In spite of global slowdown, NovaGold is hitting benchmarks on several projects

Despite the current global market turmoil, Vancouver’s NovaGold Resources....

Despite the current global market turmoil, Vancouver’s NovaGold Resources said it has achieved a number of important milestones, notably making the transition from explorer to gold producer during the fourth quarter at the Rock Creek gold mine in Nome, Alaska.In a financial release issued Thursday, NovaGold asserted that the current share price "does not reflect the true value of NovaGold’s near-term gold production nor the value of our large strategic development-stage assets.""However, because of continued declining world production, we remain bullish on metals prices in the long term," the company declared. "Management believes that due to the size of NovaGold’s resource base the company offers great leverage to rising metals prices. In addition, many of the pressures on operating and capital costs, such as fuel prices, appear to be moderating which could improve operating margins in the gold sector."The Rock Creek mine, now in the start-up phase, is expected to produce 100,000 ounces of gold annual with life-of-mine cash costs averaging $500 per ounce. The Nome operations, which include the Rock Creek and Big Hurrah mine sites, has a proven and probable reserve of 510,000 ounces of gold with 1.81 million ounces of measured and indicated resource. In the next year, NovaGold will work on permitting Big Hurrah.Meanwhile, a feasibility study for the Donlin Creek Gold project, also in Alaska, is expected to be completed during the first quarter of next year.  Permitting would begin in early 2009 with construction anticipated in 2012. The feasibility study is expected to provide updated cost estimated for the project, which is expected to yield 1 million to 1.5 million ounces of gold annually for more than 20 years. Donlin Creek is currently estimated to contain 31.7 million ounces of measured and indicated gold resources.The Galore Creek copper-gold-silver project in British Columbia is now the focus of two shareholder lawsuit as the result of a decision by NovaGold and Teck Cominco to suspend construction activities at the project after capex costs more than doubled. A federal court in New York State has scheduled a conference for October 31, 2008, for the appointed of lead plaintiff and legal counsel, as well as a consolidation of the complaints.NovaGold anticipates providing an update on the Galore Creek project joint venture with Teck Cominco upon completion of the Optimization Update Study in QW4-2008. "Detailed engineering work has looked at modified project layouts that could potentially expand overall project throughput and is focused on potential to reduce the construction schedule and reduce risks associated with construction execution and operations," the company said.For the nine months ended August 31, 2008, the company report net earnings of $36.7 million or 35-cents per share, compared to a loss of $12.2 million (13-cent loss per share) for the same period of 2007.  The increase in earnings were attributed to a $33.5 million gain on the sale of NovaGreenPower, a $15.3 million gain on disposal of shares in U.S. Gold, and a $16.3 million suspension cost recovery at Galore Creek, net of related non-controlling interest, offset by the $9.2 million of care and maintenance costs at Galore Creek, and $5.4 million in mineral property write-downs.For the third quarter ended August 31, 2008, NovaGold report net earnings of $16.7 million or 16-cents per share, compared to a loss of $4.2 million (negative 4-cents/sh) for the third quarter of 2007.Meanwhile, NovaGold announced last month that it will sell its interest in the Ambler project and early-stage base metals properties in Alaska. The company also secured a US$18.8 million bridge loan from Auramet Trading. On October 1, 2008, 2.31 million share purchase warrants were exercised for net proceeds of $15.3 million, net of costs.