Mineral Resource Estimation Zones 132 and 141, Red ... · Mineral Resources Zones 132 and 141, Red...

Mineral Resource Estimation Zones 132 and 141, Red Mountain

Gold Project, British Columbia

Report Prepared for

Seabridge Gold Inc. 172 King Street East

Suite 300 Toronto, Ontario M5A 1J3

Tel: (416) 367-9292 Fax: (416) 367-2711

Report Prepared by

SRK CONSULTING (CANADA) INC. Suite 1000, 25 Adelaide Street East

Toronto, ON M5C 3A1 Tel: (416) 601-1445

Fax: (416) 601-9046 Web Address: www.srk.com

E-mail: [email protected]

Project Reference Number: 3CS012.002

January 2005

SRK Consulting 3CS012.002 – Seabridge Gold Inc. Mineral Resources Zones 132 and 141, Red Mountain, BC Page i

RD/JFC Resource.Report.3CS012.002.RD_JFC.20050210.doc, Feb. 11, 05, 4:36 PM January 2005

Mineral Resource Estimation Zones 132 and 141, Red Mountain Gold Project, British Columbia

Seabridge Gold Inc. 172 King Street East Suite 300 Toronto, Ontario M5A 1J3 Canada Tel: (416) 367-.9292 • Fax: (416) 367-2711 E-mail: [email protected] Web Address: www.seabridgegold.net

SRK Project Number 3CS012.002 SRK CONSULTING (CANADA) INC. Suite 1000,25 Adelaide Street East Toronto, ON M5C 3A1 Tel: (416) 601-1445 • Fax: (416) 601-9046 E-mail: [email protected] Web Address: www.srk.com

January 2005 Compiled by:

Ron Deptuck Kelly Sexsmith Associate Resource Geologist Senior Geochemist Endorsed by:

Jean-Francois Couture Principal Geologist

Cover: Lower left. View of Red Mountain looking towards the east. The camp is located in the lower-right corner and the upper access road leads to the main portal further up the Red Mountain. Upper right. View at the Red Mountain Cirque from the shop area down towards the camp with the Bromley Glacier in the background..

SRK Consulting 3CS012.002 – Seabridge Gold Inc. Mineral Resources Zones 132 and 141, Red Mountain, BC Page ii


Executive Summary

Introduction In 2003, Seabridge Gold Inc (“Seabridge”) mandated SRK Consulting (Canada) Inc. (“SRK”) to complete a Preliminary Assessment Engineering Study on the Red Mountain underground gold project located approximately eighteen (18) kilometres east of the town of Stewart, British Columbia. This study, which was based on an existing Mineral Resource model prepared by the previous project operator, showed that the project is sensitive to gold prices and to available tonnage and that therefore availability of additional mineralization could improve the project economic returns. In September 2004, SRK was commissioned by Seabridge to examine the project borehole database to determine whether there is geological merit in estimating Mineral Resource from existing borehole data outside the area considered by previous project operators. SRK’s investigations revealed that historical borehole intersected significant gold mineralization outside of the main Mineral Resource area and that for two areas (Zones 132 and 141), there is sufficient drilling information to reasonably establish geological continuity and support a Mineral Resource estimate. Seabridge subsequently asked SRK to create a resource model for those areas. This Technical Report presents the results of the Mineral Resource estimation work undertaken by SRK on the Red Mountain gold project between September 2004 and January 2005, in compliance with National Instrument 43-101 and Form 43-101F1 guidelines.

Project location The Red Mountain project is located within the Boundary Range of the north-western British Columbia Coast Mountains, approximately eighteen (18) kilometres east of the town of Stewart. The Red Mountain project lies within the Skeena Mining Division between the Cambria Ice Field and the Bromley Glacier. The centroid of the project is located at latitude 55 degrees 57 minutes north and longitude 129 degrees 42 minutes west. The Red Mountain property includes one hundred and ten (110) contiguous mineral claims (832 modified grid unit) registered in the name of Seabridge and covering an area of approximately 20,600 hectares. Five (5) of the mineral claims comprising eighty-six (86) units have been legally surveyed and are ready to be taken as lease. The known gold-silver Mineral Resource on this project is located in the northwest corner of the ORO I mineral claim. The project resides on Crown land and no private properties lie within the operating plan area.

Regional and Local Geology The Red Mountain project is located near the western margin of the Stikine terrain in the Intermontane Belt. In the Stewart area, the Skitine terrain comprises three main stratigraphic assemblages: Middle and Upper Triassic clastic rocks of the Stuhini Group, Lower and Middle Jurassic volcanic and

SRK Consulting 3CS012.002 – Seabridge Gold Inc. Mineral Resources Zones 132 and 141, Red Mountain, BC Page iii


clastic rocks of the Hazelton Group, and Upper Jurassic sedimentary rocks of the Bowser Lake Group. Three distinct intrusive suites intrude the volcano-sedimentary units. These are: Late Triassic calc-alkaline Stikine plutonic suite, coeval with the Stuhini Group rocks; Early to Middle Jurassic intrusions, roughly coeval with the Hazelton Group rocks; and Eocene intrusions of the Coast Plutonic Complex. The Red Mountain area lies along the western edge of a complex, northwest-southeast trending, doubly-plunging structural culmination, which was formed during the Cretaceous when rocks of the Stuhini, Hazelton and Bowser Lake groups were folded and/or faulted. It is underlain by folded Middle to Upper Triassic and Early Jurassic rocks that are intruded by Early Jurassic plutons, sills and dikes known as the Goldslide intrusions, and by Tertiary intrusions.. The Goldslide intrusions comprise a suite of extensive and variably hydrothermally-altered sub-volcanic sills, dikes and irregular intrusive bodies subdivided into three texturally and chemically distinctive phases: the Hillside porphyry, the Goldslide porphyry and the Biotite porphyry. All of the Mineral Resources of the Red Mountain gold project occur in three (3) main zones (Marc, AV and JW zones) interpreted to have formed during a single geological event in the Early Jurassic but later separated by Tertiary extensional block faulting. They are located within a large gossanous area extending over much of Red Mountain and hosting several other gold-silver showings. The sulphide-rich gold-silver mineralization is closely related to the emplacement of the Goldslide intrusions. Zones 132 and 141 are located in proximity to the Marc, AV and JW zones. The gold mineralization has been delineated by a series of boreholes drilled under a crosscutting pattern. The gold mineralization presents similar geological features to the other auriferous mineralization. Gold grades are however on average lower than in the Marc, AV and JW zones. Zone 132 is a gently west-dipping tabular auriferous sheet that represents the southern down-dip continuation of the AV and JW Zones. On vertical sections this auriferous zone measures between forty (40) to 200 metres in length and is between four (4) and ten (10) metres in thickness. A total of fourteen (14) boreholes tested Zone 132. Zone 141 is located approximately 280 metres into the hanging wall of and to the south of the JW zone. On vertical section the auriferous zone form an irregular oblong spherical object measuring between twenty (20) and seventy (70) metres in diameter. In total thirteen (13) boreholes tested this auriferous zone.

Mineral Resource Estimation The borehole database for the Red Mountain project comprises a total of four-hundred-and sixty-six (466) boreholes totalling approximately 134,800 metres. Four-hundred-and-six (406) holes (105,130 metres) were drilled by Bond and Lac Minerals between 1989 and 1994. Sixty (60) boreholes were drilled by Royal Oak in 1996. No further drilling has been done on this project since. Data used by SRK in estimating the Mineral Resources for Zones 132 and 141 include a sub-set of seventy-eight (78) boreholes totalling approximately

SRK Consulting 3CS012.002 – Seabridge Gold Inc. Mineral Resources Zones 132 and 141, Red Mountain, BC Page iv


28,711 metres. Thirty-four (34) of these holes have intersected gold mineralization in Zones 132 and 141. The remaining forty-four (44) holes are peripheral to the Zones and were used to assist the interpretation of geological data. Solid body models were created by SRK to encompass the gold and silver mineralization above a one (1) gpt gold cut-off. The original Gemcom block model was expanded to accommodate Zones 132 and 141 by extending its western boundary an additional 300 metres to the west and deepening it by another 100 metres. A bulk density of 2.91 was used to convert volumes into tonnages for all blocks in the model for Zones 132 and 141. After statistical and geostatistical modelling, SRK interpolated gold and silver grades into an expanded block model by ordinary kriging. For comparison, gold and silver grades were also interpolated using an inverse distance weighted cubed (“IDW3”) function. Primary search distances, limiting and maximum distances for composites for gold and silver by OK and IDW3 for Zones 132 are approximately double those for Zone 141 because of the wider drill hole spacing. An anisotropic composite search routine was used to create the IDW3 model. Octant search is employed by both routine (OK and IDW3) to “decluster” composite data. The Mineral Resources estimated by SRK for Zones 132 and 141 of the Red Mountain gold project are classified in the Inferred Mineral Resource category according to the “CIM Standards on Mineral Resources and Reserves: Definitions and Guidelines” (August, 2000). The Mineral Resources were classified by D. Deptuck, P Geo an appropriate Qualified Person as defined by NI43-101. This classification is based primarily on the drilling spacing and the lack of underground exploration data, which lower the confidence in the lateral continuity of borehole data. This is consistent with the classification used for the Marc, AV and JW zones. The Inferred Mineral Resources for Zones 132 and 141 for various cut-off grades are presented in Table i.

Table i: Classified Inferred Mineral Resources at Various Gold Cut-off Grades, Zones 132 and 141, Red Mountain Project, SRK Consulting, January 2005.

Cut-off (gpt gold)

Tonnage(tonnes)

Gold* (gpt)t

Contained gold(Troy ounces)

Silver (gpt)

Contained silver(Troy ounces)

0.00 1,778,100 2.92 166,700 3.22 184,3001.00 1,728,950 2.97 165,200 3.31 183,7002.00 1,295,300 3.45 143,700 4.18 174,0003.00 773,600 4.08 101,400 5.53 137,6004.00 333,000 4.91 52,500 7.22 77,3005.00 114,700 5.89 21,700 10.25 37,8006.00 30,100 7.59 7,350 18.48 18,0007.00 13,700 8.95 3,950 19.49 8,6008.00 6,500 10.63 2,200 18.90 3,9509.00 3,700 12.37 1,450 19.90 2,350

* gold grades cut at 44 gpt

SRK Consulting 3CS012.002 – Seabridge Gold Inc. Mineral Resources Zones 132 and 141, Red Mountain, BC Page v


For Zones 132 and 141, considering that gold mineralization outlines were defined using a one (1) gpt gold cut-off and that it is not possible to define continuous regular shapes at higher gold cut-off with the widely spaced borehole data, SRK is of the opinion that the Mineral Resources for Zones 132 and 141 are appropriately stated using a one (1) gpt gold cut-off as indicated in Table ii.

Table ii: Inferred Mineral Resource Statement*, Zones 132 and 141, Red Mountain Project, British Columbia, SRK Consulting January 2005.

Zone Tonnage(tonnes)

Gold (gpt)**

Contained Gold (Troy ounces)

Silver (gpt)

Contained Silver (Troy ounces)

Zone 141 434,300 3.31 46,200 6.94 96,900 132 740,600 3.15 75,000 1.86 44,300133 12,600 4.06 1,600 0.00 0135 309,200 1.76 17,500 0.90 8,900136 129,000 2.94 12,200 2.09 8,700137 103,300 3.80 12,600 7.51 24,900Sub-total Zones 132 1,294,700 2.86 119,000 2.09 86,800

Total Inferred 1,729,000 2.97 165,200 3.31 183,700

* Reported at a 1 gpt gold cut-off. ** gold grades cut at 44 gpt. At the present, the drilling information is simply not dense enough to support construction of mineralization outlines at a higher cut-off grade. SRK recommends that future drilling target these higher grade areas to confirm the interpretation proposed here and possibility expand areas of “higher grade” gold mineralization. SRK briefly reviewed drilling data for other gold occurrences in the vicinity of the deposit. These occurrences have been tested by few boreholes and each should be re-evaluated as part of a comprehensive exploration program for this gold project. In conclusion, SRK is of the opinion that there is excellent potential to expand the Mineral Resource base of the Red Mountain gold project with additional exploration drilling.

SRK Consulting 3CS012.002 – Seabridge Gold Inc. Mineral Resources Zones 132 and 141, Red Mountain, BC Page vi


Table of Contents

Executive Summary................................................................. ii Introduction .................................................................................... ii Project location .............................................................................. ii Regional and Local Geology.......................................................... ii Mineral Resource Estimation .........................................................iii

Table of Contents ................................................................... vi

List of Tables......................................................................... viii

List of Figures ......................................................................... ix

1 Introduction and Terms of Reference............................... 1 1.1 Qualifications of SRK............................................................. 2 1.2 Scope of Work ....................................................................... 2 1.3 Basis of the Technical Report................................................ 3 1.4 Site Visit................................................................................. 3

2 Disclaimer ........................................................................... 4

3 Property Description and Location................................... 5

4 Accessibility, Climate, Local Resources, Infrastructure and Physiography .............................................................. 7

5 History ................................................................................. 9

6 Geological Setting............................................................ 11 6.1 Regional Geology ................................................................ 11 6.2 Property Geology................................................................. 13 6.3 Deposit Types...................................................................... 15 6.4 Mineralization....................................................................... 15

6.4.1 Geology of the Marc, AV and JW Zones............................ 15 6.4.2 Geology of Zones 132 and 141.......................................... 17

7 Exploration........................................................................ 20 7.1 Diamond Drilling .................................................................. 20 7.2 Sampling Approach and Methodology................................. 21 7.3 Sample Preparation, Analyses and Security ....................... 21

7.3.1 Quality Assurance and Quality Control Programs ............. 22 7.3.2 Specific Gravity Data.......................................................... 22

7.4 Data Verification .................................................................. 23

8 Adjacent Properties.......................................................... 23

9 Mineral Processing and Metallurgy ................................ 24

SRK Consulting 3CS012.002 – Seabridge Gold Inc. Mineral Resources Zones 132 and 141, Red Mountain, BC Page vii


10 Mineral Resource Estimation .......................................... 26 10.1 Introduction.......................................................................... 26 10.2 Data ..................................................................................... 26 10.3 Solid Body Modelling ........................................................... 27

10.3.1 Design of Modeling Criteria................................................ 27 10.3.2 Solid Body Modelling.......................................................... 28

10.4 Statistical Analysis ............................................................... 31 10.4.1 Sample Statistics................................................................ 31 10.4.2 Composite Statistics........................................................... 35

10.5 Grade Capping .................................................................... 36 10.5.1 Average Zone Composites ................................................ 37

10.6 Semi-Variogram Analysis .................................................... 41 10.6.1 Borehole Semi-variograms................................................. 41 10.6.2 Three Dimensional Directional Semi-variograms .............. 42 10.6.3 Point Validation .................................................................. 43

10.7 Grade Interpolation.............................................................. 46 10.7.1 Block Model........................................................................ 46 10.7.2 Grade Interpolation ............................................................ 48

10.8 Mineral Resource Classification .......................................... 49

11 Other Relevant Data ......................................................... 50

12 Summary and Conclusions ............................................. 51

13 Recommendations ........................................................... 53

14 References ........................................................................ 54

APPENDIX A........................................................................... 56

APPENDIX B........................................................................... 59

APPENDIX C........................................................................... 62

APPENDIX D........................................................................... 68

APPENDIX E........................................................................... 75

CERTIFICATE and CONSENT ............................................... 78

SRK Consulting 3CS012.002 – Seabridge Gold Inc. Mineral Resources Zones 132 and 141, Red Mountain, BC Page viii


List of Tables Table i: Classified Inferred Mineral Resources at Various Gold Cut-off

Grades, Zones 132 and 141, Red Mountain Project, SRK Consulting, January 2005...............................................................iv

Table ii: Inferred Mineral Resource Statement*, Zones 132 and 141, Red Mountain Project, British Columbia. SRK Consulting January 2005................................................................................................ v

Table 1: Mine Grid Location, Zones 132, 141, Red Mountain Gold Project, British Columbia. ............................................................. 17

Table 2: Specific Gravity Data, Red Mountain Gold Project, 1993 and 1994 Sampling Program*. ............................................................ 23

Table 3: Red Mountain Gold Project, British Columbia, Microsoft Access Tables Created by SRK from the Gemcom Database. ................ 27

Table 4: Rock Code Assigned for Zones 132 and 141. ................................ 29 Table 5: Rock Code Changed in Red Mountain Borehole Database............ 32 Table 6: Sample Statistics for the Combined 132 Zones. ............................. 33 Table 7: Sample Statistics for Zone 141. ...................................................... 33 Table 8: Composite Statistics for the Combined 132 Zones. ........................ 35 Table 9: Composite Statistics for Zone 141. ................................................. 35 Table 10: Correlation Matrix for Zones 132 and 141..................................... 36 Table 11: Statistics for Average Zone Composite, Zones 132 and 141,

Red Mountain Project. .................................................................. 37 Table 12: Compilation of All Borehole Intercepts Considered for Mineral

resource Estimation, Zones 132 and 141, Red Mountain Project........................................................................................... 40

Table 13: Borehole Semi-Variogram Models, Zones 132 and 141, Red Mountain Project........................................................................... 41

Table 14: Three Dimensional Directional Semi-variogram Models, Zones 132 and 141, Red Mountain Gold Project. ................................... 42

Table 15: Kriging Parameters used for Grade Interpolation, Zones 132 and 141, Red Mountain Project.................................................... 43

Table 16: Point Validation Statistics Gold, 141 Zone, True Distance Search Used................................................................................. 44

Table 17: Point Validation Statistics Gold, 141 Zone, Anisotropic Search Used. ............................................................................................ 44

Table 18: Point Validation Statistics Silver, 141 Zone, True Distance Search Used................................................................................. 45

Table 19: Point Validation Statistics Gold, Combined 132 Zones, True Distance Search Used.................................................................. 45

Table 20: Point Validation Statistics Silver, Combined 132 Zones, True Distance Search Used.................................................................. 45

Table 21: Attributes of the Red Mountain Block Model. ................................ 46 Table 22: Red Mountain GemCom Block Model Attributes........................... 47 Table 23: Red Mountain MineSight Block Model Attributes. ......................... 47 Table 24: Classified Inferred Mineral Resources at Various Gold Cut-off

Grades, Zones 132 and 141, Red Mountain Project, SRK Consulting, January 2005............................................................. 49

SRK Consulting 3CS012.002 – Seabridge Gold Inc. Mineral Resources Zones 132 and 141, Red Mountain, BC Page ix


Table 25: Block Model Statistics for the Combined Zones 132..................... 50 Table 26: Block Model Statistics for Zone 141.............................................. 50 Table 27: Inferred Mineral Resource Statement*, Zones 132 and 141,

Red Mountain Project, British Columbia. SRK Consulting January 2005................................................................................ 52

List of Figures Figure 1. Location of Mineral Titles, Red Mountain Gold Project British

Columbia......................................................................................... 6 Figure 2. Geology of the Red Mountain Gold Project Area (from Rhys,

1995)............................................................................................. 12 Figure 3: Relative Spatial Distribution of Auriferous Zones in the Red

Mountain Gold deposit.................................................................. 16 Figure 4: Top. Vertical section 1350N showing the position of Zone 141

relative to the AV Zone. Bottom. Vertical section 1450N showing the position of Zones 136, 137 and 132 relative to the AV Zone. See Figure 3 for Section location. ................................ 18

Figure 5: Vertical Section 1600N showing the position of Zone 132 relative to the JW Zone (see Figure 3 for section location). Note that Zone 132 represents the down-dip extension of the JW zone. In modelling Zone 132, SRK took care to close the limits of Zone 132 against that of the adjacent JW Zone. ............ 19

Figure 6: Assay Interval (top) and Composite Length (bottom) Histograms for Zones 132 and 141, Red Mountain Gold Deposit.......................................................................................... 34

Figure 7: (Top) Log Probability Plot for Gold (trimmed to 44 gpt); (Bottom) Log Probability Plot for Silver Composites, Zone 141.................. 38

Figure 8: (Top) Log Probability Plot for Gold (trimmed to 44 gpt), 132 Zones; (Bottom) Log Probability Plot for Silver, 132 Zones. ........ 39

Figure 9: Borehole Semi-variograms, Zones 132. Top. AUUSE, 3D global combined (file dat301.lb). Bottom. AGASY, 3D global combined, (file dat301.ld). ............................................................ 63

Figure 10: Borehole Semi-variograms, Zone 141. Top. AUUSE, 3D global combined (file dat301.la). Bottom. AGASY, 3D global combined, (file dat301.lc). ............................................................ 64

Figure 11: Top. 132 Zone, directional semi-variogram AUUSE, 3D global, (file dat303.lc). Bottom. 132 Zone, directional semi-variogram AGASY, 3D global, (file dat303.le) ............................................... 65

Figure 12: Top. 41 Zone, directional semi-variogram AUUSE, vertical axis 112.5/-45, (file dat303.lf). Bottom. directional semi-variogram AGASY, major axis 22.5/0, (file dat303.ld).................. 66

Figure 13: Top. 141 Zone, directional semi-variogram AGASY, minor axis 112.5/45, (file dat303.ld). Bottom. Directional semi-variogram AGASY, vertical axis 112.5/-45, (file dat303.lg). .......................... 67

SRK Consulting 3CS012.002 – Seabridge Gold Inc. Mineral Resources Zones 132 and 141, Red Mountain, BC Page 1


1 Introduction and Terms of Reference In 2003, Seabridge Gold Inc (“Seabridge”) mandated SRK Consulting (Canada) Inc. (“SRK”) to complete a Preliminary Assessment Engineering Study on the Red Mountain underground gold project located approximately eighteen (18) kilometres east of the town of Stewart, British Columbia. The objective of the study was to build on previous project work to identify the best project development approach. This study was based on a Mineral Resource model prepared by Craig (2002). It was concluded that an underground mining project required a minimum gold price of US$400/oz to be economically viable (yielding an internal rate of return of five percent), and that higher gold prices are required to provide an attractive rate of return. This study showed that the project is sensitive to available tonnage and that therefore availability of additional mineralization could improve the project economics returns. Previous studies suggested that there is potential to increase the Mineral Resources of this project with additional exploration. Moreover, a summary review of exploration data suggests that known gold mineralization peripheral to or nearby the currently delineated Mineral Resources warrants a closer re-evaluation. In September 2004, SRK was commissioned by Seabridge to examine the project borehole database to determine whether there is geological merit in estimating Mineral Resource from existing borehole data outside the area considered by Craig (2002). SRK’s investigations revealed that historical borehole intersected significant gold mineralization outside of the area that was considered by Craig (2002) and that for two areas (Zones 132 and 141), there is sufficient drilling information to reasonably establish geological continuity and support a Mineral Resource estimate. Seabridge subsequently asked SRK to create a resource model for those areas. The purpose of this report is to present the results of the Mineral Resource estimation work undertaken by SRK on the Red Mountain gold project between September 2004 and January 2005. This Technical Report complies with National Instrument 43-101 and Form 43-101F1 guidelines and was prepared in conformity with generally accepted CIM “Best Practice Guidelines”. This technical report can be considered as an addendum to the Technical Report prepared by Craig (2002) because the portion of the Red Mountain project considered in this report is located outside the volume considered by Craig (2002).



