gold bouncing higher on greenspan remarks, page-4

to become producer this month by pouring first gol Laos-focused gold explorer Pan Australian Resources (PNA.AU) says
on track to become producer this month by pouring first gold at Phu Bia mine, after
6-week procurement delays. Confirms plans to ramp up to 2 million tons by December 2005
from previously planned third year ramp up. Aims to become mid-tier player by late 2007
with copper-gold second phase, but US$165 million estimated capex offers sizable barrier.
Market likely to pay close attention to phase II feasibility due out late August.


-Laos-focused gold explorer Pan Australian Resources Ltd. (PNA.AU)
says it is on track to become a producer this month, and within two years, join
compatriot Oxiana Ltd. (OXR.AU) as a mid-tier player.
After a six-week delay due to procurement problems, the company's Phu Bia gold
mine in Laos is set to pour first gold later this month, said Corporate Development
Manager Joe Walsh, without offering a date.
Mine development, including the commissioning process, is progressing well and within
budget, Walsh said.
"In this environment, where mining equipment is difficult to get hold of, a
six-week slippage is a very credible outcome," he told Dow Jones Newswires. "It
was always quite an aggressive program to bring mine into production by late April."

Following the first pour, Phu Bia is expected to ramp up to 1.5 million metric tons a
year by the end of August.
A recently announced plan to shorten the path to full capacity of 2 million tons from
the third year to December 2005 is still being "proactively looked at."
"I'd be surprised if we didn't commit to that," Walsh said.
"It should give us a bit more economies of scale upfront (and) better upfront
cash-flow than our feasibility study expectations, as well as better returns."



Investors To Eye Copper-Gold Developments

If all goes to plan, Pan Australian's share price is likely to stay on the front
foot after climbing around 8% in the last month. But the real investor interest lies in
the company's ability to develop the Phu Kham copper-gold deposit, which lies under
the Phu Bia oxide gold cap.
The feasibility study of the 9 million-ton-per-year project is due for release late
August. A positive outcome is set to kick off a search for financing late this year,
development in early 2006 and production in mid-to-late 2007.
According to a preliminary study, Phu Kham could produce 57,000 tons of copper and
52,000 ounces of gold in concentrate a year at a capital cost of US$140 million-to-US$165
million.
That would bring the Laos operation's total gold output to in excess of 100,000
ounces a year compared to forecast output of 220,000 ounces at Oxiana's Sepon gold
and copper project, also in Laos. Copper output levels at the two mines would be similar.

"It will take us firmly into the mid-tier producer bracket," Walsh said,
adding that the high capital expenditure requirements are within Pan Australian's
reach.
"Given our view of Phu Kam as a quality project, we believe we have the capacity
to finance it," he said. "(And) by the end of this month we're going to be
a mining company rather than exploration and development company, which changes our
status quite significantly."
Pan Australian has managed to equity finance Phu Bia's A$15.3 million development
costs and feasibility work on the copper-gold project "rather than committing to
third party early on and giving away some of potential value."
But the company is likely to look at a combination of debt and equity for Phu
Kam's development, he said, without ruling out a joint venture arrangement.
"Once we complete feasibility we'll certainly be weighing up all and any
means available to finance the project."