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land access approved for the puthep project in tha ASX ANNOUNCEMENT
14 November 2006
Puthep Project, Thailand
Land access approved for the Puthep Project in Thailand
Feasibility Study to include evaluation of primary copper-gold
The joint venture for the Puthep Project has received Thai government approval for land
access and its field program for a feasibility study on the PUT 1 deposit near the major
provincial centres of Loei and Udon Thani in north-east Thailand. The Project is located
within a day’s drive of Pan Australian’s Vientiane office base and Phu Bia Contract Area in
Laos (Figure 1).
Key Points
Pan Australian completed a pre-feasibility study on the near-surface oxide-transitional copper
mineralisation at the PUT 1 and the PUT 2 deposits in 2001 when the prevailing copper price
averaged US$0.70/lb. This study focused on producing up to 30,000 tonnes of copper per
annum over a 7-year mine life through heap leaching and solvent extraction electrowinning of
the transitional chalcocite mineralisation. The study identified transitional mineral resources
of:
• PUT 1 deposit (Indicated and Inferred):
85 million tonnes at 0.4% copper
• PUT 2 deposit (Inferred):
36 million tonnes at 0.4% copper
Earlier drilling at the PUT 1 deposit by previous joint ventures had intersected broad zones of
primary mineralisation below the transitional resource for combined transitional/primary
intercepts of:
• 240m at 0.6% copper and 0.2g/t gold from 3m; including
10m at 1.6% copper and 0.5g/t gold from 105m, and
23m at 2.1% copper and 0.7g/t gold from 138m
• 145m at 0.47% copper and 0.16g/t gold from 3m; including
18m at 0.92% copper, 0.30g/t gold from 57m, and
18m at 1.25% copper, 0.39g/t gold, 7 g/t silver and 11.2% zinc from 108m
A review of this data, coupled with Pan Australian’s experience at the Phu Kham Copper-Gold
Project in Laos, support the evaluation of a much bigger open-pit and flotation operation on the
transitional and primary mineralisation to produce a copper concentrate for custom smelting
with gold and silver by-products.
The feasibility study will focus on the PUT 1 deposit and will commence in early 2007 with
completion likely in late 2008. Pan Australian has rights to acquire a total 60% interest in the
Project from Padaeng Industry Public Company Limited.
Background
The Puthep Project comprises two copper-gold deposits PUT 1 and PUT 2 located 12km apart
(Figure 2). Pan Australian has previously reported JORC compliant resource estimates for the
oxide-transitional copper mineralisation in both deposits (refer to 2005 Annual Report). These
estimates were confined to estimates of the shallow chalcocite copper mineralisation to be
consistent with a pre-feasibility study completed when the price of copper was US$0.80/lb and
which focused on recovering copper through heap leaching and then solvent extraction
electrowinning:
• PUT 1 oxide-transitional Indicated and Inferred Mineral Resource of
85 million tonnes at 0.4% copper (based on drill hole spacing of 100 x 100m); and
• PUT 2 oxide-transitional Inferred Mineral Resource of
36 million tonnes at 0.4% copper (based on drill hole spacing of 200 x 150m).
The oxide-transitional blankets of mineralisation at both deposits average 30m in thickness
and overlay primary chalcopyrite copper mineralisation. Chalcopyrite copper and gold can
not be recovered through copper heap leaching and therefore the primary copper
mineralisation and gold intercepts were not previously evaluated for their resource
potential.
A previous joint venture conducted tests that indicated a positive response by oxidetransitional
and primary copper mineralisation to recovery by flotation. That joint venture also
tested the primary mineralisation and intercepted very shallow oxide and primary copper-goldsilver
mineralisation of significant grade and over considerable widths with peak intercepts
grading over 2% copper (Cu), 2g/t gold (Au) and 10g/t silver (Ag). In addition, 18m at 11.2%
zinc (Zn) was recorded in hole PHF50.
These metallurgical and drill results indicate the significant potential to substantially increase
the size of the resource at both deposits with further drill evaluation and flotation metallurgical
test work on the oxide-transitional and primary mineralisation. Best intercepts at PUT 1
include:
Total oxide-transitional (to an average depth of 25m) and primary intercept
Hole
No.
Interval
(m)
Width
(m)
Cu
(%)
Au
(g/t)
Peak intercept
PHF14 6-129 123 0.51 0.10 12m at 1.29%Cu and 0.40g/tAu from 39m
PHF26 3-243 240 0.62 0.20 10m at 1.60%Cu and 0.51g/tAu from 105m; and
23m at 2.09%Cu, 0.66g/tAu and 6g/tAg from 146m
PHF43 0-250 250 0.35 0.12 27m at 1.00%Cu and 0.24g/tAu from 214m
PHF50 3-148 145 0.47 0.16 18m at 0.92%Cu, 0.30g/tAu from 57m; and 18m at
1.25%Cu, 0.39g/tAu, 7g/t Ag and 11.2%Zn from 108m
PHF58 54-96 42 0.69 0.86 15m at 1.69%Cu, 2.20g/tAu and 10g/t Ag from 81m
P1R37 0-75 75 1.01 N.B. Not assayed for gold
Over 19,000 metres and 5,000 metres of diamond core and reverse circulation drilling has
been completed at the PUT 1 and PUT 2 deposits respectively by Padaeng Industry and a joint
venture between Phelps Dodge and Padaeng Industry.
The PUT 1 deposit was the subject of a pre-feasibility study completed in 2001 with an
assumed copper price of US$0.90/lb copper and total cash operating costs were estimated at
US$0.50/lb copper. This study identified the potential for developing a low strip ratio mine
with a 7 million tonnes per annum ore mining and processing rate with ore grading 0.5%
copper to produce up to 30,000 tonnes of copper per annum over a 7-year mine life with
additional potential to add to the mine life through the evaluation of the PUT 2 deposit.
Although operating cost inputs have increased since 2001, the price of copper has increased by
a greater margin and it is anticipated that a review of the pre-feasibility study adopting total
cash operating costs typical of a copper flotation plant will confirm the potential of the PUT 1
deposit to support a viable mining operation subject to completion of further resource drilling,
metallurgical test work and a feasibility study.
The PUT 1 deposit is located adjacent to a major sealed arterial road with easy access to the
Thai capital Bangkok and the major service centre of Loei (Figure 2). Power supply and water
are located close to the Project area.
Ownership
Pan Australian will earn a 51% interest in the Project from Padaeng Industry Public Company
Limited through sole funding a feasibility study and has a right to acquire a total 60% interest
consistent with the provisions for Australian ownership under the Free Trade Agreement
between Australia and Thailand. The feasibility study is scheduled to commence in early
2007 with completion likely in late 2008.
For further information contact:
Mr Gary Stafford Mr Joe Walsh
Managing Director General Manager – Corporate Development
Pan Australian Resources Limited
Tel: (07) 3846 1811 Website: www.panaustralian.com.au
Email: [email protected]
The data in this report that relates to Exploration Results are based on information evaluated by Dr. Ralph Child
who is a Fellow of The Australasian Institute of Mining and Metallurgy (FAusIMM) and who has sufficient
experience relevant to the style of mineralisation and type of deposit under consideration and to the activity
which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian
Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the “JORC Code”). Dr. Ralph
Child is a full-time employee of Pan Australian Resources Limited and he consents to the inclusion in the report
of the Exploration Results in the form and context in which they appear.
Figure 1 Project location plan
Figure 2 Puthep location relative to developed infrastructure
Figure 3 Schematic plan view depicting Puthep geology
Figure 4 Schematic section depicting Puthep geology