Been busy looking at information connected to the most likely cause (in my view) of recent delays.
Hopefully i can upset both people who think Abu Dabbab will never get off the ground and those who think there has been no delay (joke).
As far as i can see it is down to the "borefield" or "wells". Really boring in other words but it seems likely this is what has delayed things.
Hopefully it will be water under the bridge soon if not already and Gip can start making progress before too may people bail out.
05/06/09 http://www.asx.com.au/asxpdf/20090605/pdf/31hyb5ygxdcd9r.pdf BOREFIELD RE-ALLOCATION The Abu Dabbab process plant will consume approximately 6,000m3 of water per day which was to have been sourced from a borefield set back from the Red Sea shoreline by approximately 1km. Recent evaluation of the area proposed, cast doubt on this area's ability to produce the required volume of water.
The Company is pleased to advise that the Company's joint venture company Tantalum Egypt has now been allocated a prime 8.75ha waterfront property which guarantees access to an unlimited quantity of water. The new borefield, which has a Red Sea waterfrontage of 350m, is ideally suited for the project's desalination plant and long-term seaside accommodation facilities for Tantalum Egypt employees.
DESALINATION PLANT TAILINGS STORAGE FACILITY It was proposed that the Abu Dabbab project utilise raw seawater for the process plant and a HDPE lined tailings storage facility ("TSF") to prevent salt water from entering into the scant Wadi Abu Dabbab underground water system.
Recent re-evaluation of the capital and operational costs for the TSF and the desalination plant determined that it will now be more economic to use desalinated process water and an unlined TSF. The use of desalinated water will also largely eliminate environmental risk of groundwater contamination.
The Company's engineers are presently updating the EIS and the DFS to reflect the relatively minor changes associated with the use of an unlined TSF and desalinated water.
Description: Tentalum Egypt SAE, placing a public petition in the media to the concerned authorities to issue the last required approval to enable proceed with project implementation.
Tentalum Egypt SAE a joint venture between Gypsland of Australia & the Egyptian co. for mineral wealth, affiliated to the ministry of petroleum & minerals placing a public petition in the media to the concerned authorities to issue the last required approval to enable proceed with project construction & implementation. Approval pertains to the withdrawal of water from wells close to the red sea at Adu Dab birth.
Project aims at the exploitation of up to 44.5 million tons of tantalum raw materials, also raw zinc and feldspar reserves for export abroad. Project studies show that the projects's foreign currency revenues over the first 10 years of operation would exceed L.E 5.4 billion.
Project has also obtained license of the ministry of state for environment. A quarter page (paid) announcement contains most interesting facts & figures on the project & its proven feasibility.
11/12/09 CSO1 http://www.hotcopper.com.au/post_single.asp?fid=1&tid=1062994&msgid=5920964 I can't find any reference in the sources supplied using simple searches either. The supposed issue doesn't make a lot of sense (GIP has reported there will be no camp as the staff will be located on the coast in tourist accommodation and that the mining can be done using sea water), notwithstanding that water supply was one of the things the Germans were naturally interested in for loan purposes.
If there is a transparency or unpublicised change of plan issue, blame the new chairman, Gandel. Here's why:
(1) As chairman, JT wrote the 2008 annual report and made it clear the water issue had been dealt with satisfactorily:
"One major improvement in the flowsheet process has been the identification that the plant process can be successfully operated using raw seawater. The utilisation of seawater eliminates the need to produce 6,000 cubic metres per day of potable water by way of a reverse osmosis (RO) plant and enables the plant site to be conveniently relocated to within one kilometre of the open pit mine.
This change will reduce the distance by some 19km over which 2 million tonnes per year of ore will need to be hauled. This will result in a capital cost saving of approximately US$4 million and an operating cost saving of approximately US$900,000 per year, equating to US$18 million over the likely 20 year Abu Dabbab mine life."
(2) Gandel, not JT, wrote the 2009 chairman's report as part of the 2009 annual report.
"The project was planned for production in 2006 however recent problems with the plant design have forced the project backers to revisit their assumptions. The latest update from Gippsland resources is for commissioning in 2012 with a view to commercial production in 2013 at the earliest."
However, with the development of world class mineral deposits the likes of the Abu Dabbab tantalum-tin-feldspar deposit, and other precious metal deposits, Egypt's mineral wealth is getting noticed on the world stage."
(Reply to a email complaining about Noventa comment they took some time to reply Lol)
Dear Rob,
Thank you for your enquiry. You are quite correct, Gippsland have never made an announcement to the effect of a specific date and I have wrongly attributed the startup date to the company. The original source was from a tantalum industry report Tantalum: Global Market outlook 2008 - 2013 Paumanok Publications 2008 p 29 in a table of estimated production from new mines. The exact text is provided below from 37 of the report.
Egypt-Abu Dabbab
Gippsland (Australian Stock Exchange-listed junior explorer) and the Egyptian government each have a 50% stake in the Abu Dabbab tantalum deposit in Egypt's Central Eastern Desert (also containing feldspar and tin).
The deposit is large and has the capability to become the world's second largest active mine after Wodgina on an annual output basis. Production is expected to exceed 650,000 lbs tantalite annually when at full output achieved in 2012/2013 (estimated).
100% of the first year's output is already assigned to H.C. Starck.
Delays on this project have been noted by the capacitor manufacturers interviewed for this report, due mainly to problems with financing. However, all of the capacitor manufacturers interviewed for this report believe this resource will be turned into an effective mine, although when is anyone's guess.
Gippsland was interviewed for this report, but could give no indication of when the mine would be operational, nor at what price (per pound) the contract with H.C. Starck was signed.
We have since based our view on a more recent tantalum market report by Roskill in 2009; report states that no clear timeline for startup has been provided by the company. Please accept my apology for this error.
The "recent problems" comment however, does not refer to a specific Gippsland release. What I was referring to was the issue surrounding the switch from seawater to de-sal water and the impact that that would have on the project cost and schedule.
We had heard through industry sources that the German bankers were redoing their numbers - capex and opex to take into account the change - this I would have thought was normal for a project backed by debt and would naturally result in further delays.
There was no intention of anything sinister behind this comment other than acknowledgement that these types of projects can prove to be more complicated and therefore time consuming to execute than previously planned.
If you feel my reasoning is in error or that I am missing any material facts I would be more than happy to arrange to have a call with you at a mutually convenient time.
Regards
AR1 Price at posting:
4.0¢ Sentiment: Hold Disclosure: Held
(20min delay)