Seabridge Gold Inc. (NYSE: SA) announced that British Columbia's Ministry of Mining and Critical Minerals has delayed issuing construction permits for the Mitchell Treaty Tunnels, a key infrastructure component of the company's KSM Project.

The delay stems from a legal challenge by Tudor Gold Corp. regarding whether Seabridge's conditional mineral reserve applies to Tudor's pre-existing mineral claims. Approximately 12.5 kilometers of the proposed tunnels would pass through Tudor's mineral claims.

The Mitchell Treaty Tunnels consist of two parallel tunnels designed to connect mining operations in the Mitchell Valley with processing operations in the Treaty Valley. The Ministry's decision-maker stated he will not approve the permit amendment application until the legal dispute is resolved.

The conditional mineral reserve terms specify that "A free miner must not obstruct, endanger, or interfere with the construction, operation, or maintenance of" the tunnels. The Ministry had previously confirmed in writing that the reserve applies to Tudor's claims.

Seabridge Chair and CEO Rudi Fronk said the company believes the conditional mineral reserve legally allows the British Columbia government to reserve land for infrastructure construction over government-owned lands, including those subject to third-party mineral claims. He noted no construction plans exist until completion of a Final Feasibility Study.

Fronk stated the company would negotiate an "amicable solution" if Tudor receives approval for its Goldstorm Project mine plan, but said moving the tunnel route before Tudor defines its project "makes no sense."

Seabridge holds a Licence of Occupation for the tunnel route and current authorizations to construct tunnel portals at three sites with approximately 100 meters of tunnel length at each location.