Q1 2025 NovaGold Resources Inc Earnings Call
Operator: Thank you for standing by. This is the conference operator.
Thank you for standing by this is the conference operator, welcome to the Evercore first quarter 'twenty 25 financial results conference call and webcast.
Operator: Welcome to the NoveGold First Quarter 2025 Financial Results Conference Call and Webcast. As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star, then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star, then 0. Webcast viewers may submit questions through the text box in the lower right corner of the webcast frame. Should you need assistance during the conference call, you may signal an operator by pressing star then zero.
As a reminder, all participants are in listen only mode and the conference is being recorded.
After the presentation, there will be an opportunity to ask questions.
Speaker Change: I joined the question queue, you May Press Star then one on your telephone keypad.
Speaker Change: Do you need assistance during the conference call you May signal, an operator by pressing Star then zero.
Castillo Rhodes: That's Castillo Rhodes myself my question through the text box in the lower right corner of the webcast Spain.
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Melanie Hennessey: I would now like to turn the conference over to Melanie Hennessey, Vice President, Corporate Communications. Please go ahead. Good morning, everyone.
Castillo Rhodes: I would now like to turn the conference over to Melanie Hennessey, Vice President Corporate Communications. Please go ahead.
Speaker Change: Good morning, everyone. We are pleased that you have joined US for Nova goal 2025, first quarter webcast and conference call and for an update on the Donlin Gold project.
Melanie Hennessey: We are pleased that you have joined us for NoveGold 2025 first quarter webcast and conference call and for an update on the Donlan Gold Project.
Melanie Hennessey: On today's call, we have NoveGold's President and CEO, Greg Lang, and Peter Adamek, NoveGold's Vice President and CFO.
Greg Lang: On today's call, we have <unk>, president and CEO, Greg Lang, and Peter Animal Knowable, Vice President and CFO.
Melanie Hennessey: At the end of the webcast, we will take questions by phone. Additionally, we will respond to questions received by email.
Greg Lang: At the end of the webcast, we will take questions by phone. Additionally, we will respond to questions received by email.
Melanie Hennessey: I would like to remind you, as stated on slide 3, any statements made today may contain forward-looking information such as projections and goals, which are likely to involve risks detailed in our various EDGAR and CDAR filings, and forward-looking disclaimers included in this presentation.
Greg Lang: I would like to remind you as stated on slide three.
Greg Lang: Any statements made today may contain forward looking information such as projections and goals, which are likely to involve risks detailed in our various Edgar and SEDAR filings and forward looking disclaimers included in this presentation.
Melanie Hennessey: Thank you.
Greg Lang: 1 I will now turn the presentation over to our President and CEO, Greg Lang. Thank you, Melanie. NoveGold is solely focused on the Donovan asset up in Alaska. some of the key attributes that the Donlan project had. You know, it's large, almost 49 ounces of gold and a grade of two and a quarter grams. It'll be a large mine, its production will average over a million ounces a year. over a mine life measured in decades. The project is big now, but there is significant exploration potential, a long strike, and a depth. We're up in Alaska.
Speaker Change: I will now turn the presentation over to our President and CEO, Greg Lang Gray.
Speaker Change: Thank you Melanie.
Speaker Change: No. The goal is solely focused on the dominant asset up in Alaska.
Speaker Change: Some of the key attributes of the Donlin project has.
Speaker Change: Yeah, it's large almost 40 million ounces of gold at a grade of two in a quarter grams.
Speaker Change: It'll be a large mine production will average over a million ounces a year.
Speaker Change: Over a mine life measured in decades.
Speaker Change: The project is big now.
Speaker Change: There are significant exploration potential along strike and at depth.
Yes.
Speaker Change: We're up in Alaska.
Greg Lang: a world-leading mining jurisdiction. with a well-established industry. and in a state that supports responsible mining. Our project is owned by two Alaska Native corporations, Chalista and TKC. Our partnership with them has endured for many years. The federal permit are in hand and we're wrapping up the state permit. We remain committed. to Environmental Storage Ship and Responsible Governance and Development. We've got an experienced management team that has the expertise. to continue to advance the Donovan project. and we enjoy strong shareholder support. from our institutional investors.
Speaker Change: Our world leading mining jurisdictions.
Speaker Change: With a well established industry.
Speaker Change: And in a state that supports responsible mining.
Speaker Change: Our project is owned by two Alaska Native corporations, <unk> and Teekay see our partnership with them.
Speaker Change: Endure for many years.
Speaker Change: The federal permit.
Are in hand, and we're wrapping up the state permits.
Speaker Change: We remain committed.
To environmental stewardship, and responsible governance and development, we've got an experienced management team that has the expertise.
