RNS Number : 1563W
  Gippsland Limited
  06 June 2008
   
    CORRECTION- THE FOLLOWING RNS REPLACES RNS NUMBER 1168W RELEASED AT 7AM THIS MORNING. ATTENTION IS DRAWN TO THE HEADLINE THAT STATES
OPERATING COST SAVINGS OF US$5M PER YEAR RATHER THAN US$18M AS PREVIOUSLY STATED. 


    6 June 2008
    ABU DABBAB PROJECT UPDATE

    *     Plantsite to relocate to within 1km of the open pit mine
    *     Relocation and use of seawater provides significant financial benefits including operating cost savings of approximately US$5
million per year over the likely 20-year Abu Dabbab mine life

    
    Gippsland Limited ("Gippsland" or "the Company") [ASX/AIM/Plus: GIP, DB: GIX] is pleased to provide the following update with respect to
the Company's 40 million tonne Abu Dabbab tantalum-tin project which is expected to become a major supplier to the global tantalum
industry.

    PLANTSITE - RELOCATION

    In the original design, the Abu Dabbab plantsite was situated 5km from the Red Sea coast and 20km from the minesite. This design
entailed the installation of a large seawater desalination plant from which waste brine was to be injected into saline coastal aquifers at a
depth of approximately 200 metres.  As mentioned in the last announcement, the Company's on-going technical review process has resulted in a
number of significant benefits to the project, including the use of raw seawater for the majority of the process flowsheet. Desalinated
water will now only be required for the final stages of the process. 

    The use of seawater will result in a capital cost saving of approximately US$4 million and an operating cost saving of approximately
US$900,000 per year or US$18 million over the likely 20 year Abu Dabbab mine life.

    As a result of the recent decision to utilise seawater for the process plant, the injection of waste desalination brine becomes
unnecessary which in turn enables the plantsite to be relocated within 1km of the open pit mine.  This change will reduce the 2 million
tonne per year ore haulage distance by some 19km, thereby eliminating the need for a heavy haulage road fleet whilst reducing haulage costs
by approximately US$4 million per year. The road between the mine and the Red Sea coast will now become an access road that does not need to
cater for use by heavy ore haulage vehicles.

    The new plant site will also shorten the mill feed distance from the Company's 98Mt Nuweibi tantalum deposit located some 16km to the
south of the Abu Dabbab plantsite.  However as Abu Dabbab will have a mine life of approximately 20 years, Nuweibi will not be utilised for
at least a decade.  The relocation of the Abu Dabbab plantsite will not adversely affect the scheduled 2010 commencement of tantalum and tin
production.


    RJ (Jack) Telford
    Executive Chairman 
    Gippsland Limited
    www.gippslandltd.com 

      For further information please contact:

 Jack Telford
 Gippsland Limited
 T: +61 8 9340 6000
 E: jtelford@gippslandltd.com  

 Jane Stacey                          Richard Hail
 Investor Relations                   Fox-Davies Capital
 M: +44 792 292 3306                  T: +44 20 7936 5200
 E: jane@conduitpr.com                E: richard.hail@fdcap.com 

 Ed Portman                           Alexandra Carse
 Investor Relations                   Fox-Davies Capital
 M: +44 792 292 3307                  T: +44 20 7936 5200
 E: ed@conduitpr.com                  E: alexandra.carse@fdcap.com 

 Warrick Hazeldine                    Nandita Sahgal
 Investor Relations                   Seymour Pierce Limited
 M: +61 417 944 616                   T: +44 20 7107 8000
 E: whazeldine@purplecom.com.au       E: nanditasahgal@seymourpierce.com 

 Matthew Thomas                       Asa Bridle
 Seymour Pierce Limited               Seymour Pierce Limited
 T: +44 20 7107 8000                  T: +44 20 7107 8000
 E: matthewthomas@seymourpierce.com   E: asabridle@seymourpierce.com 


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