KSM Project Update Brent Murphy Vice President, Environmental Affairs November 6, 2014
About the KSM Project • Acquired by Seabridge in 2001 • Proposed gold and copper mine • Located 65 km northwest of Stewart, BC • Business strategy: to partner with a major mining company to develop the project • Environmental Assessment process initiated in March 2008, almost complete S EABRIDGE G OLD 2
S EABRIDGE G OLD Source: Company data KSM is World Class KSM is a world class gold-copper project Au Reserves (M oz) 10 20 30 40 - KSM Donlin Pueblo Viejo Cerro Casale Boddington Au Reserves Caspiche rves Pascua-Lama Cu Reserves Penasquito Conga Telfer El Morro Agua Rica Galore Creek - 2 4 6 8 10 12 Cu Reserves (B lbs) 3
KSM Preliminary Feasibility Study PFS (2012) projects a 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 S EABRIDGE G OLD 4
KSM Location S EABRIDGE G OLD 5
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KSM Mitchell Zone S EABRIDGE G OLD 7
KSM Kerr Deposit S EABRIDGE G OLD 8
KSM Sulphurets Deposit S EABRIDGE G OLD 9
KSM Iron Cap Deposit S EABRIDGE G OLD 10
KSM Components • KSM is similar when compared to other porphyry mining projects in North America and the world • Tunnels are similar in design to Granduc tunnel near Smithers, BC • Project location, including division of main work site by several kilometers and connected by tunnels, similar to Los Pelambres in Chile • Mitchel Pit is an average sized open pit, extending 400 metres beneath existing surface S EABRIDGE G OLD 11
Production Rate • KSM Project (proposed): 130,000 tpd • Batu Hijau, Indonesia: 100,000 tpd • Antamina, Peru: 130,000 tpd • Escondida, Chile: 130,000 tpd • Highland Valley Copper, Canada: 133,000 tpd • Bingham Canyon Mine, Utah 150,000 tpd • Los Pelambres, Chile: 170,000 tpd • Chuquicamata, Chile: 182,000 tpd • Grasberg, Indonesia: 240,000 tpd S EABRIDGE G OLD 12
KSM Dams • The KSM tailing dams have been designed by an internationally recognized engineering firm, checked by an independent third party, and further examined by the BC Government regulatory bodies. • The dams are specially designed to withstand floods and earthquakes. A dam of this type recently withstood an 8.8 magnitude earthquake in Chile. • After Mount Polley, and without prompting from government, KSM initiated a review by a panel of independent engineers to further establish the safety of the tailing dam design. • The water storage dam on upper Mitchell Creek is designed to hold mine contact water prior to treatment and discharge and is not a tailings dam. S EABRIDGE G OLD 13
KSM Environmental Assessment S EABRIDGE G OLD 14
Environmental Assessment: Key Dates • March 2008 : Entered BC Environmental Assessment; process/working group meetings begin • July 2009: Entered Federal Comprehensive Study process • February 7, 2013: Submitted EA/EIS Application to BC EAO and CEAA • August 12, 2013: EA/EIS Application accepted into the official review period • July 21, 2014: Comprehensive Study Report is published and 30 day public comment period begins • July 30, 2014: Received approval from Province of BC • August 20, 2014 : Comment period closes and CSR is referred to Federal Minister S EABRIDGE G OLD 15
Environmental Assessment: CAN/US S EABRIDGE G OLD 16
What did we study? 60 valued components under 13 headings Water Terrain and soils 1. 8. Fish and aquatic Vegetation 2. 9. habitat 10. Air quality and climate Wetlands change 3. Wildlife 11. Visual and aesthetic 4. resources Human health 5. 12. Noise Heritage 6. 13. Land use Social 7. S EABRIDGE G OLD 17
Protecting Fish and Aquatic Life • Guiding Design Principle: protection of the environment including downstream waters and fish-bearing habitats • Extensive environmental and technical evaluations by independent experts over seven years S EABRIDGE G OLD 18
Protecting the Water • Water quality is naturally poor due to acid rock drainage and glacier melt • Potentially acid generating tailings material will be stored in a lined facility and isolated • Water quality predictions indicate improved water quality in the Unuk River for many total metals • Selenium concentrations will not exceed baseline concentrations and will continue to meet BC Water Quality Guidelines at the BC-Alaska border S EABRIDGE G OLD 19
