Table
      of Contents


UNITED
      STATES SECURITIES AND EXCHANGE COMMISSION


Washington,
      D.C. 20549





**FORM
      20-F**





__
            REGISTRATION
                STATEMENT  PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES
                EXCHANGE ACT OF 1934ORXX
            ANNUAL
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934 for the fiscal year ended December 31, 2005OR__
            TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934
              For
                the transition period from __________ to
                _______________OR__
            SHELL
                COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                EXCHANGE
                ACT OF 1934
              Date
                of event requiring this shell company report ______________
              For
                the transition period from __________ to
                _______________








Commission
      file number: 0-50657





Seabridge
      Gold Inc.


(Exact
      name of Registrant as specified in its charter)





Canada


(Jurisdiction
      of incorporation or organization)




172
      King Street East, 3rd Floor, Toronto, Ontario CANADA M5A
      1J3


(Address
      of principal executive offices)





Securities
      registered or to be registered pursuant to Section 12(b) of the
      Act.





Title
                of each class
            Name
                of each exchange on which registeredCommon
                Stock, no par value
            American
                Stock ExchangeCommon
                Stock, no par value
            TSX
                Venture Exchange








Securities
      registered or to be registered pursuant to Section 12(g) of the
      Act.





N/A


(Title
      of
      Class)





Securities
      for which there is a reporting obligation pursuant to Section 15(d) of the
      Act.
None





Indicate
      the number of outstanding shares of each of the issuer's classes of capital
      or
      common stock as of the close of the period covered by the annual
      report: 32,106,685





Indicate
      by check mark if the registrant is a well-known seasoned issuer as defined
      in
      Rule 405 of the Securities Act





___
      Yes   xx No







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If
      this
      report is an annual or transition report, indicate by check mark if the
      registrant is not required to file reports pursuant to Section 13 or 15(d)
      of
      the Securities Exchange Act of 1934.




___
      Yes   xx 
No





Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days. xx Yes __ No





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer,, or a non-accelerated filer. See definition of “accelerated
      filer and large accelerated filer” in Rule 12b-2 of the Exchange Act (Check
      one):





Large
      accelerated filer ___ Accelerate filer ___ Non-accelerated filer
      _xx





Indicate
      by check mark which financial statement item the registrant has elected
      to follow.


xx Item
      17 ____ Item 18





If
      this
      is an annual report, indicate by check mark whether the registrant is a shell
      company (as defined in Rule 12b-2 of the Exchange Act).


___
      Yes   xx No





(APPLICABLE
      ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE
      YEARS)





Indicate
      by check mark whether the registrant has filed all documents and reports
      required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange
      Act
      of 1934 subsequent to the distribution of securities under a plan confirmed
      by a
      court.


___
      Yes   __ No




2
 Table
          of Contents





**Seabridge
      Gold Inc.**


Form
      20-F
      Annual Report


Table
      of Contents





**PART
                1**
            **PAGE**Item
                1.
            Identity
                of Directors, Senior Management and
                Advisers
            9Item
                2.
            Offer
                Statistics and Expected Timetable
            10Item
                3.
            Key
                Information
            10Item
                4
            Information
                on the Company
            20Item
                4A
            Unresolved
                Staff Comments
            63Item
                5.
            Operating
                and Financial Review and
                Prospects
            63Item
                6.
            Directors,
                Senior Management and
                Employees
            67Item
                7.
            Major
                Shareholders and Related Party
                Transactions
            77Item
                8.
            Financial
                Information
            78Item
                9.
            The
                Offer and Listing
            78Item
                10.
            Additional
                Information
            80Item
                11.
            Quantitative
                and Qualitative Disclosures about Market
                Risk
            89Item
                12.
            Description
                of Securities Other than Equity
                Securities
            90**PART
                II**Item
                13.
            Default,
                Dividend Arrearages and
                Delinquencies
            90Item
                14.
            Material
                Modifications to the Rights of Securities Holders
                and
              Use
                of Proceeds
            90Item
                15.
            Controls
                and Procedures
            90Item
                16A.
            Audit
                Committee Financial Expert
            91Item
                16B.
            Code
                of Ethics
            91Item
                16C.
            Principal
                Accountant Fees and Services
            91Item
                16D.
            Exemptions
                from the Listing Standards for Audit
                Committees
            91Item
                16E.
            Purchases
                of Equity Securities by the Issuer and
                Affiliated
              Purchasers
            91**PART
                III**Item
                17.
            Financial
                Statements
            92Item
                18.
            Financial
                Statements
            92Item
                19.
            Exhibits
            92




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**METRIC
      EQUIVALENTS**




For
      ease
      of reference, the following factors for converting metric measurements into
      imperial equivalents are provided:





**To
                Convert from Metric**
            **To
                Imperial**
            **Multiply
                by**Hectares
            Acres
            2.471Meters
            Feet
                (ft.)
            3.281Kilometers
                (km)
            Miles
            0.621Tonnes
            Tons
                (2000 pounds)
            1.102Grams/tonne
            Ounces
                (troy/ton)
            0.029








**GLOSSARY
      OF TERMS**





**S.E.C
                Industry Guide**
            **National
                Instrument 43-101****Reserve:**That part of a mineral deposit which could be economically
                and
                legally extracted or produced at the time of the reserve determination.
                The United States Securities and Exchange Commission requires a final
                or
                full Feasibility Study to support either Proven or Probable Reserves
                and
                does not recognize other classifications of mineralized
                deposits.
            **Mineral
                Reserve:**The economically mineable part of a Measured or
                Indicated Mineral Resource demonstrated by at least a Preliminary
                Feasibility study. This study must include adequate information on
                mining,
                processing, metallurgical, economic and other relevant factors that
                demonstrate, at the time of reporting, that economic extraction can
                be
                justified.**Proven
                Reserves:** Reserves for which a quantity is computed from
                dimensions revealed in outcrops, trenches, workings or drill holes;
                grade
                and/or quality are computed from the results of detailed sampling
                and
                measurement are spaced so closely and the geologic character is so
                well
                defined that size, shape, depth, and mineral content of reserves
                are well
                established.
            **Proven
                Mineral Reserve:**The economically mineable part of a Measured
                Mineral Resource demonstrated by at least a Preliminary Feasibility
                study.
                This study must include adequate information on mining, processing,
                metallurgical, economic and other relevant factors that demonstrate,
                at
                the time of reporting, that economic extraction is justified.**Probable
                Reserves:**For which quantity and grade and/or quality are
                computed from information similar to that used for proven reserves,
                but
                the sites for inspection, sampling and measurement are farther apart
                or
                are otherwise less adequately spaced. The degree of assurance, although
                lower than that for proven reserves, is high enough to assume continuity
                between points of observation.
            **Probable
                Mineral Reserve:**The economically mineable part of an indicated,
                and in some circumstances, a Measured Mineral Resource, demonstrated
                by at
                least a Preliminary Feasibility Study. This study must include adequate
                information on mining, processing, metallurgical, economic and other
                relevant factors that demonstrate, at the time of reporting, that
                economic
                extraction can be justified.





**Adularia
      -**A colorless, moderate- to low-temperature variety of orthoclase
      feldspar typically with relatively high barium content.





**Andesite
      -** A dark-colored, fine-grained extrusive rock that, when porphyritic,
      contains phenocrysts composed primarily of zoned sodic plagioclase and one
      or
      more of the mafic minerals.




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**Argulite
        -**A variety of asphaltic sandstone


**Arkose
      -** A feldspar-rich sandstone, typically coarse-grained and pink or
      reddish, that is composed of angular to subangular grains that may be either
      poorly or moderately well sorted; usually derived from the rapid disintegration
      of granite or granitic rocks, and often closely resembles granite.





**Basalt
      -**A general term for dark-colored mafic igneous rocks, commonly
      extrusive but locally intrusive





**Breccia**
      - A rock in which angular fragments are surrounded by a mass of fine-grained
      minerals.





**Caldera
      -** A large, basin-shaped volcanic depression, more or less circular,
      the
      diameter of which is many times greater than that of the included vent or
      vents.





**Carbonate
      -**A sediment formed by the organic or inorganic precipitation from
      aqueous solution of carbonates of calcium, magnesium, or iron; e.g., limestone
      and dolomite





**Cut-off
      grade -** the lowest grade of mineralized material that qualifies as
      reserve in a deposit. It is also used to estimate mineral reserves by including
      in the estimates only those assays above the cut-off grade.





**Cut
      Value** - Applies to assays that have been reduced to a statistically
      determined maximum to prevent erratic high values from inflating the
      average.





**Diamond
      Drilling** - a type of rotary drilling in which diamond bits are used as
      the rock-cutting tool to produce a recoverable drill core sample of rock for
      observation and analysis.





**Diorite**
      - An intrusive igneous rock.





**Drift**
      - A horizontal underground opening that follows along the length of a vein
      or
      rock formation.





**Environmental
      Baseline Study -**a geotechnical study that monitors and establishes the
      numerous naturally occurring base levels present within a specific
      area/environment. These can include; water chemistry, flora and
      fauna.





**Epithermal**
      - low temperature hydrothermal process or product.





**Fault**
      - a fracture or break in rock along which there has been movement.




**Feasibility
      Study** - is a definitive study of the viability of a mineral project by
      a qualified professional which defines: (1) mining methods, pit configuration,
      mine scheduling, mine equipment and all related costing, (2) method of mineral
      processing and all related plant, equipment and costing, (3) necessary
      determination of all infrastructure required and relevant costs and (4) all
      requirements of government and markets for mine operation. A definitive
      financial analysis of the mineral project taking into consideration all relevant
      factors, which will establish the presence of a Mineral Reserve and the details
      of its economic viability.





**Geochemistry**
      - The study of the chemical properties of rocks.





**Geophysical
      Survey** - A scientific method of prospecting that measures the physical
      properties of rock formations. Common properties investigated include magnetism,
      specific gravity, electrical conductivity and radioactivity.





**Grade**
      - The metal content of rock with precious metals, grade can be expressed as
      troy
      ounces or grams per tonne of rock.





**Granite**
      - any holocrystalline, quartz-bearing plutonic rock.




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**Granitic**
      - Pertaining to or composed of granite.





**Hydrothermal**
      - the products or the actions of heated waters in a rock mass such as a mineral
      deposit precipitating from a hot solution.





**Indicated
      Resource -** in reference to minerals means quantity and grade and (or)
      quality are computed from information similar to that used for resources, but
      the sites for inspection, sampling, and measurement are farther apart or are
      otherwise less adequately spaced. The degree of assurance, although lower than
      that for resources, is high enough to assume continuity between points of
      observation.





**Inferred
      Resource -** in reference to minerals, means estimates are based on an
      assumed continuity beyond measured and (or) indicated resources, for which
      there
      is geological evidence. Inferred resources may or may not be supported by
      samples or measurements.





**Intrusion;
      Intrusive**- molten rock that is intruded (injected) into spaces that
      are created by a combination of melting and displacement.





**Kriging**
      - In the estimation of ore reserves by geostatistical methods, the use of a
      weighted, moving-average approach both to account for the estimated values
      of
      spatially distributed variables, and also to assess the probable error
      associated with the estimates.





**Lode
      -** A mineral deposit consisting of a zone of veins, veinlets,
      disseminations, or planar breccias; a mineral deposit in consolidated rock
      as
      opposed to a placer deposit.





**Measured
      Resources -** in reference to minerals, means a quantity is computed from
      dimensions revealed in outcrops, trenches, workings, or drill holes; grade
      and
      (or) quality are computed from the results of detailed sampling. The sites
      for
      inspection, sampling, and measurement are spaced so closely and the geological
      character is so well defined that size, shape, depth and mineral content of
      the
      resource are well established.





**Monzonite
      -**A granular plutonic rock containing approx. equal amounts of
      orthoclase and plagioclase, and thus intermediate between syenite and diorite.
      Quartz is minor or absent.





**Net
      Smelter Return Royalty/ NSR -**A phrase used to describe a royalty
      payment made by a producer of metals based on gross metal production from the
      property, less deduction of certain limited costs including smelting, refining,
      transportation and insurance costs.





**Patented
      -**A claim to which a patent has been secured from the U.S. Government,
      in compliance with the laws relating to such claims.





**Placer**
      - A deposit of sand or gravel that contains particles of gold, ilmenite,
      gemstones, or other heavy minerals of value. The common types are stream gravels
      and beach sands.





**Porphyry**
      - Any igneous rock in which relatively large crystals are set in a fine-grained
      matrix of rock.





**Prefeasability
      Study** - is a comprehensive study of the viability of a mineral project
      that has advanced to a stage where the mining method, in the case of underground
      mining, or the pit configuration, in the case of an open pit, has been
      established, and where an effective method of mineral processing had been
      determined. This Study must include a financial analysis based on reasonable
      assumptions of technical engineering, operating, and economic factors, which
      are
      sufficient for a Qualified Person acting reasonably, to determine if all or
      part
      of the Mineral Resource may be classified as a Mineral Reserve.





**Pyrite**- an iron sulphide mineral (FeS2), the most common naturally
      occurring sulphide mineral.




**Quartz**
        - crystalline silica; often forming veins in fractures and faults within
        older
        rocks.


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**Quartz
      Monzonite**- a coarse grained, quartz rich igneous rock usually
      occurring as a smaller rock mass associated with major granitic
      bodies.





**Raise
      -**A vertical or inclined underground working that has been excavated
      from the bottom upward.





**Reclamation
      -** Restoration of mined land to original contour, use, or
      condition.





**Resource**
      - Under the Canadian Institute of Mining (“CIM”) standards, Mineral Resource is
      a concentration or occurrence of natural, solid, inorganic or fossilized organic
      material in or on the earth’s crust in such form and quantity and of such a
      grade or quality that it has reasonable prospects for economic extraction.
      The
      location, quantity, grade, geological characteristics and continuity of a
      Mineral Resource are known, estimated or interpreted from specific geological
      evidence and knowledge.





A
      mineral
      resource estimate is based on information on the geology of the deposit and
      the
      continuity of mineralization. Assumptions concerning economic and operating
      parameter*s,*including cut-off grades and economic mining widths, based
      on factors typical for the type of deposit, may be used if these factors have
      not been specifically established for the deposit at the time of the mineral
      resource estimate. A mineral resource is categorized on the basis of the degree
      of confidence in the estimate of quantity and grade or quality of the deposit,
      as follows:





**Measured
      Mineral Resource:**Under CIM standards, a Measured Mineral Resource is
      that part of a Mineral Resource for which quantity, grade or quality, densities,
      shape, physical characteristics are so well established that they can be
      estimated with confidence sufficient to allow the appropriate application of
      technical and economic parameters, to support production planning and evaluation
      of the economic viability of the deposit. The estimate is based on detailed
      and
      reliable exploration, sampling and testing information gathered through
      appropriate techniques from locations such as outcrops, trenches, pits, workings
      and drill holes that are spaced closely enough to confirm both geological and
      grade continuity.





**Indicated
      Mineral Resource:**Under CIM standards, an Indicated Mineral Resource is
      that part of a Mineral Resource for which quantity, grade or quality, densities,
      shape and physical characteristics can be estimated with a level of confidence
      sufficient to allow the appropriate application of technical and economic
      parameters, to support mine planning and evaluation of the economic viability
      of
      the deposit. The estimate is based on detailed and reliable exploration and
      testing information gathered through appropriate techniques from locations
      such
      as outcrops, trenches, pits, workings and drill holes that are spaced closely
      enough for geological and grade continuity to be reasonably
      assumed.





**Inferred
      Mineral Resource:**Under CIM standards, an Inferred Mineral Resource is
      that part of a Mineral Resource for which quantity and grade or quality can
      be
      estimated on the basis of geological evidence and limited sampling and
      reasonably assumed, but not verified, geological and grade continuity. The
      estimate is based on limited information and sampling gathered through
      appropriate techniques from such as outcrops, trenches, pits, workings and
      drill
      holes.





**Rhyolite
      -** A group of extrusive igneous rocks, typically porphyritic and
      commonly exhibiting flow texture, with phenocrysts of quartz and alkali feldspar
      in a glassy to cryptocrystalline groundmass; also, any rock in that group;
      the
      extrusive equivalent of granite.





**Sedimentary**
      - Formed by the deposition of sediment or pertaining to the process of
      sedimentation.





**Sediments
      -**Solid fragmental material that originates from weathering of rocks
      and is transported or deposited by air, water, or ice, or that accumulates
      by
      other natural agents, such as chemical precipitation from solution or secretion
      by organisms, and that forms in layers on the Earth's surface at ordinary
      temperatures in a loose, unconsolidated form; e.g., sand, gravel, silt, mud,
      alluvium.





**Sericite**
      - A fine-grained potassium mica found in various metamorphic rocks.




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**Silification**
      - the in situ alteration of a rock, which involves an increase in the proportion
      of silica minerals.





**Trenching**
      - the process of exploration by which till is removed from a trench cut from
      the
      earth’s surface.





**Tuff
      -**A general term for all consolidated pyroclastic rocks.





**Unpatented
      Claim -** Mining claim to which a deed from the U.S. Government has
      not been received. A claim is subject to annual assessment work, to maintain
      ownership.





**Vein**- a thin, sheet-like, crosscutting body of hydrothermal mineralization,
      principally quartz.





**Volcanics**- those originally molten rocks, generally fine grained, that have
      reached or nearly reached the Earth’s surface before solidifying.





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**Part
      I**




**Item
      1. Identity of Directors, Senior Management and
      Advisers**




**A.**     **Directors
      and Senior Management**








Table
      No.
      1


Company
      Directors and Senior Officers


As
      of
      March 15, 2006




Name
            Position
            Business
                AddressJames
                Anthony
            Chairman
                and Director
            172
                King Street East, 3rd Floor,
              Toronto,
                Ontario M5A 1J3
              CanadaRudi
                Fronk
            President,
              Chief
                Executive Officer and Director
            172
                King Street East, 3rd Floor,
              Toronto,
                Ontario M5A 1J3
              CanadaFrederick
                Banfield
            Director
            3544
                E. Fort Lowell,
              Tucson,
                Arizona 85716William
                Calhoun
            Director
            P.O.
                Box 90
              Silverton,
                Idaho 83867Thomas
                Dawson
            Director
            736
                O’Connor Drive
              Toronto,
                Ontario M4C 3A9
              CanadaHenry
                Fenig
            Director
            Suite
                250, BCE Place,
              181
                Bay Street,
              Toronto,
                Ontario M5J 2T3
              CanadaLouis
                J. Fox
            Director
            3200
                North Ocean Blvd, #2410
              Fort
                Lauderdale, Florida 33308Eliseo
                Gonzalez-Urien
            Director
            10911
                Corp Ranch Rd.
              Ashland,
                Oregon 95720William
                Threlkeld
            Senior
                Vice President
            172
                King Street East, 3rd Floor,
              Toronto,
                Ontario M5A 1J3
              Canada




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Roderick
                Chisholm
            Chief
                Financial Officer and Corporate Secretary
            172
                King Street East, 3rd Floor,
              Toronto,
                Ontario M5A 1J3
              Canada


**B.****Advisers**





Not
      Applicable





**C.****Auditors**





The
      Company’s auditor is KPMG LLP, Chartered Accountants, of Suite 3300 Commerce
      Court West, Toronto, Ontario, Canada. KPMG was initially appointed on June
      4,
      2002 for the fiscal year ending December 31, 2002.




**Item
      2.****Offer Statistics
      and Expected Timetable**




Not
      Applicable





**Item
      3.****Key
      Information**




As
      used
      within this Annual Report, the terms “Seabridge”, “the Company”, “Issuer” and
“Registrant” refer collectively to Seabridge Gold Inc, and depending on the
      context, its predecessors, subsidiaries and affiliates.





All
      currency figures stated herein are in Canadian dollars, unless otherwise
      noted.





**A.**   **Selected
      Financial Data**





The
      selected financial data of the Company for the Years Ended December 31, 2005,
      December 31, 2004 and December 31, 2003 was derived from the financial
      statements audited by KPMG LLP, Chartered Accountants, as indicated in its
      audit
      report which is included elsewhere in this Annual Report. The selected financial
      data for the years ended December 31, 2002 and December 31, 2001 was derived
      from the audited financial statements of the Company which are not included
      in
      this Report.





The
      selected financial data should be read in conjunction with the financial
      statements and other financial information included elsewhere in the Annual
      Report.





The
      Company has not declared any dividends on its common shares since incorporation
      and does not anticipate that it will do so in the foreseeable future. The
      present policy of the Company is to retain future earnings for use in its
      operations and the expansion of its business.




10
 Table
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Table
      No.
      2 is derived from the financial statements of the Company, which have been
      prepared in accordance with Canadian Generally Accepted Accounting Principles
      (GAAP), the application of which, in the case of the Company, conforms in all
      material respects for the periods presented with US GAAP, except as disclosed
      in
      a footnote to the financial statements.





Table
      No.
      2


Selected
      Financial Data


($’s
      in
      000, except per share data)





Year
            
            Year
            
            Year
            
            Year
            
            YearEnded
            
            Ended
            
            Ended
            
            Ended
            
            Ended12/31/05
            
            12/31/04
            
            12/31/03
            
            12/31/02
            
            12/31/01Interest
                Income
            
            $
            135
            
            $
            83
            
            $
            107
            
            $
            85
            
            $
            24Net
                Loss
            
            $
            1,157
            
            $
            1,226
            
            $
            1,338
            
            $
            1,630
            
            $
            456Net
                Loss Per Share
            
            $
            0.04
            
            $
            0.04
            
            $
            0.05
            
            $
            0.10
            
            $
            0.04Dividends
                Per Share
            
            $
            0
            
            $
            0
            
            $
            0
            
            $
            0
            
            $
            0Weighted
                Average Shares (000)
            
            
            30,682
            
            
            28,876
            
            
            26,191
            
            
            16,212
            
            
            12,600Working
                Capital
            
            $
            10,603
            
            $
            4,220
            
            $
            1,886
            
            $
            3,819
            
            $
            2,582Mineral
                Properties
            
            $
            24,395
            
            $
            20,999
            
            $
            16,635
            
            $
            9,018
            
            $
            2,977Long-Term
                Debt
            
            $
            0
            
            $
            0
            
            $
            0
            
            $
            828
            
            $
            2,009Shareholder’s
                Equity
            
            $
            35,385
            
            $
            25,703
            
            $
            19,154
            
            $
            12,052
            
            $
            3,781Total
                Assets
            
            $
            37,085
            
            $
            27,172
            
            $
            22,869
            
            $
            14,143
            
            $
            6,977US
                GAAP Net Loss
            
            $
            5,127
            
            $
            6,671
            
            $
            5,255
            
            $
            3,236
            
            $
            1,697US
                GAAP Loss Per Share
            
            $
            0.17
            
            $
            0.23
            
            $
            0.20
            
            $
            0.20
            
            $
            0.13US
                GAAP Weighted Average Shares (000)
            
            
            30,682
            
            
            28,876
            
            
            26,191
            
            
            16,212
            
            
            12,600US
                GAAP Equity
            
            $
            19,727
            
            $
            13,616
            
            $
            12,132
            
            $
            9,044
            
            $
            2,379US
                GAAP Total Assets
            
            $
            21,848
            
            $
            15,287
            
            $
            15,756
            
            $
            11,026
            
            $
            5,575US
                GAAP Mineral Properties
            
            $
            9,159
            
            $
            9,113
            
            $
            9,522
            
            $
            5,901
            
            $
            1,576





In
      this
      Annual Report, unless otherwise specified, all dollar amounts are expressed
      in
      Canadian Dollars (CDN$). The Government of Canada permits a floating exchange
      rate to determine the value of the Canadian Dollar against the U.S. Dollar
      (US$).





Table
      No.
      3 sets forth the rate of exchange for the Canadian Dollar at the end of the
      five
      most recent fiscal periods ended December 31st, the average rates for
      the period, and the range of high and low rates for the period. Table No. 3
      also
      sets forth the rate of exchange for the Canadian Dollar at the end of the 12
      most recent fiscal quarters, and the range of high and low rates for these
      periods.





For
      purposes of this table, the rate of exchange means the noon buying rate in
      New
      York City for cable transfers in foreign currencies as certified for customs
      purposes by the Federal Reserve Bank of New York. The table sets forth the
      number of Canadian dollars required under that formula to buy one U.S. Dollar.
      The average rate means the average of the exchange rates on the last day of
      each
      month during the period.




11
 Table
          of Contents




Table
      No.
      3


Canadian
      Dollar/US Dollar





Average
            
            High
            
            Low
            
            CloseYear
                Ended 12/31/05
            
            $
            1.21
            
            $
            1.27
            
            $
            1.15
            
            $
            1.17Year
                Ended 12/31/04
            
            $
            1.30
            
            $
            1.39
            
            $
            1.18
            
            $
            1.20Year
                Ended 12/31/03
            
            $
            1.39
            
            $
            1.58
            
            $
            1.29
            
            $
            1.29Year
                Ended 12/31/02
            
            $
            1.57
            
            $
            1.61
            
            $
            1.51
            
            $
            1.52Year
                Ended 12/31/01
            
            $
            1.55
            
            $
            1.60
            
            $
            1.49
            
            $
            1.59Three
                Months Ended 12/31/05
            
            $
            1.17
            
            $
            1.19
            
            $
            1.15
            
            $
            1.17Three
                Months Ended 9/30/05
            
            $
            1.19
            
            $
            1.24
            
            $
            1.16
            
            $
            1.16Three
                Months Ended 6/30/05
            
            $
            1.24
            
            $
            1.27
            
            $
            1.21
            
            $
            1.23Three
                Months Ended 3/31/05
            
            $
            1.23
            
            $
            1.23
            
            $
            1.20
            
            $
            1.21Three
                Months Ended 12/31/04
            
            $
            1.22
            
            $
            1.27
            
            $
            1.18
            
            $
            1.20Three
                Months Ended 9/30/04
            
            $
            1.31
            
            $
            1.33
            
            $
            1.26
            
            $
            1.31Three
                Months Ended 6/30/04
            
            $
            1.36
            
            $
            1.39
            
            $
            1.31
            
            $
            1.34Three
                Months Ended 3/31/04
            
            $
            1.32
            
            $
            1.34
            
            $
            1.27
            
            $
            1.31Three
                Months Ended 12/31/03
            
            $
            1.30
            
            $
            1.35
            
            $
            1.29
            
            $
            1.29Three
                Months Ended 9/30/03
            
            $
            1.38
            
            $
            1.41
            
            $
            1.34
            
            $
            1.35Three
                Months Ended 6/30/03
            
            $
            1.39
            
            $
            1.48
            
            $
            1.33
            
            $
            1.36Three
                Months Ended 3/31/03
            
            $
            1.50
            
            $
            1.58
            
            $
            1.47
            
            $
            1.47





**B.**   **Capitalization
      and Indebtedness**




Not
      applicable





**C.**   **Reasons
      for the Offer and Use of Proceeds**





Not
      applicable





**D.**   **Risk
      Factors**





An
      investment in the Common Shares of the Company must be considered speculative
      due to the nature of the Company’s business and the present stage of exploration
      of its non-producing mineral properties. In particular, the following risk
      factors apply:





Risks
      Associated with Mineral Exploration





**The
      Company is Involved in the Resource Industry which is Highly Speculative and
      has
      Certain Inherent Exploration Risks which Could have a Negative Effect on the
      Company’s Operations**




12
 Table
          of Contents




Resource
      exploration is a speculative business, characterized by a number of significant
      risks including, among other things, unprofitable efforts resulting not only
      from the failure to discover mineral deposits but also from finding mineral
      deposits which, though present, are insufficient in quantity and quality to
      return a profit from production. The marketability of minerals acquired or
      discovered by the Company may be affected by numerous factors which are beyond
      the control of the Company and which cannot be accurately predicted, such as
      market fluctuations, the proximity and capacity of milling facilities, mineral
      markets and processing equipment, and such other factors as government
      regulations, including regulations relating to royalties, allowable production,
      importing and exporting of minerals, and environment protection, the combination
      of which factors may result in the Company not receiving an adequate return
      on
      investment capital.





**The
      Company’s Operations Contain Significant Uninsured Risks which Could Negatively
      Impact Profitability as the Company Maintains No Insurance Against its
      Operations**


The
      Company’s exploration of its mineral properties contain certain risks, including
      unexpected or unusual operating conditions including rock bursts, cave-ins,
      flooding, fire and earthquakes which could adversely affect operations and
      may
      result in liabilities.





The
      Company currently maintains no insurance against its properties or operations
      and may decide to not take out any such insurance in the future. If such
      liabilities arise, they could reduce or eliminate the Company’s assets and
      shareholder equity as well as result in increased costs and a decline in the
      value of the Company’s securities.





**The
      Company Has No Known Reserves and No Economic Reserves May Exist on Its
      Properties Which Would have a Negative Effect on the Company’s Operations and
      Valuation**


Despite
      exploration work on its mineral claims, no known bodies of commercial ore or
      economic deposits have been established on any of the Company’s mineral
      properties. In addition, the Company is at the exploration stage on all of
      its
      properties and substantial additional work will be required in order to
      determine if any economic deposits occur on the Company’s properties. Even in
      the event commercial quantities of minerals are discovered, the exploration
      properties might not be brought into a state of commercial production. Finding
      mineral deposits is dependent on a number of factors, not the least of which
      is
      the technical skill of exploration personnel involved. The commercial viability
      of a mineral deposit once discovered is also dependent on a number of factors,
      some of which are particular attributes of the deposit, such as size, grade
      and
      proximity to infrastructure, as well as metal prices. Most of these factors
      are
      beyond the control of the entity conducting such mineral exploration. The
      Company is an exploration stage company with no history of pre-tax profit and
      no
      income from its operations. There can be no assurance that the Company’s
      operations will be profitable in the future.





**The
      Company Has Not Surveyed Any of Its Properties and the Company Could Lose Title
      and Ownership of Its Properties which would have a Negative Effect on the
      Company’s Operations and Valuation**




13
 Table
          of Contents





The
      Company has only done a preliminary legal survey of the boundaries of any of
      these properties, and therefore, in accordance with the laws of the
      jurisdictions in which these properties are situated, their existence and area
      could be in doubt. The Company has not obtained formal title reports on any
      of
      its properties and title may be in doubt. If title is disputed, the Company
      will
      have to defend its ownership through the courts. In the event of an adverse
      judgment, the Company would lose its property rights.





**The
      Mining Industry is Highly Competitive which could Restrict the Company’s
      Growth**


The
      Company competes with other corporations that may have greater resources. Such
      corporations could outbid the Company for potential projects or produce minerals
      at lower costs which would have a negative effect on the Company’s
      operations.****





**Mineral
      Operations are Subject to Market Forces Outside of the Company’s Control which
      could Negatively Impact the Company’s Operations**


The
      marketability of minerals is affected by numerous factors beyond the control
      of
      the entity involved in their mining and processing. These factors include market
      fluctuations, government regulations relating to prices, taxes, royalties,
      allowable production, import, exports and supply and demand. One or more of
      these risk elements could have an impact on costs of an operation and if
      significant enough, reduce the profitability of the operation and threaten
      its
      continuation.





**The
      Company is Subject to Substantial Government Regulatory Requirements which
      could
      cause a Restriction or Suspension of the Company’s
      Operations**


The
      Company’s exploration operations are affected to varying degrees by government
      regulations relating to resource operations, the acquisition of land, pollution
      control and environmental protection, safety, production and expropriation
      of
      property. Changes in these regulations or in their application are beyond the
      control of the Company and may adversely affect its operations, business and
      results of operations. Failure to comply with the conditions set out in any
      permit or failure to comply with the applicable statutes and regulations may
      result in orders to cease or curtail operations or to install additional
      equipment. The Company may be required to compensate those suffering loss or
      damage by reason of its operating or exploration activities. Operations may
      be
      affected in varying degrees by government regulations with respect to
      restrictions on production, price controls, export controls, foreign exchange
      controls, income taxes, expropriation of property, environmental legislation
      and
      mine safety.





Currently,
      the Company’s Canadian properties are subject to the jurisdiction of the federal
      laws of Canada, the provincial laws of British Columbia and the Northwest
      Territories, as well as local laws where they are located. In addition, the
      Company’s U.S. properties are subject to U.S. Federal laws, the state laws of
      Nevada and Oregon, as well as local laws where they are located. Mineral
      exploration and mining may be affected in varying degrees by government
      regulations relating to the mining industry. Any changes in regulations or
      shifts in political conditions are beyond the control of the Company and may
      adversely affect its business.




14
 Table
          of Contents




On
      the
      Federal and Provincial level, the Company must comply with exploration
      permitting requirements which require sound operating and reclamation plans
      to
      be approved by the applicable government body prior to the start of exploration.
      Depending upon the type and extent of the exploration activities, the Company
      may be required to post reclamation bonds and/or assurances that the affected
      areas will be reclaimed. Currently, the Company has estimated $1,406,734 in
      reclamation liabilities for its properties. $1,000,000 has been deposited for
      the benefit of the Province of British Columbia until released or applied to
      reclamation costs. If the reclamation requires funds in addition to those
      already allocated, Seabridge could be forced to pay for the extra work and
      it
      could have a significant negative effect upon the Company’s financial position
      and operations.





On
      the
      State and Provincial level, the government has jurisdiction over certain
      properties and requires their own permitting and compliance with applicable
      regulations. On the local level, regulations deal primarily with zoning, land
      use and specific building permits, as well as taxation and the impact of the
      Company’s operations on the existing population and local services.





**The
      Company is Subject to Substantial Environmental Requirements which could cause
      a
      Restriction or Suspension of Company Operations**


In
      connection with its operations and properties, the Company is subject to
      extensive and changing environmental legislation, regulation and actions. The
      Company cannot predict what environmental legislation, regulation or policy
      will
      be enacted or adopted in the future or how future laws and regulations will
      be
      administered or interpreted. The recent trend in environmental legislation
      and
      regulation generally is toward stricter standards and this trend is likely
      to
      continue in the future. The recent trend includes, without limitation, laws
      and
      regulations relating to air and water quality, mine reclamation, waste handling
      and disposal, the protection of certain species and the preservation of certain
      lands. These regulations may require obtaining permits or other authorizations
      for certain activities. These laws and regulations may also limit or prohibit
      activities on certain lands lying within wetland areas, area providing for
      habitat for certain species or other protected areas. Compliance with more
      stringent laws and regulations, as well as potentially more vigorous enforcement
      policies or stricter interpretation of existing laws, may necessitate
      significant capital outlays, may materially affect the Company’s results of
      operations and business, or may cause material changes or delays in the
      Company’s intended activities.





On
      the
      Federal, State and Provincial level, regulations deal with environmental quality
      and impacts upon air, water, soils, vegetation and wildlife, as well as
      historical and cultural resources. Approval must be received from the applicable
      bureau and/or department before exploration can begin, and will also conduct
      ongoing monitoring of operations. If operations result in negative effects
      upon
      the environment, government agencies will usually require the Company to provide
      remedial actions to correct the negative effects.




15
 Table
          of Contents




Specific
      to its U.S. properties, costs involved with complying with various government
      environmental regulations vary by anticipated operations. Typically, surface
      sampling does not require any permits. Agency review and approval for
      exploration drilling and access construction can vary from several hundred
      dollars to several thousands of dollars, depending upon the level of activity.
      Permitting and environmental compliance costs vary, depending upon the level
      of
      activities proposed and the sensitivity of the areas where mineral activities
      are proposed. As a general rule, these costs makeup 10% or less of the total
      cost amount of the program. The Company also may be required to post reclamation
      bonding and assurance that areas will be reclaimed after exploration. These
      bonds and guarantees range from approximately $1,000 on a small-scale
      exploratory drill program in Nevada to approximately $150,000 on an advanced
      exploration program in Oregon.





At
      present, the Company has not estimated or allocated any funds for reclamation
      at
      its Courageous Lake property, nor have any specific environmental concerns
      been
      identified. However, the history of mining and exploration of the property
      by
      others may have caused certain environmental damage which will require cleanup
      funded by Seabridge as the current landholder. In addition, unidentified
      environmental deficiencies may exist on other of the Company’s properties. The
      discovery of and any required reclamation of any additional properties would
      likely have a negative effect on the Company’s operations and financial
      position.





Financing
      Risks





**The
      Company is Likely to Require Additional Financing which Could Result in
      Substantial Dilution to Existing Shareholders and/or the Delay or Cessation
      of
      Operations**


The
      Company, while engaged in the business of exploiting mineral properties, has
      sufficient funds to undertake its planned current exploration projects. If
      the
      Company’s exploration programs are successful, additional financing will be
      required to develop the mineral properties identified and to place them into
      commercial production. The exploration of the Company’s mineral properties is,
      therefore, dependent upon the Company’s ability to obtain financing through the
      joint venturing of projects, debt financing, equity financing or other means.
      Such sources of financing may not be available on acceptable terms, if at all.
      Failure to obtain such financing may result in delay or indefinite postponement
      of exploration work on the Company’s mineral properties, as well as the possible
      loss of such properties. Any transaction involving the issuance of previously
      authorized but unissued shares of common or preferred stock, or securities
      convertible into common stock, could result in dilution, possibly substantial,
      to present and prospective holders of common stock. These financings may be
      on
      terms less favorable to the Company than those obtained previously.





