The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Drills test deeper, higher grade zones at world-class copper-gold project
Over the past decade, Seabridge Gold Inc. has outlined 9.9 billion pounds of copper and 38.2 million ounces of gold in reserves at its Kerr-Sulphurets-Mitchell project in northwestern British Columbia. While the gold reserves are the largest for any yet to be developed project on Earth and the copper reserves are themselves of world-class status, Seabridge believes that the results of exploration in 2014 could surpass all previous years of drilling at the project more commonly known as KSM.
"The Seabridge exploration team believes the 2014 program will be our best yet. The excitement level is really palpable as the drilling begins," Seabridge Gold Chairman and CEO Rudi Fronk said at the June start of drilling at KSM.
This confidence in a banner year of exploration rests upon the understanding and discovery of higher grade "core zones" that are looking to increase the size and grades already delineated at this copper-gold mine project.
"We now know a great deal more about the geophysical and geochemical signatures of the higher grade core zones we are looking for, and we also have unraveled the major displacements that have occurred along the district's faults. With these powerful tools at our disposal, we are confident that we will find more core zones this summer," Fronk said.
Expanding Deep Kerr
Deep Kerr, located below the Kerr portion of the KSM deposits, is currently the most tested of the deep zone targets.
Following a 25-hole, 23,802-meter program at Deep Kerr in 2013, Seabridge announced a maiden inferred resource of 515 million metric tons grading 0.53 percent (6.1 billion pounds) copper and 0.36 g/t (5.9 million ounces) gold.
"Deep Kerr has the size and grade of a world-class deposit, and it is very well-situated for low-cost, efficient underground block cave mining. The resource model assumes this method of exploitation and is based on a set of realistic economic assumptions derived from similar deposits now in production. We, therefore, have a high degree of confidence that, with further work, Deep Kerr can mature into an outstanding opportunity for a large, high-margin operation attractive to major mining companies," Fronk commented on the resource reported in February.
Seabridge geologists believe that Deep Kerr is not only ripe for expansion in terms of size but grade as well.
"We think the best is yet to come. Deep Kerr has excellent continuity of grade vertically and laterally within the deposit, which is helpful for mine planning and lower costs, but there is also a strong apparent improvement in thickness and grade to the north, which was the site of the last holes drilled in our 2013 program," Fronk explained.
Eager to add tons of higher grade mineralization to Deep Kerr and test other similar targets at KSM, Seabridge launched a 19,000-meter drill program in June.
One of the priority targets for 2014 is to determine the northern extension of the deposit with step-outs that could extend the strike of Deep Kerr by several hundred meters in that direction.
The company also plans to drill deeper into Deep Kerr, where mineralogical data suggests greater concentrations of copper-rich bornite could be lying in wait.
In addition to expanding the known Deep Kerr, company geologists will seek a twin that could be hiding to the east.
Seabridge is basing its Deep Kerr east theory on the standard model for very large porphyry mineral systems such as Bingham Canyon in Utah, where the core of the source intrusion typically pushes its metal load out to the margins. Variations in pressures and temperatures as fluids moved away from its source results in various mineralization, creating a somewhat symmetrical metallic thumbprint of sorts.
If this model applies to Deep Kerr, Seabridge believes it would mean that the resource drilled to date may only represent half of the mineral thumbprint, leaving open the possibility of an eastern counterpart yet to be found. The company believes such a discovery would be significant, potentially repeating the known Deep Kerr deposit in addition to the expected expansion of the west limb to the north.
Data from the original Kerr deposit in combination with 2011 geophysical surveys that indicate the rocks in the eastern part of the Kerr system have properties similar to the already discovered Deep Kerr zone provides further evidence that an eastern extension of Deep Kerr could exist.
A round of recently completed magnetotelluric surveys, a geophysical technique that measures fluctuations in naturally-occurring electrical and magnetic fields, adds to the growing body of evidence pointing to a second deposit below Kerr.
These magnetotelluric surveys were used to guide the discovery of the original Deep Kerr and could be useful tool for locating the foreseen eastern extension and group of other core zones Seabridge believes to be lurking below the deposits it has already discovered at KSM.
