Nevsun ships gold from Tabakoto

Vancouver — The first shipment of gold produced from the commissioning phase of the Tabakoto open-pit mine in Mali, West Africa, has elevated Nevsun Resources (NSU-T) to the ranks of junior gold producers.

The company began exploring Tabakoto in 1994, and brought the project to feasibility in late 2002. The mine was designed to process ore from the Tabakoto project and the adjoining Segala licence, both situated in western Mali’s Kenieba mining district.

Capital costs were initially projected to be about US$40 million, but increased prices for steel and other materials, mining equipment, labour, and social programs, combined with shipping and other delays, boosted final capital costs to an estimated US$63 million.

The combined Tabakoto and Segala mining operations are expected to produce 100,000 oz. gold annually for at least the next nine years. The open-pittable resources collectively host 1 million oz. gold. Ongoing surface exploration combined with potential for underground mining could extend the mine life, and also possibly expand the operation, which was designed with excess crushing and leaching capacities.

Meanwhile, Nevsun is advancing its Bisha volcanogenic massive sulphide (VMS) deposit in Eritrea, with a feasibility study scheduled for completion in the third quarter of this year. The company plans to arrange debt-financing for the project once the feasibility study is completed. The Bisha project is held 90% by Nevsun, with the government of Eritrea holding the remainder. The project is situated in the Gash-Barka district, about 150 km west of Asmara.

Bisha is somewhat unusual in that the VMS deposit consists of a high-grade-gold oxide cap at surface overlying a high-grade copper supergene massive sulphide deposit, which in turn lies on top of a zinc-copper primary massive sulphide deposit.

A scoping study completed late in 2005 concluded that Bisha has potential to become an economic open-pit mine for at least 10 years. Potential also exists for further production from resources that would be mined by underground methods, and a study to examine this possibility is planned for the future.

The 2005 scoping study concluded that Bisha could produce an estimated 420,000 oz. gold annually in each of its first two years of operation, followed by about 150 million lbs. copper annually from the copper supergene ores over the next three years. The primary massive sulphides could produce about 260 million lbs. zinc and 50 million lbs. copper for each of the subsequent five years.

Silver would be an important by-product throughout, with potential to recover 16 million oz. over the initial 10-year, open-pit mine life.

Mine development at Bisha could begin in 2008. If this target is realized, Nevsun’s projected gold production for that year could rise to an estimated annual rate of 500,000 oz. gold.