Q4 Activities Report
July 31 2006 - 3:01AM
UK Regulatory
RNS Number:9351G
Gippsland Limited
31 July 2006
31 July 2006
Gippsland Limited ("Gippsland" or the "Company")
Please refer to the ANNOUNCEMENTS section of the Gippsland website
www.gippslandltd.com to view colour geological graphics associated with this
announcement.
Q4 ACTIVITIES REPORT
HIGHLIGHTS
+++++++++++++++++++++++++++++++++++++++++++
40MT ABU DABBAB TANTALUM PROJECT
* IFC A$2.7 million equity investment in Gippsland
* IFC US$3 million equity investment option in Gippsland approved by
shareholders
* Optimisation testwork and final flowsheet nearing completion
OUTSTANDING WADI ALLAQI GOLD EXPLORATION RESULTS
* 4,490 RC drilling completed
* Seiga mineralised zone > 800m in length & up to 75 metres wide
* Shashoba mineralised zone potential strike length of 2.2km & up to 50 metres
wide
APPOINTMENT OF CHIEF FINANCIAL OFFICER
+++++++++++++++++++++++++++++++++++++++++++
US$2 MILLION IFC EQUITY INVESTMENT IN GIPPSLAND
During the quarter Gippsland (ASX & AIM: GIP) announced that the International
Finance Corporation ("IFC"), a member of the World Bank Group, has been mandated
("Mandate") as Lead Debt Arranger for Gippsland's 40 million tonne Abu Dabbab
Tantalum-Tin Project ("Abu Dabbab") in Egypt.
Pursuant to the Mandate conditions, the IFC has exercised an option to subscribe
for US$2M of new fully paid ordinary share equity capital in Gippsland by way of
the issue of 25 million new fully paid ordinary Gippsland shares at a price of
US$0.08 (approx. A$0.108 / UK#0.046) per share to raise US$2 million (approx.
A$2.69 / UK#1.14 million) cash for Gippsland.
The 25 million shares issued to the IFC each have an attaching free unlisted
option having an exercise price of A$0.135 (approx. UK#0.057) and a life of six
(6) years. Gippsland may require the IFC to exercise 12.5 million of these
options in the event that Gippsland shares trade at a weighted average price
equal to or greater than A$0.20 (approx. UK#0.085) for a period of 20 trading
days, or relinquish the 12.5 million options.
The issue of the 25 million shares and 25 million options to the IFC was
approval by Gippsland shareholders at an Extraordinary General Meeting held on
16 May 2006.
FURTHER US$3 MILLION IFC EQUITY INVESTMENT IN GIPPSLAND
Pursuant to the Mandate, Gippsland also granted to the IFC a first right of
participation to invest an additional US$3 million at the time of and on the
same terms as are offered by Gippsland when raising the equity component of the
Abu Dabbab project capital cost. IFC will have 30 days within which to exercise
this pre-emptive right.
The issue of these shares to the IFC was also approved at the Extraordinary
General Meeting of Gippsland shareholders held on 16 May 2006.
ABU DABBAB OPTIMISATION TESTWORK
During the quarter Gippsland completed metallurgical testwork as requested by
the IFC. The testwork, which was designed to ensure minimal over-grinding of the
tantalite in the primary mill, was completed following considerable delay due to
the non-availability of process design engineers. The design of the flowsheet is
presently being adjusted to incorporate the additional gravity equipment in the
milling circuit. It is anticipated that this detail will be presented to the IFC
during August in finalisation of the flowsheet.
WADI ALLAQI GOLD EXPLORATION
During the quarter the company completed a programme of reverse circulation (RC)
drill holes on the Haimur, Seiga, Shashoba and Tiur prospects in the Wadi Allaqi
project located in Southern Egypt. A total of 121 holes were completed for a
total of 4,490m. The drilling represents a major advance in the exploration of
the Wadi Allaqi region as it is the first drilling work to be completed for gold
exploration in Southern Egypt.
