Copper and Zinc Production, Disciplined Growth. C O R P O R A T E - - PowerPoint PPT Presentation

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Copper and Zinc Production, Disciplined Growth. C O R P O R A T E - - PowerPoint PPT Presentation

Copper and Zinc Production, Disciplined Growth. C O R P O R A T E P R E S E N T A T I O N | J A N U A R Y 2 0 1 7 A Leading Diversi fi ed Mid-tier NSU TSX & Base Metals Company NYSE MKT Forward looking statements This Presentation


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SLIDE 1

C O R P O R A T E P R E S E N T A T I O N | J A N U A R Y 2 0 1 7

Copper and Zinc Production, Disciplined Growth.

TSX & NYSE MKT

NSU

A Leading Diversified Mid-tier Base Metals Company

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SLIDE 2

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

  • pinions of management on the date the statements are made and the Company assumes no
  • bligation 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 Management Information Circular dated May 18, 2016, the Company’s Annual Information Form for the year ended December 31, 2015 dated March 15, 2016 and the latest 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 . Except as otherwise noted herein, Peter Manojlovic, Vice President of Exploration and Frazer Bourchier Chief Operating Officer are Qualified Persons as defined by National Instrument 43-101 and have approved the scientific and technical information concerning Nevsun Resources Ltd. discussed herein.

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SLIDE 3

Copper & Zinc Production, Disciplined Growth.

Bisha copper

copper-zinc mine cashflow

Positive cash flow from 8+ year open pit mine life

High quality production growth in Timok

Upper Zone high-grade copper-gold project Historic mining region with excellent infrastructure

Exploration growth in two mining camps Strong balance sheet to fund growth

Over US$200 million cash & no debt

Management track record of success

$0.16 annualized dividend paid quarterly

Dividend reinvestment option (DRIP)

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A leading diversified mid-tier base metals company

DRIP = dividend reinvestment program (investors can opt for NSU shares instead of cash to increase growth exposure)

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SLIDE 4

Timok Project

High grade copper-gold project

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SLIDE 5

Serbia: great place to build a mine

Close proximity to existing infrastructure, skilled labour and suppliers

Timok Timok Project Project

n Power n Roads n Rail n Water n Bor and

Aurubis smelters

n Ports

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5km from Bor mining and smelting complex; a 40,000 person mining town European quality infrastructure

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SLIDE 6

Timok project: Upper Zone

High grade Upper Zone being rapidly developed Upper Zone

n

Semi Massive Sulphide (“SMS”) à high-sulphidation epithermal pyrite and copper sulphide

35 MT @ 2.9% Cu & 1.7 g/t Au

INFERRED MINERAL RESOURCE

1.7 MT @ 13.5% Cu & 10.4 g/t Au

INDICATED MINERAL RESOURCE

n

Subject of the April 2016 Reservoir Minerals PEA5

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$US1.5B $US1.5B NPV at $3.00 per lb Cu and $1200 per oz Au

n

12 year mine 12 year mine life life with sub-level open stoping and

conventional copper flotation processing n

Nevsun owns 100% of Upper Zone project

  • 1. The cut-off grade used for the estimate is 0.75% Cu.
  • 2. All figures are rounded to reflect the relative accuracy of the estimate.
  • 3. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability.
  • 4. Mineral Resource is given on 100% basis.
  • 5. The Mineral Resources and the associated PEA were reviewed and approved by Martin Pittuck of SRK Consulting (UK) Limited, a Qualified Person under National Instrument 43-101, details of which can

be found on SEDAR and the Nevsun website. The PEA is preliminary in nature and it includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Mineral resources that are not mineral reserves do not have demonstrated economic viability. There is no certainty that the PEA will be realized. For details see Reservoir Minerals press release April 19, 2016 and associated Technical Report on Nevsun’s website.

U P P E R Z O N E B L O C K M O D E L C O P P E R G R A D E D I S T R I B U T I O N

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SLIDE 7

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Timok project: next steps

Pre-feasibility study Upper Zone

Nevsun is rapidly advancing a Pre- Feasibility study ("PFS") for the Upper

Zone.

