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Gold/Mining/Energy : NEVSUN -- Ignore unavailable to you. Want to Upgrade?

To: Gary H who wrote (139)	10/7/1999 10:01:00 PM
From: Syncrude	Respond to of 205

Nevsun Press Release: www2.cdn-news.com FOR: NEVSUN RESOURCES LTD. TSE SYMBOL: NSU OCTOBER 7, 1999 Nevsun Resources Tabakoto Project Update VANCOUVER, BRITISH COLUMBIA--Nevsun Resources Ltd., (NSU.T), reviews the options available for the advancement of the Tabakoto Project to production. These options are based on Nevsun's management reviews of the pre-feasibility study conducted and completed by Bharti Engineering (BLM) of Toronto. The pre-feasibility study outlined a proposal for a 750,000 tonnes per year underground mine producing approximately 140,000 ounces per year at a pre-royalty cash cost of US$183 per ounce gold with a pre-production capital cost of US$74 million. As part of the pre-feasibility study BLM provided the Company with several competitive operating scenarios. The Company's internal review of the data available from the BLM studies indicates that the Tabakoto Project could be advanced to production to generate an internal rate of return greater than 20% at a gold price of US$260 per ounce. This can be achieved by raising the resource cut-off grade for the start-up of the Tabakoto Mine and reducing the annual tonnage production accordingly. The Company's internal review indicates that the Tabakoto Mine could start up as an underground mine at a minimum capacity of 175,000 tonnes per year with a delivered to mill grade of approximately 14.3 grams per tonne gold (0.42 ounces per ton gold). Annual production for this high-grade case is estimated at 74,000 ounces of gold per year for a pre-royalty cash cost of approximately US$120 per ounce and pre-production capital of the order of US$30 million. The project would have a seven year mine life based on the indicated resource and a ten year mine life based on the indicated and inferred resource. The total cost of production, including royalty and life of mine capital, has been estimated at US$190 to US$200 per ounce. It is proposed that a staged growth from this high-grade scenario to the level of the pre-feasibility study could maximize the opportunity for the project to proceed through feasibility into production. The low volume, high-grade scenario develops a project net present value of US$44 million with an internal rate of return (IRR) of 21% at US$260 gold, a net present value of US$72 million (IRR 32%) at US$300 gold, and a net present value of US$90 million (IRR 38%) at US$325 gold. The Company intends to engage an international engineering company to develop the operating plans for an exploration decline to access the Tabakoto ore structures. It is envisaged that trial mining will be conducted as part of the progress to a bankable feasibility study. Following the issue of a mining license for the Tabakoto Project in September, Nevsun is currently in the process of forming a Malian operating company. The exploitation company will be registered as the Tamboura Mining Company ("TAMICO"). The strategic plan for TAMICO will involve the development of a feasibility study to take the Tabakoto project into production. NEVSUN RESOURCES LTD. Dr. John A. Clarke, President & Chief Executive Officer