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Fireweed Announces Signing of Definitive Agreement on Mactung Project

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Fireweed Announces Signing of Definitive Agreement on Mactung Project

 

 

 

 

 

FIREWEED METALS CORP. (TSX-V: FWZ) (OTCQB: FWEDF) (formerly Fireweed Zinc Ltd.) is pleased to announce the signing of the definitive Asset Purchase Agreement for the acquisition of 100% interest in the Mactung Tungsten Project located in Yukon and Northwest Territories, Canada. Fireweed also announces appointment of a new Corporate Secretary and a small stock option grant to staff (see details below).

 

Highlights

  • Fireweed signed the definitive Asset Purchase Agreement to acquire the Mactung Tungsten Project
  • Mactung is one of the largest and highest-grade tungsten deposits in the world and one of the few potential sources of scale for this critical metal outside of China*
  • Approximately 38,000 metres of historic drilling1 outlined a large, high-grade tungsten resource and produced a positive historic feasibility study2
  • Fireweed is targeting a Q2 2023 Resource Update on the Project and is doing work to include by-product metals, such as gold, copper, and bismuth, in addition to tungsten
  • Mactung is located within the traditional territories of the Kaska Dena and First Nation of Na-Cho Nyäk Dun, and the Sahtú Settlement Area
  • Mactung is located 13 kilometres north of Fireweed’s Tom zinc-lead-silver deposit and is also accessible by the North Canol Road, providing potential for future project synergies
  • After closing of the Agreement about April 5, 2023, Fireweed will hold a 100% interest in Mactung

 

CEO Statement

 

Brandon Macdonald, CEO, stated “Last year we announced a binding Letter of Intent to acquire Mactung to a very positive reception, so we are now especially pleased to have signed the final Asset Purchase Agreement. This acquisition positions Fireweed as not just a leading global tungsten player, but a leading Critical Minerals explorer and developer when considered in combination with our Macmillan Pass Project, one of the world’s largest undeveloped zinc resources*, and our Gayna River zinc-lead-gallium-germanium project.”

 

Mactung Project Overview

 

Mactung is one of the largest and highest-grade tungsten deposits in the world*. It is an advanced stage exploration project with extensive drilling, engineering, metallurgy, geotechnical, and environmental and socioeconomic baseline data collected by previous owners that supported a feasibility study in 20092 and effects assessment in the Yukon completed in 2014 (see below). Tungsten skarn mineralization is developed in carbonate rocks near the contact with a granite intrusion. Historic 2007 indicated resources1 totaled 33.0 million tonnes (Mt) grading 0.88% WO3 (tungsten trioxide) plus historic inferred resources of 11.8 Mt grading 0.78% WO3. The 37.6 km2 property is located adjacent to Fireweed’s Macmillan Pass Property (Map 1) and accessed by the same road providing potential for future project synergies.

 

Historic Drilling and Historic Resource Estimates

 

Geological mapping and surface sample programs were conducted in the early and mid-1960’s, with drilling beginning in 1968. To date, approximately 38,000 metres (m) of drilling in 312 holes have been completed on the property, in addition to multiple historic resource estimates. An adit was opened in 1973 to enable underground exploration and bulk sampling; at least 1,200 metres of lateral underground development has occurred, including bulk samples of 270 tonnes (t) in 1973, 3.5 t in 1979, 650 t in 1983, and 79 t in 2005, enabling extensive metallurgical test work2.

 

Year Zones Territory Historic Estimate Type Tonnes (Mt) Grade
(% WO3)
Cut-off Grade (%WO3)
2009 2B Yukon only Probable Mineral Reserve2 10.79 1.187 0.616
2007 2B, 3D 3E, 3F Yukon NWT Indicated Mineral Resource1 33.03 0.88 0.5
2007 2B, 3D 3E, 3F Yukon NWT Inferred Mineral Resource1 11.86 0.78 0.5

Table 1. Most recent historic mineral resource and mineral reserve estimates from reports on www.sedar.com under NATC profile. (See Cautionary and Background Statements regarding Historic Minerals Resources below.)

