Written by GORDON HOEKSTRA
Citizen staff
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Monday, 24 November 2008 |
NovaGold Resources Inc. -- a partner in the proposed massive Galore Creek mine in northern B.. -- is experiencing financial problems.
The company's cash problems could impact its ownership in the Galore Creek project in northwest B.C., which is jointly owned by Teck Cominco.
NovaGold says if it is not able to raise additional cash in December, it will not have sufficient money to meet its financial obligations.
The company has to make a payment of $1.9 million on the Galore Creek project this week, and another $3.9 million on the Donlin project in Alaska.
If NovaGold does not make the payment on Galore Creek, its interest in the project could drop below 50 per cent.
The mine, which has received the green light from the provincial and federal governments, was put on hold in November 2007 after an engineering review showed costs had escalated to an estimated $5 billion from $2.2 billion. The company is trying to come up with a new mine plan.
The Galore Creek mine has been touted as having benefits -- including direct jobs and supply and servicing work -- throughout northern B.C., including in Prince George.
There were 800 people in seven camps working on the project when it was halted.
The project, which had been expected to be complete in 2012, was hailed by the B.C. mining community as a confidence booster as it was the first new, major metal mine to start construction in a decade in the province.
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Last Updated ( Monday, 24 November 2008 )
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