London, England — MININGREVIEW.COM — 06 October 2008 – Gippsland Limited – an Australian-based international resource company listed on the Australian Stock Exchange and the London Stock Exchange’s Alternative Investment Market – has completed a R6.5 million placing of 17-million fully paid ordinary shares to help develop the 44.5 million-tonne Abu Dabbab and the 98 million-tonne Nuweibi tantalum projects in Egypt.
A Gippsland statement released here said the funds raised under the placing would be used for working capital purposes and for the further development of the company’s two tantalum projects
Gippsland has completed a definitive feasibility study for the Abu Dabbab project, having a design mill-feed rate of 2 million tonnes per annum. It is scheduled to produce 650 000 pounds of tantalum pentoxide (Ta2O5), plus 1 530 tonnes of LME grade tin metal per year, commencing in late 2010.
The company has also concluded a 10-year tantalum off-take agreement with the German tantalum major HC Starck GmbH for the supply of 6 million pounds of tantalum pentoxide, representing more than 90% of the total initial tantalum production during this period.
The Abu Dabbab project alone is expected to have a mine life of 20 years, however with Gippsland’s total JORC code resources exceeding 140 million tonnes, the company will look to increase tantalum and tin production substantially following commencement of operations. Recent enquiries from third party tantalum consumers indicate that an expansion of production would be well supported.
Gippsland directors are presently in project finance negotiations with the German government owned KfW Bankengruppe, and are targeting an attractive 80% debt 20% equity facility, which they anticipate will be concluded successfully before the close of 2008.