1.1 Qualifications of SRK The SRK Group comprises over 500 professionals, offering expertise in a wide range of resource engineering disciplines. The SRK Group’s independence is ensured by the fact that it holds no equity in any project and that its ownership rests solely with its staff. This permits SRK to provide its clients with conflict-free and objective recommendations on crucial judgment issues. SRK has a demonstrated track record in undertaking independent assessments of Mineral Resources and Mineral Reserves, project evaluations and audits, technical reports and independent feasibility evaluations to bankable standards on behalf of exploration and mining companies and financial institutions worldwide. The SRK Group has also worked with a large number of major international mining companies and their projects, providing mining industry consultancy service inputs. This technical report was prepared by Mr. Ron Deptuck, P.Geo. (APEGS #10769), Ms. Kelly Sexsmith, P. Geo. (APEGBC#21397) and Dr Jean-François Couture, P.Geo. (APGO#0197). Mr. Deptuck is an Associate Resource Geologist with SRK. He has been practicing his profession since 1971. Ms. Sexsmith is a Senior Geochemist with SRK and has been practicing her profession continuously since 1996. Dr Couture is a Principal Geologist with SRK and has been employed by SRK since 2001. He has been engaged in mineral exploration and mineral deposit studies since 1982.

1.2 Scope of Work The scope of work involved a review of the geology of the Red Mountain gold project with a particular emphasis on those areas of the project not considered in the Mineral Resource model prepared by Craig (2002). Amongst other things, this assignment involved an assessment of the following aspects of the project: • Regional and local geology; • Review of historical exploration drilling data; • Verification and validation of relevant portions of the borehole database, • Geological interpretation of zones 132 and 141; • Solid body modelling; • Geostatistical modelling; • Mineral Resource estimation.



1.3 Basis of the Technical Report This technical report is primarily based on existing technical information about the Red Mountain project. This technical data was collected by previous project operators between 1986 and 2002. In preparation of this report SRK relied on the following documents: • A GEMCOM borehole database originally created by North American

Metals Corporation (“NAMC”) in 2000; • A Technical Report prepared by Craig (2002) documenting a Mineral

Resource estimate prepared for the Marc, AV and JW zones (Available from SEDAR; www.sedar.com);

• A Preliminary Assessment Engineering Study Completed by SRK in 2003 (Available from SEDAR; www.sedar.com);

• Copies of paper files maintained by Seabridge on the Red Mountain project such as drilling logs and surveying records.

1.4 Site Visit SRK has been involved with the Red Mountain project since August 2000. The extent of the involvement of SRK includes surface and underground site inspections and environmental monitoring as required by the British Columbia Mining Act for the permit issued to Seabridge. Recent site visits include field investigations in August and September 2003 to conduct field investigations to collect information for an updated reclamation plan for the project (SRK, 2004) and to consider alternative designs for the proposed tailings disposal facility as a follow-up to the Preliminary Assessment of the Red Mountain project (SRK, 2003); and a monitoring and inspection in September 2004. During these investigations, SRK inspected surface facilities and all underground workings above the flooding elevation, and collected water and solids samples for the purposes of environmental monitoring. The access road that extends from the Stewart-Cassiar highway up the Bitter Creek valley towards the Red Mountain site was inspected via helicopter. Through out the course our SRK’s involvement on the Red Mountain project the following SRK professionals have visited the Red Mountain project: Ms. Kelly Sexsmith, P.Geo.; Mr. Dylan MacGregor, GIT and Dr. Maritz Rykaart, P.Eng.



2 Disclaimer SRK’s opinion contained herein and effective January 20, 2005, is based on information provided to SRK by Seabridge throughout the course of SRK’s investigations, which in turn reflect various technical and economic conditions at the time of writing. Given the nature of the mining business, these conditions can change significantly over relatively short periods of time. Consequently actual results may be significantly more or less favourable. This report includes technical information, which requires subsequent calculations to derive sub-totals, totals and weighted averages. Such calculations inherently involve a degree of rounding and consequently introduce a margin of error. Where these occur, SRK does not consider them to be material. SRK is not an insider, associate or an affiliate of Seabridge, and neither SRK nor any affiliate has acted as advisor to Searidge or its affiliates in connection with this project. The results of the technical review by SRK are not dependent on any prior agreements concerning the conclusions to be reached, nor are there any undisclosed understandings concerning any future business dealings. SRK reviewed a limited amount of correspondence, pertinent maps and agreements to assess the validity and ownership of the mining titles. However, SRK did not conduct an in-depth review of mineral title and ownership; consequently, no opinion will be expressed by SRK on this subject.



3 Property Description and Location The Red Mountain project is located within the Boundary Range of the north-western British Columbia Coast Mountains, approximately eighteen (18) kilometres east of the town of Stewart. The Red Mountain Project lies within the Skeena Mining Division between the Cambria Ice Field and the Bromley Glacier. The centroid of the project is located at latitude 55 degrees 57 minutes north and longitude 129 degrees 42 minutes west. A comprehensive review of land tenure and discussion of ownership and royalty agreements was presented by Craig (2002). Since this report a total of fifteen (15) claims have been added to the project by staking in 2002 and 2003. The Red Mountain property includes one hundred and ten (110) contiguous mineral claims (832 modified grid unit) registered in the name of Seabridge (owner number 145264) and covering an area of approximately 20,600 hectares (Figure 1). Five (5) of the mineral claims comprising eighty-six (86) units have been legally surveyed and are ready to be taken as lease. These are the ORO I, ORO IV, ORO VI, Hrothgar and part of the Vera 3 claims. The known gold-silver Mineral Resource on this project (Marc, AV and JW zones) is located in the northwest corner of the ORO I mineral claim. According to the Government of British Columbia Land Information System, all claims are in good standing as of January 18, 2005. A complete listing of the Red Mountain property titles and tenure information is presented in Appendix A. The project currently resides on Crown land and no private properties lie within the operating plan area. The Red Mountain Project is wholly owned by Seabridge. It is subject to the payment of productions royalties on the key “Wotan claims” group (seven claims: ORO I-VI and Hrothgar; and from any other property within a two kilometres area of influence around those claims) and to the payment of an annual minimum royalty of $50,000. Production from the “Wotan claims” is subject to two separate royalties aggregating 3.5 percent of net smelter return (“NSR”) comprising a 1.0 percent NSR payable to Barrick Gold Corporation (“Barrick”) and a 2.5 percent NSR payable to Wotan Resources Corporation (“Wotan”). The Barrick 1.0 percent NSR royalty is applicable to all existing claims at the time the property was sold to Royal Oak in August 1995. The Red Mountain Project was assembled by Bond Gold Canada Inc (“Bond Gold”) through three (3) option agreements exercised by its successor Lac Minerals Ltd. (“Lac Minerals”). Each agreement provides for NSR royalties such that the bulk of the property has stacked royalty obligations ranging from 2.0 to 6.5 percent. Certain peripheral non-core claims staked by Bond Gold or Lac Minerals carry a 1.0 percent NSR royalty, and three none-core claims staked by Royal Oak are free of royalty. The principal underlying agreements were discussed by Craig (2002) and are not presented here.



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251663251662

251660

251661

251627

251633251632

251631

251630

251628

251629250793

250792 250782 250781

250784250791250783

250785250786

250788

250790250789

250787

Kim Fr.321646

250331

250332

253778

250794

250336

250335

250334

Pam 2250796

250333

104A04W103P13W

AlsoBromley338971

DATE: 07 JAN 04

REVISED BY: SWD

SCALE:

Seabridge Gold Inc.Red Mountain Property

Location Map

DATE: 09 SEP 02

DRAFTED: SWD

COMPILED: SWD

MAP No.:

PLAN: Red_Mountain_w_AOI

DATUM: NAD 83

104A04E

0

Scale

metres20001000

4625

00E

4 600

00E

4 575

00E

4 550

00E

4 525

00E

450 0

00E

6212500N

6210000N

6207500N

6205000N

6202500N

6200000N

6197500N

6195000N

CB-1396491

Jose313464

(Camnor Resources Ltd.)

Del251064


Cuervo313465


250481

250482

250472

250471250470

250466

250467

250465

250461

447 5

00E

4650

00E

Claims 250461, 250465, 250466, 250467, 250470, 250472, 250473, 250481, and 250482 registered to Iain A. Logie

Red Mountain Claims

Adjacent Claims

6192500N

Area of Interest

Bart #3330113(Camnor

Resources Ltd.)

Gold Valley 1 395135

BA 3396832

(Edward R. Kruchkowski)

New Red 3 379231

(David E. Molloy)

Red 2371780

(David E. Molloy)367572

367573

Claims 367572 and 367573 registered to David J. Javorsky

Gold Valley 2 395136

Otter 1 395137

Otter 2 395138

404742

404743

404738404735

404734

404740404736

404739

404741 404737

Bud 1403247

(Alojzy A. Walus)

Bud 2403248

(Alojzy A. Walus)

Ram-3403252

(Alojzy A. Walus)

Ram-1403250

(Alojzy A. Walus)

Ram-2403251

(Alojzy A. Walus)

Ram-4403253

(Alojzy A. Walus)

Bud 3403249(Alojzy A.

Walus)

(Including Adjacent Claims)

103P091 103P092 103P093

103P081 103P082103P082 103P083

Figure 1. Location of Mineral Titles, Red Mountain Gold Project British Columbia.



4 Accessibility, Climate, Local Resources, Infrastructure and Physiography The Topography in the project area is characterized by rugged mountainous terrain with steep to precipitous slopes and elevations ranging between 599 and 2,100 metres above sea level. The tree line occurs at approximately 1,300 metres elevation. Areas below the tree line are forested while higher elevations are characterized by bare rock, talus slopes and intermittent alpine vegetation. Alpine glaciers and ice fields are abundant and cover approximately one third of the project area. On-site infrastructure is located above the tree line. The area is characterized by a coastal climate and vegetation, and receives very heavy snowfall. Temperatures at Red Mountain are moderated by the coastal influence. On-site temperature data collected between 1993 and 1994 indicate a mean average temperature of 0.1 degrees Celsius and varying between -25 degrees Celsius in winter and 20 degrees Celsius summer. Wind conditions add a significant wind chill factor throughout the year. In more sheltered locations, hourly average wind speeds regularly exceed 10 metres per second and instantaneous wind speeds in excess of 30 metres per second have been observed. Currently, the Red Mountain Project site is only accessible by helicopter, and this has been the means of transportation that supported all previous exploration and development work. Helicopter support used a staging area located approximately ten (10) kilometres north of Stewart next to highway 37A, at the entrance to Bitter Creek valley. In 1994, Lac Minerals began construction of a 14.5 kilometres access road along Bitter Creek to the bottom station of a planned tramway. The earthworks were mostly completed for the first 13.5 kilometres, with temporary timber bridges crossing creeks. The road has not been completed or maintained since that time. The Red Mountain infrastructure includes an exploration decline that is sealed with a wooden door to prevent access. A service area with rock dumps is located south of the portal along the top of a ridge. This service area consists of an assembly of sea containers, which were originally used as a shop area. It has been damaged by wind and snow and is currently used as a storage area and emergency shelter There are two main rock dumps, one is located near the portal and the second is located approximately 250 metres south of the portal. These rock dumps contain rock from the underground development. The piles were started in 1993 and the last waste rock was added during the summer of 1996.



Several pieces of mobile equipment are stored on top of the main rock dump and other equipment is stored in the service area sea containers. The existing camp area consists of wooden exploration camp buildings, a helipad (a wooden structure) and a steel Quonset hut hanger. These facilities are located along side Goldslide Creek in the cirque below the Red Mountain deposit. The disturbed area around the camp occupies and area of approximately 0.5 hectare. All of the camp buildings are temporary wood frame buildings with no permanent foundations. They were tents originally with walls built around them. The buildings were last used in 1996 and have suffered weather related wear and tear over the years. The camp has deteriorated to the point that actions to preserve it would not be warranted. A lower portal collar was excavated by Lac Minerals at their proposed upper tram station, as part of their development work. The excavation did not advance beyond the collar excavation. There is a network of narrow, steep roads, which connect the camp, the lower portal location and the exploration portal location. Some of the roads along the talus slope immediately below the main portal location are being reclaimed naturally as the talus slope moves each year. Craig (2002) reports that a cash reclamation bond of $1.5 million was posted with the provincial government against the Red Mountain Project. This bond was reduced to 1.0 million in 2002 and can be recovered pending the remediation of certain environmental issues, including the reclamation and closure of approximately 50,000 tonnes of development waste rock that is potentially acid generating; the closure of the decline portal and the removal of the camp and equipment from the site. A reclamation plan filed with the Ministry of Energy and Mines in February 2004 indicates that the bond is sufficient to cover the cost of reclaiming the site. Craig (2002) furthers report that there are no other known environmental issues. The town of Stewart has a population of approximately 600. The town of Terrace, located approximately 316 kilometres from Stewart, has a population of 21,000. Stewart is serviced by a paved airstrip and is located at the head of the Portland Canal, a 120-kilometre long fjord that remains ice-free year-round. The Stewart Bulk Terminal has a dock capacity of 800 tonnes per hour and currently handles ore from the Eskay Creek mine.



5 History The area surrounding the Red Mountain Project has been subject to sporadic exploration in the 1960s and 1970s, primarily for porphyry-molybdenum deposits. Bond Gold became involved in the Skeena Mining Division in late 1988 through an option from Wotan to acquire seven claim blocks (ORO I through VI and Hrothgar). The first high grade gold-silver samples were collected at Red Mountain during the early part of the 1989 program on what was to become the Marc Zone. The discovery was made by tracing the source of auriferous floats uphill to bedrock. During the period 1989-1991, Bond Gold assembled a very large land package surrounding the Red Mountain discovery through three distinct option agreements and claim staking. Public assessment file records indicate that during this period Bond carried out reconnaissance exploration over much of this area, including: prospecting, reconnaissance geology, geochemical sampling, airborne and ground geophysical surveys and a limited amount of diamond drilling. Between 1991 and 1994, following the acquisition of Bond Gold, Lac Minerals delineated a sizeable gold-silver resource through diamond drilling and subsequently drove a decline (1,700 metres) to facilitate drilling access and collect a bulk sample for metallurgical studies. Mine development and environmental baseline studies were initiated in 1993 through late 1994, when the project was put on hold by Barrick, following the acquisition of Lac Minerals. From 1989 through 1994, a total 406 surface and underground boreholes were drilled on the property, including 368 drilled within the limited footprint area of the Marc, AV, JW, AV-JV Tails and 141 gold-silver zones. The project was sold to Royal Oak Mines (“Royal Oak”) in August 1995. The following year, Royal Oak expanded the underground development (305 metres) and conducted surface (22 holes) and underground (15 holes) drill programs targeting the extensions of known mineralization outside the resource volumes and other nearby targets (23 holes). In 1999, Royal Oak went into receivership and Price Waterhouse Coopers was appointed to dispose of the Red Mountain project. In 2000, upon acquisition of the project from Price Waterhouse Coopers, North American Metals Corporation (“NAMC”) completed a comprehensive review of the project and validation of the geological and environmental database. Several new technical studies were carried out leading to the creation of a revised resource model. Seabridge acquired the Red Mountain Project from NAMC in February 2002 and commissioned the first Independent Technical Report on the Red Mountain project (Craig, 2002). This technical report is available on SEDAR (www.sedar.com).



In 2002, the Measured and Indicated Mineral Resources of the Red Mountain Project at a zero gram per ton (“gpt”) gold cut-off were estimated (Craig, 2002) to be 1.59 million tonnes grading an average of 7.80 gpt gold and 29.27 gpt silver. Inferred Mineral Resources were estimated at 0.34 million tons grading an average of 7.45 gpt gold and 12.36 gpt silver (Craig, 2002). Those Mineral Resources are confined within three (3) zones (Marc, AV and JW) of the Red Mountain gold-silver deposit. Gold mineralization located within the fringes of these auriferous zones and gold mineralization outside these zones were not considered in the Mineral Resource estimate initially prepared for NAMC (Craig, 2002 and references therein). In 2003 SRK completed a Preliminary Engineering Study of the Red Mountain gold project. This Preliminary Assessment was conducted using all available Mineral Resources, including Inferred Mineral Resources. In this study, using an appropriate cut-off grade of six (6) gpt gold the Measured and Indicated Mineral Resources were reported by SRK at 1.06 million tons grading an average of 9.22 gpt gold and 28.7 gpt silver. Site investigations were also carried out in 2003 by SRK to collect routine monitoring data and additional data required to address specific items in Permit MX-1-422 as requested by the Ministry of Energy and Mines of the Province of British Columbia. Data collected in the 2003 field investigations was used in developing an updated reclamation plan (SRK, 2004).



6 Geological Setting The geological setting of the Red Mountain area has been described elsewhere (Craig et al, 1994; Alldrick, 1993 and Rhys et al, 1995, Craig, 2001, Craig, 2002 and references therein). The following abridged description is a summary assembled from these sources.

6.1 Regional Geology The Red Mountain project is located near the western margin of the Stikine terrain in the Intermontane Belt. In the Stewart area, the Skitine terrain comprises three main stratigraphic assemblages: Middle and Upper Triassic clastic rocks of the Stuhini Group, Lower and Middle Jurassic volcanic and clastic rocks of the Hazelton Group, and Upper Jurassic sedimentary rocks of the Bowser Lake Group. Primary textures are commonly preserved and regional metamorphism has reached lower greenschists mineral assemblages. Several distinct intrusive suites intrude the volcano-sedimentary units. Late Triassic calc-alkaline intrusions, coeval with the Stuhini Group rocks, form the Stikine plutonic suite; Early to Middle Jurassic intrusions, roughly coeval with the Hazelton Group rocks, have important economic implications for gold mineralization in the Stewart area, including the Red Mountain gold-silver deposits; Eocene intrusions of the Coast Plutonic Complex occur to the west and south of Red Mountain and are associated with high-grade silver-lead-zinc occurrences and molybdenum deposits. The Red Mountain area lies along the western edge of a complex, northwest-southeast trending, doubly-plunging structural culmination, which was formed during the Cretaceous when rocks of the Stuhini, Hazelton and Bowser Lake groups were folded and/or faulted. The tectonic history of northwestern British Columbia in the Red Mountain area during the Mesozoic Era is characterized by the progressive docking of several distinct terrains against ancestral North America and involved the formation of marginal basins, sedimentation and volcanic arc magmatism and related complex deformation. During the Tertiary, the Red Mountain area was subject to extensional block faulting.



Figure 2. Geology of the Red Mountain Gold Project Area (from Rhys, 1995).



