The Institutional-Quality Gold Development Company novagold.com NYSE-MKT, TSX: NG | February 2015 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 forwardlooking 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. 2 Roadshow Participants Dr. Thomas Kaplan ▸ Chairman and Chief Investment Officer of The Electrum Group LLC, a privately held natural resources investor that controls a diversified portfolio of precious and base metals assets ▸ ▸ ▸ Former President of Barrick Gold North America 35 years experience building & operating major mines Intimate knowledge of Donlin Gold ▸ President of The Electrum Group LLC, former VP of Homestake Mining and International Corona Corp. Over 30 years experience in the mining industry Chairman Gregory Lang President & CEO Igor Levental Board Member Mélanie Hennessey VP, Corporate Communications ▸ ▸ ▸ Held variety of executive and senior IR & corporate communications positions with Goldcorp, New Gold, and Hecla Mining Company Leading NOVAGOLD’s internal and external communications functions 3 Why Gold? Gold Has Been in a Secular Bull Market Since 2000 RISING TIDE We believe that gold is in a secular bull market, driven by financial and macroeconomic developments, a shift in central bank activity, and significant supply/demand pressures. “Experienced observers will note that sentiment is like the seasons, those espousing 'hunker down' in the gold industry will be clamoring for growth when the next leg in the bull market unfolds” 4 Why Gold? A Valuable Portfolio Diversifier “AFTER A 40-YEAR SECULAR TREND OF ATTEMPTED DE-MONETIZATION, GOLD IS RE-ASSERTING ITSELF AS THE ONLY FINANCIAL ASSET THAT DOESN’T REPRESENT SOMEONE ELSE’S LIABILITY” Gold provides excellent portfolio diversification due to its low correlation with most other asset classes, including equities, bonds, other commodities, and the U.S. dollar. Unlike other commodities, gold tends to retain value during recessions and deflationary periods. PORTFOLIO DIVERSIFICATION AND CAPITAL PRESERVATION Gold’s performance over the last decade vindicates its status as a valuable diversifier. Over the last decade, gold has surged relative to other investment classes; it has outperformed equities, risen in price as oil fell, and outperformed the Commodity Research Bureau (CRB) Futures Index by 25% between December 2009 and December 2014. We believe it will continue to do so because gold is more than a mere commodity. Gold Has Retained Value in Uncertain Times Gold Silver Comparative Returns Other Commodities Percent Change 120.0% 100.0% 100.0% 31-Dec-14 89.0% Gold 80.0% Silver 60.0% Oil 44.0% 40.0% 40.0% S&P 500 27.0% 1 year 5 year 10 year $1,184.10 -1.5% 8.0% 170.1% $15.60 -19.5% -7.4% 128.2% $53.27 -45.9% -33.3% 22.6% 2,058.90 11.4% 84.6% 69.9% 20.0% FTSE 6566.09 -2.7% 21.3% 36.4% 0.0% Nikkei 17450.77 7.1% 65.5% 51.9% 1709.67 5.0% 48.8% 46.2% $1.21 -12.0% -15.5% -10.7% 10.4% 29.2% 41.4% 27.3% 67.6% 95.8% (5.0%) (20.0%) $/Euro (40.0%) (60.0%) MSCI World Index (31.0%) (50.0%) (65.0%) (80.0%) 1814 to 1830 SOURCE: INCREMENTUM AG. 1864 to 1897 10 Year T-Note 30 Year T-Bond 1929 to 1933 SOURCE: CPM GROUP. Note: T-note, and T-bond are average rates of return. 5 Why Gold? Gold Is More Than a Commodity “OIL IS A COMMODITY. GOLD IS A CURRENCY.” 1 HISTORIC HAVEN Gold has served mankind for five millennia, protecting wealth from high inflation, negative real interest rates, volatile currencies, rising and falling empires, declining stock values, and other crises. We believe that this is because gold is more than a commodity; it is a currency. GOLD AND OIL Gold has risen in price as oil fell sharply in Q4 2008 and again in Q2 2011 and Q4 2014, signifying a historic decoupling. The plunge in oil prices since November 2014 has pushed the gold/oil ratio to the highest level since 1999. Gold & Oil: November 2014 – January 2015 Gold & Oil: 2007 - 2015 USD/oz. Gold Oil $/Barrel $2,100 $160 $1,900 $140 $1,700 USD/oz. Gold Oil $/Barrel $1,350 $85 $1,300 $80 $75 $120 $1,250 $1,300 $100 $1,200 $65 $1,100 $80 $1,150 $60 $60 $1,100 $500 $40 $1,050 $45 $300 $20 $1,000 $40 $1,500 $900 $700 SOURCE: BLOOMBERG 1. Thomas Kaplan, quote made on May 2014. $70 $55 $50 6 Why Gold? Safe Haven that has Retained Its Value “GOLD CAN FLOURISH IN INFLATION AND IT CAN FLOURISH IN DEFLATION.” HISTORICAL DEFLATIONARY PRECEDENT Gold has historically retained value on a relative and absolute basis. When imploding asset classes created a deflationary spiral in 2008 and 2009, oil, equities, currencies, agricultural and commodities declined. As a safe haven, gold retained its value, as investors sought to protect their savings and hedge against financial market default. In prior periods of significant economic downturn such as the Great Depression, average gold prices rose. Gold Prices vs. Change in CPI, September 2008 to March 2009 Monthly Data Gold price $/oz. Change in CPI $1,000 MoM CPI 1.0% Gold Price 0.5% $800 0.0% $600 (0.5%) $400 (1.0%) $200 (1.5%) $0 (2.0%) Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 SOURCE: CPM GROUP. Past performance is not indicative of future results. 