VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 13, 2011) - NovaGold Resources Inc. (News - Market indicators)(NYSE Amex:NG) today announced the results of its second quarter ended May 31, 2011. Details of the Company's financial results are contained in the unaudited consolidated financial statements and Management's Discussion and Analysis which, together with further details on each of the Company's projects, including mineral resource estimates, will be available on the Company's website at www.novagold.net, on SEDAR at www.sedar.com and on EDGAR at www.sec.gov. All amounts are in Canadian dollars unless otherwise stated.

NovaGold will host a conference call and webcast

Thursday, July 14 at 8:30am PST (11:30am EST)

Webcast: www.novagold.net

North American callers: 1-866-212-4491

International callers: 416-800-1066

President's Message

During the quarter, our team at NovaGold continued working on the advancement of its three principal projects: Donlin Gold⁽¹⁾ project in Alaska, Galore Creek copper-gold-silver project in British Colombia and Ambler polymetallic project in Alaska. Our strategy of delivering two world-class mines with our 50% partners Barrick Gold Corporation ("Barrick") at Donlin Gold and Teck Resources at Galore Creek remained on track. The addition of the Ambler project to our development pipeline, with the release of successful Preliminary Economic Assessment ("PEA") in April, provides NovaGold with two strong platforms: one in gold and the other in copper. Donlin Gold and Galore Creek have substantial endowments of gold, while Galore Creek and Ambler have significant amounts of copper. All three projects, once in operation, would have multi-decade mine lives.

(1) Donlin Creek LLC has been renamed Donlin Gold LLC and the project, formally referenced as Donlin Creek will now be referred to as Donlin Gold.

The remainder of this year will be an exciting period for NovaGold. The Galore Creek pre-feasibility is expected to be released later this month and the Donlin Gold feasibility study is expected to be completed in the fourth quarter of 2011. These studies mark a major milestone in the advancement of each respective project. In addition, we have expanded our exploration plans for 2011. Drilling has commenced at Ambler with two rigs operating – one gathering geotechnical and hydrologic information in preparation of further engineering studies and the second exploring for new resources. Drilling has also started at Galore Creek with three rigs currently on site and expanding to five during the summer. Drilling will focus on geotechnical evaluation for tunnel alignment and pit slope stability and converting existing inferred mineral resource to measured and indicated category. In addition, we will launch our Phase II drilling program at our San Roque project in Argentina later this year.

Advancing our Projects

Galore Creek

In May we completed the acquisition of the remaining 40% of Copper Canyon Resources ("Copper Canyon") NovaGold didn't already own. Copper Canyon's main asset was its interest in a property and associated copper-gold resource adjacent to the Galore Creek project. Since the Copper Canyon property is within the area of interest of the Galore Creek Partnership Agreement with Teck, the acquired interest has been offered to the Partnership which has a fixed period of time to respond. If consolidated into Galore Creek Mining Corporation ("GCMC"), the ownership of Copper Canyon would further consolidate GCMC's land position in the Galore Creek area, simplify infrastructure development and add additional resource and exploration upside.

In July we expect to release the results of Galore Creek pre-feasibility study. The study will establish capital and operating cost estimates and production profiles for the project and outline permitting and construction requirements. The completion of a positive pre-feasibility study would enable NovaGold to add Galore Creek gold, silver and copper mineral reserves to its portfolio. Based on preliminary results, GCMC decided to complete additional engineering and environmental work in 2011 and to launch a drill program to convert inferred mineral resource to the measured and indicated category. The partners have approved a $30.5-million budget for the remainder of 2011 and are hiring staff and mobilizing the equipment required to complete the 2011 work program.

Donlin Gold

In the second half of 2011, Donlin Gold LLC (formerly Donlin Creek LLC), owned equally by wholly owned subsidiaries of NovaGold and Barrick, is expected to complete a revised feasibility study for the Donlin Gold project in Alaska. The study will provide updated cash flow projections for the project using current consensus long-term gold prices as well as updated capital and operating cost estimates. The study is incorporating the use of a natural gas pipeline, which would bring a lower-cost fuel source for on-site power generation instead of previously-assumed diesel fuel. Optimization studies showed that using natural gas as the primary fuel source should reduce power costs, which account for approximately 25% of overall project operating costs. The usage of natural gas should also reduce the environmental footprint of the project and simplify supply chain logistics. Once the feasibility revision is finalized, Donlin Gold LLC is expected to proceed with the preparation and filing of permit applications for the project, a significant milestone on the path toward a construction decision.

