PanAust Ltd (ASX:PNA) today increased its production guidance for 2010 to approximately 67,000 tones of copper at an average cash cost of less than US$0.90/lb of copper after precious metal credits, estimated from 60,000oz of gold and 500,000oz of silver in concentrate.

PanAust in October said it was targeting production of about 65,000 tonnes of copper, 55,000 oz of gold and 500,000 oz of silver.

"The upgrade follows strong quarter to date production and cost performances at the company's flagship Phu Kham Copper Gold Operation in Laos, coupled with higher average commodity prices for copper, gold and silver," PanAust said in a statement on Tuesday.

Cash costs during October and November averaged US$0.56/lb.

Costs benefited from seasonal variations following commencement of the dry season and higher than budgeted precious metal production and prices.

Current EBITDA guidance of US$260 million for the 2010 year is based on actual operating performance to the end of November and the assumption that production will exceed sales in the final quarter of the year.

PanAust Managing Director Gary Stafford said "The Phu Kham Operation is proving to be a consistent performer at a time when prices for copper and precious metals are rising, providing both higher than budgeted revenue and increased by product credits against operating costs".

Financial and production guidance for the 2011 year will be provided in late January along with the December 2010 quarterly report.

At 1340 AEDT, PanAust shares gained six cents, or 8.05 per cent, at 80.5 cents. More than 53.8 million PNA shares worth $43 million changed hands, making it the third most traded stock by volume.