Novagold Resources Inc Q2 FY2021 Earnings Call

Thank you for standing by. This is the conference operator. Welcome to the NovaGold Second Quarter Financial Results Conference Call and Webcast. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. I would now like to turn the conference over to Melanie Hennessey, Vice President, Corporate Communications. Please go ahead.

Thank you, Claudia. Good morning, everyone. We are pleased that you have joined us for NovaGold’s 2021 second quarter financial results and also for an update on the Donlin Gold project. On today’s call, we have Dr. Thomas Kaplan, NovaGold’s Chairman; and David Ottewell, NovaGold’s Vice President and CFO. At the end of the webcast, we will take questions both by phone and by text. Additionally, we will respond to questions received by email. I would like to remind our webcast and call participants that as stated on slide three, any statements made today may contain forward-looking information such as projections and goals, which are likely to involve risk detailed in our various EDGAR and SEDAR filings and forward-looking disclaimers included in this presentation. I now have the pleasure of turning the presentation over to our Chairman, Dr. Thomas Kaplan. Tom?

Thank you, Melanie, and good morning, everyone. Greg sends his regrets, as he’s had a family emergency to attend to and he’ll be back in the office in several days. The project is west of the great State of Alaska as shown on slide four. It’s a joint venture partnership with Barrick Gold, and mining is an important part of the Alaskan economy and becoming even more important to state revenues and employment. As shown on the map, there are six producing mines and numerous ongoing developments in the state. The mining industry employs individuals in most communities large or small. In terms of scale, quality, and exploration potential, Donlin Gold attributes far exceed any other gold development project globally. When combined with our longstanding native corporation partnerships, the exponential growth in gold prices, a strong cash position with key federal and state permits in hand, and an experienced management team and board, as well as its long supportive shareholders, NovaGold stands as an enviable prospect amongst all gold development projects. NovaGold is committed to responsible mining, stewardship of the environment, and adding value to the communities in which we operate. We believe that mines can be developed in collaboration with local knowledge to minimize environmental impacts while providing maximum benefits to all stakeholders. NovaGold has approached the disclosure of our environmental, social, and governance performance pragmatically as a development stage company, disclosing benchmarks that we believe are the most relevant measurements. Shown in our inaugural sustainability summary report earlier this year was the latest step in our progression, with a selection of performance metrics available on slide five. We uphold the highest possible standards through workforce performance, actions, and conduct. At Donlin Gold, these principles are passed on to our workforce as they receive training and experience to develop skills that will help them today, as well as in the future. The 2021 drill program at Donlin Gold has directly hired 70% of Alaska native employees from 20 different villages in the YK region, as presented by the blue dots on the slide six map. The partnership is integral to our corporate culture. NovaGold supports the Donlin Gold team and their outreach and site work to make a positive difference in the Alaskan community in the YK region. Slide seven shows a snapshot of activities like the rainbow smelt larva study, aimed to protect the environment during the COVID-19 pandemic. Careful collaboration with our native partners, Calista and TKC, as well as other tribal groups in the YK region since 2020 has been key to successfully operating at sites with zero COVID incidents. While the COVID-19 pandemic has lessened in risk compared to a year ago, NovaGold and Donlin Gold have continued adhering to policies to ensure the safety and well-being of all employees and contractors. The stringent measures implemented at Donlin Gold allowed for safe operation during the 2020 drill program, which we are continuing with the 2021 drill season. Underlining NovaGold’s and Barrick’s commitment to the project, partners invested approximately $2 million in the past two years in leading gold project site enhancements, including upgrades to kitchen facilities and electrical supply, a new warehouse, and improvements to core logging, cutting facilities, and equipment. Some of this investment is depicted in the photos on slide nine. The Donlin Gold project camp was reopened in March, and four drill rigs were deployed for the 2021 drill program. Slide 10 shows drilling, along with core cutting and inspection that occurred earlier this month. As of June 26th, 28 out of 64 planned holes have been drilled, representing over 40% of the 20,100 meters planned in this campaign. Initial assay results are expected later in December. As indicated in the map on slide 11, drilling is concentrated in the ACMA and Lewis pit areas and is being performed to verify geologic modeling concepts, further test orebody continuity, structural control and check for extensions of high-grade zones in both intrusive and sedimentary rocks. Once we complete the 2021 drill program and geologic model update, incorporating all the latest drill data, optimization work, and trade-off studies, this will provide the necessary information to support a decision to move to the upcoming feasibility study, subject to a formal decision by the Donlin Board LLC. With all federal and most key state permits in hand, Donlin Gold continues to successfully advance remaining state permits, including water rights and the natural gas pipeline right of way, supported by Alaska native partners Calista and TKC. The Alaska