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Posts tagged ‘Seabridge Gold Inc (SEA)’

Visual Capitalist: The history of British Columbia’s Golden Triangle

July 7th, 2016

posted with permission of Visual Capitalist | July 7, 2016

In a hidden corner of northwestern Canada lies some of the world’s most significant mineral potential. Billions of dollars of undiscovered gold, silver and copper still sit within an unexplored area that was once remote. However, only now can these world-class deposits be finally tapped. Skeena Resources TSXV:SKE has helped Visual Capitalist to put together the story of the famed Golden Triangle.

The history of the Golden Triangle

Even before Canada was officially a country, the area now known as the Golden Triangle was a hub for prospectors looking to strike it rich.

In 1861, Alexander “Buck” Choquette struck gold at the confluence of the Stikine and Anuk rivers, kickstarting the Stikine Gold Rush. More than 800 prospectors left Victoria to go to the Stikine in search of gold.

A few short years later, an even more significant rush would occur just to the north in the Cassiar region—it’s where British Columbia’s biggest ever gold nugget, weighing in at 73 ounces, would be found. The Atlin Gold Rush, an offshoot of the world-famous Klondike Gold Rush, would also occur just north of the Triangle.

The first discoveries

The companies that first worked in the Golden Triangle balanced its richness against the costs of its remote location.

Premier gold mine

The first big discovery in the Golden Triangle was at the Premier gold mine, which started operations in 1918. The company that first owned it, Premier Gold Mining Company, returned as much as 200% on the stock market between 1921 and 1923. At the time the Christian Science Monitor called it “one of the greatest silver and gold mines in the world.”

Snip mine

Discovered in 1964 by Cominco, the deposit stayed dormant until 1986, when it was drilled in a joint venture with Delaware Resources. Murray Pezim’s Prime Resources bought out Delaware after the stock ran from a dollar to $28 a share.

The high-grade Snip mine produced approximately one million ounces of gold from 1991 until 1999 at an average gold grade of 27.5 gams per tonne.

Eskay Creek

In 1988, after 109 drill holes, tiny exploration companies Stikine Resources and Calpine Resources finally hit the hole they needed at Eskay Creek with grades as high as 27.2 g/t and 30.2 g/t gold.

Eskay would go on to become Canada’s highest-grade gold mine and the world’s fifth-largest silver producer, with production well in excess of three million ounces of gold and 160 million ounces of silver.

Grades:

  • Gold: 49 g/t
  • Silver: 2,406 g/t
  • Lead: 3.2%
  • Zinc: 5.2%

By the time all was said and done, the stock price of Stikine Resources would go from $1 to $67, after it was bought by International Corona.

Why did these three rich mines shut down?

Despite the gold in the Triangle being extremely high grade, lower gold prices in the late ’90s made the economics challenging. Meanwhile, the lack of infrastructure in this remote area meant that power, labour and logistics costs were sky high.

Both of these things have changed today, and activity at the Golden Triangle is now fast and furious.

Gaining access to the Triangle

The Golden Triangle is a hot area for exploration again. This is for three main reasons: higher gold prices, new infrastructure and modern discoveries.

Higher gold prices

Average gold price (1999): $279 (adjusted for inflation: $398)
Average gold price (2016): $1,202

Gold prices are more than three times as high today, even after adjusting for inflation. Combined with the Golden Triangle’s high grades, this becomes even more attractive.

New infrastructure

Today, road access to the area is easier than ever and a new transmission line will dramatically reduce the cost of power for companies operating in the Triangle.

Recent improvements:

  • Completion of a $700-million high-voltage transmission line to the Golden Triangle. The Northwest Transmission Line goes 335 kilometres from Terrace to Bob Quinn Lake and north to the Red Chris mine

  • Paving of the Stewart-Cassiar highway north from Smithers (Highway 37)

  • Opening of ocean port facilities for export of concentrate in Stewart

  • Completion of a three-dam, 277 MW hydroelectric facility located 70 kilometres northwest of Stewart

Modern discoveries

The next gold rush at the Golden Triangle has already started. Just some of the new discoveries in the area include Seabridge Gold’s (TSX:SEA) KSM project, Pretium Resources’ (TSX:PVG) Valley of the Kings deposit and Imperial Metals’ (TSX:III) Red Chris mine.

