Upload
kin-communications-inc
View
32.926
Download
2
Tags:
Embed Size (px)
DESCRIPTION
Nevsun Resources Corporate Presentation
Citation preview
CORPORATE PRESENTATION MAY 2015
Copper Production. Disciplined Growth.
TSX & NYSE MKT NSU
Forward Looking Statements This Presentation contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation concerning anticipated developments on the Company's continuing and future operations in Eritrea, the adequacy of the Company’s financial resources and financial projections. Forward-looking statements include, but are not limited to, statements concerning or the assumptions related to estimates of capital and operating costs, the timing, nature and extent of future copper, zinc and gold production, expanding exploration licenses, the estimation of mineral reserves and resources, methodologies and models used to prepare resource and reserve estimates, the realization of mineral reserve estimates, the conversion of mineral properties to reserves and resources, the potential to expand resources, reserves and mine life, future exploration budgets, plans, targets and work programs, capital expenditures and objectives, anticipated timing of grant of permits, mining and development plans and activities, construction and production targets and timetables, grades, processing rates, life of mine, net cash flows, metal prices, exchange rates, reclamation costs, results of drill programs, dividend plans and policy, litigation matters, integration or expansion of operations, requirements for additional capital, government regulation of mining operations, environmental risks, political risks and uncertainties, unanticipated reclamation expenses, and other events or conditions that may occur in the future. Forward-looking statements are frequently, but not always, identified by words such as "expects," "anticipates," "believes," "intends," "estimated," "potential," "possible", "budget" and similar expressions, or statements that events, conditions or results "will," "may," "could" or "should" occur or be achieved. Information concerning the interpretation of drill results and mineral resource and mineral reserve estimates also may be deemed to be forward-looking statements, as such information constitutes a prediction of what mineralization might be found to be present if and when a project is actually developed, and in the case of mineral reserves, such statements reflect the conclusion based on certain assumptions that the mineral deposit can be economically exploited.
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. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. 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, except as required by law. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. For the reasons set forth above, investors should not place undue reliance on forward-looking statements.
Please see the Company’s Annual Information Form and Management Discussion and Analysis of Nevsun for a more complete discussion of the risk factors associated with our business which have been filed with Canadian securities regulators and are available at www.sedar.com, which have also been filed or submitted to the U.S. Securities and Exchange Commission on Form 40-F or Form 6-K and are available at www.sec.gov .
2
Results driven producer Highly profitable and poised for growth
Low cash cost copper production in 2015
160 -175 million lbs copper in concentrate
C1 cash costs $1.20 to $1.40 per pound1
Robust balance sheet to support growth
≈ $443M USD in cash with no debt
$517M USD in working capital
$0.16 annualized dividend.
≈$100M returned to shareholders since 2011
Growth through exploration & acquisition
Management track record of success
1 As defined by Brook Hunt - see MD&A. All currency in USD unless noted otherwise
D e l i v e r e d 2 0 1 4 R e s u l t s
3
Cu Produced C1 Cost / lb1
Guidance 180 – 200 Mlb Lowest quartile
Actual 196 Mlb $1.05
Q1Q2
Q3Q4
8¢
15¢
13¢
11¢ $462
$498
$519 $520
EPS Working Capital
✓ ✓
4
Maximize value of
Bisha resources
Grow through district
exploration
Diversify through
merger or acquisition
Our Strategy Copper and Zinc Production, Disciplined Growth
A R E S P O N S I B L E A N D S A F E O P E R A T O R
Sustain Dividend
US$0.16 annualized
Capital and operating delivery Built and expanded Bisha on-time and
under budget Deployed over $350 million in capital Operated Bisha 4 years, delivering strong
earnings and cash flow
Exploration success 8 years discovery to production at Bisha
Resource Growth from 2014 drilling
Further Exploration Drilling in 2015
Current resources (effective date Dec 31, 2014) detailed in news release dated Feb 3 2015 Current reserves (effective date Dec 31, 2013) detailed in news release dated Feb 18 2014 and the supporting 43-101 report 5
Track record of success Managing and delivering results
Depletion
Reserve
Reserve
0
5
10
15
Startup Dec 2014
Mine Life, years
B I S H A R E S E R V E L I F E +50%
0
10
