New milestone achieved as permitting commences on Donlin Gold Project
Permitting of the Donlin Gold project has commenced, according to a NovaGold press release issued on Aug. 7.
NovaGold Resources Inc. announced that Donlin Gold LLC, owned equally by wholly-owned subsidiaries of NovaGold and Barrick Gold Corporation, has commenced permitting of the Donlin Gold Project. The announcement follows the Donlin Gold LLC board of directors recent approval of the project’s updated feasibility study. Barrick Gold and NovaGold have expressed that they are committed to advance the project through permitting.
Donlin Gold submitted a Plan of Operations and the Wetlands Permit Application under Section 404 of the U.S. Clean Water Act to the federal and state regulators, formally initiating the permitting process. This permit application is the driver for the start of the environmental review process under the National Environmental Policy Act (“NEPA”) leading to the development of an Environmental Impact Statement. Over the next few months, the notice of intent for the EIS is expected to be prepared and published by the U.S. Army Corps of Engineers and followed by public scoping for the NEPA process.
“This is a major milestone towards moving the world’s most significant undeveloped gold project up the value chain,” said Gregory Lang, NovaGold’s president and chief executive officer. “Permitting is expected to take about three to four years, a very small percentage in comparison to the project’s life cycle of approximately 27 years planned under the Updated Feasibility Study. The permitting costs are modest, with our share of expenditures expected to be approximately $20 million per year. During permitting, we will have opportunities to optimize costs and, by extension, the project’s economics to further increase Donlin Gold’s value. We believe we can do so. With $300 million in cash, we have sufficient financial resources to advance Donlin Gold through permitting.”
“We also believe we will enjoy the benefits of a rising gold price. NovaGold and its shareholders strongly believe that the secular bull market in gold will continue for many years and appreciate the enormous leverage to gold that this project brings,” said Lang
Mr. Lang added, “Donlin Gold is well-positioned to evolve into a model next-generation gold mine which will deliver significant benefits to all its stakeholders, including the State of Alaska and our Alaska Native Corporation partners. This exceptionally large, long-life and geo-politically safe gold deposit provides its stakeholders with a unique opportunity for substantial wealth generation which should be accomplished in a socially and environmentally responsible fashion. Furthermore, with its strong and time-honored relationship with Calista Corporation and The Kuskokwim Corporation, who own the mineral and surface rights to Donlin Gold, our Project team can continue strengthening its well-established track record of social engagement and environmental stewardship in the community.”
June McAtee, Calista Corporation’s Vice President, Land and Natural Resources commented on this important milestone, “Calista Corporation owns the subsurface lands that make up the Donlin Gold project. Calista identified the presence of lode gold mineralization at Donlin Creek more than twenty years ago. After more than 16 years of geologic exploration and environmental baseline studies, the Donlin Gold project has submitted its permit application to the Army Corps of Engineers and Alaska Department of Natural Resources to construct a mine. The permit application is a significant first step for the project in the permit process and Calista is encouraged by the progress that has been achieved thus far.”
“Calista supports responsible resource development projects. Approximately 100 state and federal permits will be required before construction can begin. The federal National Environmental Policy Act requires that there be opportunities for the public to give input on a proposed project during the permitting process. This process will take several years. Calista supports this process and encourages our Shareholders, Descendants and people living in our Region to educate themselves about the proposed project, and then, make their voices heard so that all issues are addressed.”
“The Alaska Native Claims Settlement Act of 1971 mandated the establishment and operation of Calista as a for-profit business, but also with very unique responsibilities. Calista was empowered to select and receive lands for subsistence and natural resource use; as well as, the obligation to create and build economic assets for its Shareholders. The corporation operates as a business generating profits for its owners--today and long into the future. But Calista must also protect the lands and resources, because our owners depend upon this land for subsistence foods, materials and year-round sustenance.”
“Calista Corporation will meet its duties and responsibilities through responsible and safe development of its lands. The Donlin Gold project presents us with an opportunity for tremendous economic potential right in our Region. As shown by the long pre-permitting stage, this large-scale project will be undertaken with careful consideration and research. Calista is committed to analyzing and monitoring each step of the process, because we understand what is at stake. Resource development can only proceed if it meets high standards of environmental protection, minimal impact on subsistence resources and promotion of economic opportunities for our people.”
Thomas Kaplan, NovaGold’s Chairman, commented, “Commencement of permitting is a material and tangible milestone along the value chain for any major mining project and its stakeholders. Donlin Gold, however, is not just ‘any’ project. We firmly believe that Donlin Gold is poised to be seen by the investment community as the most important pure gold project in the world for all the right reasons: its extraordinary size, grade, production profile, mine life, exploration upside, strong local partnerships...and last, but by no means least, jurisdictional safety. It is unique in our industry.”
“It is for these reasons that we believe NovaGold represents one of the best value propositions in the gold space today. Putting aside our strong cash position and a half interest in Galore Creek, which is projected to be Canada’s largest copper mine, our share of Donlin Gold is a truly extraordinary asset. Notwithstanding the misinterpretation of Barrick Gold’s quarterly report last week, as it relates to Donlin Gold, the simple fact remains that nothing - literally nothing - has changed with regard to the project itself. As Barrick Gold affirmed, and as we are reaffirming today, permitting is going ahead, and at a very reasonable cost to the co-owners. Once Donlin Gold is permitted several years from now, the co-owners of this project will have the first real opportunity to make a construction decision.”