Canadian agency clears up world’s largest gold project permitting process
Canada’s National Contact Point (NCP) has shrugged off complains about certain aspects of the environmental assessment review process for Seabridge Gold’s (TSX:SEA) (NYSE:SA) massive KSM project in British Columbia, the miner said Tuesday.
According to the agency, the case does not merit further examination and the file has now been closed after only the initial assessment level of review.
NCP’s verdict came in response to allegations made by the South East Alaska Conservation Council (SEACC), a non-governmental organization, claiming that Seabridge failed to disclose project documents and engage appropriately with stakeholders in Alaska.
The group had also accused the Canadian miner of not exercising sufficient due diligence regarding potential environmental and human rights impacts of the KSM, the world's largest undeveloped gold-copper project by reserves.
Seabridge had been accused of failing to disclose project documents and engage with stakeholders in Alaska, as well as not properly considering potential environmental and human rights impacts of the KSM project.
“We are pleased that the thoroughness of the federal and provincial joint environmental assessment review process for KSM has been acknowledged and that this complaint has been dismissed, the company’s chairman and CEO Rudi Fronk said in a statement.
Shares in the company climbed moderately on the news, trading 0.64% higher in Toronto at Cdn$14.19 at 11:05AM ET and advancing 1.36% to $11.15 in New York at 11:15AM ET.
Canada’s minister of the environment approved the giant project during the final days of 2014. The federal and provincial environmental assessment process took nearly seven-years and KSM was only the second metal mine in five years to receive the green-light from authorities.
In November last year, the federal government granted the Toronto-based miner a 25-year licence required for the construction, operation and maintenance of a water storage facility and related works at northwestern BC-based project.
The company said at the time that the permit, which regulates all structures and activities situated on waters straddling the border with the US, further validated the project. It proves, Seabridge said, that KSM won’t result in any “significant impacts” to the environment, including those waters that flow into Alaska.
During its first seven years of operation, the mine is expected to have an annual gold output of 1 million ounces and life of mine annual production is estimated at 592,000 ounces of gold, 286,000 pounds of copper and 2.8 million ounces of silver.
Construction costs, however, have soared lately, with the most recent preliminary study showing that building the mine would cost $5 billion, or about 20% of the current market capitalization of Barrick Gold ($20.83bn), the world’s No.1 producer by output.
The NCP operates within the Canadian Department of Foreign Affairs and promotes adherence to the Organization for Economic Co-operation and Development’s (OECD) non-binding Guidelines for Multinational Enterprises.
Seabridge Gold holds a 100% interest in several North American gold resource projects. The miner’s key assets are the KSM property located near Stewart, B.C, the Courageous Lake gold project — in Canada’s Northwest Territories — and Iskut, in B.C., which the company obtained with the closing of the SnipGold Corp. acquisition, in June, 2016
You can read NCP’s full report here.