NovaGold (AMEX:NG), Barrick (NYSE:ABX), Looking to Cook Inlet for Gas Supply for Donlin Creek

NovaGold (AMEX:NG) and Barrick (NYSE:ABX) have launched an initial study to consider implementing a natural gas pipeline, bringing into the project from Cook Inlet, 325 miles away.

The pipeline itself would be 12 inches in diameter.

Estimates at this time are the use of the pipeline as the prime source of energy for the company would result in cutting overall operating costs by as high as 25 percent.

"A natural gas pipeline has the potential to significantly improve operating costs and reduce operating risks," said NovaGold CEO Van Nieuwenhuyse recently.

Annual requirements for the Donlin Creek project would be from 8 billion to 12 billion cubic feet. That could be higher if natural gas is used to power equipment at the mine.

The alternative method of accessing energy if natural gas isn't used would be to ship diesel fuel by barge up the Kuskokwim River.

Another source of energy is a wind energy project close to the mine which would be able to supply about 7 percent of the power to Donlin.