PANAUST'S PHU KHAM MINE BOOSTS PRODUCTION

Written on the 17 March 2010

PANAUST'S PHU KHAM MINE BOOSTS PRODUCTION

PANAUST Limited (PNA) has a market capitalisation of more than a quarter of the annual GDP in the country where it operates, but with strong commodity prices and production the Brisbane-based company is set to keep on growing this year.

Managing director Gary Stafford (pictured) says production at PanAust’s Phu Kham mine in Lao PDR is on track to boost copper production by more than 11 per cent this financial year.

“Our forecast for 2010 is to produce between 60,000 tonnes and 63,000 tonnes, which is significantly more than the 54,000 of copper we produced in 2009,” says Stafford.

“It always takes time to get to capacity when you start a new mine, but at Phu Kham we’ve been at capacity for the last three or four months.

“In revenue terms, at $3 a pound we expect an EBITDA at $224 million – we’re looking at about $400 million of revenue from copper and on top of that over 43,000 ounces of gold, so at $1000 an ounce that’s another $43 million.”

In the company’s profit guidance it included a conservative possibility that the copper price could fall to $2.50 a pound, but Stafford believes it could even go as high as $3.50.

PanAust shot through the rankings from 21st position in last year’s edition of Brisbane’s Top Public Companies, but Stafford says the move represents a return to stability.

“Our market capitalisation has bounced quite a lot in the last 18 months – in the middle of 2008 we were at around $1 billion but after the GFC we went to below $200 million, but this year we’re back above $1.3 billion,” he says.

“Much of that has been following the price of copper, however in the last few months there have been some concerns of a double dip in the economy, but what we’re seeing in our business is very good demand for copper coming from the smelters.

“We’re returning to consistency with cost of inputs, a level of consistency not seen for six to nine months.”

Stafford plans to start one or two more growth projects this year and bring more debt into the company to help fund projects in Lao.

“The two projects we’re currently reviewing in Lao are the expansion of Phu Kham and also a gold-silver deposit in Ban Houaiyxai.”

PanAust employs 1700 staff in Lao and Stafford says the government has a small bureaucracy which is efficient to work with.

“We also embarked on a training program for Lao people and we’ve had a number of graduates over the last 12 months - we’re very proud of that,” he says.

PNA also has an office in Thailand where it organises the export of gold and copper offshore.

PanAust recently announced a majority takeover bid for Chile’s Inca de Oro Copper-Gold Project, a subsidiary of the world’s biggest copper producer Codelco.

This year Panaust rose two places to secure the number 10 position on Brisbane Business News top public companies list. Read the full list by getting your copy of the March edition now - available in more than 500 greater Brisbane newsagencies.


Latest News

CROWN EMPLOYEES CONVICTED, JASON O'CONNOR TO SPEND 10 MONTHS IN JAIL

CROWN Resorts (ASX: CWN) employees who were arrested in October last year on suspicion of gambling offences have b...

QUICK TURNAROUND FOR $20 MILLION OFFICE IN MELBOURNE OUTER-EAST

AN office building in Melbourne's outer eastern suburb of Mount Waverley has sold for $20.5 million just two year...

METCASH NET PROFIT FALLS 20 PER CENT, ANNOUNCES CEO WILL STEP DOWN IN 2018

FOOD and grocery giant Metcash has announced its full year net profit has fallen more than 20 per cent and its CEO Ia...

SHARE PRICE PLUNGE FOR RETIREMENT VILLAGE OPERATOR AHEAD OF FOUR CORNERS INVESTIGATION

A RETIREMENT village operator which has been accused of charging excessive fees through complex contracts has respond...

Related News

METCASH NET PROFIT FALLS 20 PER CENT, ANNOUNCES CEO WILL STEP DOWN IN 2018

FOOD and grocery giant Metcash has announced its full year net profit has fallen more than 20 per cent and its CEO Ia...

SHARE PRICE PLUNGE FOR RETIREMENT VILLAGE OPERATOR AHEAD OF FOUR CORNERS INVESTIGATION

A RETIREMENT village operator which has been accused of charging excessive fees through complex contracts has respond...

CHINESE TECH FIRM LOOKS TO AUSTRALIA FOR 'CUTTING EDGE' IDEAS

CHINESE ed-tech company Retech Technologies (ASX: RTE) has listed on the ASX after raising $17.9 million from its IPO...

COLLINS FOODS GOBBLES UP MORE AUSSIE KFC STORES

COLLINS Foods Limited (ASX: CKF) has purchased 28 KFC restaurants from Yum! Brands Inc for $110.2 million, adding fur...

BOOK YOUR FUNCTION SPACE HERE

 

 

 

Contact us

Email News Update Sign Up Contact Details
Subscriptions

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter