Nova goldfeb13bmo presentation

BMO CAPITAL MARKETS
22ND GLOBAL METALS & MINING CONFERENCE

February 25, 2013
1
NYSE-MKT, TSX: NG www.novagold.com

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 and Galore Creek’s future operating or
financial performance, are forward-looking 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 the Galore Creek Pre-Feasibility
Study. Froward-looking statements 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 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; 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 risk 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 management’s beliefs, opinions and projections on the date the
statements are made. Except as required by law, the Company assumes 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. 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.

2

THE NOVAGOLD OPPORTUNITY
Tier 1 Projects – Exceptional in Scale, Quality and Jurisdictional Safety

Donlin Gold
▸ In terms of combined size, grade,
exploration potential, production
profile and jurisdictional safety,
Donlin Gold is arguably the most
important undeveloped gold
project in the world
▸ Permitting commenced in Q3/12

Galore Creek
▸ If placed into production, as per
the latest Pre-Feasibility Study,
would be the largest and lowest
cash cost copper mine in Canada
▸ Pursuing divestiture to fund
development of Donlin Gold

3

THE NOVAGOLD OPPORTUNITY
Institutional Quality Investment

Solid. 80% Institutional Ownership
▸ Significant High Grade Reserves Electrum Group Lifted Stake to 27%1
▸ Excellent Exploration Potential
▸ Experienced Management Team Top Shareholders 2
Electrum Strategic Holdings, L.L.C
Secure. Paulson & Co. Inc.
▸ Healthy Balance Sheet The Baupost Group, L.L.C.
▸ Jurisdictional Safety
Vinik Asset Management, L.P.
Fidelity Management & Research
Golden. Company
▸ Committed to Shareholder Value
▸ Superior Leverage to Gold

1) Based on the 12.31.12 13-D filings
2) For the exception of Electrum Strategic Holdings, LLC, shareholder positions are
based on the 12.31.12 13-F filings

4

NOVAGOLD: MEETING THE MILESTONES FOR 2012
A Year Of Accomplishments Advancing NOVAGOLD Up the Value Chain
2013
NOVAGOLD
Pure Gold
Play
Q4 - 12

Q4 - 12

Q4 - 12 Strengthened
management
Notice of team with
Q3 - 12 permitting,
Intent to
prepare an development
Q2 - 12 Rock Creek and CSR
divestiture EIS for
Donlin Gold experience
completed
Q1 - 12 Donlin Gold published in
Updated Federal
NovaCopper Feasibility Register
spinoff Study
accepted &
Bought-deal permitting
financing initiated
US$318M
(net)

5

2013 GOALS AND MILESTONES
Focused on Advancing Our Projects On Time and On Budget

Q4 - 13

Q4 - 13
Update on
Q3 - 13
Donlin Gold
Preliminary
Q2 - 13 Donlin Gold Draft EIS
cost Progress
Galore reduction
Q1 - 13 Creek opportunities
update
Q1 - 13 Complete
public
Galore scoping for
Creek Donlin Gold
exploration EIS
Received
$54.0 M drill results
proceeds
from in the
money
warrants

6

THE RIGHT PROJECT – DONLIN GOLD
Arguably the World’s Most Significant Gold Project

Largest gold project in development

Among the highest grade large-scale open-pit deposits

Excellent expansion potential along strike & at depth

Poised to be world’s largest gold producer, one of only six >1Moz/year

Safe: In Alaska, 2nd largest gold producing state in U.S.

7

DONLIN GOLD: THE LARGEST DEVELOPMENT-STAGE GOLD DEPOSIT
Feasibility Study in Place and Permitting Underway

45

40 39.0

35

30
M&I Au Resources (Moz)

25.8
25

20 19.0
16.5
14.6 14.0
15

10

5

--
Donlin Gold Detour Lake Metates Livengood Rosia Montana Kibali

LOCATION: USA CANADA MEXICO USA ROMANIA D.R. CONGO

Source: Donlin Gold data as per Donlin Creek Gold Project Alaska, USA, NI 43-101 Technical Report on Second “Updated Feasibility Study”, effective November 18, 2011, as amended January 20,
2012 (the “Updated Feasibility Study”). 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. RBC peer group data based on large, open pit, gold focused development projects.

