Seabridge to list Courageous Lake as Valor Gold

Seabridge Gold (TSX: SEA; NYSE: SA) plans to spin out the company that owns its Courageous Lake gold project in Canada’s Northwest Territories into a new public vehicle called Valor Gold.

The aim is to realize value that management said Tuesday had been “overshadowed for too long” by the much larger KSM project in British Columbia.

“Courageous Lake is a valuable asset,” and is not reflected in Seabridge’s share price, chairman and CEO Rudi Fronk said in a news release.

Courageous Lake ranks among Canada’s largest undeveloped gold deposits, with an estimated 145.2 million tonnes measured and indicated grading 2.36 grams gold per tonne for 11 million oz. gold and a further 40.6 million tonnes inferred at 2.52 grams per tonne 3.3 million oz. inferred.

A 2024 technical report redesigned the project, outlining a potential openpit mine averaging 201,000 oz. gold annually over about 12.6 years. It showed an after-tax net present value at a 5% discount of $523 million (C$719 million), a 20.6% internal rate of return and a 2.8-year payback at $1,850 per oz. gold. At $2,500 per oz., the NPV rises to $1.1 billion and payback shortens to 1.6 years.

Shares rose about 1.6% by mid-Tuesday in Toronto to C$39.88. It has a market capitalization of C$4.2 billion.

Project pipeline

The Toronto-based developer’s portfolio extends beyond Courageous Lake. The company describes KSM in B.C.’s Golden Triangle as the world’s largest undeveloped gold project by resources and has passed key environmental approvals.

Seabridge also owns the Iskut project in B.C. (including the former Johnny Mountain mine and Bronson Slope deposit), the 3 Aces gold project in Yukon and the Snowstorm exploration project on Nevada’s Getchell trend.

“The spin-out will focus on advancing the [Courageous Lake] project through exploration, engineering and permitting,” with shares of Valor Gold to be distributed to Seabridge holders and listed on a major exchange, the company said.

The upside case includes nearby satellites such as Walsh Lake, which hosts an inferred resource of about 4.1 million tonnes at 4.18 grams per tonne for 555,000 oz. gold. Only the main Courageous Lake deposit is in the 2024 mine plan, leaving room for growth. Of the roughly 500 sq. km property, less than 15% has seen modern exploration.

The expansion case relies on inferred resources that need more drilling and engineering before inclusion in a mine plan, and any listing and share distribution require regulatory approvals.