Topic: How To Invest

Pat: Could I have your investment opinion on Nevsun Resources? It’s NSU on the TSX. Thanks.

Article Excerpt

A: Nevsun Resources Ltd., $4.08, symbol NSU on Toronto (Shares outstanding: 299.7 million; Market cap: $1.2 billion; www.nevsun.com), owns 60% of the Bisha copper/zinc/gold mine in Eritrea. That stake is the company’s main asset. Bisha started up in February 2011. Nevsun used the gold it extracted from the deposit’s top layer to finance construction of the project’s second phase: copper mining below that level. The mine produced 112,000 ounces of gold in 2013. However, the gold deposit ran out early that year. Nevsun transitioned to copper mining in late 2013, with full production starting up in December. Bisha produced 135.9 million pounds of copper in 2015. Operating in Eritrea means considerable political risk for Nevsun. That risk is partially offset by the company’s 40% partner in the operation—the Eritrean government. The mine is a major source of revenue for this poor nation, contributing a big portion of the country’s gross domestic…