Novagold Resources Inc. · AMEX:NG
Novagold Resources — Investor Presentation (March 2010)
64 slides from Novagold Resources's investor presentation, March 2010
Slide 1: Corporate Presentation
Click to edit Master title style A growth‐focused precious metals company Corporate Presentation NYSE‐AMEX, TSX: NG March 2010
Slide 2: Forward-Looking Statements
Forward‐Looking Click Forward to edit Looking Master Statements title style This presentation includes “forward‐looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included herein incl
Slide 3: Investment Highlights
Investment Click to edit Highlights Master title style 17.3M ounces Gold Reserves 8.2M ounces Gold M&I 94M ounces Silver M&I 6.0B pounds Copper M&I 5.5M ounces Gold Inferred 63M ounces Silver Inferred 3.1B pounds Copper p pp Inferred • One of the largest resource bases of any junior or mid‐tier prod
Slide 4: Geopolitically Safe Locations
Click Geopolitical Safe to edit Master Locations title style Advanced stage Exploration stage Port of Stewart N
Slide 5: Senior Operating Partners
Click toOperating Senior edit Master Partners title style With senior operating partnerships in place, NovaGold’s projects offer lower risk and higher g potential value than manyy other small p mining companies can provide. Barrick Gold – 50/50 / at Donlin Creek • World’s largest gold mining company
Slide 6: Financing Experience
Click to edit Financing Experience Master title style • Relationships with major financing syndicates, including Citigroup JP Morgan, Citigroup, Morgan RBC • Raised more than US$800 million over the last five years • March 2010 – US$175 million equity financings – Paulson & Co. US$100 million 1 – So
Slide 7: Adding Value Through Resource Growth
Adding Click to Value edit Master Through Resource title style Growth One of the industry’s best track records for resource growth Average of 3M ozs of gold added each year Billionss of lbs of co d‐equivalentt ozs opper resourrces Milllions of gold Note: Reflects 50% ownership of Donlin Creek, 50% o
Slide 8: Unparalleled Value, Unparalleled Leverage
Unparalleled Click to edit Master Value, title Unparalleled style Leverage • NovaGold offers significant value to investors: – 17.3M ozs gold reserves, 8.2M ozs M&I gold resources and 5.5M ozs inferred gold resources Æ each 10 shares of NovaGold = 1.4 ozs of ggold or 2.8 ozs of ggold equivalent (gol
Slide 9: Comparative Gold Resources in the Americas
Comparative Clickpto editGold Resources Master in the Americas title style 50 Mid‐Tier Producers old resource e 40 Junior Developers Producers 30 ons of ozs go 20 10 Millio 0 Proven & Probable Measured & Indicated Inferred Source: Metals Economics Groups. See “Cautionary Note Concerning Reserve and
Slide 10: Enterprise Value per Ounce in the Americas
Enterprise Value Click pto edit per Ounce p Master in the Americas title style Mid‐tier Producers d oz 350 Avgg $270 EV/oz esource gold 300 Recently Acquired 250 Developers Developers Junior Producers Avg $80 EV/oz Avg $105 EV/oz Avg $115 EV/oz Enterprise value per re 200 NG $53 EV/oz 150 100 50 0 S
Slide 11: Operational Overview
Click to edit Master Operational Overview title style Advanced stage Exploration stage Port of Stewart N
Slide 12: Donlin Creek
Click toCreek Donlin edit Master title style 50/50 Partnership with Barrick Gold 33 6M 33.6M ozs Gold Proven & Probable 1 4.3M ozs Gold Measured & Indicated 1 4.4M ozs Gold G ld Inferred 1 (1) At 100% basis. NovaGold owns 50%.