Table 1 Summary of drilling completed during the quarter
Prospect Number of holes Metres drilled
------------------ -------------------- -----------------
Seiga 45 1,725
Haimur 31 898
Shashoba 40 1,636
Tiur 5 231
------------------ -------------------- -----------------
Total 121 4,490
------------------ -------------------- -----------------
The 4m composite samples were analysed by Genalysis Laboratory Services in Perth
by Atomic Absorption Spectrometer (AAS). Samples containing greater than 1g/t Au
were re-analysed by Fire Assay (FA).
SEIGA
During the quarter a total of 45 RC holes were completed for a total of 1,725m.
The drilling tested ancient workings and the along strike extensions of these
workings.
Significant results were obtained from a number of the drill holes from beneath
the old workings confirming the high-grade gold results obtained during previous
surface sampling work as well as the shear zone along strike from these
workings. The best results include the following:
Hole CRC004 8m @ 1.73g/t Au
Hole CRC006 12m @ 1.22g/t Au
Hole CRC012 28m @ 4.18g/t Au
Hole CRC013 24m @ 5.21g/t Au
Hole CRC015 12m @ 1.32g/t Au
Hole CRC028 3m @ 1.32g/t Au
Hole CRC029 6m @ 2.15g/t Au
Hole CRC033 12m @ 1.80g/t Au
Hole CRC040 28m @ 1.14g/t Au
Hole CRC041 22m @ 1.74g/t Au
Six of the holes tested the ancient Seiga workings with the best results
obtained in holes CRC012 & CRC013. Hole CRC012 was drilled below the centre of
the ancient workings and intersected 28m at 4.18g/t Au between 28-56m. Hole
CRC006 which was drilled from the opposite direction and slightly to the north
intersected the mineralisation yielding 12m at 1.22g/t Au between 60-72m. Hole
CRC013 drilled at the northern end of the ancient workings intersected 24m at
5.21g/t Au between 48-72m. This zone is thought to correspond with the high
grade mineralisation recorded in earlier surface sampling. Hole CRC011 which was
drilled 20m to the south of CRC012 intersected a zone of low grade
mineralisation (12m at 0.48g/t Au) with associated cavities that may represent
old stopes. Hole CRC004 drilled from the opposite direction intersected 4m at
4.34g/t Au from 68m and 8m at 1.73g/t Au from 84m in the expected position of
the mineralisation.
Drilling of the shear zone along strike from the ancient workings intersected
significant (greater than 0.5g/t Au over 4m) mineralisation at six locations.
CRC015 intersected 12m at 1.32g/t Au 230m along strike to the north of the old
workings. Three surface samples from some shallow pits located between CRC015
and the old workings assayed 0.98, 1.21 & 2.22g/t Au.
Five holes intersected significant gold mineralisation within the shear zone to
the south of the old workings with the best results being 28m at 1.14g/t Au
(CRC040) and 22m at 1.74g/t Au (CRC041) in adjacent holes. Many of the holes
containing significant intersections ended in mineralisation indicating that the
intersection widths are minimum widths that will require additional testing.
Hole CRC040 located 450m along strike to the south-east of the ancient workings
intersected 28m at 1.14g/t Au between 0 to 28m. Hole CRC041 which was drilled
15m to the west of CRC040 intersected 22m at 1.74g/t Au from 8m to the end of
the hole with the last 4m of the hole containing 2.54g/t Au. Hole CRC033 located
300m along strike to the south-east of the ancient workings intersected 12m at
1.80g/t Au from 48m to the bottom of the hole at 60m. Hole CRC028 located 200m
along strike to the south-east of the ancient workings intersected 1.32g/t Au in
the last 3m of the hole at 21m. Hole CRC029 located 15m to the west of CRC028
intersected 6m at 2.15g/t Au at the bottom of the hole at 30m.
