on the exploration  and  development  of
uranium  and associated bi-products in Mauritania and Guinea in West Africa. The Company has an extensive
pipeline  of  assets and total JORC resources of 76.8Mt @ 266ppm U3O8for 44.9Mlbs contained U3O8  (100ppm
cut-off).

Its  flagship assets are the A238 prospect (23.4Mlbs U3O8) and the Bir En Nar project (2.06Mlbs U3O8)  in
Mauritania, and the Firawa Project in Guinea (19.5Mlb U3O8).

Forte Energy U3O8 JORC resources (all at a 100ppm cut-off):

-------------------------------------------------------------------------------------------------------
Project              Resource Category         M tonnes         ppm U3O8           Contained U3O8 Mlbs
-------------------------------------------------------------------------------------------------------
A238*                         Inferred             45.2              235                          23.4
-------------------------------------------------------------------------------------------------------
Bir En Nar                   Indicated              0.5              886                           1.0
                             --------------------------------------------------------------------------
                              Inferred              0.8              575                           1.0
-------------------------------------------------------------------------------------------------------
Firawa                        Inferred             30.3              295                          19.5
-------------------------------------------------------------------------------------------------------
Total                        Indicated              0.5              886                           1.0
                             --------------------------------------------------------------------------
                              Inferred             76.3              262                          43.9
                             --------------------------------------------------------------------------
                                 Total             76.8              266                          44.9
-------------------------------------------------------------------------------------------------------

        * A238NW Anomaly included in the A238 Inferred Resources
    
Forte  Energy's  strategy is to target high grade uranium ore bodies and build a low cost  West  African-
focused  uranium  producer. The Company is quoted on the Australian Stock Exchange  (ASX:  FTE)  and  AIM
market of the London Stock Exchange (AIM: FTE). For more information, visit www.forteenergy.com.au

Note:

The information in this report that relates to the reporting of Mineral Resources is based on information
compiled  by  Mr.  Galen  White, who is a Fellow of the Australasian Institute of Mining  and  Metallurgy
(FAusIMM).  The Mineral Resources have been estimated and reported in accordance with the  guidelines  of
the  Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC
Code  2004). Mr White is the Principal Geologist of CSA Global (UK) Ltd. CSA Global have an on-going role
as  geological consultants to Forte Energy NL. Mr. White has sufficient experience which is  relevant  to
the  style  of  mineralisation and type of deposit under consideration and to the activity  which  he  is
undertaking to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for
Reporting  of  Exploration  Results,  Mineral Resources and Ore Reserves'.  Mr.  White  consents  to  the
inclusion  in  this report of the matters based on his information in the form and context  in  which  it
appears.


Appendix 5B

Mining exploration entity quarterly report

Introduced 1/7/96.  Origin:  Appendix 8.  Amended 1/7/97, 1/7/98, 30/9/2001, 01/06/10.

Name of entity
----------------------------------------------------------------------------------------------
FORTE ENERGY NL
----------------------------------------------------------------------------------------------

ABN                                                       Quarter ended ("current quarter")
-------------------------------------------     ----------------------------------------------
59 009 087 852                                                          31 March 2013
-------------------------------------------     ----------------------------------------------

                                                            -----------------------------------
                                                            Current quarter       Year to date
Cash flows related to operating activities                       A$'000            (9 months)
                                                                                     A$'000
                                                            -----------------------------------
1.1       Receipts from product sales and related debtors              -                   -
1.2       Payments for  (a)  exploration and evaluation            (358)             (1,897)
               (b)  development                                        -                   -
               (c)  production                                         -                   -
               (d)  administration                                 (488)             (1,593)
1.3       Dividends received                                           -                   -
1.4       Interest  and  other items of a  similar  nature                                  
          received                                                     1                   7
1.5       Interest and other costs of finance paid                     -                   -
1.6       Income taxes paid                                            -                   -
1.7       Other (provide details if material)                          -                   -
                                                            -----------------------------------
          Net Operating Cash Flows                                 (845)             (3,483)
-----------------------------------------------------------------------------------------------
          Cash flows related to investing activities                                        
1.8       Payment for purchases of:                                                         
               (a) prospects                                           -                   -
               (b) equity investments                                  -                   -
               (c) other fixed assets                                  -                (16)
1.9       Proceeds from sale of:                                                            
               (a) prospects                                           -                   -
               (b) equity investments                                  -                   -
               (c) other fixed assets                                  -                   -
1.10      Loans to other entities                                      -                   -
1.11      Loans repaid by other entities                               -                   -
1.12      Other (provide details if material)                          -                   -
                                                            -----------------------------------
          Net investing cash flows                                     -                (16)
                                                            -----------------------------------
1.13      Total   operating  and  investing   cash   flows         (845)             (3,499)
          (carried forward)
-----------------------------------------------------------------------------------------------


