NovaGold says the feasibility study for the Donlin Creek gold mine will cost $4.5 billion and will produce 1.6 million ounces of gold a year over the first five years.
Posted: Wednesday , 29 Apr 2009TORONTO (Reuters) -
NovaGold Resources (NG.TO: Quote) said on Tuesday that its 50 percent owned Donlin Creek gold project in Alaska holds reserves of 29.3 million ounces and should produce an average of 1.6 million ounces of gold a year over the first five years after it starts production in 2015.
In a feasibility study, the Canadian company said the project -- a joint venture with Barrick Gold (ABX.TO: Quote) -- should cost about $4.5 billion to build and produce gold at a cash cost of $398 an ounce over the first five years.
The production level -- which should average 1.25 million ounces a year over the mine's 21-year life -- would make the gold mine one of the world's most productive.
Novagold said the mine should initially produce average annual after-tax cash flow of $779 million at $900-an-ounce gold. (more)
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