7 Why Gold? It’s Scarce “GOLD IS A CURRENCY THAT SIMPLY CANNOT BE DEBASED...” 1 Major reserve currencies are being debased. After a 40-year secular trend of attempted de-monetization, gold has re-asserted itself as the only currency that cannot be debased or printed. Gold Vs. Yen June 2013 – January 2015 Gold Vs. Yen September 2014 – January 2015 155000 155000 150000 150000 CURRENCY DEBASEMENT 145000 145000 140000 135000 140000 130000 135000 125000 130000 120000 115000 6/3/2013 9/3/2013 12/3/2013 3/3/2014 6/3/2014 9/3/2014 12/3/2014 125000 9/1/14 10/1/14 11/1/14 12/1/14 1/1/15 SOURCE: BLOOMBERG “GOLD CANNOT BE PRINTED... AS WE KNOW, ITS DIFFICULT ENOUGH TO FIND AND MINE IT”1 • Gold production growth rates have slowed • New discoveries are increasingly difficult and SUPPLY CHALLENGES costly to find, highly risky, and require long lead times to reach production • Central banks, formerly a source of supply, have been net purchasers since 2009. Past performance is not indicative of future results 1. Thomas Kaplan, quotes made on May 2012. SOURCE: SNL METALS & MINING 8 8 Why Gold? Historically Gold and the USD are Known to Have Concurrently Outperformed “ALL PAPER CURRENCIES ARE TOILET TISSUE; THE DOLLAR ON OCCASION IS DOUBLE-PLY”1 “TO BE BULLISH ON GOLD, ONE DOES NOT NEED TO BE BEARISH ON THE DOLLAR.”1 BULLISH ON GOLD AND THE DOLLAR • While a weaker dollar encourages investors to store value in gold, a strengthening dollar can also be beneficial for the precious metal • Year-to-date, the gold price is up 9.1%, while the US dollar index is up 4.2%2 Chart source: CPM Group. Note: US dollar index data from 2014 to Jan 26, 2015. 1. Thomas Kaplan, quotes made on March 2013 and May 2012 respectively. 2. December 31, 2014 to January 27.2015. 9 Why Gold? It is Honest Money REPEAT AFTER ME: “WE WILL DEFEND THE 1.20 FLOOR WITH THE UTMOST DETERMINATION… WE WILL DEFEND THE 1.20 FLOOR WITH THE UTMOST DETERMINATION…” SNB PRESIDENT THOMAS JORDAN 2012 "LET ME IMMEDIATELY STATE HERE: THE SNB REMAINS COMMITTED TO PURCHASING UNLIMITED QUANTITIES OF FOREIGN CURRENCY TO ENFORCE THE MINIMUM EXCHANGE RATE WITH THE UTMOST DETERMINATION.” SNB PRESIDENT THOMAS JORDAN 12/18/14 CHF USD $1.35 Close $1.30 $1.25 $1.20 $1.15 $1.10 $1.05 $1.00 $0.95 1/1/2015 1/4/2015 1/7/2015 1/10/2015 1/13/2015 1/16/2015 1/19/2015 1/22/2015 1/25/2015 “NO EX-ANTE QUANTITATIVE LIMITS ARE SET ON THE SIZE OF OUTRIGHT MONETARY TRANSACTIONS…” “THE CENTRAL BANK WILL DO “WHATEVER IT TAKES” TO SAVE THE EURO ” PRESIDENT OF THE EUROPEAN CENTRAL BANK, MARIO DRAGHI Gold ECB Balance Sheet Gold vs. Euro 3100 1200 2600 1150 1100 2100 1050 1600 1000 950 1100 900 600 100 Jan-10 850 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 800 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 THE ECB’S BALANCE SHEET HAS CORRELATED REMARKABLY WELL WITH USD GOLD PRICES SINCE THE EURO’S INCEPTION; IF THAT RELATIONSHIP HOLDS, €1.1T ECB QE COULD EQUATE TO $2,000 GOLD BY SEP-16E. 10 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 copper mine in Canada 11 Donlin Gold: A Large High-Grade Gold Project AMONG THE WORLD’S MOST SIGNIFICANT AND HIGHEST-GRADE GOLD DEPOSITS RESERVES1 34 million oz Proven & Probable Grade: 2.1 g/t RESOURCES1,2 39 million oz Measured & Indicated Grade: 2.2 g/t (inclusive of P&P reserves) 6 million oz Inferred Grade: 2.0 g/t 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. 12 Donlin Gold: The Right Project ARGUABLY THE MOST IMPORTANT GOLD PROJECT IN THE WORLD TODAY size partnerships grade DONLIN GOLD jurisdiction growth longevity leverage to gold 13 Donlin Gold: The Emerging Top-Tier Producer in the Safest Jurisdiction A REMARKABLE RESOURCE AMONG EMERGING OPEN-PIT GOLD DEPOSITS ▸ 40.0 Donlin Gold’s size and North American location distinguish it from its peers M&I Gold Resource (millions of ounces) 35.0 30.0 25.0 39.0 20.0 15.0 19.0 10.0 15.7 6.2 5.0 4.2 4.0 0.0 Projected Annual Gold Production (millions of ounces) Donlin Gold Livengood Rainy River Merian 0.40 0.33 Haile 1.60 1.40 1.501 1.20 1.00 0.80 0.60 1.102 0.76 0.40 0.58 0.20 0.13 0.00 Donlin Gold Location Owner(s) Notes: Metates USA NOVAGOLD (50%) Barrick (50%) Metates Mexico Chesapeake (100%) Livengood Merian Rainy River Haile USA Suriname Canada USA ITH Mines (100%) Newmont (75%) Republic of Suriname (25%) New Gold (100%) Romarco (100%) • Peer group data as per latest company documents, public filings and websites. Comparison group based on large, gold-focused development projects where the majority of the M&I resource is openpit. Newmont reports "Mineralized Material" as defined by SEC Industry Guide 7 for its Merian gold project as oppose to an "M&I Gold Resource" as defined by NI 43-101. • 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. 