VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 07/10/13 -- NOVAGOLD RESOURCES INC. (TSX: NG)(NYSE MKT: NG) announced results for its second quarter ended May 31, 2013 and updated the status of the permitting process for its flagship Donlin Gold project in Alaska. With approximately US$215 million in cash and cash equivalents at the end of the second quarter, NOVAGOLD is financially strong with more than sufficient cash to fulfill all of its current financial obligations, fund advancement of the Donlin Gold project all the way through the permitting process to a construction decision, as well as support this year's exploration program and ongoing activities at its Galore Creek project in British Columbia.
Details of the Company's financial results are described in the Unaudited Interim Condensed Consolidated Financial Statements and Management's Discussion and Analysis (MDA) which, together with further details on each of the Company's projects, including resource and reserve estimates, will be available on the Company's website at www.novagold.com, on SEDAR at www.sedar.com, and on EDGAR at www.sec.gov. All amounts are in Canadian dollars unless otherwise stated and all resource and reserve estimates are shown on a 100% project basis.
During the Second Quarter in 2013, NOVAGOLD:
-- Completed the Donlin Gold Public Scoping component of the NEPA process with positive and constructive reviews in all public meetings-- Submitted comprehensive Donlin Gold environmental and social baseline data to the US Army Corps of Engineers (the Corps), the lead permitting agency, to enable preparation of the Environmental Impact Statement (EIS)-- Met with the Corps and cooperating permitting agencies in Alaska to review essential Donlin Gold data which will facilitate the NEPA process-- Continued to update Galore Creek's resource model and launched the 2013 exploration program-- Reduced convertible debt by US$72.8 million; the remaining balance of US$22.2 million is due May 1, 2015
Notwithstanding the share price and the continued market conditions challenging mining equities, we find ourselves in a better position as a company than we had hoped. In less than two years' time and ahead of the recent market decline, we completed the Company's reorganization and the divestiture of non-core assets; streamlined expenses, reduced the debt and further strengthened the balance sheet; built a management with expertise in developing and operating large-scale projects; de-risked Donlin Gold and Galore Creek; as well as progressed our permitting and exploration activities as planned. With these actions, we have effectively positioned the Company to benefit tremendously from what we anticipate will be a very bullish environment for gold in the coming years.
NOVAGOLD is one of very few mine developers with assets located in two of the safest geo-political jurisdictions in the world. As investors who are looking for exposure to gold become more focused on jurisdictional safety and stability, we expect NOVAGOLD to be recognized as the investment of choice among institutions seeking "premium valuation" with projects characterized by size, superior grades and jurisdictional safety. Donlin Gold, with approximately 34 million ounces of gold in Proven and Probable reserve categories and, by today's standards, with exceptionally high-grade for a large-scale bulk mining operation of 2.1 grams per tonne, is one of the world's most valuable undeveloped open-pit gold deposits. Once in operation, it is expected to produce approximately 1,500,000 ounces of gold per year in the first five full years of production. Assuming no future expansions, it is expected to average well over 1,000,000 ounces per year over its present 27-year life, making it one of only six gold mines in the world that produce or which have the potential to produce in excess of one million gold ounces per year. With a mine life already measured in decades, Donlin Gold's exploration potential beyond the known three-kilometer portion of an eight-kilometer ore-bearing strike length has the potential to extend the mine life significantly. Assets like Donlin Gold are rare.