Copper and Zinc Production. Disciplined Growth.

Copper and Zinc Production.
Disciplined Growth.
CORPORATE PRESENTATION  June 2016
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 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, Qualified Persons as defined by National
Instrument 43-101, have approved the scientific and technical information concerning Nevsun Resources Ltd discussed herein.
2
Cu & Zn Production. Disciplined Growth.
A leading diversified mid-tier base metals company
Operator of Bisha copper-zinc mine
Cash flow from 9+ year open pit mine life
Zinc start-up in Q3 adds to Cu production
High quality production growth in Timok project
Upper Zone high grade Cu-Au project
- 2015 RESULTS Copper Produced
Cash from operations
136 Mlbs
$120 M
In historic mining region with excellent infrastructure
Exploration growth projects in two mining camps
Strong balance sheet to fund growth
Cash in bank (no debt) >$200 M 2
Dividends paid
$32 M
Major strategic partners
Freeport McMoRan on the Timok Lower Zone
Rio Tinto on Serbian exploration near Timok
1 C1 cash cost as defined by Brook Hunt - see MD&A All currency in USD unless
noted otherwise
2 As at March 31, 2016 $438 million - $135 million for Timok ROFO and $75 million
for RMC acquisition
Management track record of success
$0.16 annualized dividend paid quarterly
3
Nevsun track record of success
Managing and delivering results
Capital and operating delivery



Financial delivery
Built and expanded Bisha on-time and
under budget over 3 phases
Deployed over $420 million in capital
Operated Bisha 5 years, delivering
strong earnings and cash flow
BISHA RESERVE LIFE
+50%


Growth delivery

Continuous resource growth at Bisha
BISHA DISTRICT RESOURCES
60
15
5 years of dividend growth
Returned $130 million to shareholders
Mt
Inferred
+115%
M&I Resources
50
Mine Life,
years
10
Reserve
40
30
5
20
Reserve
Depletion
0
10
0
Startup
Dec 2015
Feasibility Jan 2011
Jul 2012
Dec 2013 Dec 2014 Dec 2015
Current resources (effective Dec 31, 2015) detailed in news release dated Feb 17, 2016. Qualified person is Phil Jankowski BMSC.
Current reserves (effective Dec 31, 2015) detailed in 2015 AIF. Qualified person is Anoush Ebrahimi, Ph.D. at SRK Consulting
4
Our strategy
Copper and Zinc Production, Disciplined Growth
A RESPONSIBLE AND SAFE OPERATOR
Maximize
value of
Bisha
resources
Grow
through
district
exploration
Diversify
through
merger or
acquisition
✔
Sustain
Dividend
US$0.16
annualized
Recent Reservoir
Minerals acquisition
met stated criteria
5
Timok Project
High grade copper-gold project
Serbia and Timok infrastructure
Timok has key characteristics for a successful development

Serbia is a great country to
build a mine:





Working toward EU membership
Long history of mining in Timok project
area (Bor)
Supportive federal government (pro
foreign investment)
Municipality with experienced &
educated labour force
Close proximity to existing
mine infrastructure:






Timok
Project
Power
Roads
Rail
Water
Bor and Aurubis smelters
Ports
7
Timok project Upper Zone
Large, high grade Upper Zone to be developed
UPPER ZONE BLOCK MODEL
COPPER GRADE DISTRIBUTION
Upper Zone

Semi Massive Sulphide (“SMS”)  high sulphidation
epithermal pyrite and copper sulphide
35 MT @ 2.9%Cu & 1.7g/t Au INFERRED MINERAL RESOURCE
1.7 MT @ 13.5% Cu & 10.4 g/t Au INDICATED MINERAL RESOURCE

Subject of the April 2016 Reservoir Minerals PEA5


$US1.5B NPV at $3.00 per lb Cu and $1200 per oz Au
Mine life 12 years with sub-level open stoping and
conventional copper flotation processing

Next step: PFS underway and due in 12-18 mths
Lower Zone
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.
For details see Reservoir Minerals press release April 19, 2016 and associated Technical Report
on Nevsun’s website.



Extensive porphyry style copper-gold mineralization
below the Upper Zone
Block cave mining potential
Potential 15-20 years from production
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.
8
Timok project plan view
Timok footprint on largely agricultural land




5 km from
major mining
and smelting
complex: Bor
Land largely
used for
farming
No significant
structures or
villages
Land
acquisition
underway
Lower Zone
Porphyry
Upper
Zone
9
Bisha Mine
High grade, modern infrastructure,
and exploration potential
Diversified production
Life of mine over 1.1 billion pounds of payable copper equivalent*
Copper Equivalent Payable Production*
Copper
Zinc
Gold
LOMPayable Metals*
Silver
2016 Guidance
mm lbs
180
H1: 40-50 million lbs Cu @ C1 cost $1.20-1.40/lb
H2: 40–60 million lbs Cu plus 70 – 100 million lbs Zn
Stockpile sales 80k – 100k oz gold equivalent
Copper
470 million lbs
Zinc
1.7 billion lbs
Gold
240,000 oz
Silver
8.2 million oz
160
140
120
100
80
60
40
20
0
2017
2018
2019
2020
2021
2022
2023
2024
* Dec 31, 2013 43-101 Technical Report 2016-2025 - Cu $2.90/lb, Zn $0.92/lb, Au $1175/oz and Ag $20/oz. Ownership 60% Nevsun and 40% ENAMCO
2025
11
NORTH
High-grade copper and zinc
Combined Bisha & Harena Open Pit Reserves (Effective December 31, 2015)
Zone
Tonnage
Supergene
870 kt
2.18%
Primary
21,000 kt
1.10%
Copper
Zinc
5.57 %
Gold
Silver
0.56 g/t
14 g/t
0.68 g/t
44 g/t
Notes
1. Supergene 0.2Mt and Primary 0.1Mt proven and
the rest probable
2. Qualified person for mineral reserves is Anoush
Ebrahimi, Ph.D. at SRK Consulting.
3. See 2015 AIF for detailed reserve assumptions
21.9Mt Proven and Probable Open Pit Reserves
Based on $2.74/lb Copper, $0.95/lb Zinc,
$1100/oz Gold and $18.50/oz Silver
475 m
Bisha Main
Open Pit
Underground
Potential
Open at
Depth
Encouraging underground
investigation in 2015
Continued drilling and
investigations in 2016
1200 m
12
Zinc plant completed
Commissioning started June 2016
2.6 billion lbs of Zn in reserves
21.0Mt @ 5.57% zinc probable reserves
$80 million to add zinc flotation and storage