6.2 Property Geology The Red Mountain project area is underlain by folded Middle to Upper Triassic and Early Jurassic sedimentary and minor volcanic strata that are intruded by Early Jurassic plutons, sills and dikes known as the Goldslide intrusions, and by Tertiary intrusions. Stratified rocks comprise a sequence of Triassic chert and fine-grained siliciclastic rocks gradationally overlain by Early Jurassic clastic and volcaniclastic rocks. The Goldslide intrusions comprise a suite of extensive and variably hydrothermally-altered sub-volcanic sills, dikes and irregular intrusive bodies which intrude the Triassic and lower parts of the Early Jurassic stratified sequences. The intrusions have been subdivided into three texturally and chemically distinctive phases (Rhys, 1995): the Hillside porphyry, the Goldslide porphyry and the Biotite porphyry. The Hillside porphyry is a medium-grained hornblende and plagioclase-phyric porphyry occurring extensively on the south ridge and the east side of Red Mountain as discordant intrusive bodies. The Goldslide porphyry (197.1+/-1.9 Ma; U/Pb zircon; Rhys et al, 1995) is a hornblende-biotite +/- quartz porphyry intrusion underlying most of the Red Mountain cirque. The Goldslide porphyry is distinguished from the Hillside porphyry by distinct habit of hornblende and plagioclase phenocrysts, and the common presence of quartz and biotite phenocrysts. The presence of Goldslide porphyry dikes cross-cutting Hillside porphyry and xenoliths of Hillside porphyry within the Goldslide porphyry indicate that the Goldslide porphyry is the younger of the two phases. Sills of biotite porphyry (201+/-1 Ma U-Pb on zircon; Rhys et al., 1995) intrude cherty sediments on the west side of Red Mountain. The biotite porphyry, although texturally similar to the Hillside porphyry, contains distinctive biotite phenocrysts and a greater proportion of groundmass. Hornblende and plagioclase phenocrysts are also smaller in size and shapes than in the Goldslide porphyry. Common features associated with the contacts of the Goldslide intrusions (primarily the Hillside porphyry and subordinately the Goldslide porphyry) include intrusive breccias, breccia dikes and sills, highly disrupted bedding in the sedimentary carapace, and country rock rafts. Clasts of the Goldslide porphyry, Hillside porphyry and biotite porphyry in the overlying volcaniclastic sequence and the geochemical similarity of volcanic rocks and the Goldslide intrusions suggest that the Goldslide intrusions are sub-volcanic high level intrusions that were comagmatic with some of the volcanic rocks. A Tertiary stock and several types of mafic dikes intrude the Goldslide intrusions and all stratified rocks on Red Mountain. The McAdam Point Stock (45+/-2 Ma; Ar-Ar on biotite; Schroeter et al., 1992) is a small Tertiary intrusion occurring at the south end of Red Mountain and extends across the



east arm of Bromley glacier. It is a medium to coarse-grained biotite quartz monzonite with common K-feldspar megacrysts. The stock is associated with a 500 to 800 metres wide biotite hornfels thermal aureole imparting a brown to purple tint to all pre-Tertiary rocks. Structural features in the Red Mountain area are consistent with a deformation sequence involving the development of an early widespread hydrothermal system, followed by at least one phase of folding, and displacement along northeast and northwest-trending faults. Mesoscopic folds affect the entire Triassic/Jurassic succession on Red Mountain. The geometry and inferred timing of the folds and related fabric development suggest they are coeval the Cretaceous-Early Tertiary Skeena Fold Belt deformation. Folds have moderate to steep north to northwest-plunging axes, generally steep limb dips, and open to tight, locally isoclinal, forms. Bedding is generally upright. In the Red Mountain area, asymmetry of minor folds varies from clockwise on the west side of the mountain to counter clockwise on the east and together with bedding facing directions, suggests the presence of the large-scale north-northwest-trending Bitter Creek antiform (Greig et al., 1994). The Red Mountain deposits lie at the core of the Bitter Creek antiform. A west to southwest-dipping axial planar slaty cleavage affects Triassic strata, the Hillside porphyry and the Goldslide porphyry and crenulates hydrothermal veinlets, but it is crosscut by the McAdam Point stock and related dikes and veins. Elsewhere rocks are unfoliated, except near shear zones. Minor fold axes in Early Jurassic strata near the summit of Red Mountain generally plunge northwest, and seldom to the northeast. The fold patterns may reflect the complex strain patterns developed around the Goldslide intrusions during a single phase of progressive deformation and folding. At least two phases of faulting affect Red Mountain lithologies. The earliest faults are steep northwest-dipping semi-brittle shear zones that form prominent lineaments on Red Mountain. These structures include the Goldslide and Rick faults that displace the gold-silver zones. The structures have phyllitic foliations, cataclastic textures and exhibit right lateral sense of displacement with a normal component. The timing of displacement with respect to folding is uncertain. North to northwest trending, moderately to steeply southwest and northeast-dipping faults are developed throughout the Red Mountain area and are locally associated with mafic dikes. They cut the McAdam Point stock and all other structures, including northwest-dipping shear zones. The faults exhibit shallow dipping internal fabric, hydrothermal alteration and are associated with more steeply dipping hydrothermal veins suggesting a normal sense of displacement.



6.3 Deposit Types In the Skeena Mining Division the most significant metallic mineralization consists of gold-silver hydrothermal mineralization spatially and genetically related to Early Jurassic calc-alkaline intrusions and volcanic edifices. Subordinate porphyry-style molybdenum-gold mineralization with associated silver-lead-zinc veins is genetically related to Middle Eocene quartz-monzonite intrusions intruded along the eastern margin of the Coast Plutonic Complex. Both mineralization styles occur within the Red Mountain property. Porphyry-style molybdenum and gold mineralization is associated with the Tertiary McAdam Point Stock located in the southern portion of the property. Quartz sulphide veins occur throughout the stock and country rock and the most significant mineralization is restricted to within 25 metres of the contact. Although local high-grade gold across less than one meter widths are reported, cursory examination of these occurrences by Bond Gold apparently did not warrant further work (Vogt, 1991). The Red Mountain project is therefore primarily prospective for magmatic-related gold, silver and copper mineralization and other related hydrothermal deposits.

6.4 Mineralization All of the Mineral Resources estimated for the Red Mountain deposit occur in three (3) main zones (Marc, AV and JW zones) interpreted to have formed during a single geological event in the Early Jurassic but later separated by Tertiary extensional block faulting. They are located within a large gossanous area extending over much of Red Mountain and hosting several other gold-silver showings (141, Brad, MCEX, Darb, Cornica, Dicksito). The sulphide-rich gold-silver mineralization is closely related to the emplacement of the sub-volcanic and polyphased felsic Goldslide intrusions intruding the Lower Jurassic volcano-sedimentary sequence.

6.4.1 Geology of the Marc, AV and JW Zones In the Marc, AV and JW zones the gold-silver mineralization occurs in irregular sulphide-rich stockwork forming northwesterly trending crudely tabular zones located within the carapace of the Goldslide intrusion, in the Hillside porphyry sub-phase, in volcano-sedimentary rafts and in intrusive breccias. Taking into account the block faulting affects, the original mineralized sheet had an estimated strike length of approximately 600 to 700 meters, a dip length of approximately 100 to 200 meters and a true thickness varying between less than one to more than 40 metres. The gold and silver-bearing sulphide stockwork depicts complex internal patterns resulting from a staged hydrothermal system transgressing stratigraphy and involving repeated episodes of veining and breccia



development. Pyrite is the dominant sulphide with subordinate, locally important, pyrrhotite and sphalerite. The stockwork consists of pyrite microveins, coarse-grained pyrite veins, masses and breccia matrix developed in zones of strong muscovite alteration. Vein thickness ranges between less than ten (10) centimetres to eighty (80) centimetres. Vein spacing varies between two (2) to ten (10) veins per meter. The sulphide stockwork is typically surrounded by a thicker weakly auriferous zone of disseminated pyrite, pyrrhotite and locally sphalerite alteration. This alteration envelope displays a concentric zoning pattern, with pyrrhotite disappearing sharply away from the gold-silver stockwork, typically across less than a meter. The relationship with sphalerite remains elusive. This geological model implies a strong spatial and genetic relationship between the gold-silver stockwork mineralization and the Goldslide intrusions. As such, structural and geological controls on the emplacement (and regional distribution) of these Lower Jurassic intrusive bodies are very important exploration targeting tools within this district.

Figure 3: Relative Spatial Distribution of Auriferous Zones in the Red Mountain Gold deposit.



6.4.2 Geology of Zones 132 and 141 Zones 132 and 141 are located in proximity to the Marc, AV and JW zones. The gold mineralization has been delineated by a series of boreholes drilled under a crosscutting pattern. At a one (1) gpt gold cut-off the gold mineralization exhibits greater lateral continuity and reasonable shapes may be delineated using the parameters defined by Craig (2001). The gold mineralization presents similar geological features to the other auriferous mineralization. Gold grades are however on average lower than in the Marc, AV and JW zones. The one gpt grade shell encloses several higher grade gold intercepts but given the widely spaced drilling pattern, their geometry is too discontinuous to allow modelling reasonable three-dimensional shapes. Additional infill drilling is required which as the potential to increase the grade of the zones. Zone 132 is a gently west-dipping tabular auriferous sheet that represents the southern down-dip continuation of the AV and JW Zones. It occurs between sections 1425N and 1650N (local Mine Grid coordinates), up to 320 metres from the down-dip end of the AV and JW Zones. On vertical sections this auriferous zone measures between forty (40) to 200 metres in length and is between four (4) and ten (10) metres in thickness. A total of fourteen (14) boreholes tested Zone 132. Zone 132 can be sub-divided into at least four sub-zones (133, 135, 136 and 137). The 133 sub-zone likely represents the northern extension of the JW Zone. The other sub-zones occur in the hanging wall of the main 132 zone toward the southwest (Figure 3). Zone 141 is located approximately 280 metres into the hanging wall of and to the south of the JW zone (Figure 3). It occurs between sections 1300N and 1375N (Mine Grid). On vertical section the auriferous zone form an irregular oblong spherical object measuring between twenty (20) and sixty (60) metres in thickness by twenty (20) to seventy (70) metres. In total thirteen (13) boreholes tested this auriferous zone. The approximate Mine Grid coordinates of each of the auriferous zones considered in the present study are presented in Table 1.

Table 1: Mine Grid Location, Zones 132, 141, Red Mountain Gold Project, British Columbia.

Zone Easting Range Northing Range Elevation Range No. Blocks

141 4726 – 4798E 1294 – 1382N 1722 – 1810EL 3,097132all 4502 – 5194E 1418 – 1658N 1466 – 1690EL 13,670132 4750 – 5050E 1442 – 1658N 1466 – 1690EL 7,900133 5138 – 5194E 1642 – 1658N 1614 – 1650EL 202135 4502 – 4810E 1470 – 1506N 1522 – 1650EL 2,912136 4630 – 4838E 1418 – 1458N 1554 – 1674EL 1,528137 4714 – 4858E 1418 – 1458N 1578 – 1642EL 1,134



Figure 4: Top. Vertical section 1350N showing the position of Zone 141 relative to the AV Zone. Bottom. Vertical section 1450N showing the position of Zones 136, 137 and 132 relative to the AV Zone. See Figure 3 for Section location.



Figure 5: Vertical Section 1600N showing the position of Zone 132 relative to the JW Zone (see Figure 3 for section location). Note that Zone 132 represents the down-dip extension of the JW zone. In modelling Zone 132, SRK took care to close the limits of Zone 132 against that of the adjacent JW Zone.



7 Exploration The details about drilling, drilling procedures, sampling and assaying procedures, data verification and quality control and quality assurance programs have been discussed in details elsewhere (Craig, 2001 with further discussions in Craig, 2002). Seabridge did not conduct any additional drilling on this project since its acquisition in early 2002. There has been no change to this information since the publication of the Technical Report prepared by Craig (2002). The salient aspects of exploration work carried out at Red Mountain are summarized below.

7.1 Diamond Drilling The borehole database for the Red Mountain project comprises a total of four-hundred-and sixty-six (466) boreholes (BQ and NQ calibre) totalling approximately 134,800 metres. Four-hundred-and-six (406) holes (105,130 metres) were drilled by Bond and Lac Minerals between 1989 and 1994. Sixty (60) boreholes were drilled by Royal Oak in 1996. No further drilling has been done on this project since. The majority of this drilling (368 surface and underground boreholes) tested the Marc, AC, JW and other satellite auriferous zones. The Mineral Resource Estimate reported by Craig (2002) used a sub-set of 212 boreholes, 206 of which have been re-examined in details by NAMC in 2000. The Mineral Resource Estimate for Zones 132 and 141 is based on a total of seventy-eight (78) surface and underground boreholes. Core recovery was typically good. Ninety-three (93) percent of core recovery measurements indicate better than ninety (90) percent recovery (Craig, 2002). Borehole location data is referenced to two coordinate systems. A local Mine Grid system and a regional UTM coordinate system. The collar of all boreholes has been surveyed. Surveyed data include collar position and the azimuth and plunge of the borehole. All boreholes drilled after 1990 have been surveyed for deviation using Sperry Sun readings at variable intervals. Reading intervals were every 90 metres in 1990 to 1992 and between 15 and 60 metres in 1993 and 1994. Typically short underground holes were surveyed with only one reading at the end of the hole. Surveying data were verified by NAMC during the complete project review undertaken in 2000. Minor surveying inconsistencies for a few boreholes were corrected and boreholes without down-hole survey data were adjusted by calibrating against geological data from neighbouring holes.



SRK reviewed the surveying data for the area including Zones 132 and 141 and validated surveying information against available drilling information. In the opinion of SRK, the drilling data is considered reasonably accurate for the purpose of Mineral Resource estimation.

7.2 Sampling Approach and Methodology Standard sampling procedures were used in collecting core samples. Drill core samples were collected by mechanically splitting core in half over regular intervals. Sampling intervals was set at 1.5 metres between 1989 and 1992 regardless of geology and 1.0 metre during the 1993 and 1994 drilling programs following geological contacts. SRK is of the opinion that the sampling procedures used by previous project operators at Red Mountain were adequate.

7.3 Sample Preparation, Analyses and Security Prior to 1993 Lac Minerals and Bond submitted all assay samples to the Mineral Environments Laboratories located in North Vancouver, British Columbia. Routine industry standard sample preparation and assaying were used. Pulps (30 grams) were assayed for gold and silver by standard fire assay technique with atomic absorption finish. Sample assaying greater than seventeen (17) gpt gold were re-assayed using a gravimetric finish. In 1993 and 1994, Lac Minerals submitted all surface and underground samples to Eco-Tech Laboratories located Stewart, British Columbia. Gold and silver assays were performed using standard fire assay with an atomic absorption finish. Depending on the assay results, samples assaying above ten (10) gpt gold were re-assayed using a gravimetric finish, For samples assaying more than thirty (30) gpt gold a metallic screen assay was performed on the remaining sample material. SRK could not examine any documentation pertaining to procedures taken by past operators regarding sample security to prevent inadvertent contamination or mixing of samples and rendering active tampering as difficult as possible. However, SRK has no reason to believe that any active tampering took place during the collection, transport, storing, and delivery of assay samples to the assay laboratory. Check assaying was performed at one of two laboratories. Pulps for a total of eleven (11) percent of all samples assayed prior to 1993 were submitted to the Bondar Clegg Laboratories of North Vancouver, British Columbia. In 1993 and 1994 pulps and coarse rejects for approximately thirteen (13) percent of all samples were submitted to Chemex Laboratories of North Vancouver, British Columbia for re-assay. Gold and silver assays were performed using standard fire assay procedures on thirty (30) grams pulps with atomic absorption or gravimetric finish.



Additional check assays were also performed by NAMC in 2000 with an emphasis on the Marc, AV and JW zones. A selected suite of pulps and coarse rejects collected from the sample warehouse in Stewart British Columbia were submitted to Chemex Laboratories in North Vancouver, British Columbia for re-assaying. The analysis of check assay results presented by Craig (2002) suggests that secondary laboratories reported slightly different gold results, particularly at elevated gold grades. SRK reviewed check assay result data presented in Craig (2002) and concurs with the conclusion that check assay results are in reasonable agreement with original assay results despite more scatter at elevated grades, which is typical for this style of mineralization.

7.3.1 Quality Assurance and Quality Control Programs Analytical procedures were described in details by Craig (2002) who also reviewed at length the quality assurance and quality controls programs set forth during the collection of exploration drilling data on the Red Mountain project. SRK concurs with the analysis completed by Craig (2002) and is therefore of the opinion that those procedures were appropriate for this type of exploration project and perhaps, more importantly, that the procedures appear to have been strictly followed. SRK has no evidence to suggest that assaying results are biased. SRK is of the opinion that the assaying results are reliable. The quality control programs used during exploration at Red Mountain changed over time as exploration drilling yielded more encouraging results. Initially, quality control measures included primarily repeat assaying at a secondary laboratory. Commencing in 1993, Lac Mineral put in place a more stringent control program including inserting one of three CANMET gold Certified Reference Materials (“CRM”) within the sampling stream. The control program was further improved in 1994 when Lac Mineral used four project-specific pulp CRMs prepared by CDN Resource Laboratories of Delta British Columbia from the Red Mountain deposit and certified through round-robin analysis. Craig (2002) presents an analysis of the control program of 1994. SRK concurs with the conclusion that assay precision was generally good and that control measures taken during exploration programs at Red Mountain were according to industry standard at the time the information was collected.

7.3.2 Specific Gravity Data The specific gravity database contains a total of 4,283 determinations collected in two sampling programs. In 1993 and 1994, a total of 4,225 specific gravity measurements were collected by Lac Minerals on drill core submitted to the Eco-Tech Laboratories located Stewart, British Columbia as part of the assaying procedure. In 2002 Wheaton River Minerals collected an additional



fifty-eight (58) samples for bulk density analysis. Specific gravity varies primarily with the sulphide content as shown in Table 2 extracted from Craig (2002).

Table 2: Specific Gravity Data, Red Mountain Gold Project, 1993 and 1994 Sampling Program*.

Zone Number of Samples

Range of Values

Mean Specific Gravity

Pyrite content (%)

All samples 4283 1.44 - 4.12 2.86 N/A All within 2000 solids 1290 1.85 - 4.04 2.95 6.11 2000 Marc solid 1058 2.03 - 4.04 2.95 6.43 2000 AV solid 194 1.85 - 3.85 2.99 5.83 2000 JW solid 38 2.67 - 3.12 2.90 1.91 2000 solids - > 5.0 g/t Au 667 2.48 - 4.04 3.01 8.66 2000 solids - < 5.0 g/t Au 623 1.85 - 3.58 2.89 3.43

*Table extracted from Craig, 2002, Table 15.1..

7.4 Data Verification An investigation of drill hole collars and down hole surveying was conducted by SRK to validate the borehole database from Zones 132 and 141. SRK noticed that many drill hole traces using the UTM grid coordinates were different than when traced using the Mine Grid system. The collar and down hole survey data for a total of seventy-eight (78) boreholes were compared against surveying information contained on the paper drill logs for Zones 132 and 141 and peripheral areas within the Area of Interest. Discrepancies in borehole UTM azimuth bearing were noted in the database and relate to the incorrect assumption of north bearing (000 degrees) when no azimuth data is available (null value). The proper azimuth should be the rotation difference between the two grid systems used in the database. In addition SRK noted that the UTM azimuth table also inconsistently accounts for the 0.5 degree angle between the UTM grid and geographic north, resulting in a one (1) degree difference for many boreholes. These discrepancies were not corrected by SRK because this investigation only focused on a sub-set of the borehole database. The borehole UTM azimuth table should be corrected to properly account of the grid rotation. This study uses only the Mine Grid coordinate system which is not affected by this problem.

8 Adjacent Properties There is no adjacent property of interest.



9 Mineral Processing and Metallurgy A review of previous metallurgical test work was presented in Craig (2002). The Processing and Metallurgical aspects of the Red Mountain were also examined by SRK as part of the Preliminary Assessment Engineering Study (SRK 2003). The salient findings are summarized below. Extensive metallurgical test work was conducted at Brenda Process Technology’s Laboratories (“Brenda”) just prior to the Rescan Feasibility Study that was done in the mid 1994 for Lac Minerals. This work indicated that the Red Mountain deposit is amenable to whole-ore direct cyanidation for the extraction and recovery of gold and silver. The Brenda work indicated that the expected recovery of gold and silver using this process would average 89 percent and 81 percent respectively for the three samples in equal portions. Three different zones (Marc, AV and JW) were tested and the gold recoveries varied from eighty-four (84) to ninety-two (92) percent while silver recoveries varied from seventy-two (72) to eighty-five (85) percent. The AV zone was found to contain lower precious metal grades than the other two zones and the highest levels of tellurides and is clearly the most difficult of the three zones to treat, requiring high lime above saturation for best recovery and the use of aeration with atmospheric air to enhance recovery. High lime can be justified because of reduced antimony in the leachate but the oxygen is not required for the other two zones. Grinding test work was done by A.R. MacPherson Consultants Ltd. and Brenda. Both techniques showed a grinding work index of 17.4 kilowatt-hours per tonne (“kWh/t”) for the Marc zone from the Red Mountain deposit. Other tests indicated the work index would be just over nineteen (19) kWh/t. Additional SAG Power Index (SPI) test work was recommended to refine the design of the grinding circuit. Carbon test work indicated that good loading characteristics can be expected using CIP technology. In addition, base metal loadings on the carbon were low, indicating good performance on recovering the precious metals from the carbon can be expected. Detoxification test work was done by INCO Engineering and Technical Services using the patented SO2/air cyanide destruction process and gave normal results. Another test work program was completed by Beattie Consulting Ltd. in January 2001. The purpose of this study was to examine flotation as a process option because it could be done at a coarser size and produce a saleable concentrate.



