SEA
Well there you have it...earlier this week UBS quoted NEM as saying: >>Newmont Mining Corp plans to aggressively replace reserves while selling off low-grade assets<<
The question is...what are they going to buy?
What will it do for the Juniors?
I hear that ABX is looking (rumour) at acquiring 3 or 4 producers by year end...if this happens....it's going to get sillier than it has already been :)
Seabridge Resources Inc - News Release
Seabridge aims to buy the Tundra
Seabridge Resources Inc SEA
Shares issued 14,390,699 May 23 2002 close $2.350
Friday May 24 2002 News Release
Mr. Rudi Fronk reports
SEABRIDGE TO ACQUIRE TUNDRA GOLD PROJECT
Seabridge has reached agreement to purchase a 100-per-cent interest in the Tundra gold project from Newmont Canada Limited and Total Resources (Canada) Limited. Closing of the acquisition is subject to technical due diligence satisfactory to Seabridge, execution of a definitive purchase and sale agreement and regulatory approval. To finance the acquisition, Seabridge has arranged a $5.4-million equity private placement financing.
"Our stated goal for 2002 is to bring our total gold resources to more than 10.0 million ounces on terms that increase gold ownership per common share," stated Seabridge president Rudi Fronk. "On closing of the Tundra acquisition and related financing, we will expand our total gold resources by 75 per cent to approximately 14 million ounces while increasing our fully diluted common share base by less than 21 per cent."
The Tundra project comprises 7,363 hectares located approximately 150 kilometres north of Yellowknife, NWT, about halfway between the Giant Con and Lupin gold mines. Gold was first discovered at Tundra in the 1940s. Gold mineralization at Tundra is in the upper part of an assemblage of Archean age felsic pyroclastics, just below a transition zone with volcaniclastic sediments. This geological setting for Tundra is similar to several other large gold deposits hosted in Archean rocks including Hemlo. In addition to Newmont and Total, previous owners and operators of Tundra have included Noranda, Getty, Hemlo Gold and Battle Mountain. In addition, from 1997-1999, Placer Dome optioned the property from Battle Mountain. To date, 427 drill holes totalling 107,415 metres have been drilled at the project.
Concentrating on the potential for an underground mine, in May, 1990, Noranda estimated a total unclassified gold resource, at a cutoff grade of 3.4 grams per tonne, of 29.6 million tonnes at a grade of 6.2 grams of gold per tonne for about six million ounces. Focusing on the open pit potential of the project, Placer Dome drilled 96 diamond drill holes. From this work, at a cutoff grade of 1.5 grams per tonne, in March, 1999, Placer Dome calculated an indicated and inferred gold resource at the project of 69.2 million tonnes grading 2.67 grams of gold per tonne for total gold resources of approximately 5.9 million ounces. As part of its due diligence, Seabridge has commissioned an independent resource study of Tundra to restate the resources in compliance with National Instrument 43-101. Until this study is completed, Seabridge considers the Tundra gold resource to be inferred. "Although Battle Mountain's recent review of Placer Dome's work suggested that a portion of the Tundra resource may be economic at a $300 gold price, our view is that this project requires a higher gold price to make a mine feasible," said Mr. Fronk.
At Closing Seabridge will pay Newmont/Total $2.5-million (U.S.) and a 2.0-per-cent net smelter royalty interest in the project. A further $1.5-million (U.S.) is payable to Newmont/Total when the spot price of gold closes at or above $360 (U.S.) per ounce for 10 consecutive days. A final $1.5-million (U.S.) is payable to Newmont/Total when the spot price of gold closes at or above $400 (U.S.) per ounce or a production decision is made at Tundra, whichever is earlier.
To finance the acquisition of Tundra, Seabridge has negotiated a private placement to issue 3.2 million units at $1.70 per unit for total proceeds of $5.44-million, which is subject to approval of the TSX Venture Exchange. Each unit consists of one common share and one-half of a common share purchase warrant exercisable for one year at $1.90. The shares to be issued under this financing will be subject to a four-month hold period. There are no commissions or finder's fees payable on this financing. In the event that Seabridge elects not to proceed with the Tundra acquisition, this financing will be cancelled without penalty.
"Newmont/Total stipulated that the sale of the Tundra project must be for cash plus a royalty. For this reason, Seabridge had to arrange the financing prior to reaching agreement on the purchase terms. The financing was priced on the basis of last Friday's closing price of $1.64 per share and was renegotiated upward as the company's share price rose in response to a higher gold price and the number of units was reduced. No Seabridge insiders are participating in this private placement," said Mr. Fronk. |
