Novagold Resources Inc. · AMEX:NG
Novagold Resources — Q3 2015 Earnings Presentation
23 slides from Novagold Resources's earnings presentation, Oct 7, 2015
Slide 1: 2015 Third Quarter & Project Update
2015 Third Quarter & Project Update NYSE-MKT, TSX: NG | October 2015 novagold.com
Slide 2: Conference Call Attendees
CONFERENCE CALL ATTENDEES > Introduction Mélanie Hennessy (Vice President Corporate Communications) > Corporate Update Greg Lang (President & Chief Executive Officer) > Third Quarter Financials & 2015 Budget David Ottewell (Vice President & Chief Financial Officer) > Closing Remarks Greg Lang (Presi
Slide 3: Cautionary Statements Regarding Forward-Looking Statements
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 historic
Slide 4: What Makes NOVAGOLD Unique?
WHAT MAKES NOVAGOLD UNIQUE? A DEVELOPMENT-STAGE COMPANY WITH TWO PROJECTS OF EXCEPTIONAL SCALE, QUALITY, AND JURISDICTIONAL SAFETY DONLIN GOLD 50/50 with Barrick Poised to become one of the largest gold producers in the world GALORE CREEK 50/50 with Teck Expected to be the largest and lowest cost co
Slide 5: Third Quarter Activities: Project Permitting Is On Track
THIRD QUARTER ACTIVITES: PROJECT PERMITTING IS ON TRACK DEVELOPMENT & ENVIRONMENTAL IMPACT STATEMENT/PERMITTING TIMELINE 16 years ̴5 ̴4 27+ years ENVIRONMENTAL STUDIES 1.5 Moz/year first five full years1 EXPLORATION & ENGINEERING & CONSTRUCTION PERMITTING OPERATION 1.1 Moz/year life of mine1 August
Slide 6: Third Quarter Activities: Permitting & Technical Studies
THIRD QUARTER ACTIVITES: PERMITTING & TECHNICAL STUDIES DONLIN GOLD – NATIONAL ENVIRONMENTAL POLICY ACT (NEPA) > Preliminary draft EIS review completed by cooperating agencies • Agency comments were constructive, strengthening the analysis of the project’s potential environmental impacts • Donlin Go
Slide 7: Third Quarter Activities: Community Outreach & Workforce Development
THIRD QUARTER ACTIVITES: COMMUNITY OUTREACH & WORKFORCE DEVELOPMENT DONLIN GOLD: PLAYING AN ACTIVE ROLE IN THE YUKON-KUSKOKWIM (Y-K) REGION > Donlin Gold delivered project updates, safety messages and lifejackets in over 50 villages across the Y-K region • Partnered with the Kid’s Don’t Float Campai
Slide 8: Q3-2015 Project Activity
Q3-2015 PROJECT ACTIVITY > Donlin Gold o Activities focused on advancing the draft EIS scheduled to be published by year-end o Continued to advance other major permit applications with state and federal permitting agencies o Community engagement and workforce development initiatives o Project fundin
Slide 9: Q3-2015 Operating Performance Analysis
Q3-2015 OPERATING PERFORMANCE ANALYSIS Q3 Highlights Three months ended Nine months ended (US$ millions) August 31, 2015 August 31, 2015 General and administrative expenses(1) $4.1 $15.7 Projects: Donlin Gold 2.7 8.9 Galore Creek (0.3) 0.1 Donlin Gold studies 0.1 0.4 Operating loss 6.6 25.1 Other (i
Slide 10: Q3-2015 Cash Flow Highlights
Q3-2015 CASH FLOW HIGHLIGHTS Q2 Highlights Three months ended Nine months ended (US$ millions) August 31, 2015 August 31, 2015 Cash used in operating activities(1) $ (1.7) $ (9.9) Project funding: Donlin Gold (2.7) (8.7) Galore Creek (0.1) (0.5) Repayment of convertible notes -- (15.8) Foreign excha
Slide 11: Donlin Gold: A Large High-Grade Gold Project
DONLIN GOLD: A LARGE HIGH-GRADE GOLD PROJECT AMONG THE WORLD’S MOST SIGNIFICANT AND HIGHEST-GRADE GOLD DEPOSITS RESERVES1 34 Moz Proven & Probable Grade: 2.09 g/t RESOURCES1,2 39 Moz Measured & Indicated (inclusive of P&P reserves) Grade: 2.24 g/t 6 Moz Inferred Grade: 2.02 g/t Notes: 1) Shown on 10
Slide 12: Donlin Gold: The Emerging Top-Tier Producer in the Safest Jurisdiction
DONLIN GOLD: THE EMERGING TOP-TIER PRODUCER IN THE SAFEST JURISDICTION A REMARKABLE RESOURCE AMONG EMERGING OPEN-PIT GOLD DEPOSITS 45.0 40.0 35.0 > Donlin Gold’s size and production profile clearly distinguish it from 30.0 its peers (millions of ounces) M&I Gold Resource 25.0 20.0 39.0 15.0 10.0 21.
