Adding Deep Kerr and Iron Cap Lower Zones
Improves Economics, Reduces Environmental Risks
Base Case Life of Mine Operating Costs (Net of Cu and Ag
Credits) Estimated at Negative US$179 Per Ounce of Gold
Produced Total Cost (Including all Capital,
Operating and Closure Costs and Net of Cu and Ag Credits) Estimated
at US$358 Per OunceSmaller Footprint: 2.4 Billion
Tonnes (or 81%) Less Waste Rock Generated Compared to 2016
PFS
Seabridge Gold Inc. (TSX:SEA) (NYSE:SA) announced today the results
of a Preliminary Economic Assessment (the “PEA”) for its 100%-owned
KSM project located in northern British Columbia, Canada. Unlike
the updated Preliminary Feasibility Study (the “2016 PFS”)
announced on September 19, 2016, the PEA takes a different approach
to developing the KSM Project by incorporating the Deep Kerr Zone
and the Iron Cap Lower Zone into a conceptual project design.
The PEA was prepared by Amec Foster Wheeler. An
NI 43-101 Technical Report summarizing the results of the PEA, as
well as the 2016 PFS, will be filed at www.sedar.com.
The 2016 PFS incorporated KSM’s Measured and
Indicated Mineral Resources into mine plans generating Proven and
Probable Mineral Reserves of 2.2 billion tonnes grading 0.55 grams
per tonne gold, 0.21% copper and 2.6 grams per tonne silver (38.8
million ounces of gold, 10.2 billion pounds of copper and 183
million ounces of silver). (For details see
http://seabridgegold.net/News/Article/626/) The 2016 PFS could not
include the higher grade resources delineated at Deep Kerr and the
Iron Cap Lower Zone as they are in the Inferred Mineral Resources
category which cannot be considered as Mineral Reserves required
for inclusion in a PFS.
The PEA was undertaken to evaluate a different
approach to developing the KSM Project by emphasizing low cost
block cave mining and reducing the number and size of the open
pits, which significantly reduces the surface disturbances in the
re-designed project. The PEA assesses the potential impacts
of incorporating these inferred resources into project design,
capital and operating cost estimates and projected economics. The
results of the 2016 PFS remain valid and represent a viable option
for developing the KSM project, with the PEA assessing an
alternative development option at a conceptual level. The PEA is
preliminary in nature and includes Inferred Mineral Resources that
are considered too speculative geologically to have the economic
considerations applied to them that would enable them to be
categorized as Mineral Reserves, and there is no certainty that the
results of the PEA will be realized. Mineral Resources that are not
Mineral Reserves do not have demonstrated economic
viability.
Seabridge Gold Chairman and CEO Rudi Fronk noted
that “the PEA demonstrates the potential for significant project
improvements over the 2016 PFS. It is important to acknowledge that
the PEA includes Inferred Mineral Resources and is more conceptual,
not having the same amount of engineering work involved in a PFS.
The results are therefore not directly comparable. However, the PEA
should help our shareholders understand the potential value of the
exploration discoveries we have made at Deep Kerr and Lower Iron
Cap these past three years at considerable expense. I would also
note that we have had great success at KSM upgrading inferred
resources to higher categories and we therefore believe that the
improvements suggested by the PEA could be realized.”
The PEA under direction of Amec Foster Wheeler,
uses some of the 2016 PFS consulting team members. Notable changes
in the PEA include:
- In the PEA, open pits would account for only 22% of total
production compared to 70% in the 2016 PFS. In the PEA, the Kerr
Deposit would be mined exclusively as a large underground block
cave along with the Deep Kerr deposit below (together “Kerr”). The
PEA mine plans in total would reduce the amount of waste rock by
81% (by approximately 2.4 billion tonnes) compared to the PFS,
substantially shrinking the project’s foot print and its
environmental impact and reducing water treatment costs.
- By including Deep Kerr, annual average maximum throughput of
130,000 tonnes per day envisioned in the 2016 PFS has been
increased to 170,000 tonnes per day in the PEA without significant
redesign of facilities. Increased throughput would increase metal
production, reducing payback periods and improving estimated
projected internal rates of returns and net present values.