Of particular significance are the wide intersections recorded in holes CRC040
and 041 as these two holes are adjacent to each other and indicate a mineralised
zone of at least 25m horizontal width at an average grade of 1.4g/t Au. This
area is located 450m along strike to the south-east of the ancient Seiga
workings.
Significant gold mineralisation has now been confirmed over a strike length of
800m of the Seiga shear. Considerable potential exists beyond the zone tested to
date as significant mineralisation occurs at both ends of the shear. Further
drilling will be required to the north-west and south-east to determine the full
extent of the mineralisation. Drill pads to test a further 700m of the shear to
the north-west have been prepared. Similarly drill pads have been prepared to
test 400m of the shear to the south-east.
SHASHOBA
The Shashoba prospect is located 6.8km to the east of Seiga. A total of 40 RC
drill holes were completed for a total of 1,636m. The drilling tested old
workings and some gold geochemical targets detected during previous exploration
work by the company. The historical workings are located along the margins of a
250m wide, northerly trending shear zone.
The drilling at Shashoba returned significant gold intersections in a number of
holes. These included:
Hole SRC006 32m @ 2.2g/t Au including 16m @ 4.4g/t Au
Hole SRC007 48m @ 1.93g/t Au
Hole SRC008 4m @ 1.33g/t Au
The best results were recorded from the south side of a hill adjacent to
historical workings located on the eastern side of the shear zone. Hole SRC006
intersected 32m at 2.2g/t Au from 16m. The intersection included 16m at 4.4g/t
from 16m. Hole SRC007 drilled 30m to the southwest intersected a 48m wide zone
of mineralisation at 1.93g/t from 12m. Hole SRC008, located 25m southwest of
hole SRC007, intersected 4m at 1.33g/t Au. The three holes intersected a zone of
mineralisation (>0.5g/t Au) approximately 50m wide which has yet to be tested to
the north.
A line of widely spaced shallow holes located 75m to the southeast of holes
SRC006 & 7 tested an area of colluvium overlying a hard silcrete layer. The best
intersections included 8m at 1.06g/t from 4m in SRC017 and 12m at 0.46g/t from
4m in hole SRC018. These intersections are particularly significant as they
confirm the presence of mineralisation to the south of the historical workings
in an area devoid of any previous workings. The drilling results correspond with
a geochemical anomaly identified during a previous regolith survey by the
Company that extends for a further 300m to the south.
Hole SRC012 drilled 100m to the north of holes SRC006 & 7 intersected 24m at
0.26g/t Au. The results represent footwall mineralisation as the hole did not
extend to sufficient depth to intersect the old workings. Hole SRC014 tested
some isolated old workings 500m to the northeast and intersected 20m at 0.94g/t
from 8m with a best intersection of 4m at 3.07g/t Au.
Geological mapping has located historical workings over a distance of 1.9km to
the north which combined with the 300m geochemical anomaly to the south gives a
total strike length of 2.2km of potentially mineralised shear which is open at
each end.
Additional drilling is planned to test a number of high priority targets
identified as a result of the recent drilling programme. While the evaluation of
Shashoba is at an early stage, the area clearly has considerable potential.
TIUR
Five RC holes were completed for a total of 231m to test old workings. Four of
the holes tested the shear zone to the south of the main historical workings
with three of the holes intersecting a thin graphitic zone that represents the
mineralised horizon but did not contain significant gold values. A hole designed
to test the zone directly below the old workings did not reach the target depth
due to drilling difficulties caused by unstable ground around the drill collar.
HAIMUR
The Haimur prospect is situated 180km to the southeast of Aswan. Some 31 RC
holes for a total of 898m have been drilled to date. The total number of holes
to be drilled at the prospect during the current campaign is 46.
The drilling tested some historical workings and a number of geochemical
anomalies identified during a previous geochemical survey and mechanical
trenching. The assays for this work are still being completed.