Slide 13: Donlin Gold: Double the Grade of the Average Gold Deposit
DONLIN GOLD: IS DOUBLE THE GRADE OF THE AVERAGE GOLD DEPOSIT IN THE WORLD DONLIN GOLD’S HIGH GRADE ENDOWMENT PROVIDES RESILIENCE TO GOLD PRICE CYCLES Donlin Gold Average Grade2: World Average Grade1: 2.24 g/t 1.12 g/t Industry average grades are declining and sources for emerging production are incr
Slide 14: Donlin Gold: Excellent Exploration Potential
DONLIN GOLD: EXCELLENT EXPLORATION POTENTIAL MULTIPLE DRILL PROSPECTS AND TARGETS EXIST ALONG 8KM TREND 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 a
Slide 15: Why Donlin Gold? No New Substantial Discoveries
WHY DONLIN GOLD? NO NEW SUBSTANTIAL DISCOVERIES IN LESS THAN FIVE YEARS WORLD GOLD PRODUCTION IS EXPECTED TO DECLINE BY APPROXIMATELY 12 MILLION OUNCES 16 Gold Discovered $10,000 Exploration Budget (US$ in millions) $9,000 14 $8,000 12 $7,000 Number of Gold Discoveries 10 2012 $6,000 highest year on
Slide 16: Donlin Gold: Significant Value Upside with Higher Gold Prices
DONLIN GOLD: SIGNIFICANT VALUE UPSIDE WITH HIGHER GOLD PRICES NPV INCREASES ~20X WITH ~2X INCREASE IN GOLD PRICE NPV (US$ in millions) 30,000 > Project has a positive return 27year 27.0B that increases substantially with higher gold prices 25,000 > Good payback at a mine life 20,000 19.2B broad rang
Slide 17: Donlin Gold: Strong Partnerships with Local Stakeholders
DONLIN GOLD: STRONG PARTNERSHIPS WITH LOCAL STAKEHOLDERS ALASKA NATIVE CORPORATIONS: LEADERS OF REGIONAL ECONOMIC DEVELOPMENT > ANCSA established 40 years ago; resolved Alaska Native land claims > Lands valuable for resource potential selected by Regional Corporations under ANCSA > Native corporatio
Slide 18: 2015 Focus
2015 FOCUS CONTINUE TO EXECUTE AND DELIVER ON OUR BUSINESS PLAN > Advance Donlin Gold permitting to a construction decision > Maintain strong relationships with all stakeholders > Advance Galore Creek mine planning and project design > Monetize the value of Galore Creek > Safeguard our cash position
Slide 19: Why NOVAGOLD Why Now
WHY NOVAGOLD WHY NOW Safe Geo-Political Environment: Strong Balance Sheet: Alaska and British Columbia, $130m cash + term deposits top-rated mining jurisdictions as of August 31, 2015 NOVAGOLD focused on execution and delivery of our business plan Top Tier Assets: Accomplished Team: Donlin Gold: Lar
Slide 20: Appendix
APPENDIX novagold.com
Slide 21: NOVAGOLD: Reserve/Resource Table
NOVAGOLD: RESERVE/RESOURCE TABLE 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 3
Slide 22: NOVAGOLD: Reserve/Resource Table (Con't)
NOVAGOLD: RESERVE/RESOURCE TABLE (CON’T) 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 a
Slide 23: Contact Us
CONTACT US 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 [email protected] Mélanie Hennessey Erin O’Toole VP, Corporate Communications Analyst, Investor Relations [email protected]