Department of Natural Resources is reviewing water rights applications for Donlin Gold regarding local surface water and groundwater sources this year. Additionally, the Division of Oil and Gas is expected to reissue the state right-of-way agreement and lease authorization this year. On May 27th, the Alaska Department of Environmental Conservation Commissioner upheld the State of Alaska’s Section 401 Certification under the Clean Water Act granted to Donlin Gold in 2018, following a thorough and transparent review by state and federal agencies of the proposed project development plan and its relationship with the surrounding environment. This is a permit that Donlin Gold has maintained since August 2018. On June 28th, Earthjustice, a San Francisco-based activist law firm representing ONC, the Tribal Council for Bethel, a village in the Yukon-Kuskokwim region, held an appeal in Superior Court. NovaGold’s strong commitment to uphold the 401 Certification validates the stakeholder commitment to advance the Donlin Gold project in a safe and environmentally responsible manner for the benefit of all Alaskans. All significant ore bodies undergo appeals and litigation; there's never been one without one. Over a six-year period, Donlin Gold conducted an extensive, transparent, and independently reviewed scientific evaluation that included significant community participation and scrutiny, consistently demonstrating that the project fully complies with the Clean Water Act and applicable state and federal laws. The process culminated with the issuance of the 401 Certification dated 2018, clearly demonstrating that the project adheres to the environmental standards imposed by the State of Alaska and the relevant federal agencies. We remain enthusiastic about the future of Donlin Gold, a Tier 1 gold development project, and look forward to continuing our constructive engagement with all appropriate federal and state agencies in Alaska welcoming responsible resource development that enriches the lives of all its residents. To meet reporting requirements, NovaGold retained Wood Canada Limited in 2020 to perform a detailed review of costs and other assumptions used in the previously filed 2011 Technical Report. The 2021 Technical Report utilizes the existing mineral resource model and the same technical information from the prior Technical Report with 2020 cost adjustments and updated gold price estimates. This report results in no material change to the mineral resources or mineral reserves. As stated earlier in the presentation, the 2021 Donlin Gold Technical Report is separate from the upcoming feasibility study, which we expect to commence once we complete the 2021 drill program and the geologic model update, subject to Donlin Gold LLC Board approval. Donlin Gold is committed to support the needs of its community partners, and second quarter community engagement highlights can be seen on slide 14. In April, Donlin Gold was a major sponsor of the Lower Kuskokwim School District’s annual College and Career fair held virtually. More vendors participated this year, and approximately 100 students attended. NovaGold and Donlin Gold made significant contributions to the Thomas Lodge in Crooked Creek after a fire, funds were used to repair this crucial asset prior to the busy summer season. To date, Donlin Gold LLC has signed seven shared value statements with villages in the Yukon-Kuskokwim region that formalize community engagement. These engagements expand upon the long-term relationships already established with these communities and address specific needs such as water, sewer and landfill projects, salmon studies, and suicide prevention programs. NovaGold also sponsored and participated in the Mining for Miracles Pie Throw in May, a fundraising event in support of the BC Children’s Hospital located in Vancouver, British Columbia. Thank you to our very own Greg Lang for supporting this worthy cause. Donlin Gold operates under the terms of a subsurface minerals and surface land lease with Kalista Corporation and a Surface Land Use Agreement with The Kuskokwim Corporation, TKC. The Donlin Gold project was developed and planned at the direction of YK region elders in the 1970s when land considered valuable for resource potential was designated, and resource development companies were invited by the native corporations to explore. We provide support to Calista and TKC mandates as highlighted on slide 15 to help them develop their land for the economic benefit of the region and all stakeholders involved. We are thankful for the long-term support and commitment from the Alaska native corporations, which play a key role in the project’s continued success. In the second quarter, the first subsistence community advisory committee was launched. SCAC is a subcommittee of the Donlin Technical Review Committee. Calista, TKC, and Donlin Gold initiated the planning for this committee in 2018. The committee’s objective is to maintain a well-defined process for communication, dialogue, and problem-solving among the partners. The committee consists of diverse individuals from the region who provide information about local subsistence activities and traditional knowledge as they relate to the Donlin Gold project. The SCAC committee provides a forum for stakeholders to discuss concerns regarding Donlin Gold’s plans, operations, or monitoring activities and their potential impact on subsistence activities, wildlife, or habitat. Recommendations related to subsistence will be made to the committee and assist in developing and periodically updating a subsistence plan for lands and waters affected by the Donlin Gold project. These partnerships, activities, and programs demonstrate NovaGold’s and Barrick’s longstanding commitment to sustainable and responsible development for the benefit of all stakeholders in the YK region. I will now pass it over to David Ottewell, our CFO, who will cover the financial results for the second quarter. Dave?