14 Mines the Size of Donlin Gold are Scarce ONLY THREE PROJECTS IN THE WORLD ARE SLATED TO PRODUCE >1MOZ/YEAR 1 123 MINES >100 Koz 13 MINES >500 Koz 3 MINES >800 Koz GRASBERG Indonesia PUEBLO VIEJO Dominican Republic 3 MINES/ Projects >1 Moz DONLIN GOLD Only undeveloped asset in this category in North America USA ▸ 1.5 Moz/year in first five full years1 ▸ 1.1 Moz/year LOM1 Notes: Donlin Gold projected annual production represents 100% of which NOVAGOLD’s share is 50%. All other production estimates, with the exception of Grasberg, are based on published 2014 average gold annual production guidance sourced from SNL Metals & Mining. Grasberg represents the published 2014 gold sales guidance. Excludes Newmont’s Nevada operations that consist of multiple mines. Analysis includes life of mine data for Donlin Gold. 1) If put into production as contemplated by the second updated feasibility study effective November 18, 2011, as amended January 20, 2012. 15 Donlin Gold: The Right Project HIGH-GRADE OPEN-PIT MINE size partnerships grade DONLIN GOLD jurisdiction growth longevity leverage to gold 16 Donlin Gold: Is More than Double the Grade of the Average Gold Deposit in the World VERY FEW LARGE HIGH-GRADE OPEN-PIT GOLD PROJECTS ON THE HORIZON Donlin Gold World Avg. Grade2: Avg. Grade1: 2.2 g/t 1.01 g/t Reserve grades continue to decline while sources for emerging production to replace mined-out capacity have become increasingly scarce 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 million ounces 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. 17 Donlin Gold: The Highest-Quality Open-Pit Development-Stage Gold Deposit GRADE COMPARES WELL AMONG PEER GROUP OF EMERGING OPEN-PIT GOLD DEPOSITS ▸ M&I Gold Grade (g/t) 2.50 2.00 1.50 With a high grade endowment, Donlin Gold is a unique project better able to weather gold price cycles 2.24 1.77 1.00 1.22 1.09 0.61 0.50 0.50 0.00 Donlin Gold Haile Merian Rainy River Livengood Metates M&I Gold Grade (g/t) 3.00 2.50 2.00 2.66 1.50 2.24 2.14 1.88 1.81 1.00 1.44 1.32 1.04 0.98 0.50 0.81 0.78 Yamana Newmont 0.00 Agnico Eagle Donlin Gold Polyus Gold Fields AngloGold Ashanti Barrick Harmony Eldorado Goldcorp Notes: • Development-stage peer group data as per latest company documents, public filings and websites. Comparison group based on large, gold-focused development projects where the majority of the M&I resource is open-pit. Top gold producers group data based on 2013 annual average grade per tonne (combined proven & probable reserves and measured & indicated resources) for open-pit and underground material as per public filings. • 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. • Newmont reports "Mineralized Material" as defined by SEC Industry Guide 7 for its Merian gold project as oppose to an "M&I Gold Resource" as defined by NI 43-101. 18 Donlin Gold: The Right Project SUBSTANTIAL EXPLORATION POTENTIAL size partnerships grade DONLIN GOLD jurisdiction growth longevity leverage to gold 19 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 and resources are contained within just 3 km of an 8 km long trend ▶ Inferred mineral resource: 6 million ounces of gold mainly inside the reserve pit • Upside potential to project economics 20 Donlin Gold: Reserve & Resource Growth OVER FIVE YEARS RESOURCES INCREASED 135% Expanding Potential 2006 2011 ~17Moz 39Moz 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 resources are inclusive of proven and probable reserves. See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource Base” with footnotes in the appendix. 21 Donlin Gold: The Right Project 27-YEAR MINE LIFE; STRONG LEVERAGE TO GOLD PRICE size partnerships grade DONLIN GOLD jurisdiction growth longevity leverage to gold 22 Donlin Gold: Has Exceptional Leverage to Gold NPV INCREASES ~20X WITH ~2X INCREASE IN GOLD PRICE ▶ Project has a positive return that increases substantially with higher 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 27.0B 27year 25,000 mine life NPV (US$ in millions) ▶ Good payback at a broad range of gold prices 30,000 19.2B 20,000 14.6B 15,000 11.6B 10,000 8.2B 6.2B 5,000 0 $1,200 $1,300 $1,500 $1,700 $2,000 $2,500 Gold Price (US$) NPV at 5% NPV at 0% 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 @ $2,500 gold. Project development costs prior to 1/1/2014 are treated as sunk costs. 23 Keeping to our Timetable: Project Progressing as Forecasted DEVELOPMENT TIMELINE OF NEW GOLD PROJECTS HAS MORE THAN DOUBLED 35 ▸ Exciting that Donlin Gold is more than halfway through permitting & will be shovel-ready when sentiment returns ~18 years discovery to production 111 mines 25 ~11 years discovery to production ~8 years 20 discovery to production 57 mines 27 mines 15 10 5 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 0 1985 Average Number of Years from Discovery to Production 30 Startup Year Notes: Data sourced from SNL Metals & Mining. 1) Based on announced mining startup dates. Expansions and mine redevelopments are not included as they are not comparable with new mine developments. 