Executive Summary / Key Takeaways

• NovaGold's strategic partnership with Paulson Advisers, increasing its Donlin Gold stake to 60%, has resolved past impasses and created a unified vision to accelerate the project's development.
• The Donlin Gold project is a Tier 1 asset in Alaska, boasting 40 million ounces at an exceptional 2.25 g/t grade, positioning it to become the largest single gold mine in the United States with a projected 1.4 million ounces annually for its first decade.
• A Bankable Feasibility Study (BFS) contract is expected to be awarded by year-end 2025, with commercial production targeted around 2031, marking a clear path forward after years of stagnation.
• Despite current development-stage losses and a recent non-cash warrant charge, NovaGold maintains a robust treasury of $125.2 million, providing liquidity for near-term activities, with diverse financing options anticipated for full project development.
• Donlin Gold's unique combination of scale, high-grade refractory ore processed by proven autoclave technology, and its location in a geopolitically stable jurisdiction offers compelling leverage to the ongoing gold bull market for long-term investors.

A New Dawn for America's Gold Frontier

NovaGold Resources Inc. stands at a pivotal juncture, singularly focused on advancing its principal asset, the Donlin Gold project in Alaska. In an era defined by a robust gold bull market and a scarcity of high-quality assets in secure jurisdictions, Donlin Gold emerges as a foundational strength. The company's recent transformative partnership with Paulson Advisers LLC has not only reshaped its strategic trajectory but also ignited a renewed ambition to develop what is poised to become the largest single gold mine in the United States. This shift from past operational impasses to a perfectly aligned vision underscores a compelling investment narrative.

A History Forged in Gold and Resilience

NovaGold's journey, dating back to its incorporation in 1984, has been marked by a steadfast commitment to gold exploration and development. A significant turning point arrived on December 31, 2008, when Dr. Thomas Kaplan, now Chairman, and Greg Lang, President and CEO, took the helm, driven by a conviction that gold was entering a major bull market and Donlin offered unparalleled leverage. Lang, a 30-year veteran of Barrick Gold, brought extensive mine development expertise, complemented by Richard Williams, VP Engineering and COO, who has a proven track record in bringing major projects like Pueblo Viejo into production.

The company's path, however, was not without its challenges. A previous co-ownership with Barrick Gold Corporation led to what Dr. Kaplan described as an "impasse," causing NovaGold to be "comatose" and hindering progress. This changed dramatically on June 3, 2025, with the completion of a "catalytic transaction" where NovaGold and Paulson Advisers acquired Barrick's 50% interest in Donlin Gold for $1 billion. This strategic move increased NovaGold's economic interest to 60%, with Paulson holding 40%, creating a "perfect alignment" that is now accelerating the project's advancement.

Donlin Gold: An Alaskan Colossus with Technological Acumen

The Donlin Gold project is a truly world-class asset, boasting an impressive 40 million ounces of gold at an average grade of 2.25 grams per tonne. This grade is more than double the global industry average, a critical differentiator that underpins the project's economic viability. Donlin is projected to have a mine life of nearly three decades, with an average annual production exceeding one million ounces. Crucially, the first ten years of operation are anticipated to yield an even higher average of 1.4 million ounces per year, with the first five years potentially reaching 1.5 million ounces annually. This scale of production is expected to position Donlin as the largest gold mine in the United States.

The ore body at Donlin is primarily refractory, necessitating a specialized processing approach. The core technology involves flotation to concentrate the ore, followed by treatment in an autoclave, and then subsequent leaching to recover the gold. This flow sheet is a "very common" and "reliable" technology within the mining industry, a fact reinforced by the management team's extensive experience, including "thirty years of experience working with autoclaves." The tangible benefit of this proven technology is its ability to efficiently extract gold from complex ore, directly contributing to the project's "exceptionally low cash costs" due to the high-grade nature of the deposit. In 2024, metallurgical test work and a pilot plant in Ontario, Canada, were substantially completed to confirm and optimize this proposed flow sheet, demonstrating a commitment to continuous technological refinement and operational efficiency.

Beyond the known resource, Donlin Gold offers extraordinary exploration potential. Only 5% of the vast district has been explored, with the current 40 million ounces concentrated within just three kilometers of an eight-kilometer mineralized belt. Management firmly believes that "the next Donlin will be found at Donlin," suggesting the potential for tens of millions of additional ounces through a planned district-wide exploration program. This significant upside further enhances the project's long-term value proposition for investors.

Competitive Edge in a Robust Gold Market

NovaGold's competitive standing is significantly bolstered by Donlin Gold's intrinsic qualities and its strategic location. The project's grade of 2.25 g/t is not only double the industry average but also substantially higher than many other development projects. For instance, a recently successful mine in British Columbia operates at one-third of Donlin's grade, highlighting Donlin's potential for superior profitability. Furthermore, Donlin's projected production profile of 1.4 million ounces per year for its initial decade is more than double the average output of other developing gold projects, setting it apart in terms of scale and impact.

