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Gold up the value chain so that this incredible project can become one of the most technically advanced gold mines in the world. With an endowment of 39 million ounces of gold in the measured and indicated resource categories (grading 2.24 grams per tonne),* we believe it is one of the largest and among the highest-grade open-pit gold projects on the planet – and considering that its footprint encompasses only three kilometers
of an eight-kilometer mineralized belt, it could grow substantially in the future. We are truly fortunate to be located on private land designated for mining in Alaska, a state with a history of support for environmentally sound and socially responsible mining – and where we’ve forged partnerships with such important stakeholders as Calista and TKC. We’re proud of the mutual trust and respect we’ve developed with residents of the Y-K region, and have every intention of building upon that track record.
Since 2012, we’ve been looking to monetize our 50% interest in the Galore Creek polymetallic project in northern British Columbia. Our patience paid off: In July 2018 we sold our share of the project to Newmont Mining Corporation for a total consideration of up to $275 million – $100 million upon closing, an additional $75 million expected no later than July 2021, and another $25 million no later than July 2023. And if a construction decision is made, we will receive an additional $75 million. It is my belief that Newmont and Teck, our former 50% Galore Creek partner, will continue advancing this important project in a responsible manner. I’d like to extend a special thank you to Teck and the Tahltan Nation, NOVAGOLD’s partners for many years, and to Newmont for its professionalism during the sale process.
As a result of the sale, we strengthened our balance sheet, ending the year with $167 million in cash, cash equivalents, and term deposits, an excellent financial position from which we can meet our current financial obligations and fund planned activities at Donlin Gold. In fact, we expect to have no need to raise capital before making a construction decision. With permitting largely complete, the focus is expected to shift to integrating scoping-level optimization work into an updated
study that will serve as the basis for a revised project development plan. With the recent completion of the merger between Barrick, our Donlin Gold partner, and Randgold, we’re looking forward to working with the new technical team and advancing the project in an efficient, responsible, and cost-effective manner. Donlin Gold is positioned to benefit from a rising gold price so that its stakeholders can reap rewards for decades to come.
At the start of 2019, we find ourselves in a
uniquely favorable position: a federally permitted
large high-grade open-pit gold project located in
a jurisdiction that welcomes responsible mining.
Add to that a strong balance sheet, time-tested
partnerships, and a revival in gold in a volatile world,
and the picture becomes clear: NOVAGOLD is strong – and we expect it to get stronger with time.
I’d like to thank all of our stakeholders, particularly Calista and TKC, for their engagement and encouragement; our shareholders for their unwavering support; our partner, Barrick, for its work and commitment; the Corps, the BLM, and the state and other federal agencies for their focus and professionalism; our board for its strategic leadership; and our dedicated employees for their hard work. Finally, on behalf of the board and the entire NOVAGOLD team, I’d like to extend a very special thank you to our esteemed fellow board members, Gerry McConnell and Gil Leathley, as well as David Deisley, our General Counsel, for their expertise and guidance – and congratulate them on their retirement.
Gregory A. Lang
President and CEO
February 11, 2019
* Donlin Gold project estimates as per the second updated feasibility study effective November 18, 2011 and amended January 20, 2012. 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. Measured resources total 8M tonnes grading 2.52 g/t Au, and indicated resources total 534M tonnes grading 2.24 g/t Au. Proven reserves total 8M tonnes grading 2.32 g/t Au, and probable reserves total 497M tonnes grading 2.08 g/t Au. See “Cautionary Note Concerning Reserve & Resource Estimates” on page 39.
Experience in building and operating large-scale gold assets.
195
YEARS
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40
Chairman of the Board
President & CEO
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Vice President, Environment, Health, Safety & Sustainability
Vice President, Engineering & Development
Vice President & Chief Financial Officer Vice President, Corporate Communications
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