Roll over icons to start

P + 0

ANNUAL REPORT 2010

Skip Navigation Links
Home
Overview
Management Discussion and Analysis
Sustainable Development
Corporate Governance Statement
Directors' Report
Financial Report
Additional Information
List of Abbreviations
Shareholder Reporting Timetable
Corporate Directory
Skip Navigation LinksFinancial Report > Notes to the Consolidated Financial Statements > Note 16. Intangible Assets

note 16. intangible assets

(a) Reconciliation of carrying amount at the beginning and end of the period

CONSOLIDATED
2010
US$M
2009
US$M
At 1 July - Net of accumulated amortisation25.616.6
Additions – Kayelekera Mining Lease-10
Amortisation(1.0)(1.0)
At 30 June - Net of accumulated amortisation24.625.6
At 30 June
Cost 27.827.8
Accumulated amortisation(3.2)(2.2)
Net carrying amount of non current intangible assets24.625.6

Amortisation of US$1.0M (2009: US$1.0M) is included in costs of sales in the Income Statement.

(b) Movements in intangible assets

Movements in each group of intangible asset during the financial year are set out below:

Right to Supply of Power
US$M
Right to Supply of Water
US$M
Kayelekera Mining Lease
US$M
Total
US$M
Consolidated - 2010
Carrying amount at 1 July 20094.511.110.025.6
Amortisation expense(0.2)(0.8)-(1.0)
Carrying amount at 30 June 20104.310.310.024.6
Consolidated - 2009
Carrying amount at 1 July 20084.711.9-16.6
Additions--10.010.0
Amortisation expense(0.2)(0.8)-(1.0)
Carrying amount at 30 June 20094.511.110.025.6

(c) Description of the Group’s intangible assets

(i) Right to supply of power

LHUPL has entered into a contract with NamPower in Namibia for the right to access power at LHM. In order to obtain this right, the power line connection to the mine was funded by LHM. However, ownership of the power line rests with NamPower. The amount funded is being amortised over a period of 13.75 years on a straight-line basis.

(ii) Right to supply of water

LHUPL has entered into a contract with NamWater in Namibia for the right to access water at LHM. In order to obtain this right, the water pipeline connection to the mine was funded by LHM. However, ownership of the pipeline rests with NamWater. The amount funded is being amortised over a period of 13.75 years on a straight-line basis.

(iii) Kayelekera Mining Lease

In exchange for the Mining Lease, Paladin Energy Minerals NL and PAL have entered into a Development Agreement with the Government of Malawi for the development of the Garnet Halliday Karonga Water Supply Project and other social development projects. In terms of the Development Agreement PAL has committed to spend US$10M on agreed community infrastructure projects. This amount has been recognised as an intangible asset and is being amortised over the life of the mine estimated to be 9 years on a straight-line basis (refer to Note 19(b)(iv)).