- In the PEA, estimated Base Case initial capital costs including
pre-production mining costs are about 9.7% higher than the 2016 PFS
due primarily to increased throughput. Base Case total cost per
ounce of gold produced in the PEA is estimated at US$358 compared
to US$673 per ounce in the 2016 PFS. The change in Base Case total
cost is due to higher by-product credits from significantly higher
copper production more than offsetting higher sustaining capital
for expanded underground development in the PEA. (see Projected
Economics table at end of release for breakdown of copper and
silver credits)
- As a result of approximately 77% more copper that would be
produced over the projected life, Base Case life of mine operating
costs in the PEA are estimated at negative US$179 per ounce of gold
produced, compared to the positive US$277 per ounce in the 2016 PFS
. (see Projected Economics table at end of release for breakdown of
copper and silver credits)
Commenting on the changes in the PEA, Fronk
concluded that “we are very excited by the sizeable potential
economic impact from including Deep Kerr in the project design as
well as the very significant environmental improvements that could
be realized. In our view, the PEA approach is likely to be an
attractive alternative for prospective partners.”
The PEA envisages a combined
open-pit/underground block caving mining operation that is planned
to operate for 51 years. Over the entire 51-year mine life,
mineralized material would be fed to a copper and gold extraction
mill. The flotation plant would produce a gold/copper/silver
concentrate for transport by truck to a nearby sea port at Stewart,
B.C. for shipment to Pacific Rim smelters. Metallurgical testing
indicates that KSM can produce a clean concentrate with an average
copper grade of 25% with a high gold and silver content, making it
readily saleable. Separate gold-silver doré would be produced at
the KSM processing facility.
Mineral ResourcesThe PEA is
based on the same Mineral Resources estimates that were used in the
2016 PFS. Measured and Indicated Mineral Resources at KSM are
estimated at 2.9 billion tonnes grading 0.54 grams per tonne gold,
0.21% copper and 2.7 grams per tonne silver (49.8 million ounces of
gold, 13.6 billion pounds of copper and 253 million ounces of
silver). An additional 2.7 billion tonnes are estimated in the
Inferred Resource category grading 0.35 grams per tonne gold, 0.32%
copper and 2.0 grams per tonne silver (30.8 million ounces of gold,
19.2 billion pounds of copper and 178 million ounces of silver). A
detailed breakdown of KSM’s Mineral Resources can be found at the
end of this news release.
Mine DesignThe PEA utilizes
Measured, Indicated and Inferred Mineral Resources in mine
planning. Material that is mined in the PEA is based on open pit
mining and underground block caving for the Mitchell deposit, open
pit mining for the Sulphurets deposit and underground block caving
for the Kerr and Iron Cap deposits. Approximately 22% of the mill
feed would come from open pit operations and 78% from underground
block caving. Waste to mill feed cut-offs were determined using a
Net Smelter Return (“NSR”) for each block in the model. NSR is
calculated using prices and process recoveries for each metal
accounting for all off-site losses, transportation, smelting and
refining charges. Metal prices of US$1,200 per ounce gold, US$2.70
per pound copper, and US$17.50 per ounce silver are used in the NSR
calculations.
Lerchs-Grossman (“LG”) pit shell optimizations
were used to define open pit mine plans in the PEA. The pit
limits of the PEA are contained inside the pit limits of the 2016
PFS. The mine design for the PEA focuses on reducing waste and
selecting higher block value. As a result the PEA mine plan
contains 2.4 billion tonnes less waste in the open pit mine
plan.
The underground block caving mine designs for
Mitchell, Iron Cap, and Kerr are based on modeling using GEOVIA’s
Footprint Finder (FF) and PCBC software. The ramp-up and maximum
yearly mine production rates were established based on the rate at
which the drawpoints are constructed, and the initial and maximum
production rates at which individual drawpoints can be mucked. The
values chosen for these inputs were based on industry averages
adjusted to suit the anticipated conditions.
Mitchell is estimated to have a production
ramp-up period of 5 years, steady state production at
21.9 million tonnes per year for 28 years, and then ramp-down
production for another 3 years. Iron Cap is estimated to have
a production ramp-up period of 3 years, steady state
production at 14.6 million tonnes per year for 11 years, and
then ramp-down production for another 4 years. Kerr is
estimated to have a production ramp-up period of 6 years, steady
state production at 25.5 million tonnes per year for 38 years with
some variations during years where the operation transitions from
first to second lift and second to third lift. Ramp down
lasts 4 years. The underground pre-production period is
5 years for Mitchell and Iron Cap and 3 years for Kerr. The
first underground mill feed production from Mitchell, Iron Cap and
Kerr comes in years 9, 10 and 4, respectively. The mining NSR
shut-off is Cdn$20 per tonne for the Mitchell underground mine,
Cdn$23 per tonne for the Iron Cap underground mine and Cdn$22 per
tonne for Kerr.