Consolidated statement of cash flows

-----------------------------------------------------------------------------------------------
1.13      Total   operating  and  investing   cash   flows         (845)             (3,499)
          (brought  forward)
-----------------------------------------------------------------------------------------------

          Cash flows related to financing activities                                        
1.14      Proceeds from issues of shares, options, etc.              825               2,205
1.15      Proceeds from sale of forfeited shares                       -                   -
1.16      Proceeds from borrowings                                     -                   -
1.17      Repayment of borrowings                                      -                   -
1.18      Dividends paid                                               -                   -
1.19      Other - Settlement of Guarantee                                                   
                                                            -----------------------------------
          Net financing cash flows                                   825               2,205
-----------------------------------------------------------------------------------------------
                                                                                            
          Net increase (decrease) in cash held                      (20)             (1,294)
          
1.20      Cash at beginning of quarter/year to date                  489               1,763
1.21      Exchange rate adjustments to item 1.20                       -                   -
                                                            -----------------------------------
1.22      Cash at end of quarter                                     469                 469
-----------------------------------------------------------------------------------------------
Payments to directors of the entity and associates of the directors
Payments to related entities of the entity and associates of the
related entities

                                                                              ---------------
                                                                              Current quarter
                                                                                  $A'000
                                                                              ---------------
                                                                                             
        Aggregate  amount of payments to the parties included  in  item                   169
        1.2
                                                                              ---------------
        Aggregate amount of loans to the parties included in item 1.10                      0
---------------------------------------------------------------------------------------------

        Explanation necessary for an understanding of the transactions
        
        -----------------------------------------------------------------------------------
        Salaries and rental of office premises
        -----------------------------------------------------------------------------------

Non-cash financing and investing activities

2.1     Details of financing and investing transactions which have had a material effect on
        consolidated assets and liabilities but did not involve cash flows
        -----------------------------------------------------------------------------------
        Nil
        -----------------------------------------------------------------------------------

2.2     Details  of  outlays  made  by other entities to establish or  increase  their  share  in
        projects in which the reporting entity has an interest
        -----------------------------------------------------------------------------------
        Nil
        -----------------------------------------------------------------------------------

Financing facilities available

Add notes as necessary for an understanding of the position.

                                             ----------------------------------------
                                                Amount available          Amount used
                                                $A'000                    $A'000
                                             ----------------------------------------
3.1       Loan facilities                                  Nil                    N/A
                                             ----------------------------------------
3.2       Credit standby arrangements                      Nil                    N/A
-------------------------------------------------------------------------------------

Estimated cash outflows for next quarter
                                                                                    --------
                                                                                     $A'000
                                                                                    --------
4.1     Exploration and evaluation                                                     150
                                                                                    --------
4.2     Development                                                                      -
                                                                                    --------
4.3     Production                                                                       -
                                                                                    --------
4.4     Administration                                                                 350
--------------------------------------------------------------------------------------------
          Total                                                                        500
--------------------------------------------------------------------------------------------

Reconciliation of cash
                                                         -----------------------------------------
Reconciliation  of cash at the end of  the  quarter      Current quarter       Previous quarter
(as  shown  in the consolidated statement  of  cash          $A'000                 $A'000
flows) to the related items in the accounts  is  as
follows.
--------------------------------------------------------------------------------------------------
5.1     Cash on hand and at bank                                 469                   489
                                                         -----------------------------------------
5.2     Deposits at call                                           -                     -
                                                         -----------------------------------------
5.3     Bank overdraft                                             -                     -
                                                         -----------------------------------------
5.4     Other (provide details)                                    -                     -
--------------------------------------------------------------------------------------------------
        Total: cash at end of quarter (item 1.22)                469                   489
--------------------------------------------------------------------------------------------------

Changes in interests in mining tenements

                               -------------------------------------------------------------------
                               Tenement       Nature of interest      Interest   at  Interest  at
                               reference      (note (2))              beginning  of  end       of
                                                                      quarter        quarter
                               -------------------------------------------------------------------
6.1     Interests  in  mining                                                        
        tenements
        relinquished,
        reduced or lapsed
                               -------------------------------------------------------------------
6.2     Interests  in  mining                                                        
        tenements    acquired
        or increased
                               -------------------------------------------------------------------
                               
Issued and quoted securities at end of current quarter

Description  includes rate of interest and any redemption or conversion rights together with  prices  and
dates.

