Shares of NovaGold Resources Inc. (USA) (NYSEMKT:NG) plunged over 12% to $4.86 Tuesday after the Vancouver, British Columbia-based miner reported a loss for its third quarter.
Also having an impact was the gold price, which fell to a two-week low yesterday due primarily to the rising strength in the US dollar. The US dollar is gaining because of the perception that the Fed will raise interest rates in December. Higher interest rates are a negative for the gold price.
NovaGold is a precious metals company focused on the permitting and development of its 50%-owned Donlin Gold project in Alaska. With approximately 39 million ounces of gold in the measured and indicated resource categories, inclusive of proven and probable reserves (541 million tonnes at an average grade of approximately 2.2 grams per tonne), Donlin Gold is regarded as one of the largest, highest grade, and most prospective known gold deposits in the world.
NovaGold Resources Inc. (USA) (NYSEMKT:NG) reports on FQ3 and projects
NovaGold reported EPS of $-0.02 and revenue of $1.00 million.
More importantly, it updated the status of its flagship 50%-owned Donlin Gold project in Alaska and its 50%-owned Galore Creek copper-gold-silver project in British Columbia.
Latest on Donlin: “The U.S. Army Corps of Engineers, Donlin Gold’s lead Federal permitting agency, is now reviewing the comment submittals received during the Donlin Gold public comment period for the draft Environmental Impact Statement (EIS) in preparation for completing the final EIS.”
Galore Creek Project: “Focusing on completing targeted studies to optimize the project design. Final reports were completed on the first phase of the tunneling evaluation for access and material handling as well as enhancements to the mining, waste rock, and water management plans.”
JP Morgan on NovaGold Resources Inc. (USA) (NYSEMKT:NG)
On September 27, JP Morgan analysts raised their rating on NovaGold from Neutral to Overweight. The analysts have a price target of $8 on the stock, and expect that permitting for the Donlin Gold project will complete next year.
“Now that larger miners have been strengthened we feel they must now focus on finding and developing new mines and this will put the spotlight on NG leading to outperformance,” they further said.