KSM Project PFS: $7.90B NPV, 16.1% IRR
Seabridge Gold Inc.'s KSM Project in British Columbia, Canada has a Pre-Feasibility Study (PFS) outlining an after-tax NPV of $7.90B, an after-tax IRR of 16.1%, and initial capital of $6.40B. The mine plan runs 33 years at about 1027 koz Au (LOM average); 178 M lbs Cu; 3 M oz Ag per year.
Seabridge Gold Inc.'s KSM Project has reported Pre-Feasibility Study (PFS) results for the gold project in British Columbia, Canada. The study headlines an after-tax net present value of $7.90B at a 5% discount rate. It reflects Seabridge Gold Inc.'s (SEA.TO) latest disclosed economics for the asset.
Economics. The after-tax NPV is $7.90B using a 5% discount rate. After-tax IRR is 16.1%. Initial capital expenditure is estimated at $6.40B, with life-of-mine sustaining capital of $3.20B. The study models a payback period of 3.7 years. All-in sustaining costs are pegged at 601 USD/oz Au (all-in total costs, net of by-products). Economics are based on Base Case: US$1,742/oz Au, US$3.53/lb Cu, US$18.0/oz Ag; US$/C$ exchange rate 0.77. Recent Spot: US$4,400/oz Au, US$6.55/lb Cu, US$65.0/oz Ag; exchange rate 0.72.
Production and mine plan. The project envisions an open-pit operation. Life of mine is 33 years. Average annual production is approximately 1027 koz Au (LOM average); 178 M lbs Cu; 3 M oz Ag. The open-pit strip ratio is 1:1 life of mine strip ratio.
Resources and ownership. The company holds a 100% interest in the project. Royalties and streams: 60% silver royalty at KSM at commercial production (US$225M Sprott Royalties / Ontario Teachers Pension Plan notes); 1.0% NSR at KSM at commercial production (US$150M Sprott Royalties note).
These figures are extracted from Seabridge Gold Inc.'s technical disclosures and reflect the most recent PFS on file. Compare this project against other developers and producers in our project economics database, and always verify the numbers against the original technical report before making any investment decision.
Reserves & Resources
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Proven & Probable | 2,292 Mt | 0.64 g/t Au, 0.14% Cu, 2.2 g/t Ag, 76 ppm Mo | 47.3 Moz Au, 7,320 M lbs Cu, 160 Moz Ag, 385 M lbs Mo |
| Proven & Probable (Mitchell) | 935 Mt | 0.67 g/t Au, 0.18% Cu, 2.9 g/t Ag, 61 ppm Mo | 20.1 Moz Au, 3,619 M lbs Cu, 87 Moz Ag, 127 M lbs Mo |
| Proven & Probable (Sulphurets) | 151 Mt | 0.68 g/t Au, 0.26% Cu, 1.0 g/t Ag, 70 ppm Mo | 3.3 Moz Au, 874 M lbs Cu, 5 Moz Ag, 23 M lbs Mo |
| Proven & Probable (East Mitchell) | 1,206 Mt | 0.62 g/t Au, 0.10% Cu, 1.8 g/t Ag, 89 ppm Mo | 23.9 Moz Au, 2,827 M lbs Cu, 68 Moz Ag, 236 M lbs Mo |
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Measured & Indicated | 6,255 Mt | 0.47 g/t Au, 0.15% Cu, 2.3 g/t Ag, 61 ppm Mo | 95.5 Moz Au, 21,146 M lbs Cu, 460 Moz Ag, 837 M lbs Mo |
| Inferred | 8,469 Mt | 0.31 g/t Au, 0.23% Cu, 2.1 g/t Ag, 32 ppm Mo | 84.4 Moz Au, 42,722 M lbs Cu, 570 Moz Ag, 606 M lbs Mo |
Our Analysis
- IRR after-tax
- 16.1%
higher than 3% of 118 projects we track
- NPV after-tax
- $7.90B
higher than 100% of 187 projects we track
- Initial capex
- $6.40B
81% of NPV
costlier than 99% of 172 projects we track
- Payback
- 3.7yrs
slower than 89% of 101 projects we track
- Mine life
- 33yrs
- Discount rate
- 5%
- Study price assumption
- Base Case: US$1,742/oz Au, US$3.53/lb Cu, US$18.0/oz Ag; US$/C$ exchange rate 0.77. Recent Spot: US$4,400/oz Au, US$6.55/lb Cu, US$65.0/oz Ag; exchange rate 0.72
- Spot gold today
- $4,152.60/oz
The number that matters here is not the after-tax NPV of $7.90B. It is the $6.40B initial capex against a company worth US$2.99B. The build costs roughly 2.1 times the entire equity value, and no mid-cap writes that cheque from cash flow. This is a financing event dressed as a development project: a partner, a streaming deal, a joint venture, or heavy equity issuance. Each path takes something from existing holders, whether through dilution, offtake economics, or a slower and smaller share of a 33-year, British Columbia gold mine. The NPV-to-market-cap gap (about 2.6x) can be read as an asset the market has not recognised, or as a market that has looked at the funding task and priced it accordingly. Both readings are live.
The economics are the supporting act, and they are mixed. A 16.1% after-tax IRR sits in the bottom quartile of the 118 gold projects we track, higher than only 3% of them. Against the roughly 15% after-tax return developers typically need to attract project finance, that leaves almost no margin for the overruns and delays that PFS-level estimates, accurate to perhaps plus or minus 25%, routinely produce. The $7.90B NPV ranks above every one of the 187 gold projects we track, and payback of 3.7 years is moderate, but those figures lean on a 5% discount rate, a reporting convention rather than a hurdle, and on metal prices well below recent spot. Higher prices would help the returns; they do not shrink the cheque.
The decisive question is who funds $6.40B, and on what terms. Until that is answered, the IRR is a secondary concern.
Our take, benchmarked against the project economics in the Mining Stocks database. Figures are estimates drawn from company technical reports — not investment advice; always verify against the source filing.
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