Slide 13: Comparison of Gold Projects in the Americas
Click toCreek Donlin edit Master title style 40 Comparison of Gold Projects in the Americas 35 30 Inferred resources Measured & Indicated resources* 25 20 15 10 5 0 Donlin li M t t Metates D t Detour Canadian C di Livengood i d A Angostura t Aurora Haile il Mine Creek 1 Malartic Grade (g/t) 2.4 0.7
Slide 14: Donlin Creek
Click toCreek Donlin edit Master title style
Slide 15: Donlin Creek Exploration
Click toCreek Donlin edit Master Exploration title style Resources are M&I category. 15
Slide 16: Donlin Creek Exploration Potential
Click toCreek Donlin edit Master Exploration title style Potential 16
Slide 17: Proposed Mine Site Layout
Donlin Click toCreek edit Proposed p Master Minestyle title Site Layout y 17
Slide 18: Access & Facilities
Click toCreek Donlin edit Master Accesstitle & Facilities style Proposed Infrastructure for the Donlin Creek Mine 18
Slide 19: Donlin Creek: One of the World's Largest Undeveloped Gold Deposits
Donlin Creek: One of the World’s Largest Undeveloped Click to editGold Depositstitle style Master Comparison of Donlin Creek with Barrick Gold’s largest gold mine Key Operating Statistics Donlin Creek (100%) 1 Goldstrike Mine 2 Years 1–5 1 5 (Open Pit) Production (ozs/year) 1.6 Million ozs/year 1.5
Slide 20: Donlin Creek vs Goldstrike Mine
Donlin Creek: One of the World’s Largest Undeveloped Click to editGold Depositstitle style Master Comparison of Donlin Creek with Barrick Gold’s largest gold mine $450 Goldstrike Proven & P P Probable b bl 10.3M ozs P&P Measured & Indicated $430 0.87M ozs M&I Inferred 0.04M ozs Inferred oz) Cash cos
Slide 21: Donlin Creek Potential Gas Power
Click toCreek Donlin edit Master – Potential title style Gas Power Donlin Creek Anchorage Cook Inlet • Potential to bring natural gas or liquid natural gas to the project • Could cut power costs by as much as 50% • Studies completed mid‐2010 Æ revise feasibility study or file permits for original de
Slide 22: Donlin Creek Value Drivers
Click toCreek Donlin edit Master Value Drivers title style • Completed feasibility study in 2009 Æ 29.3M ozs reserves • Reserve update in March 2010 with additional drilling, drilling higher gold price Æ33.6M ozs reserves 1 – One of only a few mines worldwide anticipated to produce more than 1 milli
Slide 23: Galore Creek
Click toCreek Galore edit Master title style 50/50 Partnership with Teck 8 9B 8.9B lbs Copper 4 0B 4.0B lbs Copper Measured & Indicated 1 Inferred 1 7.3M ozs Gold 4.9M ozs Gold Measured & Indicated 1 Inferred 1 123M ozs Silver 80M ozs Silver Port of Stewart Measured & Indicated 1 Inferred 1 (1) At 1
Slide 24: One of the World's Largest Undeveloped Copper-Gold-Silver Resources
Click toCreek Galore edit Master title style One of the world’s largest undeveloped copper‐gold‐silver resources 25 45Moz Au Inf 25.0 opper Resources 34.8M oz Au M&I Millions of ozss of Gold Ressources 49B lb Cu Inf 12.1M oz Au Inf 20 20.0 15 First 5 years 15.0 >1% Cu Eq q Billionss of lbs of Co 10
Slide 25: Galore Creek Mineralized Areas
Click toCreek Galore edit Master Mineralized title style Areas Included in Resources Target Areas Junction N Rim Butte West Rim Copper Canyon Middle Cr Little Creek NGL Camp Saddle Southwest Looking North West Fork 25
Slide 26: Galore Creek Proposed Facilities Layout
Galore Creek Click to Proposed edit MasterFacilities Layout (2006 design) title style Portal Butte SW Port Saddle West Fork West Rim Middle Creek Junction Pit Copper Canyon Plant Site Central Pit N h Rim North Ri Waste Rock Facility 26