**The
      Company Has a History of Net Losses and Expects Losses to Continue for the
      Foreseeable Future**


The
      Company has had a history of losses and there is no assurance that it can reach
      profitability in the future. As of the end of the last fiscal year dated
      December 31, 2005,




16
 Table
          of Contents




the
      Company historical net loss totals ($18,509,113). The Company will require
      significant additional funding to meet its business objectives. Capital will
      need to be available to help maintain and to expand exploration on the Company’s
      principal exploration property. The Company may not be able to obtain additional
      financing on reasonable terms, or at all. If equity financing is required,
      as
      expected, then such financings could result in significant dilution to existing
      shareholders. If the Company is unable to obtain sufficient financing, the
      Company might have to dramatically slow exploration efforts and/or lose control
      of its projects. The Company has historically obtained the majority of its
      financing through the issuance of equity, there is no limit to the number of
      authorized common shares, and the Company has no current plans to obtain
      financing through means other than equity financing.




**The
      Company has a Lack of Cash Flow to Sustain Operations and Does Not Expect to
      Begin Receiving Operating Revenue in the Foreseeable
      Future**


None
      of
      the Company’s properties have advanced to the commercial production stage and
      the Company has no history of earnings or cash flow from operations. The Company
      has paid no dividends on its shares since incorporation and does not anticipate
      doing so in the foreseeable future. Historically, the only source of funds
      available to the Company has been through the sale of its common shares and
      convertible debt instruments. Any future additional equity financing would
      cause
      dilution to current stockholders. If the Company does not have sufficient
      capital for its operations, management would be forced to reduce or discontinue
      its activities which would likely have a negative effect on the stock
      price.





**The
      Company Operates in Foreign Countries and is Subject to Currency Fluctuations
      which could have a Negative Effect on the Company’s Operating
      Results**


While
      engaged in the business of exploiting mineral properties, the Company’s
      operations outside of Canada, i.e. in the United States, make it subject to
      foreign currency fluctuation as the Company’s accounts conducted in Canadian
      dollars while certain expenses are numerated in US dollars. Such fluctuations
      may have adversely affected the Company’s financial positions and results.
      Management may not take any steps to address foreign currency fluctuations
      that
      will eliminate all adverse effects and, accordingly, the Company may suffer
      losses due to adverse foreign currency fluctuations.





Risks
      Relating to an Investment in the Securities of the Company





**The
      Market for the Company’s Stock has Been Subject to Volume and Price Volatility
      which Could Negatively Effect a Shareholder’s Ability to Buy or Sell the
      Company’s Shares**


The
      market for the common shares of the Company may be highly volatile for reasons
      both related to the performance of the Company or events pertaining to the
      industry (i.e., mineral price fluctuation/high production costs/accidents)
      as
      well as factors unrelated to the Company or its industry. In particular, market
      demand for products incorporating minerals in their manufacture fluctuates
      from
      one business cycle to the next, resulting in change of demand for the mineral
      and an attendant change in the price for the mineral. The Company’s common
      shares can be expected to be subject to volatility in both price and




17
 Table
          of Contents




volume
      arising from market expectations, announcements and press releases regarding
      the
      Company’s business, and changes in estimates and evaluations by securities
      analysts or other events or factors. In recent years the securities markets
      in
      the United States and Canada have experienced a high level of price and volume
      volatility, and the market price of securities of many companies, particularly
      small-capitalization companies such as the Company, have experienced wide
      fluctuations that have not necessarily been related to the operations,
      performances, underlying asset values, or prospects of such companies. For
      these
      reasons, the shares of the Company’s common shares can also be expected to be
      subject to volatility resulting from purely market forces over which the Company
      will have no control. Further, despite the existence of markets for trading
      the
      Company’s common shares in Canada and the United States, stockholders of the
      Company may be unable to sell significant quantities of common shares in the
      public trading markets without a significant reduction in the price of the
      stock.





**The
      Company has a Dependence Upon Key Management Employees, the Absence of Which
      Would Have a Negative Effect on the Company’s Operations**


The
      Company strongly depends on the business and technical expertise of its
      management and key personnel, including Rudi Fronk, President. There is little
      possibility that this dependence will decrease in the near term. As the
      Company’s operations expand, additional general management resources will be
      required. The Company may not be able to attract and retain additional qualified
      personnel and this would have a negative effect on the Company’s operations. The
      Company does not carry any formal services agreements between itself and its
      officers/directors. The Company does not carry any “Key Man” Life Insurance.





**Certain
      Officers and Directors May Have Conflicts of Interest Which Could have a
      Negative Effect on the Company’s Operations**


Certain
      of the directors and officers of the Company are also directors and/or officers
      and/or shareholders of other natural resource companies. While the Company
      was
      engaged in the business of exploiting mineral properties, such associations
      may
      have given rise to conflicts of interest from time to time. The directors of
      the
      Company are required by law to act honestly and in good faith with a view to
      the
      best interests of the Company and to disclose any interest that they may have
      in
      any project or opportunity of the Company. If a conflict of interest arises
      at a
      meeting of the board of directors, any director in a conflict must disclose
      his
      interest and abstain from voting on such matter. In determining whether or
      not
      the Company will participate in any project or opportunity, the directors will
      primarily consider the degree of risk to which the Company may be exposed and
      its financial position at the time.





**The
      Company Could be Deemed a Passive Foreign Investment Company Which Could have
      Negative Consequences for U.S. Investors**


The
      Company could be classified as a Passive Foreign Investment Company (“PFIC”)
      under the United States tax code. If the Company is declared a PFIC, then owners
      of the Company’s Common Stock who are U.S. taxpayers generally will be required
      to treat any so-called "excess distribution" received on its common shares,
      or
      any gain realized upon a disposition of common shares, as ordinary income and
      to
      pay an





18
 Table
          of Contents




interest
      charge on a portion of such distribution or gain, unless the taxpayer makes
      a
      qualified electing fund ("QEF") election or a mark-to-market election with
      respect to the Company’s shares. A U.S. taxpayer who makes a QEF election
      generally must report on a current basis its share of the Company’s net capital
      gain and ordinary earnings for any year in which the Company is classified
      as a
      PFIC, whether or not the Company distributes any amounts to its shareholders.
      U.S. investors should consult with their tax advisors for advice as to the
      U.S.
      tax consequences of an investment in the Common Stock.





**U.S.
      Investors May Not Be Able to Enforce Their Civil Liabilities Against The Company
      or Its Directors, Controlling Persons and Officers**


It
      may be
      difficult to bring and enforce suits against the Company. The Company is a
      corporation incorporated in Canada under the *Canada Business Corporation
      Act*. A majority of the Company’s directors and officers are residents of
      Canada and a substantial portion of the Company’s assets and its subsidiaries
      are located outside of the United States. Consequently, it may be difficult
      for
      United States investors to effect service of process in the United States upon
      those directors or officers who are not residents of the United States, or
      to
      realize in the United States upon judgments of United States courts predicated
      upon civil liabilities under United States securities laws. There is substantial
      doubt whether an original action could be brought successfully in Canada against
      any of such persons or the Company predicated solely upon such civil liabilities
      under the U.S. Securities Act.




**Forward
      Looking Statements**




Certain
      Statements presented herein contain certain forward-looking statements relating
      but not limited to the Company’s expectations, intentions, plans and beliefs.
      Forward-looking information can often be identified by forward-looking words
      such as “anticipate”, “believe”, “expect”, “goal”, “plan”, “intend”, “estimate”,
“may” and “will” or similar words suggesting future outcomes, or other
      expectations, beliefs, plans, objectives, assumptions, intentions or statements
      about future events or performance. Forward-looking information may include
      reserve and resource estimates, estimates of future production, unit costs,
      costs of capital projects and timing of commencement of operations, and is
      based
      on current expectations that involve a number of business risks and
      uncertainties. Factors that could cause actual results to differ materially
      from
      any forward-looking statement include, but are not limited to, failure to
      establish estimated resources and reserves, the grade and recovery of ore which
      is mined varying from estimates, capital and operating costs varying
      significantly from estimates, delays in obtaining or failures to obtain required
      governmental, environmental or other project approvals, inflation, changes
      in
      exchange rates, fluctuations in commodity prices, delays in the development
      of
      projects and other factors. Forward-looking statements are subject to risks,
      uncertainties and other factors that could cause actual results to differ
      materially from expected results.





Potential
      shareholders and prospective investors should be aware that these statements
      are
      subject to known and unknown risks, uncertainties and other factors that could
      cause





19
 Table
          of Contents




actual
      results to differ materially from those suggested by the forward-looking
      statements. Shareholders are cautioned not to place undue reliance on
      forward-looking information. By its nature, forward-looking information involves
      numerous assumptions, inherent risks and uncertainties, both general and
      specific, that contribute to the possibility that the predictions, forecasts,
      projections and various future events will not occur. The Company undertakes
      no
      obligation to update publicly or otherwise revise any forward-looking
      information whether as a result of new information, future events or other
      such
      factors which affect this information, except as required by law.




**Item
      4.****Information on the
      Company**




**DESCRIPTION
      OF BUSINESS**





**Introduction**





The
      Company’s executive office is located at:


172
      King
      Street East, 3rd Floor, Toronto, Ontario M5A 1J3 Canada


Telephone:
      (416) 367-9292


Facsimile:
      (416) 367-2711


E-Mail:
      info@seabridgegold.net


Website:
      www.seabridgegold.net





The
      Contact person in Toronto is Rudi Fronk, President and CEO.





The
      Company currently leases its executive offices in Toronto on a sub-lease from
      the Academy of Canadian Cinema and Television. The lease covers the entire
      3rd floor of a building located at 172 King Street East, Toronto,
      Ontario, Canada. The original sublease was effective January 21, 1999 and
      expired February 28, 2004. The sublease was renewed commencing March 1, 2004
      and
      expires February 28, 2009. The initial rent was for $4,265 per month, and is
      adjusted annually based upon a building cost operating adjustment. Current
      monthly rent is approximately $3,900.





The
      Company's fiscal year ends December 31st.





The
      Company's common shares trade on the TSX Venture Exchange under the symbol
      "SEA"
      and on the American Stock Exchange under the symbol “SA”.





The
      authorized share capital of the Company consists of an unlimited number of
      common shares and an unlimited number of preferred shares. As of December 31,
      2005, the end of the most recent fiscal year, there were 32,106,685 common
      shares issued and outstanding and no preferred shares issued and outstanding.





20
 Table
          of Contents




**Corporate
      Background**





The
      Company was originally incorporated under the Company Act of British Columbia
      under the name of Chopper Mines Ltd. on September 14, 1979. After conducting
      a 1
      for 5 reverse split, the Company changed its name to Dragoon Resources Ltd.
      on
      November 9, 1984. On May 20, 1998, the Company conducted a 1 for 10 reverse
      split and changed its name to Seabridge Resources Ltd. On June 20, 2002, the
      Company changed its name to Seabridge Gold Inc. in order to better reflect
      the
      Company’s focus on gold and gold projects. On October 31, 2002 the Company also
      continued from British Columbia into Canadian Federal jurisdiction under the
      Canada Business Corporations Act.





The
      Company presently has three active subsidiaries: Seabridge Gold Corporation,
      a
      Nevada corporation; Pacific Intermountain Gold Inc., a Nevada corporation;
      and
      5073 N.W.T. Limited, a company incorporated under the laws of the Northwest
      Territories of Canada. The following diagram illustrates the current
      inter-corporate relationship between the Company and its material
      subsidiaries:












(1)
            The
                Company's 100% interest in the Kerr-Sulphurets property is subject
                to the
                terms of an option agreement with Noranda Inc. under which Falconbridge
                Inc. can earn up to a 65% interest in the property. See "Narrative
                Description of the Business - Kerr Sulphurets Project -
                Summary".




(2)
            The
                Company's
                100% interest in the Quartz Mountain project is subject to the terms
                of an
                option agreement with Quincy Energy Corp. under which Quincy can
                earn up
                to a 62.5% interest in the
                property.




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Currently,
      the Company conducts operations in both Canada and the United States. As of
      December 31, 2005, the Company’s non-current assets were located as
      follows:




United
                  States:
              $  8,073,361
 Canada:
              $
                  18,115,037





**History
      and Development of the Business**





On
      May
      20, 1998, the Company completed a 1 for 10 reverse split and changed its name
      to
      Seabridge Resources Inc.





In
      October 1999, the Company initiated a corporate strategy based on its belief
      that the then depressed gold market offered significant upside potential. In
      October 1999, a new Board and senior management team possessing the required
      technical and financial skills to implement the new strategy were put in place.
      The new corporate direction was to acquire gold mining assets, including
      developed resources and shutdown or suspended projects, which had been made
      available by depressed gold prices and a lack of capital and which were
      uneconomic at the current gold price. The Company observed that projects that
      previously commanded significant market capitalization when gold prices were
      higher were becoming available at fractions of their previous valuations. The
      success of this new strategy was dependent on a return to higher gold prices.
      From October 1999 through June 2002 the Company acquired eight North American
      based gold projects which collectively contain substantial gold resources.





With
      the
      recent improvement in gold prices, the Company has commenced engineering studies
      and exploration activities on several of its projects. In addition, the Company
      has entered into joint venture agreements on some of its projects where partners
      will be conducting exploration activities.





In
      February 2000, the Company acquired an option to purchase 100% of the Grassy
      Mountain gold project located in eastern Oregon from Atlas Precious Metals
      Inc.
      In March 2003, the Company completed the purchase of the Grassy Mountain project
      by paying Atlas US$600,000.





In
      June
      2000, the Company entered into a Letter of Intent with Placer Dome (CLA) Limited
      to acquire a 100% interest in the Kerr-Sulphurets project located in the
      Iskut-Stikine River region, approximately 20 km southeast of the Eskay Creek
      Mine in British Columbia. The Company agreed to issue Placer 500,000 common
      shares, 500,000 common share purchase warrants exercisable at $2.00 per share
      for two years and grant a 1% NSR royalty for the property. In June 2001,
      Seabridge completed the acquisition of Placer Dome’s 100% interest in the
      project. In September 2002, the Company announced it had entered into an
      agreement with Noranda Inc. (now named Falconbridge Limited) whereupon
      Falconbridge can earn a 50% interest in the project by spending $6,000,000
      on
      exploration at the project within 6 years. Falconbridge can earn an additional
      15% interest by funding all costs to complete a feasibility study. If, after
      earning its 50%




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interest,
      Falconbridge elects not to proceed with a feasibility study, Seabridge has
      the
      option to acquire Falconbridge’s interest for $3,000,000. After having earned
      its 50% interest, Flaconbridge has the right to delay its decision to proceed
      with a feasibility study for up to three years by either spending $1.25 million
      per year on the property or making payments to Seabridge which would total
      $1.5
      million over the three-year period. Through December 31, 2005, Falconbridge
      has
      expended approximately $2.3 million towards its initial earn-in requirement.




In
      October 2000, the Company acquired a 100% leasehold interest in the Castle/Black
      Rock gold project in Esmeralda County, Nevada. The Company issued 5,000 common
      shares and paid US$7,500 in advance royalty payments and agreed to payments
      of
      up to $25,000 per year as well as granting a sliding 3-5% NSR on precious metals
      and a 3.5% NSR from all other metals produced to Platoro West Inc. in exchange
      for a 100% interest in the project.




In
      November 2000, the Company acquired a 100% leasehold interest in the Hog Ranch
      gold project in northern Nevada. The Company paid Platoro West Inc. US$75,000
      and issued 500,000 common shares to Platoro for a 100% interest in the project.
      The Company also granted Platoro a sliding 3-5% NSR on precious metals produced
      and a 3.5% NSR from all other metals produced. In August 2003, the Company
      granted Romarco Minerals an option to earn a 60% interest in the Hog Ranch
      gold
      project in Nevada. Romarco can earn a 60% interest by spending $2.5 million
      in
      exploration and project holding costs and issuing to the Company 1.5 million
      Romarco common shares, by December 31, 2007. In February 2005, Romarco
      terminated its interest in Hog Ranch and the property reverted to the
      Company.





In
      December 2001, the Company entered into an agreement to acquire a 100% interest
      in the Quartz Mountain Gold Project located in Lake County, Oregon. Seabridge
      agreed to pay to Quartz Mountain Gold Corporation US$100,000 cash, 300,000
      shares, 200,000 warrants and a 1% NSR for Quartz Mountain’s 100% interest in the
      project. In addition, the Company agreed to pay a 0.5% NSR on the property
      as a
      finders fee. The acquisition was completed in January 2002. In October 2003
      the
      Company granted Quincy Resources Inc. (now known as Quincy Energy Corp.) an
      option to earn a 50% interest in the Quartz Mountain gold project, excluding
      the
      existing gold resources. Under certain conditions Quincy can increase its
      interest to 62.5%.





In
      December 2001, the Company entered into an agreement to acquire a 100% interest
      in the Red Mountain Gold Project and related assets located near Stewart,
      British Columbia. Seabridge agreed to issue to North American Metals Corporation
      800,000 common shares in exchange for a 100% interest in the project and the
      assumption by Seabridge of all liabilities, including reclamation and underlying
      lease obligations, associated with the project. The transaction was completed
      in
      April 2002. In 2003, the Company commissioned SRK to undertake an engineering
      study on the Red Mountain project. The SRK study was completed in August
      2003.





In
      May
      2002, the Company reached agreement to purchase a 100% interest in the
      Courageous Lake Project located in the Northwest Territories, Canada. Seabridge
      paid former owners Newmont Canada Limited and Total Resources (Canada)
      US$2,500,000




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and
      granted a 2.0% NSR for 100% of the project. Seabridge also agreed to pay Newmont
      and Total up to an additional US$3,000,000 depending upon the price of gold.
      The
      purchase was closed in July 2002. In April 2003, the Company made a US$1,500,000
      payment to Newmont and Total which was triggered by the price of gold reaching
      US$360 per ounce. A final payment of US$1,500,000 was due to Newmont and Total
      when the price of gold exceeds US$400 for 10 consecutive days. This final
      payment was made in February 2004. In 2004, an additional property was optioned
      in the area (“Red 25”). Under the terms of the agreement, the Company paid
      $50,000 on closing and is required to make option payments of $50,000 on each
      of
      the first two anniversary dates and subsequently $100,000 per year. In addition,
      the property may be purchased at any time for $1,250,000 with any option
      payments being credited against the purchase price. From 2003 through 2005,
      the
      Company completed significant exploration activities at the project including
      core drilling. In September 2005 an independent engineering study was completed
      on the project.





In
      June
      2002, the Company and an independent third-party incorporated a Nevada company
      named Pacific Intermountain Gold Corp. (“PIGCO”) to acquire and explore
      early-stage exploration projects which have previously identified gold systems
      potentially capable of hosting large-scale gold deposits. In July 2004, the
      Company acquired a 100% interest in PIGCO by forgiving debt of approximately
      $65,000 and agreeing to pay 10% or any sale of PIGCO projects to third parties.
      The Company intends to explore some of the acquired properties itself and form
      joint ventures to explore the remainder.





**Business
      Overview**





All
      of
      the Company’s operations are located in Canada and the United States. The
      Company operates in the mineral exploration sector.





**All
      of the Company’s properties are currently at the exploration stage. There is no
      assurance that an economic and commercially viable deposit exists on any of
      the
      Company’s properties, and substantial additional work will be required in order
      to determine if any economic and legally feasible deposits occur on the
      Company’s properties.**





Operations
      are not seasonal as the Company can conduct exploration at certain of its
      properties year-round. To date, the Company’s income has been limited to
      interest on its cash balances and therefore it is not currently dependent upon
      market prices for its operations, nor is it dependent upon any patents, licenses
      or manufacturing processes.





The
      mineral exploration operations of the Company are subject to regulation by
      several government agencies at the Federal, Provincial and local levels. These
      regulations are well documented and a fundamental aspect of operations for
      any
      resource company in Canada and the United States. Management believes the
      Company is in compliance with all current requirements and does not anticipate
      any significant changes to these regulations which will have a material effect
      on the Company’s operations. The




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Company
      has obtained all material permits required for its anticipated exploration
      activities.





**Mineral
      Properties**





The
      Company currently operates in the mineral exploration sector. All of the
      Company’s properties are located in Canada and the United States and are at the
      exploration stage.












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The
      individual mineral properties are described below.





**Courageous
      Lake Project**





The
      Courageous Lake project is a gold project covering approximately 67,000 acres
      located in the Northwest Territories, Canada. Seabridge has a 100% interest
      in
      the project, subject to a 2% NSR on certain portions of the
      property. **The Property is without known mineral reserves and is at
      the exploration stage; The Company’s current efforts are exploratory in
      nature.**





**Location
      and Access**





The
      project is located approximately 240 kilometers northeast of Yellowknife in
      the
      Northwest Territories. Year round access is available by air, either by fixed
      wing aircraft to the airstrip at the former Salmita mine 6 kilometers to the
      south or via float-equipped aircraft to several adjacent lakes. During
      mid-winter, access is available via a winter road. There are about 10 kilometers
      of gravel roads located on the property.




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**How
      Acquired**




In
      May
      2002, Seabridge entered into a purchase agreement with Newmont Canada Limited
      and Total Resources Canada Limited on the Courageous Lake project comprised
      of
      17 mining leases covering 18,178 acres. Under the purchase agreement, Seabridge
      paid Newmont/Total US$2.5 million in cash and granted them a 2.0% NSR and agreed
      that it would be liable to make two (2) further payments of US$1.5 million,
      each
      subject to the price of gold passing certain thresholds, for a 100% interest
      in
      the property. A further US$1.5 million was paid to Newmont/Total in April 2003
      as a result of the spot price of gold closing above US$360 per ounce for 10
      consecutive days, which occurred in February 2003. A further US$1.5 was payable
      to Newmont/Total 60 days after the spot price of gold closes at or above US$400
      per ounce. This final payment was made in February 2004. The purchase by
      Seabridge closed on July 31, 2002. Upon acquiring the Courageous Lake project,
      Seabridge assigned its right thereto to its wholly owned subsidiary, 5073 N.W.T.
      Ltd. The obligations of 5073 N.W.T. Ltd. under the agreement, including the
      payment of the royalty, is secured by a debenture under which the vendors have
      been granted a security interest in the Courageous Lake property. Subsequent
      to
      this acquisition, Seabridge staked contiguous open ground totaling an additional
      48,905 acres in 42 mining claims of which a portion is subject to the terms
      of
      the purchase agreement, including the 2% royalty. In 2004, an additional
      property was optioned in the area (“Red 25”). Under the terms of the agreement,
      the Company paid $50,000 on closing and is required to make option payments
      of
      $50,000 on each of the first two anniversary dates and subsequently $100,000
      per
      year. In addition, the property may be purchased at any time for $1,250,000
      with
      any option payments being credited against the purchase price.





**Regional
      and Property Geology**





The
      Courageous-Matthews Lakes belt is characterized by a series of north to
      northwest trending Archean metavolcanic and metasedimentary rocks that are
      within the Yellowknife Supergroup and are locally referred to as the Courageous
      Lake Greenstone Belt (“CLGB”). The CLGB is approximately 60 kilometers long,
      with a maximum east-west width of 5.5 kilometers. Two distinct volcanic cycles
      have been recognized within the CLGB. The second cycle of volcanism is
      conformably overlain by a thick sequence of metasedimentary rocks that are
      locally known as the Yellowknife Group Sediments (“YGS”). The dominant post YGS
      lithology consists of large granodiorite to diorite plutons that bound the
      Courageous Lake deposit along its east and west flanks.





North
      of
      Matthews Lake, the Courageous Lake property consists of a sequence of northerly
      trending, steeply dipping metasedimentary and metavolcanic rocks, with tops
      to
      the east. All of the currently recognized gold occurrences on the property
      are
      located within or near the top of the second cycle of volcanism of the CLGB.
      Generally, the units that make up the second volcanic cycle are about 2
      kilometers thick and have been subdivided into 8 distinct mappable units.





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Both
      the
      main Tundra and carbonate zones within the Courageous Lake property strike
      north-south and have a near vertical dip component. The zones are characterized
      by moderate to intense shearing, sericite-carbonate alteration, and quartz
      veining. These mineralized zones are very persistent along strike and down
      dip.
      The continuity of gold mineralization has been demonstrated to be at least
      800
      meters along strike based upon previous drilling results. Within the area that
      has been tested by drilling, the continuity of gold mineralization is at least
      100 meters in a down dip direction. The limits of gold mineralization have
      not
      been fully tested and the deposit remains open along strike and down dip.





**Previous
      Exploration History**





Gold
      was
      first discovered in the Courageous Lake area in 1936. Beginning in 1976, Noranda
      Exploration Ltd. initiated exploration in the Courageous Lake Volcanic Belt.
      Exploration activities included geological reconnaissance, airborne, EM and
      magnetic surveys, ground follow-up and claim staking. In 1982, Noranda initiated
      a limited drill program to evaluate rock units north of Matthews Lake. Detailed
      geophysics, geological mapping, and extensive diamond drilling followed this
      initial program leading to the discovery of two gold deposits, the Tundra
      Deposit (Main Zone), known as the FAT Deposit, and the Carbonate Zone.





From
      1982
      to 1987, Noranda continued core drilling the property from the surface and
      also
      constructed a winter road to the property. They also began an environmental
      impact study. In late 1987, Noranda made the decision to sink a vertical shaft
      to provide access for conducting an underground definition drilling program
      and
      to be able to test gold grade continuity and tenor by drifting and raising
      on
      ore grade shoots. This also allowed Noranda to extract a bulk sample for
      metallurgical testing. In conjunction with the development of the shaft, surface
      core drilling, magnetic, VLF, and HLM surveys were also completed.





In
      late
      1987, Noranda completed an in-house preliminary resource estimate. Based upon
      this work, a two-year underground exploration program was initiated. The program
      was designed to establish an underground mining reserve, access material for
      bulk metallurgical sampling and provide engineering information for mine design
      and planning. The shaft was timbered and completed to a depth of 472.6 meters
      in
      April 1989. Drifting on the target zone occurred between May to November 1989
      and totaled 1,948.2 meters. Both lateral drifts and sub-vertical raises were
      completed and provided access to bulk sample locations and diamond drilling
      stations along the strike of the target zones. Approximately 200 vertical meters
      and 750 to 8000 of strike length of the mineralized zone were tested by
      underground drill holes. Additional horizontally fanned holes were drilled
      on
      25-meter centers to aid in the interpretation of the target zone. Underground
      drilling was completed in November 1989 and totaled 27,459.25 meters in 125
      diamond drill holes.





Little
      additional work was performed on the property until Placer Dome optioned the
      property in 1998. Placer’s exploration included a core drilling/sampling program
      in order





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to
      verify
      Noranda’s previous work and to provide infill sample data. Detailed mapping and
      structural analysis was done by Placer concurrent with the drilling to help
      design a drill plan as well as conducting a ground magnetic survey to define
      the
      zone of mineralization. Placer utilized two diamond drill rigs to provide
      detailed information on the continuity of the Tundra Main Zone and to confirm
      the Carbonate Zone. The total diamond drilling completed by Placer was 15,988
      meters in 76 drill holes. Placer dropped its option on the property in
      1999.





**Environmental/Regulatory
      Information**





As
      part
      of its due diligence review on the property, Seabridge engaged EBA Engineering
      Consultants Ltd. of Yellowknife, Northwest Territories, to prepare an
      Environmental Review of the Courageous Lake property. EBA determined the
      governmental environmental review process in the NWT would likely take 24 to
      36
      months from the time a Project Description Report had been filed with the
      authorities before the review process began. An additional 12 to 16 months
      would
      likely be required to complete the regulatory review process, all at a cost
      of
      $2-8 million, plus another $0.5-1 million for costs during the regulatory phase.





Additionally,
      EBA visited and evaluated the site for any current or potential environmental
      damage related to historical exploration work conducted at Courageous Lake
      by
      previous operators. EBA found no significant environmental concerns, but did
      note several areas of potential concerns, including the existing land
      disturbances, acid rock drainage from waste rock and drill casings.





Seabridge
      began to collect environmental data at their Courageous Lake, NWT property
      in
      2003. The data collection was designed and implemented by EBA Engineering
      Conslutants Ltd. To date the data includes archaeology, fisheries, water
      quality, hydrology and wildlife. The environmental program in 2004 and 2005
      included water quality, hydrology and wildlife. The results are summarized
      below.





*Wildlife:*


Caribou:
      Four aerial caribou surveys were flown (September and November 2004, and July
      and September 2005). The results indicated that the general area of the property
      is used by baren ground caribou during both the southward migration in the
      fall
      and the northward migration in the spring. No caribou were noted in the area
      during the winter months and limited numbers in the summer months. The southward
      migration appears to occur between August and October and the northward
      migration between April and June.





Grizzly
      Bear: Aerial and ground surveys were conducted in 2004 and 2005 to document
      grizzly and wolf dens occurring within the study area. Over the two years twelve
      bears were sighted; in 2004 a single adult, one female with one cub, and one
      female with three cubs seven grizzly bears, two new dens, and three old bear
      dens and in 2005 one female with two cubs, one large adult male, and one adult
      of unknown sex were documented. Over the same period dens observed included
      two
      used the previous winter and four old dens.





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Wolves:
      Observations of wolves, wolf activity, and wolf dens documented one active
      den,
      one inactive den site and 24 observations of wolf sign in 2004; two additional
      old wolf dens and two adult wolves were observed in 2005.





*Hydrology*


During
      the summer and fall of 2005 a hydrometric survey of Matthews Creek was
      conducted. The maximum-recorded discharge of 1.2 m3/s for Matthews Creek
      occurred on June 24, 2005 and a minimum flow of 0.2 m3/s was recorded on
      September 22, 2005 just prior to the creek freezing over. The instrumentation
      installed recorded flow continuously for the period.





*Water
      Quality*





Four
      water quality, sampling stations were located on Matthews Lake, one station
      at
      Courageous Lake, and one on Matthews Creek and were sampled twice during the
      open water season in both 2004 and 2005. Samples were analyzed for total and
      dissolved ultra-low metals (both total and dissolved), low-level nutrients,
      routine water, and cyanide as well as temperature, conductivity and dissolved
      oxygen. In general, the physical and chemical water quality parameters in the
      area of the Courageous project are generally pristine. Some impacts of the
      abandoned Tundra mine on Matthews Lake, could be noted in the concentrations
      of
      aluminum, cadmium, copper, and mercury.





*2006
      Program*





The
      environmental field program in 2006 will concentrate on documenting the
      hydrology of Matthews Creek. A detailed design of the environmental data
      collection program to support the application to the McKenzie Valley Land and
      Water Board for development licenses and permits will also be
      completed.





**Current
      and Planned Work**





In
      late
      2002, Seabridge engaged a group of independent consulting firms to undertake
      an
      engineering study for Courageous Lake. During 2003, preliminary reports were
      completed on key mining and metallurgical issues relating to the project. In
      January 2004, Seabridge authorized the independent consultants to upgrade
      capital and operating cost estimates in its Courageous Lake study to
      pre-feasibility levels to better define the economics of the project. As a
      result of a 2004 drilling program, the Company commissioned a new independent
      resource estimate for the FAT deposit which was completed in December 2004
      and
      was incorporated into the engineering study. The engineering study was completed
      in September 2005 and the results are presented below.




During
      a
      2003 summer exploration program, Seabridge successfully identified 12 gold
      targets at Courageous Lake with characteristics similar to the existing FAT
      zone
      at the project. The Company also identified significant drill core from previous
      owners of these targets which had not been assayed. The drill core, an estimated
      110,000 meters, was retained on the property but never evaluated for bulk
      mineable potential. From September





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through
      December of 2003, Seabridge conducted a program to evaluate and prioritize
      these
      12 targets by sampling and assaying available core. The results from this
      program confirmed that nine of the 12 targets have the potential to host bulk
      mineable deposits similar to FAT. Of these nine targets, four have been
      consolidated into what is now called the Salmita Zone and five have been
      consolidated into what is now called the Tundra Zone. A 10,000-meter core drill
      program was conducted by Seabridge during 2004 that focused on testing the
      Salmita and Tundra Zones as well as the potential strike extension of the FAT
      zone and the FAT hanging wall zone.





In
      2004,
      drill testing of selected priority targets was undertaken by the Company. The
      program was conceived in 2 stages, initial testing for strataform gold
      concentrations similar to the FAT Deposit and sectional drilling for potential
      resource additions. The initial program intended to test 3 target areas, Olsen
      Lake, Walsh Lake and the South FAT Extension. Ground conditions precluded a
      test
      of the Walsh Lake target, but the other targets were tested. Results from the
      initial stage of the program lead Seabridge to initiate sectional drilling
      on
      the South FAT Extension. The South FAT Extension was a projection of the
      previous resource model where little work had been completed. Surface and
      initial drilling results indicated that 300 meters of strike could be added
      to
      the FAT Deposit with the completion of sectional drilling. The second stage
      of
      the 2004 program completed the sectional drilling on 50-meter section lines
      across these 300 meters of strike.




A
      7,500
      meter core drill program was completed by the Company during 2005 designed
      to
      test for the north and south strike extensions of the FAT. The program
      demonstrated the potential to extend the FAT deposit by an additional 850 meters
      to the south and a further 600 meters to the north.





In
      September 2005, an engineering study (classified as a Preliminary Assessment
      under National Instrument 43-101 in Canada) for the Courageous Lake project
      was
      completed by TJS Mining-Met Services Inc. (TJS), Roscoe Postle Associates Inc.
      (RPA) and EBA Engineering Consultants Limited (EBA) (TJS, RPA and EBA
      collectively, the “Project Consultants”). The Preliminary Assessment is dated
      September 7, 2005 and is entitled “Seabridge Gold Inc., Courageous Lake Project,
      Preliminary Technical Assessment”. The independent consultants concluded that
      given the resource size, location and grade, a year round, open-pit bulk
      mineable operation with on-site processing is the most suitable development
      scenario. A base case scenario was developed for the project incorporating
      a
      25,000 tonne per day operation (9.0 million tonne per year throughput) resulting
      in a projected 8.5 year operation with average annual production of 545,000
      ounces of gold.





Work
      on
      the Courageous Lake project is ongoing to evaluate modifications which could
      improve project economics. The opportunities identified are as
      follows:





·
            Tailings
                options - further testwork may prove out paste tailings as an option
                which may reduce the tailings footprint, tailings capital and operating
                costs.





·
            All-weather
                road - providing an all-weather road to the site would have a large
                positive impact on the project. Such a road is being considered by
                the
                various levels




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of
      government. There would be a significant reduction in on-site storage
      requirements, especially fuel oil and lime.





·
            Power
                generation sharing - providing a network to share power between the
                mines in the area. There are three mines in the area that potentially
                could share power generating facilities and costs.





·
            Mine
                life extensions - the potential extension of mine life could have a
                positive material impact on the project's pre-tax net cash flow.
                The
                independent consultants have recommended additional exploration to
                follow-up on 2005’s exploration
                results.





The
      Company estimates its annual holding costs of the Courageous Lake Project to
      be
      $186,000 with $136,000 of these costs paid to the Department of Indian Affairs
      and Northern Development, Northwest Territories and the remaining $50,000 as
      an
      option payment on the Red 25 claim payable to Bathurst Inlet Developments (1984)
      Ltd.





**Mineral
      Resources**




Over
      the
      period of previous exploration at Courageous Lake, several resource estimates
      have been prepared. The most detailed historic estimates were conducted by
      Noranda in 1990 at the conclusion of its underground exploration program, by
      Placer Dome in 1999 at the conclusion of its exploration program and by Resource
      Modeling Inc. (an independent consulting firm based in Tuscon, Arizona) in
      July
      2002 as part of the Company’s due diligence when it acquired the project from
      Newmont and Total.




