The significant increase in the Ore Reserve during 2006 and 2007, 25% on that of the Feasibility Study for the Stage 1 of the project development, has set the stage for a rapid expansion of the processing facilities at Lady Annie.

 The Feasibility Study to expand the operation from 19,000 tpa to 30,000 tpa copper cathode has been completed and the project has received approval from the CopperCo board.

• The study indicates that the lift in production would add approximately $188 million in after tax net present value (8% discount value) to the value of the project. The marginal operating cost of producing the additional 11,000 tonnes annually is estimated at US$0.64/lb. 

• The capital cost for the expansion project is estimated at $32.4 million which translates to a capital cost of $2,950 per annual tonne of copper produced for the increased production capacity of 11,000tpa.

 The Company is targeting July 2008 to commence the ramp up of production to 30,000 tpa copper cathode.  Environmental approval to expand the operation to 30,000 tpa was received in March 08. The key long lead electrowinning transformer has been delivered with the other main long lead items, including the rectifier, cathodes and anodes, on schedule to meet the target commissioning dates.

 The Expansion Project will be constructed in a phased approach, Stage 2 (southern) and Stage 3 (northern). Stage 2 will be constructed during the period January 08 to September 08 and will include the following scope of work:

• Construction of the second 175,000 m2 leach pad plus an additional 124,000 m2, both to the south of the existing leach pads.
• Construction of a storm water pond to accommodate the additional leach pads.
• Extend the leach pad trunk conveyor to the south to service these leach pads.
• Construction of the Lady Annie Haul Road and a further upgrade of the site access road.
• Construction of a 200 mega litre raw water storage dam.
• Extensions to the SX and EW plant facilities.
• Expand the accommodation camp facilities to cater for an additional 50 operations personnel.

Construction commenced in mid January 08 with concrete works scheduled for completion in mid April 08. Construction activities on the Lady Annie haul road and the southern leach pad extension will commence in early April 08.

Apart from the mechanical and piping installation contract, all major site works contracts are in place.

The overall the program anticipates commissioning of the expanded electrowinning capacity commencing in June 08 and the solvent extraction capacity in August 08

Stage 3 is currently scheduled to be constructed during the period April 09 to Sept 09 and will include the following scope of work:

• Construction of an additional 175,000 m2 leach pad to the north of the existing pads.
• Construction of the Stage 3 process solution ponds and pumps alongside the new leach pad.
• Construction of an additional storm water pond.
• Re-arrangement and upgrade of the leach pad trunk conveyor to facilitate the northern leach pad.
• Possible upgrading of the existing crushing system.