The work was conclusive that rougher flotation recovery would be unlikely to exceed the recovery that could be obtained by direct cyanidation of a fine grind. In addition, the high sulphur content of the deposit made it impossible to achieve good recovery without recovering over twenty-five (25) percent of the weight as rougher concentrate and attempts to clean the rougher concentrate showed large losses in the cleaner tailings. The treatment of rougher concentrate could not be shown to operate economically, either by direct sale to a smelter or by fine grinding and cyanidation of the flotation concentrate. The economics of sale to a smelter would consume in the order of one third of the value contained in the concentrate, in shipping and smelting costs because of the high weight recovery. The alternative cyanidation of the float concentrate was economically unattractive because a second recovery loss in the leach tailings of five (5) percent would occur, in addition to the flotation loss of about ten (10) percent of the gold. From an operating perspective, flotation was found less attractive as well. In the event that the operators were not attentive on a 24-hour basis, large increments of recovery could be lost until the circuit stability was restored. This will not happen in a leach circuit. After reviewing all metallurgical data, SRK concluded that metallurgical recoveries estimated at ninety (90) percent for gold and eighty (80) percent silver could be achieve with a 1000 tonnes per day gold-silver mill fed from run-of-mine stockpiles. The mill process would include a normal two-stage SAG/Ball mill grinding circuit with high capacity thickening, cyanide leaching, carbon-in-pulp adsorption, carbon elution and regeneration, electro-winning and refining, and cyanide destruction with SO2 and air. It was proposed that mill tailings would be stored in an earth and rock constructed tailings dam (with water reclaim facilities) near the mill. The tailings facility, located in the Red Mountain cirque, follows the design used in the 1994 feasibility study. Additional studies were recommended by SRK to assess alternative tailings facility locations and designs which could materially reduce the capital cost of the tailings storage facility. There conceptual design of the side valley impoundment and the scoping level cost estimate is considered reasonable given the level of information available for the site. There are a number of potential opportunities that exist that could reduce the capital cost of the dams; including the final placement of cover, the use of HDPE as seepage control and limiting the freeboard volume through use of less conservative climatic data assumptions, and potentially consider constructing the dams of roller compacted concrete.



10 Mineral Resource Estimation

10.1 Introduction The current investigation concerns an area of interest that is located outside the area considered by Craig (2002). As a result the Mineral Resources that are estimated in the present study are not included in the previous Measured, Indicated and Inferred Mineral Resource Statement for the Marc, AV and JW zones of the Red Mountain gold deposit (Craig, 2002). The Area of Interest (“AOI”) pertaining to the present study comprises a sub-set of seventy-eight (78) boreholes encompassing essentially two (2) auriferous zones. Zone 132 represents the down-dip extension of Zone JW and is adjacent and contiguous to Mineral Resource blocks defined by Craig (2002), while Zone 141 represents a separate auriferous zone not contiguous with any other auriferous zones. For the present study, SRK followed the procedures described by Craig (2001 and 2002) in order to maintain consistency and comparability of the Mineral Resources for the Red Mountain project. The resource estimation work was carried out at the Toronto office of SRK between November 2004 and January 2005 with some preliminary modelling investigation work carried out earlier during the third and fourth quarter of 2004 following on a memorandum prepared by Threlkeld (2004).

10.2 Data Data used by SRK in estimating the Mineral Resources for Zones 132 and 141 include a sub-set of seventy-eight (78) boreholes totalling approximately 28,711 metres and primarily located between sections 1275N and 1675N (Mine grid system). Thirty-four (34) of these holes have intersected gold mineralization in Zones 132 and 141. The remaining forty-four (44) holes are peripheral to the Zones and were used to assist the interpretation of geological data. A detail listing of boreholes considered in this study is presented in Appendix B. Electronic data used in the present study are derived from the original Gemcom Red Mountain database (GCDBR1.mbd). This Microsoft Access database was converted in to a series of Microsoft Access databases within Mintec’s MineSight software package as shown in Table 3.



Table 3: Red Mountain Gold Project, British Columbia, Microsoft Access Tables Created by SRK from the Gemcom Database. Table No. of

RecordsExtracted descriptive fields Comment

RM_HEADER 466 HOLE-ID, LOC_MGX, LOC_MGY, LOC_MGZ, LENGTH

Drillhole collar data

RM_SURVEY 2,384 HOLE-ID, DISTANCE, AZ_MG, DIP Down hole survey data RM_DHAUAG_SG 49,771 HOLE-ID, FROM, TO, AU_FIRE,

AU_GRAV, AU_MET, AU_CHECK, AG_ASY, AG_CHECK, SG, LENGTH, BLOCKCODE

Drillhole assay data

RM_GEOL_2000 1,701 HOLE-ID, MODIFIER, FROM, LITH, TO 2000 re-logging (NAMC) RM_MINERALIZA 44,562 HOLE-ID, FROM, TO, PY, PO Mineralization data from

samplers RM_VEIN_2000 4,875 HOLE-ID, FROM, TO, PYMICRO

(microveinlets), PYPER (pyrite %), TOTPY (Total pyrite)

Vein study from 2000

RM_A_GEOLOGY 7,636 HOLE-ID, FROM, TO, LITHOLOGY, MODIFIER

Lithology data

In order to load lithology data into the RM_A_GEOLOGY table, additional data conditioning was completed in Microsoft Excel. ASCII dump files for borehole collars, down hole surveying, assays, and the various geology files were created and imported into MineSight. Names of some descriptive fields were abriviated (for example, BLOCKCODE to BCODE, AU_FIRE to AU_FIR, etc.). A new descriptive “AUUSE” field was created as explained further in section 10.4.1 Sample Statistics below.

10.3 Solid Body Modelling

10.3.1 Design of Modeling Criteria Modelling criteria used by Craig (2001 and 2002) were established from detailed geological and structural investigations carried out in 2000. Theses studies investigated the lithological and structural controls on the distribution of the gold mineralization, the nature of sulphide occurrences and the relationship of pyrite content to the gold grade. The salient findings of these studies suggest important modelling criteria as follows (after Craig, 2002): • Basic lithology, including major structural features, with appropriate

textural modifiers; • The limits of pyrite, and more rarely pyrrhotite, stockworking. These limits

are often, but not always coincident with a 1 g/t gold assay outline. Inside this outline, sulphide occurs as disseminations, microveinlets, planar and irregular veins and irregular masses. Average pyrite content in lower gold grade sections of the stockwork is at least 4%. Outside the stockwork limits,



sulphide occurs as disseminations and sparse microveinlets with average pyrite content of 1.5%;

• The shift from a pyrite-dominated stockwork to a pyrrhotite-dominated

alteration halo is sharp and often corresponds to a 1 g/t gold outline except in rare cases, where pyrrhotite abundance, style and gold content mimics the pyrite stockwork;

• The cumulative thickness of pyrite in a given interval has the best

correlation to gold grade regardless of the width or number of veins and represents the most important data that can be collected to constrain gold distribution. The data collected suggest that cumulative pyrite thickness could be used to delineate high and low grade domains;

• Brecciation of pyrite veins is also related to gold distribution and can be

measured by qualitative measurements, although in practical terms such measurements are time consuming and very subjective.

10.3.2 Solid Body Modelling Three dimensional solids were created for the pyrite-pyrrhotite stockwork or mineral zones using the following process: East-west vertical cross-sections looking Grid North were plotted at twenty-five (25) metres intervals between section 1275N and 1675N showing all surface and underground diamond drill holes. Primary lithology, colour-coded gold assay intervals and pyrite content were displayed along each drill hole trace. Geological or mineralization outlines were digitized on vertical sections using the following guidelines: Mineralization Outlines Gold mineralization outlines were based on the limits of significant pyrite and pyrrhotite mineralization. As described by Craig (2002), SRK found that the boundary of the pyrite stockwork is either very abrupt or gradational. Boreholes penetrating Zones 132 and 141 concerned by the present study were not re-logged as part of verification studies completed by NAMC in 2000. As a consequence, pyrite, pyrrhotite and gold and silver contents were used to develop the outlines. Solid body models created by Craig (2002) for the strockwork gold mineralization excluded areas based on the following information: • Areas where no “stockworking” was noted to be associated with gold

values. Although such occurrences are spatially associated with the auriferous sulphide stockworks, they are also very erratic and cannot be modeled with confidence;

• Isolated stockwork zones with no demonstrable continuity. These consist of

a drill hole intersection that could not reasonably be joined on section or in plan view to another intersection. As such, they could only be modelled as a small disk or spherically shaped body;



• Single intersections that could only be interpreted as small lobes of

“stockworking” on a single section. These lobes could not be modelled in any direction with confidence.

A few borehole intersections within Zone 132 possibly fall under one or another of Craig’s exclusion criteria. In addition, given the more widely spaced drilling data and the relatively poor understanding of fault displacement history in this portion of the Red Mountain deposit, a somewhat lower confidence is given to the interpretation of borehole data, therefore casting lower confidence in the geological continuity of the gold mineralization. Nonetheless, SRK is of the opinion that there is sufficient geological merit to support continuity of gold mineralization between borehole data. Gold mineralization outlines were digitized on the twenty-five (25) metres vertical cross sections as closed “polylines” that were snapped to borehole trace in two dimensions. Projection of boreholes in the center of each section is very close to its true three dimensional position. SRK chose to “snap” polylines to the section plan instead of its true three dimensional position to avoid complications resulting from very closely-spaced data, especially when drilling is off section. Craig (2002) opted for the more difficult three-dimensional snapping approach. All polylines were properly closed with an appropriate number of nodes. Polyline directions and endpoint locations were kept consistent for each zone. Each polyline surface area was validated. All gold mineralization outlines were linked together in three dimensions to create volume solids with their respective ends created usually by simple extrusions emulating sectional termination at 6.25 metres from the end section. All resultant three dimensional solid shapes were checked for openings, self-intersections and duplicate faces. The volumes of each three dimensional solid shape was calculated and their shape was visually inspected every four (4) metres as an additional validation steps. A rock code was assigned to each three dimensional solid shape as indicated in Table 4 below:

Table 4: Rock Code Assigned for Zones 132 and 141.

Zone Sub-Zone Rock/Block Code 132 132 132 132 133 133 132 134 134 132 135 135 132 136 136 141 141 141

The three dimensional solids were then used to code the block model so that each block (4 metres x 4 metres x 4 metres) that falls wholly or partly within the solid is assigned a rock code as shown in Table 4 above, regardless of how much of a given block falls within the shape. The percentage of each block in



the three dimensional solid is computed and stored in the three dimensional model to be used later to derive accurate volumes and tonnages. Geology Outlines Geology outlines in the areas of Zones 123 and 141 comprise three main lithologies: the Bedded Sequence, the Hillside Porphyry and Contact Intrusion Breccias. Narrow post mineralization “Andesitic” dikes were not modelled because these dikes cannot be reasonably interpreted at the current drilling spacing. In addition, poor resolution of post mineralization faults prevents accurate modelling and therefore these faults were not modelled even though they exert an influence on the shape of some gold mineralization outlines. In any event, given the scale of these features relative to the volumes concerned SRK does not consider these simplifications material. Gold mineralization outlines occur along or adjacent to the contact between the Hillside Porphyry and a portion of the Bedded Sequence, or very close to such a contact. Some of the strongest gold mineralization occurs in a lithology logged as “IB” for Intrusion Breccia. According to Lang (2000), this breccia type is “… defined as having fragments of one or more rock types encased in a matrix of intrusive rock” and commonly occurs at the contact between the Hillside Porphyry and the Bedded Sequence with the most abundant fragments being derived from this sequence. The geology outlines are mostly open polylines digitized on vertical cross sections to show the lateral continuity of the three main lithologies. According to Craig (2002), “statistical evaluation of the geology and stockwork models indicated that gold and silver mineralization cross-cut geology and host rock type had little or no effect on gold or silver emplacement. Resource interpolation was performed using stockwork outlines only.” SRK found that this is indeed the case but that there is always a spatial association between the presence of gold mineralization and the contact of Hillside Porphyry and what appear to be rafts of Bedded Sequence. On occasion, the auriferous mineralization appears to crosscut the lithologies at low angles. Ultimately, SRK also used only the three dimensional gold mineralization shapes to interpolate mineralization outlines.



10.4 Statistical Analysis

10.4.1 Sample Statistics The Red Mountain borehole database consists of the following: Boreholes 446 Gold Assays 49,771 Silver Assays 39,192 Multi-element ICP Assays 44,350 Whole Rock Assays 4,665 A total of forty-one (41) boreholes penetrate the mineralization outlines created for Zones 132 and 141. A few drill holes intersect the solids more than once. SRK accepts the study of Craig (2001 and 2002) that: “The original assays, as opposed to subsequent check assays or duplicates, were accepted for the resource calculation.” “… the gold assay technique used was dependent on the value obtained in the initial assay by FA-AA. If the initial result was over 10 g/t, the sample was re-assayed using a gravimetric finish. If the result was over 30 g/t, a metallics assay was performed. For resource estimation purposes, metallics results were given precedence over gravimetric results, which in turn were given precedence over AA results.” SRK created another descriptive field labelled AUUSE to store gold assay results used for resource estimation. This field was created in the MineSight assay file and was not transferred back to the original Gemcom Access database. Since gold is the primary metal of interest at Red Mountain, gold assays are generally always available for each sample from the three main gold zones (Marc, AV and JW), but away from these zones missing silver assays are assigned a null value in the database. These null values for silver were changed to zero assay values in the MineSight assay file, again without affecting the original Gemcom database. This is a more conservative approach than to simply allow neighbouring samples that are assayed for silver to be used for interpolation while un-assayed intervals are given no influence. Zero-grade intervals for silver more than likely have some silver content that remains unknown and therefore the resulting Mineral Resource estimate may somewhat underestimate silver grades. Each assay interval in the MineSight assay table was also assigned a rock code (132, 133, 135, 136, 137 or 141) without changing the original Gemcom database. All coded assays, including codes 101, 201, and 301 used by Craig (2001 and 2002) for the Marc, AV and JW Zones respectively, were



transferred into an Excel file named“dat207OC.xls”. The codes were used to control borehole compositing and ultimately grade interpolation. Minor changes were also made to some rock codes used by Craig (2001 and 2002) in boreholes intersecting the Marc, AV and JW zones (Table 5). Again, the original Gemcom database is unaffected.

Table 5: Rock Code Changed in Red Mountain Borehole Database.

Section Borehole From To Old Code New Code 1450N M93130 446.0 450.3 201 132 1450N 941110 132.0 137.0 201 132 1475N M93126 438.0 440.0 201 132 1550N 941146 135.5 143.4 301 132 1600N M93103 523.0 531.0 301 132 All changes were exported into an Excel file named “dat207OC.xls” so that the original Gemcom Access database can be changed if required. Descriptive sample statistics for the combined 132 Zones and Zone 141 are presented in Table 6 and 7, respectively. Null values are converted to “*” and zero grade values for gold and silver to a small number so that they can be converted to natural logarithms. Both sets of statistics come from samples contained within the mineralization outlines that are used to compute regular drillhole composites. The vast majority of sample is either 1.0 metre or 1.5 metres in length as shown in Figure 6. Only a few samples in Zone 132 are longer than 1.5 metres. Composites are calculated every 1.5 metres down hole starting at the uppermost assay interval within a zone. This distance is the same as used by Craig (2002). Residual composites smaller than 1.5 metres were retained, but are considered to introduce a statistically insignificant effect. The composite lengths histogram for Zones 132 and 141 is presented in Figure 6.



Table 6: Sample Statistics for the Combined 132 Zones.

Variable N N* Mean Median TrMean StDev SE Mean Minimum Maximum Q1 Q3AI 260 0 1.1092 1 1.1111 0.2353 0.0146 0.2 1.5 1 1.275AUUSE 260 0 3.925 1.82 2.615 11.897 0.738 0 182.66 1.1 3.157AUFIR 259 1 3.899 1.82 2.642 11.146 0.693 0.09 169.3 1.1 3.17AUGRA 21 239 23.86 14.2 15.75 38.84 8.48 9.98 191.8 11.08 19.04AUMET 2 258 106.5 106.5 106.5 107.7 76.2 30.3 182.7 * *AUCHK 0 260 * * * * * * * * *AGASY 260 0 6.31 0 2.06 21.73 1.35 0 203.3 0 1.4AGCHK 4 256 13.2 12.1 13.2 13.34 6.67 1.4 27.2 1.6 25.9SG 28 232 2.9086 2.86 2.9008 0.1394 0.0263 2.76 3.26 2.7925 3.01BCODE 260 0 141 141 141 0 0 141 141 141 141PY 246 14 3.846 3 3.282 4.161 0.265 0.2 20 1 5PO 228 32 5.112 3 4.515 5.042 0.334 0.2 30 2 7PYMIC 260 0 0 0 0 0 0 0 0 0 0PY% 0 260 * * * * * * * * *TOTPY 0 260 * * * * * * * * *LnAUUSE 259 1 0.6829 0.5988 0.6638 1.0165 0.0632 -2.4079 5.2076 0.0953 1.1537LnAUFIR 259 1 0.6838 0.5988 0.6655 1.0171 0.0632 -2.4079 5.1317 0.0953 1.1537LnAUGRA 21 239 2.809 2.653 2.707 0.643 0.14 2.301 5.256 2.404 2.947LnAUMET 2 258 4.309 4.309 4.309 1.271 0.899 3.41 5.208 * *LnAUCHK 0 260 * * * * * * * * *LnAGASY 100 160 1.384 0.915 1.354 1.674 0.167 -2.303 5.315 0.117 2.493LnAGCHK 4 256 1.88 1.94 1.88 1.535 0.767 0.336 3.303 0.449 3.25LnPY 246 14 0.8975 1.0986 0.912 0.9653 0.0615 -1.6094 2.9957 0 1.6094LnPO 228 32 1.2248 1.0986 1.2376 0.9312 0.0617 -1.6094 3.4012 0.6931 1.9459LnPYMI 0 260 * * * * * * * * *LnPY% 0 260 * * * * * * * * *LnTOTP 0 260 * * * * * * * * *

* After converting null values to « * » & zero assays in AUUSE and AGASY to 0.001 & log equivalents.

Table 7: Sample Statistics for Zone 141.

Variable N N* Mean Median TrMean StDev SE Mean Minimum Maximum Q1 Q3AI 260 0 1.1092 1 1.1111 0.2353 0.0146 0.2 1.5 1 1.275AUUSE 260 0 3.925 1.82 2.615 11.897 0.738 0 182.66 1.1 3.157AUFIR 260 0 3.876 1.82 2.633 11.13 0.69 -2 169.3 1.1 3.157AUGRA 260 0 0.089 -2 -1.562 12.897 0.8 -2 191.8 -2 -2AUMET 260 0 -1.166 -2 -2 11.618 0.721 -2 182.66 -2 -2AUCHK 260 0 -2 -2 -2 0 0 -2 -2 -2 -2AGASY 260 0 6.31 0 2.06 21.73 1.35 0 203.3 0 1.4AGCHK 260 0 -1.766 -2 -2 2.361 0.146 -2 27.2 -2 -2SG 43 232 2.9086 2.8600 2.9008 0.1394 0.0263 2.76 3.26 2.7925 3.0100BCODE 260 0 141 141 141 0 0 141 141 141 141PY 246 14 3.846 3 3.282 4.161 0.265 0.2 20 1 5PO 228 32 5.112 3 4.515 5.042 0.334 0.2 30 2 7PYMIC 260 0 0 0 0 0 0 0 0 0 0PY% 260 0 -1 -1 -1 0 0 -1 -1 -1 -1TOTPY 260 0 -1 -1 -1 0 0 -1 -1 -1 -1LnAUUSE 259 1 0.6829 0.5988 0.6638 1.0165 0.0632 -2.4079 5.2076 0.0953 1.1537LnAUFIR 259 1 0.6838 0.5988 0.6655 1.0171 0.0632 -2.4079 5.1317 0.0953 1.1537LnAUGRA 21 239 2.809 2.653 2.707 0.643 0.14 2.301 5.256 2.404 2.947LnAUMET 2 258 4.309 4.309 4.309 1.271 0.899 3.41 5.208 * *LnAUCHK 0 260 * * * * * * * * *LnAGASY 100 160 1.384 0.915 1.354 1.674 0.167 -2.303 5.315 0.117 2.493LnAGCHK 4 256 1.88 1.94 1.88 1.535 0.767 0.336 3.303 0.449 3.25LnPY 246 14 0.8975 1.0986 0.912 0.9653 0.0615 -1.6094 2.9957 0 1.6094LnPO 228 32 1.2248 1.0986 1.2376 0.9312 0.0617 -1.6094 3.4012 0.6931 1.9459LnPYMIC 0 260 * * * * * * * * *LnPY% 0 260 * * * * * * * * *LnTOTPY 0 260 * * * * * * * * *

* After converting null values to « * » & zero assays in AUUSE and AGASY to 0.001 & log equivalents.



210

300

200

100

0

AI

Freq

uenc

y

Histogram of Assay Interval (AI)

1.51.00.5

350

300

250

200

150

100

50

0

LENGTH (m)

Freq

uenc

y

Histogram of LENGTH

Figure 6: Assay Interval (top) and Composite Length (bottom) Histograms for Zones 132 and 141, Red Mountain Gold Deposit.



10.4.2 Composite Statistics Composites are computed as discussed in the previous section and their descriptive statistics are listed in Tables 8 and 9 for Zones 132 (combined) and 141, respectively. There are sufficient differences between the statistics for Zones 132 and 141 to warrant separate analysis. Silver has similar Coefficients of Variation (3.32 for the 132 Zones compared to 3.21 for Zone 141; Tables 8 and 9) but their means are quite different (2.98 gpt versus 6.34 gpt). There is greater statisticalal similarity for gold between both zones with a mean of 3.07 gpt for the 132 Zones and 3.75 gpt for Zone 141. Their Coefficient of Variation are 1.38 and 1.86, respectively (Tables 8 and 9). However, the geographic location and overall geometry of each zone are sufficiently different to warrant separate statistical analysis of the two data sets.