8

DONLIN GOLD: AMONG HIGHEST-GRADE DEPOSITS IN THE WORLD
Large-Scale Open-Pit Gold Development

4.00

3.50 3.38

3.00

2.50
M&I Au Grade (g/t)

2.24

2.00

1.50
1.30
1.04
1.00

0.55 0.50
0.50

--
Kibali Donlin Gold Rosia Montana Detour Lake Livengood Metates

LOCATION: D.R. CONGO USA ROMANIA CANADA USA MEXICO

Source: Donlin Gold data as per the Updated Feasibility Study. 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. RBC peer group data based on large, open pit, gold focused development projects.

9

DONLIN GOLD: SUBSTANTIAL EXPLORATION POTENTIAL
Multiple Drill Prospects and Targets Exist Along 8km Trend

▸ Future mine situated in 3km
segment of 8km mineralized
trend
▸ Over the last six years, the
mineral endowment has more
than doubled
▸ Located largely on private land,
designated for mining
▸ Gold-bearing drill holes along
the 8km trend
▸ Exploration upside:
• In-pit resource conversion
• In-pit/deep-pit exploration
• Near-pit targets (East ACMA,
3km = 39 Moz M&I (including 34 Moz P&P), 6 Moz Inferred1 Akivik Zone and Snow)
• Area resource potential
1) See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource Base” with footnotes in the appendix.

10

DONLIN GOLD: ANTICIPATED TO BE TOP-TIER PRODUCER
By Far the Largest Evolving Gold Producer from Existing Projects
1.60
1
1.50

1.40

1.20
LOM Average Annual Au Production (Moz)

2
1.10
1.00

0.80 0.76

0.66
0.60
0.60 0.56
0.51

0.40

0.20

0.00
Donlin Gold Metates Detour Lake Kibali Livengood Rosia Montana

LOCATION: USA MEXICO CANADA D.R. CONGO USA ROMANIA

Source: Donlin Gold data: Updated Feasibility Study. 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. RBC peer group data based on large, open pit, gold focused development projects.
1) Projected annual gold production during first five full years of mine life
2) Projected annual gold production during full life of mine

11

JURISDICTIONAL SAFETY BECOMING THE “EXISTENTIAL” INVESTMENT
CRITERION
“Large-Scale Quality Assets” Raising the Question “Where in the World Are You?”

• Recently highlighted regions/countries
with heightened geopolitical risk

▸ Accelerated industry focus on jurisdictional safety and resource nationalism in
many of the largest gold and copper-producing countries
▸ Countries such as Mongolia, Kyrgyzstan, Dominican Republic, Peru,
Argentina, Indonesia and Ghana have all stated their intentions to seek
higher mining taxes and royalties
▸ Civil and labor unrest in South Africa, Congo, Zambia and Greece with
countries looking to get an increased stake in mining companies
▸ Very limited number of quality assets in low geo-political risk jurisdictions
12

MINES THE SIZE OF DONLIN GOLD ARE SCARCE
Only Six Projects in the World are Slated for Ore Producing >1Moz/year

CORTEZ
USA 1

156 MINES
>100 Koz MURUNTAU
Uzbekistan
1
21 MINES 3 MINES/PROJECTS
GOLDSTRIKE
>500 Koz USA Located in North America, a safe
jurisdiction
Donlin Gold: only undeveloped
8 MINES YANACOCHA asset in this category
>800 Koz Peru

PUEBLO VIEJO
6 MINES/ Dominican Republic
Projects
>1 Moz
DONLIN GOLD
USA
▸ 1.5 Moz/year in first five full years2
▸ 1.1 Moz/year LOM2
Source: RBC
1) Based on 2011 actual production where available, excludes Newmont’s Nevada operations that consist of multiple mines, and excludes Tasiast
as Kinross has elected to undertake a Pre-Feasibility Study (PFS) for construction of a mid-sized CIL mill in the 30,000 tonne per day range, for
purposes of comparison with the 60,000 tonne per day mill expansion option. Analysis includes life of mine data for Donlin Gold
2) If put into production as contemplated by the Updated Feasibility Study

13

MAJOR DISCOVERIES ARE INCREASINGLY RARE
Very Few and No Easy Quality Development Assets Left

Significant
decline in gold
discoveries
since 2006

Gold reserves
are being mined
out at a high rate

Source: Metals Economics Group – Strategies for Gold Reserves Replacement 2012

Note: Major gold discoveries based on a cut off of 2 M/oz of gold in total reserves, resources and past production (or at
least 1 M/oz in defined reserves)

14

THE CLIMATE OF DECLINING GRADE AND ESCALATING COSTS
Donlin Gold Has Among the Highest Grade for an Open-Pit Deposit

