Seabridge Gold today announced the final results from an extraordinary exploration drilling season on the recently-discovered Deep Kerr core zone at its 100%-owned KSM Project in north western British Columbia, Canada. A core zone discovery at Deep Kerr was the primary objective of this year's exploration program and results far exceeded expectations. A total of 23,802 meters were drilled on the Deep Kerr target between June and October of this year. Results are being integrated into a Deep Kerr geological model for a resource estimation expected in January 2014.
During the 2013 program, 29 diamond drill holes were attempted, 25 holes were completed through the Deep Kerr target, two were lost due to significant hole deviation (K-13-27 and K-13-33) and two were terminated due to weather and are available for re-entry in the future ( K-13-25D and K-13-28C). Of the 25 holes completed, 23 encountered significant gold and copper grades over extensive widths. The weighted average of the drill intercepts from the Deep Kerr zone yields a grade of 0.46 g/T gold and 0.71% copper over a width of 220 meters. These results represent a substantial increase in copper grades over previous drilling at KSM and are expected to generate a resource which significantly exceeds the average grade at KSM. However, until the estimation work is completed by an independent Qualified Person, there can be no assurance that Deep Kerr's drill results will support a planned NI 43-101-compliant resource estimate or what the grade of such a resource is likely to be.
Significance of Deep Kerr
Seabridge believes that the Deep Kerr discovery dramatically changes the economic profile of KSM. A year ago, KSM was an attractive large-scale gold project with a robust copper credit. With the addition of Deep Kerr, we believe KSM is now equally a top-tier copper project with grades that potentially invite comparison with the world's largest and most profitable operating copper-gold mines such as Grasberg (Freeport McMoran), Batu Hijau (Newmont) and Bingham Canyon (Rio Tinto).
Seabridge Chairman and CEO Rudi Fronk noted that "a key strategic objective for this year's program was to expand the universe of prospective operating partners for KSM by increasing its potential as a copper producer. There are not many gold companies able to build a project as large as KSM. There are many more base metal producers with the capacity and experience needed for the task. We believe that Deep Kerr now puts KSM's copper potential above the threshold required for the involvement of a major base metal company. Our current focus is to continue to de-risk KSM, particularly by advancing it through the environmental review process and reaching agreements with local Treaty and First Nations. When these objectives have been met, which we anticipate by mid next year, we expect a longer list of prospective operating partners thanks to our success at Deep Kerr."
Fronk also noted that the spectacular widths and grades encountered in hole K 13-34 (640 meters of 0.85% copper and 0.42 g/T gold) indicate that the most productive portion of Deep Kerr could be found in future drilling. "Our best results came at the end of this year's program. As we moved to the north, there was a definite trend towards a broader zone with richer gold and copper grades. Next year's program will focus on this area, which is open along strike and at depth and where higher grade tonnage could be added quickly. There is no doubt in our mind that Deep Kerr will prove to be a very large deposit. With a known strike of 1600 meters, a known depth of 700 meters and a target that is wide open to the north and at depth, we see billion tonne potential in front of us."
All holes were drilled perpendicular to the strike of the Deep Kerr zone and were intended to intersect the true width of the body. We believe these intersections likely approximate true width. A three-dimensional model now being constructed will help to confirm this interpretation.