The effect of a second petition filed in the British Columbia Supreme Court challenging the "substantially started" (SS) designation of Seabridge Gold Inc.'s (SEA:TSX; SA:NYSE.MKT) KSM Project is "neutral," Red Cloud Analyst Taylor Combaluzier writes. The analyst says the company plans to aggressively defend itself."
The effect of a second petition filed in the British Columbia Supreme Court challenging the "substantially started" (SS) designation of Seabridge Gold Inc.'s (SEA:TSX; SA:NYSE.MKT) KSM Project is "neutral" given that it has been combined with an earlier petition that "covers the same ground," Red Cloud Analyst Taylor Combaluzier wrote in an updated research note on December 3.
This new petition was filed by SkeenaWild Conservation Trust and Southeast Alaska Indigenous Transboundary Commission, which are, according to Combaluzier, public interest advocates and "not private litigants who claim rights or property interests in KSM."
The same two groups also brought legal challenges to KSM's environmental certificate a decade ago, he wrote.
"We are optimistic that these challenges will ultimately prove unsuccessful because the arguments by the petitioners were already considered during the SS application phase and the broad discretion the minister has in making an SS determination," noted Combaluzier, who rated the stock a Buy with a CA$48.50 per share target price, a 146% lift from its close when he wrote. "We note that these challenges have no immediate effect on the SS determination, and a verdict on the matter could take a year or more."
The latest petitions are challenging the SS determination as being "unreasonable not simply incorrect," he wrote.
"According to the company, the legislation leaves the minister with a lot of discretion to make the SS determination, so there is a high bar to prove the minster's decision was unreasonable," the analyst wrote.
The same three petitioners also opposed Seabridge's application for the SS determination and made similar arguments then, Combaluzier said.
All of the petitions will be combined and heard together in court, and Combaluzier said Seabridge "plans to aggressively defend itself."
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Seabridge Gold Inc. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Seabridge Gold Inc. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.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.
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