                                       -------------------------------------------------------------
                                       Total number    Number quoted    Issue price   Amount paid up
                                                                       per security     per security
                                                                       (see note 3)     (see note 3)
                                                                            (cents)          (cents)
----------------------------------------------------------------------------------------------------
7.1     Preference +securities                                                                  
        (description)
                                       -------------------------------------------------------------
7.2     Changes during quarter                                                                      
        (a)  Increases through                                      
        issues
        (b)  Decreases through
        returns of capital, buy-
        backs, redemptions
----------------------------------------------------------------------------------------------------
7.3     +Ordinary securities          902,145,311      902,145,311                                
                                        2,250,000                -             25                1
                                       -------------------------------------------------------------
7.4     Changes during quarter                                                                      
        (a) Increases through                                                                     
        issues                                                                                    
        Issue for cash                 29,251,000       29,251,000     2.98 cents       2.98 cents
         (b)  Decreases through                                                                   
        returns of capital, buy-                                                                  
        backs                                                     
----------------------------------------------------------------------------------------------------
7.5     +Convertible debt                                                                
        securities (description)
                                       -------------------------------------------------------------
7.6     Changes during quarter                                                                    
        (a)  Increases through
        issues
        (b)  Decreases through
        securities matured,
        converted
----------------------------------------------------------------------------------------------------
7.7     Options  (description  and                                         Exercise    Expiry date
        conversion factor)                                                    price               
                                                                                                  
                                        1,000,000                -          6 pence      1/09/2016
                                        4,000,000                -       12.5 cents     14/04/2015
                                       88,652,500                -          3 pence      3/08/2013
                                        5,000,000                -          3 pence     14/02/2015
                                       -------------------------------------------------------------
7.8     Issued during quarter           5,000,000                -          3 pence     14/02/2015
                                       -------------------------------------------------------------
7.9     Exercised during quarter                                                                  
                                       -------------------------------------------------------------
7.10    Expired during quarter                                                                    
----------------------------------------------------------------------------------------------------
7.11    Debentures                                                                                  
        (totals only)
----------------------------------------------------------------------------------------------------
7.12    Unsecured notes                                                                             
        (totals only)
        -----------------------------------------------------------

Compliance statement

1     This  statement has been prepared under accounting policies, which comply with accounting  standards
      as defined in the Corporations Act or other standards acceptable to ASX (see note 4).

2     This statement does give a true and fair view of the matters disclosed.





Sign  here:     ............................................................   Date: 30 April 2013.
                Company Secretary

Print name:     ....Murray Wylie...............................


Notes

1     The  quarterly  report provides a basis for informing the market how the entity's  activities  have
      been  financed  for  the past quarter and the effect on its cash position.  An  entity  wanting  to
      disclose  additional  information is encouraged to do so, in a  note  or  notes  attached  to  this
      report.

2     The  "Nature  of interest" (items 6.1 and 6.2) includes options in respect of interests  in  mining
      tenements acquired, exercised or lapsed during the reporting period.  If the entity is involved  in
      a  joint  venture  agreement and there are conditions precedent, which will change  its  percentage
      interest  in a mining tenement, it should disclose the change of percentage interest and conditions
      precedent in the list required for items 6.1 and 6.2.

3     Issued  and quoted securities  The issue price and amount paid up is not required in items 7.1  and
      7.3 for fully paid securities.

4     The  definitions  in, and provisions of, AASB 1022: Accounting for Extractive Industries  and  AASB
      1026: Statement of Cash Flows apply to this report.

5     Accounting  Standards  ASX will accept, for example, the use of International Accounting  Standards
      for  foreign  entities.  If the standards used do not address a topic, the Australian  standard  on
      that topic (if any) must be complied with.

Contact Information

  • Forte Energy NL