Bisha is a large precious metal and base metal-rich volcanogenic massive sulphide (VMS) deposit.  Suggested models for the deposit include felsic dominated bimodal-siliclastic VMS and Noranda/Kuroko type deposits and a comparison has been made to the Matagami VMS district in Quebec. 

Continued exploration has lead to the discovery of two additional satellite deposits within the Bisha Concession; The Northwest Zone, located approximately 1.5 km northwest of the Bisha Main Zone, and the Harena Deposit, located approximately 9.5 km, along strike, to the southwest of the Bisha Main Zone.  These two satellite deposits are viewed as potential sources of supplemental feed for the proposed processing facility at Bisha.

A summary of Bisha's proven and probable mineral reserves from the Bisha feasibility study is presented below. The feasibility study is currently being reviewed by an Independent Technical Consultant acting on behalf of banks. The "43-101 Technical Report on the Feasibility Assessment Bisha Property" prepared by AMEC for the Company has been filed on SEDAR and EDGAR.  Social and environmental work is also progressing.  Please see our Social Responsibility Bisha page for details.

Highlights from the Bisha Feasibility Study:
 

Minerals	Gold, Copper, Zinc, Silver
Metal Production (Life of Mine) (all payable)	- 1.06 million oz gold - 747 million lb copper - 1,092 million lb zinc - 10 million oz silver
Production Schedule	+10 years open pit mine modeled at 2 Mt/year of ore production - years 1 and 2, average 447,000 oz Au per year - years 3 to 5 average 173 million lb Cu per year plus precious metal credits - years 6 to 10 average 218 million lb Zn plus 39 million lb Cu per year plus precious metal credits
Base Case Scenario (after tax): (Au $435/oz Cu $1.44/lb prior to 2015 and $1.28 thereafter, Zn $0.57/lb, Ag $6.50/oz)
Rate of return	26%
NPV (0% discount)	$356 million
NPV (10% discount)	$135 million
Payback	2.6 years (pre-production capital payback)
Capital Cost Estimate	$196 million pre-production
Expansion Capital Estimate	$61 million + $31 million in two phases, funded from operations
Operating Costs	$31.64/tonne ore milled through life of mine
Recent Prices Scenario (after tax): Utilizing recent metal prices over life of mine (Au $650/oz, Cu $3.00/lb, Zn $1.50/lb, Ag$13/oz)
Rate of return	65%
NPV (0% discount)	$1,943million
NPV (10% discount)	$897 million
Payback	1.2 years (pre-production capital payback)

The Deposit

The Bisha deposit is configured in three distinct layered zones – a 35m thick surface oxide zone having a high gold and silver content immediately overlying a 30m thick copper enriched supergene zone which itself overlies a primary sulphide zone containing both zinc and copper. Significant byproduct gold and silver are recoverable from both the supergene and primary ores.

A full description of the Bisha mineral resource and metallurgy may be found in the Company’s news releases dated January 10, 2006 and July 17, 2006, respectively.

*Click on the slide above to view a 3D Video of the Bisha Main Zone ore body.

Proven and Probable Mineral Reserves

Capital costs to develop the Bisha mine total $196 million as outlined in Nevsun's News Release of October 12, 2006.  Processing of the three ore types will utilize a common crushing and SAG/ball grinding circuit, but will require three different extraction and processing circuits. After grinding gold and silver will be extracted from the oxide ore by conventional cyanide leaching and recovered by the carbon in pulp process. Later in the project the supergene and primary ores will be processed by a conventional flotation process to recover copper and zinc as concentrates for direct sale to smelters. The tailing systems will be common for all three ore types.

The feasibility study envisages the mining and processing of each zone in succession starting with the surface oxide zone. Before the oxide ore is exhausted the copper flotation process equipment will be installed and commissioned so that a smooth transition can be made from oxide ore to the supergene ore treatment. Similarly, before the supergene ore is exhausted, the additional flotation equipment required to recover the zinc from the primary ore will be installed and commissioned to permit a smooth transition from supergene to primary ore. No interruption to production is anticipated or required when transitioning from one ore type to another.

In the first two years of production, gold and silver will be extracted together. Production of copper concentrate will begin with a minor amount in Year 2, significant quantities for Years 3 to 5, and smaller quantities in Years 6 to 10. Zinc concentrate production occurs only in Years 6 to 10.

Operating costs for the Bisha mine are presented below:  
 

Life of Mine Operating Costs:
Mining	$135 M	21%	$6.75/t
Process	$365 M	58%	$18.17/t
G&A (incl royalties)	$135 M	21%	$6.72/t
Total	$635 M	100%	$31.64/t	(including fuel and power of $236M; $11.75/t)

The Government of Eritrea has been actively reviewing the Feasibility Study, the Social and Environmental Impact Assessment (SEIA), and the draft Environmental Management Plan for the Bisha project.  The Government of Eritrea engaged an international mining consultancy to complete a due diligence review of these documents, and Nevsun requested Endeavour Financial to arrange a further independent review to be completed on behalf of prospective project financing partners.

Since January 2007 with the two due diligence reviews in progress, the Company has continued constructive discussion with the Government of Eritrea regarding the development of a mining agreement with a view to taking the Bisha Project into production. These discussions are still progressing. In early February H.E. Tesfai Ghebreselassie, the Minister of Energy and Mines of Eritrea, outlined the continuing strong government support for exploration and mine development in Eritrea, including the Bisha Project, in a presentation at the Indaba Conference in Cape Town.

In parallel with the mining agreement discussions, Nevsun is progressing with the selection review for an EPCM (engineering, procurement, construction and management) contractor for the Bisha Project. The Company has also sought competitive quotes for the procurement of the project’s major capital long lead items. The main critical long lead items include the crusher, SAG and ball mills, mill motors and mining fleet. The Company is planning to order the most critical long lead items shortly so as to enhance a timely completion for the overall project. Funding for this procurement and for starting the detailed engineering design component of an EPCM contract for the 2m tonne per year Bisha mining and milling operations was the focus of the private placement financing of October, 2006.

*Please refer to Investor Relations/News Releases for up-to-date Bisha news.

Nevsun Land Position in Eritrea.

Landsat Image of the Bisha Concession showing the NW Zone and Harena Deposit.

Bisha Property, looking south.

To view a historical comparison of the 2006 vs the 2004 Bisha Resource Estimate click here.

3D image showing the Bisha Main deposit with pit outline, Hanging wall Copper zone drill holes & trenches (purple), the NW Zone and the Harena Deposit.

Interpreted Outline of Massive Sulphides at the Northwest Zone (Viewing East).

Interpreted Outline of Massive Sulphides at Harena (Viewing East).