The jurisdictional safety of Alaska is a paramount competitive advantage. Ranked 13th globally and one of only 13 jurisdictions to achieve a "AA rating" in the World Risk Report, Alaska offers a stable and supportive environment for mining. Donlin Gold is situated on private land owned by two Alaska Native Corporations, Calista and The Kuskokwim Corporation (TKC), with whom NovaGold has "life of mine agreements." This unique partnership provides a strong social license and local support, a critical differentiator in an industry often fraught with community opposition. Dr. Kaplan has underscored the increasing importance of "jurisdictional safety," contrasting Alaska's stability with the risks of nationalization observed in less secure regions.

While NovaGold, as a development-stage company, currently lacks the diversified production and immediate cash flow of larger competitors like Barrick Gold (GOLD), Newmont (NEM), or Kinross Gold (KGC), its focused strategy on a single, high-potential asset in a safe jurisdiction offers a distinct value proposition. The high barriers to entry in gold mining, including substantial capital requirements and stringent regulatory approvals, also serve as a moat, protecting Donlin's future market position once operational.

Operational Momentum and Strategic Roadmap

The new partnership with Paulson Advisers has injected significant momentum into Donlin Gold's development. The 2025 drill program, which saw 18,454 meters completed shortly after the third quarter, confirmed consistent mineralization across multiple zones, with standout intervals reaching up to 23.49 g/t gold. This drilling focused on refining mine planning assumptions and converting inferred resources, directly feeding into the next critical milestone: the Bankable Feasibility Study (BFS).

A Request for Proposals (RFP) for the BFS has been issued to top-tier engineering firms, with a contract expected to be awarded and work commencing before year-end 2025. This comprehensive study is anticipated to take approximately two years and cost between $80 million and $100 million. Following the BFS, NovaGold hopes to begin construction in 2027, targeting commercial production around 2031. Permitting continues to advance, with federal permits already secured and state permits, particularly for the tailings dam, well on track for issuance in 2026 or early 2027. Legal challenges to permits have consistently seen favorable rulings, with the federal court's remand on a tailings storage facility analysis being narrow in scope and not vacating existing permits.

NovaGold also maintains a strong commitment to environmental, social, and governance (ESG) principles. This includes active community engagement through 19 Shared Value Statements, environmental restoration efforts at historically impacted sites like Snow Gulch, and hazardous waste removal programs in the Yukon-Kuskokwim region. These initiatives reinforce the project's social license and long-term sustainability.

Financial Performance and Liquidity for Future Growth

As a development-stage company, NovaGold does not generate revenue and reports net losses, which are typical for its operational phase. For the third quarter of 2025, the net loss increased by $4.9 million to $15.6 million, primarily due to higher field expenses at Donlin Gold and increased general and administrative costs. The net loss for the first nine months of 2025 totaled $79.0 million, significantly impacted by a $39.6 million non-cash, non-recurring charge related to warrants issued under a backstop commitment agreement. Donlin Gold expenses were higher due to NovaGold's increased 60% funding obligation and intensified site activities in 2025.

To fund its portion of the Donlin Gold acquisition, NovaGold successfully completed a public equity offering and a concurrent private placement in May 2025, raising $270.8 million in net proceeds. These funds were primarily used for the $210.1 million payment for the additional 10% interest in Donlin Gold, with an additional $9.1 million in transaction costs also capitalized. As of August 31, 2025, NovaGold maintains a robust treasury with $125.2 million in cash and term deposits, which management deems sufficient to cover anticipated Donlin Gold funding and corporate general and administrative costs for at least the next two and a half years.

Looking ahead, NovaGold's 2025 guidance includes a $43 million budget for Donlin Gold (on a 100% basis), with NovaGold's pro-rata share increasing to $24 million. Corporate general and administrative costs are projected to be $18 million for the year. While the capital required for the BFS and subsequent construction is substantial, Dr. Kaplan expressed strong confidence in future financing, noting "tremendous goodwill" and access to large capital checks from investors interested in a strategic U.S. gold asset. The company also holds a promissory note payable to Barrick of $162.6 million, with an option to prepay it for $100 million by December 3, 2026.

Conclusion

NovaGold Resources Inc. is poised for a transformative period, with the Donlin Gold project now on an accelerated path towards becoming America's largest gold mine. The strategic partnership with Paulson Advisers has unlocked significant value, aligning the company's vision with the robust fundamentals of a major gold bull market. Donlin's exceptional grade, immense scale, and location in a geopolitically stable Alaska, coupled with proven processing technology and a clear development roadmap, present a compelling investment thesis. While the company navigates the capital-intensive development phase and ongoing litigation, its strong liquidity, experienced management, and unwavering stakeholder support underscore its potential. For discerning investors seeking substantial leverage to gold in a secure jurisdiction, NovaGold offers a unique opportunity for long-term value creation as it progresses towards commercial production and unlocks the full potential of its Alaskan gold giant.