Yet despite this track record of new discoveries and mines being built in the area, a B.C. government report estimates that only 0.0006% of the Golden Triangle has been mined to date.

Posted with permission of Visual Capitalist.

MOU offers Americans scrutiny over B.C. mining projects

November 25th, 2015

by Greg Klein | November 25, 2015

British Columbians and Alaskans will seek involvement in each other’s mining proposals following a memorandum of understanding signed November 25. The MOU calls for governments and natives to take part in environmental assessment and permitting processes in their neighbour’s jurisdiction. But with an emphasis on trans-boundary waters, which mostly would consist of rivers and streams originating in B.C., Canadian projects might get more scrutiny than those next door.

B.C.-Alaska MOU pledges cross-border co-operation on mining and environment

The memo follows visits by B.C. mines minister Bill Bennett and Alaska lieutenant-governor Byron Mallott to each other’s turf. Bennett’s trips, following the tailings dam collapse at Imperial Metals’ (TSX:III) Mount Polley mine, tried to reassure Alaskans about B.C. environmental practices.

In August 2014, just weeks after the disaster, Alaska’s Department of Natural Resources asked Canada’s Environmental Assessment Agency for participation in the approval process for Seabridge Gold’s (TSX:SEA) KSM gold-copper project near the state border. Provincial approval had already been granted the previous month. The federal permit came through last December.

Other prominent projects in B.C.’s northwestern corner include:

  • Galore Creek, a NovaGold Resources TSX:NG/Teck Resources TSX:TCK.A and TCK.B copper-gold-silver project that reached pre-feasibility in 2011

  • Schaft Creek, a Copper Fox Metals TSXV:CUU/Teck copper-gold-molybdenum-silver project that achieved feasibility in 2013

  • Chieftain Metals’ (TSXV:CFB) Tulsequah Chief zinc-copper-gold project, now permitted for construction

  • Pretium Resources’ (TSX:PVG) Brucejack gold-silver project, slated for 2017 commercial production

  • Imperial’s Red Chris copper mine, which achieved commercial production in July

The MOU sets no timeframe for achieving its goals. Money for the cross-border initiative would come from existing government budgets, with the possibility of additional “alternate public or private sector funding.”

How fares Canada in the Fraser Institute’s global mining survey?

February 25th, 2015

by Greg Klein | February 25, 2015

Saskatchewan’s number two worldwide, Quebec’s back in the top 10 and Manitoba climbed 17 notches. But Alberta, Ontario and British Columbia took a beating in the latest Fraser Institute survey of mining jurisdictions. Released February 24, the study rates 122 jurisdictions (including provinces and states in Canada, the United States, Australia and Argentina) based on 485 returned questionnaires. Drawing on their 2014 experience, mining and exploration companies provided numerical ratings for a number of factors, which the institute tracked on separate indexes.

Most important is the Investment Attractiveness Index, which combines two other indexes—Best Practices Mineral Potential (geology) and Policy Perception (government attitudes). The institute weighs the IAI 60% for geology and 40% for public policy, roughly the same consideration companies reported for their investment decisions.

Here’s the top 10 IAI globally, with 2013 rankings in brackets:

1 Finland (4)
2 Saskatchewan (7)
3 Nevada (2)
4 Manitoba (13)
5 Western Australia (1)
6 Quebec (18)
7 Wyoming (11)
8 Newfoundland and Labrador (3)
9 Yukon (8)
10 Alaska (5)

Here are the Canadian runner-ups:

15 Northwest Territories (25)
21 New Brunswick (23)
22 Alberta (10)
23 Ontario (14)
28 British Columbia (16)
29 Nunavut (27)
42 Nova Scotia (47)

Prince Edward Island wasn’t included.

As for the bottom 10:

113 Sudan
114 Nigeria
115 Bulgaria
116 Guatemala
117 Egypt
118 Solomon Islands
119 Honduras
120 Kenya
121 Hungary
122 Malaysia

The 122 jurisdictions totalled 10 more than in 2013. For inclusion, the institute requires a minimum of 10 responses per jurisdiction.