24 Why Donlin Gold? No New and Substantial Discoveries DESPITE RECORD HIGH EXPLORATION SPENDING LEVELS THE GOLD INDUSTRY HAS EXPERIENCED A RECENT DROP IN DISCOVERIES 16 10,000 Gold Discovered Exploration Budget (US$M) 9,000 14 Number of Gold Discoveries 8,000 12 7,000 10 6,000 8 5,000 4,000 6 3,000 2012 highest year on record for exploration spending and first year in over two decades with no discoveries 4 2,000 2 1,000 0 0 1997 1999 2001 2003 2005 2007 2009 2011 2013 Notes: Data as per SNL MEG’s MineSearch database, Company reports, SNL MEG estimates. Thomson Reuters. A gold discovery of 5 million ounces or more is considered significant. Number of discoveries data not yet available for 2014. 25 Donlin Gold: The Right Project LOCATED IN ALASKA, ONE OF THE TRULY SAFE MINING JURISDICTIONS size partnerships grade DONLIN GOLD jurisdiction growth longevity leverage to gold 26 Donlin Gold: Located in a Favorable Jurisdiction ALASKA – A RESOURCE-RICH STATE WITH AN ESTABLISHED RULE OF LAW Donlin Gold located in Alaska, one of the safest jurisdictions in the world with a history of successful mine development ▶ Alaska is the second largest U.S. gold-producing State ▶ Well-defined permitting process ▶ Natural resource projects integral to the State’s economy ▶ Strong and time-tested community support 27 Donlin Gold: The Right Project STRONG PARTNERSHIPS size partnerships grade DONLIN GOLD jurisdiction growth longevity leverage to gold 28 Donlin Gold: Partnerships & Activities COLLABORATING WITH OUR PARTNER TO MAXIMIZE PROJECT RETURN Barrick and NOVAGOLD are jointly committed to working together to create shareholder value from Donlin Gold’s unique optionality ▶ Project activities continue to progress as planned ▶ After further de-risking, we are encouraged by Donlin Gold’s prospects ▶ Focused on advancing Donlin Gold through permitting to a record of decision ▶ Working together on evaluating development alternatives ▶ Neither partner has a build at any gold price mentality “Both companies are happy to take a sober and constructive view. We don't want to subsidize the world's consumption of gold by squandering the treasures that Mother Nature has given us and we're happy to wait for the higher gold prices that will make the project's economics sing.” – Thomas S. Kaplan, Chairman of NOVAGOLD RETAINING THE GREATEST VALUE WHILE ENSURING CAPITAL EFFICIENCY 29 Donlin Gold: Mining with the Local Communities ALASKA NATIVE CORPORATIONS: LEADERS OF REGIONAL ECONOMIC DEVELOPMENT ▶ ANCSA established 40 years ago; resolved legal issues related to Native land claims ▶ Lands valuable for resource potential selected by Regional Corporations under ANCSA ▶ Native corporations have an owner’s interest in the development of the selected lands to support the economic prosperity of their shareholders ▶ Mining is compatible and consistent with subsistence lifestyles ▶ Donlin Gold is located on private land specifically selected for its resource development potential 30 Donlin Gold: Durable, Long-Term Agreements with the Native Corporations STRONG AND TIME-HONORED RELATIONSHIPS WITH STAKEHOLDERS “Calista and TKC are not only stakeholders, but are the legislatively mandated landowners charged with the responsibility of seeing the project to fruition in an environmentally responsible manner.” – June MacAtee, Vice President of Calista Corporation (mineral owner) "Since 1995, Donlin Gold has worked constructively in our region and I know our partnership will benefit our shareholders for many generations. Today's agreement sets the basis for a long and productive relationship that with construction of the mine will provide jobs and financial value to the shareholders in our 10 villages.” – Maver Carey, President & CEO of The Kuskokwim Corporation (surface owner) Donlin Gold has the support of the land owners through a 20+ year relationship 31 Donlin Gold: A Unique Partnership with the National Fish and Wildlife Foundation (NFWF) PROTECT, RESTORE AND CONSERVE ALASKA FISH AND WILDLIFE “We, the Board members of NOVAGOLD, are truly proud of the fact that our company and NFWF have come together to create an extraordinary partnership that can serve as a model for the sustainable development of natural resources.” “The lands and waters of Alaska provide a home for an incredible number of fish and wildlife species. We applaud this commitment from NOVAGOLD and Donlin Gold as a significant contribution toward conserving the wetlands, streams and wild places of Alaska for future generations.” Thomas Kaplan, Chairman Jeff Trandahl, Executive Director & CEO The partnership supports regional solutions driven by locals to: ▶ Promote healthy watersheds ▶ Enhance and protect wildlife habitat ▶ Advance sustainable fisheries 32 Donlin Gold: The Project Permitting is On Track DEVELOPMENT TIMELINE - ADVANCING TOWARD A CONSTRUCTION DECISION ̴4 ̴4 27+ years first five full years1 OPERATION ENGINEERING & CONSTRUCTION 1.5Moz/year PERMITTING