Mineral Resources contained in the mine plans
for the 2016 PEA are stated as follows.
Mineral
Resources in the PEA Mine Plan |
Zone |
Mining Method |
Classification |
Tonnes (millions) |
Average Grades |
Contained Metal |
Gold (gpt) |
Copper(%) |
Silver(gpt) |
Gold(millionounces) |
Copper(millionpounds) |
Silver(millionounces) |
Mitchell |
Open Pit |
Measured |
223.7 |
0.79 |
0.20 |
3.0 |
5.7 |
966 |
21.9 |
Indicated |
194.6 |
0.75 |
0.19 |
2.8 |
4.7 |
817 |
17.7 |
Inferred |
11.6 |
0.47 |
0.20 |
5.2 |
0.2 |
50 |
1.9 |
Block Cave |
Measured |
244.9 |
0.68 |
0.21 |
4.2 |
5.4 |
1134 |
33.1 |
Indicated |
361.0 |
0.65 |
0.20 |
4.1 |
7.5 |
1592 |
47.6 |
Inferred |
87.5 |
0.40 |
0.13 |
3.1 |
1.1 |
259 |
8.7 |
Iron Cap |
Block Cave |
Indicated |
121.5 |
0.64 |
0.24 |
4.1 |
2.5 |
643 |
15.8 |
Inferred |
77.4 |
0.46 |
0.22 |
3.5 |
1.1 |
384 |
8.7 |
Sulphurets |
Open Pit |
Indicated |
91.8 |
0.70 |
0.29 |
0.6 |
2.1 |
584 |
1.7 |
Inferred |
11.1 |
0.59 |
0.25 |
0.8 |
0.2 |
60 |
0.3 |
Kerr |
Block Cave |
Indicated |
24.4 |
0.26 |
0.54 |
1.1 |
0.2 |
290 |
0.8 |
Inferred |
931.5 |
0.31 |
0.49 |
1.7 |
9.3 |
9,962 |
52.0 |
Total Open Pit |
M+I |
510.1 |
0.76 |
0.21 |
2.5 |
12.4 |
2,367 |
41.2 |
Inferred |
22.7 |
0.53 |
0.22 |
3.1 |
0.4 |
111 |
2.2 |
Total Block Cave |
M+I |
751.8 |
0.64 |
0.22 |
4.0 |
15.6 |
3,659 |
97.3 |
Inferred |
1,096.4 |
0.33 |
0.44 |
2.0 |
11.6 |
10,605 |
69.3 |
Total Material Mined |
M+I |
1,261.8 |
0.69 |
0.22 |
3.4 |
28.0 |
6,026 |
138.6 |
Inferred |
1,119.1 |
0.33 |
0.43 |
2.0 |
12.0 |
10,716 |
71.6 |
ProductionThe mine production
plan starts in lower-cost open pit areas using conventional large
scale equipment before transitioning into block cave underground
bulk mining later in the mine life. Starter pits have been selected
in higher grade areas and cutoff grade strategy optimizes revenues
to minimize the payback duration.
After initial ramp-up the throughput averages of
170,000 tonnes per day (“tpd”) for the first 20 years, after the
rate is reduced to 130,000 tpd for the following 15 years and then
is further reduced to around 77,000 tpd for 12 years; during the
remaining 3 years of production, throughput averages 28,000 tpd. In
the PEA, KSM’s mine life is estimated at approximately 51 years.
Production starts from open pits at Mitchell and Sulphurets and
lasts until years 8 and 5 of production, respectively. During
that period the Kerr block cave is developed and first mill feed is
produced in year 4 of production. In year 9 and 10 Mitchell
and Iron Cap caves enter into production. Underground production
ends first at Iron Cap in year 27, then at Mitchell in year 44 and
finally at Kerr in year 51 of production.
