Hi all, Much like most of you, I’m patiently awaiting the...

Hi all,

Much like most of you, I’m patiently awaiting the results of the extension drilling at RPM, together with the first stage of drilling at Cathedral. I’m also interesting in other things that Nova has on the agenda, and have sat down and put some of my thoughts together.

RPM North

RPM is currently considered to be the jewel in the Nova crown, with an inferred resource of 1.5Moz @ 2g/t having been defined at RPM North. Infill drilling is currently underway at this location in order to elevate some of the current resource to the indicated category. Assuming that the current drilling and testing program does indeed achieve what it has set out to achieve, then higher grade material from RPM can be included in the Phase 2 Scoping Study. This is forecast to be completed by the end of 2022.

Nova claims that the economics of the project would be majorly improved when considering a scenario of introducing feed from RPM at about 2g/t with the lower grade feed from Korbel Main. The blend ratios would need to be optimised for the study, however, Nova’s sensitivity analysis for the Phase 1 Scoping Study (refer to Figure 2 of the announcement of 28 Feb 2022 and presented below) indicates that feed grade (and price of gold) has the greatest influence on the NPV of the project.

The scoping study was based on a feed grade of 0.41g/t from Korbel alone. When considering say an 80:20 Korbel:RPM blend, the feed grade would then have an average of 0.73g/t (let’s say 0.7g/t). Sure, there would be differences year-to-year depending on which sections of the respective pits at the two deposits are being mined, but there would also be the means to adjust the blend and control the grade of the feed.

So what percentage increase does a feed grade of 0.7g/t represent? It represents a 70% increase above 0.41g/t (the grade used in the Phase 1 scoping study).

I should point out that my understanding of the scoping study is that, while ore sorting has been included in both the CAPEX and OPEX tables (refer to Tables 2a, 2b and 2c presented in the scoping study), the project economics have been based on grade of ore that is feed into the sorters and not the grade of output material following ore sorting. That is, the material from the back of the truck at the start of this flow sheet relates to the grade of feed material.

The sensitivity chart above indicates that a 10% improvement in feed grade would increase the NPV by about USD$230M. Assuming that all other parameters in the chart remain the same, a 70% improvement in grade would/could mean a massive increase in the NPV. You can do you own calcs for some numbers.

Adding feed from RPM would mean additional CAPEX (either a haul road or a slurry pipeline has been mooted as the transport methods) and OPEX that is not currently included in the Phase 1 scoping study, however, the indications are that these would be quite low in the overall scheme. I recall mention of CAPEX of about $50M having been suggested by Nova for this infrastructure.

Cathedral

There has been suggestions made by Nova that the Cathedral prospect could be the core of the Korbel Valley gold system, and, if this is the case, then it implies that it would also contain higher grade gold.

Many of you may remember the model of an IRGS that Nova included in a few announcements back in 2019. The figure below is taken from an ASX release dated 25 May 2020, and I’ve highlighted a particular region. It is this region that I consider that Cathedral is alluded to be associated with.

I’m managing my own expectations on this by acknowledging that:

· Cathedral may not be the central core (carapace or cupola region);

· the central core of an intrusive system doesn’t necessarily mean higher grade gold, as there may be different mineralisation occurring in this region. The hydrothermal alteration in this portion of an IRGS could instead leave other elements/minerals which may not be of benefit to the economics of the current Korbel Main resource; and

· There has not been any drilling here just yet – it could be a complete fizzer.

Notwithstanding this, I am hopeful of Nova finding economically viable grades of gold at Cathedral, as the IP chargeability survey that covers this prospect is certainly appealing, and the earlier rock chip samples also support the presence of gold here. The proximity of Cathedral to the proposed location of the ‘Korbel Central Processing Facility’ (KCPF) is also highly appealing, being only about 2 km from the Korbel Main starter pit.

Cathedral is a dominated by a peak that stands somewhat alone from the surrounding ridgelines. From images I’ve looked at, it appears to protrude from the north facing slopes that form the southern boundary of the Korbel Valley. This gives credence to the idea that Cathedral has a different geomorphological setting from the surrounding peaks. The image below is from Page 14 of the Market Update issued by Nova on 12 April 2022 and it shows Cathedral standing in relative isolation. There are other images in different presentations/announcements that also depict this.

If Cathedral does prove to be a further gold deposit, then this would represent a really nice addition to the Korbel resource. It wouldn’t even need to have ‘bonanza’ grades to be appealing. Because this target it largely a protruding feature, there would be less constraints associated with pit design in initial stages of mining (unless we start going below the level of the surrounding ground), and costs for haulage downhill to the KCPF would likely be less than those associated with bringing material up out of the Korbel Main starter pit. Of course, if grades are appreciably higher than that of the starter pit…well the sensitivity analysis we have already looked at should tell you how good an outcome that would be.

