January 5, 2010 - Vancouver, British Columbia - NovaGold Resources Inc. (NYSE-AMEX, TSX: NG) has appointed Mr. Gil Leathley as Senior Advisor to the President. Mr. Leathley brings a tremendous breadth of mining experience to this position, and will advise NovaGold on mining, technical and operation matters related to the Company’s advanced projects.
With more than 50 years of mining experience, Mr. Le athley has been involved in all aspects of mine construction and operations as well as evaluation of exploration properties and potential acquisitions.
Mr. Leathley has also assisted with financial oversight and offers expertise on engagement with investors, analysts and local communities. Originally from Scot land, Mr. Leathley trained as a Mine Surveyor and Industrial Engineer with the Scottish National Coal Board, working his way through coal and bauxite mines and eventually to gold and copper mining in 1975. Mr. Leathley retired in 2000 as Senior Vice President and Chief Operating Officer of Home stake Mining, and has since worked as a consultant for a number of well-respected Canadian mining companies.
“Mr. Leathley is one of the best mine builders in our industry,” said Rick Van Nieuwenhuyse, President & CEO of NovaGold. “He has an unparalleled record of building and operating mines around the world, including Golden Giant in Ontario, Eskay Creek in British Columbia and Ruby Hill in Nevada. Mr. Leathley’s pragmatic advice and expertise will be invaluable in de veloping what we believe to be several of the most significant mining projects of this century.”
Projects Update
NovaGold continues to make progress at all of its key projects. At its 50%-owned Donlin Creek project in northwest Alaska, NovaGold and its partner Barrick Go ld are assessing optimization scenarios with the goal of reducing power and proce ssing costs and further improving th e project economics. Donlin Creek contains one of the largest gold deposits in the world with 29.3 million ounces of gold in proven and probable reserves and a further 6 million ounces of gold in measured and indicated resources. Based on the 2009 feasibility study, during the first five full years of production Donlin Creek is expected to average 1.6 million ounces of gold annually with an averag e total cash cost of US$394/oz, which places Donlin Creek in the lower quartile for global industry total cash costs.
At its 50%-owned Galore Creek project in northern British Columbia, NovaGold and Teck are considering a more aggressive program for 2010 to advance the pro ject toward a construction decision. The Galore Creek deposit contains 8.9 billion po unds of copper, 7.3 million ounces of gold and 123 million ounces of silver in measured and indicated resources, making it one of the largest undeveloped copper-gold deposits in North America. The Provincial and Federal govern ments recently announced support to build a power line along Hwy 37 to Bob Quinn, which is the starting point of the Galore Creek access road. Given the continued strength of the copper and gold markets, No vaGold expects to release a new mine plan for the project in early 2010 that will include updated econ omics using higher copper and gold prices and an optimized project design.
At its 100% owned Ambler project in northern Alas ka, NovaGold will continue to work with local communities to support the construc tion of necessary project infrastructure in the region, including discussions with the Alaska Department of Transportation, NANA Corporation, the Northwest Arctic Borough and the Upper Kobuk River Vi llages with regard to building the Northwest Transportation Access Corridor. NovaGold has appointed a project team to plan exploration activities, advance environmental baseline studies and conduct engineering and technica l studies at the Ambler pr oject with the goal of gaining a better understanding of the true size and pote ntial of the district as well as the continuity and mineability of other deposits in the Ambler mineralized belt. The most advanced deposit on the property is Arctic, with a measured and indicate d resource base of 1.5 billion pounds of copper, 2.2 billion pounds of zinc, 450,000 ounces of gold and 32 million ounces of silver, and additional inferred resources of NYSE-AMEX, TSX Symbol: NG News Release
936 million pounds of copper, 1.3 billi on pounds of zinc, 260,000 ounces of gold and 19 million ounces of silver.
At its 100%-owned Rock Creek project in northwest Alaska, NovaGold has made significant improvements to water management, plant design and the overall condition of the property. In 2010, the Company plans to build upon these achievements so that an optimum decision can be made for the future of this project.
