Northgate Minerals Corporation

Northgate Minerals Corporation

January 11, 2005 17:35 ET

Northgate Projects 280,000 Ounces of Gold Production In 2005


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: NORTHGATE MINERALS CORPORATION

TSX SYMBOL: NGX
AMEX SYMBOL: NXG

JANUARY 11, 2005 - 17:35 ET

Northgate Projects 280,000 Ounces of Gold Production
In 2005

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 11, 2005) - Northgate
Minerals Corporation (TSX:NGX)(AMEX:NXG) (All figures in US dollars
except where noted)

Northgate Minerals Corporation today released the 2005 production
forecast for the Kemess mine.

2005 Plan Highlights

- The Kemess mine is forecast to produce 280,000 ounces of gold and 76
million pounds of copper during 2005.

- The cash cost of production on a fully absorbed basis, net of
by-product credits, is forecast to be $196 per ounce ($145 per ounce
using the Gold Institute methodology).

- Northgate is targeting to have permits in place and financing arranged
by mid-year so that a development decision for Kemess North can be made
during the second half of 2005.

- Exploration spending will increase to approximately $4 million.

Ken Stowe, President and CEO, stated, "In 2004, Northgate delivered
record gold production and cash flow from the Kemess mine, added almost
a year to its reserve base at Kemess South and completed the final
feasibility study on Kemess North, creating a new reserve containing
over four million ounces of gold. A priority in 2005 is to obtain the
necessary permits and financing commitments to allow us to proceed with
the development of Kemess North. At the same time, we are actively
pursuing several corporate initiatives any one of which would have the
potential to substantially increase our annual gold production in the
near term. As we expect metal prices to remain buoyant in 2005, our cash
flow from operations should remain strong as we pursue the acquisition
and development of gold assets that will enhance the value of our
company."

2005 Kemess Mine Operating Parameters

Mine production is forecast to total 50 million tonnes of ore plus waste
with ore being mined primarily from the lower-grade eastern end of the
pit during the first half of the year, and moving to the central and
western regions of the pit in the second half. Mining productivity is
forecast to be 7% lower than it was in 2004 due to longer average haul
distances that result from the deepening of the Kemess South open pit.
The stripping ratio for the year is expected to be 1.88:1 compared to a
life-of-mine average of approximately 0.83:1. Waste stripping in 2005 is
continuing at a higher rate than originally planned, in order to expose
the additional ore reserves that were added at Kemess South during 2004,
extending the life of the pit by almost one year.

Mill throughput is forecast to average approximately 52,500 tonnes per
day with the mill operating at 91% availability. Approximately 3.3
million tonnes of supergene and leach cap ores are scheduled for
processing in the third quarter of the year, roughly the same as was
processed in 2004. Ore processed during 2005 will be approximately 5%
lower in gold and copper than the average Kemess South reserve grade as
the remaining lower-grade ore in the east end of the pit is mined out.
Metal production of 280,000 ounces of gold and 76 million pounds of
copper is anticipated from a record annual mill throughput of 19.2
million tonnes of ore. In 2006 and 2007, when mining occurs primarily in
the western end of the Kemess pit, gold production is expected to exceed
325,000 ounces per year.

Gold Cash Cost

Assuming by-product copper and silver prices of $1.40 per pound and
$6.50 per ounce respectively, and a Cdn$/US$ exchange rate of 1.26, cash
costs are projected to be $196 per ounce of gold produced on a fully
absorbed basis or $145 per ounce using the Gold Institute methodology
employed by the majority of producers in the gold industry. In contrast
to mines using the Gold Institute methodology, the Kemess South cash
cost is projected to decrease dramatically in future years when the
waste-ore stripping ratio drops below the life-of-mine average. During
2005, each $0.04 per pound change in the copper price or $0.025 change
in the US$/Cdn$ exchange rate affects the cash cost by approximately $10
per ounce.

Cast costs at the Kemess mine during 2005 are projected to be higher
than they were in 2004 mainly as a result of a dramatic increase in
concentrate smelting and refining charges ($33/ounce), increased costs
for grinding steel and diesel fuel and lower metal production.