20
30
40
50
60
Feasibility Jan 2011 Jul 2012 Dec 2013 Dec 2014
Inferred M&I ResourcesMt
B I S H A D I S T R I C T R E S O U R C E S +65%
6
Operations High grade, modern infrastructure, and exploration potential
0
20
40
60
80
100
120
140
160
180
200
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 20257
Copper Equivalent Payable Production* Copper Zinc Gold Silver
* Dec 31, 2013 43-101 Technical Report 2015-2025 - Cu $2.90/lb, Zn $0.92/lb, Au $1175/oz and Ag $20/oz. Ownership 60% Nevsun and 40% ENAMCO
Copper 640 million lbs
Zinc 1.7 billion lbs
Gold 260,000 oz
Silver 9.3 million oz
LOM Payable Metals*
mm lbs
48%
8% 5%
39%
NSR Revenue
Diversified production for 10+ years Life of mine over 1.3 billion pounds of payable copper equivalent*
Open at Depth 1200 m
475
m
Bisha Main Open Pit
NO
RTH
High-grade copper and zinc Combined Bisha & Harena Reserves (Effective December 31, 2014)
Zone Tonnage Copper Zinc Gold Silver Supergene 3,500 kt 3.68 % 0.60 g/t 23 g/t
Primary 21,600 kt 1.08 % 5.66 % 0.70 g/t 45 g/t
25.3Mt Reserves Based on $2.90/lb Copper, $1.00/lb Zinc, $1160/oz Gold and $18.50/oz Silver
Notes All primary reserves probable category. Supergene is proven
and probable. Qualified person for mineral reserves is Anoush Ebrahami,
Ph.D. at SRK Consulting. Please refer to the 2014 AIF for detailed assumptions
pertaining to the above reserve estimate Total includes small oxide reserve to be processed at end of
mine life.
8
M&I Resource – Underground
Potential
9
Bisha Process Plant
South Bisha Pit North Bisha Pit
Power Plant
Filtration & Concentrate Loadout
Future Zinc Flotation
Copper Flotation
Gold Plant
Mills
9
Workshops
Crusher
Crushed Ore Stockpile
Offices
Fuel Depot
HME Shops
Tailings Facility
Water Ponds
Independence 1993
Politics Single party state
Capital Asmara
Population 6 million (2013 est.)
Culture 50% Islamic / 50% Christian
Currency (Nakfa) Pegged to USD
10
Established in 1998 Nevsun has been working in Eritrea for 17 years
Strong government support Committed to mining industry, has contributed capital, and honored all commitments
Stable taxation and mining regulation for over 20 years
Productive, bilingual, local workforce
Bisha Mine
E R I T R E A
Asmara
To Europe
To Asia
Port of Massawa
ERITREA
Copper Concentrate trucked to Massawa (340 km) for bulk export
Bisha Mine in Eritrea
Modern infrastructure
Power – remotely generated diesel power
Water – bountiful permitted groundwater supply
Roads – simple logistics with high-quality roads and trucking contractor
Port – nearby, modern, state-of-the-art loading
Shipping – via major world trade route
11
Rotainer system installed at Massawa Port meets both the needs for copper concentrate export while setting high environmental standards for mining operations in Eritrea
Zinc expansion project on-track Zinc production starting in 2016
New Zn Con. Thickening
New Zn Flotation
New Zn Con. Storage
S C O P E O F E X P A N S I O N P R O J E C T
> 3.4 billion lbs of Zn contained in M&I resources Currently scoping potential mine-life extensions
> 1.7 billion lbs of Zn payable in P&P reserves $92 million to add zinc flotation, storage and shipping capacity Committed ≈ $63 million. Spent ≈$31 million [Mar 31, 2015]
On-time and budget
300kt supply gap in 2016 and growing in future years Closure of large zinc mines (Brunswick, etc.) cutting 10% of
supply since 2014
Lack of new projects and exploration investment
Source: Metalgesellschaft, Wood Mackenzie and Glencore estimates – Sept 2014 13
Zinc Supply Gap
Existing production and projects under construction
(includes Bisha)
Mine life extensions
Probable projects
F U T U R E Z I N C M I N E P R O D U C T I O N V S S U P P L Y ( M T C O N T A I N E D Z N )
Zinc supply gap going forward Bisha zinc appears well timed with startup in mid-2016
BISHA ZINC
STARTUP
14
Generating sustainable prosperity
Corporate Social Responsibility is central to Nevsun’s business
Prioritization of hiring locals – 89% of the workforce ≈ 1,230 strong Training, training, training Excellent safety record – zero lost time injuries for over three years Independent human rights assessment in 2014
See 2014 CSR Report for more details
Data as at December 31, 2014
15
Bisha District Exploration TSX: NSU | NYSE MKT: NSU
0
20
40
60
80
100
120
140
160
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
De
po
sit S
ize
– m
illio
n t
on
ne
s *
Potential to increase VMS district tonnage through Extending current deposits at depth and on-strike Adding new district deposits; only 4 to-date
16 Number of Deposits in District
Bisha Only 58Mt to date
Noranda District
>200Mt Flin Flon District
>180Mt
5 km Scale VMS District Size
Only 4 Bisha deposits
Flin Flon District
18 deposits Noranda District
25 deposits
District Mine
V M S D I S T R I C T D E P O S I T D I S T R I B U T I O N
Deposit & district growth potential Strategic license position in Bisha District
* Total MI&I resources (current plus mined) for district deposits Source: Company data.
