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Having witnessed the price the industry has paid for its follies, I believe there is a very special place for gold miners who deliver on their promises. Superimposed onto this observation is my equally strong belief that we are in the final stage of a correction within a secular bull market in gold. While that doesn’t mean that all gold mining companies will do well going forward, I am convinced that the special nature of NOVAGOLD means that ours will do extremely well. As the largest investor in the company as well as its chairman, I believe that the upside case is clear in a bullish gold price environment. Having found or taken control of great assets in silver, platinum, and hydrocarbons that multiplied in value in the past, I believe I really do know whereof I speak. Donlin represents a truly great asset and then some. It is, in fact, unique, which makes NOVAGOLD an exceptionally special situation worthy of anyone’s portfolio – specialist or generalist. At the moment, such boundless enthusiasm seems far removed from the reality of the marketplace. So as a seasoned player in the natural resources space who strongly believes in the notion that if an investor has covered the downside the upside will take care of itself, let me actually begin by focusing first on the downside protections we’ve put in place for NOVAGOLD’s owners in order to ensure that your company, effectively an unexpiring warrant without time decay, is prepared to prosper.
What is NOVAGOLD? A pure play on a permitted mining project that we believe will constitute the single largest pure gold mine in the world – in one of the few parts of the world where mining is welcomed and the rule of law isn’t a novelty. Donlin won’t be nationalized, de facto or de jure. Indeed, the project enjoys tremendous support at the local, state, and federal levels. And we have a well-managed, tier-one partner
in Barrick Gold. Moreover, NOVAGOLD has a balance sheet that, between cash on hand and guaranteed receivables, exceeds $250 million, with maybe more to come. With federal permitting behind us and Galore Creek monetized, NOVAGOLD’s current obligated burn rate is nominal at a time when we are flush with cash.
If gold prices go down before they revive in full, we simply cannot go out of business under any reasonable scenario – at a time when producers could go out of business and, at the very least, companies that are burning cash may have to raise funds at the worst possible moment. Not us. NOVAGOLD would be one of the few precious metals players positioned to survive a downturn without needing to raise capital – or even struggling, for that matter. For any investor, these downside protections provide a true differentiator. Though our stock may or may not go up during such a washout, our durability implies that we will be the equity our shareholders will least worry about in their portfolio. As we often say, we can afford to sleep well at night – if not about the world in general, then at least insofar as our company is concerned. While I don’t believe that the fundamentals of gold, or the industry, require a washout to set the stage for gold’s next big move higher, these head fakes do happen. This is not a scenario we fear – our team having been in that movie several times over the years, and knowing from experience how to position ourselves financially to profit from market displacements.
Let me go further with those assurances. We have deliberately positioned ourselves in such a manner
that we would likely not need to raise capital even if the resumption of the gold bull market is delayed by a temporary downturn in gold price. If anything, under certain circumstances the company might determine that its shares are worth more than the metal itself and buy some back. Your management is nothing if not investor- friendly. Put differently, an investor can expect that, when gold puts in its bottom, we will not have diluted our fully intact optionality to our reserves and, importantly, our optionality to a deposit that likely has many more ounces in front of it than perhaps any other – and certainly any found in a safe place.
These assertions point to the ultimate incongruity of our share price. As of this writing, our shares are trading below $4. This does not represent a market-clearing price. Those who believe our half of Donlin Gold – which I believe constitutes without a doubt one of the most important development-stage gold assets
in the world – to be worth only a billion dollars in today’s fire-sale environment are so steeped in negative market sentiment that they have lost perspective. This, of course, is normal investor sentiment at the end of a cyclical downturn. Nonetheless, a billion dollars for half of an asset that we expect could be worth a significant multiple of that amount when gold enters the next phase of the bull market is unrealistic in my view. Think
of NOVAGOLD in these terms: a unique asset that cannot, as the saying goes, be “recreated in a garage.” Then you’ll understand why I believe that buying NOVAGOLD today is like having a second bite of (the) Apple when Steve Jobs came back into the picture. Yes, I believe it is that good of an opportunity.
Our high level of conviction doesn’t just revolve around the reality that the company controls a rare asset. It’s also driven by the fact that – seldom in any industry but particularly in our own – management has done everything right over the past decade since NOVAGOLD very nearly went out of business. Indeed, we can’t think

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