NOVAGOLD Reports 2017 Results as It Approaches Completion of Key Milestones in Permitting and Optimization of the Donlin Gold Project The U.S. Army Corps of Engineers (the “Corps”), the lead Federal permitting agency, is finalizing the
NYSE AMERICAN, TSX: NG
NEWS RELEASE
www.novagold.com
Page | 1
NOVAGOLD Reports 2017 Results as It Approaches Completion of Key Milestones in
Permitting and Optimization of the Donlin Gold Project
The U.S. Army Corps of Engineers (the “Corps”), the lead Federal permitting agency, is finalizing the
Donlin Gold Environmental Impact Statement (EIS) and expects to file the document in early 2018
Donlin Gold successfully completed the 2017 drill program as part of project optimization
With $84 million in cash and term deposits as of November 30, 2017, NOVAGOLD can complete
permitting and planned project optimization work at Donlin Gold, as well as meet its other financial
obligations
January 24, 2018 - Vancouver, British Columbia – NOVAGOLD RESOURCES INC. (TSX, NYSE American:
NG) today released its 2017 fourth qua rter and year-end financial results and updates for its flagship Donlin
Gold project in Alaska, which NOVAGOLD owns equally with Barrick Gold Corporation (“Barrick”) and its Galore
Creek copper-gold-silver project in British Columbia, which NOVAGOLD owns equally with Teck Resources Ltd.
(“Teck”).
Details of the financial results for the year ended November 30, 2017 are presented in the consolidated
financial statements and annual report filed on Form 10-K with the SEC that is available on the Company's
website at www.novagold.com, on SEDAR at www.sedar.com, and on EDGAR at www.sec.gov. All amounts
are in U.S. dollars unless otherwise stated and all resource and reserve estimates are shown on a 100%
project basis.
In 2017, NOVAGOLD achieved the following milestones:
Permitting of Donlin Gold is nearing completion:
Donlin Gold and the cooperating agencies have supplied the Corps with all requested information
in preparation for the final EIS, with the Record of Decision (ROD) to follow later this year
The Prevention of Significant Deterioration permit was issued by the Alaska State Department of
Environmental Conservation, Division of Air Quality on June 30, 2017
Draft water discharge and integrated waste management permits were released for a 60-day
public comment period on December 15, 2017
Other key State and Federal permits and approvals are scheduled to be finalized concurrently
with or shortly after the Corps’ ROD in 2018
Donlin Gold completed the 2017 drill program in support of its optimization work:
The drill program took place from July to November 2017 to:
▪ gather additional geochemical and structural data for targeted portions of the deposit, and
▪ further strengthen understanding of the targeted mineralized zones
16 core drill holes were completed (7,040 meters) and samples are being assayed
Optimization work continued to be advanced with the objective of establishing opportunities for
reducing the owners’ initial capital expenditures and enhancing the project’s execution plan
Community outreach efforts continued in both Alaska and Northern British Columbia:
Donlin Gold hosted project site tours to give key stakeholder representatives an opportunity to
see the proposed development location first-hand and to ask questions
In collaboration with Calista Corporation and The Kuskokwim Corporation (TKC) (owners of the
mineral and surface rights, respectively) Donlin Gold visited a number of villages across the
Yukon-Kuskokwim (Y-K) region to meet with traditional village councils, residents and students
Donlin Gold volunteered and sponsored the Clothing Extravaganza in Bethel where clothing was
collected and distributed to youth throughout the Y-K region
Donlin Gold proudly sponsored the RurAL CAP’s Elder/Foster Grandparent Program that
supports Elders in the Y-K region as they work to increase children’s school readiness,
connection to culture and academic achievement
NYSE AMERICAN, TSX: NG
NEWS RELEASE
www.novagold.com
Page | 2
Galore Creek awarded bursaries for Tahltan First Nation members pursuing post-secondary
education, including university and college programs, as well as accredited skills programs
President’s Message
Donlin Gold Project
Last year was pivotal for NOVAGOLD as the Company made significant progress toward completion of
permitting and advancing project optimization for Donlin Gold. Our team worked tirelessly to provide the Corps
with all the information required to complete the final EIS, secure the issuance of a number of major State
permits and conduct a drill program in support of the ongoing optimization work. Although permitting may
seem mundane, it requires an incredible effort and focus from everyone involved in this comprehensive six-
year process. All of us have been motivated not only to make sure we successfully complete the permitting
process for Donlin Gold, but to lay a solid foundation from which this one-of-kind project can be developed.
