Pan Australian Resources has obtained loans of US$242 million, including US$160 million for development and construction of the Phu Kham Copper-Gold Project in Laos.

The company secured the loan agreements with a syndicate of five banks - ANZ Investment Bank, BCEL (a Lao bank), DZ Bank, National Australia Bank and Standard Chartered. The syndicate will also provide US$47 million of working capital and cost over-run facilities, if needed, and a US$35 million equipment lease facility secured over the mobile mining equipment.

Pan Australian's managing director Gary Stafford says the bank deal represents a major vote of confidence in the Phu Kham Copper-Gold Project and in Laos as an attractive country to do business in.

"As a result of a very low waste to ore ratio and the excellent infrastructure in the region, the Phu Kham Copper-Gold Project has an extremely competitive capital cost and will be well positioned with regards to cash operating costs, which are predicted to be in the second quartile for copper miners globally."

Phu Kham is fully funded with development ahead of the schedule for first production of copper-gold concentrate by mid-2008. The next few months will see major process plant equipment transported to the site, including the shell for the SAG mill.

Gary Stafford says Phu Kham is one of only a handful of new copper mines that has been committed to in recent times and as a result both the copper metal and copper concentrates markets are likely to remain tight for the foreseeable future.