The anonymous replies also included comments which, for Canadian provinces and territories, note serious but unsurprising concerns.

But for some people, the rankings rankled. B.C.’s 10th-place finish out of 12 Canadian jurisdictions doesn’t jibe with the province’s second-place status for mining investment, according to the Association for Mineral Exploration British Columbia. Citing data from Natural Resources Canada, AME BC credited Ontario as Canada’s favourite for attracting investment. Fraser Institute respondents stuck that province with ninth place in Canada.

“Furthermore, one of the best indicators of success in exploration is seeing discoveries move through to mine development,” said AME BC president/CEO Gavin Dirom. “In recent years, we have seen a number of new major metal mines constructed in our province, including Copper Mountain in 2011, New Afton in 2012 and Mount Milligan in 2013. Also, Red Chris is being readied for commercial operations, and the KSM and Kitsault mine development projects have received environmental assessment certificates.”

The NWT and Nunavut Chamber of Mines noted the Northwest Territories’ considerable improvement and its breakaway territory’s slight slump. The organization vowed to continue working with federal and territorial governments “to improve the investment climate for exploration and mining in the two territories.”

Download the Fraser Institute Survey of Mining Companies 2014.

Year in review

December 23rd, 2014

A mining and exploration retrospect for 2014

by Greg Klein

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Another difficult year notwithstanding, the resource sector failed to meet its apocalyptic doom. With a mixed bag of good, bad and quirky news, ResourceClips.com looks at some of the stories that helped characterize 2014.

Mount Polley to the breach

Even British Columbia’s environment minister called it a disaster. The August tailings dam collapse at Imperial Metals’ (TSX:III) Mount Polley copper-gold mine presented Canada’s mining industry with its own Exxon Valdez as a river of effluent, later estimated by the company at 24.4 million cubic metres, poured into the once-pristine Quesnel Lake watershed.

The dam’s original engineer was quick to disassociate itself. The current engineer and Imperial each implied the other might be at fault. There were suggestions that the company and the province should have known something was wrong as far back as 2010.

A mining and exploration retrospect for 2014

B.C. appointed a panel of engineers to investigate. B.C.’s Inspector of Mines began a separate investigation. And B.C.’s Information and Privacy Commissioner launched its own investigation—into the government.

B.C. also ordered third-party inspections of 98 tailings facilities at current and former mines. The Canadian Nuclear Safety Commission requested companies report on their uranium tailings facilities.

Alaskans, meanwhile, questioned whether B.C. had the wherewithal to prevent downstream pollution from potential mines in the province’s northwest. A Vancouver Sun study found that the BC Liberal government cut mine inspections by more than half since coming to power in 2001.

Imperial has so far committed $67.4 million towards the disaster. In late December the company announced the sale of a 93-kilometre transmission line extension to the government-owned BC Hydro for $52 million.

B.C.’s performance as a mining jurisdiction

Mount Polley’s shutdown brings to mind the governing BC Liberals’ frequent reminder that more mines closed than opened when the NDP held power. So how’s the province doing under the current regime? According to a list provided by the Ministry of Mines and Energy, seven mines opened since 2001, when the BC Liberals gained power, while five shut down. One mine closed and re-opened. Another seven mines opened and closed. At least one omission in the last category, however, was Treasure Mountain which opened, closed, re-opened and re-closed.

Of course metal and coal prices play a crucial role. But during that period permitting problems plagued other potential operations, like Taseko Mines’ (TSX:TKO) New Prosperity gold-copper project and Pacific Booker Minerals’ (TSXV:BKM) Morrison copper-gold-molybdenum project. Both were refused environmental permits, arguably on non-environmental grounds—New Prosperity by the feds and Morrison by the province.

On a more positive note, Imperial has its Red Chris copper-gold mine now in development. (Please get it right this time.) Seabridge Gold TSX:SEA won provincial environmental approval in July and federal approval in December for Kerr-Sulphurets-Mitchell (KSM), which the company says hosts “one of the largest undeveloped gold and copper reserves in the world.”

