FAIRBANKS (AP) -- NovaGold Resources is reporting that it has discovered an additional 4 million ounces of gold at its massive Donlin Creek property 150 miles northeast of Bethel.
''It's a lot of gold,'' said NovaGold President Rick Van Nieuwenhuyse.
The latest discovery at the prospect, located about 150 miles northeast of Bethel, brings total estimated gold at the project to nearly 28 million ounces.
The amount of gold that can be recovered depends on the price of gold. If gold is $350 an ounce, then the company could mine lower grades of gold deposits.
The company is considering mining 1 million ounces a year over two decades, Van Nieuwenhuyse said. By comparison, the Fort Knox and True North Mines, both owned by Fairbanks Gold Mining Inc. combined are expected to produce about 440,000 ounces of gold for 2002.
NovaGold completed its 2002 exploration work this month and will release a formal report of the data by February, said Greg Johnson, NovaGold's vice president of corporate development.
The company plans to embark on a two-year feasibility study next summer and will begin the permitting process by mid-2004, Van Nieuwenhuyse said. That process could take up to 18 months to complete, he said.
''We're just starting down the path.'' Last month NovaGold received 70 percent interest in the project from Placer Dome, which had been developing the property in the mid-1990s.
NovaGold spent $10 million on work at Donlin Creek to earn the controlling interest. Now Placer Dome, one of the world's top six gold-producing companies, has until mid-February to decide if it will earn back 70 percent interest by committing to spend $30 million on the project, completing a sound feasibility study, and ultimately building a mine capable of producing at least 600,000 ounces a year.
A manager with Vancouver-based Placer Dome would not comment about what the company will do.
''Donlin Creek is an exciting project,'' said Rob Pease, Placer Dome's general manager of global exploration projects. ''We knew that years ago.'' Low gold prices caused the company to drop out of the project and turn it over to NovaGold in early 2001, he said.
''They've done a wonderful job,'' he said. ''So here we are today.''
Rising gold prices are encouraging, Pease said. Gold closed at $340 an ounce on Wednesday, the highest it's been in 2002.
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