Acquires right to new tech to streamline Tantalum

Full text : Acquires right to new tech to streamli Acquires right to new tech to streamline Tantalum Metal Prod

AUSTRALASIAN GOLD MINES NL 2002-05-07 ASX-SIGNAL-G

HOMEX - Perth

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Australasian Gold Mines NL (the "Company") has entered into three
agreements with Boston University, Manufacturing Engineering School
("BU") to develop a process to directly convert oxides to high
purity/low oxygen content metal. The Company has today committed to a
downstream processing strategy involving a revolutionary new patented
processing technology developed by Boston University. The Company has
acquired the exclusive world-wide license rights to the applicability
of the technology in the field of use for tantalum, niobium,
tungsten, gallium, yttrium, thallium and germanium. The Company has
also retained the world rights to sublicense the process and may
choose to develop its own refinery or to license existing refiners.

The company has received support from its customers to pursue the
technology and has received requests for a presentation to the
customers R&D executives. The presentation will be conducted in
Boston late May or during June. The Company is aiming to establish a
vertically integrated tantalum business in Australia producing
low-cost tantalum metal within 3-5 years. This would represent the
first-ever production of tantalum metal in Australia.

BU have had success with their process of using solid
oxygen-ion-conducting membranes (SOM Process) to convert magnesium
oxide directly into metal and has already issued a license for the
commercialization of the process as it relates to magnesium. Initial
research by BU indicates that the technology could be developed for
application to processing tantalum concentrates.

If the research and development project is successfully applied, the
benefits to the industry could include:

* Yield of at least 95% compared with current yield of around 70%;
* Significant saving in capital establishment costs of at least 30%;
* Significant saving in operational costs of at least 30%; and
* A more environmentally friendly process "Green Manufacturing"
process.

The Company has committed to the first stage of a three-stage
Research & Development program which could lead to the establishment
of a semi-commercial pilot facility in Western Australia within three
years. The R&D program will move through three stages:

* Stage 1 (12 months) proof of concept or exploratory work to
confirm that both tantalum oxide and concentrate can successfully be
converted to tantalum metal at laboratory scale (total cost
US$180,000 for R&D payable in stages plus US$25,000 for an option on
a licence);

* Stage 2 (12 months) scaling up of the successful Stage 1
laboratory process (estimated cost US$500,000, to be finalised after
Stage 1); and

* Stage 3 building a semi-commercial pilot plant in Western
Australia.

The Company plans to seek Federal Research & Development grants from
the Australian Government to cover a maximum of 50% of these costs.

Boston University, the USA's 4th largest independent university, is
internationally recognised as one of the world's premier research
universities, and had grants and contracting in 2001 totaling
US$205.1 million.

In a recent announcement, the Company advised that it will change its
name to Tantalum Australia NL and will simultaneously float off its
gold assets into a company named Savannah Gold NL that will seek
listing on the Stock Exchange.

Attached is a copy of a media release pertaining to the technology
project.

P Farrah
COMPANY SECRETARY

MEDIA RELEASE

AUSTRALASIAN EYES FUTURE TANTALUM METAL PRODUCTION AFTER STRIKING
PROCESSING DEAL

Australasian Gold Mines NL (ASX:ATE) has laid the foundations for a
future major expansion of its tantalum business, today committing to
a downstream processing strategy involving the acquisition and
development of a revolutionary new patented processing technology
developed by Boston University of the United States.

The Perth-based Company has signed agreements to acquire the world
rights to the patented process, which has the potential to
revolutionise the US$360 million-a-year global tantalum metal
industry.

Australasian's Managing Director, Mr Michael Fotios, said the Company
was aiming to establish a vertically integrated tantalum business in
Australia producing low-cost tantalum metal within 3-5 years. This
would represent the first-ever production of tantalum metal in
Australia.