Donlin Gold will be life-changing, not only for our Alaska Native Corporation partners but for all the people of
the Y-K region. Our Native Corporation partners Calista Corporation and TKC, owners of Donlin Gold’s
mineral and surface rights, will finally be in the position to realize the vision inherent in the Alaska Native
Claims Settlement Act and participate in the development of a project which should serve as a source of
sustainable prosperity for all native people of Alaska for many years to come.
The Corps is finishing its last revisions to the final EIS which it plans to publish in early 2018, followed by the
issuance of a Record of Decision (ROD) in the second half of the year. We are looking forward to securing
other key federal and state permits and approvals concurrently with or shortly after the Corps' ROD. The air
pollution control permit was issued in June 2017, followed by the release of the draft water discharge and
integrated waste management permits for comments in December 2017. By all accounts, permitting is
advancing nicely toward completion in 2018.
Another key focus of 2017 was Donlin Gold’s optimization work which we advanced together with Barrick.
One of the enhancements being explored is use of more selective mining practices to increase mined grade.
We conducted a well thought-out drill program between July and November 2017. It consisted of 16 core
holes with 7,040 total meters drilled. We collected geochemical and structural data for portions of the deposit
which will further strengthen our understanding of targeted mineralized zones. Assaying of the drill core is
ongoing and will be incorporated into the optimization work, which will determine the best path forward for the
project. The owners retained an external engineering firm to help with the optimization work and look forward
to updating the market on those efforts in 2018.
Our optimization efforts are well justified. Donlin Gold is a very special project. Its endowment of
approximately 39,000,000 ounces of gold resources in the measured and indicated category and its average
grade of 2.2 grams per tonne are unique in our industry. Moreover, with planned production averaging
approximately 1,100,000 ounces of gold per year, Donlin Gold is expected to be in operation for over 27 years
and most likely beyond considering the fact that the existing mine footprint covers only three kilometers of an
eight-kilometer mineralized gold belt. We believe there is a lot more gold to be discovered at Donlin Gold. In
an age of extreme geo-political uncertainty around the world, NOVAGOLD and Barrick are truly blessed to be
advancing Donlin Gold and working in Alaska, a jurisdiction with a well-recognized culture and history of
responsible mine development.
Galore Creek Project
In 2017, the focus at Galore Creek was on-site care and maintenance with the majority of the work conducted
over the summer months. Approximately half of the employed workforce consisted of members of the Tahltan
First Nation. Since our primary objective is advancement of the flagship Donlin Gold project, NOVAGOLD’s
intention is to sell all or part of its 50% interest in Galore Creek and re-deploy the proceeds toward Donlin
Gold. We want to make sure that the value we would receive for our interest in this large high-grade copper-
gold project is reflective of its scarcity value. With escalating copper prices, there is a renewed interest in
Galore Creek, a likely core asset for any major company.
NYSE AMERICAN, TSX: NG
NEWS RELEASE
www.novagold.com
Page | 3
Stakeholder Engagement
We extensively supported the Donlin Gold and Galore Creek project teams in their community engagement
efforts by participating in meetings, tours, events and activities in Southwest Alaska and Northern British
Columbia. These commitments included several Donlin Gold site tours for key stakeholders in the Y-K region
with Calista and TKC, our Native Corporation partners, village visits and presentations to traditional village
councils, residents and students. In collaboration with TKC, Donlin Gold sponsored spill response training for
local residents and heavy equipment training in one of the villages. Donlin Gold employees volunteered for
and sponsored the Clothing Extravaganza in Bethel where clothing was collected and distributed to youth
throughout the Y-K region. We proudly sponsored RurAL CAP’s Elder/Foster Grandparent Program that
supports Elders in the Y-K region as they work to increase children’s school readiness, connection to culture
and academic achievement. We participated in the Elder & Youth Conference and the Alaska Federation of
Natives Convention in Anchorage. Donlin Gold also partnered with CISCO to offer information technology
courses to youth in the Kuspuk School District. Galore Creek awarded bursaries for Tahltan First Nation
members pursuing post-secondary education, including university and college programs, as well as
accredited skills programs.
