Issue link: http://resourceworld.uberflip.com/i/392638
o c t o b e r / n o v e m b e r 2 0 1 4 www.resourceworld.com 21 SeabRidge goLd'S KSM PRojeCt ReCeiveS eiS aPPRovaL Seabridge Gold Inc. [SEA-TSX] reports the British Columbia Environmental Assessment Office (BCEAO) has advised Seabridge that its Application for an Environmental Assessment Certificate for its KSM Project near Stewart, British Columbia has received final approval from the BC Ministers of the Environment and Energy and Mines. The Ministers, in their decision, have concluded that the construction, operation and decommis- sioning of the KSM Project are not likely to result in significant adverse environmental effects. Seabridge Gold Chairman and CEO Rudi Fronk said, "I would like to acknowl- edge the extraordinary dedication of our personnel and the outstanding professionalism of the BCEAO which together have brought us to this success- ful conclusion. I would also like to thank the Nisga'a Nation, First Nations and local communities who participated in this process, for their expressions of encour- agement and support as well as for their thoughtful input which has helped us improve our project design. We are con- fident that KSM will also be approved at the Federal level within the next several months. "This decision confirms that KSM is a well-designed, environmentally respon- sible project which is technically feasible and offers significant economic benefits to both British Columbia and Canada. This decision also affirms the value of extensive public consultation early in the environ- mental assessment process which helped us to understand the cultural, social, envi- ronmental and economic context of the KSM Project." The KSM Project has been undergoing a joint harmonized federal-provincial envi- ronmental assessment review as outlined by the British Columbia Environmental Assessment Act and the Canadian Environmental Assessment Act. On July 21, 2014, the Canadian Environmental Assessment Agency (CEAA) released its final Comprehensive Study Report for the KSM Project which concluded that "the KSM Project is not likely to cause significant adverse environmental effects taking into account implementation of the mitigation measures described in the report." After the public comment period, the Federal Minister of Environment will decide whether to approve the KSM Project. Seabridge expects the Federal Minster's decision in the fall. FoRtUne MineRaLS aCqUiReS CoLoRado SiLveR Mine & MiLL Fortune Minerals Limited [FT-TSX; FTMD-OTCQX] has entered into an agree- ment with the owners of the Revenue Silver Mine (RSM) in southwest Colorado to amend the terms under which it can acquire the remaining interest in the mine with lower payment terms under an accel- erated schedule. Fortune also executed term sheets with Lascaux Resource Capital Fund I LP to provide US $35 million to finance the acquisition under a metal prepay facility that is repaid with a fixed schedule of metal shipments from the RSM plus interest over a four-year period. The company, through its wholly-owned subsidiary Fortune Revenue Silver Mines Inc., acquired an initial 12% participating interest in the RSM in May 2014 and has been the operator of the mine since that time. Pursuant to the amending agreement, Fortune Revenue can now complete the acquisition of a 100% interest in the RSM by paying the owners US $15.5 million, with an obligation to pay a further US $10 million following completion of the acqui- sition. Under the previous terms of the agreement, Fortune Revenue was obligated to make an initial cash payment of US $14 million with aggregate deferred payment obligations of US $34.5 to US $36.8 million. The target closing date for the transaction has been extended from September 2 to October 1, 2014. To finance the acquisition and opera- tions, Fortune entered into two term sheets with Lascaux. The first facility will pro- vide an initial US $4 million bridge loan for working capital and to complete near term capital improvements required at the mine. The second facility will provide US $35 million to repay the bridge loan, com- plete the acquisition, pay the amount due to the previous mine owner, and provide additional project working capital, and a further second tranche of US $10 million to fund the remaining deferred payment due to the current owners. The principal amount of the loan will be repaid from production from the RSM based on a fixed schedule of metal ship- ments from the mine's estimated equivalent silver production over the four-year term. Fortune also completed a private place- ment financing with an arm's length institutional investor to raise proceeds of CAD $1 million to be used for working capital. A Preliminary Economic Assessment report, prepared by SRK Consulting, dem- onstrates an attractive 73.2% After-Tax IRR and US $58.8 million 6% discounted After Tax NPV) for the project. The mine hosts measured/indicated resources of 16.3 million oz silver and 10.1 million oz inferred. The Revenue Mine is a fully permitted and constructed mine, mill and surface facilities in the commissioning for a ramp up to 400 tons per day. Cash costs are US $6.62/oz of silver net of by-product credits, excluding freight, treatment and refining charges (TC/RC) and US $10.28/oz C1 cash cost including TC/RC charges. n