Muddy Creek

Many of you may have noticed that in a recent investor interview, Chris emphasised another target (Muddy Creek). He enthusiastically (how else would he do it J) but briefly mentions it at 11min 10sec in the following presentation: https://youtu.be/JWUEd4TmZ30

In the interview, Chris says that they have information regarding historic sampling lines that go through this area, and “one of the best lines comes right…acrossMuddy Creek,…and we’re really excited…to potentially have another really hotgold prospect…in the bag before the end of the year”.

Until now, Muddy Creek has gone virtually unmentioned. Even so, it has been noted in announcements for quite some time. For example, in the slide pack for the AGM in Dec 2020, there was the following figure:

Muddy Creek is located about 2-3 km to the east of the Nova claim boundary and is clearly labelled. I always thought that it was unusual to include it on the plan, and thought that it either suggested relevance to other targets already within Nova ground (i.e. geologically analogous), or it was a prospective target for Nova in its own right, or both. Despite that, it was never included in the development pipeline we became so familiar with (figure below).

I had also noticed mention of Muddy Creek in more recent ASX announcements made by Nova, such as:

· [29 April 2022] “Continue to unlock the Estelle Gold Trend with ground truthing with RPM surrounds and Muddy Creek thecompany’s prime focus”; and

· [16 May 2022] “Field exploration work to commence in coming months to advance the pipeline of additional high priority prospects across the Estelle Gold Trend, with a focus on the RPM surroundsand Muddy Creek”.

(The bold text is my emphasis).

What I find to be particularly unusual is that, whilst Nova’s claim block had increased in size from 324km² to 450km² some time during the quarter ending 31 Dec 2021, the increase in claim area was effectively all along the western side. This westward extension seems to be to allow material from RPM (and other possible future deposits) to be transported northward along the Styx River and Ptarmigan Valley floor enroute to the KCPF. Even in the recently released announcements, Nova’s claim area still does not extend to the east to capture the Muddy Creek target. As such, I was puzzled as to why Muddy Creek has been identified as a priority target.

WhenI read the April announcement and the noticed the phrase “prime focus”, Idecided to do some research on this prospect.

Thoseof you who have read through or watched some of the company’s presentationswill be familiar with the topography of the Estelle project area, with Korbelnear the northern end, and RPM near the southern limit. The Google Earth image below captures the project area and I’ve plotted locations of some key features. Geographically, Muddy Creek is a tributary to the Skwentna River and flows in a north-easterly direction – I’ve marked its alignment in red. I’ve also plotted a few other prospects (blue stars) which have been identified by another gold exploration company (Kiska).

Thereis a cluster of blue stars to the west of Nova’s Korbel Main deposit, and thefigure below shows a closer view of that region. It shows the locations of Raintree, Rainmaker and the Whistler gold deposits. Whisky Bravo airstrip is visible on the western bank of the Skwentna River, and this is where the Nova work camp is also located.

KiskaMetals Corporation (Kiska) carried out a fair bit of gold exploration work hereabout 10 years ago, and they named this the ‘Whistler Project’.

Thenext image is a close-up of the Whisky Bravo airstrip. The camp currently being used by Nova was previously used by Millrock and is circled in red, whereas the area where Kiska had established their camp is marked in green.

Inaddition to their main focus at the Whistler, Raintree and Rainmaker prospects (whichare all in close proximity of the airstrip), Kiska also carried out explorationworks further south at prospects known and Muddy Creek and Island Mountain.

TheUS Geological Survey (USGS) is a good source of information and it indicatesthat there are at least two components of the Muddy Creek prospect - MuddyCreek Central and Muddy Creek West. Here is some of the info sourced from the USGS database:

Muddy Creek Central

The date of theoriginal discovery of the Muddy Creek Central prospect is uncertain; itprobably was discovered when Cominco Alaska worked in the area from 1986 to1989 (Wahl and others, 2008). KennecottExploration Company was active in the area from 2004 to 2006 and staked a largeblock of claims that covered the Muddy Creek Central prospect. Geoinformatics Exploration Inc. acquired theproperty from Kennecott in 2007, and in 2009, Kiska Metals Corporation wasformed by a merger of Geoinformatics and Rimfire Minerals Corporation. As of early 2010, Kiska Metals (2010a) wasactively exploring their claim blocks, which they named the Whistler project.

The Muddy CreekCentral prospect covers a north-northwest trending area about 1 km by 2 kmin size (Kiska Metals Corporation, 2010b). Numerous rock samples were collected in thearea. A high percentage of themcontained more than 1 gram of gold per tonne, eight contained more than 5 gramsof gold per tonne, and the two best samples contained 81.1 and 111.5 grams ofgold per tonne.