Maintaining frequent and consistent engagement with our shareholder base is also imperative in ensuring our
success. As such, following the 2017 proxy season some members of our Board met with NOVAGOLD’s top
institutional shareholders to discuss compensation and governance matters both generally and specific to the
Company while maintaining a dialogue regarding changes to ensure effective management as the Company
evolves.
Balance Sheet
We continued to prudently manage our treasury. With $84 million in cash and term deposits as of November
30, 2017, we have sufficient funds to complete permitting and planned project optimization work at Donlin
Gold, as well as meet our other financial obligations.
With unique and high-quality deposits like Donlin Gold and Galore Creek located in top mining jurisdictions,
coupled with the scarcity value of projects that have been de-risked, we believe NOVAGOLD will become one
of the go-to gold stocks in the space. The progress to date is a testament to the engagement, trust,
collaboration and support from our partners: Calista, TKC, Barrick, and Teck; the great work by the
Company’s employees and the project teams at Donlin Gold and Galore Creek, as well as the government
agencies in the regions where our projects are located. I’m thankful for the Board of Directors’ active
engagement with our shareholders over the last year and their ongoing guidance that is key to our success.
Gregory A. Lang
President & CEO
NYSE AMERICAN, TSX: NG
NEWS RELEASE
www.novagold.com
Page | 4
Financial Results
in thousands of U.S. dollars, except for per share amounts
Year ended
November 30, 2017
$
Year ended
November 30, 2016
$
General and administrative expense (1) 20,802 20,179
Share of losses – Donlin Gold 11,219 8,819
Share of losses – Galore Creek 1,676 1,149
Total operating expenses 33,697 30,147
Loss from operations (33,697) (30,147)
Other expense (4,587) (3,422)
Income tax expense (732) (277)
Loss for the period (39,016) (33,846)
Loss per share, basic and diluted (0.12) (0.11)
At
November 30, 2017
$
At
November 30, 2016
$
Cash and term deposits 83,954 105,274
Total assets 398,869 408,261
Total liabilities 114,840 107,998
(1) Includes share-based compensation expense of $10,294 and $10,263 for the year-ended November 30, 2017 and 2016, respectively.
For the year ended November 30, 2017, NOVAGOLD reported an increase in loss from operations of $3.6
million from $30.1 million in 2016 to $33.7 million in 2017. The increase resulted from the 2017 Donlin Gold
drilling program ($3.3 million), increased care and maintenance activity at Galore Creek ($0.5 million), higher
general and administrative costs ($0.6 million), partially offset by lower permitting costs at Donlin Gold ($0.9
million).
Net loss increased from $33.8 million ($0.11 per share – basic and diluted) in 2016 to $39.0 million ($0.12 per
share – basic and diluted) in 2017. The $5.2 million increase resulted from the loss from operations ($3.6 million)
and an increase in other expense ($1.2 million). Other expense increased due to higher interest expense on the
Barrick promissory note ($0.7 million), foreign exchange movements ($0.7 million) and deferred income tax
expense ($0.4 million) due to an increase in the British Columbia provincial income tax rate, partially offset by
increased interest income on term deposits ($0.2 million).
Liquidity and Capital Resources
Spending for Donlin Gold and Galore Creek projects, along with general and administrative costs totaled
$23.5 million in 2017, and was lower than our 2017 outlook of $27 million, mainly due to lower than expected
permitting and optimization work expenditures at Donlin Gold. The net change in cash and term deposits was
also favorably impacted by higher interest income and working capital changes, resulting in a net decrease in
cash and term deposits of $21.3 million.
