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HIGH LEVERAGE PERPETUAL OPTION ON GOLD

Business Summary

Seabridge Gold is designed to provide its shareholders with maximum leverage to a rising gold price.

Over the past three years, when the gold price was low, Seabridge acquired 15.6 million ounces of gold resources, all in North America, including the 7.5 million ounce Courageous Lake deposit. The Courageous Lake project is one of the 15 largest undeveloped gold deposits in the world and the focus of engineering and exploration programs designed to enhance its value.

Gold Resources

Research shows that a dollar invested in Seabridge current shares at common prices provides ownership of more gold resources than a dollar invested in any other public North American gold vehicle. Each Seabridge share represents an industry-leading 0.54 ounces of fully diluted gold.

Recent Developments: Positive Metallurgical Report for Seabridge's Courageous Lake Gold Project New Test Results a Significant Step Towards Project Viability

Metallurgical test work conducted by SGS-Lakefield under the supervision of Hatch, an independent engineering firm, has concluded that the Courageous Lake's FAT deposit can produce a high-grade flotation concentrate that captures 93-94% of mill feed gold content at a relatively coarse grind. Hatch estimates that a refractory process to treat this concentrate should ultimately recover 90-92% of mill feed gold content.

Hatch was commissioned to undertake a scoping study for the FAT deposit on Seabridge's 100% owned Courageous Lake project located in the Northwest Territories, Canada. The FAT deposit contains an independently estimated 3.18 million ounces of gold resources in the measured and indicated categories (48.0 million tons grading 2.06 grams per ton) plus an additional 4.33 million ounces of resources in the inferred category (65.1 million tons at 2.07 grams per ton).

A key component of the scoping study is to evaluate and recommend processing options for the FAT deposit's refractory ore. During the past summer, a 1,000-kilogram metallurgical sample was collected at the site from core drilled during the late 1990's. The sampling, handling, shipment and preparation followed a protocol developed by Hatch and Roscoe Postle Associates. SGS-Lakefield assayed all sample intervals for gold, arsenic, iron and sulphide sulphur as well as documenting sample weights.SGS-Lakefield prepared blended composites averaging 1.91 grams of gold per ton from three ore domains representing 95% of the FAT deposit.

During the month of November, SGS-Lakefield performed nine flotation tests on samples from the composite. Flotation parameters such as feed grind size, reagent levels, and pH were investigated.

The test results and Hatch's observations are as follows:

• A high gold recovery to concentrate in the range of 93-94% is achievable with conventional bulk sulphide rougher flotation of the composite. With downstream processing of this concentrate it is expected that an overall gold recovery of 90-92% is possible, subject to future refractory process testing.



• Ore grind size has a marginal impact on gold recovery; a coarser grind is therefore expected, which will support lower power consumption for the project. A higher gold concentrate grade is achievable with a minimal downward pH adjustment.



• A bulk rougher concentrate grade of 18-20 grams of gold per ton and 6-8% sulphur from an ore feed of 1.9 grams per ton is achievable. The resulting gold to sulphur ratio of approximately 3-3.5 to 1 is better than some presently operating refractory gold mines. The sulphide grade of the concentrate will support autogenous conditions in the refractory process. This will bring the benefits of reduced capital and operating cost to the project from heat recuperation and process heat generation.

Hatch is proceeding with further metallurgical testing to address the following issues: (1) further potential to upgrade/clean the sulphide concentrate which may benefit costs; (2) perform refractory process tests to establish metal recoveries and basic criteria for upcoming engineering studies; and (3) testing the use of flotation tailings for neutralization which is expected to benefit operating costs.

Fundamental Considerations: TO PROVIDE EXCEPTIONAL SHAREHOLDER RETURNS IN A RISING GOLD MARKET

Value Creation in a Rising Gold Market

• Gold at under $ 325 (Acquire) - Acquiring non-producing resources is more cost effective than investing in exploration or production.
• Gold at $ 325 to $ 400 (Upgrade, Explore and Acquire)
• Gold above $ 400 (Produce/Sell, Upgrade and Explore) - Producing assets command premium prices. A higher price provides reasonable margin for associated risk and reserve replacement costs.

Results to Date

• 8 projects purchased (100% ownership)
• Nearly 14 million ounces of gold acquired from major gold companies (low technical risks) at less than USD 1/ounce
• Each project has significant exploration upside for value enhancement in a rising gold market
• Holding costs average about USD 0.08/ounce per year
• Total spent by previous owners on 8 projects = USD 270 million

1. With Gold at $ 325 to $ 400:



1. Advance Best Project Towards Production



• Program initiated to convert resources to reserves starting with Courageous Lake and Red Mountain
• Hatch (a leading independent engineering firm) undertaking detailed pre-feasibility study to determine mining method, metallurgical process, capital and operating costs for Courageous Lake
• SRK undertaking pre-feasibility study on Red Mountain
• Grassy Mountain next



2. Joint Venture Higher Risk Projects



• First joint venture signed with Noranda to explore Kerr-Sulphside project, and if warranted, to take the project to final feasibility
• Internal review in progress to differentiate joint venture prospects from properties to be explored or developed by Seabridge



3. Conduct Exploration on Select Targets



• Existing resource projects all have significant exploration upside
• Seabridge prioritizing exploration programs for 2003



4. Acquire Early Stage Exploration Plays



• From 1997-2001, 90% of staked ground in Nevada was dropped
• 75% owned Pacific Intermountain Gold ("PIGCO") subsidiary formed with leading U.S. prospector who has assembled significant exploration data base on U.S. gold projects
• PIGCO "ahead of the curve" in staking early stage exploration plays in Nevada (+50,000 acres already acquired)
• PIGCO will farm out projects to capable joint venture partners and may fund selected projects itself



2. With Gold above $ 400



1. Advance best projects into production with experienced partners
2. Continue exploration on selected projects
3. Sell lower "IRR" and smaller projects
4. Consider other jurisdictions

Technical Considerations

As the price of gold pushes through the resistance level at $ 400, the way towards the $ 500 level is opening up.

On August 20, 2003, we wrote: "The price of Seabridge corrected in line with the gold price. As soon as the gold price starts breaking new high ground, so will the price of Seabridge," and indeed, a powerful rally pushed it out of the more than year-old trading range soon thereafter.

While the price of gold is solidly established above the $ 400 level and surges higher, the share price of Seabridge will also continue to rise in its well-established up-trend channel.

Our recommendation: BUY AROUND $ 5!

Peter Zihlmann


www.pzim.com
investment@pzim.com
forex@pzim.com

January 7, 2004

Disclosure: The author has not been paid to write this article, nor has he received any other inducement to do so. The author is a shareholder in the company and will benefit from any increase in the company's share price. Disclaimer: The author's objective in writing this article is to invoke an interest on the part of potential investors in this stock to the point where they are encouraged to conduct their own further diligent research. Neither the information, nor the opinions expressed should be construed as a solicitation to buy or sell this stock. Investors are recommended to obtain the advice of a qualified investment advisor before entering into any transactions in the stock.