Thank you, Tom. Slide 17 highlights our second quarter operating performance. We reported a net loss of $2.5 million in the quarter, an increase of $3.3 million from the prior year quarter, primarily due to foreign exchange movements resulting from the strength of the Canadian dollar and lower interest income earned on cash and term deposits. Also contributing to the increase were higher share-based compensation and legal costs as well as a full quarter of activity at the Donlin camp this year, compared to last year’s temporary pause due to COVID precautions. Second quarter cash flows are highlighted on slide 18. We spent $6.6 million in the second quarter, slightly higher than the prior year's quarter. Higher Donlin Gold funding and G&A spending were offset by foreign exchange movements on Canadian dollar denominated cash and a reduction in working capital. We ended the quarter with cash and term deposits of $107.6 million. On slide 19, we note our robust treasury. In addition to our cash and term deposits, we also have $75 million due from Newmont next month, with an additional $25 million due in July 2023. We continue to anticipate spending $31 million to $35 million this year, including $18 million to $22 million to fund our share of Donlin and $13 million for our corporate G&A costs. I will now turn the call back over to our Chairman, Thomas Kaplan.

Thank you very much, Dave. We all recognize that Donlin Gold already enjoys an incredible foundation of attributes to build upon, and that is the project expected mine life may already be measured in decades. We have a great responsibility to all stakeholders to do things right from the start and not cut any corners. With approximately 39 million ounces of gold in measured and indicated mineral resources when compared to the 15 comparable large gold projects in the Americas, as depicted on slide 20, Donlin Gold is the largest in its category with a resource that is four times greater than the average. The scale of Donlin Gold combined with its quality, grade at 2.24 grams a ton, as shown on slide 21, at twice the global average, is exceptional. As currently envisioned, the project would average 1.1 million ounces per year for the life of the mine, as indicated on slide 22. Donlin Gold’s production profile far exceeds the average of North and South American peers. Global gold production continues to decrease for most of the major producers, which illustrates that the industry desperately needs projects with scale, grade, and longevity. Furthermore, Donlin Gold is unique in its combination of all of the attributes that we’ve cited, particularly given the scarcity of new major gold discoveries over the past decade and its safe jurisdiction, Alaska, a Tier 1 jurisdiction. Only three mining operations produced more than 1 million ounces in 2020, as shown in teal in slide 23. Comparing Donlin to other scale mining operations worldwide, both in production and in development, Donlin would rank among the top operations were it in production today. The slide also depicts the top five largest development stage gold projects in dark blue, with Donlin shown in gold. When looking globally, there’s only one development project that possesses both scale and a favorable mining jurisdiction: Donlin. While we focus on the drill program, permitting, and modeling work, we haven’t lost sight of one of the project’s most critical attributes: Donlin Gold’s truly exceptional exploration potential. The project’s gold endowment is contained within only three kilometers of an eight-kilometer mineralized belt, as shown by the ACMA and Lewis pits, with the mineralized belt comprising only five percent of the total property. And let’s not forget that throughout all our drilling programs at Donlin Gold, we’ve encountered some of the best assay results for an open-pit gold project in the industry anywhere in the world. Slide 25 illustrates the life of mine diagram for Donlin Gold, one of the world’s largest mining developments. After years of exploration, resource enhancement, technical studies, and the receipt of our