Grade, g/t Cost US$/oz
2.5 1,200

Donlin Gold Mining
1
2.24 g/t average Mined grade
M&I grade 2.0
36% 1,000

above reserve grade
“Reserve grade are
800
down 50% over 10 Reserve grade
1.5
years negatively
impacting 600
production cost
and capex which 1.0

have tripled in the 400
same time period”
0.5
Pierre Lassonde, 200

DGF 2012
0.0 0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Total cash cost Depreciation Exploration & sustaining capex Other and administrative 2

Source: GFMS Mine Economics, LBMA, World Gold Council
1) 2002-2004 data set includes primary gold mines only, 2005 onwards, includes porphyry copper gold mines
2) Includes exceptional items

15

THE PRODUCTION CLIFF – AN INEVITABLE PHENOMENON
Donlin Gold Project to Come into Play at a Key Time for the Industry

Donlin Gold expected to commence production 1.5M oz Au/yr1

▸ 2017 onward, material declines in gold production across the industry
▸ Project queue & discovery frequency inadequate to replace production,
creating a supply-demand disequilibrium in gold
Source: National Bank Financial – The Gold Production Cliff; Industry Congestion Part 3, January 31, 2013.
Note: Based on Company Reports, NBF Estimates
1) Projected annual gold production during first five full years of mine life as per the Updated Feasibility Study

16

RESERVE BURN RATE
Large Development Projects are Needed to Maintain Current Production Levels
30

26

25

Large deposits 21
rapidly depleting 20
20
reserves 18

16
The industry 15
Years

15
15
needs large
mines to sustain
production levels 10

5

0
NOVAGOLD Goldfields Kinross Goldcorp Anglogold Ashanti Newmont Barrick
2011 Attributable Recoverable
17.2 70.0 47.7 45.4 67.9 79.3 114.6
P&P Reserves (Moz.)

2011 Attributable Annual
0.7 3.3 2.4 2.5 4.3 5.2 7.7
Production (Moz.)

Note: Based on public filings and websites. Annual production figures represent 2011 annual production for public peers and steady-state production estimate for Donlin Gold as per the most recent
Updated Feasibility Study. See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource Base” with footnotes in the appendix.

17

DONLIN GOLD: POISED TO BE WORLD’S BIGGEST GOLD MINE
Expected Production Rivals 10 Largest Existing Gold Mines

1.60
1
1.50
1.44 1.42
1.40
1.29

1.20
1.09
Gold (M/oz)

1.10 2
1.00 0.96

0.83
0.79 0.79
0.80 0.76 0.74

0.60

0.40

0.20

0.00
Donlin Gold Grasberg Mine Cortez Yanacocha Goldstrike Veladero Vaal River The Super Pit West Wits Lagunas Norte Boddington
SOUTH SOUTH
LOCATION: USA INDONESIA USA PERU USA ARGENTINA AUSTRALIA PERU AUSTRALIA
AFRICA AFRICA

Source: Cole Latimer, “World’s ten biggest gold mines – three mining majors dominate list,” Australian Mining, Mineweb, August 13, 2012. http://www.mineweb.com/mineweb/view/mineweb/en/page34?oid=156837&sn=Detail
A listing of the world's ten largest gold mines by gold output according to 2011 production figures.
1) Projected annual gold production during first five full years of mine life as per the Updated Feasibility Study.
2) Projected annual gold production during full life of mine as per the Updated Feasibility Study.
See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource Base” with footnotes in the appendix.

18

DONLIN GOLD
Projected to be Among the Low Cost Producers

First Five Years Cash Costs Life of Mine Cash Costs

Area US$/oz Area US$/oz
Open-pit mining1 133 Open-pit mining1 228
Processing 208 Processing 257
G&A, Royalties, land & 68 G&A, Royalties, land & 100
other2 other2
Total $409 Total $585

▸ First 5 full years of production at cash cost of US$409/oz, accelerating
payback
▸ Processing costs include power generation and natural gas delivery
▸ Industry average 2012E cash cost is US$673/oz3
Source: Updated Feasibility Study
1) Net of deferred costs
2) Based on US$1,200/oz gold price and an exchange rate of $1.10 CAD/USD
Source: Metals Economics Group, Company Reports, RBC Research Estimates
3) Based on 168 primary gold mines with aggregate 2011 production of ~29Moz Au

19

DONLIN GOLD IS EXPECTED TO GENERATE SUBSTANTIAL CASH FLOWS
Significant Leverage to Gold & Fast Payback at a Broad Range of Gold Prices

