These challenges have fostered an expanded network of suppliers and industry vendors building on historic relationships. Notably, our workforce has grown to over 95 employees, a significant increase from 65 the previous year, with a strong focus on employing local talent from the surrounding communities. The employee numbers have grown to accommodate increased production and administration requirements associated with the operation. We take pride in training and empowering local individuals, thereby reinvesting in the community. Operations at Mt Carbine operate on a 24/7 basis ensuring maximum production output. In accordance with the Offtake Agreement between the unincorporated JV, between the Company and CRONIMET Australia Pty Ltd, and CRONIMET Asia Pte Ltd, by the end of the financial year CRONIMET Asia has taken all concentrate produced on-site this year. Individual production lots are tested against mutually agreed quality parameters, including WO3 and moisture content. There continues to be a strong demand in the global market for the tungsten concentrates produced at Mt Carbine. Material Business Risks The Group continues to assess and manage various business risk with the potential to have material impact on the Group’s operating and financial performance and its ability to successfully achieve its corporate objectives. Section 14 of the 2021 Bankable Feasibility Study defines the Group’s risk framework which: − Describes the process for identifying risks and opportunities; − Describes the process for assessing risks using consistent management guidelines; − Identifies and assesses the material risks and defines appropriate measures to control these risks; − Establishes a process to ensure that risks and opportunities continue to be identified and compliance obligations satisfied; and − Ensures that the process is communicated to relevant stakeholders. The matters listed below are not listed in order of importance and are not intended to be an exhaustive list of all the risks and uncertainties affect the business. Market Risk The demand for, and the price of, tungsten, is highly dependent upon on a variety of factors, including international supply and demand, actions taken by governments and global economic and political developments. EQR’s operational and financial performance, as well as the economic viability of the Mt Carbine Mine, is heavily reliant on the price of tungsten. Operating and Financial Review continued Any sustained low price for tungsten may adversely affect EQR’s business and financial results, its ability to finance, and the financing arrangements for its future activities or its planned capital expenditure commitments. Key factors which affect the price of tungsten (many of which are outside the control of EQR) include, among many other factors, the quantity of global supply as a result of the commissioning of new mines and manufacturing facilities, and the decommissioning of others; political developments in countries which produce and consume material quantities; and the weather in such countries to name only a few. Given the range of factors which contribute to the price of tungsten, and the fact that pricing is subject to negotiation, it is difficult for EQR to predict with any certainty the prices at which tungsten will be sold. The effect of changes in assumptions about future prices may include, amongst other things, changes to Mineral Resources and Ore Reserves estimates and the assessment of the recoverable amount of EQR’s assets. Mineral Resources and Ore Reserves Mineral Resources and Ore Reserves are estimates of mineralisation that have reasonable prospects for eventual economic extraction in the future, as defined by the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (“JORC Code”). JORC Code compliant statements relating to EQR’s Ore Reserves and Mineral Resources are estimates only. An estimate is an expression of judgement based on knowledge, experience and industry practice. Estimates which were valid when originally calculated may alter significantly when new information or techniques become available. In addition, by their very nature, Resource estimates are imprecise and depend to some extent on interpretations, which may prove to be inaccurate. As further information becomes available through additional fieldwork and analysis, the estimates are likely to change and may be updated from time to time. This may result in alterations to mining plans or changes to the quality or quantity of EQR’s Ore Reserves and Mineral Resources, which may, in turn, adversely affect EQR’s operations. Mineral production involves risks, which even a combination of experience, knowledge and careful evaluation may not be able to adequately mitigate. No assurance can be given that the anticipated tonnages or grade of minerals will be achieved during production or that the indicated level of recovery rates will be realised. Additionally, material price fluctuations, as well as increased production and operating costs or reduced recovery rates, may render any potential mineral Resources or Reserves 14 EQ Resources Limited Annual Report 2023
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