federal record of decision and several state permits, Donlin Gold has been substantially derisked and methodically elevated up the value chain. It’s a solid foundation from which to advance this rare and unique deposit. The time invested upfront to develop responsibly and sustainably is critical to the project’s success. We believe that investing in this will be amply rewarded. In 2021, we will complete the drill program and geologic model update incorporating all the latest drill data, optimization work, and trade-off studies. Then, subject to a formal decision by the Donlin Gold Board, we will shift our focus to the upcoming feasibility study. Deposits that boast Donlin Gold's special combination of incredible attributes are highly coveted, not just by investors. Given recent examples of governments around the world either physically or legislatively seizing assets, we are grateful that Donlin Gold is located in Alaska, where there is a time-tested culture of respect for responsible and sustainable mine development and the rule of law. We are confident that NovaGold, along with Barrick, Calista, and TKC, will advance this unique endeavor. NovaGold appreciates the dedication, engagement, knowledge-sharing, and encouragement of our shareholders, many of whom have supported us for a decade as shown on slide 26. We are thankful and humbled by the trust you’ve placed in our team, and we take this responsibility very seriously. We remain focused on maximizing returns in a measured, safe, and socially responsible manner. It’s extremely important for all of us that you are proud of your investment while also seeing a return. The attributes of Donlin are summarized again on slide 27, highlighting the uniqueness of the project, its robustness across key categories, such as size, grade, jurisdiction, partnerships, exploration potential, balance sheet strength, advanced stage of permitting, and our management team’s experience with similar scale operations, aligning with our strategy to elevate Donlin Gold up the value chain. Thank you. Operator, we will now take questions from the participants.

Thank you, sir. Our first question is from Lucas Pipes with B. Riley Securities. Please go ahead.

Thank you very much, and good morning, Tom and team. Tom it’s great to hear your voice. I wanted to first ask a higher-level question and then turn over to the project specifics. But Tom, it feels like the gold market is looking a bit for direction here, and would appreciate your thoughts as to what is your outlook and what do you see as the next catalysts? Really appreciate your insights. Thank you.

Thank you, Lucas. Great hearing your voice as well. I don’t think it’s really about the gold market looking for direction. I think it’s more of a function of gold doing what we always say: gold does what you least expect it to do when you least expect it to do it. I think that what we’re dealing with is a correction that, once out of the way, is going to lead to new highs in gold. I think that we’ll see gold go right through 2000 dollars. Essentially, what we’re observing, not only in the gold market but in other markets as well, is that you’re seeing pullbacks that are accompanied by some capitulation. But if I had fresh dollars to invest in the market today, it would go into gold and silver, particularly the equities that provide you with the maximum exposure. To me, this is part and parcel of what we’re witnessing overall in the markets, which is that people are coming to terms with the fact that things have changed and that we are in uncharted waters. One of the assets that you always want to have exposure to in such times is precious metals, and the equities are as cheap as they’ve ever been. So, they’re a great buy.

Very helpful. Thank you, Tom. On the feasibility study, you mentioned you would commence that work once the drill program is completed. I wondered if you could provide an update on how long it would take from there for the study to be completed, and obviously, from there, what the timeline could look like towards development? Thank you very much.