Speaker Change: To continue to advance the Donlin project.
Speaker Change: And we enjoy strong shareholder support.
Speaker Change: From our institutional investors.
Greg Lang: Looking at slide six. Donovan will average over a million ounces a year of production throughout its life. This is twice. The Industry Average. and the largest producer in the development pipeline throughout the industry. As global production declines, the demand for high quality assets like Donlan will continue to increase. at Two and a Quarter Grounds.
Speaker Change: Looking at slide six.
Robert will average over a million ounces a year production.
Speaker Change: Throughout its life.
Speaker Change: This is twice.
Speaker Change: The industry average.
Speaker Change: And the largest producer in the development pipeline throughout the industry.
Speaker Change: As global production declines.
Speaker Change: Demand for high quality assets like Dan Donlan.
Speaker Change: Continued to increase.
Speaker Change: And two in a quarter grounds.
Greg Lang: The mine graded Donovan is better than twice the industry average. its high grade and longevity. well position it to thrive through any gold cycle. imaginable.
Speaker Change: The mine grade of Donlin is better than twice the industry average.
Speaker Change: It's high grade and longevity.
Speaker Change: While positioning it to.
Speaker Change: To thrive through any gold cycle.
Speaker Change: Imaginable.
Greg Lang: The current slide depicts the exploration potential at Donlon. The 40 million ounce resource is contained in the ACMA and Lewis Mining Pits. That area represents only three kilometers of an eight kilometer system. And we've got gold bearing drill holes all up and down trend. That's right, we will resume exploration and there is the potential to substantially increase the endowment at Donlon.
Speaker Change: The current slide depicts the exploration potential at Donlin.
Speaker Change: The 40 million ounce resource is contained in the asthma and Louis mining pits.
Speaker Change: That area represents only three kilometers of an eight kilometer system.
Speaker Change: And we've got Goldberg drill holes, all up and down trend.
Speaker Change: Right, we will resume exploration and there is the potential to substantially increase the endowment is down.
Speaker Change: Okay.
Greg Lang: Alaska is the second largest gold producing state in the United States. has almost $5 billion in annual revenue from non fuel mineral production. The industry in Alaska generates over a billion dollars a year in goods and services. This results in 12,000 high-paying jobs for the local economy.
Speaker Change: Alaska is the second largest gold producing state in the United States.
Speaker Change: It has almost $5 billion.
Speaker Change: In annual revenue from non fuel retail production.
Speaker Change: The industry in Alaska.
Speaker Change: Generally it's over $1 billion, a year in goods and services.
Speaker Change: This results in 12000 high paying jobs for the local economy.
Greg Lang: A recent executive order aims to strengthen Alaska's position and encourage resource development. This initiative will drive new opportunities for gold mining, job creation, and economic expansion. which will enhance investor confidence aligning well with Don and Gold's potential.
Speaker Change: Our recent executive order aims to strengthen <unk> position in it.
Speaker Change: <unk> resource development.
Speaker Change: This initiative will drive new opportunities for gold mining job creation.
Speaker Change: And economic expansion.
Which will enhance investor confidence aligning well.
Speaker Change: With Donlin golds potential.
Greg Lang: Turning to slide 10. The land at Donlon is owned by two Alaska native corporations. Chelysta owns the mineral rights and TKC owns the surface rights. They share their elders vision for responsible mineral development. their expertise and stewardship.
Speaker Change: Turning to slide 10.
Speaker Change: Ran the Donlin is owned by two Alaska Native corporations <unk> owns the mineral rights and Teekay C owns the surface rights.
Okay.
Speaker Change: Okay sure there's older their elders vision for responsible mineral development.
Speaker Change: Their expertise and stewardship.
Greg Lang: grounded in a deep understanding of the significance of the land to their people are crucial to responsible economic development and long-term benefits for the YK region where their communities are located. Permitting in the United States. is a long term. rigorous process. and we have substantially completed it. Our federal permits are in hand and our state permits are well adapted. The only remaining state permit of any consequence is for the tailings dam. And this work is well underway. We have secured these permits and we are actively supporting the agencies in maintaining and defending these permits.
Speaker Change: Grounded in a deep understanding of the significance of the land because there are people are crucial to responsible economic development and long term benefits for the Y K region, where their communities are located.
Speaker Change: Permitting in the United States.
Speaker Change: It's a long term rigor.
Speaker Change: Rigorous process and we have substantially completed it.
Our federal permits are in hand, and our state permits are well advanced.
Speaker Change: The only remaining state permit of any consequence is for the tailings dam.
Speaker Change: And this work is well underway.
Speaker Change: We have secured these permits.
