The Red Mountain Project near Stewart, British Columbia has been the subject of extensive exploration and development activities since 1989.
Seabridge Gold Inc. (“Seabridge”) acquired the Red Mountain Project in February 2002 to provide exceptional returns to shareholders by maximising leverage to the gold price that was expected to rise. Seabridge’s business plan was to find, evaluate, acquire, explore and develop gold deposits. Management decided that Seabridge would not build or operate mines, but would look to partner or sell assets that were ready for production.
In 2003 Seabridge commissioned SRK Toronto to prepare an Independent Engineering Study on the Project.
SRK evaluated previous studies and recommended the best development alternatives for various aspects of the project, including:
- Method of access to the site location in challenging mountainous terrain. Options included road access, aerial tramway, and tunnel and shaft. Road access was selected
- Power supply. Overland BC Hydro power line was selected over on-site diesel generation.
- Operating schedule, considering the mountain location and avalanche hazards. Seasonal operation from May to October was selected over year-round operations for safety and reliability
- Mill location and basic process. An on-site mill using a grinding and cyanidation leaching (CIP) circuit was selected over the alternative of using flotation to produce a sulphide concentrate for offshore marketing
- A conventional type of mill was selected over a portable type, due to the tonnage required (1000tpd) and the very fine grind needed
- The full use of backfill was selected to maximise the mining recovery of the resources. Minimising backfill was considered to reduce costs, but the potential savings did not justify a lower recovery of the mineral resource
- Having selected the optimum development plan for the project, SRK prepared a life-of-mine production plan and cash flow model.
In late 2007, Seabridge commissioned SRK to update the costs and economics of our 2003 Technical Report. Results were reported in an updated Preliminary Economic Assessment in January 2008.
Throughout this period, SRK Vancouver provided ongoing environmental management services to Seabridge, including annual site inspections, water quality monitoring, annual regulatory reporting, and closure planning to ensure the site is in compliance and no outstanding regulatory concerns could delay future development activities.
Seabridge is now seeking a joint venture partner or acquirer for the Red Mountain Project.
