Announcement PDF and its controlled entities 2020 ANNUAL REPORT ABN: 39 151 155 207 Annual Report 2020 CONTENTS DIRECTORS’ REPORT 3 REMUNERATION REPORT 20 AUDITORS’ INDEPENDENCE DECLARATION 26 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME 27 CONSOLIDATED STATEMENT OF FINANCIAL POSITION 28 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 29 CONSOLIDATED STATEMENT OF CASH FLOWS 30 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DIRECTORS’ DECLARATION 55 INDEPENDENT AUDITORS’ REPORT 56 SHAREHOLDER INFORMATION 60 CORPORATE DIRECTORY 64 SCHEDULE OF EXPLORATION TENEMENTS 65 Annual Report 2020 2 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT DIRECTORS’ REPORT Your directors present the following report on Estrella Resources Limited (“the Company”) and its wholly owned subsidiaries (together referred to hereafter as “the Group”) for the financial year ended to 30 June 2020. Directors The names of directors in office at any time during or since the end of the period are: Leslie Pereira Non-Executive Director John Kingswood Non-Executive Director Stephen Brockhurst Non-Executive Director Unless noted above, all directors have been in office since the start of the financial year to the date of this report. Principal activities The principal activities of the Group during the reporting period were to explore nickel and gold projects in Western Australia. Review of Operations Estrella Resources Limited (ASX: ESR) (Estrella or Company) is pleased to provide its Review of Operations for the full year ended 30 June 2020. Work Summary The focus of fieldwork and studies during the full year were the Carr Boyd Layered Complex (CLBC), Munda Gold and Spargoville Nickel Projects. CARR BOYD LAYERED COMPEX (CLBC), WA 100% The Company received laboratory assay results during the full year from the drilling success at the T5 EM target within the Carr Boyd Nickel Project (Table 1 and Figure 1). The T5 Target is located approximately 1,000-1,200m north-north-west of the Carr Boyd Nickel Mine and is interpreted to be a significant new zone of nickel-copper sulphides discovered away from the known historic mineralisation. Modelling of the geological and geophysical data is supportive of mineralisation extending to the north, south, and at depth. The Company completed two RC drill holes in late May 2019 (Figures 2 & 3) testing the T5 EM target which was previously identified by the Company in a ground Moving Loop Electro-Magnetic (MLEM) program2. Historic drilling2 ~400m further to the south, intersected disseminated and matrix sulphides on the interpreted basal contact of the western ultramafic unit, returning 3.35m at 0.79% Ni & 0.35% Cu which included a higher-grade zone of 0.61m grading 2.12% Ni & 0.56% Cu from 100.89m in drill hole GD124. The MLEM survey identified the T5 Target zone to the north of this historic drilling within an area untested by deeper drilling. Assay results returned from SGS Laboratories in Perth (Table 1) confirmed the presence and grade of the Ni-Cu sulphides intersected in the drilling. Both holes intersected the same basal contact as the historic drilling to the south, however the grades and width of the mineralisation in the Estrella holes are better than the historic drilling which are the most significant results returned to date from outside of the known Carr Boyd Mine area. Annual Report 2020 3 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Table 1: Significant Intersection Results above 0.4% Ni cut-off grade. Hole ID From To Width Ni% Cu% Co ppm CBP042 129m 137m 8m 1.11% 0.36% 507ppm Incl l 133m 137m 4m 1.60% 0.31% 689ppm 127m 1m 0.61% 0.57% 346ppm CBP043 126m Figure 1. Sulphide mineralised samples within CBP042 at Carr Boyd. Black samples are the higher grade, sulphide rich matrix zone. The host ultramafic sits against a primary basal contact (not sheared) and is underlain by a sequence of mafic basalts and felsic sediments to the west. The base of the ultramafic sequence comprises lowmagnesium ultramafics which have a weakly to highly disseminated sulphide zone developing from the base upwards. This is overlain by a geochemically different, second pulse of ultramafic comprising the higher-grade matrix sulphides at the base of a thicker, magnesium-rich (20-25% MgO) host ultramafic which develops eastwards. Annual Report 2020 4 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT DHTEM clearly defines that the drilling intersected the T5 MLTEM conductor. Modelling of the geochemical and geophysical data potentially indicates a strong target zone to the north as well as below the current and historic drilling. The modelling of the data is supportive of mineralisation opening up along the length of the basal contact to the north, as well as at depth below the drilling to the north & south. Deep diamond core drilling has been revised