Table 8: Composite Statistics for the Combined 132 Zones. Variable N N* Mean Median TrMean StDev SE Mean Minimum Maximum Q1 Q3 COVAUUSE 176 0 3.072 1.925 2.57 4.23 0.319 0.13 46.47 1.228 3.22 1.38AUUSE trimmed 176 0 3.058 1.925 2.57 4.086 0.308 0.13 44 1.228 3.22 1.34

AGASY 176 0 2.976 0.315 1.09 9.883 0.745 0 72.33 0.05 1.4 3.32PY 176 0 2.859 2 2.401 3.641 0.274 -1 25 1 3.918 PO 176 0 2.312 2 1.983 3.06 0.231 -1 15.4 0.255 3 BCODE 176 0 134.2 135 134.16 2.12 0.16 132 137 132 136 LnAUUSE 176 0 0.687 0.6548 0.6968 0.9125 0.0688 -2.0402 3.8388 0.2049 1.1694 LnAUUSE trimmed 176 0 0.6867 0.6548 0.6968 0.9115 0.0687 -2.0402 3.7842 0.2049 1.1694

LnAGASY 133 43 -0.409 -0.357 -0.501 1.844 0.16 -2.996 4.281 -2.303 0.675 LnPY 155 21 0.8195 0.8459 0.8376 0.9254 0.0743 -1.772 3.2189 0.2852 1.3863 LnPO 136 40 0.8586 0.9821 0.9026 0.8862 0.076 -2.3026 2.7344 0.4323 1.3863

Table 9: Composite Statistics for Zone 141. Variable N N* Mean Median TrMean StDev SE Mean Minimum Maximum Q1 Q3 COVAUUSE 197 0 3.748 1.98 2.747 6.974 0.497 0.09 64.05 1.29 3.26 1.86AUUSE trimmed 197 0 3.548 1.98 2.747 5.335 0.38 0.09 44 1.29 3.26 1.50

AGASY 197 0 6.34 0 2.43 20.36 1.45 0 176.19 0 1.97 3.21PY 197 0 3.491 2.33 3.112 3.537 0.252 -1 17.33 1.33 4.33 PO 197 0 4.435 3 3.928 4.799 0.342 -1 21.67 1.45 6 BCODE 197 0 141 141 141 0 0 141 141 141 141 LnAUUSE 197 0 0.7622 0.6831 0.7563 0.9703 0.0691 -2.4079 4.1597 0.2546 1.1817 LnAUUSE trimmed 197 0 0.7584 0.6831 0.7563 0.9577 0.0682 -2.4079 3.7842 0.2546 1.1817

LnAGASY 80 117 1.475 1.335 1.502 1.692 0.189 -3.507 5.172 0.239 2.733 LnPY 188 9 0.9527 0.9821 0.957 0.8522 0.0622 -1.6094 2.8524 0.4253 1.4894 LnPO 177 20 1.252 1.203 1.2525 0.8717 0.0655 -1.1087 3.0759 0.6931 1.8453



A matrix of correlation coefficients for the composites for Zones 132 and 141 for gold, silver, pyrite and pyrrhotite is presented in Table 10. For the Marc, AV and JW zones, Craig (2002) found a low correlation between silver and gold assays (correlation coefficient of 0.24), and therefore separate variography and population statistics were applied for grade interpolation. Although gold and silver assays are slightly better correlated in zones 132 and 141 (coefficient of variation of 0.39 and 0.38, respectively) each metal is considered separately for variography.

Table 10: Correlation Matrix for Zones 132 and 141. Correlation for 141 and 132 Zones Correlation for Zone 141 Correlation for 132 Zones

AUUSE AGASY PY AUUSE AGASY PY AUUSE AGASY PY AGASY 0.394 AGASY 0.395 AGASY 0.384 PY 0.097 0.25 PY 0.064 0.221 PY 0.152 0.342 PO 0.027 -0.069 -0.115 PO 0.022 -0.11 -0.226 PO -0.013 -0.06 -0.008

10.5 Grade Capping Grade capping for the 141 and 132 Zones follows the practice of Craig (2001) whereby assay composites greater than 44 gpt gold are trimmed to that level and silver assays are cut to 220 gpt. Cumulative log probability plots for gold (Figure 7) and silver (Figure 8) assays show that there are no silver composites greater than 220 gpt in either zone, highest assay being 72 gpt in Zone 132 and 176 gpt Zone 141. Only three assay composites exceed 44 gpt (0.8 percent of the total number of composites), one in Zone 132 and two in Zone 141. Cumulative probability plots for gold (Figure 7) show that these three composites are outliers and that a top cut at forty-four (44) gpt may not be sufficient. The plots indicate that a cutting level at approximately twenty-five (25) gpt may be more appropriate for both zones. As discussed further below, SRK chose to maintain the top cut level at 44 gpt gor gold for both zones.



10.5.1 Average Zone Composites Table 11 presents a list of all borehole intersecting Zones 132 and 141 that were used for grade interpolation. Twenty-seven (27) intercepts in twenty-three (23) boreholes for Zone 132 and fourteen (14) intersections from twelve boreholes for Zone 131. Statistics for each zone are presented in Table 12. On average, Zone 141 is approximately twice the width of Zone 132. Pyrite content is approximately equivalent (3 and 3.2 percent, respectively) but average pyrrhotite content is higher in Zone 141 (4 percent relative to 2.4 percent in Zones 132).

Table 11: Statistics for Average Zone Composite, Zones 132 and 141, Red Mountain Project.

Statistic LENGTH AUUSE AUUSE cut AGASY PY PO132-137 Zones number 27 27 27 27 25 22mean 9.38 3.32 3.31 3.59 2.95 2.43minimum 3.60 1.20 1.20 0.00 0.23 0.60maximum 40.50 9.52 9.07 37.53 12.40 10.62STDEV 7.749 1.748 1.688 7.670 2.847 2.483 141 Zone number 14 14 14 14 14 14mean 20.61 3.52 3.37 6.17 3.20 3.96minimum 5.00 0.40 0.40 0.00 1.00 0.88maximum 53.50 8.99 6.92 22.73 5.04 12.15STDEV 15.493 1.976 1.571 6.758 1.046 3.022



0.1 1.0 10.0 100.0

1

510

20304050607080

9095

99

Data

Per

cent

AD* 2.225

Goodness of Fit

Log Probability Plot for AUUSE trimmed, 141 ZoneML Estimates - 95% CI

Location

Scale

0.758433

0.955284

ML Estimates

0.0 0.0 0.0 0.0 0.0 0.1 1.0 10.0 100.0 1000.010000.0

1

510

20304050607080

9095

99

Data

Per

cent

AD* 24.62

Goodness of Fit

Cumulative Log Probability Plot for AGASY, 141 ZoneML Estimates - 95% CI

Location

Scale

-2.13617

3.17238

ML Estimates

Figure 7: (Top) Log Probability Plot for Gold (trimmed to 44 gpt); (Bottom) Log Probability Plot for Silver Composites, Zone 141.



0.1 1.0 10.0 100.0

1

510

20304050607080

9095

99

Data

Per

cent

AD* 1.27

Goodness of Fit

Log Probability Plot for AUUSE trimmed, 132 ZonesML Estimates - 95% CI

Location

Scale

0.686671

0.908862

ML Estimates

0.00 0.00 0.01 0.10 1.00 10.00 100.00 1000.00

1

510

20304050607080

9095

99

Data

Per

cent

AD* 3.87

Goodness of Fit

Log Probability Plot for AGASY, 132 ZonesML Estimates - 95% CI

Location

Scale

-1.43409

2.40870

ML Estimates

Figure 8: (Top) Log Probability Plot for Gold (trimmed to 44 gpt), 132 Zones; (Bottom) Log Probability Plot for Silver, 132 Zones.



Table 12: Compilation of All Borehole Intercepts Considered for Mineral resource Estimation, Zones 132 and 141, Red Mountain Project.

ZONE HOLE SECTION FROM TO LENGTH AUUSE AGASY PY PO BCODE

1 141 931094 1300N 196.0 205.0 9.0 4.95 7.78 3.33 2.33 1412 141 941148 1300N 195.5 224.0 28.5 8.99 2.62 2.74 4.92 141

141 941148 1300N 195.5 224.0 28.5 6.92* 3 141 M93153 1300N 107.8 113.0 5.2 4.02 7.75 2.73 5.31 1414 141 M93153 1300N 123.0 128.0 5.0 2.89 12.18 3.70 4.00 1415 141 M93154 1300N 113.0 120.0 7.0 3.15 2.81 2.43 1.29 1416 141 M93154 1300N 124.0 154.0 30.0 2.33 1.50 2.00 2.57 1417 141 M94186 1325N 153.0 189.8 36.8 3.39 2.24 3.80 2.35 1418 141 M94191 1325N 174.0 227.5 53.5 3.00 8.04 3.44 4.58 1419 141 941100 1350N 186.0 191.0 5.0 0.40 0.15 1.00 2.20 141

10 141 M93141 1350N 170.5 200.0 29.5 4.50 15.68 3.69 0.88 14111 141 M94184 1350N 229.0 251.2 22.2 4.45 22.73 5.04 1.72 14112 141 M94185 1350N 198.7 235.5 36.8 3.07 0.00 4.80 12.15 14113 141 M94188 1375N 189.0 201.5 12.5 2.56 2.89 3.15 7.96 14114 141 M94199 1375N 181.5 189.0 7.5 1.62 0.00 3.00 3.20 141

15 137 941130 1425N 279.5 320.0 40.5 1.82 0.30 3.27 2.66 13716 137 M93114 1450N 442.0 448.0 6.0 3.31 0.62 1.96 1.04 13717 137 M94203 1450N 402.6 417.1 14.5 4.91 16.72 3.19 4.86 137

18 136 941130 1425N 243.0 254.5 11.5 1.95 0.19 3.87 4.22 13619 136 M93115 1450N 391.0 400.0 9.0 3.41 0.33 0.50 2.92 13620 136 M94203 1450N 380.5 387.2 6.7 3.39 5.58 1.37 2.63 136

21 135 M93115 1450N 368.5 375.0 6.5 1.20 0.78 0.23 1.27 13522 135 M93114 1475N 386.5 394.0 7.5 1.32 0.93 0.87 2.63 13523 135 941119 1500N 264.0 272.0 8.0 3.95 1.09 3.50 10.62 13524 135 M93135 1500N 393.5 420.5 27.0 1.53 0.81 1.94 0.78 135

25 133 941138 1650N 205.0 210.0 5.0 4.28 0.00 12.40 2.20 133

26 132 941110 1450N 132.0 137.0 5.0 3.74 4.42 8.80 2.00 13227 132 M93130 1450N 446.0 450.3 4.3 4.93 8.62 4.33 3.86 13228 132 M93126 1475N 435.0 442.0 7.0 2.38 2.59 1.64 2.86 13229 132 M9275 1500N 416.0 421.5 5.5 9.52 5.21 -1.00 -1.00 132

132 M9275 1500N 416.0 421.5 5.5 9.07** 30 132 M94164 1500N 463.0 471.8 8.8 3.76 0.05 2.29 1.70 13231 132 941141 1525N 124.0 129.5 5.5 5.18 37.53 5.86 1.18 13232 132 M93128 1525N 448.0 452.0 4.0 3.74 1.33 2.75 4.50 13233 132 M93129 1525N 455.0 467.0 12.0 2.69 3.18 5.21 -1.00 13234 132 941146 1550N 132.5 144.4 11.9 5.30 0.00 7.20 6.15 13235 132 M93140 1575N 485.0 494.0 9.0 2.06 1.82 1.33 1.56 13236 132 M93144 1575N 489.0 496.0 7.0 2.30 1.97 -1.00 -1.00 13237 132 M93103 1600N 523.0 531.0 8.0 3.88 2.80 0.77 0.60 13238 132 M94165 1600N 522.0 526.5 4.5 2.63 0.05 3.67 -1.00 13239 132 M94166 1600N 517.0 526.0 9.0 1.56 0.05 2.33 -1.00 13240 132 941154 1650N 191.8 195.4 3.6 1.58 0.00 1.45 8.22 13241 132 941161 1650N 311.0 317.0 6.0 3.42 0.00 1.00 2.25 132

Total 41 intersections in 35 holes * One assay interval from 210.0 to 211.0 grading 169.30 gpt gold cut to 44 gpt; ** One assay interval from 421.0 to 421.5 grading 58.05 gpt gold cut to 44 gpt.



10.6 Semi-Variogram Analysis Semi-variogram modelling and top-cut statistics were completed by Sinclair (2000) and used for the Mineral Resource estimate prepared by Craig (2002) for the Marc, AV and JW zones. Unlike that study, the data set for Zones 132 and 141 is much less extensive because of the more widely spaced drill data. Twelve (12) boreholes on four (4) vertical sections spaced at twenty-five (25) metres intersect Zone 141. A total of 1,739 1.5-metre composites were used by Craig (2002) in estimating the Mineral Resources for the Marc and AV Zones and only 82 for the JW Zone. By comparison there are only 167 and 197 1.5-metre composites available for Zones 132 and 141, respectively. Nonetheless, the geographic distribution and the overall geometry of the zones suggest that despite statistical similarity, each zone should be considered separately. Since each sub-zone in Zones 132 was only tested by three to four boreholes, there is clearly insufficient data to warrant separate modelling. All sub-zones were modelled as one group. Initially, SRK considered using parameters derived by Sinclair (2002) for estimating the Mineral Resources in Zones 132 and 141. Preliminary analysis showed however that semi-variograms drawn in the down-hole direction suggest a lower “nugget affect” because, on average, gold grades are lower in Zones 132 and 141, compared to that of the Marc, AV and JW Zones. As a result, three dimensional directional semi-variograms were constructed and subsequently modelled fore both zones.

10.6.1 Borehole Semi-variograms Direction of greatest variability across the mineralization is typically down-hole. In order to determine the nugget affect (Co) along that direction, separate down-hole semi-variograms were constructed for gold and silver in Zones 132 and 141 using a lag spacing of 1.5 metres to conform to the composite length. SRK chose pairwise relative semi-variograms as suggested by Sinclair (see Craig, 2002). With MineSight software, experimental down-hole semi-variogram uses a single three dimensional global semi-variogram for each of the four runs constructed. Table 13 shows results of modeled semi-variograms for all single spherical models. Borehole semi-variogram models are presented in Appendix C.

Table 13: Borehole Semi-Variogram Models, Zones 132 and 141, Red Mountain Project.

Zone Composite Item Co Nugget C1 Sill CT Total Range a

(metre) 141 AUUSE 0.15 0.385 0.535 4.5 132 AUUSE 0.15 0.309 0.459 2.7 141 AGASY 0.15 0.393 0.543 5.3 132 AGASY 0.15 0.881 1.031 9.7



10.6.2 Three Dimensional Directional Semi-variograms Directional pairwise relative semi-variograms were constructed for untransformed gold and silver data in Zones 132 and 141. Eight (8) vertical and horizontal angle combinations produce sixty-four (64) experimental semi-variograms and cover the right side of a hemisphere when starting horizontal and vertical angles are zero and each directional increment is set at 22.5 degrees. Horizontal and vertical windowing angles are thirty (30) degrees. A lag distance of twelve (12) metres was selected. Although semi-variograms can be modelled for some of the sixty-four (64) directions, SRK chose to model experimental semi-variograms conforming to the average directions of each of the auriferous zones. On east-west vertical cross section and in plan view the average orientations of the zones are as follows: Zones 132: In plan view, the major axis in plan trends from 000 to 045 degrees (Mine Grid coordinates) in the upper part of the zone, changing at depth to 020 to 045 degrees in azimuth and to 020 to 070 further at depth. On average the major axis trends at 045 degrees and dips at approximately 25 degrees to the northwest. Zone 141: The major axis in plan view strikes at between 000 to 045 degrees and on average at approximately 023 degrees. The dip varies from vertical on one section to 45 degrees to the west on the remaining three sections. Therefore, the average orientation of this zone was assumed at 023 degrees with a 45 degrees dip to the west. Results of the directional semi-variogram models are summarized in Table 14. Modelled directional semi-variograms for Zones 132 and 141 are presented in Appendix C. From these variograms four (4) models were selected for Kriging parameters (Table 15). The range of all semi-variograms is less than the borehole spacing which indicates that in order to interpolate grade in all resource blocks, the search distance will have to be increased to several times the indicated range. This will be considered further in the classification of Mineral Resource.

Table 14: Three Dimensional Directional Semi-variogram Models, Zones 132 and 141, Red Mountain Gold Project.

Zone Composite Co* C1* C2* CT* a1* (m) a2* (m) Axis Azimuth Dip141 AUUSE 0.15 0.376 0.526 37.3 major 022.5 0141 AUUSE 0.15 0.345 0.495 6.1 minor 112.5 45141 AUUSE 0.15 0.329 0.479 5.8 vert. 112.5 -45132 AUUSE 0.15 0.244 0.111 0.505 12.2 61.8 all 3D global141 AGASY 0.15 1.850 2.000 10.5 major 022.5 0141 AGASY 0.15 1.850 2.000 10.5 minor 112.5 45141 AGASY 0.15 1.294 1.444 6.4 vert. 112.5 -45132 AGASY 0.15 0.920 0.416 1.486 6.9 35.8 all 3D global

* Co is the Nugget Effect, C1 is the first sill, C2 is the second sill, CT is the total sill, a1 is the first range, a2 is the second range of influence.



Table 15: Kriging Parameters used for Grade Interpolation, Zones 132 and 141, Red Mountain Project.

Zone Kriging parameters

132 Zone Gold: nested isotropic spherical model Co = 0.15 C1 = 0.244 a1 major = a1 minor = a1 vertical = 12m C2 = 0.111 a2 major = a2 minor = a2 vertical = 62m 132 Zone Silver: nested isotropic spherical model Co = 0.15 C1 = 0.920 a1 major = a1 minor = a1 vertical = 7m C2 = 0.416 a2 major = a2 minor = a2 vertical = 36m 141 Zone Gold: Single anisotropic spherical model Co = 0.15 C1 = 0.35 a major @ 022.5ºAz/0º plunge = 37m a minor @ 112.5ºAz/45º plunge = 6m a vertical @ 112.5ºAz/-45º plunge = 6m 141 Zone Silver: single anisotropic spherical model Co = 0.15 C1 = 0.35 a major @ 022.5ºAz/0º plunge = 10m a minor @ 112.5ºAz/45º plunge = 10m a vertical @ 112.5ºAz/-45º plunge = 6m

10.6.3 Point Validation Point validation was performed using the composites of each zone to test the validity of inverse-distance weighted (“IDW”) interpolations versus ordinary kriging (“OK”). The composite search distances are the same as those described below. A comparison was made of search distances using true distances versus anisotropic search distances (Tables 16 and 17, respectively). Results show that OK is greatly affected and likely will overestimate the mean grade if an anisotropic search for composites is used. The IDW3 function does not appear to be affected by the type of search. OK without anisotropic search was selected as the preferred interpolation method for gold in this case. It is more conservative with estimation and results in lower Standard Deviations and, therefore, lowers variability of the estimates. It also will handle higher grade outliers by limiting and smoothing their influence. In section 10.5 above grade capping for gold was set at forty-four (44) gpt, but log-probability plots suggest that capping could be reduced as low as twenty-five (25) gpt. SRK chose to maintain the capping level at forty-four (44) gpt to conform to Craig (2001 and 2002). SRK feels more comfortable with the OK interpolation function because it will limit better the influence of the three (3) high grade outliers in the dataset for the Zones 132 and 141.



Table 16: Point Validation Statistics Gold, 141 Zone, True Distance Search Used. AUUSE IDW1 IDW1.5 IDW2 IDW2.5 IDW3 KRIGE

Mean of Differences -0.12944 -0.07295 -0.05558 -0.05325 -0.05539 -0.07787Std Dev of Differences 4.69782 4.62835 4.58513 4.55126 4.52676 4.52109 Mean of Calculated AUUSE 3.548 3.41808 3.47457 3.49193 3.49426 3.49212 3.46964Std Dev of Calculated AUUSE 5.335 2.71587 3.23607 3.44952 3.54760 3.60545 2.92407 ITEM MEAN STD.DEV. MINIMUM MAXIMUM MEDIAN SKEWNESS AUUSE 3.548 5.335 0.09 44.00 1.98 5.018 IDW1 3.418 2.716 1.05 24.88 2.66 4.342 IDW1.5 3.475 3.236 0.80 27.54 2.46 4.026 IDW2 3.492 3.449 0.46 27.99 2.40 3.844 IDW2.5 3.494 3.548 0.27 27.94 2.37 3.759 IDW3 3.492 3.606 0.20 27.88 2.34 3.721 KRIGING 3.470 2.924 0.86 22.23 2.53 3.622 KRG-VAR 0.346 0.028 0.260 0.434 0.340 1.262

Table 17: Point Validation Statistics Gold, 141 Zone, Anisotropic Search Used. AUUSE IDW1 IDW1.5 IDW2 IDW2.5 IDW3 KRIGE

Mean of Differences -0.01864 -0.03739 -0.04528 -0.05047 -0.05471 0.06291Std Dev of Differences 4.75173 4.65790 4.59570 4.55462 4.52775 4.64200 Mean of Calculated AUUSE 3.548 3.52887 3.51012 3.50223 3.49704 3.49280 3.61042Std Dev of Calculated AUUSE 5.335 3.34097 3.43231 3.50427 3.56244 3.60943 3.39513 ITEM MEAN STD.DEV. MINIMUM MAXIMUM MEDIAN SKEWNESS AUUSE 3.548 5.335 0.09 44.00 1.98 5.018 IDW1 3.529 3.341 0.61 29.35 2.64 4.117 IDW1.5 3.510 3.432 0.43 28.70 2.47 3.906 IDW2 3.502 3.504 0.32 28.27 2.40 3.801 IDW2.5 3.497 3.563 0.24 28.01 2.37 3.746 IDW3 3.493 3.609 0.19 27.89 2.34 3.716 KRIGING 3.611 3.395 0.70 26.74 2.56 3.816 KRG-VAR 0.359 0.041 0.261 0.496 0.348 1.827

Point validation for silver data in Zone 141 (Table 18) shows that grades are slightly better interpolated using OK interpolation rather than the IDW functions. Note that IDW3 compares more closely with OK in that both methods have high Standard Deviations, while IDW functions of lower power have progressively lower Standard Deviations. Overall, OK is still the better estimator. Point validation for gold in the combined 132 Zones (Table 19) shows that OK estimates the mean grade more closely than any of the IDW function and maintains the lowest Standard Deviation. The IDW functions tend to estimate the mean more closely with a lower Standard Deviation as the power of the function decreases. This indicates that IDW3 may not be the best IDW function for the 132 Zones. The point validation for silver in the combined 132 Zones (Table 20) shows that OK estimates the mean grade more closely than the IDW methods and with lower Standard Deviation. The IDW functions with progressively lower



powers tend to approximate the mean grade more closely and with slightly lower Standard Deviations than the IDW3 function.

