Ms. Melanie Hennessey reports

NOVAGOLD MARKS 2014 BY REACHING IMPORTANT MILESTONES IN ADVANCING PERMITTING OF DONLIN GOLD AND STRENGTHENING STAKEHOLDER RELATIONSHIPS

NovaGold Resources Inc. has released its year-end financial results and a project update for its flagship 50-per-cent-owned Donlin gold project in Alaska and its 50-per-cent-owned Galore Creek project in British Columbia.

Details of the company's financial results for the year ended Nov. 30, 2014, are presented in the consolidated financial statements and in the annual report filed on Form 10K with the Securities and Exchange Commission that will be available on the company's website, on SEDAR and on EDGAR. (All amounts are in U.S. dollars unless otherwise stated, and all resource and reserve estimates are shown on a 100-per-cent project basis.)

In 2014, NovaGold achieved the following:

• Significantly advanced permitting of Donlin gold:
• • Development of alternatives for the environmental impact study was completed by the Corps, the project's lead permitting agency.
  • The Corps also finalized initial chapters of the Donlin gold draft EIS.
  • Donlin gold made submissions of information requested by the Corps for the draft EIS.
• Extended Donlin gold surface use agreement with the Kuskokwim Corp., which now coincides with Calista Corp.'s exploration and mining lease and covers the entire projected mine life;
• Formed important alliance with the National Fish and Wildlife Foundation's Alaska Fish and Wildlife Fund to protect, conserve and restore Alaska's fish and wildlife;
• Built upon extensive local outreach efforts in Alaska:
• • Held informational meetings in numerous villages in the Yukon-Kuskokwim region, where the Donlin gold project is located;
  • Financed youth educational programs, resources and camps;
  • Sponsored, participated and volunteered in numerous statewide and local events;
• Maintained a strong financial position with total spending 14 per cent lower than budget in 2014.

President's message

"We made excellent progress in 2014, setting the stage to continue to advance Donlin gold up the value chain. Significant headway was achieved in five key areas: firstly, the Corps, with the collaboration of the co-operating agencies and Donlin gold, advanced permitting activities on budget and on schedule: completing the alternatives development for the EIS, submitting all related-party comments and finalizing the initial chapters of the draft EIS; secondly, we extended the Donlin gold surface use agreement with TKC for the entire project mine life; thirdly, we announced a new partnership with the NFWF alliance on the Alaska Fish and Wildlife Fund to protect, restore and conserve Alaska's fish and wildlife, a truly unique partnership; fourthly, we carried out extensive outreach efforts and sponsorship initiatives in Alaska; and lastly, we continued to reduce expenditures, spending 14 per cent less than we budgeted for 2014. Our commitment to conserve cash affords us the flexibility to finance Donlin gold studies and activities through permitting and up to a record of decision, to support Galore Creek technical studies, as well as meet our other financial obligations. These are particularly meaningful achievements, considering the challenging market environment we live in. This progress positions Donlin gold as one of the few major gold projects that could be shovel-ready as we complete the permitting process and market conditions improve.

"In my career, I have been fortunate to have worked on mines that ultimately operated for decades by discovering additional ounces as they carried out production. Donlin gold is the first project I have ever worked on that has a gold resource to support several decades of mine life. Its endowment, which is only one of its many attributes, really sets it apart from any other asset in the gold industry. With the resource base of approximately 39 million ounces, a grade averaging about 2.2 grams of gold per tonne (unusually high for an open pit in today's environment) and annual gold production of greater than one million ounces anticipated for more than 27 years, Donlin gold is in a category of its own. This future mine should handsomely profit from multiple gold cycles during its expected life. Importantly, beyond the current resource, its exploration potential should be conducive to expanding the current open-pit resource both along strike and at depth along an eight-kilometre mineralized belt. In my view, it is likely that Donlin gold's mine life will be substantially greater than currently envisioned. Additionally, with its all-in costs expected to average in the region of $735 per ounce for the life of the mine, Donlin gold should be a substantial cash flow generator for a long time, and, because of the above operating and mine-life characteristics, its value should increase substantially with higher gold prices. Specifically, a two-time increase in the gold price could yield a 20-fold increase in the net present value of Donlin gold.

"Donlin gold is also proud of its time-tested and mutually beneficial partnerships, which have been developed over nearly two decades. Our team is highly experienced in working with joint venture partners and stakeholders to responsibly manage the permitting process. The truth is that we have a head start in Alaska, which has a vibrant and growing mining industry. Donlin gold enjoys broad support from both the government of Alaska and our Alaska Native Corp. stakeholders, Calista and TKC, which own the mineral and surface rights to Donlin gold. Our well-established record of social engagement and environmental stewardship in the community is a huge plus. The government of Alaska cites Donlin gold as a model project for responsible development, a reputation that was reinforced in 2014 by a unique alliance with NFWF. We are very proud and honoured to collaborate with NFWF.