EXPLORATION & ENVIRONMENTAL STUDIES 16 years 1.1Moz/year life of mine1 WE ARE HERE HALF WAY THROUGH PERMITTING Federal and State agencies are working cooperatively, with day-to-day support from Donlin Gold, to efficiently move the project through the EIS and permitting processes. Major permit applications are well underway • • • • • Air quality Water discharge and usage* Pipeline plan of development* Wetlands* Dam safety* * applications submitted and in agency review 33 Notes: 1) Donlin Gold data as per the second updated feasibility study. Projected average annual production represents 100% of which NOVAGOLD’s share represents 50%. Donlin Gold: Permitting Milestones PAST THE HALFWAY MARK IN THE EIS PROCESS 2012-2013 Notice of Intent to Prepare EIS 2013-2015 2015-2016 Draft EIS Final EIS Record of Decision Initial permit applications Scoping summary document Submitted: 08/12 Completed: 08/13 Notice of intent Development of alternatives Issued: 12/14/12 Completed: Q2/14 Publish final EIS Public scoping period Initial drafts of EIS chapters Record of decision Ended: 03/29/13 Completed: Q4/14 Prepare draft final EIS Agency review Agency & Donlin Gold review Completed: Q4/14 Prepare draft EIS Public comment period 34 Donlin Gold: Optimization Studies COLLABORATING WITH OUR PARTNER TO MAXIMIZE PROJECT RETURN ▶ Optimization studies underway to evaluate opportunities to reduce initial owner capital • Third-party financing or owner/operator prospects (≈$1.0B potential reductions i.e. gas pipeline, port facilities, oxygen plant, mining fleet) • Conducting technical studies ($3.0M) with experts from both companies and independent consultants to identify potential design and execution enhancements from FSU2 Potential benefits: ▶ Lower initial owner capital required to build ▶ Opportunity to implement lessons learned from past/current experience in building and operating assets such as Pueblo Viejo ▶ Opportunity to expand with future cash-flow generation ▶ When sentiment returns in the gold sector, the market will seek out projects with leverage and growth • Donlin Gold will be one of the few projects shovel-ready 35 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 billion lbs Grade: 0.5% gold 8 million oz Grade: 0.3 g/t silver 136 million oz Grade: 5.2 g/t Notes: 1) Represents 100% of measured and indicated resources of which NOVAGOLD’s share is 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. 36 Galore Creek: Peer Comparison AMONG HIGHEST COPPER GRADE COMPARED TO NORTH AMERICAN ASSETS P&P + M&I grade (Cu%) 37 Notes: Data as per SNL MEG’s MineSearch database, Company reports, SNL MEG estimates. Clear Focus and Strong Funding to Execute on all Fronts 2014 TOTAL SPEND 14% LESS THAN BUDGET 2014 Total spending Cash and term deposits1 millions $26 $165 2015 Budget2 Donlin Gold Galore Creek $2 G&A, interest & Donlin Gold joint studies $14 Repayment of outstanding convertible notes3 $16 Anticipated year-end cash position 1) 2) 3) $13 Includes US$ 95.0 million in term deposits as of November 30, 2014. 2015 anticipated budget expenditure disclosed on January 28, 2015 The Notes mature on May 1, 2015. $120 38 2015 Outlook CONTINUE TO EXECUTE AND DELIVER ON OUR BUSINESS PLAN PRIORITY PRIORITY PRIORITY PRIORITY PRIORITY 1 2 3 4 5 Advance Donlin Gold permitting to a construction decision Maintain strong relationships with all stakeholders Advance Galore Creek mine planning and project design Evaluate opportunities to monetize the value of Galore Creek Safeguard our cash position COMMITTED TO GOLD THROUGH VARIOUS MARKET CYCLES 39 Why Invest in NOVAGOLD? A BLUE CHIP INSTITUTIONAL QUALITY INVESTMENT 26.7% Cash and Term Deposits2 Electrum Strategic Resources LP $165.3M 47% Convertible Notes3 Other 11.3% $15.8M Paulson & Co. Inc 6.9% 3.0% Tocqueville Asset Management 5.2% The Baupost Group, L.L.C. % 53 Held by top 5 shareholders1 Market Cap4 $1.17B 1) 2) Van Eck Associates Corporation 3) 4) NYSE-MKT, TSX: NG Shareholder positions are based on the latest 13-F filings Includes US$ 95.0 million in term deposits as of November 30, 2014. The Notes mature on May 1, 2015. Market Capitalization as of January 26, 2015 based on 317.8 million shares issued and outstanding and NG share price of $3.69. 