Interview With The Director, President And CEO: Seabridge Gold Inc. - Rudi P. Fronk
December 19, 2011 - The Wall Street Transcript has just published Gold and Precious Metals Report offering a timely review of the sector. This Special Report contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. Please find an excerpt below.
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Rudi P. Fronk, Director, President and Chief Executive Officer of Seabridge Gold Inc., has more than 30 years of experience in the gold business, primarily as a Senior Officer and Director of publicly traded companies. Since 1999, Mr. Fronk has served as President and CEO of Seabridge Gold. Before Seabridge, he held senior management positions with Greenstone Resources; Columbia Resources; Behre Dolbear & Company, Inc.; Riverside Associates; Phibro-Salomon Inc.; Amax Inc. and DRX, Inc. Mr. Fronk is a graduate of Columbia University from which he holds a B.S. in mining engineering and an M.S. in mineral economics.
TWST: Please give us a brief history of Seabridge Gold and an overview of its operations.
Mr. Fronk: We formed Seabridge in 1999 with a contrarian view on gold. When everybody else was getting out of the gold business, we thought it was a good time to get in. We believed that over time that the price of gold would go significantly higher. Our goal was to create a unique leveraged play to the price of gold. From 1999 to 2002, we were in acquisition mode. We looked to buy undeveloped gold assets in North America, which needed higher gold prices to be economic and also had exploration upside. During this time, we purchased nine deposits that initially gave us 15 million ounces of gold resources.
We paid 15 million for these projects, whereas previous owners had spent over 300 million to find them. In 2003, acquisitions started to get more expensive as the gold price increased, so we turned to the drill bit to try and grow the deposits we had acquired. As a result of our exploration efforts, our gold resources have now grown fivefold. Seabridge now has 39 million ounces of proven and probable gold reserves and another 16 million ounces of gold in the measured and indicated resource categories. We also have an additional 20 million ounces of gold in the inferred resource category.
Most of this growth has come from our two core projects - KSM in British Columbia and Courageous Lake in the Northwest Territories. We are now advancing both KSM and Courageous Lake through permitting and toward final feasibility. Our expectation is that we will be able to either sell or joint-venture these projects with larger companies that have the technical and financial resources to build and operate large mines.
TWST: What are some of the neighbors around those properties that you mentioned?
Mr. Fronk: At KSM, we have Pretium right next door with two large deposits, Brucejack and Snowfield. There is a longstanding mining history in the immediate area of KSM. Just to the north of KSM is Eskay Creek, a mine that Barrick Gold successfully operated for many years. Just to the south of KSM is Granduc, a mine that Newmont operated for several years. In the case of Courageous Lake, two of Canada's largest diamond mines, Diavik and Ekati, have been successfully operating for more than 10 years as large open-pit projects.
TWST: In a recent statement, the company announced new results regarding an expansion in Zone 8 at Courageous Lake. Would you tell us more about that?
Mr. Fronk: Courageous Lake is a project that we acquired in 2002 from Newmont and Total. When we bought Courageous Lake, there were 5.7 million ounces at Courageous Lake mostly all in the inferred category. We started exploring Courageous Lake in 2003 and continue drilling it today. Last year, we updated the resources where we now report a total resource of 11.3 million ounces, of which 6.8 million ounces are in the measured and indicated categories. Earlier this year, we completed a preliminary economic assessment that showed a very robust project at today's gold prices. This summer, we conducted infill drilling at Courageous Lake in hopes of upgrading in-pit resources to higher categories so they can be defined as reserves in a preliminary feasibility study scheduled for next year. In addition to successfully upgrading these resources, we also encountered additional gold mineralization in Zone 8, a zone that has some of the highest grades. This will allow us to not only upgrade resources, but should also allow us to expand resources and increase the average grade.
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