How a billionaire's bet on Donlin mine could inject new life into the huge, slow-moving Alaska gold project

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08-05-2025

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Max Graham
The Northern Journal
For years, plans to develop Alaska's largest gold prospect appeared to have stalled amid lawsuits and questions about costs.
Now, a $1 billion deal could inject new life into the massive Donlin gold project in Western Alaska.
That's the message, at least, from the investors who are doubling down on Donlin, including two prominent East Coast billionaires. They say they're more motivated to push the project toward production than the global mining giant that just pulled out.
In a sale announced this week, Barrick Gold Corp., one of the world's most prolific gold mining companies, will give up its half of Donlin.
Paulson Advisers, a Florida-based firm led by financier John Paulson, is paying Barrick $800 million for 40 percent of the project.
The remaining 10 percent will go to Novagold Resources for $200 million . Novagold is a publicly-traded company that already owned half of the project and has been working on it alongside Barrick for years.
Barrick, which operates gold and copper mines in the U.S., Africa, South America and the Middle East, brought deep pockets to Donlin, along with expertise as a developer.
But the company also had competing priorities and wasn't pressed to move Donlin from exploration into the multibillion-dollar construction phase, Novagold's chairman, Thomas Kaplan, said at a briefing this week.
Donlin, which is one of the world's largest gold prospects, is gaining deeper backing from Paulson, a longtime investor in the metal who already owned shares in Novagold. He says he's poised to bring not only new cash to the project but also fresh intent to speed it along.
'Our goal is to immediately advance this project toward production,' Paulson said at the briefing.
A coveted, contentious deposit
Donlin has been studied for years and Novagold estimates that it contains deposits of gold worth more than $100 billion. Boosters consider the project to be one of Alaska's most promising deposits, given its sheer size. But it's also one of the most contentious.
Its developers enjoy considerable support from elected officials and Alaska Native-owned corporations, which own the land where Donlin sits. They see the project as an opportunity to create hundreds of jobs and generate revenue for local governments and Indigenous shareholders.
But Donlin faces staunch opposition from several tribal governments as well as regional and statewide conservation groups. They fear the effects of a large-scale mine in a remote region where people have long depended on salmon and other wildlife and traditional foods.
Paulson's investment comes as four separate lawsuits over Donlin's state and federal permits work their way through the courts — and as questions linger about the economics and logistics of powering a sprawling, open-pit operation. The mine would be built on tundra near the upper reaches of the Kuskokwim River, far from existing roads and the electricity grid.
The Donlin prospect sits on land owned by Alaska Native corporations. (Donlin Gold via The Northern Journal)
Donlin is almost fully permitted but has not moved into construction in part, according to its new owners, because Novagold and Barrick weren't aligned on how quickly to proceed.
Traditionally a gold company, Barrick has recently shifted its focus to copper — a key component for electric cars and other modern technologies that some investors consider a more strategic, long-term bet. Barrick has appeared more interested in developing copper mines in other countries than in advancing Donlin, according to industry observers.
'I think what held (Donlin) back in the past was Barrick, through no fault of their own,' Paulson said. 'They had many projects around the world. And Donlin was somewhat of an orphan asset.'
Market analysts at Jefferies, a New York investment bank, echoed Paulson in their own review of the deal.
'From what we could tell, Donlin was not a priority in Barrick's portfolio — not anytime soon, anyway — and so we are not surprised by the sale,' the review said.
The analysts added, however, that the deal appears to have come at the right time for Barrick because of rising gold prices — which likely boosted Donlin's value.
Gold has hit repeated record-high prices in recent months and is now selling at more than $3,300 per ounce, up some 30 percent this year.
Barrick appears poised to use cash from the sale to invest in its other mines. In a press release , the company's chief executive, Mark Bristow, said Donlin 'might be better suited in the hands of others, while we pursue our priority portfolio of Barrick-managed growth projects.'
A Barrick spokesperson declined to comment further.
Kaplan, Novagold's chairman, said he harbors no ill will toward Barrick and looks forward to celebrating the Donlin deal with Bristow 'over a bottle or two or three of very, very fine Bordeaux.' He also said at the briefing, perhaps jokingly, that he almost named one of his children Donlin.