40 NOVAGOLD Highlights Safe Geo-Political Environment: Alaska and British Columbia, top-rated mining jurisdictions Strong Balance Sheet: $165m cash + term deposits as of November 30, 2014 NOVAGOLD focused on execution and delivery of our business plan Accomplished Team: 185 years cumulative experience Prolific Production Profile: Donlin Gold expected to be one of industry’s top producing assets; strong leverage to gold Top Tier Assets: Large, high-grade deposit past 50% mark in permitting; great additional exploration potential Supportive Stakeholders: Long standing shareholders and engaged partners 41 appendix novagold.com Donlin Gold: A Project Overview ADVANCING DONLIN GOLD UP THE VALUE CHAIN ▶ Donlin Gold LLC is the operating company ▶ 50/50 ownership by NOVAGOLD and Barrick Gold ▶ Board of Directors has two representatives from each company • Chairman rotates every year • Each company has the right to appoint the Donlin Gold General Manager every two years ▶ Operates under agreements with Alaska Native Claims Settlement Act (ANCSA) landowners • Calista Corporation (Subsurface minerals and surface lease) • The Kuskokwim Corporation (Surface use agreement) ▶ Project office in Anchorage • 36 full-time employees and 2 contractors ▶ Strong track record for local hiring 43 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, conventional truck & shovel Milling: 53.5k tonnes/day, sulfide flotation, pressure oxidation (POX), carbon-in-leach recovery (CIL) Strip ratio: 5.5 = 2.8B tonnes waste rock Tailings: Fully lined storage facility Power: 153MW average site-generated load, fueled by natural gas transported via a 315-mile pipeline Logistics: All consumables supplied by Kuskokwim River transportation system with port near Jungjuk Creek See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve and Resource Base” table with footnotes. 44 Donlin Gold: Expected to Provide Three Decades of Low Cost Production LOW OPERATING CASH COSTS AND ALL-IN SUSTAINING COSTS First Five Years Cash Costs1 Per Ounce Open-pit mining2 Processing G&A, royalties, land & other3 Total All-in Sustaining Costs Per Ounce Cash costs1 Sustaining capex Corporate administration Reclamation Total Life of Mine 133 208 70 $411 411 83 21 17 $532 Cash Costs1 Per Ounce Open-pit mining2 Processing G&A, royalties, land & other3 Total 270 257 108 $635 All-in Sustaining Costs Per Ounce Cash costs1 Sustaining capex Corporate administration Reclamation Total 635 50 28 22 $735 Notes: Donlin Gold estimates as per the second updated feasibility study effective November 18, 2011, as amended January 20, 2012. US GAAP cost of sales, excluding depreciation and reclamation 1) Net of deferred costs 2) Based on US$1,200/oz gold price 45 Donlin Gold: Capital Expenditures WELL POSITIONED TO SHARE UPFRONT COSTS WITH THIRD PARTIES Areas US$M1 Mining 345 Site preparation/roads 236 Process facilities 1,326 Tailings 120 Utilities 1,302 Ancillary buildings 304 Off-site facilities 243 Total Direct Costs 414 Indirect Costs 1,405 984 Total Owner’s & Indirect Costs, and Contingency 2,803 Total Project Cost 6,679 1) Represents 100% of project’s capital expenditures Leasing equipment ~$170M Oxygen plant could be built by third party ~$130M Gas pipeline could be built by third party $834M 3,876 Owners’ cost Contingency Opportunities1 Healthy Contingency >$1B potential initial capital reductions 46 Donlin Gold: Key Performance Indicators ROBUST ECONOMICS HIGHLY LEVERAGED TO GOLD PRICES All amounts in US dollars Gold Price Unit $1,000/oz $1,200/oz Base Case $1,700/oz $2,000/oz $2,500/oz Average annual after-tax cash flow (first full five years) $M 670 950 1,500 1,785 2,185 Average annual after-tax cash flow (LOM) $M 350 500 815 990 1,275 NPV (5%) after-tax1 $M (1,340) 550 4,580 6,720 10,240 NPV (0%) after-tax1 $M 2,100 6,200 14,620 19,250 26,975 IRR after-tax1 % 2.3 6.0 12.3 15.1 19.1 Years 19.1 9.2 5.3 4.4 3.5 Payback period 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. Project development costs prior to that date are treated as sunk costs. 1) NPVs and IRRs as at January 1, 2014. Project development costs prior to that date are treated as sunk costs. 47 Donlin Gold: Permitting in the U.S. LARGE PROJECTS HAVE BEEN SUCCESSFULLY PERMITTED Project Name Location Metal Time Description Red Dog Alaska Lead/zinc ~2 years • • • Expansion EIS completed in 2009 Development started on schedule in 2010 Fort Knox Alaska Gold ~3 years • • Expansion – new heap leach facility Permitting completed in 2007 Pogo Alaska Gold ~3 years • • • New mine Permitting completed in 2004 Operations began in 2006 Arturo Nevada Gold ~4 years • • • Major pit expansion New waste rock and heap leach facilities EIS/ROD completed in May 2014 Rochester Nevada Silver ~1 year • • Expansion – new heap leach & mine reopening EA/permitting completed in 2011 Cortez Nevada Gold ~3 years • • Major pit expansion EIS/permitting completed in 2008/2009 Goldstrike Nevada Gold ~2 years • • • Major pit expansion Waste rock and tailings facilities ROD approving the project was in 2009 Hycroft Nevada Gold ~2 years • • Reactivation EIS/permitting completed in 2012 Long Canyon Nevada Gold ~3 years (anticipated) • • New pit, heap leach, mill and tailings facility Final EIS approved by BLM, under 30-day review Pan Nevada Gold ~2 years • • New open pit and heap leach EIS/permitting completed in 2013 Minnesota Copper/nickel/cobalt ~12 years (anticipated) • • New open pit Final EIS and Record of Decision anticipated in the first half 2015 South Carolina Gold ~4 years (anticipated) • • • New mine on historic property Open pits, processing and tailings facilities Final EIS issued July 2014, ROD issued October 2014 NorthMet