PERTH (miningweekly.com) – ASX-listed Gippsland could start production at its Abu Dabbab tantalum/tin/feldspar project, in Egypt, by 2016, the company reported on Thursday.

Gippsland said that it had signed a conditional financing agreement with Taiwan-based Foxxtel and Egyptian businessman Ashraf Henin for a $7-million financing agreement, which could lead to an almost immediate start of a two-staged development of the Abu Dabbab project.

Gippsland developed the staged development plan, dubbed the 400K plan, after the company was unable to gain traction for the initially proposed two- to three-million-tonne mining and processing development plan for Abu Dabbab, which local advisers attributed to a lack of familiarity with mining and tantalum among Gulf investors.

The initial plan had required a $140-million capital spend.

Under the new 400K plan, some $7-million would be spent to mine and process 360 000 t/y of ore, to achieve a production profile of 92 000 lb of tantalum oxide and 260 t of tin.

In Stage 2 of the development, a further $28-million would be spent to increase production and throughput to 1.4-million tonnes a year to produce around 400 000 lb of tantalum oxide and 960 t of tin metal, as well as one-million tonnes of ceramic grade feldspar over a 25-year mine life.

“The 400K plan opened up all kinds of new investor opportunities and we are very pleased to be working with Henin and gain the benefit of his local expertise to finally establish this business,” said Gippsland MD Mike Rosenstreich.

Gippsland said the $7-million financing transaction with Foxxtel would support project development, and would allow for expansions and optimisations of the Abu Dabbab project, the development of new projects and for possible project acquisitions.

The financing agreement, which would see the investors hold a 50% equity in the Abu Dabbab holding company, would be subject to a due diligence and board approvals.