New Drilling Supports Partial Underground Scenario at Seabridge Gold's Mitchell Deposit
TORONTO, CANADA--(Marketwire
- Sept. 22, 2011) - Seabridge Gold
(TSX:SEA)(NYSE Amex:SA) reported today that five geotechnical
holes drilled this summer at KSM's Mitchell deposit could dramatically reshape
the project's design, improve its economics and reduce its potential impact on
the environment. Located in northwestern British Columbia, Seabridge's
100% owned KSM is Canada's largest undeveloped gold project.
The
five holes were recommended by Golder Associates, a
leading independent consultant specializing in underground mining. The
objective was to assess the potential for a cost-effective panel cave operation
at Mitchell to access the deeper portions of the deposit from underground
following an initial phase of open pit mining as set out in the project's
current Preliminary Feasibility Study (PFS). The five holes support the
potential for cost-effective panel caving to access the deeper Mitchell
material while substantially reducing strip ratios and waste rock volumes.
These holes confirm the initial caving assumptions of competent rock in both
the ore and development zones. Each of the holes also returned very long runs
of excellent grade down to the levels which Golder
Associates has proposed for underground development.
Seabridge President Rudi Fronk commented that these holes should provide the
necessary information to define reserves for an underground panel cave
operation at Mitchell. "KSM already has robust economics in the current
PFS design. However, we wanted to find a way to access the deeper ore which
would be left at the bottom of the proposed pit and reduce the amount of waste
rock which the pit would generate. Recognizing that panel caving had the
potential to meet both goals, we engaged Golder
Associates to study the potential for an underground scenario at Mitchell.
Preliminary work by Golder Associates suggested that
panel caving could work cost-effectively. Golder
Associates will now upgrade its preliminary design using the geotechnical and
other data provided by these five holes. We expect to announce the results of
this study shortly."
Mr.
Fronk noted that project design and engineering
enhancements of the original 2010 KSM PFS "continue to generate
significant gains which will make this project more attractive to major
producers."
Assay
results of the five geotechnical holes drilled this year at Mitchell are as
follows:
2011
Mitchell Geotechnical Drill Hole Results
|
Hole ID
|
Total Depth (m)
|
From (m)
|
To (m)
|
Thickness (m)
|
Gold
(g/T)
|
Copper
(%)
|
M-11-122
|
636.0
|
3.6
|
636.0
|
632.4
|
0.67
|
0.21
|
M-11-123
|
631.5
|
4.0
|
362.0
|
358.0
|
0.90
|
0.23
|
|
|
378.0
|
402.4
|
24.4
|
0.66
|
0.24
|
|
|
410.0
|
494.0
|
84.0
|
0.56
|
0.17
|
|
|
548.0
|
565.0
|
17.0
|
0.52
|
0.18
|
M-11-124
|
687.0
|
3.9
|
687.0
|
683.1
|
0.80
|
0.21
|
|
Including
|
18.0
|
465.20
|
447.2
|
0.97
|
0.26
|
M-11-125
|
810.0
|
0.2
|
810.0
|
809.8
|
0.82
|
0.21
|
M-11-126
|
636.0
|
3.0
|
632.0
|
629.0
|
0.81
|
0.22
|
Descriptions
of the five geotechnical holes drilled this year at Mitchell are as follows
(see attached map at http://media3.marketwire.com/docs/seabridge.jpg
for locations):
M-11-122
- Collared on the northeast side of the Mitchell zone and drilled vertically to
a depth of 636 meters, ultimately ending with an azimuth of 162.3° and dip
of -80.2°. The hole intersected massive andesitic flows and tuffs from 3
meters to the end of the hole, except for the interval from 254 to 298 meters
which cut a porphyritic intrusion of similar
composition. All rocks are pervasively altered and veined, with fine
disseminated chalcopyrite from top to bottom. A phyllic
(quartz-sericite-clay-pyrite) alteration assemblage
dominates to a depth of 198 meters, then a mixed zone where phyllic
assemblages are superimposed on earlier chloritic
assemblages (quartz-chlorite-pyrite) down to 394 meters. An intensely veined
zone with up to 40% by volume quartz-sulfide veinlets
occurs from 394 to 474 meters. Chlorite alteration is dominant from this point
to the end of the hole. The highest copper and gold grades are coincident with
chlorite alteration and intensely veined zones. The geology and grade
distribution match well with the existing models. The hole contained average
grade mineralization while still in the central Mitchell zone, at the draw
point level of the preliminary block cave design provided by Golder Associates, grades dropped to below average. Most of
the blocks within the influence of this hole are already in the indicated
category.
