Don't let Barrick acquire NovaGold before closing gold short, GATA Says


International Press Release
via Business Wire
Monday, August 14, 2006

Barrick Gold Corp.'s attempt to acquire NovaGold Resources Inc. at a huge discount to the value of the latter company's metal in the ground is the next battlefield in the struggle to liberate the price of gold, the Gold Anti-Trust Action Committee says.

Barrick's short position of about 12 million ounces of gold, believed to have been borrowed from central banks, long has been a major suppressing force against the gold price and against the price of gold mining shares, GATA says. Meanwhile, according to GATA, NovaGold is believed to have access to as much as 50 million ounces of gold at its Donlin Creek property in Alaska and another 18 million or more ounces at its Galore Creek property in British Columbia. Galore Creek is also estimated to hold 13.4 billion pounds of copper.

If Barrick acquires NovaGold without first substantially reducing its short position in gold, GATA says, the gold price will remain suppressed along with the price of gold mining shares. But, GATA adds, if Barrick is forced into a substantial reduction of its short position before acquiring NovaGold, the gold price may rise sharply and take mining shares with it.

GATA notes that much of the increase in the price of gold in recent years has been attributed to the reduction of hedges, the closing of short positions, by gold producers. Further, defending itself against the gold price-fixing lawsuit brought by coin and bullion dealer Blanchard & Co. in U.S. District Court in New Orleans, Barrick claimed in 2003 that it is the agent of central banks in the gold market and should share their immunity from suit.

A copy of Barrick's claim to be an agent of central banks in the gold market can be found on the Internet here:

Barrick has offered to pay $14.50 per share for NovaGold, which lately has been trading above $16.50.

GATA urges NovaGold shareholders not to tender their shares to Barrick before Barrick closes its short position in gold. GATA also urges advocates of a free market in gold to purchase NovaGold shares as long as Barrick maintains its short position. These, GATA says, may be the strongest blows that can be struck right now against the gold price suppression scheme.

GATA's appeals to oppose NovaGold's acquisition by Barrick can be found on the Internet here:

and here:

GATA is a non-profit civil rights and educational organization established in 1999 to expose and oppose price-fixing in the precious metals markets. It has 3,000 supporters around the world. It is recognized by the U.S. Internal Revenue service as tax-exempt under Section 501-c-3 of the U.S. Internal Revenue Code and so donations to the organization are federally tax-deductible in the United States.

More information about GATA can be found on the Internet here:

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Chris Powell, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
Manchester, Connecticut USA