At Mitchell, a near-surface higher grade gold
zone outcrops allowing for gold production in the first seven years
that is substantially above the mine life average grade. The mine
plan is specifically designed for mining highest gold grade first
to facilitate an early capital investment payback. The project’s
post-tax payback period is approximately 6.3 years for the Base
Case or less than 12% of mine life. A payback period representing
less than 20% of mine life is considered highly favorable. Metal
production for the first seven years, compared to life of mine
average production, is estimated as follows:
Average Annual Metal Production (metal
recovered) |
|
Years 1-7 Average |
Life of Mine Average |
Average Grades: |
|
|
Gold (grams per tonne) |
0.78 |
0.52 |
Copper (%) |
0.26 |
0.32 |
Silver (grams per tonne) |
2.7 |
2.7 |
Annual Production: |
|
|
Gold (000 ounces) |
1,150 |
592 |
Copper (000 pounds) |
306,603 |
286,217 |
Silver (000 ounces) |
3,290 |
2,761 |
Capital CostsInitial capital costs (including
contingency of US$927 million and preproduction mining costs) are
estimated at US$5.5 billion, approximately 9.7% higher than the
initial capital estimate in the 2016 PFS. Most of the cost increase
in initial capital is related to the higher throughput that
required a bigger mining fleet at the start of production, larger
size of equipment at the mill and changes in the tailing management
facility due to a higher mill rate. Also, contingency is higher to
reflect the lower level of cost accuracy of the PEA compared to the
2016 PFS.
Sustaining capital over the 51 year mine life is
estimated at US$10.0 billion and is dominated by capitalizing the
underground mine expansions at Kerr, Mitchell and Iron Cap block
caves. In addition to sustaining capital, a further US$540 million
has been charged against the project including US$454
million set aside in a sinking fund during the production
period to pay for estimated water treatment obligations which
continue after closure and US$86 million for physical
reclamation and other uses after mining operations have
ceased.
Initial capital and sustaining capital estimates
for the PEA are summarized as follows:
Capital Costs (US$ million) |
Direct Costs: |
|
Mine Site |
1,272 |
Process |
1,447 |
Tailing Management Facility |
509 |
Environmental |
15 |
On-site Infrastructure |
23 |
Off-site Infrastructure |
120 |
Permanent Electrical Power Supply and Energy Recovery |
167 |
Total Direct Costs |
3,553 |
Total Indirect Costs |
848 |
Owner’s Cost |
161 |
Contingency |
927 |
TOTAL INITIAL CAPITAL |
5,489 |
TOTAL LIFE OF MINE SUSTAINING CAPITAL |
10,018 |
Operating Costs Average
mine, process and G&A operating costs over the PEA project’s
life (including waste mining and on-site power credits, excluding
off-site shipping and smelting costs) are estimated at US$11.61 per
tonne milled (before base metal credits). Estimated unit operating
costs decreased 6% from the 2016 PFS primarily due to reduction in
process and G&A cost associated with higher throughput. A
breakdown of estimated unit operating costs is as follows:
LOM Average Unit Operating Costs (US$ Per Tonne
Milled) |
Mining |
4.47 |
Process |
5.19 |
G&A |
0.86 |
Others |
1.09 |
Total Operating Costs |
11.61 |
*excluding
pre-production cost of both open pit and underground
mining |
Economic AnalysisTo compare the economic
projections, the PEA incorporates the same three case analyses that
were presented in the 2016 PFS. A Base Case economic evaluation was
undertaken incorporating historical three-year trailing averages
for metal prices as of July 31, 2016. This approach adheres to
National Instrument 43-101 and is consistent with industry
practice. Two alternate cases were constructed: (i) a Recent Spot
Case incorporating recent spot prices for gold, copper, silver and