Ambler

During the second 2011 quarter, NovaGold completed a PEA at its advanced exploration-stage Ambler copper-zinc-gold-silver project in northern Alaska. The PEA demonstrated that the project has robust economics to allow for development of the high-grade Arctic deposit. With grades averaging approximately 4% copper and 6% zinc, the Arctic deposit is one of the highest-grade known VMS deposits in the world on a copper-equivalent basis. The project's Net Present Value (NPV8%), using the PEA base case metal price assumptions of US$2.50/lb copper, US$1.05/lb zinc, US$1.00/lb lead, US$1,100/oz gold and US$20/oz silver, was assessed at US$718 million and US$505 million on a pre-tax and post-tax basis, respectively. The corresponding Internal Rates of Return ("IRR") were estimated at 30% and 25%. Post-tax cash flows were estimated at US$1.7 billion, with full payback occurring in year four of operations. Using recent metal prices of US$4.31/lb copper, US$1.20/lb zinc, US$1.20/lb lead, US$1,425/oz gold and US$36/oz silver, the pre-tax and post-tax Net Present Value (8%) was assessed at US$2.2 billion and US$1.6 billion, respectively, with corresponding Internal Rates of Return of 59% and 50%. Under these conditions, full payback would occur within two years of operations, with post-tax cash flows estimated at US$4.6 billion. With initial start-up capital of US$262 million to build a long-life underground mine and sustaining capital of US$134 million, the Arctic deposit shows great promise. Drilling is underway at the property to convert the inferred and indicated mineral resources to a higher category and also expand the resource base, and we have initiated the environmental and engineering studies required to further advance the project. Mineral resources that are not mineral reserves do not have demonstrated economic viability. We are also working with our Alaska Native partner, NANA Regional Corporation, to finalize a comprehensive agreement for collaborative exploration and development of the Ambler district, which includes a number of historical deposits and prospective targets.

NovaGold remains focused on its business plan and systematically achieving the milestones required to advance its significant projects toward construction and production. With three exceptional properties in our portfolio, and with the expertise of our partners, NovaGold is well-positioned to become a substantial producer of gold and copper.

Financial Results

For the three-month period ended May 31, 2011, the Company reported a net loss of $10.6 million (or $0.03 basic and diluted loss per share) compared to a net loss of $16.8 million (or $0.07 basic and diluted loss per share) for the corresponding period in 2010. This variance was mainly due to the gain on disposition of alluvial gold properties of $16.1 million, with no comparable charge during the same period in 2010.

For the six-month period ended May 31, 2011, the Company reported a net loss of $77.9 million (or $0.25 basic and diluted loss per share) compared to a net loss of $36.2 million (or $0.17 basic and diluted loss per share) for the corresponding period in 2010. This variance was mainly due to the non-cash asset impairment of the power transmission rights which resulted in an impairment charge of $52.7 million, of which $13.8 million was attributable to non-controlling interest and $9.7 million to future income tax recovery partially offset by the gain on disposition of alluvial gold properties of $16.1 million.

Expenses for the three-month period ended May 31, 2011 were $27.1 million compared to $17.2 million for the same period in 2010. This increase was primarily due to an increased exploration expense of $4.6 million compared to $0.6 million for the same period in 2010 as the result of an increased level of activity for the Galore Creek pre-feasibility study and exploration work at the Ambler project. The Company also recorded $4.0 million Galore Creek project care and maintenance expense in 2011 compared with $1.5 million in 2010, mainly due to the increased level of activity in 2011 compared to second quarter 2010 as the project progresses by strengthening the existing access areas and upgrading its environmental program.

Expenses for the six-month period ended May 31, 2011 were $49.3 million compared to $36.8 million for the same period in 2010. This was primarily due to the increased level of activity for the gas pipeline studies at Donlin Gold during the first half of 2011 which resulted in the increase of equity loss to $10.2 million compared with $7.0 million in 2010. The Company also recorded expense of $5.1 million compared with $3.1 million for stock-based compensation during the same periods in 2011 and 2010, respectively; the increase is due to higher valuations for the stock option and performance share units ("PSU") issued as a result of the higher stock price. During the first six months of 2011, the Company granted 1,234,700 stock options and 244,000 PSUs to employees, consultants and directors. These increases were offset by the reduction of care and maintenance expenditures at Rock Creek, as the Company recorded $4.8 million in the first six months in 2011 compared with $10.6 million in 2010. This was due to the decreased level of activity in 2011 compared to 2010, when the Company was improving the tailings pond infrastructure and water treatment processes at Rock Creek.

Outlook

At May 31, 2011, the Company had cash and cash equivalents of $111.6 million and working capital of $108.0 million.

The Donlin Gold project has an approved 2011 budget of approximately US$43.5 million, with US$17.0 million spent to date, of which the Company's 50% share is approximately US$20.5 million, with US$8.5 million funded to date. The 2011 work program will focus on completing the feasibility revision to incorporate the natural gas pipeline, and preparing permit applications for the project. During 2011, Donlin Gold will continue to consult with stakeholders and solicit feedback from local communities and its Alaskan Native partners as well as State and Federal regulatory agencies. Donlin Gold has budgeted to spend US$14.6 million in the third quarter, of which the Company's 50% share is approximately US$7.3 million, on community engagement, environmental studies and feasibility revision activities. The feasibility revision should be complete in the second half of 2011, at which point Donlin Gold is expected, subject to approval by NovaGold and Barrick, to proceed to prepare and file permit applications for the project.