Speaker Change: We are actively supporting the agencies and maintaining and defending these permits.
Greg Lang: This process has required extensive community engagement throughout. NoveGold has made significant strides. in Environmental Stewardship. and good government.
Speaker Change: This process is required extensive community engagement throughout.
Speaker Change: No. The goal has made significant strides.
Speaker Change: And environmental stewardship.
Speaker Change: And good governance.
Greg Lang: We will be shortly publishing our new sustainability report.
Speaker Change: We will be shortly publishing our new sustainability report.
Greg Lang: Safety has been a top priority at Donovan. And the project has a record of no lost time accidents in well over a decade. We're very proud of our accomplishments in this area.
Speaker Change: Safety.
Speaker Change: Has been a top priority at Donlin.
Speaker Change: And the project.
Speaker Change: Achieved.
Speaker Change: Our record of no lost time accidents, and well over a decade, we're very proud of our accomplishments in this area.
Greg Lang: NoveGold has a very experienced management team. All of us come from major mining corporations. and have the expertise. to take Donlin forward.
Speaker Change: <unk> has a very experienced management team.
Speaker Change: All of us come from major mining corporations.
Speaker Change: And have the expertise to.
Speaker Change: To take Donlin forward.
Greg Lang: We also enjoy strong institutional shareholder support. Over 70% of our shares are held with our top 10 shareholders. They share our vision for responsible, long term development, and we are extremely grateful for their support. and their focus on helping us maintain. and maximize the project's value.
Speaker Change: We also enjoy a strong institutional shareholder support.
Speaker Change: Over 70% of our shares are held with our top 10 shareholders.
Speaker Change: They share our vision for responsible long term development and we are extremely grateful for their support.
Speaker Change: And their focus on helping us maintain.
Speaker Change: And maximize the projects throughout the year.
Speaker Change: Okay.
Greg Lang: These are unprecedented times. when it comes to gold price. It's hitting new records every week.
Speaker Change: These are unprecedented times.
Speaker Change: When it comes to gold price is hitting new records every week.
Greg Lang: Don and gold brings exceptional leverage in a jurisdiction where you can keep it. at an undiscounted rate, the current spot price. yields over $40 billion. This underscores the very significant economic potential at Donner.
Speaker Change: Donlin gold brings exceptional leverage in a jurisdiction where you can keep it.
Speaker Change: As a man discounted rate.
Speaker Change: Current spot price.
Speaker Change: Yields over $40 billion.
Speaker Change: This underscores the very significant economic potential at dawn.
Greg Lang: Turning to the first quarter highlights.
Speaker Change: Turning to the first quarter highlights.
Greg Lang: The Camp O'Donnelly was opened. in early earlier this year and drilling commenced in March. We have a program of 15,000 meters planned for the year, initially focused on grid drilling to enhance our understanding of the parameters that will support mine planning that will ultimately feed into an updated feasibility study. NoveGold and Donovan staff have traveled to Juneau to meet with members of Alaska's congressional delegation to share information about Donovan. and reinforce the project's importance to Alaska. and the YK Region. We also presented in Juneau to the Alaska House of Representatives Energy Committee. to describe the project's energy needs and to discuss Alaska's environmental standards.
Speaker Change: The cap the dominant was opened.
Speaker Change: And early earlier this year and drilling commenced in March.
Speaker Change: We have a program of 15000 meters planned for the year initially focused on grid drilling too.
To enhance our understanding of the parameters that will support mine planning that will ultimately feed into an updated feasibility study.
Speaker Change: Yeah.
Speaker Change: Silver gold and Gotland staff and <unk>.
Speaker Change: To Juno to meet with members of last skirts congressional delegation to share information about Dominic.
Speaker Change: And reinforce.
Speaker Change: The project's importance to Alaska.
Speaker Change: And the Y K region.
Speaker Change: We also presented in journal.
Speaker Change: The Alaska House of Representatives Energy Committee.
Speaker Change: To describe the projects energy needs and to discuss.
Speaker Change: <unk> environmental standards.
Greg Lang: In collaboration with our native villages, we provided financial assistance to maintain the ice road on the Kuskokwim River, allowing the people in that region safe access between the villages. We continue to support local community events, such as the Don and Gold basketball tournament. and the Kuskokwim 300 Sled Dog Race, where we sponsor three mushers from the YK region. We anticipate that we will receive comments from the agencies on the Preliminary Dam Certification package that was recently submitted. The state water permits have been extended. In the litigation related to our permits, we continue to support Donlan in the state permits, and all of these cases have been fully briefed.
Speaker Change: In collaboration with our maintenance villages, we provided financial assistance to maintain the ice road on the Kuskokwim River.
