Novagold Resources Inc. · AMEX:NG
Novagold Resources — Q3 2016 Earnings Presentation
24 slides from Novagold Resources's earnings presentation, Oct 5, 2016
Slide 1: 2016 Third Quarter & Project Update
2016 Third Quarter & Project Update NYSE-MKT, TSX: NG | October 5, 2016 novagold.com
Slide 2: Conference Call Attendees
CONFERENCE CALL ATTENDEES > Introduction Mélanie Hennessey (Vice President Corporate Communications) > Corporate Update Greg Lang (President & Chief Executive Officer) > Third Quarter Financials & 2016 Budget David Ottewell (Vice President & Chief Financial Officer) > Closing Remarks Greg Lang (Pres
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 Location: Southwest Alaska GALORE CREEK 50/50 with Teck Potential to be on
Slide 5: Project Permitting Is On Track
DONLIN GOLD: PROJECT PERMITTING IS ON TRACK DRAFT ENVIRONMENTAL IMPACT STATEMENT PUBLIC COMMENT PERIOD COMPLETE EIS TIMELINE: August 2012 2017 Permit Notice of Public Preliminary Draft EIS Draft EIS Public Final EIS Applications Intent Scoping Comment Record of Decision Period Submitted Submitted En
Slide 6: Third Quarter Activity Highlights - Donlin Gold
THIRD QUARTER ACTIVITY HIGHLIGHTS FOCUSED EXECUTION AND DELIVERY ON OUR BUSINESS PLAN DONLIN GOLD > Permitting update • The Corps continues to review the comment submittals received during the Donlin Gold public comment period for the draft EIS in preparation for completing the final EIS • Approxima
Slide 7: Third Quarter Activity Highlights - Galore Creek
THIRD QUARTER ACTIVITY HIGHLIGHTS FOCUSED EXECUTION AND DELIVERY ON OUR BUSINESS PLAN GALORE CREEK > Technical studies • Focused on completing targeted studies to optimize the project design • Final reports were completed on the first phase of the tunneling evaluation for access and material handlin
Slide 8: Q3-2016 Project Activity
Q3-2016 PROJECT ACTIVITY > Donlin Gold o Project funding (NG 50% share) • Q3: $2.5 million • YTD: $7.2 million • Full year: $9.0 million > Galore Creek o Project funding (NG 50% share) • Q3: $0.2 million • YTD: $0.7 million • Full year: $1.0 million 8
Slide 9: Q3-2016 Operating Performance Analysis
Q3-2016 OPERATING PERFORMANCE ANALYSIS Three months ended Nine months ended August 31, August 31, (US$ millions) 2016 2015 2016 2015 General and administrative(1) $4.2 $4.0 $16.1 $15.7 Donlin Gold 2.0 2.8 6.5 8.9 Galore Creek 0.2 (0.3) 0.7 0.1 Studies and evaluation — 0.1 — 0.4 Operating loss 6.4 6.
Slide 10: Q3-2016 Cash Flow Highlights
Q3-2016 CASH FLOW HIGHLIGHTS Three months ended Nine months ended August 31, August 31, (US$ millions) 2016 2015 2016 2015 General and administrative(1) $(2.4) $(2.1) $(7.7) $(8.0) Donlin Gold (2.5) (2.7) (7.2) (8.7) Galore Creek (0.2) (0.1) (0.7) (0.5) Studies and evaluation — (0.1) — (0.4) Working
Slide 11: Donlin Gold: A Large High-Grade Gold Project
DONLIN GOLD: A LARGE HIGH-GRADE GOLD PROJECT AMONG THE WORLD’S MOST SIGNIFICANT AND HIGHEST-GRADE GOLD DEPOSITS 1 1,2 Notes: 1) Shown on 100% project basis, of which NOVAGOLD holds a 50% interest 2) Measured and indicated resources inclusive of proven and probable reserves. See “Cautionary Note Conc
Slide 12: The Emerging Top-Tier Producer in the Safest Jurisdiction
DONLIN GOLD: THE EMERGING TOP-TIER PRODUCER IN THE SAFEST JURISDICTION A REMARKABLE RESOURCE AMONG NEW GOLD DEPOSITS IN THE AMERICAS 45.0 39.0 40.0 35.0 Donlin Gold’s size and projected production profile clearly 30.0 distinguish it from its peers (millions of ounces) M&I Gold Resource 25.0 20.0 15.
Slide 13: Double the Grade of the Average Gold Deposit in the World
DONLIN GOLD: DOUBLE THE GRADE OF THE AVERAGE GOLD DEPOSIT IN THE WORLD DONLIN GOLD’S HIGH GRADE ENDOWMENT PROVIDES RESILIENCE TO GOLD PRICE CYCLES Donlin Gold Average Grade2: World Average Grade1: 2.24 g/t 1.12 g/t Industry average grades are declining and sources for emerging production are increas
Slide 14: Excellent Exploration Potential
DONLIN GOLD: EXCELLENT EXPLORATION POTENTIAL MULTIPLE DRILL PROSPECTS AND TARGETS EXIST ALONG 8 KM TREND The next big gold discovery? > Potential to expand current open-pit resources along strike and at depth > Good prospects to discover meaningful deposits outside current mine footprint • Reserves
Slide 15: Significant Value Upside with Higher Gold Prices
DONLIN GOLD: SIGNIFICANT VALUE UPSIDE WITH HIGHER GOLD PRICES NPV INCREASES ~20X WITH ~2X INCREASE IN GOLD PRICE NPV after-tax (US$ in millions) 30,000 > Project has a positive return that increases substantially with higher gold prices 25,000 27year 27.0B mine life > Good payback at a broad range o
Slide 16: 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 > Donlin Gold LLC is the operating company > 50/50 owned by Barrick and NOVAGOLD > Focused on advancing Donlin Gold through permitting to a construction decision > Stu
Slide 17: Strong Partnerships with Local Stakeholders
DONLIN GOLD: STRONG PARTNERSHIPS WITH LOCAL STAKEHOLDERS ALASKA NATIVE CORPORATIONS: LEADERS OF REGIONAL ECONOMIC DEVELOPMENT “Donlin Gold’s continued presence in the region over the past two decades – and the partnership we’ve developed through the updated Surface Use Agreement – represent tremendo
Slide 18: Focused on Responsible Development and Facilitating a Collaborative Process
DONLIN GOLD: FOCUSED ON RESPONSIBLE DEVELOPMENT AND FACILITATING A COLLABORATIVE PROCESS A PROJECT WITH FAR-REACHING BENEFITS TO BOTH THE REGION AND THE STATE “I support the responsible development of this project and look forward to continuing a partnership with the USACE, the cooperating agencies,
Slide 19: Top Institutional Shareholders
TOP INSTITUTIONAL SHAREHOLDERS EXCELLENT SHAREHOLDER BASE APPRECIATES SUPERIOR LEVERAGE 26.5% “With so many macro- and Electrum Strategic micro-economic factors pointing Resources LP to a more robust price environment than we see today, investors in NOVAGOLD should 47.5% be well-positioned to derive
Slide 20: The NOVAGOLD Opportunity
THE NOVAGOLD OPPORTUNITY Safe Geo-Political Environment: Strong Balance Sheet: Alaska and British Columbia, $108M cash + term deposits top-rated mining jurisdictions as of August 31, 2016 Accomplished Leadership Team: focused on execution Top Tier Assets: 185 years cumulative experience and delivery
Slide 21: Appendix
APPENDIX novagold.com
Slide 22: 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 23: 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 24: 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 Senior Stakeholder Relations Specialist melanie.hennessey@