to target a zone 300m to the north and south of the current drilling and directly below T5 at a vertical target depth of 400-500m below surface. This planned drilling will be testing the basal contact over a greater strike length of ~700-800m providing critical geological and geochemical vectoring data. The drilling will also provide a platform for deep DHTEM geophysical testing for strengthening Ni-Cu sulphide mineralisation. The Company applied for Exploration Licence 31/1215 in May 2019 and the tenement was granted on the 28th January 2020, extending the Company’s 100% owned total area at the CBNP to 25,902 Ha (Figure 4). E31/1215 is located across the northern margin of the existing CBNP tenure, filling a gap up to and abutting the southern boundary of the Goongarie National Park to the north (Figure 4). Figure 2: Plan showing drill hole locations and interpreted geology from the logging. Annual Report 2020 5 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Figure 3: Cross-section with intersection results and interpreted geology in drill hole CBP042. Annual Report 2020 6 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Figure 4. Estrella's Carr Boyd Nickel Project tenure portfolio with the recently granted E 31/1215 located across the northern boundary (blue shaded). The Goongarrie National Park abuts to the north. Figure 5. Location of Carr Boyd relation to commercial centres and other major Ni projects. Annual Report 2020 7 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT New Nickel and Gold geochemical targets were generated from an auger drilling program (Figure 6). The targets were identified in the northwest portion of the Carr Boyd Nickel Project (CBNP or the Project). Figure 6. Auger sample sites (blue dots) across Estrella's Carr Boyd Nickel Projects NW tenure. The generated pathfinder Nickel (red) and Gold (yellow) vector target zones are shown over aeromagnetic image (TMI-RTP) along with previously identified prospects. The Company enlisted Gyro Australia to drill 536 shallow auger holes (plus 28 QAQC samples) using a low-impact Landcruiser mounted auger drill rig. Drilling comprised of shallow 0.5m-1.5m deep auger soil sample drill holes across the northwest tenements (M31/12, M31/109, E31/726 & E31/1215) at the CBNP (Figure 6). Drill spoil material was sieved to -2mm and a 150g-600g sample (ave. 270g) was collected and submitted to SGS Laboratories in Perth for multi-element geochemical analysis. Analysis comprised a 49 multi-element assay suite completed on the samples in order to evaluate the geochemistry using pathfinding vectors, particularly looking for nickel and gold target zones. The evaluation looked at the raw elemental assay results as well as combined key elemental associations in order to produce vector target maps over the sampling area (Figures 7 and 8). Two high priority Ni-Co-Cu targets were identified at the Central and POH Zones (Figure 6). These target zones include previously identified smaller prospects; however, the soil sampling has extended the target zones over a much larger area of approximately 2.5km x 1.2km (Figure 7), identifying contacts which have had limited historical work completed on them. The geochemical maps clearly demonstrate the fertility of the NNW trending Central Zone which includes the Scotia East Ni-Co zone and the announced sulphide discovery at the Target 5 (T5) Prospect (ASX: Nickel Copper Discovery at Carr Boyd Rocks- 28 May 2019; and Assay Results Confirm New Sulphide Nickel Discovery Zone at Carr Boyd Rocks- 8 July 2019). Annual Report 2020 8 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Ni-Co-Cu bearing sulphides were intersected in both drilled holes at T5 which comprised of disseminated to matrix sulphide mineralisation: o o 8m @ 1.11% Ni & 0.36% Cu returned from drill hole CBP042  Includes 4m @ 1.60% Ni & 0.31% Cu from matrix sulphide zone 1m @ 0.61% Ni & 0.57% Cu returned from drill hole CBP043 It was interpreted from the drill data that the mineralisation was developing towards the north and the results of the geochemical soil sampling supports this model, warranting further investigation along the length of this fertile ultramafic unit and its basal contact. A strong Cu associated anomaly was generated at the POH Zone (Figures 6 and 7) to the east of the Central Zone. Historic drilling has taken place at this prospect, however remodelling and reinterpretation of the data is warranted given the strength of the anomaly generated. New secondary targets have been generated at what has been named the Eastern, Western and Northern Zones (dashed rectangles), each showing Ni-Co and Cr association supporting fertile ultramafic relationships (Figure 6 and 7). Of interest is the highly anomalous new Eastern Zone which is open to the south of the auger sampling area. It is located