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Quarterly Report
for the three months ending 31 March 2007

Phu Kham Copper-Gold Project

• The projected date for initial concentrate production is running ahead of the scheduled
mid-2008 start-up date. The project remains within the $241 million capital budget.

• All foundry work on the mills and crusher was completed in early April and delivery of
the mills to site is on schedule for September quarter this year.

• Waste mining for the Phu Kham copper-gold mine Stage 1 pit started in the quarter
following the integration of mining activities with those for the Phu Bia Gold Mine.

Phu Bia Gold Mine

• A gold production record of 10,510 ounces was achieved in the March 2007 quarter. In
February a major milestone was achieved when the cumulative production of gold passed
the one tonne mark.

• Cash operating costs for the quarter were US$399/oz and provided an operating margin of
US$256/oz on gold sales of 11,146oz.
Puthep Feasibility Study

• Drilling started at the Puthep Copper Project in Thailand in March, marking the start of the
feasibility study.

Exploration

• Further drilling at Ban Houayxai extended down-dip the previously identified broad zone
of stockwork gold-silver mineralisation with the best interval being:

36 metres at 3.2g/t gold equivalent from 54 metres, including - 10 metres at a gold equivalent grade of 10.6g/t (10.3g/t gold and 13.4g/t silver)
from a depth of 54 metres.

• Highly anomalous copper values were returned in channel samples taken from within the
large, four kilometre by two kilometre, Pha Nai anomaly.
Corporate

• A revised tax and royalty regime for the Phu Bia Contract Area was finalised in April and
Pan Australian’s rights to retain an area of 2,637km2 for at least 30 years were confirmed.

• At 31 March, Pan Australian had cash of US$53 million and no debt.