Panoramic, BHP increase ore supply deal

Panoramic Resources Ltd has struck a deal with BHP Billiton Nickel West to supply more nickel ore for processing from its Lanfranchi project in Western Australia in the 2009 financial year.

The new deal is above the currently contracted 350,000 tonnes per annum, Panoramic said today.

Under the Ore Tolling and Concentrate Purchase Agreement between and the Lanfranchi joint venture parties, BHP has the first right to additional ore from the Lanfranchi Project resources.

Forecast production and deliveries from the Lanfranchi Project in 2008/09 is approximately 450,000 tonnes of ore which is a 60 per cent increase on the tonnes delivered to Nickel West in the previous 12 months.

Panoramic said the continuing increase in production highlights the quality of the resources at the Lanfranchi Project which supports its stated group production target of 20,000t nickel per annum for the next 10 years.

Panoramic's preliminary group production forecast for the operations for 2008/09 is in the range of 20,500-21,500t nickel contained plus copper and cobalt credits (100% project basis), which would represent a 30-45 per cent increase on 2007/08.

This forecast is based on first Copernicus ore treated at the Savannah mill in October 2008 and commissioning of the new Deacon ventilation system in late December 2008.

Panoramic's equity share of forecast production is in the range of 17,000-18,000t nickel contained.