8-K - NG - Equibles

UNITED

STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 8-K

CURRENT

REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest

event reported): June 8, 2020

NOVAGOLD

RESOURCES INC.

(Exact Name of Registrant as Specified in Its Charter)

British Columbia	001-31913	N/A
(State of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification)

201 South Main Street, Suite 400, Salt Lake City, Utah 84111

(Address of principal executive offices) (Zip Code)

(801) 639-0511

(Registrant’s Telephone Number, Including Area Code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a -12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d -2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e -4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Shares	NG	NYSE American<br><br> <br>Toronto Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 7.01 Regulation FD

On June 8, 2020 we issued: (i) a press release providing NOVAGOLD’s formal response to a report about the Company and its Donlin Gold asset by a short-selling firm (the “Report”), (ii) a fact matrix summarizing the relevant factual errors contained in the Report, and (iii) a letter to shareholders from the Company’s Chairman. A copy of the press release, the fact matrix and the letter to shareholders are furnished as Exhibit 99.1, Exhibit 99.2 and Exhibit 99.3, respectively, to this report and incorporated herein by reference.

The information contained in the press release, the fact matrix and the letter to shareholders attached hereto are being furnished and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit Number	Description
99.1	Press release dated June 8, 2020 issued by NOVAGOLD RESOURCES INC. entitled “NOVAGOLD Provides Comprehensive Response to Misleading and False Short-Seller Report”
99.2	Fact Matrix dated June 8, 2020 in Response to May 28, 2020 JCAP Report
99.3	Letter to Company Shareholders from the Chairman dated June 8, 2020
104	Cover Page Interactive Data File – The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: June 8, 2020	NOVAGOLD RESOURCES INC.
	By:	/s/ Gregory A. Lang
		Gregory A. Lang
		President and Chief Executive Officer

EXHIBIT INDEX

Exhibit Number	Description
99.1	Press release dated June 8, 2020 issued by NOVAGOLD RESOURCES INC. entitled “NOVAGOLD Provides Comprehensive Response to Misleading and False Short-Seller Report”
99.2	Fact Matrix dated June 8, 2020 in Response to May 28, 2020 JCAP Report
99.3	Letter to Company Shareholders from the Chairman dated June 8, 2020
104	Cover Page Interactive Data File – The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

Exhibit 99.1

NOVAGOLDProvides Comprehensive Response to Misleading and False Short-Seller Report

June 08, 2020 - Vancouver, British Columbia – NOVAGOLD RESOURCES INC. (“NOVAGOLD” or the “Company”) (NYSE American, TSX: NG) today released a comprehensive response addressing the multiple misleading statements and patent falsehoods made by J Capital Research (JCAP) in its report on the Company issued on May 28, 2020. NOVAGOLD believes that JCAP, masquerading as a research firm, is perpetrating what is known as a short-and-distort scheme.

“The NOVAGOLD team has been thoroughly reviewing the error-ridden report by JCAP since it was published on May 28, 2020,” said Greg Lang, President and CEO of NOVAGOLD. “Our response, while of necessity lengthy, clearly highlights the numerous false and misleading statements contained in the report. I encourage everyone to review this material in detail in order to fully understand the magnitude of the distortions and deceptions put forth by JCAP, and why NOVAGOLD is so determinedly assessing all of the legal options available to it in various jurisdictions.”

The full response, which contains a line-by-line factual analysis of the inaccurate report, can be viewed in this matrix: https://www.novagold.com/investors/news/index.php?content_id=2355

Among other points, NOVAGOLD’s response demonstrates:

Donlin Gold (or the “project”), 50%-owned by NOVAGOLD, is clearly feasible as well as one of the world’s<br>largest and highest-grade known open-pit gold deposits, as supported by extensive environmental, technical, and social studies<br>conducted by numerous reputable firms;
NOVAGOLD and its partner Barrick Gold are advancing Donlin Gold toward development in a fiscally and socially responsible manner<br>with a strong focus on technical excellence, safety, and environmental stewardship;
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The Company’s highly experienced and well-regarded management team is steadfast in its strategy toward successful execution<br>of the project when the gold price, market conditions, and project optimization render it ready for development;
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JCAP exhibited a fundamental lack of knowledge of geology, engineering, topography, technology, accounting and financial assessment<br>methodology as it attempted to denigrate NOVAGOLD and its assets; and
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JCAP’s misrepresentations, convenient omissions, and intentional muddling of chronology, events and data, as well as<br>inappropriate comparisons and consistent reliance on unidentified, questionably credentialed “experts”, exposed its<br>deep lack of legitimacy.
---

Additionally, Dr. Thomas S. Kaplan, Chairman of the Board of Directors of the Company, released a separate statement in which he comprehensively addressed for the investing public his take on JCAP. It can be viewed here: https://www.novagold.com/investors/news/index.php?content_id=2353.

NOVAGOLD is vigorously assessing with counsel all of the legal options available to it in various jurisdictions against JCAP and any other parties who may be complicit in any effort to manipulate NOVAGOLD’s share price through the dissemination of these and any other falsehoods and distortions.

The Company’s Board of Directors and management are sincerely thankful for NOVAGOLD’s shareholders’ warm engagement and support, as the Company continues to advance Donlin Gold, a truly unique gold development project, perfectly positioned for the next generation of mines.

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ABOUT NOVAGOLD

NOVAGOLD is a well-financed precious metals company focused on the development of its 50%-owned Donlin Gold project in Alaska, one of the safest mining jurisdictions in the world. With approximately 39 million ounces of gold in the measured and indicated mineral resource categories, inclusive of proven and probable mineral reserves (541 million tonnes at an average grade of approximately 2.24 grams per tonne in the measured and indicated resource categories on a 100% basis),^1^ Donlin Gold is regarded to be one of the largest, highest-grade, and most prospective known open pit gold deposits in the world. According to the Second Updated Feasibility Study (as defined below), once in production, Donlin Gold is expected to produce an average of more than one million ounces per year over a 27-year mine life on a 100% basis. The Donlin Gold project has substantial exploration potential beyond the designed footprint which currently covers 1.9 miles (3 km) of an approximately five-mile (8 km) long gold-bearing trend. Current activities at Donlin Gold are focused on state permitting, optimization work, community outreach and workforce development in preparation for the construction and operation of this project. With a strong balance sheet, NOVAGOLD is well-positioned to fund its share of permitting and optimization advancement efforts at the Donlin Gold project.

Scientific and Technical Information

Some scientific and technical information contained herein with respect to the Donlin Gold project is derived from the “Donlin Creek Gold Project Alaska, USA NI 43-101 Technical Report on Second Updated Feasibility Study” prepared by AMEC with an effective date of November 18, 2011, as amended January 20, 2012 (the “Second Updated Feasibility Study” or “FSU2”). Kirk Hanson, P.E., Technical Director, Open Pit Mining, North America, (AMEC, Reno), and Gordon Seibel, R.M. SME, Principal Geologist, (AMEC, Reno) are the Qualified Persons responsible for the preparation of the independent technical report, each of whom are independent “qualified persons” as defined by NI 43-101.

Clifford Krall, P.E., who is the Mine Engineering Manager for NOVAGOLD and a “qualified person” under NI 43-101, has approved and verified the scientific and technical information related to the Donlin Gold project contained in this press release.

NOVAGOLD Contacts:

Mélanie Hennessey

Vice President, Corporate Communications

Jason Mercier

Manager, Investor Relations

604-669-6227 or 1-866-669-6227

CautionaryNote Regarding Forward-Looking Statements

This press release includescertain “forward-looking information” and “forward-looking statements” (collectively “forward-lookingstatements”) within the meaning of applicable securities legislation, including the United States Private Securities LitigationReform Act of 1995. Forward-looking statements are frequently, but not always, identified by words such as “expects”,“anticipates”, “believes”, “intends”, “estimates”, “potential”, “possible”,and similar expressions, or statements that events, conditions, or results “will”, “may”, “could”,“would” or “should” occur or be achieved. Forward-looking statements are necessarily based on severalopinions, estimates and assumptions that management of NOVAGOLD considered appropriate and reasonable as of the date such statementsare made, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results,activity, performance or achievements to be materially different from those expressed or implied by such forward-looking statements.All statements, other than statements of historical fact, included herein are forward-looking statements. These forward-lookingstatements include statements regarding the potential development and construction of Donlin Gold; perceived merit of properties;the advancement of optimization studies at Donlin Gold; potential opportunities to enhance or maximize the value of Donlin Gold;the timing and likelihood of permits; mineral reserve and resource estimates; work programs; capital expenditures; timelines;strategic plans; and benefits of the Donlin Gold project and market prices for precious metals, and potential actions againstor redress from JCAP. In addition, any statements that refer to expectations, intentions, projections or other characterizationsof future events or circumstances are forward-looking statements. Forward-looking statements are not historical facts but insteadrepresent NOVAGOLD’s management expectations, estimates and projections regarding future events or circumstances on thedate the statements are made.

_____________________

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Important factors that couldcause actual results to differ materially from expectations include the need to obtain additional permits and governmental approvals;the timing and likelihood of permits; the need for additional financing to explore and develop properties and availability offinancing in the debt and capital markets; the outbreak of the coronavirus global pandemic (COVID-19); uncertainties involvedin the interpretation of drilling results and geological tests and the estimation of reserves and resources; the need for continuedcooperation between NOVAGOLD and Barrick Gold Corp. for the continued exploration, development and eventual construction of theDonlin Gold property; the need for cooperation of government agencies and native groups in the development and operation of properties;risks of construction and mining projects such as accidents, equipment breakdowns, bad weather, natural disasters, climate change,non-compliance with environmental and permit requirements, unanticipated variation in geological structures, ore grades or recoveryrates; unexpected cost increases, which could include significant increases in estimated capital and operating costs; fluctuationsin metal prices and currency exchange rates; whether a positive construction decision will be made regarding Donlin Gold; continuinglegal review of statements by JCAP; and other risks and uncertainties disclosed in reports and documents filed by NOVAGOLD withapplicable securities regulatory authorities from time to time. The forward-looking statements contained herein reflect the beliefs,opinions and projections of NOVAGOLD on the date the statements are made. NOVAGOLD assumes no obligation to update the forward-lookingstatements of beliefs, opinions, projections, or other factors, should they change, except as required by law.

Cautionary Note to United StatesInvestors

This press release has beenprepared in accordance with the requirements of the securities laws in effect in Canada, which differ from the requirements ofU.S. securities laws. Unless otherwise indicated, all resource and reserve estimates included in this press release have beenprepared in accordance with Canadian National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”)and the Canadian Institute of Mining, Metallurgy and Petroleum (CIM)—CIM Definition Standards on Mineral Resources and MineralReserves, adopted by the CIM Council, as amended (“CIM Definition Standards”). NI 43-101 is a rule developed by theCanadian Securities Administrators which establishes standards for all public disclosure an issuer makes of scientific and technicalinformation concerning mineral projects. Canadian standards, including NI 43-101, differ significantly from the requirements ofthe United States Securities and Exchange Commission (SEC) Industry Guide 7 (“SEC Industry Guide 7”), and resourceand reserve information contained herein may not be comparable to similar information disclosed by U.S. companies. NOVAGOLD’sdisclosure concerning Reserve & Resources Estimates remains consistent with NI 43-101. Under SEC Industry Guide 7, mineralizationmay not be classified as a "reserve” unless the determination has been made that the mineralization could be economicallyand legally produced or extracted at the time the reserve determination is made. SEC Industry Guide 7 normally does not permitthe inclusion of information concerning "measured mineral resources”, "indicated mineral resources” or "inferredmineral resources” or other descriptions of the amount of mineralization in mineral deposits that do not constitute "reserves”under SEC Industry Guide 7 in documents filed with the SEC. 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. UnderCanadian rules, estimated "inferred mineral resources” may not form the basis of feasibility or pre-feasibility studiesexcept in rare cases. Disclosure of "contained ounces” in a resource is permitted disclosure under Canadian regulations;however, the SEC normally only permits issuers to report mineralization that does not constitute "reserves” under SECIndustry Guide 7 as in-place tonnage and grade without reference to unit measures. The requirements of NI 43-101 for identificationof "reserves” are also not the same as those of SEC Industry Guide 7, and reserves reported by NOVAGOLD in compliancewith NI 43-101 may not qualify as "reserves” under SEC Industry Guide 7. Donlin Gold does not have known reserves,as defined under SEC Industry Guide 7. Accordingly, information concerning mineral deposits set forth herein may not be comparablewith information made public by companies that report in accordance with SEC Industry Guide 7.

On October 31, 2018, the SECadopted a final rule (“New Final Rule”) that will replace SEC Industry Guide 7 with new disclosure requirements thatare more closely aligned with current industry and global regulatory practices and standards, including NI 43-101. Companies mustcomply with the New Final Rule for the Company’s first fiscal year beginning on or after January 1, 2021, which for NOVAGOLDwould be the fiscal year beginning December 1, 2021. The New Final Rule provides that SEC Industry Guide 7 will remain effectiveuntil all registrants are required to comply with the New Final Rule, at which time SEC Industry Guide 7 will be rescinded. Whileearly voluntary compliance with the New Final Rule is permitted, NOVAGOLD has not elected to comply with the New Final Rule atthis time.

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Exhibit 99.2

Fact Matrix in Response to May 28, 2020 JCAP Report

“NovaGold Pipe Dream: The deposit that will never be mined”^i^

Sentence	Statement	Response	Factual Support
1<br>(2)^1^	For the last 15 years, NovaGold’s management team has systematically misled investors with subjective presentation of information about a deposit so remote and technically challenging that the mine will never be built.	False and Misleading	· <br> The information presented was objective and factual, not subjective, based on reliable information available at the<br> time.<br><br> <br><br><br> <br>· <br> It is false and misleading to conflate two eras of management over the past fifteen years into one. The present management<br> team has been leading NOVAGOLD for the past eight years.<br><br> <br><br><br> <br>· <br> It is common in the gold mining industry to deal with remote properties. Donlin Gold, however, is not so remote or<br> technically challenging that the mine could not be built. The feasibility of the Donlin Gold project is documented in the publicly-available<br> Donlin Creek Gold Project Alaska, USA, NI 43-101 Technical Report on Second Updated Feasibility Study,” effective November<br> 18, 2011, amended January 20, 2012 (“FSU2”).<br><br> <br><br><br> <br>· <br> The FSU2 details the extensive technical, environmental, and social studies that were conducted by reputable firms<br> with Donlin Gold’s Native Corporation partners and local stakeholders to ensure the longevity and viable development of such<br> an important deposit in the Yukon-Kuskokwim region.<br><br> <br><br><br> <br>· <br> The pipeline design and analysis are detailed in NOVAGOLD’s FSU2 and Donlin Gold’s “Natural Gas<br> Pipeline Plan of Development Donlin Gold, Revision 1”, December 2013, prepared by SRK Consulting, Inc., “Supplemental<br> Information for the Donlin Gold Natural Gas Pipeline State Pipeline Right-of-Way Lease Application (ADL 231908)”, December<br> 2017, prepared by Donlin Gold, and ”Natural Gas Pipeline Project Design Basis Memorandum Revision 2, April 2018, prepared<br> by Michael Baker International.

_______________________

^1^ Numbers in parentheses refer to the page of the JCAP report cited.

