Gippsland Expects To Improve Results Of 2004 Feasibility Study For Abu Dabbab Tantalum-Tin Project.
AIM Listed Gippsland has been having a busy and successful time of late. It kicked off this week with the announcement that the Environmental Impact Assessment for its 40 million tonne Abu Dabbab tantalum-tin project in Egypt has been approved by the Egyptian Government's Environmental Affairs Agency. It is the first EIA of its kind that has been concluded in Egypt and the fact that one of the specialists involved was the Egyptian environment Group Environics underlines the advantages of having a joint venture with the Egyptian Geological Survey and Mining Authority which has a 50 per interest in the project as the guidelines established by the World Bank Group were complemented by those provided by Egyptian legislation.
The EIA process was conducted in parallel and interactively with project design. As a result, potential negative environmental effects were mitigated, through appropriate design and environmental management, to acceptable levels by international standards. This follows the news last week that the company had raised £600,000 by a placement of shares to UK investors carried out by its brokers HB-Corporate. This was concluded during a week when the major integrated mining groups were having a hard time and, at one point, the junior mining sector was down by more than 5 per cent though by the close had pulled back to finish just over 4 per cent.
The third bit of news was on drilling at the Wadi Allaqi gold project in south eastern Egypt. Not only were the grades good, but investors tend to look on Gippsland as a one project company and this emphasizes the width of the portfolio. Back in June the company announced that it had obtained anomalous gold values from geochemical sampling in three areas. At the Seiga prospect rock chip sampling returned 20.3 metres at 7.40g/t. At the Um Shashoba prospect sampling of wall rocks adjacent to ancient workings gave a best result of 11.9 metres at 2.22g/t gold. Rockchip sampling at Haimur returned 2 metres at 71.37g/t gold while regolith sampling at Haimur and Um Shashoba returned anomalous samples of up to 2.42g/t and 6.27g/t gold respectively.
At the end of last month Gippsland had followed up these results with trenching at Haimur and Um Garayat using a mechanical excavator and work was done by hand at Seiga. Rock chip sampling at the last of these identified a 34.5 metre wide zone of gold across old workings which included 20.3 metres at 7.4 g/t gold and 8 metres at 7.7 g/t. A 20 metre trench to the west of the chip sampling returned 2.83 g/t and widened the gold mineralised zone to 50 metres. As a result it now extends over a length of 250 metres and is open to the north and south and partly to the east and west. At Haimur the trenching confirmed the presence of anomalous gold values in the bedrock where the best intersection was 5 metres at 44.45 g/t. This anomalous gold appears to be closely associated with zones of shearing. The results at Un Garayat were useful, but not so exciting. The company now intends to carry out an RC drilling programme in the remaining months of 2005.
Back at Abbu Dabbab, Gippsland is working on funding the project. Negotiations are at an advanced stage with an unnamed international bank which, as part of its due diligence, has asked the company to carry out a small locked –cycle metallurgical testwork programme to confirm the recoveries of tin and tantalum achieved in previous feasibility study testwork. . Accordingly a 1,800 kg sample has been taken from along the 710 metre length of the three adits through the deposit and this is now being tested in Perth.
The feasibility study completed towards the end of last year decided that production at Abu Dabbab would run at around 650,000 lbs of tantalum pentoxide and 1,530 tonnes of tin/year. These quantities were based on bulk mining and a grade of 261 g/t tantalum pentoxide. What the bank wants to test is by how much production can be increased if head grade is boosted by 10 to 20 per cent by using a bit of grade control. The answer seems to be that production of tantalum pentoxide would increase to 720,000 lbs and tin metal to 1,680 tonnes. This would have a marked impact on the revenue stream and internal rate of return, so the exercise should prove very rewarding. Looks like the company is now on a roll.
Thanks Minews.
d
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