Kaplan himself is a billionaire investor, who, like Paulson, has long been known for his enthusiasm for gold. His firm, The Electrum Group, invested in Novagold over a decade ago and is now the company's largest shareholder. The Wall Street Journal reported this week that Kaplan made multiple attempts to buy Barrick's half of Donlin over the past 15 years.
'Donlin for me was the Holy Grail,' Kaplan told the Journal.
Novagold's stock has jumped nearly 60 percent since the sale was announced, in a sign that investors view it as a good deal.
Along the Kuskokwim River, downstream of the Donlin prospect and thousands of miles from Wall Street, the deal elicited a range of opinions. Some said they hadn't heard about the project's change in ownership. Others said it made no difference to their opposition.
'It's scary and frustrating,' said Beverly Hoffman, an elder in Bethel, a Kuskokwim River town and regional hub. As someone who 'depends on the food resources to sustain our way of life,' Hoffman said in a phone interview, 'it angers me that this money can just be thrown around."
The Donlin prospect sits above Western Alaska's Kuskokwim River, pictured here. (Nathaniel Herz, Northern Journal)
Hoffman co-founded Mother Kuskokwim Tribal Coalition, a regional advocacy group that's fighting Donlin. She said she'd like Paulson, the investor, to come visit her in Bethel.
'I'll take him out in a boat,' she said. 'I would love to talk salmon with him. I would love to talk birds and berries."
Like many Bethel residents, Hoffman is a shareholder of the regional, Indigenous-owned company Calista Corp., which owns rights to the minerals at Donlin.
The corporation, which selected those lands for their mineral potential under the 1971 Alaska Native Claims Settlement Act, has strongly supported Donlin, given its potential to pay royalties to Calista and create jobs for shareholders.
'Although there's this news about a planned ownership change, our vision and our priorities at Calista have not changed,' said Vice President of Corporate Affairs Thom Leonard.
Calista periodically meets with Donlin's owners, has had a 'very positive' history with Novagold and doesn't expect that to change, Leonard added. 'We're ready to move forward when it's proven and we believe that it's safe to do so.'
A politically connected investor
It still might be too early to say exactly how the sale will affect the mine's prospects, according to Brett Watson, an economist at University of Alaska Anchorage who follows the industry closely.
Watson is waiting to see what changes Novagold and Paulson make to Donlin's operations this year, and how quickly the owners move to update their economic analysis of the project.
Before Barrick's sale, Donlin had announced plans to spend $43 million on exploratory drilling and other operations this year.
As soon as the deal closes, the new ownership team aims to begin a key step toward construction: an $80 million, two-year update of an existing economic study of Donlin, said Novagold's chief executive, Greg Lang.
Donlin is already halfway done with its planned drilling for the year, he added. Once the sale is finalized, Lang said in an interview, Novagold and Paulson will look to expand Donlin's budget, 'if appropriate.'
Paulson originally gained fame by making billions of dollars in a bet against the U.S. housing market leading up to the 2008 financial crisis.
Since then, Paulson has poured large sums into mining, becoming one of the country's highest-profile gold investors.
His firm holds a roughly 35 percent stake in Perpetua Resources, which is building a large mine in Idaho with support from the Trump administration. That project targets gold and antimony — an element that's surged in value amid a trade war with China — and it recently has progressed quickly from the study phase toward construction .
'We want to repeat that success we've had with Perpetua, with Donlin,' Paulson said. 'It was a similar mine development as we have here. Only Donlin is much larger.'
Paulson & Co., Paulson's family investment office, has other mining interests in Alaska, though the billionaire has largely stayed behind the scenes.
They include a one-third stake in International Tower Hill Mines, a small company looking to develop a gold deposit north of Fairbanks. The firm also owns nearly 9 percent of Trilogy Metals, which is seeking to build a copper mine near the end of the controversial, state-proposed Ambler Road in remote Northwest Alaska.
Beyond investing, Paulson is known for his ties to President Donald Trump. He donated millions of dollars to Trump's presidential campaign and hosted a fundraiser last year at his home in Palm Beach, Florida. He was floated last year as a potential U.S. treasury secretary pick.
A spokesperson for Paulson referred a request for comment to Novagold.