“We hold one of the best pipelines of gold and base metals mining pr ojects in the Western world,” added Mr. Van Nieuwenhuyse. “With our share of the world-cl ass Donlin Creek and Galore Creek projects, plus Ambler and Rock Creek, NovaGold’s resource base to tals 24.2 million ounces of measured and indicated gold resources (which includes 15.2 million ounces of proven and probable gold reserves) and 6 billion pounds of measured and indicated copper resources. This reserve/resource base rivals that of many midtier producers.
“We believe the true potential of these properties is materially greater than currently identified. Significant exploration potential remains at all of our projects, which are located in large mineralized districts containing numerous deposits. One of NovaGold’s key strengths is its ability to add value through exploration success. Our exploration team tripled the size of both the Donlin Creek and Galore Creek deposits through focused exploration campaigns. We will now focus our exploration efforts at the Ambler copper-zinc-gold-silver deposit with the objective of bringing valu e to our investors by advancing another world-class deposit.”
Kevin Francis, P.Geo., Vice Presiden t Technical Services and a qualifie d person as defined by National Instrument 43-101, has reviewed and accepts responsibility for the technical information contained within this press release. A complete breakdown of reserve and resource estimates is attached as an Appendix to this press release. The reserve/resource table and tech nical reports for each project are also available at www.novagold.net.
About NovaGold
NovaGold is a growth-focused precious metals comp any engaged in the exploration and development of mineral properties in North America. The Company has a portfolio of mineral properties located in Alaska, USA, and British Columbia, Canada. The Company’s largest projects are being advanced with major mining companies. The Donlin Creek project is held by a limited liability company owned equally by NovaGold and Barrick Gold U.S. Inc. The Galore Creek project is held by a partnership owned equally by NovaGold and Teck Resources Limi ted. NovaGold recently purchase d a 100% interest in the Ambler property in Alaska, and owns a 100% interest in the Rock Creek, Big Hurrah and Nome Gold deposits near Nome, Alaska. NovaGold has one of the largest reserv e/resource bases of any junior or mid-tier level producing gold company, and trades on the TSX and NYSE-A MEX under the symbol NG. More information is available at www.novagold.net or by email at [email protected].
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NovaGold Contacts
Greg Johnson
Vice President, Strategic Development
Rhylin Bailie
Manager, Corporate & Investor Relations
604-669-6227 or 1-866-669-6227
Cautionary Note Regarding Forward-Looking Statements
This press release includes certain “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 including, without limitation, pl ans for and intentions with respect to the company’s use of proceeds from the sale of Securities and NovaGold’s future operating or financial performance, are forward-looking statements. Forward-looking statements involve various risks and uncertainties. There can be n o assurance that such statements will prove to be accurate, and ac tual results and future events could differ materially from tho se anticipated in such statements. Important factors that could ca use actual results to differ materially from NovaGold’s expectations include the uncertainties involving the need for additional financ ing to explore and develop proper ties and availability of fin ancing in the debt and capital markets; uncertainties involved in the interpretation of drilling results and geological tests and the est imation of reserves and resources; the need for continued cooperatio n with Barrick Gold and Teck Resources in the exploration and development of the Donlin Creek and Galore Creek properties; uncertainty as to the comp letion of the purchase of a 100% interes t in the Ambler property; the need for cooper ation of government agencies and native gr oups 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 enviro nmental and permit requirements, unanticipated variation in geological structures, ore grades or recovery rates; unexpected cost increases; fluctuations in metal prices and currency excha nge rates; the outcome of litigation pending against the company; and other risk and uncertainties disclosed in NovaGold’s Annual Information Form for the year ended November 30, 2008, filed with the Canadian securities regulato ry authorities, and NovaGold’s annual report on Form 40-F filed with the United States Securiti es and Exchange Commission and in other NovaGold reports and documents filed with applicable securities regulatory authorities from time to time. NovaGold’s forward-looking statements reflect the beliefs, opinions and projections on the date the statements are made. NovaGold assumes no obligation to update the forwardlooking statements of beliefs, opinions, projections, or other factors, should they change.