Table 18: Point Validation Statistics Silver, 141 Zone, True Distance Search Used.

AGASY IDW1 IDW1.5 IDW2 IDW2.5 IDW3 KRIGEMean of Differences -0.62926 -0.30439 -0.20075 -0.18449 -0.19337 -0.10353Std Dev of Differences 18.90873 19.01595 19.00567 18.93807 18.87631 18.69769 Mean of Calculated AGASY 6.337 5.70800 6.03287 6.13651 6.15277 6.14389 6.23373Std Dev of Calculated AGASY 20.355 10.38724 12.68501 13.56017 13.89674 14.05949 13.95587 ITEM MEAN STD.DEV. MINIMUM MAXIMUM MEDIAN SKEWNESS AGASY 6.337 20.355 0.00 176.19 0.00 5.309 IDW1 5.708 10.387 0.08 60.05 2.03 3.480 IDW1.5 6.033 12.686 0.02 74.53 1.08 3.470 IDW2 6.137 13.561 0.01 80.05 0.69 3.503 IDW2.5 6.152 13.897 0.00 83.39 0.47 3.549 IDW3 6.144 14.060 0.00 85.50 0.33 3.588 KRIGING 6.234 13.956 0.02 85.59 0.89 3.691 KRG-VAR 0.850 0.158 0.514 1.332 0.867 1.024

Table 19: Point Validation Statistics Gold, Combined 132 Zones, True Distance Search Used.

AUUSE IDW1 IDW1.5 IDW2 IDW2.5 IDW3 KRIGE Mean of Differences -0.16026 -0.17255 -0.17826 -0.18155 -0.18302 -0.11241Std Dev of Differences 4.62841 4.69271 4.74915 4.80317 4.85367 4.61772 Mean of Calculated AUUSE 3.058 2.89758 2.88529 2.87958 2.87629 2.87482 2.94543Std Dev of Calculated AUUSE 4.086 2.22432 2.40305 2.53343 2.64583 2.74390 2.08997 ITEM MEAN STD.DEV. MINIMUM MAXIMUM MEDIAN SKEWNESS AUUSE 3.058 4.086 0.13 44.00 1.925 6.235 IDW1 2.897 2.225 0.46 20.14 2.245 3.478 IDW1.5 2.886 2.403 0.38 21.90 2.095 3.606 IDW2 2.880 2.534 0.33 23.43 2.055 3.862 IDW2.5 2.876 2.646 0.29 24.73 2.010 4.068 IDW3 2.874 2.744 0.27 25.86 1.980 4.228 KRIGING 2.946 2.090 0.56 16.66 2.395 3.768 KRG-VAR 0.197 0.007 0.188 0.235 0.195 2.543

Table 20: Point Validation Statistics Silver, Combined 132 Zones, True Distance Search Used.

AGASY IDW1 IDW1.5 IDW2 IDW2.5 IDW3 KRIGEMean of Differences 0.07359 0.10780 0.12253 0.12678 0.12670 0.03309Std Dev of Differences 8.16219 8.34654 8.42094 8.46246 8.49923 8.29120 Mean of Calculated AGASY 2.976 3.04995 3.08416 3.09889 3.10315 3.10306 3.00946Std Dev of Calculated AGASY 9.883 7.73641 8.58338 8.84675 8.95291 9.00967 7.51385 ITEM MEAN STD.DEV. MINIMUM MAXIMUM MEDIAN SKEWNESS AGASY 2.976 9.883 0.00 72.33 0.315 5.253 IDW1 3.050 7.737 0.00 47.84 0.635 4.017 IDW1.5 3.084 8.583 0.00 55.65 0.480 4.160 IDW2 3.099 8.847 0.00 59.14 0.420 4.252 IDW2.5 3.103 8.953 0.00 61.06 0.410 4.320



IDW3 3.103 9.010 0.00 62.31 0.400 4.369 KRIGING 3.009 7.514 0.00 46.98 0.680 4.043 KRG-VAR 0.240 0.017 0.223 0.286 0.228 0.948

10.7 Grade Interpolation

10.7.1 Block Model A three dimensional block model was created using MineSight software. The model represents the whole Red Mountain deposit and includes surface topography, all auriferous zones and their interpolated grade data. The original Gemcom block model was expanded to accommodate Zones 132 and 141 by extending its western boundary an additional 300 metres to the west and deepening it by another 100 metres. The north-south direction remains unchanged The block model is rotated forty-five (45) degrees counter-clockwise from the UTM grid so that the blocks are orthogonal to the drill sections and Mine Grid. All coordinates in the block model are Mine Grid coordinates. The Block model parameters conform with the original Gemcom block model as indicated in Table 21.

Table 21: Attributes of the Red Mountain Block Model.

Axis Direction

Gegraphic Orientation Axis Axis

Name Origin Block Size

No. of Blocks Length Coordinate

Range Easting 045º X Column 4500E 4 200 800 4500-5300 Northing 315º Y Row 1000N 4 200 800 1000-1800 Elevation Vertical Z Level 2000el. 4 150 600 2000-1400

Each block has a four (4) meters edge and the total number blocks is 6,000,000. This is nearly double the number of blocks in the original Gemcom model which had a total of 3,125,000 blocks. Gemcom block model data from the model named AUTRANSFORMEDOK (file name APRIL 19 TOTAL BLOCK EXTRACT & Resources.xls”; Craig, 2001) was loaded into the new MineSight block model (file name redm15.da3). This attributes of this model are presented in Table 22. The MineSight block model (redm15.da3) was dumped into and Ms Excel file (file name JANUARY2005 TOTAL BLOCK EXTRACT Model redm15da3.xls”) and its attributes are presented in Table 23. Gold grades were interpolated within the individual blocks using the coded rock model. During volumetric analysis, the volume of a block that falls within each mineralization solid is stored in the model and used to calculated accurate volumes and tonnages.



Table 22: Red Mountain GemCom Block Model Attributes.

Model Attribute Description Row Col X Easting Y Northing Z Elevation AUTRANS Au grade interpolation by ordinary kriging ROCK TYPE Block code to solid model type KV Kriging variance as calculated by Gemcom programSTD_DV Square root of KV POINTS Number of points used in AUTRANS estimate AG_TRANS Ag grade interpolation by ordinary kriging DISTANCE Anistropic distance to the nearest sample point Non-zero blocks: 16,558

Table 23: Red Mountain MineSight Block Model Attributes.

Model Item Description EAST(X) Easting NORTH(Y) Northing ELEV(Z) Elevation AUTR Au grade interpolation by ordinary kriging

ROCK Block code to solid model type; controls interpolation

KV Kriging variance as calculated by programs KSD Square root of KV PTS Number of points used in AUTR estimate

NCOMP Number of composites used to interpolate a AUTR block

AGTR Ag grade interpolation by ordinary kriging DIST Anisotropic distance to the nearest sample point XTRA1 XTRA2 ORE% Percentage of a block that falls within a solid AUID Au grade interpolation by IDW cubed AGID Ag grade interpolation by IDW cubed Non-zero blocks 33,331



To convert volumes into tonnages Craig (2001) used a tonnage factor of 3.0 which represent the average of 667 specific gravity determinations contained within the solids considered for resource estimation. There are forty-three (43) specific gravity determinations in the database for Zones 132 (average of 2.91) and twenty-eight (28) determinations for Zone 141 (average of 2.91). A bulk density of 2.91 was used to convert volumes into tonnages for all blocks in the model prepared by SRK for Zones 132 and 141. For comparative purpose, the MineSight block model includes provision to store additional interpolation data for gold and silver assays for comparative purposes. In this case an Inverse Distance Cubed methodology is also stored in the block model.

10.7.2 Grade Interpolation The interpolation parameters used to interpolate gold and silver grades in Zones 132 and 141 are presented in six tables in Appendix D. A separate table for each of the gold and silver interpolation data by ordinary kriging was created for each zone. Gold and silver grades were interpolated separately because of their different geostatistics. The remaining two tables present interpolation parameters for the inverse-distance weighting cubed (IDW3) routine for the combined gold and silver grades for the 141 and combined 132 Zones, respectively. For gold data, the kriging variance for each model, the number of composites used in the interpolation and the distance to the closest composite from each model block were also calculated. These items are not calculated for silver data. For the combined gold and silver interpolation using a IDW3 function, the number of composites used to estimate a block grade and the distance of the closest composite were stored as additional block model attributes. Primary search distances, limiting and maximum distances for composites for gold and silver by OK and IDW3 for Zones 132 are approximately double those for Zone 141 because of the wider drill hole spacing. An anisotropic composite search routine was used to create the IDW3 model. Octant search is employed by both routine (OK and IDW3) to “decluster” composite data.



10.8 Mineral Resource Classification The Mineral Resources estimated by SRK for Zones 132 and 141 of the Red Mountain gold project are classified in the Inferred Mineral Resource category according to the “CIM Standards on Mineral Resources and Reserves: Definitions and Guidelines” (August, 2000). The Mineral Resources were classified by D. Deptuck, P Geo an appropriate Qualified Person as defined by NI43-101. This classification is based primarily on the drilling spacing and the lack of underground exploration data, which lower the confidence in the lateral continuity of borehole data. This is consistent with the classification used by Craig (2002) for the Marc, AV and JW zones, where continuity was primarily established on the basis of geometry and grade with comparatively lesser importance given to structural features such as crosscutting faults. In the case of the Zone 132, SRK suspects that the sub-divisions into sub-zones may arise from possible faults. In classifying the Mineral Resources of the Marc, AV and JW Zones Craig (2001 and 2002) also used the Relative Kriging Standard Deviation (“RKSD”). Relative Kriging Standard Deviation was also calculated by SRK for Zones 132 and 141 to maintain consistency with the previous model. The RKSD’s for these zones are expected to be relatively low for two reasons: the lower average gold grades and the impact of a lower nugget effect derived from analysis of variography data. Because of the overriding effect of the drilling density and level of geological knowledge, SRK did not use RKSD to assist Mineral Resource Classification for Zones 132 and 141. At a zero gpt gold cut-off the Inferred Mineral Resources contained in Zones 132 and 141 is estimated at approximately 1,778,000 tonnes grading an average of 2.92 gpt gold and 3.22 gpt silver, or approximately 166,600 and 184,250 troy ounces, respectively (Table 24). The mineralization outlines were defined using a 1.0 gpt gold outline. A detail listing for each zone is presented in Appendix F along with the IDW3 model for comparison.

Table 24: Classified Inferred Mineral Resources at Various Gold Cut-off Grades, Zones 132 and 141, Red Mountain Project, SRK Consulting, January 2005.

Cut-off (gpt gold)

Tonnage(tonnes)

Gold* (gpt)t

Contained gold(Troy ounces)

Silver (gpt)

Contained silver(Troy ounces)

0.00 1,778,100 2.92 166,700 3.22 184,3001.00 1,728,950 2.97 165,200 3.31 183,7002.00 1,295,300 3.45 143,700 4.18 174,0003.00 773,600 4.08 101,400 5.53 137,6004.00 333,000 4.91 52,500 7.22 77,3005.00 114,700 5.89 21,700 10.25 37,8006.00 30,100 7.59 7,350 18.48 18,0007.00 13,700 8.95 3,950 19.49 8,6008.00 6,500 10.63 2,200 18.90 3,9509.00 3,700 12.37 1,450 19.90 2,350

* gold grades cut at 44 gpt.



Block Model Statistics are presented in Tables 25 and 26.

Table 25: Block Model Statistics for the Combined Zones 132.

Variable N Mean Median TrMean StDev SE Mean Minimum Maximum Q1 Q3

EAST 13676 4838 4846 4841 139.5 1.2 4502 5194 4746 4954NORTH 13676 1524.5 1506 1523.1 67 0.6 1418 1658 1478 1586ELEV 13676 1590 1598 1591.6 45.6 0.4 1466 1690 1562 1626AUTR 13676 2.8485 2.79 2.8024 1.2277 0.0105 0.64 11.01 1.84 3.72ROCK 13676 133.52 132 133.41 1.87 0.02 132 137 132 135KV 13676 0.42279 0.4 0.42034 0.09659 0.00083 0.06 0.7 0.36 0.46KSD 13676 0.64589 0.63 0.64577 0.0748 0.00064 0.24 0.84 0.6 0.68PTS 13676 6.9601 6 6.8082 2.9487 0.0252 2 16 6 9NCOMP 13676 6.914 6 6.7727 2.9033 0.0248 2 16 6 9AGTR 13676 2.0622 0.84 1.5593 3.1481 0.0269 0 39.33 0.07 2.56DIST 13676 30.307 29.1 29.723 15.079 0.129 0.4 99.2 19.1 40.2XTRA1 13676 -1 -1 -1 0 0 -1 -1 -1 -1XTRA2 13676 30.307 29.1 29.723 15.079 0.129 0.4 99.2 19.1 40.2ORE% 13676 52.747 54.1 52.963 35.966 0.308 1 100 16.1 90AUID 13676 2.7303 2.43 2.6444 1.3875 0.0119 0.55 10.66 1.64 3.6975AGID 13676 1.9079 0.73 1.2815 4.0434 0.0346 0 56.9 0.05 2.28

Table 26: Block Model Statistics for Zone 141.

Variable N Mean Median TrMean StDev SE Mean Minimum Maximum Q1 Q3

EAST 3097 4759.4 4758 4759.2 15.5 0.3 4726 4798 4746 4770NORTH 3097 1330.8 1326 1330.1 23.4 0.4 1294 1382 1314 1346ELEV 3097 1756.1 1754 1755.7 16.8 0.3 1722 1810 1742 1770AUTR 3097 3.2496 2.97 3.1088 1.5085 0.0271 0.5 28.08 2.36 3.72ROCK 3097 141 141 141 0 0 141 141 141 141KV 3097 0.27314 0.28 0.27558 0.06179 0.00111 0.06 0.53 0.26 0.3KSD 3097 0.51953 0.53 0.52433 0.06432 0.00116 0.24 0.73 0.51 0.55PTS 3097 13.909 14 13.98 3.963 0.071 3 24 11 17NCOMP 3097 10.489 10 10.424 4.238 0.076 2 22 7 13AGTR 3097 6.992 4.04 5.822 8.66 0.156 0 79.48 1.52 9.535DIST 3097 11.733 10.9 11.228 6.429 0.116 0.3 43.3 7.3 14.6XTRA1 3097 -1 -1 -1 0 0 -1 -1 -1 -1XTRA2 3097 11.917 10.9 11.371 6.709 0.121 0.3 44.3 7.3 14.7ORE% 3097 75.358 100 78.026 34.497 0.62 1 100 51.2 100AUID 3097 3.3867 2.57 2.9965 2.966 0.0533 0.42 38.12 1.83 4AGID 3097 7.27 1.74 4.772 13.954 0.251 0 105.55 0.23 7.16

11 Other Relevant Data SRK is not aware of additional relevant data pertaining to the present investigations of Zones 132 and 141 of the Red Mountain Project.



12 Summary and Conclusions Surface and underground exploration carried out between 1984 and 2002 has identified interesting hydrothermal gold and silver mineralization in the Red Mountain area hosted in Upper Triassic and Lower Jurassic rocks. The gold and silver mineralization is associated with strong pyrite and pyrrhotite mineralization and exhibits a strong structural and lithological relationship with a distinctive suite of felsic dikes. Previous studies have demonstrated the magmatic-hydrothermal character of this mineralization and that the felsic dikes exert a strong control on its distribution. Several distinct bodies of gold and silver mineralization have been delineated by exploration drilling. These include, the Marc, AV, JW, AV Tails, 132 and 141 zones. A Mineral Resource estimate was prepared for the Marc, AV and JW zones but did not consider satellite auriferous zones (Craig, 2002). This Mineral Resource estimate was disclosed in a Technical Report prepared for Seabridge Gold Inc in 2002 (Craig, 2002). A review of drilling data completed by SRK indicates reasonable confidence in the lateral continuity of the gold-silver mineralization in two satellite zones (132 and 141) to support a Mineral Resource estimate. In December and January 2005, SRK revised the interpretation of the borehole geology and constructed a Mineral Resource model for Zones 132 and 141. This Mineral Resource model for Zones 132 and 141 excludes areas considered by Craig (2002). Solid body models were created by SRK to encompass the gold and silver mineralization above a one (1) gpt gold cut-off. After statistical and geostatistical modelling, SRK interpolated gold and silver grades into an expanded block model by ordinary kriging. Volumes were converted to tonnages by applying a tonnage factor of 2.91 which correspond to the mean of forty-eight (48) specific gravity determinations from samples within the Mineral resources volumes. The Mineral Resources are classified into the Inferred Mineral Resource category primarily on the basis of borehole spacing. The Mineral Resources were estimated in accordance with the requirements of Canadian Securities Administrators (National Instrument 43-101) and in accordance with the “Canadian Institute of Mining, Metallurgy and Petroleum Standards on Mineral Resources and Mineral Reserves Definition Guidelines” (August 2000). Previously, Mineral Resources for the Marc, Av and JW Zones of the Red Mountain Project were reported at a zero gpt gold cut-off (Craig, 2002). In 2003, for the Preliminary Assessment Engineering Study, SRK re-stated the Mineral Resources for the Marc, AV and JW zones at a six (6) gpt gold cut-off. For Zones 132 and 141, the gold mineralization outlines were defined using a one (1) gpt gold cut-off. With the widely spaced drill data available, it is not



possible to define continuous regular shapes at higher gold cut-off. In this context SRK is of the opinion that the Mineral Resources for Zones 132 and 141 are appropriately stated using a one (1) gpt gold cut-off as indicated in Table 27.

Table 27: Inferred Mineral Resource Statement*, Zones 132 and 141, Red Mountain Project, British Columbia. SRK Consulting January 2005.

Zone Tonnage(tonnes)

Gold (gpt)**


Silver (gpt)


Zone 141 434,300 3.31 46,200 6.94 96,900 132 740,600 3.15 75,000 1.86 44,300133 12,600 4.06 1,600 0.00 0135 309,200 1.76 17,500 0.90 8,900136 129,000 2.94 12,200 2.09 8,700137 103,300 3.80 12,600 7.51 24,900Sub-total Zones 132 1,294,700 2.86 119,000 2.09 86,800

Total Inferred 1,729,000 2.97 165,200 3.31 183,700

* Reported at a 1 gpt gold cut-off. ** gold grades cut at 44 gpt.



13 Recommendations Although the gold and silver mineralization found in Zones 132 and 141 exhibits on average a lower gold grade compared to that of the Marc, AV and JW zones, SRK considers these auriferous zones nonetheless attractive exploration targets warranting additional drilling. The confidence in the geological interpretation presented for Zones 132 and 141 could be improved by selective re-logging of available boreholes as was conducted by NAMC for the bulk of the Marc, AV and JV Zones borehole data. In this process, SRK also recommends conducting additional sampling and assay verifications to validate further the assay database collected by previous project operators. Subsequently, additional infill drilling is certainly warranted to test the proposed geological model, validate historical drilling data and possibly improve the delineation the auriferous zones at a higher cut-off gold grade. At the present, the drilling information is simply not dense enough to support construction of mineralization outlines at a higher cut-off grade. In this context, although a significant number higher grade blocks exist within the one (1) gpt gold envelope modelled by SRK, continuous shapes cannot be reasonably defined without additional drilling data. Therefore, SRK recommends that future drilling target these higher grade areas to confirm the interpretation proposed here and possibility expand areas of “higher grade” gold mineralization. Finally, Craig (2002) also formulated similar recommendations for additional drilling to improve the delineation of Zones JW and AV Tails. In re-examining the Red Mountain project database, SRK briefly reviewed drilling data for other gold occurrences in the vicinity of the deposit. These occurrences have been tested by few boreholes and each should be re-evaluated as part of a comprehensive exploration program for this gold project. In conclusion, SRK is of the opinion that there is reasonable potential to expand the Mineral Resource base of the Red Mountain gold project with additional exploration drilling. To achieve a successful outcome, SRK recommends that the future drilling program also re-evaluate all other occurrences already known around the main resource area.



14 References

Alldick, D.J., 1993. Geology and Metallogeny of the Stewart Mining Camp, Northwestern British Columbia. British Columbia Ministry of Energy, Mines and Petroleum Resources, Bulletin 85, 105 p.

Craig, D. L., 2002, Red Mountain Project, British Columbia, Canada, Technical Report, report prepared for Seabridge Resources Inc., 82 pages.

Craig, D. L., 2001, Red Mountain Project, Stewart, B.C. Canada, 2001 Resource Estimate, North American Metals Corp. Report, 2 Vols.

