GIP Gippsland

RNS Number:2817H
Gippsland Limited
13 January 2005


13 January 2005

Gippsland Limited ("Gippsland" or "The Company")
___________________________________________________________________________

INCREASED TANTALUM OFFTAKE

On 17 May 2004 the Directors of Gippsland Limited ("Gippsland" or "the Company")
announced that the Company had entered into an off-take agreement for the sale
of 320,000 pounds of tantalum per year over a 4-year period.

The Directors are most pleased to advise that the Company has now entered into a
formal Sale and Purchase Agreement ("Agreement") for an expanded off-take (on a
'take or pay' basis) with the same purchaser ("Purchaser") for a new total of
480,000 pounds of tantalum per year for a fixed period of 5 years. The price of
the tantalum, which has been fixed for the whole of the contract period, will
remain confidential for commercial reasons. The Directors advise that the agreed
price is consistent with that used in the Abu Dabbab bankable feasibility study
completed during November 2004.

Additionally, over the 5-year period, the Purchaser has been granted the first
right of refusal for an additional 70,000 pounds of tantalum per year subject to
such quantities being available for sale. The price for this additional tantalum
off-take is fixed for the 5-year period and is the same as that applicable to
the 480,000 pound yearly off-take.

As previously announced, the Company has also entered into a Heads of Agreement
with a major Asian tantalum consumer for the off-take of 100,000 pounds of
tantalum per year.

Gippsland Chairman Jack Telford stated "With the signing of this Agreement with
one of the global leaders in the tantalum industry, Gippsland has in effect
pre-sold 100% of the Abu Dabbab Project's scheduled tantalum production of
650,000 pounds per year for the first 5 years of business".

The Directors are cognisant of the fact that the execution of this Agreement
represents a major change in the global tantalum industry that has historically
relied largely on tantalum production by Sons of Gwalia Limited which recently
entered into voluntary administration.

The Directors consider that the Abu Dabbab Project's zero domestic revenue tax
regime, low labour costs, a diesel fuel cost of only US$0.09/litre, a mining
strip ratio of 1.1:1 and a 138 million tonne resource base, will ensure that the
Abu Dabbab Project sets the worldwide benchmark for low tantalum production
costs for several decades.

The 40Mt Abu Dabbab project is 100% owned by the Egyptian registered company
Tantalum Egypt, in which Gippsland has a 50% interest by way of an incorporated
joint venture with the Egyptian Mineral Resources Authority (previously Egyptian
Geological Survey & Mining Authority). Tantalum Egypt also owns the Mining
Licence for the 98Mt Nuweibi tantalum deposit located some 17km from Abu Dabbab.

Tantalum (Ta) metal is ductile, easily fabricated, highly resistant to corrosion
by acids. It is an excellent conductor of heat and electricity and has a high
melting point. The major use for tantalum, as tantalum metal powder, is in the
production of electronic components, mainly tantalum capacitors. Major end uses
for tantalum capacitors include portable telephones, pagers, personal computers,
and automotive electronics. Alloyed with other metals, tantalum is also used in
making carbide tools for metalworking equipment and in the production of
superalloys for jet engine components.

R J (Jack) Telford
Executive Chairman

+++++++++++++++++++++++++++++++++++++

For further information please contact:

Jack Telford
Gippsland Limited
Tel: +61 (0)8 9389 8611
jtelford@gippslandltd.com
www.gippslandltd.com

Leesa Peters / Laurence Read
Conduit PR
Tel: +44 (0)20 7936 9095
leesa@conduitpr.com
laurence@conduitpr.com

Bill Sharp / Les Polden
HB-corporate
Tel: +44 (0)20 7510 8560/8576
b.sharp@HB-corporate.com
l.polden@HB-corporate.com

NOTE:
In accordance with Listing Rule 5.10 of the Australian Stock Exchange Limited,
the geological information in this report that relates to mineral resources and
ore reserves is based on information compiled by Gippsland Director Dr John
Chisholm, who is a Fellow of the Australasian Institute of Mining and
Metallurgy, with over 25 years experience in the mining industry




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

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