GIP Gippsland

 

TIDMGIP 
 
RNS Number : 3574O 
Gippsland Limited 
05 March 2009 
 

 
 
5 March 2009 
 
 
Gippsland Limited 
("Gippsland" or "the Company") 
 
 
CORPORATE UPDATE 
 
 
AIM LISTING 
 
 
On 11 February 2009 Gippsland (ASX/AIM "GIP", FRA "GIX") announced that Seymour 
Pierce Limited, its Nominated Adviser ("Nomad") and Joint Broker for the 
purposes of the London Stock Exchange AIM ("AIM") Rules for Companies, had 
resigned. 
 
 Consequently, the Company's shares were suspended from trading 
on the AIM market until such time as a replacement Nomad is appointed. The 
Company's securities continue to trade on the Australian Securities Exchange and 
the Deutsche Börse in Frankfurt. 
 
The Company is presently well advanced in its negotiations with a London-based 
firm to act as the Company's Nomad and Broker.  It is expected that any 
appointment would include and be conditional upon raising additional working 
capital for the Company as well as the mandate to act as Financial Advisor for 
the raising of Gippsland's equity contribution to the Abu Dabbab Tantalum-Tin 
Project scheduled for later this year. 
 
 
ABU DABBAB - PROJECT FINANCE 
 
 
The prime assets of Gippsland are the Abu Dabbab and Nuweibi tantalum deposits 
located in Egypt.  The international group Lycopodium Engineering Ltd has 
completed the Abu Dabbab Definitive Feasibility Study ("DFS") based upon a 
design mill-feed rate of 2 million tonnes per year.  The DFS includes 
projections showing production of 650,000 pounds of tantalum pentoxide (Ta2O5), 
plus 1,530 tonnes of LME grade tin metal per year, over a likely mine life of 20 
years. 
 
 
German bank KfW IPEX-Bank GmbH ("KfW") was appointed Mandated Lead Arranger to 
secure debt finance for the Abu Dabbab Project in December 2007.  This mandate 
has been extended for a further 6 months to 30 June 2009 with the present focus 
being on their technical and legal due diligence process.  KfW is part of the 
Standard & Poor's AAA rated KfW Bankengruppe which is 80% owned by the German 
Government and 20% by the Federal German states (Bundesländer). 
 
 
During this period Gippsland's ability to complete the due diligence process has 
been hampered due to its limited working capital resources and the need for 
management to address corporate matters such as securing a replacement Nomad and 
Broker for its AIM listing. However, with a new Nomad and Broker plus additional 
working capital in place the Company's primary focus will be on addressing all 
outstanding matters in the completion of the due diligence process as quickly as 
possible. 
 
 
Gippsland has secured 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.  As announced in the December 2008 quarterly report, the 
Company is now planning to produce a higher grade tantalum concentrate known in 
the industry as SynCon, containing 55% Ta2O5.  As a consequence of this proposed 
change Gippsland and HC Starck GmbH will review the existing off-take agreement 
in respect to product specifications and price before the due diligence process 
can be completed. 
 
 
The Directors are confident that the outstanding due diligence matters can be 
completed in the near future so that the debt provider's project finance 
approvals may be obtained in the July - September '09 quarter.  Gippsland 
Directors are targeting an attractive 80% debt, 20% equity ratio for the project 
financing. 
 
 
WORLD SCALE RESOURCE - 142.5 MILLION TONNES 
 
 
The Directors are confident that the Abu Dabbab project will play a crucial role 
in supplying the global tantalum industry with a reliable source of tantalum 
feedstock. Given the project's initial mill-feed rate of 2 million tonnes per 
year, the Company's very large resource base of 142.5 million tonnes provides a 
solid foundation for the stable supply of tantalum to world markets for the next 
40 years and beyond. The magnitude of this resource base also provides 
significant opportunities for increased production. 
 
 
 
 
RJ (Jack) Telford 
Executive Chairman 
Gippsland Limited 
www.gippslandltd.com 
 
 
For further information, please contact: 
 
 
Jack Telford 
Gippsland Limited 
T: +61 8 9340 6000 
E: jtelford@gippslandltd.com 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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