In today's AustralianPanAust (PNA) Credit Suisse Outperform...

In today's Australian

PanAust (PNA) Credit Suisse Outperform recommendation 12-month target price of $1.50 Last traded at 79c PANAUST has delivered a maiden resource for its Ban Houayxai deposit in Laos of 19 million tonnes at 1.7 grams per tonne of gold and 10 grams per tonne of silver. The asset is subject to a pre-feasibility study, which is due for completion in the current quarter.

PNA is looking to build a reserve to support a 100,000 ounce per annum gold operation with first production in 2011.

"Further resources will be needed, in our view, to commit to a project at Ban Houayxai. There is significant potential at depth, with wide and good tenor mineralisation appearing to persist at depth. The deposit, were it to progress to a project, would afford low strip ratios, good recoveries and low powder factors in drill and blast," Credit Suisse said in a note to clients.

The analysts said the asset, while a modest grade, had many advantages, including cheap power, installed infrastructure, low strip ratios and good recoveries.

It is expected further drilling is likely to increase resources, given that the asset is open to the north and at depth.

"In common with ASX-listed copper peer EQN we think PNA is outstandingly inexpensive," Credit Suisse said.



http://www.theaustralian.news.com.au/story/0,25197,24233597-5005200,00.html