P A N A U S T R A L I A NR E S O U R C E S L I M I T E D

Corporate Update May 2007

Project Location Map S/E Asia

Phu BiaContract Area

PuthepPuthepProjectProject

CHIANG MAIBELT

TRUONGSONBELT

LOEI-PHETCHABUN/ LOUANGPHABANG BELT

Mae Sot

Chatree

LEGEND

Acid igneousrocks

Palaeozoic-Mesozoicvolcano sedimentary belt - volcanic arcs

CHIANG MAI BELT

TRUONGSON BELT

LOEI-PHETCHABUN/ LOUANGPHABANG BELT

SeponSepon

Focus & StrategyPhu Kham Phu Bia Gold Mine:Phase I Strategic greenfield “starter” project

Op’s team, systems, infrastructure established

Phu Kham Phu Kham Copper-Gold Project:Phase II Brownfield development

Fully financed June 2006Owner operate mining late 2006 Pre-commissioning from December 2007Concentrate sales from mid-2008

Exploration & Maintain project pipeline:Acquisitions US$13m exploration & evaluation budget 06/07

Phu Bia Mining Ltd

Ownership Pan Australian 90%, Gov’t of Laos 10%:

paid for from future free cash flow

Corporate Tax Rate 25% from first year of profit after realising

tax losses of US$54M at end 2006

NSR Royalty Regime Scaled by metal price between 3% and 6%

Contract Area Retained at 2,637km2 ~1.1% of Laos

Tenure 30 years, refreshed with each new mine

Phu Kham Deposit Schematic Section

Phu Kham Copper-Gold Ore Reserve*

Category Tonnes(Mt)

Cu Grade(%)

Au Grade(g/t)

Copper Metal (000 t)

Gold Metal (M oz)

Proved 67 0.63 0.28 420 0.6

Probable 77 0.51 0.23 390 0.6

Total 144 0.56 0.25 810 1.2

• 85% of Measured & Indicated Resources convert to Ore Reserve

• 9M t of Inferred Resources fall within final pit shell

• Strip ratio exceptionally low at 0.57:1

*Refer JORC compliant Mineral Resource announced to the ASX on 3 April 2006

Price assumptions: Copper US$1.35/lb, Gold US$450/oz, Silver US$8.00/oz

Phu Kham Copper-Gold Project

Mine Life +12 years

Throughput Rate 12M tpa

Annual Concentrate 207,000dmt @ 25% Cu, 7g/t Au, 65g/t Ag

Annual Production 52,000t Cu, 47,000oz Au, 400,000oz Ag

Development Capital US$241m (Inc US$28m contingency)

Senior Debt / Equity ~51 / 49

Mine Site Cash Cost* US¢ 40/lb

Total Cash Op Cost* US¢ 74/lb* After precious metal credits: US$450/oz gold and US$8.00/oz silver.

Feasibility study predictions using conventional technology

Total Funding Envelope

US$M

Capital cost estimate 241.1

Pre-commissioning costs 11.0

Financing costs inc. cap interest 20.4

Refinancing existing facilities 10.0

Working capital 12.5

Total uses of funds 295.0

Fully funded: ~50/50 debt/equity

Phu Kham Development: March 2007…

... on schedule, within budget

... on schedule, within budget

Phu Kham Development: March 2007…

Phu Kham Process Plant

Benefits from 3-D Model

Development & CommissioningMilestones

First concrete pour December 2006 Achieved

Start structural steel work March 2007 Achieved

Critical concreting & June 2007 On schedule machining of mills complete

Main mill components on site September 2007 On schedule

Pre-commissioning start December 2007 On schedule

First production mid-2008 Ahead of Schedule

Points of Difference

Strip Ratio 0.57:1 one of the lowest strip mines in the world

Mining down-grade haul from pit to crusher in early years

Work index 9 to 15 kWhr/t – lowest in early years

Power Mine 12km from hydro-power line

Capital Development within US$241M capital budget

Delivery Ahead of schedule for first concentrate mid-2008

Resource New resource and reserve prior to start-up

Phu Kham Plan View

• In-fill drilling of north mine area started February 2007

• Aim is to upgrade indicated and inferred mineralisation

Cross Sections

+1% copper in floor of final pit

Limited drilling below current

pit

Cash Operating CostsCopper mine cost curve, 2009

-50

0

50

100

150

200

0 2000 4000 6000 8000 10000 12000

Cumulative production (000t)

Bus

ines

s op

erat

ing

cost

(c/lb

Cu)

