Adelaide, Apr 18, 2006 (ABN Newswire) - New figures for Australia's next zinc mine - Terramin Australia Limited's (ASX: TZN) Angas project at Strathalbyn near Adelaide - reveal a zinc cash cost of US 18 cents per pound (after credits).

The current zinc price - of around US$1.34 price per pound is more than seven times Angas' estimated production costs.

Executive Chairman, Dr Kevin Moriarty, said today new cost figures are contained in the final feasibility study to be released late this month following receipt of remaining tenders.

"The considerable differential between production cost and on-market commodity prices for zinc underpins the long-term potential for Angas," Dr Moriarty said.

"The price-cost differential even accommodates our decision earlier this year to increase capital costs by between $10-15 million to enhance the mine's environmental integrity," he said.

"We are currently in advanced negotiations with several banking groups to realise full debt funding for the capital works program".

Other figures released by Terramin today show:

- The Angas JORC compliant mine plan reserve is 2.34 million tonnes at 8.1% zinc, 3.1% lead, 33 g/t silver and 0.5 g/t gold

- Initial mine, process plant, site infrastructure and tailings storage facility capital cost is estimated at A$63 million (including a 10% contingency) compared to the more than $50 million estimate in February this year

- Average life of mine cash costs (mining milling, freight and administration) are estimated at A$79 per tonne mined

- The average cash cost is estimated at US 18 cents/lb zinc (after lead and silver credits)

- The average total cost is estimated at US 37 cents/lb zinc (after lead and silver credits)

- In its first year of full operation, 2008, forecast net cash flow would be A$75 million at current metal prices

- If current world zinc prices are maintained, the project would generate net cash flows of A$343 million before hedging interest, tax and depreciation over its initial seven year life.

                  2007     2008     2009     2010
                      
Mined tonnes      151,000  398,000  431,000  392,000
% Zinc            6.40     9.62     8.04     6.96
% Lead            2.23     3.32     3.16     2.81
g/t Silver        23       38       30       32

Milled tonnes	  151,000  398,000  400,000  400,000

Zinc concentrate
Conc grade-% Zn   52       52       52       52
Recovery (%)      87       91       90       88
Tonnes            16,000   66,900   55,200   46,900

Silver-lead concentrate
Con grade-% Pb    60       60       60       60
         -g/t Ag  510      535      440      530
Recovery (%)      80       87       86       84
Tonnes            4,500    19,000   18,000   15,700

Dr Moriarty advised current metallurgical investigations were focused on production of a copper-lead concentrate targeting the coincident recovery of payable gold credits.