 

Resource Update Plans

 

Fireweed is currently undertaking a re-sampling and assaying program on historic core from Mactung. The multi-element assaying program includes gold, copper, and bismuth analyses aiming to examine the potential for reporting these by-product metals in addition to tungsten in an upcoming Mineral Resource Estimate. Fireweed has engaged an independent consultant, Garth Kirkham, P.Geo., to estimate a Mineral Resource at Mactung and Fireweed anticipates that this work will be completed within Q2 2023.

 

Mactung Location & History

 

Mactung adjoins Fireweed’s Macmillan Pass Project (Macpass) and straddles the Yukon and Northwest Territories border. The Mactung tungsten deposit is located 13 km north of Fireweed’s Tom zinc-lead-silver deposit within Macpass (Map 1). Mactung is accessible by a road that joins the North Canol Highway 230 km from Ross River, or by the government-maintained Macmillan Pass airstrip near the Tom deposit.

 

Mactung was discovered and staked in 1962 by an Amax geologist. Extensive drilling, metallurgical testing, and multiple historical resource estimates were completed over the next twenty years. The property changed ownership several times and was subsequently acquired by the North American Tungsten Corporation (“NATC”) in 1997. In 2007 NATC published updated mineral resources (see above) and in 2009 published a positive feasibility study (available at www.sedar.com under the NATC profile). The Yukon Environmental and Socio-economic Assessment Board Executive Council issued its Referral Report and New Recommendation for Project Number 2008-0304 for the Mactung Mine Project in June 2014. Following a recommendation to Decision Bodies that the Project be allowed to proceed to licensing without review, subject to specific terms and conditions, Decision Documents were issued by the Yukon Government and Federal Government on September 3, 2014 and August 1, 2014, respectively.

 

Subsequently, in June 2015, NATC filed for and was granted creditor protection mainly related to operation of their Cantung mine located to the south. The Government of Northwest Territories purchased the Mactung Project for $4.5 million in the fall of 2015, and subsequently obtained a Class 4 Mining Land Use Approval in 2020 in order to keep the Yukon portion of the Project in good standing as an advanced mineral exploration property. Fireweed has now signed a definitive Asset Purchase Agreement for the Mactung Project with the GNWT (see details below).

 

Mactung Geology & Mineralization

 

Mactung is a tungsten skarn deposit located on the eastern margin of the Selwyn basin in the Canadian Cordillera’s Tombstone-Tungsten Belt (TTB). The mid-Cretaceous TTB spans Alaska, Yukon, and Northwest Territories, and hosts many other significant mineral deposits. The Mactung deposit is associated with Tungsten Suite intrusions that intruded late Precambrian to Palaeozoic age, variably metamorphosed clastic and interbedded carbonate rocks of the Selwyn basin. The tungsten mineralization at Mactung is comprised mostly of scheelite (CaWO4) and is dominated by calcic mineral assemblages associated with abundant pyrrhotite that developed within permeable limestone units of the Cambrian-Ordovician host rocks. Although the previous feasibility study considered only underground development, the majority of tungsten mineralization at Mactung can be found within 200 m from surface.

 

About Tungsten

 

Tungsten is the hardest metal with the highest melting point which makes it an important and often essential metal for use in the automotive, technology, energy, military and manufacturing industries. World tungsten production is dominated by China and there is currently little Western tungsten production which has led tungsten to be listed as a critical mineral by many governments, including Canada. The Canadian government has developed several initiatives to support and advance the exploration and mining of critical metals in Canada, including zinc and tungsten.

 

Terms of the Mactung Asset Purchase Agreement

 

Fireweed and the Government of Northwest Territories have signed a definitive Asset Purchase Agreement under which the GNWT is selling the Mactung Project to Fireweed for a total purchase price of C$15,000,000 staged as follows:

  1. Fireweed pays the GNWT the sum of $1,500,000 upon execution of a binding Letter of Intent (previously executed and paid);
  2. Fireweed will pay to GNWT an additional $3,500,000 within 18 months of the closing date of the definitive Asset Purchase Agreement (signed as described in this news release; closing date about April 5, 2023);
  3. Fireweed will pay to GNWT an additional $5,000,000 upon Fireweed announcing its intention to construct a mine on either the Mactung Project or any portion of the mineral property interests controlled by Fireweed in the Yukon, commonly known as the Macmillan Pass Project; and
  4. Fireweed will pay to GNWT an additional $5,000,000 upon Fireweed announcing its intention to construct a mine on the Mactung Project.