directly over a magnetic high ultramafic unit (Figure 6) and does not have a historical prospect located in this area. Reassying of pulps testing for PGE elements within these target zones is now warranted. Further historical database and field investigation is also required to validate each of these target zones and determine the next phase of exploration works required i.e. infill/extensional auger soil sampling and/or deeper AC/RC drilling. Annual Report 2020 9 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Figure 7: Key elemental and pathfinder vector plots identifying Nickel associated target zones (red rectangles). Primary targets have solid outllines and secondary targets have dashed outlines. In addition to the Ni-Co-Cu targets, the geochemical vector analysis defined two parallel Gold pathfinder related trends over the Western greenstone sequence (Figure 8). The Au pathfinder targets are coincident with structural breaks in the aeromagnetics (Figure 6: yellow dashed line) supporting the potential for structurally controlled Au mineralisation to occur in the west of the project area. Reassying of pulps testing for Gold & PGE elements within these structural target zones is warranted. Further historical database and field investigations are required to validate each of these targets. Figure 8: Pathfinder vector plots identifying Gold associated target zones (orange ovals). Annual Report 2020 10 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT MUNDA GOLD PROJECT, WA 100% The Company undertook diamond core drilling at the 100% owned Munda Gold Project at Widgiemooltha, 34km south-west of Kambalda, WA during the full year 2019. Topdrive Drilling Australia (TDA) was contracted to complete 350-400m of HQ3 diamond core drilling to the immediate north of the historical Munda Gold Mine. Drilling was designed to target postulated high-grade gold shoots that had been 3D modelled by the Company using historical drilling completed by WMC, Titan Resources, Consolidated Minerals and Eureka (Figure 9). Partial mining of the open pit in 1999 by Resolute Gold Mines Limited occurred before mining ceased due to low gold prices. Evaluation of the historical RC drilling was inconclusive in determining the dominant structural direction required to confidently resource model the deposit for mining. However, 3D grade shell modelling of the gold data (Figure 10) provides a structurally controlled ladder vein/shoot model that required drill coring to collect orientated drill core for detailed structural and geological analysis. This has greatly assisted the Company in determining the orientation of the gold hosting vein system. Figure 9: Plan view showing the historical Munda Gold Pit (BLUE) with the planned drilling (RED) and targeted gold shoots (GREEN). Results exceeded the Company’s expectations, returning numerous very high-grade mineralised zones which contained “Bonanza” grades as shown in Table 3 and Figure 11. The high grade plunging shoot interpretation was a new concept, significantly different to interpretations undertaken by previous explorers. The new drilling reported during the year confirmed the high grade plunging shoot interpretation. This will have a significant impact on future drill targeting, allow an update to the JORC 2012 Mineral Resource, provide confidence in the 3D geological models, and allow robust economic evaluations to occur for the first time on the Project. Annual Report 2020 11 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Figure 10: Oblique section view showing the planned drill holes (RED) north of the Munda pit and target gold shoots (GREEN). Table 3: Significant Gold Intersections >1.0 g/t Au Hole ID EMD002 From (m) To (m) Width (m) Grade Au g/t 57.00 65.00 8.00 3.3 including EMD002 57.00 102.00 58.00 118.00 1.00 16.00 Comments 19.6 21.6 including 102.00 103.00 1.00 9.5 & including 107.00 116.00 9.00 35.9 107.00 108.00 1.00 234.7 109.45 109.70 0.30 24.6 111.50 111.75 0.25 53.4 113.00 116.00 3.00* 12.8 which includes EMD002 124.00 130.00 6.00* 2.0 EMD002 134.00 138.00 4.00* 4.4 EMD001 EMD001 75.00 84.10 77.00 91.00 2.00 6.90 9.3 4.8** EMD001 125.00 140.00 15.00 2.6 including 125.00 & including 135.00 126.00 136.00 1.00 15.7 3.00 3.8 EMD001 143.00 144.00 1.00 1.4 EMD001 149.00 150.10 1.10 1.7 Weathered and altered ultramafic above broken quartz vein zone from 64.5-67.0m Weathered & bleached ultramafic Weakly altered & quartz veined basalt below contact Thin quartz veinlets & weak alteration in basalt Quartz vein stockworks in weak-moderately altered basalt Chlorite altered basalt with minor quartz veinlets & quartz sweats Qtz-sulphide vein with high grade remobilised Ni sulphide blebs. 