Northgate Minerals Corporation (TSX: NGX; AMEX: NXG) today reported cash flow from operations of $19,241,000 or $0.08 per diluted common share and net earnings of $9,406,000 or $0.04 per diluted common share for the first quarter of 2007.

• Production of 68,110 ounces of gold and 17.7 million pounds of copper.
• A net cash cost of gold production of $28 per ounce.
• The addition of 175,000 ounces of gold to reserves at Kemess South, extending the mine-life by one year until the fourth quarter of 2010.
• During the quarter, Northgate opportunistically repurchased 30,000 ounces of its gold forward sales position at $612 per ounce reducing its remaining position to only 30,000 ounces.
• Continuing positive drill results at Young-Davidson combined with significant progress on the exploration ramp and shaft dewatering.
• The Kemess South mine was the safest metal mine in British Columbia during the first quarter of 2007.

Ken Stowe, President and CEO, stated; “We are exceptionally pleased to announce a one year extension of the mine-life at Kemess South through the addition of approximately 18 million tonnes of ore to our existing Kemess South reserve.  This mine-life extension provides us with a profitable production bridge to the projected start of operations at Kemess North and Young-Davidson and provides our shareholders with additional fully-permitted exposure to the gold price. Meanwhile, current production at Kemess South continued to roll along on schedule as we produced 68,110 ounces of gold at a net cash cost of only $28 per ounce. At Young-Davidson, our project team has made excellent progress on the underground ramp development, shaft dewatering and various technical studies. In the coming months, the surfaced-based diamond drilling program will be focusing on regions between areas of known resources with the goal of significantly increasing measured and indicated resource ounces by the end of the year.”

RESULTS OF OPERATIONS

Northgate recorded net earnings of $9,406,000 or $0.04 per diluted common share in the first quarter of 2007 compared with earnings of $21,735,000 or $0.10 per share during the corresponding quarter of 2006. Per share data is based on 255,541,281 weighted average diluted number of shares outstanding in the first quarter of 2007 and 215,092,200 in the corresponding period of 2006.  As of May 1, 2007, the Corporation had 254,158,045 issued and outstanding common shares.

Kemess South Mine Performance

The Kemess South mine posted gold and copper production of 68,110 ounces and 17.7 million pounds, respectively, in the first quarter of 2007. While gold production was on target as a result of higher than expected gold grades, copper production was below forecast due to lower than expected mill throughput.  

During the first quarter of 2007, approximately 12.1 million tonnes of ore and waste were removed from the open pit compared to 10.0 million tonnes during the corresponding quarter of 2006 and an average of 10.8 million tonnes per quarter during all of 2006. The increase in total mining volume was driven by mining efficiencies related to higher elevation north wall waste stripping and short hauls of supergene ore to the stockpile. Unit mining costs during the current quarter were Cdn$1.47 per tonne compared with Cdn$1.38 per tonne in the first quarter of 2006. The unit mining cost in the most recent quarter was higher than it was in the same period last year due primarily to extra drilling expenses related to the north wall pushback partially offset by the
higher mining volume.

Mill availability and mill throughput during the first quarter of 2007 were consistent with performance in the same period last year at 91% and 48,238 tonnes per day, respectively, compared with 90% availability and throughput of 48,545 tonnes per day in the first quarter of 2006. However, the ore milled in the first quarter of 2007 was somewhat harder than expected, which resulted in a 6% shortfall in planned throughput. 

Gold and copper recoveries averaged 72% and 86%, respectively, in the first quarter of 2007, compared with 74% and 86% in the first quarter of 2006.  While gold recoveries were slightly lower than one year ago, metallurgical performance in the first quarter of 2007 was generally as good as or better than one year ago when higher grade ores with inherently higher copper and gold recoveries were milled.
 
Metal concentrate inventory increased by 1,000 wet metric tonnes (wmt) in the first quarter of 2007 to approximately 11,000 wmt, increasing the value of concentrate in inventory compared with the December 31, 2006 balance. Lower than anticipated railcar availability due to winter conditions and the CN Rail strike during February resulted in the small inventory build. 

The total site cost of production during the first quarter of 2007 was Cdn$9.65 per tonne milled, which was significantly higher than the Cdn$8.46 per tonne milled in the corresponding period of 2006 due to higher waste stripping and a significant amount of ore that was mined and stockpiled for future processing. Total site operating costs in the first quarter of 2007 were Cdn$41.9 million compared with Cdn$37.0 million in the first quarter of 2006. The increase in total site operating costs resulted from additional costs related to the north wall pushback and general increases in costs for labour, energy and consumables. The net cash cost of production at Kemess in the first quarter was $28 per ounce of gold compared to the $27 per ounce cash cost reported in the first quarter of 2006. The cost was stable from period to period, because increased site costs and lower gold and copper production was offset by reduced concentrate marketing costs and higher copper prices.

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