Speaker Change: Allowing the people in that region safe access between the villages.
Speaker Change: Yeah.
Speaker Change: We continue to support local community events, such as the Donlin Gold basketball tournament.
Speaker Change: And the Costco Club 300, sled dog race, where we sponsored three mushers from the Y K region.
Speaker Change: We anticipate that we will receive comments from the agencies on the preliminary dam certification project package that was recently submitted.
Speaker Change: The state water permits have been extended.
Speaker Change: In the litigation related to our permits we continue to support <unk> in the state permits and all of these cases have been fully briefed.
Greg Lang: In federal litigation, the court ordered supplemental briefing on the remedy that was completed in March, and oral arguments will take place on April 14. With a thorough understanding of the regulatory and legal landscape, Don and Gold and its partners are committed to supporting and defending the permits that have been granted by the agency.
Speaker Change: And federal litigation.
Speaker Change: Court ordered supplemental briefing on the remedy that was completed in March and oral arguments will take place on April 14th.
Speaker Change: With a thorough understanding of the regulatory and legal landscape.
Speaker Change: Gold and its partners are committed to supporting and defending the permits that have been granted by the agencies.
Peter Adamek: With that, I will now turn the call over to Peter Adamek, our Chief Financial Officer. Peter? Thank you, Greg.
Peter: With that I will now turn the call over to Peter out of Iraq.
Peter: Our Chief Financial Officer Peter.
Speaker Change: Thank you Gregg turning to slide 20, our net loss in the first quarter of 2025 decreased by $1 2 million from the comparative 2024 quarter, primarily due to lower stock based compensation expense and.
Peter Adamek: Turning to slide 20, our net loss in the first quarter of 2025 decreased by $1.2 million from the comparative 2024 quarter, primarily due to lower stock-based compensation expense and lower Donlan Gold expenditures, partially offset by lower interest income. Other than stock-based compensation expense, which declined by $1.4 million in the quarter, general and administrative costs during the quarter were in line with the comparative 2024 period.
Speaker Change: And lower Donlin gold expenditures, partially offset by lower interest income.
Speaker Change: Okay.
Speaker Change: Other than stock based compensation expense, which declined by $1 4 million in the quarter general and administrative costs during the quarter were in line with the comparative 2024 period.
Speaker Change: Okay.
Peter Adamek: On slide 21. Cash and term deposits decreased by $8.2 million.
Speaker Change: On slide 21.
Speaker Change: Cash and term deposits decreased by $8 2 million.
Peter Adamek: with corporate and administrative costs and our share of Donland Gold expenditures partially offset by interest income as well as approximately $1 million in proceeds from the sale of marketable securities. Compared to prior year, Donlon Gold's first quarter funding was unchanged as Donlon Gold site activities related to the 2025 field program only commenced late in the quarter.
Speaker Change: With corporate and administrative costs and our share of Donlin gold expenditures, partially offset by interest income as well as approximately $1 million in proceeds from the sale of marketable securities.
Speaker Change: Compared to prior year Donlin Gold's first quarter funding was unchanged as Donlin gold site activities related to the 2025 field program only commenced late in the quarter.
Peter Adamek: Turning to slide 22, our treasury remains robust with cash and term deposits.
Speaker Change: Turning to slide 22, our treasury remains robust with cash and term deposits.
Peter Adamek: totaling $93 million at the end of the first quarter of 2025. Our first quarter cash expenditures remain on track to meet our 2025 budget and guidance. Donland Gold expenses in the first quarter of 2025 were below the quarterly run rate implied by our 2025 guidance as Donland Gold site activities related to this year's field program only commenced late in the quarter. We expect Don and Gold expenditures to ramp up in the second and third quarters.
Speaker Change: Totaling 93 million at the end of the first quarter of 2025.
Speaker Change: Our first quarter cash expenditures remain on track to meet our 2025 budget and guidance.
Speaker Change: Donlin gold expenses in the first quarter of 2025 were below the quarterly run rate implied by our 2025 guidance as Donlin gold site activities related to this year's field program only commenced late in the quarter.
Speaker Change: We expect donlin gold expenditures to ramp up in the second and third quarters.
Peter Adamek: Our anticipated expenditures for 2025 remain unchanged at approximately $37.5 million, including $21.5 million for Donlin and $16 million for Corporate G&A.
Speaker Change: Our anticipated expenditures for 2025 remain unchanged at approximately $37 5 million, including $21 5 million for Donlin and 16 million for corporate G&A.
Greg Lang: And with that, I'll now turn the presentation back over to Greg.
Greg Lang: And with that I'll now turn the presentation back over to Greg.