As previously acknowledged, we believe that our cash and term deposits are sufficient to cover the
anticipated funding at the Donlin Gold and Galore Creek projects in addition to general and administrative
costs through completion of permitting at the Donlin Gold project. The term deposits are denominated in U.S.
dollars and held at two Canadian chartered banks.
NYSE AMERICAN, TSX: NG
NEWS RELEASE
www.novagold.com
Page | 5
2018 Outlook
Similar to 2017, we anticipate a total budget of approximately $28 million in 2018, $14 million to fund our share
of expenditures at the Donlin Gold project, which includes permitting costs of $9 million and project optimization
work of $5 million, $3 million at the Galore Creek project and $11 million for general and administrative costs.
NOVAGOLD remains focused on five primary goals in 2018: advance the Donlin Gold project toward a
construction/ production decision; maintain a favorable reputation of the Company and its projects among
shareholders, Native entities and other stakeholders; promote a strong safety culture, maintain a zero lost time
accident record at all project and office locations; and safeguard the treasury.
Conference Call & Webcast Details
NOVAGOLD’s conference call and webcast to discuss these results will take place on January 25, 2018 at 8:00
am PT (11:00 am ET). The webcast and conference call-in details are provided below.
Webcast: www.novagold.com/investors/events/
North American callers: 1-855-475-2134
International callers: 1-661-378-9964
Conference ID: 7065468
The webcast will be archived on NOVAGOLD’s website for one year. To request a transcript of the call,
please email us at: [email protected].
About NOVAGOLD
NOVAGOLD is a well-financed precious metals company focused on the permitting and development of its
50%-owned Donlin Gold project in Alaska, one of the safest mining jurisdictions in the world. With
approximately 39 million ounces of gold in the measured and indicated resource categories , inclusive of
proven and probable reserves (541 million tonnes at an average grade of approximately 2.2 grams per tonne),
Donlin Gold is regarded to be one of the largest, highest grade, and most prospective known gold deposits in
the world. According to the Second Updated Feasibility Study (as defined below), once in production, Donlin
Gold is expected to produce an average of more than one million ounces per year over a 27-year mine life on
a 100% basis. The Donlin Gold project has substantial exploration potential beyond the designed footprint
which currently covers only three kilometers of an approximately eight-kilometer long gold-bearing trend.
Current activities at Donlin Gold are focused on permitting, optimization work, community outreach and
workforce development in preparation for the construction and operation of this top tier asset. NOVAGOLD
also owns 50% of the Galore Creek copper-gold-silver project located in northern British Columbia. According
to the 2011 Pre-Feasibility Study (as defined below), once in production, Galore Creek is expected to be the
largest copper mine in Canada, a tier-one mining jurisdiction. NOVAGOLD anticipates selling all or a portion
of its interest in Galore Creek and would apply the proceeds toward the development of Donlin Gold. With a
strong balance sheet, NOVAGOLD is well positioned to stay the course and take Donlin Gold through
permitting.
Scientific and Technical Information
Certain scientific and technical information contained herein with respect to Donlin Gold is derived from the
“Donlin Creek Gold Project Alaska, USA NI 43-101 Technical Report on Second Updated Feasibility Study”
prepared by AMEC with an effective date of November 18, 2011, as amended January 20, 2012 (the “ Second
Updated Feasibility Study”). Kirk Hanson, P.E., Technical Director, Open Pit Mining, North America, (AMEC,
Reno), and Gordon Seibel, R.M. SME, Principal Geologist, (AMEC, Reno) are the Qualified Persons
responsible for the preparation of the independent technical report, each of whom are independent “qualified
persons” as defined by NI 43-101.