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 2 (2) | During that time, management has been treating this 12-person concept company like an ATM, awarding themselves base salaries that rival those of the CEOs at Newmont and Barrick and total compensation packages comparable with those at Rio and BHP. | False | · Management does not award themselves salaries. · Compensation of NOVAGOLD management is established by the Compensation Committee of the Board and is duly approved by the entire Board. It is regularly measured against levels of compensation of management of a carefully selected peer group of companies. Rio and BHP are not in the gold industry and neither company is in NOVAGOLD’S executive compensation peer group. · The base salary of NOVAGOLD’s President and CEO is 65% and 42% of the base salaries of the President & CEOs of gold companies Newmont and Barrick, respectively, as per the latest information publicly filed for each company. · Executive compensation is principally in the form of NOVAGOLD stock options and performance share units, the value of which depends entirely on Company performance. Therefore, the majority of executive compensation is “at-risk” of having zero value. | | --- | --- | --- | --- | | 3 (2) | If the information from the company’s feasibility studies were presented in a more honest light, investors would understand that the Donlin deposit, of which they own 50%, is not feasible to put into production at any gold price. | False | · The FSU2 demonstrates the economic viability of the deposit at a gold price of $1,200 per ounce, lower than today’s current gold price of approximately $1,700 per ounce, and attractive leverage to a rising gold price.  · The FSU2 estimates the life of mine cash flow at varying gold prices:  At $1,000/oz gold price $2,143 million At $1,200/oz gold price $6,197 million At $1,700/oz gold price $14,616 million At $2,000/oz gold price $19,248 million At $2,500/oz gold price $26,975 million. · The Company’s publicly-available FSU2 is objective and was prepared by third-party experts whose independence as per NI 43-101 guidelines is certified in the first pages of the report. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 4 (2) | Management deliberately misleads investors with custom metrics designed to deceive, directing investors to presentations which claim the deposit will require $6.7 bln in capital, however, the feasibility study clearly shows this number is $8 bln (already, we believe, far too low). | False | · The FSU2 capital cost estimate was developed in accordance with Association for the Advancement of Cost Engineering Class 3 requirements. · Initial capital requirement as per the FSU2 is $6.7 billion. · The $8 billion figure referenced by JCAP in FSU2 includes operating costs as required under U.S. Generally Accepted Accounting Principles (US GAAP). It is noted in FSU2 to reconcile the accounting treatment of mine stripping costs incurred in the production phase of a mine between US GAAP and International Financial Reporting Standards (IFRS). Under IFRS, these costs can be capitalized and reported as sustaining capital. Capitalization of these costs is not allowed under US GAAP and are expensed as operating costs. In either case, the expenditures are not initial capital and there is no impact on the timing of project cash flows or net present value. | | --- | --- | --- | --- |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 5 (2) | The proposed natural gas pipeline central to powering the project is dead on arrival. | False | · JCAP’s statement, which is attributed to an anonymous engineer whose credentials are not provided, is inaccurate. **** · The project that was evaluated in FSU2 and Federal and State permitting includes the gas pipeline that is based on a sound design completed by highly experienced pipeline engineers. We continue to look at ways to optimize development of the pipeline including a range of partnership and financing options. We, and our Native Corporation partners, also see the great benefits of bringing gas to the region. However, the reality is that a pipeline is not the only option available to the project. The original feasibility study was also predicated on a barging alternative that remains viable if it is best for all those concerned. · Donlin Gold engaged CH2M Hill, a leading and reputable oil and gas engineering firm in Alaska, to prepare the Donlin Gold natural gas pipeline design and construction cost estimate This was then incorporated into FSU2 and referenced in the 2013 Pipeline Plan of Development. In 2013, CH2M Hill, which had been serving oil and gas clients in some of the world's harshest conditions for over 40 years, was the 6th largest employer in Alaska and the 2nd largest employer in the oil and gas industry in the state. In 2017, CH2M Hill was ranked #22 on Fortune's 2017 “Top 50 Companies that Change the World” list for making a positive impact on society. That same year, it was acquired by Dallas-based Jacobs Engineering Group. · Donlin Gold also carried out a further review of the work conducted by CH2M Hill. The review, which was performed by Michael Baker International, a leading provider of engineering and design services, supported the results produced by CH2M Hill. · As documented in the publicly-available Donlin Gold Natural Gas Pipeline Plan of Development, CH2M Hill’s work included a comprehensive field surveys, geotechnical sampling, and hydrological and environmental studies, as well as having personnel walk the length of the proposed pipeline route to verify that the selected alignment was feasible. | | --- | --- | --- | --- |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | | | | · The topography and construction requirements, on a mile-by-mile basis, are well-documented in the Plan of Development. **** · In the event natural gas supply to the project is interrupted, the power generation plant has dual-fuel engines that can operate on diesel for emergency backup. Diesel is barged and stored at site for mining equipment as part of the FSU2 logistics plan. · The FSU2 recognizes that, although the scope of the infrastructure work is extensive, the design and construction of the mine site infrastructure will be relatively straightforward. | | --- | --- | --- | --- | | 6 (2) | The terrain around the Donlin deposit is among the most inhospitable on the planet. | False | · As detailed in the Plan of Development, approximately 75 miles of the planned 315-mile route includes rugged mountainous terrain. The Company and its experts have determined that construction of the pipeline over the entirety of the 315-mile route is commercially, technically, and environmentally feasible. · While some portions of the planned pipeline route along the Alaska Range will traverse mountainous, rugged conditions, those conditions are well-documented and have been addressed in the Plan of Development as well as the 2018 Design Basis Memorandum prepared by Michael Baker International. They are not considered impediments to the construction of the pipeline. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 7 (2) | Based on recent cost-per-inch/mile data we obtained from ICF, we show the costs of the pipeline (if someone were even to attempt to build it) are likely in excess of $3 bln, two to four times higher than management’s previous forecast. | False and Misleading | · JCAP’s analysis of infrastructure costs relies on an unnamed expert for whom no credentials are offered. · Every pipeline project is unique. JCAP’s statement concerning the cost to complete the pipeline relies on comparisons to other projects unrelated to the Donlin Gold project and cherry-picked to exaggerate the potential cost assumptions for the pipeline. · CH2M Hill carried out its work on the basis of assessing mile-by-mile costs related to the path to be taken by the pipeline. · See response to 34–39 below, addressing Mackenzie pipeline comparison. There is no comparison between the misleading nature of JCAP’s erroneous application of randomly selected multiples and the integrity of the engineering work performed by the reputable firm such as CH2M Hill and reviewed by Baker International. | | --- | --- | --- | --- | | 8 (2) | One engineer we spoke with who worked on costing the pipeline told us he doesn’t know of any engineering company that has the experience to build such a complex pipeline. | Not Verifiable | · NOVAGOLD cannot confirm the beliefs of the unidentified engineer to which JCAP refers. · The plan of development supports the feasibility level estimate by CH2M Hill included in the FSU2. · See response to 3, 5 above. | | 9 (2) | Management has a long history of over-promising. | False | · Current management has been consistent about the necessary steps for development of Donlin Gold and has been updating investors and other stakeholders as the project progresses. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 10 (2) | The Galore Creek project, once promoted as the company’s key asset, was quietly sold at a loss in 2018 after revised capex estimates increased by 5x. | Misleading | · It is improper to characterize NOVAGOLD’s sale of its interest in the Galore Creek asset as “quiet.” · Dating back to NOVAGOLD’s reorganization in 2012, the Company was always clear about its intention to sell its interest in Galore Creek as part of that reorganization, in order to focus on the Donlin Gold project, announcing in November 2011 that it had retained RBC Capital Markets and JP Morgan Securities LLC as financial advisors for the sale of all or part of its interest in the Galore Creek project. The sale was part of a well communicated strategy by the new management to concentrate its resources on Donlin Gold. In a March 5, 2012 press release, the Company again communicated its intention to sell its interest in the Galore Creek project, adding that the “proceeds from any sale are expected to be applied towards the development of NOVAGOLD’s 50%-owned Donlin Gold project in Alaska.” · When the sale closed, the Company again issued a press release on July 27, 2018 announcing that NOVAGOLD had sold its 50% interest in the Galore Creek project to Newmont for a total consideration of $200-million plus a conditional payment of $75 million. Thus, NOVAGOLD’s interest in the Galore Creek project was sold, as promised, to the right buyer for the right price. The proceeds that have been received were applied, as previously stated, towards advancement of Donlin Gold, NOVAGOLD’s principal asset. · Galore Creek economic parameters were naturally changing with time, scope of and stage of development (study) of the project, which is normal in any project situation. The revised capital cost estimates were made prior to 2011 and not by the present management. No capital cost estimate was performed post 2011. | | --- | --- | --- | --- |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 11 (2) | In short, this is a stock promote, not a mining plan. | False | · See response to 1, 5 above. | | --- | --- | --- | --- | | 12 (3) | NG’s silver-tongued CEO is already preparing the ground for the inevitable pipeline failure by focusing investors on the potential for a higher-grade, smaller mine. | False | · Greg Lang has more than 40 years of industry experience, most of which was spent in increasingly demanding diverse leadership positions overseeing construction and operation of gold mines around the world. · Management remains committed to the original construction plan of the pipeline as appropriate, to the development potential of the Donlin Gold project, and the execution of this plan. · The opportunity to potentially enhance the value of the deposit upfront with higher grade by mining more selectively with smaller equipment and, consequently, spending less money on initial capital has nothing to do with any pipeline. Furthermore, a staged approach to development, while maintaining a substantial portion of gold output, is prudent to investigate ahead of an updated study and development plan. It is unrelated to the pipeline. Management’s intent to explore this alternative has been known to investors for over three years. | | 13 (3) | Management has drilled only 16 holes since 2011 and not even released the modeling results of the last, meager exploratory drill assays in 2017. | False and Misleading | · From 2012 to 2017, while the project was undergoing NEPA review and Federal permitting, exploratory drilling was inadvisable. · Donlin Gold conducted a limited, focused drilling campaign in 2017 to gather additional geochemical and structural data from targeted portions of the defined ACMA and Lewis deposit areas to support ongoing optimization work. · Upon receipt of the assays, the Company disclosed the 2017 drilling results to the public in a press release dated February 20, 2018. · Although NOVAGOLD cannot comment on modeling, grade, or costs until it completes its planned updated feasibility study, the February 20, 2018 press release announcing the results of the drill program included quotes from both Barrick’s President Kelvin Dushnisky and NOVAGOLD’s CEO, Greg Lang, expressing satisfaction with the results of the drill program. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 14 (3) | If the grade had improved, they would be shouting it from the rooftops. | False | · See response to 13 above. | | --- | --- | --- | --- | | 15 (3) | Management’s narrative hasn’t convinced everyone, Barrick (GOLD US), NovaGold’s 50:50 joint-venture partner and the largest gold miner in the world, is so unenthusiastic about the project that Barrick hasn’t included Donlin in its new 10-year program, despite this year’s higher gold price. | Misleading | · Both NOVAGOLD and Barrick have determined that the Donlin Gold project will commence development when the gold price, market conditions and project optimization render it ready for development. · The level of positive attention paid to Donlin Gold by Barrick has been rising steadily, as evidenced in Barrick’s latest AGM presentation. · NOVAGOLD understands that Barrick hasn’t included Donlin Gold in its new 10-year plan because the project owners have not made a construction decision regarding the project. | | 16 (3) | “We’re not changing the rules on this,” Barrick CEO Mark Bristow said on the Q4 earnings call on February 12, 2020 when asked about Donlin. | Misleading | · The quotation attributable to Barrick CEO Mark Bristow is correct but taken out of context. Mr. Bristow stated that the project “offers a huge optionality to the gold price across multiple gold price cycles in an excellent jurisdiction.” | | 17 (3) | The rule Bristow was referring to was Barrick’s estimate of capital costs and return based on a long-term gold price of $1,200 per ounce. | True | | | 18 (3) | Contrast this with Bristow’s comments on Skeena Resources’ (SKE V) Eskay Creek asset, which he characterized as “the value being uncovered by our partners at Eskay Creek in British Columbia.” | True | |

| 9 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 19 (3) | Unlike NovaGold, Skeena’s management team isn’t promotional, which explains why Skeena’s market cap is just one-sixth of NovaGold’s. | False | · Donlin Gold and Eskay Creek (Skeena’s principal development project) are of different sizes and in different stages of development. · The Donlin Gold project has been through several rounds of feasibility studies, whereas the Eskay Creek project is currently at an earlier stage Preliminary Economic Assessment level. · JCAP’s calculation of market capitalization is incorrect: Skeena closed at C$197.5M on May 29, 2020 versus NOVAGOLD’s market cap which was C$4.3B on the same day. Skeena’s market capitalization is one-twentieth of NOVAGOLD’s market capitalization, not one-sixth. | | --- | --- | --- | --- | | 20 (3) | Management’s game is clear: keep investors interested in the stock while they rake in huge salaries. | False | · See response to 2, 5 above. | | 21 (3) | Construction of the Donlin mine was originally expected to start in 2008. Now, 12 years later, management’s best guess is that construction may start in 2022 and production in 2028. | Misleading | · It is true that the original expectation was to start construction in 2008 but it was under different management. New management commenced the permitting process for Donlin Gold in 2012, when FSU2 was also completed. · Moreover, the FSU2, in estimating that pre-production would commence in 2018, disclosed that “Dates [included in the report were] for illustrative purposes only, as no Project permits and approvals [had] been received, and Project development and construction [had] not been approved by the respective Boards of Donlin Gold, NOVAGOLD, and Barrick.” · Bringing a mine into production requires assessment of the macro-economic environment, planning, optimization, research, utilization of possible third-party-financing instruments, conducting of auxiliary studies, and coordination between the partners at Donlin Gold, the experts which they engage, the communities, and government agencies and many other factors too numerous to list; all of these factors must align before a construction decision can be made. · Management’s decision, in conjunction with Barrick, to proceed cautiously, making sure that it has fully planned how it will execute development, is not misleading. It is prudent. |

| 10 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 22 (3) | The icing on the cake? Taking advantage of renewed market enthusiasm due to higher gold prices by cashing equity to the tune of $35 mln, $25 mln of which was in the last 12 months. | False | · JCAP’s statement concerning insider selling improperly conflates the sales of shares by insiders with the exercise of options by insiders. · The current management team has been in place almost eight years and exercised options before they expired (a five-year time limit from the grant date). · According to publicly-available information through Canada’s System for Electronic Disclosure by Insiders (“SEDI”) database, NOVAGOLD’s Vice President and CFO, David Ottewell has steadily increased his shareholdings from 35,000 common shares to 617,000 shares during his tenure. He has surpassed his NOVAGOLD shareholding requirement (of two times his annual salary) 4.8 times over as of November 2019 (the multiple is higher now as his shareholdings have increased and share price has increased). Publicly-filed Form 4 documents show that any stock sales that have been made were part of a stock option exercise transaction, and each time Mr. Ottewell has exercised stock option (which only have value if the share price increases from the date it was granted), the number of shares held has remained the same and not decreased. · According to publicly-available information through Canada’s SEDI database, Greg Lang’s NOVAGOLD shareholdings have steadily increased from 116,000 common shares to 1.83 million shares during his tenure. Mr. Lang has surpassed his NOVAGOLD shareholding requirement (of three times his annual salary) five times over as of November 2019 (the multiple is higher now as his shareholdings have increased and share price has increased). Publicly-filed Form 4 documents show that any stock sales that have been made were part of a stock option exercise transaction, and each time Mr. Lang has exercised stock options (which only have value if the share price increases from the date it was granted) the number of shares held has remained the same or increased, not decreased. | | --- | --- | --- | --- |

| 11 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 23 (4) | Donlin is more an infrastructure project than a mine. | False | · Donlin Gold is not a mine, it’s a mining development project. · A large gold deposit has already been defined as per the FSU2. Donlin Gold hosts measured resources of approximately 8 Mt grading 2.52 g/t and indicated resources of approximately 534 Mt grading 2.24 g/t, each on a 100% basis.^2^ Measured and indicated mineral resources are inclusive of proven and probable reserves. · With 39M oz. of contained gold in measured and indicated resources, Donlin Gold is currently among the largest gold development projects in the world. Gold contained in proven and probable reserves stands at 33.8M ounces. With a proven and probable reserve grade of 2.09 g/t, the project is expected to achieve annual production of 1.5M oz. for first five years and 1.1M oz. over the course of the mine’s life. This production would place Donlin among the highest-producing gold mines in the world and one of the few operators with over 1M oz. of annual capacity.^3^ · The resource model utilized in FSU2 is supported by 1,396 development diamond core and reverse circulation drill holes totaling 339,646 meters, and 282 trenches totaling 21,441 meters. · FSU2 contemplates a project with an estimated mine life of 27 years at 53,500 t/d throughput. | | --- | --- | --- | --- |

________________

^2^ See Note i; Scientific and Technical Information.

