NOVAGOLD Resources Inc. (NYSE American: NG) is a precious metals company focused on advancing the Donlin Gold project, one of the largest and highest-grade undeveloped gold deposits in the world, located in Alaska. With a steadfast commitment to responsible development, NOVAGOLD is poised to capitalize on the growing demand for high-quality gold assets in safe jurisdictions.

Donlin Gold: A Standout in the Industry

The Donlin Gold project boasts an impressive resource of nearly 40 million ounces of gold with an average grade of over 2 grams per tonne, more than double the industry average. Projected to have a mine life of almost three decades based on current resources, Donlin Gold is set to become one of the top gold producers in the industry, with the potential to generate around 1 million ounces of gold annually at low costs.

Situated on privately designated land in Alaska, a world-leading mining jurisdiction, Donlin Gold benefits from a stable regulatory environment and strong support from the local communities. NOVAGOLD's long-standing partnerships with Calista Corporation and The Kuskokwim Corporation, the Alaska Native Corporations that own the mineral and surface rights, have been instrumental in strengthening the project's social license to operate.

Advancing Donlin Gold: A Methodical Approach

Since NOVAGOLD's restructuring over a decade ago, the company's primary objective has been to advance the development of the Donlin Gold project. The next critical step is to update the feasibility study, with the goal of positioning the project favorably for a construction decision when market conditions are right.

In the second quarter of 2024, NOVAGOLD and its partner Barrick Gold made significant progress on the Donlin Gold project. Key activities included ongoing resource modeling, metallurgical test work, groundwater and surface water modeling, and the progression of regional support infrastructure planning. The company also continued its robust stakeholder engagement efforts, signing an additional Shared Value Statement with a local community and holding the third Subsistence Community Advisory Committee meeting.

Permitting Milestones and Bipartisan Support

Donlin Gold is a federally permitted project, having secured all the necessary federal permits, including the crucial 404 permit from the U.S. Army Corps of Engineers and the right-of-way lease from the Bureau of Land Management. The project also holds the majority of the required state permits, with the only significant outstanding permit being the Dam Safety Certification, which is currently in the application process.

The permitting process has been supported by bipartisan efforts, with U.S. Senators Lisa Murkowski and Dan Sullivan, and U.S. Representative Mary Peltola, submitting a joint amicus brief in federal court, highlighting Donlin Gold as one of Alaska's most important and necessary economic development projects. This strong political support, combined with the project's location on private land designated for mining activities, underscores the stability of the regulatory environment in which Donlin Gold operates.

Financials

In the second quarter of 2024, NOVAGOLD reported a net loss of $13.7 million, a decrease of $0.9 million from the prior-year quarter. This was primarily due to lower Donlin Gold project costs, partially offset by increased interest expense on the promissory note and higher general and administrative expenses.

For the full year 2024, NOVAGOLD expects to spend approximately $31 million, including $17 million for corporate general and administrative costs and $14 million for the Donlin Gold project. As of May 31, 2024, the company had a strong financial position, with cash and cash equivalents of $52.6 million and term deposits of $60 million.

Outlook

NOVAGOLD's unwavering commitment to the responsible development of the Donlin Gold project has positioned the company as a prime investment opportunity in the gold mining industry. With its exceptional resource, long mine life, and low-cost production profile, Donlin Gold stands out as a Tier-1 asset in a Tier-1 jurisdiction.

As the global gold industry faces a scarcity of high-quality development-stage projects, Donlin Gold's scale, grade, and longevity make it an increasingly vital asset. The company's methodical approach to advancing the project, coupled with its strong partnerships and bipartisan support, underscores NOVAGOLD's ability to navigate the complex permitting landscape and deliver substantial value for its shareholders.

Looking ahead, NOVAGOLD remains focused on updating the Donlin Gold feasibility study, which will be a critical step in positioning the project for a construction decision when market conditions are favorable. With its robust financial position and the continued support of its stakeholders, NOVAGOLD is well-positioned to unlock the full potential of this exceptional asset and create long-term value for its shareholders.

Financial Overview

For the fiscal year ended November 30, 2023, NOVAGOLD reported an annual net loss of $46.6 million, with no revenue generated. The company's annual operating cash flow was -$7.8 million, and its annual free cash flow was -$7.2 million.

In the second quarter of 2024, NOVAGOLD reported a net loss of $13.7 million, a decrease of $0.9 million from the prior-year quarter. This was primarily due to lower Donlin Gold project costs, partially offset by increased interest expense on the promissory note and higher general and administrative expenses.

For the full year 2024, NOVAGOLD expects to spend approximately $31 million, including $17 million for corporate general and administrative costs and $14 million for the Donlin Gold project.

As of May 31, 2024, the company had a strong financial position, with cash and cash equivalents of $52.6 million and term deposits of $60 million.

Conclusion

NOVAGOLD's unwavering focus on advancing the Donlin Gold project, a Tier-1 asset in a Tier-1 jurisdiction, positions the company as a compelling investment opportunity in the gold mining industry. With its exceptional resource, long mine life, and low-cost production profile, Donlin Gold stands out as a premier development-stage project poised to capitalize on the growing demand for high-quality gold assets.

NOVAGOLD's methodical approach to project development, strong partnerships, and bipartisan support from key stakeholders, including the local communities and government agencies, underscores the company's ability to navigate the complex permitting landscape and deliver substantial value for its shareholders. As the company continues to update the Donlin Gold feasibility study, NOVAGOLD remains well-positioned to unlock the full potential of this exceptional asset and create long-term value for its investors.