P A N A U S T R A L I A N R E S O U R C E S L I M I T E D Pure Play Metals Conference GS-JBWere 30 th November 2006
Project Location Map S/E Asia Phu Bia Contr ac t Ar ea TRUONGSON CHIANG MAI TRUONGSON C H I A N G M A I BELT BELT BELT B E L T Mae Sot Sepon Sepon LOEI-PHETCHABUN/ L O E I - P H E T C H A B U N / LOUANGPHABANG BELT L O U A N G P H A B A N G B E L T Chatree Puthep Puthep Pr ojec t Pr ojec t L E GE ND Palaeozoic -Mesozoic volc ano sedimentar y belt - volc anic ar c s Ac id igneous r oc ks
Development Strategy � Phu Kham Phu Bia Gold Mine: Phase I Strategic greenfield “starter” project Op’s team, systems, infrastructure established � Phu Kham Phu Kham Copper-Gold Project: Phase II Brownfield development Leverage off gold mine – synergy benefits Fully financed June 2006 Owner operate mining late 2006 Production from mid-2008
Phu Kham Copper-Gold Project Project Fundamentals � Mine Life +12 years � Throughput Rate 12M tpa � Annual Concentrate 207,000dmt @ 25% Cu, 7g/t Au, 65g/t Ag � Annual Production 52,000t Cu, 47,000oz Au, 400,000oz Ag � Development Capital US$232m (Inc US$19m contingency) � Senior Debt / Equity ~51 / 49 � Mine Site Cash Cost* US¢ 40/lb � Total Cash Op Cost* US¢ 74/lb * After precious metal credits: US$450/oz gold and US$8.00/oz silver.
EPCM Contract • Ausenco conducted the Feasibility Study and have been awarded the EPCM contract. • Conventional crushing and grinding followed by flotation to produce a Cu/Au concentrate for sale to smelters. Ausenco have experience in the region with: • Chatree Gold Mine (Thailand) • Sepon Gold and Copper Mines (Laos) • Jinfeng Gold Mine (China)
Phu Kham Process Plant
Phu Kham Process Plant
Phu Kham Infrastructure
Phu Kham Development: November 2006…
Phu Kham Development: November 2006… ... on schedule, within budget
Phu Kham Development: November 2006… ... on schedule, within budget Transporting Haul Trucks to site
Phu Kham Development: November 2006… ... on schedule, within budget
... on schedule, within budget SAG Mill Castings Phu Kham Development October 2006
Phu Kham Project Layout
Phu Kham Development: November 2006… Tailings Storage Access Road Facility Plant Site Stage 1 Overland Campsite Conveyor Phu Kham South Pit Phu Kham North Pit ROM Pad and Crusher
Phu Kham Development: November 2006… ... on schedule, within budget
Community Development New School and Market Place in the local village
Phu Kham Funding Secured US$M � New equity 140 � Sempra Metals transactions 15 � Project Bank Debt Facility 140 � Total sources of funds 295 � Debt / equity ratio 51 / 49
Total Funding Envelope US$M � Estimated project capital costs 232.4 � Additional contingency (BDA rpt) 8.7 � Pre-commissioning costs 11.0 � Financing costs inc. cap interest 20.4 � Refinancing existing facilities 10.0 � Working capital 12.5 � Total uses of funds 295.0
Capital Expenditure Nov 2006 Phu Kham CuA U Project Com m itm ent Curves - Total Project 35,000,000 250,000 30,000,000 200,000 US$ Commitments (Monthly ) 25,000,000 150,000 20,000,000 15,000,000 100,000 10,000,000 50,000,0 5,000,000 - - 6 6 6 7 7 7 8 6 6 6 6 6 6 6 6 7 7 7 7 7 7 7 7 8 8 8 8 8 8 8 8 6 7 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - b r y l g p t v b r y l g p t v b r y l g p n r n u c n r n u c n r n u a c a c a p o p o p a e a u u e e a e a u u e e a e a u u e J O J O J M A M A M A F M N F M N F M J J A S D J J A S D J J A S Planned C ommitted Forecast Planned Committed Forecast
Change Management November 2006
Phu Kham Copper-Gold Ore Reserve Category Tonnes Cu Grade Au Grade Copper Metal Gold Metal (M oz) (Mt) (%) (g/t) (000 t) Proved 67 0.63 0.28 420 0.6 Probable 77 0.51 0.23 390 0.6 Total 144 0.56 0.25 810 1.2 Price assumptions: Copper US$1.35/lb, Gold US$450/oz, Silver US$8.00/oz • 85% of Measured & Indicated Resources convert to Ore Reserve • 9M t of Inferred Resources fall within final pit shell • Strip ratio exceptionally low at 0.57:1
Phu Kham Deposit Schematic Section
Phu Kham Plan View • In-fill drilling north mine area to start early 2007 • 45M tonnes of measured & indicated resource immediately below pit • 37M tonnes inferred resource beneath pit • 9M tonnes inferred resource in pit
Limited drilling below current pit +1% copper Cross Sections in floor of final pit
