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NOVAGOLD

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September 17, 2024 at 1:30 PM (MDT)|Broadmoor Hotel & Resort

Greg Lang

President & CEO

Greg is President and Chief Executive Officer of NOVAGOLD and has been since January 2012. Mr. Lang has more than 35 years of diverse experience in mine operations, project development, and evaluations. Prior to joining, he was President of Barrick Gold North America and Managing Director of Barrick Gold Australia. Mr. Lang has held progressively responsible operating and project development positions over his career at Homestake Mining Company and International Corona Corporation, both of which are now part of Barrick. He holds a Bachelor of Science in Mining Engineering from University of Missouri-Rolla and is a Graduate of the Stanford University Executive Program.

This is an automatically generated transcript. Denver Gold Group cannot accept responsibility for mistakes, errors, omissions, or any action taken in reliance thereon. Use of this transcript is governed by Denver Gold Group’s Terms of Use.

Good afternoon, everyone. Thank you for taking a few minutes to get an update on the Nova Gold story. As I'm sure everyone is aware and is quite customary. Our presentation does contain forward-looking statements. And you know, this information is available on our website. If you have the curiosity to review it in detail, why, why would someone look at an investment in Novagold, you know, Nova Gold is you know, it's a very easy company to understand. You know, we own 50% of the Donlin Gold Project up in Alaska. Our partner in this undertaking is Barack, one of the largest gold producers in the industry. You know, many companies in our space are looking for partners. You know, we're fortunate, we have a partner and we have a well heeled partner who's you know, got assets all over the world. Yeah, some of the attributes of the Don project that really make it unique are listed on this slide. And what is the production profile if it was built and in production? In accordance with the feasibility study, it average over a million ounces of gold production per year making it one of the largest gold producers out there. You know, it's high grade deposits. You know, we've got two and a quarter grams which is twice the industry average, you know, jurisdictional issues, political tensions are running rampant in the natural resource sector, particularly in the gold industry. You know, we're fortunate that we're up in Alaska and jurisdictional safety is one of the foundational pillars of the investment thesis in this company. You know, partnerships. In addition to Berwick, the underlying owners of Donlin are two Alaska native corporations, Jalisa owns the mineral estate and TKC owns the surface rights. We have life of mine agreements in place with both of these companies permitting. You know, we're substantially complete on our permitting. You know, we've got a team of people who understand how to move these big assets forward, you know, and at 40 million ounces, we've got a substantial endowment, but that's only the beginning and I'll touch on the exploration potential. Later in my presentation, this slide depicts how the Donlin gold project ranks with the other projects that people are advancing throughout the industry. KSM just presented before I did and they're also a big asset. But beyond KSM and Donly, which would be the largest, the output of the other projects drops off substantially. And the average of those is probably somewhere well under 400,000 ounces a year, your grade, your grade has been steadily declining throughout the industry. Average grades now are under a gram. You know, we're, we're better than twice the industry average at two and a quarter grams. You know, a lot of the mines that have come on stream in years have grades of less than a gram. So it's the, the grade that really separates Donlan from the others. In essence, you get twice the amount of gold for essentially the same amount of expense. Yeah, Alaska. You know, we've been up in Alaska for many years now. We're comfortable doing business up there. It's the second largest gold producing state in the US. And many companies Tech Kross Core Heckler have been up there and operating profitably for many years. It's one of the rated one of the safest mining jurisdictions in the world. As I mentioned earlier, we have great relationships and great partners with the Alaska Native corporations, Chisa and TKC. This ownership structure came about with the Alaska Native Claims Settlement Act over 50 years ago when the Federal government and the state of Alaska needed to resolve the overlapping land claims to open up the state to build the Transalaska pipeline which carries petroleum from the north slope. Certain assets were transferred to the native corporations for their economic self determination. The land that donly sits on was always known to have mineral potential and it was designated for mining activities. In essence, Jalisa and TKC have a treaty with the US government that allows mining activities to take place on their land you know, permitting is, I think we all are aware, permitting in the United States is an arduous, transparent and fairly expensive and time consuming process. We spent over six years and 100 and $50 million completing our permits. A few years ago, we received a record of decision from the Army Corps of Engineers and the Bureau of Land Management. You know, that record of decision was the first time the two federal agencies issued a joint record of decision. And I think that really speaks to the very cooper manner in which we approached the permitting at Donlin. Anybody that says you can fast track permitting is just particularly in the United States. It simply can't be done. You have to go into it eyes wide open knowing that it's going to take you years and you want the process to be very transparent. And that is how we've approached our permitting and we were successful. We've also achieved most of the state permits that we need to begin construction, air quality water discharge and so on. The only remaining permit of any consequence is for our