GIP Gippsland

RNS Number:0655T
Gippsland Limited
25 October 2005


Gippsland Limited

QUARTERLY ACTIVITY REPORT
Period: July - September 2005
25 October 2005
____________________________________________________________

HIGHLIGHTS

* Approval of Abu Dabbab Environmental Impact Assessment
* Abu Dabbab locked-cycle confirmatory testwork - increase in tantalum
  production.
* Further highly encouraging Wadi Allaqi gold exploration results
* Share placement to UK investors raising #600,000
* Appointment of highly experienced Mining Engineer Director
* Annual Report

(Please note: geological graphics associated with this Quarterly Report may be
viewed in the Investor Relations section of the Gippsland website)
____________________________________________________________

ABU DABBAB ENVIRONMENTAL IMPACT ASSESSMENT

During October 2005 Gippsland Limited ("Gippsland" or "the Company") announced
that the Environmental Impact Assessment ("EIA") for the Company's 40Mt Egyptian
Abu Dabbab tantalum-tin project had been approved by the Egyptian Government's
Environmental Affairs Agency. The EIA was undertaken by the Egyptian environment
group Environics and Dorsch Consult (Germany); the international environmental
engineering group Knight Piesold also made a substantial contribution to the
EIA.

The structure and content of the EIA, undertaken over a period of some 16
months, was completed in accordance with guidelines established by the World
Bank Group which complemented those provided by Egyptian legislation.

The EIA process was conducted in parallel and interactively with project design
work. As a result, potential negative environmental effects were mitigated,
through appropriate design and environmental management, to acceptable levels by
international standards. The EIA included commitments to enhance the numerous
social benefits associated with the project.

The completion of the world-standard Abu Dabbab EIA which, being the first such
environmental study concluded in Egypt, is seen as an historical milestone in
the development of the country's mineral resources.

ABU DABBAB CONFIRMATORY TESTWORK - INCREASE IN TANTALUM PRODUCTION

Gippsland is presently in negotiation with a major international bank in regard
to project finance for the Company's 40Mt Abu Dabbab tantalum-tin project. As
part of the Bank's due diligence, Gippsland has been requested to undertake a
small locked-cycle metallurgical testwork programme to re-confirm the tantalum
and tin recoveries achieved in detailed testwork associated with the feasibility
study completed during November 2004.

Accordingly, a 1,800kg sample collected from along the 710m length of the 3
adits through the deposit is presently being processed in the pilot plant
located in a Perth metallurgical laboratory.

The feasibility study determined that Abu Dabbab would produce some 650,000
pounds of tantalum pentoxide (Ta2O5) and 1,530 tonnes of tin metal per year.
These quantities are based on bulk mining and a grade of 261g/t tantalum
pentoxide.

By applying a small degree of grade control, the head-grade will be increased by
10 - 20% which in turn is expected to increase production to at least 720,000
pounds of tantalum pentoxide and 1,680 tonnes of tin metal per year.

Increased tantalum and tin production will have a marked positive impact on the
project's revenue stream and IRR.

The completion of testwork presently underway in a Perth metallurgical
laboratory to evaluate the recoveries associated with the elevated mill feed
grades has been delayed due to work backlogs at the laboratory however the
testwork is expected to be completed and reported to the market by mid November
2005.

HIGHLY ENCOURAGING WADI ALLAQI GOLD EXPLORATION RESULTS

During June 2005 the Company announced most encouraging Wadi Allaqi gold
exploration results work undertaken in the Company's Wadi Allaqi tenements
located to the south-east of Aswan in Egypt. This initial programme was extended
by further exploration undertaken during August 2005 the results of which
further emphasise the high prospectivity of the areas being explored.

At Seiga further sampling delineated a mineralised up to 50m in width.

Seiga        50m wide mineralised zone now containing
             20m @ 7.40g/t Au and 20m @ 2.83g/t Au
             15.5m @ 9.25g/t Au
             4.5m @ 6.69g/t Au
             11m @ 10.29g/t Au


This particular zone of mineralisation extends over more than 250m in length
whilst being open to the north and the south and open in part to the east and
the west.

Mechanical trenching undertaken at Haimur delineated a mineralised zone 5m wide
containing 44.45g/t Au.

Sixteen trenches totalling 1,540.5m were completed using a mechanical excavator
at Haimur and Um Garayat.

The exploration results complement the highly encouraging geochemical sampling
results announced in May and June 2005.

SEIGA (GOLD)

Rock chip sampling in May 2005 at Seiga identified a 34.5m wide zone of gold
mineralisation across old workings which included 20.3m at 7.40g/t and 8m at
7.7g/t (CP1). A 20m shallow trench (CP2) located immediately to the west of the
rock chip profile returned 20m at 2.83g/t further extending the width of the
previously identified mineralised zone to 50 m.