Projected 2005 Kemess Mine Production

(100% of production basis) 2005 2004
-----------------------------------------------------------------

Ore plus waste mined (tonnes) 50,129,000 56,000,000
Ore mined (tonnes) 17,423,000 19,329,000
Stripping ratio (waste/ore) 1.88 1.90

Ore milled (tonnes) 19,168,000 18,589,662
Average mill operating rate (tpd) 52,515 50,791

Gold grade (gmt) 0.641 0.735
Copper grade (%) 0.219 0.231

Gold recovery (%) 71 69
Copper recovery (%) 82.5 83

Gold production (ounces) 280,000 303,475
Copper production (000s pounds) 76,000 78,291

Productivity measures:
Tonnes mined per man-shift 766 826
Tonnes milled per man-shift 293 290

Cash cost ($/ounce):
Full Absorption Method 196 137
Gold Institute Method 145 83
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Quarterly Metal Production

Quarterly gold output in 2005 will average 70,000 ounces. However, as in
past years, quarterly production will vary significantly due to
scheduled variations in the mill feed grade. In 2005, gold production in
the third and fourth quarters is forecast to be substantially above
average, offsetting below average production during the first two
quarters when the remaining lower-grade ore from the eastern region of
the pit is scheduled for processing.



Kemess Mine Quarterly Metal Production Forecast

------------------------------------------------------------------
Total
Q1 Q2 Q3 Q4 2005
------------------------------------------------------------------
Gold (ounces) 52,000 60,000 84,000 84,000 280,000
------------------------------------------------------------------
Copper (millions lbs) 16.5 18.5 18.3 22.7 76,000
------------------------------------------------------------------


Kemess North Permitting

Northgate is proceeding with permitting for the Kemess North mine
development. The permitting process, centered on a joint
Federal/Provincial panel review and various supporting activities, is
funded by Northgate and is expected to cost approximately $2 million to
complete. These costs will be capitalized as part of the Kemess North
project.

Exploration

Exploration spending in 2005 will increase to approximately $4 million.
Approximately $2 million of this total will be allocated to the
continued exploration of the prospective claims surrounding the Kemess
South mine and Kemess North deposit. Diamond drilling will focus
primarily on the Bear claims to the south of the existing Kemess
infrastructure, where several targets were identified during a 2004
geophysical program, and the Kemess North and Nugget areas where
Northgate geologists are trying to delineate additional reserves for the
Kemess North project. The balance of Northgate's exploration budget will
be allocated to Northgate's option/joint venture properties in Western
Canada, including the RDN property, where native silver was discovered
last year and the Sustut copper property.

Corporate Development

In addition to its targeted exploration programs, Northgate is currently
examining a variety of opportunities to increase its near-term gold
production and diversify its production base through the acquisition of
a late-stage project or an operating mine. The ideal acquisition would
be a gold asset in a stable political jurisdiction in the Americas with
the potential to produce at least 100,000 ounces of gold per year.

Northgate Minerals Corporation is a gold and copper mining company
focused on operations and opportunities in the Americas. The
Corporation's principal assets are the 300,000-ounce per year Kemess
mine in north-central British Columbia and the adjacent Kemess North
deposit, which contains a Proven and Probable Reserve of 4.1 million
ounces of gold. Northgate is listed on the Toronto Stock Exchange under
the symbol NGX and on the American Stock Exchange under the symbol NXG.

Forward-Looking Statements

This news release includes certain "forward-looking statements" within
the meaning of section 21E of the United States Securities Exchange Act
of 1934, as amended. These forward-looking statements include estimates,
forecasts, and statements as to management's expectations with respect
to, among other things, future metal production and production costs,
potential mineralization and reserves, exploration results, progress in
the development of mineral properties, demand and market outlook for
commodities and future plans and objectives of Northgate Minerals
Corporation (Northgate). Forward-looking statements generally can be
identified by the use of forward-looking terminology such as "may",
"will", "expect", "intend", "estimate", "anticipate", "believe", or
"continue" or the negative thereof or variations thereon or similar
terminology. Forward-looking statements are necessarily based upon a
number of estimates and assumptions that, while considered reasonable by
management are inherently subject to significant business, economic and
competitive uncertainties and contingencies. There can be no assurance
that such statements will prove to be accurate and actual results and
future events could differ materially from those anticipated in such
statements. Important factors that could cause actual results to differ
materially from Northgate's expectations are disclosed under the heading
"Risk Factors" in Northgate's 2003 Annual Report and under the heading
"Trends, Risks and Uncertainties" in Northgate's 2003 Annual Information
Form (AIF) both of which are filed with Canadian regulators on SEDAR
(www.sedar.com) and with the United States Securities and Exchange
Commission (www.sec.gov). Northgate expressly disclaims any intention or
obligation to update or revise any forward-looking statements whether as
a result of new information, future events or otherwise.

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Northgate Minerals Corporation
    Mr. Ken G. Stowe
    President and Chief Executive Officer
    (416) 216-2772
    or
    Northgate Minerals Corporation
    Mr. Jon A. Douglas
    Senior Vice President and Chief Financial Officer
    (416) 216-2774
    Website: www.northgateminerals.com