^3^ See Note i; Scientific and Technical Information.

| 12 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 24 (4) | The gold is in microscopic deposits in igneous rock. | Misleading | · Gold occurs primarily in sulphide and quartz–carbonate–sulphide vein networks in igneous rocks and, to a much lesser extent, in sedimentary rocks. Broad disseminated sulphide zones formed in igneous rocks where vein zones are closely spaced. Submicroscopic gold, contained primarily in arsenopyrite and secondarily in pyrite and marcasite, is associated with illite–kaolinite–carbonate–graphite-altered host rocks | | --- | --- | --- | --- | | 25 (4) | To power the processing machinery to grind the rock small enough that gold can be chemically leached out, Donlin would require a 220 MW power plant, sufficient to supply electricity to a city of 500,000 people. | Misleading | · As per FSU2, the connected power load planned is 227 MW with an average operating load of 153 MW. The city equivalency is exaggerated and irrelevant. | | 26 (4) | It would be the largest power plant in Alaska and increase the electricity produced in that state by about 40%. | False | · Produced electricity would be based on average operating load. As per the US Dept. of Energy, annual generation in Alaska is 6.9TWh, which equates to just under 800 MW average generation. · Adding 153 MW would increase electricity produced in the State of Alaska by approximately 20%, not 40%. · The Donlin Gold plant would be smaller than Chugach Electric’s Beluga power plant with a total capacity of 332MW – the largest power plant in Alaska. · The development of power generation facilities is not uncommon for large remote mining projects. |

| 13 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 27 (4) | To fuel the power plant, management claim they can build a 316-mile pipeline. | True | | | --- | --- | --- | --- | | 28 (4) | We think it’s a dead letter. | False | · See response to 6–7 above. | | 29 (5) | Management’s biggest misrepresentation is around the cost to build the pipeline. | False | · Management has not made any misrepresentations regarding the cost of the pipeline or other matters. All data has been disclosed and available to the public. · See response to 8 above, 30–39 below. | | 30 (5) | They estimated it would cost $1 bln, or $230,544 per inch/mile (the standard unit for costing pipelines), however we have found that a comparable pipeline (Mackenzie pipeline) was costed out in 2013 for double that price--$471,111—and abandoned in December 2017 after more than a decade of planning and despite all approvals achieved because it was just too expensive to build. | Misleading | · To generate the cost estimate for the pipeline project, CH2M Hill developed two requests for proposal (RFPs): one sent to four pipeline construction firms and one sent to four civil construction firms (for the infrastructure). A number of the firms have extensive Alaskan construction experience. The bids were consolidated and, in general, CH2M Hill took the highest reasonable estimates for each component of each RFP to generate a conservative estimate of cost. · The FSU2 capital cost estimate was developed in accordance with Association for the Advancement of Cost Engineering (AACE) Class 3 requirements. The inputs used to estimate cost are described in detail in the publicly-available FSU2. · The Mackenzie pipeline project used different materials in a different location with a different climate and environmental concerns. It is not an appropriate comparison. · See responses to 36–39 below. · See response to 36–39 below. |

| 14 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 31 (5) | We consulted a pipeline expert who was familiar with the project. | Not Verifiable | · It is not possible to verify whether JCAP’s unidentified pipeline expert is either familiar with the Donlin Gold project or properly credentialed to perform such analysis. | | --- | --- | --- | --- | | 32 (5) | He reluctantly agreed with our view that the cost and difficulty of building the 316-mile pipeline that Donlin’s remote location necessitates makes it improbable it’s a viable option for the company. | Not Verifiable | · It is not possible to verify whether JCAP’s unidentified pipeline expert either agreed with their assessment or is properly credentialed to make such an assessment. | | 33 (5) | We walked him through our assumptions for the pipeline, and he confirmed our rough estimates that the pipeline capex would run 200-400% of management’s forecast. | Not Verifiable | · It is not possible to verify whether JCAP’s unidentified pipeline expert either agreed with their assessment or is properly credentialed to perform such an analysis. | | 34 (5) | Applying the inch/mile costing used on the Mackenzie Pipeline to the Donlin site, we arrive at a capex cost of twice that given by management–$2.09 bln. | Misleading | · The Mackenzie Pipeline is not an appropriate comparison to the Donlin Gold pipeline and JCAP’s measurements relying on this assumption are fundamentally flawed. · See response to 36–39 below. | | 35 (5) | The 750-mile, 30-inch MacKenzie Pipeline was costed at $10.6 bln in December 2013, or an inch/mile cost of $471,111. | True | | | 36 (5) | The inch/mile costing metric eliminates the cost differences between 14 inches and 30 inches. | False | · There are a number of key differences in terms of location, scale, design, and construction requirements between the Mackenzie and Donlin Gold proposed pipelines that can, and would, substantially affect cost. None of these are considered in detail in JCAP’s analysis. · Mackenzie utilized high pressure and heavy wall pipe compared with standard pressure and standard wall pipe for Donlin as per American Petroleum Institute (API) specification 5L, and thicker in areas of geohazards. · Logistics were more difficult in connection with the Mackenzie pipeline. The costs of moving a 30-inch heavy wall pipe compared with a 14-inch standard wall pipe are not linear. Cost increases are significant with increased diameter and weight of pipe. |

| 15 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 37 (6) | The Mackenzie pipeline is useful for comparison because the: Mackenzie River Delta of Canada’s Northwest Territories has a similar climate and geology to the adjacent Alaskan territory and the Donlin project pipeline, albeit milder, with less permafrost. | False | · More than 25% of the Mackenzie route is above the Arctic Circle and it is almost entirely underlain by continuous or extensive discontinuous cold permafrost terrain, compared with sub-Arctic conditions and only about 10% warm permafrost for Donlin. · Mackenzie was a chilled gas pipeline, while Donlin Gold is an ambient temperature pipeline requiring no chillers. The Mackenzie route had colder permafrost that is harder and more expensive to trench. Select backfill must be mined, processed, and imported for permafrost. This is a significant additional cost for Mackenzie, which is larger pipe and had much more permafrost. Cathodic protection in permafrost requires zinc anode in ditch versus impressed current in non-permafrost. · The Mackenzie pipeline construction estimated work in three winters with no significant summer pipeline construction work. The Donlin Gold schedule alternates summer and winter construction for better utilization of resources. | | --- | --- | --- | --- |

| 16 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 38 (6) | In addition to lowballing of cost, we believe that as a result of cost inflation, the pipeline cost could exceed $3.8 bln. | False | · See response to 39 below. | | --- | --- | --- | --- | | 39 (6) | Data from the Interstate Natural Gas Association of America show that costs have risen by 82% since 2012, when the Donlin pipeline was costed out. | Misleading | · See response to 30 above on cost estimates. · JCAP’s source is an Interstate Natural Gas Association of America (INGAA) study of North America Midstream Infrastructure through 2035. · The 82% figure relied on by JCAP is misleading, as the 2012 line U.S. average ($143,000) is more heavily weighted by lower cost regions, as the mean (not weighted average) value shown is $236,000 (65% higher than the weighted average). JCAP misleadingly avoided using escalation multiples from other years with multiples lower than 2012 (for example, 2017). · This means that there was a greater length and/or diameter of pipelines built in this period in the lower cost regions, driving the weighted average cost down. · In the 2020 line, the U.S. average value of $261k includes perceived escalated values from all regions. The mean from the values shown is $326k (25% higher than weighted average), so the weighted average is still influenced more by lower cost regions, but not to the same extent as the 2012 line. · The project-specific estimates and continued reviews that NOVAGOLD has applied to Donlin Gold development costs are more reliable than the broad industry-wide benchmarking and theoretical escalation to which the JCAP Report cites. |

| 17 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 40 (7) | The pipeline would be one of the most difficult ever built, with 95% of the terrain hilly or mountainous. | False | · See response to 5–6 above. · Approximately 25% of the terrain that the pipeline would cover is rugged mountainous terrain. More than half is comprised of lowlands or rolling terrain. | | --- | --- | --- | --- | | 41 (7) | The pipeline route is frozen for seven months of the year, and the discontinuous permafrost creates engineering complexity, as the ground in spring turns to wetlands and bogs the machinery. | Misleading | · The frozen terrain will facilitate work for the pipeline in certain areas, specifically work in the Cook Inlet region and other lowland areas, which will be conducted during the winter months to avoid issues with the terrain and equipment. · All of this is well documented on a mile-by-mile basis in the Donlin Gold Pipeline Plan of Development prepared by SRK based on CH2M Hill’s design work. · Michael Baker International, an experienced pipeline company in Alaska and other northern climates, has also supported the design work in the area with mountainous terrain, which has the most permafrost, for the Pipeline and Hazardous Materials Safety Administration (PHMSA) Special Permit that was issued in 2018. The Special Permit provides for the use of Strain-based Design that is specifically tailored to facilitate pipeline construction and operations in permafrost conditions. | | 42 (7) | Each of 300 stream crossings will require a temporary bridge, and dam, and two pits, one on either side of the stream, for the drilling equipment to bore a hole under the stream. | False | · About 7, not 300, stream crossings are proposed for horizontal directional drilling. · The balance of the stream crossings generally only require open cut methods. · No drilling equipment is required to “bore a hole under the stream” for these other 293 crossings |

| 18 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 43 (7) | The estimated construction time is three to four years. | Partially True | · Donlin Gold estimates a 2 to 3 year pipe installation schedule within a 3 to 4 year overall project schedule for construction which would include infrastructure build out, pipe installation and ROW stabilization, rehabilitation and reclamation work concurrent and immediately following pipe installation all of which would be time dependent on actual receipt of permits and authorization to proceed with construction of the pipeline. | | --- | --- | --- | --- | | 44 (8) | The expert we spoke with confirmed “There isn’t a lot of contractor/industry experience anywhere for the permafrost and environmental issues you might encounter.” | False | · See response to 5–6, 41 above. | | 45 (8) | There are also changes that will need to be made for environmental reasons that have not been included in pipeline estimates, and those changes will add cost. | Misleading | · See response to 5–6, 29, 41–42 above. | | 46 (8) | The mine’s own feasibility study stated that the accuracy of the capital cost estimate is considered to be between -15% and 30%. | True | · The FSU2 capital cost estimate was developed in accordance with Association for the Advancement of Cost Engineering Class 3 requirements. | | 47 (8) | But mines are never built for less; they are always built for more. | False | · The EY Report to which JCAP cites states that 31% of projects during the reported timeframe delivered in line with their cost. · As mines can experience cost overruns, the Company actively collects and considers data and other relevant information derived from such other projects in order to minimize the potential for cost overruns in the development of the Donlin Gold project. | | 48 (8) | Mining construction projects on average have cost overruns of 62%, according to a survey by Ernst and Young. | Misleading | · The EY Report cites assets from a sample project group unrelated to Donlin Gold. · The report cites “enablers” for preventing cost and schedule overruns, including flagging of emerging risks, adequate cost and time contingencies, and scenario planning. The studies and planning supporting the Donlin Gold cost estimates are consistent with the “enablers” cited in the report. |

| 19 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 49 (9) | Likely preparing investors for the inevitable “pivot” when it becomes clear that the pipeline won’t work, the management team started to claim they could solve the power issue by barging diesel 194 miles up the Kuskokwim River. | False | · Barging diesel is not a “pivot.” It was always a part of the mine plan, and it was detailed extensively in FSU2. | | --- | --- | --- | --- | | 50 (9) | This looks even less plausible than the pipeline, according to data buried in the feasibility study. | False | · JCAP’s analysis on the plausibility of barging diesel is faulty because it is based on the presumption that Donlin Gold would only use diesel fuel. · The project has always envisioned barging diesel, along with other materials and equipment, to the site. | | 51 (9) | Even if NovaGold reduced the mine capacity by half, it could not barge enough diesel to operate the power plant. | False | · This mine can be built without a gas pipeline. · The current plan is to use natural gas as fuel for the power plant with the option of diesel as an emergency backup in the event of an interruption to the gas supply. Barging of diesel for mining equipment is in the current plan. With an increase in barge tows, a larger quantity of diesel could be transported by river. · See response to 50 above. | | 52 (9) | The current mine configuration would require 1.1 ML (Mega Liters or 1 mln liters) of diesel per day or 403 ML per year to fuel the power plant. | True | · See response to 50 above. | | 53 (9) | The total diesel that can be barged up the river is at best 253 ML. | False | · The JCAP Report misleadingly relies on the planned number of barge trips from FSU2 but assumes that the plant would use 100% diesel. If the plant needed to be operated entirely on diesel, the barge capacity could be increased. · See response to 50 above. |

| 20 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 54 (9) | The mine vehicles alone would consume 151 ML per year. | True | · See response to 50 above. | | --- | --- | --- | --- | | 55 (9) | The Donlin Mine has been granted environmental approval for 58 round trips by fuel barges per year of operation. | True | · See response to 50, 53 above. | | 56 (9) | Given restrictions imposed by river flow, each fuel barge trip could transport on average around 4.2 ML. | False | · See response to 53 above. | | 57 (9) | After mine vehicle use, that would leave enough diesel to power the plant for between 67 and 93 days. | Misleading | · See response to 50, 53 above. | | 58 (9) | Under the most optimistic scenario, cutting production to half of what is now planned, the diesel barged in would be sufficient for at most seven months of operations per year, essentially reducing output to a quarter of what is now planned. | False | · See response to 50, 53 above. | | 59 (10) | Investors shouldn’t be surprised with the narrative change. | False | · There has been no narrative change. The Company’s message has been consistent all along. · See response to 49–50 above. | | 60 (10) | For years, NG management has been trying to find a way around the fundamental problem of getting energy to the site. | Misleading | · NOVAGOLD and Barrick have always considered different options to bring power to the Donlin site. · Bringing power to the site is not a “problem,” let alone a “fundamental” one. | | 61 (10) | They have floated the idea of a coal-fired plant, wind turbines–even biomass. | Misleading | · In addition to being prudent, the National Environmental Protection Act (NEPA) and Environmental Impact Statement (EIS) process required Donlin Gold to consider, and it has considered, a wide array of alternative development options for fuel sources and power generation, including renewable sources and coal. | | 62 (10) | In the earliest days of the mine, it was to be grid-connected by a power line that would take three years to connect. | Misleading | · See response to 61 above. · NOVAGOLD and Barrick determined that a transmission line from the grid was not a feasible energy source and did not include planning for a transmission line in FSU2. NEPA also required that Donlin Gold consider alternative energy sources as part of the permitting process. |

| 21 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 63 (10) | The only problem was the grid they were planning to connect to did not have the power to supply the project. | Misleading | · See response to 61–62 above. | | --- | --- | --- | --- | | 64 (10) | Then they tried coal. | Misleading | · See response to 61 above. | | 65 (10) | The coal power was to be from a new mine-mouth power plant in Healy. | Misleading | · See response to 61 above. | | 66 (10) | Our favorite idea was the possibility of using peat near the mine. | Misleading | · See response to 61 above. | | 67 (10) | Wind power was considered for 20% of the mine’s power needs in 2006 and diesel for the balance. | Misleading | · See response to 61 above. | | 68 (10) | “We have gone with on-site diesel power with wind cogeneration,” said the CEO on February 24, 2009.” | Misleading | · See response to 61 above. · It is misleading and inappropriate to quote the statement of a former Company CEO made 11 years ago regarding the source of on-site power supply which was made prior to the publication of the FSU2. | | 69 (11) | With all permits for Donlin secured and close to all-time high gold prices, management is stalling for time: investors are being asked to wait for another feasibility study. | False and Misleading | · JCAP’s statement is incorrect. Management is not stalling for time. It repeatedly stated that there is no rush to advance towards construction when the partners are not fully ready for it. · See response to 21 above. | | 70 (11) | Management is dangling the idea that there might be an even bigger mine and richer deposits, even though Donlin already has a large enough reserve for 27 years of mine life: | Misleading | · See response to 12 above. | | 71 (11) | “There are clearly opportunities for expansion of the resource.” CEO Greg Lang, January 23, 2020. | True | |