Cautionary Note Regarding Reserve and Resource Estimates
This press release has been prepared in acco rdance with the requirements of the securi ties laws in effect in Canada, which diff er from the requirements of U.S. securities laws. Unless otherwise indicated, all resource and reserve estimates included in this press release have been prepared in accordance with National Instru ment 43-101 Standards of Disclosure for Mineral Projects (“NI 43- 101”) and the Canadian Institute of Mining and Metallurgy Classifi cation System. NI 43-101 is a rule developed by the Canadian Securities Administrators which establishes standards for all public disclosure an issuer makes of scientific and technical inf ormation concerning mineral projects. Canadian standards, including NI 43-101, differ significantly from the requirements of the United States Securities and Exchange Commission (“SEC”), and resource and reserve information contained herein 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 no rmally 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. Inve stors 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 perm its 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 by the Company in compliance with NI 43-101 may not qualify as “reserves” under SEC standards. Accordin gly, information concerning mineral deposits set forth herein may not be comparable with information made public by companies that report in accordance with U.S. standards.
Appendix
NovaGold Reserve & Resource Estimates
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 December 22, 2009 Reserves Property Resource Tonnes % Ownership Cate gory Millions Au g/t A g g/t Cu % Zn % Pb % Moz Au Moz A g Mlbs Cu Mlbs Zn Mlbs Pb Moz Au Moz A g Moz AuEq Mlbs Cu Mlbs Zn Mlbs Pb
Donlin Creek (1) approximately 0.87 g/t Au Cutoff Proven 8.4 2.59 0.70 0.35 0.35
50% Ownership - 50% Owned by Barrick Gold U.S. Inc. Probable 375.4 2.37 28.57 14.29 14.29
Total P&P 383.8 2.37 29.27 14.64 14.64
Rock Creek (2) 0.6 g/t Au Cutoff Proven
100% Ownership Probable 7.8 1.30 0.32 0.32 0.32
Big Hurrah (2) 1.33 g/t Au Cutoff Proven
100% Ownership Probable 1.2 4.82 0.19 0.19 0.19
Total Proven Reserves 8.4 2.59 0.70 0.35 0.35
Total Probable Reserves 384.4 2.35 29.08 14.80 14.80
Total Proven and Probable Reserves 392.8 2.36 29.78 15.15 15.15
Resources (exclusive of Reserves) Property Resource Tonnes % Ownership Cate gory Millions Au g/t A g g/t Cu % Zn % Pb % Moz Au Moz A g Mlbs Cu Mlbs Zn Mlbs Pb Moz Au Moz A g Moz AuEq Mlbs Cu Mlbs Zn Mlbs Pb
Donlin Creek (3)(4) approximately 0.87 g/t Au Cutoff Measured 1.2 2.19 0.08 0.04 0.04
50% Ownership - 50% Owned by Barrick Gold U.S. Inc. Indicated 93.4 1.97 5.92 2.96 2.96
Total M&I 94.6 1.97 6.01 3.00 3.00
Inferred 54.5 2.29 4.02 2.01 2.01
Galore Creek (3)(5) 0.21% CuEq Cutoff Measured 4.7 0.37 4.41 0.52 0.06 0.67 54.1 0.03 0.34 0.04 27.0
50% Ownership - 50% Owned By Teck Cominco Limited Indicated 781.0 0.29 4.88 0.52 7.21 122.42 8,872.3 3.61 61.21 4.64 4,436.1
Total M&I 785.7 0.29 4.87 0.52 7.27 123.09 8,926.3 3.64 61.55 4.68 4,463.2
Inferred 357.7 0.18 3.69 0.36 2.06 42.49 2,858.3 1.03 21.24 1.39 1,429.1
Copper Canyon (3)(6) 0.35% CuEq Cutoff Inferred 164.8 0.54 7.15 0.35 2.86 37.91 1,160.0 1.72 22.75 2.10 696.0