In
      December 2004, RMI completed a new resource model for Courageous Lake,
      incorporating the results from the Company’s 2004 exploration program. The study
      provided resource estimates at various cut-off grades. In September, 2005 an
      engineering study was completed for the project which indicated that a 0.83
      gram
      per tonne cut-off grade was appropriate for the deposit. Using its own
      estimation parameters and a cut-off grade of 0.83 grams of gold per tonne,
      RMI
      calculated resources for the project as follows:





Courageous
      Lake Gold Resources at 0.83 grams per tonne cut-off:




Measured
              IndicatedTonnes
                (000’s)
              Grade
                (g/T)
              Ounces
                (000’s)
              Tonnes
                (000’s)
              Grade
                (g/T)
              Ounces
                (000’s)3,378
              2.55
              277
              47,002
              2.28
              3,445




**Cautionary
      Note to U.S. Investors concerning estimates of Measured and Indicated
      Resources**


This
      section uses the terms “measured resources”, “indicated resources” and “inferred
      resources”. We advise U.S. investors that while those terms are recognized and
      required by Canadian regulations, the U.S. Securities and Exchange Commission
      does not recognize them. **U.S. Investors are**




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**cautioned
      not to assume that any part or all of mineral deposits in these categories
      will
      ever be converted into reserves.**





Courageous
      Lake Gold Inferred Resources at 0.83 grams per tonne cut-off




InferredTonnes
                (000’s)
              Grade
                (g/T)
              Ounces
                (000’s)77,442
              2.10
              5,229




**Cautionary
      Note to U.S. Investors concerning estimates of Inferred
      Resources**


This
      section uses the term “inferred resources”. We advise U.S. investors that while
      this term is recognized and required by Canadian regulations, the U.S.
      Securities and Exchange Commission does not recognize it. “Inferred resources”
have a great amount of uncertainty as to their existence, and great uncertainty
      as to their economic and legal feasibility. It cannot be assumed that all or
      any
      part of an Inferred Mineral Resource will ever be upgraded to a higher category.
      Under Canadian rules estimates of Inferred Mineral Resources may not form the
      basis of feasibility or other economic studies. **U.S. investors are
      cautioned not to assume that part or all of an inferred resource exists, or
      is
      economically or legally mineable.**





None
      of
      the resource can be classified as a Mineral Reserve. Additional exploration
      work
      will be required in order to upgrade the resources into reserve categories,
      and
      a full feasibility study will be required in order to determine if any of the
      mineral resource are economic and can be profitably mined.




The
      resource model constructed for the Courageous Lake deposit incorporates data
      from 449 holes drilled by Seabridge, Noranda and Placer Dome totaling 115,649
      meters. Block model gold grades in the Courageous Lake resource model were
      estimated using an inverse distance weighting interpolation procedure.





**Grassy
      Mountain Project**





The
      Grassy Mountain Property covers approximately 6.7 square miles or 4,300 acres,
      and is located in eastern Oregon. Seabridge has a 100% interest in the project.
      **The Property is without known mineral reserves and is at the exploration
      stage; The Company’s current efforts are exploratory in
      nature.**





**Location
      and Access**





The
      property consists of 320 unpatented lode claims of approximately 4,600 acres
      and
      lies approximately 22 miles southwest of Vale, Oregon and 70 miles west of
      Boise, Idaho. The property is accessed by traveling 4 miles west from Vale
      on US
      Highway 20,




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then
      south on the Twin Springs County Road for 23 miles, or by driving south from
      Nyssa, Oregon on US Highway 95 to Owyhee and then west to Rock Springs Canyon
      and by gravel road for 14 miles.











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**How
      Acquired**





In
      February 2000, Seabridge acquired an option to purchase 100% of the Grassy
      Mountain gold project located in eastern Oregon from Atlas Precious Metals
      Inc.
      The Company originally had until December 31, 2002 to acquire for
      US $1,700,000, a 100% interest in 214 mineral claims located in Malheur
      County, Oregon, USA. The purchase price was to be a combination of cash,
      Seabridge common shares and notes.





In
      December 2002, the Company and Atlas restructured the terms of the acquisition
      agreement due to Atlas’ preference for cash. In exchange for a US$300,000 option
      payment, Atlas granted Seabridge the right to acquire a 100% interest in the
      property for an additional US$600,000 cash payment on or before March 31, 2003.
      Seabridge also agreed to provide US$500,000 in financing for an Atlas subsidiary
      on or before March 31, 2003. Seabridge paid the US$300,000 option payment,
      as
      well as the US$600,000 cash payment and the US$500,000 in financing and now
      holds a 100% interest in the property as well as 1,000,000 common shares of
      the
      Atlas subsidiary.





The
      property lies on Bureau of Land Management (“BLM”) lands, and ownership includes
      four leasehold interests covering 76 unpatented lode and placer claims and
      an
      additional 138 unpatented lode claims. There is one Oregon State section within
      the property for which applications for State prospecting permits have been
      submitted. A sliding scale NSR royalty applies to the main Grassy Mountain
      deposit. The royalty rate is a 4% NSR for gold prices up to US$500 per ounce,
      to
      a maximum of 7% for gold prices above US$800 per ounce.





**Regional
      and Property Geology**





The
      property is situated in the Oregon Plateau portion of the northern Great Basin
      and is characterized by abundant Cenozoic volcanism. The flat-lying to gently
      dipping volcanics and volcanic sediments were deposited over wide areas during
      this time of crustal extension. The rocks exposed at Grassy Mountain are part
      of
      the late to middle-Miocene Grassy Mountain Formation; Mineralization is
      associated with a low-grade gold-silver bearing siliceous hot springs system
      with enrichment along multi-stage quartz-adularia veins and favorable
      lithologies. The mineralized rock is highly silicified and locally brecciated
      in
      the vicinity of the feeder structures. As silicification decreases so does
      grade. The finer grained siltstones contain the bulk of the lower grade
      material. The higher grades are found in the coarser arkosic
      sandstones.





**Previous
      Exploration History**




Atlas
      acquired the property in 1986 from two prospectors after recognizing its
      potential to host hot springs type gold mineralization. There were no
      significant mining or major mineral occurrences known in the area prior to
      the
      discovery of the Grassy Mountain Deposit.




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Detailed
      mapping and sampling were completed and Atlas drilled six holes on two target
      areas. A follow up drill program consisting of five holes was completed in
      the
      spring of 1988. Hole 26-9 is considered the discovery hole with 145 feet of
      mineralization averaging 0.075 opt Au. The claim block was expanded at this
      time
      and exploration work continued through 1991. Atlas completed 388 drill holes
      for
      a total of approximately 221,500 feet on the property.




In
      1990,
      Atlas commissioned Kilborn Engineering (“Kilborn”) to complete a feasibility
      study on Grassy Mountain. Based on the positive Kilborn study, Atlas sold the
      property to Newmont Exploration Ltd. in September 1992 for US$30 million plus
      a
      5% net smelter royalty interest. Newmont continued the property evaluation
      through August 1994, completing an additional 13 core and reverse circulation
      holes while concentrating on the higher-grade ore zones. At the conclusion
      of
      its exploration programs, Newmont determined the property did not currently
      meet
      its project criteria and returned the project to Atlas in September
      1996.




In
      January 1998, Atlas executed an agreement with Tombstone Exploration Company
      Ltd. and associated sister company Orinoco Gold Inc. ("Tombstone"), whereby
      Tombstone was granted the option to purchase 100% of the property. Exploration
      work during Tombstone's initial program at Grassy Mountain included 8,500 of
      reverse circulation and core drilling in 10 drill holes. Prior to the drill
      program and execution of the definitive option agreement, Tombstone completed
      an
      extensive review of previous work at the property and commissioned an economic
      study of alternative development scenarios by Pincock, Allen and Holt (“PAH”). A
      second phase drill program was proposed by Tombstone to assess the highly
      prospective structural trends identified by geophysics, and to upgrade previous
      mineralization models. Due to a downturn in the resource market and its
      resulting inability to raise venture capital during 1998 forced Tombstone to
      return Grassy Mountain to Atlas in May 1998.




**Environmental/Regulatory
      Information**





The
      Bureau of Land Management (BLM), through its Vale District office, is the lead
      agency responsible for the Grassy Mountain area. In 2000, Seabridge retained
      Gochnour & Associates of Parker, Colorado (“Gochnour”) to undertake an
      environmental review and regulatory permitting due diligence on Grassy Mountain.
      The report of Gochnour, prepared by Lee “Pat” Gochnour, is entitled “Grassy
      Mountain Project Permitting/Environmental Report” (the “P/E Report”) and dated
      June 27, 2000. The Gochnour study examined three potential scenarios: (1)
      open-pit mining with a combination of heap-leach and milling processing; (2)
      underground mining with on-site milling; and (3) underground mining with
      off-site milling. Gochnour concluded that each of the development scenarios
      is
      permittable under current federal and state law. To complete the permitting
      process, Gochnour estimates that the open-pit scenario would take 3-5 years
      to
      permit once a Plan of Operations (“POO”) had been submitted. Gochnour estimated
      the permitting time frame for the underground scenarios at 2-3 years after
      the
      POO was submitted. Gochnour also reviewed the extensive database of all previous
      environmental and baseline work and estimated the cost and time frame




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associated
      with bringing the work up to date. In aggregate, Gochnour estimated a minimum
      of
      one year to bring the base-line work up to date at a cost of approximately
      US$500,000. Gochnour recommended that this work be performed concurrently with
      the preparation of a final feasibility study.





**Current
      and Planned Work**





During
      2006, the Company plans to conduct a program to re-examine the economic
      potential for both the open pit and underground development scenarios at Grassy
      Mountain and choose the appropriate path for future work.





Holding
      costs of the property are currently approximately US$98,000 annually broken
      down
      as follows:





a)
            US$20,000
                paid to the United States Bureau of Land Management and Malheur County,
                Oregon;


b)
            US$35,000
                paid to Sherry & Yates, a Montana Corporation, as an annual advance
                royalty, escalating by US$5,000 per year to a maximum of US$60,000;


c)
            US$33,000
                paid to the Bishop family of Vale,
                Oregon;


d)
            Approximately
                US$10,000 in storage and warehouse
                fees.





**Kerr-Sulphurets
      Project**





The
      Kerr-Sulphurets Project consists of two separate gold properties, Kerr and
      Sulphurets, located in the Iskut-Stikine River region of British Columbia.
      Seabridge currently has a 100% interest in the project but is subject to an
      agreement with Noranda Inc. whereupon Noranda may earn an interest in the
      property. **The Property is without known mineral reserves and is at the
      exploration stage; The Company’s current efforts are exploratory in
      nature.**





**Location
      and Access**





The
      Kerr-Sulphurets property is located in the Iskut-Stikine River region,
      approximately 65 km northwest of Stewart, British Columbia. Access to the
      property is by helicopter from Stewart. Mobilization of equipment and personnel
      can be staged quite effectively from the Tide Lake airstrip, Bronson Strip
      or
      from Bob Quinn and Bell II Crossing on the Stewart Cassiar Highway.




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**How
      Acquired**





Seabridge
      entered into a Letter of Intent with Placer Dome in June 2000 to acquire a
      100%
      interest in Kerr-Sulphurets. On March 27, 2001, the Company and Placer Dome
      executed a definitive acquisition agreement and the acquisition closed in June
      2001. At closing, the Company issued Placer Dome (i) 500,000 common shares
      of
      Seabridge; (ii) 500,000 common share purchase warrants, exercisable by Placer
      Dome at C$2.00 per share for two years; and (iii) a 1% net smelter royalty
      interest on the Project, capped at C$4.5 million. Seabridge will be obligated
      to
      purchase the 1% net smelter royalty from Placer Dome for $4.5 million in the
      event that a positive feasibility study demonstrates a 10% internal rate of
      return after tax and financing costs.





The
      Kerr-Sulphurets project consists of two contiguous claim blocks known as the
      Kerr Property and the Sulphurets Property. Total minimum annual holding costs
      associated with the project are approximately $86,000.





**Property
      Description**





The
      Kerr
      Property consists of 18 mineral claims (190 units) and 10 placer claims along
      Sulphurets Creek. Annual assessment requirements or cash-in-lieu payments for
      the 190 Kerr units is approximately $40,000. The associated placer claims
      require annual rental payments totaling C$6,000.





The
      Sulphurets property consists of 40 mineral claims totaling 158 units. Annual
      assessment requirements for the 158 Sulphurets units are approximately $33,000.
      Three of the claims are subject to a contractual royalty obligation in
      accordance with terms in the underlying Dawson Agreement. The three claims
      were
      purchased from Mrs. Dawson in 1990, for a sum of US$25,000, subject to a net
      smelter return royalty of 2% of one-half of net smelter returns (effectively
      1%
      NSR) on ore production. The Dawson Royalty is capped at US$650,000 less the
      property purchase amount. Advance annual royalties of US$5,000 per year
      commenced on December 15, 1991, and may be bought out for US$450,000.





There
      is
      a further underlying agreement between Placer Dome Inc. and Newhawk Gold Mines
      Ltd. dated February 4, 1992, whereby the advance annual royalties payable to
      Dawson are being paid two-thirds by Placer Dome and one third by Newhawk. This
      split is based on the fact that two of three claims, namely the XRAY 2 and
      6,
      are now part of Placer Dome’s Sulphurets Property and the XRAY 8 is on Newhawk’s
      property.





**Regional
      and Property Geology**





The
      Kerr-Sulphurets property lies within the Stikine Terrane and is underlain
      largely volcanic, volcaniclastic and sedimentary rocks at the western edge
      of
      the Bowser Basin. Within this geologic framework, copper, gold and molybdenum
      mineralization and associated alteration are focused in a local core where
      intense folding, faulting, thrust faulting and intrusions are prevalent. A
      number of deformed porphyry and vein type




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deposits
      occur in the Mitchell-Sulphurets area. These deposits are characterized by
      a
      strong copper-gold and minor molybdenum association, and spatially occur along
      the flanks of a horseshoe-shaped trend.





The
      project consists of two separate gold zones, Kerr and Sulphurets. Each consists
      of separate and unique structures and are discussed separately
      below:





*Kerr
      Zone*


The
      Kerr
      deposit extends approximately 3,000 m in a northerly trend from the crest of
      a
      ridge above the southwestern branch of the Sulphurets Glacier down to the lower
      slopes of a cirque-like basin just above Sulphurets Lake. The deposit is a
      pyrite-rich copper-gold system that occurs in strongly altered and deformed
      monzonitic intrusions in sedimentary and volcaniclastic rocks. The most
      important mineralization type is quartz stockwork. The strongest copper-gold
      mineralization is associated with a core of chlorite-bearing alteration and
      quartz stockwork.





*Sulphurets
      Zone*


Disseminated
      copper-gold mineralization in the Sulphurets Gold Zone is centered about a
      hydrothermal breccia (Breccia Gold Zone) and dyke complex (Raewyn Copper-Gold
      Zone) representing the higher levels of a copper-gold porphyry system. The
      combined gold and copper lithogeochemical anomaly associated with the Sulphurets
      Gold Zone Target has a strike length of 2.5 kilometers by up to one kilometer
      in
      width.





**Exploration
      History**





Placer
      gold was discovered in Sulphurets Creek in the 1880s. In 1935, copper
      mineralization was discovered on Mitchell-Sulphurets Ridge in a location now
      known as the Main Copper Zone. In 1959, gold-silver mineralization was
      discovered in the Brucejack Lake area. These showings were subsequently explored
      with surface and underground exploration in the 1980s and 1990s as three
      comparatively small high-grade gold-silver zones by Newhawk Gold Mines Ltd.
      and
      Lacana Mining Corp.





In
      1960,
      claims on the Sulphurets property were staked by Granduc Mines Ltd. and some
      independent prospectors. Exploration including diamond drilling was completed
      over an eight-year period on Sulphurets Gold, Main Copper and Quartz Stockwork
      Zones by Granduc and the Newmont Mines Joint Venture. From 1971 to 1975 Granduc
      continued exploration on the Sulphurets Property. From 1980 to 1985, Esso
      Minerals optioned the Sulphurets Property from Granduc with in order to explore
      for porphyry molybdenum, bulk mineable copper-molybdenum-gold and gold-bearing
      vein type deposits. In 1985, Esso surrendered its interest in the Sulphurets
      Property to Granduc.





The
      Alpha
      Joint Venture (“Alpha”) staked the Kerr Property in 1982 Anomalous gold values
      in soils were identified in 1983 by Alpha and based on these results Brinco
      Limited optioned the Kerr Property in 1984 and funded the next phase of
      geological mapping, prospecting and geochemical sampling. This work outlined
      a
      gold anomaly over one kilometer long. In 1985, Newhawk Gold Mines Ltd. and
      Lacana Mining Corp.




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formed
      a
      joint venture, and optioned the adjoining Sulphurets Property from Granduc
      and
      explored several zones, including conducting diamond drilling.





In
      1989,
      fieldwork completed by Placer Dome included additional diamond drilling to
      extend the Kerr deposit to a strike length of more than 1,600 meters. In 1990,
      Placer Dome completed a major diamond drill program on the Kerr Property to
      further define the deposit. Placer further completed a major diamond drill
      program on the Sulphurets Gold Zones and adjoining Kerr deposit during the
      summer of 1992, with the total exploration expenditures incurred by Placer
      on
      the Kerr-Sulphurets property through to year-end 1992 was C$6.6 million.





**Environmental/Regulatory
      Information**





The
      Kerr-Sulphurets Property falls within the Cassiar-Iskut-Stikine Land and
      Resource Management Plans (LRMP). At this stage, there are no direct Protected
      or Special Management Areas overlapping the Kerr-Sulphurets Property. However,
      as negotiations on recommendations proceed, there may be potential Land Use
      conflicts arising from future allocations by the Regional Protected Areas Team
      in the vicinity of the Kerr-Sulphurets project. In particular, a
      Conservation-oriented Protection Area and large River Corridor Special
      Management Area are currently being recommended along the lower two-thirds
      of
      the Unuk River. The establishment of this type of Protected Area, although
      it
      does not overlap the Kerr-Sulphurets Property, could impact the approval process
      of potential development plans and valley access to the project.





Reclamation
      and decommissioning activities associated with previous exploration activities
      have been initiated and almost completed on the Kerr-Sulphurets Property. The
      main activities include response to periodic inspections by the British Columbia
      Ministry of Energy and Mines. There are a number of outstanding activities
      that
      are still required to be administered in accordance with recommendations
      from the Ministry including additional reclamation on drill access roads
      and equipment and material clean-up. The British Columbia Ministry of Energy
      and
      Mines estimates $225,000 of additional reclamation work may be required and
      the Company has deposited this amount under a safekeeping agreement with
      the Ministry for these obligations.





**Current
      and Planned Work**





On
      September 17, 2002, the Company entered into an agreement with Noranda Inc.
      (now
      known as Falconbridge Limited) whereupon Falconbridge may earn an interest
      in
      the project. The agreement allows Falconbridge to earn a 50% interest in the
      project by spending $6,000,000 on exploration within 6 years. Falconbridge
      may
      earn a further 15% by funding all costs to complete a feasibility study on
      the
      project. If, after earning its 50% interest, Falconbridge elects not to proceed
      with a feasibility study, Seabridge has the option to acquire Falconbridge’s
      interest for $3,000,000. After having earned its 50% interest, Falconbridge
      has
      the right to delay its decision to proceed with a feasibility study for up
      to
      three years by either spending $1.25 million per year on the property or making
      payments to Seabridge which would total $1.5 million over the three-year period.




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During
      2003 and 2004, Falconbridge conducted field programs at Kerr-Sulphurets designed
      to explore outside the known deposits in order to expand the known resources.
      The programs consisted of mapping, rock and soil sampling, and IP surveys.
      The
      size of mineralized zones at Iron Cap, Mitchell and Main Copper were expanded
      into areas of recent glacier retreat which were not accessible by Placer Dome.





During
      2005, Falconbridge completed a summer drill program consisting of 16
      widely-spaced core drill holes totaling 4,092 meters designed to test six
      targets situated outside the resources previously defined for the Kerr and
      Sulphurets deposits. Gold-copper mineralization was encountered at all six
      targets, with the Iron Cap and West Mitchell zones yielding the most encouraging
      results.





**Red
      Mountain Project**





The
      Red
      Mountain Project is a 20,175 hectares gold project located in northern British
      Columbia, Canada. Seabridge currently has a 100% interest in the project,
      subject to net smelter royalty obligations ranging from 2 to 6.5% on various
      segments of the property. **The Property is without known mineral reserves
      and is at the exploration stage; The Company’s current efforts are exploratory
      in nature.**





**Location
      and Access**





The
      Red
      Mountain project is situated in northwestern British Columbia near the town
      of
      Stewart, 880 km northwest of Vancouver and 180 km north of Prince Rupert. The
      property lies in the Skeena Mining Division, approximately 18 km east-northeast
      of the town of Stewart, at 55°57’N
      latitude and 129°42’
W
      longitude, between the Cambria Ice Field and the Bromley Glacier at elevations
      ranging between 1,500 and 2000 meters.





Access
      to
      the property is currently by helicopter from Stewart with a flight time of
      10
      to15 minutes. Road access along the Bitter Creek valley from Highway 37A was
      partially completed for 13 km by Lac Minerals in 1994 to the Hartley Gulch-Otter
      Creek area. Currently this road is passable for only a few kilometers from
      the
      highway. The remainder is not passable, as sections have been subjected to
      washout or landslide activity.




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**How
      Acquired**





Effective
      December 31, 2001, the Company agreed to acquire a 100% interest in the Red
      Mountain project from North American Metals Corp. (“NAMC”), a subsidiary of
      Wheaton River Minerals Ltd. (“WRM”). Closing of the acquisition was completed in
      April 2002. At closing, the Company issued NAMC 800,000 common shares of the
      Company in exchange for a 100% interest in the Red Mountain project which
      includes 106 mineral claims comprising 19,030 hectares; all project data
      including an extensive, high-quality data base and drill core repository; an
      office/warehouse building in Stewart; a large complement of mining equipment
      at
      the Red Mountain site which has been independently valued at approximately
      $0.5
      million; mineral exploration permit MX-1-422 and a related $1.5 million cash
      reclamation deposit lodged with the B.C. Mines Ministry. In January 2002, WRM
      filed a revised reclamation plan with the B.C. Mines Ministry which has reduced
      the $1.5 million cash reclamation deposit to $1.0 million. Of the $500,000
      that
      was released by the Ministry, $350,000 was retained by Seabridge and $150,000
      was paid to WRM. During 2003 Seabridge purchased additional claims at Red
      Mountain totaling 1,145 hectares.





At
      closing Seabridge also assumed obligations of various underlying property
      agreements which include net smelter royalty obligations ranging from 2 to
      6.5%,
      as well as an annual minimum royalty payment of $50,000 on the Wotan Resources
      Corp. (“Wotan”) claim group. Production from the Wotan claims, which contain the
      Red Mountain gold deposit, is subject to two separate royalties aggregating
      3.5%
      of net smelter returns (“NSR”), comprising a 1.0% NSR payable to Barrick and a
      2.5% NSR payable to Wotan.





The
      Company also paid a finder’s fee of 40,000 common shares of Seabridge in regards
      to the acquisition of the property.





**Regional
      and Property Geology**





Red
      Mountain is located near the western margin of the Stikine terrain in the
      Intermontane Belt. Structurally, Red Mountain lies along the western edge of
      a
      complex, northwest-southeast trending, doubly-plunging structural culmination,
      which was formed during the Cretaceous. Structural deformation at the property
      scale is consistent with the observations at the regional and tectonic
      scales.





**Previous
      Exploration History**





Prospecting
      and small-scale mining took place near Red Mountain, in the Bitter Creek Valley,
      as early as 1900 and persisted intermittently through the first half of the
      20th century. At that time much of Red Mountain was covered with snow
      or glacial ice. Since that time the glaciers have retreated significantly,
      exposing large portions of the summit and surrounding bedrock.





Porphyry
      molybdenum and copper occurrences in the immediate Red Mountain area were
      explored in the 1960s and 1970s. In 1965, molybdenum and native gold occurrences




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were
      discovered at McAdam Point, on the south side of Red Mountain. Additional small
      molybdenum showings were subsequently located and explored in the central cirque
      of Red Mountain. Gold exploration at Red Mountain then ceased as it was
      generally regarded as a setting favorable for porphyry style molybdenum
      mineralization.





Evaluation
      of the Red Mountain area for gold potential recommenced in 1987. The Wotan
      claims were staked in 1988 by local prospectors and optioned to Bond Gold in
      1989. In that year, gold mineralization that was the surface expression of
      the
      Marc zone was discovered and a drill program was initiated. From 1989 to 1991
      Bond carried out exploration programs including 17,638 meters of diamond
      drilling, surface mapping and sampling and airborne EM and magnetic surveys.
      Lac
      Minerals acquired Bond in early 1991. Surface drilling on the Marc, AV, JW,
      AV
      Tails and 141 zones continued in 1991, 1992, 1993 and 1994, totaling 48,000
      meters. Underground exploration of the Marc zone, including a total of 38,600
      meters of diamond drilling, was conducted in 1993 and 1994 via the use of a
      1,000-metre production-sized decline.





In
      September 1994, Barrick acquired Lac and the Red Mountain project assets were
      transferred to Barrick. Barrick sold the project to Royal Oak in August 1995.
      Royal Oak extended the underground workings, undertook a drill program seeking
      extensions to the known deposits, and worked on plans for the possible
      development of the project. In 1996, lacking funds for exploration, Royal Oak
      virtually ceased all activity at Red Mountain. By early 1999 Royal Oak was
      in
      serious financial difficulty and an Interim Receiver was appointed to dispose
      of
      Royal Oak’s assets, including Red Mountain.





NAMC’s
      purchase of the Red Mountain project was completed on February 10, 2000. During
      2000, NAMC completed a comprehensive review of the Red Mountain geological
      and
      environmental data. NAMC also carried out geological work including the
      re-logging of a substantial quantity of drill core in order to produce an
      improved resource estimation model. An access road route was designed from
      the
      end of the existing road to the site. During 2001 new management at WRM elected
      to dispose of certain assets, including Red Mountain. Effective December 31,
      2001, Seabridge agreed to acquire the Red Mountain project.





In
      total,
      466 surface and underground diamond drill holes totaling 134,807.24 meters
      have
      tested a variety of targets on the Red Mountain property. Four hundred and
      six
      holes, totaling 105,129.20 meters, were drilled by Bond and Lac between 1989
      and
      1994. The remaining 60 holes, totaling 29,678.04 meters, were drilled by Royal
      Oak in 1996. No drilling was conducted by NAMC. The majority of drilling has
      tested the Marc, AV, JW and AV-JW Tails mineralized zones. A total of 368 drill
      holes from the Bond and Lac programs, including 207 surface drill holes and
      161
      underground drill holes, have tested this area. In addition, 2,000 meters of
      underground workings have been excavated, including a 1,000-meter
      production-sized decline.




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**Mineral
      Resources**





Red
      Mountain is a structurally-controlled gold deposit. In May 2001, WRM completed
      a
      comprehensive review and validation of the project’s geological and
      environmental data. This review included re-logging all drill core and the
      construction of a new kriged resource block model. Prior to the closing of
      the
      acquisition of the property, Seabridge commissioned D.L. Craig, Professional
      Geologist, to perform an independent technical review of the new resource model.





The
      new
      mineral resource estimate for Red Mountain incorporates data from 206 drill
      holes that were relogged in 2000 by NAMC. Gemcom software was used to create
      geological and mineralization outlines in plan and section for a 3D block model.
      Gold and silver grades were interpolated using ordinary kriging with anisotropic
      search ellipses designed to fit the geology.





**Cautionary
      Note to U.S. Investors concerning estimates of Measured and Indicated
      Resources**


This
      section uses the terms “measured” and “indicated resources”. We advise U.S.
      investors that while those terms are recognized and required by Canadian
      regulations, the U.S. Securities and Exchange Commission does not recognize
      them. **U.S. Investors are cautioned not to assume that any part or all of
      mineral deposits in these categories will ever be converted into
      reserves.**





In
      January 2003, the Company engaged SRK Consulting to complete an engineering
      study of the Red Mountain project. In their study, which was completed in August
      2003, SRK determined that a 6.0 gram per tonne cut-off grade was appropriate
      for
      determining gold resources which may be available for economic
      extraction.





Red
      Mountain Measured and Indicated Resources at 6.0-gram-per-tonne
      cutoff:





Measured
            
            IndicatedTonnes
              (000s)
            Grade
              (g/t)
            
            Tonnes
              (000s)
            Grade
              (g/t)866
            9.39
            
            193
            8.43


**Cautionary
      Note to U.S. Investors concerning estimates of Inferred
      Resources**


This
      section uses the term “inferred resources”. We advise U.S. investors that while
      this term is recognized and required by Canadian regulations, the U.S.
      Securities and Exchange Commission does not recognize it. “Inferred resources”
have a great amount of uncertainty as to their existence, and great uncertainty
      as to their economic and legal feasibility. It cannot be assumed that all or
      any
      part of an Inferred Mineral Resource will ever be upgraded to a higher category.
      Under Canadian rules




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estimates
      of Inferred Mineral Resources may not form the basis of feasibility or other
      economic studies. **U.S. investors are cautioned not to assume that part
      or all of an inferred resource exists, or is economically or legally
      mineable.**





Red
      Mountain Inferred Resource at 6.0 gram-per-tonne cutoff:





InferredTonnes
              (000s)
            Grade
              (g/t)158
            8.62





None
      of
      the resource can be classified as a Mineral Reserve. Additional exploration
      work
      will be required in order to upgrade the resources into reserve categories,
      and
      a full feasibility study will be required in order to determine if any of the
      mineral resource are economic and can be profitably mined.





**Environmental/Regulatory
      Information**





The
      Red
      Mountain project is covered by the British Columbia Ministry of Energy and
      Mines, Mineral Exploration Permit MX-1-422. This permit was first issued on
      June
      24, 1993 and was most recently transferred to the Company in April
      2002.





Exploration
      work to date includes surface geological examinations, surface diamond drilling,
      and creation of underground workings. Underground workings totaled 1000 meters
      of declines and 1000 meters of crosscuts and drifts. There are 90,000 tonnes
      of
      waste from exploration work stored in two locations on surface. Of this
      material, 5,000 tonnes is situated adjacent to the portal and 85,000 tonnes
      is
      stored 250 meters south of the portal. The underground workings remain intact
      to
      the water level at the first main crosscut and the portal is sealed with a
      wooden door to prevent access. The piles were started in 1993 and the last
      waste
      rock was added in the summer of 1996. There is a small fleet of mobile equipment
      at the site, mostly parked on top of the waste dump. There are also several
      sea
      containers near the portal, a wooden exploration camp in the bowl below the
      portal and a steel Quonset hut hanger near the camp. The equipment on site
      is
      considered adequate to carry out the proposed reclamation plan.





A
      reclamation plan was filed in June 1996 by Royal Oak Mines along with $1.5
      million in cash reclamation security held by the Province of BC under a safe
      keeping agreement. Based on subsequent monitoring and site work performed by
      NAMC, with technical assistance provided by SRK Consulting of Vancouver B.C.,
      in
      January 2002, NAMC submitted a revised reclamation plan to the B.C. Ministry
      of
      Energy and Mines. The major difference between the original Royal Oak plan
      and
      the revised NAMC plan is the proposed treatment of the 90,000 tonnes of waste
      material. The revised plan, endorsed by SRK, involves in-place recountouring
      of
      the waste material rather than placing the




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material
      underground. In April 2002, the B.C. Ministry of Energy and Mines reduced the
      cash reclamation bond to $1.0 million.





**Current
      and Planned Work**





In
      August
      2003, SRK Consulting completed an engineering study of the Red Mountain project.
      SRK reviewed previous reviewed previous work performed on the project and
      evaluated the development alternatives relating to various aspects of the
      project. In their study, SRK determined that the best development alternatives
      for Red Mountain are:





·
            Road
                access to the site. A road was designed by NAMC in 2001 to access
                the
                project site.


·
            A
                seasonal operation from May to October was selected in favor of year-round
                operations on the basis of safety and
                reliability.


·
            An
                on-site mill using a grinding and cyanidation leaching (CIP) circuit
                was
                selected. The alternative of using flotation to produce a sulphide
                concentrate for offshore marketing was discarded on the basis of
                poor
                economics caused by lower overall gold recovery and smelting
                costs.


·
            A
                conventional type of mill was selected instead of a portable type
                due to
                the tonnage required (1000tpd) and the very fine grind
                needed.


·
            The
                full use of backfill was selected to optimize the mining recovery
                of the
                resources. Minimizing backfill was considered to reduce costs, but
                the
                possible savings are not enough to justify the lower mining recovery
                that
                results.





SRK
      identified that the main risks associated with the project are related
      to:


·
            The
                construction and operation of the mine access road, which must traverse
                rugged mountainous terrain.


·
            A
                lack of continuity in the workforce due to the seasonal
                operation.


·
            Project
                economics requiring a higher gold price than currently
                exists.


·
            The
                tailings facility, which must retain a water cover on the tailings
                in
                perpetuity.





SRK
      recommends that the following follow up work could prove beneficial to the
      project:


·
            Exploration
                to increase the potentially economic
                mineralization.


·
            A
                revised design for the cirque tailings facility to reduce its capital
                cost
                and its long-term costs after
                closure.





None
      of
      the resource at Red Mountain can be classified as a Mineral Reserve. Additional
      exploration work will be required in order to upgrade the resources into reserve
      categories, and a full feasibility study will be required in order to determine
      if any of the mineral resource are economic and can be profitably mined.





The
      Company estimates annual holding costs of the property to currently be
      approximately $215,000 broken down as follows:





a)
            $130,000
                to the British Columbia Ministry of Energy and
                Mines




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b)
            $50,000
                to Wotan Resources Corporation as an annual advance
                royalty


c)
            Approximately
                $15,000 in property taxes, utilities and rentals on warehouse space
                paid
                to the District of Stewart, British
                Columbia


d)
            Approximately
                $20,000 for ongoing environmental monitoring at the project
                site.





**Quartz
      Mountain Project**





The
      Quartz Mountain Project is a 542 hectare (1,340 acres) gold project located
      in
      southern Oregon. Seabridge currently has a 100% interest in the project, subject
      to NSR’s totaling 1.5%, and an option agreement with Quincy Energy Corp.
      (formerly Quincy Resources Inc.), who can earn an initial 50% interest in the
      property by expending $1,500,000 on exploration by October 15, 2008 and issuing
      250,000 common shares of Quincy to Seabridge. The agreement with Quincy excludes
      the mineral resource already outlined on the property as discussed below.
**The Property is without known mineral reserves and is at the exploration
      stage; The Company’s current efforts are exploratory in
      nature.**





**Location
      and Access**




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The
      Quartz Mountain property is located in the Fremont National Forest, Bly Ranger
      District, of South-central Oregon about 30 miles west-northwest of the town
      of
      Lakeview along Oregon State Highway 140. Two claim groups make up the property
      holdings and consist of 67 mining claims that total 542 ha (1,340 acres).




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Access
      to
      the property from Oregon State Highway 140 is via several paved and gravel
      covered forest access roads. These forest service access roads are used on
      a
      seasonal basis by local logging companies that operate in the area. Connected
      to
      the network of forest service roads are a variety of trails that were
      constructed to facilitate logging and previous mineral exploration. Access
      to
      the resource areas can be gained on existing secondary trails or by
      rehabilitating old trails.





**How
      Acquired**





In
      December 2001, the Company entered into an Asset Purchase & Sale and Royalty
      Agreement with Quartz Mountain Gold Corp. whereby Seabridge agreed to acquire
      100% of the Quartz Mountain Gold Project in consideration of the following
      payments to Quartz Mountain Gold Corp. US$100,000 in cash; 300,000 common shares
      of Seabridge; 200,000 common share purchase warrants, exercisable for two years
      at a price of $0.90 per share (exercised in 2003); and a 1% NSR in the project.
      Closing of the acquisition was completed in January 2002. Additionally, a 0.50%
      NSR will be payable to an unrelated third-party as a finder’s fee.





On
      October 15, 2003, the Company signed an option agreement with Quincy Resources
      (now known as Quincy Energy Corp.) where Quincy can earn an initial 50% interest
      in the project (not including the “Excluded Ounces” as defined below”) by
      spending $1,500,000 on exploration at the project on or before October 15,
      2008
      under the following schedule.





Date
            Required
                Expenditure AmountBy
                October 15, 2004
            $100,000
              (completed)By
                October 15, 2005
            $250,000
              (completed)By
                October 15, 2006
            $500,000By
                October 15, 2008
            $1,500,000





Quincy
      must also issue 250,000 of its common shares to Seabridge under the following
      schedule:





Date
            Required
                Share IssuanceUpon
                Execution of the Agreement
            50,000
                shares (issued)Within
                30 days satisfying the expenditure obligations above
            200,000
                shares





Once
      the
      expenditure amounts and the share issuances have been satisfied, Quincy will
      be
      deemed to have earned a 50% interest in the property and will form a
      Joint-Venture with Seabridge. Quincy can earn an additional 12.5% interest
      (for
      62.5% total) in the project by funding 100% of a feasibility study on the
      project within 3 years and issuing an additional 250,000 common shares to
      Seabridge upon completion of the study. If




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Quincy
      decides against preparing a feasibility study, or fails to deliver a study
      within 3 years, Seabridge has a one-time option to purchase Quincy’s interest in
      the project for US$750,000. Quincy will be responsible for all land holding
      fees
      and costs associated with the property as long as the option remains in
      effect.