All Amounts in US Dollars
$30,000

$26,803
$25,000
Cumulative Net Cash Flow (US$ millions) '
Net Cash Flow (millions)

$20,000
Rich Ore Body With a 27-Year Mine Life
and Extensive Exploration Upside $19,075
~4.5x
$15,000
$14,444 leverage
$11,459
$10,000

$6,025
$5,000

$0

($5,000)

($10,000)
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
$1,200/oz Au $1,500/oz Au $1,700/oz Au $2,000/oz Au $2,500/oz Au

Source: Updated Feasibility Study

20

DONLIN GOLD HAS EXCEPTIONAL LEVERAGE TO GOLD
NPV Increases ~20x with ~2x Increase in Gold Price
All amounts in US dollars
30,000

$27.0B

25,000
NPV (US$ millions)

20,000 $19.2B

$14.6B
15,000

10,000

$6.2B

5,000

0
$1,200 $1,700 $2,000 $2,500

Gold Price
NPV at 5% NPV at 0%

Source: Updated Feasibility Study. 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; $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. See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource Base” with footnotes in the appendix.

21

THE RIGHT LOCATION – ALASKA
Right Project, Location & Stakeholders Should Lead to Orderly Permitting

▸ Alaska is the second largest U.S.
gold-producing State
▸ Five major gold producing mines
and counting
▸ Natural resource projects integral
to the State’s economy
▸ Strong commitment to
responsible mining
▸ Donlin Gold has no proximity to
major population areas; located
on private land designated for
mining
▸ Strong and time-tested
community support

22

THE RIGHT STAKEHOLDERS
Jurisdictional Safety is More Than Geographic Location
Great Partners “Calista supports responsible resource
development…The Donlin Gold project
▸Calista Corporation
presents us with an opportunity for
▸The Kuskokwim Corporation tremendous economic potential right in
▸50/50 joint-ownership with Barrick Gold our Region.”
– June MacAtee, Calista Corporation VP

23

CONVENTIONAL MINING AND MILLING PROCESS
Well Tested and Available Technology

24

DONLIN GOLD: STANDARD TECHNOLOGY
Well Established Mining and Mineral Processing Methodology
Donlin Gold Pueblo Viejo
Capital Expenditures US$6.7B1 ~US$4.0B2

Location Alaska, US Sanchez Ramirez, Dominican Republic

Mining Method Open Pit Open Pit

Project Status Permitting Start up

Total M&I Resources 39.0 Moz 36.3 Moz
(inclusive of reserves)
Nameplate 53,500 24,000
Design Throughput (tpd)

M&I Grade (g/t) 2.24 2.41

Expected Average Annual Production 1,500,000 3 1,042,000 – 1,125,000 3
(oz)
Processing Method Flotation/Autoclaving/Leaching Autoclave/Leaching/Ag/Cu

Number of Autoclaves 2 medium 4 large

Key Infrastructure Natural gas pipeline/Power plant Power plant/Oxygen plant
Oxygen plant Lime Kilm

Mine Life 27 years 25 years

Source: Updated Feasibility Study, company documents, public filings and websites. 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.
1) Capital expenditure shown on a 100% project basis
2) Capital expenditure of US$3.7B disclosed in Barrick Gold’s press release dated 01/15/13, plus a net incremental cost of approximately $300M for the power plant
3) Production expected for first full five years of operation

25

DONLIN GOLD
Well Positioned to Reduce Capex by Sharing Upfront Costs with Third Parties
Areas US$M Capital Reduction Opportunities
Mining 345 Leasing equipment ~$170M
Site preparation/roads 236
Process facilities 1,326 Oxygen plant could be built by third party ~$130M
Tailings 120
Utilities 1,302 Gas pipeline could be built by third party ~$700M
Ancillary buildings 304
Off-site facilities 243
Total Direct Costs 3,876
Owners’ cost 414
Indirects 1,405
Contingency increases confidence to 85% and is a
Contingency 984
reflection of the conservative nature of the feasibility study
Total Indirect &
2,803
Contingency
Total Project Cost 6,679 >$1B potential capital reductions

26

DONLIN GOLD
Robust Contingency Represents 25% of Hard Assets

Potential Capex Reduction from $6.7B1 to $5.7B (amounts in US dollars)
~$1B in Contingency is a Reflection of the Conservative Nature of the Updated Feasibility Study

Surface/Mill3
$1.2B
Capital
Expenditures
$4.7B

Utilities2 $2.6B Owner's Cost
$414M

Contingency
$984M

Indirect $1.4B Capital
Expenditures
Reduction
Opportunities Include: Opportunities
- Third-party built gas pipeline
~$1.0B
Contingency - Third-party built oxygen plant
$984M - Leasing mining equipment

