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Corppres Presentation Transcript

  • 1. SEABRIDGE GOLD Corporate Presentation July 2013
  • 2. SEABRIDGE GOLD Forward Looking Statements All reserve and resource estimates reported by the Company 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. Statements relating to the estimated or expected future production and operating results and costs and financial condition of Seabridge, planned work at the Company’s 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. Forward-looking statements also include reference to events or conditions that will, would, may, could or should occur. 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 Company’s 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 Company’s 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 Company’s Annual Information Form filed with SEDAR in Canada (available at www.sedar.com) for the year ended December 31, 2012 and in the Company’s Annual Report Form 40-F filed with the U.S. Securities and Exchange Commission on EDGAR (available at www.sec.gov/edgar.shtml). Forward-looking statements are based on the beliefs, estimates and opinions of the Company’s management or its independent professional consultants on the date the statements are made. 2
  • 3. SEABRIDGE GOLD The Case for Seabridge • 44.7M oz Au • 10B lbs Cu Proven and Probable Reserves • 45.6M shares outstandingLow Share Dilution • $9 enterprise value per ounce of gold reservesLow Valuation • All reserves are located in CanadaLow Political Risk • New discoveries could add significant higher grade reserves to improve project economicsExploration Upside 3
  • 4. SEABRIDGE GOLD Gold Reserves Reserves rank Seabridge among world’s top ten gold companies 4 Source: Company data. Data as of June 26, 2013. Note: Companies shown include North America’s largest gold companies and selected gold project development companies. GoldReserves(Moz) 45M oz - 30 60 90 120 150 Barrick Newmont Polyus Newcrest Anglogold Goldcorp Kinross Seabridge Yamana NovaGold Agnico-Eagle Detour AlliedNevada Gabriel Osisko Polymetal Buenaventura NewGold AuRico Alamos 45M oz
  • 5. SEABRIDGE GOLD - 0.20 0.40 0.60 0.80 1.00 1.20 Seabridge Newmont Anglogold Barrick Detour AlliedNevada Newcrest Agnico-Eagle Goldcorp NovaGold Kinross Buenaventura Yamana Polyus Gabriel Polymetal AuRico Osisko Alamos NewGold Low Share Dilution 5 Seabridge ranks 1st in reserves per share among leading gold companies Source: Bloomberg, Company data. Data as of June 26th, 2013. Note: Companies shown include North America’s largest gold companies and selected gold project development companies. GoldReservesperCommonShare 0.98 oz/share
  • 6. SEABRIDGE GOLD - 10 20 30 40 50 60 70 80 90 - 10 20 30 40 50 60 70 80 90 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 SharesOutstanding(Millions) OuncesofGold(Millions) Low Share Dilution (cont.) 6 Proven & Probable Gold Reserves Measured & Indicated Gold Resources Inferred Gold Resources Common Shares Outstanding Resources have grown more than ten times faster than shares outstanding Source: Company data. Data as of June 26th, 2013. Note: For a breakdown of Seabridge’s mineral reserves and resources by project, tonnes and grade, please visit http://seabridgegold.net/resources.php
  • 7. SEABRIDGE GOLD EnterpriseValueperReserveozAttractive Valuation 7 Seabridge has a very low enterprise value per ounce of gold reserves Source: Company data. Data as of June 26th, 2013. Note: Companies shown include North America’s largest gold companies and selected gold project development companies (1) Enterprise Value calculated as market capitalization (basic) plus net debt and minority interest - $100 $200 $300 $400 $500 Polymetal Buenaventura Alamos NewGold Yamana Goldcorp Agnico-Eagle Newmont Barrick AuRico Osisko Newcrest Anglogold Polyus Kinross Detour Gabriel NovaGold AlliedNevada Seabridge $8/oz
  • 8. SEABRIDGE GOLD Low Political Risk • Illegal strikes and local opposition delay approved projects (Conga, Santa Anna, Tintaya)Peru • Open pit mining and use of cyanide banned in certain areas • 100% tax on export earnings for some resource projects (Famatina, San Jose)Argentina • Increased taxes and royalties (Fruta del Norte)Ecuador • Creeping expropriation through imposed local and government ownership (Batu Hiju, Grassberg, Tujuh Bukit)Indonesia • Increased royalty structure and challenging power supply issues (all projects) • Local opposition delays approved projects (El Morro)Chile • Stable regulatory and tax regimeCanada 8 Where would you rather be?
