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From: Biniam Tekle (biniamt@dehai.org)
Date: Wed Aug 10 2011 - 18:24:11 EDT
http://www.miningweekly.com/article/nevsun-reports-60m-q2-profit-from-eritrean-mine-2011-08-10
Nevsun reports $60m Q2 profit from Eritrean mine
By: Matthew Hill
10th August 2011
Updated 1 hour 15 minutes ago
TORONTO (miningweekly.com) – Nevsun Resources, the owner of the Bisha gold
mine in Eritrea, on Wednesday posted second quarter after-tax net profit of
$60,6-million, compared with a $2-million loss for the same period in 2010.
Production came in at 93 000 oz at a cash cost of $301/oz, with an average
realised sales price of $1 510/oz, the TSX-listed company said.
The Bisha mine reached commercial production in late February and the June
quarter was the company's first full quarter of production.
Nevsun said it had $187-million in cash at the end of June, and did not need
to raise money in the near term.
In 2007, the company signed an agreement with Eritrean State-owned Eritrean
National Mining Corporation that government the government a 10% free
ownership of the Bisha mine, and a 30% paid-for stake.
The companies have been negotiating on the price that Eritrea will pay for
the 30% ownership, and Nevsun said it expects this to be finalised before
the third quarter is through.
NEvsun had previously said the price would be decided by June 30.
Although it has started off as a gold and silver producer, Nevsun will start
producing copper from Bisha in 2013, followed by zinc output a few years
later.
Shares in Nevsun closed 6% higher in Toronto at C$6.30, valuing the company
at C$1.2-billion.
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