| 22 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 72 (11) | “[T]here are clearly significant future opportunities for substantial expansion of the resource. When the time is right, we will resume exploration.” Greg Lang, October 2, 2019. | True | | | --- | --- | --- | --- | | 73 (11) | “While the Donlin Gold deposit is well known, there are future opportunities for additional drilling and expansion of the resource.” Greg Lang, June 27, 2019. | True | | | 74 (11) | Actually, NG’s own study showed disappointing results after the very limited foray beyond the main mining area, back in the 1990s. | False | · Ownership of the Donlin Gold asset has changed several times since the 1990s, and new studies of areas of opportunity have been conducted. JCAP does not identify the study to which it is referring, and, in any event, the results of a study conducted nearly three decades ago under different ownership and management do not reflect the Company’s current development plans or the current market, engineering, commercial, and environmental conditions affecting the project. | | 75 (11) | Since 2011 they have drilled only 7,040 meters, 16 drill holes, which runs counter to the idea that they are interested in exploring a larger ore body. | Misleading | · From 2012 to 2017, exploratory drilling was inadvisable while the project was undergoing NEPA review and Federal permitting. · Donlin Gold conducted a limited, focused drilling campaign in 2017 to gather additional geochemical and structural data from targeted portions of the defined ACMA and Lewis deposit areas to support ongoing optimization work. · NOVAGOLD’s current focus is confirming recent modeling concepts to proceed with development. In-fill drilling that it conducts in pursuit of that goal does not speak to the Company’s view on the viability of other potential targets. · See response to 13 above. |

| 23 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 76 (11) | Given the enormous technical complexity of constructing the pipeline and the impossibility of barging enough oil to power the project, management likely knows that the project isn’t feasible, which is why executives are evasive when analysts attempt to pin them down on timing for further development. | False | · Management has always been clear and direct with the facts, which are publicly-known. · See response to 3, 5–6 above. | | --- | --- | --- | --- | | 77 (12) | Comments by Thomas Kaplan: “My sense is that the moment will come in a not dissimilar way to the way that Justice Potter Stewart when answered the question, “How do you define pornography? I can’t define it, but I know it when I see it.” April 2, 2020. | True | | | 78 (12) | “[W]e’ve always said that the time to build Donlin [is] extrinsic of the studies that are being done and optimizations and drilling and the partner is all being ready to go, extrinsic of that.” April 2, 2020. | True | | | 79 (12) | “You know our strategy is not to make any wine before its time. A wise man once told me that these kinds of assets are rarer than hens’ teeth.” October 3, 2018. | True | | | 80 (12) | This would trouble us less if the story hadn’t continually changed for 15 years. | False and Misleading | · It is false and misleading to conflate two eras of management over the past fifteen years into one. The present management team has been leading NOVAGOLD for the past eight years. · Current management has been completely transparent as to the strategy since 2012. It stands by that strategy. · NOVAGOLD’s disclosures to the public accurately reflect the data and information the Company has acquired. Company management remains committed to the Donlin Gold project and to the extensive technical work completed by well-qualified firms retained by NOVAGOLD in connection with the project. |

| 24 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 81 (12) | In fact, construction of the Donlin mine was originally expected to start in 2008. | False | · It is false and misleading to conflate two eras of management over the past fifteen years into one. The present management team has been leading NOVAGOLD for the past eight years. · Current management has been completely transparent as to the strategy since 2012. It stands by that strategy. | | --- | --- | --- | --- | | 82 (12) | Now, 12 years later, management’s best guess is that construction might start in 2022 and production in 2028. | False | · NOVAGOLD has no record of making this statement. | | 83 (13) | To give you a better idea of the ever-changing narrative, we have produced a timeline of the last 15 years. | Misleading | · JCAP’s chart of accusations about management is misleading and distorts the facts. Specifically, it attributes all quotes to NOVAGOLD’s “CEO,” without distinguishing between previous management and current management. · JCAP’s chart cites to estimates provided before the completion of the FSU2. | | 84 (13) | Chart 5: Management Claims “We start construction at Donlin Creek in 2008.” – CEO Mar, 2 2006. | Misleading | · It is false and misleading to conflate two eras of management over the past fifteen years into one. The present management team has been leading NOVAGOLD for the past eight years. · JCAP’s chart of management claims is misleading and distorts the fact. Specifically, it attributes all quotes to NOVAGOLD’s “CEO,” without distinguishing between previous management and current management. · Since the Donlin Creek LLC was formed in late 2007, NOVAGOLD and Barrick have been working closely to review the optimal project scale and power configuration. Under the direction of the Donlin Creek LLC management team, a variety of studies designed to consider the optimal mill throughput and power configuration, in light of the expanding resource base are now underway and it is NOVAGOLD and Barrick’s joint objective to identify a development plan which will maximize the project’s value while at the same time designing it to minimize the time required for environmental permitting. |

| 25 |

| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 85 (13) | Chart 5: Management Claims “construction targeted for 2012.” – 6K Sep 30, 2008 | True | | | 86 (13) | Chart 5: Management Claims “Looking at it sort of 2013 for construction and then Donlin probably a year or two later.” – CEO Jul 19, 2010 | True | | | 87 (13) | Chart 5: Management Claims “It’s been over 20 years to get Donlin to a point where it’s at now, which is on the cusp of a construction decision.” – CEO May 15, 2017 | True | · This statement is taken out of context and discusses the time including the level of technical, financial, environmental and social work needed to properly advance such an important project. | | 88 (13) | This shape shifting repeats a familiar pattern for NG. | False | · There is no “shape shifting.” Management has been consistent in its reliance on the extensive engineering and technical work conducted to plan for the Donlin Gold project, which is documented in FSU2. · See response to 90–106 below. | | 89 (13) | In the past decade, NovaGold feverishly talked up two other assets, only to spin off or sell them at a loss. | Misleading | · See response to 90–106 below. | | 90 (13) | Before the first asset, NovaCopper, was spun out, in 2012, management promoted it with the same vigor as it now promotes Donlin: | Misleading | · The spinout of NovaCopper generated value for NOVAGOLD shareholders. · Since its formation, NovaCopper has progressed both of its projects, Arctic and Bornite, supported State permitting of an important road to the region designed to facilitate project development, and secured a partnership arrangement with South 32, one of the largest and most respected mining companies in the world. · Trilogy Metals, formerly known as NovaCopper, has a market cap of approximately C$370 million. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 91 (13) | “On our Ambler project [NovaCopper], this is a really exciting project. You can see the metal count here, there are very few deposits in the world of this caliber.” | True | | | 92 (14) | “There aren’t a lot of comparable really to Ambler. It’s such a spectacular grade for a volcanogenic massive sulphide deposit that there really aren’t a lot of comparable to it.” | True | | | 93 (14) | By the end of that year, NG had spun out NovaCopper. | True | | | 94 (14) | Now trading as Trilogy Metals (TMQ CN), its shares have slumped 32% since divestiture. | Misleading | · It is inaccurate and misleading to suggest that the Trilogy Metals stock “slumped” since the spin out because the Trilogy Metals stock did not exist prior to that. | | 95 (14) | NG’s promotional management team held out the second asset, Galore Creek, as the key project to finance the development of other deposits. | Misleading | · It is false and misleading to conflate two eras of management over the past fifteen years into one. The present management team has been leading NOVAGOLD for the past eight years. · See response to 96–105 below. | | 96 (14) | With 8 mln ounces of gold and 9 bln pounds of copper, Galore was sold to Newmont (NEM US) in July 2018 for $80 mln less than NG had spent on development; NG took a loss on the sale. | Misleading | · The references here are regarding the book value, but book value of the Galore Creek asset is not relevant. The substantial funds generated by the sale of Galore Creek provided NOVAGOLD with significant capital to advance the Donlin Gold project, accruing significant additional value to shareholders. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 97 (14) | The $275 mln consideration included $75 mln contingent on production, which is so unlikely that NG is not accounting for it. | Misleading | · The likelihood or not of a construction decision on Galore Creek, which would be one of the largest copper producers in Canada, is better to be addressed by Teck and Newmont. · For accounting purposes, contingent assets require a high level of certainty to be recognized. The contingent note will be recognized when, in management’s judgment, it is probable that the payment will occur, and that the amount recorded will not reverse in future periods. | | 98 (14) | Newmont quietly shut the project down on April 28, 2020. | Misleading | · The Galore Creek Mining Corporation announced that “due to the COVID-19 pandemic and the resulting economic uncertainties faced by the mining industry, expenditures on the Galore Creek project have been reduced in 2020, deferring the start of the planned Prefeasibility Study.” | | 99 (15) | The Galore Creek story bears striking similarities to the problems we have identified at Donlin. | False | · See response to 100–112 below. | | 100 (15) | It is a textbook case of disastrous feasibility studies and enormous understatement of capital required. | False | · The Galore Creek Feasibility Study estimates were impacted by large, unpredictable industry and market conditions changing over a period of 15 years that affected the amount of capital required to complete the project. | | 101 (15) | In 2004, NG reported that capital costs would be $0.8 bln. | True | · It is false and misleading to conflate two eras of management over the past fifteen years into one. The present management team has been leading NOVAGOLD for the past eight years. · See response to 100 above. | | 102 (15) | In 2006, the estimate more than doubled to $2.2 bln. | True | · It is false and misleading to conflate two eras of management over the past fifteen years into one. The present management team has been leading NOVAGOLD for the past eight years. · See response to 100 above. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 103 (15) | In 2011, estimated costs doubled again, to $5.2 billion. | True | · It is false and misleading to conflate two eras of management over the past fifteen years into one. The present management team has been leading NOVAGOLD for the past eight years. · See response to 100 above. | | 104 (15) | The mine showed a greater than 500% increase in capital costs in just seven years. | True | · It is false and misleading to conflate two eras of management over the past fifteen years into one. The present management team has been leading NOVAGOLD for the past eight years. · See response to 100 above. | | 105 (15) | The same mining service company that produced the Donlin Feasibility Study, AMEC, completed the study of Galore Creek. | False | · AMEC did not produce the October 2006 Galore Creek Feasibility Study upon which the construction decision was based. · The Galore Creek feasibility study is representative of a point in time. The ultimate change in estimated capital was impacted by large and unpredicted industry and market trends. Company management is unaware of any current information suggesting that similar trends or market changes will impact the estimated cost to develop the Donlin Gold project. · In April 2007, NOVAGOLD retained AMEC to review the October 2006 Galore Creek Feasibility Study. The review covered the entire project with a focus on construction of the mine facilities and tailings and water management structures. By mid-October 2007, AMEC’s preliminary work indicated it expected capital costs would be significantly higher than originally estimated, at which time the owners of Galore Creek commenced a project strategy review, involving seven engineering teams, to assess the AMEC work. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 106 (15) | Management continually and deliberately misleads investors on capital costs for Donlin. | False | · Since publishing the FSU2, management has consistently reported initial capital costs of $6.7 billion—the amount documented in and supported by the FSU2. Other costs, including sustaining capital, are likewise well-documented and consistent. | | 107 (15) | Read any company report, presentation, or transcript over the last 10 years and you will see “Total Project Cost” of $6.7 bln to build the mine. | True | · This is the initial capital cost from FSU2, the last feasibility study completed on the Donlin Gold project. | | 108 (15) | Yet the company appears to be misrepresenting cost in the above presentation. | False | · The FSU2 capital cost estimate was developed in accordance with Association for the Advancement of Cost Engineering Class 3 requirements. · Initial capital requirement as per the FSU2 is $6.7 billion. · The $8 billion figure referenced by JCAP in FSU2 includes operating costs as required under U.S. Generally Accepted Accounting Principles (US GAAP). It is noted in FSU2 to reconcile the accounting treatment of mine stripping costs incurred in the production phase of a mine between US GAAP and International Financial Reporting Standards (IFRS). Under IFRS, these costs can be capitalized and reported as sustaining capital. Capitalization of these costs is not allowed under US GAAP and are expensed as operating costs. In either case, the expenditures are not initial capital and there is no impact on the timing of project cash flows or net present value. | | 109 (15) | The most recent feasibility study, done in 2012, estimated that the initial capex alone, is $8 bln, not $6.7 bln. | False | · The FSU2 capital cost estimate was developed in accordance with Association for the Advancement of Cost Engineering Class 3 requirements. · Initial capital requirement as per the FSU2 is $6.7 billion. · The $8 billion figure referenced by JCAP in FSU2 includes operating costs as required under U.S. Generally Accepted Accounting Principles (US GAAP). It is noted in FSU2 to reconcile the accounting treatment of mine stripping costs incurred in the production phase of a mine between US GAAP and International Financial Reporting Standards (IFRS). Under IFRS, these costs can be capitalized and reported as sustaining capital. Capitalization of these costs is not allowed under US GAAP and are expensed as operating costs. In either case, the expenditures are not initial capital and there is no impact on the timing of project cash flows or net present value. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 110 (15) | This extra initial capex cost was buried inside the Second Updated Feasibility study (February 2012) as a single line in the projected cash flow statements, not defined anywhere else in the report, and called “IFRS Total Capitalized Opex (Sustaining Capital).” | False | · The FSU2 capital cost estimate was developed in accordance with Association for the Advancement of Cost Engineering Class 3 requirements. · Initial capital requirement as per the FSU2 is $6.7 billion. · The $8 billion figure referenced by JCAP in FSU2 includes operating costs as required under U.S. Generally Accepted Accounting Principles (US GAAP). It is noted in FSU2 to reconcile the accounting treatment of mine stripping costs incurred in the production phase of a mine between US GAAP and International Financial Reporting Standards (IFRS). Under IFRS, these costs can be capitalized and reported as sustaining capital. Capitalization of these costs is not allowed under US GAAP and are expensed as operating costs. In either case, the expenditures are not initial capital and there is no impact on the timing of project cash flows or net present value. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 111 (16) | We believe that excluding this additional cost was a deliberate attempt to mislead the market, because capitalized opex was included in the capital costs to build the mine in the first feasibility study in 2009. | False | · The FSU2 capital cost estimate was developed in accordance with Association for the Advancement of Cost Engineering Class 3 requirements. · Initial capital requirement as per the FSU2 is $6.7 billion. · The $8 billion figure referenced by JCAP in FSU2 includes operating costs as required under U.S. Generally Accepted Accounting Principles (US GAAP). It is noted in FSU2 to reconcile the accounting treatment of mine stripping costs incurred in the production phase of a mine between US GAAP and International Financial Reporting Standards (IFRS). Under IFRS, these costs can be capitalized and reported as sustaining capital. Capitalization of these costs is not allowed under US GAAP and are expensed as operating costs. In either case, the expenditures are not initial capital and there is no impact on the timing of project cash flows or net present value. | | 112 (17) | “The total estimated cost to design and build the Project … [includes] an Owner-provided mining fleet and self-performed pre-production mine development.” | True | . | | 113 (17) | NovaGold management might have the cushiest job in mining. | False | · NOVAGOLD’s management continues to work diligently to plan the development of the Donlin Gold project and produce value for its shareholders. · See response to 114-120 below. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 114 (17) | Despite the limited progress (the last feasibility was produced in 2012) the CEO has awarded himself $8.3 mln in cash compensation over the last five years plus over 1.8 mln shares. | False and Misleading | · Compensation of NOVAGOLD management is established by the Compensation Committee of the Board and is duly approved by the entire Board. It is regularly measured against levels of compensation of management of a carefully selected peer group of companies. · It is not true to say that there has been limited progress in the last 5 years. The absence of active construction does not mean that significant progress toward the development of the project has not been made during this time. Over this time, the Company has completed federal permitting, including the Environmental Impact Statement and joint Corps of Engineers and BLM Record of Decision, advanced continued optimization efforts and conducted additional research to support a new feasibility study—prudent steps before commencing construction. · See responses to 2, 22 above. | | 115 (17) | Senior office holders and directors have taken $35 mln in net cash from share sales in the last five years. | False | · JCAP’s statement concerning insider selling improperly conflates the sales of shares by insiders with the exercise of options by insiders. · See response to 22 above. | | 116 (17) | The CEO’s total compensation rivals that of the two largest mining companies in the world, BHP, with 72,000 employees, and RIO, with 47,000. | False | · See response to 22 above. · BHP and RIO are not considered peers as they are not in the gold mining business | | 117 (18) | Some 70% of NG insider share sales were over the last 12 months, as the share price increased by 300%. | False | · See response to 22 above and 120 below. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 118 (18) | The CFO’s stock in the company has halved, from around 2.2 mln shares to 1mln. | False | · According to publicly-available information through Canada’s System for Electronic Disclosure by Insiders (“SEDI”) database, NOVAGOLD’s Vice President and CFO, David Ottewell has steadily increased his shareholdings from 35,000 common shares to 617,000 shares during his tenure. He has surpassed his NOVAGOLD shareholding requirement (of two times his annual salary) 4.8 times over as of November 2019 (the multiple is higher now as his shareholdings have increased and share price has increased). Publicly-filed Form 4 documents show that any stock sales that have been made were part of a stock option exercise transaction, and each time Mr. Ottewell has exercised stock option (which only have value if the share price increases from the date it was granted), the number of shares held has remained the same and not decreased. | | 119 (18) | The CEO has reduced his net position by 26%. | False | · According to publicly-available information through Canada’s SEDI database, Greg Lang’s NOVAGOLD shareholdings have steadily increased from 116,000 common shares to 1.83 million shares during his tenure. Mr. Lang has surpassed his NOVAGOLD shareholding requirement (of three times his annual salary) five times over as of November 2019 (the multiple is higher now as his shareholdings have increased and share price has increased). Publicly-filed Form 4 documents show that any stock sales that have been made were part of a stock option exercise transaction, and each time Mr. Lang has exercised stock options (which only have value if the share price increases from the date it was granted) the number of shares held has remained the same or increased, not decreased. | | 120 (18) | Clearly, the insiders have voted with their feet. | False | · See response to 22 above. · Table 4 purporting to document insider share sales is inaccurate. David Deisley—identified as a “Director”—retired more than a year ago and never served as a director. · None of the other identified individuals have sold shares of the company in the most recent 12 months other than in connection with a stock option exercise, which does not result in a net decrease in shares owned. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 121 (18) | Aware of how unattractive an investment proposition has been offered, NovaGold since early 2018 has been pushing mine “optimization.” | False and Misleading | · Optimization work is the prudent approach for any mining company looking at development of a mine. Given the extensive studies and engineering completed to date, the in-fill drilling data from the 2017 and 2020 drilling program currently underway, will lead to a more robust undertaking based on solid technical information as we continue to advance Donlin Gold. · See response to 3, 23 above. | | 122 (18) | Optimization means halving production capacity to reduce capex expenditure by 40% and drilling to identify higher-grade deposits to compensate for the loss of scale. | Misleading | · The Company does not agree with this definition of “optimization.” | | 123 (19) | “As part of our ongoing optimization work, we’ve studied more selective mining methods as a means of enhancing the grade,” CEO Greg Lang said in a January 25, 2018 call. | True | | | 124 (19) | But management clearly knows there is no optimization to be had. | False | · See response to 125–126 below. | | 125 (19) | Management is drilling very selectively in hopes of finding a deposit, no matter how small, with higher-than-average purity. | False | · The drilling referenced by JCAP’s statement is not being conducted to find “a deposit.” A large gold deposit has already been defined as per the Donlin Gold FSU2 and as determined by past drilling and modeling. The current drilling is being conducted to additional geochemical and structural data from targeted portions of the defined ACMA and Lewis deposit areas to support ongoing optimization work. · The latest 2020 in-fill drilling program (which means it is in the ACMA and Lewis deposit) is being done to confirm recent geologic modeling concepts, as well as enhance certain portions of the deposit, notably where there exists limited drilling (and thus limited modeled gold grades). · See response to 13 above. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 126 (19) | Most recently, in 2017, the company drilled a mere 16 drill holes or 1.1% the number of holes that had originally been used to determine the grade of the resource. | True | | | 127 (19) | Yet NovaGold has been silent on the results even of this cherry-picked study. | False | · See response to 13 above. | | 128 (19) | Clearly the grade did not improve from this drilling. | Misleading | · See response to 13 above. | | 129 (19) | After the 2017 assay, the CEO sold down $2.5 mln in stock. | False | · See response to 22 above. | | 130 (19) | Nevertheless, the CEO on January 23, 2020 told analysts: ‘So we think there’s opportunity to – through higher grade offset some of the economies of scale we lose.” | True | | | 131 (19) | The $15.4 mln managers have paid themselves in cash compensation would have bought investors 80 exploration drill holes rather than the 16 drilled. | Misleading | · Management does not compensate itself. · Compensation of NOVAGOLD management is established by the Compensation Committee of the Board and is duly approved by the entire Board. It is regularly measured against levels of compensation of management of a carefully selected peer group of companies. · The two issues are not related. If Management thought that it was prudent to drill 80 holes, it would have. | | 132 (19) | It could have paid for a new feasibility study into a downsized mine capacity with more affordable capex. | Misleading | · The two issues are not related. If Management thought that it was prudent to conduct a new feasibility study into a downsized mine capacity, it would have. |