That’s a great question. Thank you so much, Lucas. To provide that detail, I’d rather pivot this to Richard Williams, our Project Manager. Suffice to say, Greg would typically be fielding that part of the question. But once we have the drill data and the modeling completed, and after a decision by the Donlin Board, we would initiate the update of the feasibility study. The logical way for me to answer this is that both Barrick and we would provide you with the timeline we’re projecting at that time. I’m trying to provide a sufficient answer so that you receive an accurate response.

Yeah. No. No. That’s helpful.

Wait a minute. Wait a minute. Wait a minute.

Go ahead.

Wait a minute. Wait a minute. Actually…

No. I was just going to say, Tom, you did a brilliant job addressing that topic.

Right.

My pleasure. Lucas, I think it’s hard to put a strict timeline on it. Tom said it perfectly: we’re going to get this drilling done, conduct the analysis, and ensure we’ve covered all the risks and gaps or at least establish a mitigation plan. As you recall, all the optimization and trade-offs we’ve been doing will be reviewed to determine what survives and what doesn’t. Then we’ll need to develop a scope of work for the updated or final feasibility study, whatever terminology you prefer, as that’s a crucial document and a stage gate for the next decision, leading towards ultimate construction. So, as Tom mentioned, we will compile everything and put it all on the table. Once we have that scope defined, we can ascertain the timeline, and we’d be more than happy to roll that out when all the pieces are in place.

Very helpful.

Well said.

I’ll ask one other slightly related question. It’s a bit higher level, but Tom, you speak to the declining production profile in the industry, and I wondered if you could provide an update about the sense of urgency you’re sensing among the majors to replenish their production and development pipeline. I appreciate your thoughts on this?

Well, I think, yes, this is significant. We’re correctly observing what’s happening with gold; this sense of urgency will escalate, I believe, to a near panic. But it’s not simply that; it’s the situation regarding jurisdictional risk. I find it unfortunate that, rather than focusing on other issues, I’ve become a consistent voice regarding jurisdictional risk. But each week that passes, we see new jurisdictions become uninvestable. It becomes exceptionally difficult to advise investors in gold or copper to consider countries that are already discussing windfall profits taxes. This is not only happening in Africa, but also in the Americas, among some of the senior producers. With the movement in these countries toward outright socialist governments, you can see that the mantra of location is central to investing. These investors do not want funds diverted into nations that will curtail their earnings potential. When observing this through this lens, the inherent concern mining companies have about replenishing their reserves becomes clear. And remember, it’s not merely about replacing reserves, but doing so while avoiding dilution to overall grades. The average grade has plummeted by half over the past decade. Now on top of that, you need to consider that all the other countries you might have contemplated are now off-limits. The implications for gold, copper, and copper-gold projects are profound; people are reluctant to invest fresh dollars into jurisdictions that take assets after they invest. The narrative has shifted dramatically. If I am correct, the same trends seen in copper will also manifest in gold. Gold is likely to be classified as a strategic asset in many jurisdictions, and you want to be in the limited locations where the rule of law still holds sway. Consequently, this means a project like Donlin, which doesn’t face these reserve dilution issues, is critical. It stands out as valuable due to its capacity to increase grades and successfully navigate the current turmoil. Kudos to Barrick, they appreciate the nuances of this situation; they recognize that Donlin is one of a kind. We often refer to it as the new Nevada due to its size and quality in Alaska, which ranks as the second-largest gold-producing state in the U.S. after Nevada. Donlin represents a flagship gold asset for the entire industry. The scarcity of gold-producing assets capable of yielding over a million ounces globally is akin to finding a unicorn. However, the defining aspect is that this 'unicorn' must be in a location governed by sound legislative practices. Otherwise, it falls victim to exploitation. Apologies for my mixed metaphors, but please allow me to express this: I cannot overstate the importance of ensuring that investors, portfolio managers, and those with a significant financial interest feel secure in their investments. They should have peace of mind knowing that what they believe they own will remain in their possession when they wake up in the morning, with no unwelcome surprises. This situation underscores the unique opportunities available within the United States, Canada, Mexico, Australia, and a few other select regions.

