International Tower's proximity to Kinross' Fort Knox mine is also a big plus because one can see what Tower Hill can grow into. Kinross has been successful at producing low grade profitable gold.

In the third quarter, Fort Knox produced 108,680 ounces of gold and gold equivalents with a grade of 0.96 for $501 cash costs. After expanding the project, Kinross is expecting to produce an average of 370,000 ounces of gold per year from 2010-2015. It has proven and probable reserves of 3.7 million ounces.

NovaGold, on the flip side, has limited infrastructure and, according to the company's Web site, needs a river port; an access road connecting the port and Donlin; an airstrip, mine and plant site area; and gas and power facilities. The company is planning to build a natural gas pipeline to save on future costs and is in the process of updating its feasibility study with revised capital and operating costs factoring in the pipeline. The new energy input should shave off $50 from its cash costs.

NovaGold must also contend with local communities and has had to work hard at maintaining good relationships with them. Donlin still has to go through the permitting process, full Environmental Protection Agency process and a full blown environmental impact statement.

International Tower has the same permitting process ahead of it, but its nearest community is 40 miles away, making it less susceptible to environmental issues.

Handwerger says for someone wanting to invest in Alaska, International Tower Hill makes the most sense. "The problem with the two other major projects is that they are in western Alaska ... what's around the mine is just as important as what's in the mine." Handwerger was referring to Donlin Creek and the Pebble Project, also in Western Alaska, owned by Northern Dynasty ( NAK).

Investing in gold miners in Alaska is a hot trend. John Paulson's fund owns 9% of NovaGold and is the second-largest shareholder. George Soros' fund is the fourth-largest investor.

Paulson also owns 6% of International Tower and is the third-largest shareholder following AngloGold ( AU), which owns 11.3% of the company.

As institutional investors pile in, its temping for retail investors to follow suit just know there are multiple options out there before you pull the trigger.


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-- Written by Alix Steel in New York.

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Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.

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