Cash Operating Costs Copper Copper mi mine cost ne cost cur curve, e, 2009 2009 Scenario 2 200 2nd Quartile 1st Quartile Assumptions: 8th Decile 9th Decile Copper price: US$1.00/lb Business operating cost (c/lb Cu) 150 Gold price:US430/oz Silver price:US$6.50/oz Molybdenum oxide price:US$4.56/lb TC:US$55/dmt RC:US5.5/lb 100 Production:52,312t contained Cu Business operating cost: US$0.659/lb 50 Phu Kham 0 0 2000 4000 6000 8000 10000 12000 -50 Cumulative production (000t)
Competitive on Capital Intensity Mine & Mill 8000 Industry Average 7000 ~US$5,500/t Cu Equiv in 2003 Dollars Capital Intensity US$/t Cu Equiv 6000 5000 Phu Kham 2006 Dollars 2003 Dollars ~US$3,900/t in 2006 4000 CPI adjusted Dollars 3000 ~US$3,700/t in 2003 2000 Dollars CPI Adjusted 2003 Dollars cost inflation adjusted ~US$2,700/t in 2003 1000 Dollars Mine Cost 0 Inflation Adjusted 1985 1990 1995 2000 2005 2010
Phu Kham Copper-Gold Economics Annual Cash Flow Sensitivity adopting 12Mtpa inputs Cu Price Au Price Annual Capital Cash Flow Payback US$1.35/lb 1 US$450/oz US$50M <5 yrs US$1.75/lb 2 US$500/oz US$75M <4 yrs US$2.25/lb 3 US$550/oz US$108M <3 yrs Silver price assumption US$8.00/oz all scenarios 1 Assumes a diesel price of 45¢/l to correlate with lower commodity price scenario 2 Assumes a diesel price of 60¢/l to correlate with middle commodity price scenario 3 Assumes a diesel price of 70¢/l to correlate with current commodity price scenario
Concentrate Transport Kunming 1415km 525km to 590km Rayong 970km Vietnam Ports By road: • • •
BHP Billiton & Sempra � BHP Billiton – manager of all concentrate sales � Exposure to global market presence and expertise � Optionality on benchmark or spot sales � Sempra – guaranteed offtake for 50% of production � US$5M placement at $0.55 per share – 20% premium � US$10M debt facility on very competitive terms
Disclaimer This presentation has been prepared by the management of Pan Australian Resources Limited (the 'Company') for the benefit of brokers, analysts and investors and not as specific advice to any particular party or person. The information is based on publicly available information, internally developed data and other sources. No independent verification of those sources has been undertaken and where any opinion is expressed in this document it is based on the assumptions and limitations mentioned herein and is an expression of present opinion only. No warranties or representations can be made as to the origin, validity, accuracy, completeness, currency or reliability of the information. The Company disclaims and excludes all liability (to the extent permitted by law), for losses, claims, damages, demands, costs and expenses of whatever nature arising in any way out of or in connection with the information, its accuracy, completeness or by reason of reliance by any person on any of it. Where the Company expresses or implies an expectation or belief as to the success of future exploration and the economic viability of future project evaluations, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, such forecasts are subject to risks, uncertainties and other factors which could cause actual results to differ materially from future results expressed, projected or implied by such forecasts. Such risks include, but are not limited to, exploration success, gold and copper price volatility, changes to the current mineral resource estimates, changes to assumptions for capital and operating costs as well as political and operational risks and governmental regulation outcomes. For a more detailed discussion of risks and other factors, refer to the Directors' Report in the Company's 2005 Annual Report which has been lodged with the Australian Stock Exchange, as well as the Company's other Australian Stock Exchange announcements and filings. The Company does not have any obligation to advise any person if it becomes aware of any inaccuracy in or omission from any forecast or to update such forecast.
P A N A U S T R A L I A N R E S O U R C E S LIMITED Simon Milroy Manager Technical Services Website: www.panaustralian.com.au Email: info@panaustralian.com.au
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