Tailings Dam. And we deliberately left that to the end because one, it was not on the critical path. You know, the 404 wetlands permit authorizes us to build the Tailings Dam. But in Alaska, structures like that are administered by the state and the approval process for the state requires final construction and final engineer drawings. And that was, you know, that's a fairly expensive undertaking. A few years ago, we did the geotechnical drilling to support the design and we have recently submitted our preliminary design package to the state and it is under review. So we are in essence permitted project. And the schedule for what happens next lies in the hands of the owners not waiting on any government work. You know, and I'll just touch on that lightly. You know, we've got an experienced team, a longtime Barrack employee, Richard Williams, our vice president of engineering was the lead for Barrack when they built the Pueblo Viejo mine. He's one of the few people out there in the industry that have actually built a multibillion dollar gold mine. You know, we're lucky to have him on the team and when the time is right, I'm sure he will replicate that success with the construction of Donlin. This is always a slide that's it's really intriguing to me. You know, when I look at Don and we've got 40 million ounces defined and even more if you include the inferred and that, you know, that's a substantial endowment in anybody's measure. But when you look at that deposit is contained, those 40 million ounces are in the Acma and Lewis deposits, which are shown here on this slide, you know, those deposits only occupy three kilometers of an eight kilometer gold bearing system. We also know that deposits are open ended a long strike and at depth, you know, we've got gold bearing drill holes all up and down the trend from snow quartz dome, you know, and, and comparable grades to what we're seeing at Donlin. You know, when the time is right, we will resume exploration activities at Donlin. And, you know, we certainly got the real estate to substantially increase the endowment if not double it. And more importantly, the area that's depicted on this slide represents about 5% of our extensive landholdings up there. And most of these lands are also held by the native corporations. So we are well positioned to resume exploration when the time is right. You know, this is an an an interesting slide because when we first started presenting the attributes of Don, you know, when I joined the company 12 years ago and Doctor Kaplan became chairman, we took the company and we restructured it. We slimmed it down, made it into a pure gold play focused on the Don and Creek asset. That was a deliberate act on our part. We spun off some copper exploration plays. We had a project that we sold to Newmont for $200 million. So we took the company slimmed it down. We did an equity raise in 2012. We raised $330 million. We have not been back to the equity markets in almost 13 years and that's virtually unheard of for a development stage company like ours. But setting that aside, these are the times we've been waiting for, you know, we've got an asset in a safe jurisdiction. We're in a rising gold price environment and the leverage that this project brings both to Nova gold and to the underlying owners is tremendous. Gold is bouncing around record highs at $2500 plus. And I think that certainly bodes well for projects like Donlin, we always knew that this was not a project for $1000 an ounce. And we never believed that $1000 an ounce was the future gold price at current returns or current prices. The project has stellar returns. So, so where are we at? You know, this defines the history of the project, you know, Nova Gold in its earlier incarnation was a junior explorer and, you know, exploring all over Canada, the US and, you know, mainly in the Americas and, you know, they had got on to the Donlin project they earned into it when Plaster Dome was the underlying owner and developed, you know, a large resource there. Yeah, along the way, Barack many years ago had a failed hostile takeover attempt and all of this has been steadily moving the project forward. In 2012, the owners endorsed the feasibility study and set about permitting the project and we did complete that work, you know, and we're, you know, roughly 20 years into this. And if you look around the industry, now that's about what it takes to advance a large scale project. You, once you find it, you've got to prove it up, you've got to do the environmental studies, the technical due diligence, you know, these are time-consuming activities, especially for a multibillion dollar asset on the scale of the Don and gold project. You know, this year has been you know, a lot of activity at, at Don and we've got a, a budget of just under $30 million which is, you know, still pretty substantial in prior years. We were spending more than that as we were, had some major drill campaigns. But, you know, we've been at that rate now for a while, you know, some of the work that's been underway this year is we've got a pilot scale metallurgical plant testing underway in Canada. And this, it was really intended to validate the assumptions we've used in the feasibility study and it has done that, you know, and this is really a foundational piece when it comes to updating the new feasibility study. We'll be glad we, we have this work in hand. We've also, as I mentioned earlier, are wrapping up the permits and have submitted the dam safety certifications. And we're pursuing that. We're also looking at our options on how to fuel and power the Doland mine site. There's a couple of very viable options ahead of us, you know, two years ago, three years ago, we had big drill programs with Barrack and now we're taking that drill data and incorporating it into our geologic model. We're very pleased with the results and we're, you know, expect, you'll be guiding on that in the coming months, but that's moving along well as well as other work out on the field to update our understanding of the hydrology and really feasibility level work to prepare this project for when that decision is made. Yeah. Other highlights throughout the second quarter, you