Slide 27: Updated Access Route
Click toCreek Galore edit Master Updated title Access style Route Proposed Infrastructure for the Galore Creek Mine Km 48 27
Slide 28: Road Construction
Click toCreek Galore edit Master Road Construction title style • Road to Km 48, halfway to mine site • Road construction ongoing
Slide 29: Road Construction
Click toCreek Galore edit Master Road Construction title style • Road and bridge construction ongoing • Road may be completed within h next year or two
Slide 30: Galore Creek: One of the World's Largest Undeveloped Copper-Gold Deposits
Galore Creek One of the World’s Largest Undeveloped Click pp to edit Copper‐Gold pMaster title style Deposits Comparison of Galore Creek with Barrick Gold’s largest copper mine Key Operating Statistics Galore Creek Years 1–5 1,2 Zaldívar Mine 3 Production: Copper 350 to 500 M lbs/yr 295 M0 lbs/yr Go
Slide 31: Galore Creek Value Drivers
Click toCreek Galore edit Master Value Drivers title style • Project redesigned and re‐engineered – Lower costs, reduced time of construction, shorter access road – Major infrastructure moved out of Galore Creek Valley • Conventional tailings dam • Capacity for project expansion • Updated mine plan
Slide 32: Nome Operations
Click toOperations Nome edit Master title style NovaGold owns 100% 0 5M 0.5M ozs Gold Probable Reserves 1 1.9M ozs Gold G ld Measured & Indicated 1 0 3M 0.3M ozs Gold Inferred 1 (1) M&I resources exclusive of reserves.
Slide 33: Nome Operations Status
Click toOperations Nome edit Master title style • Project 90% constructed • Significant improvements to water management • Examining go‐forward f d alternatives to bring best value to shareholders • Gold production estimated at 100,000 ozs/year • Native Alaskan partners: Bering Straits and Sitnasuak
Slide 34: Ambler
Click to edit Master title style Ambler NovaGold owns 100% 1.5B lbs Copper 937M lbs Copper Red Dog Measured & Indicated Inferred Port of Nome 22 2.2B lbs Zinc 13 1.3B lbs Zinc Measured & Indicated Inferred 0.5M ozs Gold 0.3M ozss Gold o Measured & Indicated Inferred Port of Stewart 32M ozs Silver 19
Slide 35: Ambler
Click to edit Master title style Ambler • Multiple p ppromisingg targets g on property • Arctic deposit most advanced – Very V hi high‐grade h d VMS deposit: d it 4% copper, 6% zinc 0.8 g/t gold, 60 g/t silver (1) – 8% Cu equivalent • 2010 objectives – Continued community engagement – Exploration –
Slide 36: Ambler District - Arctic Deposit
Click to edit Ambler District Master – Arctic titleDeposit style
Slide 37: Arctic Property Geology
Click toProperty Arctic edit Master Geology title style Looking South ORE HORIZON ORE HORIZON
Slide 38: Arctic Deposit Cross Section
Click toDeposit Arctic edit Master Cross title Section style South AR08‐116 117 118 119 120 114 115 North B B’ B 15.0m: 2008 drill holes highlighted 5.7% Cu 15.6m: 1.1% Pb 30.8m: 30 8m: 3 1% Cu 3.1% 7 4% Zn 7.4% Z 32.8m: 32 8m: 4.3% Cu 0.2% Pb 101g/t Ag 5.1% Cu 1.1% Pb 1.3% Zn 0.8g/t Au 0.2% Pb 3.9%
Slide 39: Ambler District Geology
Click Amblerto edit Master District title style Geology Smucker Sunshine Shugnak Arctic Sun 39
Slide 40: Northwest Alaska Transportation Study
Nome Road Planning Map Click to edit Northwest Master Alaska title style Study Transportation Ambler District Source: Alaska Department of Transportation & Public Facilities.