The
      option agreement with Quincy excludes the potential mineral resource already
      outlined on the property under a Winters, Dorsey & Company LLC study. That
      area of the property, known as the “Excluded Ounces”, remains 100% held by
      Seabridge, subject to the NSR. If Quincy delivers to Seabridge a Feasibility
      Study that incorporates within the mine plan the Excluded Ounces, those ounces
      shall be transferred to the Joint Venture at a price to be paid by Quincy to
      Seabridge equal to Quincy’s working interest times the estimated gross operating
      margin of those ounces, less a 25% discount. Payment for the Excluded Ounces
      will be due on a quarterly basis as they are produced.





Under
      the
      option agreement, the company’s also agree that should either party acquire
      and/or stake claims, exploration permits, mining leases or any other form of
      mineral right or interest within an area of interest within 2 miles of the
      outer
      boundaries of the property, that additional property will automatically become
      part of the property subject to the agreement.





**Regional
      and Property Geology**





The
      Quartz Mountain gold and mercury district is located in a Mid-Tertiary volcanic
      highland within the northern transitional zone of the Great Basin. One of the
      primary structural features of the district is a wide (3 miles) northwest
      trending structural zone that interrupts the thick sequence of basalt flows.
      Hydrothermal alteration in the district is characterized by acid leaching of
      the
      host rocks and subsequent precipitation of quartz in the gold zones. Ryholitic
      domes make up the central feature of the volcanic stratigraphy of the area
      and
      are characterized by glassy tops.





The
      Quartz Mountain project is a volcanic-hosted, hot-spring gold deposit.
      Disseminated, micron-size, native gold mineralization at Quartz Mountain
      accompanies pervasive silica flooding and quartz veining. Mineralized zones
      measure up to 300 feet in thickness and 3000 feet in diameter on Crone Hill
      and
      up to 100 feet in thickness and 1000 feet in diameter on Quartz Butte. There
      are
      two distinct areas of gold mineralization present at Quartz Mountain, Crone
      Hill
      and Quartz Butte.





**Previous
      Exploration**





Quartz
      Mountain was believed to have been initially prospected for gold by migrant
      Chinese in the 1890s. Rare prospect pits that contain ponderosa pine trees
      over
      four feet in diameter are indirect evidence of this initial early stage of
      exploration activity.





The
      earliest recorded work was performed by the Sun Oil Company, between 1936 and
      1940. Sun Oil was prospecting for mercury with shallow pits and trenches. In
      1949, small amounts of gold were reportedly recovered from two shafts on Crone
      Hill and Quartz




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Butte.
      The shafts were sunk by employees of the Ewauna Camp Lumber Company and have
      since caved in. The property saw renewed interest in the late 1950’s due to a
      nation-wide mercury "boom". Local prospectors staked dozens of claims in what
      became the 60-square mile Quartz Mountain mercury district. Most of the cinnabar
      claims were allowed to become delinquent during the 1960s in a general collapse
      of the mercury mining industry.





In
      1980,
      the claims were staked by a prospector and acquired by Exploration Ventures
      Company (“EXVENCO”) of Spokane, Washington in 1982. The Anaconda Company entered
      a joint venture partnership with EXVENCO in December 1982, and subsequently
      enlarged the claim block to include the entire Quartz Mountain district.
      Anaconda was the operating partner and initiated the first systematic
      exploration program for gold in the district. In the spring of 1985, Anaconda
      was disbanded by its parent company, Atlantic Richfield Corporation, and Quartz
      Mountain, along with all of their other mineral properties, was placed up for
      sale.





Wavecrest
      Resources Ltd secured Anaconda's interest in the property through a purchase
      agreement in the autumn of 1985. Wavecrest quickly consolidated their holdings
      on the entire claim block by purchasing EXVENCO's interest. The remaining small,
      inlaying claim blocks dating from the late 1950’s were systematically acquired
      and for the first time in its history, the Quartz Mountain district was
      consolidated under a single owner in June of 1986. Wavecrest Resources Ltd.
      and
      Galactic Resources Ltd. created Quartz Mountain Gold Corporation in June of
      1987
      to jointly advance the project. In 1987, 460 drill holes were completed on
      Crone
      Hill, Quartz Butte and Angel’s Camp totaling 52,284 meters (171,537 feet) of
      drilling. In 1988, 100 drill holes (including 47 large diameter metallurgical
      drill core holes) were completed on Crone Hill, Quartz Butte, Angel East and
      Drews Dome for a total of 10,600 meters (34,778 feet). The Crone Hill and Quartz
      Butte deposits were drilled off on at least 30.5 meters (100-foot) centers
      during these programs. Between mid-September and late November 1988, 19 deep
      drill holes totaling 4,473 meters (14,675 feet) were completed on Quartz Butte
      to explore for high-grade feeder veins within the throat of the Quartz Butte
      dome. A total of 34 deep drill holes now define this feeder zone
      system.





In
      July
      1989, Pegasus Gold became operator of the Quartz Mountain Gold Project. In
      December 1994, Pegasus terminated the joint venture agreement with Quartz
      Mountain. Some of the key terms of this termination agreement required Pegasus
      to return its interest in the property, forgive outstanding loans to Quartz
      Mountain and performed all required reclamation work. Pegasus completed these
      obligations and Quartz Mountain Gold assumed undivided ownership of the property
      without debt or reclamation obligations. In August 1995, Quartz Mountain Gold
      Corporation concluded a letter agreement with Newmont Exploration Ltd. on the
      Quartz Mountain property. This agreement allowed Newmont to earn an 80%
      operating interest in the property for certain cash payments and work
      commitments. Newmont drilled 10 holes on the project, which were focused on
      expanding the near-surface, low-grade gold resources that had been previously
      identified. The project did not satisfy Newmont’s investment criteria and was




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returned
      to Quartz Mountain Gold in 1996. Since 1996, little exploration work has been
      performed on the project.





**Environmental/Regulatory
      Information**





The
      United States Forest Service (USFS) would be the lead regulatory agency on
      the
      federal level that is responsible for review and approval of mining activities
      at Quartz Mountain. The Quartz Mountain Project is characterized as an
      exploration stage project that has undergone considerable exploration and a
      Feasibility Study level evaluation of an open pit(s) mine with heap leach
      processing in the mid-to-late 1980's. Environmental baselines and monitoring
      at
      Quartz Mountain were initiated by previous owners in the late 1980's. These
      activities were directed by SRK Consulting’s Reno Office. These reports are
      valuable in assessing impacts and making recommendations for future work. The
      reports also provide valuable information that may be used by Seabridge in
      limiting liability as well as supporting future efforts should Seabridge decide
      to proceed with preparation of a particular plan at the Quartz Mountain
      Project.





To
      further study the permitting issues at Quartz Mountain, Seabridge retained
      Gochnour & Associates of Parker, Colorado (“Gochnour”) to undertake an
      environmental review and regulatory permitting due diligence on Quartz Mountain.
      The report of Gochnour is entitled “Quartz Mountain Project;
      Permitting/Environmental Report” (the “QMP P/E Report”) and dated November 28,
      2001.





The
      Gochnour study examined various potential development scenarios including an
      open pit and/or underground mining operations. Processing Alternatives include
      on-site milling and/or heap leach technology utilizing cyanide, and off-site
      processing (toll milling). Waste disposal alternatives include overburden
      stockpiles adjacent to the orebody (under an open pit scenario). With an
      underground or combination open-pit/underground mining scenario, waste could
      be
      used as backfill and/or stockpiled on the surface, adjacent to mining
      operations. Each Alternative would require the preparation of a different
      reclamation strategy. Gochnour concluded that each of the scenarios is
      permittable under current federal and state law. To complete the permitting
      process, Gochnour estimates that the open-pit scenario would take 3-5 years
      to
      permit once a Plan of Operations (“POO”) had been submitted. Gochnour estimated
      the permitting time frame for the underground scenarios at 2-3 years after
      the
      POO was submitted.





**Exploration
      Potential**





The
      Quartz Mountain mineral system can be classified as a low-sulfidation epithermal
      deposit based on the characteristic mineralogical suite of adularia, cinnabar
      and stibnite. The characteristic geometry and bonanza vein occurrences
      associated with low-sulfidation systems have not been recognized at Quartz
      Mountain because resource delineation has been focused on the shallow parts
      of
      the system that favor the bulk-mineable or disseminated gold concentrations.
      The
      low-sulfidation epithermal model seems to best explain the distribution of
      gold,
      characteristic boiling textures in the veins and mineralogy at Quartz Mountain.
      This model implies that there is a potential for




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discovering
      high-grade bonanza veins that provided fluid pathways for the large volumes
      of
      gold-bearing fluids that created the system.





**Current
      and Planned Work**





During
      2004, Quincy completed approximately 4,000 meters of core drilling at the
      property designed to test for higher grade feeder zones. Quincy plans to conduct
      additional drilling in 2005. Annual holding costs at the project are
      approximately US$10,000 primarily paid to the U.S. Bureau of Land
      Management.





**Hog
      Ranch Project**





The
      Hog
      Ranch Project is a gold project of approximately 5,000 acres located in northern
      Nevada. Seabridge currently has a 100% interest in the project, subject to
      a 3%
      to 5% NSR which varies depending upon the commodity price of gold. In August
      2003, the Company granted Romarco Minerals an option to earn an initial 60%
      interest in the property. **The Property is without known mineral reserves
      and is at the exploration stage; The Company’s current efforts are exploratory
      in nature.**





**Location
      and Access**





The
      Hog
      Ranch project is located in northern Washoe County, Nevada, approximately 230
      kilometers north of Reno. Access to the property is 2 miles off of Nevada state
      highway 477, midway between Gerlach, Nevada and Susanville,
      California.





**How
      Acquired**





In
      November 2000, the Company acquired a 100% leasehold interest in the Hog Ranch
      gold project in northern Nevada. Under the agreement with Platoro West Inc.,
      Seabridge paid Platoro US$75,000 cash and issued 500,000 common shares. Platoro
      will be paid a further US$250,000 upon the earlier of:





a)
            confirmation
                by an independent third party of a measured and indicated gold reserve
                of
                more than 1.0 million ounces, or


b)
            completion
                of a positive bankable feasibility study which demonstrates a mine
                capable
                of producing at least 100,000 ounces of gold per
                annum.





Commencing
      on the 4th anniversary of the agreement, Platoro will receive an
      annual advance royalty payment of US$10,000, escalating by US$2,500 per annum
      to
      a maximum of US$20,000 per annum. Additionally, Seabridge is required to
      maintain the property claim block in good standing at an estimated annual cost
      of US$35,000. Should production commence at Hog Ranch, Platoro West will be
      paid
      a sliding-scale net smelter royalty ranging from 3% when gold is less than
      $300
      per ounce, to 5% when gold is greater than $500 per ounce. In addition, Platoro
      will be paid a royalty of 3.5% on gross proceeds from any other metals produced.
      Seabridge retains the right to buy back 40% of the royalty at any time for
      US$2
      million.




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In
      August
      2003, the Company granted Romarco Minerals an option to earn an initial 60%
      interest in the property by spending US$2.5 million on exploration and issuing
      to Seabridge 1.5 million Romarco common shares by December 31, 2007. In February
      2005 Romarco terminated its rights under the agreement and the property reverted
      back to the Company.





**Regional
      and Property Geology**





Hog
      Ranch
      is situated on the southeast edge of the Cottonwood Creek volcanic center
      (“CVCC”), which is located at the southern end of the Northwest Nevada volcanic
      field. The CVCC is thought to be a failed or downsag caldera with no recognized
      large volume ash flow eruption or catastrophic caldera collapse event. Hog
      Ranch
      is an epithermal low-sulfidation gold deposit hosted by rhyolite volcanic and
      volcanoclastic rocks. Ore zones exploited by Ferret and Western Mining were
      principally disseminated occurrences hosted by poorly welded tuff and lacustine
      rocks. Veins are better developed in the component densely welded tuff. Volcanic
      centers and the historical open pits are aligned in a northeast trend coincident
      with the Black Rock Structural Boundary. The identified high-grade vein system
      is contained in the northwest trending faults.





**Previous
      Exploration**





Gold
      was
      first discovered at Hog Ranch in 1980 by Noranda Exploration, Inc. Noranda
      geologists were led to the area by an airborne radiometric survey of
      northwestern Nevada during a 1979 uranium reconnaissance program. No significant
      uranium occurrences were found but anomalous gold concentrations were discovered
      in the Bell Springs area. By 1981, Noranda had extended their claim holdings
      across the northern part of the Hog Ranch area and had drilled out a small
      gold
      resource at Bell Springs. Ferret Exploration Company, Inc. assumed operation
      of
      the Hog Ranch project in 1982 and proceeded to discover and drill out gold
      resources in the northern part of the Hog Ranch area and at Bell
      Springs.





Exploration
      activities by various owners through 1986 focused exclusively on open-pit
      deposits amenable to heap leach processing. In 1986 Western Goldfields commenced
      mining activities at Hog Ranch. In 1988 Western Mining Corporation purchased
      Hog
      Ranch and continued mining until 1993. The mine has been shut down since 1993
      and final reclamation activities by Western Mining have been largely completed.





Exploration
      activities by previous owners at Hog Ranch focused exclusively on open pit
      resources amenable to heap leach processing. At least 2,640 holes were drilled
      at Hog Ranch, of which only 247 were drilled as angle holes and only 65 were
      drilled to a depth greater than 200 meters. A high percentage of these deeper
      inclined holes were in exploration areas away from the productive deposits.
      The
      vast majority of the drilling was vertical holes focused on the delineation
      of
      disseminated low-grade open-pit reserves. The Company believes that the
      unrealized opportunity at Hog Ranch rests with




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In
      2004
      Romarco completed two phases of drilling at Hog Ranch. The initial phase of
      drilling consisted of a total of 725 meters in three rotary-reverse circulation
      drill holes that were designed to begin testing bonanza gold vein targets below
      and around the previously mined Geib Pit. One of the holes intersected 21.3
      meters averaging 5.23 grams of gold per tonne. Included in this intercept were
      two 1.5-meter high-grade intercepts which assayed 28.7 grams of gold per tonne
      and 17.2 grams of gold per tonne respectively. Rom  
 In
        early
        2001, Seabridge initiated an eight-hole diamond drill program to test for
        the
        potential of a high-grade underground gold deposit similar to the nearby
        Midas
        and Sleeper mines. The program successfully confirmed all the necessary
        conditions for such a deposit. High-grade gold intercepts from two different
        structures intersected in the drilling may represent the discovery of the
        upper
        levels of such a deposit. Results from this drilling program yielded assay
        results of up to 19.9 grams of gold per tonne within a fracture and vein
        zone.
        Observations of the core from the recent program have enabled Company geologists
        to reinterpret previous data and conclude that: (1) alteration has the scale
        (seven by eight kilometers) and intensity similar to other major deposits
        in
        northern Nevada; (2) the gold has been concentrated in specific, identifiable
        structures which have significant strike and down-dip potential; and (3)
        previous open pit mining was in the very top of the mineralized system, leaving
        the higher-grade potential intact and below the level of previous workings.
        A
        further program has been recommended to test for the higher grade ‘boiling’ zone
        which evidence suggests should be below the intercepts from the recent
        program.
  **Current
        and Planned Work**
 arco’s
      second phase of drilling consisted of approximately 1,400 meters in six diamond
      drill core holes. The purpose of the program was to begin testing bonanza gold
      vein targets below and around the previously mined Geib and Krista Pits and
      to
      try to expand on the significant mineralization encountered in Romarco initial
      phase o drilling. The highlight of the second phase program was 1.5-meter
      intercept that assayed 15.3 grams of gold per tonne. In February 2005 Romarco
      terminated its rights under the agreement and the property reverted back to
      the
      Company.


There
      is
      no immediate exploration planned at Hog Ranch for the current year. Current
      holding costs at Hog Ranch are estimated to be US$47,000 per year including
      $34,500 in payments to the US Bureau of Land Management and Washoe County,
      Nevada, and an annual advanced royalty payment of US$12,500 to Platoro West
      Inc.
      The annual advanced royalty payment to Platoro increases by US$2,500 per year
      to
      a maximum of US$20,000 per year.




**Castle/Black
      Rock Project**





The
      Castle/Black Rock Project is a 2,500 acres gold project located in west-central
      Nevada. Seabridge currently has a 100% interest in the project, subject to
      a 3%
      to 5%




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NSR
      which
      varies depending upon the commodity price of gold. **The Property is
      without known mineral reserves and is at the exploration stage; The Company’s
      current efforts are exploratory in nature.**





**Location
      and Access**





The
      Castle/Black Rock project is located in Esmeralda County, Nevada, off the flank
      of the Monte Cristo Mountain Range in the southwest part of the Big Smokey
      Valley. The property consists of 131 contiguous unpatented mining claims located
      on public lands administered by the U.S. Bureau of Land Management. The project
      straddles U.S. highway 95/6, approximately 20 miles west of Tonopah,
      Nevada.




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**How
      Acquired**





In
      October 2000, the Company acquired a 100% leasehold interest in the Castle/Black
      Rock gold from Platoro West Inc. The purchase agreement included the Company
      issuing 5,000 common shares to Platoro and for annual advance royalty payments
      of US$7,500 in the first year, US$8,500 in year 2, US$17,500 in year 3, and
      thereafter US$25,000 annually. Additionally, Seabridge is required to maintain
      the 2,500-acre claim block in




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good
      standing at an estimated annual cost of US$15,000. Should production commence
      at
      Castle/Black Rock, Platoro West will be paid a net smelter royalty ranging
      from
      3% when gold is less than $320 per ounce, to 5% when gold is greater than $500
      per ounce. In addition, Platoro will be paid a royalty of 3.5% on gross proceeds
      from any other metals produced. Seabridge retains the right to buy back half
      of
      the royalty at any time for US$1.8 million.





**Regional
      and Property Geology**





The
      property occurs within the Walker Lane gold belt. Quaternary gravel and alluvial
      fan deposits cover most of the Castle/Black Rock property. Hydrothermal
      alteration in the volcanic rock is focused on structures and zoned vertically
      and laterally. Vertical zonation of the alteration sequence has created an
      intense argillic cap above the gold bearing structures, from 3 to 30 meters
      thick.





The
      known
      gold mineralization on the property is concentrated in 3 zones; Castle, Black
      Rock and Berg-Boss. In each zone, gold is concentrated in structures hosted
      by
      sedimentary rocks, andesite and rhyolite. Gold is also distributed away from
      the
      structures in andesite and rhyolite.





**Previous
      Exploration**





Outcropping
      gold mineralization was discovered by a Tonopah prospector in the 1960s in
      the
      hills just northwest of Black Rock and Highway US 95/6. The mineralization
      was
      explored at that time by a 50-foot deep shaft (Boss Mine) and some dozer
      trenches plus 2 diamond and 8 rotary drill holes.





Houston
      Oil and Minerals Corporation (HOM) began systematic surface exploration of
      the
      outcropping mineralization and surrounding area in 1979 and outlined a small
      unclassified resource of about 200,000 tons at an average gold grade of 0.07
      ounces per ton. Disappointed with the small size and their inability to get
      the
      ore to leach, HOM relinquished the property at the end of 1979. The property
      was
      then acquired in 1981 by Ebco Enterprises and optioned in that year by Falcon
      Exploration, who proceeded to delineate a larger reported ore zone at the Boss
      and elected to construct a small open-pit, heap leach mine. Homestake Mining
      Company optioned Falcon’s peripheral claims in 1987 and discovered gold
      mineralization south of Black Rock during their drill program. Homestake
      relinquished the property that same year.





Falcon
      poured their first bar of gold in January 1988 and began an exploration program
      on the peripheral claims in the spring of that year. Westley Explorations and
      Mintec Resources optioned the Boss claims from Falcon in August of 1988 and
      undertook a surface exploration and drilling program. The area northeast of
      Black Rock, now known as the Castle zone, was never drilled by Mintec. Mintec
      eventually relinquished their claims in the early 1990s, including the
      northeastern corner of the block, which covered the current Castle
      deposit.




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Kennecott
      Exploration staked a large block of claims northeast of the Boss pit in 1992
      as
      part of a large regional exploration program in the Walker Lane District. This
      original claim block did not include what eventually became the Castle
      discovery. Kennecott executed a surface exploration program with initial
      drilling in 1993. Kennecott eventually drilled a total of 65 Reverse Circulation
      (“RC”) holes totaling 26,435 feet, which delineated a broad mineralized zone
      2400 feet wide and at least 4200 feet long. The last RC hole was drilled in
      August 1995. Within this broad zone, Kennecott identified at least one ore
      zone
      that was never systematically drilled out and other mineralized drill holes
      were
      left without follow-up.





In
      October 1996, Fischer-Watt Gold Company (FWG) purchased the Castle property,
      consisting of 20 “CP” claims, from Kennecott. They staked an additional 32 lode
      claims around the periphery of the Kennecott block. The surrounding ground
      to
      the west and south, including the Berg and Black Rock zones, was staked by
      Platoro Resources, LLC earlier in that same year. In January 1998, the property
      was optioned from FWG by Zephyr Resources. Subsequent to Zephyr Resources,
      Cordex Exploration Co (a 100% subsidiary of Ray rock Resources Inc.) leased
      the
      FWG properties and conducted additional exploration activities, including RC
      drilling. In 1999 Glamis Gold acquired Ray rock and the Castle/Black Rock
      project was dropped. Later in 1999, Platoro acquired the FWG ground, thereby
      consolidating the property positions under a single owner.





**Current
      and Planned Work**





There
      is
      no immediate exploration planned at Castle/Black Rock for the current year.
      However, management intends to retain the project within its property portfolio.
      The Company estimates annual holding costs of the property to be a total of
      US$40,000, with US$25,000 paid to Platoro West as an annual advance royalty
      and
      US$15,000 paid to the US Bureau of Land Management and to Esmeralda County,
      Nevada.





**Pacific
      Intermountain Gold Corporation Projects**





The
      Company currently owns a 100% interest in Pacific Intermountain Gold Corporation
      (“PIGCO”), a private company focused on the acquisition and exploration of
      early-stage gold and silver properties in Nevada. The Company’s ownership
      interest in PIGCO is subject to a 10% net profits interest held by a previous
      minority shareholder in PIGCO.





**All
      of PIGCO’s Properties are without known mineral reserves and are at the
      exploration stage; PIGCO’s current efforts are exploratory in
      nature.**





To
      date,
      PIGCO has staked approximately 1,800 claims, or about 36,000 acres, of mineral
      exploration land in Nevada. This acreage covers more than 20 identified gold
      exploration targets, with most of the property located in Nye County. All lands
      in the area are managed by the US Bureau of Land Management, and annual holding
      costs of the property are approximately US$250,000 plus an additional US$99,500
      in underlying lease payments.




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Seabridge
      intends to seek joint-venture partners to carry out exploration on the majority
      of PIGCO’s staked lands. However, Seabridge intends to maintain certain
      properties for its own exploration portfolio and conduct work on these
      properties in the future. Seabridge plans to drill test the Four-Mile Basin
      project and Golden Arrow project during 2006.





**Item
      4A.**   **Unresolved Staff
      Comments**




Not
      applicable





**Item
      5.****Operating and Financial
      Review and Prospects**




**Overview**





The
      Company's financial statements are stated in Canadian Dollars (C$) and are
      prepared in accordance with Canadian Generally Accepted Accounting Principles
      (GAAP), the application of which, in the case of the Company, conforms in all
      material respects for the periods presented with United States GAAP except
      as
      noted in Footnote #11 to its audited annual financial statements for the year
      ended December 31, 2005. The value of the U.S. Dollar in relationship to the
      Canadian Dollar was $1.17 as of December 31, 2005.





The
      Company has since inception financed its activities through the distribution
      of
      equity capital. The Company anticipates having to raise additional funds by
      equity issuance in the next several years, as all of the Company’s properties
      are at the exploration stage. The timing of such offerings is dependent upon
      the
      success of the Company’s exploration programs, the ability to attract
      joint-venture partners, as well as the general economic climate.





**Results
      of Operations**





**Year
      Ended December 31, 2005 Compared to Year Ended December 31,
      2004**





The
      Net
      Loss for the year ended December 31, 2005 totaled $1,157,000 or $0.04 per share
      compared to $1,226,000, or $0.04 per share for the year ended December 31,
      2004.
      The loss in 2005 was reduced by $821,000 (2004 - $575,000) in income tax
      recovery largely relating to the Company renouncing the Canadian Exploration
      Expenses to the investors of the flow-through financings completed in 2004
      and
      2003, respectively. Also in 2004, Pacific Intermountain Gold Inc. (“PIGCO”) a
      subsidiary of the Company sold shares which it had received on optioning out
      a
      mineral property resulting in a gain of $75,000 offset by $19,000 representing
      the minority interest in the gain. Corporate and general expenses were slightly
      lower in 2005 compared to 2004 as additional expenses in 2004 were incurred
      related to the listing of the Company’s shares on the American Stock Exchange
      and investor relations activity offset by slightly higher management fees in
      2005. In 2005 stock option compensation expense was $361,000 compared to
      $115,000 in 2004. Approximately $332,000 of the 2005 amount relates to the
      recognition of




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compensation
      expense for the two-tiered options to management. The expense is for reaching
      the $6 and $9 share price vesting requirements with the consequent vesting
      of
      500,000 of the 750,000 stock options outstanding.





**Year
      Ended December 31, 2004 Compared to Year Ended December 31,
      2003**





The
      Net
      Loss for the year ended December 31, 2004 totaled $1,226,000 or $0.04 per share
      compared to $1,338,000, or $0.05 per share for the year ended December 31,
      2003.
      The loss in 2004 was reduced by a $575,000 income tax recovery largely relating
      to the recognition of the Company’s tax assets after renouncing the Canadian
      Exploration Expenses to the investors of the flow-through financings completed
      in 2003. Also in 2004, PIGCO sold shares which it had received on optioning
      out
      a mineral property resulting in a gain of $75,000 offset by $19,000 representing
      the minority interest in the gain. Corporate and general expenses increased
      by
      $867,000 in 2004 over 2003. Approximately 39% of this increase was due to
      increased investor relations activities including listing on the American Stock
      Exchange and investor communications. Approximately 27% of the increase in
      corporate and general expenses was due to higher salaries and benefits for
      senior personnel and the hiring of a Chief Financial Officer. A further 15%
      of
      the increase reflects a full year of directors’ fees which the Company commenced
      paying in mid 2003 as well as the introduction of a comprehensive directors
      and
      officers liability insurance policy. About 12% of the increase was due to the
      recognition of the accretion for costs of reclamation liabilities. Finally,
      about 6% of the increase was due to higher costs of regulatory compliance,
      principally accounting and legal fees required by changes in regulations. In
      2003, the Company wrote off the Tobin Basin exploration project in Nevada
      amounting to $342,000 due to unsuccessful exploration results.





**Liquidity
      and Capital Resources**





The
      ability of the Company to successfully acquire additional advanced-stage gold
      projects or to advance the projects already acquired is conditional on its
      ability to secure financing when required. The Company proposes to meet any
      additional cash requirements through equity financings. In light of the
      continually changing financial markets, there is no assurance that new funding
      will be available at the times required or desired by the Company.





**Year
      Ended December 31, 2005**





The
      Company’s working capital position, at December 31, 2005, was $10,603,000 an
      increase of $6,383,000 compared to $4,220,000 at the prior year-end. Included
      in
      working capital, in 2005, was $4,028,000 (2004 - $1,170,000) in cash from
      flow-through share financings which will be used in 2006 for exploration at
      the
      Courageous Lake property. In 2005, the Company completed two flow-through
      financings, in February 500,000 common shares were issued at $4.25 each and
      in
      December 435,000 common shares were issued at $7.25 each. In addition, a private
      placement of 1 million shares at $5 each was completed with the Company’s
      largest shareholder. Also in 2005, the Company received cash of $863,000 from
      the exercise of warrants and $361,000 from the




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exercise
      of options. In 2005, total financings received were $11,299,000 compared to
      $8,241,000 in 2004.





Cash
      and
      short-term deposits at December 31, 2005 were $6,165,000, up from $2,788,000
      at
      December 31, 2004. In addition to the stated cash and short-term deposits,
      the
      Company had $4,028,000 in cash from flow-through share financings which will
      be
      used in 2006 for exploration at the Courageous Lake property. Operations
      activities used $1,220,000 in 2005 compared to $1,764,000 in the prior year
      due
      to increased corporate activities in 2004 including listing the Company on
      the
      American Stock Exchange. Cash expenditures on Mineral Interests including the
      capital assets were $3,843,000 comparable to the $6,714,000 cash expenditures
      in
      2004.





**US
      GAAP Reconciliation with Canadian GAAP**





Under
      U.S. GAAP, all expenditures relating to mineral interests prior to the
      completion of a definitive feasibility study, which establishes proven and
      probable reserves, must be expensed as incurred. Under Canadian GAAP, these
      amounts can be deferred. As such, under US GAAP, these amounts and related
      future tax liabilities are not recorded on the balance sheets.





The
      reader is advised to consult Seabridge’s audited annual financial statements for
      the period ending December 31, 2005, particularly Note #11, Reconciliation
      to
      United States Generally Accepted Accounting Principles, for the quantification
      of the differences.





**Variation
      in Operating Results**





The
      Company derives interest income on its bank deposits, which depend on the
      Company's ability to raise funds, the amount of the deposits and interest
      rates.





Management
      periodically, through the exploration process, reviews results both internally
      and externally through resource related professionals. Decisions to abandon,
      reduce or expand exploration efforts is based upon many factors including
      general and specific assessments of mineral deposits, the likelihood of
      increasing or decreasing those deposits, land costs, estimates of future mineral
      prices, potential extraction methods and costs, the likelihood of positive
      or
      negative changes to the environment, permitting, taxation, labor and capital
      costs. There cannot be a pre-determined hold period for any property as
      geological or economic circumstances render each property unique.





Under
      United States GAAP when flow-through shares are issued, the proceeds are
      allocated between the issue of shares and the sale of tax benefits. The
      allocation is made based on the difference between the quoted price of the
      existing shares and the amount that the investor pays for the shares. The
      shareholders’ equity is reduced and a liability is recognized for this
      difference which amounted to $202,000 for the flow-through shares issued in
      2004
      (2003 - $97,200). The liability is reversed when the tax benefits are renounced
      and a deferred tax liability recognized at that time. Income tax expense is
      the




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difference
      between the amount of the deferred tax liability and the liability recognized
      on
      issuance.





The
      Company's financial statements are stated in Canadian Dollars (CDN$) and are
      prepared in accordance with Canadian Generally Accepted Accounting Principles
      (GAAP), the application of which, in the case of the Company, conforms in all
      material respects for the periods presented with United States GAAP except
      as
      noted in Note 11 to the 2005 audited financial statements. The value of the
      Canadian Dollar in relationship to the US Dollar was $1.17 as of December 31,
      2005.





**Research
      and Development**





The
      Company conducts no Research and Development activities, nor is it dependent
      upon any patents or intellectual property licenses.





**Trend
      Information**





The
      Company knows of no trends, uncertainties, demands, commitments or events that
      are reasonably likely to have a material effect on the Company’s operations or
      financial condition.





**PART
      E: Off Balance Sheet Disclosure**





**Not
      Applicable**





**PART
      F: Contractual Obligations**





On-going
      contractual obligations of the Company are limited to property holding costs
      and
      reclamation liabilities. Although property holding costs are at the discretion
      of the Company, if payments are not made the Company will lose their rights
      to
      the project. Table No. 4 provides details of the Company’s future contractual
      obligations which are required to be satisfied in order to keep its projects
      in
      good standing.





Table
      No.
      4


Contractual
      Obligations ($000’s)


Payments
                due by periodTotal
            
            2006
            
            2007-9
            
            20010-11
            
            After
                2011Mineral
                interests
            
            
            9,270
            
            
            1,195
            
            
            3,969
            
            
            2,738
            
            
            1,
                372Reclamation
                liabilities
            
            
            1,407
            
            
            -
            
            
            -
            
            
            -
            
            
            1,40710,677
            
            
            1,195
            
            
            3,969
            
            
            2,738
            
            
            2,779





Amounts
      shown for mineral interests include option payments and mineral lease payments
      that are required to maintain the Company’s interest in the mineral
      projects.




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 Table
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**Item
      6.** **Directors, Senior Management and
      Employees**




Table
      No.
      5 lists as of March 15, 2006 the names of the Directors of the Company. The
      Directors have served in their respective capacities since their election and/or
      appointment and will serve until the next Annual General Meeting or until a
      successor is duly elected, unless the office is vacated in accordance with
      the
      Articles/By-Laws of the Company. All Directors are citizens of Canada, except
      William Calhoun, Eliseo Gonzalez-Urien and Louis Fox, all of whom are citizens
      of the United States. Rudi Fronk is a citizen of both Canada and the United
      States.





Table
      No.
      5


Directors





Name
            Age
            Date
                First Elected/AppointedJames
                Anthony
            58
            October
                1999Rudi
                Fronk
            47
            October
                1999Frederick
                Banfield (1,3)
            63
            October
                1999William
                Calhoun (1,2,3)
            73
            February
                2000Thomas
                Dawson (1,3)
            69
            January
                2006Henry
                Fenig (2,3)
            60
            November
                2001Louis
                Fox (2,3)
            63
            January
                2000Eliseo
                Gonzalez-Urien (3)
            65
            January
                2006








(1)
            Member
                of Audit Committee.


(2)
            Member
                of Compensation Committee


(3)
            Member
                of Corporate Governance Committee





Table
      No.
      6 lists, as of March 15, 2006 the names of the Executive Officers of the
      Company. The Executive Officers serve at the pleasure of the Board of Directors.
      Mr. Threlkeld is a citizen of the United States. Mr. Chisholm is a citizen
      of
      Canada. Mr. Fronk is a citizen of both Canada and the United
      States.





Table
      No.
      6


Executive
      Officers





Name
            Position
            Age
            Date
                of
              AppointmentRudi
                Fronk
            President
            47
            October
                1999William
                Threlkeld
            Senior
                Vice President
            51
            November
                2001Roderick
                Chisholm
            Secretary
                and CFO
            56
            August
                2004








James
      Anthony is a financier and corporate strategist specializing in growth
      companies. He served as a senior policy advisor to a number of cabinet ministers
      and a premier before establishing a corporate strategy consultancy. He advised
      a
      number of major




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corporations
      on their positioning within their political and financial environments and
      lectured at the Niagara Institute. Mr. Anthony has been President of J.S.
      Anthony & Company, a private investment company, since 1975 and was the past
      chairman of the board of Greenstone Resources Ltd. Mr. Anthony has been a
      Director of Seabridge since 1999 and as Chairman since 2001. Mr. Anthony spends
      approximately 50% of his time on Seabridge business.





Rudi
      Fronk has over 20 years experience in the gold industry, including serving
      as a
      director and senior officer of several publicly traded gold companies. He was
      appointed President, CEO and a Director of Seabridge in 1999 and has since
      that
      time continuously served in those roles. Mr. Fronk is the past President and
      Director of Greenstone Resources Ltd. from 1994 to 1999. Prior to 1994, he
      held
      positions with Columbia Resources (1992-1993), DRX Inc. (1989-1992), Behre
      Dolbear & Company (1986-1989), Riverside Associates (1984-1986),
      Phibro-Salomon (1982-1983), and Amax (1980). Mr. Fronk is a graduate of Columbia
      University from which he holds a Bachelor of Science in Mining Engineering
      and a
      Master of Science in Mineral Economics. Mr. Fronk spends 100% of his time on
      Seabridge business.





Frederick
      Banfield is the Founder of Mintec since 1970. Mintec is a consulting and
      software company that provides consulting services to the mineral industry.
      Mr.
      Banfield has also served an independent reserves auditor and mine planning
      advisor gold mining organizations with respect to projects in the United States,
      Canada, Africa, Australia and Latin America. Mr. Banfield holds an engineering
      degree from the Colorado School of Mines. Mr. Banfield spends less than 10%
      of
      his time on Seabridge business.