An engineering marvel puts Cigar Lake in operation

Evidently the mining industry calls for optimism and perseverance in abundance. That, along with innovation, is what it took for Cameco Corp TSX:CCO to finally bring its Cigar Lake uranium project into production in March. Encouraging the heroic endeavour is an ore grade 100 times the world average, suggesting that high grade is the mother of invention.

The Saskatchewan mine’s 33-year saga began with a 1981 discovery, then continued with a number of setbacks that stalled construction. Even after the mine’s widely celebrated opening, Cigar Lake shut down from mid-July to early September for remedial freezing. Majority-owner Cameco injects and freezes a brine solution around the rock body to prevent flooding through the Athabasca sandstone. Water jet boring then pummels the ore into a slurry.

But the company’s determination seems at odds with uranium’s price. When a Scotiabank analyst asked why Cameco was bringing new uranium into an oversupplied market, president/CEO Tim Gitzel replied, “We need the pounds. We’ve got sales commitments for those pounds.”

The uranium price tease

A mining and exploration retrospect for 2014

Chart: Ux Consulting

Among the most vociferous prophets of a new uranium order, Paladin Energy TSX:PDN managing director/CEO John Borshoff keeps revising his gotta-happen-soon predictions of rising prices. He’s not the only one, so Borshoff was probably more frustrated than embarrassed when uranium once again proved him wrong.

The recalcitrant commodity seemed to perk up in early August, with a spot price indicator that rose 25% by late October. A nearly 90-degree ascent to $44 by mid-November seemed to justify Borshoff’s outlook. Alas, fickle uranium let down its believers, along with its price.

Borshoff’s boosterism, however, is backed up by others including Cameco’s Gitzel and David Talbot of Dundee Capital Markets, who in November stated, “We have always said, just like in 2006-2007, when [longer-term] contracting begins and the price moves, it will move fast.”

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From B.C.’s Golden Triangle

February 14th, 2013

Teuton Resources and Rotation Minerals report gold-silver-polymetallic assays

by Greg Klein

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Initial drill results from the 4-Js property represent Teuton Resources’ TSXV:TUO “third successful” 2012 exploration program in northwestern British Columbia, the company states. The first set of assays, from near-surface drilling by optionee Rotation Minerals TSXV:ROT, were released February 14:

  • 0.61 grams per tonne gold, 71.66 g/t silver, 0.19% copper, 1.06% antimony, 1.9% lead and 5.4% zinc over 7.62 metres
  • (including 1.29 g/t gold, 140.5 g/t silver, 0.39% copper, 2.61% antimony, 3.23% lead and 11.93% zinc over 2.44 metres)
  • 0.3 g/t gold, 39 g/t silver, 0.1% copper, 0.32% antimony, 1.53% lead and 4.12% zinc over 9.15 metres
  • (including 0.43 g/t gold, 69.5 g/t silver, 0.23% copper, 0.66% antimony, 3.01% lead and 7.03% zinc over 3.05 metres)
  • 0.53 g/t gold, 41.5 g/t silver, 0.19% copper, 0.66% antimony, 1.83% lead and 4.48% zinc over 3.05 metres
  • 0.53 g/t gold, 30.7 g/t silver, 0.07% copper, 0.64% antimony, 2.4% lead and 3.44% zinc over 7.93 metres
  • 0.47 g/t gold, 89.3 g/t silver, 0.18% copper, 0.63% antimony, 1.79% lead and 5.74% zinc over 6.1 metres
  • 0.7 g/t gold, 156.5 g/t silver, 0.3% copper, 1.1% antimony, 2.5% lead and 9.43% zinc over 3.05 metres
  • 0.28 g/t gold, 39.5 g/t silver, 0.05% copper, 0.1% antimony, 1.5% lead and 3.76% zinc over 6.1 metres.
Teuton Resources and Rotation Minerals report gold-silver-polymetallic assays

The terrain is foreboding but northwestern B.C.
has given up some world-renowned reserves.

True widths weren’t available. Intercepts started at seven metres, with the deepest stopping at a down-hole depth of 27 metres. Still pending are assays from 17 more holes of the 1,345-metre program.

