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The United States Forest Service (USFS) would be the lead regulatory agency on the federal
level that is responsible for review and approval of mining activities at Quartz Mountain.
The USFS´s mineral permitting program is triggered by the submittal of a Notice of Intent (NOI)
to mine, and detailed Plan of Operations (POO). A POO is usually developed following the completion
of a detailed Feasibility Study that outlines the optimum mining and processing method(s) and the
specifics of a proposed project. The USFS is responsible for reviewing potential environmental impacts
of the proposed project, and if necessary, the development of project-specific mitigation and reclamation.
In addition, the USFS is responsible for soliciting public participation (comment and review) on the
proposed project. Depending upon the level of impact and the amount of public interest, the USFS
recommends that an Environmental Assessment (EA) or an Environmental Impact Statement (EIS) be performed.
The key differences between these evaluations is the amount of public participation, the time necessary
to obtain approval, and the amount of resources needed to obtain approval.
The Quartz Mountain Project is characterized as a development project that has undergone
considerable exploration and a Feasibility Study level evaluation of an open pit(s) mine with
heap leach processing in the mid-to-late 1980´s. Environmental baselines and monitoring at
Quartz Mountain were initiated by previous owners in the late 1980´s. These activities were
directed by SRK Consulting´s Reno Office. Many local specialists were used to support this
effort. These reports are valuable in assessing impacts and making recommendations for
future work. The reports also provide valuable information that may be used by Seabridge
in limiting liability as well as supporting future efforts should Seabridge decide to proceed
with development of a particular development plan at the Quartz Mountain Project.
To further study the permitting issues at Quartz Mountain, Seabridge retained Gochnour
& Associates of Parker, Colorado (“Gochnour”) to undertake an environmental review and
regulatory permitting due diligence on Quartz Mountain. The report of Gochnour is entitled
“Quartz Mountain Project; Permitting/Environmental Report” (the “QMP P/E Report”) and dated
November 28, 2001. The following material was drawn from the QMP P/E Report. The Gochnour
study examined various potential development scenarios including an open pit and/or
underground mining operations. Processing alternatives include on-site milling and/or heap
leach technology utilizing cyanide, and off-site processing (toll milling). Waste disposal
alternatives include overburden stockpiles adjacent to the orebody (under an open pit scenario).
With an underground or combination open-pit/underground mining scenario, waste could be used as
backfill and/or stockpiled on the surface, adjacent to mining operations. Each Alternative would
require the development of a different reclamation strategy.
Gochnour concluded that each of the development scenarios are permittable under current
federal and state law. To complete the permitting process, Gochnour estimates that the open-pit
scenario would take 3-5 years to permit once a Plan of Operations (“POO”) had been submitted.
Gochnour estimated the permitting time frame for the underground scenarios at 2-3 years after
the POO was submitted.
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