Vancouver — NovaGold Resources (NG-T, NG-X) says the U.S. government is reinstating a key permit for its Rock Creek gold mine in Alaska, a project that the company hopes to have in production by the third quarter of this year.
News that the wetlands permit is about to be reinstated comes after NovaGold reported a loss of $30.5 million or 33 a share in the year ended Nov. 30, 2006, largely due to the cost of fending off an unsolicited takeover bid from Barrick Gold (ABX-T, ABX-N).
That was up from a net loss of $5.8 million (or 9) in 2005.
While the Barrick offer was on the table, NovaGold said it incurred $19 million in legal and professional advisory costs, plus another $2 million in administrative expenses for staff who were working on matters related to fighting the bid.
However, NovaGold says the U.S. Army Corps of Engineers is about to reinstate the permit, meaning the company is free to get on with developing a mine that is expected to produce about 100,000 oz. gold annually.
NovaGold spokeswoman Rhylin Bailie says the company is pleased with the decision because Rock Creek is designed to steer NovaGold through a transition phase as it develops potentially larger operations in northwestern British Columbia and Alaska.
The lawsuit was suspended pending a review last December, after a citizens’ group filed a lawsuit, alleging that the permit had been granted in violation of government legislation.
“They were complaining about the process, rather then the result,” says Bailie, adding that neither NovaGold nor its subsidiary Alaska Gold were named as defendants.
NovaGold says the Corps completed an extended review of the permitting process and concluded that the permit was consistent with applicable laws and regulations.
Bailie says the brief suspension of the permit was a hindrance to development only in the sense that the company was prevented from digging on ground that had not already been disturbed.
NovaGold shares rose 14 to $19.44 on the news that the permit will be reinstated.
Be the first to comment on "NovaGold gets Alaska permit boost"