Targets were chosen following trenching that showed massive mineralization consisting of bournonite (copper-lead-antimony sulphide), tetrahedrite (copper-antimony-sulphide), sphalerite (zinc sulphide) and galena (lead sulphide) six metres wide and 30 metres long, the company stated. Underlying the mineralization is a strong EM anomaly stretching at least 700 metres. Along trend with the EM anomaly are float boulders carrying bournonite, sphalerite and galena, which the company said could potentially extend the mineralization at least 300 metres from the drill targets.

Four-Js is one of over 25 properties held by Teuton, the Golden Triangle’s largest landholder according to the company’s IR rep, Gary Assaly. Speaking to ResourceClips, he says the company’s flagship “currently is the High property, which is right next door to Pretium. We did some work last year on High North and High South and we came up with some good numbers on High North.” The High property is immediately northwest of 4-Js.

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Week in review

October 26th, 2012

A mining and exploration retrospect for October 20 to 26, 2012

by Greg Klein
Next Page 1 | 2

B.C. avalanche kills mining contractor

A surveyor working for Seabridge Gold TSX:SEA lost his life in northwestern British Columbia on Tuesday. According to a company statement, “Two experienced surveyors were working on a slope near the camp located at Sulphurets Creek when the avalanche occurred. One was able to get to safety; the other was swept into a gully and did not survive. A trained emergency rescue team was at the site of the accident within minutes.”

A mountainous, isolated but busy mining and exploration region east of the Alaska Panhandle, B.C.’s Golden Triangle is subject to heavy snow. Media reports, however, said the avalanche came unusually early in the season.

The B.C. Coroners Service identified the victim as 50-year-old Pat Lawrence Desmarais of Telkwa, B.C.

Cautious optimism about South Africa

A somewhat reassuring tone accompanied news from South Africa this week. On Thursday Bloomberg reported that “gold producers represented by the Chamber of Mines signed an agreement with labour unions over changes to pay and job categories today. Members have ‘overwhelmingly’ accepted the offer which, when added to a [previous] two-year deal, will see wages increase by as much as 20.8%.” Media accounts imply that as gold miners return to work, other miners will follow.

A mining and exploration retrospect

Also on Thursday, Reuters said the strikes caused Finance Minister Pravin Gordhan to cut his 2012 GDP forecast from 2.7% to 2.5%. He emphasized more time is needed to determine the strikes’ full impact but “we will take that knock, recover from it and move on because life doesn’t end now or next week. Life moves on.”

On Friday Kitco.com provided another weekly summary of how major companies are faring in South Africa.

Dehua debacle drags on

Mandarin is no longer a requirement for Canadian miners who want to work for Canadian Dehua International’s Canadian projects. But it’s “definitely an asset.”

The company ignited controversy earlier this month over its plan to import thousands of Chinese to work in four proposed coal mines in northeastern B.C. The federal and provincial governments support the plan, partly because the company said recruitment efforts within Canada failed. The United Steelworkers union then revealed that the company, along with HD Mining International (40% held by Canadian Dehua and 55% by Huiyong Holdings), had made Mandarin-language skills essential for at least 70 positions advertised in Canada.

Now the company has downgraded that requirement to “definitely an asset.” On Wednesday the Vancouver Province reported eight such ads on the Mining Association of British Columbia’s Web site. By Friday four were still in place, for a civil engineer, electrical engineer, mechanical engineer and mining engineer.

A Wednesday Vancouver Sun story reported that Canada’s New Democratic Party (NDP) urged the federal government to suspend the Chinese miners’ work permits “until an investigation determines whether Canadians were given an adequate chance to show they can fill the jobs.”

The outrage is hardly limited to Canada. On Friday Taiwanese animators Next Media Animation presented their take in a video. With admirable consideration for Canadians, they even provided an English-language version.

Read more about Canadian Dehua’s personnel policy here and here.

Central banks move in mysterious ways

Gold resumed its unsteady rise above $1,700 after dropping to Wednesday’s $1,698.70, the lowest price since September 7, Bloomberg reported. “More and more central banks are getting involved in the gold market,” the news agency quoted David Meger of Vision Financial Markets in Chicago. In an article re-posted by MarketWatch on Saturday, 24/7 Wall St. compared central bank gold reserves with their corresponding countries’ GDP and other economic highlights. There were some surprises.

