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successfully moving the project through permitting and up the value chain. We are also proud that First Eagle, which has one of the top mining investment teams in the business, saw the opportunity to take a position in NOVAGOLD during low commodity prices. NOVAGOLD was actually the first development-stage, non- production mining company in which First Eagle made a sizable investment. We are also enormously excited that the most recent investor to join this stellar group is Saudi Arabia’s Public Investment Fund. Their share interest in the company represents an investment of nearly $150 million. Taken together with the premier sovereign wealth funds who are investors in Electrum – namely, Mubadala and the Kuwait Investment Authority – one can discern a strong core of financial backing for our strategies.
The institutional support makes a great deal of sense. Owning an asset which starts at approximately 39 million gold ounces in the measured and indicated mineral resource categories29 and could well evolve into the largest pure gold mine in the world – and at
a grade that is twice the industry average at that – in and of itself would be a beautiful thing for a sophisticated investor to behold. Then comes the octane we provide – the leverage to higher gold prices that we discussed earlier is very apparent in the numbers. That alone could be an important reason why NOVAGOLD is so fortunate to have such highly qualified shareholders seeking strong leverage to escalating gold prices. If as we believe all roads lead to higher gold prices, I think a superhighway leads straight to Donlin – and that’s good for everybody involved.
Lastly, there is one additional factor that we believe shines through when we meet with our investors. And that is our previously mentioned emphasis on simple virtues, like not cutting any corners and doing it right. Our shared mantras that inform anything from technical work to the environmental and social license we value so highly have served our shareholders well and given us considerable credibility. Part of that ethos is that we all feel deeply that honor – yes, honor – matters. Thus, the vows that we have made to our shareholders, stakeholders, and partners have been consistently kept and, as a result, our company has since been enjoying a coterie of exceptionally well-informed, savvy, and satisfied shareholders.
AS YOU JUST ALLUDED TO, RECENT DISCLOSURES SHOW THAT THE PUBLIC INVESTMENT FUND (PIF) OF SAUDI ARABIA ACQUIRED 16+ MILLION SHARES OF NOVAGOLD OVER THE PAST TWO QUARTERS. CAN YOU PROVIDE FURTHER COLOR ON THE SIGNIFICANCE OF THAT INFORMATION?
We are delighted by the news that last year PIF made a significant investment in NOVAGOLD, and as of the latest filing dated December 31, 2020 is our fifth largest shareholder with
an ownership of over 16 million shares. PIF is widely considered
to be one of the world’s savviest sovereign wealth funds.
Their investment is thus very meaningful to us on many levels. Although our first engagement with PIF began as a discussion about potentially getting the fund involved in possible future project financing, it is gratifying to observe PIF’s appreciation of
the tremendous value inherent in the stock of NOVAGOLD – and indeed acting on it. After performing their due diligence, PIF
clearly realized that any future equity raise would likely happen
at much higher levels, much later. As such, PIF concluded that it would make sense to act now and secure the benefit of that uplift by buying shares in the open market sooner rather than later. We hope to deepen this very promising relationship and welcome their participation in our future success.
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Q+A
29 Donlin Gold data as per the Donlin Gold Second Updated Feasibility Study (as defined herein). Donlin Gold measured resources of approximately 8 Mt grading 2.52 g/t and indicated resources of approximately 534 Mt grading 2.24 g/t, each on a 100% basis and inclusive of mineral reserves. Mineral resources have been estimated in accordance with NI 43-101.
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