announcement., page-3

** all aboard the pna express ** Gary Stafford's interview with corporatefile.com.au is a terrific summary of the current state of play. Clearly, the market has not understood the assets (currently valued at over US$4.4 Billion) and the upside potential. Nor has the market understood the hurdles that have been overcome and the exciting Return on Investment, Cashflow and Profitability that will be achieved by controlling the cost of operations.

I have summarised the 7 page interview below...

1. PNA holds three projects - all have recently made significant advances

2. Following the placement, there will be 630 million shares and 28 million options on issue, a market capital of $100 Million (based on a share price of 16c), a cash balance of $35 Million and No debt

3. Company-wide resources (currently) around 3 Billion pounds of copper and 1.5 Million oz of gold [SCD: which at todays prices values the assets at US$4.5 Billion]

4. Phu Kham Copper Gold project is the major asset with a Bankable Feasibility Study in progress

5. Phu Bia Gold Project is the first project and the smallest of the 3 projects - comprising 3 deposits

6. The oxide mineral resource of Phu Bia is 11.8 million tonnes at 1 g/t for 400,000 oz PLUS a primary sulphide ore component of 160,000 oz. The primary resourcve will be evaluated as a separate development [SCD: CIL Plant] from the oxide resource

7. PNA has just completed a resource extension drilling program at one of the Phu Bia deposits and will announce an resource upgrade soon.

8. Puthep Copper Project in Thailand has an Indicated and Inferred Mineral Resource of 520,000 tonnes of copper or just over 1 Billion pounds

9. The most immediate task is to complete the detailed design and construction of the Phu Bia Gold Project. Awarding contracts shortly and everything moving along well. Already started pre-development site works including building the camp and roads. Constructing the heal leap pads and process plant in October 2004. On tartget for first pour in March 2005 [SCD: just 6 months away]

10. Feasibility Study for the Phu Kham Copper-Gold Project is scheduled for completion by August 2005

11. Currently reviewing a pre-feasibility study at Puthep Copper Project. Study indicated a resource capable of producign 25,000 tpa of copper cathode over seven years using SWEW process

12. Phu Bia Gold Feasibility study was based on a gold price of US$375oz and excnahge rate of 0.75 the Phu bia Gold project generates a internal rate of return of 36%. The internal rate of return is very robust even at a gold price well below current levels. [SCD: A$500oz versus todays rate of A$580oz or 16 discount to todays gold price]

13. Phu Bia initial throughput of 1.5mtpa will increase to 2mtps after year two. Initial grades of 1.7 g/t with cash operating costs of US$185oz. Capex is US$15.3 million.

14. PNA is also working with a group of three banks to agree a term sheet for a US$10 million debt facility. The rationale for doing the equity raising was to ensure the Phu Bia plant was built before the onset of the wet season next year. The finalising of the debt financiing would have delayed this key milestone.

15. Several major institutions will take shares in the placement. Institutional representation on the share register will equal 20 per cent. Many are new shareholders.

16. A preliminary study of the Phu Kham Copper-Gold project confirmed a viable operation based at rates of 9 mtpa and 12.5 mtpa. Capital costs range bewteen US$140-165 million and cash operating costs between 0.46c-0.60c per pound depending on the throughput operation - 9 mtpa or 12.5 mtpa. Expected mine life is more than 10 years.

17. MDM Pty Ltd assessed the metallurgical and processing characteristics and the test went like a dream. The ore floats really well and it was very easy to produce a saleable copper-gold concentrate.

18. In independent statistical assessment of five hole twinning program by Hellman and Schofield concluded there was 15-40% more copper metal intersected than by the previous JV

19. Ore has a very low grinding index and soft ore will lead to lower power consumption and capital costs.

20. Mining of a number of high grade areas will substantially enhance project economics.

21. A review of industry studies indicates that Phu Kham Copper-Gold project will be right at the lower end on a capital per tonne of capacity basis. That is something that I don't think has really registered with the market. We don't believe they realise how do-able Phu Kham is.

22. A new mineral resource estimate will be produced for Phu Kham Copper-Gold project at the end of this month based on a 500m x 500m area. PNA will then drill the full strike length of the deposit to produce a revised Indicated resource early in 2005.

23. Phu Bia Gold project comprise 3 deposits - Phu Kham Gold Cap, Long Chieng Track and Ban Houayxai. LCT and BH currently only make a small contribution to the gold oxide project. The fulloxide component remains to be tested. BH is a big system with a strike length over 1 km [SCD: only 20% has been drilled] and only to adepth of 60 metres and many holes finished in mineralisation

24. Puthep Cooper Project comprises PUT1 deposit and PUT2 deposit. So date, only looked at PUT1. PUT2 enable us to increade the overall resource size.

25. PNA holds over 2600 sq km in Laos, by far the largest contrat area held by any company. Engaged an exploration geologist to pull together specific exploration programs. Already, it is clear there are some really attractive targets.

26. There do not appear to be any major hurdles for ther Phu Bia Gold Project. We have design a project that takes into account the rainfall - the levels are similar to those in northern Queensland and therefore manageable. Funding is usually the main hurdle but we are now well advanced with that. We still need govenment approval but Oxiana is a good examplee of how the Lao Govt encourages development.

27. Funding is the main hurdle for Phu Kham Copper-Gold project however, we are taking the right approach by raising some equity now, organising a debt facility and developing the smaller gold project first to provide cash flow. As we move to become a significant copper-gold producer the market will re-rate PNA stock making funding more straight-forward.

28. We overcame one of the biggest hurdles at Puthep Copper project after the Thai Govt gave an in-principle approval for mining. That was a great leap forward.

29. Although the resource base is significant, the grades for each project are modest. Does that make the project economics particularly sensitive to commodity price movements?

At Phu Bia Gold Project we have been able to drive our cost structure down becuase: -

a) ore is free dig (no drill or blasting)
b) using a very light crushing technique
c) strip ratio is low and most higher grade gold is close to the surface

At Phu Kham copper-gold project the deposit is not low. Plus, we have the tremendous advantage of very low stripping ratio and capital cost.

PLEASE SEE MY POST YESTERDAY ON OZESTOCK FOR THE UPCOMING EVENTS THAT WILL INFLUENCE THE SHARE PRICE IN THE NEAR TERM