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| --- | | Sentence | Statement | Response | Factual Support | | --- | --- | --- | --- | | 133 (19) | Management paid themselves instead, because they knew no new drilling or resizing of the mine will make a difference. | Misleading | · Management does not compensate itself. · Compensation of NOVAGOLD management is established by the Compensation Committee of the Board and is duly approved by the entire Board. It is regularly measured against levels of compensation of management of a carefully selected peer group of companies. · The two issues are unrelated. If Management thought that it was prudent to conduct a new feasibility study into a downsized mine capacity, it would have. | | 134 (19) | We actually expect the grade to decline by 5-7% with better modeling of the resource based on estimates in the company’s feasibility study: | Misleading | · The JCAP report omits that the FSU2 report discloses that this concern was addressed in model post-processing. | | 135 (20) | Seabridge (SA US) is a comparable mine in Northwest British Columbia adjacent to Alaska. | False | · Seabridge is not a mine, it is a development mining company. The report likely intends to refer to KSM, which is a mining development project. · KSM is a polymetallic deposit containing copper, gold, and silver and is not a comparable project. Its revenue will depend on the price of metals not considered in the Donlin Gold valuation. | | 136 (20) | Seabridge is close to a grid connection powered by cheap hydropower. | | · No comment. | | 137 (20) | Seabridge has a lower capital cost and higher NPV than Donlin and is still not funded. | Misleading | · JCAP does not provide any sources or references for the assets listed. · JCAP quotes Net Present Value (NPV) without stating a discount rate. | | 138 (20) | Market cap is less than one fifth that of NG—and Seabridge owns the whole mine. | | · No comment |

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| --- | | Sentence | Statement | Factual Support | | --- | --- | --- | | 139 (20) | SolGold (SOLG LN), which owns the Cascabel mine in Ecuador has a higher country risk, but capital costs per unit of annual output and capital to NPV ratio are far better. | · JCAP quotes Net Present Value (NPV) without stating a discount rate. · The Cascabel project is different in terms of development stage, scale, and jurisdiction. It is not an appropriate point of comparison. | | 140 (20) | The company also has a very low market cap given the better metrics and NPV. | · No comment. | | 141 (20) | Newcrest Mining (NCM AU) acquired Red Chris from Imperial Metals (III CN) for 804 mln for 70% of an operating mine with the equivalent resources of 26 mln oz of gold. | · No comment. | | 142 (20) | That values an operating mine at 1.15 bln with a similar resource as Donlin and no start-up capital required. | · No comment. | | 143 (20) | NovaGold has managed to snag its valuation strictly through enthusiastic deception. | · NOVAGOLD is valued on many parameters having to do with it being “a Tier 1 asset in a Tier 1 jurisdiction with a proven management team. | | 144 (20) | We encourage serious investors not to take the bait. | · JCAP’s recommendation is founded only on distortions and references to anonymous sources. It is contrary to years of well-documented expert research. |

All values are in US Dollars.

_________________

^i^ Scientificand Technical Information. Some scientific and technical information contained herein with respect to the Donlin Gold projectis derived from the “Donlin Creek Gold Project Alaska, USA NI 43-101 Technical Report on Second Updated Feasibility Study”prepared by AMEC with an effective date of November 18, 2011, as amended January 20, 2012 (the “Second Updated FeasibilityStudy”). Kirk Hanson, P.E., Technical Director, Open Pit Mining, North America, (AMEC, Reno), and Gordon Seibel, R.M. SME,Principal Geologist, (AMEC, Reno) are the Qualified Persons responsible for the preparation of the independent technical report,each of whom are independent “qualified persons” as defined by NI 43-101. Clifford Krall, P.E., who is the Mine EngineeringManager for NOVAGOLD and a “qualified person” under NI 43-101, has approved and verified the scientific and technicalinformation related to the Donlin Gold project contained in this document.

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Cautionary Note Regarding Forward-LookingStatements. This press release includes certain “forward-looking information” and “forward-looking statements”(collectively “forward-looking statements”) within the meaning of applicable securities legislation, including theUnited States Private Securities Litigation Reform Act of 1995. Forward-looking statements are frequently, but not always, identifiedby words such as “expects”, “anticipates”, “believes”, “intends”, “estimates”,“potential”, “possible”, and similar expressions, or statements that events, conditions, or results “will”,“may”, “could”, “would” or “should” occur or be achieved. Forward-looking statementsare necessarily based on several opinions, estimates and assumptions that management of NOVAGOLD considered appropriate and reasonableas of the date such statements are made, are subject to known and unknown risks, uncertainties, assumptions and other factors thatmay cause the actual results, activity, performance or achievements to be materially different from those expressed or impliedby such forward-looking statements. All statements, other than statements of historical fact, included herein are forward-lookingstatements. These forward-looking statements include statements regarding the potential development and construction of DonlinGold; perceived merit of properties; the advancement of optimization studies at Donlin Gold; potential opportunities to enhanceor maximize the value of Donlin Gold; the timing and likelihood of permits; mineral reserve and resource estimates; work programs;capital expenditures; timelines; strategic plans; and benefits of the Donlin Gold project, market prices for precious metals andpotential actions against or redress from JCAP. In addition, any statements that refer to expectations, intentions, projectionsor other characterizations of future events or circumstances are forward-looking statements. Forward-looking statements are nothistorical facts but instead represent NOVAGOLD’s management expectations, estimates and projections regarding future eventsor circumstances on the date the statements are made.

Important factors that could cause actual results to differ materiallyfrom expectations include the need to obtain additional permits and governmental approvals; the timing and likelihood of permits;the need for additional financing to explore and develop properties and availability of financing in the debt and capital markets;the outbreak of the coronavirus global pandemic (COVID-19); uncertainties involved in the interpretation of drilling results andgeological tests and the estimation of reserves and resources; the need for continued cooperation between NOVAGOLD and BarrickGold Corp. for the continued exploration, development and eventual construction of the Donlin Gold property; the need for cooperationof government agencies and native groups in the development and operation of properties; risks of construction and mining projectssuch as accidents, equipment breakdowns, bad weather, natural disasters, climate change, non-compliance with environmental andpermit requirements, unanticipated variation in geological structures, ore grades or recovery rates; unexpected cost increases,which could include significant increases in estimated capital and operating costs; fluctuations in metal prices and currency exchangerates; whether a positive construction decision will be made regarding Donlin Gold; continuing legal review of statements by JCAP;and other risks and uncertainties disclosed in reports and documents filed by NOVAGOLD with applicable securities regulatory authoritiesfrom time to time. The forward-looking statements contained herein reflect the beliefs, opinions and projections of NOVAGOLD onthe date the statements are made. NOVAGOLD assumes no obligation to update the forward-looking statements of beliefs, opinions,projections, or other factors, should they change, except as required by law.

Cautionary Note to United StatesInvestors. This press release has been prepared in accordance with the requirements of the securities laws in effect inCanada, which differ from the requirements of U.S. securities laws. Unless otherwise indicated, all resource and reserve estimatesincluded in this press release have been prepared in accordance with Canadian National Instrument 43-101 Standards of Disclosurefor Mineral Projects (“NI 43-101”) and the Canadian Institute of Mining, Metallurgy and Petroleum (CIM)—CIMDefinition Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as amended (“CIM DefinitionStandards”). NI 43-101 is a rule developed by the Canadian Securities Administrators which establishes standards for allpublic disclosure an issuer makes of scientific and technical information concerning mineral projects. Canadian standards, includingNI 43-101, differ significantly from the requirements of the United States Securities and Exchange Commission (SEC) Industry Guide7 (“SEC Industry Guide 7”), and resource and reserve information contained herein may not be comparable to similarinformation disclosed by U.S. companies. NOVAGOLD’s disclosure concerning Reserve & Resources Estimates remains consistentwith NI 43-101. Under SEC Industry Guide 7, mineralization may not be classified as a "reserve” unless the determinationhas been made that the mineralization could be economically and legally produced or extracted at the time the reserve determinationis made. SEC Industry Guide 7 normally does not permit the inclusion of information concerning "measured mineral resources”,"indicated mineral resources” or "inferred mineral resources” or other descriptions of the amount of mineralizationin mineral deposits that do not constitute "reserves” under SEC Industry Guide 7 in documents filed with the SEC. Investorsshould also understand that "inferred mineral resources” have a great amount of uncertainty as to their existence andgreat uncertainty as to their economic and legal feasibility. Under Canadian rules, estimated "inferred mineral resources”may not form the basis of feasibility or pre-feasibility studies except in rare cases. Disclosure of "contained ounces”in a resource is permitted disclosure under Canadian regulations; however, the SEC normally only permits issuers to report mineralizationthat does not constitute "reserves” under SEC Industry Guide 7 as in-place tonnage and grade without reference to unitmeasures. The requirements of NI 43-101 for identification of "reserves” are also not the same as those of SEC IndustryGuide 7, and reserves reported by NOVAGOLD in compliance with NI 43-101 may not qualify as "reserves” under SEC IndustryGuide 7. Donlin Gold does not have known reserves, as defined under SEC Industry Guide 7. Accordingly, information concerningmineral deposits set forth herein may not be comparable with information made public by companies that report in accordance withSEC Industry Guide 7.

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On October 31, 2018, the SEC adopted a final rule (“NewFinal Rule”) that will replace SEC Industry Guide 7 with new disclosure requirements that are more closely aligned with currentindustry and global regulatory practices and standards, including NI 43-101. Companies must comply with the New Final Rule forthe Company’s first fiscal year beginning on or after January 1, 2021, which for NOVAGOLD would be the fiscal year beginningDecember 1, 2021. The New Final Rule provides that SEC Industry Guide 7 will remain effective until all registrants are requiredto comply with the New Final Rule, at which time SEC Industry Guide 7 will be rescinded. While early voluntary compliance withthe New Final Rule is permitted, NOVAGOLD has not elected to comply with the New Final Rule at this time.

