novagold q2-2015 financials and project update
TRANSCRIPT
novagold.com
NYSE-MKT, TSX: NG | July 2015
2015 Second Quarter & Project Update
Conference Call Attendees
2
▶ Introduction
Mélanie Hennessy (Vice President Corporate Communications)
▶ Corporate Update
Greg Lang (President & Chief Executive Officer)
▶ Second Quarter Financials & 2015 Budget
David Ottewell (Vice President & Chief Financial Officer)
▶ Closing Remarks
Greg Lang (President & Chief Executive Officer)
▶ Question & Answer Session
Greg Lang & David Ottewell
Cautionary Statements
REGARDING FORWARD-LOOKING STATEMENTS
This presentation includes certain “forward-looking statements” within the meaning of applicable securities laws, including the United States Private Securities Litigation Reform Act of 1995. All
statements, other than statements of historical fact, included herein including, without limitation, statements relating to Donlin Gold’s future operating or financial performance, are forward-
looking statements. Forward-looking statements are frequently, but not always, identified by words such as “plans”, “expects”, “anticipates”, “believes”, “intends”, “estimates”, “potential”,
“possible” and similar expressions, or statements that events, conditions or results “will”, “may”, “could”, or “should” occur or be achieved. These forward-looking statements are set forth in the
slides pertaining to the implementation of the Donlin Gold second updated Feasibility Study and pertaining to the implementation of the Galore Creek Pre-Feasibility Study, the factors that may
influence future gold price performance, and the potential future value of gold, and may include statements regarding perceived merit of properties; exploration results and budgets; mineral
reserves and resource estimates; work programs; capital expenditures; timelines; strategic plans; completion of transactions; market price of precious or base metals; or other statements that
are not statements of fact. Forward-looking statements involve various risks and uncertainties. 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 our expectations include the
uncertainties involving the need for additional financing to explore and develop properties and availability of financing in the debt and capital markets; uncertainties involved in the interpretation
of drilling results and geological tests and the estimation of reserves and resources; the need for continued cooperation between NOVAGOLD and Barrick Gold in the exploration and
development of the Donlin Gold property; the need for continued cooperation between NOVAGOLD and Teck Resources Ltd. in the exploration and development of the Galore Creek property;
the need for cooperation of government agencies and native groups in the development and operation of properties; the need to obtain permits and governmental approvals; risks of
construction and mining projects such as accidents, equipment breakdowns, bad weather, non-compliance with environmental and permit requirements, unanticipated variation in geological
structures, ore grades or recovery rates; unexpected cost increases; fluctuations in metal prices and currency exchange rates; and other risks and uncertainties disclosed in reports and
documents filed by NOVAGOLD with applicable securities regulatory authorities from time to time. The forward-looking statements made herein reflect our beliefs, opinions and projections on
the date the statements are made. Except as required by law, we assume no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they
change.
REGARDING SCIENTIFIC AND TECHNICAL INFORMATION
Unless otherwise indicated, all reserve and resource estimates included in this presentation have been prepared in accordance with Canadian National Instrument 43-101 Standards of
Disclosure for Mineral Projects (“NI 43-101”) and the Canadian Institute of Mining, Metallurgy and Petroleum Definition Standards for Mineral Resources and Mineral Reserves (“CIM Definition
Standards”). Canadian standards, including NI 43-101, differ significantly from the requirements of the United States Securities and Exchange Commission (“SEC”), and reserve and resource
information in this presentation may not be comparable to similar information disclosed by U.S. companies. In particular, and without limiting the generality of the foregoing, the term “resource”
does not equate to the term “‘reserves”. Under U.S. standards, mineralization may not be classified as a “reserve” unless the determination has been made that the mineralization could be
economically and legally produced or extracted at the time the reserve determination is made. At this time, both of Donlin Gold and Galore Creek projects are without known reserves, as
defined under SEC Industry Guide 7. The SEC’s disclosure standards normally do not permit the inclusion of information concerning “measured mineral resources”, “indicated mineral
resources” or “inferred mineral resources” or other descriptions of the amount of mineralization in mineral deposits that do not constitute “reserves” by U.S. standards in documents filed with the
SEC. U.S. investors should also understand that “inferred mineral resources” have a great amount of uncertainty as to their existence and great uncertainty as to their economic and legal
feasibility. It cannot be assumed that all or any part of an “inferred mineral resource” will ever be upgraded to a higher category. Under Canadian rules, estimated “inferred mineral resources”
may not form the basis of feasibility or pre-feasibility studies except in rare cases. Investors are cautioned not to assume that all or any part of an “inferred mineral resource” exists or is
economically or legally mineable. Disclosure of “contained ounces” in a resource is permitted disclosure under Canadian regulations; however, the SEC normally only permits issuers to report
mineralization that does not constitute “reserves” by SEC standards as in-place tonnage and grade without reference to unit measures. The requirements of NI 43-101 for identification of
“reserves” are also not the same as those of the SEC, and reserves reported in compliance with NI 43-101 may not qualify as “reserves” under SEC standards. Accordingly, information
concerning mineral deposits set forth herein may not be comparable to information made public by companies that report in accordance with United States standards.