10cm wide quartz-chlorite vein in basalt Altered basalt with numerous cross-cutting quartz veinlets Minor quartz veinlets with weak alteration in coarse grained basalt-dolerite Minor quartz veinlets with weak alteration in coarse grained basalt-dolerite Altered and veined ultramafic Sheared & quartz veined zone in ultramafic. Silicified & altered basalt below ultramafic contact Quartz veined contact zone between units Narrow quartz veinlet in basalt with weak alteration Narrow quartz veinlets in basalt 10cm wide quartz-sulphide vein in basalt near EOH. * Two meter composite samples. Requires 1m resampling. ** Core loss occurred in the middle of the zone between 85.9m-88.9m through a shear zone (35% recovery). Recovered sample from this interval grades 3.647g/t Au and has been used as the average grade of the entire 3m interval Annual Report 2020 12 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Figure 11: Oblique cross-sections of EMD001 and EMD002 showing simplified geology and significant gold intersections. Annual Report 2020 13 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT SPARGOVILLE NICKEL RIGHTS PROJECT, 100% WA The Company reported to shareholders during the full year its maiden 5A nickel sulphide Mineral Resource at the Spargoville Nickel Rights Project, located approximately 30km south-west of Kambalda, Western Australia. The maiden Mineral Resource stands at 127,000 tonnes at 1.9% Ni and 0.15% Cu for a contained nickel metal inventory of 2,370 tonnes and is reported in compliance with the JORC Code (2012) as shown at Table 4. The Mineral Resource is shallow with the majority of nickel within 100m of surface and amendable to open pit mining. The maiden Mineral Resource followed a detailed assessment of historic drilling and the inclusion of significant high grade nickel sulphide drilling results achieved by the Company (see ASX release 18 December 2018) which included;  15m at 10.45% Ni, 0.78% Cu, 0.20% Co, 0.87g/t Pb, and 1.15g/t Pt from 20m  5m at 11.32% Ni, 0.54% Cu, 0.21% Co, 0.42g/t Pd, and 0.22g/t Pt from 61m  3m at 12.90% Ni, 1.37% Cu, 0.29% Co, 1.86g/t Pd, and 0.67g/t Pt from 69m Over 65% of the contained nickel tonnes in the 5A maiden Mineral Resource have been classified as Indicated with there being sufficient drill density and understanding of the mineralisation to satisfy this classification. The deposit is open at depth below the high grade nickel sulphide drill intercepts which allows potential for an increase in the current resource with further drilling. In light of the recent strength in the nickel market and the positive outlook, the Company has undertaken steps towards commercialisation of the 5A nickel sulphide Mineral Resource with discussions ongoing regarding the treatment of potential high grade nickel sulphide ore recovered from shallow open pit mining. The 5A nickel sulphide deposit is one of a number of significant nickel sulphide occurrences that make up the Company’s 100% owned Spargoville Nickel Rights Project which was purchased at a time when nickel projects were not in favour and nickel prices were much lower. Annual Report 2020 14 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Table 4: Spargoville 5A Nickel Sulphide JORC Resource 5A Nickel Sulphide Deposit October 2019 Mineral Resource Estimate - Min Type (0.5% Ni Cut-off) Type Disseminated Matrix/Breccia Semi-massive/Massive Total Type Disseminated Matrix/Breccia Semi-massive/Massive Total Type Disseminated Matrix/Breccia Semi-massive/Massive Total Tonnage kt 37 20 12 69 Indicated Mineral Resource Ni Cu Ni % % t 0.7 0.05 250 2.1 0.17 430 8.1 0.63 950 2.4 0.19 1,630 Tonnage kt 41 17 1 58 Inferred Mineral Resource Ni Cu Ni % % t 0.7 0.10 270 2.5 0.13 410 7.6 0.35 60 1.3 0.11 730 Tonnage kt 78 37 13 127 Total Mineral Resource Ni Cu Ni % % t 0.7 0.08 520 2.3 0.16 840 8.0 0.61 1,000 1.9 0.15 2,370 Cu t 20 30 70 130 Cu t 40 20 70 Cu t 60 60 80 190 Competent Person Statement The information in this announcement relating to Exploration Results for the Carr Boyd Layered Complex (CLBC) and the Munda Gold Project is based on information compiled by Mr. Neil Hutchison of Geolithic Geological Services, who is a consultant to Estrella Resources, and a member of The Australasian Institute of Geoscientists. The information in this announcement relating to the Spargoville 5A Mineral Resources is based on information compiled under supervision by Mr Shaun Searle of Ashmore Advisory Pty Ltd, who is a consultant to Estrella Resources, and a member of The Australasian Institute of Geoscientists. Mr Hutchison and Mr Searle both have sufficient experience relevant to the style of mineralisation and type of deposit under consideration, and to the activity they are undertaking to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resource and Ore Reserves”. Both Mr. Hutchison and Mr. Searle consent to the inclusion in the report of the matters based on the information in the form and context in which it appears. Annual Report 