First gold pour by year-end: Rock Creek transforms NovaGold into producer status.

• Author: Liles, Patricia
• Position: SPECIAL SECTION: MINING ISSUE - Company overview

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Founded a decade ago by a geologist looking to continue working in Alaska and to exit the large corporate employment culture, NovaGold Resources is about to celebrate its 10th anniversary with a big splash--complete with gold dore bars poured from the company's new mine being built near Nome.

The Vancouver, British Columbia-based minerals exploration company with significant gold and polymetallic property holdings throughout Alaska has grown up in the Last Frontier, weathering record low gold prices, a stagnant metals market and a steep business learning curve for its principals.

After racking up a number of exploration successes, realizing cash flow from real estate, aggregate and stock sales, reaping the financial benefits from a dramatic increase in metals prices and turning that into successful, open-market capital fundraising, NovaGold has become a successful company that employs more than 100 people and will soon become a gold producer.

Key to that transformation is the company's 100-percent owned Rock Creek open-pit, hard-rock gold mine, which is being built 7 miles north of Nome on the western Alaska coast. The Rock Creek facility is scheduled to be commissioned and to start producing gold before the end of the year.

With a capital cost of about $115 million, Rock Creek is expected to produce about 100,000 ounces of gold annually. "It makes us a producer, which is a major accomplishment for a company that was founded 10 years ago," said Rick Van Nieuwenhuyse, president and chief executive officer of NovaGold.

GOLD FEVER

In 1998, NovaGold consisted of its founder, Van Nieuwenhuyse, who grew up in the Eagle River and Anchorage areas, and two other geologists and coworkers from Placer Dome whom he convinced to join his new company.

At that time, Van Nieuwenhuyse, who was a new father, was facing reassignment to Africa and Asia with the large mining company. Additionally, the pace of corporate minerals exploration wasn't what he and his co-workers desired.

"Basically we were tired of working for a big company and we had the experience to make it happen for a small junior," Van Nieuwenhuyse said. "We were young and naive in some ways--we didn't know anything about raising money and we had a lot of hard lessons in a tough market."

Back then, gold prices were on their way to dropping to record lows of $250 an ounce. Stock market investors, enamored with dramatic gains in technology stocks, steered clear of gold and other metal-back investments. "It was the post Bre-X big scandal and no one would even open the door if you knocked," Van...