"In 2014, Donlin gold passed the halfway mark in permitting. Its experienced management team worked very hard to ensure that the Corps had all the necessary tools to advance the permitting process, which was mainly focused on the preparation of the draft EIS. The Corps completed the alternatives identification and established a reasonable range of alternatives to be evaluated in the EIS. The Corps also distributed the initial drafts of the major EIS sections to the co-operating agencies and Donlin gold, which in turn provided their feedback to the Corps prior to year-end. The Corps is now considering all the comments and is expected to incorporate the relevant changes into the draft EIS, which is on schedule to be published for public comment in 2015, with the final EIS anticipated to be issued in 2016. Donlin gold continues to work simultaneously with other agencies on major permit applications, such as air quality, water discharge and usage, gas pipeline, wetlands, rights-of-way, and dam safety.

"NovaGold's relationship with its 50-per-cent partner, Barrick Gold, has never been better. Together, we are working on opportunities to reduce initial capital outlay by exploring possibilities for third party financing of some capital-intensive infrastructure. Collectively, we are also investing about $3-million (100-per-cent basis) on technical studies to identify potential design and execution enhancements from the 2011 feasibility study.

"On another front, Donlin gold remains actively engaged in sponsorship activities at the community level: supporting local youth in leadership endeavours, visiting communities in the Yukon-Kuskokwim region and executing on its work force development strategy. Throughout 2014, we continued to promote safety, education and work force development by supporting local and regional events, scholarships, and programs. We led and participated in multiple community meetings throughout the region. Additionally, we participated in the annual spring Clean Up Green Up event, where a record 52 villages participated this year in communitywide efforts to reduce litter and promote reuse and recycling.

"At Galore Creek, over the last year, NovaGold and its 50-per-cent partner, Teck Corp., conducted workshops and engineering analyses, aimed at evaluating and optimizing scenarios for integrated mining, waste disposal and water management plans. All this work is aimed at enhancing the value of this important project, which, when built, is expected to be the largest copper mine in Canada.

"At Galore Creek, we are also active in the community, sponsoring local fundraising events and supporting Tahltan literacy camps, as well as providing assistance and financing for research on the Tahltan language dictionary. In 2015, NovaGold and Teck will continue to evaluate opportunities to further enhance the value of Galore Creek. In the meantime, we will continue to evaluate opportunities to monetize its value to strengthen our balance sheet and focus primarily on the permitting of Donlin gold.

"Our healthy financial position, with more than $165-million in cash and term deposits, gives us flexibility to continue financing planned project activities, repay the remaining convertible notes and fulfill other financial obligations for years to come. Taking a no-dime-before-its-time philosophy, we strive to be careful stewards of the capital that was entrusted to us by our shareholders. As such, our team has streamlined the company's structure and operations. With the exception of the outstanding convertible notes repayment, the 2015 budget is expected to be even smaller than last year. Further details on the budget are provided in the 2015 outlook section herein.

"In conclusion, we are fortunate to have two world-class assets in our portfolio. More than this, on a personal level, I feel privileged to have the opportunity to lead a team managing these assets that is among the most accomplished and experienced to be found anywhere in the gold industry. We are committed, and will continue to strive, to deliver on the objectives that were set when we joined the company, which is to develop what will be one of the most coveted precious metal mines in the world. We are truly humbled by the continued support and interest of all of our stakeholders and shareholders. As always, I express my most sincere gratitude to our employees, project teams, governments, native corporations and first nations of the jurisdictions in which we operate for all their hard work and dedication. We are also grateful for the guidance and value-focused vision provided by our board of directors."

Financial results

For the year ended Nov. 30, 2014, NovaGold reported a decrease in loss from operations of $17.8-million from $55.8-million in 2013 to $38.0-million in 2014. The decrease resulted from lower general and administrative expense and lower losses from equity investments in the Donlin gold and Galore Creek projects. General and administrative expense decreased $4.9-million due to lower share-based compensation, office rent and professional fees. The company's share of losses at the Donlin gold project decreased by $600,000, as 2014 activities continued to focus primarily on permitting. At the Galore Creek project, the company's share of losses decreased by $11.4-million in 2014 because the company did not have an exploration program and had reduced camp activity, and mobile equipment was fully depreciated in 2013.