The Netherlands ranks 63rd in the world for population and 17th for GDP, but ninth for gold reserves (612.5 tonnes). Like some other European countries, the Netherlands hasn’t yet sold all the gold required under the Central Bank Gold Agreement, 24/7 Wall St. stated. “It may need that gold to protect itself if the euro comes unravelled.”

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Seabridge reports BC Gold Assays as high as 0.56 g/t over 59.8m

January 4th, 2012

Resource Clips - essential news on junior gold mining and junior silver miningSeabridge Gold Inc TSX:SEA announced assays from the Kerr deposit of its KSM project in northwestern BC. Results include

0.56 g/t gold over 59.8 metres
0.53 g/t gold and 1.36% copper over 43.1 metres
0.44 g/t gold and 0.94% copper over 104.8 metres
(including 1.04 g/t gold and 1.88% copper over 34.3 metres)
0.6 g/t gold and 0.81% copper over 33.1 metres
0.59 g/t gold and 1.05% copper over 53.1 metres

President/CEO Rudi Fronk commented, “This drilling has opened up the Kerr deposit down dip with better than expected grades. The results strongly suggest that we can add further higher-grade copper mineralization in future programs. Meanwhile, the holes drilled this year have likely upgraded inferred and unclassified material within the planned pit and should therefore contribute to reserve expansion in the new KSM preliminary feasibility study planned for release in April 2012.”

View Company Profile

Read more about Seabridge Gold

Contact:
Rudi P. Fronk
President/CEO
416.367.9292

by Ted Niles

Seabridge reports BC Gold Assays as high as 2.49 g/t over 21m

November 22nd, 2011

Resource Clips - essential news on junior gold mining and junior silver miningSeabridge Gold Inc TSX:SEA announced results from its KSM project, located 65 kilometres northwest of Stewart, BC. Assays include

0.89 g/t gold over 99 metres
2.49 g/t over 21 metres
1.21 g/t over 20.4 metres
0.87 g/t over 105.5 metres
1.02 g/t over 35 metres
0.81 g/t over 54.3 metres
1.33 g/t over 16 metres
1.03 g/t over 42 metres
1.03 g/t over 22 metres
1.16 g/t over 22 metres
0.97 g/t over 32 metres

President/CEO Rudi Fronk said, “We are confident that this year’s program has successfully achieved all of our objectives. First, we believe we have converted significant amounts of in-pit waste to measured and indicated resources. Second, we have discovered new mineralization beneath the previous pit limit which will allow us to deepen the proposed pit and define new resources and reserves. Third, we expect that the overall strip ratio at Sulphurets will decline and economics will improve.”

View Company Profile

Read More about Seabridge Resources

Contact:
Rudi P Fronk
President/CEO
416.367.9292

by Ted Niles

A $26 Per Oz Bargain

October 25th, 2011

Seabridge Shares Are Cheap at the Price

By Ted Niles

Rudi Fronk believes Seabridge Gold Inc TSX:SEA is one of the cheapest gold stocks in the world. A glance at the numbers would seem to support this. At a market cap of roughly $1 billion, with proven and probable reserves at its KSM project in BC of 38.5 million ounces gold, Seabridge stock is now trading at approximately $26 per ounce. And that’s ignoring considerable additional reserves at the project, including 10 billion pounds copper.

The President and CEO notes that the nearest comparable company, NovaGold Resources Inc TSX:NG—with advanced-stage projects in Alaska and BC—is “trading at five to six times our valuation on a reserve basis.” He explains the inconsistency, “The big difference between NovaGold and Seabridge is they already have sponsorship in their projects with big joint venture partners [i.e. Barrick Gold Corporation ABX:CA and Teck Resources Limited TSX:TCK.B]; we don’t yet. When we get that sponsorship through joint ventures, we would expect to see a pretty significant re-rating in our share price. I’d say we’re getting close to that point now.”