Key next steps for the project are:

n

PFS targeted to be completed in September 2017

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50,000 metres of drilling

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Decline targeted to start later in Q4 2017

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Production mid-2020 to mid-2021

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~ $35 million spend in 2017

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SLIDE 8

RECENT UPPER ZONE DRILL RESULTS BIG INTERSECTIONS & GRADE

n 182m @ 4.2% Cu + 4.8 g/t Au n 86m @ 9.5% Cu + 8.8 g/t Au n 99m @ 9.8% Cu + 8.9 g/t Au n 171m @4.9% Cu + 5.2 g/t Au

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SLIDE 9

Bisha Mine

High grade, modern infrastructure, and exploration potential

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SLIDE 10

Independence 1993 Politics Single party state Capital Asmara Population 6 million (est.) Culture 50% Islamic / 50% Christian Currency (Nakfa) Pegged to USD

n Established in 1998

Nevsun has been working in Eritrea for 19 years

n Strong government support

Committed to mining industry, has contributed capital, and honored all commitments

n Stable taxation and mining

regulation for over 20 years

n Productive, bilingual, local

workforce

Copper Concentrate trucked to Massawa (340 km) for bulk export

About Eritrea

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SLIDE 11

20 40 60 80 100 120 140 160 180 2017 2018 2019 2020 2021 2022 2023 2024 2025

Copper Equivalent Payable Production*

Copper Zinc Gold Silver

*Dec 31, 2013 43-101 Technical Report 2017-2025 payable production - Cu $2.90/lb, Zn $0.92/lb, Au $1175/oz and Ag $20/oz.. Updated annual resource and reserve statement in Q2 2017. Ownership 60% Nevsun and 40% ENAMCO (Eritrean National Mining Company).

Copper 365 million lbs Zinc

1.7 billion lbs

Gold

221,000 oz

Silver

7.6 million oz

LOM Payable Metals*

mm lbs

Diversified production (Bisha mine only)

Life of mine over 1.0 billion pounds of payable copper equivalent*

47% 41%

NSR Revenue

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2017 Outlook mid-February 2017

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SLIDE 12

Northwest

Bisha Mine Harena Mine

Hambok T akewuda

Map scale is approximate

Bisha VMS district

Camp

NORTH

Plant

Asheli Aderat Shabayt

Current Mining Licenses Mining Agreement Area Tabakin Exploration License New Mogoraib River Exploration License Mines Deposits High Priority Targets Target Trend / Horizon Felsic Volcanic

Objective: T

  • Extend Life of Bisha Mill

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Focus in 2017 on: expanding Harena & Asheli resources and advancing underground studies

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Defining high priority targets on new larger exploration licenses

District Exploration Success

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Discovered 4 additional satellite deposits

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Continuous resource growth since 2012

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Large deposit being defined beneath Harena reserve

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SLIDE 13

As at Dec. 31, 2016 unless otherwise indicated

Shares Outstanding ≈301M Fully Diluted ≈312M Market Cap ≈C$1.3B* Cash ≈US$218M** No Debt

Share Structure NSU Analyst Coverage

n

Canaccord

n

Dundee

n

Macquarie

n

Paradigm Capital

n

RBC Capital Markets

n

Scotia Capital

n

TD Securities

NSU Shareholders

n

Blackrock ~ 17%

n

Vanguard ~ 12%

n

>70% institutional ownership

Strong holders & broad coverage

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* As at January 5, 2017 ** As at September 30, 2016

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SLIDE 14

Strong Site Management Teams

Experienced leadership

Management

Cliff Davis, CEO Frazer Bourchier, COO Joe Giuffre, CLO Scott Trebilcock, CDO Tom Whelan, CFO Peter Manojlovic, VP Exploration Todd Romaine, VP CSR Peter Tam, VP Finance

Directors

  • R. Stuart Angus, Chairman

Ian Ashby Geoff Chater Cliff Davis Gary German Ian Pearce Stephen Scott David Smith

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SLIDE 15

I N V E S T O R R E L A T I O N S

TEL:

+1 604-623-4700 | 1-888-600-2200

EMAIL:

ir@nevsun.com

WEB:

www.nevsun.com

TSX: NSU | NYSE MKT: NSU

Contact

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