Exhibit 99.3

NOVAGOLDChairman Thomas S. Kaplan Addresses Misleading Short-and-Distort Report by Short Seller

June 08, 2020 - Vancouver, British Columbia – NOVAGOLD RESOURCES INC. (“NOVAGOLD” or the “Company”) (NYSE American, TSX: NG) today released a statement issued by Dr. Thomas S. Kaplan, Chairman of NOVAGOLD, who also represents the largest shareholder of the Company. Dr. Kaplan addresses a blatantly misleading report issued on the Company by short seller J Capital Research (JCAP) on May 28, 2020. In that report, the Company believes that JCAP, masquerading as a research firm, is perpetrating, what is known as a short-and-distort scheme designed to nefariously inject the market with misleading and false negative information about the Company to drive the price of its security down in order to allow those with short positions to quickly cover them at an artificially low price and, in doing so, derive a quick profit on the backs of unsuspecting shareholders.

The Company provided a separate detailed response to this attack. This response highlighted, line-by-line, a myriad of JCAP’s falsehoods and outright lies and scrupulously juxtaposed them against corresponding facts in a multipage document, linked to a separate press release which can be viewed here: https://www.novagold.com/investors/news/index.php?content_id=2354.

“With lies you may get ahead in the world – butyou can never go back.”

On Thursday morning 10 days ago, I was enjoying a particularly sweet moment, savoring a fine cup of Nespresso’s (now discontinued) Ethiopian Yirgacheffe-origin coffee – my favorite. For myself, as for many of you, the coffee drinking ritual is an important one, especially these days, when home and office are now more than ever one and the same. It was another day under lockdown in our New York City apartment, yet I felt blessed to have a family and loved ones mostly safe from our common foe, and in as reasonable spirits as one can be when profoundly aware that tragedy and trauma surround us all. The mood was actually upbeat as my older son had narrowly avoided a ruptured appendix a couple of mornings before and, benefitting from the combination of his precocious self-diagnosis of appendicitis, the laser-like focus of our family’s physician, and the surgical staff at New York-Presbyterian/Columbia Hospital, he was operated on and back at home in his own bed the very same day. This constituted the first “outing” either of us had in quite some time and was thus memorable in more ways than one. Witnessing my boy up and about after one day of bed rest only was astonishing, and as gratifying a moment as one could ask for as a parent.

My tranquility was suddenly broken by a flurry of e-mails from friends and colleagues. Had I seen the “hit piece” on NOVAGOLD? I had not. When I read JCAP’s report, my first reaction was to chuckle because the piece was clearly so fallacious that I initially assumed it had been written by a child – cooped up kids have far too much time on their hands these days – or, more likely, a disgruntled short seller. The long winter that had witnessed the cratering of the gold industry over the past decade had in fact decimated many actors in the space. Some had simply gone by the wayside, much like the proverbial hare in Aesop’s fable, the victims of fatal flaws that can best be described in broad strokes as follows: self-inflicted wounds, jurisdictional reckoning, or plain bad luck. Other than a hiccup of collateral damage when our partner Barrick went through one of its periodic praetorian blood lettings back in 2013, NOVAGOLD had suffered from none of these afflictions and, tortoise-like, had marched steadily up the value chain and was now trading at multi-year highs.

It therefore made no sense to me that one would go out of their way to short our stock. And, as Mark Bristow and I shared a laugh with each other last week, who in their right mind would short a great gold story in a growing bull market in gold? Be that as it may, the hunters in this case were cunning in their larceny and caught us unawares, as those who throw a sucker punch (or, as the Aussies call it, a “coward punch”) know in advance that it will. Conspicuously manipulative in their conflation of events and personalities, we could immediately see the obvious intent of the document and assumed everyone else would do too. When our largest shareholders expressed not only solidarity, but also genuine outrage at JCAP’s obvious falsehoods and underhanded ways, we learned that while the experience may well be new to us, it was not to others.

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With little experience in dealing with nefarious actors, we chose the path familiar to us: we would ignore the defamatory aspects of the piece, and tackle the challenge as if it were a traditional shareholder enquiry. After all, we pride ourselves on being unusually transparent in our communications and reporting, as evidenced by a previous exercise in which we invited real analysts to submit any questions they wished to ask of management. True, the two situations were apples and oranges – yet their contrast proves to be rather insightful. The enquiry that followed came from a veteran, industry-leading analyst (John Bridges, who retired last year), who worked at a legitimate firm (J.P. Morgan) and was honest, fair, and well-meaning in all his research coverage – and, I should add, bullish on the NOVAGOLD story. He submitted many questions – we answered them all in writing, and he published them. We translated that success into a regular model of writing in-depth Q&A sections in our Annual Reports that communicate to our shareholders, or prospective shareholders, the most frequently asked questions of us, so they can see for themselves not only the answers to what they want to know, but also answers to questions that others have thought of and that may have escaped them. Believing that an educated consumer is the best and most steadfast customer, we have often been cited – by true experts like John Hathaway and discerning investors like John Paulson and Will Danoff – as being a model of transparency and shareholder alignment in our industry.

I am truly proud of the fact that being held to account is something we welcome – and in fact always will. We just love it. In this instance with JCAP, we knew better than anyone that the contentions at hand did not reflect sincere, constructive examinations or questions. As to their disgraceful endeavor to paint our management team as the same one that had crippled NOVAGOLD – long before we entered the scene and began fixing it in 2009 as a white knight, and turned the Company completely around after taking over management in 2012 – it was downright libelous. In other words, knowing full well that the claims were mendacious, it became clear that this exercise constituted a deliberate, if utterly shameless, attempt to manipulate our share price for financial gain.

To that extent, as I saw the volumes spike and our stock slump, the hatchet job was working. Was this even legal, I wondered? At first, we weren’t sure, but it seemed it shouldn’t be as the misstatements were so blatant as to suggest defamation or worse. I confess that I am not in the business of trading, and certainly not short-selling, so the whole phenomenon was completely alien to me. One can easily imagine the shock to our management team. It was hard for us to even find an analogy. A “sucker punch”? It sure qualified, but these can happen even among friends in a moment of weakness. So that did not seem strong enough. A Clockwork Orange-inspired, financial adaptation of the so-called “knockout game”? Perhaps equal in savagery, but also senseless. A “snatch and grab”? Getting closer. Might it typify a “mugging”? Closer still, as a mugging definitely constitutes a theft, yet can also be both physically and psychologically scarring. In actual fact, as I googled the singular incident I felt we were experiencing, I found the precise definition of what had befallen us: a “short-and-distort” campaign.

We are, unfortunately, not the first to fall victim to such a campaign. Indeed, articles have been written about these schemes, describing some common patterns of how they have been carried out: first, a person or firm purporting to be a financial analyst publishes statements alleging that the company has acted fraudulently or is otherwise in financial trouble; then investors with long positions react to the published statements by selling their long positions; then the company’s share price drops, resulting in a loss of market capitalization, and perhaps worse, a tarnished reputation; finally, those who have taken short positions on the company cash in on this series of events. One such article can be found here:

https://www.dlapiper.com/~/media/files/people/weiner-perrie/weinerweberhsu.pdf

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We will not stand idly by as a “short and distort” campaign is waged against NOVAGOLD. The statements made by JCAP about NOVAGOLD are false, misleading, ultimately defamatory, and illegal in many respects. NOVAGOLD intends to pursue the legal action available to it so that these wrongs can be redressed. Understanding the breadth of these “short-and-distort” schemes also helps explain why it has taken NOVAGOLD’s management some time to assemble a comprehensive rebuttal to a succession of perfidies so voluminous and twisted as to require an army of readers and literally a line-by-line response.

“As the vilest writer hath his readers, so the greatest liar hath his believers:and it often happens, that if a lie be believed only for an hour, it hath done its work.”

Suffice to say, I unequivocally believe that anyone reading our Company’s response to this catalogue of errors – of both commission and omission – will conclude that JCAP’s agenda was to manipulate NOVAGOLD’s stock and profit from an unwarranted and unjustified sneak attack on an organization that has been “doing it right” for at least the past 8 years that Greg Lang and I have been in charge. As reflected in Jonathan Swift’s rather apt observation about the utility of falsehood, highlighted above, it is the nature of the beast that the perpetrators make their ill-gotten gains from unsuspecting shareholders who are duped out of their money after such an assault. For their report is not so much populated by “contentions”, as outright mendacities of different complexions. Even so, our rebuttal will prove devastating to them – an outfit about whose reputation and tactics we have now learned a very great deal indeed. And the good news, as one reading the above-mentioned article will gather, is that they can no longer “go back” – redress now exists against their unjustified acts. Our shareholders should be confident in knowing that we plan to do everything that we are allowed to do within the law to get redress for JCAP’s falsehoods, in whatever jurisdictions apply the rule of law, and that we plan to do so to the fullest extent of that law. To quote Mario Draghi, albeit in different circumstances, “We will do whatever it takes.” More prosaically, to those who aided and abetted this pathetic exercise – we know some of who you are, and the rest we will learn who you are.

Pathetic Doesn’t Begin to Describe It

As one can observe from the Company’s formal response, which itemizes literally hundreds of falsehoods, lies, errors of fact, and other objects of distortion, JCAP has a lot to answer for.

Tops of the Waves

Let me touch on a few subjects briefly, so as to put them to bed right away. First is the laughable positioning of the author and his anonymous “experts” as duly qualified to opine on building pipelines in Alaska. On the one side is Tim Murray, who has no known experience in the space and cites unnamed experts. On the other is CH2M HILL (CH2M) – real experts that have been serving oil and gas clients in some of the Arctic’s harshest conditions, including the North Slope, for over 40 years, and a firm that in 2013 represented the 6th largest employer in Alaska and the second-largest employer in the State’s oil and gas industry. In 2017, CH2M was ranked #22 on Fortune’s 2017 list of “Top 50 Companies that Change the World” for making a positive impact on society. That same year, CH2M was acquired by Jacobs Engineering Group. One of the deal drivers, as cited in the media, was CH2M’s infrastructure business. Management definitely stands by the work completed by the CH2M-led group for Barrick and NOVAGOLD, and the work performed to price the pipeline out inch-by-inch, mile-by-mile.

The Donlin Gold project (the “project”) that was evaluated in the 2011 Second Updated Feasibility Study (FSU2), as defined below, and Federal and State permitting includes the gas pipeline that is obviously based on a sound design, completed by highly experienced pipeline engineers. Throughout NOVAGOLD’s detailed response, the Company refutes every one of JCAP’s comments about the feasibility of the pipeline’s plan. And management continues to look at ways to optimize development of the pipeline, including a range of partnership and financing options. NOVAGOLD, along with our Native Corporation partners, also recognize the great benefits of bringing gas to the region. However, the reality is that a pipeline is not the only option available to the project. The original feasibility study was also predicated on a barging alternative that remains viable if it is best for all those concerned.

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Perhaps it is the libel of the so-called insider selling. The bottom line here is that none of the Company’s insiders have sold stock other than to exercise options – and in fact have been increasing their shareholdings. It should be apparent to anyone that stock options do not have any value unless the share price appreciates from the date of grant, which means that, by definition, non-insiders must also be benefitting from similar conditions. Take it from me. I have heard from plenty of institutional investors who acknowledge their gratitude to NOVAGOLD’s management for work well done.

Perhaps it would be JCAP’s utter ignorance about the difference between initial and sustaining capital. Or their failure to understand that it is not advisable to conduct exploration drilling outside the footprint of the mine being permitted during the permitting process…hence the gap in drilling between 2011 and now. It is worth noting that this explicit hiatus ended after receipt of the Federal permits, which is why, in light of the excellent high-grade results of 2017, the partners renewed drilling with an increasingly robust program in 2020. Why not? The 2017 results were great, and formally presented in the press release, “NOVAGOLD’s Donlin Gold Project Reports Excellent Results from the 2017 Drill Program,” dated February 20, 2018. Kelvin Dushnisky, then President of Barrick, declared on that occasion:

“We are very encouraged by the latest drill results at Donlin Gold,some of which encompassed areas where relatively little drilling had been previously done. The results are further evidence ofthe significant potential of this deposit. We look forward to continuing to collaborate closely with our partner, NOVAGOLD, toadvance optimization work and permitting at this unique project.”

We actually love to drill, and see huge opportunity to expand the resource – most immediately along strike of the existing deposit, which comprises only 3 km of an 8 km mineralized belt and which, in its entirety, represents less than 5% of the total land package. Now under the watch of Mark Bristow, a brilliant geologist, the drill rigs are active as I write this. Few people know better than Mark what drilling can do to unlock and enhance value, as evidenced by his signal successes in doing so at Randgold. Considering that my own personal wealth was primarily created through the drill bit, being able to drill at Donlin Gold is for me a dream come true – and we could not be more thrilled to have a partner that shares our enthusiasm.

Were I to continue and enumerate all of the falsehoods contained in the JCAP report here, I would merely duplicate the hundreds of comments provided in the Company’s excellent matrix. And to what end, anyway? The JCAP assault was never meant to be an “analysis”, but a profit-motivated scare tactic. Still, I feel compelled to focus on a few things to help those who are witnesses to the event fully understand what they saw happen…and will see unfold in short order.

The Art of the Steal

The “Original Sin” of the libel can be found in the first incendiary sentences:

“The deposit that will never be mined… For the last 15 years,NovaGold’s management team has systematically misled investors…”

Let us pause right here. The report essentially opens with a conscious attempt to mislead unsuspecting investors by inferring that the present “management team” has been leading the Company for 15 years – a deliberate conflation of two distinct eras of completely different management teams into one. This sentence is written, knowingly and with malice, to make that investor stop what they are doing, reach for their stockbroker’s telephone number, or perhaps their trading room if the investor is institutional, and order that person to sell immediately. It is the equivalent of yelling fire in a crowded theatre, hoping that people will trample over one another for the exits without even taking a moment to assess the situation. For some investors, they might feel “why even wait: there’s a problem, get me out!” Those who create the “crisis” know that the sentences are fraudulent. Thus in the inaugural sentence of the JCAP report lies the first fruit of the poisonous tree of willful “distortion”, defined herein as “to give a misleading or false account or impression of”.

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From this moment forward, as has been conveyed to us by major shareholders, they understood that they were witnessing a willful and calculated manipulation. Due to our well-known reputation for extraordinary transparency in our communications and reporting, these knowledgeable investors are unusually well-educated in Donlin Gold. Hence the outrage that has characterized the response from our institutional shareholder base to this report. But perhaps it was not the intention of JCAP to address their shameful maneuver to educated investors in the first instance. It was solely meant to dupe less informed participants to sell shares without a legitimate basis for doing so. One of the easiest ways to frighten existing shareholders, or encourage others previously uninvolved in the company to sell shares short, is to imply that the company has been engaged in wrongdoing. As such, the lowest hanging fruit is to attack “bad” management.

The inference to the uninitiated audience that the management team that ran the Company 15 years ago is the same management team running the Company now is clearly false. Moreover, the caliber of the managements during those two eras is, in effect, apples and oranges. To put it in another way, and most vividly: when speaking of the Chicago Bulls pre and post the entry of Michael Jordan into the mix, MJ is not held accountable for the state of the Bulls franchise before he arrived and turned their fortunes. To me, as one of the owners of our team, Greg Lang might as well be Michael Jordan.

Just look at the language. It is not only logical but standard practice in discussing “management teams” to draw clear distinctions between the eras or tenures of the different teams. This is particularly true – and important – when the core of the discussion centers around the dichotomy between the respective performances of those teams. In simple terms, the team that is recruited to turnaround a business that was crippled under the leadership of its predecessors is never conflated by objective, well-intentioned and professional analysts, with the team that was removed after the business had been sunk under their watch in the first place. That seems obvious. Particularly as doing so to impugn the incumbent management constitutes a deliberate distortion.