  • 9. SEABRIDGE GOLD $15M $9M Exploration Potential 9 The best holes ever drilled at KSM and Courageous Lake were new discoveries in 2012 • Defining a resource at Deep Kerr • Testing for other potential “game changing” core zones KSM • Defining an initial resource at Walsh Lake, where 2012 drilling identified a new deposit with grades that are expected to be significantly higher than existing reserves Courageous Lake 2013 Budget $24M
  • 10. SEABRIDGE GOLD Kerr, Sulphurets and Mitchell • Kerr, Sulphurets and Mitchell (“KSM”), is the world’s largest undeveloped gold/copper project (by reserves) – KSM reserves at 38.2M oz Au and 10B lbs Cu • Located in “mining friendly” British Columbia near past producers • Highly favorable logistics – Access to inexpensive hydro power – Nearby highway network and year-round operating seaport facility • Estimated cash costs well below current industry averages – Operating costs of $141/oz Au – Total costs of $598/oz Au – Less than $0.06/kwh to plug-into hydro power located less than 30 km away • Base Case exhibits outstanding capital efficiency – 50+ year mine life – Payback of 6 years 10
  • 11. SEABRIDGE GOLD KSM is World Class! 11 KSM is a World Class Gold-Copper Project Source: Company data. - 2 4 6 8 10 12 - 10 20 30 40 KSM Donlin PuebloViejo CerroCasale Boddington Caspiche Pascua-Lama Penasquito Conga Telfer ElMorro AguaRica GaloreCreek CuReserves(Blbs) AuReserves(Moz) - 2 4 6 8 10 12 - 10 20 30 40 KSM Donlin PuebloViejo CerroCasale Boddington Caspiche Pascua-Lama Penasquito Conga Telfer ElMorro AguaRica GaloreCreek CuReserves(Blbs) AuReserves(Moz) Au Reserves Cu Reserves - 2 4 6 8 10 12 - 10 20 30 40 KSM Donlin PuebloViejo CerroCasale Boddington Caspiche Pascua-Lama Penasquito Conga Telfer ElMorro AguaRica GaloreCreek CuReserves(Blbs) AuReserves(Moz) Au Reserves Cu Reserves - 2 4 6 8 10 12 - 0 0 0 0 KSM Donlin PuebloViejo CerroCasale Boddington Caspiche Pascua-Lama Penasquito Conga Telfer ElMorro AguaRica GaloreCreek CuReserves(Blbs) Au Reserves Cu Reserves - 2 4 6 8 10 12 - 10 20 30 40 KSM Donlin PuebloViejo CerroCasale Boddington Caspiche Pascua-Lama Penasquito Conga Telfer ElMorro AguaRica GaloreCreek CuReserves(Blbs) AuReserves(Moz) Au Reserves Cu Reserves
  • 12. SEABRIDGE GOLD KSM – Mitchell Zone 12
  • 13. SEABRIDGE GOLD KSM – Favorable Logistics 13
  • 14. SEABRIDGE GOLD KSM – Project Layout 14
  • 15. SEABRIDGE GOLD KSM – Preliminary Feasibility Study 15 The PFS projects a large, long-life mine Unit Years 1-7 LOM 55-Year Plan Average Grades: Gold gpt 0.79 0.55 Copper % 0.23 0.21 Silver gpt 2.39 2.74 Molybdenum ppm 46.2 44.8 Average Annual Production: Gold oz 851,000 508,000 Copper M lbs 195 147 Silver M oz 2.1 2.2 Molybdenum M lbs 1.3 1.1
  • 16. SEABRIDGE GOLD KSM – PFS Pre-Tax Summary 16 50+ year mine plan Case Unit Base Alternate Recent Spot Initial Capital Cost $M $5,300 $5,300 $5,300 Net Cash Flow $M $20,500 $16,800 $31,200 NPV @ 5% $M $4,500 $3,500 $7,700 Internal Rate of Return % 11.5% 10.4% 14.7% Payback Period years 6.2 6.7 5.2 Operating Costs (LOM) $/oz Au $141 $263 $60 Total Costs (includes all capital) $/oz Au $598 $720 $535 Metal Prices: Gold $/oz $1,330 $1,320 $1,650 Copper $/lb $3.45 $3.00 $3.75 Silver $/oz $25.20 $25.60 $32.00 Molybdenum $/lb $15.00 $15.00 $15.00 US$/Cdn$ Exchange Rate - 0.96x 0.96x 1.00x Note: For Operating and Total Costs, copper, silver and molybdenum revenues are taken as a by-product credits.