the US$/Cdn$ exchange rate; and (ii) an Alternate Case that
incorporates higher metal prices to demonstrate the project’s
sensitivity to rising prices. The pre-tax and post-tax estimated
economic results in U.S. dollars for all three cases compared to
the results of the 2016 PFS are as follows:
Projected
Economic Results (US$) |
|
Base Case |
Recent Spot |
Alternate |
2016 PEA |
2016 PFS |
2016 PEA |
2016 PFS |
2016 PEA |
2016 PFS |
Metal Prices: |
|
|
|
Gold ($/ounce) |
|
1,230 |
|
|
1,350 |
|
|
1,500 |
|
Copper ($/pound) |
|
2.75 |
|
|
2.20 |
|
|
3.00 |
|
Silver ($/ounce) |
|
17.75 |
|
|
20.00 |
|
|
25.00 |
|
US$/Cdn$ Exchange Rate: |
|
0.80 |
|
|
0.77 |
|
|
0.80 |
|
Cost Summary: |
|
|
|
|
|
|
Operating Costs Per Oz of Gold (life of mine) |
-$ |
179 |
|
$ |
277 |
|
$ |
32 |
|
$ |
404 |
|
-$ |
319 |
|
$ |
183 |
|
Total Cost Per Ounce of Gold Produced |
$ |
358 |
|
$ |
673 |
|
$ |
553 |
|
$ |
787 |
|
$ |
218 |
|
$ |
580 |
|
Copper Credits Per Oz Gold Included in Costs |
-$ |
1,328 |
|
-$ |
795 |
|
-$ |
1,104 |
|
-$ |
636 |
|
-$ |
1,449 |
|
-$ |
868 |
|
Silver Credits per Oz Gold Included in Costs |
-$ |
83 |
|
-$ |
71 |
|
-$ |
97 |
|
-$ |
80 |
|
-$ |
117 |
|
-$ |
100 |
|
Initial Capital (includes pre-production mining) |
$5.5 billion |
$5.0 billion |
$5.3 billion |
$4.8 billion |
$5.5 billion |
$5.0 billion |
Sustaining Capital |
$10.0 billion |
$5.5 billion |
$9.7 billion |
$5.3 billion |
$10.0 billion |
$5.5 billion |
Unit Operating Cost On-site (US$/tonne) |
$ |
11.61 |
|
$ |
12.36 |
|
$ |
11.17 |
|
$ |
12.09 |
|
$ |
11.61 |
|
$ |
12.36 |
|
Pre-Tax Results: |
|
|
|
|
|
|
Net Cash Flow |
$26.3 billion |
$15.9 billion |
$24.1 billion |
$16.1 billion |
$38.7 billion |
$26.3 billion |
NPV @ 5% Discount Rate |
$6.1 billion |
$3.3 billion |
$5.7 billion |
$3.5 billion |
$10.2 billion |
$6.5 billion |
Internal Rate of Return |
|
12.7 |
% |
|
10.4 |
% |
|
12.9 |
% |
|
11.1 |
% |
|
16.9 |
% |
|
14.6 |
% |
Payback Period (years) |
|
5.6 |
|
|
6.0 |
|
|
5.3 |
|
|
5.6 |
|
|
3.9 |
|
|
4.1 |
|
Post-Tax Results: |
|
|
|
|
|
|
Net Cash Flow |
$16.7 billion |
$10.0 billion |
$15.3 billion |
$10.1 billion |
$24.7 billion |
$16.7 billion |
NPV @ 5% Discount Rate |
$3.4 billion |
$1.5 billion |
$3.2 billion |
$1.7 billion |
$6.0 billion |
$3.7 billion |
Internal Rate of Return |
|
10.0 |
% |
|
8.0 |
% |
|
10.1 |
% |
|
8.5 |
% |
|
13.4 |
% |
|
11.4 |
% |
Payback Period (years) |
|
6.4 |
|
|
6.8 |
|
|
6.1 |
|
|
6.4 |
|
|
4.7 |
|
|
4.9 |
|
Note: Operating and total cost
per ounce of gold are after copper and silver credits. Total cost
per ounce include all start-up capital, sustaining capital and
reclamation/closure costs. The post-tax results include the B.C.
Mineral Tax and corporate provincial and federal taxes.
The NI 43-101 Technical Report will include
sensitivity analyses illustrating the impact on project economics
from positive and negative changes to metal prices, capital costs
and operating costs.
National Instrument 43-101
Disclosure The 2016 KSM PEA was prepared by Amec Foster
Wheeler, and incorporates the work of a number of industry-leading
consulting firms. These firms and their Qualified Persons (as
defined under National Instrument 43-101) are independent of
Seabridge and have reviewed and approved this news release. The
principal consultants who contributed to the 2016 PEA, and their
Qualified Persons are listed below along with their areas of
responsibility:
- Amec Foster Wheeler. under the direction of Simon Allard
P.Eng., Mark Ramirez RM SME and Tony Lipiec P.Eng (Underground and
open pit design , RSF design, process design and capital and
operating costs).
- Klohn Crippen Berger Ltd. under the direction of Graham
Parkinson P. Geo. (Design of surface water diversion, diversion
tunnels and seepage collection ponds, tailing dam, water storage
dam and tunnel geotechnical). Graham Parkinson has been to the
site.