3.5 billion lbs of Zn contained in resources
37.7Mt @ 4.3% zinc , measured and indicated
resources
On-time and under budget
SCOPE OF ZINC EXPANSION PROJECT
New Zn Con.
Storage
Expanded
Zn/Cu Con.
Filtration
New Zn Con.
Thickening
New Zn
Flotation
Notes
1. Qualified person for mineral reserves is Anoush Ebrahimi, Ph.D. at SRK Consulting. See 2015 AIF for detailed reserve tables and assumptions.
2. Qualified person for resources is Phil Jankowski (BMSC), See news release dated Feb 17, 2016 for detailed resource tables and assumptions
13
Bisha Mine in Eritrea

Established in 1998
Nevsun has been working in
Eritrea for 18 years

Strong government support
Committed to mining industry,
has contributed capital, and
honored all commitments
Copper Concentrate trucked to Massawa
(340 km) for bulk export

Stable taxation and mining
regulation for over 20 years
Independence
1993
Politics
Single party state
Capital
Asmara
Population
6 million (2013 est.)
Culture
50% Islamic / 50% Christian
Currency (Nakfa)
Pegged to USD

Productive, bilingual, local
workforce
14
Modern
infrastructure


Power – remotely generated diesel power
Water – bountiful permitted groundwater
supply
Rotainer system installed at
Massawa Port meets both the
needs for copper concentrate
export while setting high
environmental standards for
mining operations in Eritrea

Roads – simple logistics with high-quality
roads and trucking contractor

Port – nearby, modern, state-of-the-art
loading

Shipping – via major world trade route
15
Generating sustainable prosperity
Corporate Social
Responsibility is
central to Nevsun’s
business
 See 2015 CSR Report for more details




Prioritization of hiring locals – 90% of the workforce (total
workforce in Eritrea ≈ 1,342)
Training, training, training
Independent human rights assessment; external audit in Aug 2015
Safety performance exceeding North American industrial metrics
16
Bisha District Exploration
District scale license position
Aggressive district exploration program in 2016
Potential to increase Bisha District VMS tonnage through


Extending current deposit tonnage at depth and on-strike
Adding new district deposits
VMS DISTRICT DEPOSIT SIZE & DISTRIBUTION
District
Open
Mine
5 km
Noranda District
Flin Flon District
Bisha District
25 deposits
18 deposits
4 deposits
*
>200Mt
*
>180Mt
40Mt
measured & indicated resource
See news release dated Feb 17, 2016 for detailed resource tables and assumptions. Qualified person for
resources is Phil Jankowski (BMSC),
Scale
* Noranda and Flin Flon
districts include many
deposits that were
discovered and mined prior
to NI43-101 disclosure
requirements and tonnages
are estimates
Source: Sangster,
Quantitative characteristics
of VMSs and Company data
18
Bisha VMS district exploration
Camp
2016 exploration plan




NORTH
NW Zone
Continue Harena drilling and Asheli
Drill Bisha Main targets at depth
Greenfield exploration on Mogaraib
Budget $11 million including ~34
km of drilling
Plant
Bisha Main
Favourable Horizon
Felsic Volcanic
Exploration Targets
Aderat
Bisha Licenses
Harena
Asheli
Current Resource
Map scale is
approximate
Hambok
Mogoraib River License
2015 success
Takewuda



New discovery at Asheli
Extended Harena to 600m depth
increasing resources
Positive internal scoping of
underground mining potential
19
Corporate
Overview
TSX: NSU | NYSE MKT: NSU
Strong Bisha
Management Team
Management
Directors
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
R. Stuart Angus, Chairman
Ian Ashby
Geoff Chater
Cliff Davis
Robert Gayton
Gary German
Gerard Munera
Stephen Scott
35% of our on-site senior
management are Eritrean
21
Strong holders & broad coverage
NSU Analyst Coverage

Canaccord Capital

CIBC

Cormark

Dundee

Haywood Securities Inc.

Paradigm Capital

Share Structure
June 20, 2016 1
Shares
Outstanding
≈300M
Fully Diluted
≈313M
Price 2
C$3.80
Market Cap
≈C$1.1B
Raymond James
Cash
≈$225M

RBC Capital Markets
No Debt

Scotia Capital

TD Securities
1.
Proforma post-closing Reservoir transaction
2.
As at June 23, 2016
Per Company data as at March 31, 2016
$0
Significant NSU Shareholders

Blackrock ~ 13%

Vanguard ~ 13%

Franklin Templeton
22
Contact
INVESTOR RELATIONS
TEL:
EMAIL:
WEB:
+1 604-623-4700
[email protected]
www.nevsun.com
TSX: NSU | NYSE MKT: NSU