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April 15, 2002
Seabridge Completes Acquisition of Red Mountain Gold Project
Toronto (Canada) — Seabridge Resources announced
today that it has completed its acquisition of a 100% interest in the Red Mountain
Gold Project located near Stewart, British Columbia from Wheaton River Minerals
Ltd ("WRM"). The Red Mountain project contains a gold resource of 483,000 ounces
(400,000 measured and indicated and 83,000 inferred) which conforms with the
definitions in National Instrument 43-101 for resource disclosure.
Red Mountain is a structurally-controlled, advanced stage gold deposit
located 18 kilometers east of Stewart, British Columbia. The deposit was
originally drilled by Bond Gold in the late 1980s, and was subsequently
explored by Lac Minerals and Royal Oak Mines. To date, approximately US$39
million has been spent by previous owners at Red Mountain. Diamond drilling
on the property has totaled 127,000 metres in 467 holes. In addition, 2,000
metres of underground workings have been excavated, including a 1,000-metre
production-sized decline. Significant metallurgical testing has also been
performed on the deposit with results indicating that recoveries of 87-90%
can be achieved through conventional milling.
Numerous resource estimates have been reported by previous owners
of Red Mountain. In May 2001, WRM completed a comprehensive review and
validation of the project's geological and environmental data. This review
included re-logging all drill core and the construction of a new kriged
resource block model. Prior to closing, Seabridge commissioned an
independent technical review of the new resource model and, in the process,
satisfied the requirements under National Instrument 43-101 for public disclosure.
The new model for Red Mountain estimates measured resources of 1.26 million
tonnes grading 8.01 grams of gold per tonne (324,000 ounces) plus an indicated
resource of 0.34 million tonnes grading 7.04 grams of gold per tonne (76,000 ounces)
for a total measured and indicated gold resource of 400,000 ounces. In the
inferred category, the project contains an additional 0.35 million tonnes grading
7.45 grams of gold per tonne (83,000 ounces).
At closing, Seabridge issued Wheaton River Minerals Ltd. 800,000 Seabridge
common shares in exchange for a 100% interest in the Red Mountain project which
includes: (i) 97 mineral claims comprising 19,030 hectares; (ii) all project
data including an extensive, high-quality data base and drill core repository;
(iii) an office/warehouse building in Stewart; (iv) a large complement of mining
equipment at the Red Mountain site; (v) mineral exploration permit MX-1-422
and (vi) a $1.5 million cash reclamation deposit lodged with the B.C. Mines
Ministry and related obligations.
In January 2002, WRM filed a revised reclamation plan with the B.C.
Mines Ministry which has been accepted by the Ministry, reducing the $1.5
million cash reclamation deposit to $1.0 million. Of the $500,000 being
released by the Ministry, approximately $350,000 will be retained by Seabridge
and approximately $150,000 will be paid to WRM.
Also at closing Seabridge assumed net smelter royalty obligations
ranging from 2 to 6.5% and annual holding costs of approximately $75,000.
"Consistent with our strategy, this acquisition adds a quality gold
resource with low holding costs. We have already realized additional value
for Seabridge shareholders from the cash being released from the reclamation
bond and believe that further value can be realized through the subsequent
sale of the mining equipment purchased," said Seabridge President and CEO Rudi Fronk.
As part of this transaction, the Company has issued 40,000 shares to National
Financial Bank Financial of Toronto, Ontario, as a finder's fee for its role
in this acquisition. The 800,000 shares issued to WRM and the shares issued
as a finder's fee will have hold periods expiring on August 11, 2002.
Seabridge also stated that it has closed its previously announced $800,000
convertible debenture financing from Pan Atlantic Bank and Trust Ltd. (see news
release of March 1, 2002). Pan Atlantic of Bridgetown, Barbados, W.I., a bank
registered under the Off-Shore Bank Act of Barbados, is a wholly owned subsidiary
of FCMI Financial Corporation of Toronto and an affiliate of Friedberg Mercantile
Group, a Toronto based investment dealer and futures commission merchant. The
debenture and any common shares of the Company issued on conversion of the
debenture are subject to a hold period expiring on July 28, 2002.
Seabridge has been designed to provide its shareholders maximum leverage to
the price of gold. The Company has entered into agreements covering 13.8 million
ounces of gold resources in North America, of which 8.0 million ounces are
measured and indicated. (See Gold Resources Table
and press release dated January 30, 2002).
The Company continues to seek expansion of its gold
resource base by acquisition of new projects and exploration
programs largely funded by partners.
All resource estimates reported in this
disclosure are calculated in accordance with the Canadian
National Instrument 43-101 and the Canadian Institute
of Mining and Metallurgy Classification system. These
standards differ significantly from the requirements of
the U.S. Securities and Exchange Commission.
Statements relating to the estimated or expected future
production and operating results and costs and financial
condition of Seabridge, planned work at the CompanyÁs
projects and the expected results of such work are forward-looking
statements within the meaning of the United States Private
Securities Litigation Reform Act of 1995. Forward-looking
statements are statements that are not historical facts
and are generally, but not always, identified by words
such as the following: expects, plans, anticipates, believes,
intends, estimates, projects, assumes, potential and similar
expressions.ň Forward-looking statements also include
reference to events or conditions that will, would, may,
could or should occur.ň Information concerning exploration
results and mineral reserve and resource estimates may
also be deemed to be forward-looking statements, as it
constitutes a prediction of what might be found to be
present when and if a project is actually developed. These
forward-looking statements are necessarily based upon
a number of estimates and assumptions that, while considered
reasonable at the time they are made, are inherently subject
to a variety of risks and uncertainties which could cause
actual events or results to differ materially from those
reflected in the forward-looking statements, including,
without limitation: uncertainties related to raising sufficient
financing to fund the planned work in a timely manner
and on acceptable terms; changes in planned work resulting
from logistical, technical or other factors; the possibility
that results of work will not fulfill projections/expectations
and realize the perceived potential of the CompanyÁs projects;
uncertainties involved in the interpretation of drilling
results and other tests and the estimation of gold reserves
and resources; risk of accidents, equipment breakdowns
and labour disputes or other unanticipated difficulties
or interruptions; the possibility of environmental issues
at the CompanyÁs projects; the possibility of cost overruns
or unanticipated expenses in work programs; the need to
obtain permits and comply with environmental laws and
regulations and other government requirements; fluctuations
in the price of gold and other risks and uncertainties,
including those described in the CompanyÁs Annual Information
Form filed with SEDAR (available at www.sedar.com)
for the year ended December 31, 2002.
Forward-looking statements
are based on the beliefs, estimates and opinions of the
CompanyÁs management or its independent professional consultants
on the date the statements are made. Seabridge undertakes
no obligation to update these forward-looking statements
if such beliefs, estimates or opinions or other factors
should change.
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 ů Fax: (416) 367-2711
Email: info@seabridgegold.net
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