William
      Calhoun is President of W.M. Calhoun Inc., an independent consultant that
      provides consulting services to the minerals industry in the areas of mining
      operations, mine planning, mine design, ore reserves and environmental issues.
      From 1972 through 1981, Mr. Calhoun served as President and CEO of Day Mines,
      Inc., an American Stock Exchange Company with mining operations in the western
      United States that was acquired by Hecla Mining. In 1981 Mr. Calhoun's extensive
      public service record includes membership on President Ronald Reagan's Strategic
      Minerals Task Force, President Gerald Ford's Inflation Task Force; Director
      of
      the Silver Institute; Trustee of the Northwest Mining Association; Chairman
      of
      the Mining Advisors Committee to the Governors of Washington and Idaho;
      President of the Idaho Mining Association; Chairman of Advisory Committee of
      Idaho College of Mines; and numerous other civil and professional organizations.
      Mr. Calhoun has a Bachelor of Science degree in Mining/Geology from the
      University of Texas. Mr. Calhoun spends less than 10% of his time on Seabridge
      business.





Thomas
      Dawson has been a Chartered Accountant since 1961. He is a retired senior audit
      and accounting partner with 40 years of experience at Deloitte & Touche LLP,
      Chartered Accountants. Mr. Dawson currently serves as a Director and Chief
      Financial Officer of Arizona Star Resource Corp. He received his B.Comm. from
      Loyola College (now Concordia University), Canada, in 1959. Mr. Dawson is also
      a
      director of SouthernEra




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Diamonds
      Inc., WFI Industries Ltd., Energy Split Corp. and Anvil Mining Limited. Mr.
      Dawson spends less than 10% of his time on Seabridge business.





Henry
      Fenig has been the Chief Financial Officer and Vice President of Friedberg
      Mercantile Group Ltd. (FMG) since April 1983. FMG is a Toronto based, privately
      owned Investment Dealer and Futures Commission Merchant and member of the
      Toronto Stock Exchange. Mr. Fenig holds primary responsibility for overseeing
      compliance for FMG and its affiliates with all applicable Canadian and United
      States laws and regulations. Since December 1984, Mr. Fenig has been Executive
      Vice-President, Treasurer and a Director of FCMI Financial Corporation, the
      sole
      shareholder of Pan Atlantic Bank and Trust Limited. Mr. Fenig has a Bachelor
      of
      Arts degree in Economics from Yeshiva College and a Masters of Business
      Administration degree in International Business and Marketing from Columbia
      University in New York City. Mr. Fenig spends less than 10% of his time on
      Seabridge business.





Louis
      Fox
      has more than 25 years experience in precious metals trading, merchanting and
      merchant banking activities. From 1984 to 1999, Mr. Fox was a Senior Vice
      President of Gerald Metals, Inc., commodity trading, refining and merchant
      banking firm, in Stamford, Connecticut. At Gerald Metals, Mr. Fox was the head
      of the company's worldwide precious metals group. Prior to Gerald Metals, from
      1974 to 1981, Mr. Fox was a Vice President of J. Aron & Co., a precious
      metals trading firm. Following the acquisition of J. Aron & Co. by Goldman
      Sachs in 1981, Mr. Fox was a Vice President of Goldman Sachs through 1984.
      Mr.
      Fox holds a B.A. from the University of Pittsburgh and a J.D. from the Boston
      University Law School. Mr. Fox spends less than 10% of his time on Seabridge
      business.





Eliseo
      Gonzalez-Urien has over 30 years of experience in the
      mining industry. From 1989 through 2001 Mr. Gonzalez-Urien held various
      executive positions with Placer Dome Inc. including Senior Vice President of
      the
      parent company and President of Placer Dome Exploration Inc. During this period
      he was charged with ultimate responsibility for Placer Dome ́s worldwide
      exploration activities. Prior to Placer Dome, Mr. Gonzalez-Urien held senior
      positions with BHP-Utah Inc. and Noranda. He holds a degree in Geology from
      the
      University of Santiago, Chile, followed by post graduate studies in Geology
      at
      the University of California, Berkley. Mr. Gonzalez-Urien spends less than
      10%
      of his time on Seabridge business.





William
      Threlkeld has served as Senior Vice President of Seabridge since November 2001,
      and from 2000 to 2001 acted as a technical consultant to the Company. From
      1997
      to 2000, he was Vice President, Exploration for Greenstone Resources Ltd. and
      was responsible for resource delineation on three Central American gold deposits
      and development of an organization and strategy to identify new mineral
      investments. From 1991 to 1997, Mr. Threlkeld was Exploration Manager and
      Vice President of Placer Dome and was responsible for all of Placer Dome’s
      exploration activity and investment in Latin America. Mr. Threlkeld obtained
      his
      MSc in Economic Geology from the University of Western Ontario. Mr. Threlkeld
      spends 100% of his time on Seabridge business.




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Roderick
      Chisholm was appointed Secretary of Seabridge in June 2003 and Chief Financial
      Officer of Seabridge in August 2004. Since 1981, Mr. Chisholm has been a
      financial officer and corporate secretary of a number of Canadian junior
      exploration companies. Prior thereto he was an audit manager with Deloitte
&
Touche LLP, Chartered Accountants. Mr. Chisholm is a Chartered Accountant and
      spends approximately 70% of his time on Seabridge business.





Other
      than as set forth below, no Director and/or Executive Officer has been the
      subject of any order, judgment, or decree of any governmental agency or
      administrator or of any court or competent jurisdiction, revoking or suspending
      for cause any license, permit or other authority of such person or of any
      corporation of which he is a Director and/or Executive Officer, to engage in
      the
      securities business or in the sale of a particular security or temporarily
      or
      permanently restraining or enjoining any such person or any corporation of
      which
      he is an officer or director from engaging in or continuing any conduct,
      practice, or employment in connection with the purchase or sale of securities,
      or convicting such person of any felony or misdemeanor involving a security
      or
      any aspect of the securities business or of theft or of any felony. Mr. Chisholm
      served as Secretary-Treasurer of Canuc Resources Corp. (CDN-OTC: CANC) in 2000
      when a cease trade order was issued halting all trading of the common shares
      of
      Canuc due to failure to file financial statements. The cease trade order remains
      in effect as of the date hereof.





There
      are
      no arrangements or understandings between any two or more Directors or Executive
      Officers, pursuant to which he was selected as a Director or Executive Officer.
      There are no family relationships between any Directors or Executive Officers.





**COMPENSATION**





The
      Company had no arrangements pursuant to which directors are compensated by
      the
      Company or its subsidiaries for their services in their capacity as directors,
      or for committee participation, involvement in special assignments or for
      services as consultant or expert during the most recently completed fiscal
      year.





During
      2003 the Company adopted a formalized stock option plan, approved by its
      shareholders, for the granting of incentive stock options. To assist the Company
      in compensating, attracting, retaining and motivating personnel, the Company
      grants stock options to Directors, Executive Officers and employees; refer
      to
      ITEM #10, "Stock Options".





Table
      No.
      7 sets forth the compensation paid to the Company’s executive officers and
      members of its administrative body during the last three fiscal
      years.




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          of Contents





Table
      No.
      7


Summary
      Compensation Table


All
      Figures in Canadian Dollars unless otherwise noted







Name
            Year
            Salary
            Options
                Granted (1)
            Other
                CompensationRudi
                Fronk,
              President,
                CEO and Director
            2005
              2004
              2003
            $250,000
              $250,000
              $180,000
            Nil
              Nil
              Nil
            $7,750
              $43,269
              $14,348
                (2)James
                Anthony,
              Chairman
            2005
              2004
              2003
            Nil
              Nil
              Nil
            Nil
              Nil
              Nil
            $120,000
              $132,500
              $60,000Frederick
                Banfield,
              Director
            2005
              2004
              2003
            Nil
              Nil
              Nil
            Nil
              Nil
              Nil
            US$20,000
              US$15,000
              US$7,500William
                Calhoun,
              Director
            2005
              2004
              2003
            Nil
              Nil
              Nil
            Nil
              Nil
              65,000
            US$20,000
              US$15,000
              US$7,500Vahid
                Fathi (3),
              Director
            2005
              2004
              2003
            Nil
              Nil
              Nil
            Nil
              Nil
              Nil
            US$20,000
              US$15,000
              US$7,500Henry
                Fenig,
              Director
            2005
              2004
              2003
            Nil
              Nil
              Nil
            Nil
              Nil
              Nil
            US$20,000
              US$15,000
              US$7,500Louis
                Fox,
              Director
            2005
              2004
              2003
            Nil
              Nil
              Nil
            Nil
              Nil
              Nil
            US$20,000
              US$15,000
              US$7,500Roderick
                Chisholm
              Secretary
                and CFO
            2005
              2004
              2003
            Nil
            Nil
              115,000
              15,000
            $145,000
              $106,000
              $43,360William
                Threlkeld,
              Senior
                VP
            2005
              2004
              2003
            $160,000
              $156,000
              $107,000
            50,000
              Nil
              Nil
            $29,200
              Nil
              Nil





(1) The
      stock options were granted under the stock option plans which are described
      under “Item 10: Stock Options”


(2) The
      “Other Compensation” listed for Rudi Fronk, President, relate to certain
      educational expenses reimbursed to Mr. Fronk by the Corporation and in 2004
      also
      includes a $25,000 bonus.


(3) Mr.
      Fathi resigned as a director in January 2006.





No
      funds
      were set aside or accrued by the Company during Fiscal 2005 to provide pension,
      retirement or similar benefits for Directors or Executive Officers.




**Staffing**




The
      Company currently has 4 employees and 3 executive officers.




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**Share
      Ownership**





The
      Company’s shares are publicly held. The Company is not controlled by another
      corporation as described below.





Table
      No.
      8 lists, as of March 15, 2006, Directors and Executive Officers who beneficially
      own the Company's voting securities and the amount of the Company’s voting
      securities owned by the Directors and Executive Officers as a group.





Table
      No.
      8


Shareholdings
      of Directors and Executive Officers





Title
              Of
              Class
            Name
                of Beneficial Owner
            Amount
                and Nature of Beneficial Ownership
            Percent
              of
              ClassCommon
            James
                Anthony (1)
            1,438,125
            4.39%Common
            Rudi
                Fronk (2)
            1,627,000
            4.94%Common
            Frederick
                Banfield (3)
            245,000
            0.76%Common
            William
                Calhoun (4)
            208,334
            0.65%Common
            Thomas
                Dawson (5)
            64,400
            0.20%Common
            Henry
                Fenig (6)
            180,000
            0.56%Common
            Louis
                Fox (7)
            339,000
            1.05%Common
            Eliseo
                Gonzalez-Urien (8)
            75,000
            0.23%Common
            William
                Threlkeld (9)
            390,000
            1.20%Common
            Roderick
                Chisholm (10)
            146,000
            0.45%**Total
                Directors/Officers (11)**
            **4,712,859**
            **13.54%**





(1)
            Of
                these shares 333,334 represent currently exercisable share purchase
                options; 66,666 represent share purchase options subject to certain
                vesting requirements; 125,000 represent share purchase options subject
                to
                shareholder approval and certain vesting requirements; and 438,334
                shares
                are held indirectly.


(2)
            Of
                these shares 430,334 represent currently exercisable share purchase
                options; 66,666 represent share purchase options subject to certain
                vesting requirements; and 250,000 represent share purchase options
                subject
                to shareholder approval and certain vesting requirements.


(3)
            Of
                these shares 75,000 represent currently exercisable share purchase
                options
                and 100,000 represent share purchase options subject to shareholder
                approval and certain vesting requirements.


(4)
            Of
                these shares 65,000 represent currently exercisable share purchase
                options
                and 100,000 represent share purchase options subject to shareholder
                approval and certain vesting requirements.


(5)
            Of
                these shares 50,000 represent share purchase options subject to
                shareholder approval and certain vesting requirements and 11,400
                are held
                indirectly.


(6)
            Of
                these shares 80,000 represent currently exercisable share purchase
                options
                and 100,000 represent share purchase options subject to shareholder
                approval and certain vesting requirements.




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(7)
            Of
                these shares 25,000 represent currently exercisable share purchase
                options
                and 100,000 represent share purchase options subject to shareholder
                approval and certain vesting requirements.


(8)
            Of
                these shares 50,000 represent share purchase options subject to
                shareholder approval and certain vesting
                requirements.


(9)
            Of
                these shares, 266,667 represent currently exercisable share purchase
                options and 83,333 represent share purchase options subject to certain
                vesting requirements.


(10)
            Of
                these shares, 106,667 represent currently exercisable share purchase
                options and 33,333 represent share purchase options subject to certain
                vesting requirements.


(11)
            See
                notes (1) through (10)





Percent
      of Class number is based on 32,211,685 shares outstanding as of March 15, 2006
      and Stock options held by each beneficial holder.





Based
      upon information provided by the Company’s transfer agent, as of March 15, 2006,
      approximately 7.5 % of the Company’s common shares were held of record by US
      residents.





**Board
      Practices**





**Mandate
      of the Board**





The
      Company's Board of directors is responsible for the supervision of the
      management of the Company's business and affairs. Under its governing statute
      (the Canada Business Corporations Act), the Board is required to carry out
      its
      duties with a view to the best interests of the Company. The Board specifically
      recognizes its responsibility for the following areas:




(a)   
        representing the
        interests of the shareholders in all significant decisions affecting the
        Company
        and ensuring that shareholders are
        keptinformed of developments affecting their Company;
  (b)    reviewing
        and approving corporate objectives, goals and strategies with a view to
        enhancing shareholder value;




(c)    reviewing
      and approving the Company’s operating plans and monitoring
      performance;




(d)    reviewing
      significant operational and financial issues as they arise and providing
      direction to management on these matters;




(e)    acting
      diligently to ensure that the Company fulfils its legal and regulatory
      requirements;




(f)    
      evaluating the effectiveness of senior management and establishing their
      compensation; and




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(g)    evaluating
      whether of not directors receive the information they require to perform their
      duties as directors.




The
      frequency of the meetings of the Board of directors as well as the nature of
      agenda items change depending upon the state of the Company's affairs and in
      light of opportunities or risks which the Company faces.





**Composition
      of the Board**





The
      TSE
      Report recommends that a Board of directors be constituted with a majority
      of
      individuals who qualify as "unrelated directors". The TSE Report defines an
      "unrelated director" as a director who is independent of management and free
      from any interest and any business or other relationship, which could, or could
      reasonably be perceived to, materially interfere with that director's ability
      to
      act with a view to the best interest of the Company, other than an interest
      arising from shareholding. The Company does not have a "significant"
      shareholder, defined in the TSE Report as a shareholder with the ability to
      exercise a majority of votes for the election of directors.





The
      directors have examined the relevant definitions in the TSE Report and have
      individually considered their respective interests in and relationship with
      the
      Company. As a consequence, the Board has concluded that five of the Board's
      present eight members are "unrelated" within the meaning of the TSE Report:
      Frederick A. Banfield; William Calhoun; Thomas C. Dawson; Henry Fenig and Louis
      J. Fox. The Corporate Governance Committee is responsible for reviewing and
      recommending a suitable approach for the Company to assess director
      performance.





The
      Board
      considers eight directors to be an appropriate size for the Board at the current
      time. The Board believes that the inclusion of the President and Chief Executive
      Officer, Rudi P. Fronk, on the Company's Board of directors is useful to the
      effective governance of the Company. Each director brings to the Board a
      specific area of expertise which is instrumental in creating a Board which
      is
      able to implement the Company’s strategy effectively.





At
      present, in addition to those matters which must by law be approved by the
      Board, management seeks Board approval for any transaction which is out of
      the
      ordinary course of business or could be considered to be material to the
      business of the Company.





**Committees**




The
      Board
      has assigned specific governance responsibilities to three committees. A
      description of the mandate of each committee follows:





Audit
      Committee




The
      following constitutes the Charter of the Audit Committee.




The
      Audit
      Committee of Seabridge is a committee of the Board composed entirely of three
      outside and unrelated directors. Its overall goal is to ensure that the Company
      adopts and follows a policy of full, plain, true and timely disclosure of
      material financial




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information
      to its stakeholders. It reviews all material matters affecting the risks and
      financial well being of the Company and is a key part of the Corporate
      Governance system. The Committee is mandated to satisfy the requirements of
      the
      Canada Business Corporations Act.





The
      Audit
      Committee meets at a minimum, quarterly and on such other occasions as required.
      The auditors are invited to attend the meetings called to discuss the annual
      audit plan and the final review of the year-end financial statements. At least
      annually, the Committee meets with the auditors to review management’s
      performance relating to financial reporting matters.





Specifically,
      the Committee:





(a)
            reviews
                the annual statements of the Company and makes recommendations to
                the
                Board with respect to these
                statements,




(b)
            reviews
                the quarterly financial statements and makes recommendations to the
                Board
                regarding these financial
                statements,




(c)
            reviews
                and approves financial information in all prospectuses, offering
                circulars, and similar documents,




(d)
            oversees
                the adequacy and accuracy of the Company’s financial disclosure policies
                and obligations,




(e)
            reviews
                significant accounting policies and
                estimates,




(f)
            monitors
                the Company’s internal controls, financial systems and procedures, and
                management information systems,




(g)
            oversees
                management’s reporting on internal
                control,




(h)
            meets
                with the Company’s auditors to review management’s financial stewardship
                and to review their recommendations to management,
                and




(i)
            recommends
                the appointment of auditors and reviews the terms of the audit engagement
                and the appropriateness of the proposed
                fee,




(j)
            reviews
                through discussions or by way of a formal document the plan followed
                for
                the annual audit with the auditors and
                management,




(k)
            evaluates
                the performance of the auditors,




(l)
            confirms
                the independence of auditors,




(m)
            establishes
                procedures for the receipt, retention and treatment of complaints
                received
                regarding accounting, internal accounting controls or auditing matters,
                and




(n)
            establishes
                procedures for the confidential, anonymous submission by employees
                of
                concerns regarding questionable accounting or auditing
                matters.




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Corporate
      Governance Committee




The
      Corporate Governance Committee is presently composed of all five “un-related”
and outside directors. This Committee has prepared and obtained approval by
      the
      Board of written policies on Fair Disclosure, Insider Trading and Conflict
      of
      Interest. Reporting to the full Board of Directors, this Committee is mandated
      to:





1.
            Prepare
                and recommend to the Board on an annual basis, proposed goals for
                the
                Company and its CEO and a mandate for the
                CEO;




2.
            Ensure
                that the Board is adequately informed of developments and issues
                within
                the Company such that it is able to fulfill its duties and
                responsibilities;




3.
            Ensure
                that the Board reviews and approves all major corporate decisions
                which
                could reasonably be expected to affect shareholder
                value;




4.
            Assess
                the effectiveness of the Board as a whole, of each of the directors
                and of
                each committee of directors and consider the impact that the number
                of
                directors has on effectiveness of the
                Board.




5.
            Conduct
                an annual discussion among non-management directors on the role and
                effectiveness of independent
                directors;




6.
            Ensure
                that each Board Committee has a clear, written mandate and is performing
                diligently the tasks necessary to limit Board
                liability;




7.
            Oversee
                the administration of the Company’s Fair Disclosure Policy and Insider
                Trading Policy;




8.
            Oversee
                an annual review of each director’s business interests in accordance with
                the Company’s Conflict of Interest Policy to ascertain which conflicts
                might exist with respect to the interests of Seabridge and how such
                conflicts, if any, are to be managed so as to ensure the independence
                of
                directors and to protect the interests of Seabridge and its
                shareholders;




9.
            Review
                disclosure of corporate governance matters to ensure that shareholders
                are
                adequately informed of the Board’s procedures for governance on their
                behalf.





Compensation
      Committee




The
      Compensation Committee is presently composed of three directors, all of which
      are outside and unrelated directors. Reporting to the full Board of Directors,
      this Committee is mandated to:





1.
            On
                an annual basis, review the total compensation of the President and
                Vice
                President(s) against their performance, mandates and goals and make
                recommendations on their compensation to the
                Board;




2.
            Review,
                approve and recommend to the Board for confirmation all grants of
                options
                to all directors and employees; ensure the proper administration
                of the
                Company’s options program in conformity with the Company’s Option
                Plan;




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3.
            Review
                on an annual basis the Company’s overall hiring and compensation practices
                with reference to industry norms.




None
      of
      the members of the Committee have any indebtedness to the Company or any of
      its
      subsidiaries nor have they any material interest, or have any associates or
      affiliates which have any material interest, direct or indirect, in any actual
      or proposed transaction in the last financial year which has materially affected
      or would materially affect the Company or any of its subsidiaries.





The
      compensation of the Company's executive officers is determined by the Board
      of
      Directors upon recommendations made by the Committee. The Committee met twice
      during the last financial year. The Company's executive compensation program
      consists of an annual base salary and a longer-term component consisting of
      stock options, however the Committee may also recommend a bonus for management
      or its directors in the future.




**Item
      7. Major Shareholders and Related Party
      Transactions**




As
      of
      March 15, 2006, Pan Atlantic Bank and Trust Ltd. owned 6,129,652 shares of
      the
      Company representing 19.0% of the outstanding shares of the Company. In
      addition, as of March 15, 2006 principals of, and funds managed by, the
      Friedberg Mercantile Group Ltd. owned 1,093,400 shares of the Company
      representing 3.4% of the outstanding shares of the Company. Pan Atlantic Bank
      and Trust Ltd. is ultimately beneficially owned and controlled by Albert D.
      Friedberg and members of his immediate family. Albert D. Friedberg is the
      President and a director of Friedberg Mercantile Group Ltd. Henry Fenig, a
      Director of the Company, is CFO and Vice President of Friedberg Mercantile
      Group
      Ltd. The Company is not aware of any other person/company who beneficially
      owns
      5% or more of the Company’s voting securities.





No
      shareholders of the Company have different voting rights from any other
      shareholder.





There
      are
      no arrangements known to the Company, the operation of which as of a subsequent
      date, could result in a change of control of the Company.





**INTEREST
      OF MANAGEMENT IN CERTAIN TRANSACTIONS**





During
      the fiscal year ended December 31, 2005, Mintec, Inc., a private company
      controlled by Fred Banfield, a Director of Seabridge, was paid $39,400 for
      technical services provided by his company related to the mineral properties.
      These technical services were for consulting and computer software for geologic
      modeling, reserve estimation, mine planning and database management. The Company
      negotiated the agreement at arms length, after the Company reviewed all
      available software in the marketplace and determined that the agreement
      negotiated with Mintec was the most cost effective available.




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Pan
      Atlantic Bank and Trust Ltd. has been an investor in two convertible debt
      offerings and two private placement of common shares by Seabridge. Pan Atlantic
      Bank and Trust Ltd.’s sole shareholder is FMCI Financial Corporation. Henry
      Fenig, Director of Seabridge, serves as Executive Vice-President, Treasurer
      and
      a Director of FMCI.





None
      of
      the Company’s interests in its mineral properties were acquired from affiliates.




**Item
      8.** **Financial
      Information**




The
      financial statements as required under ITEM #8 are attached hereto and found
      immediately following the text of this Annual Report. The audit report of KPMG
      LLP, Chartered Accountants, is included herein immediately preceding the
      financial statements and schedules.





There
      have been no undisclosed significant changes of financial condition since the
      most recent financial statements dated December 31, 2005.




**Item
      9.****The Offer and
      Listing**




**A.**     **Offer
      and Listing Details**





The
      Company's common shares began trading on the Vancouver Stock Exchange (now
      the
      TSX Venture Exchange) in Vancouver, British Columbia, Canada in Sept 1979.
      The
      current stock symbol is “SEA”, and the CUSIP number is #811916105.





The
      Company’s common shares began trading on the American Stock Exchange in the
      United States in April 2004. The current stock symbol is “SA”.





Table
      No.
      9 lists the volume of trading and high, low and closing sales prices on the
      TSX
      Venture Exchange for the Company's common shares over the disclosed periods
      for
      the last 12 fiscal quarters and the last five fiscal years. The Company’s common
      shares commenced trading on the American Stock Exchange on April 20, 2004 and
      the corresponding trading information is shown in Table No. 9.





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 Table
          of Contents




Table
      No.
      9


Common
      Share Trading Activity





TSX
                Venture Exchange (“SEA”)
            
            American
                Stock Exchange (“SA”)(Canadian
                Dollars)
            
            (United
                States Dollars)Volume
            
            High
            
            Low
            
            Close
            
            Volume
            
            High
            
            Low
            
            CloseFebruary
                2006
            
            
            439,240
            
            $
            10.50
            
            $
            7.80
            
            $
            8.66
            
            
            3,182.700
            
            $
            9.52
            
            $
            6.80
            
            $
            7.64January
                2006
            
            
            1,224,174
            
            $
            11.75
            
            $
            9.60
            
            $
            10.80
            
            
            4,971,300
            
            $
            10.13
            
            $
            8.51
            
            $
            9.503
                Months Ended 31-Dec-05
            
            
            1,744,743
            
            $
            12.00
            
            $
            5.57
            
            $
            11.01
            
            
            11,781,343
            
            $
            10.49
            
            $
            4.60
            
            $
            9.403
                Months Ended 30-Sep-05
            
            
            1,641,935
            
            $
            7.05
            
            $
            2.99
            
            $
            7.05
            
            
            8,615,235
            
            $
            6.08
            
            $
            2.47
            
            $
            5.993
                Months Ended 30-Jun-05
            
            
            1,339,578
            
            $
            3.30
            
            $
            2.40
            
            $
            3.12
            
            
            3,346,878
            
            $
            2.78
            
            $
            1.91
            
            $
            2.563
                Months Ended 31-Mar-05
            
            
            1,475,938
            
            $
            4.23
            
            $
            3.15
            
            $
            3.25
            
            
            2,993,738
            
            $
            3.75
            
            $
            2.60
            
            $
            2.713
                Months Ended 31-Dec-04
            
            
            697,155
            
            $
            5.00
            
            $
            4.00
            
            $
            4.30
            
            
            1,598,000
            
            $
            4.20
            
            $
            3.12
            
            $
            3.633
                Months Ended 30-Sep-04
            
            
            798,164
            
            $
            4.44
            
            $
            3.26
            
            $
            4.36
            
            
            1,503,500
            
            $
            3.49
            
            $
            2.56
            
            $
            3.383
                Months Ended 30-Jun-04
            
            
            1,823,700
            
            $
            5.15
            
            $
            2.90
            
            $
            4.15
            
            
            1,494,850
            
            $
            3.90
            
            $
            2.12
            
            $
            3.103
                Months Ended 31-Mar-04
            
            
            1,909,600
            
            $
            6.00
            
            $
            4.15
            
            $
            5.11
            
            
            N/A
            
            
            N/A
            
            
            N/A
            
            
            N/A3
                Months Ended 31-Dec-03
            
            
            3,422,500
            
            $
            5.50
            
            $
            3.25
            
            $
            5.30
            
            
            N/A
            
            
            N/A
            
            
            N/A
            
            
            N/A3
                Months Ended 30-Sep-03
            
            
            3,253,482
            
            $
            4.28
            
            $
            1.86
            
            $
            4.00
            
            
            N/A
            
            
            N/A
            
            
            N/A
            
            
            N/A3
                Months Ended 30-Jun-03
            
            
            1,670,803
            
            $
            2.60
            
            $
            2.01
            
            $
            2.12
            
            
            N/A
            
            
            N/A
            
            
            N/A
            
            
            N/A3
                Months Ended 31-Mar-03
            
            
            2,572,700
            
            $
            3.56
            
            $
            2.02
            
            $
            2.55
            
            
            N/A
            
            
            N/A
            
            
            N/A
            
            
            N/A3
                Months Ended 31-Dec-02
            
            
            4,628,300
            
            $
            3.44
            
            $
            1.84
            
            $
            3.39
            
            
            N/A
            
            
            N/A
            
            
            N/A
            
            
            N/A3
                Months Ended 30-Sep-02
            
            
            4,032,200
            
            $
            3.10
            
            $
            1.50
            
            $
            2.35
            
            
            N/A
            
            
            N/A
            
            
            N/A
            
            
            N/A3
                Months Ended 30-Jun-02
            
            
            13,655,800
            
            $
            3.70
            
            $
            0.70
            
            $
            2.90
            
            
            N/A
            
            
            N/A
            
            
            N/A
            
            
            N/A3
                Months Ended 31-Mar-02
            
            
            4,508,300
            
            $
            1.15
            
            $
            0.38
            
            $
            0.96
            
            
            N/A
            
            
            N/A
            
            
            N/A
            
            
            N/A





American
      Depository Receipts. Not applicable.


Other
      Securities to be Registered. Not applicable





**B.****Plan
      and Distribution**





Not
      Applicable





**C.****Markets**





The
      Company’s common shares currently trade on the TSX Venture Exchange under the
      symbol “SEA” and on the American Stock Exchange under the symbol
“SA”.





**United
      States Market**





The
      Common Shares became listed on the American Stock Exchange effective April
      20,
      2004 under the symbol “SA”.





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**Item
      10.****Additional
      Information**




**A.****Share
      Capital**





Not
      Applicable





**B.****Memorandum
      and Articles of Association**





Information
      regarding the Company’s Certificate of Incorporation, By-Laws and other charter
      documents is incorporated by reference to Item 10B to the Company’s registration
      statement on Form 20-F dated February 18, 2004.





**C.****Material
      Contracts**





The
      Company considers the following as material contracts, which have been entered
      into by the Company which are currently in effect:





1.
            Agreement
                for the purchase and sale of the Red Mountain Project and Willoughby
                Joint
                Venture between Seabridge and North American Metals
                Corp.


2.
            Agreement
                between the Company and Platoro West Incorporated covering the
                Castle/Black Rock project;


3.
            Agreement
                between the Company and Platoro West Incorporated covering the Hog
                Ranch
                project;


4.
            Agreement
                between the Company and Placer Dome covering the Kerr/Sulphurets
                project;


5.
            Agreement
                between the Company and Atlas covering the Grassy Mountain
                project;


6.
            Agreement
                between the Company and Quartz Mountain Resources covering the Quartz
                Mountain project.


7.
            Agreement
                between the Company and Noranda Inc. covering the Kerr/Sulphurets
                project.


8.
            Agreement
                between the Company, Newmont Canada and Total Resources covering
                the
                Courageous Lake project.





Details
      and a discussion of each material contract are given in the detailed property
      section contained in Item 4 of this Annual Report. Copies of these contracts
      were filed as exhibits to the Company’s registration statement on Form 20-F
      dated February 18, 2004.





**D.****Exchange
      Controls and Other Limitations Affecting Security Holders**





The
      Company is not aware of any Canadian federal or provincial laws, decrees, or
      regulations that restrict the export or import of capital, including foreign
      exchange controls, or that affect the remittance of dividends, interest or
      other
      payments to non-Canadian holders of the common shares. There are no limitations
      on the right of non-




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Canadian
      owners to hold or vote the common shares imposed by Canadian federal or
      provincial law or by the charter or other constituent documents of the
      Company.





The
      *Investment Canada Act*(the *"IC Ac*t") governs acquisitions of
      Canadian business by a non-Canadian person or entity. The *IC Act*requires a non-Canadian (as defined in the *IC Ac*t) making an
      investment to acquire control of a Canadian business, the gross assets of which
      exceed certain defined threshold levels, to file an application for review
      with
      the Investment Review Division of Industry Canada. The *IC Act*provides,
      among other things, for a review of an investment in the event of acquisition
      of
      "control" in certain Canadian businesses in the following
      circumstances:





1.     If
      the investor is a non-Canadian and is a national of a country belonging to
      the
      North American Free Trade Agreement ("NAFTA") and/or the World Trade
      Organization ("WTO") ("NAFTA or WTO National"), any direct acquisition having
      an
      asset value exceeding $179,000,000 is reviewable. This amount is subject to
      an
      annual adjustment on the basis of a prescribed formula in the *IC Act*to
      reflect inflation and real growth within Canada. This threshold level does
      not
      apply in certain sections of Canadian industry, such as uranium, financial
      services (except insurance), transportation services and cultural services
      (i.e.
      the publication, distribution or sale of books, magazines, periodicals (other
      than printing or typesetting businesses), music in print or machine readable
      form, radio, television, cable and satellite services; the publication,
      distribution, sale or exhibition of film or video recordings on audio or video
      music recordings), to which lower thresholds as prescribed in the *IC Act*are applicable.





2.    If
      the investor is a non-Canadian and is not a NAFTA or WTO National, any direct
      acquisition having an asset value exceeding $5,000,000 and any indirect
      acquisition having an asset value exceeding $50,000,000 is
      reviewable.





3.    If
      the investor is a non-Canadian and is NAFTA or WTO National, an indirect
      acquisition of control is reviewable if the value of the assets of the business
      located in Canada represents more than 50% of the asset value of the transaction
      or the business is involved in uranium, financial services, transportation
      services or cultural services (as set forth above).





Finally,
      certain transactions prescribed in the *IC Act*are exempted from review
      altogether.





In
      the
      context of the Company, in essence, three methods of acquiring control of a
      Canadian business are regulated by the *IC Ac*t: (i) the acquisition of
      all or substantially all of the assets used in carrying on business in Canada;
      (ii) the acquisition, directly or indirectly, of voting shares of a Canadian
      corporation carrying on business in Canada; or (iii) the acquisition of voting
      shares of an entity which controls, directly or indirectly, another entity
      carrying on business in Canada.





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An
      acquisition of a majority of the voting shares of a Canadian entity, including
      a
      corporation, is deemed to be an acquisition of control under the *IC
      Ac*t. However, under the *IC Ac*t, there is a rebuttable presumption
      that control is acquired if one-third of the voting shares of a Canadian
      corporation or an equivalent undivided interest in the voting shares of such
      corporation are held by a non-Canadian person or entity. An acquisition of
      less
      than one-third of the voting shares of a Canadian corporation is deemed not
      to
      be an acquisition of control. An acquisition of less than a majority, but
      one-third or more, of the voting shares of a Canadian corporation is presumed
      to
      be an acquisition of control unless it can be established that, on the
      acquisition, the Canadian corporation is not, in fact, controlled by the
      acquirer through the ownership of voting shares. For partnerships, trusts,
      joint
      ventures or other unincorporated Canadian entities, an acquisition of less
      than
      a majority of the voting interests is deemed not to be an acquisition of
      control.





In
      addition, if a Canadian corporation is controlled by a non-Canadian, the
      acquisition of control of any other Canadian corporation by such corporation
      may
      be subject to the prior approval of the Investment Review Division, unless
      it
      can be established that the Canadian corporation is not in fact controlled
      by
      the acquirer through the ownership of voting shares.





Where
      an
      investment is reviewable under the *IC Ac*t, the investment may not be
      implemented unless it is likely to be of net benefit to Canada. If an applicant
      is unable to satisfy the Minister responsible for Industry Canada that the
      investment is likely to be of net benefit to Canada, the applicant may not
      proceed with the investment. Alternatively, an acquirer may be required to
      divest control of the Canadian business that is the subject of the
      investment.





In
      addition to the foregoing, the *IC Act*provides for formal notification
      under the *IC Act*of all other acquisitions of control by Canadian
      businesses by non-Canadian investors. The notification process consists of
      filing a notification within 30 days following the implementation of an
      investment, which notification is for information, as opposed to review,
      purposes.





**E.****Taxation**





The
      following summary of the material Canadian federal income tax consequences
      generally applicable in respect of the common stock reflects the Company’s
      opinion. The tax consequences to any particular holder of common stock will
      vary
      according to the status of that holder as an individual, trust, corporation
      or
      member of a partnership, the jurisdiction in which that holder is subject to
      taxation, the place where that holder is resident and, generally, according
      to
      that holder’s particular circumstances. This summary is applicable only to
      holders who are resident in the United States, have never been resident in
      Canada, deal at arm’s length with the Company, hold their common stock as
      capital property and who will not use or hold the common stock in carrying
      on
      business in Canada. Special rules, which are not discussed in this summary,
      may
      apply to a United States holder that is an issuer that carries on business
      in
      Canada and elsewhere.





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This
      summary is based upon the provisions of the Income Tax Act of Canada and the
      regulations there under (collectively, the "Tax Act" or “ITA”) and the
      Canada-United States Tax Convention (the “Tax Convention”) as at the date of the
      Annual Report and the current administrative practices of Canada Customs and
      Revenue Agency. This summary does not take into account provincial income tax
      consequences.





Management
      urges each holder to consult his own tax advisor with respect to the income
      tax
      consequences applicable to him/her in his/her own particular
      circumstances.





**CANADIAN
      INCOME TAX CONSEQUENCES**





The
      summary below is restricted to the case of a holder (a “Holder”) of one or more
      common shares (“Common Shares”) who for the purposes of the Tax Act is a
      non-resident of Canada, holds his Common Shares as capital property and deals
      at
      arm’s length with the Company.




**Dividends**




A
      Holder
      will be subject to Canadian withholding tax (“Part XIII Tax”) equal to 25%, or
      such lower rates as may be available under an applicable tax treaty, of the
      gross amount of any dividend paid or deemed to be paid on his Common Shares.
      Under the Tax Convention, the rate of Part XIII Tax applicable to a dividend
      on
      Common Shares paid to a Holder who is a resident of the United States is, if
      the
      Holder is a company that beneficially owns at least 10% of the voting stock
      of
      the Company, 5% and, in any other case, 15% of the gross amount of the dividend.
      The Company will be required to withhold the applicable amount of Part XIII
      Tax
      from each dividend so paid and remit the withheld amount directly to the
      Receiver General for Canada for the account of the Holder.




