Project and corporate update

    RNS Number : 8434D
  Gippsland Limited
  22 September 2008
   

        
    
Gippsland Limited ("Gippsland" or the "Company")

    PROJECT & CORPORATE UPDATE
    
    *     Project financing for Abu Dabbab on track
    *     Abu Dabbab EPCM contract negotiations well advanced for completion by end October '08
    *     3 highly prospective tenements in Eritrea anticipated to be granted October '08


    ABU DABBAB PROJECT FINANCE
    Directors of Gippsland Limited [ASX, AIM: GIP, Deutsche Be: GIX] do not foresee that the recent international financial instability will
adversely affect project financing for the Company's world-scale 44.5 million tonne Abu Dabbab tantalum-tin project. Negotiations are
presently in progress with KfW Bankengruppe which is owned 80% by the German Federal Government and 20% by the German federal states
(Bundeslder). The KfW legal due diligence associated with the Abu Dabbab project is nearing completion.
    ABU DABBAB EPCM
    
    Detailed negotiations with several engineering groups for the Abu Dabbab Engineering, Procurement, Construction Management (EPCM)
contract have been undertaken during the past three months. An EPCM contract is expected to be executed between the Company and the
successful engineering group prior to the end of October 2008.

    USA INSITUTIONAL SHAREHOLDING
    An evaluation of the Gippsland share registries in the United Kingdom and Australia was recently carried out to identify potential
exposure to USA-based institutional shareholders, who may be more exposed to financial instability. To the best knowledge of the Directors,
the Company has no USA-based institutional shareholders, save for the Washington based International Finance Corporation* which is part of
the Standard and Poors AAA rated World Bank Group. Holding 25 million Gippsland shares (8.16%), the IFC is a substantial Gippsland
shareholder. 
    ABU DABBAB TANTALUM PRODUCT NOT RADIOACTIVE
    Gippsland Directors see that recent industry participant announcements relating to tantalum feedstock price increases and possible
shortages along with increasing tantalum end product prices, bodes well for the Abu Dabbab project which is predicted to set a new industry
standard for low production costs whilst producing a premium grade product having a Ta2O5 content in excess of 40%. Importantly, the Abu
Dabbab product will not be classified as an International Maritime Organisation (IMO) Class 7** radioactive material as the combined U3O8
and ThO2 will be well below the maximum limit of 0.1%.  Most sources of tantalum feedstock have difficulty in achieving this 0.1% limit.
    The Directors are very confident that the Abu Dabbab project will play a crucial role in the supply of tantalum feedstock to the global
industry for several decades.
    ERITREAN COPPER-GOLD TENEMENT APPLICATIONS
    The Company's 100% owned subsidiary Nubian Resources PLC ("Nubian Resources") has made application for three highly prospective
Prospecting Licences in the northern part of Eritrea.  The Company would not normally announce the lodgement of tenement applications,
however as the Eritrean Ministry of Energy and Mines has released details of the Nubian Resources applications in various internationally
distributed publications, the Directors believe that disclosure of these tenement applications to the general market is warranted.

    These licences each of 100km2 cover alteration targets identified from satellite interpretation and are prospective for base metal
mineralisation similar to the world class Bisha volcanic massive sulphide (VMS) deposit located in south-western Eritrea. They are also
similar in structure to the Sub-Sahara Resources NL Zara gold project located immediately to the south of the three Nubian Resources
application areas.

    The Company has been actively evaluating the regional mineral potential of the Arabian-Nubian Shield which is the host of Gippsland's
44.5 million tonne Abu Dabbab and 98 million tonne Nuweibi tantalum projects plus the Company's Wadi Allaqi gold copper-nickel prospects in
Egypt.  

    The Arabian-Nubian shield extends over large parts of Egypt, Sudan, Ethiopia and Eritrea, Saudi Arabia and Jordan. In Eritrea a number
of large base metal and gold deposits have recently been discovered.  The Nevsun Resources Ltd Bisha base metal-gold deposit is due to
commence production in 2009 and expected to produce around 1Moz of gold, 340kt of copper and 499kt of zinc over a ten year life. The Emba
Derho project managed by Sunridge Gold Corporation near the capital Asmara is emerging as a 51 million tonne base metal-gold deposit
containing 0.87Moz of gold, 453kt of copper and 1.043kt of zinc. Further north, to the immediate south of the Nubian Resources applications,
the Sub-Sahara Resources NL Zara project contains slightly in excess of 1Moz of gold at a grade of 6.31g/t.

    The Nubian Resources applications are in the same structural corridor as the 1Moz Zara project and a similar volcanic setting as that
hosting the Bisha deposit.  The Directors anticipate that the tenements will be granted during October 2008.

    RJ (Jack) Telford
    Executive Chairman 
    Gippsland Limited
    www.gippslandltd.com  

    For further information please contact:

 Jack Telford
 Gippsland Limited
 T: [phone]
 E: [e-mail]  

 Richard Hail                         John Gilbert
 Fox-Davies Capital Ltd               Fox-Davies Capital Ltd
 T: [phone]                  T: [phone]
 E: [e-mail]            E: [e-mail] 

 Nandita Sahgal                       Matthew Thomas
 Seymour Pierce Limited               Seymour Pierce Limited
 T: [phone]                  T: [phone]
 E: [e-mail]   E: [e-mail] 

 Jane Stacey                          Fiona Hyland
 Investor Relations                   Investor Relations
 M: [phone]                  M: [phone] 
 E: [e-mail]                E: [e-mail]

    *  IFC fosters sustainable economic growth in developing countries by financing private sector investment, mobilising capital in the
international financial markets, and providing advisory services to businesses and governments. IFC helps companies and financial
institutions in emerging markets create jobs, generate tax revenues, improve corporate governance and environmental performance, and
contribute to their local communities. The goal is to improve lives, especially for the people who most need the benefits of growth. 
www.ifc.org/about 

    **  The shipment of IMO Class 7 radioactive materials is highly restricted by international shipping regulations to the extent that they
are not permitted to enter the European Economic Zone, Japan and numerous other countries unless shipped by a dedicated vessel. The road
transportation of IMO Class 7 materials within Europe and numerous other jurisdictions is extremely difficult to the point of being
impractical.


This information is provided by RNS
The company news service from the London Stock Exchange
 
  END 
 
MSCBKLFFVKBFBBK