Deptuck, R., 2004, Red Mountain Gold Project Targets – Progress Report No.2 on Findings by SRK Consulting (Corrected Version), SRK Consulting memo to R. Fronk, cc J-F Couture, SRK Consulting, 1 page, plus 2 MS Excel tables.

Deptuck, R., 2004, Red Mountain Gold Project Targets – Progress Report on Findings by SRK Consulting, SRK Consulting memo to R. Fronk, cc J-F Couture, SRK Consulting, 12 pages, including figures.

Greig, C.J., Anderson, R.G., Daubeny, P.H., and Bull, K.F. 1994. Geology of the Cambria Icefield Area, Northwestern British Columbia. Geological Survey of Canada, Open File 2931.

Lang, J. R., 2000, Geological Controls on Gold Ores in the Marc, AV and JW Zones, Red Mountain, British Columbia, Lang Geoscience Inc. report prepared for North American Metals Corp., 53 pages.

Rhys, D. AS., Stieb, M., Frostad, S.R., Swanson, C.L., and Prefontaine, M.A., 1995. Geology and Setting of the Red Mountain Gold-Silver Deposits, Northwestern British Columbia. In: Porphyry Deposits of the Northwestern Cordillera of North America. C.I.M.M. Special volume 46, pp. 811-828.

Sinclair, A.J. (2001):Summary Report Re Data Analysis and Semivariogram Modeling (OK) on Marc and AV Zones. Prepared for North American Metals Corp. 5p.

SRK Consulting, 2004. Red Mountain Tailings Options Srudy. Draft report prepared for Seabridge Gold Inc, March 2004.

SRK Consulting, 2004. Reclamation Plan for the Red Mountain Project,British Columbia. Report prepared for Seabridge Gold Inc, February 2004.



SRK Consulting, 2004. Results of 2003 Field Investigations, Red Mountain Project, British Columbia. Report prepared for Seabridge Gold, February 2004.

SRK Consulting, 2003, Preliminary Assessment of Exploration Potential of the Red Mountain project, SRK Consulting memorandum to K. Reipas, 9 pages.

SRK Consulting, 2003. Red Mountain Engineering Study. Prepared for Seabridge Gold Inc., 130 pages.

Thon, M. and Thon, L., 1998, Red Mountain Deposit Geostatistical Model, Royal Oak Mines Inc. report, 1 Vol.

Threlkeld, W., 2004, Exploration Potential at Red Mountain, BC, Seabridge Gold Inc. memorandum/report to R. Fronk, 5 pages plus appendix.



APPENDIX A

List of Mineral Titles Red Mountain Gold Project, British Columbia.



Red Mountain Gold Project, British Columbia, Mineral Title Information Obtained from The ClaimGroup managing mineral claims on behalf of Seabridge (January 21, 2005).

Tenure_ID Name Type NTS Size (hectares)

Size (unit)

Recorded Date Expiry Date

250331 Montreal No. 1 2-post Claim 104-A-04-E 25 1 27-Jan-1975 27-Jan-2006250332 Montreal No. 2 2-post Claim 104-A-04-E 25 1 27-Jan-1975 27-Jan-2006250333 Montreal No. 3 2-post Claim 104-A-04-E 25 1 27-Jan-1975 27-Jan-2006250334 Montreal No. 4 & 5 2-post Claim 104-A-04-E 25 1 27-Jan-1975 27-Jan-2006250335 Montreal No. 6 2-post Claim 104-A-04-E 25 1 27-Jan-1975 27-Jan-2006250336 Montreal No. 7 2-post Claim 104-A-04-E 25 1 27-Jan-1975 27-Jan-2006250781 Kim No. 1 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250782 Kim No. 2 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250783 Kim No. 3 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250784 Kim No. 4 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250785 Kim No. 5 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250786 Kim No. 6 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250787 Kim No. 7 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250788 Kim No. 8 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250789 Kim No. 9 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250790 Kim No. 10 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250791 Kim No. 11 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250792 Kim No. 12 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250793 Kim No. 13 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005250794 Kim No. 14 2-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2006250795 Pam 1 4-post Claim 104-A-04-E 500 20 26-Sep-1979 26-Sep-2006250796 Pam 2 4-post Claim 104-A-04-E 25 1 26-Sep-1979 26-Sep-2005251627 Bon Accord No. 2 2-post Claim 104-A-04-E 25 1 19-Jan-1987 19-Jan-2010251628 Bon Accord No. 3 2-post Claim 104-A-04-E 25 1 19-Jan-1987 19-Jan-2006251629 Bon Accord No. 4 2-post Claim 104-A-04-E 25 1 19-Jan-1987 19-Jan-2006251630 Bon Accord No. 5 2-post Claim 104-A-04-E 25 1 19-Jan-1987 19-Jan-2010251631 Bon Accord No. 6 2-post Claim 104-A-04-E 25 1 19-Jan-1987 19-Jan-2010251632 Bon Accord No. 7 2-post Claim 104-A-04-E 25 1 19-Jan-1987 19-Jan-2010251633 Bon Accord No. 8 2-post Claim 104-A-04-E 25 1 19-Jan-1987 19-Jan-2010251660 Bon Accord 2-post Claim 104-A-04-E 25 1 16-Feb-1987 16-Feb-2010251661 Bon Accord No. 1 2-post Claim 104-A-04-E 25 1 16-Feb-1987 16-Feb-2010251662 Bon Accord No. 9 2-post Claim 104-A-04-E 25 1 16-Feb-1987 16-Feb-2010251663 Bon Accord No. 10 2-post Claim 104-A-04-E 25 1 16-Feb-1987 16-Feb-2010252153 Hrothgar 4-post Claim 104-A-04-E 500 20 11-Jul-1988 11-Jul-2006 252217 Willoughby 3 4-post Claim 104-A-04-E 500 20 21-Sep-1988 21-Sep-2005252943 Dixie 1 4-post Claim 104-A-04-E 450 18 15-Jul-1989 15-Jul-2005 252944 Dixie 2 4-post Claim 104-A-04-E 375 15 15-Jul-1989 15-Jul-2005 252945 Dixie 3 4-post Claim 104-A-04-E 375 15 15-Jul-1989 15-Jul-2005 252946 Dixie 4 4-post Claim 104-A-04-E 450 18 15-Jul-1989 15-Jul-2005 252990 Lisa 1 4-post Claim 104-A-04-E 500 20 12-Aug-1989 12-Aug-2005252991 Lisa 2 4-post Claim 104-A-04-E 500 20 12-Aug-1989 12-Aug-2005252992 Lisa 3 4-post Claim 104-A-04-E 500 20 12-Aug-1989 12-Aug-2005252993 Lisa 4 4-post Claim 104-A-04-E 500 20 12-Aug-1989 12-Aug-2005252994 Lisa 5 4-post Claim 104-A-04-E 375 15 12-Aug-1989 12-Aug-2005252995 Lisa 6 4-post Claim 104-A-04-E 500 20 12-Aug-1989 12-Aug-2005252996 Lisa 7 4-post Claim 104-A-04-E 500 20 12-Aug-1989 12-Aug-2005252997 Lisa 8 4-post Claim 104-A-04-E 375 15 12-Aug-1989 12-Aug-2005253082 Janine 1 4-post Claim 104-A-04-E 400 16 8-Sep-1989 8-Sep-2005 253083 Janine 2 4-post Claim 104-A-04-E 300 12 8-Sep-1989 8-Sep-2005 253084 Janine 3 4-post Claim 104-A-04-E 500 20 8-Sep-1989 8-Sep-2005 253085 Janine 4 4-post Claim 104-A-04-E 500 20 8-Sep-1989 8-Sep-2005 253105 Vera 3 4-post Claim 104-A-04-E 200 8 17-Sep-1989 17-Sep-2006253106 Vera 4 4-post Claim 104-A-04-E 450 18 16-Sep-1989 16-Sep-2005253108 Vera 7 4-post Claim 104-A-04-E 200 8 16-Sep-1989 16-Sep-2005253109 Sarah 3 4-post Claim 104-A-04-E 150 6 15-Sep-1989 15-Sep-2005253110 Sarah 4 4-post Claim 104-A-04-E 50 2 15-Sep-1989 15-Sep-2005



Tenure_ID Name Type NTS Size (hectares)

Size (unit)

Recorded Date Expiry Date

253111 Sarah 5 4-post Claim 104-A-04-E 100 4 15-Sep-1989 15-Sep-2005253112 Sarah 6 4-post Claim 104-A-04-E 300 12 15-Sep-1989 15-Sep-2005253114 Sarah 8 4-post Claim 104-A-04-E 300 12 15-Sep-1989 15-Sep-2005253115 Sarah 9 4-post Claim 104-A-04-E 500 20 15-Sep-1989 15-Sep-2005253119 Vera 1 4-post Claim 104-A-04-E 500 20 16-Sep-1989 16-Sep-2005253131 Vera #10 4-post Claim 104-A-04-E 500 20 24-Sep-1989 24-Sep-2005253158 Oro I 4-post Claim 104-A-04-E 450 18 16-Sep-1989 16-Sep-2006253159 Oro II 4-post Claim 104-A-04-E 450 18 16-Sep-1989 16-Sep-2007253160 Oro III 4-post Claim 104-A-04-E 300 12 16-Sep-1989 16-Sep-2008253161 Oro IV 4-post Claim 104-A-04-E 500 20 23-Sep-1989 23-Sep-2006253162 Oro V 4-post Claim 104-A-04-E 500 20 23-Sep-1989 23-Sep-2007253163 Oro VI 4-post Claim 104-A-04-E 500 20 23-Sep-1989 23-Sep-2008253172 Sarah I 4-post Claim 104-A-04-E 500 20 26-Sep-1989 26-Sep-2005253173 Sarah II 4-post Claim 104-A-04-E 375 15 26-Sep-1989 26-Sep-2005253236 Vera 5 4-post Claim 104-A-04-E 100 4 15-Sep-1989 17-Sep-2005253778 Montreal No. 8 2-post Claim 104-A-04-E 25 1 22-Mar-1990 22-Mar-2006255098 Gold Spot 2-post Claim 104-A-04-E 25 1 21-Sep-1966 21-Sep-2006320189 Sabina 1 4-post Claim 104-A-04-E 300 12 3-Aug-1993 3-Aug-2005 320735 Oro Fr. Fractional Claim 104-A-04-E 0 1 6-Sep-1993 6-Sep-2006 320737 Theresa 4-post Claim 104-A-04-E 500 20 2-Sep-1993 2-Sep-2005 320867 Janet 1 4-post Claim 104-A-04-E 125 5 14-Sep-1993 14-Sep-2005320868 Janet 2 4-post Claim 104-A-04-E 125 5 14-Sep-1993 14-Sep-2005320869 Windy 4-post Claim 104-A-04-E 75 3 14-Sep-1993 14-Sep-2005320870 Anita Fr. Fractional Claim 104-A-04-E 0 1 14-Sep-1993 14-Sep-2005320929 Michaela 4-post Claim 104-A-04-E 150 6 30-Aug-1993 30-Aug-2005320930 Ren 4-post Claim 104-A-04-E 125 5 2-Sep-1993 2-Sep-2005 320932 Stimpy 4-post Claim 104-A-04-E 150 6 2-Sep-1993 2-Sep-2005 320992 Sandra Fr. Fractional Claim 104-A-04-E 0 1 6-Sep-1993 6-Sep-2005 321028 Sharon Fr. Fractional Claim 104-A-04-E 0 1 7-Sep-1993 7-Sep-2005 321029 Rose 4-post Claim 104-A-04-E 75 3 20-Sep-1993 20-Sep-2005321646 Kim Fr. Fractional Claim 104-A-04-E 0 1 12-Oct-1993 12-Oct-2005324637 Desi 1 4-post Claim 104-A-04-E 100 4 27-Mar-1994 27-Mar-2005324638 Desi 2 4-post Claim 104-A-04-E 100 4 27-Mar-1994 27-Mar-2005328212 Pamvera Fr. Fractional Claim 104-A-04-E 0 1 18-Jul-1994 18-Jul-2005 328214 Bon Fr. Fractional Claim 104-A-04-E 0 1 18-Jul-1994 18-Jul-2005 338971 Bromley 4-post Claim 104-A-04-E 150 6 17-Aug-1995 17-Aug-2005340214 Dixon Fr. Fractional Claim 104-A-04-E 0 1 10-Sep-1995 10-Sep-2005343046 Vermillion #1 4-post Claim 104-A-04-E 100 4 18-Jan-1996 18-Jan-2006343047 Vermillion #2 4-post Claim 104-A-04-E 300 12 18-Jan-1996 18-Jan-2006395135 Gold Valley 1 4-post Claim 104-A-04-W 300 12 14-Jul-2002 14-Jul-2005 395136 Gold Valley 2 4-post Claim 104-A-04-E 300 12 14-Jul-2002 14-Jul-2005 395137 Otter 1 4-post Claim 104-A-04-E 300 12 14-Jul-2002 14-Jul-2005 395138 Otter 2 4-post Claim 104-A-04-E 300 12 14-Jul-2002 14-Jul-2005 396491 CB-1 4-post Claim 103-P-09-E 400 16 21-Sep-2002 21-Sep-2005404734 Windsor 2-post Claim 103-P-92-E 25 1 21-Jul-2003 21-Jul-2005 404735 Windsor No. 2 2-post Claim 103-P-92-E 25 1 21-Jul-2003 21-Jul-2005 404736 Laura 2-post Claim 103-P-92-E 25 1 21-Jul-2003 21-Jul-2005 404737 Last Chance 2-post Claim 103-P-92-E 25 1 21-Jul-2003 21-Jul-2005 404738 Raven No. 1 2-post Claim 103-P-92-E 25 1 21-Jul-2003 21-Jul-2005 404739 Raven No. 2 2-post Claim 103-P-92-E 25 1 21-Jul-2003 21-Jul-2005 404740 Raven No. 3 2-post Claim 103-P-92-E 25 1 21-Jul-2003 21-Jul-2005 404741 Raven No. 4 2-post Claim 103-P-92-E 25 1 21-Jul-2003 21-Jul-2005 404742 Raven Fr. 2-post Claim 103-P-92-E 25 1 21-Jul-2003 21-Jul-2005 404743 Windsor Fr. 2-post Claim 103-P-92-E 25 1 21-Jul-2003 21-Jul-2005 Total 110 20,600 832



APPENDIX B

List of Boreholes Considered in The Modelling of Zones 132 and 141,

Red Mountain Gold Project, British Columbia.



List of boreholes from the Red Mountain Gold Project considered in the Mineral Resource estimation of Zones 132 and 141.

Borehole ID East North Elev. Length (metres) Comment

9012 4625.99 1318.63 1884.23 151.50 Peripheral 931090 4940.60 1249.42 1821.17 169.77 Peripheral 931094 4948.14 1299.97 1822.35 249.33 931095 4948.29 1299.99 1821.51 279.50 Peripheral 941100 4948.00 1299.22 1821.91 274.32 Peripheral 941101 4947.91 1299.21 1822.04 271.27 Peripheral 941102 4948.03 1299.16 1821.60 248.41 Peripheral 941109 5005.06 1450.49 1788.37 224.03 Peripheral 941110 5004.61 1450.47 1788.37 227.08 Peripheral 941111 4984.33 1400.62 1797.61 295.66 Peripheral 941112 4984.20 1400.65 1797.36 304.80 Peripheral 941113 4984.19 1400.58 1798.18 341.68 941114 4987.14 1400.58 1797.09 204.52 Peripheral 941119 5003.89 1500.07 1779.00 368.81 941130 4985.45 1400.53 1797.16 396.24 Peripheral 941132 5002.05 1549.84 1771.30 249.94 Peripheral 941135 4996.22 1659.58 1755.70 301.50 941136 4998.07 1659.47 1756.15 295.35 941137 4996.58 1659.57 1755.83 312.12 941138 4997.45 1659.54 1755.64 306.32 941139 4997.11 1659.17 1755.69 421.84 941141 5009.79 1525.16 1775.92 228.30 Peripheral 941142 5006.56 1475.38 1785.12 171.91 Peripheral 941146 5001.22 1549.93 1771.23 280.78 941147 4996.12 1597.18 1760.79 357.53 Peripheral 941148 4948.19 1300.04 1822.11 350.82 941149 4995.07 1660.84 1755.92 396.24 Peripheral 941150 4997.66 1660.46 1755.78 338.63 Peripheral 941151 4996.28 1661.11 1755.72 462.69 Peripheral 941152 4995.27 1660.38 1755.90 245.36 941153 4995.07 1660.37 1755.82 282.55 941154 4994.68 1660.34 1756.00 221.89 941161 4993.48 1660.15 1755.93 414.53 M9024 4926.47 1254.14 1966.72 265.79 Peripheral M9029 4874.29 1216.53 1907.00 211.80 Peripheral M9041 4977.08 1281.68 2005.50 389.53 Peripheral M9054 5028.83 1407.39 2096.46 419.59 Peripheral M9165 4865.03 1327.54 1987.61 439.52 Peripheral M93097 4866.09 1300.95 1968.06 303.89 Peripheral M93101 4922.25 1551.19 2127.53 632.46 Peripheral M93103 4888.30 1600.35 2110.34 922.63 M93111 4482.50 1395.21 1869.88 298.70 Peripheral M93112 4482.02 1395.26 1869.88 340.46 Peripheral M93114 4475.11 1489.08 1910.68 632.16 M93115 4474.94 1489.09 1910.63 563.88 M93120 4863.94 1352.96 2001.02 441.96 Peripheral M93121 4863.78 1353.05 2000.76 524.26 Peripheral M93126 4882.58 1500.83 2092.11 609.30 M93128 4703.80 1496.89 1990.61 623.32 M93129 4703.87 1496.87 1990.65 595.58 Peripheral



Borehole ID East North Elev. Length (metres) Comment

M93130 4945.64 1451.04 2097.03 597.10 M93135 4374.37 1505.95 1906.68 528.21 M93139 4596.09 1353.08 1891.98 365.15 M93141 4663.79 1355.75 1909.39 459.54 M93143 4664.27 1355.77 1909.11 244.75 Peripheral M93144 4710.89 1591.80 2019.73 618.75 M93153 4680.40 1301.77 1885.45 237.34 M93154 4680.36 1301.80 1885.20 294.43 M93156 4680.40 1301.77 1885.62 203.45 Peripheral M94164 4595.98 1495.49 1965.80 555.65 Peripheral M94165 4624.81 1598.10 1986.52 595.88 Peripheral M94166 4624.73 1598.11 1986.50 551.69 M94184 4818.93 1341.25 1973.85 428.24 M94185 4819.23 1341.27 1974.50 409.61 M94186 4673.81 1326.64 1900.65 379.48 M94187 4673.71 1326.66 1901.22 333.76 Peripheral M94188 4682.47 1369.92 1919.36 385.57 M94191 4605.44 1327.30 1885.66 269.75 M94192 4605.27 1327.27 1885.60 271.27 Peripheral M94193 4627.98 1408.30 1924.35 362.71 Peripheral M94194 4631.81 1288.86 1856.13 286.51 Peripheral M94195 4631.36 1288.85 1856.37 213.97 Peripheral M94196 4631.18 1288.85 1856.00 252.98 Peripheral M94197 4637.31 1252.13 1830.16 259.08 Peripheral M94198 4586.44 1373.88 1897.24 289.56 Peripheral M94199 4682.67 1370.82 1919.87 359.66 M94203 4598.47 1495.41 1965.48 545.59 M94204 4598.70 1495.38 1965.52 551.69 Peripheral

TOTAL 78 holes 28,711.42

34 holes Zones 132 - 141 44 holes Peripheral



APPENDIX C

Borehole Semi-Variograms and Directional Semi-Variograms, Zones 132 and 141, Red Mountain Gold Project, British Columbia.



Figure 9: Borehole Semi-variograms, Zones 132. Top. AUUSE, 3D global combined (file dat301.lb). Bottom. AGASY, 3D global combined, (file dat301.ld).



Figure 10: Borehole Semi-variograms, Zone 141. Top. AUUSE, 3D global combined (file dat301.la). Bottom. AGASY, 3D global combined, (file dat301.lc).



Figure 11: Top. 132 Zone, directional semi-variogram AUUSE, 3D global, (file dat303.lc). Bottom. 132 Zone, directional semi-variogram AGASY, 3D global, (file dat303.le)



Figure 12: Top. 41 Zone, directional semi-variogram AUUSE, vertical axis 112.5/-45, (file dat303.lf). Bottom. directional semi-variogram AGASY, major axis 22.5/0, (file dat303.ld)



Figure 13: Top. 141 Zone, directional semi-variogram AGASY, minor axis 112.5/45, (file dat303.ld). Bottom. Directional semi-variogram AGASY, vertical axis 112.5/-45, (file dat303.lg).



APPENDIX D

Interpolation Parameters Used in Grade Interpolation, Zones 132 and 141, Red Mountain Gold Project, British Columbia.



Ordinary Kriging Parameters Used to Interpolate Gold Grades, Zone 141.