"Our understanding of the KSM system has increased immensely since the discovery of Deep Kerr, and the more we learn, the more upside we see," the Seabridge CEO expounded.
Below the Iron Cap
Aside from Deep Kerr, Seabridge's 2014 search for core zones will focus on higher grade depth extensions of Iron Cap, a deposit with an indicated resource of 361.7 million metric tons averaging 0.44 g/t (5.1 million ounces) gold, 0.21 percent (1.7 billion pounds) copper, 5.4 g/t (62.8 million ounces) silver and 47 ppm (37.5 million pounds) molybdenum.
"A key objective for this year's drilling is to find additional higher grade core zones following last year's major discovery of the Deep Kerr deposit. The potential below Iron Cap was our No. 1 new target because of where it is," explains Fronk. "Iron Cap is currently designed as an underground block cave mine, sitting about 1,000 to 1,200 meters laterally from the access tunnels designed for the KSM project, making it the closest deposit to infrastructure. Seabridge said deeper and higher grade zones of copper and gold would significantly improve the Iron Cap deposit with little change to the KSM project design."
Drilling over the past couple of years has sought a higher grade core zone below Iron Cap. One such hole, IC-13-49, cut 261.4 meters of 0.40 percent copper and 1.09 g/t gold.
Instead of a top-down approach, which did not test the width and strike of the projected core zone, the 2014 drilling is designed to cut across the projected Iron Cap core zone.
Hole IC-14-53 cut 514 meters averaging 0.68 g/t gold, 0.30 percent copper and 5.2 g/t silver; and IC-14-54 cut 510 meters averaging 0.41 g/t gold, 0.28 percent copper and 10.5 g/t silver.
Seabridge said these new holes indicate that the Lower Zone has excellent size and continuity as well as higher grades than the Iron Cap deposit above it.
The mineralization cut in these first two holes below Iron Cap indicate to Seabridge that drilling is closing in on the core zone the company is seeking.
Upon the September release of the first two holes, Seabridge said the drill program is being intensified in order to generate sufficient data for an initial resource estimate expected by January 2015.
Assembling the pieces
As drilling seeks to add new higher grade mineralization, Seabridge Gold is in the final stages of assembling all of the pieces needed to develop a mine at KSM. Attracting a partner of the same world-class caliber as the deposits that make up the project simply known as KSM and getting that final stamp of approval from the federal government are the key outstanding pieces.
In July, the British Columbia Ministers of the Environment and Energy and Mines put its stamp of approval on an environmental assessment certificate for development of a mine at KSM.
"This decision confirms that KSM is a well-designed, environmentally responsible project which is technically feasible and offers significant economic benefits to both British Columbia and Canada," said Fronk. "This decision also affirms the value of extensive public consultation early in the environmental assessment process which helped us to understand the cultural, social, environmental and economic context of the KSM project."
In the wake of a tailings dam failure at Imperial Metals' Mount Polley Mine to the south, however, many in British Columbia and across the border in Alaska are calling for an extra level of scrutiny by way of an independent panel to review before Seabridge is issued the federal permits to develop KSM.
To alleviate concerns over the integrity of existing and future tailings facilities in the province, British Columbia has assembled a panel of engineering experts to investigate the cause of the breached dam at Mt. Polley Mine and is expected to beef up dam regulations based on the panel's findings and recommendations.
The proposed KSM tailings facility, which has already been engineered to standards that exceed regulatory requirements, will get weighed against the new standards set by the province.
The 2.16 billion tons proven and probable reserves averaging 0.55 grams per metric ton (38.2 million ounces) gold, 0.21 percent (9.89 billion pounds) copper, 2.74 g/t (191 million ounces) silver and 44.7 parts per million (213 million pounds) molybdenum, KSM has plenty of ore grade material to support a 130,000 metric ton per day mine at KSM for more than 50 years.
Any additional higher grade gold and copper found in the core zones will add to project that already ranks among the world elite.
The project now awaits a final decision by the Canadian Environmental Assessment Agency.
Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.
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