NovaGold expands Maritime holdings

With the staking of 65 claims adjacent to its Sewell Brook base metal property in New Brunswick, NovaGold Resources (TSE) has increased its total holdings in the area to 247 claims.

The company made its initial discovery at Sewell Brook in 1990, when its first drill hole intersected 3.72% copper over 33 ft., 9% combined lead and zinc over 5 ft. and 12% combined lead and zinc over 6 ft. Hole 10 intersected 10.75 ft. of 10.97% lead-zinc, 5 ft. of 17.44% copper and 7.08% zinc and 19 ft. of 8.07% lead-zinc. Hole 11 intersected 16.5 ft. of massive sulphides grading 36.9% lead-zinc plus 0.061 oz. gold per ton.

Chapleau Resources (VSE), which is drilling a property along the southwestern boundary of Sewell Brook, has also hit strong base metal intersections.

Sewell Brook is a volcanogenic massive sulphide deposit. Mineralization and alteration have been intersected along a strike length of 1,000 ft. and to a depth of 900 ft.

A private placement with a European investor will provide NovaGold with $250,000 to explore Sewell Brook. NovaGold will issue 1 million shares to the subscriber at 25 cents per share and 1 million non-transferable share purchase warrants. Each warrant will entitle the holder to buy one common share of NovaGold for 20 cents, on or before Feb. 9, 1998.

Meanwhile, NovaGold subsidiary Pine Cove Resources and partner New Island Minerals (ASE) have optioned 35% of the Pine Cove property to Electra Mining Consolidated (VSE). The original partners will end up with 70% and 30% of the property, respectively.

Past drilling at the property, which is on Newfoundland’s Baie Verte Peninsula, has established a minable reserve of 2.6 million tonnes at an average of 2.79 grams gold per tonne, for a contained gold total of 233,656 oz. A positive feasibility study and environmental impact study have been completed.

The agreement will see Electra process 30,000 tonnes of the Pine Cove ore at its newly constructed indoor vat leach mill at the Rambler tailings facility, to confirm costs and recoveries. Upon completion of the work, a decision will be made either to expand the Rambler facility or secure project financing to construct a 1,500-tonne-per-day, indoor vat leach facility at the Pine Cove property.