NovaGold Resources (NG.TO) expects to soon release a new mine plan for its Galore Creek copper-gold joint venture in British Columbia and may take a more aggressive approach with the project this year, it said on Tuesday.

The Vancouver-based company cited rebounding metal prices and the improved fortunes of partner Teck Resources (TCKb.TO) as reasons to expect progress on the stalled development.

Galore holds a treasure of 8.9 billion pounds of copper and 7.3 million ounces of gold, but development was put on ice in 2007, when cost estimates more than doubled to C$5 billion ($4.8 billion).

The 50-50 partners have since been working on an alternative development plan to reduce costs, although Teck's participation came into question after the company was forced to sell some assets to pay down billions in debt taken on to buy Fording Canadian Coal Trust in 2008.

Teck has since rebuilt its balance sheet and said in October it was finished selling off assets.

Copper, meanwhile, has regained much of the ground lost in the late-2008 resource crash, while gold prices have charged above $1,100 an ounce, setting a record high last year.

Copper's turned around, gold's turned around, Teck's got its house back in order, so we're just looking at the project again with sort of more vigor this year, Rhylin Bailie, NovaGold's manager of investor relations, told Reuters.

$500 MILLION SHELF

The company has ready access to capital after filing a $500 million base shelf prospectus in late December, which will allow it to offer debt or equities over a 25-month period.

NovaGold expects to release an updated mine plan for Galore Creek by the end of the first quarter.

It would then work up an updated pre-feasibility study using higher copper and gold prices and taking into account the redesign, which involves a new plan for the processing facility and tailings dam.

A construction decision would follow, but not this year, Bailie said.

Shares of Toronto-listed NovaGold rose 3 Canadian cents to C$6.59. Teck gained 99 Canadian cents to C$40.00.

Teck Resources spokesman Greg Waller confirmed the company was looking to begin work on a pre-feasibility study later this year, but said Galore ranks below Teck's Quebrada Blanca and Relincho copper projects -- both located in Chile -- on its priority list.

NovaGold's other big project is the Donlin Creek gold deposit in Alaska, a joint venture with Barrick Gold (ABX.TO).

The project holds a massive reserve of 29 million ounces of gold and is expected to produce an average of 1.6 million ounces a year in the first five years after it begins production, which is currently seen in 2015.

However, like Galore Creek, Donlin has a high price tag, with a study last year pegging start-up costs at $4.5 billion. NovaGold and Barrick are currently working on plans to reduce that number.

($1=$1.04 Canadian)

Canada