Seabridge nabs Red Mountain project

Vancouver — In keeping with its strategy of acquiring advanced gold projects, Seabridge Resources (SEA-V) has inked a deal with North American Metals (NAM-V) to pick up the Red Mountain project in northwestern British Columbia.

Situated 19 km east of Stewart, the property hosts a measured resource of 1.3 million tonnes grading 8 grams gold per tonne, as well as an inferred resource of 340,000 tonnes averaging 7 grams gold. The overall resource is pegged at 12 million tonnes grading 2.54 grams gold — an estimate based on 127,000 metres of drilling and 2,000 metres of underground workings, including a 1-km-long decline completed by now-defunct Royal Oak Mines and previous operators Lac Minerals and Barrick Gold (ABX-T).

The project also has $500,000 worth of mining equipment on site and includes a $1.5-million cash reclamation deposit lodged with the British Columbia Mines Ministry.

“We believe we can realize additional value from the reclamation bond and subsequent sale of the mining equipment,” says Seabridge President Rudi Fronk.

The deposit is characterized by northwesterly plunging mineralization in three southwesterly dipping elliptical zones formed in stratified sediments and an intrusion. Northwesterly plunging folds and brittle faults cut the host rocks and mineralization.

North American Metals, which is 89%-owned by Wheaton River Minerals (WRM-T), acquired the property in 1999 from Royal Oak for $413,360. Seabridge has agreed to acquire it in return for 800,000 shares. The agreement is subject to a series of net smelter return royalty agreements ranging from 2% to 6.5%.