Certain scientific and technical information contained herein with respect to Galore Creek is derived from the
technical report entitled "Galore Creek Project British Columbia NI 43-101 Technical Report on Pre-Feasibility
NYSE AMERICAN, TSX: NG
NEWS RELEASE
www.novagold.com
Page | 6
Study" dated effective July 27, 2011 (the "2011 Pre-Feasibility Study"). The Qualified Persons responsible for
the preparation of the independent technical report are Greg Kulla, P. Geo., Principal Geologist (AMEC
Americas Limited), and Jay Melnyk, P. Eng. (AMEC Americas Limited), each of whom are independent
"qualified persons" as defined by NI 43-101.
Clifford Krall, P.E., who is the Mine Engineering Manager for NOVAGOLD and a “qualified person” under NI 43 -
101, has approved the scientific and technical information related to the Donlin G old and Galore Creek projects
contained in this press release.
NOVAGOLD Contacts:
Mélanie Hennessey
Vice President, Corporate Communications
Erin O’Toole
Senior Stakeholder Relations Specialist
604-669-6227 or 1-866-669-6227
Cautionary Note Regarding Forward-Looking Statements
This press release includes certain “forward-looking information” and “forward-looking statements” (collectively “forward-looking
statements”) within the meaning of applicable securities legislation, including the United States Private Securities Litigation Reform Act of
1995. All statements, other than statements of historical fact, included herein including, without limitation, the timing of permitting and
potential development of Donlin Gold, statements relating to NOVAGOLD’s future operating and financial performance, outlook, production
estimates, and the potential sale of all or part of NOVAGOLD’s interest in Galore Creek are forward-looking statements. Forward-looking
statements are frequently, but not always, identified by words such as “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 may include statements regarding the 2018 outlook; exploration potential of Donlin Gold; mine life and
production estimates at Donlin Gold; perceived merit of properties; anticipated permitting timeframes; exploration results and budgets;
mineral reserve and resource estimates; work programs; capital expenditures; timelines; strategic plans; completion of transactions; market
prices for precious and 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
NOVAGOLD’s expectations include the uncertainties involving the need to obtain permits and governmental approvals; 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
with Barrick Gold Corporation and Teck Resources Limited for the continued exploration and development of the Donlin Gold and Galore
Creek properties, respectively; the need for cooperation of government agencies and native groups in the development and operation of
properties; 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, which could include significant increases in estimated capital and operating costs; fluctuations in metal prices and currency
exchange rates; and other risk and uncertainties disclosed in NOVAGOLD’s Annual Report filed on Form 10-K for the year-ended
November 30, 2017 with the United States Securities and Exchange Commission, Canadian securities regulators, and in other NOVAGOLD
reports and documents filed with applicable securities regulatory authorities from time to time. NOVAGOLD’s forward-looking statements
reflect the beliefs, opinions and projections on the date the statements are made. NOVAGOLD assumes no obligation to update the
forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law.
Cautionary Note to United States Investors
This press release has been prepared in accordance with the requirements of the securities laws in effect in Canada, which differ from the
requirements of U.S. securities laws. Unless otherwise indicated, all resource and reserve estimates included in this press release 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 (CIM)—CIM Definition Standards on Mineral Resources and Mineral
Reserves, adopted by the CIM Council, as amended (“CIM Definition Standards”). NI 43-101 is a rule developed by the Canadian
Securities Administrators which establishes standards for all public disclosure an issuer makes of scientific and technical information
concerning mineral projects. Canadian standards, including NI 43-101, differ significantly from the requirements of the United States
Securities and Exchange Commission (SEC), and resource and reserve information contained herein 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.
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. Investors are cautioned not to assume that all or any part of
“measured” or “indicated resources” will ever be converted into “reserves”. Investors should also understand that "inferred mineral
NYSE AMERICAN, TSX: NG
NEWS RELEASE
www.novagold.com
Page | 7
resources” have a great amount of uncertainty as to their existence and great uncertainty as to their economic and legal feasibility. 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 by NOVAGOLD in compliance with NI 43-101 may not qualify as "reserves” under SEC standards. Neither Donlin Gold
nor Galore Creek have known reserves, as defined under SEC Industry Guide 7. Accordingly, information concerning mineral deposits
set forth herein may not be comparable with information made public by companies that report in accordance with U.S. standards.