M-11-123
- Collared in the central area of the Mitchell zone and drilled at an azimuth
of 225° and dip of -70°. The hole entered bedrock at the collar and
intersected massive andesitic tuffs and flows from top to bottom except for a
barren mafic dyke from 402.4 to 408.1 meters. All
andesitic rocks are pervasively altered and foliated. Chloritic
alteration dominates, but towards the bottom there are remnants of earlier potassic alteration manifested by pink feldspar flooding
around early quartz veins and magnetite. Disseminated chalcopyrite is
ubiquitous and generally correlates with the density of quartz-sulfide stockwork veinlets, which peak at
a volume of about 30% near 150 meters, and very gradually diminish to a volume
of about 5% at the end the hole. The geology and grade distribution match well
with existing models. The hole exited the footwall of the central Mitchell zone
and terminated in below average grade mineralization, at the draw point level
of the preliminary block cave design. This hole will result in upgrading some
currently inferred blocks in the preliminary block cave design to the indicated
category.
M-11-124
- Collared in the central area of the Mitchell zone and drilled at an azimuth
of 135° and dip of -67°. The hole entered bedrock at 3.9 meters and
intersected massive andesitic tuffs and flows to a depth of 674 meters, except
for a barren mafic dyke from 465.2 to 472.2 meters.
From 674 meters to the end of the hole at 687 meters, there is a porphyritic intrusion of andesite
composition. Chlorite alteration dominates throughout except for the interval
from 92.2 to 393 meters where there is overprinting by phyllic
assemblages. Ubiquitous fine disseminated chalcopyrite is generally correlative
with the density of quartz-sulfide stockwork veinlets, which peak at a density of about 40% by volume
near 275 meters, and gradually diminish to about 5% by volume at the end of the
hole. The geology and grade distribution match well with existing models. The
hole exited the footwall of the central Mitchell zone and terminated in below
average grade mineralization, at the draw point level of the preliminary block
cave design. This hole will result in upgrading some currently inferred blocks
in the preliminary block cave design to indicated
blocks.
M-11-125
- Collared on the east side of the Mitchell zone and drilled at an azimuth of
270° and dip of -70°. The hole collared on bedrock and intersected
strongly foliated and altered rocks interpreted to be andesite
volcanic rocks to the end of the hole at 810 meters. Mixed phyllic
and chloritic dominant alteration occurs to 631
meters, then chlorite with magnetite alteration
gradually diminishes to the end of the hole. Quartz-sulfide stockwork
veinlets and associated fine disseminated
chalcopyrite are ubiquitous throughout the entire hole. Quartz veinlets gradually increase in volume from 5% to 10% at
399.4 meters, then sharply increase to about 50% and gradually diminish to less
than 5% at the hole bottom. The geology and grade
distribution match well with existing models. The hole exited the footwall of
the central Mitchell zone and terminated in below average grade mineralization, at the draw point level of the preliminary
block cave design. This hole will result in upgrading to indicated
some currently inferred blocks in the preliminary block cave design.
M-11-126
- Collared in the central area of the Mitchell zone and drilled at an azimuth
of 90° and dip of -70°. The hole entered bedrock at 3 meters, and
intersected massive andesite volcanic rocks for the
entire hole except the interval from 289 to 338 meters, which is a andesite porphyritic
intrusion. Alteration in the andesite is mixed
chlorite and phyllic dominant to the intrusion, and
chlorite dominant from there until the end of the hole. The intrusion is
characterized by pink potassic feldspar flooding
around early quartz veinlets and magnetite. Quartz-sulfide
stockwork veinlets and
associated fine disseminated chalcopyrite are ubiquitous throughout the entire
hole. Native gold filling minute dendritic fractures
over a 1 cm wide patch was observed in a quartz-sulfide breccia
vein from 22.8 to 23.4 meters. Quartz veinlets
gradually increase in volume from about 7% to 20% around 150 meters, then
slowly decrease to under 10% at 450 meters, increasing again to the hole
bottom. The geology and grade distribution match well with existing models. The
hole terminated in average grade mineralization while still in the central
Mitchell zone, at the draw point level of the preliminary block cave design.
This hole will result in upgrading some currently inferred blocks in the
preliminary block cave design to the indicated category.
