Vancouver-based Nevsun Resources, listed on the TSX and NYSE, has provided an update on the Bisha zinc expansion project in Eritrea. Nevsun has a 60 % interest in the high-grade Bisha mine with the balance held by the state-owned Eritrean National Mining Corp.
Overall view of the zinc expansion project at Bisha (photo: Nevsun).
According to the company, construction remains on-schedule and well under budget with nearly one million man hours worked with zero lost time incidents. Cold commissioning is now underway and progressing well. Hot (ore) commissioning has been delayed one month due to additional supergene copper processing.
The zinc expansion project enables processing of the primary copper-zinc-gold-silver ore at up to 2,4 Mt/a, producing both copper and zinc concentrates from the existing copper flotation and new zinc flotation plants. Current reserve life with the completed zinc expansion project is to 2025.
Bisha is one of the few new sources of zinc concentrate hitting the market in 2016. Bisha’s zinc concentrate is expected to be high quality and is reportedly attracting significant interest from buyers. Bisha’s zinc offtake remains completely uncommitted at this time as the zinc market is expected to continue to tighten.
The forecasted total cost of the zinc expansion project remains approximately US$80 million, significantly under the original budget of US$100 million.
Bisha continues to mine, and has historically stockpiled, a variety of highly variable precious metal materials. In 2015 it invested in equipment to screen and beneficiate portions of the materials in an effort to create saleable contiguous lots of material. These efforts defined 90 000 tonnes of varying materials assaying 20 to 30 g/t gold and 800 to 900 g/t silver. Bisha will continue to market this material throughout 2016.
Cliff Davis, Nevsun CEO commented, “With the zinc plant nearly complete, strong demand for products and increasing gold, silver and copper prices since December 31, 2015, we expect higher than budgeted cash flows throughout 2016. The recent precious metal stockpile sales confirm the marketability of the material at more favourable commercial terms than originally expected. In addition, with the likely prioritisation of shipping the precious metal stockpile material, I am not expecting the first sale of zinc concentrate until late Q3 or early Q4 2016.”
