Australia-based copper-gold producer PanAust recommended on May 8 that its shareholders accept an all-cash offer of A$1.85/share from Guangdong Rising Assets Management for PanAust shares that Guangdong Rising did not already own. The offer valued PanAust at about A$1.2 billion. Guangdong Rising already held a 24.26% interest in PanAust. Guangdong Rising is owned by the government of China’s Guangdong province.
PanAust produces copper and gold at its Phu Kham and Ban Houayxai mines in northern Laos and has pre-development projects in Laos, Papua New Guinea, and Chile. In 2014, the Phu Kham mine produced 71,155 mt of copper, 67,817 oz of gold, and 372,851 oz of silver inconcentrate; Ban Houayxai produced 100,938 oz of gold and 906,744 oz of silver in doré metal.
Phu Kham operations include a large open-pit mine and a processing plant that recovers copper and precious metals in concentrate using conventional flotation technology. Annual production of copper in concentrate is expected to rise steadily over the next several years as average copper head grade increases and improving ore quality leads to further gains in metallurgical recovery rates. Annual production of copper in concentrate is expected to peak in 2018 and 2019 at approximately 90,000 mt/y before subsequently declining with ore grade.
Phu Kham concentrate is trucked in covered containers to either Sriracha Harbour south of Bangkok in Thailand or to the port of Vung Ang in Vietnam.
The Ban Houayxai gold-silver mine is located 25 km west of Phu Kham and comprises an open-pit mine feeding ore to a conventional 4-million-mt/y carbon-in leach-plant.
In Papua New Guinea, PanAust holds an 80% interest in the Frieda River copper-gold project, with the remaining 20% held by Highlands Pacific. Frieda River is one of the world’s largest known undeveloped copper and gold deposits and offers potential for the establishment of a long-life operation. Work on a feasibility study is ongoing, with completion targeted for the end of 2015.
The feasibility study currently assumes development of an open-pit mine feeding ore to a conventional flotation plant at an average rate of 30 million mt/y over a 20-year mine life. Production would average 125,000 mt/y of copper and 200,000 oz/y of gold in concentrate.
Relatively soft and highly fragmented ores are expected to be processed in the first five years of Frieda River operations, allowing mill throughput rates of more than 20% above the life-of-mine average and as a consequence above average metal production. Thereafter, the ore is expected to become progressively harder, leading ultimately to throughput rates of approximately 20% below the life-of-mine average in the final years of operation.