**Disposition
      of Common Shares**




A
      Holder
      who disposes of Common Shares, including by deemed disposition on death, will
      not be subject to Canadian tax on any capital gain thereby realized unless
      the
      Common Share constituted “taxable Canadian property” as defined by the Tax Act.
      Generally, a common share of a public corporation will not constitute taxable
      Canadian property of a Holder unless he held the common share as capital
      property used by him carrying on a business in Canada, or he or persons with
      whom he did not deal at arm’s length alone or together held or held options to
      acquire, at any time within the 60 months preceding the disposition, 25% or
      more
      of the issued shares of any class of the capital stock of the
      Company.





A
      Holder
      who is a resident of the United States and realizes a capital gain on
      disposition of Common Shares that was taxable Canadian property will
      nevertheless, by virtue of the Treaty, generally be exempt from Canadian tax
      thereon unless (a) more than 50% of the value of the Common Shares is derived
      from, or from an interest in, Canadian real estate, including Canadian mineral
      resources properties, (b) the Common Shares formed part of the business property
      of a permanent establishment that the Holder has or had in Canada within





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the
      12
      months preceding disposition, or (c) the Holder (i) was a resident of Canada
      at
      any time within the ten years immediately preceding the disposition, and for
      a
      total of 120 months during any period of 20 consecutive years, preceding the
      disposition, and (ii) owned the Common Shares when he ceased to be resident
      in
      Canada.





A
      Holder
      who is subject to Canadian tax in respect of a capital gain realized on
      disposition of Common Shares must include one half of the capital gain (“taxable
      capital gain”) in computing his taxable income earned in Canada. The Holder may,
      subject to certain limitations, deduct one half of any capital loss (“allowable
      capital loss”) arising on disposition of taxable Canadian property from taxable
      capital gains realized in the year of disposition in respect to taxable Canadian
      property and, to the extent not so deductible, from such taxable capital gains
      of any of the three preceding years or any subsequent year.





**UNITED
      STATES FEDERAL INCOME TAX CONSEQUENCES**





The
      following is a discussion of material United States Federal income tax
      consequences, under the law, generally applicable to a U.S. Holder (as defined
      below) of common shares of the Company. This discussion does not cover any
      state, local or foreign tax consequences.





The
      following discussion is based upon the sections of the Internal Revenue Code
      of
      1986, as amended (“the Code”), Treasury Regulations, published Internal Revenue
      Service (“IRS) rulings, published administrative positions of the IRS and court
      decisions that are currently applicable, any or all of which could be materially
      and adversely changed, possible on a retroactive basis, at any time. In
      addition, the discussion does not consider the potential effects, both adverse
      and beneficial, or recently proposed legislation which, if enacted, could be
      applied, possibly on a retroactive basis, at any time. The discussion is for
      general information only and it is not intended to be, nor should it be
      construed to be, legal or tax advice to any holder or prospective holder of
      common shares of the Company and no opinion or representation with respect
      to
      the U.S. federal income tax consequences to any such holder or prospective
      holder is made. Management urges holders and prospective holders of common
      shares of the Company to consult their own tax advisors about the federal,
      state, local, and foreign tax consequences of purchasing, owning and disposing
      of common shares of the Company.





**U.S.
      Holders**





As
      used
      herein, a (“U.S. Holder”) includes a holder of common shares of the Company who
      is a citizen or resident of the United States, a corporation created or
      organized in or under the laws of the United States or of any political
      subdivision thereof, an estate whose income is taxable in the United States
      irrespective of source or a trust subject to the primary supervision of a court
      within the United States and control of a United States fiduciary as described
      in Section 7701(a)(30) of the Code. This summary does not address the tax
      consequences to, and U.S. Holder does not include, persons subject to special
      provisions of Federal income tax law, such as tax-exempt organizations,
      qualified retirement plans, financial institutions, insurance companies, real
      estate investment trusts, regulated investment companies, broker-dealers,
      non-resident alien individuals, persons or entities that





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have
      a
“functional currency” other than the U.S. dollar, shareholders who hold common
      shares as part of a straddle, hedging or conversion transaction, and
      shareholders who acquired their common shares through the exercise of employee
      stock options or otherwise as compensation for services. This summary is limited
      to U.S. Holders who own common shares as capital assets. This summary does
      not
      address the consequences to a person or entity holding an interest in a
      shareholder or the consequences to a person of the ownership, exercise or
      disposition of any options, warrants or other rights to acquire common
      shares.





**Distribution
      of Common Shares of the Company**





U.S.
      Holders receiving dividend distributions (including constructive dividends)
      with
      respect to common shares of the Company are required to include in gross income
      for United States Federal income tax purposes the gross amount of such
      distributions equal to the U.S. dollar value of such distributions on the date
      of receipt (based on the exchange rate on such date), to the extent that the
      Company has current or accumulated earnings and profits, without reduction
      for
      any Canadian income tax withheld from such distributions. Such Canadian tax
      withheld may be credited, subject to certain limitations, against the U.S.
      Holder’s United States Federal Income tax liability or, alternatively,
      individuals may deduct in computing the U.S. Holder’s United States Federal
      taxable income by those individuals who itemize deductions. (See more detailed
      discussion at “Foreign Tax Credit” below). To the extent that distributions
      exceed current or accumulated earnings and profits of the Company, they will
      be
      treated first as a return of capital up to the U.S. Holder’s adjusted basis in
      the common shares and thereafter as gain from the sale or exchange of the common
      shares. Dividend income will be taxed at marginal tax rates applicable to
      ordinary income while preferential tax rates for long-term capital gains are
      applicable to a U.S. Holder which is an individual, estate or trust. There
      are
      currently no preferential tax rates for long-term capital gains for a U.S.
      Holder which is a corporation.





In
      the
      case of foreign currency received as a dividend that is not converted by the
      recipient into U.S. dollars on the date of receipt, a U.S. Holder will have
      a
      tax basis in the foreign currency equal to its U.S. dollar value on the date
      of
      receipt. Generally any gain or loss recognized upon a subsequent sale of other
      disposition of the foreign currency, including the exchange for U.S. dollars,
      will be ordinary income or loss.





Dividends
      paid on the common shares of the Company will not generally be eligible for
      the
      dividends received deduction provided to corporations receiving dividends from
      certain United States corporations. A U.S. Holder which is a corporation may,
      under certain circumstances, be entitled to a 70% deduction of the United States
      source portion of dividends received from the Company (unless the Company
      qualifies as a “foreign personal holding company” or a “passive foreign
      investment company”, as defined below) if such U.S. Holder owns shares
      representing at least 10% of the voting power and value of the Company. The
      availability of this deduction is subject to several complex limitations which
      are beyond the scope of this discussion.





Under
      current Treasury Regulations, dividends paid on the Company’s common shares, if
      any, generally will not be subject to information reporting and generally will
      not be subject




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to
      U.S.
      backup withholding tax. However, dividends and the proceeds from a sale of
      the
      Company’s common shares paid in the U.S. through a U.S. or U.S. related paying
      agent (including a broker) will be subject to U.S. information reporting
      requirements and may also be subject to the 31% U.S. backup withholding tax,
      unless the paying agent is furnished with a duly completed and signed Form
      W-9.
      Any amounts withheld under the U.S. backup withholding tax rules will be allowed
      as a refund or a credit against the U.S. Holder’s U.S. federal income tax
      liability, provided the required information is furnished to the
      IRS.





**Foreign
      Tax Credit**





For
      individuals whose entire income from sources outside the United States consists
      of qualified passive income, the total amount of creditable foreign taxes paid
      or accrued during the taxable year does not exceed $300 ($600 in the case of
      a
      joint return) and an election is made under section 904(j), the limitation
      on
      credit does not apply.





A
      U.S.
      Holder who pays (or has withheld from distributions) Canadian income tax with
      respect to the ownership of common shares of the Company may be entitled, at
      the
      option of the U.S. Holder, to either a deduction or a tax credit for such
      foreign tax paid or withheld. Generally, it will be more advantageous to claim
      a
      credit because a credit reduces United States Federal income taxes on a
      dollar-for-dollar basis, while a deduction merely reduces the taxpayer’s income
      subject to tax. This election is made on a year-by-year basis and applies to
      all
      foreign income taxes (or taxes in lieu of income tax) paid by (or withheld
      from)
      the U.S. Holder during the year. There are significant and complex limitations
      which apply to the credit, among which is the general limitation that the credit
      cannot exceed the proportionate share of the U.S. Holder’s United States income
      tax liability that the U.S. Holder’s foreign source income bears to his/her or
      its worldwide taxable income in the determination of the application of this
      limitation. The various items of income and deduction must be classified into
      foreign and domestic sources. Complex rules govern this classification process.
      In addition, this limitation is calculated separately with respect to specific
      classes of income such as “passive income”, “high withholding tax interest”,
“financial services income”, “shipping income”, and certain other
      classifications of income. Dividends distributed by the Company will generally
      constitute “passive income” or, in the case of certain U.S. Holders, “financial
      services income” for these purposes. The availability of the foreign tax credit
      and the application of the limitations on the credit are fact specific and
      management urges holders and prospective holders of common shares of the Company
      to consult their own tax advisors regarding their individual
      circumstances.





**Disposition
      of Common Shares of the Company**





A
      U.S.
      Holder will recognize gain or loss upon the sale of common shares of the Company
      equal to the difference, if any, between (I) the amount of cash plus the fair
      market value of any property received, and (ii) the shareholder’s tax basis in
      the common shares of the Company. Preferential tax rates apply to long-term
      capital gains of U.S. Holders, which are individuals, estates or trusts. This
      gain or loss will be capital gain or loss if the common shares are capital
      assets in the hands of the U.S. Holder, which will be a short-term or long-term
      capital gain or loss depending upon the holding period of the U.S. Holder.
      Gains
      and




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losses
      are netted and combined according to special rules in arriving at the overall
      capital gain or loss for a particular tax year. Deductions for net capital
      losses are subject to significant limitations. For U.S. Holders, which are
      not
      corporations, any unused portion of such net capital loss may be carried over
      to
      be used in later tax years until such net capital loss is thereby exhausted,
      but
      individuals may not carry back capital losses. For U.S. Holders, which are
      corporations (other than corporations subject to Subchapter S of the Code),
      an
      unused net capital loss may be carried back three years from the loss year
      and
      carried forward five years from the loss year to be offset against capital
      gains
      until such net capital loss is thereby exhausted.





**Other
      Considerations**





In
      the
      following circumstances, the above sections of the discussion may not describe
      the United States Federal income tax consequences resulting from the holding
      and
      disposition of common shares of the Company.





**Foreign
      Personal Holding Company**





If
      at any
      time during a taxable year more than 50% of the total combined voting power
      or
      the total value of the Company’s outstanding shares is owned, actually or
      constructively, by five or fewer individuals who are citizens or residents
      of
      the United States and 60% (50% after the first tax year) or more of the
      Company’s gross income for such year was derived from certain passive sources
      (e.g. from interest income received from its subsidiaries), the Company would
      be
      treated as a “foreign personal holding company.” In that event, U.S. Holders
      that hold common shares of the Company would be required to include in gross
      income for such year their allocable portions of such passive income to the
      extent the Company does not actually distribute such income.





The
      Company does not believe that it currently has the status of a “foreign personal
      holding company”. However, there can be no assurance that the Company will not
      be considered a foreign personal holding company for the current or any future
      taxable year.





**Foreign
      Investment Company**




If
      50% or
      more of the combined voting power or total value of the Company’s outstanding
      shares are held, actually or constructively, by citizens or residents of the
      United States, United States domestic partnerships or corporations, or estates
      or trusts other than foreign estates or trusts (as defined by the Code Section
      7701(a)(31), and the Company is found to be engaged primarily in the business
      of
      investing, reinvesting, or trading in securities, commodities, or any interest
      therein, it is possible that the Company might be treated as a “foreign
      investment company” as defined in Section 1246 of the Code, causing all or part
      of any gain realized by a U.S. Holder selling or exchanging common shares of
      the
      Company to be treated as ordinary income rather than capital gains.





**Passive
      Foreign Investment Company**





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As
      a
      foreign corporation with U.S. Holders, the Company could potentially be treated
      as a passive foreign investment company (“PFIC”), as defined in Section 1297 of
      the Code, depending upon the percentage of the Company’s income which is
      passive, or the percentage of the Company’s assets which is held for the purpose
      of producing passive income.




Certain
      United States income tax legislation contains rules governing PFICs, which
      can
      have significant tax effects on U.S. shareholders of foreign corporations.
      These
      rules do not apply to non-U.S. shareholders. Section 1297 (a) of the Code
      defines a PFIC as a corporation that is not formed in the United States and,
      for
      any taxable year, either (I) 75% or more of its gross income is “passive
      income”, which includes interest, dividends and certain rents and royalties or
      (ii) the average percentage, by fair market value (or, if the company is a
      controlled foreign corporation or makes an election, by adjusted tax basis),
      of
      its assets that produce or are held for the production of “passive income” is
      50% or more. The taxation of a US shareholder who owns stock in a PFIC is
      extremely complex and is therefore beyond the scope of this discussion.
      Management urges US persons to consult with their own tax advisors with regards
      to the impact of these rules.




**Controlled
      Foreign Corporation**





A
      Controlled Foreign Corporation (CFC) is a foreign corporation more than 50%
      of
      whose stock by vote or value is, on any day in the corporation’s tax year, owned
      (directly or indirectly) by U.S. Shareholders. If more than 50% of the voting
      power of all classes of stock entitled to vote is owned, actually or
      constructively, by citizens or residents of the United States, United States
      domestic partnerships and corporations or estates or trusts other than foreign
      estates or trusts, each of whom own actually or constructively 10% or more
      of
      the total combined voting power of all classes of stock of the Company could
      be
      treated as a “controlled foreign corporation” under Subpart F of the Code. This
      classification would affect many complex results, one of which is the inclusion
      of certain income of a CFC, which is subject to current U.S. tax. The United
      States generally taxes United States Shareholders of a CFC currently on their
      pro rata shares of the Subpart F income of the CFC. Such United States
      Shareholders are generally treated as having received a current distribution
      out
      of the CFC’s Subpart F income and are also subject to current U.S. tax on their
      pro rata shares of the CFC’s earnings invested in U.S. property. The foreign tax
      credit described above may reduce the U.S. tax on these amounts. In addition,
      under Section 1248 of the Code, gain from the sale or exchange of shares by
      a
      U.S. Holder of common shares of the Corporation which is or was a United States
      Shareholder at any time during the five-year period ending with the sale or
      exchange is treated as ordinary income to the extent of earnings and profits
      of
      the Company (accumulated in corporate tax years beginning after 1962, but only
      while the shares were held and while the Company was “controlled”) attributable
      to the shares sold or exchanged. If a foreign corporation is both a PFIC and
      a
      CFC, the foreign corporation generally will not be treated as a PFIC with
      respect to the United States Shareholders of the CFC. This rule generally will
      be effective for taxable years of United States Shareholders beginning after
      1997 and for taxable years of foreign corporations ending with or within such
      taxable years of United States Shareholders. The PFIC provisions continue to
      apply in the case of PFIC that is also a CFC with respect to the




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U.S.
      Holders that are less than 10% shareholders. Because of the complexity of
      Subpart F, a more detailed review of these rules is outside of the scope of
      this
      discussion.





The
      amount of any backup withholding will not constitute additional tax and will
      be
      allowed as a credit against the U.S. Holder’s federal income tax
      liability.





***Filing
      of Information Returns***. Under a number of circumstances, United
      States Investor acquiring shares of the Company may be required to file an
      information return with the Internal Revenue Service Center where they are
      required to file their tax returns with a duplicate copy to the Internal Revenue
      Service Center, Philadelphia, PA 19255. In particular, any United States
      Investor who becomes the owner, directly or indirectly, of 10% or more of the
      shares of the Company will be required to file such a return. Other filing
      requirements may apply, and management urges United States Investors to consult
      their own tax advisors concerning these requirements.





**F.****Dividends
      and Paying Agents**


Not
      applicable




**G.****Statements
      by Experts**




Not
      applicable




**H.****Documents
      on Display**




The
      documents included as exhibits in Item 19 of this Report have been filed with
      the Securities and Exchange Commission (“SEC”) with the Company’s reports on
      Forms 6-K and 20-F, and may be reviewed at the SEC’s public reference room at
      450 Fifth Street, N.W., Washington D.C. 20549. Copies may be obtained, upon
      payment of a duplication fee, by writing the SEC or reviewed on the SEC’s
      website (http://www.sec.gov) or at the American Stock Exchange, 86
      Trinity Place, New York, New York 10006.




**Item
      11.****Quantitative
      and Qualitative Disclosures about Market Risk**




The
      Company’s mineral properties are all currently at the exploration stage and the
      Company’s operations are limited to exploring those properties. Therefore,
      Seabridge’s market risks are minimal. The Company does, however, have future
      property payments due in United States currency. As a Canadian Company,
      Seabridge’s cash balances are kept in Canadian funds. Therefore, Seabridge is
      exposed to some exchange rate risk. The Company considers the amount of risk
      to
      be manageable and does not currently, nor is likely in the foreseeable future,
      conduct hedging to reduce its exchange rate risk.





The
      Company has the following total anticipated required property, royalty and
      tax
      payments due in US dollars for the next 3 fiscal years by individual
      property:




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Payments
                Due
              (US$)Property
            
            
            2006
            
            
            2007
            
            
            2008Grassy
                Mountain
            
            $
            97,200
            
            $
            102,200
            
            $
            107,200Quartz
                Mountain (1)
            
            $
            10,000
            
            $
            10,000
            
            $
            10,000Castle/Black
                Rock
            
            $
            42,250
            
            $
            42,250
            
            $
            42,250Hog
                Ranch
            
            $
            49,500
            
            $
            52,000
            
            $
            54,500Other
                Nevada Properties
            
            $
            437,500
            
            $
            465,500
            
            $
            493,500





(1) The
      Quartz Mountain Property is currently under option to Quincy Energy Corp. who
      is
      required to pay all required holding costs during the option period.





The
      Company maintains a significant amount of cash and cash equivalents as well
      as
      in short term deposits. The Company relies upon this cash to meet its future
      needs. As the funds are in interest bearing accounts, the Company has some
      interest rate risk. However, as the Company is primarily concerned with the
      preservation of the capital for anticipated general and property expenditures
      and is not dependent upon the interest from these accounts to meet its ongoing
      requirements, management considers the interest rate risk to be minimal and
      to
      have little to no effect on the Company’s operations.




Competitive
      Environment




The
      Company competes with other resource companies for exploration properties,
      joint
      venture agreements and for the acquisition of attractive gold companies. There
      is a risk that this competition could increase the difficulty of concluding
      a
      negotiation on terms that Seabridge considers acceptable.




**Item
      12.****Description of
      Other Securities**




Not
      Applicable




**Part
      II**




**Item
      13.****Defaults,
      Dividend Arrearages and Delinquencies**




None




**Item
      14.****Material
      Modifications of Rights of Securities Holders and Use of
      Proceeds**




None





**Item
      15.****Controls and
      Procedures**





The
      Company's Chief Executive Officer and President and its Chief Financial Officer
      have evaluated the effectiveness of the Company's disclosure controls and
      procedures as




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such
      term
      is defined under Rules 13a-15(e) and 15d-15(e) of the U.S. Securities Exchange
      Act of 1934 (the "Exchange Act") as of the end of the period covered by this
      Report. Based on this evaluation, these officers have concluded that, as of
      the
      end of such period, the Company’s controls and procedures are effective in
      recording, processing, summarizing and reporting, on a timely basis, information
      required to be disclosed by the Company in its reports that it files or submits
      under the Exchange Act.





There
      have been no significant changes in the Company's internal controls and
      procedures that could materially affect these controls and procedures subsequent
      to the date of the Company's most recent evaluation.




**Item
      16A.****Audit
      Committee Financial Expert**





The
      Company’s Board of Directors has determined that Mr. Thomas Dawson, Chairman of
      the Audit Committee and an independent director of the Company, is an "audit
      committee financial expert."





**Item
      16B.****Code of
      Ethics**





The
      Code
      of Ethics, formally adopted by the Company in March 2005, and was included
      with
      the Company’s Form 20-F dated March 15, 2005.





**Item
      16C.****Principal
      Accountant Fees and Services**





The
      aggregate fees billed for each of the last two fiscal years for professional
      services rendered by KPMG, the Company's Auditors, are as follows:








2005
            
            2004Audit
                fees
            
            $
            100,000
            
            $
            72,300Audit
                related fees
            
            
            0
            
            
            0Tax
                Fees
            
            
            0
            
            
            0All
                Other Fees
            
            
            0
            
            
            0$
            100,000
            
            $
            72,300





**Item
      16D.****Exemptions
      from the Listing Standards for Audit Committees**





Not
      Applicable





**Item
      16E.****Purchases of
      Equity Securities by the Issuer and Affiliated Purchasers**





Not
      Applicable




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**Part
      III**




**Item
      17.****Financial
      Statements**




The
      Company's financial statements are stated in Canadian Dollars (CDN$) and are
      prepared in accordance with Canadian Generally Accepted Accounting Principles
      (GAAP), the application of which, in the case of the Company, conforms in all
      material respects for the periods presented with United States GAAP, except
      as
      disclosed in Note 11 to the 2005 audited financial statements.





The
      financial statements as required under ITEM #17 are attached hereto and found
      immediately following the text of this Annual Report.




**Item
      18.****Financial
      Statements**




The
      Company has elected to provide financial statements pursuant to ITEM
      #17.




**Item
      19.****Exhibits**




A.    The
      financial statements thereto as required under ITEM #17 are attached hereto
      and
      found immediately following the text of this Annual Report.




**Audited
      Financial Statements**




Auditor’s
      Report, dated March 14, 2006.





Consolidated
      Balance Sheets at December 31, 2005 and 2004





Consolidated
      Statements of Earnings (Loss) for the years ended December 31, 2005, 2004 and
      2003.





Consolidated
      Statements of Cash Flows for the years ended December 31, 2005, 2004, and 2003.





Consolidated
      Statements of Retained Earnings (Deficit) for the years ended December 31,
      2005,
      2004, and 2003.




Notes
      to
      Consolidated Financial Statements




B.    Other
      Exhibits





1.
            Certificate
                of Incorporation, Certificates of Name Change, Articles of Incorporation,
                Articles of Amalgamation and By-Laws (filed as Exhibit 1 to the






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Company’s
      Registration Statement on Form 20-F, dated February 18, 2004, (File No.
      000-50657) (the “Initial Form 20-F”) and incorporated herein by reference
      thereto).




2.
            Instruments
                defining the rights of holders of the securities being registered
                (see
                Exhibit Number 1).





3.
            Voting
                Trust Agreements - N/A





4.
            Material
                Contracts





1.
            Agreement
                for the purchase and sale of the Red Mountain Project and Willoughby
                Joint
                Venture between Seabridge and North American Metals Corp. (incorporated
                by
                reference to Exhibit 4-1 in Initial Form
                20-F).


2.
            Agreement
                between the Company and Platoro West Incorporated covering the
                Castle/Black Rock project (incorporated by reference to Exhibit 4-2
                in
                Initial Form 20-F).


3.
            Agreement
                between the Company and Platoro West Incorporated covering the Hog
                Ranch
                project (incorporated by reference to Exhibit 4-3 in Initial Form
                20-F).


4.
            Agreement
                between the Company and Placer Dome covering the Kerr/Sulphurets
                project
                (incorporated by reference to Exhibit 4-4 in Initial Form
                20-F).


5.
            Agreement
                between the Company and Atlas covering the Grassy Mountain project
                (incorporated by reference to Exhibit 4-5 in Initial Form
                20-F).


6.
            Agreement
                between the Company and Quartz Mountain Resources covering the Quartz
                Mountain project (incorporated by reference in Exhibit 4-9 in Initial
                Form
                20-F).


7.
            Agreement
                between the Company and Noranda Inc. covering the Kerr/Sulphurets
                project
                (incorporated by reference to Exhibit 4-7 in Initial Form
                20-F).


8.
            Agreement
                between the Company, Newmont Canada and Total Resources covering
                the
                Courageous Lake project (incorporated by reference to Exhibit 4-8
                in
                Initial Form 20-F).


5.      List
      of Foreign Patents - N/A


6.      Calculation
      of earnings per share - N/A


7.      Explanation
      of calculation of ratios - N/A


8.
            List
                of Subsidiaries


a)
            Seabridge
                Gold Corporation, a Nevada corporation incorporated December 28,
                2001,
                100% owned.


b)
            Pacific
                Intermountain Gold Corporation, a Nevada corporation incorporated
                on April
                26, 2002, 100% owned


c)
            5073
                N.W.T. Limited, a company incorporated under the laws of the Northwest
                Territories on July 9, 2002, 100%
                owned.




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9.
            Statement
                pursuant to the instructions to Item 8.A.4, regarding the financial
                statements filed in registration statements for initial public offerings
                of securities - N/A





10.
            Rule
                104 Notice - N/A





11.
            Code
                of Ethics (incorporated by reference in the Company’s Form 20-F dated
                March 15, 2005)





12.
            Certifications





12.1(*)
            Rule13a-14(a)/Rule15d-14(a)
                Certification of Chief
                Executive Officer





12.2(*)
            Rule
                13a14(a)/Rule 15d-14(a) Certification of Chief
                Financial Officer





13.
            Rule
                13a-14(b) Certifications





13.1(*)
            Certification
                of Chief Executive Officer pursuant
                to Section 906 of the Sarbanes-Oxley Act of
                2002


13.2(*)
            Certification
                of Chief Financial Officer pursuant
                to Section 906 of the Sarbanes-Oxley Act of
                2002





14.
            Opinion
                - N/A





(*) Filed
      herewith




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**Management’s
        Discussion and Analysis**
 The
        following is a discussion of the results of operations and financial condition
        of Seabridge Gold Inc. and its subsidiary companies for the years ended December
        31, 2005, December 31, 2004 and December 31, 2003. This report is dated March
        14, 2006. As the Company has no revenue generating projects at this time,
        its
        ability to carry out its business plan rests with its ability to secure equity
        and other financings.
 
 **Company
        Overview**
 Seabridge
        Gold Inc. is a development stage company engaged in the acquisition and
        exploration of gold properties located in North America. The Company is designed
        to provide its shareholders with exceptional leverage to a rising gold price.
        During the period 1999 through 2002, when the price of gold was lower than
        it is
        today, Seabridge acquired 100% interests in eight advanced-stage gold projects
        situated in North America. As the price of gold has moved higher over the
        past
        several years, Seabridge has commenced exploration activities and engineering
        studies at several of its projects. Seabridge’s principal projects include the
        Courageous Lake property located in the Northwest Territories, two projects
        in
        Nevada, the Kerr-Sulphurets and Red Mountain properties both located in British
        Columbia and the Grassy Mountain property located in Oregon. Seabridge’s common
        shares trade in Canada on the TSX Venture Exchange under the symbol “SEA” and in
        the United States on the American Stock Exchange under the symbol
“SA”.
  **Selected
          Annual Information**
 **Summary
                    operating results**($)
                
                2005
                
                2004
                
                2003Interest
                    income
                
                
                135,000
                
                
                83,000
                
                
                107,000Operating
                    costs
                
                
                2,113,000
                
                
                1,940,000
                
                
                1,103,000Write
                    off of mineral properties
                
                
                -
                
                
                -
                
                
                342,000Loss
                
                
                1,157,000
                
                
                1,226,000
                
                
                1,338,000Loss
                    per share
                
                
                0.04
                
                
                0.04
                
                
                0.05
 
 **Summary
                    balance sheets**($)
                
                2005
                
                2004
                
                2003Current
                    assets
                
                
                10,896,000
                
                
                4,396,000
                
                
                4,223,000Mineral
                    interests
                
                
                24,395,000
                
                
                20,999,000
                
                
                16,635,000Total
                    assets
                
                
                37,085,000
                
                
                27,172,000
                
                
                22,869,000Total
                    long-term liabilities
                
                
                1,407,000
                
                
                1,293,000
                
                
                1,378,000
  **Results
        of Operations**
 ***Year
        Ended December 31, 2005 Compared to Year Ended December 31,
        2004***
 The
        Net
        Loss for the year ended December 31, 2005 totaled $1,157,000 or $0.04 per
        share
        compared to $1,226,000, or $0.04 per share for the year ended December 31,
        2004.
        The loss in 2005 was reduced by $821,000 (2004 - $575,000) in income tax
        recovery largely relating to the Company renouncing the Canadian Exploration
        Expenses to the investors of the flow-through financings completed in 2004
        and
        2003, respectively. Also in 2004, Pacific Intermountain Gold Inc. (“PIGCO”) a
        subsidiary of the Company sold shares which it had received on optioning
        out a
        mineral property resulting in a gain of $75,000 offset by $19,000 representing
        the minority interest in the gain. Corporate and general expenses were slightly
        lower in 2005 compared to 2004 as additional expenses in 2004 were incurred
        related to the listing of the Company’s shares on the American Stock Exchange
        and investor relations activity offset by slightly higher management fees
        in
        2005. In 2005 stock option compensation expense was $361,000 compared to
        $115,000 in 2004. Approximately $332,000 of the 2005 amount relates to the
        recognition of compensation expense for the two-tiered options to management.
        The expense is for reaching the $6 and $9 share price vesting requirements
        with
        the consequent vesting of 500,000 of the 750,000 stock options
        outstanding.
 
 ***Year
        Ended December 31, 2004 Compared to Year Ended December 31,
        2003***
 The
        Net
        Loss for the year ended December 31, 2004 totaled $1,226,000 or $0.04 per
        share
        compared to $1,338,000, or $0.05 per share for the year ended December 31,
        2003.
        The loss in 2004 was reduced by a $575,000 income tax recovery largely relating
        to the recognition of the Company’s tax assets after renouncing the Canadian
        Exploration Expenses to the investors of the flow-through financings completed
        in 2003. Also in 2004, PIGCO sold shares which it had received on optioning
        out
        a mineral property resulting in a gain of $75,000 offset by $19,000 representing
        the minority interest in the gain. Corporate and general expenses increased
        by
        $867,000 in 2004 over 2003. Approximately 39% of this increase was due to
        increased investor relations activities including listing on the American
        Stock
        Exchange and
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  investor
        communications. Approximately 27% of the increase in corporate and general
        expenses was due to higher salaries and benefits for senior personnel and
        the
        hiring of a Chief Financial Officer. A further 15% of the increase reflects
        a
        full year of directors’ fees which the Company commenced paying in mid 2003 as
        well as the introduction of a comprehensive directors and officers liability
        insurance policy. About 12% of the increase was due to the recognition of
        the
        accretion for costs of reclamation liabilities. Finally, about 6% of the
        increase was due to higher costs of regulatory compliance, principally
        accounting and legal fees required by changes in regulations. In 2003, the
        Company wrote off the Tobin Basin exploration project in Nevada amounting
        to
        $342,000 due to unsuccessful exploration results.
 
 ***Year
        Ended December 31, 2003 Compared to Year Ended December 31,
        2002***
 The
        Net
        Loss for the year ended December 31, 2003 totaled $1,338,000, or $0.05 per
        share, compared to a net loss of $1,630,000, or $0.10 per share, for the
        year
        ended December 31, 2002. Interest income was higher in 2003 ($107,000 compared
        to $86,000 in 2002) as higher cash balances from funds received from convertible
        Notes and Private Placements were invested in short-term secure investments.
        The
        change in loss in 2003 was due to a number of factors. Management and consulting
        fees were higher in 2003 due to new personnel and the commencement of paying
        directors fees amounting to $49,000. In 2002 a greater number of stock options
        were granted resulting in stock option compensation expense amounting to
        $520,000 compared to $132,000 in the current year. Investor communications
        fees
        were reduced during 2003 at $171,000 compared to $234,000 in 2002. Professional
        fees were lower overall in 2003 at $136,000 compared to $163,000 in 2002
        with
        lower legal and consulting fees due to lesser number of project acquisitions.
        Debenture interest was reduced in 2003 at $12,000 compared to $122,000 in
        2002
        as the second convertible debenture was converted into common shares of the
        Company in April 2003. In 2002, the Company recorded an exploration expense
        of
        $189,000 in connection with the Pacific Intermountain Gold Inc. acquisition.
        In
        2003, the Company wrote off the Tobin Basin project in Nevada amounting to
        $342,000 due to unsuccessful exploration results.
 
 **Quarterly
        Information**
 Selected
        financial information for each of the last eight quarters ended December
        31,
        2005 is as follows (unaudited):
  4thQuarter EndedDecember 31, 2005
                3rdQuarter EndedSeptember 30, 2005
                2ndQuarter Ended
                  June
                    30, 2005
                1stQuarter Ended
                  March
                    31, 2005Revenue
                $             
                    Nil
                $             
                    Nil
                $             
                    Nil
                $           
                    NilIncome
                    (loss) forperiod
                $    (807,000)
                $    (389,000)
                $    (384,000)
                $    423,000Income
                    (loss) pershare
                $       
                       (0.03)
                $      
                       (0.01)
                $ 
                            (0.01)
                $          0.01
  4thQuarter EndedDecember 31, 2005
                  3rdQuarter EndedSeptember 30, 2005
                  2ndQuarter Ended
                    June
                      30, 2005
                  1stQuarter Ended
                    March
                      31, 2005Revenue
                  $             
                      Nil
                  $             
                      Nil
                  $             
                      Nil
                  $           
                      NilIncome
                      (loss) forperiod
                  $    (400,000)
                  $    (418,000)
                  $    (517,000)
                  $    109,000Loss
                        per share
                  $       
                         (0.01)
                  $     
                          (0.01)
                  $ 
                              (0.02)
                  $  
                                  
                      -
 The
        loss
        in the fourth quarter of 2005 was higher than previous quarters due to the
        stock
        option compensation expense for the two-tiered options which amounted to
        $332,000.
 
 The
        income for the first quarters in 2005 and 2004 was due to the recognition
        of the
        Company’s tax assets after renouncing the Canadian Exploration Expenses to the
        investors of the flow-through financings completed in 2003 and
        2004.
 
 **Mineral
        Interest Activities**
 During
        the year ended December 31, 2005, the Company incurred net expenditures of
        $3,397,000 on mineral interests compared to $4,364,000 in the year ended
        December 31, 2004. Of the expenditures incurred in the 2005 period, $2,181,000
        was expended at its Courageous Lake project and $758,000 on the Nevada
        properties. At Courageous Lake, 2005 activities included a diamond drill
        program
        and an independent Preliminary Economic Assessment (“PEA”). The drill program
        demonstrated the potential to
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  expand
        the strike length of the FAT (felsic-ash-tuff) deposit by approximately 850
        meters to the south and by approximately 600 meters to the north. The PEA
        demonstrated that the FAT deposit has the potential to be developed as a
        large,
        open pit operation at current gold prices. Additional exploration and
        engineering activities are planned at Courageous Lake for 2006. In Nevada,
        2005
        exploration activities included geologic mapping, rock and soil sampling
        and
        geophysical surveys at 12 of the Company’s Nevada projects. From this work, two
        were selected for drilling by Seabridge in 2006, the Golden Arrow project
        and
        Four-Mile Basin. The balance of expenditures on mineral interests during
        2005
        was related to project holding costs, including underlying lease payments
        and
        payments to government agencies for claim maintenance.
 
 During 2005,
        Falconbridge Limited (Seabridge's joint venture partner) completed
        a drill program at Kerr Sulphurets consisting of 16 widely-spaced core drill
        holes totaling 4,092 meters designed to test six targets situated outside
        the
        resources previously defined for the Kerr and Sulphurets deposits. Gold-copper
        mineralization was encountered at all six targets, with the Iron Cap and
        West
        Mitchell zones yielding the most encouraging results. Plans are in progress
        to
        undertake further drilling in the gold-rich areas in 2006.
 
 During
        2006, the Company plans to expend approximately $6.5 million on mineral
        interests. Approximately $5.1 million of these planned expenditures will
        be
        associated with Courageous Lake including a new 15,000-meter drill program
        designed to test the potential to increase the estimated mine life projected
        in
        the PEA. In addition, $1.0 million is planned for its Nevada projects including
        drill programs at Four-Mile Basin and Golden Arrow. The balance of planned
        mineral interest expenditures for 2006 will include ongoing holding costs
        at its
        projects as well as reconnaissance activities on a number of its earlier
        staged
        projects in Nevada.
 