APPOINTMENT OF CHIEF FINANCIAL OFFICER
During the quarter the Company appointed Mr Paul R Sims (aged 44) as the
Company's Chief Financial Officer.
Mr Sims has an established senior management background in financial and
commercial functions within the resources sector and has held both operational
and strategic roles in major international resource companies. Gippsland
Directors recognise that his strengths in relation to project finance plus the
development and implementation of financial and commercial systems will
contribute significantly to the development of the Company's growth.
Mr Sims forms part of the expanding Gippsland management team being set in place
for the development of the Company's Abu Dabbab tantalum project.
EXTRAORDINARY MEETING OF SHAREHOLDERS
The Extraordinary Meeting of Shareholders held on 16 May 2006 passed all four
resolutions by a show of hands.
RJ (Jack) Telford
Executive Chairman
For further information please contact:
Jack Telford
Gippsland Limited
www.gippslandltd.com
Tel: +61 (0)8 93898611
jtelford@gippslandltd.com
Laurence Read / Leesa Peters
Conduit PR
Tel: +44 (0)20 7429 6605
leesa@conduitpr.com
laurence@conduitpr.com
Les Polden / Luke Cairns
Hoodless Brennan Plc
Tel: +44 (0)20 7538 1166
L.Polden@HBcorporate.com
L.Cairns@HBcorporate.com
Note: In accordance with Listing Rule 5.6 of the Australian Stock Exchange
Limited and Part two of the AIM Guidance Notes for Mining, Oil and Gas
Companies, 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 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
APPENDIX A:
Collar locations of the drilling completed during the quarter
Hole Easting Northing Azimuth (deg) Dip (m) Depth (m)
SEIGA
---------- ---------- ---------- ---------- ---------- ----------
CRC001 616049 2493997 60 -60 36
CRC002 616036 2493989 60 -60 36
CRC003 616019 2493983 60 -60 30
CRC004 616061 2494004 60 -60 102
CRC005 616011 2493970 60 -57 30
CRC006 616038 2494037 60 -58 101
CRC007 616033 2494043 40 -59 84
CRC008 616024 2494032 60 -58 30
CRC009 616009 2494030 60 -58 30
CRC010 615992 2494031 65 -58 30
CRC011 616124 2494046 240 -58 83
CRC012 616105 2494056 240 -58 69
CRC013 616091 2494101 240 -55 90
CRC014 615929 2494277 60 -55 30
CRC015 615915 2494269 60 -58 30
CRC016 615901 2494261 60 -58 30
CRC017 616120 2493962 60 -57 30
CRC018 616108 2493954 60 -57 30
CRC019 616098 2493945 60 -62 30
CRC020 616089 2493932 60 -60 30
CRC021 616199 2493916 60 -55 20
CRC022 616184 2493909 60 -58 30
CRC023 616171 2493900 60 -58 30
CRC024 616159 2493894 60 -56 30
CRC025 616145 2493888 60 -58 30
CRC026 616135 2493881 60 -58 27
CRC027 616120 2493873 60 -58 30
CRC028 616234 2493864 60 -58 21
CRC029 616220 2493857 60 -59 30
CRC030 616202 2493851 60 -59 30
CRC031 616188 2493843 60 -58 30
CRC032 616175 2493839 60 -59 30
CRC033 616250 2493768 60 -60 60
CRC034 616238 2493760 60 -60 30
CRC035 616223 2493751 60 -60 30
CRC036 616211 2493743 60 -60 30
CRC037 616301 2493668 60 -60 30
CRC038 616286 2493654 60 -60 30
CRC039 616263 2493643 60 -60 30
