Newmont’s Galore Creek payment bolsters Novagold coffers
Junior project developer Novagold Resources has materially increased its treasury with the sale of its 50% interest in the Galore Creek project, in British Columbia, to gold mining major Newmont.
Novagold last week reported that it had received $25-million from Newmont, as per the 2018 share purchase agreement in which it sold its interest in Galore Creek.
Under the terms of the agreement, total consideration payable by Newmont was up to $275-million for a 50% interest in Galore Creek. Teck Resources owns the other 50% of Galore Creek, which with resources of eight-million ounces of gold and nine-billion pounds of copper is one of the world’s biggest undeveloped projects of its kind.
Novagold received $100-million upon closing, $75-million in July 2021 and this most recent receipt.
The latest payment from Newmont increased Novagold’s cash position by $25-million, which consisted of about $109-million of cash and term deposits as of May 31.
As a result of the successful sale of the Galore Creek, Novagold is in a strong financial foundation to advance its 50%-owned Donlin gold project, in Alaska. Novagold owns the Donlin project in a joint venture with Barrick Gold. With 39-million ounces of gold in the measured and indicated mineral resource categories, the Donlin project is regarded to be one of the biggest, highest-grade, and most prospective known openpit gold deposits in the world.
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