 **Liquidity
        and Capital Resources**
 The
        ability of the Company to successfully acquire additional advanced-stage
        gold
        projects or to advance the projects already acquired is conditional on its
        ability to secure financing when required. The Company proposes to meet any
        additional cash requirements through equity financings. In light of the
        continually changing financial markets, there is no assurance that new funding
        will be available at the times required or desired by the Company.
  ***Year
        Ended December 31, 2005***
 The
        Company’s working capital position, at December 31, 2005, was $10,603,000 an
        increase of $6,383,000 compared to $4,220,000 at the prior year-end. Included
        in
        working capital, in 2005, was $4,028,000 (2004 - $1,170,000) in cash from
        flow-through share financings which will be used in 2006 for exploration
        at the
        Courageous Lake property. In 2005, the Company completed two flow-through
        financings, in February 500,000 common shares were issued at $4.25 each and
        in
        December 435,000 common shares were issued at $7.25 each. In addition, a
        private
        placement of 1 million shares at $5 each was completed with the Company’s
        largest shareholder. Also in 2005, the Company received cash of $863,000
        from
        the exercise of warrants and $361,000 from the exercise of options. In 2005,
        total financings received were $11,299,000 compared to $8,241,000 in 2004.
 
 C ash
        and
        short-term deposits at December 31, 2005 were $6,165,000, up from $2,788,000
        at
        December 31, 2004. In addition to
        the
        stated cash and short-term deposits, the Company had $4,028,000 in cash from
        flow-through share financings which will be used in 2006 for exploration
        at the
        Courageous Lake property. Operations activities used $1,220,000 in 2005 compared to $1,764,000 in the
        prior year due to increased corporate activities in 2004 including listing
        the
        Company on the American Stock Exchange. Cash expenditures on Mineral Interests
        including the capital assets were $3,843,000 comparable to the $6,714,000
        cash
        expenditures in 2004.
 **Contractual
          Obligations**
 ($,000)
                
                
                Payments
                    due by periodTotal
                2006
                2007-9
                20010-11
                After
                    2011Mineral
                    interests
                
                9,270
                1,195
                3,969
                2,738
                1,372Reclamation
                    liabilities
                
                1,407
                -
                -
                -
                1,40710,677
                1,195
                3,969
                2,738
                2,779
 Amounts
        shown for mineral interests include option payments and mineral lease payments
        that are required to maintain the Company’s interest in the mineral
        projects.
  97
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  **Outlook**
 During
        2006, the Company will continue to make exploration expenditures to advance
        its
        major project being Courageous Lake, undertake two drilling programs in Nevada
        and to review its other projects for possible joint venture opportunities
        while
        at the same time ensuring that funding is available for its project holding
        costs and other corporate requirements. The company presently has sufficient
        funds on hand to complete all activities on current projects through
        2006.
 
 **Disclosure
        Controls and Procedures**
 Disclosure
        controls and procedures are designed to provide reasonable assurance that
        all
        relevant information is gathered and reported to senior management, including
        the Chief Executive Officer (CEO) and the Chief Financial Officer (CFO),
        on a
        timely basis so that appropriate decisions can be made regarding public
        disclosure. As at December 31, 2005, the Company's management, with the
        participation of the CEO and CFO, has evaluated the effectiveness of the
        Company's disclosure controls and procedures as defined in Multilateral
        Instrument 52-109 of the Canadian Securities Administrators and has concluded
        that such controls and procedures are effective.
 
 **Shares
        Issued and Outstanding**
 At
        March
        14, 2006, the issued and outstanding common shares of the Company totaled
        32,211,685. In addition, there are 2,649,500 stock options granted (of which
        1,155,000 are unexercisable and are contingent upon achieving certain future
        goals). On a fully diluted basis there would be 34,861,185 common shares
        issued
        and outstanding.
 
 **Related
        Party Transactions**
 During
        the year ended December 31, 2005; a private company controlled by a director
        of
        the Company was paid $39,000 (2004 - $57,000) for technical services provided
        by
        his company related to mineral properties; a private company controlled by
        a
        second director was paid $120,000 (2004 - $133,000) for corporate consulting
        services rendered; and outstanding accounts payable to directors was $30,000.
        These transactions were in the normal course of operations and were measured
        at
        the exchange amount, which is the amount of consideration established and
        agreed
        to by the related parties.
 
 **Risks
        and Uncertainties**
 ***Exploration
        and Development Risks*** ******
 The
        business of exploring for minerals involves a high degree of risk. Attracting
        and maintaining educated and knowledgeable technical personnel may be difficult
        at times. Few properties that are explored are ultimately developed into
        producing mines. At present, none of the Company’s properties have a known body
        of commercial ore. The mineral resource estimates set out herein are not
        mineral
        reserves and do not have demonstrated economic viability. Major expenses
        may be
        required to establish ore reserves, to develop metallurgical processes and
        to
        construct mining and processing facilities at a particular site. It is
        impossible to ensure that the current exploration programs planned by the
        Company will result in a profitable commercial mining operation.
 
 ***Financing
        Risks***
 The
        Company has limited financial resources, has no operating cash flow and has
        no
        assurance that sufficient funding will be available to it for further
        exploration and development of its projects or to fulfill its obligations
        under
        any applicable agreements. There can be no assurance that the Company will
        be
        able to obtain adequate financing in the future or that the terms of such
        financing will be favourable. Failure to obtain such additional financing
        could
        result in delay or indefinite postponement of further exploration and
        development of its projects with the possible forced sale or loss of such
        properties. The Company will require additional financing if ongoing exploration
        of its properties is warranted.
 
 ***Mineral
        Interests***
 Mineral
        interests represent the capitalized expenditures related to the exploration
        and
        development of mineral properties. Upon commencement of commercial production,
        all related capital expenditures for any given mining interest are amortized
        over the estimated economic life of the property. If a property is abandoned
        or
        deemed economically unfeasible, the related project balances are written
        off.
  98
 Table
            of Contents
  **Critical
        Accounting Estimates**
 Critical
        accounting estimates used in the preparation of the consolidated financial
        statements include the Company’s estimate of recoverable value of its mineral
        properties and related deferred exploration expenditures as well as the value
        of
        stock-based compensation. Both of these estimates involve considerable judgment
        and are, or could be, affected by significant factors that are out of the
        Company’s control.
 
 The
        factors affecting stock-based compensation include estimates of when stock
        options and compensation warrants might be exercised and the stock price
        volatility. The timing for exercise of options is out of the Company’s control
        and will depend upon a variety of factors, including the market value of
        the
        Company’s shares and financial objectives of the stock-based instrument holders.
        The Company used historical data to determine volatility in accordance with
        the
        Black-Scholes model. However, the future volatility is uncertain and the
        model
        has its limitations.
 
 The
        Company’s recoverability of its recorded value of its mineral properties and
        associated deferred exploration expenses is based on market conditions for
        minerals, underlying mineral resources associated with the properties and
        future
        costs that may be required for ultimate realization through mining operations
        or
        by sale. The Company is in an industry that is dependent on a number of factors
        including environmental, legal and political risks, the existence of
        economically recoverable reserves, the ability of the Company and its
        subsidiaries to obtain necessary financing to complete the development, and
        future profitable production or the proceeds of disposition
        thereof.
 
 **Forward
        Looking Statements**
 These
        consolidated financial statements and management’s discussion and analysis
        contain certain forward-looking statements relating but not limited to the
        Company’s expectations, intentions, plans and beliefs. Forward-looking
        information can often be identified by forward-looking words such as
“anticipate”, “believe”, “expect”, “goal”, “plan”, “intend”, “estimate”, “may”
and “will” or similar words suggesting future outcomes, or other expectations,
        beliefs, plans, objectives, assumptions, intentions or statements about future
        events or performance. Forward-looking information may include reserve and
        resource estimates, estimates of future production, unit costs, costs of
        capital
        projects and timing of commencement of operations, and is based on current
        expectations that involve a number of business risks and uncertainties. Factors
        that could cause actual results to differ materially from any forward-looking
        statement include, but are not limited to, failure to establish estimated
        resources and reserves, the grade and recovery of ore which is mined varying
        from estimates, capital and operating costs varying significantly from
        estimates, delays in obtaining or failures to obtain required governmental,
        environmental or other project approvals, inflation, changes in exchange
        rates,
        fluctuations in commodity prices, delays in the development of projects and
        other factors. Forward-looking statements are subject to risks, uncertainties
        and other factors that could cause actual results to differ materially from
        expected results.
 
 Potential
        shareholders and prospective investors should be aware that these statements
        are
        subject to known and unknown risks, uncertainties and other factors that
        could
        cause actual results to differ materially from those suggested by the
        forward-looking statements. Shareholders are cautioned not to place undue
        reliance on forward-looking information. By its nature, forward-looking
        information involves numerous assumptions, inherent risks and uncertainties,
        both general and specific, that contribute to the possibility that the
        predictions, forecasts, projections and various future events will not occur.
        The Company undertakes no obligation to update publicly or otherwise revise
        any
        forward-looking information whether as a result of new information, future
        events or other such factors which affect this information, except as required
        by law.
  99
 Table
            of Contents
  **Management’s
        Report**
 The
        management of Seabridge Gold Inc.  is
        responsible for the preparation of the consolidated financial statements
        as well
        as the financial and other information contained in the annual report, annual
        information form and form 20-F. Management maintains an internal control
        system
        in order to provide reasonable assurance as to the reliability of financial
        information and the safeguarding of assets.
 
 The
        consolidated financial statements are prepared in accordance with generally
        accepted accounting principles in Canada and necessarily include amounts
        determined in accordance with estimates and judgments made by management.
        KPMG
        LLP, the external auditors, express their opinion on the consolidated financial
        statements in the annual report.
 
 The
        Board
        of Directors, through the Audit Committee, is responsible for ensuring that
        management fulfills its responsibilities for financial reporting and internal
        control.
 
 The
        consolidated financial statements of the Company have been approved by the
        Board
        of Directors.
 /s/
        Rudi
        P. Fronk
  Rudi
        P.
        Fronk
 President
        & CEO
 March
        14,
        2006
   
 **Auditors'
        Report to the Shareholders**
 We
        have
        audited the consolidated **** balance
        sheets of Seabridge Gold Inc. as at December 31, 2005 **** and
        2004
        the consolidated **** statements
        of operations and deficit and cash flows for each of the years in the three-year
        period ended December 31, 2005. These consolidated financial statements are
        the
        responsibility of the Company's management. Our responsibility is to express
        an
        opinion on these consolidated financial statements based on our audits.
  We
        conducted our audits in accordance with Canadian generally accepted auditing
        standards and the standards of the Public Company Accounting Oversight Board
        (United States). Those standards require that we plan and perform an audit
        to
        obtain reasonable assurance whether the financial statements are free of
        material misstatement. An audit includes examining, on a test basis, evidence
        supporting the amounts and disclosures in the financial statements. An audit
        also includes assessing the accounting principles used and significant estimates
        made by management, as well as evaluating the overall financial statement
        presentation.
  In
        our
        opinion, these consolidated financial statements present fairly, in all material
        respects, the financial position of the Company as at December 31, 2005 and
        2004
        and the results of its operations and its cash flows for each of the years
        in
        the three year period then ended in accordance with Canadian generally accepted
        accounting principles.
  Canadian
        generally accepted accounting principles vary in certain significant respects
        from accounting principles generally accepted in the United States of America.
        Information relating to the nature and effect of such differences is presented
        in Note 11 to the consolidated financial statements.
  /s/
        KPMG
        LLP
  Chartered
        Accountants
 Toronto,
        Canada
 March
        14,
        2006
  100
 Table
            of Contents
  **Consolidated
                  Balance Sheets**
                  **December
                    3, 2005 and 2004**
                  **(in
                    Canadian dollars)****2005**
                
                **2004****ASSETS**CURRENT
                    ASSETSCash
                    and cash equivalents
                
                **$**
                **293,107**
                
                $
                157,502Cash
                    held for exploration expenditures (Note 6)
                
                
                **4,028,247**
                
                
                1,169,798Short-term
                    deposits
                
                
                **5,871,753**
                
                
                2,630,202Amounts
                    receivable and prepaid expenses
                
                
                **543,123**
                
                
                278,815Marketable
                    securities
                
                
                **160,101**
                
                
                160,101**10,896,331**
                
                
                4,396,418MINERAL
                    INTERESTS (Note 3)
                
                
                **24,395,438**
                
                
                20,998,671INVESTMENT
                    (Note 3(c))
                
                
                **749,450**
                
                
                749,450RECLAMATION
                    DEPOSITS (Note 4)
                
                
                **1,000,000**
                
                
                1,000,000CAPITAL
                    ASSETS
                
                
                **43,510**
                
                
                27,819**$**
                **37,084,729**
                
                $
                27,172,358**LIABILITIES**CURRENT
                    LIABILITIESAccounts
                    payable and accruals
                
                **$**
                **293,120**
                
                $
                176,354PROVISIONS
                    FOR RECLAMATION LIABILITIES (Note 4)
                
                
                **1,406,734**
                
                
                1,293,449**1,699,854**
                
                
                1,469,803**SHAREHOLDERS’ EQUITY**(Note
                    6)SHARE
                    CAPITAL
                
                
                **52,914,945**
                
                
                42,230,336STOCK
                    OPTIONS
                
                
                **959,543**
                
                
                703,926SHARE
                    PURCHASE WARRANTS
                
                
                **-**
                
                
                100,625CONTRIBUTED
                    SURPLUS
                
                
                **19,500**
                
                
                19,500DEFICIT
                
                
                **(18,509,113**
                **)**
                
                (17,351,832
                )**35,384,875**
                
                
                25,702,555COMMITMENTS
                    (Note 3 and 6(a))
                  SUBSEQUENT
                    EVENTS (Notes 10)
                
                **$**
                **37,084,729**
                
                $
                27,172,358
 See
        accompanying notes to consolidated financial statements
  ON BEHALF OF THE BOARD OF DIRECTORS
  /s/
                Rudi P. Fronk
              /s/
                James S. AnthonyRudi
                P. Fronk
              James
                S. AnthonyDirector
              Director
  101
 Table
            of Contents
  **Consolidated
                  Statements of Operations and Deficit**
                **For
                  the Years Ended December 31, 2005, 2004 and 2003**
                **(in
                  Canadian dollars)****2005**
              
              
              **2004**
              
              
              **2003**EXPENDITURESCorporate
                  and general expenses
              **$**
              **1,739,441**
              
              $
              1,829,054
              
              $
              962,315Stock
                  option compensation (Note 6(b))
              
              **361,350**
              
              
              114,735
              
              
              131,571**2,100,791**
              
              
              1,943,789
              
              
              1,093,886Interest
                  income
              
              **(134,677**
              **)**
              
              (82,763
              )
              
              (107,165
              )Gain
                  on sale of marketable securities
              
              -
              
              
              (74,900
              )
              
              -Foreign
                  exchange losses (gains)
              
              **11,967**
              
              
              (3,563
              )
              
              (2,787
              )Interest
                  expense - debentures
              
              **-**
              
              
              -
              
              
              12,187Minority
                  interest
              
              **-**
              
              
              18,725
              
              
              -Write-off
                  of mineral properties (Note 3)
              
              **-**
              
              
              -
              
              
              342,151LOSS
                  BEFORE INCOME TAXES
              
              **1,978,081**
              
              
              1,801,288
              
              
              1,338,272Income
                  tax recoveries (Note 6(a)(ii))
              
              **(820,800**
              **)**
              
              (575,000
              )
              
              -NET
                  LOSS FOR YEAR
              
              **1,157,281**
              
              
              1,226,288
              
              
              1,338,272DEFICIT,
                  BEGINNING OF YEAR
              
              **17,351,832**
              
              
              16,125,544
              
              
              14,787,272DEFICIT,
                  END OF YEAR
              **$**
              **18,509,113**
              
              $
              17,351,832
              
              $
              16,125,544LOSS
                  PER SHARE - basic and diluted
              **$**
              **0.04**
              
              $
              0.04
              
              $
              0.05WEIGHTED
                  AVERAGE NUMBER OF SHARES OUTSTANDING
              
              **30,682,026**
              
              
              28,876,451
              
              
              26,190,960
 
 See
          accompanying notes to consolidated financial statements
  102
 Table
            of Contents
  **Consolidated
                    Statements of Cash Flows**
                  **For
                    the Years Ended December 31, 2005, 2004 and 2003**
                  **(in
                    Canadian dollars)****2005**
                
                **2004**
                
                **2003**CASH
                    PROVIDED FROM (USED FOR) OPERATIONSNet
                    loss for year
                **$**
                **(1,157,281**
                **)**
                $
                (1,226,288
                )
                $
                (1,338,272
                )Items
                    not involving cashStock
                    option compensation
                
                **361,350**
                
                
                114,735
                
                
                131,571Minority
                    interest
                
                **-**
                
                
                18,725
                
                
                -Other
                
                **113,285**
                
                
                104,160
                
                
                12,187Amortization
                
                **7,215**
                
                
                4,339
                
                
                2,941Write-off
                    of mineral properties
                
                **-**
                
                
                -
                
                
                342,151Income
                    tax recoveries
                
                **(820,800**
                **)**
                
                (580,800
                )
                
                -Changes
                    in non-cash working capital itemsAmounts
                    receivable and prepaid expenses
                
                **83,707**
                
                
                (109,911
                )
                
                (45,395
                )Accounts
                    payable and accruals
                
                **192,037**
                
                
                (89,305
                )
                
                78,611**(1,220,487**
                **)**
                
                (1,764,345
                )
                
                (816,206
                )INVESTING
                    ACTIVITIESMineral
                    interests
                
                **(3,815,625**
                **)**
                
                (6,714,026
                )
                
                (5,522,671
                )Short-term
                    deposits
                
                **(3,241,551**
                **)**
                
                (1,739,302
                )
                
                1,852,530Investment
                    in exploration company (Note 3(b))
                
                -
                
                
                -
                
                
                (749,450
                )Reclamation
                    deposits
                
                -
                
                
                225,000
                
                
                -Capital
                    assets
                
                **(27,334**
                **)**
                
                -
                
                
                (32,722
                )**(7,084,510**
                **)**
                
                (8,228,328
                )
                
                (4,452,313
                )FINANCING
                    ACTIVITIESIssue
                    of share capital and warrants
                
                **11,299,051**
                
                
                8,241,374
                
                
                7,467,020NET
                    CASH PROVIDED (USED)
                
                **2,994,054**
                
                
                (1,751,299
                )
                
                2,198,501CASH
                    AND CASH EQUIVALENTS, BEGINNING OF YEAR
                
                **1,327,300**
                
                
                3,078,599
                
                
                880,098CASH
                    AND CASH EQUIVALENTS, END OF YEAR
                **$**
                **4,321,354**
                
                $
                1,327,300
                
                $
                3,078,599CASH
                    AND CASH EQUIVALENTS, END OF YEAR:Cash
                    and cash equivalents
                **$**
                **293,107**
                
                $
                157,502
                
                $
                1,551,999Cash
                    held for exploration expenditures
                
                **4,028,247**
                
                
                1,169,798
                
                
                1,526,600**$**
                **4,321,354**
                
                $
                1,327,300
                
                $
                3,078,599
  See
      accompanying notes to consolidated
      financial statements  103
 Table
            of Contents
  **Notes
        to the Financial Statements**
 **December
        31, 2005 and 2004**
 **(in
        Canadian dollars, except where noted)**
 
  **1.**
                **NATURE
                    OF OPERATIONS**
 The
          Company is engaged in the acquisition, exploration and development of mineral
          properties. To date, the Company has not earned significant revenues and
          is
          considered to be in the exploration stage. The ability of the Company to
          carry
          out its business plan rests with its ability to secure equity and other
          financings and develop the properties.
 
 **2.**
                **SUMMARY
                    OF SIGNIFICANT ACCOUNTING
                    POLICIES**
 The
          consolidated financial statements of the Company have been prepared in
          accordance with generally accepted accounting principles in Canada. (“GAAP”)
          which, except as noted in Note 11, are consistent in all material respects
          with
          generally accepted accounting principles in the United States of America.
 
 The
          consolidated financial statements have, in management’s opinion, been properly
          prepared within reasonable limits of materiality and within the framework
          of the
          significant accounting policies summarized below:
  a) **Principles
          of Consolidation**
 These
          consolidated financial statements include the accounts of Seabridge Gold
          Inc.
          and its wholly-owned subsidiaries, Seabridge Gold Corp., a company incorporated
          under the laws of the State of Nevada, USA, 5073 N.W.T. Limited, a company
          incorporated under the laws of the Northwest Territories of Canada; and
          Pacific
          Intermountain Gold Inc. (“PIGCO”), a company incorporated under the laws of the
          State of Nevada, USA. Prior to July 2004, PIGCO was 75% owned. All significant
          inter-company transactions and balances have been eliminated.
 
 b)  **Mineral
          Interests**
 Direct
          property acquisition costs, advance royalties, holding costs, field exploration
          and field supervisory costs relating to specific properties are deferred
          until
          the properties are brought into production, at which time, they will be
          amortized on a unit of production basis, or until the properties are abandoned,
          sold or considered to be impaired in value, at which time an appropriate
          charge
          will be made. The recovery of costs of mining claims and deferred exploration
          is
          dependent upon the existence of economically recoverable reserves, the
          ability
          of the Company to obtain the necessary financing to complete exploration
          and
          development and future profitable production or proceeds from disposition
          of
          such properties.
 
 The
          Emerging Issues Committee of the CICA issued EIC-126 - “Accounting by Mining
          Enterprises for Exploration Costs” which interprets how Accounting Guideline No.
          11 entitled Enterprises in the Development Stage - (AcG 11) affects mining
          companies with respect to the deferral of exploration costs. EIC-126 refers
          to
          CICA Handbook Section 3061 "Property, Plant and Equipment", paragraph .21,
          which
          states that for a mining property, the cost of the asset includes exploration
          costs if the enterprise considers that such costs have the characteristics
          of
          property, plant and equipment. EIC-126 then states that a mining enterprise
          that
          has not established mineral reserves objectively, and therefore does not
          have a
          basis for preparing a projection of the estimated cash flow from the property,
          is not precluded from considering the exploration costs to have the
          characteristics of property, plant and equipment. EIC-126 also sets forth
          the
          Committee’s consensus that a mining enterprise in the development stage is not
          required to consider the conditions in AcG-11 regarding impairment in
          determining whether exploration costs may be initially capitalized. With
          respect
          to impairment of capitalized exploration costs, EIC-126 sets forth the
          Committee’s consensus that a mining enterprise in the development stage that has
          not established mineral reserves objectively, and therefore does not have
          a
          basis for preparing a projection of the estimated cash flow from the property
          is
          not obliged to conclude that capitalized costs have been impaired. However,
          such
          an enterprise should consider the conditions set forth in AcG-11 and CICA
          Handbook sections relating to long-lived assets in determining whether
          subsequent write-down of capitalized exploration costs related to mining
          properties is required. Any resulting write-downs are charged to the statement
          of operations.
 
 The
          Company considers that exploration costs have the characteristics of property,
          plant and equipment, and, accordingly, defers such costs. Furthermore,
          pursuant
          to EIC-126, deferred exploration costs would not automatically be subject
          to
          regular assessment of recoverability, unless conditions, such as those
          discussed
          in AcG 11 exist.
  AcG
          11
          also provides guidance on measuring impairment of when pre-operating costs
          have
          been deferred. While this guidance is applicable, its application did not
          result
          in impairment, except for those noted in Note 3.
 
 c) **Asset
          Retirement Obligations**
 The
          Company recognizes the fair value of liabilities for asset retirement
          obligations in the period in which they occur and/or in which a reasonable
          estimate of such costs can be made (Note 4).
 
 d) **Stock-based
          Compensation**
 The
          Company applies the fair value method for stock-based compensation and
          other
          stock-based payments. Options are valued using the Black Scholes option-pricing
          model. The resulting value is charged against income over the anticipated
          vesting period of the option (see Note 6(b)).
 
 e) **Capital
          Assets**
 Capital
          assets are carried at cost less accumulated amortization. Amortization
          is
          provided using the straight-line method at an annual rate of 20% from the
          date
          of acquisition.
 
 104
 Table
              of Contents
 
 f )******** **Cash
          and Short-term Deposits**
 Cash
          and
          short-term investments consist of balances with banks and investments in
          money
          market instruments. These investments are carried at cost, which approximates
          market. Cash and cash equivalents consist of investments with maturities
          of up
          to 90 days at the date of purchase. Short-term deposits consist of investments
          with maturities greater than 90 days at the date of purchase.
 
 g) **Marketable
          Securities**
 Short-term
          investments in marketable securities are recorded at the lower of cost
          or market
          value. The market values of investments are determined based on the closing
          prices reported on recognized securities exchanges and over-the-counter
          markets.
          Such individual market values do not necessarily represent the realizable
          value
          of the total holding of any security, which may be more or less than that
          indicated by market quotations. When there has been a loss in the value
          of an
          investment in marketable securities that is determined to be other than
          a
          temporary decline, the investment is written down to recognize the loss.
          The
          securities are valued at cost. The market value of the marketable securities
          holdings at December 31, 2005 approximates cost.
 
 h) **Investments**
 Investments
          in companies where the Company does not have significant influence are
          carried
          at cost less any allowance for other than temporary impairment.
 
 i)  **Flow-through
          Shares**
 The
          Company financed a portion of its exploration and development activities
          through
          the issue of flow-through shares. Under the terms of these share issues,
          the tax
          attributes of the related expenditures are renounced to subscribers. When
          the
          renunciation is made, the tax value of the renunciation is recorded as
          a
          liability and charged against share capital Where the Company has a valuation
          allowance, which reduces future income tax assets, the valuation allowance
          is
          reduced and an income tax recovery is recorded in the statement of
          operations.
  j)  **Translation
          of Foreign Currencies**
 The
          functional currency of the Company and its subsidiaries is considered to
          be the
          Canadian dollar. Foreign currency transactions entered into by the Company
          and
          financial statements of integrated foreign operations are translated using
          the
          temporal method. Under this method, monetary assets and liabilities are
          translated at year-end rates of exchange, non-monetary assets and liabilities
          are translated at historic rates of exchange and statement of operations
          items
          are translated at average exchange rates prevailing during the year. Exchange
          gains and losses on foreign currency transactions and foreign currency
          denominated balances are included in the statement of operations in the
          current
          year.
 
 k) **Income
          Taxes**
 The
          Company accounts for income taxes using the asset and liability method.
          Under
          this method of tax allocation, future income tax assets and liabilities
          are
          determined based on differences between the financial statement carrying
          values
          and their respective income tax bases (temporary differences). Future income
          tax
          assets and liabilities are measured using the tax rates expected to be
          in effect
          when the temporary differences are likely to reverse. The effect on future
          income tax assets and liabilities of a change in tax rates enacted is included
          in operations in the period in which the change is enacted or substantively
          enacted. The amount of future income tax assets recognized is limited to
          the
          amount that is more likely than not to be realized.
 
 l) **Loss
          Per Share**
 Loss
          per
          share of common stock is computed based on the weighted average number
          of common
          shares outstanding during the year. The Company uses the treasury stock
          method
          for calculating diluted loss per share. As the Company incurred net losses
          for
          the year ended December 31, 2005 and 2004, all outstanding options have
          been
          excluded from the calculation of diluted loss per share.
 
 m)  **Use
          of Estimates**
 The
          preparation of financial statements in conformity with generally accepted
          accounting principles requires management to make estimates and assumptions
          that
          affect the reported amounts of assets and liabilities and disclosure of
          contingent assets and liabilities at the date of the financial statements
          and
          the reported amounts of revenue and expenses during the reported year.
          The most
          significant estimates relate to the carrying values of exploration properties,
          amortization rates, accrued liabilities and contingencies and calculations
          of
          future income tax assets. Actual results could be materially different
          from
          those estimates.
  105
 Table
            of Contents
  **3.**
              **MINERAL
                  INTERESTS** Expenditures
          made on account of mineral interests by the Company were as follows:
 **2005****Property
                    and Expense**
                  
                  
                  **Balance,
                    December 31, 2004**
                  
                  
                  **Expenditures**
                  
                  
                  **Recoveries/Write-offs**
                  
                  
                  **Balance
                    December 31, 2005****Courageous
                      Lake**Acquisition
                      costs
                  
                  $
                  8,202,305
                  
                  $
                  50,000
                  
                  $
                  -
                  
                  $
                  8,252,305Deferred
                      exploration
                  
                  
                  5,388,752
                  
                  
                  2,130,736
                  
                  
                  -
                  
                  
                  7,519,488**13.591,057**
                  
                  
                  **2,180,736**
                  
                  
                  **-**
                  
                  
                  **15,771,793****Castle
                      Black Rock**Acquisition
                      costs
                  
                  
                  140,426
                  
                  
                  -
                  
                  
                  -
                  
                  
                  140,426Deferred
                      exploration
                  
                  
                  194,214
                  
                  
                  49,428
                  
                  
                  -
                  
                  
                  243,642**334,640**
                  
                  
                  **49,428**
                  
                  
                  **-**
                  
                  
                  **384,068****Grassy
                      Mountain**Acquisition
                      costs
                  
                  
                  2,261,299
                  
                  
                  -
                  
                  
                  -
                  
                  
                  2,261,299Deferred
                      exploration
                  
                  
                  708,837
                  
                  
                  135,711
                  
                  
                  -
                  
                  
                  844,548**2,970,136**
                  
                  
                  **135,711**
                  
                  
                  **-**
                  
                  
                  **3,105,847****Hog
                      Ranch**Acquisition
                      costs
                  
                  
                  443,838
                  
                  
                  -
                  
                  
                  -
                  
                  
                  443,838Deferred
                      exploration
                  
                  
                  563,897
                  
                  
                  65,953
                  
                  
                  -
                  
                  
                  629,850**1,007,735**
                  
                  
                  **65,953**
                  
                  
                  **-**
                  
                  
                  **1,073,688****Kerr-Sulphurets**Acquisition
                      costs
                  
                  
                  465,542
                  
                  
                  -
                  
                  
                  -
                  
                  
                  465,542Deferred
                      exploration
                  
                  
                  59,177
                  
                  
                  2,205
                  
                  
                  -
                  
                  
                  61,382**524,719**
                  
                  
                  **2,205**
                  
                  
                  **-**
                  
                  
                  **526,924****Quartz
                      Mountain**Acquisition
                      costs
                  
                  
                  357,139
                  
                  
                  -
                  
                  
                  -
                  
                  
                  357,139Deferred
                      exploration
                  
                  
                  85,348
                  
                  
                  -
                  
                  
                  -
                  
                  
                  85,348**442,487**
                  
                  
                  **-**
                  
                  
                  **-**
                  
                  
                  **442,487****Red
                      Mountain**Acquisition
                      costs
                  
                  
                  82,090
                  
                  
                  -
                  
                  
                  -
                  
                  
                  82,090Deferred
                      exploration
                  
                  
                  534,866
                  
                  
                  155,854
                  
                  
                  -
                  
                  
                  690,720**616,956**
                  
                  
                  **155,854**
                  
                  
                  **-**
                  
                  
                  **772,810****Pacific
                      Intermountain Gold Inc.**Acquisition
                      costs
                  
                  
                  48,215
                  
                  
                  -
                  
                  
                  (33,355
                  )
                  
                  14,860Deferred
                      exploration
                  
                  
                  1,303,058
                  
                  
                  757,586
                  
                  
                  -
                  
                  
                  2,060,644**1,351,273**
                  
                  
                  **757,586**
                  
                  
                  **(33,355**
                  **)**
                  
                  **2,075,504****Other
                      Nevada Projects**Acquisition
                      costs.
                  
                  
                  20,000
                  
                  
                  28,901
                  
                  
                  -
                  
                  
                  48,901Deferred
                      exploration
                  
                  
                  139,668
                  
                  
                  53,748
                  
                  
                  -
                  
                  
                  193,416**159,668**
                  
                  
                  **82,649**
                  
                  
                  **-**
                  
                  
                  **242,317****Total**Acquisition
                      costs
                  
                  
                  12,020,854
                  
                  
                  78,901
                  
                  
                  (33,355
                  )
                  
                  12,066,400Deferred
                      exploration
                  
                  
                  8,977,817
                  
                  
                  3,351,221
                  
                  
                  -
                  
                  
                  12,329,038**Total
                      Mineral Interests**
                  
                  **$**
                  **20,998,671**
                  
                  **$**
                  **3,430,122**
                  
                  **$**
                  **(33,355**
                  **)**
                  **$**
                  **24,395,438**
  106
 Table
            of Contents
 **2004****Property
                and Expense**
              
              
              **Balance,
                December 31, 2003**
              
              
              **Expenditures**
              
              
              **Recoveries/Write-offs**
              
              
              **Balance
                December 31, 2004**
 **Castle
                    Black Rock**Acquisition
                    costs
                
                $
                140,426
                
                $
                -
                
                $
                -
                
                $
                140,426Deferred
                    exploration
                
                
                137,141
                
                
                57,073
                
                
                -
                
                
                194,214**277,567**
                
                
                **57,073**
                
                
                **-**
                
                
                **334,640****Grassy
                    Mountain**Acquisition
                    costs
                
                
                2,261,299
                
                
                -
                
                
                -
                
                
                2,261,299Deferred
                    exploration
                
                
                490,785
                
                
                218,052
                
                
                -
                
                
                708,837**2,752,084**
                
                
                **218,052**
                
                
                **-**
                
                
                **2,970,136****Hog
                    Ranch**Acquisition
                    costs
                
                
                488,838
                
                
                -
                
                
                (45,000
                )
                
                443,838Deferred
                    exploration
                
                
                563,220
                
                
                677
                
                
                -
                
                
                563,897**1,052,058**
                
                
                **677**
                
                
                **(45,000**
                **)**
                
                **1,007,735****Kerr-Sulphurets**Acquisition
                    costs
                
                
                465,542
                
                
                -
                
                
                -
                
                
                465,542Deferred
                    exploration
                
                
                58,673
                
                
                504
                
                
                -
                
                
                59,177**524,215**
                
                
                **504**
                
                
                **-**
                
                
                **524,719****Quartz
                    Mountain**Acquisition
                    costs
                
                
                357,139
                
                
                -
                
                
                -
                
                
                357,139Deferred
                    exploration
                
                
                85,348
                
                
                -
                
                
                -
                
                
                85,348**442,487**
                
                
                **-**
                
                
                **-**
                
                
                **442,487****Red
                    Mountain**Acquisition
                    costs
                
                
                82,090
                
                
                -
                
                
                -
                
                
                82,090Deferred
                    exploration
                
                
                344,691
                
                
                190,175
                
                
                -
                
                
                534,866**426,781**
                
                
                **190,175**
                
                
                **-**
                
                
                **616,956****Courageous
                    Lake**Acquisition
                    costs
                
                
                8,152,305
                
                
                50,000
                
                
                -
                
                
                8,202,305Deferred
                    exploration
                
                
                1,708,693
                
                
                3,680,059
                
                
                -
                
                
                5,388,752**9,860,998**
                
                
                **3,730,059**
                
                
                **-**
                
                
                **13,591,057****Pacific
                    Intermountain Gold Inc.**Acquisition
                    costs
                
                
                137,461
                
                
                -
                
                
                (89,246
                )
                
                48,215Deferred
                    exploration
                
                
                1,049,893
                
                
                460,534
                
                
                (207,369
                )
                
                1,303,058**1,187,354**
                
                
                **460,534**
                
                
                **(296,615**
                **)**
                
                **1,351,273****Other
                    Nevada Projects**Acquisition
                    costs.
                
                
                20,000
                
                
                -
                
                
                -
                
                
                20,000Deferred
                    exploration
                
                
                91,329
                
                
                48,339
                
                
                -
                
                
                139,668**111,329**
                
                
                **48,339**
                
                
                **-**
                
                
                **159,668****Total**Acquisition
                    costs
                
                
                12,105,100
                
                
                50,000
                
                
                (134,246
                )
                
                12,020,854Deferred
                    exploration
                
                
                4,529,773
                
                
                4,655,413
                
                
                (207,369
                )
                
                8,977,817**Total
                    Mineral Interests**
                
                **$**
                **16,634,873**
                ****
                **$**
                **4,705,413**
                ****
                **$**
                **(341,615**
                **)**
                **$**
                **20,998,671**
  107
 Table
            of Contents
  **2003****Property
                and Expense**
              
              
              **Balance,
                December 31, 2002**
              
              
              **Expenditures**
              
              
              **Recoveries/Write-offs**
              
              
              **Balance
                December 31, 2003**
 **Castle
                  Black Rock**Acquisition
                  costs
              
              $
              140,426
              
              $
              -
              
              $
              -
              
              $
              140,426Deferred
                  exploration
              
              
              101,910
              
              
              35,231
              
              
              -
              
              
              137,141**242,336**
              
              
              **35,231**
              
              
              **-**
              
              
              **277,567****Grassy
                  Mountain**Acquisition
                  costs
              
              
              1,172,670
              
              
              1,088,629
              
              
              -
              
              
              2,261,299Deferred
                  exploration
              
              
              363,268
              
              
              127,517
              
              
              -
              
              
              490,785**1,535,938**
              
              
              **1,216,146**
              
              
              **-**
              
              
              **2,752,084****Hog
                  Ranch**Acquisition
                  costs
              
              
              540,838
              
              
              -
              
              
              (52,000
              )
              
              488,838Deferred
                  exploration
              
              
              553,581
              
              
              9,639
              
              
              -
              
              
              563,220**1,094,419**
              
              
              **9,639**
              
              
              **(52,000**
              **)**
              
              **1,052,058****Kerr-Sulphurets**Acquisition
                  costs
              
              
              465,542
              
              
              -
              
              
              -
              
              
              465,542Deferred
                  exploration
              
              
              43,673
              
              
              15,000
              
              
              -
              
              
              58,673**509,215**
              
              
              **15,000**
              
              
              **-**
              
              
              **524,215****Quartz
                  Mountain**Acquisition
                  costs
              
              
              370,239
              
              
              -
              
              
              (13,100
              )
              
              357,139Deferred
                  exploration
              
              
              82,732
              
              
              2,616
              
              
              -
              
              
              85,348**452,971**
              
              
              **2,616**
              
              
              **(13,100**
              **)**
              
              **442,487****Red
                  Mountain**Acquisition
                  costs
              
              
              82,090
              
              
              -
              
              
              -
              
              
              82,090Deferred
                  exploration
              
              
              76,431
              
              
              268,260
              
              
              -
              
              
              344,691**158,521**
              
              
              **268,260**
              
              
              **-**
              
              
              **426,781****Courageous
                  Lake**Acquisition
                  costs
              
              
              3,949,457
              
              
              4,202,848
              
              
              -
              
              
              8,152,305Deferred
                  exploration
              
              
              141,251
              
              
              1,567,442
              
              
              -
              
              
              1,708,693**4,090,708**
              
              
              **5,770,290**
              
              
              **-**
              
              
              **9,860,998****Pacific
                  Intermountain Gold Inc.**Acquisition
                  costs
              
              
              137,461
              
              
              -
              
              
              -
              
              
              137,461Deferred
                  exploration
              
              
              432,299
              
              
              617,594
              
              
              -
              
              
              1,049,893**569,760**
              
              
              **617,594**
              
              
              **-**
              
              
              **1,187,354****Other
                  Nevada Projects**Acquisition
                  costs
              
              
              132,354
              
              
              -
              
              
              (112,354
              )
              
              20,000Deferred
                  exploration
              
              
              232,148
              
              
              88,978
              
              
              (229,797
              )
              
              91,329**364,502**
              
              
              **88,979**
              
              
              **(342,151**
              **)**
              
              **111,329****Total**Acquisition
                  costs
              
              
              6,991,077
              
              
              5,291,477
              
              
              (177,454
              )
              
              12,105,100Deferred
                  exploration
              
              
              2,027,293
              
              
              2,732,277
              
              
              (229,797
              )
              
              4,529,773**Total
                  Mineral Interests**
              
              **$**
              **9,018,370**
              ****
              **$**
              **8,023,754**
              ****
              **$**
              **(407,251**
              **)**
              **$**
              **16,634,873**
              ****
  Continued
        exploration of the Company’s mineral properties are subject to
        certain lease payments, project holding costs, rental fees and filing
        fees.
 
 a) **Courageous
        Lake**
 In
        2002,
        the Company purchased a 100% interest in the Courageous Lake gold project
        from
        Newmont Canada Limited and Total Resources (Canada) Limited (“the Vendors”) for
        US$2.5 million. The Courageous Lake gold project consists of mining leases
        located in Northwest Territories of Canada.
 