1st Quartile 2nd Quartile

8th Decile 9th Decile

Phu Kham

Assumptions:Copper price: US$1.00/lbGold price:US430/ozSilver price:US$6.50/ozMolybdenum oxide price:US$4.56/lbTC:US$55/dmtRC:US5.5/lbProduction:52,312t contained CuBusiness operating cost: US$0.659/lb

Scenario 2

Competitive on Capital Intensity

Mine & Mill Industry Average

~US$5,500/t Cu Equiv in 2003 Dollars

Phu Kham

~US$3,900/t in 2006 Dollars ~US$3,700/t in 2003 Dollars CPI Adjusted ~US$2,700/t in 2003 Dollars Mine Cost Inflation Adjusted 0

1000

2000

3000

4000

5000

6000

7000

8000

1985 1990 1995 2000 2005 2010

Cap

ital I

nten

sity

US$

/t C

u Eq

uiv

2006 Dollars

2003 Dollars cost inflation adjusted

2003 DollarsCPI adjusted

Capital Expenditure 31 March 2007

Phu Kham Copper-Gold Economics

Cu Price Au Price Annual Cash Flow

CapitalPayback

US$1.35/lb1 US$450/oz US$50M

Concentrate Transport

BHP Billiton & Sempra

BHP Billiton – manager of all concentrate sales

Exposure to global market presence and expertise

Optionality on benchmark or spot sales

Sempra – guaranteed offtake for 50% of production

US$5M placement at $0.55 per share – 20% premium

US$10M debt facility on very competitive terms

Phu Bia Gold: December 2006

Gold Production

MiningMining activities integrated from 1Jan 2007

Exploration & Evaluation – US$13M in 2007

Other Exploration,

US$0.6M

Other Evaluation, US$1.0M

Ban Houayxai, US$2.6M

Northern Exploration

Area, US$3.7M

Southern Exploration

Area, US$1.7M Phu Kham

Copper-Gold, US$2.6M

Magnetic & Radiometric

Survey, US$0.8M

Drilling at Tharkhek

Ore Reserve discovery cost to date:

US$2.5/oz gold equivalent, or

US¢1.3/lb copper equivalent

Exploration & Evaluation Prospects

14m @ 1.9g/t Au13m @ 0.5% Cu55m @ 164g/t Ag

18m @ 17.2g/t Au from surface12m @ 9.1g/t Au from 38m22m @ 9.4g/t Au from 24m

10m @ 14.6g/t Au & 198g/t Ag2m @ 5.9g/t Au & 87g/t Ag

Soil anomaly 4 x 2kmsoil samples of over 1,600ppm Curock chips grading up to 1.3% Cu Channel samples up to 0.76% Cu over 5m

Ban Houayxai Deposit

East

300m EOH

> 0.3 g/t Au

> 0.3 g/t Au Equiv alent

SignificantSignificantSignificantSignificantSignificantSignificantSignificantSignificantSignificantInterceptsInterceptsInterceptsInterceptsInterceptsInterceptsInterceptsInterceptsIntercepts

Cry stal Lithic and Cry stal Tuf f

249.5m EOH

300m EOH

HDD006

Sericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration Envelope

BOCO

HDD007

HDD009

West

BOPO

132m @ 0.9g/t Au Eq from 4m inc. 19m @ 2.7g/t Au Eq from 59m

196m @ 1.3g/t Au Eq from 2m inc. 68m @ 3.2g/t Au Eq from 60m

Gold to silver price ratio assumption: 50 to 1

Crystal Lithic and Crystal Tuff

EastHDD008

300.3m EOH

299.88m EOH

SignificantSignificantSignificantSignificantSignificantSignificantSignificantSignificantSignificantInterceptsInterceptsInterceptsInterceptsInterceptsInterceptsInterceptsInterceptsIntercepts

HDD010

248m EOH

HDD011

HDD012

250.1m EOH

Sericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaSericite-SilicaAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration EnvelopeAlteration Envelope