The
above reported drill holes were designed to intersect the Mitchell deposit at
oblique angles to the true thickness. The true thickness of the Mitchell
deposit ranges from 700 to 800 meters in the area tested by these holes.
KSM
is one of the world's largest undeveloped gold/copper projects. Proven and
probable reserves for the KSM project are as follows (see news release dated
May 2, 2011 for details):
KSM
Proven and Probable Reserves
|
|
|
|
Average Grades
|
Contained Metal
|
Zone
|
Reserve Category
|
Tonnes (millions)
|
Gold
(gpt)
|
Copper
(%)
|
Silver
(gpt)
|
Molybdenum
(ppm)
|
Gold
(million
ounces)
|
Copper
(million
pounds)
|
Silver
(million
ounces)
|
Moly
(million
pounds)
|
Mitchell
|
Proven
|
617.9
|
0.64
|
0.17
|
3.06
|
60.2
|
12.6
|
2,279
|
61
|
82
|
Probable
|
848.6
|
0.59
|
0.16
|
3.02
|
61.8
|
16.0
|
3,040
|
82
|
116
|
Total
|
1,466.5
|
0.61
|
0.16
|
3.04
|
61.2
|
28.7
|
5,320
|
143
|
198
|
Iron Cap
|
Probable
|
334.1
|
0.42
|
0.20
|
5.46
|
48.4
|
4.5
|
1,490
|
59
|
36
|
Sulphurets
|
Probable
|
179.1
|
0.62
|
0.26
|
0.61
|
59.8
|
3.6
|
1,021
|
4
|
24
|
Kerr
|
Probable
|
212.7
|
0.25
|
0.46
|
1.28
|
Nil
|
1.7
|
2,155
|
9
|
Nil
|
Totals
|
Proven
|
617.9
|
0.64
|
0.17
|
3.06
|
60.2
|
12.6
|
2,279
|
61
|
82
|
Probable
|
1,574.5
|
0.51
|
0.22
|
3.03
|
50.4
|
25.8
|
7,706
|
153
|
175
|
Total
|
2,192.4
|
0.55
|
0.21
|
3.04
|
53.2
|
38.5
|
9,985
|
214
|
257
|
National Instrument 43-101 Disclosure
Exploration
activities at KSM are being conducted by Seabridge
personnel under the supervision of William E. Threlkeld,
Senior Vice President of Seabridge and a Qualified
Person as defined by National Instrument 43-101. Mr. Threlkeld
has reviewed and approved this news release. An ongoing and rigorous quality
control/quality assurance protocol is being employed during the 2011 program
including blank and reference standards in every batch of assays. Cross-check
analyses are being conducted at a second external laboratory on 10% of the
samples. Samples are being assayed at Eco Tech Laboratory Ltd., Kamloops, B.C.,
using fire assay atomic adsorption methods for gold and ICP methods for other
elements.
Seabridge holds a 100% interest
in several North American gold 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's mineral reserves and resources by project
and category please visit the Company's website at http://www.seabridgegold.net/resources.php.
All
reserve and resource estimates reported by the Corporation were 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. 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 amount of mineral reserves and
mineral resources; (ii) any potential for the increase of mineral reserves and
mineral resources or improvements in their grade, whether in existing zones or
new zones; (iii) the amount of future production; (iv) further optimization of
the PFS including capacity expansion or underground mining scenarios; (v)
completion of, and submission of, the Environmental Assessment Application; and
(vi) potential for engineering and environmental improvements. Any statements
that express or involve discussions with respect to predictions, expectations,
beliefs, plans, projections, objectives, assumptions 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. These assumptions include: (i) the presence of and continuity of metals at the Project
at modeled grades; (ii) the capacities of various machinery and equipment;
(iii) the availability of personnel, machinery and equipment at estimated
prices; (iv) exchange rates; (v) metals sales prices; (vi) appropriate discount
rates; (vii) tax rates and royalty rates applicable to the proposed mining
operation; (viii) financing structure and costs; (ix) anticipated mining losses
and dilution; (x) metallurgical performance; (xi) reasonable contingency
requirements; (xii) success in realizing further optimizations and potential in
exploration programs and proposed operations; (xiii) receipt of regulatory
approvals on acceptable terms, including the necessary right of way for the
proposed tunnels; and (xiv) the negotiation of satisfactory terms with impacted
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, but specifically
include, without limitation: risks relating to variations in the mineral
content within the material identified as mineral reserves or mineral resources
from that predicted; variations in rates of recovery and extraction;
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; 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, 2010 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.