NovaGold stands pat on Copper Canyon (March 03, 2008)

NovaGold Resources (NG-T, NG-X) will maintain its 60% interest in the Copper Canyon property in northwestern B.C., choosing not to exercise its option to move up to an 80% interest by paying Copper Canyon Resources (CPY-V) $1 million.

The news coincided with a more than 50% increase, or 20, in Copper Canyon’s share price. Its shares closed at 58 on nearly 460,000 shares traded on Feb. 15.

The Copper Canyon property is adjacent to NovaGold and Teck Cominco’s (TCK.B-T, TCK-N) equally owned and co-managed Galore Creek project.

NovaGold and Teck’s decision last November to suspend Galore Creek’s development due to rising costs sideswiped Copper Canyon, as its shares immediately lost 70% of their value.

The Copper Canyon deposit had been touted as a possible high-grade contributor to Galore Creek’s overall copper and gold resources, as the former contains over 2.86 million oz. gold, 37.9 million oz. silver and 1.16 billion lbs. copper.

Copper Canyon must now hope that the Galore Creek partners are successful in the renewed efforts to bring down projected costs and re-ignite development.

NovaGold met its obligations to earn 60% of Copper Canyon in November 2007 by spending $3 million on exploration, delivering of 296,000 NovaGold shares and paying $250,000 in cash.

Work on the property started in 2004 when it was optioned to Spectrum Gold, who later transferred the agreement to NovaGold.

Copper Canyon says a new resource estimate that encompasses drilling carried out last year will be released soon.

Drilling to date indicates a large, bulk-tonnage copper-gold mineralized system peppered with zones of high-grade gold mineralization.

The best hole intersected 271 metres grading 1.92 grams gold, 22.28 grams silver and 1.05% copper.

In all, 44 holes have been drilled on the grounds since 1990, half of those by NovaGold.

Copper Canyon remains financially stable with $1.4 million in its treasury and another $650,000 tied up in short term investments.