 

Mactung carries an existing net smelter return royalty of 4%, which is held by a third party, 2% of which can be purchased at any time for $2.5 million. The Asset Purchase Agreement does not include responsibility for any assets or liabilities related to the defunct NATC Cantung mine located further south. The final closing date, before which all claims, leases, and regulatory approvals will be transferred to Fireweed’s ownership, is expected to be about April 5th, 2023.

 

Sustainability Context

 

Fireweed respectfully acknowledges that the Mactung Project is located within the traditional territories of the Kaska Dena and First Nation of Na-Cho Nyäk Dun, and the Sahtú Settlement Area. For the benefit of present and future generations, Fireweed will conduct mineral development activities in a sustainable manner by working collaboratively with Indigenous groups and local communities, establishing a respectful and safe working environment, achieving a high standard of environmental stewardship, and undertaking studies and implementing measures to address local interests and issues.

 

Qualified Person Statement

 

Technical information in this news release has been approved by Brandon Macdonald, P.Geo., a ‘Qualified Person’ as defined under Canadian National Instrument 43-101.

 

Appointment of New Corporate Secretary

 

Fireweed is pleased to announce the appointment of Penny Johnson as the new Corporate Secretary of the Company to replace Jeffrey Dare. Ms. Johnson is an experienced Corporate Secretary, having spent more than 19 years working with Canadian mining companies which trade on the TSX, TSXV, and NYSE American. She has been involved in all aspects of the administration of publicly listed companies including legal and regulatory compliance, corporate governance, board and committee matters, continuous disclosure requirements, corporate transactions, financings, shareholder communications, and corporate records. Ms. Johnson is a member of the Governance Professionals of Canada and is a graduate of Brigham Young University. Fireweed would like to thank Mr. Dare for his diligent work for the Company and wishes him all the best in his future endeavours.

 

Grant of Stock Options

 

The Company announces that it is granting, pursuant to its stock option plan, a total of 280,000 stock options at a price of $0.85 per share for a five-year term to staff members including the new Corporate Secretary.

 

About Fireweed Metals Corp.

 

Fireweed Metals is a public mineral exploration company on the leading edge of Critical Minerals project development. Fireweed is well-funded, with a current cash position of C$38,600,000, and is well-positioned to carry out a large 2023 exploration program. The Company has three projects located in Canada:

 

Macmillan Pass Zinc-Lead-Silver Project:

 

Fireweed owns 100% of the district-scale 940 km2 Macmillan Pass Project in Yukon, Canada, which is host to one of the largest undeveloped zinc resources in the world* where the Tom and Jason zinc-lead-silver deposits have current Mineral Resources and a PEA economic study (see Fireweed news releases dated 10th January 2018, and 23rd May 2018, respectively, and reports filed on www.sedar.com for details). In addition, the Boundary Zone, Boundary Zone West, Tom North Zone and End Zone have significant zinc-lead-silver mineralization drilled but not yet classified as mineral resources. The project also includes large blocks of adjacent claims with known showings and significant upside exploration potential. The large 2022 drill program utilizing four drills is complete and assay results are being announced as they are received and interpreted.

  • Mactung Tungsten Project: Fireweed has signed a definitive Asset Purchase Agreement and acquired 100% interest in the 37.6 km2 Mactung Tungsten Project located adjacent to the Macmillan Pass Project. Mactung contains historic resources that make it one of the largest and highest-grade undeveloped resources in the world of the Critical Mineral tungsten*. Located in Canada, it is one of the rare large tungsten resources outside of China. An updated mineral resource is planned for Q2 2023, and re-sampling of historic drill core is continuing and will include assays for previously unreported byproduct metals, such as gold, copper, and bismuth, in addition to tungsten.
  • Gayna River Zinc-Lead-Gallium-Germanium Project: Fireweed has 100% of the 128.75 km2 Gayna River Project located 180 kilometres north of the Macmillan Pass Project. It is host to extensive mineralization including Critical Minerals zinc, gallium and germanium as well as lead and silver, outlined by 28,000 metres of historic drilling and significant upside potential. Results from the 2022 field program consisting of geochemical sampling, airborne LiDAR topographic surveying and ground geophysics are now being interpreted toward defining drill targets.

 

Posted February 28, 2023

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