All dollar amounts quoted in this report are in U.S. currency unless otherwise noted.
3
What Makes NOVAGOLD Unique?
Poised to become one of the
largest gold producers in the
world
DONLIN GOLD
GALORE CREEK
Expected to be the largest and
lowest cost copper mine in
Canada
50/50 with Barrick
50/50 with Teck
A DEVELOPMENT-STAGE COMPANY WITH TWO PROJECTS OF EXCEPTIONAL SCALE,
QUALITY, AND JURISDICTIONAL SAFETY
4
Notice of Intent to Prepare EIS
Draft EIS
Final EIS Record of Decision
Initial permit applications Submitted: 08/12
Notice of intent Issued: 12/14/12
Public scoping period Ended: 03/29/13
Scoping summary document Completed: 08/13
Development of alternatives
Completed: Q2/14
Initial drafts of EIS chapters Completed: Q4/14
Agency & Donlin Gold review Completed: Q4/14
Preliminary draft EIS
Publish draft EIS
Public comment period
Prepare draft final EIS
Agency review
Publish final EIS
Record of decision
2012-2013 2013-2015 2015-2017
PAST THE HALFWAY MARK IN THE EIS PROCESS
Second Quarter Activities - Donlin Gold Permitting Milestones
5
ADVANCING OUR PROJECTS WHILE SAFEGUARDING OUR BALANCE SHEET
Second Quarter Activities
6
▶ Donlin Gold - National Environmental Policy Act (NEPA)
Completed major step in EIS permitting process
• Corps addressed comments on initial drafts and released preliminary draft EIS
for agency review
• Agency comments were focused on clarifying aspects of the EIS to efficiently
communicate the potential effects of the project
• Corps anticipates publishing draft EIS for public comment around year-end 2015
Other major permit applications
• Air quality permit
• Water discharge and use permits
• Rights-of-way and lease applications for the gas pipeline
• Dam engineering, evaluation and authorization
• Clean Water Act section 404
▶ Galore Creek – Advanced Technical Studies
• Advance project mine planning and design to improve value and marketability
• Expression of interest was issued for a study on the proposed access tunnel into
the Galore Valley
Achievements – Permitting and Technical Studies
CONTINUED AND EXTENSIVE LOCAL OUTREACH AND ENGAGEMENT
Second Quarter Activities
▶ Remained actively engaged in sponsorship activities at the
community level in Alaska
• Completed 18 out of 31 planned village outreach visits year-to-
date
• Participated in the Clean Up Green Up community health initiative
• 2nd Annual Academic and Trades Decathlon in Aniak
▶ Calista Corporation visited the Goldstrike mine in Nevada
• Opportunity to see a large scale gold operation with similar mining
and processing equipment to what is envisioned for Donlin Gold
▶ Released second segment of the Alaska Video Series:
Subsistence Way of Life
• The videos document both the vibrant and challenging realities of
living in remote communities of the Y-K region, where Donlin Gold
is located, and the importance of preserving traditional ways of life
Achievements – Community Outreach & Workforce Development
7
Q2-2015 Project Activity
▶ Donlin Gold
o Activities remained focused on the draft EIS and other major permit applications with
state and federal permitting agencies
o Joint optimization studies with Barrick underway ($1.5 million, NG 50% share)