Greg Lang: Thank you, Peter. The Diamond and Gold Project budget for this year is $43 million. in addition to the drilling. We will continue geotechnical and geoscience work and project planning. We will advance the dam safety certificates and our very active community relations, government affairs and permits. support will continue. NoveGold's priority. remains focused. on the work necessary to ultimately support a new bankable feasibility study. With a strong treasury of approximately $93 million, NoveGold is well positioned to fund our activities for the coming years.
Greg Lang: Thank you Peter.
Speaker Change: The Donlin Gold project budget for this year is $43 million.
Greg Lang: In addition to the drilling.
Greg Lang: We will continue geotechnical and geoscience work and project planning.
Greg Lang: We will advance the dam safety certificates and are very active community relations government affairs and permits.
Greg Lang: Support will continue.
Greg Lang: <unk> priority.
Greg Lang: Remains focused on.
Greg Lang: The work necessary to ultimately support.
Greg Lang: New bankable feasibility study.
Greg Lang: With a strong treasury of approximately $93 million <unk> is well positioned to fund our activities for the coming years.
Greg Lang: The path for Donlin is clear. We've got a lot of patience, we've got great partnerships, and an unrelenting focus. on the long term value of diamond.
Greg Lang: The path for Donlin is clear.
Greg Lang: A lot of patients great partnerships and an unrelenting focus on the long term value of Donlin.
Greg Lang: To recap my presentation. Diamond and gold is unique in the gold space. with a production profile of over a million ounces a year for almost three decades. The grade is exceptional, and the exploration potential along strike and at depth is unique. the jurisdictional safety of Alaska, particularly in light of the new executive orders. is immense and a key attribute in future investment in the state. We are steadfast in our relationships and collaboration with our Native partners. Our permits are in hand. We remain committed to the environment and social and governance issues. and we have an experienced team.
Greg Lang: To recap my presentation.
Greg Lang: Donlin gold is unique in the gold space.
Greg Lang: With the production profile of over a million ounces a year for almost three decades.
Greg Lang: The grade is exceptional and the exploration potential along strike and at depth is unique.
Greg Lang: The jurisdictional safety of Alaska, particularly in light of the new executive orders.
Greg Lang: Is immense.
Greg Lang: Key attribute and future investment in the state.
Greg Lang: We are steadfast in our relationships and collaboration with our native partners. Our permits are in hand, we remain committed to the environment, social and governance issues.
Greg Lang: And we have an experienced team.
Greg Lang: that can take this project forward.
Greg Lang: It can take this project forward.
Greg Lang: And finally, we appreciate the longstanding support of our shareholders.
Greg Lang: And finally, we appreciate the longstanding support of our shareholders.
Greg Lang: We will now open the call for questions. Thank you.
Greg Lang: We will now open the call for questions.
Greg Lang: Thank you we will now.
Operator: We will now begin the question and answer session.
Greg Lang: Began the question and answer session will join the question queue. You May Press Star then one on your telephone keypad Hello here at town acknowledging your request if youre using a speakerphone. Please pick up your handset before pressing any key.
Operator: To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two.
Greg Lang: Italia question. Please press Star then two.
Nick Giles: The first question comes from Nick Giles with B Reilly, please go ahead. Good morning, everyone. Thank you very much, Operator.
Speaker Change: The first question comes from Mikhail <unk>.
B Riley: B Riley. Please go ahead.
Speaker Change: Good morning, everyone. Thank you very much operator.
Fedor Shabalin: This is Fedor Shabalin on behalf of Nick Giles. Greg and the team, congrats on the progress in the quarter.
Speaker Change: This is further shuttle and on behalf of Nik child.
Speaker Change: Greg and the team congrats on the progress in the quarter. My first question is about the court's ruling and come in.
Greg Lang: My first question is about the court's ruling and the upcoming argument on April 14. What would be the next steps, and what are your expectations for the hearing regarding the evaluation of a larger theoretical release from Dolan Gold's tailings storage facility? And how strong is their position, if we can call it that way?
Speaker Change: Augment on April 14.
Speaker Change: It would be the next steps.
Speaker Change: What are your expectations for the hearing regarding the evolution of <unk>.
Speaker Change: Of the larger theoretical relief from Donlin Gold's tailings storage facility.
Speaker Change: And how strong is that position if we can call it that way. Thank you.
Greg Lang: Thank you. Well, good morning, Nick, and thank you for joining our call. You know, the question you posed pertains to the litigation that's ongoing in federal court regarding our 404 permit. You know, the The issue was during the preparation of the EIS, we did not study a massive failure of the tailings dam, we just studied, you know, partial failure, which we thought was adequate considering the design of the dam, which is all downstream construction rock fill. But it was rather than, you know, push back on that, the Corps of Engineers decided to, yes, let's just do the additional study.