- Resource Modeling Inc. under the direction of Michael Lechner
P.Geo (Mineral Resources). Michael Lechner has been to site.
- Golder Associates Inc. under the direction of Ross Hammett P.
Eng (Block caving assessments). Ross Hammett has been to the
site.
Seabridge Gold holds a 100% interest in several
North American gold resource projects. The Company’s principal
assets are the KSM property located near Stewart, British Columbia,
Canada and the Courageous Lake gold project located in Canada’s
Northwest Territories. For a breakdown of Seabridge Gold’s mineral
reserves and resources by project and category please visit the
Company’s website at
http://www.seabridgegold.net/resources.php.
All Mineral Reserve and Mineral Resources
estimates reported by the Corporation were estimated in accordance
with the Canadian National Instrument 43-101 and the Canadian
Institute of Mining and Metallurgy Definition Standards. These
standards differ significantly from the requirements of the U.S.
Securities and Exchange Commission. Mineral Resources which are not
Mineral Reserves do not have demonstrated economic viability.
This document contains "forward-looking
information" within the meaning of Canadian securities legislation
and “forward-looking statements” within the meaning of the United
States Private Securities Litigation Reform Act of 1995. This
information and these statements, referred to herein as
“forward-looking statements” are made as of the date of this
document. Forward-looking statements relate to future events or
future performance and reflect current estimates, predictions,
expectations or beliefs regarding future events and include, but
are not limited to, statements with respect to: (i) the estimated
amount and grade of Mineral Resources and mineral reserves; (ii)
that both the PFS and the PEA represent viable development options
for the Project and that the PEA is likely an attractive
alternative for prospective partners; (iii) estimates of the
capital costs of constructing mine facilities and bringing a mine
into production, of sustaining capital and the duration of
financing payback periods; (iv) the estimated amount of future
production, both produced and metal recovered; and (v) estimates of
operating costs and total costs, net cash flow, net present value
and economic returns from an operating mine; and (vi) the expected
positive impact on project economics of the Deep Kerr and Iron Cap
Lower Zone. Any statements that express or involve discussions with
respect to predictions, expectations, beliefs, plans, projections,
objectives or future events or performance (often, but not always,
using words or phrases such as “expects”, “anticipates”, “plans”,
“projects”, “estimates”, “envisages”, “assumes”, “intends”,
“strategy”, “goals”, “objectives” or variations thereof or stating
that certain actions, events or results “may”, “could”, “would”,
“might” or “will” be taken, occur or be achieved, or the negative
of any of these terms and similar expressions) are not statements
of historical fact and may be forward-looking statements.
All forward-looking statements are based on
Seabridge's or its consultants' current beliefs as well as various
assumptions made by them and information currently available to
them. The most significant assumptions are set forth above, but
generally these assumptions include: (i) the presence of and
continuity of metals at the Project at estimated grades; (ii) the
geotechnical and metallurgical characteristics of rock conforming
to sampled results; including the quantities of water and the
quality of the water that must be diverted or treated during mining
operations; (iii) the capacities and durability of various
machinery and equipment, including the rates at which drawpoints
can be established and mucked; (iv) the availability of personnel,
machinery and equipment at estimated prices and within the
estimated delivery times; (v) currency exchange rates; (vi) metals
sales prices and exchange rate assumed; (vii) appropriate discount
rates applied to the cash flows in the economic analysis; (viii)
tax rates and royalty rates applicable to the proposed mining
operation; (ix) the availability of acceptable financing under
assumed structure and costs; (ix) anticipated mining losses and
dilution; (x) metallurgical performance; (xi) reasonable
contingency requirements; (xii) success in realizing proposed
operations; (xiii) receipt of permits and other regulatory
approvals on acceptable terms; and (xiv) the negotiation of
satisfactory terms with impacted Treaty and First Nations groups.
Although management considers these assumptions to be reasonable
based on information currently available to it, they may prove to
be incorrect. Many forward-looking statements are made assuming the
correctness of other forward looking statements, such as statements
of net present value and internal rates of return, which are based
on most of the other forward-looking statements and assumptions
herein. The cost information is also prepared using current values,
but the time for incurring the costs will be in the future and it
is assumed costs will remain stable over the relevant period.