1) Represents 100% of capital expenditures to be shared equally with co-owners Barrick Gold Corporation
2) Utilities include process facilities (ie: oxygen plant) and utilities (ie: gas pipeline)
3) Surface/Mill: Mining, site preparation, roads, tailings, ancillary buildings and off-site facilities

27

DONLIN GOLD PERMITTING PROCESS
Regulatory Process Currently Focused on Environmental Impact Statement (“EIS”)
What is an EIS?
A disclosure document that is part
of the regulatory process and led
by the U.S. Army Corps of
Engineers that provides the What is the Permitting Process?
agencies and the public with Concurrent with and supported by the EIS process, the Federal and State regulatory
information needed to make agencies will consider all of the required permits and authorizations for the project.
permitting decisions on the project

Record of
Preliminary Decision
Notice of Public Public Final
Draft EIS Draft EIS subject to
Intent Scoping Comment EIS/Permit
30-Day
Period Issuance
Appeal
Period

2012 2016
Permitting Process ~3-4
Impacts Discussed in the EIS years

• Hydrology • Fish & Aquatic Habitat
• Air & Water Quality • Wildlife • Cultural Resources
• Noise • Socioeconomics • Visual Resources
• Wetlands • Threatened & Endangered Species • Recreation, Safety & Feasibility
• Cumulative Impacts • Land Use and Subsistence

28

GALORE CREEK
Projected to be Largest Copper Mine in a Mining-Friendly Jurisdiction, Canada
Location BC, Canada

Mining Method Open Pit

Owners 50/50 (NG/TCK)

P&P Copper 6.8 Blb 0.6%
Reserves 1, 2
Gold 5.45 Moz 0.32 g/t

Silver 102 Moz 6.0 g/t

M&I Resources1, 3 Copper 8.9 Blb 0.5%

Gold 8.0 Moz 0.3 g/t

Silver 136 Moz 5.2 g/t

▸ NOVAGOLD continues to evaluate the potential sale of its share of Galore Creek
▸ Once in production, as envisioned by the Pre-Feasibility Study, Galore Creek is expected to be
the largest and lowest cash cost copper mine in Canada
▸ NPV of $837M (pre-tax) using base case metal price assumptions 4 and $4.1B (pre-tax) in
current commodity price environment5
1) See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource Base” with footnotes in the appendix.
2) P&P: Proven and Probable reserves
3) M&I: Measured and Indicated resources inclusive of Proven and Probable reserves
4) Galore Creek 2011 PFS estimated net present value (NPV7%) base case at US$2.65/lb copper, US$1,100/oz gold and US$18.50/oz silver with a foreign exchange rate of US$0.91 = Cdn$1.00
5) Current commodity price environment assuming US$3.50/lb copper, US$1,600/oz gold and US$30/oz silver and keeping the exchange rate the same as in the Galore Creek 2011 PFS

29

GALORE CREEK
2012 Drilling Program Extended Mineralization Substantially Beyond Pit Limit

▸ Completed 27,873 meter drilling program expected to result in increased
resources and provide further support for future mine design
▸ Significant intercepts, including 86 meters grading 1.31%Cu and 0.46g/t Au,
lead to the discovery of the new Legacy zone, a 700 -meter long mineralized
zone, currently open in all directions and adjacent to the Central Pit1

1) Source: NOVAGOLD press release, NOVAGOLD Reports Discovery of 700 Meter Legacy Zone at Galore Creek Mineralization is Extended Substantially beyond the Pit Limits, dated 25/2/13.

30

GALORE CREEK
Well Positioned to Update Resource Model and Improve Overall Economics

▸ 2013 work and exploration budget $8 million (50%)
▸ Update resource model with 2012 drill results
▸ Drilling to define the extent of the Legacy mineralization, and assess its
impact to future mine design.
▸ NOVAGOLD continues to enhance the value of Galore Creek through
exploration and technical studies on a reduced budget

31

NOVAGOLD’S FUTURE FINANCIAL OBLIGATIONS HAVE DECREASED
SUBSTANTIALLY
Clear Focus Begins with Strong Funding to Execute on All Fronts
Highlights: 140.0
Lower Spending
$5
▸ $253M in cash and cash equivalents1
120.0
▸ $54M additional proceeds received $21
from warrant exercise Q1-2013 100.0 68 %

