For completeness' sake, Here is the 2/18 release:
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Nevsun Resources Ltd.
2/18/99 -
Agreement: Kubi Property Mine Development with Ashanti Goldfields
NEVSUN RESOURCES LTD ("NSU-TV;NEVNF-L") ASHANTI GOLDFIELDS CO LTD
("AHD.U-T;ASL-HDNQX") - Agreement: Kubi Property Mine Development with Ashanti
Goldfields
Dr. John A. Clarke, President and Chief Executive Officer, Nevsun Resources Ltd., is pleased to
announce that the Company has entered into an agreement with Ashanti Goldfields Company
Limited ("Ashanti"), subject to the approval of the Government of Ghana, for the transfer of
the surface rights of Nevsun's Kubi Concession in Ghana to Ashanti. The Agreement calls for
Ashanti to make an initial payment on closing of US$1.8 million (CDN$2.7 million) for the first 60,000 ounces to be recovered from the surface
resources. In addition, Ashanti shall make royalty payments of US$15 for every additional recovered ounce beyond 60,000 ounces. Should
the gold price exceed US$325 per ounce, Ashanti shall pay Nevsun an additional 20 percent of the amount by which the gold price exceeds
US$325 per ounce for all ounces over 60,000 ounces.
Ashanti will have the option to mine the underground resources at Kubi, such option to be exercised within four years. If after four years
Ashanti has not exercised the option, Nevsun may extend the option at the request of Ashanti, subject to Ashanti paying Nevsun an option
fee of a minimum of US$450,000 (equivalent to 30,000 ounces at the royalty described above). In addition, the Agreement calls for a minimum
annual production rate of 30,000 ounces by year five or the property may revert back to Nevsun. Twenty percent of the initial payment is to
be held in escrow, pending receipt of an appropriate forestry permit or the recovery of the first 60,000 ounces from areas outside of a forestry
reserve.
Nevsun's management believes this transaction is a very positive development for the Company as it will put the Kubi property into
production and it will create a royalty stream that has an upside on any increase in the gold price above US$325 per ounce without exposure
to either a decrease in the price of gold or operating costs. In addition, it sets in place a timetable to develop the underground resource at
Kubi and injects US$1.8 million (CDN$2.7 million) into the Company. As announced November 18, 1998, an updated resource estimate for the
Kubi property was completed by Pearson, Hofman & Associates Ltd. of Toronto, Ontario. The total indicated resource at Kubi is now 485,000
ounces with an additional inferred resource of 282,000 ounces of gold. TEL: (604) 623-4700 or 1-888-600-2200 Don Halliday, Vice President,
Corporate Development, Nevsun Resources Ltd. E-MAIL: dhalliday@nevsun.com
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