CRC040 616343 2493641 60 -60 36
CRC041 616336 2493641 60 -60 30
CRC042 616323 2493633 60 -60 30
CRC043 616549 2493487 60 -60 30
CRC044 616534 2493478 60 -60 30
CRC045 616517 2493468 60 -60 30
TIUR
---------- ---------- ---------- ---------- ---------- ----------
TRC001 668428 2467347 90 -58 48
TRC002 668446 2467305 80 -72 51
TRC003 668451 2467269 70 -55 51
TRC004 668401 2467399 60 -58 30
TRC005 668446 2467254 90 -54 51
SHASHOBA
---------- ---------- ---------- ---------- ---------- ----------
SRC001 621643 2491105 270 -57 39
SRC002 621646 2491141 275 -57 39
SRC003 621638 2491067 270 -57 39
SRC004 621598 2490972 270 -57 39
SRC005 621589 2490916 50 -56 39
SRC006 621899 2491399 50 -51 60
SRC007 621876 2491383 50 -54 60
SRC008 621862 2491373 50 -55 48
SRC009 621840 2491361 50 -56 51
SRC010 621834 2491425 80 -60 60
SRC011 621834 2491454 65 -60 69
SRC012 621857 2491470 60 -60 81
SRC013 621923 2491387 40 -52 51
SRC014 621965 2491907 300 -55 60
SRC015 621801 2491276 240 -58 21
SRC016 621840 2491286 245 -57 21
SRC017 621862 2491292 245 -57 21
SRC018 621891 2491304 240 -60 21
SRC019 621916 2491313 245 -59 21
SRC020 621946 2491313 245 -59 21
SRC021 621972 2491334 245 -57 21
SRC022 621994 2491339 245 -57 21
SRC023 621606 2491410 260 -58 42
SRC024 621625 2491410 265 -58 42
SRC025 621649 2491410 270 -58 42
SRC026 621668 2491412 265 -61 39
SRC027 621688 2491412 265 -61 39
SRC028 621708 2491413 265 -62 39
SRC029 621695 2491349 260 -58 39
SRC030 621714 2491348 265 -58 39
SRC031 621723 2491347 265 -58 39
SRC032 621754 2491344 265 -58 39
SRC033 621613 2491294 265 -55 39
SRC034 621633 2491298 265 -55 37
SRC035 621655 2491300 270 -57 33
SRC036 621675 2491295 270 -57 45
SRC037 621690 2491293 270 -57 39
SRC038 621713 2491282 260 -58 39
SRC039 621241 2491252 260 -54 51
SRC040 621250 2491166 270 -57 51
HAIMUR
---------- ---------- ---------- ---------- ---------- ----------
HRC001 530607 2502319 150 -60 31
HRC002 530318 2502967 140 -61 21
HRC003 530325 2502958 140 -60 24
HRC004 530331 2502953 140 -59 21
HRC005 530338 2502942 135 -58 21
HRC006 530758 2502749 135 -56 30
HRC007 530717 2502764 130 -57 30
HRC008 530689 2502803 130 -58 30
HRC009 530681 2502822 135 -57 30
HRC010 530887 2502800 140 -58 30
HRC011 530859 2502836 140 -56 30
HRC012 530836 2502866 135 -57 30
HRC013 530812 2502896 140 -58 30
HRC014 530787 2502927 140 58 30
HRC015 530966 2502906 130 56 30
HRC016 530960 2502958 135 58 30
HRC017 530934 2502992 140 59 30
HRC018 530916 2503025 140 58 30
HRC019 530880 2503037 135 57 30
HRC020 531038 2502959 135 57 30
HRC021 531010 2502997 135 55 30
HRC022 530989 2503023 135 57 30
HRC023 531196 2503064 135 55 30
HRC024 531163 2503090 135 57 30
HRC025 531136 2503112 135 58 30
HRC026 531106 2503141 130 58 30
HRC027 531266 2503186 160 56 30
HRC028 531241 2503209 135 57 30
HRC029 531222 2503233 135 53 30
HRC030 531301 2503181 135 57 30
HRC031 531344 2503231 135 56 30
This information is provided by RNS
The company news service from the London Stock Exchange
END
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