North of 60 Mining News - The mining newspaper for Alaska and Canada's North

NovaGold Resources Inc. has cleared several important permitting hurdles in its quest to develop the Rock Creek and Big Hurrah gold mines near Nome.

The Alaska departments of Natural Resources and Environmental Conservation issued construction permits for the project Aug. 9.

NovaGold, owner and operator of the mines, envisions the project becoming its first development-stage venture to begin significant gold production. First gold production at a rate of roughly 100,000 ounces per year at Rock Creek could begin by late 2006 or early 2007.

The permits from DNR cover fish habitat, water use authorizations, dam construction and reclamation plans.

DEC's permit covers waste management and water quality. The project has already received DEC certification that the mine will meet federal and state water quality standards.

Corps wetlands permit also issued

The U.S. Army Corps of Engineers also issued a key wetlands permit to Vancouver, B.C.-based NovaGold Aug. 21.

Alaska officials say the permitting progress means construction could begin on the mines in August.

Rock Creek and Big Hurrah are six miles north and 42 miles east of Nome, respectively. They are being built jointly by their owner, Alaska Gold Co., a subsidiary of NovaGold which also owns part of the Donlin Creek gold project near Crooked Creek in Southwest Alaska, as well as other mineral properties in Alaska and British Columbia.

The known gold resource at Rock Creek straddles acreage about 66 percent owned by Alaska Gold and 34 percent owned by Bering Straits Native Corp.

The known gold resource at the Big Hurrah site lies within land owned 100 percent by Alaska Gold, but is surrounded by lands owned by Solomon Native Corp.

Alaska Gold's plans call for two open pits, with a mill at Rock Creek to process ore from both mines. Ore milling rates would be about 2.75 million tons per year, while development rock stripping volumes would range from 4.4 million tons per year to 5.5 million tons per year.

Total construction costs are estimated at about $40 million, and the mines have a life expectancy of up to five years. Discovery of additional reserves could extend the life of the mines, which are projected to employ 135 workers, and generate an annual payroll of $8.5 million.

Permits good for Alaska

DNR Commissioner Mike Menge praised the state's Office of Project Management and Permitting, and the entire Large Mine Permitting section for excellent performance throughout the permitting process. "Alaskans can have every confidence that operations permitted under their guidance will be safe, clean and productive enterprises," Menge said.

The state permits represent an assurance to residents in the Seward Peninsula historical mining district, and throughout Alaska, that modern mineral development can take place in full compliance with environmental safeguards, said DEC Commissioner Kurt Fredriksson.

Gov. Frank H. Murkowski also hailed the permits as a demonstration of his administration's successful efforts to work with industry to permit projects that will employ and benefit Alaskans.

"I am very happy that we have been able to issue the permits for this project and look forward to pouring the first gold in about a year," the governor said in a statement. "This mine is a result of our 'Roads to Resources' initiative, which rerouted the Glacier Creek Road out of the Nome watershed, providing access to the Rock Creek mine."

This is the third mine project to receive permits during the Murkowski administration. The other two are Pogo, near Delta Junction, which is now in production, and Kensington, near Juneau, which is under construction.