US$ (Millions)
▸ $95M cash available for convertible Reduction
notes2 80.0 $44

2013:
60.0
▸ Donlin Gold US$30M (100% ) $16
$3
lower costs with commencement of 40.0
permitting $18 $8
$15
▸ Galore Creek C$16M (100%) 20.0
$24
expenditures significantly lower $15
-
▸ G&A $15M reduced due to 1
2012 Spending 2
2013 Budget3
reorganization
4
1) Cash and cash equivalents as of November 30, 2012 Donlin Gold G&A and Miscellaneous Interest
2) The Notes mature on May 1, 2015. The holders of the Notes have the right to require the
Company to repurchase all or part of their Notes on May 1, 2013 (“put option”) NovaCopper Galore Creek Rock Creek
3) 2013 anticipated budget expenditure disclosed on February 12, 2013
4) Assuming full repayment of US$95M in convertible notes

32

THE NOVAGOLD TEAM
Senior Industry Leaders to Bring Donlin Gold through Permitting and Beyond

MANAGEMENT
▸ Former President of Barrick Gold North America
Gregory A. Lang
▸ 35 years experience building & operating major mines
President & CEO ▸ Intimate knowledge of Donlin Gold
▸ Former EVP and General Counsel of Goldcorp
David Deisley ▸ Regional General Counsel for Barrick Gold North America
Executive Vice President and ▸ Extensive track record in project permitting, corporate social responsibility,
General Counsel mergers and acquisitions and corporate development
▸ 25 years of mining industry experience

David Ottewell ▸ Former VP and Corporate Controller of Newmont Mining Corporation
▸ 25 years of mining industry experience
Vice President and Chief ▸ Diverse experience in all facets of financial management, from mine operations
Financial Officer to executive corporate financial management of premier gold producers
Mélanie Hennessey ▸ Held variety of senior IR & corporate communication positions with Goldcorp
Vice President, Corporate Inc., New Gold Inc., and Hecla Mining Company
Communications ▸ Leading NOVAGOLD’s internal and external communications functions

Ron Rimelman ▸ 25 years of environmental experience , managing environmental impact
assessments and permitting activities world-wide
Vice President, Environment, ▸ Leadership role on mine permitting and NEPA evaluations for mine projects in
Health, Safety & Sustainability Alaska since 1993

33

WHY IS NOVAGOLD A BUY TODAY?
NG is a Very Well Managed, Strongly Sponsored Way to Gain Extraordinary Leverage to a
Rising Gold Price in a Safe Country Where you Can Keep the Fruits of that Leverage

KEY FORESEEABLE CATALYSTS
THE MICRO VIEW THE MACRO VIEW
Pending De-Risking of Donlin Gold Right Place at The Right Time
Orderly Permitting Process Jurisdictional Safety

• Uniform Transparent Step-by-Step Process • Alaska is 2nd Largest Gold Producer in the US
• Strong Support from Native Corporations • Support for Environmentally & Socially
Responsible Mining
Opportunity for Financial Optimization Strong Leverage to Gold

• Third-party Participation should Reduce Capex • Major Increase in NAV with Higher Au Price
• $1 Billion Contingency is Robust • Long-life Asset in a Stable Jurisdiction should
Yield Sustainable Investor Returns in a Secular
Bull Market
Stable Share Dynamics Long-Term Option on Gold

• Strong Shareholder Support • Projected to be the World’s Largest Gold Mine
• No Need to Raise Capital for Years • Significant Exploration Potential should Add
Decades to the Mine-Life

34

APPENDIX

35

SHARE CAPITALIZATION

Issued and Options Fully
outstanding diluted1

316.6M 16.8M 333.4M

As of January 30, 2013.
1) Fully diluted number excludes convertible notes. The Convertible notes (“Notes”) - The holders of the Notes have the right to require the Company to
repurchase all or part of their Notes on May 1, 2013 and upon certain fundamental corporate changes at a price equal to 100% of the principal amount of such
Notes plus any accrued and unpaid interest.

