Novagold Resources Inc. · AMEX:NG
Novagold Resources — BMO Mining Conference 2016
35 slides from Novagold Resources's conference presentation, Mar 2, 2016
Slide 1: The Gold Development Company for the 21st Century
THE GOLD DEVELOPMENT COMPANY for the 21st Century NYSE-MKT, TSX: NG | March 2016 novagold.com
Slide 2: 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 3: 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 4: Donlin Gold: The Right Project
DONLIN GOLD: THE RIGHT PROJECT ARGUABLY THE MOST IMPORTANT GOLD PROJECT IN THE WORLD TODAY Size Partnerships Among the largest present and/or Strong partnerships with local future gold mines in the world stakeholders Jurisdiction Grade High-grade open-pit mine Donlin Gold Located in Alaska, one of t
Slide 5: 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 6: 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 7: Mines the Size of Donlin Gold Are Scarce
MINES THE SIZE OF DONLIN GOLD ARE SCARCE ONLY FIVE MINES/PROJECTS IN THE WORLD ARE SLATED TO PRODUCE >1 MOZ/YEAR DONLIN GOLD USA ▸ 1.5 Moz/year in first five MURUNTAU Uzbekistan full years1 ▸ 1.1 Moz/year LOM1 GRASBERG Only undeveloped asset in Indonesia this category in North America PUEBLO VIEJO2
Slide 8: Double the Grade of the Average Gold Deposit in the World
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 9: Reserve & Resource Growth
DONLIN GOLD: RESERVE & RESOURCE GROWTH OVER FIVE YEARS RESOURCES INCREASED 135% Expansion Potential 2006 2011 ~17 Moz 39 Moz Notes: Donlin Gold data as per NOVAGOLD public documents. Represents 100% of measured and indicated resources of which NOVAGOLD’s share represents 50%. Measured and indicated
Slide 10: 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 11: Strong Gold Fundamentals
DONLIN GOLD: STRONG GOLD FUNDAMENTALS SUPPLY AND DEMAND PRESSURES SUPPORT GOLD’S UPWARD TRAJECTORY New Discoveries Rare Gold Production Cliff Central Bank Buying Gold Exploration Spending vs. New Discoveries World Gold Production Central Bank Holdings Data through December 2014 Annual data through 2
Slide 12: 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 after-tax (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
Slide 13: Committed Partners Advancing the Project
DONLIN GOLD: COMMITTED PARTNERS ADVANCING THE PROJECT JOINT AND DEDICATED EFFORT TO COMPLETE THE EIS PROCESS BY BARRICK AND NOVAGOLD “...concurrent with ongoing permitting activities at Donlin Gold, we are working with our partners on a scenario that could significantly reduce the project's upfront
Slide 14: Leverage in a Place Where You Can Keep the Rewards
DONLIN GOLD: LEVERAGE IN A PLACE WHERE YOU CAN KEEP THE REWARDS LOCATION, LOCATION, LOCATION > Alaska’s jurisdictional appeal is comprised of five cornerstones: • Mineral potential • Established mining industry • Political and social stability • Excellent local partnerships • A full embrace of the r
Slide 15: 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 16: Life of Mine Agreements with Alaska Native Corporations
DONLIN GOLD: LIFE OF MINE AGREEMENTS WITH ALASKA NATIVE CORPORATIONS STRONG AND TIME-HONORED RELATIONSHIPS WITH STAKEHOLDERS Donlin Gold has the support of the land owners through a 20+ year relationship “Donlin Gold has taken great strides in planning a “We are pleased that the Donlin Gold EIS is m
Slide 17: Project Permitting Is on Track
DONLIN GOLD: PROJECT PERMITTING IS ON TRACK DRAFT ENVIRONMENTAL IMPACT STATEMENT RECENTLY PUBLISHED PERMITTING TIMELINE: August 2012 2017 Final EIS Permit Notice of Public Preliminary Draft EIS Draft EIS Public Record of Decision Applications Intent Scoping Comment Permit Issuance Period Submitted S
Slide 18: Keeping to Our Timetable
KEEPING TO OUR TIMETABLE: KEEPING OUR PROJECT PROGRESSING DEVELOPMENT TIMELINE OF NEW GOLD PROJECTS HAS MORE THAN DOUBLED 35 > Donlin Gold is more than halfway through permitting & will be ready for a construction decision when sentiment returns 30 ~18 years Average Number of Years from Discovery to
Slide 19: Disciplined & Transparent Environmental Impact Statement
DONLIN GOLD: DISCIPLINED & TRANSPARENT ENVIRONMENTAL IMPACT STATEMENT AGENCY COORDINATION AND PUBLIC INVOLVEMENT > US Army Corps of Engineers (“Corps”), is the lead agency for Environmental Impact Statement (EIS) > Coordinating with 11 cooperating agencies, working together at each stage of the NEPA
Slide 20: Expected to Provide Three Decades of Low Cost Production
DONLIN GOLD: EXPECTED TO PROVIDE THREE DECADES OF LOW COST PRODUCTION LOW OPERATING CASH COSTS AND ALL-IN SUSTAINING COSTS FIRST FIVE YEARS LIFE OF MINE Cash Costs1 Per Ounce Cash Costs1 Per Ounce Open-pit mining2 133 Open-pit mining2 270 Processing 208 Processing 257 G&A, royalties, land & other3 7
Slide 21: Galore Creek: A Significant Copper-Gold-Silver Asset in Canada
GALORE CREEK: A SIGNIFICANT COPPER-GOLD-SILVER ASSET IN CANADA THE KIND OF ASSET YOU CAN BUILD A COMPANY AROUND M&I RESOURCES1 copper 9 Blbs Grade: 0.50% gold 8 Moz Grade: 0.31 g/t silver 136 Moz Grade: 5.21 g/t Notes: 1) Represents 100% of measured and indicated resources of which NOVAGOLD’s share
Slide 22: Galore Creek: Peer Comparison
GALORE CREEK: PEER COMPARISON AMONG HIGHEST COPPER GRADE COMPARED TO NORTH AMERICAN ASSETS 0.60 > Advancing Galore Creek mine planning and project design 0.50 0.50 > Looking at opportunities to monetize the value of the asset 0.40 P&P + M&I grade (Cu%) 0.40 0.35 0.33 0.30 0.30 0.26 0.24 0.21 0.20 0.
