Novagold takes aim at Shotgun (June 22, 2001)

Vancouver — Novagold Resources (NRI-T) has completed an agreement with Cominco (CLT-T) to earn the 52.5% it does not already own of the 1-million-oz. Shotgun gold property in southwestern Alaska.

Novagold is based in San Jose, California.

The project is located south of the company’s newly acquired Donlin Creek gold deposit. NovaGold picked up a 47.5% stake in 1998.

The junior drilled 19 holes into the property and outlined an inferred resource of 32.8 million tonnes grading 0.9 gram gold per tonne, using a 0.5-gram-gold cutoff. With a cutoff grade of 0.75 gram gold, the resource came in at 16.6 million tonnes grading 1.3 grams. With a cutoff grade of 1 gram gold, it was 11.6 million tonnes averaging 1.4 grams gold.

The higher-grade sections are close to surface and the preliminary pit design suggests a stripping ration of about 1-to-1. Early metallurgical test work shows recoveries of 90% from cyanide leaching.

The mineralization occurs in the Mose target area as near-surface porphyry stockworks.

Under the deal, Cominco retains a 5% net profit interest in the property and gets the remaining 50% interest in the nearby Sleitat tin project. NovaGold keeps a 5% net profit interest in Sleitat.