Yeah.
Speaker Change: Okay.
Speaker Change: Well good morning, Nick and thank you for joining our call.
Speaker Change: The question you posed pertains to the litigation that's ongoing in federal court regarding our.
Speaker Change: 404 permit.
Speaker Change: The.
Speaker Change: The issue it was during the preparation of the Elas, we did not study a massive failure of the tailings dam, we just studied.
Speaker Change: Partial failure, which we thought was adequate considering the design of the dam, which is all downstream construction Rockville.
Speaker Change: But it was rather than <unk>.
Speaker Change: Pushback on that.
Speaker Change: Core of engineers decided to yes, let's just due to the additional study so the argument before the courts right now is just to define that study.
Greg Lang: So the argument before the courts right now is just to define that study, and, you know, we both sides will file their briefs later this month, and then we will wait for a ruling. You know, it's not an issue that I'm overly concerned by, you know, the judge's ruling was very narrow in the work they wanted the Corps to do, and so we'll, you know, it will take probably six, eight months to get that work done, and then the court will... take whatever time they need to make a ruling. And that's always a bit unpredictable.
Speaker Change: Yes.
Speaker Change: We both sides profile their briefs later this month and then we will wait for a ruling.
Speaker Change: Not an issue.
Speaker Change: Overly concerned by.
Speaker Change: So the judges ruling was very narrow in the work. They wanted according to do and so will it will take probably six eight months to get that work done and then the court will.
Speaker Change: Okay, whatever time, they need to to make a ruling and that's always a bit unpredictable, but the court cases evolve so far have gone very well.
Greg Lang: But the court cases have all so far gone very well. And I anticipate they will continue to go well. And it's not really anything that's on our critical path. So we'll navigate those in due course.
Speaker Change: I anticipate they will continue to go well and it is not really anything that's on a critical path.
Speaker Change: So we will navigate those in due course.
Speaker Change: Great to hear thank you and the second one is.
Greg Lang: You already started the field program and drilling.
Speaker Change: So you you'll have you already started the field program and drilling.
Greg Lang: Can you talk a bit about the modifying factors for converting mineral resources to mineral reserves and how the project might be revalued considering these conversions? With conversions, higher gold prices and potential inflationary corrections. Okay, well, the first phase of the drill program is fairly tightly spaced drilling, you know, almost on a spacing that you would use for or control if you were mining. So we're using the data from this drilling to really fine-tune bench heights, mining widths, and so on. So it's really more of a fine-tuning exercise.
Speaker Change: Can you talk a beta bulbs and modifying factors for converting mineral resources to mineral reserves and how that project might be.
Speaker Change: Considering these conversions.
Speaker Change: With conversions higher gold prices and.
Speaker Change: So the potential inflationary corrections.
Speaker Change: Well the first.
Speaker Change: First phase of the drill program is fairly tightly spaced drilling.
Speaker Change: Almost on a spacing that you would use for where control. If you were mining. So we're using the data from this drilling to really fine tune your bench heights mining width and so on so it's really more of a fine tuning exercise the second part of the drug and that's what where we're drilling now the second part of the program.
Greg Lang: The second part of the drill program, and that's what we're drilling now, the second part of the program is, you know, there's areas in and around the known ore bodies where the drill spacing isn't adequate to calculate a reserve or a resource. So some of the holes will fill in some of the areas of light drilling. And, you know, the goal is to update or upgrade some of the inferred material. and we'll be, you know, guiding everybody as our results come in.
Speaker Change: As you know there is areas in and around the.
Speaker Change: The known ore bodies, where the drill spacing isn't adequate to calculate our reserve or resource. So some of the holes will fill in some of the areas like drilling.
Speaker Change: The goal is to update upgrade.
Speaker Change: Some of the inferred material.
Speaker Change: And we will be.
Speaker Change: Guiding everybody is our results come in.
Nick Giles: I appreciate the color, Greg, and the team, continue best of luck and turn it over for now. Thank you. Thanks, Nick.
Speaker Change: I appreciate the color, Greg and the team continued best of luck and turning it over for now thank you.
Greg Lang: Thanks, Nick.
Andy Skopik: The next question comes from Andy Skopik, Private Investor. Please go ahead. Good morning. A couple of questions I'd like to ask.
Speaker Change: The next question comes from Andy <unk> private Investor. Please go ahead.
Andy: Good morning couple of questions I'd like to ask you've made reference to a fully bankable feasibility study and I'd like to ask if you could estimate the cost of completing such a feasibility study and give any indication.
