NOTE 5. INVESTMENT IN GALORE CREEK

6 Months Ended

May 31, 2016

Investments in and Advances to Affiliates, Schedule of Investments [Abstract]

NOTE 5. INVESTMENT IN GALORE CREEK

The Galore Creek project is owned by Galore Creek Partnership (GCP), a partnership in which Teck Resources Limited (“Teck”) and a wholly owned subsidiary of NOVAGOLD each own a 50% interest. GCP has a board of four directors, with two members selected by Teck and two members selected by the Company. All significant decisions related to GCP require the approval of both Teck and the Company.

GCP prepares its financial statements under International Financial Reporting Standards, as issued by the IASB, and presents its financial statements in Canadian dollars. In accounting for its investment in GCP, the Company converts and presents reported amounts in accordance with US GAAP and in U.S. dollars.

Changes in the Company’s investment in GCP are summarized as follows:

	Three months ended May 31,						Six months ended May 31,
	2016			2015			2016			2015
Balance – beginning of period	$	239,732		$	259,245		$	242,906		$	283,247
Share of losses:
Mineral property expenditures		(74	)		(12	)		(133	)		(25	)
Care and maintenance expense		(246	)		(273	)		(381	)		(386	)
		(320	)		(285	)		(514	)		(411	)
Funding		244			268			459			444
Foreign currency translation		7,696			1,378			4,501			(22,674	)
Balance – end of period	$	247,352		$	260,606		$	247,352		$	260,606

The following amounts represent the Company’s 50% share of the assets and liabilities of GCP presented in U.S. dollars and in accordance with US GAAP. As a result of recording the Company’s investment at fair value in June 2011, the carrying value of the Company’s 50% interest is higher than 50% of the book value of GCP. Therefore, the Company’s investment does not equal 50% of the net assets recorded by GCP:

	At May 31, 2016			At November 30, 2015
Current assets: Cash, prepaid expenses and other receivables	$	323		$	497
Non-current assets: Mineral property		222,583			218,532
Current liabilities: Accounts payable and accrued liabilities		(190	)		(365	)
Non-current liabilities: Payables and decommissioning liabilities		(7,295	)		(7,162	)
Net assets	$	215,421		$	211,502