Slide 23: Clear Focus and Strong Funding to Execute on All Fronts
CLEAR FOCUS AND STRONG FUNDING TO EXECUTE ON ALL FRONTS SUFFICIENT CASH ON HAND TO PROGRESS DONLIN GOLD THROUGH PERMITTING $127M in cash and term deposits1 2016 Budget Donlin Gold $9M Galore Creek $1M G&A, interest & Donlin Gold joint studies $15M TOTAL $25M 1) Includes $85 million in term deposits
Slide 24: Why Invest in NovaGold?
WHY INVEST IN NOVAGOLD? IT IS A BLUE CHIP INSTITUTIONAL QUALITY INVESTMENT “...a perpetual call on the gold price 26.5% Electrum Strategic with what could be a world-class Resources LP gold mining asset, but it won't get built until the gold price is right.” John Hathaway, 44% Tocqueville Asset Mana
Slide 25: Why NovaGold, Why Now
WHY NOVAGOLD WHY NOW Safe Geo-Political Environment: Strong Balance Sheet: Alaska and British Columbia, $127m cash + term deposits top-rated mining jurisdictions as of November 30, 2015 NOVAGOLD focused on execution and delivery of our business plan Top Tier Assets: Accomplished Leadership Team: Don
Slide 26: Appendix
APPENDIX novagold.com
Slide 27: Donlin Gold: Project Highlights
DONLIN GOLD: PROJECT HIGHLIGHTS DONLIN GOLD SLATED TO BE A STATE-OF-THE-ART SIGNIFICANT MINE Reserves: 33.9 Moz Au (505M tonnes ore)1 Resources: 5.1 Moz M&I (excluding P&P) and 6.0 Moz Inferred1 Mine Life: ~27 years Production: Year 1-5,1.5 Moz/year; LOM,1.1 Moz/year Operation: Open-pit, conventiona
Slide 28: Galore Creek: Project Highlights
GALORE CREEK: PROJECT HIGHLIGHTS GALORE CREEK TO BE ONE OF CANADA'S LARGEST COPPER MINES Reserves: 6.8 Blb Cu; 5.5 Moz Au; 102 Moz Ag1 Resources: 8.9 Blb Cu; 8.0 Moz Au; 136 Moz Ag (inclusive of reserves)1 Mine Life: ~18 years Production: Year 1-5, 400 Mlb/year Cu; LOM, 340 Mlb/year Cu Cash costs: L
Slide 29: Permitting in the U.S.
DONLIN GOLD: PERMITTING IN THE U.S. LARGE PROJECTS HAVE BEEN SUCCESSFULLY PERMITTED • Expansion Red Dog Alaska Lead/zinc ~2 years • EIS completed in 2009 • Development started on schedule in 2010 • Expansion – new heap leach facility Fort Knox Alaska Gold ~3 years • Permitting completed in 2007 • Ne
Slide 30: Capital Expenditures
DONLIN GOLD: CAPITAL EXPENDITURES WELL POSITIONED TO SHARE UPFRONT COSTS WITH THIRD PARTIES Areas US$M1 Opportunities1 Mining 345 Leasing equipment ~$170M of $345M Site preparation/roads 236 Process facilities 1,326 Oxygen plant could be built by third party ~$130M of $1,326M Tailings 120 Utilities
Slide 31: NovaGold: The Management Team
NOVAGOLD: THE MANAGEMENT TEAM INDUSTRY LEADERS TO BRING DONLIN GOLD THROUGH PERMITTING & BEYOND > Former President of Barrick Gold North America Gregory Lang > 35 years experience building & operating major open-pit and underground mines President & CEO (Goldstrike, Cortez, Turquoise Ridge, Bald Mou
Slide 32: NovaGold: The Board of Directors
NOVAGOLD: THE BOARD OF DIRECTORS > Chairman and CIO of The Electrum Group LLC, a privately held natural resources Dr. Thomas Kaplan investment management company that controls a diversified portfolio of precious and Chairman base metals assets > Former Chief Legal Officer and Corporate Secretary wit
Slide 33: NovaGold: Reserve/Resource Table
NOVAGOLD: RESERVE/RESOURCE TABLE Donlin Gold* Tonnage (100%) Grade (100%) Metal (100%) NOVAGOLD Share (50% ) GOLD Mt g/t Au koz Au koz Au Reserves1 Proven 7.7 2.32 573 286 Probable 497.1 2.08 33,276 16,638 P&P 504.8 2.09 33,849 16,924 Resources3, inclusive of Reserves Measured 7.7 2.52 626 313 Indic
Slide 34: NovaGold: Reserve/Resource Table (Con't)
NOVAGOLD: RESERVE/RESOURCE TABLE (CON’T) Notes: a. These reserve and resource estimates have been prepared in accordance with NI 43-101 and the CIM Definition Standard, unless otherwise noted. b. See numbered footnotes below on resource information. c. Rounding and significant figures may result in
Slide 35: 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]