Greg Lang: You've made reference to a fully bankable feasibility study, and I'd like to ask if you could estimate the cost of completing such a feasibility study and give any indication of the timeline for completion. Well, I'll break that into parts. The estimated cost for a full bankable feasibility study is about $80 to $100 million, and it's an undertaking that would require approximately two years. The owners of Donlan, us, and Barrick have not reached that decision yet. I think our main focus right now really is get the drilling done. And based on that, we'll have more data on which to make a decision on the feasibility study.
Speaker Change: <unk> of the timeline for completion.
Andy: Well I'll break that into into part B.
Andy: The estimated cost for a full bankable feasibility study is about $80 million to $100 million and it's an undertaking that will require approximately two years.
Andy: The owners of Donlin that Barrick have not reached that decision yet I think our main focus right now really is get the drilling done and.
Andy: Based on that we will have more data on which to make a decision on the feasibility study.
Peter Adamek: Okay, question for Peter. Given the budget that you put forward for this current year, what is your projected use of cash?
Speaker Change: Okay a question for Peter.
Andy: Given the budget that you've put forward for this current year.
Speaker Change: What is your projected use of cash.
Peter Adamek: I thank you, Andy, for the question. Our budget was $37.5 million split between 2016 for NoveGold G&A, cash G&A, if you will. and the remainder is $21.50 for Don. Our use of cash principally is to fund those two activities and that's a little bit offset by interest income on the cash we have on deposit.
Speaker Change: Well I. Thank you Andy for the question.
Speaker Change: You know our budget was 37 $5 million split between 16 for Nova Gold's G&A cash G&A, if you will.
Speaker Change: And the remainder is 20 154 for Donlin. So our use of cash principally is to fund those two activities and that's a little bit offset by interest income on the cash we have on deposit.
Speaker Change: Okay.
Greg Lang: Come back to you Greg for one more you know I've been.
Greg Lang: I've been familiar with this story for quite some time, and although I am a retired investor now, I did meet Tom Kaplan in New York at a presentation probably close to a dozen years ago now. This has been a development company for a long time, and I think investors are just getting more than a little impatient with how slow things seem to be developing. You do have a partner in Barrick, and I just really wonder to what extent The development. of this project is the pace is going to start to pick up. Well, you know, as I mentioned in my remarks, we're working with our partner to, you know, complete this drill program and, you know, incorporate the results into our understanding of mining methods.
Speaker Change: For me I've been familiar with the story for quite some time.
Speaker Change: Although I am a retired investor now I did meet Tom Kaplan in New York at a presentation, probably close to a dozen years ago. Now. This is this has been a developing company for a long time and I think you know investors.
Speaker Change: Or just getting a.
Speaker Change: A little impatient with how slow things seem to be developing and you do have a partner and Barrick and I, just really wonder to what.
Extent.
Speaker Change: The development.
Speaker Change: Of this project is the pace is going to start to pick up.
Speaker Change: Well, yeah as I mentioned in my remarks, we're working with our partner <unk>.
Speaker Change: Complete this drill program and.
Speaker Change: Incorporate the results into our understanding of mining.
Greg Lang: You know, this work will be done, probably largely finished drilling, you know, late May, early June and in a month or two to, you know, digest the closed space drilling and then we'll be in a position to move forward. Certainly gold at record high prices is a motivator, but, you know, right now we're taking it one step at a time and we're continuing to work with Barrick.
Speaker Change: Mining methods.
Speaker Change: This work will be done probably largely finished drilling.
Speaker Change: Late May early June in a month or two to digest the close space drilling and then we'll be in a position to move forward certainly gold at record high prices as a as a motivator, but yeah right now we're taking it one step at a time and we're continuing to work with Barrick.
Andy Skopik: All right, thank you very much.
Speaker Change: Alright, Thank you very much.
Greg Lang: We have a few questions coming in from the line. The first is, can you comment on the resource and how much of it is refractory? Well, the Donlan ore body is essentially oligopractory. You know, there's some oxide near surface, but, you know, that's relatively insignificant. You know, the flow sheet at Donlan is to flow to concentrate and treat the concentrate in the autoclave and then subsequently leach the gold. So it's very, very common in the industry. We're, you know, certainly Richard Williams, our engineering vice president and chief operating officer, has, you know, probably 30 years experience working with autoclaves.
Speaker Change: We have a few questions coming in from the line and the.
Speaker Change: First is can you comment on the resource and how much of that is refractory.
Speaker Change: The donlin ore body is essentially all of refractory yes, there are some oxide near surface, but yeah. That's.
Speaker Change: Relatively insignificant the flow sheet at Donlin is too slow to concentrate and treat the concentrate in the autoclave and then subsequently leach the goal. So it is very very common in the industry.