2020 15 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Significant changes in the state of affairs In the opinion of the Directors, other than the matters as outlined in the operations report above, or as set out in the accounts and notes thereto, there were no significant changes in the state of affairs of the Group during the financial year. Dividends In respect to the current year, no dividends were paid or declared during the period by the Group and no recommendation is made as to dividends. Corporate Governance Statement The Group has disclosed its corporate governance statement on the Company website at www.estrellaresources.com.au/investor-centre. Events subsequent to the reporting period On 6 July 2020 the Group entered into a Binding Letter of Offer with Auric Gold Limited to dispose of the Munda Gold Project for total consideration of $1,750,000 consisting of upfront and deferred cash payments. Settlement of the disposal is subject to several conditions precedent and is expected to occur during the September 2020 quarter. On 3 August 2020 the Company announced a Placement to raise $1,400,000 (before costs) through the issue of 200,000,000 ordinary shares at an issue price of $0.007 with one free attaching option for every one share subscribed exercisable at $0.02 expiring 31 July 2023. In addition the Company will complete an Option Placement through the issue of 200,000,000 options at an issue price of $0.0001 per option to raise $20,000, the options will be exercisable at $0.02 expiring 31 July 2023. On 7 August 2020, 75,000,000 ordinary shares were issued pursuant to the Placement, with the balance of the securities to be issued following shareholder approval. No other matters or circumstances since the end of the year have occurred that have significantly affected or may significantly affect the operations, the results of the operations or the state of affairs of the Entity in subsequent financial years. Likely future developments and expected results Further information, other than as disclosed this report, about likely developments in the operations of the Group and the expected results of those operations in future years has not been included in this report as disclosure of this information would be likely to result in unreasonable prejudice to the Group. Environmental issues The Group’s operations are subject to the laws and regulations pertaining to mining exploration operations in Australia. As at the date of this Report the Group has not been notified of any breach of any such laws or regulations. Annual Report 2020 16 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Information on Directors Mr Leslie Pereira– Non-Executive Director Date of appointment: 1 February 2019 Mr Pereira is a WA based businessman and investor in the resources sector. Mr Pereira has previously held senior management positions overseeing active mining operations in Indonesia. He has been actively involved in capital raisings and promotions of a number of publicly listed companies. Mr Pereira is not currently and has not been within the last three years a Director of any publicly listed Companies. Mr Pereira currently holds 300,000 fully paid ordinary shares, 4,995,769 quoted options and 3,000,000 unlisted options in Estrella Resources Limited. Mr John Kingswood – Non-Executive Director Date of appointment: 6 January 2017 Mr Kingswood has over 20 years’ mining experience with significant experience in mining and project management. Mr Kingswood has been involved with some of WA’s largest projects from BHP, RGP3, 5 and 6 Rio Tinto Argyle Diamond underground operations. Mr Kingswood has a strong track record of identifying potential projects and implementing effective strategies. Mr Kingswood is not currently and has not been within the last three years a Director of any publicly listed Companies. Mr Kingswood currently holds 1,410,000 fully paid ordinary shares, 4,500,000 unlisted options and 470,000 quoted options in Estrella Resources Limited. Mr Stephen Brockhurst – Non-Executive Director Date of appointment as Non-Executive Director: 3 April 2017 Mr Brockhurst is the founding Director of Mining Corporate Pty Ltd and has over 15 years’ experience in the finance and corporate advisory industry and has been responsible for the preparation of the due diligence process and prospectuses on a number of initial public offers. His experience includes corporate and capital structuring, corporate advisory and company secretarial services, capital raising, ASX and ASIC compliance requirements. Mr Brockhurst has served on the board and acted as Company Secretary for numerous ASX listed and private companies. He is currently a Director of Kingwest Resources Limited and Nelson Resources Limited and was previously a Director of Roto-Gro International Limited (resigned 5 February 