Press Release

11/Jul/00
Padaeng obtains a mining and further exploration license in Laos.

Padaeng Industry Public Company Limited has been licensed to mine and prospect for zinc in Laos, hoping the new activities will help raise its ore reserves and reduce its raw material cost.

According to Padaeng Industry Public Company Limited, a supplementary agreement on zinc mining and exploration signed recently with the government of the Lao People’s Democratic Republic (Lao P.D.R.) allows Padaeng to mine for zinc at the Kaiso deposit as well as further explore for ore in the nearby area covering 12 square kilometres.

The Kaiso zinc deposit, located in Vangvieng, north of Vientiane, is rich in zinc silicate ore, the same as that of Padaeng’s mine at Mae Sot with total reserves of 23,000 metric tonnes. Though the size of the deposit is small ,the ore quality is high , containing zinc at an average of 37%. Zinc from this deposit can be blended with that from the existing mine of Padaeng to produce a higher quality zinc.

Not only would this help optimize the use of natural resources , the new zinc supply from Laos will also help increase Padaeng’s ore reserves and reduce raw material costs. Currently, Padaeng’s mine has total ore reserves of 4.7 million metric tonnes, with grading at 11.3% zinc.

Each year,approximately 200,000-300,000 metric tonnes of zinc silicate ore produced from Padaeng’s mine will be blended with 150,000 metric tonnes of imported zinc sulphide. Zinc silicate and sulphide is blended at a ratio of 40:60, respectively, during zinc processing, which significantly reduces Padaeng’s zinc production costs.

The Vangvieng mine, operated by Padaeng Industry (Laos) Company Limited,wholly owned by Padaeng, will start supplying ore to Padaeng’s zinc smelter in Tak by November. Ore exploration work in the nearby area will also start simultaneously. Padaeng is confident in its potential because the geological conditions are identical to that of the Kaiso deposit. In addition, according to preliminary survey, ore is visible above the surface of the earth.

Mr Arsa Sarasin, Chairman of Padaeng Industry Public Company Limited, said that the zinc mining and exploration licenses awarded by the Government of Laos will not only create mutual business benefits for both countries, but will also help foster existing bilateralties. Moreover, the Government of Laos will obtain benefits in the forms of ore royalty payment and other business taxes and Laos officials will also receive technical assistance and support from Padaeng, such as training courses or factory and mine visits provided by Padaeng.

Padaeng is the sole zinc smelter in ASEAN and is capable of utilizing both zinc silicate and sulphide together in the smelting process, resulting in the world’s lowest cost of production. The smelter has a capacity of 100,000 tons of zinc per year.