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Donlin Gold Project In Alaska Gets Major Federal Permits

Kitco News

(Kitco News) - The giant Donlin gold project in southwestern Alaska has received major permits from the federal government, owners Barrick Gold Corp. (NYSE, TSX: ABX) and NovaGold Resources Inc. (TSX, NYSE American: NG) announced in a joint statement.

Company officials say this marks the end of a multi-year federal environmental review.

A “record of decision” (ROD) was issued by the U.S. Army Corps of Engineers and U.S. Bureau of Land Management. The Corps issued a combined permit under the Clean Water Act and Rivers and Harbors Act, while the BLM issued an “offer to lease” for a right-of-way for portions of a natural-gas pipeline that would cross federal lands, the companies said.

However, the project still needs a number of individual and state permits, according to a report in the Anchorage Daily News, the state’s largest newspaper. The newspaper also reported opposition from a number of groups.

Still, the Barrick-NovaGold announcement on Monday characterized the ROD and permits as a significant milestone for the project.

“As one of the largest undeveloped gold deposits in the world, Donlin Gold represents exceptional optionality within our portfolio,” said Rob Krcmarov, executive vice president for exploration and growth with Barrick. “Now, with key permits in hand, we can concentrate on further exploring ways of reducing initial capital and unlocking the value of this asset for all of our partners, in keeping with our deep commitment to community engagement and environmental stewardship.”

Greg Lang, NovaGold president and chief executive officer, added that the effort involved cooperation from some Alaska Native corporations.

“The ROD is a very detailed document, which serves as the foundation for issuance of the federal permits required for us to build a technically, environmentally, and financially responsible, as well as a socially sustainable, operation,” he said.

Donlin Gold said the company anticipates providing further details in the fourth quarter on future plans for updating a 2011 feasibility study.

The project has some 39 million ounces of gold grading 2.24 grams per tonne in the measured and indicated resource categories, the companies said. This makes it one of the largest and highest-grade undeveloped open-pit gold projects in the world.

Officials said a prior study showed that Donlin Gold has the potential to produce an average of more than 1 million ounces per year over a 27-year mine life, with “substantial exploration potential beyond the designed mine footprint.”

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