Australasian which recently announced plans to spin-off its gold
exploration assets to focus on its growing tantalum business has
committed to a three-stage Research & Development program which could
lead to the establishment of a semi-commercial pilot facility in
Western Australia within three years.

This novel process, developed by Boston University's Manufacturing
Engineering School, uses solid oxygen-ion-conducting membranes (known
as the SOM process) to convert oxides directly to other metals.
Boston University expects it to have lower capital, energy,
environmental and operating costs compared to traditional processes.

In work done to date, it has achieved yields of up to 100% compared
with yields of just 70% in the existing tantalum refinery process.
Australasian estimates that significant capital and operating cost
savings can be achieved compared to existing plants.

"If successful, the development process could establish Australasian
as the world's lowest cost producer of tantalum metal, catapulting
the Company into the world tantalum metal industry with a significant
competitive advantage over existing plants," Mr Fotios said.

"This is a very exciting opportunity for Australasian which
represents a logical extension of our growing tantalum business in
Australia," he added. Australasian, through its subsidiary Tantalum
Australia, is already a significant and growing producer of tantalum
pentoxide for world markets.

The Company has signed a Sponsored Research Agreement and Option
Agreement with Boston University to commence the first stage of
Research & Development. If successful, this could lead to a Licence
Agreement to achieve full commercialisation of the technology.

The SOM process has been used with other minerals and Boston
University has already issued a licence for its use with magnesium.
The R&D program will move through three stages:

* Stage 1 (12 months) proof of concept or exploratory work to
confirm that both tantalum oxide and concentrate can successfully be
converted to tantalum metal at laboratory scale (total cost
US$180,000 for R&D payable in stages plus US$25,000 for an option on
a licence);

* Stage 2 (12 months) scaling up of the successful Stage 1
laboratory process (estimated cost US$500,000, to be finalised after
Stage 1); and

* Stage 3 building a semi-commercial pilot plant in Western
Australia.

Mr Fotios said the Company planned to seek Federal Research &
Development grants to cover a maximum of 50% of these costs.

Boston University, the USA's 4th largest independent university, is
internationally recognised as one of the worlds premier research
universities, and had grants and contracting in 2001 totalling
US$205.1 million.

The SOM Process has been developed by Professor Uday Pal, who is a
faculty member of the Department of Manufacturing Engineering at
Boston University. Professor Pal will lead the Australasian R&D
Program. A number of successful R&D projects have been undertaken at
the Department, including the Gillette company series II disposable
razor assembly process re-design and the AGFA analysis of
stereolithography process.

BACKGROUND

Australasian soon to be renamed Tantalum Australia under a recently
announced de-merger process currently produces around 100,000
pounds of tantalum pentoxide on an annualised basis, sourced from the
Dalgaranga deposit in WA.

Plans are in place to significantly increase this level of output
from additional supply sources such as the Mt Deans deposit in WAs
Eastern Goldfields and the Walwa deposit in Victoria.

Australasian recently committed to a Feasibility Study to develop its
second major Australian tantalum operation at Mt Deans after
announcing an initial resource exceeding 4 million pounds of
contained tantalum pentoxide. This study will focus on the
establishment of a 500,000 tonne per annum plant at its former gold
processing plant site at Norseman. This central facility will source
ore from Mt Deans and the nearby Binneringie deposit.

The proposed de-merger of Australasian's non-tantalum assets is
designed to unlock the value of the Company's gold exploration
projects, placing them in a new focused exploration Company, Savannah
Gold NL, which will seek a separate listing on the Australian Stock
Exchange.

The de-merger, which is expected to be complete by June 2002,
involves an in-specie distribution of shares in the new company to
Australasian shareholders followed by an A$2.6 million initial public
offering.

Released by: On behalf of:
Jan Hope/Nicholas Read Mr Michael Fotios
JAN HOPE & PARTNERS MANAGING DIRECTOR
Telephone: (08) 9388-1474 Australasian Gold Mines NL
Telephone: (08) 6241-1888
Mobile: (0419) 995 503