Analyst: Thomas Jones thomas.jones@t1ps.com 23nd September 2008 020 7562 3371 Gippsland Ltd – Project and Corporate Update. Speculative Buy with 23p Target Price AIM, ASX and Frankfurt listed resource Key Datacompany Gippsland released a project and EPIC GIP corporate update on the 22nd of September providing material comfort on progress made Share 4.375p Price in developing its Egyptian tantalum-tin Abu Dabbab project. It also announced the Spread 4.25-4.5p lodgement of three tenement applications in Total no 306.4 million Eritrea in North Eastern Africa and stated that of there is no material exposure to US financial shares institutions on the company’s share register. Market £13.4 million Cap The 50% owned Abu Dabbab project in Egypt 12 3.375p-5.125p has a mineral resource of 44.5 million tones at Month average grades of 250g/t Tantalum and 0.09% RangeTin, of which 30.24 tonnes is in the reserve Net £0.5 million (est) category at 255 g/t tantalum and 0.109% tin. Cash Gippsland believes the current instability in NMS 10,000 global financial markets will not have a detrimental impact on the project financing of Market AIM Abu Dabbab, with negotiations with KfW Website www.gippslandltd.com Bankengruppe well advanced. KfW is currently conducting legal due diligence on the project, Sector Mining and Gippsland is confident of a positive Contact Jack Telford – outcome shortly. The company has also been Executive Chairman negotiating with a number of engineering Tel: +61 8 9340 6000 groups in relation to Abu’s EPCM (Engineering Procurement Construction Management) contract. The process, which began 3 months ago, is expected to result in the appointment of the successful applicant by the end of October. Finally, the company is relieved to report that Abu’s tantalum product is not radioactive according to IMO (International Maritime Organisation) class 7 standards. Combined U308 and Th02 levels will be well below the standard’s 0.1% threshold, which – if crossed - severely restricts the transportation of radioactive material. Gippsland’s 100% owned subsidiary Nubian Resources Plc has applied for three prospecting licences in the North of Eritrea. Each licence is approximately 100 square kilometres in area and, having been identified from satellite imagery, appear prospective for base metal mineralization. Eritrea has recently seen a number of large base metal and gold deposits discovered, with Nevsun Resources Ltd, Sunridge Gold Corporation and Sub- Sahara Resources NL each holding valuable projects. Nubian’s application is expected to be granted during October. In an effort to quantify Gippsland’s exposure to potentially financially unstable US-based institutional shareholders, the company recently evaluated its share register. Apart from the S&P AAA rated World Bank Group’s International Finance Corporation based in Washington holding of 8.16%, directors believe there are no other US-based institutional shareholders of Gippsland. Gippsland continues the steady march towards production at Abu Dabbab, and while not mentioned in the release, the 98 million tonne tantalum Nuweibi project has almost double the ore of Abu. A mere 16 kilometres south of the Abu plant site, Nuweibi will receive greater attention once Abu is operational. The application for new licences demonstrates the company is looking to fill its project pipeline, while the investigation into its US shareholder exposure, although cautious, is further evidence of a company covering all bases. While markets are currently cautious on pre-production mining companies Gippsland shares may trade sideways for a while, however we believe there is a solid investment case underpinning a valuation of 23p per share and as such, at 4.375p, we maintain our stance of speculative buy. Forecast Table Year to 30th Sales (A$ Pre-tax Profit Earnings Per Price Dividends Per Dividend Jun Million) (A$ Million) Share (cents) Earnings Share (p) Yield (%) Ratio 2006A 0.03 (3.65) (1.98) NA 0 0.0 2007A 0.14 (4.19) (1.77) NA 0 0.0 2008E 0.10 (5.00) (1.63) NA 0 0.0 2009E 0.10 (6.25) (2.04) NA 0 0.0 This research note cannot be regarded as impartial as GE&CR has been commissioned to produce it by Gippsland Ltd. The information in this document has been obtained from sources believed to be reliable, but cannot be guaranteed. Growth Equities & Company Research is owned by t1ps.com Ltd which is commissioned by companies to produce research material under the Growth Equities & Company Research label. However the estimates and content of the reports are, in all cases, those of t1ps.com Ltd not of the companies concerned. t1ps.com Limited is regulated by the Financial Services Authority .This research report is for general guidance only and t1ps.com Ltd cannot assume legal liability for any errors or omissions it might contain. The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not necessarily a guide to future performance. The difference between the buy price and the sell price for smaller company shares can be significant. Before investing, readers should seek professional advice from a Financial Services Authority authorised Stockbroker or Financial Adviser. t1ps.com limited can be contacted at 5-11 Worship Street, London, EC2A 2BH - email thomas.jones@t1ps.com - fax 020 7628 3815 - tel 020 7562 3371