o Continued community engagement initiatives
o Project funding (NG 50% share)
• Q2: $3.6 million
• YTD: $6.0 million
• FY: $12.6 million
▶ Galore Creek
o Technical studies with Teck, focusing on advancing mine planning and project design
o Project funding (NG 50% share)
• Q2: $0.3 million
• YTD: $0.4 million
• FY: $1.6 million
8
Q2-2015 Operating Performance Analysis
Q2 Highlights
(US$ millions)
Three months
ended
May 31, 2015
Six months
ended
May 31, 2015
General and administrative expenses(1) $3.2 $11.6
Projects:
Donlin Gold 3.6 6.2
Galore Creek 0.3 0.4
Donlin Gold studies 0.2 0.3
Operating loss 7.3 18.5
Other (income) expense 1.9 --
Net loss $9.2 $18.5
(1) Includes share-based compensation expense of $0.7 million and $6.1 million for the first three and six months
ended May 31, 2015, respectively. 9
Q2-2015 Cash Flow Highlights
Q2 Highlights
(US$ millions)
Three months
ended
May 31, 2015
Six months
ended
May 31, 2015
Cash used in operating activities(1) $ (2.6) $ (8.2)
Project funding:
Donlin Gold (3.6) (6.0)
Galore Creek (0.3) (0.4)
Repayment of convertible notes (15.8) (15.8)
Foreign exchange effect on cash -- (0.2)
Decrease in cash and term deposits (22.3) (30.6)
Cash and term deposits
Beginning 157.0 165.3
Ending $134.7 $134.7
10 (1) Includes $0.2 million and $0.3 million for the first three and six months ended May 31, 2015, respectively, for joint Donlin Gold
studies with Barrick.
Notes:
1) Shown on 100% project basis, of which NOVAGOLD holds a 50% interest
2) Measured and indicated resources inclusive of proven and probable reserves.
See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource
Base” with footnotes in the appendix.
RESERVES1
34 Moz Proven & Probable
Grade: 2.09 g/t
RESOURCES1,2
39 Moz Measured & Indicated
Grade: 2.24 g/t
6 Moz Inferred
Grade: 2.02 g/t
(inclusive of P&P reserves)
AMONG THE WORLD’S MOST SIGNIFICANT AND HIGHEST-GRADE GOLD DEPOSITS
11
Donlin Gold: A Large High-Grade Gold Project
A REMARKABLE RESOURCE AMONG EMERGING OPEN-PIT GOLD DEPOSITS
Donlin Gold: The Emerging Top-Tier Producer in the Safest Jurisdiction
0.00
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
Donlin Gold Metates PascuaLama
Livengood Blackwater CourageousLake
Mt. Todd Merian Morelos Stibnite Rainy River CerroMaricunga
DublinGulch
Haile
1.102
0.66 0.64 0.58 0.41 0.39 0.37 0.35 0.34 0.34
0.23 0.23 0.21 0.13
1.501
Pro
jecte
d A
nn
ua
l G
old
Pro
du
cti
on
(mil
lio
ns
of
ou
nc
es)
Notes:
• Peer group data as per latest company documents, public filings and websites. Comparison group based on large (M&I+P&P 4Moz cut off), North/South American and Oceanian gold-focused development projects where the
majority of the M&I resource is open-pit.
• Donlin Gold data as per the second updated feasibility study effective November 18, 2011, as amended January 20, 2012. Represents 100% of measured and indicated resources of which NOVAGOLD’s share represents
50%. Measured and indicated resources inclusive of proven and probable reserves. See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource Base” with footnotes in the appendix.
(1) Projected annual gold production during first five full years of mine life; (2) Projected annual gold production during full life of mine.