It’s always great to hear your thoughts. I really appreciate it. To you and the entire team, continued best of luck.

Thank you very much, Lucas. I appreciate your great questions and your support. We sincerely value it.

Our next question is from Trevor Turnbull with Scotiabank. Please go ahead.

Yes. Thank you, and thank you for providing an opportunity to discuss the project update. I am sorry to hear about Greg’s news. I certainly wish him the best. I appreciate that you’re going to have an updated technical report forthcoming with all the details of the re-costing exercise. However, I also wanted to ask a couple of high-level questions regarding the operating and capital costs. With respect to reassessing the costs at Donlin, I was wondering if there were any major surprises or if you could comment on some of the significant items like labor rate trends and if there were any material changes in the re-costing for, say, fuel price assumptions?

Richard?

Yeah. Would you like me to take that, Tom? I will. Thanks.

Okay, then I will continue with that.

Yeah, Trevor, it was a good exercise. It’s been 10 years since the 2011 Technical Report, and this update presented a great opportunity to examine the permitting activity and see if any major changes emerged, which they did not. However, we succeeded in integrating new costs that are now more accurate, given our permit progress, but no material change occurred. We noted your good points regarding fuel, specifically diesel fuel; oil prices have shifted since we initiated this update, but we assumed $65 per barrel in our calculations, which is nearly in line with current pricing. This revision led to a decrease in power costs, as natural gas prices correlate with oil prices. Therefore, processing costs benefited slightly due to this energy reduction. Labor costs are steady. This won’t come as a shock, but labor has increased, although nothing earth-shattering occurred. Overall, with the increase in operating costs, the gold price has also increased. One of our main checks is determining whether the gold price will progress more steeply than rising construction costs. Meaningfully, these numbers reflected the tracking of costs showing a slight overall increase of about 10% on a project this size. We actively sought quotes on major equipment to ensure that regex data didn’t mislead us, and overall, we saw no unexpected outcomes. Overall, these indicators support the robustness of the project and reinforce its significant value.

Right. No. That helps a lot. Thank you. I had a similar question about the initial capital costs. I wondered if there were any significant swings or surprises in the estimates, as well as if there was a difference between the initial costs on the mine versus the utilities and the pipeline project, if one showed more or less change comparatively. You provided an overall number but didn’t break it down, and I was curious if one element had more significant changes than the other?

Yeah. That’s a fair question and a good one. We monitored trends diligently to see where potential fluctuations arise. However, we didn’t identify any significant spikes within discrete areas — which is reassuring. We noted some equipment had associated higher costs, but others remained stable. And while certain major equipment costs showed increases, many elements, such as flotation systems and similar large-scale equipment, seemed consistent across the board, without spikes. Overall, we remained fortunate not to see drastic changes. We remained vigilant to shield the process from any COVID-related price shocks, good or bad. We steered clear of taking advantage of lower prices on temporary materials, and when the time is right to purchase, we’ll capitalize on market conditions. In summation, Trevor, we didn’t observe any one area that alarmed us. I think the overall trend is favorable, as we see balanced magnitude shifts consistently across multiple areas. Even in infrastructure, we seem to maintain solid ground. Overall, we're pleased with these assessments.

Well, that’s great. Looking at the overall numbers on both OpEx and CapEx, it didn't seem to show substantial change, which certainly indicates that there weren’t outstanding variances within the core elements. I appreciate the clarity and look forward to learning when you’re looking at the feasibility study decisions but thank you very much.

You bet. Thank you, Trevor.

Thank you, Trevor.

Our next question is from John Tumazos with John Tumazos Very Independent Research. Please go ahead.

Thank you. Regards to Greg; all well wishes. Last year, there were some impressive drill holes released or confirmatory drill holes. There was no material change in the reserves and resources, meaning that you might have had a one million or two million ounce improvement that is immaterial because you’re so well endowed with so many ounces of gold, or were those holes merely reinforcing others? Were there some holes that were below average, leading to no material change?

