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Gippsland focuses on world-scale projects which have been over-looked by major resource groups. Projects which have undergone detailed exploration and which have the potential to be brought into production quickly are a prime target for the Company. Gippsland's success in this area is due in part to the Company's philosophy of entering into equitable joint venture arrangements with overseas nationals. The Company's prime assets are the 40 million tonne Abu Dabbab and the 98 million tonne Nuweibi tantalum-tin projects located in the Central Eastern Desert of Egypt, adjacent to the western shore of the Red Sea.
Gippsland gets approval to use portsite for Abu Dabbab tantalum project
Gippsland Ltd said it has received Egyptian authority approval to use Port Turumbi for the Abu Dabbab tantalum project.
The company’s joint venture vehicle Tantalum Egypt JSC made an application In November 2008 to acquire the Port Turumbi portsite for the export of approximately 1.5 million tonnes per year of ceramic grade feldspar produced as a by-product from the 44.5 million tonne Abu Dabbab project.
Gippsland announced today that the Egyptian National Centre for Planning and Usage of State Land has approved the use of Port Turumbi for the project.
The 44.5 million tonne Abu Dabbab project is scheduled to produce in excess of 650,000 pounds of tantalum pentoxide per year over a projected mine life of 20 years. The project, which will also produce approximately 1,530 tonnes of LME grade tin per year, is likely to become the world's largest supplier of tantalum feedstock, the company said.
Gravity separation techniques will be employed to extract the tantalum and tin from the Abu Dabbab mineralisation. Testwork commissioned by Gippsland in Australia and Italy has demonstrated that the resulting tailings) can be utilised to produce up to 1.5 million tonnes per year of premium grade feldspar suitable for the manufacture of ceramic tiles and sanitary wear.
At full production, the net revenue from feldspar is expected to exceed U$20 million dollars per year.
Gippsland executive chairman Jack Telford said: “The support for the project being provided by the highest levels of the Egyptian government is most encouraging and bodes well for the successful implementation of the Abu Dabbab project which we are confident will become the prime focus of global tantalum production. We are also pleased by the attention being paid to the project by the KfW Bankengruppe, which is owned by the German government and the German federal states. This is of particular relevance when one considers that Egypt is a major recipient of German foreign aid.”
Following the recently announced closure of Wodgina, which was the world's largest tantalum mine, Abu Dabbab is set to fill the expected void in the supply of this strategic metal, he added.
The group announced in November it was is well advanced in its project finance negotiations with the German bank KfW IPEX-Bank GmbH (KfW) and Deutsche Investitions und Entwicklungsgesellschaft mbH (DEG), both part of KfW Bankengruppe GmbH, which is 80 percent owned by the German federal government and 20 percent by the German federal states. It said it expected KfW and DEG to state their position with respect to project finance for Abu Dabbab by the end of February 2009.