Yet throughout the JCAP report, there is a deliberate use of the word “Management” to attack the incumbent management that has run the Company most successfully, and to the great benefit of NOVAGOLD’s shareholders. The smear inherent in this distortive conflation of “Management” appears no fewer than 13 times in the report, while “CEO” appears with a similarly abusive 8 times. The adjective “disingenuous” does not begin to reflect the severity of this deception. It is in fact a willful disregard for the objectivity that should allow the reader any confidence in the agenda of the analyst who publishes such obfuscations. It is, however, perfectly understandable that a firm engaged in nothing more than a cynical and illegal exercise in market manipulation would employ such a subterfuge.

It is axiomatic that the present management cannot be held responsible, directly or tangentially, for actions that took place prior to their assuming leadership of the Company and which they then effectively fixed. The present management team has been leading NOVAGOLD for eight years – not 15 – during which time it has not misled investors in any fashion. To the contrary, their tenure coincides with an era of complete transparency in their corporate communications, as well as uninterrupted management successes in working with their partner Barrick Gold to take the Donlin Gold project up the value chain and in addition to unlocking for shareholders the considerable value of the copper assets they inherited.

This issue bears some elaboration, for within NOVAGOLD’s Annual Reports one can find a clear and open discussion of the “before and after” events that led to the transition from one management team to another. Indeed, in light of the opaque and dissembling nature of JCAP’s attempt to obfuscate key facts, let us challenge their assertions with statements of facts drawn from a publicly filed document – namely, the Company’s 2018 Annual Report. Here was my direct answer to a question from a shareholder:

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“How did you acquire your interest in NOVAGOLD and has your investmentthesis changed?

One of the best examples of the buona fortuna that I believe emanates fromthis precept was the fruit that fell into my lap in December 2008 when, with the wise counsel of The Electrum Group’s President(and fellow NOVAGOLD Director) Igor Levental, we entered the NOVAGOLD saga as something of a white knight, purchasing the Company’sshares for the very first time in order to save it from existential challenges across an extraordinarily broad front. Putting asidethe fact that the economic environment at that time was not particularly permissive of any investment at all, our interventionappeared – even to our closest friends – as akin to catching a falling knife. The news on NOVAGOLD was littered withfires that desperately needed to be put out: debt coming due; class-action lawsuits; environmental disputes with the EPA (regardinga modest gold property that was remediated and divested many years ago); loss of credibility with investors and analysts; and hostilityfrom at least one of its key partners. I could go on. But being that we were not irrational by nature – and that it’smuch more fun to speak to what transpired afterward – we reached the conclusion that taking control of the Company wouldprove to be worth it.

As a bit of background, I had long coveted exposure to the Donlin story. Watchingfrom a distance from the early 2000s, I felt that I had missed the chance as NOVAGOLD’s shares rose from pennies to severaldollars on the back of drilling that produced what were clearly among the best exploration results in the gold industry. I wasn’tthe only one who saw this potential; Barrick not only shared my view, but also tried to buy the Company in 2006. The failure oftheir takeover attempt was to have enormous implications for both companies. While it was separate Company-specific and financialcrisis-related factors that crippled NOVAGOLD and led to our intervention, what was never in dispute was that Donlin Gold constituteda rare combination of both jewel and elephant.

I often tell the story about how I gave my team 48 hours to perform the duediligence on NOVAGOLD before pulling the trigger on the deal – a time frame that should appear to be reckless any time geologyis involved. My reasoning was redolent of the joke about the two hikers who run into a bear in the woods: One hiker starts to run,while the other calmly kneels and starts to put on his running shoes. The man already running shouts to his companion and askswhat he’s doing. The one tying his laces answers, “Sorry, but I reckon I don’t have to outrun the bear, I justhave to outrun you.” Similarly, I said to my team, “We don’t have to believe NOVAGOLD about Donlin; we just haveto believe Barrick.” Barrick being a first-rate company, the due diligence from public sources was remarkably straightforward.Only after we had made our investment in NOVAGOLD did we send our chief geologist, Dr. Larry Buchanan, to walk the property andshare his impressions. “Is the deposit what we thought at Donlin?” I asked upon his return. “Oh no,” saidLarry. Mercifully, he quickly added, “With an 8km strike being 5 or so percent of the property package, the next Donlin couldbe at Donlin. Congratulations.”

The problems the Company faced nonetheless were real and rather daunting.It took some doing to clean up those burdens that made our exercise appear death-defying. But the Company was turned around, weraised capital with allies – especially the Paulson and Soros funds – and NOVAGOLD’s shares, having been pricedfor bankruptcy, returned by 2010 to the level at which Barrick had made its 2006 bid.

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In 2011, not long after Barrick and NOVAGOLD announced the results of thefeasibility study on Donlin, I was introduced to Greg Lang, a 25-year veteran of Barrick and its predecessor companies. Greg’scareer had been marked by both escalating promotions and successive wins. After running Barrick’s Australian operations,he had been given responsibility for much of the Western Hemisphere where, by the time we had met, he had served 8 years as presidentof Barrick Gold North America. His experience in overseeing the permitting and building of large mines – including the CortezHills Mine in Nevada, which impressively came in within budget and on time – epitomized what I was looking for. Having concludedthat the Donlin deposit displayed all the makings of the Holy Grail for a gold investor, I sought a CEO who could take Donlin throughpermitting. When Igor Levental and Gil Leathley spoke about Greg, it seemed fated. His Homestake pedigree, one he shared with Igorand Gil, was an added plus. Indeed, I have always found that most everyone who worked well with the legendary Harry Conger possessedthat subtle combination of intelligence and character that I seek in my colleagues.

As it happened, my appetite coincided with GregLang’s desire to be engaged with a pure play on the asset he thought could be the greatest gold mine in the world. He wasan educated consumer, having sat on the Barrick side of the table during the hostile takeover attempt, and then as a Barrick representativeon the Donlin Gold LLC board. We had an immediate meeting of the minds, nodding to each other as we ticked off the attributesthat rendered Donlin not just a great development-stage asset, but also possibly the best. Never before, said Greg, had a goldmine started with nearly 40 million ounces in measured and indicated resources^1^.

Some, including Goldstrike, would eventually reach that. But started there?And there was probably more gold, we agreed. For an engineer, of course, for whom grade is king, the high grades and consistencyof the orebody, as well as the site’s gentle topography, moderate climate, and the excellent community relations that RickVan Nieuwenhuyse had nurtured, all made Greg feel that this would be not just a mine, but possibly one of the finest of the dozenshe had visited around the world throughout his career. Once in production, we calculated, it could potentially represent the largestpure gold producer in the world.”

Reading this anew, and remembering fondly what has followed, I must admit that Aristotle was right: a friendship is a partnership. I am proud to call Greg my friend and, like all NOVAGOLD shareholders, sincerely appreciate what his leadership and team have done for us.

The NOVAGOLD Advantage

One of the more glaringly positive differentiators of our Company is that management has done nothing about which it isn’t quite proud since Greg Lang and I took the helm in late 2011. Simple virtues, like not cutting corners and “doing it right” – our shared mantras from technical work to the environmental and social license we value so highly – have served our shareholders well and given us considerable credibility. Part of that ethos is that we both feel deeply that honor – yes, honor – matters. Thus, the vows that we have made to our shareholders, stakeholders, and partners have been kept and, as a result, our Company has since enjoyed a coterie of exceptionally well-informed, savvy, and satisfied shareholders. There are clearly attributes that John Paulson, who added 3 million more shares in the last quarter after 10 years as a shareholder, sees in our story. And Fidelity. And First Eagle. And John Hathaway. And Jacob Rothschild and the Agnellis. You get the point. I could go on, but a key reason is, basically, because NOVAGOLD is a pure play on an asset that we regard as “The Next Nevada”. There is no pure play on the Barrick-Newmont joint venture in Nevada. I wish there were. There is, however, a pure play on the Barrick-NOVAGOLD joint venture in Alaska – which already ranks, incidentally, as the second-largest gold producing State in the Union, after Nevada.

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^1^ Donlin Gold data as per the Second Updated Feasibility Study (as defined herein). Donlin Gold measured resources of approximately 8 Mt grading 2.52 g/t and indicated resources of approximately 534 Mt grading 2.24 g/t, each on a 100% basis. Mineral resources have been estimated in accordance with NI 43-101. See “Cautionary Note Concerning Reserve & Resource Estimates” and “Mineral Reserve and Mineral Resource” table on the Company’s website.

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By “doing it right”, let us start with what we have not done…what I would call successes of omission. First and foremost, we have never been tempted to use our cash or equity to do something foolish. Sadly for the fortunes of our industry, using common sense has proven to be a differentiator in and of itself. As Voltaire professed, “Common sense is not so common.” If, by every metric, one believes one owns one of the best assets on the planet, one simply does not “deworsify,” as the famed Peter Lynch put it so well. Deal junkies we are not. My family has achieved a spectacular rate of return in the natural resources space over the past 27 years because of a few, strict principles. One of them, of course, is trying hard to focus on only large, extraordinary assets. Having achieved 100x multiples in each of silver, platinum, and natural gas – without the use of leverage and just being long “category killer” assets – I adore NOVAGOLD’s business model as a pure play on the supreme category-killer, Donlin Gold. While focusing on great assets, even in an era of asset scarcity, can be like watching paint dry – as evidenced by the last soporific decade in the gold mining space – that era is likely over for good. We are more confident than ever that it is NOVAGOLD’s time to shine anew, and we feel privileged to have it as our flagship in the gold space.

Then, there are the successes of commission – those things we promised to do, and meticulously did. Accordingly, before we were approached with the offer to do a capital raising the last time around, in January 2012, the newly minted CEO and Chairman of NOVAGOLD laid out a clear roadmap for our investors:

●	We promised to spin-off our Alaskan copper assets. That company, spun-off as NovaCopper and now trading under the name Trilogy Metals to reflect its polymetallic attributes, has performed very well – sporting a market capitalization of hundreds of millions of dollars;
●	In order to make NOVAGOLD the only “pure play” on Donlin Gold in the marketplace, we promised to sell Galore Creek<br>– a beautiful asset, but “a project too far” for a development-stage Company with a flagship as ambitious as<br>Donlin Gold. We could have let Galore go in a fire sale. We didn’t. We sold it for real money in a market where win-win monetization<br>has been the exception, not the rule. The cash position we find ourselves in, with more guaranteed and potential payments to come,<br>is the envy of our space;
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●	We declared that, if given an opportunity to show the flexibility of the deposit, we would take it. The drill results Donlin<br>Gold delivered earlier in 2017 blew through even our own expectations. Who gets 130 meters of 6 grams, and 64 meters of 5 grams^2^?<br>We reckon that these constituted some of the best drill results reported by any project for quite a while;
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●	Lastly, we stated that this project would be permitted. When anyone pushed back, assuming permitting in Alaska would be a struggle,<br>we just shrugged our shoulders. The facts pointed to the opposite. All we had ever heard from our local stakeholders and partners,<br>the Calista Corporation and The Kuskokwim Corporation (TKC), were strong indications of support. And, after a thorough search online<br>and in the public records, we could not find any signs of opposition. In fact, the only references to the project in 2012, from<br>a media standpoint, were positive. Six years later, we received the first-ever joint Federal record of decision – delivered<br>in a formal ceremony in the presence of the lead agencies, the U.S. Army Corps of Engineers and the Bureau of Land Management (BLM)<br>– that included extensive input from those who held the reasonable concerns that any big project would bring. For those who<br>know the industry, this represents an amazing occurrence practically anywhere in the world.
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^2^ These represent the two of the top five significant intervals from the 2017 Donlin Gold drill program. Refer to the press release dated February 20, 2018 titled “NOVAGOLD’s Donlin Gold Project Reports Excellent Results from 2017 Drill Program,” for remaining significant intervals and additional information.

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We also promised to build a first-rate management team to take the Company to the next level. Let’s dispense with the petty lies. JCAP makes a puerile assertion that management has been “awarding themselves base salaries that rival those of the CEOs at Newmont and Barrick”. This is not true. Greg’s compensation is roughly half of theirs. And it is obviously not management but rather NOVAGOLD’s highly qualified Board of Directors that awards compensation, following a comprehensive review of the facts. But this kind of nonsense is par for the course in JCAP’s “analysis”.

As to the quality of the team, we really lucked out. For in truth they could run a Major mining company. Again, think pre and post Michael Jordan, for that analogy regarding Greg and his team has real merit for stockholders. Since the Board of Directors reorganized the Company in early 2012 to focus on Donlin Gold, NOVAGOLD was determined to recruit top talent with demonstrated track records in large-scale mine permitting, development and operation, with a particular focus on North America experience. Knowing that a world-class asset warrants world-class professionals, the Company set out to attract the very best people in their respective specialties. And it did. NOVAGOLD’s current management, which has been in place for the past eight years, is, as one shareholder put it, ‘straight out of central casting’. Starting with Greg Lang, NOVAGOLD’s President and CEO, who has over 40 years of diverse experience in mine operations, project development and evaluations, including eight years as President of Barrick Gold North America, a wholly owned subsidiary of Barrick Gold Corporation. Greg held progressively increasing operating and project development responsibilities over his 10-year tenure with Barrick and, prior to that, with Homestake Mining Company and International Corona Corporation – both of which are now part of Barrick. Major mines that now represent the foundation of Barrick, such as Cortez Hills, were built under Mr. Lang’s leadership.

Richard Williams, NOVAGOLD’s Vice President Engineering and Development – responsible for all aspects related to the engineering and technical advancement of Donlin Gold – is yet another star. Richard spent over 30 years with Barrick Gold developing and operating major mines. He is one of the most highly regarded and experienced leaders in the autoclave technology that is planned to be used to process ores at Donlin Gold. Importantly, he served as Project Director of the Pueblo Viejo project in the Dominican Republic, now one of the most successful mines in Barrick’s portfolio of assets. Richard’s seven-year tenure at Pueblo Viejo capped a career where he progressively held top operating roles that included the design, construction, and operation of mineral processing facilities of major mines, such as Goldstrike in Nevada and Mercur in Utah.

David Ottewell is Vice President and Chief Financial Officer of NOVAGOLD, responsible for all aspects of the Company’s financial management. Dave is a highly accomplished financial executive, with over 25 years of mining industry experience. Prior to joining NOVAGOLD, he served as Vice President and Controller for Newmont, the largest gold mining company in the world. Other members of the NOVAGOLD team are equally accomplished in their respective areas of expertise. In order to attract this caliber of professionals, the Company has to compete to recruit and retain top talent in the industry. And we did so beautifully.

This remarkable series of kept promises certainly goes a long way in explaining why NOVAGOLD was so successful in executing on its value-building strategy, with achievements shown in the figure below from our presentation at our Annual Meeting of Shareholders dated May 14, 2020:

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Moreover, we kept to a brilliantly simple script. For those who remember back to 2012, after we raised $330 million though Royal Bank of Canada and J.P. Morgan, we laid out a very precise strategy. It would appear that management more than kept its promises…

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Yet one would not see anything of the sort acknowledged in JCAP’s hit piece. To the contrary, the report engages, almost sentence by sentence, in a devious smear of our present management by indicating that it was they who made the unfulfilled promises and committed the several blunders that caused NOVAGOLD’s stock to drop over 90% in 2007/2008 – and incidentally gave The Electrum Group our first entry point into the Company, as a white knight on New Year’s Eve of 2009. I say first entry point, for not only did none of NOVAGOLD’s present senior management team have any engagement with the Company prior to 2012, but The Electrum Group had never owned – let alone shorted – a single share of the Company before we effectively rescued it. Simply put, JCAP’s attempt to conflate our team with the previous management is deliberately and hugely misleading. Altogether, it is meant to confuse those uninitiated in the story by lumping two completely different management groups with distinctly different track records of performance into one indistinguishable category of “management”. Nor does JCAP mention that it was our team that devised and executed the successful series of bold strokes that transpired afterwards, resulting in one of the most celebrated turnaround campaigns in the space. Who does that, other than those engaged in premeditated deception?