KRIGING OF 3-D BLOCK VALUES FOR AUTR IOP2 4 Max # of composites per octant IOP3 1 = 3-D spherical search IOP4 1= geologic matching, match one item IOP6 0=Use true distance IOP7 2 = Min # of comps for interpolation IOP12 1=Octant search IOP16 32 = Max.# of composites for interpolating a block IOP19 3 = Max.# of composites per hole IOP20 0=Store variance PAR1 60m = Primary X-search distance PAR2 60m = Primary Y-search distance PAR3 15m = Primary Z-search distance PAR4 60m = Limiting search distance PAR7 60m = Max distance to closest point PAR8 60m = Max distance to project single composite IOP17 0=Ordinary kriging CMD NUG 0.15 CMD SPH 0.35 37.3 6.1 5.8 22.5 0. 45. ITM1 AUTR AUUSE CALC KRIGE ITM2 KV Block error ITM3 ROCK Block limit ITM4 ROCK BCODE Match model ITM5 BCODE RANGE 140.5 141.5 ITM6 DIST Block calc rings ITM7 PTS Block calc #comp CMD Block limit ROCK 141 Composites from file9 REDM09.DA2 Composite ITEMS TO BE RETRIEVED: EAST

NORTH ELEV. AUUSE BCODE REF# Model ITEMS TO BE STORED: AUTR KV DIST

PTS VARIOGRAM PARAMETERS : NUGGET = 0.15000

TYPE : SPHER C(1) = 0.35000 RANGES: RNOR = 37., REST = 6. RUP = 6. ANGLES: ROTN = 22.5, DIPN = 0.0, DIPE = 45.0 SILL = 0.50000

COORDINATES OF MINE MODEL FILE REDM15.DA3

XMIN, XMAX, DX, NX= 4500.0 5300.0 4.0 200 YMIN, YMAX, DY, NY= 1000.0 1800.0 4.0 200 ZMIN, ZMAX, DZ, NZ= 1400.0 2000.0 4.0 150

Quadrants/octants are based on actual coordinates. Block Discretization in X, Y, Z = 4. 4. 1. Block Variance = 0.23784



Ordinary Kriging Parameters Used to Interpolate Silver Grades, Zone 141

KRIGING OF 3-D BLOCK VALUES FOR AGTR IOP2 4 Max # of composites per octant IOP3 1 = 3-D spherical search IOP4 1= geologic matching, match one item IOP6 0=Use true distance IOP7 2 = Min # of comps for interpolation IOP12 1=Octant search IOP16 32 = Max.# of composites for interpolating a block IOP19 3 = Max.# of composites per hole IOP20 Variance not stored) PAR1 60m = Primary X-search distance PAR2 60m = Primary Y-search distance PAR3 15m = Primary Z-search distance PAR4 60m = Limiting search distance PAR7 60m = Max distance to closest point PAR8 60m = Max distance to project single composite IOP17 0=Ordinary kriging CMD NUG 0.15 CMD SPH 1.85 10.5 10.5 6.4 22.5 0. 45. ITM1 AGTR AGASY CALC KRIGE ITM2 ROCK Block limit ITM3 ROCK BCODE Match model ITM4 BCODE RANGE 140.5 141.5 CMD Block limit ROCK 141 Composites from file9 REDM09.DA2 Composite ITEMS TO BE RETRIEVED: EAST

NORTH ELEV. AGASY BCODE REF# Model ITEMS TO BE STORED: AGTR VARIOGRAM PARAMETERS : NUGGET = 0.15000

TYPE : SPHER C(1) = 1.85000 RANGES: RNOR = 10., REST = 10. RUP = 6. ANGLES: ROTN = 22.5, DIPN = 0.0, DIPE = 45.0 SILL = 2.00000






Ordinary Kriging Parameters Used to Interpolate Gold Grades, Zones 132.

KRIGING OF 3-D BLOCK VALUES FOR AUTR IOP2 4 Max # of composites per octant IOP3 1 = 3-D spherical search IOP4 1= geologic matching, match one item IOP6 0=Use true distance IOP7 2 = Min # of comps for interpolation IOP12 1=Octant search IOP16 32 = Max.# of composites for interpolating a block IOP19 3 = Max.# of composites per hole IOP20 0=Store variance PAR1 100m = Primary X-search distance PAR2 60m = Primary Y-search distance PAR3 30m = Primary Z-search distance PAR4 150m = Limiting search distance PAR7 150m = Max distance to closest point PAR8 150m = Max distance to project single composite IOP17 0=Ordinary kriging CMD NUG 0.15 CMD SPH 0.244 12.2 12.2 12.2 45. 0. 25. CMD SPH 0.111 61.8 61.8 61.8 45. 0. 25. ITM1 AUTR AUUSE CALC KRIGE ITM2 KV Block error ITM3 ROCK Block limit ITM4 ROCK BCODE Match model ITM5 BCODE RANGE 131.5 137.5 ITM6 DIST Block calc rings ITM7 PTS Block calc #comp CMD Block limit ROCK 132 133 135 136 137 Composites from file9 REDM09.DA2 Composite ITEMS TO BE RETRIEVED: EAST

NORTH ELEV. AUUSE BCODE REF# Model ITEMS TO BE STORED: AUTR KV DIST

PTS VARIOGRAM PARAMETERS : NUGGET = 0.15000

TYPE : SPHER C(1) = 0.24400 RANGES: RNOR = 12., REST = 12. RUP = 12. ANGLES: ROTN = 45, DIPN = 0.0, DIPE = 25.0 TYPE : SPHER C(2) = 0.11100 RANGES : RNOR = 62., REST = 62., RUP = 62. ANGLES : ROTN = 45.0, DIPN = 0.0, DIPE = 25.0 SILL = 0.50500






Ordinary Kriging Parameters Used to Interpolate Silver Grades, Zones 132.

KRIGING OF 3-D BLOCK VALUES FOR AGTR IOP2 4 Max # of composites per octant IOP3 1 = 3-D spherical search IOP4 1= geologic matching, match one item IOP6 0=Use true distance IOP7 2 = Min # of comps for interpolation IOP12 1=Octant search IOP16 32 = Max.# of composites for interpolating a block IOP19 3 = Max.# of composites per hole IOP20 Variance not stored) PAR1 100m = Primary X-search distance PAR2 60m = Primary Y-search distance PAR3 30m = Primary Z-search distance PAR4 150m = Limiting search distance PAR7 150m = Max distance to closest point PAR8 150m = Max distance to project single composite IOP17 0=Ordinary kriging CMD NUG 0.15 CMD SPH 0.92 6.9 6.9 6.9 45. 0. 25. CMD SPH 0.416 35.8 35.8 35.8 45. 0. 25. ITM1 AGTR AGASY CALC KRIGE ITM2 ROCK Block limit ITM3 ROCK BCODE Match model ITM4 BCODE RANGE 131.5 137.5 CMD Block limit ROCK 132 133 135 136 137 Composites from file9 REDM09.DA2 Composite ITEMS TO BE RETRIEVED: EAST

NORTH ELEV. AGASY BCODE REF# Model ITEMS TO BE STORED: AGTR VARIOGRAM PARAMETERS : NUGGET = 0.15000

TYPE : SPHER C(1) = 0.92000 RANGES: RNOR = 7., REST = 7. RUP = 7. ANGLES: ROTN = 45.0, DIPN = 0.0, DIPE = 25.0 TYPE : SPHER C(2) = 0.41600 RANGES : RNOR = 36., REST = 36., RUP = 36. ANGLES: ROTN = 45.0, DIPN = 0.0, DIPE = 25.0 SILL = 1.48600






Inverse-Distance Weighting Cubed Parameters Used to Interpolate Gold and Silver Grades, Zones 141.

I D W cubed INTERPOLATION OF 3-D BLOCK VALUES FOR AUID and AGID IOP2 4 Max # of composites per octant IOP3 1 = 3-D spherical search IOP4 1= geologic matching, match one item IOP6 0=Use true distance IOP7 2 = Min # of comps for interpolation IOP12 1=Octant search IOP16 32 = Max.# of composites for interpolating a block IOP19 3 = Max.# of composites per hole PAR1 60m = Primary X-search distance PAR2 60m = Primary Y-search distance PAR3 15m = Primary Z-search distance PAR4 60m = Limiting search distance PAR5 3. = Inverse distance power PAR7 60m = Max distance to closest point PAR8 60m = Max distance to project single composite CMD SEARCH 40. 40. 10. 22.5 0. 45. ITM1 AUID AUUSE CALC INVWT ITM2 AGID AGASY CALC INVWT ITM3 ROCK Block limit ITM4 ROCK BCODE Match model ITM5 BCODE RANGE 140.5 141.5 ITM6 XTRA2 Block calc rings ITM7 NCOMP Block calc #comp CMD Block limit ROCK 141 Composites from file9 REDM09.DA2 Composite ITEMS TO BE RETRIEVED: EAST

NORTH ELEV. AUUSE AGASY BCODE REF# Model ITEMS TO BE STORED: AUID AGID XTRA2

NCOMP COORDINATES OF MINE MODEL FILE REDM15.DA3


Quadrants/octants are based on actual coordinates. NOTE: ANISOTROPIC SEARCH IS USED



Inverse-Distance Weighting Cubed Parameters Used to Interpolate Gold and Silver Grades, Zones 132.

I D W cubed INTERPOLATION OF 3-D BLOCK VALUES FOR AUID and AGID IOP2 4 Max # of composites per octant IOP3 1 = 3-D spherical search IOP4 1= geologic matching, match one item IOP6 0=Use true distance IOP7 2 = Min # of comps for interpolation IOP12 1=Octant search IOP16 32 = Max.# of composites for interpolating a block IOP19 3 = Max.# of composites per hole PAR1 100m = Primary X-search distance PAR2 60m = Primary Y-search distance PAR3 30m = Primary Z-search distance PAR4 150m = Limiting search distance PAR5 3. = Inverse distance power PAR7 150m = Max distance to closest point PAR8 150m = Max distance to project single composite CMD SEARCH 100. 100. 30. 45. 0. 25. ITM1 AUID AUUSE CALC INVWT ITM2 AGID AGASY CALC INVWT ITM3 ROCK Block limit ITM4 ROCK BCODE Match model ITM5 XTRA2 Block calc rings ITM6 NCOMP Block calc #comp ITM7 BCODE RANGE 131.5 137.5 CMD Block limit ROCK 132 133 135 136 137 Composites from file9 REDM09.DA2 Composite ITEMS TO BE RETRIEVED: EAST

NORTH ELEV. AUUSE AGASY BCODE REF# Model ITEMS TO BE STORED: AUID AGID XTRA2

NCOMP COORDINATES OF MINE MODEL FILE REDM15.DA3


Quadrants/octants are based on actual coordinates. NOTE: ANISOTROPIC SEARCH IS USED



APPENDIX E

Classified Mineral Resources at Various Gold Cut-off Grades and Tabulated by Zones,

Zones 132 and 141, Red Mountain Gold Project, British Columbia.



Red Mountain Gold Project, British Columbia, Inferred Mineral Resources in Zones 132 and 141, Cut Ordinary Kriging Model, SRK Consulting, January 2005.

Zone Cut-off (gpt Gold)

Tonnage (tonnes)

Gold (gpt) (AUID*)


Silver (gpt) (AGID)


132 0.00 758,500 3.10 75,600 1.82 44,400 1.00 740,600 3.15 75,100 1.86 44,400 2.00 634,400 3.43 70,000 2.15 43,800 3.00 404,700 3.91 50,900 2.80 36,500 4.00 156,500 4.60 23,200 3.08 15,500 5.00 29,500 5.69 5,400 3.25 3,100 6.00 4,000 8.11 1,000 8.91 1,150 7.00 2,800 8.98 800 11.48 1,050 8.00 2,300 9.30 700 11.31 850 9.00 1,200 10.08 400 11.34 450133 0.00 12,600 4.06 1,600 0.00 0 1.00 12,600 4.06 1,600 0.00 0 2.00 12,600 4.06 1,600 0.00 0 3.00 12,600 4.06 1,600 0.00 0 4.00 5,800 4.22 800 0.00 0135 0.00 340,100 1.69 18,400 0.86 9,400 1.00 309,200 1.76 17,500 0.90 8,900 2.00 83,200 2.44 6,500 0.93 2,500 3.00 6,000 3.64 700 1.35 250 4.00 1,000 4.48 150 1.50 50 5.00 100 5.12 20 1.70 5136 0.00 129,000 2.94 12,200 2.09 8,700 1.00 129,000 2.94 12,200 2.09 8,700 2.00 87,400 3.59 10,100 3.04 8,550 3.00 56,800 4.13 7,550 3.11 5,650 4.00 31,400 4.84 4,900 1.90 1,900 5.00 20,100 5.01 3,250 0.52 350137 0.00 103,300 3.80 12,600 7.51 24,900 1.00 103,300 3.80 12,600 7.51 24,900 2.00 91,400 4.07 12,000 8.44 24,800 3.00 76,300 4.37 10,700 9.14 22,400 4.00 48,700 4.89 7,650 12.41 19,400 5.00 20,000 5.52 3,550 15.85 10,200 6.00 1,000 6.26 200 19.52 600 7.00 100 7.13 25 19.84 50141 0.00 434,600 3.30 46,200 6.93 96,800 1.00 434,300 3.31 46,100 6.94 96,800 2.00 386,300 3.51 43,500 7.60 94,400 3.00 217,200 4.28 29,900 10.43 72,800 4.00 89,600 5.51 15,900 14.04 40,400 5.00 45,000 6.59 9,550 16.70 24,200 6.00 25,100 7.55 6,100 19.97 16,100 7.00 10,900 8.96 3,150 21.54 7,550 8.00 4,200 11.36 1,550 23.08 3,100 9.00 2,500 13.42 1,100 23.83 1,900TOTAL 0.00 1,778,100 2.92 166,700 3.22 184,300 1.00 1,728,950 2.97 165,200 3.31 183,700 2.00 1,295,300 3.45 143,700 4.18 174,000 3.00 773,600 4.08 101,400 5.53 137,600 4.00 333,000 4.91 52,500 7.22 77,300 5.00 114,700 5.89 21,700 10.25 37,800 6.00 30,100 7.59 7,350 18.48 18,000 7.00 13,700 8.95 3,950 19.49 8,600 8.00 6,500 10.63 2,200 18.90 3,950 9.00 3,700 12.37 1,450 19.90 2,350

* Gold grades cut at 44 gpt gold.



Red Mountain Gold Project, British Columbia, Inferred Mineral Resources in Zones 132 and 141, Cut Inverse Distance Weighting Cubed Model, SRK Consulting, January 2005.

Zone Cut-off (gpt Gold)

Tonnage (tonnes)

Gold (gpt) (AUID*)


Silver (gpt) (AGID)


132 0.00 758,500 2.92 71,300 1.71 41,600 1.00 740,700 2.97 70,800 1.74 41,300 2.00 574,300 3.42 63,100 2.09 38,500 3.00 346,400 4.04 45,000 2.88 32,100 4.00 174,100 4.55 25,500 3.55 19,800 5.00 30,100 5.51 5,300 1.62 1,600 6.00 4,100 7.16 950 3.64 500 7.00 2,200 7.81 550 5.16 350 8.00 650 9.07 200 9.02 200 9.00 450 9.20 150 11.07 150133 0.00 12,600 4.00 1,600 0.00 0 1.00 12,600 4.00 1,600 0.00 0 2.00 12,600 4.00 1,600 0.00 0 3.00 12,400 4.01 1,600 0.00 0 4.00 5,450 4.49 800 0.00 0 5.00 50 5.29 9 0.00 0135 0.00 340,100 1.60 17,400 0.84 9,200 1.00 280,800 1.75 15,800 0.89 8,000 2.00 41,000 2.74 3,600 1.05 1,400 3.00 9,950 3.81 1,200 0.99 300 4.00 3,650 4.87 600 1.49 150 5.00 1,000 5.58 200 1.63 50 6.00 150 6.79 50 1.88 9 7.00 50 7.36 10 1.99 0136 0.00 129,000 2.85 11,800 1.33 5,500 1.00 129,000 2.85 11,800 1.33 5,500 2.00 79,100 3.63 9,200 2.06 5,200 3.00 44,300 4.60 6,500 2.28 3,200 4.00 34,500 4.93 5,500 1.65 1,800 5.00 20,000 5.41 3,500 0.54 350137 0.00 103,300 3.80 12,600 8.20 27,200 1.00 96,600 4.00 12,400 8.76 27,200 2.00 83,400 4.41 11,800 10.11 27,100 3.00 53,400 5.47 9,400 13.83 23,700 4.00 43,000 5.96 8,200 16.31 22,600 5.00 26,500 6.93 5,900 24.57 20,900 6.00 20,200 7.36 4,800 26.52 17,200 7.00 13,200 7.85 3,300 27.80 11,800 8.00 5,700 8.31 1,500 31.60 5,800141 0.00 434,600 3.51 49,100 7.69 107,000 1.00 415,800 3.64 48,600 8.03 107,000 2.00 302,700 4.41 42,900 10.67 104,000 3.00 179,500 5.74 33,100 15.95 92,000 4.00 115,100 7.04 26,100 20.85 77,200 5.00 72,400 8.60 20,000 26.48 61,600 6.00 47,500 10.24 15,600 34.01 51,900 7.00 37,000 11.31 13,500 36.89 43,900 8.00 29,800 12.24 11,700 39.61 38,000 9.00 22,900 13.38 9,850 43.16 31,800TOTAL 0.00 1,778,000 2.87 164,000 3.34 191,000 1.00 1,676,000 2.99 161,000 3.52 189,000 2.00 1,093,000 3.76 132,000 5.01 176,000 3.00 646,100 4.66 96,900 7.29 151,000 4.00 375,800 5.51 66,600 10.06 122,000 5.00 150,100 7.24 34,900 17.52 84,600 6.00 72,000 9.25 21,400 30.10 69,700 7.00 52,500 10.29 17,400 33.22 56,000 8.00 36,100 11.56 13,400 37.80 43,900 9.00 23,400 13.30 10,000 42.53 31,900

* Gold grades cut at 44 gpt gold.



CERTIFICATE and CONSENT



CERTIFICATE AND CONSENT

To Accompany the Independent Technical Report entitled Mineral Resource Estimation Zones 132 and 141, Red Mountain Gold Project, British Columbia, January 2005.

I, Ronald John Deptuck, residing at 112 Tyson Drive in Holland Landing, Ontario do hereby certify that:

1) I am an Associate Resource Geologist with the firm of SRC Consulting (Canada) Inc. (SRK) with an office at Suite 1000, 25 Adelaide Street East, Toronto, Canada;

2) I am a graduate of McGill University in Quebec City with a BSc. in Geological Sciences in 1971. I have practiced my profession since 1971.

3) I am a fellow with the Geological Association of Canada and a Professional Geoscientist registered with the Association of Professional Engineers and Geoscientists of the province of Saskatchewan (APEGS#10769);

4) I have not received, nor do I expect to receive, any interest, directly or indirectly, in the Red Mountain project or securities of Seabridge Gold Inc.;

5) I am not aware of any material fact or material change with respect to the subject matter of the technical report, which is not reflected in the technical report, the omission to disclose which makes the technical report misleading;

6) I, as the qualified person, am independent of the issuer as defined in Section 1.5 of National Instrument 43-101;

7) I am a co-author of this report;

8) I have not visited the property;

9) I have read National Instrument 43-101 and Form 43-101F1 and the technical report has been prepared in compliance with this Instrument and Form 43-101F1;

10) SRK Consulting (Canada) Inc. was retained by Seabridge Gold Inc. to prepare an independent Technical Report on the Mineral resource work undertaken by SRK on the Red Mountain Gold Project in accordance with National Instrument 43-101. The preceding report is based on our review of project files and discussions with other SRK Qualified Persons who have visited the property;

11) I hereby consent to use of this report for submission to any Provincial regulatory authority.

Toronto, Canada Ronald John Deptuck, B.Sc., P.Geo. February 9, 2005 Associate Resource Geologist




To Accompany the Independent Technical Report entitled Mineral Resource Estimation Zones 132 and 141, Red Mountain Gold Project, British Columbia, February 2005.

I, Kelly Sexsmith, residing at 517 East 10th Street in Vancouver, British Columbia do hereby certify that:

12) I am a Senior Environmental Geochemist with the firm of SRK Consulting (Canada) Inc. (SRK) with an office at Suite 800, 1066 West Hastings Street, Vancouver, Canada;

13) I am a graduate of the University of British Columbia in Vancouver with a BSc. in Geology in 1989. I obtained a MS in Environmental Science and Engineering at the Colorado School of Mines in 1996. I have practiced my profession from 1990 to 1994 and continuously since 1996;

14) I am a Professional Geoscientist registered with the Association of Professional Engineers and Geoscientists of the province of British Columbia (APEGBC#21397);




18) I am a senior reviewer of the report and co-authored Sections 4 and 5 of this report;

19) I have visited the Red Mountain property August 2000 and August 19-20, 2003;




Vancouver, Canada Kelly Sexsmith, P.Geo. February 9, 2005 Senior Geochemist




To Accompany the Independent Technical Report entitled Mineral Resource Estimation Zones 132 and 141, Red Mountain Gold Project, British Columbia, January 2005.

I, Jean-François Couture, residing at 59 Tiverton Avenue in Toronto, Ontario do hereby certify that:

23) I am a Principal Geologist with the firm of SRK Consulting (Canada) Inc. (SRK) with an office at Suite 602, 357 Bay Street, Toronto, Canada;

24) I am a graduate of the Université Laval in Quebec City with a BSc. in Geology in 1982, I obtained a MSc.A. in Earth Sciences and a Ph.D. in Mineral Resources from Université du Québec à Chicoutimi in 1986 and 1994, respectively. I have practiced my profession continuously since 1982;

25) I am a fellow with the Geological Association of Canada and a Professional Geoscientist registered with the Association of Professional Geoscientists of the province of Ontario (APGO#0197);




29) I am a co-author of this report;

30) I have not visited the property;




Toronto, Canada Jean-François Couture, Ph.D, P.Geo. February 9, 2005 Principal Geologist

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