Mineral properties and development costs (Tables)

6 Months Ended

May 31, 2019

Mineral Industries Disclosures [Abstract]

Schedule of Mineral Properties and Development Costs [Table Text Block]

in thousands of dollars

	November 30, 2018 $		Acquisition costs $		May 31, 2019 $
Alaska, USA
Ambler (a)		26,587		-		26,587
Bornite (b)		4,000		-		4,000
		30,587		-		30,587

in thousands of dollars

	November 30, 2017 $		Acquisition costs $		November 30, 2018 $
Alaska, USA
Ambler (a)		26,587		-		26,587
Bornite (b)		4,000		-		4,000
		30,587		-		30,587

(a) Ambler

On January 11, 2010, NovaGold Resources Inc. (“NovaGold”), through Alaska Gold Company (“AGC”), at the time a wholly-owned NovaGold subsidiary, purchased 100% of the Ambler lands in Northwest Alaska, which contains the copper-zinc-lead-gold-silver Arctic Project and other mineralized targets within the volcanogenic massive sulfide belt, through a series of cash and share payments. Total fair value of the consideration was $26.6 million. The vendor retained a 1% net smelter return royalty that the Company can purchase at any time for a one-time payment of $10.0 million.

The Ambler lands were acquired on October 17, 2011 by Trilogy Metals US through a purchase and sale agreement with AGC. On October 24, 2011, NovaGold transferred its ownership of Trilogy Metals US to the Company, then itself a wholly owned subsidiary of NovaGold, which was subsequently spun-out to NovaGold shareholders and publicly listed on April 30, 2012 (“NovaGold Arrangement”).

(b) Bornite

On October 19, 2011, Trilogy Metals US acquired the exclusive right to explore and the non-exclusive right to access and enter on the Bornite lands, and lands deeded to NANA Regional Corporation, Inc. (“NANA”) through the Alaska Native Claims Settlement Act, located adjacent to the Ambler lands in Northwest Alaska. As consideration, Trilogy Metals US paid $4 million to acquire the right to explore and develop the combined Upper Kobuk Mineral Projects through an Exploration Agreement and Option to Lease with NANA. Upon a decision to proceed with construction of a mine on the lands, NANA maintains the right to purchase between a 16%-25% ownership interest in the mine or retain a 15% net proceeds royalty which is payable after Trilogy Metals US has recovered certain historical costs, including capital and cost of capital. Should NANA elect to purchase an ownership interest, consideration will be payable equal to all historical costs incurred on the properties at the elected percentage purchased less $40 million, not to be less than zero. The parties would form a joint venture and be responsible for all future costs, including capital costs of the mine based on their pro-rata share.

NANA would also be granted a net smelter return royalty of between 1% and 2.5% upon the execution of a mining lease or a surface use agreement, the amount of which is determined by the classification of land from which production originates.

Schedule of Mineral Property Expenses [Table Text Block]

The following table summarizes mineral properties expense for the noted periods.

In thousands of dollars

	Three months ended May 31, 2019 $		Three months ended May 31, 2018  $			Six months ended May 31, 2019  $			Six months ended May 31, 2018  $
Alaska, USA
Community		146		154			264			244
Drilling		173		180			173			180
Engineering		303		186			624			505
Environmental		136		81			271			169
Geochemistry and geophysics		593		591			758			646
Land and permitting		174		166			360			359
Project support		778		601			1,004			677
Other income		-		(2	)		(1	)		(20	)
Wages and benefits		603		518			988			846
Mineral property expense		2,906		2,475			4,441			3,606