Corporate news
NovaGold Resources Inc. (TSX:NG) has credited greatly reduced spending on exploration activities and a stronger loonie for paring its second-quarter losses by about 80 per cent as compared with the year-earlier period. he Vancouver-based miner put its net loss at $4.8 million or three cents a share for the three months ended May 31, compared with a net loss of $23.2 million or 22 cents for the corresponding period in 2008.
Exploration expenses were a greatly reduced $4.4 million as the company focused exploration efforts mainly on its Donlin Creek project in Alaska, a 50-50 partnership with Barrick Gold (TXS:ABX).
That compared with $16.9 million in the second quarter last year related to exploration activities at Donlin Creek, as well as its idled Galore Creek partnership in British Columbia with Teck Cominco (TSX:TCKB.), and the similarly idled Rock Creek project in Alaska.
It also enjoyed a $16.10-million foreign exchange gain in the second quarter of 2009 compared with a loss of $700,000 in the same 2008 period, due primarily to the effect of the stronger Canadian dollar against its U.S.-dollar denominated liabilities.
A $4.2-million increase in non-cash stock-based compensation offset the bottom-line improvements. NovaGold says it had cash and cash equivalents of $56.1 million and working capital of $48.9 million on hand at the end of May, compared with cash and equivalents of $12.2 million and a working capital deficiency of $20.2 million at the end of November.
The company raised US$75 million in January through an issue of shares and warrants and has also converted a US$20-million bridge loan into shares and warrants for net proceeds of $2.5 million. Holdings in Vancouver-based Alexco Resources Corp. (TSX:AXR) were sold for net proceeds of $3.8 million.
Northgate Minerals Corporation has announced positive results from the pre-feasibility study regarding its plan to re-open the Young-Davidson Mine in Matachewan. The company hopes to begin construction on the site next year with a goal to being gold production in 2012.
The pre-feasibility incorporates the measured and indicated gold resource of 3.3 million ounces that was announced in December 2008. There are proven and probable reserves of 2.8 million ounces contained gold, 15-year mine-life at a mill throughput of 6,000 tonnes per day and average annual production of over 170,000 ounces of gold at a net cash cost of $333 per ounce.
Alexis Minerals Corporation (TSX:AMC) has announced positive results from the pre-feasibility study on the Lac Pelletier Gold Project in Rouyn Noranda, Quebec. The study estimates that the Lac Pelletier Mine offers a 155 per cent internal rate of return (IRR) and generates over CDN $20.7 million free cash flow on production of approximately 118,100 ounces (109,300 ounces recovered) ounces of gold (oz.Au) over an estimated three year project life.
Lac Pelletier offered Alexis an opportunity to bring a second satellite mine operation into production to complement cash flow earned from the Alexis Lac Herbin mine in Val d’Or, Quebec. The company’s total annual gold production would increase in 2010 to annual levels of between 75,000 and 85,000 oz.Au per year with both mines in production.
Courtesy: Gold Investing News