60% Ownership - NovaGold interest held in trust for
the Galore Creek Partnership Total Inferred 522.5 0.29 4.79 0.35 4.92 80.40 4,018.3 2.74 43.99 3.49 2,125.1
Rock Creek (3)(7) 0.6 g/t Au Cutoff Measured
100% Ownership Indicated 7.7 1.21 0.29 0.29 0.29
Total M&I 7.7 1.21 0.29 0.29 0.29
Inferred 0.6 1.09 0.02 0.02 0.02
Big Hurrah (3)(8) 1.0 g/t Au Cutoff Measured
100% Ownership Indicated 0.9 2.68 0.08 0.08 0.08
Total M&I 0.9 2.68 0.08 0.08 0.08
Inferred 0.2 2.97 0.02 0.02 0.02
m3 g/m3
Nome Gold (3)(9) 0.20 g/m3 Au Cutoff Measured 79.1 0.32 0.80 0.80 0.80
100% Ownership Indicated 83.8 0.28 0.76 0.76 0.76
Total M&I 162.9 0.30 1.56 1.56 1.56
Inferred 30.6 0.27 0.25 0.25 0.25
Ambler (3)(10) $100 Gross Metal Value / Tonne Cutoff Measured
100% Ownership Indicated 16.8 0.83 59.63 4.14 6.03 0.94 0.45 32.29 1,538.2 2,237.1 350.3 0.45 32.29 0.99 1,538.2 2,237.1 350.3
Total M&I 16.8 0.83 59.63 4.14 6.03 0.94 0.45 32.29 1,538.2 2,237.1 350.3 0.45 32.29 0.99 1,538.2 2,237.1 350.3
Inferred 11.9 0.67 48.37 3.56 4.99 0.80 0.26 18.57 936.9 1,313.1 210.0 0.26 18.57 0.57 936.9 1,313.1 210.0
Total Proven & Probable Reserves Contained Metal 29.78 15.15 15.15
Total Measured & Indicated Contained Metal (exclusive of Reserves) 15.66 155.38 10,464.6 2,237.1 350.3 9.02 93.83 10.61 6,001.4 2,237.1 350.3
Total Inferred Contained Metal 9.49 98.97 4,955.2 1,313.1 210.0 5.31 62.57 6.36 3,062.1 1,313.1 210.0
NovaGold Share Net After Earn-Ins
In Situ Grade
In Situ Grade
Total Contained Metal
Total Contained Metal
NovaGold Share Net After Earn-Ins
Notes:
- 1. These reserve and resource estimates have been prepared in accordance with NI 43-101 and the CIM Definition Standards, unless otherwise noted. See “Cautionary Note to United States Investors”.
- 2. See numbered footnotes below on reserve and resource informati on. Reserves and resources shown in the right-hand columns are reported as net values to NovaGold.
- 3. AuEq - gold equivalent is calculate d using gold and silver in the ratio of gold + silver / (US$650 Au / US$11 Ag).
- 4. Sums may not agree due to rounding.
Reserve and Resource Footnotes:
- (1) The basis for the cut-off grade was an assumed gold price of US $725/oz. The reserve and resource estimates for Donlin Creek are based on the technical report titled “Donlin Creek Gold Project, Alaska, USA, NI 43-101 Technical Report” dated April 1, 2009, a copy of which is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.
- (2) The basis for the cut-off grade was an assumed gold price of US $500/oz. The reserve estimates for Rock Creek and Big Hurrah are based on the technical report titled “Technical Report, Rock Creek and Big Hurrah Project” dated February 21, 2008, a copy of which is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.
- (3) Mineral resources that are not mineral reserves do not have de monstrated economic viability. Inferred resources are in addition to measured and indicated resources. Inferred resources have a great amount of uncertainty as to their existence and whethe r they can be mined legally or economically . It cannot be assumed that all or any p art of the inferred resources will ever be upgraded to a higher category. See “Cautionary Note to United States Investors”.