  • 17. SEABRIDGE GOLD KSM – EA Review Timeline 17
  • 18. SEABRIDGE GOLD Stage I: Formation of Multiple Ore Deposits 18
  • 19. SEABRIDGE GOLD Stage II: Compression, Thrust, Faulting, erosion 19
  • 20. SEABRIDGE GOLD Stage III: Extension, Normal Faulting, Erosion 20
  • 21. SEABRIDGE GOLD 21
  • 22. SEABRIDGE GOLD 22
  • 23. SEABRIDGE GOLD Courageous Lake • At 6.5M oz, Courageous Lake (“CL”) is Canada’s 2nd largest undeveloped gold reserve (KSM is 1st) • Excellent open pit grade of 2.2 gpt Au – More than twice the grade of Osisko and Detour Gold’s new mines • Recently completed Preliminary Feasibility Study shows viable project with exceptional leverage to higher gold prices • Wholly owned 53 km greenstone belt provides excellent exploration potential • Located in Northwest Territories within 100 km of Diavik and Ekati, two large operating open pit diamond mines 23
  • 24. SEABRIDGE GOLD Courageous Lake – Project Location • Project located on winter ice road, in close proximity to the Diavik and Ekati mines – Demonstrating that year round open pit bulk tonnage operations are feasible • Nearby mines provide “real-time” estimates for capital and operating costs – Additionally, with mines scheduled to close over the next several years, a local and trained workforce will be readily available 24
  • 25. SEABRIDGE GOLD Courageous Lake – Exploration Potential • Existing 6.5M oz reserve covers only 2 km of an under explored greenstone belt that stretches 53 km – Owned 100% by Seabridge • Two former producing mines on belt (Salmita and Tundra) had average grades of ~1 opt Au (30 gpt) • Seabridge now exploring for additional deposits that could extend the estimated 15 year mine life – With potentially higher grades mined in early years 25
  • 26. SEABRIDGE GOLD Courageous Lake – 2012 PFS (July 2012) 26 Exceptional leverage to gold price Case Unit Base Alternate Gold Price $/oz $1,384 $1,925 Initial Capital Cost $M $1,520 $1,520 Mine Life years 15.0 15.0 Average Annual Gold Production ounces 385,000 385,000 Net Cash Flow $M $1,507 $4,519 NPV @ 5% $M $303 $2,080 Internal Rate of Return % 7.3% 18.7% Payback Period years 11.2 4.0 Operating Costs (years 1-5) $/oz Au $674 $689 Operating Costs (LOM) $/oz Au $780 $796 Total Costs (includes all capital) $/oz Au $1,123 $1,141 US$/Cdn$ Exchange Rate - 0.98x 0.99x
  • 27. SEABRIDGE GOLD CL – Value Enhancing Opportunities • Access to hydro-electric generated power • Examine year round road access opportunities Improve Capital and Operating Costs • Exploring for higher grade material that could be exploited in the early years of production • History of high grade production along belt Higher Grades • Exploring for additional bulk mineable deposits that could extend project life beyond the current 15 year estimate Additional Deposits 27
  • 28. SEABRIDGE GOLD 28
  • 29. SEABRIDGE GOLD Catalysts for Success 29 EA/EIS Approval • Advancing through environmental approval and permitting process • Approval expected mid 2014 Exploration Success • Pursuing exploration opportunities that will improve project economics • $24M committed for exploration drilling and ultimately increase resources Joint Ventures • Projects being de-risked to drive joint venture terms • IBA negotiations proceeding with Treaty and First Nations • Transactions dependent on improved market conditions