2018) and International Goldfields Limited (resigned 5 January 2018). Mr Brockhurst currently holds 750,000 fully paid ordinary shares, 4,500,000 unlisted options and 250,001 quoted options in Estrella Resources Limited. Annual Report 2020 17 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Other Management Mr Christopher Daws: Chief Executive Officer Date of appointment: 2 January 2017 Mr Daws has strong experience in running junior resource companies having previously been involved with Niagara Mining (Poseidon), US Nickel and KMC Limited. Mr Daws is a Director and founder of Apollo Resources Pty Ltd and a Director of Nimbus Mines Pty Ltd. Mr Daws is responsible for running the dayto-day operations of the Group. Mr David McEntaggart: Company Secretary Date of appointment: 21 May 2018 Mr McEntaggart is a Chartered Accountant and Chartered Secretary with over 15 years’ experience in the resource industry and accounting profession in Australia and the UK. He provides services to a number of ASX listed companies specialising in financial accounting and corporate compliance. Meetings of the Board The number of meetings of Directors held during the year and the number of meetings attended by each Director were as follows: BOARD MEETINGS Director Number eligible to attend Number attended L Pereira 4 4 J Kingswood 4 4 S Brockhurst 4 4 The Company had the following options on issue as at the date of this report: Number of shares under option Class Exercise price Expiry date of options 5,500,000 Unquoted $0.05 15 May 2021 14,000,000 Unquoted $0.03 20 Nov 2022 250,980,328 Quoted $0.05 27 June 2021 Total 270,480,328 Shares issued during or since the end of the year as a result of exercise No shares have been issued during or since the end of the year as a result of exercise of an option. Annual Report 2020 18 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT Indemnifying officers or auditor During the reporting period, the Group paid an insurance premium to insure the Directors and Officers of the Group. The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought against the officers in their capacity as officers of the Group, and any other payments arising from liabilities incurred by the officers in connection with such proceedings, other than where such liabilities arise out of conduct involving a wilful breach of duty by the officers or the improper use by the officers of their position or of information to gain advantage for themselves or someone else to cause detriment to the Group. Details of the amount of the premium paid in respect of the insurance policies are not disclosed as such disclosure is prohibited under the terms of the contract. The Group has entered into agreements with each of the Directors and Officers to indemnify them against any claim and related expenses, which arise as a result of work completed in their respective capabilities. The Group has not otherwise, during or since the end of the financial year, except to the extent permitted by law, indemnified or agreed to indemnify any current or former officer or auditor of the Group against a liability incurred as such by an officer or auditor. Proceedings on behalf of Company No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Company or to intervene in any proceedings to which the Company is a party, for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. Non-audit services Details of the amounts paid to the auditors of the Group, RSM Australia Partners for non-audit services provided during the year are as follows: 2020 $ 2019 $ 3,155 - Non-audit services: Corporate Finance services - RSM Officers of the Group who are former partners of RSM Australia Partners There are no officers of the Group who are former partners of RSM Australia Partners. Auditor independence declaration A copy of the auditor’s independence declaration as required under s307C of the Corporations Act 2001 is included within this financial report and forms part of this Directors’ report. Annual Report 2020 19 ESTRELLA RESOURCES LIMITED AND CONTROLLED ENTITIES Re DIRECTORS’ REPORT REMUNERATION REPORT (Audited) The Directors of Estrella Resources Limited present the Remuneration Report prepared in accordance with the Corporations Act 2001 and the Corporations Regulations 2001. The Remuneration Report is set out under the following main headings: 1. Principles used to determine the nature and amount of remuneration 2. Details of remuneration 3. Service agreements Principles used to determine the nature and amount of remuneration The following Report outlines the principles used to determine the nature and amount of remuneration. The Board assumes the role of the Remuneration Committee and is responsible for reviewing and providing recommendations with respect to the remuneration packages of Directors and Key Management