11Moz High-Grade Northwest Territories Project Becomes New Gold Co.

1. Seabridge Gold Inc. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$3,000 and US$6,000.
2. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
3. This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

For additional disclosures, please click here.

1. Ownership and Share Structure Information

The information listed above was updated on the date this article was published and was compiled from information from the company and various other data providers.

Seabridge Gold Inc. (SEA:TSX; SA:NYSE.MKT) has announced its intention to spin off a subsidiary for its Courageous Lake Gold Project in Canada's Northwest Territories, as stated in a December 16 release.

The new wholly owned subsidiary, Seabridge Gold (NWT) Inc., which will be renamed "Valor Gold," holds 100% ownership of the project. Following the spin-off, Valor Gold will focus on advancing the project through exploration, engineering, and permitting, according to Seabridge. It is expected that shares of Valor Gold will be distributed to Seabridge shareholders and listed on at least one major public stock exchange. Seabridge will continue to concentrate primarily on its KSM gold/copper project and other exploration assets.

"We have always believed, as we have shown in our recent studies, that Courageous Lake is a valuable project with enormous additional district potential in a Tier 1 jurisdiction," said Seabridge Chairman and Chief Executive Officer Rudi Fronk. "We also believe that Courageous Lake is being attributed little to no value in the price of Seabridge shares today."

Courageous Lake is one of Canada's largest undeveloped gold projects, with a total contained gold inventory comprising Measured and Indicated Resources of 11 million ounces (Moz) of gold (145.2 million tonnes at an average grade of 2.36 grams per tonne, or g/t), plus an additional 3.3 Moz of gold in the inferred category (40.6 million tonnes at 2.52 g/t). The reported measured and indicated resources include 2.8 Moz of proven and probable reserves (33.9 million tonnes at 2.6 g/t), making it one of the highest-grade open-pit gold projects in Canada, the company stated.

"A spin-out of Courageous Lake should give our shareholders more optionality around a gold asset that has been overshadowed for too long by KSM, which remains our primary development focus," Fronk said. "We believe that this reorganization will bring attention to the potential of Courageous Lake and unlock additional value for Seabridge shareholders while allowing them to continue having the same exposure to all of Seabridge's assets."

More About the Project

In February 2024, Seabridge submitted an updated NI 43-101 technical report for Courageous Lake, which included the results of a revised Preliminary Feasibility Study and a new Preliminary Economic Assessment. This assessment evaluates a conceptual expansion of the Courageous Lake open pit beyond the 2024 PFS mine plan, according to the release. Seabridge believes there is additional upside potential with the inclusion of potential high-grade, near-surface, non-refractory satellite pits nearby, and exploration of the approximately 500 square kilometer land package, of which less than 15% has been explored to date.

Courageous Lake 2024 PFS Highlights (at US$1,850/ounce gold) include:

• Mine Life: 12.6 years
• Total Payable Gold: 2.5 Moz
• Average Annual Payable Gold: 201,000 ounces
• Cash Cost: US$863 per ounce
• All-In Sustaining Cost (AISC): US$999 per ounce
• Initial Capital: US$747 million
• After-Tax NPV (5%): US$523 million
• Internal Rate of Return (IRR): 20.6%
• Payback Period: 2.8 years

The company stated that at a gold price of US$2,500 per ounce, the after-tax NPV (5%) increases to US$1.1 billion, the IRR rises to 38.2%, and the payback period shortens to 1.6 years.

The release also mentioned a Mineral Resource Estimate (MRE) for the project at a 0.8 g/t Au Cut-Off Grade, which includes Measured resources of 6,007 kilotonnes at 2.84 g/t, totaling 548,000 ounces; Indicated resources of 139,167 ktonnes at 2.34 g/t, totaling 10,449,000 ounces; Measured and Indicated resources of 145,174 ktonnes at 2.36 g/t, totaling 10,997,000 ounces; and Inferred resources of 40,603 ktonnes at 2.52 g/t, totaling 3,286,000 ounces.

In addition to these resources, the project also includes a satellite deposit (Walsh Lake) with an inferred resource of 4.13 million tonnes at 4.18 g/t, containing 555,000 ounces of gold, according to the company.

Next Steps for the Spinout

Full details of the proposed arrangement are yet to be announced. Seabridge management stated it will continue to oversee Courageous Lake until a dedicated management team and board of directors are established at Valor Gold. Seabridge employees will not be involved in the day-to-day operations of Valor Gold.

Seabridge plans to spin out Valor Gold with sufficient funds for immediate needs and working capital, but Valor Gold may consider a private financing to raise capital for 2026 and 2027 work programs.

"Once the spinout is completed, Valor Gold intends to complete a targeted drill program to further explore for satellite deposits analogous to Walsh Lake having the potential to materially improve economics," the company said in the release.

Combaluzier maintained Red Cloud's Buy rating of the stock with a target price of CA$74.50 per share.

It is anticipated that the spinout of Valor Gold shares to Seabridge shareholders will be completed through a plan of arrangement under the Canada Business Corporations Act, the company said. Upon closing, Valor Gold will become a reporting issuer in each Canadian province and territory where Seabridge is currently a reporting issuer, and it is expected that Valor Gold will seek a public listing, though there is no guarantee that such a listing will be obtained.