Rock chip sampling and shallow trenching along a profile 70m to the north (CP6)
returned 15.5m at 9.25g/t. The profile included 4.5m at 6.69g/t on the western
side of some old 4.5m wide workings plus 11m at 10.29g/t on the eastern side
where the sampling profile ended.

Three profiles consisting of rock chip sampling and shallow trenching were
completed to the south of CP1 at a spacing of between 40 and 77m. The results
although lower than those in profiles CP1, CP2 and CP6 are most encouraging and
include 16m at 0.97g/t in CP3, 8m at 1.58g/t in CP4 and 8m at 1.55g/t in CP5. A
profile located 500m to the north returned a best value of 5m at 0.12g/t.

The trenching programme determined that the gold mineralisation extends over a
length of 250m and is open to the north and south and in part to the east and
the west.

UM GARAYAT (GOLD)

A trench 55m long tested the northern extension of the historical workings under
the Wadi sediments with a best result of 5m at 0.26g/t Au within sheared
bedrock. At Block A located 1.5km to the north a single trench returned 7m at
0.76g/t Au at the eastern end of the trench.

HAIMUR (GOLD)

A mechanical excavator was used to dig thirteen trenches at Haimur to test
regolith gold anomalies identified during the previous exploration sampling
campaign in May 2005 and the along strike extensions of historical workings at
Haimur South. The trenching results confirmed the presence of anomalous gold
values within the bedrock with a best intersection of 5m at 44.45g/t in trench
HT9. The results are considered to be very encouraging as they confirm the
presence of anomalous gold in the bedrock closely associated with zones of
shearing.

FURTHER EXPLORATION

The Company considers the above Wadi Allaqi gold exploration results to be
highly encouraging and compound the outstanding results announced during June
2005.

The Company is currently arranging to expedite the delivery of a multi-purpose
drill rig to Egypt to commence the drilling programme planned during the last
quarter of 2005.

The Directors anticipate that further exploration at Wadi Allaqi will greatly
expand the presently delineated gold mineralised zones, a number of which have
obvious potential for extensive zones of gold mineralisation.

SHARE PLACEMENT - FUNDRAISING #600,000

During October 2005 the Company completed the placement of 15 million Ordinary
Shares to UK investors at a price of 4 pence (approximately 9.33 Australian
cents) per share raising the sum of UK#600,000 (approximately A$1,400,000)
before costs.

The funds raised will in the main be employed to develop the Company's Egyptian
projects in particular the Wadi Allaqi gold projects, new project initiatives
and working capital.

APPOINTMENT OF MINING ENGINEER DIRECTOR

During the quarter the Directors announced the appointment to the board of
highly regarded mining engineer John Dunlop.

John SF Dunlop (aged 55) holds Bachelors and Masters Degrees in Mining
Engineering from the University of Melbourne. He is a certified Mine Manager
having approximately 35 years of international surface and underground mining
experience in a variety of base metal, industrial and precious metal production
and management situations. He is a Director of the Australasian Institute of
Mining and Metallurgy (AusIMM) and Vice Chairman of its affiliate, the Mineral
Industry Consultants Association (MICA).

Mr Dunlop is a highly experienced mining professional having been involved in
the design, construction and on-going operation of a number of major resource
projects throughout the world. He has a detailed knowledge of the Company's 40Mt
Abu Dabbab tantalum project in Egypt having been involved in the preparation of
the project's Bankable Feasibility Study completed during November 2004.

His appointment is part of the Company's plans to expand its team of highly
skilled mining professionals to implement the development and subsequent
operation of the Abu Dabbab project which is scheduled to become the world's
second-largest tantalum producer.

ANNUAL REPORT

The Gippsland 2005 Annual Report, which has been mailed to shareholders, is
available in a digital format in the Investor Relations section of the Gippsland
website www.gippslandltd.com.

For further information please contact:

Jack Telford
Executive Chairman
Gippsland Limited
www.gippslandltd.com
jtelford@gippslandltd.com

Les Polden
HB-corporate
Tel: +44 (0)20 7510 8565
L.Polden@HB-corporate.com

Leesa Peters
Conduit PR
Tel: +44 (0)20 7618 8708
leesa@conduitpr.com

Note: In accordance with Listing Rule 5.6 of the Australian Stock Exchange
Limited, the geological information in this report that relates to Exploration
Results, Mineral Resources and Ore Reserves is based on data compiled by Dr John
Chisholm, a Fellow of The Australasian Institute of Mining and Metallurgy. Dr
Chisholm who is an Executive Director of Gippsland Limited and a principal of
Continental Resource Management Pty Ltd, with over 25 years experience in the
mineral industry including the evaluation of exploration data, mineral resources
and ore reserves, has consented to the issue of the information in this report
in the form and context in which it appears.




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

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