The results are there for all to see. Simply take a look at how NOVAGOLD has performed relative to the GDXJ and GDX indexes since Greg and I took the helm in late 2011. This isn’t cherry picking.

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Let us also assess how we performed versus Barrick and Newmont, the fine companies against whom JCAP compared – completely falsely, I might add – Greg Lang’s compensation:

Doing Well by Doing Good

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For the multiple reasons cited in NOVAGOLD’s rebuttal, and dozens of other triggers actually, JCAP has pulled on the wrong tiger’s tail – forcing me to lead the Company into a fight. One of the reasons I shall do so is that, quite frankly, I and we should do so. If good companies and honest managements can be impugned in such ways as we are experiencing, not by legitimate activists but by stock manipulators, then we have something of a moral, or at least civic, responsibility to do unto them as they would do unto us (and others) – a dictum more commonly known, perhaps ironically in this case, as the Golden Rule. The other reason is that we can. And we will. I don’t bluff. Those who read our Annual Report from 2018 may recall the title of my Chairman’s Letter: “Papa Doesn't Play Poker”.

I have always felt that the NOVAGOLD story is so special that my only regret has been that more people didn’t know of it. It has been my firm belief from the start that we are the single best vehicle in the gold development space and, as I have said many times, if I found something better I’d sell NOVAGOLD and pivot to that other thing. The point is this: when I speak about Donlin Gold, I often ask this question of my audience: what other gold development-stage asset in the industry compares in its combination of enormous size, high-grade for an open pit (and hence low all-in cash costs), truly superb exploration upside, a production profile of potentially the biggest pure-gold mine in the world, a mine life measured in decades, excellent local and industry partnerships, and the safety of being located in the world’s premier jurisdiction? I’ve never heard pushback with that one. If one cannot challenge the assertion, then Donlin Gold must be unique.

For more on the Case for NOVAGOLD, I urge you to go to our website, and to review the latest presentation from our AGM, one of the rare gold mining AGMs that actually gets quoted in generalist media:

https://www.novagold.com/investors/presentations/

Donlin Gold is also fortunate, admittedly, to be advancing at a time when, by reasonable objective analysis from, inter alia, Ray Dalio, Jeff Gundlach, Paul Tudor Jones, Paul Singer, Mark Mobius, John Hathaway, and other seasoned professionals, gold’s attractiveness as a financial asset is being broadly reaffirmed. In plotting our long-term vision for value maximization, we have long argued that gold will be resuming its secular bull market and has the potential to reach a price level that is a multiple of the current levels. I laid out such a case for gold on television to David Rubenstein, a year or so ago, for his “Peer-to-Peer Conversations” series on Bloomberg:

https://www.bloomberg.com/news/videos/2019-05-29/david-rubenstein-show-tom-kaplan-the-electrum-group-chairman-video

All the factors that I cite in my conversation with David, and many more factors for that matter, point to the reality that we and our shareholders intend to build Donlin Gold. The question is when. In light of the renewal of the bull market in gold, combined with Donlin Gold’s success in securing necessary permits for the project, NOVAGOLD and Barrick are fully aligned in carefully monitoring developments to advance Donlin Gold towards construction, at a time when both partners conclude that they can achieve maximum benefits for all stakeholders, including our shareholders. Given the industry’s suffering from both asset scarcity and the ravages of rising jurisdictional risk, we believe that having equal ownership in a Tier 1 asset located in a Tier 1 jurisdiction suggests that time is clearly on our side. This, in turn, will give our shareholders “maximum leverage in the perfect jurisdiction to keep the fruits of that leverage.” For more on that angle, one can watch my interview with Dan Tapiero, in which we talk gold and, yes, Donlin Gold.

https://www.realvision.com/the-kaplan-doctrine-conservation-preservation-and-value

Without doubt, NOVAGOLD is becoming a “go-to” stock in the space, especially as the sentiment in this sector improves and interest is steadily but surely finding a channel into scarce “category killer” North American assets. There are myriad good reasons for this. For while I hate to say it, there won’t be very many players left in the gold space. Collapsing grades, the paucity of new discoveries, the churning through of reserves at existing mines by the Majors, all but confirm that we have already reached Peak Gold. Let me remind the reader that gold is not like hydrocarbons, with vast reservoirs or resources ready to be switched on quickly if prices rise, or unlocked simply by new technologies like horizontal drilling for fracking. The mining industry doesn’t have 3-D Seismic, and deposits can take decades to go from prospect to mine. Peak Gold really is Peak Gold. Barrick recently estimated that gold production will decline by 5% a year for years. I believe that’s about right. If anything, it will likely prove to be a conservative forecast as jurisdictions once thought investible no longer are so, and declining grades mean higher costs with less output.

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As such, assets like Donlin Gold, with metrics that are accretive on practically every dimension, are essentially unicorns. When I survey the landscape, I am reminded of the carnage that was visited on the tech space after the late 1990s bubble burst. If one had the presence of mind to sift through the wreckage and have the wits to pick a winner or two – an Amazon or Apple, for example – one made a generational trade. Similarly, I believe that those few gold companies that have great assets in great places will constitute generational opportunities. That NOVAGOLD will stand among those precious few is, for me, indisputable. Am I comparing NOVAGOLD to Amazon or Apple? Yes. Not in that it will achieve a trillion-dollar market cap, of course. But at least in that I believe it will be one of the biggest winners in what is likely to become a very hot space now that it has risen from the ashes.

Candidly, helping this particular scenario come along is our objective. As the great wit Talleyrand put it, “the art of statesmanship is to foresee the inevitable and to expedite its occurrence.” We’re open about it. I’m open about it. We at Electrum consider Donlin Gold to be the Holy Grail and want it to be valued for the “category killer” we and our shareholders see it to be. Electrum will only make money to the extent that our co-investors will. That the owners “live above the store” is viewed favorably, and our co-investors are exceptionally well-educated about our narrative. For those new to the story, I am encouraging the reader to go through NOVAGOLD’s most recent annual reports. The 2018 and 2019 editions can be found here:

https://www.novagold.com/_resources/NG_2018-AR.pdf

https://www.novagold.com/_resources/NG_2019-AR.pdf

I do urge you to read them precisely because they are considered, by our investors, to be The Gold Standard of transparency and intellectual coherence in the gold development space.

The White Swan

A few words about the relationship with Barrick, and Barrick’s engagement with Donlin – so distorted by JCAP. As I wrote the following in the Chairman’s Letter of NOVAGOLD’s 2019 Annual Report:

“There’s no doubt in my mind that the posture of Barrick towardDonlin has been growing warmer and warmer as the Randgold team has come up to speed on the asset and become more intimately acquaintedwith what they own. The optimization process is going well, and the geological model is shaping up nicely. As the Barrick/NOVAGOLDteams work on testing the geometry of the deposit to establish a future mine’s optimal throughput, the camaraderie has onlybeen accentuated. In truth, we are thrilled with the engagement from the “new Barrick.” It is very much worth notingthat, despite Barrick’s always maintaining its commitment to the permitting process, in fact we hit a delightful milestoneof sorts last summer when Mark Bristow became the first Barrick CEO in a decade to actually visit the property! Mark is a professional’sprofessional, and anyone who is familiar with his management style will know that he is hands-on – and that such an approachshould be no surprise.

But still, seeing the white swan – or the peregrine, as I have takento calling Mark more recently – on site at Donlin was a truly welcome occasion for all concerned. Mark met our Native corporationpartners and senior state officials. Being a geologist, he experienced the deposit firsthand in a way that one really has to inorder to fully appreciate what an ideal place it is to build a first-class mine. Suffice to say that he clearly gets what makesDonlin, in his words, “one of the best options on the gold price in the world.”

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More than that, he now speaks of Donlinto analysts and investors pretty much as I do, and often goes out of his way to remark on how our teams – and he and I personally– are working so well together.”

Mark and I see perfectly eye to eye on Donlin…perfectly, and happily so. He and I tend to enjoy a bit of Saint Julien when we’re together, and we both know that “no wine before its time” is always the right approach. And that “do it right” is indeed the “right approach”. We also know that Donlin Gold is maturing nicely, and represents a unique investment proposition for both our companies when the time is also right. As he has said publicly: Donlin Gold “offers a huge optionality to the gold price across multiple gold price cycles in an excellent jurisdiction.” Meanwhile, as he puts it, “Donlin is becoming a global brand”. As this is what I have been trying to accomplish from the outset – Mark will attest from his various experiences with me that, when I enunciate a strategy, I keep the faith with the project and the people all the way through – this is really quite splendid for our shareholders. To me, all roads lead to Donlin Gold as the perfect asset for the times and, as I titled my Chairman’s Letter in this year’s Annual Report, “The Winds of Change” are upon us.

I have always believed in giving back, and not so much in “getting even”. While I am not a pacifist and always fight back when my friends and allies are attacked, getting even as a way to spend one’s time is usually a waste of valuable emotional energy. Given how lucky I am, it would also be counter-productive. There are too many great things in my life to strive for in the non-profit world (not to mention the for-profit world) that, on balance, seeking retribution for life’s inevitable disappointments is simply pointless. Doing so would not give me more time with my wife and children, or any of the myriad other pursuits that give my life both purpose and joy. And, in any event, the world needs more kindness, not less.

Some may feel that my response to this present matter must surely indicate some frustration. Disabuse yourselves of that notion. While I strongly believe in such quaint things as honor, reason for me trumps all. And yet…I will confess that this time feels a bit different.

“With lies you may get ahead in the world – but you can never go back.”

While it is true that we have tried not to take JCAP’s defamatory statements to heart because they form such a sad tapestry of lies, as highlighted by the Russian proverb cited above, one particular comment in the JCAP piece needs to be underscored. It was but one of the many gross distortions, but a rather special one. As page 14 reads, in reference to Galore Creek:

“The $275 mln consideration included $75 mln contingent on production,which is so unlikely that NG is not accounting for it” and “Newmont quietly shut the project down on April 28, 2020.”

It’s not the first part of the sentence that stunned me, for it was clear that finding anything that was actually true in the JCAP piece was the real challenge. For accounting purposes, contingent assets require a higher level of certainty to be recognized than for contingent liabilities to be recognized. The contingent note hereby mentioned will be recognized when, in management’s judgment, it is probable that the payment will occur, and that the amount recorded will not reverse in future periods. We provide the information and let investors assess the recoverability for themselves. That’s called conservative accounting and any real analyst would acknowledge that it is best practice.

It was in fact the last 10 words that stunned me. The implication being that the project will not be built and had been killed. In reality, Galore, which is equally owned by Teck Corporation and Newmont Corp., delayed fieldwork and PFS-related activities in 2020 due to COVID-19, much like many other operations around the world during this pandemic. JCAP actually refers to a press release which, when read fully and with integrity, states:

“(…) due to the COVID-19 pandemic and the resulting economicuncertainties faced by the mining industry, expenditures on the Galore Creek project have been reduced in 2020, deferring the startof the planned Prefeasibility Study. A core team and funding are in place to meet current permit, environment and community obligations.”

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Choosing to portray a COVID-related slowdown as an indication of Newmont “quietly shutting the project down” epitomizes JCAP’s indecency and intentionally warped interpretation of facts. That, in this instance, the jab would be designed to injure not only shareholders of NOVAGOLD, but also investors in Newmont and Teck, is especially damning. Candidly, there must be a special place in hell for people so depraved that they would so casually utilize one of the most devastating public health crises in modern times to smear a target – for financial gain. Anyone who even consorts with such people should be ashamed of themselves for the sordid way in which they make money.

For me, business is clearly personal. And, particularly in this moment, decency truly matters. This, however, would not be a new sentiment that I am expressing to our shareholders for the first time. Let me thus conclude with an excerpt from our 2018 Annual Report:

“We know that reputation is hard won and easily lost. My children knowthat I feel this way, as do my colleagues and partners. If I say that I’m going to do something, I’ll do it. It makeslife simpler and allows me to feel, and perhaps actually be, virtuous. It’s also good business. Quaint as that may soundin our increasingly transactional world, this code stems from a deep philosophical attachment to a values-based and purpose-drivenlife. It also comes from being, as the French would say, bien élevé (“well brought up”) in business bypartners who taught me in my youth that your word should be your bond – because it’s the right thing to do. It alsogives you the reputation that is, after all, the coin of the realm in life. Through leading by example, these mentors gave me thegreatest gift of all: namely, understanding the art of practicing integrity. I use the word “practicing” here becausewe all know that, being human, we make mistakes for which we should blush. Moreover, it is well-nigh impossible to avoid trade-offsand negotiations. And what is negotiating, other than socially acceptable – indeed institutionalized – dissembling?With that being said, within the realm of common sense, we can attest to the notion that, by and large, codes of conduct reallydo work.

There are nonetheless multiple perils embedded in this philosophy. First andforemost, it lends itself to being taken advantage of – and occasionally mugged – by those who don’t share similarethical precepts. It also makes being competitive harder at times. For reasons that I perceive better now than in my youth, however,a more philosophical posture – especially when stress-tested in reality – has proven to be a key determinant of success.This approach certainly has not prevented me from being extraordinarily lucky in exploration – the riskiest part of a riskybusiness – or in the fortuitous timing of our more intrepid acquisitions. Such susceptibility for lucky breaks has givenmy team at Electrum a comparative advantage that we’ve pressed on numerous occasions over the past 25 years. Our track recordcan attest to the fact that the fruits have much, much more outweighed any limitations presumably imposed by my personal ethos,summed up by Electrum’s corporate motto: Intelligence is a commodity; Character is a currency.”

While I deeply regret this inconvenience to our shareholders, we will endeavor to seek redress for the damages done by people who exhibit neither intelligence nor character. Meanwhile, I am wishing you all safety, good health, and great peace of mind.

ABOUT NOVAGOLD

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NOVAGOLD is a well-financed precious metals company focused on the development of its 50%-owned Donlin Gold project in Alaska, one of the safest mining jurisdictions in the world. With approximately 39 million ounces of gold in the measured and indicated mineral resource categories, inclusive of proven and probable mineral reserves (541 million tonnes at an average grade of approximately 2.24 grams per tonne in the measured and indicated resource categories on a 100% basis),^3^ Donlin Gold is regarded to be one of the largest, highest-grade, and most prospective known open pit gold deposits in the world. According to the Second Updated Feasibility Study (as defined below), once in production, Donlin Gold is expected to produce an average of more than one million ounces per year over a 27-year mine life on a 100% basis. The Donlin Gold project has substantial exploration potential beyond the designed footprint which currently covers 1.9 miles (3 km) of an approximately five-mile (8 km) long gold-bearing trend. Current activities at Donlin Gold are focused on State permitting, optimization work, community outreach and workforce development in preparation for the construction and operation of this project. With a strong balance sheet, NOVAGOLD is well-positioned to fund its share of permitting and optimization advancement efforts at the Donlin Gold project.

Scientific and Technical Information

NOVAGOLD Contacts:

Mélanie Hennessey

Vice President, Corporate Communications

Jason Mercier

Manager, Investor Relations

604-669-6227 or 1-866-669-6227

CautionaryNote Regarding Forward-Looking Statements

_____________________________

^3^ Donlin Gold data as per the Second Updated Feasibility Study (as defined herein). Donlin Gold measured resources of approximately 8 Mt grading 2.52 g/t and indicated resources of approximately 534 Mt grading 2.24 g/t, each on a 100% basis. Mineral resources have been estimated in accordance with NI 43-101. See “Cautionary Note Concerning Reserve & Resource Estimates” and “Mineral Reserve and Mineral Resource” table on the Company’s website.

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Cautionary Note to United StatesInvestors

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