Speaker Change: <unk>.
Speaker Change: We're certainly Richard Williams, our engineering Vice President.
Speaker Change: Chief operating officer has.
Speaker Change: Probably 30 years experience working with other claims so it's a technology that's.
Greg Lang: So it's a technology that's been demonstrated to be reliable for decades in the mining industry and one that our team is very familiar with.
Speaker Change: Been demonstrated to be reliable for decades in the mining industry and one that our team is very familiar with.
Greg Lang: Great. And then the last question from the line is, given the current Treasury, is there any future needs for funding and is that linked to litigation? Well, our Treasury, as Peter mentioned in his remarks, our Treasury is robust and we've got more than sufficient funds to see us through this year. And regarding the litigation, we are working our way through it and supporting the Army Corps of Engineers, the State of Alaska, and the Bureau of Land Management in defending the rigorous work they did on those permits. So I think it's something we need to work through, but it's really not a critical item for us.
Speaker Change: Great and then the last question from the line.
Speaker Change: Is and given the current.
Speaker Change: The Treasury is there any future needs for.
Speaker Change: For funding and is that linked to litigation.
Speaker Change: Well our Treasury S.
Speaker Change: As Peter mentioned in his remarks, our treasury is robust and.
Speaker Change: We've got more than sufficient funds to see us through this year and regarding the litigation.
Speaker Change: We are working our way through it and supporting the Army Corps of engineers, the state of Alaska, and the Bureau of land management in defending the rigorous work. They did on those permits. So I think it's something we need to work through but it's really not a critical item for us we have.
Greg Lang: You know, we have the courts of rule in our favor every step of the way, and we expect that will continue.
Speaker Change: The courts have ruled in our favor every step of the way and we expect that will continue.
Ravi Nizami: The next question comes from Ravi Nizami with National Bank Financial. Please go ahead. Good morning, everyone. Thanks for taking my call.
Speaker Change: Next question comes from Robbie Nozomi with National Bank Financial Please go ahead.
Robbie Nozomi: Good morning, everyone. Thanks for taking my call.
Speaker Change: So Greg just give.
Greg Lang: Greg, just given the strength in gold prices that we have at all-time highs, can you just speak a bit towards how this environment influences your decision-making or the pace of prioritization on this project, whether that comes to permitting or moving forward on the feasibility? Thank you.
Speaker Change: The strength in gold prices that we have at all time highs can you just speak a bit towards.
Speaker Change: All of this environment influences your decision, making or the pace of prioritization.
Speaker Change: This project, whether they come to permitting or or.
Speaker Change: Moving forward on the visibility.
Speaker Change: Thank you.
Greg Lang: I think, I'm not sure I fully understand your question. Well, first off, thank you for joining us. you know, we are probably the most important thing we need to do in the coming months is execute on our drill program and continue to, you know, we engage with the communities and our other stakeholders. So that's really our focus. I think, you know, gold prices, where they are now, certainly Donlan looks just, you know, very, like a very compelling investment. I think we're going to take this one step at a time, finish the drill program, fine tune our mining methods, and that will then position the owners in a place to make a decision on the next step.
Speaker Change: I think I'm not sure I fully understand your question well first off thank you for joining us.
Speaker Change: We are probably the most important thing we need to do in the coming months is execute on our drill program and continue to engage with the communities and our other stakeholders. So that's really our focus I think gold prices, where they are now certainly donlin looks just like a <unk>.
Speaker Change: Very compelling investment.
Speaker Change: We're going to take this one step at a time finished the drill program fine tune our mining methods and that will then position the owners in a place to make a decision on the next steps.
Operator: This concludes the question and answer session.
Speaker Change: This concludes the question and answer session.
Greg Lang: I would like to turn the conference back over to Greg Lang for any closing remarks. Please go ahead. Well, everyone, thank you for taking the time to join our Q1 call this morning and we look forward to updating everyone. as we advance the work at DotLimb this year. Thank you.
Speaker Change: I would like to turn the conference back over to Greg Lang for any closing remarks. Please go ahead.
Greg Lang: Well everyone. Thank you for taking the time to join our Q1 call. This morning, and we look forward to updating everyone.
Greg Lang: We advance to work it down this year.
Greg Lang: Thank you.
Greg Lang: Yeah.
Operator: This brings to a close today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.
Speaker Change: This brings to a close today's conference call. You may disconnect. Your lines. Thank you for participating and have a pleasant day.
Greg Lang:
Greg Lang: Sure.
Greg Lang: [music].
Greg Lang: Yes.
Greg Lang: Hum.
Greg Lang: [music].
Greg Lang: Okay.
Greg Lang: [music].