By their very nature, forward-looking statements
involve inherent risks and uncertainties, both general and
specific, and risks exist that estimates, forecasts, projections
and other forward-looking statements will not be achieved or that
assumptions do not reflect future experience. We caution readers
not to place undue reliance on these forward-looking statements as
a number of important factors could cause the actual outcomes to
differ materially from the beliefs, plans, objectives,
expectations, anticipations, estimates assumptions and intentions
expressed in such forward-looking statements. These risk factors
may be generally stated as the risk that the assumptions and
estimates expressed above do not occur as forecast, but
specifically include, without limitation: risks relating to
variations in the mineral content within the material identified as
Mineral Resources from that predicted; variations in rates of
recovery and extraction; the geotechnical characteristics of the
rock mined or through which infrastructure is built differing from
that predicted, the quantity of water that will need to be diverted
or treated during mining operations being different from what is
expected to be encountered during mining operations or post
closure, or the rate of flow of the water being different;
developments in world metals markets; risks relating to
fluctuations in the Canadian dollar relative to the US dollar;
increases in the estimated capital and operating costs or
unanticipated costs; difficulties attracting the necessary work
force; increases in financing costs or adverse changes to the terms
of available financing, if any; tax rates or royalties being
greater than assumed; changes in development or mining plans due to
changes in logistical, technical or other factors; changes in
project parameters as plans continue to be refined; risks relating
to receipt of regulatory approvals or settlement of an agreement
with impacted First Nations groups; changes in regulations applying
to the development, operation, and closure of mining operations
from what currently exists; the effects of competition in the
markets in which Seabridge operates; operational and infrastructure
risks and the additional risks described in Seabridge's Annual
Information Form filed with SEDAR in Canada (available at
www.sedar.com) for the year ended December 31, 2015 and in the
Corporation’s Annual Report Form 40-F filed with the U.S.
Securities and Exchange Commission on EDGAR (available at
www.sec.gov/edgar.shtml). Seabridge cautions that the foregoing
list of factors that may affect future results is not
exhaustive.
When relying on our forward-looking statements
to make decisions with respect to Seabridge, investors and others
should carefully consider the foregoing factors and other
uncertainties and potential events. Seabridge does not undertake to
update any forward-looking statement, whether written or oral, that
may be made from time to time by Seabridge or on our behalf, except
as required by law.
ON BEHALF OF THE BOARD
"Rudi Fronk" President & C.E.O.
For further information, please contact:Rudi P. Fronk, President
and C.E.O.Tel: (416) 367-9292 · Fax: (416)
367-2711Email: info@seabridgegold.net
KSM
Mineral Resources as of May 31, 2016 |
Zone |
Type of Constraint |
NSR Cut-off (Cdn$/t) |
Tonnes (000 t) |
Grades |
Contained Metal |
Au (g/t) |
Cu (%) |
Ag (g/t) |
Mo (ppm) |
Au (000 oz) |
Cu (Mlb) |
Ag (000 oz) |
Mo (Mlb) |
Measured Mineral Resources |
Mitchell |
