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Nova Gold weighs up restart at Rock Creek Project

Published: 23:50 14 Oct 2009 AEDT

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(Dorothy Kosich, Mineweb.com) Although NovaGold reported a C$51.4 million loss for the first nine months of this year, the Vancouver-based junior said it is "currently examining the potential to recommence the start-up process at the Rock Creek project."

Nevertheless, the company cautioned it will need "external financing to develop and construct its properties and to fund the exploration and development of its other mineral properties in future years."

For the nine-month period ended August 31, 2009, the company reported a net loss of $51.4 million or negative 30-cents per share compared to net earnings of $2.6 million or 2 cents/sh for the same period of last year.  For the third quarter of this year, the company reported a net loss of $18.1 million or negative 10-cents/sh, compared to net earnings of $1.6 million or 2-cents/sh for the third-quarter 2008.

In its property review section of its financial statement, the company said $23.8 million was spent for geotechnical drilling for the location of mine facilities, environmental baseline data collection, pre-permitting community advisory meetings and various optimization studies at its Donlin Creek gold property in Alaska.  NovaGold contributed 50% toward the expenditures.

The Galore Creek Mining Corporation is considering a more aggressive spending program next year "to advance the project towards a construction decision,"  on the copper-gold-silver project in British Columbia, NovaGold said. During the first nine months of this year, joint venture partner Teck funded $10.4 million for a program primarily focused on roadwork.

Expenditures at the Rock Creek gold project in Alaska for the first nine months of this year totaled $12.5 million, which were totally funded by NovaGold. A care and maintenance team is working to protect the infrastructure and investment on site to resume start-up activities should NovaGold decide to put Rock Creek back into production.

NovaGold does not plan to commence development or construction at its Donlin Creek and Galore Creek projects this year.

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