Galore Creek looks good for NovaGold

Vancouver — A preliminary economic assessment of NovaGold Resources‘ (NG-T) Galore Creek project, in the Stikine gold belt of northwestern British Columbia, envisions an open-pit operation capable of mining 30,000 tonnes per day.

The study moreover indicates potential for a 23-year mine life and a quick payback period of 3.4 years.

Annual output is pegged at 270,000 oz. gold, 1.8 million oz. silver, and 200 million lbs. copper over the first five years of operation. Total cash costs are expected to be US15 per lb. copper when gold and silver values are factored as credits.

Galore Creek will be subjected to a prefeasibility study and environmental assessment in 2005, followed by a full feasibility in 2006.

This year’s budget exceeds $8 million, most of which is reserved for drilling. An ongoing, 20,000-metre program is aimed at upgrading existing inferred resources to the measured and indicated category, and expanding resources and higher-grade zones.

In mid-2003, NovaGold acquired an option for a 100% royalty-free interest in the property from Rio Tinto (RTP-N) and Anglo American (AAUK-Q) by completing a prefeasibility study and making payments totalling US$20.3 million over eight years. Rio Tinto and Anglo extensively worked the project from the early-1960s through to the early-1990s.

NovaGold has now consolidated the entire district, with agreements in place for the nearby Copper Canyon and Grace properties. In addition, NovaGold has staked 370 sq. km of new claims in the district.

The company is working with the Tahltan First Nations, who support responsible development of natural resources on their territory.

The Galore Creek deposit hosts an indicated resource of 285.9 million tonnes grading 0.44 gram gold and 5.7 grams silver per tonne, plus 0.73% copper. There is also an inferred resource of 98.8 million tonnes grading 0.37 gram gold, 4.8 grams silver and 0.54% copper.

NovaGold has 62.8 million shares outstanding and trades in the range of $6-6.50 per share.