Conceptual LG Pit |
9 |
698,800 |
0.63 |
0.17 |
3.1 |
59 |
14,154 |
2,618 |
69,647 |
91 |
Conceptual Block Cave |
16 |
51,300 |
0.59 |
0.20 |
4.7 |
41 |
973 |
226 |
7,752 |
5 |
Total Mitchell Measured |
n/a |
750,100 |
0.63 |
0.17 |
3.2 |
58 |
15,127 |
2,844 |
77,399 |
96 |
Total Measured |
n/a |
n/a |
750,100 |
0.63 |
0.17 |
3.2 |
58 |
15,127 |
2,844 |
77,399 |
96 |
Indicated Mineral Resources |
Kerr |
Conceptual LG Pit |
9 |
355,000 |
0.22 |
0.41 |
1.1 |
4 |
2,511 |
3,208 |
12,555 |
3 |
Conceptual Block Cave |
16 |
24,400 |
0.24 |
0.48 |
2.0 |
14 |
188 |
258 |
1,569 |
1 |
Total Kerr Indicated |
n/a |
379,400 |
0.22 |
0.41 |
1.2 |
5 |
2,699 |
3,466 |
14,124 |
4 |
Sulphurets |
Conceptual LG Pit |
9 |
381,600 |
0.58 |
0.21 |
0.8 |
48 |
7,116 |
1,766 |
9,815 |
40 |
Mitchell |
Conceptual LG Pit |
9 |
919,900 |
0.57 |
0.16 |
2.8 |
61 |
16,858 |
3,244 |
82,811 |
124 |
Conceptual Block Cave |
16 |
124,700 |
0.58 |
0.20 |
4.7 |
38 |
2,325 |
550 |
18,843 |
10 |
Total Mitchell Indicated |
n/a |
1,044,600 |
0.57 |
0.16 |
3.0 |
58 |
19,183 |
3,794 |
101,654 |
134 |
Iron Cap |
Conceptual Block Cave |
16 |
346,800 |
0.51 |
0.23 |
4.5 |
14 |
5,686 |
1,758 |
50,174 |
11 |
Total Indicated |
n/a |
n/a |
2,152,400 |
0.50 |
0.23 |
2.5 |
40 |
34,684 |
10,784 |
175,767 |
189 |
Measured + Indicated Mineral
Resources |
Kerr |
Conceptual LG Pit |
9 |
355,000 |
0.22 |
0.41 |
1.1 |
4 |
2,511 |
3,208 |
12,555 |
3 |
Conceptual Block Cave |
16 |
24,400 |
0.24 |
0.48 |
2.0 |
14 |
188 |
258 |
1,569 |
1 |
Total Kerr M+I |
n/a |
379,400 |
0.22 |
0.41 |
1.2 |
5 |
2,699 |
3,466 |
14,124 |
4 |
Sulphurets |
Conceptual LG Pit |
9 |
381,600 |
0.58 |
0.21 |
0.8 |
48 |
7,116 |
1,766 |
9,815 |
40 |
Mitchell |
Conceptual LG Pit |
9 |
1,618,700 |
0.60 |
0.16 |
2.9 |
60 |
31,012 |
5,862 |
152,458 |
215 |
Conceptual Block Cave |
16 |
176,000 |
0.58 |
0.20 |
4.7 |
39 |
3,298 |
776 |
26,595 |
15 |
Total Mitchell M+I |
n/a |
1,794,700 |
0.60 |
0.16 |
3.1 |
58 |
34,310 |
6,638 |
179,053 |
230 |
Iron Cap |
Conceptual Block Cave |
16 |
346,800 |
0.51 |
0.23 |
4.5 |
14 |
5,686 |
1,758 |
50,174 |
11 |
Total M + I |
n/a |
n/a |
2,902,500 |
0.54 |
0.21 |
2.7 |
44 |
49,811 |
13,628 |
253,166 |
285 |
Inferred Mineral Resources |
Kerr |
Conceptual LG Pit |
9 |
80,200 |
0.27 |
0.21 |
1.1 |
6 |
696 |
371 |
2,836 |
1 |
Conceptual Block Cave |
16 |
1,609,000 |
0.31 |
0.43 |
1.8 |
25 |
16,036 |
15,249 |
93,115 |
89 |
Total Kerr Inferred |
n/a |
1,689,200 |
0.31 |
0.42 |
1.8 |
24 |
16,732 |
15,620 |
95,951 |
90 |
Sulphurets |
Conceptual LG Pit |
9 |
182,300 |
0.46 |
0.14 |
1.3 |
28 |
2,696 |
563 |
7,619 |
11 |
Mitchell |
Conceptual LG Pit |
9 |
317,900 |
0.37 |
0.09 |
3.0 |
56 |
3,782 |
631 |
30,662 |
39 |
Conceptual Block Cave |
16 |
160,500 |
0.51 |
0.17 |
3.5 |
44 |
2,632 |
601 |
18,061 |
16 |
Total Mitchell Inferred |
n/a |
478,400 |
0.38 |
0.10 |
3.0 |
55 |
6,414 |
1,232 |
48,723 |
55 |
Iron Cap |
Conceptual Block Cave |
16 |
369,300 |
0.42 |
0.22 |
2.2 |
21 |
4,987 |
1,791 |
26,121 |
17 |
Total Inferred |
n/a |
n/a |
2,719,200 |
0.35 |
0.32 |
2.0 |
29 |
30,829 |
19,206 |
178,414 |
173 |
Note: Mineral Resources are
reported inclusive of the Mineral Resources that were converted to
Mineral Reserves. Mineral Resources which are not Mineral Reserves
do not have demonstrated economic viability. It is reasonably
expected that the majority of Inferred Mineral Resources could be
upgraded to Indicated Mineral Resources with continued
exploration.
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