know, that our relationships with the local communities are strong and it's something we never ever take for granted. You know, we've had shared valued statements in place with over 17 villages and they're all supportive of what we're trying to do up in Alaska. You know, our Don, the project is in a very impoverished part of the state of Alaska, Crooked Creek, the nearest community to the project site, village of about 100 and 50 people, most of the homes don't have running water. So these are very impoverished people and there are no economic opportunities on the horizon for them. You know, they really want to see this B go forward and that's the, the project that we're advancing and we continue to work with them. We do not take our social license for granted and we've worked in various community programs, job skills training, you know, doing everything we can to prepare the local population for a meaningful employment at the Don and Gold mine. You know, we're in the United States. You know, we're a litigious society for many years. Permitting is just the first step. Once you are granted your permits, you then have to defend them in court. And that's, there's a group out there earth justice that's challenged four of our permits. You know, we expect that this would happen. It always happens in the United States and every step of the way we have prevailed in the court system. And I expect that we'll continue and that, you know, and it's interesting the, when people challenge the permits, they don't go after the owner companies, they go after the agencies that have granted you those permits. And what we're seeing in the Department of Justice who represents the Army Corps of Engineers. The Corps of Engineers is very proud of the depth and the detail of the analysis they did on the Don and Gold project and they are vigorously defending that work. The other side of our involvement in Washington DC is with our native partners. You know, they have been staunch advocates for the project for many, many years. You know, when we are, when we're active in Washington DC, we let the native corporations really be the tip of the spear because they have certainly a lot more sway with the government than two Canadian mining companies. It's just the reality and they're very passionate about seeing this project go forward our sustainability report. We've published this now for a couple of years. It's out on, on our web page. I'm proud to say that the Donlin project has worked, I think, approaching 15 years without a lost time accident at the site and no significant environmental issues. So we're very proud of that record. You know, we continue to maintain a strong presence socially in the region. You know, as far as governance on our board, you know, our board is well diversified with strong div minority and women represented on our board. Frankly, we've got a great board of directors at Nova Gold, all Industry veterans. Yeah, coming up, one activity, our former CFO David Otwell, who was a 13 year veteran of the company. Prior to that, he was a vice president, Newmont retired a few months ago and Peter Adamec joined us. He was a vice president, Hud Bay Mining company. So we continue to attract good people, good assets, attract good people. And we've tran that transition went, went quite smoothly. You know, we're committed to when the time is right, updating our feasibility study. We look at that as the next logical step in the evolution of the Don and Gold deposit. You know, we're working. actually this coming weekend, I'm going up to Alaska to meet with Doctor Bristow and his team at the Don site. And it's at this meeting that we usually lay out the programs and the budgets for the upcoming year. You know, our view is, you know, gold is at record high prices. We've got our permits in hand. You know, our view is it's time to begin the necessary work to take this project forward ultimately to a construction decision. Yeah, the company is strong. As I mentioned earlier, we have not had to raise equity in over thir almost 13 years. We even at year end, we will have a treasury of in excess of $100 million and that will support the ongoing activities at Novagold for many years. Finally, we've got you know, very tightly held company. About two thirds of our shareholders represent about two thirds of our shares are in the top 10 shareholders. You know, and many of these shareholders have been with us for a long, long time. Paulson first Eagle Fidelity that's mainly will doffs contra fund. All of these people look at Novagold for what it represents and that is we've got an un expiring warrant on future gold production and they trust us to do the right thing. We've always been careful with our money, every commitment we ever made on how we were going to take this project forward, we have fulfilled and we will continue to do that as we go forward. Yeah. Thank you for your time. I see. I have about a minute left. Carrie. OK, great. Thank you for that, Greg. Is there a question in the audience? If you do just put your hand up? OK, back here in the back, just wait for the mic. Yeah. Why would somebody? So there's not a question? OK, Andrew, I have a quick one for you. Just, just call out the question. Maybe Greg can repeat it and then we don't have to wait for the mic. No, always. Yeah. Yeah. Well, the question that Andrew asked was what I think the essence of the question is, what gold price do you think Barrack needs to go forward? Precisely? Well, gold was about half the price. It is. Now when Barrack came into the mix and in fact, in just the last few months, it's gone up pretty dramatically. So I, I think frankly, I think we're there, hopefully with our upcoming workshops, we can crystallize the path forward for a feasibility study. You know, Barrack has a lot on their plate with expansions at La Moana and record and so on. But gold prices are strong. The feasibility study is not a staggering amount of money. It's something both companies can easily absorb. So we look forward to productive discussions with Barrack in this coming weekend. Thank you. OK. That's great. That's all the time we have for questions


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