Haile 48 Galore Creek: Project Overview GALORE CREEK, AN EXCEPTIONAL ASSET ▶ Galore Creek Mining Corporation (GCMC) is the operating company ▸ 50/50 ownership by NOVAGOLD and Teck Resources Inc. ▸ Management Committee has two representatives from each company • Chairman rotates every year ▸ Project is located within the Tahltan Nation Territory and operates under a Participation Agreement ▸ All mineral claims are on Crown land ▸ Project office in Vancouver • ▸ Abundance of technical strength to draw from within Teck Strong track record for Tahltan hiring at project site as well as contracting and procurement with Tahltan businesses and joint ventures 49 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 Ag 1 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 Operation: Open-pit, conventional truck & shovel Milling: +80k tonnes/day, conventional crush, grind, and Cu/Au/Ag flotation concentration, plant located in West More Valley Strip ratio: 2.2 = 1.1B tonnes waste rock Tailings: storage facility located in West More Valley next to plant Power: BC Hydro’s Northwest Transmission Line is now in service connecting from near Terrace, BC to Bob Quinn to promote remote industrial development, Galore Creek to tie into the NTL Logistics: Port facilities to be built near Stewart, BC Notes: See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve and Resource Base” table with footnotes. 50 Galore Creek: Key Performance Indicators ROBUST ECONOMICS HIGHLY LEVERAGED TO METAL PRICES All amounts in CAD dollars Unit Copper Gold Silver LOM after-tax cash flow US$/lb US$/oz US$/oz $M Metal Prices 2.00 900 15.00 1,514 2.65 1,100 18.50 5,118 3.00 1,100 20.00 6,641 3.50 1,200 25.00 9,223 4.00 1,300 30.00 11,812 NPV (5%) after-tax1 $M (969) 988 1,794 3,134 4,458 NPV (7%) after-tax1 $M (1,431) 137 778 1,837 2,877 IRR after-tax1 % 2.4 7.4 9.2 11.9 14.3 Years 13.2 7.8 6.1 4.1 3.3 Payback period Notes: Galore Creek estimates as per the 2011 Pre-Feasibility Study. All dollar figures are in CAD. See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource Base” with footnotes in the appendix. 1) NPVs and IRRs as of two years prior to significant project spend. Project development costs prior to that point are treated as sunk costs. 51 NOVAGOLD: The Team INDUSTRY LEADERS TO BRING DONLIN GOLD THROUGH PERMITTING & BEYOND MANAGEMENT Gregory Lang President & CEO David Deisley Executive Vice President and General Counsel David Ottewell Vice President and Chief Financial Officer Mélanie Hennessey Vice President, Corporate Communications Ron Rimelman Vice President, Environment, Health, Safety & Sustainability Richard Williams Vice President, Engineering and Development ▸ ▸ ▸ Former President of Barrick Gold North America 35 years experience building & operating major mines Intimate knowledge of Donlin Gold ▸ ▸ ▸ Former EVP and General Counsel of Goldcorp Regional General Counsel for Barrick Gold North America Extensive track record in project permitting, corporate social responsibility, mergers and acquisitions and corporate development 25 years of mining industry experience ▸ ▸ ▸ ▸ Former VP and Corporate Controller of Newmont Mining Corporation 25 years of mining industry experience Diverse experience in all facets of financial management, from mine operations to executive corporate financial management of premier gold producers ▸ Held variety of executive and senior IR & corporate communications positions with Goldcorp, New Gold, and Hecla Mining Company Leading NOVAGOLD’s internal and external communications functions ▸ ▸ ▸ 25+ years of environmental experience, managing environmental impact assessments and permitting activities world-wide Leadership role on mine permitting and NEPA evaluations for mine projects in Alaska since 1993 ▸ ▸ ▸ Former Project Director for the Pueblo Viejo project in the Dominican Republic 30 years of experience developing and operating major mines world-wide Particular expertise in autoclave technology 52 NOVAGOLD: The Board of Directors Dr. Thomas Kaplan Chairman Chairman and CIO of The Electrum Group LLC, a privately held natural resources investor that controls a diversified portfolio of precious and base metals assets Sharon Dowdall Former Chief Legal Officer and Corporate Secretary with Franco-Nevada, transforming an industry pioneer into one of the most successful precious metals enterprises in the world Dr. Marc Faber A well-known commentator and author on global investing, publisher of The Gloom, Boom & Doom Report Greg Lang President & CEO Former President of Barrick Gold North America, 35 years experience building & operating major mines with intimate knowledge of Donlin Gold Gil Leathley COO and Director of Sunward Resources, former Senior Vice President and Chief Operating Officer of the Company Igor Levental President of The Electrum Group LLC, former VP of Homestake Mining and International Corona Corp. Kalidas Madhavpeddi Chief Executive Officer of China Moly Corp. Former Executive with Phelps Dodge. Gerald McConnell Former Chairman and CEO of NOVAGOLD, CEO of Namibia Rare Earths Inc. Clynton Nauman CEO of Alexco Resources, formerly with Viceroy Gold and Kennecott Minerals Rick Van Nieuwenhuyse CEO of NovaCopper, founder and former CEO of NOVAGOLD Anthony Walsh Former President and Chief Executive Officer of Miramar Mining Corporation, which in 2007 was sold to Newmont Mining Corporation. 