GCM Resources plc Chairman Michael Tang said, the last twelve months have been challenging for the junior mining sector as commodity markets continue to deteriorate and raising new funding has become particularly difficult for any mining company that is not producing.
In contrast to the decline in global demand for coal, Bangladesh, where GCM’s operations are located, is expected to
see a significant increase in demand for high quality thermal coal in-country as the Government continues to
restructure the country’s power sector towards coal. The Bangladesh Government plans to generate over 19,000MW
from coal by 2030, and is currently considering coal-fired power plants with a combined generation capacity of
13,316MW. While the current plans assume coal is imported there is a strong case for the country to use its own
indigenous resources.
The Company agreed a two year, £3 million convertible loan facility on 29 May 2015 which may be drawn down as
and when required and will assist in financially supporting GCM’s activities as it continues to pursue approval of the
Phulbari Coal Project (the Project). As at 30 June 2015 GCM had drawn down £0.2 million from the convertible
loan facility (£0.51 million as at 19 November 2015). While achieving approval continues to be a challenge, the
Board believes that it is in the best interests of all stakeholders that the Project is developed. To this end the Board’s
strategy is to present the Project to the satisfaction of the Government of Bangladesh and to secure an agreement that
meets the objectives of both parties.
Understanding the importance of local community support the Company has continued its engagement activities
throughout the year, retaining a working relationship with community leaders and understanding the views of local
residents from a diverse range of backgrounds. The Company has met around 2,500 people since it first started its
re-engagement activities in late 2012.
Finally, we saw the successful closure of the OECD examination on 10 September 2015 after a thorough and
impartial examination which first started in December 2012. I reiterate our commitment that the Project developed
by GCM will be undertaken with integrity and fairness for all stakeholders, and in adherence to the highest
international and national environmental and social standards. The Project can be a catalyst for economic growth
and social development both within the region and throughout the country and I look forward to making progress
towards its implementation for the benefit of all stakeholders.
Our financial results reflect our focus on keeping costs under control while pursing Project approval. The Group
incurred a loss of £0.9 million for the year ended 30 June 2015 compared to £1.3 million last financial year and £3.2
million in 2013. Project related expenditure of £0.6 million for the year was also kept at a minimum (2014: £0.8
I would like to thank the Board and staff for all their hard work over the last twelve months and to the shareholders
for their continued perseverance and support during these challenging times.
The Income Statement, Statement of Comprehensive Income, Statement of Changes in Equity, Balance Sheet and
Cash Flow are presented on the following pages.