At the Galore Creek project, GCMC spent approximately $12.3 million in the six month period ended May 31, 2011 on care and maintenance, community engagement and completing the pre-feasibility study, and the partners have approved a supplementary budget of $30.5 million for additional exploration and engineering work. Teck was the sole funding partner until June 22, 2011, when it completed its $373.3 million earn-in obligation. NovaGold and Teck will fund the supplementary budget equally with NovaGold's share being $15.3 million. NovaGold expects to fund $8.3 million in the third quarter at the Galore Creek project for exploration, geotechnical drilling and additional environmental and engineering work to prepare for feasibility-level activities.

At the Ambler project, NovaGold has budgeted approximately US$10.0 million for 2011 for exploration and geotechnical drilling at site and for additional studies to determine the environmental and engineering aspects of developing the Arctic deposit, with US$3.4 million spent to date. The Company continues to work with NANA Corporation to establish an agreement for collaborative development of the Ambler region, including district consolidation and infrastructure development that would benefit both the project and local communities. Management has been working actively with the State of Alaska in discussions regarding the Ambler Mining District Transportation Access. The Company expects to spend US$4.6 million in the third quarter on exploration activities as well as environmental and engineering studies.

At the Rock Creek project, the Company has budgeted approximately US$8.5 million for 2011 with a focus on continuing to meet permit requirements and environmental responsibilities, with US$4.8 million spent to date. While NovaGold is soliciting offers to sell the project, the Company is also preparing an updated closure plan for the project in the event that the Company's Board of Directors chooses to close and reclaim the property and has budgeted a supplemental US$6.8 million for preparing the updated closure plan. The Company expects to spend US$3.9 million at its Rock Creek project in the third quarter. 

About NovaGold

NovaGold is a precious metals company engaged in the exploration and development of mineral properties in Alaska, U.S.A. and British Columbia, Canada. The Company is focused on advancing its two core properties, Donlin Gold and Galore Creek, with the objective of becoming a low-cost million-ounce-a-year gold producer, and offers superior leverage to gold and copper with one of the largest mineral reserve/resource bases of any junior or mid-tier gold company. 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 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 also owns a 100% interest in the high-grade Ambler copper-zinc-gold-silver deposit in northern Alaska and has other earlier-stage exploration properties. NovaGold trades on the TSX and NYSE-AMEX under the symbol NG. More information is available at www.novagold.net or by emailing info@novagold.net.

Cautionary Note Regarding Forward-Looking Statements

This press release includes certain "forward-looking statements" within the meaning of 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 NovaGold's future operating or financial performance, 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 are set forth principally under the heading "Outlook" and elsewhere in this news release and 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 price of precious 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 Resources in the exploration and development of the Donlin Creek 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; fluctuations in metal prices and currency exchange rates; 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.

Cautionary Note Regarding Reserve and Resource Estimate

This press release has been prepared in accordance with the requirements of the securities laws in effect in Canada, which differ from the requirements of U.S. securities laws. Unless otherwise indicated, all resource and reserve estimates included in this press release have been prepared in accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects ("NI 43-101") and the Canadian Institute of Mining and Metallurgy Classification System. NI 43-101 is a rule developed by the Canadian Securities Administrators which establishes standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. Canadian standards, including NI 43-101, differ significantly from the requirements of the United States Securities and Exchange Commission ("SEC"), and resource and reserve information contained herein may not be comparable to similar information disclosed by U.S. companies. In particular, and without limiting the generality of the foregoing, the term "resource" does not equate to the term "reserves". Under U.S. standards, mineralization may not be classified as a "reserve" unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. The SEC's disclosure standards normally do not permit the inclusion of information concerning "measured mineral resources", "indicated mineral resources" or "inferred mineral resources" or other descriptions of the amount of mineralization in mineral deposits that do not constitute "reserves" by U.S. standards in documents filed with the SEC. U.S. 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. It cannot be assumed that all or any part of an "inferred mineral resource" will ever be upgraded to a higher category. Under Canadian rules, estimated "inferred mineral resources" may not form the basis of feasibility or pre-feasibility studies except in rare cases. Investors are cautioned not to assume that all or any part of an "inferred mineral resource" exists or is economically or legally mineable. 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" by SEC standards as in-place tonnage and grade without reference to unit measures. The requirements of NI 43-101 for identification of "reserves" are also not the same as those of the SEC, and reserves reported by the Company in compliance with NI 43-101 may not qualify as "reserves" under SEC standards. Accordingly, information concerning mineral deposits set forth herein may not be comparable with information made public by companies that report in accordance with U.S. standards.

To view the Appendix - Reserve & Resource Table accompanying this release, please click the following link: http://media3.marketwire.com/docs/713NG%20Appendix.pdf.