36

RISING GOLD DEMAND ACROSS ALL SECTORS
A Once Concentrated Global Demand is Now Diversified

Source: Bloomberg, CPM Group, LBMA, World Gold Council

37

GOLD SIGNIFICANTLY UNDERINVESTED
Investor Gold Holdings Among World Financial Assets Are Negligible

US$ Trillion
$250

200

150

100

50

0
'80 '90 '95 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11e

Bank Deposits Government Debt Securities Private Debt Securities Equity Securities Investor Gold Holdings

World Financial Assets Including Gold, May 2012
Source: McKinsey & Co., IMF, CPM Group

38

DOW JONES INDUSTRIAL AVERAGE TO GOLD PRICE RATIO SINCE 1900
A New Super Cycle in Gold is Imminent
45.0

40.0 2000; 38.42

35.0

30.0
1965; 25.93
25.0
Arithmetic Scale
Dow/Gold Ratio

20.0

1929; 15.15
15.0

10.0

5.0 2012; 7.69

1934; 2.83 1980; 1.45
-

Year

Source: Dow Jones Industrial Average (DJIA): Federal Reserve Bank of St. Louis, http://research.stlouisfed.org/fred2/series/DJIA/downloaddata?cid=32255
Historical Gold Prices: The National Mining Association (NMA), http://www.nma.org/pdf/gold/his_gold_prices.pdf
Gold prices are based on annual prices on first trading day of each year
2012 as of 09/21/2012 (last data point)

39

UNCONVENTIONAL MONETARY POLICY DRIVE INVESTMENT INTO GOLD
Four Key Factors Why One Should Invest in Gold

▸ Inflation risk:
Increase in money printing could be a catalyst for higher inflation in the future, a likely
positive for gold investment
▸ Weakened currency:
Gold is typically transacted using its US-dollar price as a reference, gold provides a
hedge against domestic currency debasement
▸ Crisis and sharp market pull backs:
During these times, gold has proven to be an effective diversifier acting as a hedge
against falls in equity and credit markets
▸ Low interest rate environment:
Households must save greater sums of money to pay obligations, causing a shift into
investments in real assets that will provide long-term security

Source: World Gold Council

40

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
▸40 full-time employees and 32 contractors
▸Strong track record for local hiring

41

PROJECT HIGHLIGHTS
Donlin Gold Slated to be a State-of-the-Art Significant Mine

Reserves: 33.9 Moz Au (~500M tons ore)1
Resources: 5.1 M&I Moz (excluding P&P) and 6.0 Inferred Moz1
Mine Life: ~27 years
Production: Year 1-5 – 1.5 Moz/year, LOM – 1.1 Moz/year
Operation: Open-pit, conventional truck & shovel
Milling: 59k short tons/day, sulfide flotation, pressure oxidation (POX),
Carbon-in-Leach recovery (CIL)
Strip ratio: ~5.5:1 = ~3B tons waste rock
Tailings: Fully lined storage facility
Power: ~150MW, supplied by 313-mile, natural-gas pipeline
Logistics: All consumables supplied by Kuskokwim River transportation
system with port near Jungjuk Creek
1) See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve and Resource Base” table with footnotes.

42

ENSURING A SMOOTH PERMITTING PROCESS
A Team with Strength, Knowledge, Experience and Understanding

Strength
• Alaska has a rigorous and clearly defined permitting process
• Good reputation and local support

Knowledge • Early project briefings and open communication with regulatory agencies
• Consistent communication with and input from local communities throughout the region
• Strive for “responsible development,” bringing benefits and positive impacts to the
region

Experience • One of the most robust environmental baseline databases
• Strong support and NEPA experience from Barrick Gold and NOVAGOLD
• Team in place that has “been there, done that” in Alaska and throughout the U.S.

Understanding • Based in Alaska, with comprehensive understanding of State’s issues and concerns
• Integration of permitting requirements in formulating project design concepts
• Deep roots in the State and community with more than 16 years on the ground at Donlin
Gold

43

SITE LAYOUT
The Property Lends Itself Well to Compact Project Layout

44

DONLIN GOLD TIMELINE
Small Percentage Of Time Invested Considering Mine Life Measured In Decades

Exploration, Key Permitting Construction Production
Responsibilities
Environmental Highlights:
State: Air, Water, ▸ ~1.5 million
Studies, ▸ Two open pits
Dam Safety, ounces/year
Engineering, ▸ Pressure oxidation plant for first 5 years,
Waste Management,
Feasibility Reclamation Plan ▸ Milling circuit followed by
Studies Approval, Rights of Way, ▸ 27-mile road ▸ ~1 million
Cultural Resources ▸ 5,000-foot runway ounces/year
Federal: Wetlands, ▸ Two port facilities
Rights of Way, ▸ 600-bed permanent camp 27 year
Wildlife Consultations, ▸ 2,500-bed construction camp mine life
Environmental Impact
▸ ~40-million gallon diesel storage
Statement

45

DONLIN GOLD PERMITTING PROCESS
Clear Steps Outlined and Good Working Relationship at State & Federal Levels