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
Donlin Gold PascuaLama
Metates Livengood Blackwater CourageousLake
Mt. Todd Rainy River Stibnite Merian CerroMaricunga
Morelos Dublin Gulch Haile
39.0
21.8 19.0
15.7
9.2 8.0 7.8 6.4 5.5 5.5 5.2 5.0 4.9 4.0
M&
I G
old
Reso
urc
e
(mil
lio
ns
of
ou
nc
es)
▶ Donlin Gold’s size and production profile clearly
distinguish it from its peers
12
Notes:
See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource Base” with footnotes in the appendix.
1) Average grade of all deposits globally over 1 Moz in size, sourced from “2013 Global Gold Mine and Deposit Rankings” – Natural Resource Holdings and Visual Capitalist.
2) Donlin Gold data as per the second updated feasibility study effective November 18, 2011, as amended January 20, 2012. Represents 100% of measured and indicated resources of which NOVAGOLD’s share is 50%.
Measured and indicated resources are inclusive of proven and probable reserves.
World Avg. Grade1:
1.01 g/t
Donlin Gold Avg. Grade2:
2.24 g/t
Reserve grades continue to decline while
sources for emerging production to replace
mined-out capacity have become
increasingly scarce
DONLIN GOLD’S HIGH GRADE ENDOWMENT PROVIDES RESILIENCE TO GOLD PRICE CYCLES
Donlin Gold: Is More than Double the Grade of the Average Gold Deposit in the World
13
MULTIPLE DRILL PROSPECTS AND TARGETS EXIST ALONG 8KM TREND
Donlin Gold: Excellent Exploration Potential
14
The next big gold discovery?
▶ Potential to expand current open-pit
resources along strike and at depth
▶ Good prospects to discover meaningful
deposits outside current mine footprint
• Reserves and resources are
contained within just 3 km of an 8 km
long trend
▶ Inferred mineral resource: 6 Moz of gold
mainly inside the reserve pit
• Upside potential to project economics
▶ In-pit area covers 1,600 acres (~2%) of
the 80,000 acres comprising the entire
land package
0
5,000
10,000
15,000
20,000
25,000
30,000
1,200 1,300 1,500 1,700 2,000 2,500
6.2B
8.2B
11.6B
14.6B
19.2B
27.0B
NP
V (
US
$ i
n m
illi
on
s)
Gold Price (US$)
NPV INCREASES ~20X WITH ~2X INCREASE IN GOLD PRICE
Donlin Gold: Significant Value Upside with Higher Gold Prices
15 Notes:
Donlin Gold estimates as per the second updated feasibility study effective November 18, 2011, as amended January 20, 2012 . All dollar figures are in USD and reflect after-tax net present value (at a 0% and 5% discount
rates) of the Donlin Gold project as of 1/1/2014. At a 5% discount rate, the net present value is: $547 m @ $1,200 gold; $1,465m @ $1,300 gold; $3,147m @ $1,500 gold; $4,581 m @ $1,700 gold; $6,722 m @ $2,000 gold;
and $10,243 m @ $2,500 gold. Project development costs prior to 1/1/2014 are treated as sunk costs.
27year mine life
NPV at 0% NPV at 5%
▶ Project has a positive
return that increases
substantially with higher
gold prices
▶ Good payback at a
broad range of gold prices
▶ Significant exploration
upside on the mineralized
trend
▶ Long mine life offers high
likelihood of enjoying one
or more cyclical bull
markets over the period of
the mine’s operation
LOCATION, LOCATION, LOCATION
Donlin Gold: Leverage in a Place Where You Can Keep the Rewards
16
Alaska’s jurisdictional appeal is comprised of five cornerstones:
Donlin Gold is one of only a handful of large
projects located in a safe jurisdiction
▶ Mineral potential
▶ Established mining industry
▶ Political and social stability
▶ Excellent local partnerships
and, of “existential
importance”...