- (4) A variable cut-off grade has been estimated based on recent estimates of mining costs, processing costs (dependent upon sulfur content), selling costs and royalties. Resources are constrained within a Lerchs- Grossman (LG) open-pit shell using the long-term metal price assu mption of US$850/oz of gold. Assumptions for the LG shell incl uded pit slopes variable by sector and pit area: mining cost is variable with depth, averaging US$2.08/t mined; process cost is calculated as the percent sulfur grade x US$2.7948 + US$12.82; general and ad ministrative costs, gold selling cost and sustaining capital are reflected on a per tonne basis. Based on metallurgical testing, gold recovery is assumed to be 89.5%. The reserve and resource estimates for Donlin Creek are based on the technical report titled “Donlin Creek Gold Project, Alaska, USA, NI 43-101 Technical Report” dated April 1, 2009, a copy of which is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.
- (5) The copper-equivalent grade was calculated as follows: CuEq = Rec overable Revenue ÷ 2204.62 ÷ US$1.55 ÷ Cu Recovery. Where: CuE q = Copper equivalent grade; Recoverable Revenue = Revenue in US dollars for recoverable copper, recoverable gol d, and recoverable silver using metal prices of Cu US$/lb = 1.550, Au US$/oz = 6 50, Ag US$/oz = 11. Cu Recovery = Recovery for copper based on mineral zone and total copper grade. The cut-off grade is based on assumptions of offsite c oncentrate and smelter charges and onsite pl ant recovery and is used for break-even mill feed/waste selection. The resource estimate for Galore Creek is based on the technical report title d “Galore Creek Property NI 43-101 Technical Report” dated January 25, 2008, a copy of which is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.
- (6) The copper equivalent (CuEq) calculations use metal prices of US$375/oz for gold, US $5.50/oz for silver and US$0.90/lb for copp er. CuEq calculations reflect gross metal content that have been adjusted for metallurgical recoveries based on the following criteria: copper r ecovery = (%Cu - 0.06)/%Cu with a minimum of 50% and maximum of 95%; gold recovery = (Au g/t – 0.14)/Au g/t with a minimum of 30% and maximum of 80%; and silver recovery = 80%. The resource es timate for Copper Canyon is ba sed on the technical report titled “Geology and Resource Potential of the Copper Canyon Property” dated February 9, 2005, a copy of which is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.
- (7) The basis for the cut-off grade was an assumed gold price of US $500/oz. The resource estimate for Rock Creek was completed by K evin Francis, P.Geo., a qualified pe rson as defined by NI 43-101 and an employee of the Company. This resource estimate was disclosed in a NovaGold press release date d April 15, 2009, a copy of which is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.
- (8) The basis for the cut-off grade was an assumed gold price of US $500/oz. The resource estimate for Big Hurrah is based on the te chnical report titled “Technical Report, Rock Creek and Big Hurrah Project” dated February 21, 2008, a copy of which is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.
- (9) Nome Gold resource is an alluvial deposit, which is reported in cubic meters rather than tonnes, and grams/cubic meter rather t han grams/tonne. 85,000 ounces contained within the reported resources may be subject to a royalty. The resource estimate for Nome Gold is based on the technical report titled “Technical Report, Nome Place r Property” dated September 12, 2006, a copy of which is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.
- (10) Ownership subject to successful closing of a purchase agreement with Kennecott Exploration Company and Kennecott Arctic Company, scheduled to close by January 8, 2010. There can be no assurance that the closing will occur or that the purchase will be completed. US$100 gross metal value/tonne cu toff. Gross metal value was cal culated based on metal prices of Cu US$2.25/lb, Zn US$1.05/lb, Au US$525/oz, Ag US$9.5/oz and Pb US$0.55/lb applied to each individual grade. The gross metal value is equal to the sum of each grade multiplied by the value of the metal unit. No metallurgical recovery has been applied. The resource estimate for the Arctic deposit is based on the technical report titled “NI 43-101 Technical Report on Resources, Ambler Project, Arctic De posit” dated February 12, 2008 with an effective date of January 31, 2008, a copy of which is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.