Chile – Inca de Oro

Inca de Oro is a porphyry copper-gold deposit and is located near the town of Inca de Oro in the province of Chañaral, Region III of Atacama in Chile. The Project benefits from existing infrastructure such as roads, rail, power and smelters.

PanAust is managing the feasibility study for the Inca de Oro Copper-Gold Project. The study is scheduled for completion during the June quarter 2012 for consideration by the Boards of the joint venture and PanAust during the September quarter 2012.

The Inca de Oro pre-feasibility study, completed by Codelco, indicated the potential for a conventional open pit mining and flotation operation, and annual production averaging approximately 50,000 tonnes of copper and 40,000 ounces of gold in concentrate during a plus 10-year mine life.

Study work to date indicates that higher grade supergene mineralisation may support elevated copper production during the first few years of any mine development before grades and consequent copper production declines. The development concept contemplates the deferred processing of oxide mineralisation, mined and stockpiled during the pre-strip, through a heap leach and SX-EW operation to produce copper cathode that will offset the decline in copper in concentrate production.

Subject to a successful feasibility study, a possible two-year construction program would see initial production at Inca de Oro commence in the second half of 2014.

This joint venture with Codelco provides PanAust with geographic diversity and a base for growing the business in South America; the world’s most prolific copper-producing region.

PanAust holds a 59.4 per cent beneficial interest in Inca de Oro S.A., the owner of the Inca de Oro Copper-Gold Project, through a 90 per cent interest in PanAust Minera, which holds a 66 per cent interest in Inca de Oro S.A. Codelco holds the remaining 34 per cent interest.