  • 30. SEABRIDGE GOLD Corporate Information • NYSE: SA • TSX: SEA • Included in GDX and GDXJ Listings • 45.6M shares outstanding • 48.0M fully dilutedShare Structure • No debt • More than C$30M in cashBalance Sheet • Interests are aligned with shareholders • Insiders own over 30% of common sharesManagement and Board • Own ~35% of common shares • Investors include Friedberg Mercantile, Royce, Van Eck, BristolFinancial Institutions • Royal Gold (recently increased KSM royalty option)Strategic Investors 30
  • 31. SEABRIDGE GOLD Experienced Management 31 • Has over 30 years experience in the gold business, primarily as a senior officer and director of publicly traded companies including Greenstone Resources, Columbia Resources, Behre Dolbear & Company, Riverside Associates, Phibro-Salomon, Amax, and DRX Rudi Fronk Co-Founder, Chairman & CEO • Over 30 years of experience in the mining sector and is responsible for designing and managing the technical programs required to advance Seabridge's two main assets towards feasibility • Former Vice President of Solutions and Innovation for Newmont Mining Company Jay Layman Director, President & COO • Over 30 years of exploration experience and is responsible for the design and execution of Seabridge’s exploration and resource delineation programs • Previously served as Exploration Manager and Vice President with Placer Dome Bill Threlkeld Senior VP, Exploration • Over 30 years of experience in mine engineering, design, strategic analysis and start-up • Formerly a Group Executive, Mine Engineering at Newmont Mining Corporation Peter Williams Senior VP, Technical Services • Has 20 years of mining industry and public accounting experience and has been a CGA since 1994 • Currently a director of Paramount Gold and Silver Christopher Reynolds VP, CFO • With over 20 years of experience, Mr. Murphy is responsible for developing and managing Seabridge's environmental programs and community engagement strategies Brent Murphy VP, Environmental Affairs • Has practiced law in the areas of corporate finance and securities, corporate and mining since 1993 and has been counsel to Seabridge Gold since 1999 Bruce Scott VP, Corporate Affairs
  • 32. SEABRIDGE GOLD Board of Directors • Founded Seabridge in 1999 and served as Chairman of the Board from 2002-2012 • Former advisor to a number of major corporations and venture capitalists focusing primarily on corporate strategy, and was a policy consultant to several government ministries James Anthony Co-Founder • Founder and Chairman of Mintec, Inc. and one of the original developers of MineSight™, recognized as the pre-eminent reserves modeling and mine design software system with more than 300 installations worldwide Frederick Banfield • Over 45 years of mining related experience, predominately in senior technical project management and operational roles, including Newmont and FreeportScott Barr • Over 40 years of accounting experience including senior audit partner with Deloitte Touche Thomas Dawson Chairman of Audit and Nomination Committees • Over 25 years experience in precious metals trading, merchanting and merchant banking activities including J. Aron & Co,, Goldman Sachs and Gerald MetalsLouis Fox • With over 30 years of experience, Mr. Gonzalez-Urien is one of the most highly regarded exploration geologists in the mining industry. Ran global exploration for Placer Dome from 1989 through 2001Eliseo Gonzalez-Urien 32