Seabridge Shares Are Cheap at the Price

KSM is located 65 kilometres northwest of Stewart, BC and about 20 kilometres southeast of the past-producing Eskay Creek Mine. The project consists of four deposits—Kerr, Sulphurets, Mitchell and Iron Cap—and, in addition to the 38.5 million ounces gold and 10 billion pounds copper already mentioned, it has silver reserves of 214 million ounces and molybdenum reserves of 257 million pounds. Fronk declares, “KSM is the largest undeveloped gold-copper project in the world today in terms of reserves.”

The company is in the midst of a 12,000-metre infill drill program at the Sulphurets deposit to upgrade roughly three million ounces of inferred resources to reserves. October 20 assays include

  • 1.03 g/t gold and 0.1% copper over 182 metres
  • 0.96 g/t gold and 0.1% copper over 150 metres
  • 0.93 g/t gold and 0.51% copper over 143 metres
  • 0.74 g/t gold and 0.3% copper over 105 metres
  • 0.8 g/t gold and 0.47% copper over 86.5 metres
  • 0.38 g/t gold and 0.27% copper over 152 metres
  • 1.57 g/t gold and 0.04% copper over 36.6 metres

Fronk comments that the results “are better than what was expected. In addition to the inferred level, we’re also finding unclassified blocks that we’ll move up to higher categories as well. So I think our objective of three million ounces in addition to reserves is easily going to be achieved there.”

Calculated using a gold price of $1,069 per ounce, Seabridge’s May 2011 updated prefeasibility study gives a base case net present value (at a 5% discount rate) for the KSM project of $2.6 billion, an internal rate of return of 9.2% and a payback period of 6.6 years. The mine life is estimated to be 52 years with average life-of-mine cash operating costs of $231 per ounce of gold after base metal credits.

In addition to updating inferred resources at Sulphurets, Seabridge is also currently testing the Mitchell deposit for underground potential. “Mitchell is the largest of the four deposits—in fact it’s the largest gold deposit ever found in Canada,” Fronk says. “It now has more than a 40-year mine life on an open-pit basis, but there’s a lot of material down dip that is still there as resources. Our thought is, at some point in the Mitchell open-pit life, to move to a block-cave operation to reduce the amount of strip you have to do and continue going well beyond 40 years at Mitchell. We’ve engaged a consulting firm that’s very top-level in terms of block caving, and we did six deep holes for geotechnical purposes at Mitchell this year. One of the holes intersected 810 metres of continuous mineralization from the surface.” In other words, “This ore body is unbelievable.”

When we get that sponsorship through joint ventures, we would expect to see a pretty significant re-rating in our share price —Rudi Fronk

The next major step for Seabridge is permit applications. Fronk reports, “Best-case scenario is you’re looking at 2012 and 2013 for completing the permitting process, then probably a four to five year construction period for this project.”

In spite of its relative remoteness, the KSM project has certain logistical advantages over other major projects in northern BC; namely, it is the closest project of its size to existing roads, to BC Hydro’s Northwest Transmission Line (expected to be completed by late 2013) and to Stewart’s year-round, ice-free port. In addition, Seabridge finds itself in the advantageous position of being fully funded after the June 30 closing of a $30 million private placement with Royal Gold Inc TSX:RGL. (Royal Gold was also granted the option to acquire a 1.25% net smelter royalty on all gold and silver production sales from KSM for $100 million.)

Seabridge’s other major project—Courageous Lake, comprising 85% of the Courageous Lake Greenstone Belt in the Northwest Territories—is, according to Fronk, approximately a year and a half behind the KSM project. It has a mineral resource estimate of 6.8 million ounces gold measured and indicated, and 4.5 million ounces inferred. Seabridge is spending $16 million on the project this year and expects to have a prefeasibility study completed by 2Q 2012. “We’ll have more time and more resources to spend on it after we get the deal done on KSM,” Fronk says.

Fronk sums up, “[KSM] is a project—of scale now—that really few companies in the world have the technical and financial capabilities to build. We’re not one of them. We’ve had a very open-door policy with the big gold mining and base metal companies over the last several years with a view to, at some point, partnering up. We’ve done all the work that we should be doing, and it’s almost time to hand it over to a major in some sort of transaction. Our preferred structure is a joint venture, where we stay in the deal, but they do all the heavy lifting going forward.”