▶ A full embrace of the rule of
law
Donlin Gold: Consistently Advancing the Project
0
10
20
30
40
50
60
2008 2009 2010 2011 2012 2013 2014 2015F
53
21
42
45
37
24
28 25
CO-OWNERS COMMITTED TO MOVING DONLIN GOLD THROUGH PERMITTING TO A
CONSTRUCTION DECISION AT A MEASURED PACE
17
Pro
ject
Fu
nd
ing
on
100%
basis
(U
S$ M
illio
ns)
Notes:
The data presented above is as per NOVAGOLD’s public disclosures. The Donlin Gold LLC, formed in December 2007, is owned 50/50 by Barrick Gold Corporation and NOVAGOLD. NOVAGOLD
contributed 50% of project funding shown above.
Filed Donlin
Gold FS adding
14.7Moz
Optimization
studies
completed,
reserves up
by 4.3Moz
Updated FS,
resources
increased
135% from
2006
FS approved,
permitting
commenced
Initial draft EIS
completed Anticipate
publishing
draft EIS
Donlin Gold
FS completed
Public
scoping
completed
CONTINUE TO EXECUTE AND DELIVER ON OUR BUSINESS PLAN
2015 Outlook
1 2 3 4 5 PRIORITY PRIORITY PRIORITY PRIORITY PRIORITY
Advance
Donlin Gold
permitting
to a
construction
decision
Advance
Galore Creek
mine
planning
and project
design
Evaluate
opportunities
to monetize
the value of
Galore Creek
Safeguard
our cash
position
Maintain
strong
relationships
with all
stakeholders
COMMITTED TO GOLD THROUGH VARIOUS
MARKET CYCLES 18
novagold.com
Appendix
NOVAGOLD: Reserve/Resource Table
20
Donlin Gold (100% basis)* Tonnage Grade Metal content GOLD Kt g/t Au Koz Au
Reserves1 Proven 7,683 2.32 573 Probable 497,128 2.08 33,276 P&P 504,811 2.09 33,849 Resources3, inclusive of Reserves Measured 7,731 2.52 626 Indicated 533,607 2.24 38,380 M&I 541,337 2.24 39,007 Inferred 92,216 2.02 5,993 Galore Creek (100% basis)* Tonnage Grade Metal content COPPER Mt % Cu Blb Cu
Reserves2 Proven 69.0 0.606 0.9 Probable 459.1 0.582 5.9 P&P 528.0 0.585 6.8 Resources4, exclusive of Reserves Measured 39.5 0.25 0.22 Indicated 247.2 0.34 1.85 M&I 286.7 0.33 2.07 Inferred 346.6 0.42 3.23 GOLD Mt g/t Au Moz Au
Reserves2 Proven 69.0 0.520 1.15 Probable 459.1 0.291 4.30 P&P 528.0 0.321 5.45 Resources4, exclusive of Reserves Measured 39.5 0.39 0.50 Indicated 247.2 0.26 2.04 M&I 286.7 0.27 2.53 Inferred 346.6 0.24 2.70 SILVER Mt g/t Ag Moz Ag
Reserves2 Proven 69.0 4.94 11.0 Probable 459.1 6.18 91.2 P&P 528.0 6.02 102.1 Resources4, exclusive of Reserves Measured 39.5 2.58 3.27 Indicated 247.2 3.81 30.26 M&I 286.7 3.64 33.54 Inferred 346.6 4.28 47.73
* Mineral reserves are reported
on a 100% basis. NOVAGOLD and
Barrick each own 50% of the
Donlin Gold project. NOVAGOLD
and Teck each own 50% of the
Galore Creek project.
t = metric tonne
oz = ounce
lb = pound
K = thousand
M = million
B = billion
g/t = grams/tonne
Approximate cut-off grades
(see Resource Footnotes):
Donlin Gold Reserves1: 0.57 g/t gold
Resources3: 0.46 g/t gold
Galore Creek Reserves2: C$10.08 NSR
Resources4: C$10.08 NSR
Notes:
a. These resource estimates have been prepared in accordance with NI43-101 and the CIM Definition Standard, unless otherwise noted.
b. See numbered footnotes below on resource information.