Muddy Creek West

The Muddy CreekWest prospect covers a north-northwest trending area about 1 km by 4 km insize (Kiska Metals Corporation, 2010b). Numerous rock samples were collected at theprospect. A high percentage of themcontained more than 1 gram of gold per tonne, 10 contained more than 5 grams ofgold per tonne, and the best sample contained 56.60 grams of gold per tonne.

USGSdatabase indicates that drilling was carried out by Kiska at the MC Centralprospect, but only surface sampling was undertaken at the MC West prospect.

InMarch 2011, there was an article in North of 60 Mining News regarding Kiska’s explorationprogram at Whistler.

(https://www.miningnewsnorth.com/story/2011/04/24/news/kiska-ratchets-up-whistler-exploration/2403.html)

Thearticle talked about their main Whistler deposit, along with exploration drillingat the nearby Raintree prospect and the more distant Island Mountain prospect. It also commented on the Muddy Creek prospect which had not been drilled up to that time. Here is an excerpt from the article:

“Muddy Creek isdistinct from the other targets at Whistler. While the porphyry discoveries at IslandMountain and the Whistler Orbit are related to a 75 million year old intrusivesuite, Muddy Creek seems to be more akin to the 65 million year oldmineralization at MillrockResources Inc.'s neighboring Estelle project.

Muddy Creek's potential is underscored by the 4.72g/t gold average grade of 150 rock samples collected over a 4-square-mile, or10.5-square-kilometer, area. Thisgeochemical work in conjunction with a geophysical survey has outlined sevenprospects that await drilling.”

Sothere seems to be seven targets within the Muddy Creek prospect, andthis covers a fairly sizable area.

Followingthe field investigations at Muddy Creek, Kiska issued news in mid-December 2011:

VANCOUVER, Dec. 15,2011 /PRNewswire/ - Kiska Metals Corporation ("Kiska" or "theCompany") reports drill results from three reconnaissance drill holes atthe Muddy Creek Prospect, Whistler Project, located 160 kilometres northwest ofAnchorage, Alaska. These first threedrill holes, tested the southwestern edge of a 2.4 square kilometre area ofanomalous gold in soils and returned significant gold-bearing intersections.

Mineralization at MuddyCreek occurs as consistentlydeveloped sheeted veins within a five kilometre-wide diorite-monzoniteintrusive complex in the south central part of the Whistler property. The prospect region is partially covered bycontour soil sampling that highlights a 2.4 square kilometer area where soilsamples average 2.3g/t gold and 0.06% copper. Rock samples collected within a 5.4 squarekilometre area average 4.4g/t gold including select samples of individual veinzones and locally derived talus float samples.

Largely due to steepterrain, holes MC11-001 and 002 were situated at the southwestern edge of thegold-in-soil geochemical anomaly, collared 360 metres apart and drilled towardeach other. Both holes intersected steep northwest strikingsheeted vein arrays. Thenortheast directed hole, MC11-001, returned 38.8 metres averaging 0.51 g/t goldequivalent within a broader interval of 138.8 metres averaging 0.29g/t goldequivalent. The southwest directed hole,MC11-002, returned intervals of 45.0 metres averaging 0.52g/t gold equivalentand 44.2 metres averaging 0.51 g/t gold equivalent within a broad 338.1 metreinterval averaging 0.30g/t gold equivalent. Hole MC11-003 was designed to test the Bonanza Zone, 3.3 kilometres tothe southeast where 12 selective rock samples of outcrop and a few locallyderived float samples averaged 9.0g/t gold over a 340 metre distance along theslope. The hole targeted thevein-hosting diorite beneath capping sediments, however, the hole failed toreach the intended diorite target and was shut down in sediments.

"From our firstattempt at testing the Muddy Creek target, it is obvious that it is a large gold-bearing system. Our holes, which in effect only testedone edge of the anomaly, are certainly encouraging," stated Mark Baknes,VP Exploration of Kiska. "It'searly days in terms of our understanding of Muddy Creek, but it is a distincttarget from Whistler and Island Mountain and shares a resemblance to examples of Intrusion RelatedGold (IRG) systems like Fort Knox in the Fairbanks District and totargets being pursued by a joint Millrock-Teck exploration effort immediatelyadjacent to the west of Muddy Creek. Thepresence of another large gold-bearing system on the property underscores thatthe Whistler Property is an emerging gold district with a diversity ofmineralization styles.

Asummary of the drill hole results for MC11-001 and MC11-002 was also provided:

InJuly 2015, Brazil Resources announced that they had entered into a definitiveagreement with Kiska Metals to acquire its Whistler gold-copper project.

https://investingnews.com/daily/resource-investing/precious-metals-investing/gold-investing/brazil-resources-whistler-gold-copper-project-alaska/

InDecember 2016, Brazil Resources changed its name to ‘GoldMining Inc’, and acheck of their website indicates that they are still holding and advancing the Whistlerproject.