53 NOVAGOLD: Reserve/Resource Table At April 30, 2012 Donlin Gold (NOVAGOLD 50%) GOLD Reserves (100%)1 Proven Probable P&P Resources (100%)3 inclusive of reserves Measured Indicated M&I Inferred Tonnage Mt Grade* g/t Metal content Moz NOVAGOLD share** Moz 7.7 2.32 0.57 0.29 497.1 504.8 2.08 2.09 33.28 33.85 16.64 16.93 7.7 533.6 541.3 92.2 2.52 2.24 2.24 2.02 0.63 38.38 39.01 5.99 0.31 19.19 19.50 3.00 Tonnage Mt Grade* %Cu Metal content Mlbs NOVAGOLD share** Mlbs Galore Creek (NOVAGOLD 50%) COPPER Reserves (100%)2 Proven Probable P&P Resources (100%)4 inclusive of reserves Measured Indicated M&I Inferred GOLD Reserves (100%)2 Proven Probable P&P Resources (100%)4 inclusive of reserves Measured Indicated M&I Inferred SILVER Reserves (100%)2 Proven Probable P&P Resources (100%)4 inclusive of reserves Measured Indicated M&I Inferred 69.0 0.61 900.0 450.0 459.1 528.0 0.58 0.59 5,900.0 6,800.0 2,950.0 3,400.0 108.4 706.3 814.7 346.6 0.48 0.50 0.50 0.42 1,147.0 7,786.0 8,933.0 3,230.0 573.5 3,893.0 4,466.5 1,615.0 Mt g/t Moz Moz 69.0 0.52 1.15 0.58 459.1 528.0 0.29 0.32 4.30 5.45 2.15 2.73 108.4 706.3 814.7 346.6 0.48 0.28 0.31 0.24 1.70 6.40 8.00 2.70 0.85 3.20 4.00 1.35 Mt g/t Moz Moz 69.0 4.94 11.0 5.5 459.1 528.0 6.18 6.02 91.2 102.2 45.6 51.1 108.4 706.3 814.7 346.6 4.10 5.38 5.21 4.28 14.30 122.10 136.40 47.73 7.15 61.05 68.20 23.87 54 NOVAGOLD: Reserve/Resource Table (con’t) Copper Canyon (NOVAGOLD 70%) Resources (100%)5,6 COPPER Inferred GOLD Inferred SILVER Inferred t = metric tonne M = million g/t = grams/tonne * Reserve grade is diluted; resource grade is in situ. ** NOVAGOLD share net after earn-ins Tonnage Grade* Metal content NOVAGOLD share** Mt %Cu Mlbs Mlbs 53.7 0.50 592.0 414.4 Moz Mt g/t Moz 53.7 0.73 1.26 0.88 Mt g/t Moz Moz 53.7 10.60 18.36 12.85 Approximate cut-off grades (see Resource Footnotes below): 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 Copper Canyon Resources5,6: 0.6% copper equivalent 55 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 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: 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. 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$16.85/oz, respectively. Appropriate mining costs, processing costs, metal recoveries and inter ramp pit slope angles varing from 42º to 55º were used to generate the pit phase designs. Mineral Reserves have been calculated using a 'cashflow grade' ($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. 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". 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". The copper-equivalent grade was calculated as follows: CuEq = Recoverable Revenue ÷ 2204.62 * 100 ÷ 1.55. Where: CuEq = Copper equivalent grade; Recoverable Revenue = Revenue in US dollars for recoverable copper, recoverable gold and recoverable silver using metal prices of US$1.55/lb, US$650/oz, and US$11/oz for copper, gold, and silver, respectively; for the purposes of the equivalency formula, Cu Recovery is assumed to be 100%. 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". NOVAGOLD Canada Inc. has agreed to transfer its 60% joint venture interest in the Copper Canyon property to the Galore Creek Partnership, which is equally owned by NOVAGOLD Canada Inc. and a subsidiary of Teck Resources Limited. The remaining 40% joint venture interest in the Copper Canyon property is owned by another wholly owned subsidiary of NOVAGOLD. 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 Donlin Gold Galore Creek Qualified Person(s) Most Recent Disclosure & Filing Date Tony Lipiec, P. Eng., AMEC Donlin Creek Gold Project Gordon Seibel R.M. SME, AMEC Alaska, USA Kirk Hanson P.E., AMEC NI 43-101 Technical Report on Second Updated Feasibility Study amended filing on January 23, 2012 Robert Gill, P.Eng., AMEC Galore Creek Copper–Gold Project, Jay Melnyk, P.Eng., AMEC British Columbia, NI 43-101 Technical Report on Pre-Feasibility Study, Greg Kulla, P.Geo., AMEC filed on September 12, 2011 Greg Wortman, P.Eng., AMEC Dana Rogers, P.Eng., Lemley International 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 section related to: (i) Donlin Gold since the issuance of the technical report filed on January 23, 2012, and (ii) Galore Creek since the issuance of the technical report filed on September 12, 2011. 56 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 VP, Corporate Communications [email protected] Erin O’Toole Analyst, Investor Relations [email protected] 57
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