NovaGold Resources Inc.: Exhibit 99.1 - Filed by newsfilecorp.com
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News Release
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| TSX, NYSE-AMEX Symbol: NG |
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NovaGold Updates Plan to Spin-Out Ambler Project
into NovaCopper Shareholder Vote to Take Place March 28, 2012
February 21, 2012 - Vancouver, British Columbia - NovaGold
Resources Inc. (TSX, NYSE-AMEX: NG) (“NovaGold” or “the Company”) is pleased
to provide an update on the previously announced spin-out transaction (the
“Spin-Out”) of NovaCopper Inc. (“NovaCopper”), a wholly-owned subsidiary of the
Company. NovaCopper holds, through its wholly-owned subsidiary, NovaCopper US
Inc., the Company’s interest in the Ambler project located in Northwestern
Alaska.
The Spin-Out will be transacted by way of a statutory plan of
arrangement (the “Arrangement”) under the Companies Act (Nova Scotia). Pursuant
to the terms of the Arrangement, among other things, 100% of the outstanding
common shares of NovaCopper (“NovaCopper Shares”), will be distributed to
holders of common shares of NovaGold (the “NovaGold Shareholders”) such that
each NovaGold Shareholder of record on the effective date of the Arrangement
will receive one NovaCopper Share for every six common shares in the capital of
NovaGold held on the effective date. The Company’s options, performance share
units, and deferred share units (collectively, the “Compensation Securities”)
and warrants (the “Warrants”) will all be adjusted pursuant to the terms of the
Arrangement, the details of which will be more particularly described in the
Management Information Circular that will be mailed to NovaGold Securityholders
(as defined below).
The directors of the Company believe that the creation of two
separate public companies, one focused on gold and one focused on the
copper-dominant Ambler district, will enhance their respective business
operations and provide holders of NovaGold securities with additional investment
choices and enhanced flexibility. NovaCopper will be free of any debt to the
parent company and will be funded with US$40 million in cash.
Mr. Rick Van Nieuwenhuyse, the founder of NovaGold, who
recently assumed the position of President and Chief Executive Officer of
NovaCopper, said:
“I am very excited to be heading NovaCopper as we execute our
business plan to unlock the value of one of the world's most exciting copper
exploration investments. As we did so successfully with Donlin, now one of North
America's premier gold development projects, the strategy here is to create
extraordinary returns through the drill bit. We have an excellent team focused
on determining the extent of the mineralization at Ambler and, with four rigs on
the property; we should be able to complete 15,000 meters of drilling this
year."
Mr. Rick Van Nieuwenhuyse continued, expanding on the
investment thesis: "NovaCopper holds highly valuable assets. One of the deposits
along the Ambler belt, Arctic, had a net present value of between approximately
$500 million and $1,600 million, depending on metal prices, in the Preliminary
Economic Assessment filed May 10,20111. Yet, Ambler is more than just
Arctic; it is a major world-class poly-metallic district. This notion was
demonstrated very clearly by the recent drilling success at our Bornite deposit
when DDH RC11-187 encountered mineralization of 4% copper over 178 meters,
including a very significant high-grade intersection of 34.7 meters grading
11.4% copper. (See the Company’s press releases dated November 10, 2011 and
December 14, 2011) These are results that would rival any copper project in any
part of the world. Yet, at a time when resource nationalism and
jurisdictional instability are becoming ever greater risks to the copper
mining industry, these outstanding results come from a project in the United
States. Our ultimate objective is that the twin attributes of high grades from
multiple deposits, when combined with jurisdictional safety, will result in
NovaCopper being rated as the premier vehicle in its class.”
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A special meeting (“Meeting”) of NovaGold Shareholders, holders
of Compensation Securities and holders of Warrants (collectively, the
“Securityholders”) will be held on March 28, 2012 in the City of Vancouver at
which the Securityholders will be asked to vote on a special resolution
approving the Arrangement. The record date, being the date for determining
Securityholders entitled to receive notice of and vote at the Meeting, is
February 24, 2012. The effective date of the Arrangement is expected to be on or
about April 30, 2012. A further press release will be issued by the Company when
the exact effective date is known. As noted above, the effective date of the
Arrangement is the record date for determining NovaGold Shareholders who are
entitled to receive NovaCopper Shares.
The Spin-Out is subject to numerous conditions including
Securityholder and court approval, approval by, and listing of the NovaCopper
Shares on the TSX and NYSE-AMEX and completion of all regulatory filings
About NovaCopper
NovaCopper is focused on the Ambler district which hosts
world-class volcanogenic massive sulfide (“VMS”) deposits that contain copper,
zinc, lead, gold and silver. It is one of the richest and most-prospective
copper districts in one of the safest geopolitical jurisdictions in the world.