Seabridge intends to update the market on the progress of this transaction in Q1 2026. Readers are cautioned that the reorganization plan described herein is a statement of intention only at this point, and there can be no assurance that the proposed spinout will occur, or that it will occur in the manner and timeline described in this press release. Completion of the proposed transaction is subject to a number of conditions, including the approval of Seabridge's board, Seabridge shareholder approval, court approval, and regulatory approvals.

Concentrating on Advancing KSM

Spinning off the new company allows Seabridge to focus on advancing its KSM gold-copper project and other exploration assets while unlocking value for its shareholders, according to an updated research note by Red Cloud's Taylor Combaluzier on December 17.

"We view a potential spin-out of Courageous Lake positively as we do not believe the asset is getting sufficient value from the market within Seabridge," Combaluzier wrote. "Our valuation of Seabridge is largely based on DCF analyses of KSM and Courageous Lake. We derive a post-financing NAVPS5% estimate of CA$111.80 for the company, of which Courageous Lake comprises ~13% (US$14.75/sh). We do not believe that the current share price takes account of this value and that it largely reflects its KSM project."

The analyst continued, "In the current gold price environment, we believe this potential spin out could likely help unlock more value for Seabridge shareholders."

In addition to the resources and economics noted above, there remains significant exploration potential at Courageous Lake, with nearby satellite pits and less than 15% of the approximately 500 square kilometer property explored to date, the analyst said. Valor Gold plans to conduct a targeted drilling program to further explore for satellite deposits.

"KSM is fully permitted and holds a substantially started designation, allowing it to hold permits for perpetuity," he wrote. "SEA closed a CA$100M financing earlier in 2025, which has strengthened the balance sheet and should continue to fund near-term activities such as the completion of a Feasibility Study and a power switching station. The company is also in talks with potential JV partners to develop the project."

Combaluzier maintained Red Cloud's Buy rating of the stock with a target price of CA$74.50 per share, a return of 85% at the time of writing.

Cantor Fitzgerald Analyst Mike Kozak noted on December 16 that "this is a smart move by Seabridge."

"With gold prices currently at all-time highs, the spin-out of Courageous Lake will likely generate significant value (preliminary estimate: US$400-800 million) within the standalone 'Valor Gold,' currently completely overshadowed by Seabridge's flagship KSM gold-copper project," Kozak wrote.

The analyst continued, "We reiterate our Buy rating and increase our price target on Seabridge from US$37/CA$46 to US$38/CA$48/share."

The Catalyst: Gold Continues to Grow

Gold prices climbed on Wednesday, while silver reached a record high as growing uncertainty about the U.S. economy increased demand for safe-haven assets, according to a December 17 report by Investing.com's Peter Nurse. At 08:40 ET, spot gold rose 0.8% to US$4,335.48 an ounce, just US$50/ounce shy of a new record, and gold futures for February increased by 0.8% to US$4,367/ounce.

Demand for safe havens was bolstered by a mixed set of U.S. economic data released on Tuesday, including a slight rise in nonfarm payrolls and a higher unemployment rate in November, the report said. The U.S. jobless rate reached a four-year high, raising concerns about the economy. Signs of a cooling U.S. economy were further evidenced by weaker-than-expected purchasing managers index readings for December, while delayed retail sales data for October also indicated slowing growth from the previous month.

The weak data emerged amid ongoing concerns over liquidity levels in U.S. markets, particularly after the Federal Reserve resumed its Treasury buying activities, known as "quantitative easing," in December. This situation fueled demand for safe havens like gold and increased speculation over further interest rate cuts by the Fed, a scenario favorable for non-yielding assets. Attention is now focused on Thursday's consumer price index, as investors seek more insights into the world's largest economy.

Gold prices could maintain their upward momentum into early 2026, Nurse reported, with spot levels potentially increasing significantly, according to BMO Capital's latest metals outlook. In its 2026 Metals & Bulk Commodity Price Year Ahead report, BMO Capital analyst Helen Amos stated that "gold's resilience post-October's sell-off shows its appeal as a diversifier and safe haven endures," adding that "spot prices could breach US$4,600/oz as soon as Q1."

The bank noted that the past year has been "spectacular for metals and mining," with precious metals prices rising 60%–100% "far in excess of year-ago expectations," but argued that "it is too soon to fade this rally."

According to Frank Holmes, writing for U.S. Global Investors on September 15, "Gold mining stocks are experiencing an exceptional year in 2025." Holmes observed, "The price of gold has reached one record high after another, and the mining companies extracting it are delivering some of the best returns in the market today." He noted, "It's rare to witness such a strong alignment of factors benefiting this industry. From central bank purchases to political uncertainty and disciplined corporate practices, everything seems to be aligning perfectly for gold and the miners who produce it." Since Holmes wrote, gold has continued to climb, indicating the persistence of this trend.

Ownership and Share Structure¹

Management and insiders hold approximately 2% of the company, while institutions own about 65%. The remainder is held by retail investors.

Friedberg Mercantile Group Ltd. holds 15.49%, Pan Atlantic Bank and Trust owns 10.23%, Van Eck Associates Corp. has 7.84%, and Kopernik Global Investors L.L.C. possesses 9.9%.

There are around 104.35 million shares outstanding, with the company having a market cap of CA$4.19 billion and trading within a 52-week range of CA$13.44 to CA$43.50.