TheNI 43-101 Mineral Resource Estimate for Whistler was completed byGoldMining Inc on 29 October 2021 and can be accessed via their website.

https://www.goldmining.com/projects/united_states/whistler/

Whilstit mainly focuses on the main Whistler and Island Mountain deposits, there aresome bits of information relating to Muddy Creek in the report.

Kiskahad also produced their own NI 43-101 resource estimate report for Whistlerin 2011, and it included a bit more of the work that they had carried out atMuddy Creek. In the table above, I’ve circled a number of samples of rocks, soils and silts, that were part of Kiska’s 2009-2011 exploration works. Some of these were from the Muddy Creek area. The following plan shows the locations of the samples overlain onto a geological map and contour plan of the region. It appears that the sampling lines were approximately mid-way in elevation between the ridgelines and the valley floor. The best of these areas seems to be towards the western portion (I’ve circled this in green). You can see the location of the tenement boundary – Nova’s ground is about 200m-1000m from this line of high ‘hits’. Note: the scale bar shown on the map appears to be wrong – it should be 1000m not 100m.

InChris’ interview, he mentions “sampling lines” and that “oneof the best lines comes right…across Muddy Creek...”. I suspect he is referring to the lines of samples shown in the above figure.

TheGoldMining NI 43-101 report of October 2021 includes the following map ofthe Whistler project tenements on which I’ve marked the area of Muddy Creek.

Ata similar time (5 July 2021), Ragusa Minerals (ASX: RAS) issued an announcementregarding new project acquisitions, leading with the ‘Monte Cristo Project’. They reference the proximity of their ground to the Estelle and Whistler project areas, and they included the following map of their tenements. It shows the common boundary of Nova’s and GoldMining’s claim in the vicinity of Muddy Creek.

Soat this point we can see that, at least into late 2021, Muddy Creek was stillheld by GoldMining Inc.

Goingonto Alaska’s Department of Natural Resources (DNR) you can access a mapping platform. In the Muddy Creek area, and having the State Mining Claims turned on, we can see the various blue mining claim blocks. They are individually numbered and the numbers run in sequence for claims covered by the same application. I’ve plotted a yellow line marking the boundary of GoldMining’s claims (65xxxx number series) and this borders Nova’s claims (72xxxx and 73xxxx series). I don’t know how up-to-date the data is on this portal, but I would expect it to be reasonably current. What I make of this is that the Muddy Creek area is still held by GoldMining. For reference, I’ve marked the region where the rock and soil sampling by Kiska returned the high numbers.

Forthe company to openly expressive eagerness about this prospect, I have onlybeen able to arrive at two possibilities:

· Nova now holds claim over this area but the company hasn’t directly announced it; or

· Nova thinks that the same ‘gold zone’ continues into Nova’s tenements and is running with the same name rather than giving it different name.

Imust admit, while having another identified resource would be good, there aresome aspects of this prospect that don’t excite me. These are:

· We have limited resources (e.g. the construction of drill pads, drill rigs currently working other targets, and limited season for drilling at those altitudes). I’d prefer those resources to focus on the extension drilling further to the west of RPM North, or perhaps send the rig to Train-Shoeshine target as we are approaching the most favourable drilling time and they are at high elevation;

· The gold grade in the two Kiska holes averaged at about 0.22g/t which is not overly high. Sure, further drilling might improve on that, but we have much better grades that warrant attention at RPM;

· Even if we do have success and confirm gold in our initial holes at Muddy Creek, it is likely to be low grade, high tonnage IRGS deposit which means haulage becomes more of a consideration/issue. Our current claim area doesn’t lend itself to run material to the east of the Estelle project area along the flatter Skwentna River valley floor. The main alternative I see would be to link in with one of the transporting options that is currently being evaluated, with a haul route or slurry pipeline running along the western edge of the Nova claim block. The Train-Shoeshine targets is relatively close to Muddy Creek, so MC material could be feed into whatever is found to be present at Train and/or Shoeshine – again this still means that testing of those targets is perhaps warranted prior to Muddy Creek.

I’mfully aware that some people just don’t like the ‘style’ or level of enthusiasmdisplayed during interviews by Chris. I’m happy with enthusiasm, although some of the catch phrases could be dropped. More importantly, what I do like is that the company is not sitting around taking things cushy. We have had a pretty fast rise in the definition of the resources, and this is being carried out in an area where it is logistically and physically difficult to get to. Just the construction of the drill pads shows us that the terrain is impossible without helicopters and manpower – we aren’t talking about just heading down the road in a Landcruiser with some pegs to mark out the position of drill holes for rigs that are already enroute. And the work is being done at very low discovery costs!

Howabout the good news of having visible gold at RPM. Here’s finding more of that in the extension holes that continue out westward. J

Kindregards.