Permitting Process is Approximately 3-4 years

State Federal

AK Department of AK Department of US Army Corps Bureau of Land
Agencies Environmental Natural Resources of Engineers Management

AK Department of Fish & Game US Fish and US Environmental
Wildlife Service Protection Agency
Reclamation Air Quality
National Marine Fisheries Service
Permits/Approvals Waste
Pipeline
Management Right of Way Wetlands

Fish Habitat Water Discharge Essential Fish Habitat

Marine Mammal Protection

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 $1,700/oz $2,000/oz $2,500/oz
Base Case

Average annual $M 670 950 1,500 1,785 2,185
after-tax cash flow
(first full five years)
Average annual $M 350 500 815 990 1,275
after-tax cash flow (LOM)
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
Payback period Years 19.1 9.2 5.3 4.4 3.5

Source: Updated Feasibility Study. 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; $4,581 m @ $1,700 gold; $6,722 m @ $2,000 gold; and $10,243 m @ $2,500 gold. Project development costs prior to that date
are treated as sunk costs. See “Cautionary Note Concerning Reserve & Resource Estimates” and “Reserve & Resource Base” with footnotes in the appendix.

1) NPVs and IRRs as at January 1, 2014. Project development costs prior to that date are treated as sunk costs.
47

NOVAGOLD BOARD OF DIRECTORS
Dr. Thomas S. Kaplan Chairman and CEO of The Electrum Group LLC, a privately held natural resources
Chairman investor that controls a diversified portfolio of precious and base metals assets
Former Chief Legal Officer and Corporate Secretary with Franco-Nevada, transforming an
Sharon Dowdall
industry pioneer into one of the most successful precious metals enterprises in the world
Publishes a monthly investment newsletter entitled The Gloom, Boom & Doom
Dr. Marc Faber
Report and is the author of several book
Executive VP and CFO of Kinross Gold Corporation, former CFO of Capstone Mining
Tony Giardini
Corp.
COO and Director of Sunward Resources, former Senior Vice President and Chief
Gil Leathley
Operating Officer of the Company
President of The Electrum Group LLC, former VP of Homestake Mining and International
Igor Levental
Corona Corp.

Kalidas Madhavpeddi 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

Former President and Chief Executive Officer of Miramar Mining Corporation, which in
Anthony P. Walsh
2007 was sold to Newmont Mining Company.

48

DONLIN GOLD MANAGEMENT TEAM
30+ years mining industry experience in exploration, mine geology, operations management, project management
Stanley Foo and permitting; 12 years mine operations experience in NV including superintendent roles at Cortez and Bald;
President/General
15 years in Alaska in project management and permitting; Previous Project Manager roles with Donlin 1997-99,
Manager
2005-2007, served on DGLLC board 2008-2010.

James Fueg Led Donlin Gold’s recent feasibility studies and coordinates all engineering and technical work for project;
Study Manager 20+ years experience in mining, exploration and environmental science; 16 years in Alaska; on Donlin since 2004.

30 years experience in mining industry; 16 years in Alaska, with Donlin and TeckCominco (Pogo and Red Dog);
Bill Bieber Recipient of Barrick’s long-term CSR achievement award for his work at Donlin in workforce development and
Operations Manager
community relations.

Robert Nick Enos Leads permitting and environmental management for project; primary contact for reg. agencies; 20 years
Environmental and experience in Alaska in geology, environmental science and permitting management; Previous experience
Permitting Manager includes Greens Creek, Calista Corp., as environmental/permitting consultant; Joined Donlin in 2005.

Leads Donlin Gold’s community affairs, communications, government relations and corporate social responsibility
Kurt Parkan functions; Nearly 30 years public affairs experience in Alaska; Previous roles: External Affairs Director of Nature
External Affairs Conservancy of Alaska, Deputy Commissioner for Alaska Department of Transportation and Public Facilities,
Manager Special Assistant to the Governor, Legislative Aide and as staff for Alaska House of Representatives Finance
Committee.

22 years human resources experience in the mining industry including 17 years in Alaska; Served in various
Meg Day senior management positions in Alaska, Utah and Washington and has been involved in the start up of several
Human Resources mines. Serves on Alaska Miners Association HR Committee, Society of HR Management and Advisory Board
Manager member of University of Alaska.

Jan Halstead 25+ years accounting and financial analysis experience in construction, investment, telecommunications;
Administrative and Responsible for growth and development of Accounting, Administration, Purchasing and Contract functions for
Finance Manager Donlin Gold LLC.

49

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