June/July 2007


Major developments made green

By C. Hersey

Donlin Creek Lewis-Acma resource and camp

In a world where ‘green’ is the new black, mining companies are making a conscious effort to employ more environmentally responsible techniques and give back to the communities in which they work. NovaGold has tried to be an industry leader for responsible mining from the very beginning, and they aren’t about to jump off the bandwagon anytime soon.

NovaGold originally traded under a different symbol under different management, but the company was essentially shelved back in 1997. In 1998, Rick Van Nieuwenhuyse and his partner, Greg Johnson, both senior geologists working for Placer Dome Inc., paired up in search of interesting properties to get a company going. They were already familiar with Donlin Creek, and established a joint venture for the project with Placer Dome. Thus, today’s NovaGold was born. The company currently has four major projects—Nome Operations, Galore Creek, Donlin Creek, and Ambler—well on their way throughout Alaska and British Columbia, all of which are ‘green’ in their own sense.

Nome Operations

The first of NovaGold’s major projects, Nome Operations, is situated in Alaska. It consists of three smaller projects: Rock Creek, Big Hurrah, and Nome Gold. Construction for Rock Creek and Big Hurrah began in August of 2006, immediately upon receiving major permits. The projects are located partially on 14,000 acres of private NovaGold land, and partially on 20,000 acres leased from the Bering Straits and Sitnasuak Native Corporations. Employment opportunities will be made available for approximately 135 people, and NovaGold and Alaska Gold held numerous public meetings from 2003 to 2006 to ensure the community had the chance to ask questions, give opinions, and voice any concerns. Rock Creek is expected to produce about 100,000 ounces of gold per year. The Big Hurrah deposit is a smaller but higher grade satellite deposit, and ore from it will be trucked to the Rock Creek mill facility for processing, thus enhancing the overall economics of the project.When both are up and running, the Rock Creek and Big Hurrah properties will be the first modern, open-pit, ‘hard rock’ mines on the Seward Peninsula. Production for both properties starts in the third quarter of 2007, transitioning NovaGold from explorer/developer to producer.

Nome Gold, the third property in the Nome Operations trio, is one of the largest sources of construction aggregate on the Pacific Rim. The property contains a Measured and Indicated Resource of 1.6 million ounces of gold and an additional Inferred Resource of 250,000 ounces. In the past 100 years, the Nome alluvial deposits produced almost 5 million ounces of gold from shallow sand-and-gravel deposits.The Nome goldfields were profitably mined solely as an alluvial gold operation, producing about 25,000 ounces of gold a year, until 1998, when mining was shut down because of low gold prices. Nome also boasts sand-and-gravel properties and land businesses. These smaller side projects have generated approximately US$1 to $3 million in annual cash flow over the past six years.With these massive sand-and-gravel aggregate resources, NovaGold sees potential to expand its aggregate business well beyond its existing western Alaska market. The company is also examining the potential to restart alluvial gold production, aiming to produce 25,000 ounces of gold annually and several million tonnes of sand-and-gravel co-product. A little recycling goes a long way.

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