Hi All,
It looks like Nevsun is in hot water today after announcing its 2012 out
look which is lower by about 50%. They may have just lost all credibility
with investors. This is the hard part of investing; knowing when to get
out. I would get out now and wait for the dust to settle. there might be
some lawsuit coming against the company which will keep pressure on the
stock price for a while.
Here is the report.
Nevsun 2012 Outlook Including Production Guidance**
NCOUVER, BRITISH COLUMBIA--(Marketwire -02/07/12)- Nevsun Resources Ltd.
(TSX: NSU.TO <
http://finance.yahoo.com/q?s=nsu.to> -
News<
http://finance.yahoo.com/q/h?s=nsu.to>)(AMEX:
NSU.TO <
http://finance.yahoo.com/q?s=nsu.to> -
News<
http://finance.yahoo.com/q/h?s=nsu.to>)
-
2012 OUTLOOK HIGHLIGHTS FOR BISHA
-- Gold production guidance for 2012: 190,000 to 210,000 ounces
-- Focus on delivering copper plant and infrastructure build on-schedule
and budget
-- Q2 release of updated resource & reserve statements including additions
from Harena, hanging wall copper and primary infill drilling
-- Continue exploration for organic growth on Bisha licences
Nevsun Resources Ltd. (TSX: NSU.TO <
http://finance.yahoo.com/q?s=nsu.to> -
News <
http://finance.yahoo.com/q/h?s=nsu.to>)(AMEX:
NSU.TO<
http://finance.yahoo.com/q?s=nsu.to>-
News <
http://finance.yahoo.com/q/h?s=nsu.to>) today announces its 2012
outlook for planned gold production of 190,000 to 210,000 ounces from the
Bisha mine in Eritrea. The Bisha mine is one of the highest grade open pit
base metal deposits in the world and has a mine life in excess of 12 years.
Nevsun's outlook includes production from the Bisha Main oxide reserve,
stockpiles and Harena oxide. It does not include any production from the
much larger and more valuable supergene and primary zones, which sit
beneath the oxide zone cap and are scheduled to be brought into production
in 2013.
2011 Review - Milestones Achieved
-- Commercial production declared on-schedule and under budget
-- Produced 379,000 ounces of gold
-- Declared inaugural dividend of $0.03 per share and a second semi-annual
dividend of $0.05 per share
-- Finalized project purchase price with the State of Eritrea
-- Completed three major resource expansion drilling programs
-- Accumulated cash position of $347 million
-- Capital investment recovered in first year
2012 Outlook - Objectives Planned
-- Deliver revised oxide gold production plan
-- Continue paying semi-annual dividends
-- Obtain new Mining License for Harena deposit
-- Mine Harena oxide gold resource
-- Deliver resource & reserve re-statement in Q2 or early Q3
-- Manage copper phase project on-time and budget
-- In-fill drill and resource estimation of the Northwest Zone satellite
deposit
-- Commence Bisha regional generative exploration program
Cliff Davis, Nevsun CEO commented, "Bisha had an excellent 2011 operating
year, achieving its gold and cost per ounce production objectives. For
2012, Bisha has the team and contractors in place to successfully execute
the copper phase expansion project so that copper production can start in
mid 2013."
Oxide Gold Reconciliation
Based on actual production data from 2011, Nevsun has reconciled its 2011
ore control model with the March 2011 resource model at Bisha and has
concluded that the resource estimate used for mine planning over-estimated
gold in portions of the Bisha Main oxide mineralization. The new production
forecast includes approximately 1.3 million tonnes at 5.1 grams per tonne
gold of the remaining 1.6 million tonnes of Bisha Main oxide. This compares
with 2.5 million tonnes that was previously expected. Accordingly, the
ounces to be produced in 2012 are about half of what Nevsun was previously
expecting. In context, per the March 2011 technical report, the change
represents a reduction of approximately 4% in Bisha's total reserve
tonnage, after taking into account that Bisha also has a proven and
probable supergene and primary reserve of 23.7 million tonnes, including
3.9% copper in 7.4 million tonnes of supergene and 5.4% zinc in 16.3
million tonnes of primary.
Company staff and a newly appointed independent engineering firm have
conducted thorough investigations of the oxide part of the deposit.
Nevsun now expects to disclose a revised reserve estimate for the entire
Bisha and Harena deposits during the later part of second quarter of 2012
or early third quarter 2012. The time delay from previous guidance is due
to the rigorous review process that has commenced using new independent
engineers, incorporating actual mine data and data from the extensive 2011
drilling program.
Nevsun remains on track with development of the copper phase process plant
at Bisha in advance of commercial copper production in 2013. While
production for 2012 is lower than previously expected, Nevsun believes that
the cash flow generated this year from the oxide deposit will be more than
sufficient to fund the copper plant to completion.
Oxide production is expected to continue in early 2013 followed by
commissioning of the copper flotation plant for start of copper concentrate
production in mid-2013. The decommissioned CIL plant will be mothballed
on-site in a condition for future restart should additional oxide gold
resources be discovered in the Bisha region.
Bisha remains a very robust operation with at least a decade of high-grade
reserves. Bisha will continue to focus on further growing, developing and
operating this world class asset as it continues to build a stronger
business.
Frazer Bourchier, BASc, MASc, PEng, Chief Operating Officer of Nevsun, a
qualified person under National Instrument 43-101, has reviewed and
approved the contents of this news release.
Conference call:
The Company will hold a conference call on Tuesday, February 7 at 5:30AM
Vancouver / 8:30AM Toronto, New York / 1:30PM London. The passcode required
is 7148175 and the dial-in details are as follows:
North America: 416-340-2217 / 1 866-696-5910
UK: 800-8989-6336 (toll free)
Other International: +1 416-340-2217
The conference call will be available for replay until February 14, 2012 by
calling +1 905-694-9451 / 1 800-408-3053 and entering passcode 3428844 or
by visiting our website at www.nevsun.com.
Forward Looking Statements: The above contains forward-looking statements
regarding the 2012 corporate objectives, copper phase development, oxide
resources and reserves, and drilling program results. Forward-looking
statements are frequently, but not always, identified by words such as
"expects," "anticipates," "believes," "intends," "estimated," "potential,"
"possible" and similar expressions, or statements that events, conditions
or results "will," "may," "could" or "should" occur or be achieved.
Forward-looking statements are statements about the future and are
inherently uncertain, and actual achievements of the Company or other
future events or conditions may differ materially from those reflected in
the forward-looking statements due to a variety of risks, uncertainties and
other factors, including, without limitation, those described in the
Management Discussion and Analysis of the Company. The Company's
forward-looking statements are based on the beliefs, expectations and
opinions of management on the date the statements are made and the Company
assumes no obligation to update such forward-looking statements in the
future. For the reasons set forth above, investors should not place undue
reliance on forward-looking statements.
NEVSUN RESOURCES LTD.
Cliff T. Davis, President & Chief Executive Officer
Received on Tue Feb 07 2012 - 19:27:05 EST