c. Rounding as required by reporting guidelines may result in apparent summation differences between tonnes, grade and contained metal content
d. Tonnage and grade measurements are in metric units. Contained gold and silver ounces are reported as troy ounces, contained copper pounds as imperial pounds
Resource Footnotes:
1) Mineral Reserves are contained within Measured and Indicated pit designs, and supported by a mine plan, featuring variable throughput rates, stockpiling and cut-off optimization. The pit designs and mine plan were optimized on diluted
grades using the following economic and technical parameters: Metal price for gold of US$975/oz; reference mining cost of US$1.67/t incremented US$0.0031/t/m with depth from the 220 m elevation (equates to an average mining cost of
US$2.14/t), variable processing cost based on the formula 2.1874 x (S%) + 10.65 for each US$/t processed; general and administrative cost of US$2.27/t processed; stockpile rehandle costs of US$0.19/t processed assuming that 45% of
mill feed is rehandled; variable recoveries by rock type, ranging from 86.66% in shale to 94.17% in intrusive rocks in the Akivik domain; refining and freight charges of US$1.78/oz gold; royalty considerations of 4.5%; and variable pit slope
angles, ranging from 23º to 43º. Mineral Reserves are reported using an optimized net sales return value based on the following equation: Net Sales Return = Au grade * Recovery * (US$975/oz – (1.78 + (US$975/oz – 1.78) * 0.045)) -
(10.65 + 2.1874 * (S%) + 2.27 + 0.19) and reported in US$/tonne. Assuming an average recovery of 89.54% and an average S% grade of 1.07%, the marginal gold cutoff grade would be approximately 0.57 g/t, or the gold grade that would
equate to a 0.001 NSR cutoff at these same values. The life of mine strip ratio is 5.48. The assumed life-of-mine throughput rate is 53.5 kt/d.
2) Mineral Reserves are contained within Measured and Indicated pit designs using metal prices for copper, gold and silver of US$2.50/lb, US$1,050/oz, and US$16.85/oz, respectively. Appropriate mining costs, processing costs, metal
recoveries and inter ramp pit slope angles varying from 42º to 55º were used to generate the pit phase designs. Mineral Reserves have been calculated using a 'cashflow grade' ($NSR/SAG mill hr) cut-off which was varied from year to year
to optimize NPV. The net smelter return (NSR) was calculated as follows: NSR = Recoverable Revenue – TCRC (on a per tonne basis), where: NSR = Net Smelter Return; TCRC = Transportation and Refining Costs; Recoverable
Revenue = Revenue in Canadian dollars for recoverable copper, recoverable gold, and recoverable silver using metal prices of US$2.50/lb, US$1,050/oz, and US$16.85/oz for copper, gold, and silver, respectively, at an exchange rate of
CDN$1.1 to US$1.0; Cu Recovery = Recovery for copper based on mineral zone and total copper grade; for Mineral Reserves this NSR calculation includes mining dilution. SAG throughputs were modeled by correlation with alteration
types. Cash flow grades were calculated as the product of NSR value in $/t and throughput in t/hr. The life of mine strip ratio is 2.16.
3) Mineral Resources are contained within a conceptual Measured, Indicated and Inferred optimized pit shell using the following assumptions: gold price of US$1,200/oz; variable process cost based on 2.1874 * (sulphur grade) + 10.6485;
administration cost of US$2.29/t; refining, freight & marketing (selling costs) of US$1.85/oz recovered; stockpile rehandle costs of US$0.20/t processed assuming that 45% of mill feed is rehandled; variable royalty rate, based on royalty of
4.5% * (Au price – selling cost). Mineral Resources have been estimated using a constant Net Sales Return cut-off of US$0.001/t milled. The Net Sales Return was calculated using the formula: Net Sales Return = Au grade * Recovery *
(US$1200/oz – (1.85 + ((US$1200/oz – 1.85) * 0.045)) - (10.65 + 2.1874 * (S%) + 2.29 + 0.20)) and reported in US$/tonne. Mineral Resources are inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have
demonstrated economic viability. Inferred Resources are in addition to Measured and Indicated Resources. Inferred Resources have a great amount of uncertainty as to their existence and whether they can be mined legally or
economically. It cannot be assumed that all or any part of the Inferred Resources will ever be upgraded to a higher category. See "Cautionary Note Concerning Reserve & Resource Estimates".
