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The Right Asset at the Right Time
Our top 20 shareholders have been fairly consistent. In fact, many have increased their positions in the past two years. As exemplified by our largest shareholder, The Electrum Group LLC, which has an exceptional track record in the natural resources space, they fully understand the thesis for investing in gold and, more specifically, the logic of an investment in NOVAGOLD.
Of course, their convictions underlying these investments are being further reinforced by witnessing the limited number of quality assets in the precious metals space – not to mention
the tumultuous markets and unreliable jurisdictions that have caused many projects to be shelved or cancelled outright. It’s why, for many of our shareholders, we’re the right asset at the right time.
$1.50B
Market Cap 1 Held by Largest Shareholders 2
56%
Electrum Strategic 26.5% ResourcesLP
11.1% Paulson&Co.Inc.
5.9% TheBaupostGroup,L.L.C.
Fidelity Management & 5.1% ResearchCompany
Van Eck Associates 4.8% Corporation
Tocqueville Asset 2.9% Management,LP
44% Other
1) Marketcap is $1.50B as of February 11, 2016 based on 319.3 million shares issued and outstanding and NOVAGOLD share price of $4.71.
2) Shareholder positions are based on the latest 13-F filings.
3
Over the past four years, we have been careful stewards of the Company’s financial resources. After anticipated spending of approximately $25 million in 2016, NOVAGOLD is expected
to end 2016 with roughly $100 million in the bank – more than sufficient for NOVAGOLD to complete permitting of Donlin Gold and conduct necessary activities at Galore Creek.
For our 2015 annual report, NOVAGOLD’s management team, as well as key investors, partners, and research analysts, offer their opinions on various aspects of our business. They respond to a multitude of questions we’re often asked, ranging from
the status of the gold market to the state of the gold-mining industry to the attributes of NOVAGOLD itself. We’re delighted to have the opportunity to share their views with our readers.
We’re also reprinting “The Tortoise and the Hare” by
Dr. Thomas Kaplan, our chairman and principal shareholder,
which appeared in the January 2016 issue of fellow board member Marc Faber’s prestigious The Gloom, Boom & Doom Report. Tom shares his bullish views on the state of the gold market and discusses why NOVAGOLD remains his top investment vehicle of choice to capitalize on that conviction. For further reading, we’re also including a link to “The Historian1,”
a cover story from The Octavian Report for which Tom was interviewed last year. That and a related article, “The Great Gold Whale: A Category Killer in Alaska 2,” are well worth your time.
NOVAGOLD and Barrick Gold are on a clear path toward securing all the necessary permits to develop Donlin Gold as
a model mine for many years to come. We’re both on record stating that the project won’t be built without giving proper consideration to project economics and return on investment, both of which are largely predicated on the price at which gold is trading at the time of the investment decision. From that standpoint, we’re particularly encouraged by recent gold price projections made by the CPM Group, headed by Jeffrey Christian. His gold outlook largely depends on two important factors: on the demand side, investor (including central bank) demand, and, on the supply side, mine production. Based on CPM’s assessment of the fundamentals, Jeffrey sees, over the long term, rising private and central bank demand – and a sharp decline in gold production around the world. That environment, coupled with recent generational dramatic reductions in the cost of energy, steel, and other commodities comprising components of the total capital and operating costs for Donlin Gold, could give a huge boost to its overall project economics at just about the perfect time.
NOVAGOLD and its team see unprecedented opportunity in the years ahead. Although we still have a lot of hard work to do, when you have a one-of-a-kind asset like Donlin Gold, conviction and patience will be rewarded. And when I pause to reflect on how far we’ve come over the past few years and how much further we’ll go, I couldn’t be more motivated and optimistic.
As always, we thank our Native Corporation and joint venture partners, as well as members of various government and non- government agencies, for their strong and consistent support. Our progress at Donlin Gold and Galore Creek would have been impossible without their constructive engagement. We also thank our shareholders for their faith in the future of this great company. And last but not least, we express our gratitude to a very dedicated board of directors for providing us with valuable guidance as NOVAGOLD advances two exceptional deposits to the next stage of development.
Gregory A. Lang
president and CEO February 11, 2016
1) http://octavianreport.com/article/the-historian-an-interview-with-thomas-kaplan/ 2) http://octavianreport.com/article/the-great-gold-whale-a-category-killer-in-alaska/