 The
        Vendors were granted a 2% net smelter royalty interest in the project. In
        addition, the Company agreed to pay the Vendors US$1.5 million when the spot
        price of gold closed at or above US$360 per ounce for 10 consecutive days
        (paid
        in March 2003), and pay the Vendors US$1.5 million when the spot price of
        gold
        closed at or above US$400 per ounce or a production decision is made at
        Courageous Lake, whichever is earlier (paid in February 2004).
 
 In
        2004,
        an additional property was optioned in the area. Under the terms of the
        agreement, the Company paid $50,000 on closing and is required to make option
        payments of $50,000 on each of the first two anniversary dates and subsequently
        $100,000 per year. In addition, the property may be purchased at any time
        for
        $1,250,000 with any option payments being credited against the purchase
        price.
  b) **Castle
        Black Rock**
 The
        Company entered into a mining lease agreement dated August 15, 2000, and
        amended
        on August 1, 2001, with respect to mineral claims located in Esmeralda
        County, Nevada, USA. In 2002, the Company paid US$17,500 and in 2003, US$25,000
        in advance royalties and is required to pay further advance royalties of
        US$25,000 each August 15 thereafter and to pay a production royalty, varying
        with the price of gold, of 3% to 5%, and a 3.5% royalty on gross proceeds
        from
        other metals produced. The Company has the right to purchase 50% of the
        production royalty for US$1.8 million.
  108
 Table
            of Contents
  c) **Grassy
        Mountain**
 In
        2000,
        the Company acquired an option on a 100% interest in mineral claims located
        in
        Malheur County, Oregon, USA. During 2002, the Company paid US$50,000 in option
        payments. On December 23, 2002, the agreement was amended and the Company
        made a
        further option payment of US$300,000 and in March 2003 acquired the property
        for
        a payment of US$600,000. As part of the acquisition of the Grassy Mountain
        property, the Company acquired one million shares of a U.S. based private
        exploration company at US$0.50 per share which represented approximately
        6.9% of
        the private company’s issued and outstanding shares. Subsequently, the private
        company was merged with Atlas Precious Metals Inc. (“APMI”). On the merger, the
        Company’s one million shares of the private company were converted into
        1,200,000 common shares of APMI representing approximately 5.7% of APMI’s issued
        and outstanding shares.
 
 d) **Hog
        Ranch**
 In
        2000,
        the Company entered into a mining lease agreement for mineral claims located
        in
        Washoe County, Nevada. Advance royalties are payable as to US$15,000 on November
        15, 2006; US$17,500 on November 15, 2007; US$20,000 on November 15, 2008
        and
        each November 15 thereafter. A production royalty is payable varying with
        the
        price of gold, ranging from 3% to 5%, and a 3.5% royalty on the gross proceeds
        from other metals. 40% of the production royalty may be purchased for US$2
        million. In August 2003, The Company optioned a 60% interest in the Hog Ranch
        project in Nevada, USA to Romarco Minerals Inc. (“Romarco”). Under the terms of
        the agreement the Company received 200,000 shares of Romarco valued at $52,000
        in 2003 and in 2004 received 200,000 shares valued at $45,000 which amounts
        were
        shown as a recovery of mineral interests and the investments are included
        in
        marketable securities on the balance sheet. In February 2005, Romarco terminated
        its option on the Hog Ranch property.
 
 e) **Kerr-Sulphurets**
 In
        2001,
        the Company purchased a 100% interest in contiguous claim blocks in the Skeena
        Mining Division, British Columbia. The vendor maintains a 1% net smelter
        royalty
        interest on the project, subject to a maximum aggregate of royalty payments
        of
        $4.5 million. The Company is obligated to purchase the net smelter royalty
        interest for the price of $4.5 million in the event that a positive feasibility
        study demonstrates a 10% or higher internal rate of return after tax and
        financing costs.
 
 In
        2002,
        the Company optioned the property to Falconbridge Limited (formerly known
        as
        Noranda Inc.) which can earn a 50% interest by spending $6 million on
        exploration within 6 years. Falconbridge can earn a further 15% by funding
        all
        costs to complete a feasibility study on the project. If after earning its
        50%
        interest, Falconbridge elects not to proceed with a feasibility study, the
        Company has the option to acquire Falconbridge’s interest for $3 million. After
        having earned its 50% interest, Falconbridge has the right to delay its decision
        to proceed with a feasibility study for up to 3 years by either spending
        $1.25
        million per year on the property or making payments to the Company which
        would
        total $1.5 million over the three-year period. In 2005, Falconbridge completed
        4,092 metres of drilling and had encouragement in two areas. Plans are in
        progress for further drilling in 2006.
 
 f) **Quartz
        Mountain**
 In
        2001,
        the Company purchased a 100% interest in mineral claims in Lake County, Oregon.
        The vendor retained a 1% net smelter royalty interest on unpatented claims
        acquired and there is a 0.5% net smelter royalty interest to an unrelated
        third
        party as a finder’s fee. In October 2003, the Company optioned a 50% interest in
        the Quartz Mountain project in Oregon, USA to Quincy Energy Corp. (formerly
        Quincy Resources Inc.). The current gold resource known on the property is
        excluded from the agreement. The terms of the agreement require Quincy to
        incur
        US$1.5 million in exploration and issue 250,000 of its shares in stages by
        October 2008. Quincy can earn a further 12.5% interest in the project by
        funding
        a feasibility study and issuing a further 250,000 of its shares to the Company.
        If after earning its 50% interest, Quincy elects not to proceed with a
        feasibility study, the Company has the option to acquire Quincy’s interest for
        US$750,000. In 2003, the Company received the first payment of 50,000 shares
        of
        Quincy valued at $13,100 which amount was shown as a recovery of mineral
        interests and the investment is included in marketable securities on the
        balance
        sheet.
 
 g) **Red
        Mountain**
 In
        2001,
        the Company purchased a 100% interest in an array of assets associated with
        mineral claims in the Skeena Mining Division, British Columbia, together
        with
        related project data and drill core, an owned office building and a leased
        warehouse, various mining equipment on the project site, and a mineral
        exploration permit which is associated with a cash reclamation deposit of
        $1
        million.
 
 The
        Company assumed all liabilities associated with the array of assets acquired,
        including all environmental liabilities, all ongoing licensing obligations
        and
        ongoing leasehold obligations including net smelter royalty obligations on
        certain mineral claims ranging from 2.0% to 6.5% as well as an annual minimum
        royalty payment of $50,000.
 
 h) **Pacific
        Intermountain Gold Inc.**
 During
        2002, the Company and an unrelated party incorporated Pacific Intermountain
        Gold
        Inc. (“PIGCO”). The Company funded PIGCO’s share capital of $755,000 and
        received a 75% interest. The other party provided the exclusive use of an
        exploration database and received a 25% interest. The value associated with
        the
        use of this database, being the minority interest in PIGCO at December 31,
        2002
        was charged to operations as Pacific Intermountain Gold exploration. Subsequent
        to 2002, funding which was for deferred exploration expenditures has been
        by way
        of loans to PIGCO. In July 2004, the Company acquired the 25% interest in
        PIGCO
        which it did not own for forgiving debt of approximately $65,000 and agreeing
        to
        pay 10% of any sale of projects to third parties. The minority interest
        liability value amounting to $207,369 was deleted and the amount credited
        against PIGCO deferred exploration expenses on the balance sheet.
 
 The
        Company and PIGCO acquired approximately 30 claim blocks in Nevada, USA in
        2002.
        A 50% interest in one property, Thunder Mountain, was optioned to a third
        party
        in 2002. The optionee paid US$25,000 in cash and issued 250,000 of its shares
        and was required to spend US$1.5 million in exploration over a three year
        period
        and issue PIGCO 500,000 common shares on or before the first anniversary
        and
        750,000 on or before the second anniversary. At the completion of the earn-in,
        a
        50-50 joint venture would have been formed with the optionee as operator.
        In
        2003, the agreement was amended with the Clifford property, another PIGCO
        owned
        property, was added to the agreement and the 500,000 shares being payable
        in
        2004. During 2004, the third party terminated all of its rights under the
        option
        agreement.
 
 109
 Table
            of Contents
  i) **Other
        Nevada Projects**
 In
        2003,
        the Company wrote off the acquisition costs and deferred exploration costs
        associated with the Tobin Basin project, which totalled $342,151, as the
        exploration results did not warrant further work and the property was
        abandoned.
 **4.**
              **RECLAMATION
                  DEPOSITS, PROVISIONS FOR RECLAMATION LIABILITIES AND ASSET RETIREMENT
                  OBLIGATIONS**
 The
        balance in reclamation deposits represents the Company’s interest in Canadian
        bank term deposits which are held for the benefit of the Province of British
        Columbia until released or applied to reclamation costs which may arise in
        the
        future. Interest earned is paid to the Company. During 2001, a deposit of
        $225,000 was made in respect of the Kerr-Sulphurets gold project and a deposit
        of $1 million was transferred to the Company’s name for the Red Mountain
        project. A corresponding reclamation provision of $1 million was recorded
        as an
        estimation of any potential future reclamation costs. This reclamation provision
        is an estimate, and therefore the provision is subject to changes in regulatory
        requirements and other external factors. During 2003, a reclamation provision
        of
        US$146,000 (CDN$189,289) was recorded on the Grassy Mountain property. The
        corresponding reclamation deposit is in the process of being finalized and
        deposited with the regulatory authorities. The Kerr-Sulphurets deposit was
        returned to the Company during 2004.
 
 The
        fair
        value of the asset retirement obligations was calculated using the total
        undiscounted cash flows required to settle estimated obligations of $1,189,000,
        expected timing of cash flow payments required to settle the obligations,
        credit-adjusted risk-free discount rate of 8.76% and an inflation rate of
        2.0%.
  **5.**
              **CONVERTIBLE
                  DEBENTURES**
 An
        $800,000 debenture was issued on April 11, 2002 with a four-year term maturing
        April 10, 2006. The debenture was secured by a general charge on the assets
        of
        the Company, bore interest at 5% per annum and, at the option of the holder,
        was
        convertible into common shares of the Company at the exercise price of $0.80
        per
        share for the first two years, $0.90 per share in year three and $1.00 per
        share
        in year four. Interest for the first two years was accrued and added to the
        principal amount. The Company had the option to force conversion of the
        debentures into common shares if certain share price and trading volume
        thresholds are met. In April 2003, the debenture including accrued interest
        totalling $841,018 was converted into 1,051,272 common shares of the Company.
 
 **6.**
              **SHAREHOLDERS’
                  EQUITY**
 
 **a)
                  Share Capital****Shares**
              
              **Amount**AuthorizedUnlimited
                  number of common shares without par value, unlimited number of
                  preference
                  shares (non issued)Issued
                  - Common sharesBalance,
                    December 31, 2002
              
              
              23,254,913
              
              $
              25,954,624Issued
                  during yearFor
                  cash, exercise of stock options
              
              
              91,100
              
              
              87,520For
                  cash, exercise of warrants
              
              
              1,797,500
              
              
              3,465,250For
                  cash, private placements
              
              
              1,390,000
              
              
              3,734,875Convertible
                  debentures and interest
              
              
              1,051,272
              
              
              841,018Value
                  of share purchase warrants and stock options exercised
              
              
              -
              
              
              386,9754,329,872
              
              
              8,515,638Balance,
                  December 31, 2003
              
              
              27,584,785
              
              
              34,470,262Issued
                  during yearFor
                  cash, exercise of stock options
              
              
              200,000
              
              
              212,650For
                  cash, exercise of warrants
              
              
              225,000
              
              
              562,500For
                  cash, private placements (iii)
              
              
              1,705,000
              
              
              7,466,224Value
                  of share purchase warrants and stock options exercised
              
              
              -
              
              
              99,500Renunciation
                  of flow-through share value (ii)
              
              
              -
              
              
              (580,800
              )2,130,000
              
              
              7,760,074Balance,
                  December 31, 2004
              
              
              29,714,785
              
              
              42,230,336Issued
                  during yearFor
                  cash, exercise of stock options
              
              
              169,400
              
              
              360,905For
                  cash, exercise of warrants
              
              
              287,500
              
              
              862,500For
                  cash, private placements (i)
              
              
              1,935,000
              
              
              10,075,646Value
                  of share purchase warrants and stock options exercised
              
              
              -
              
              
              206,358Renunciation
                  of flow-through share value (ii)
              
              
              -
              
              
              (820,800
              )2,391,900
              
              
              10,684,609Balance,
                  December 31, 2005
              
              
              32,106,685
              
              $
              52,914,945
 
 i)
              In
                  October 2005, the Company completed a private placement consisting
                  of
                  1,000,000 common shares for gross proceeds of
                  $5,000,000.
 
 In
        February 2005 and December 2005, the Company completed private placement
        flow-through financings of 500,000 common shares for gross proceeds of
        $2,125,000 and 435,000 common shares for gross proceeds of $3,153,750,
        respectively. Under the terms of the financings the Company will renounce
        to the
        investors the Canadian Exploration Expenses (“CEE”) incurred with the proceeds
        of the financings. The balance of funds not spent by December 31, 2005 has
        been
        recorded on the balance sheet as Cash held for Exploration Expenditures.
        In
        February 2006, the CEE was renounced to the investors.
  110
 Table
            of Contents
  ii)
              In
                  January 2005, the Company renounced $2,272,500 (2004 - $1,608,000)
                  in
                  Canadian Exploration Expenses to investors of flow-through shares
                  in 2004
                  and 2003, respectively. The tax value of these renunciations has
                  been
                  recorded as a future tax liability and charged against share capital.
                  Since the Company has a valuation allowance which reduces the future
                  income tax assets, the valuation allowance has been reduced and
                  income tax
                  recoveries have been recognized in the statement of
                  operations.
  iii)
              In
                  May 2004, the Company completed a private placement consisting
                  of
                  1,200,000 common shares for gross proceeds of
                  $5,400,000.
 
 In
        September 2004, the Company completed a private placement flow-through financing
        of 505,000 common shares for gross proceeds of $2,272,500. Under the terms
        of
        the financing, the Company will renounce to the investors the Canadian
        Exploration Expenses (“CEE”) incurred with the proceeds of the financings. The
        balance of funds not spent by December 31, 2004 was recorded on the balance
        sheet as Cash for Exploration Expenditures. In January 2005, the CEE was
        renounced to the investors.
 
 **b)Stock
        Options
        Outstanding**
 The
        Company provides compensation to directors, employees and consultants in
        the
        form of stock options. In August 2002, the Company announced new provisions
        to
        the stock option plan for directors and senior manage-ment. New option grants
        to
        directors and senior management are subject to a two-tiered vesting policy
        designed to better align option compensation with the interests of shareholders.
        Grants to other employees and consultants do not have the two-tiered
        provision.
  The
        Board
        granted options as to 600,000 in August 2002, as to 100,000 in August 2004
        and
        as to 50,000 in January 2005 to senior management in lieu of market rate
        salaries. These option grants require a $6.00 share price for 10 successive
        days
        for the first third to vest, a $9.00 share price for the second third and
        a
        $12.00 share price for the final third. Once the share price has met the
        first
        test, the Company’s share price performance must have exceeded the Toronto Stock
        Exchange Canadian Gold Index by more than 20% over the preceding six months
        or
        these options will be cancelled.
  In
        October 2005, the $6 vesting criteria was reached and in December 2005 the
        $9
        vesting criteria was reached. The completed vesting criteria also included
        the
        requirements that the share price performance must have exceeded the Toronto
        Stock Exchange Canadian Gold Index by more than 20% over the preceding six
        months. Compensation expense on the latter two vesting criteria, which related
        to the vesting of 500,000 shares, has been recognized in the amount of
        $331,566.
  The
        weighted average grant date fair value of options granted during 2005 which
        were
        not subject to the two-tiered vesting criteria described above was $3.33
        (2004 -
        $1.53, 2003 - $1.19). The grant of these 45,000 options resulted in compensation
        expense totalling $29,784 compared to 75,000 options resulting in compensation
        expense totalling $114,735 during 2004 and 110,000 options resulting in
        compensation expense of $131,571 during 2003. 30,000 of the 2005 options
        vest
        over the period December 2005 to December 2006 and consequently the expense
        will
        be recognized over that one year period.****The
        fair
        value of the options granted is estimated on the dates of grant using a
        Black-Scholes option-pricing model with the following
        assumptions:
 
 **2005**
              
              **2004**
              
              **2003**Dividend
                  yield
              
              
              Nil
              
              
              Nil
              
              
              NilExpected
                  volatility
              
              
              60%
              
              
              37%
              
              
              50%Risk
                  free rate of return
              
              
              4.21%
              
              
              4.0%
              
              
              4.0%Expected
                  life of options
              
              
              3.5years
              
              
              3
                  years
              
              
              3
                  years
 
 A
        summary
        of the status of the plans at December 31, 2005 and changes during the years
        are
        presented below:
 
 **Shares**
              
              **Weighted
                  Average Exercise Price**
              
              **Amount**Outstanding
                  at December 31, 2002
              
              
              1,960,000
              
              $
              1.64
              
              $
              520,320Granted
              
              
              110,000
              
              
              3.19
              
              
              131,571Exercised
              
              
              (91,100
              )
              
              0.96
              
              
              (41,950
              )Outstanding
                  at December 31, 2003
              
              
              1,978,900
              
              
              1.66
              
              
              609,941Granted
              
              
              175,000
              
              
              4.14
              
              
              114,735Exercised
              
              
              (200,000
              )
              
              1.06
              
              
              (20,750
              )Outstanding
                  at December 31, 2004
              
              
              1,953,900
              
              
              1.57
              
              
              703,926Granted
              
              
              95,000
              
              
              5.74
              
              
              29,784Exercised
              
              
              (169,400
              )
              
              (2.13
              )
              
              (105,733
              )Value
                  of two-tiered options vested
              
              
              -
              
              
              -
              
              
              331,566**Outstanding
                  at December 31, 2005**
              
              
              **1,879,500**
              
              **$**
              **2.21**
              
              **$**
              **959,543**
 
 111
 Table
            of Contents
 
 **Number
                  of Shares**
              **Option
                  Price Per Share**
              **Expiry
                  Date**347,000
              $
                  0.70
              May
                  17, 200672,000
              $
                  0.70
              May
                  28, 200633,333
              $
                  0.60
              June
                  12, 200616,667
              $
                  0.60
              August
                  13, 200650,000
              $
                  0.60
              November
                  5, 200678,000
              $
                  0.88
              February
                  17, 200740,000
              $
                  2.63
              May
                  30, 2007325,000
              $
                  2.90
              July
                  1, 2007600,000
              $
                  2.20
              August
                  19, 200710,000
              $
                  2.58
              December
                  18, 200715,000
              $
                  2.08
              June
                  3, 200820,000
              $
                  2.85
              August
                  12, 200815,000
              $
                  3.82
              October
                  28, 200837,500
              $
                  5.65
              January
                  13, 200925,000
              $
                  4.60
              April
                  20, 2009100,000
              $
                  3.37
              August
                  13, 200965,000
              $
                  4.00
              January
                  11, 201030,000
              $
                  9.50
              December
                  20, 2010**1,879,500**
              $
                  2.21
 
 At
        December 31, 2005 there were 1,879,500 options outstanding of which 1,584,500
        were exercisable at prices ranging from $0.60 to $5.65 each. In addition,
        there
        were 250,000 subject to the two-tiered vesting provisions and 45,000 which
        vest
        during 2006.
  c) Share
        Purchase
        Warrants
 The
        Company's movement in share purchase warrants is as
        follows:
  **Number
                    of Warrants**
                
                **Amount**Balance
                    at December 31, 2002
                1,892,500
                $
                364,525Issued
                    for cash
                512,500
                
                179,375Exercised
                (1,797,500)
                
                (344,575)Expired
                (95,000)
                
                (19,950)Balance
                    at December 31, 2003
                512,500
                
                179,375Issued
                    for cash
                (225,000)
                
                (78,750)Balance
                    at December 31, 2004
                287,500
                
                100,625Exercised
                (287,500)
                
                (100,625)**Balance
                    at December 31, 2005**
                **-**
                **$**
                **-**
  **7.**  **RELATED
        PARTY TRANSACTIONS**
 a)
        During
        the year, a private company controlled by a director of the Company was paid
        $39,400 (2004 - $56,700, 2003 - $27,400) for technical services provided
        by his
        company related to the mineral properties.
 b)During
        the year, a private company controlled by a second director was paid $120,000
        (2004 - $132,500, 2003 - $60,000) for consulting services
        rendered.
  These
        transactions were in the normal course of operations and were measured at
        the
        exchange amount, which is the amount of consideration established and agreed
        to
        by the related parties.
 
 **8.**  **FINANCIAL
        INSTRUMENTS**
 The
        fair
        value of the Company’s cash and cash equivalents and short term deposits, cash
        held for exploration expenditures, amounts receivable, reclamation deposits
        and
        accounts payable and accruals at December 31, 2005 and December 31, 2004
        is
        estimated to approximate their carrying values due to the immediate or
        short-term maturity of these financial instruments.
 
 **9.**  **INCOME
        TAXES**
 The
        income tax recovery varies from the amounts that would be computed by applying
        the basic federal and provincial income tax rates aggregating to 36.12% (2004
        -
        36.12%, 2003 - 40.0%) as follows:
  **2005**
                
                **2004**
                
                **2003**Statutory
                    rate applied to loss for year
                $
                714,000
                
                $
                650,000
                
                $
                535,000Non
                    deductible items
                
                (217,000
                )
                
                (151,000
                )
                
                (195,000
                )Losses
                    not tax benefited
                
                (497,000
                )
                
                (499,000
                )
                
                (340,000
                )Reduction
                    in valuation allowance
                
                820,800
                
                
                575,000
                
                
                -$
                820,800
                
                $
                575,000
                
                $
                -
 
 112
 Table
            of Contents
  Significant
        components of the Company’s future tax assets and liabilities are as
        follows:
  **2005**
                ****
                ****
                **2004**Future
                  income tax assetsMineral
                    interests
                
                $
                135,000
                
                $
                986,000****Share
                    issue costs****
                
                
                103,000
                
                
                60,000Non
                    capital losses
                
                
                1,508,000
                
                
                1,221,0001,746,000
                
                
                2,267,
                    000Valuation
                    allowance
                
                
                (1,746,000
                )
                
                (2,267,000
                )Future
                    income tax assets, net
                
                $
                -
                
                $
                -
  
 A
        future
        tax asset of approximately $975,000 (2004 - $575,000) in one Canadian entity
        has
        been offset with a future tax liability in another Canadian entity on the
        basis
        that management has undertaken to carry out tax planning measures when
        required.
  The
        Company has accumulated non-capital losses for Canadian tax purposes of
        approximately $4,216,000 which expire in various years to 2015 as follows:
 
 2006
              
              $
              32,0002007
              
              
              185,0002008
              
              
              338,0002009
              
              
              735,0002010
              
              
              707,0002014
              
              
              910,0002015
              
              
              1,309,000**$**
              **4,216,000**
 
 The
        benefit of the above loss carry forwards has not been recognized for accounting
        purposes.
 
 **10.** **SUBSEQUENT
        EVENT**
 In
        January 2006, the Company granted 875,000 five-year options to directors
        at an
        exercise price of $10.56 each and subject to the two-tiered vesting policy
        established in 2002. These option grants require a $15.00 share price for
        10
        successive days for the first third to vest, an $18.00 share price for the
        second third and a $21.00 share price for the final third. Once the share
        price
        has met the first test, the Company’s share price performance must have exceeded
        the Toronto Stock Exchange Canadian Gold Index by more than 20% over the
        preceding six months or these options will be cancelled. These option grants
        are
        also subject to the approval of shareholders at the next meeting of
        shareholders.
 
 **11.** **RECONCILIATION
        TO UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES**
 These
        financial statements have been prepared in accordance with generally accepted
        accounting principles (“GAAP”) in Canada. Except as set out below, these
        financial statements also comply, in all material aspects, with accounting
        principles generally accepted in the United States and the rules and regulations
        of the U.S. Securities and Exchange Commission. The following tables reconcile
        results as reported under Canadian GAAP with those that would have been reported
        under United States GAAP:
 
 Statements
        of operations:
 **2005**
              
              **2004**
              
              **2003**Net
                  loss for year - Canadian GAAP
              $
              (1,157,281
              )
              $
              (1,226,288
              )
              $
              (1,338,272
              )Mineral
                  interests prior to the establishmentof
                  proven and probable reserves (a)
              
              (3,351,221
              )
              
              (4,448,044
              )
              
              (2,502,480
              )Amortization
                  of acquisition costs (a)
              
              -
              
              
              (324,402
              )
              
              (1,020,036
              )Amortization
                  of option payments (a)
              
              -
              
              
              -
              
              
              (473,280
              )Flow-through
                  share renunciation
              
              (820,800
              )
              
              (580,800
              )
              
              -Flow-through
                  share value
              
              202,000
              
              
              97,200
              
              
              -Minority
                  interest (b)
              
              -
              
              
              (188,644
              )
              
              79,250$
              (5,127,302
              )
              $
              (6,670,978
              )
              $
              (5,254,818
              )Loss
                  per share - U.S. GAAP, Basic and diluted
              $
              (0.17
              )
              $
              (0.23
              )
              $
              (0.20
              )
  Statements
        of cash flows:
 **Canadian
                  GAAP**
              
              **U.S.
                  GAAP****2005**
              
              
              **2004**
              
              
              **2003**
              
              
              **2005**
              
              
              **2004**
              
              
              **2003**Cash
                  used in operating activities
              $
              (1,220,487
              )
              $
              (1,764,345
              )
              $
              (816,206
              )
              $
              (4,571,708
              )
              $
              (6,212,389
              )
              $
              (3,548,483
              )Cash
                  used in investing activities
              $
              (7,084,510
              )
              $
              (8,228,328
              )
              $
              (4,452,313
              )
              $
              (3,733,289
              )
              $
              (3,780,284
              )
              $
              (1,720,036
              )
 
 113
 Table
            of Contents
  Balance
        sheets:
 ******Canadian
                  GAAP**
              
              ******U.S.
                  GAAP****2005**
              
              **2004**
              
              **2005**
              
              **2004**Mineral
                  interests - unproven (a)
              $
              24,395,438
              
              $
              20,998,671
              
              $
              9,158,995
              
              $
              9,113,449Liabilities
              $
              -
              
              $
              -
              
              $
              421,800
              
              $
              202,000Shareholders’
                  equity
              $
              35,384,875
              
              $
              25,702,555
              
              $
              19,726,632
              
              $
              13,615,533
  **a) Mineral
        interests**
 Under
        United States GAAP, acquisition costs associated with mining interests are
        classified according to the land tenure position and the existence of proven
        and
        probable reserves as defined under Industry Guide 7.
 
 Under
        United States GAAP, through to March 31, 2004, costs associated with owned
        mineral claims and mining leases were classified as definite life intangible
        assets and amortized over the period of intended use or until proven and
        probable reserves are established ranging from four to eleven years. Effective
        April 1, 2004, pursuant to EITF 04-2, the Company classified its mineral
        rights
        as tangible assets and stopped amortizing them. This change was accounted
        for
        prospectively. These assets are tested for recoverability whenever events
        or
        changes in circumstances indicate that its carrying value may not be
        recoverable. Under Canadian GAAP the unit of production basis of amortization
        is
        acceptable prior to the establishment of proven and probable reserves resulting
        in no amortization during the exploration and development phase.
 
 Under
        United States GAAP, costs associated with options to acquire mineral claims
        and
        mining leases are regarded as having a finite life expiring over the term
        of the
        option agreement and are not a component of the acquisition cost. Under Canadian
        GAAP the option payments are regarded as part of the acquisition cost and
        are
        deferred until the option is exercised when they are reclassified depending
        on
        the ownership position acquired or charged to operations if the option is
        not
        exercised.
 
 Under
        United States GAAP, exploration expenditures relating to mining interests
        prior
        to the completion of a definitive feasibility study, which establishes proven
        and probable reserves must be expensed as incurred. Under Canadian GAAP these
        costs may be deferred.
 
 **b) Minority
        interest**
 Under
        United States GAAP the minority interest recognized in respect of PIGCO is
        nil
        at December 31, 2003. The US GAAP net assets of PIGCO are reduced compared
        to
        the net assets under Canadian GAAP due to the write off of exploration
        expenditures and the amortization of acquisition expenditures (as explained
        in
        (a) above). In 2004, the minority interest in PIGCO was acquired by the Company
        and the balance credited to Deferred Exploration.
  **c)** **Flow-through
        shares**
 Under
        United States GAAP when flow-through shares are issued, the proceeds are
        allocated between the issue of shares and the sale of tax benefits. The
        allocation is made based on the difference between the quoted price of the
        existing shares and the amount that the investor pays for the shares. The
        shareholders’ equity is reduced and a liability is recognized for this
        difference which amounted to $202,000 for the flow-through shares issued
        in 2004
        (2003 - $97,200). The liability is reversed when the tax benefits are renounced
        and a deferred tax liability recognized at that time. Income tax expense
        is the
        difference between the amount of the deferred tax liability and the liability
        recognized on issuance.
  **d)** **Comprehensive
        income**
 Statement
        of Financial Standards No. 130 “Reporting Comprehensive Income” (“FAS 130”) is
        applicable for U.S. GAAP purposes. FAS 130 establishes standards for the
        reporting and display of comprehensive income and its components in a full
        set
        of general purpose financial statements. FAS 130 requires that all items
        that
        are required to be recognized under accounting standards as components of
        comprehensive income be reported in a financial statement. No material
        difference arises from the application of FAS 130.
 
 In
        January 2005, the CICA issued re-exposure drafts of the proposed Handbook
        Section 1530 *Comprehensive
        Income* which
        harmonizes Canadian GAAP with U.S. GAAP. The CICA has proposed that mandatory
        implementation of these standards be for interim and annual financial statements
        relating to years commencing on or after October 1, 2006.
 
 **e)** **Impact
        of recent United States accounting pronouncements**
 In
        November 2004, the FASB issued FAS 151, which clarifies the accounting for
        abnormal amounts of idle facility expense, freight, handling costs and wasted
        material as they relate to inventory costing and requires these items to
        be
        recognized as current period expenses. Additionally, the allocation of fixed
        production overheads to the cost of inventory should be based on the normal
        capacity of the production facilities. FAS 151 is effective for inventory
        costs
        incurred during fiscal years beginning after June 15, 2005. The Company does
        not
        believe that the application of FAS 151 will have an impact on the consolidated
        financial statements under U.S. GAAP.
 
 In
        December 2004, the FASB issued FAS 153, which deals with the accounting for
        the
        exchanges of non-monetary assets and is an amendment of Accounting Principles
        Board (“APB”) Opinion 29. FAS 153 eliminates the exception from using fair
        market value for non-monetary exchanges of similar productive assets and
        replaces it with a general exception for exchanges of non-monetary assets
        that
        do not have commercial substance, as defined. FAS 153 is effective for
        non-monetary asset exchanges occurring in fiscal periods beginning after
        June
        15, 2005. The Company does not believe that the application of FAS 153 will
        have
        an impact on the consolidated financial statements under U.S. GAAP.
 
 In
        December 2004, FASB Statement No. 123 (revised), Shared-based Payment, was
        issued. This statement requires an entity to recognize the grant date fair
        value
        of stock options and other equity-based compensation issued to employees.
        In the
        income statement, FASB Statement No. 123 (revised) eliminates the ability
        to
        account for share-based compensation
  114
 Table
            of Contents
  transactions
        using the intrinsic value method in APB Opinion No. 25. The Company, effective
        January 1, 2003, adopted FASB Statement No. 123, Accounting for Stock-based
        Compensation, as amended by FASB Statement No. 148, Accounting for Stock-based
        Compensation - Transition and Disclosure, and will adopt FASB Statement No.
        123
        (revised) in 2006 in accordance with the appropriate transition options and
        adoption period prescribed in the Statement. Adoption of this standard will
        not
        have an impact on the consolidated financial statements.
 
 During
        June 2005, the FASB issued SFAS No. 154, "Accounting for Changes in Accounting
        Principles and Error Corrections". The new standard requires that entities
        which
        make a voluntary change in accounting principle apply that change retroactively
        to prior period financial statements, unless this would be impracticable.
        For
        changes in methods of depreciation, amortization or depletion for long-lived
        assets, the change must be accounted for prospectively, as a change in estimate.
        SFAS No. 154 is effective for the Company's 2006 financial statements and
        is not
        expected to impact earnings.







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**Signature
      Page**





The
      Registrant hereby certifies that it meets all of the requirements for filing
      on
      Form 20-F and that it has duly caused and authorized the undersigned to sign
      this annual report on its behalf.




**Seabridge
      Gold Inc.**


**Registrant**








**Dated:
                March 15, 2005**
            **Signed:**
            **/s/
                Rudi Fronk**Rudi
                FronkPresident
                and C.E.O.




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