Slide 41: Strong Projected Gold and Copper Production Growth
Strong Projected Gold and Copper Production Growth Click with Lowto edit Master Production Costs Nettitle style of Copper Credits NovaGold’s net share of estimated production Annual gold production 1200 600 Annual copper production All projects oduction 1.2 Moz Au1 Millionss of lbs of Copper Producc
Slide 42: Anticipated Low-Cost Gold Production
Click to editLow‐Cost Anticipated Master Low Costtitle Goldstyle Production Global Industry Cash Cost Curve 1200 Total Caash Cost Per Ounce of Gold ($/oz) Industry 1000 Average Cash Cost Production of >1 M ozs/yr ~$500/oz from Donlin and Galore Donlin Creek 800 net of Copper +1.5 M ozs/yr <$100/oz ~
Slide 43: New Mines Expected to Achieve Production by 2015
NG Share 43 50% DC + 50 0% GC Goldcorp p ABX/Kinro oss NovaG Gold/Teck Galore Creek Newmont NovaGold Projects: 2 of the top 10 largest M&I Gold Resources Barrickk New Mines Expected to Achieve Production by 2015 Polyus Resources NovaGold/A ABX Donlin Creek Newcrest M&Istyle Barrick/Gold dcorp Newmon
Slide 44: Forecast Peak Production
Peak Gold Pro P oduction Raate (OOO oz)) 0 200 400 600 800 1000 1200 1400 1600 1800 Buckreef IAMGOLD Click C1 Santa Luz Yamana Jeronimo Yamana Bombore IAMGOLD Bonikro Forecastto Lapa Lihir Didipio Agnico‐Eagle Oceana Peak Kittila Agnico‐Eaagle Goldex Agnico‐Eagle Cerro Blanco Goldcorp edit Kettle Ri
Slide 45: Global Gold Discoveries
Click toGold Global edit Master Discoveries title style Both Galore Creek & Donlin Creek 3% 3% are in the top 3% 14% >10M oz 80% 5‐9.9M oz 1‐4 1 4.9M 9M oz < 1M oz • Most M discoveries di i < 1M ozs goldld • Large deposits > 10M ozs are extremely rare
Slide 46: Gold Resource Ounces per Share
Gold Resource Click Ouncestitle to edit Master per Share p style 0.35 0.3 er Share 0.25 Gold Ounces pe 0.2 0.15 0.1 0.05 0 Source: Metals Economics Group as at March 18, 2010, using $1100/oz gold. 46
Slide 47: Value of Gold Resource per Dollar Invested
Value of Gold Click to Resourcetitle edit Master per Dollar p style Invested $25 With an additional $20 copper resource n US Dollarrs per dollar d ll iinvested d iin NovaGold ld $20 e of Gold in $15 $10 Value $5 $‐ Source: Metals Economics Group as March 18, 2010, using $1100/oz gold and $3.00/lb co
Slide 48: Shareholder Breakdown
Click to edit Master Shareholder Breakdown title style Top 10 Shareholders Shares O/S Insiders 7% Retail Institutional 21% Institution % O/S Other Electrum Electrum Strategic Resources 23.6 2% 24% Paulson & Co. 8.3 Institutionall Tradewinds 8.2 US Soros 7.8 46% Aletheia 6.2 Chilton Investment Compan
Slide 49: Share Capitalization
Click toCapitalization Share edit Master title style Issued and Options Warrants Fully diluted 1 outstanding outstanding 220.2M 14.1M 53.7M 287.9M • C$38M in cash plus cash equivalents as at November 30, 2009, with an additional US$175M through recent private placement • ~US$1.8B market cap (in the
Slide 50: Why NovaGold?
