RE:FROM SEA'S Q1 REPORT RE: MTTcskhurasu wrote: Application for permits to construct the balance of the MTT
The design of the KSM Project as approved in our Environmental Assessment Certificate includes the MTT complex, two 23 km long parallel tunnels that connect the mine sites to the milling area located near an environmentally suitable valley for tailings disposal. Approximately 12.5 km of the MTT route passes through 11 mineral exploration claims held by Tudor Gold Corp (“Tudor”). We have therefore taken care to obtain the priority rights to occupy and use the provincially owned lands through which the MTT must pass, including the Tudor mineral exploration claims.
KSMCo (a 100% owned subsidiary of Seabridge) currently holds a number of permits required for the MTT including a Mines Act permit M-245 (“M-245”) covering a portion of the MTT construction; a License of Occupation (LoO) for the proposed MTT route, and a Conditional Registration Reserve (“CRR”) granted by the Provincial Gold Commissioner. These authorizations were granted by the appropriate government agencies in 2014. As we have advised in our ongoing disclosures, Tudor has contested our MTT rights and made an application to the province to cancel M-245 and the LoO on the arguments that the BC government did not legally have the power to grant these rights to us and that the rights granted to us have caused irreparable damage to the value of their claims. These arguments were refuted by the BC government. On November 17, 2023, the BC Ministry of Water, Land, and Resource Stewardship (WLRS) stated that the province has the legal authority to grant the LoO, that their records show the LoO is in good standing and there is no justification for canceling it under the empowering statute or relevant LoO provisions.
The British Columbia Ministry of Energy, Mines and Low Carbon Innovation (EMLI) reissued their original letter responding to Tudor’s application and in their reissued letter dated February 28, 2024 stated that “a Conditional Registration Reserve (CRR) was established by the Chief Gold Commissioner, for the MTT area, in 2012, and the CRR prohibits the obstruction, endangerment, or interference, with the construction, operation, and maintenance of the tunnel works by any free miner, including Tudor”.
The LoO provides KSMCo the right to occupy the area in which it intends to construct the MTT. Once the MTT is constructed, the License will be converted into a statutory right of way for the entire length of the MTT, including the 12.5 km of the MTT that passes through mineral claims owned by Tudor. In the normal course, our existing LoO expires on September 27, 2024. KSMCo has updated the associated management plan and submitted an application for renewal of the LoO at the request of the applicable regulatory authority.
An amendment application for M-245 requesting permission to construct the remainder of the MTT not already permitted was submitted to the British Columbia Ministry of Energy, Mines and Low Carbon Innovation (EMLI) on April 2, 2024. In support of the amended application for M-245, KSMCo has completed 50 holes totaling approximately 34,000 meters of geotechnical drilling and detailed engineering along the entire MTT route including Tudor’s mineral claims.
Some uncharacteristically straightforward and accurate statements from SEA in the Q1 Report, along with the usual spin (see bold print). The LoO must be renewed; the M-245 only covers a portion of the MTT route; they have drilled 50 holes/34,000m of geotechnical drilling; the amendment M-245 application for the remainder of the MTT was submitted on April 2 2024. Not sure how long it will take to approve an amended M-245 that was just submitted in early April?
Let me make the most positive assumptions I can come up with on this. We were aware of 40 geotechnical holes that were to be drilled. I will assume the other ten were all done on Tudor claims, since why would Seabridge do more than promised on land they already own?
Each of the 50 holes were, on average, about 680m in length. If any were within the Goldstorm area, they could have contacted the 300H Domain or even some of the others. Tudor was required to turn over core from these holes to Tudor. For about the tenth time on this board I am asking if anyone knows whether this happened or the results of the Tudor assays/reviews of this core.
The existing M-245 covers portals and 100m of tunnel (out of 12.5 km on Tudor land). So more than 12km of the MTT on Tudor claims was never authorized by the existing M-245.
Based on this I am putting forward the following positive scenario:
1 - SEA will not be able to sign a JV partner until there is an amicable agreement with Tudor on a final MTT route.
2 - Discussions are in progress to finalize the route and the MTT deal
3 - In return for a reliable, finalized MTT route, SEA will provide a payment to Tudor. All legal actions will be terminated. No future legal actions will be initiated.
4 - The MTT payment will eliminate the need for Tudor to raise any additional money this year for exploration of the TC and production of a PEA.
5 - The discussions will conclude prior to the expiration of the LoO.
6 - The LoO renewal and the complete M-245 will be approved by all parties and government agencies.
7 - SEA will have a JV partner this year for KSM
8 - SEA stock price will appreciate based on the JV agreement
9 - The three Amigos stock prices will appreciate proportionately to the KSM JV agreement which will set the market price for gold in the ground in the region.
10 - TUO's stock price will appreciate also based on the market price for its Treaty Creek NSR's.
- The .98% Goldstorm NSR market price will be set by the value of KSM minerals to be retained by stockholders of SEA
- TUO will purchase 1% of the remainder of TC NSR from St. Andrew Goldfields for the agreed $1 million
- The remaining .5% of the St. Andrew Goldfields NSR will be purchased by one of the stakeholders in the deal.
- TUO stock price will appreciate further based on the market price set by the purchase of the St Andrew Goldfields NSR.
11 - If TUO retains its NSR's on TC it will spin out all of its NSR's into a Teuton Royalties Subsidiary, or retain them within TUO (Teuton becomes a royalty company in that event) and spin out the remaining Teuton properties to the north except for TC which will need to be independent for an easier sale process.
12 - Teuton South properties currently being spun out will combine with Goliath. Crescat Capital joins Mr. Sprott as a major shareholder of the combined company.
13 - Teuton north becomes the prospect generator.
14 - Teuton north combines with all of the Crown properties.
15 - Mr. Sprott therefore has significant stakes in the TC JV, the Royalty Company, the prospect generator companies, Goliath, and SEA via the streaming agreements present and future.
16 - Dino and KK take on significant management or advisory roles going forward.
As always, open to input on any of these or other scenarios.
As for the bold print, let me fix it:
“a Conditional Registration Reserve (CRR) was established by the Chief Gold Commissioner, for the MTT area, in 2012, and the CRR prohibits the obstruction, endangerment, or interference, with the construction, operation, and maintenance of the tunnel works, 12km of which have not yet been approved via the M-245, and assuming there is a timely renewal of the LoO."
Do your own DD. GLTA.