17
NW Zone
Bisha Main
Harena
Hambok
Aderat
Takewuda
17
Map scale is approximate
Bisha VMS district exploration 2014 exploration success 27,000m drilling High grade depth extension at
Harena significantly increased resources
New discovery at Aderat
Camp
NORTH
Favourable Horizon
Felsic Volcanic
Exploration Targets
Bisha Licenses
Current Resource
Plant
Ashelli Mogoraib River License
2015 exploration plans 25,000m drilling budgeted Infill and step-outs at Harena Bisha Main extension and on-strike Underground scoping Bisha &Harena Greenfield targets on Mogoraib River
License – Ashelli and Takewuda
For summary of 2014 Harena results see December 17, 2014 news release and recent 2015 results April 27, 2015. Harena resource statement (red in figure) is described in the 2014 Annual Information Form (AIF)
Currently drilling resource extension targets defined in 2014
Down-hole geophysics indicates extensions of 2014 resource probable
First results extended high grade mineralization in upper and lower massive sulphide zones
Additional high grade gold zone in stringers
18
Harena extension drilling
HX-050: 1.7% Cu, 6.6% Zn, 0.4g/t Au, 28g/t Ag over 67m including
4.6% Cu, 3.4% Zn, 1.0g/t Au, 63g/t Ag over 22m, and
0.2% Cu, 8.2% Zn, 0.1g/t Au, 10g/t Ag over 45m
HX-051: 1.1% Cu, 3.6% Zn, 0.4g/t Au, 22g/t Ag over 74m including
4.2% Cu, 1.2% Zn, 1.0g/t Au, 62g/t Ag over 11m
Harena Pit
HX-051
HX-047 HX-043
HX-039
HX-049
HX-050 Core of Strong Mineralization
HX-044
Harena extension drilling cont’d
Lower zone massive sulphide extended with Hole HX-050 and HX-051
Extends lower zone mineralization 120m down plunge, beyond current resource
Increasing grade and widening Open at depth
For Section A-A and detailed results see new release dated April 27, 2015.
20
Corporate Overview TSX: NSU | NYSE MKT: NSU
Management Cliff Davis, CEO
Tom Whelan, CFO
Frazer Bourchier, COO
Joe Giuffre, CLO
Scott Trebilcock, CDO
Peter Hardie, VP Finance
Peter Manojlovic, VP Exploration
Todd Romaine, VP CSR
21
Strong Bisha Management Team
37% of our on-site senior management are Eritrean
Directors R. Stuart Angus, Chairman
Ian Ashby Cliff Davis Robert Gayton Gary German Gerard Munera
22
Analyst Coverage BA-Merrill Lynch
Canaccord Capital
CIBC
Cormark
Dundee
Haywood Securities Inc.
Paradigm Capital
Raymond James
RBC Capital Markets
Scotia Capital
TD Securities
UBS
As at March 31, 2015
Shares Outstanding 199.7M
Fully Diluted 211.7M
Average Daily Volume >1M
Price at April 30, 2015 C$4.76
Market Cap at April 30, 2015 ≈C$950M
Share Structure
Significant Share Holders Blackrock ≈ 19%
Vanguard 19%
Franklin Templeton
Geologic
Consensus Target: C$5.381
1. Per Company data as at March 31, 2015
Strong holders & broad coverage
I N V E S T O R R E L A T I O N S
T E L : +1 604-684-6730 T O L L F R E E : 1-866-684-6730 E M A I L : [email protected] W E B : www.nevsun.com
Thank You. TSX: NSU | NYSE MKT: NSU
Contact