Click NovaGold? Why to edit Master title style Unparalleled Value Unparalleled Leverage • Large, high‐quality projects • Safe geopolitical locations • Senior operating partners • Financing experience • Resource growth • Exposure to gold and copper • Development‐stage = maximum leverage 50
Slide 51: Fundamentals for Gold Remain in Place
Fundamentals for gold remain in place Click for to edit Master continued title style higher prices • Global monetary policy has accelerated inflationary pressures • Prices for gold in real terms remain well below historical highs • Demand for gold continues to increase – Investment demand remains a
Slide 52: Increased Global Demand for Gold
Increased Click to edit Global Master Demand title style for Gold Global Gold Demand in US$ Billions $120 • Overall demand increasing Investment by US$9 billion annually $100 Industrial • Investment demand grown from 5% to >35% $80 Jewellery $60 $40 $20 $0 2000 2002 2004 2006 2008 Source: World Gold
Slide 53: Copper: Increased Demand vs Constrained Supply
Copper: Click toIncreased Demand edit Master vs Constrained title style Supply • Global demand for copper continues to increase with population growth and industrialization – Developing countries continue to build out infrastructure and urban populations are increasing – Consumers in developing coun
Slide 54: Driving Copper Demand
Click toDriving China edit Master Coppertitle Demand style Global Copper Demand Projected Demand 18000 for India & China rest of 15000 the World Demand in kt USA 12000 China hi Projected India USA Demand 9000 for China 6000 3000 0 1996 2006 2015 Other* Europe Japan India USA China * Other Asian coun
Slide 55: Driving Copper Demand: China
Click toDriving China edit Master Coppertitle Demand style Chinese demand still has a long way to go China USA China USA China USA Ratio Population Population Per Capita Per Capita Motorways (km) 1,447,200 6,711,634 1,340 M 307 M 1,080 21,862 20 Roads ((km)) 324,280 4,346,199 1,340 M 307 M 242 14,15
Slide 56: Value Drivers Next 12 Months
Click toDrivers Value edit Master Next 12 title Months style Donlin Creek 9 Continued community engagement and consultation for project permitting • Continue C ti optimization ti i ti work, k including i l di potential t ti l for f a natural t l gas pipeline i li • File permits for original project
Slide 57: Appendix
Click to edit Master title style A Appendix di
Slide 58: Sustainability Commitments
Click to edit Master Sustainability Commitments title style • NovaGold has established the framework for sustainability reporting and is workingg on its first sustainabilityy report, p to be published p in 2010 • NovaGold embraces the UN Global Compact • NovaGold supports the International Council o
Slide 59: Reserve & Resource Base
Click to edit Reserve & Resource Master title Basestyle NovaGold Resources Inc. Proven and Probable Reserves, Measured, Indicated and Inferred Resources for Gold (Au), Silver (Ag), Copper (Cu), Zinc (Zn) and Lead (Pb) As at March 12, 2010 Reserves Property Reserve Tonnes In Situ Grade Total Containe
Slide 60: Reserve & Resource Base - Footnotes
Click to edit Reserve & Resource Master title Basestyle ‐ Footnotes Notes: 1. These resource estimates have been prepared in accordance w ith National Instrument 43-101 and the Canadian Institute of Mining and Metallurgy Resource Classification System, unless otherw ise noted. 2. See numbered footno
Slide 61: Project Development Pipeline and Market Valuations by Stage
NovaGold’s Project Development Pipeline Click to edit and Market Master Valuations bytitle style Stage Development AMBLER GALORE DONLIN ROCK PROJECT CREEK CREEK CREEK RESOURCE PRE‐ PERMIT & DISCOVERY DEFINITION FEASIBILITY PRODUCTION FEASIBILITY CONSTRUCT PEA INCREASING RESOURCE INCREASING CERTAINTY
Slide 62: Invest in Growth Stage Gold
Click Invest Why to editin Growth Master Stage title styleGold? • Leverage to gold price • Increased value from resource growth & project advancement Potential for superior • Producer acquisition target shareholder returns Market Value (US$ Millions) per Million ozs of Gold Resource 150 ‐250 250 Inc
Slide 63: Investment Leverage to Increased Gold Price
Investment Leverage to Increased Gold Price Click to edit Master title style Ounces per $1,000 Investment Adjusted for Mining Costs 2.8:1 Increase in 50 0 50.0 Net Value at $1,100 w/ Cu Margin Expansion w/ 40.0 Cu By‐product $900/oz Au $1,100/oz Au $1,100 /oz Au 2:1 Increase in Net 30.0 w/ Cu By‐pro
Slide 64: Cautionary Note Concerning Reserve & Resource Estimates
Cautionary Note Concerning Reserve & Click to Estimates Resource edit Master title style This presentation uses the terms “probable reserves”, “measured”, “indicated”, “inferred” and “historical” resources. United States investors are advised that, while these terms are recognized and required by Ca
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