West

BOCO

BOPO

>0.30g/t Au >0.30g/t Au Equivalent

44m @ 0.7g/t Au Eq from 4m and 64m @ 3.4g/t Au Eq from 66m

36m @ 3.2g/t Au Eq from 54m inc. 10m @ 10.6g/t Au Eq from 54m

42m @ 1.8g/t Au Eq from 24m and 21m @ 1.6g/t Au Eq from 81m

94m @ 0.9g/t Au Eq from surface

98m @ 1.4g/t Au Eq from surface inc. 38m @ 2.0g/t Au Eq from 38m

North X-Section

South X-Section

Pha Nai Prospect

20km north of Phu Kham

High tenor, up to 0.18% copper soil anomaly

1.5km x up to 1.0km within a 4km x 2km halo

Elevated molybdenum (70 to 150ppm) and gold zones

Drilling to start mid-2007

Project Location Map S/E Asia

Phu BiaContract Area

PuthepPuthepProjectProject

CHIANG MAIBELT

TRUONGSONBELT

LOEI-PHETCHABUN/ LOUANGPHABANG BELT

Mae Sot

Chatree

LEGEND

Acid igneousrocks

Palaeozoic-Mesozoicvolcano sedimentary belt - volcanic arcs

CHIANG MAI BELT

TRUONGSON BELT

LOEI-PHETCHABUN/ LOUANGPHABANG BELT

SeponSepon

Puthep Copper Project

Pan Australian earning 60% interest

Largest known copper deposit in Thailand

PUT 1 Mineral Resource*: 85m t @ 0.44% for 370,000t copper

Thai Government approval for BFS received November 2006

Infill and extensional resource drilling started March 2007

Targeting primary copper-gold mineralisation below transitional

Bulk flotation concept similar to Phu Kham to be evaluated

BFS envisaged to be completed by end 2008* Refer JORC compliant Mineral Resource presented in 2006 Annual Report

Community & Phu Kham

Socio-economic Survey: March 2007Household income up 385% and 248% since December 2003 in the villages of Nam Gnone and Nam Mo respectively

Shift from subsistence agriculture to cash based economy

70% and 14% of households in Nam Mo and Nam Gnone respectively have in house sanitation versus none in 2003

Distance to village water supplies are now less than 50m

Population growth of 50% to 80% occurring due to in-migration which is supplementing the labour pool

A “high level of community satisfaction for Pan Aust’s mining operations”was concluded

Community Initiatives

Summary - Company Potential

Total Cu (t) Au (oz)Mineral Resource 1,700,000 2,000,000

Capital Structure

Issued securities 1,411M sh’s, 38M opt’s & rights

Share price ~55 cents

Market capitalisation ~A$770 million

Cash March 2007 US$53 million

Debt March 2007 None

Debt facilities un-drawn US$243 million

Indexation (Current) ASX 300

ASX Code: PNA

This presentation has been prepared by the management of Pan Australian Resources Limited (the 'Company') for the benefit of brokers, analysts and investors and not as specific advice to any particular party or person.

The information is based on publicly available information, internally developed data and other sources. No independent verification of those sources has been undertaken and where any opinion is expressed in this document it is based on the assumptions and limitations mentioned herein and is an expression of present opinion only. No warranties or representations can be made as to the origin, validity, accuracy, completeness, currency or reliability of the information. The Company disclaims and excludes all liability (to the extent permitted by law), for losses, claims, damages, demands, costs and expenses of whatever nature arising in any way out of or in connection with the information, its accuracy, completeness or by reason of reliance by any person on any of it.

Where the Company expresses or implies an expectation or belief as to the success of future exploration and the economic viability of future projects, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, such forecasts are subject to risks, uncertainties and other factors which could cause actual results to differ materially from future results expressed, projected or implied by such forecasts. Such risks include, but are not limited to, exploration success, gold and copper price volatility, changes to the current mineral resource estimates, changes to assumptions for capital and operating costs as well as political and operational risks and governmental regulation outcomes. For a more detailed discussion of risks and other factors, refer to the Directors' Report in the Company's 2006 Annual Report which has been lodged with the Australian Stock Exchange, as well as the Company's other Australian Stock Exchange announcements and filings. The Company does not have any obligation to advise any person if it becomes aware of any inaccuracy in or omission from any forecast or to update such forecast.

Disclaimer

Joe Walsh

General Manager Corporate Development

Website: www.panaustralian.com.auEmail: info@panaustralian.com.au

P A N A U S T R A L I A NR E S O U R C E S LIMITED

Slide Number 1Slide Number 2Slide Number 3Focus & StrategyPhu Bia Mining LtdPhu Kham Deposit Schematic SectionPhu Kham Copper-Gold Ore Reserve*Phu Kham Copper-Gold ProjectTotal Funding EnvelopePhu Kham Development: March 2007…Phu Kham Development: March 2007…Phu Kham Process PlantSlide Number 13Points of DifferencePhu Kham Plan ViewCross SectionsCash Operating CostsCompetitive on Capital IntensityCapital Expenditure 31 March 2007Phu Kham Copper-Gold EconomicsConcentrate TransportBHP Billiton & SempraPhu Bia Gold: December 2006Gold ProductionMiningExploration & Evaluation – US$13M in 2007Exploration & Evaluation ProspectsSlide Number 28Pha Nai ProspectSlide Number 30Slide Number 31Slide Number 32Community InitiativesSummary - Company PotentialCapital StructureDisclaimerSlide Number 37