Water Quality Guidelines: BC and Alaska Aquatic Life for Fresh Water Aquatic Life for Marine Water Substance Drinking Water Chronic Chronic Alaska BC Alaska BC Alaska BC Arsenic 10µg/l 25µg/l 150µg/l 5µg/l 36µg/l 12.5µg/l Copper --- 500µg/l Depends on hardness of water 4.8µg/l 2µg/l 200µg/l 200µg/l (SAD CN Cyanide 5.2µg/l (free CN) 5µg/l (WAD CN) 1µg/l (free CN) 1µg/l (WAD CN) free CN plus thiocyanate) 0.20µg/l 0.02µg/l Mercury 2µg/l 1µg/l 0.77µg/l dependent on 0.94µg/l dependent on concentration of MeHg concentration of MeHg Selenium 50µg/l 10µg/l 5µg/l 2µg/l 71µg/l 2µg/l There are differences in the way Alaska/EPA and BC calculate concentrations. Therefore, this table represents a best effort to directly compare the standards of the two distinct jurisdictions. S EABRIDGE G OLD 20
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Mitchell Creek McTagg Creek S EABRIDGE G OLD 22
Gingras Creek Sulphurets Creek Mitchell Creek S EABRIDGE G OLD 23
Unuk Sulphurets Creek River S EABRIDGE G OLD 24
What is Social License? • “Social license” generally refers to a local community’s acceptance or approval of a company’s project or ongoing presence in an area. • The development of social license occurs outside of formal permitting or regulatory processes, and requires sustained investment by proponents to acquire and maintain social capital within the context of trust-based relationships. • Social license can be realized through a robust suite of actions centered on timely and effective communication, meaningful dialogue, and ethical and responsible behavior. ~Brian F. Yates and Celesa L. Horvath, Social License to Operate: How to Get It, and How to Keep It . 2013 Summit Working Papers. S EABRIDGE G OLD 25
Regulatory Approval CEAA Comprehensive Study Report: “The Agency concludes that the project is not likely to cause significant adverse environmental effects, taking into account the implementation of mitigation measures described in this comprehensive study report .” “The agency is satisfied that identified mitigation measures for the project would address potential impacts in Alaska on fish; recreational and commercial fisheries and human health from changes to water quality and quantity in the Unuk River.” BC Government Press Release: “The ministers have issued the certificate with legally -enforceable conditions that have given them the confidence to conclude that the project will be constructed, operated and decommissioned in a way that ensures that no significant adverse effects are likely to occur .” Representative from Alaska Department of Natural Resources: “Four of the same resource managers and specialists who review Alaskan mines have examined KSM’s plan. They found no significant issues with the applications.” – Juneau Empire, April 11 th , 2014 S EABRIDGE G OLD 26
Social License: Treaty and First Nations • Entered into a Benefits Agreement with the Nisg a’a Nation including their support of the Project – June 2014 • Signed agreement with Gitanyow Nation – June 2014 • Gitxsan First Nation sent letter of support (July 2013): “…we have found them to be open, honest and transparent. It is clear to us Seabridge is committed to the community, to First Nations and to Gitxsan people.” • Discussions with remaining Nations have been initiated • Funded the participation of Treaty and • First Nations within the environmental assessment review process S EABRIDGE G OLD 27
Social License: Communities • Received support letters from the City of Smithers (September 2013) and the City of Terrace (October 2013) • Seabridge invests in skills development. $100,000 each to: AMTA to fund delivery of an essential skills upgrading program in three northwest Aboriginal communities (January 2012) Northwest Community College for a mobile trades training unit (January 2013) Northwest Community College for their Intro to Trades 10 program (January 2014) S EABRIDGE G OLD 28
Engagement in Alaska Note: Seabridge has funded the State of Alaska’s involvement in the KSM environmental assessment review process S EABRIDGE G OLD 29
Engagement in Alaska S EABRIDGE G OLD 30
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