4) Mineral resources are contained within a conceptual Measured, Indicated and Inferred optimized pit shell using the same economic and technical parameters as used for Mineral Reserves. Tonnages are assigned based on proportion of
the block below topography. The overburden/bedrock boundary has been assigned on a whole block basis. Mineral resources have been estimated using a constant NSR cut-off of C$10.08/t milled. The Net Smelter Return (NSR) was
calculated as follows: NSR = Recoverable Revenue – TCRC (on a per tonne basis), where: NSR = Diluted Net Smelter Return; TCRC = Transportation and Refining Costs; Recoverable Revenue = Revenue in Canadian dollars for
recoverable copper, recoverable gold, and recoverable silver using silver using the economic and technical parameters mentioned above. The mineral resource includes material within the conceptual M,I&I pit that is not scheduled for
processing in the mine plan but is above cutoff. Mineral Resources are inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. Inferred Resources are in addition to
Measured and Indicated Resources. Inferred Resources have a great amount of uncertainty as to their existence and whether they can be mined legally or economically. It cannot be assumed that all or any part of the Inferred Resources
will ever be upgraded to a higher category. See "Cautionary Note Concerning Reserve & Resource Estimates".
Cautionary Note Concerning Reserve & Resource Estimates
This summary table uses the term “resources”, “measured resources”, “indicated resources” and “inferred resources”. United States investors are advised that, while such terms are recognized and required by Canadian securities laws, the
United States Securities and Exchange Commission (the “SEC”) does not recognize them. Under United States standards, mineralization may not be classified as a “reserve” unless the determination has been made that the mineralization
could be economically and legally produced or extracted at the time the reserve determination is made. Mineral resources that are not mineral reserves do not have demonstrated economic viability. United States investors are cautioned not to
assume that all or any part of measured or indicated resources will ever be converted into reserves. Further, inferred resources have a great amount of uncertainty as to their existence and as to whether they can be mined legally or
economically. It cannot be assumed that all or any part of the inferred resources will ever be upgraded to a higher category. Therefore, United States investors are also cautioned not to assume that all or any part of the inferred resources
exist, or that they can be mined legally or economically. Disclosure of “contained ounces” is permitted disclosure under Canadian regulations, however, the SEC normally only permits issuers to report “resources” as in place tonnage and
grade without reference to unit measures. Accordingly, information concerning descriptions of mineralization and resources contained in this release may not be comparable to information made public by United States companies subject to
the reporting and disclosure requirements of the SEC.
NI 43-101 is a rule developed by the Canadian Securities Administrators, which established standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. Unless otherwise indicated, all
resource estimates contained in this circular have been prepared in accordance with NI 43-101 and the CIM Definition Standards.
Technical Reports and Qualified Persons
The documents referenced below provide supporting technical information for each of NOVAGOLD's projects.
Project Qualified Person(s) Most Recent Disclosure & Filing Date
Donlin Gold Gordon Seibel R.M. SME, AMEC “Donlin Creek Gold Project Alaska, USA, NI 43-101 Technical Report on Second Updated Feasibility Study” effective November 18, 2011, amended January 20, 2012.
Kirk Hanson P.E., AMEC
Galore Creek Jay Melnyk, P.Eng., AMEC “Galore Creek Copper-Gold Project NI 43-101 Technical Report on Pre-Feasibility Study, British Columbia – Canada” effective July 27, 2011.
Greg Kulla, P.Geo., AMEC
Heather White, B.Sc., P.Eng., who is a consultant to NOVAGOLD and a “qualified person” under NI 43-101, has approved the scientific and technical information included in this Reserve and Resource Table.
NOVAGOLD: Reserve/Resource Table (con’t)
21
NOVAGOLD RESOURCES INC.
Suite 720 – 789 West Pender Street
Vancouver, BC
Canada V6C 1H2
T 604 669 6227 TF 1 866 669 6227 F 604 669 6272
www.novagold.com
Mélanie Hennessey
VP, Corporate Communications
Erin O’Toole
Analyst, Investor Relations
Contact Us
22