Company Information for Prairie Downs Metals Ltd

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Company Statement

Listed on the Australian Stock Exchange (ASX:PDZ) and based in Perth, Prairie Downs Metals Limited is exploring and developing high grade zinc, lead and copper deposits at the Prairie Downs project in Western Australia.

Corporate objectives for 2008 are to complete the Feasibility Study now underway to finance and develop a copper/lead/zinc/silver mine at Prairie Downs; commence a 20,000 metre drill program to test extensions to existing resources and new copper discoveries; continue exploration with particular focus on copper; increase existing zinc-lead resources and define new copper resources.

The total Global Resource in three lodes is 4.7 million tonnes at a grade of 6.3% zinc, 1.8% lead and 18g/t silver at a nominal lower cut of 1% zinc. This resource contains 295,000 tonnes of zinc, 83,000 tonnes of lead and 2.6 million ounces of silver. The global resource includes a High Grade Resource of 1.6 million tonnes at a grade of 12.3% zinc, 3.7% lead and 36g/t silver. At 1 March 2008 (LME 3mo prices) the Global Resource had an in situ value of USD1.14 billion

Prairie Downs Metals Limited has made a spectacular copper discovery at the Prairie Downs Project. Results include a channel sample over a seven metre width averaging 5.6% copper and 0.9% lead from nearly 300 samples. The high grade, coupled with projections for a continued high copper price, makes this a very exciting discovery for the Company.

This discovery of copper mineralisation at surface has resulted in an increased focus on exploration. While this will of necessity delay project development it is also expected to increase project value, facilitate more effective financing, and reduce project risk.

The Prairie Downs Zinc project has a number of competitive advantages, the most important being the high metal grades, shallow mineralisation and excellent resource upside. The high grades will mimimise the capital payback period and lessen the impact of a lower zinc price while maximising revenue from a higher price. The fact mineralisation commences at the surface will help minimise both capital and operating costs and the resource upside should readily ensure that expansion plans can be implemented and mine life extended beyond 10 years.

Copper will be the priority going forward as it reduces the Company's dependence upon a single commodity and thus effectively provides a hedge against zinc prices and vice versa. In addition, the copper mineralisation occurs at surface and therefore any copper resources that are defined are likely to be amenable to open cut mining. This would be an important benefit to project economics.

Current Operations

Prairie Downs: Zinc-Lead-Silver
The Prairie Downs Zinc Project comprises two Exploration Licences and is located approximately 100 kilometres southwest of Newman in the Eastern Pilbara, Western Australia. The project area is easily accessible by 4WD, about 1.5 hours from Newman.

The primary focus at Prairie Downs is high grade zinc-lead-silver deposits in the vicinity of the Prairie Downs Fault, which is a major regional structure.

The total Global Resource in three lodes is 4.7 million tonnes at a grade of 6.3% zinc, 1.8% lead and 18g/t silver at a nominal lower cut of 1% zinc. This resource contains 295,000 tonnes of zinc, 83,000 tonnes of lead and 2.6 million ounces of silver. The global resource includes a High Grade Resource of 1.6 million tonnes at a grade of 12.3% zinc, 3.7% lead and 36g/t silver. At 1 March 2008 (LME 3mo prices) the Global Resource had an in situ value of USD1.14 billion.

With drilling expected to recommence early in 2008, the resource is expected to increase in both tonnage and grade as we head towards production.  The target is 10 million tonnes.

Abesque Engineering & Construction Limited has been commissioned to design a 300,000 tonnes per annum processing plant with the capability to expand to 1,000,000 tonnes per annum.  This follows on from a high level scoping study completed in May 2007.  It will take approximately 6 months to complete with construction expected to take a further 12 months with production commencing in 2009.

The Prairie Downs Zinc project has a number of competitive advantages, the most important being the high metal grades, shallow mineralisation and excellent resource upside. The high grades will mimimise the capital payback period and lessen the impact of a lower zinc price while maximising revenue from a higher price. The fact mineralisation commences at the surface will help minimise both capital and operating costs and the resource upside should readily ensure that expansion plans can be implemented and mine life extended beyond 10 years.

Geographical Spread

Western Australia

Board of Directors and Key Management

Broker/Analyst Reports

09/10/07 - Southern Cross Equities Research Report

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