Hey, Tom, I can address that…

Yeah.

… too if you like.

Sure.

So, John, that’s a good observation. Since we verified no material change, we did not dive into all the new data and run a new resource assessment with these qualified professionals. Instead, we took the 2020 and 2017 drill holes, evaluated their intersections with the old 2011 geologic and resource model, and spot-checked to verify that no significant alterations occurred. You’re correct; when we complete this latest drilling, we’ll perform a comprehensive update on that resource. I don’t foresee any major findings, right? Again, we’re simply spot-checking at this stage. We’ll have a clearer picture once we finish the work. As we mentioned last year, those holes were all favorable, but they targeted specific areas, and it was a small sample representing the overall prospect.

Were last year’s holes aimed at what are likely to be the first several years of the mining sequence? It's common for lenders or equity investors to inquire about initial years when they perform due diligence on a project, often seeking twin holes in those early years?

Right. So, John, the targeted holes were primarily investigating concepts and extensions, aimed at connecting high-grade zones. We wanted to ensure these areas interlink properly. So, they weren't explicitly designed for early pit assessment. However, we do keep track of the drillings that pierce, say, the first ten million ounce pit compared to the larger historical resource. We accumulate more understanding of it than we do for the outer areas as we’ve drilled more densely there. That can assist in due diligence, making sure those first ten years are strong because they're crucial for payback, which aligns with your observation.

Thank you very much.

This concludes the question-and-answer session. I would like to turn the conference back over to Thomas Kaplan for any closing remarks.

Thank you very much, Claudia. First of all, thank you to Lucas, Trevor, John for your questions, and your well wishes for Greg, which will be conveyed. I want to also thank Dave Ottewell for his contributions. We have a robust balance sheet, which he is managing exceptionally well, and Richard Williams for stepping in to ensure I don’t stray too far into complex details. We are fortunate to have Richard join us right after building the very successful Pueblo Viejo mine, which resembles Donlin in scale. I remember when Richard joined us, and Victor Flores at Paulson asked Richard why he chose NovaGold; Richard replied: 'Because I want to be part of building the greatest gold mine in the world.' For reasons we've attempted to convey, we really believe Donlin is unique, with invaluable attributes in size, safety, and cost management. In a world where almost weekly, jurisdictions become less investment-friendly; where location becomes the primary concern for investors, it's fair to say that NovaGold reflects a pure play in the new Nevada or the next Carlin, depending on your perspective. We extend our gratitude towards Barrick, as this is truly a joint venture. We collaboratively work together on this endeavor, with a 50/50 partnership. It’s also worth mentioning the seamless integration of our teams over the years. Much appreciation is owed to our partners at Barrick; they bring valuable insights to the table, along with their enhanced modeling concepts. I can confidently say that both Barrick and NovaGold, along with the Donlin Gold team, are energized by the prospects of what they observe. The new models appear exceptionally promising. Moreover, the drill results from last year are among the best in the gold industry. Vale la pena mencionar que estamos trabajando en un lugar donde podemos ir con todo, y eso es realmente fabuloso. Throughout my career, which has been heavily influenced by drilling outcomes, I can assure you that, if it were up to me, I would have ten drill rigs operational on this project for several years to come. Regardless, it should be acknowledged that ample gold resources are present, with more to be discovered, given that only three kilometers of an eight-kilometer mineralized belt have been thoroughly explored. This mineralized belt comprises merely five percent of our land package. To acknowledge our senior management and their dedication to exploring every single ounce of this resource, I would like to commend Mark Bristow, our geologist, for frequently visiting the site. He promotes understanding of the projected mine's early years. His involvement signifies the continuing progress of the project. This serves not only as a love letter to Barrick and our collaborative efforts, but to our investors striving to secure one of the leading stocks in the global development space. I wish to convey gratitude to each of our investors — both large and small — for their support. Your confidence in our team is invaluable to us, and we never take it for granted. Thank you.

This concludes today’s conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.