In 2011, NovaGold focused on two deposits in the Ambler district. The first was
the Arctic deposit and the second was the Bornite deposit. A Preliminary
Economic Assessment (“PEA”)1, produced in May 2011, determined that
the Arctic deposit contains indicated mineral resources of 17 million tonnes
grading 4.1% copper and 6.0% zinc plus lead, gold and silver and inferred
mineral resources of 12 million tonnes grading 3.5% copper and 4.9% zinc plus
lead, gold and silver1. Mineral resources that are not mineral
reserves do not yet have demonstrated economic viability. Initial exploration
drilling on the Bornite deposit in 2011 was highly successful. DDH RC11-187
drilled a continuous interval of 178 meters grading 3.9% copper including a very
significant high-grade intersection of 34.7 meters grading 11.4% copper. Initial
results continue to demonstrate the exceptionally high-grade nature of this
important and evolving mineral district. The Company is focused on continuing to
identify high-grade mineralization with additional exploration drilling this
coming year with four drill rigs and a plan to complete 15,000 meters of
drilling.
About NovaGold
NovaGold is a precious metals company engaged in the
exploration and development of mineral properties primarily in Alaska, U.S.A.
and British Columbia, Canada. The Company is focused on advancing its flagship
property, Donlin Gold and offers superior leverage to gold with one of the
largest reserve/resource bases of any junior or mid-tier gold exploration
company. The Company is also committed to maximizing the value of its non-core
assets, including its interest in the Galore Creek copper-gold-silver
project. NovaGold has a strong track record of expanding deposits through
exploration success and forging collaborative partnerships, both with local
communities and with major mining companies. The Donlin Gold Project in Alaska,
one of the world’s largest known undeveloped gold deposits, is held by a limited
liability company owned equally by wholly-owned subsidiaries of NovaGold and
Barrick Gold Corporation. The Galore Creek Project in British Columbia, a large
copper-gold-silver deposit, is held by a partnership owned equally by
wholly-owned subsidiaries of NovaGold and Teck Resources Limited. NovaGold,
through its wholly-owned subsidiary, NovaCopper Inc., which it plans to spin-out
to shareholders, owns a 100% interest in the high-grade Ambler
copper-zinc-gold-silver deposit in northern Alaska. The Company also owns other
earlier-stage exploration properties. NovaGold trades on the TSX and NYSE-AMEX
under the symbol NG.
1 NovaGold filed a Preliminary Economic Assessment for Ambler
Project on May 10, 2011 (“PEA”). It is available for download on NovaGold’s
website at www.novagold.net, on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov. The PEA is preliminary in nature and included inferred mineral
resources that are considered too speculative geologically to have the economic
characteristics applied to them that would enable them to be catagorized as
mineral reserves. There is no certainty that the PEA will be realized.
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NovaGold Contact
Neil MacRae
Director, Investor Relations
Ariadna D. Peretz
Analyst, Investor Relations
604-669-6227 or 1-866-669-6227
Cautionary Note Regarding Forward-Looking Statements
This press release includes certain “forward-looking
information” and “forward-looking statements” (collectively “forward-looking
statements”) within the meaning of applicable Canadian and United States
securities legislation including the United States Private Securities Litigation
Reform Act of 1995. All statements, other than statements of historical fact,
included herein including, without limitation, statements relating to the
potential spin-out of NovaCopper, and the future operating or financial
performance of NovaGold or NovaCopper, are forward-looking statements.
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”, or “should” occur or be achieved.
These forward-looking statements may include statements regarding perceived
merit of properties; exploration results and budgets; mineral reserves and
resource estimates; work programs; capital expenditures; timelines; strategic
plans; completion of transactions; market prices for precious and base metals;
or other statements that are not statements of fact. Forward-looking statements
involve various risks and uncertainties. There can be no assurance that such
statements will prove to be accurate, and actual results and future events could
differ materially from those anticipated in such statements. Important factors
that could cause actual results to differ materially from NovaGold’s
expectations include the uncertainties involving the need for additional
financing to explore and develop properties and availability of financing in the
debt and capital markets; uncertainties involved in the interpretation of
drilling results and geological tests and the estimation of reserves and
resources; the need for continued cooperation with Barrick Gold and Teck
Corporation for the continued exploration and development of the Donlin Gold and
Galore Creek properties; the need for cooperation of government agencies and
native groups in the development and operation of properties; the need to obtain
permits and governmental approvals; risks of construction and mining projects
such as accidents, equipment breakdowns, bad weather, non-compliance with
environmental and permit 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 exchange rates; failure to satisfy one
or more of the conditions to the Plan including failure to obtain required
court, shareholder or regulatory approval for the Plan; and other risk and
uncertainties disclosed in NovaGold’s Annual Information Form for the year-ended
November 30, 2010, filed with the Canadian securities regulatory authorities,
and NovaGold’s annual report on Form 40-F filed with the United States
Securities and Exchange Commission and in other NovaGold reports and documents
filed with applicable securities regulatory authorities from time to time.
NovaGold’s forward-looking statements reflect the beliefs, opinions and
projections on the 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.
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