Net loss decreased from $62.8-million (20 cents per share -- basic and diluted) in 2013 to $40.5-million (13 cents per share -- basic and diluted) in 2014. The decrease resulted primarily from the $17.8-million reduction in the loss from operations in 2014 compared with 2013. Interest expense decreased by $5.8-million due to the $79.2-million repurchase of convertible notes in 2013. The company recorded a writedown of marketable securities and other investments totalling $3.2-million in 2013 and had a lower tax expense of $300,000 in 2014 compared with $3.9-million in 2013.

                        FINANCIAL HIGHLIGHTS
      (in thousands of U.S. dollars, except for per-share amounts)

                                             Year ended          Year ended  
                                          Nov. 30, 2014       Nov. 30, 2013 
 
(Loss) from operations                         $(38,008)           $(55,776)
Other income (expense)                           (2,213)             (3,088)
Income (loss) for the period                    (40,484)            (62,760)
Income (loss) per share, basic and                                          
diluted                                           (0.13)              (0.20)

Liquidity and capital resources

NovaGold's cash expenditures in 2014 were 14 per cent under budget at $25.9-million (budget: $30-million). The company's share of cash financing for Donlin gold in 2014 was $13.9-million for permitting, as well as community engagement and development. The company's share of cash financing for Galore Creek in 2014 was $2.1-million, which primarily financed technical studies, administrative expenses, environmental monitoring, and site care and maintenance costs. General and administrative expense in 2014 was $22.0-million, including $10.2-million in non-cash share-based compensation.

With $165.3-million in cash and term deposits, the company has sufficient working capital to repay the remaining $15.8-million of outstanding convertible notes due in May, 2015, and advance the Donlin gold project through permitting and toward a record of decision, as well as finance technical studies at Galore Creek.

Outlook for 2015

In 2015, the company expects to spend approximately $44.8-million, which includes $15.8-million to repay the principal on the remaining convertible notes; $12.6-million to finance the company's share of expenditures at the Donlin gold project to assist the Corps in continuing to advance the permitting process through issuance of the draft EIS, as well as maintain engagement with the stakeholder groups in the Yukon-Kuskokwim region; $1.6-million to finance the company's share of expenditures at the Galore Creek project to continue to advance technical studies in project mine planning and design, waste rock and water management, environmental monitoring, and site care and maintenance; and $14.8-million for general and administrative costs, interest, and joint Donlin gold studies with Barrick ($1.5-million 50-per-cent share). No drilling program is planned for either the Donlin gold or Galore Creek projects in 2015.

Looking at the year ahead, NovaGold will focus on five key areas: firstly, to advance the Donlin gold project toward a construction/production decision; secondly, uphold strong relationships with all stakeholders; thirdly, advance Galore Creek mine planning and project design; fourthly, evaluate opportunities to monetize the value of Galore Creek; and lastly, maintain a healthy balance sheet.

Conference call and webcast details

The conference call and webcast, to discuss these results, will take place Jan. 29, 2015, at 8 a.m. PT (11 a.m. ET). The webcast and conference call-in details are provided as follows:

Webcast:  At the NovaGold website

North American callers:  1-877-415-3179

International callers:  1-857-244-7322

Participant passcode:  90323184

The webcast will be archived on NovaGold's website for one year. For a transcript of the call, please e-mail info@novagold.com.

Scientific and technical information

Scientific and technical information contained herein with respect to Donlin gold is derived from the "Donlin Creek gold project, Alaska, USA, NI 43-101 technical report on second updated feasibility study," compiled by Amec with an effective date of Nov. 18, 2011, as amended Jan. 20, 2012. Kirk Hanson, PE, technical director, open-pit mining, North America (Amec, Reno), Gordon Seibel, RM SME, principal geologist (Amec, Reno), Tony Lipiec, PEng, manager process engineering (Amec, Vancouver), are the qualified persons responsible for the preparation of the independent technical report, each of whom is independent qualified persons as defined by NI 43-101.

Certain scientific and technical information contained herein with respect to Galore Creek is derived from the technical report entitled, "Galore Creek project, British Columbia, NI 43-101 technical report on prefeasibility study," dated effective July 27, 2011. The qualified persons responsible for the preparation of the independent technical report are Robert Gill, PEng, principal consultant and study manager (Amec Americas Ltd.), Greg Kulla, PGeo, principal geologist (Amec Americas), Gregory Wortman, PEng, technical director process (Amec Americas), Jay Melnyk, PEng (Amec Americas), and Dana Rogers, PE, principal tunneling engineer (Lemley International), each of whom is independent qualified persons as defined by NI 43-101.

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