Seabridge has 42.4 million shares trading at $24.61 for a market cap of $1.04 billion. Its other projects include the Grassy Mountain and Quartz Mountain properties in Oregon, the Red Mountain project in BC and the Castle-Black Rock project in Nevada.

Seabridge President Rudi Fronk on BC assays of 1.03 g/t gold and 0.1% copper over 182m

October 21st, 2011

Resource Clips - essential news on junior gold mining and junior silver miningSeabridge Gold Inc TSX:SEA announced results from the Sulphurets Zone of its KSM Project in northwestern BC. Highlights include

1.03 g/t gold and 0.1% copper over 182 metres
0.96 g/t gold and 0.1% copper over 150 metres
0.93 g/t gold and 0.51% copper over 143 metres
0.74 g/t gold and 0.3% copper over 105 metres
0.8 g/t gold and 0.47% copper over 86.5 metres
0.38 g/t gold and 0.27% copper over 152 metres
1.57 g/t gold and 0.04% copper over 36.6 metres

President/CEO Rudi Fronk tells ResourceClips.com, “KSM is the largest undeveloped gold-copper project in the world today in terms of reserves. Contained within four separate deposits we have 38.5 million ounces of proven and probable gold reserves and 10 billion pounds of copper reserves. We’ve completed a prefeasibility on it that shows a very viable and robust project at current and even lower metal prices.

“The drilling we’re doing this year at Sulphurets and Kerr—two of the four deposits—is infill drilling. It’s within the confines of the open pits that were defined in the prefeasibility study. The drill holes are designed to upgrade the inferred resources to measured and indicated, so they can then be upgraded to proven and probable reserves. At Sulphurets we’re targeting about 3 million ounces of inferred, which is right now calculated as waste in the prefeasibility study, and obviously the results we’re getting back are converting those tonnes upward.

KSM is the largest undeveloped gold-copper project in the world today in terms of reserves. We have 38.5 million ounces of proven and probable gold reserves and 10 billion pounds of copper reserves—Rudi Fronk

“Today’s results are better than what was expected. In addition to the inferred level, we’re also finding unclassified blocks that we’ll move up to higher categories as well. So I think our objective of 3 million ounces in addition to reserves is easily going to be achieved there.

“The next big step is to file for the formal applications for permits,” Fronk continues. “The work we did this summer on the engineering side was geared so we can finish those applications. We’re also now looking at the opportunity of perhaps going underground at Mitchell at some point. Mitchell is the largest of the four deposits—in fact it’s the largest gold deposit ever found in Canada. It now has more than a 40-year mine life on an open-pit basis, but there’s a lot of material down dip that is still there as resources. Our thought is, at some point in the Mitchell open-pit life, to move to a block cave to reduce the amount of strip you have to do, reduce the amount of tonnes considerably and continue going well beyond 40 years at Mitchell. We’ve engaged a consulting firm that’s very top-level in terms of block caving, and we did six deep holes here for geotechnical purposes at Mitchell this year. One of the holes intersected 810 metres of continuous mineralization from the surface.” Fronk adds, “This ore body is unbelievable.”

Regarding the project’s infrastructure, Fronk notes, “We’re fortunate, in terms of these big undeveloped projects in northern BC, that we’re the closest major project to the existing roads. We’re about 20 miles south of the old Eskay Creek mine that Barrick shut down a few years ago. We’re the closest major project to where they’re taking the northwest transmission line up Highway 37—so we can tie into the grid for very cheap power. And we’re the closest major project to the port of Stewart that provides year-round access to the Pacific Ocean on the Portland Canal.

“This is a project—of scale now—that really few companies in the world have the technical and financial capabilities to build. We’re not one of them. We’ve had a very open-door policy with the big gold mining and base metal companies over the last several years with a view to, at some point, partnering up. I’d say we’re getting close to that point now.” Fronk concludes, “We’ve done all the work that we should be doing, and it’s almost time to hand it over to a major in some sort of transaction. Our preferred structure is a joint venture, where we stay in the deal but they do all the heavy lifting going forward.”

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Contact:
Rudi P. Fronk
President/CEO
416.367.9292

by Greg Klein and Ted Niles