Fireweed Zinc Ltd (TSX-V:FWZ) has struck a $15 million deal to acquire a new tungsten project immediately adjacent to its flagship Macmillan Pass zinc-lead-silver property in Yukon.
The Mactung project is one of the largest tungsten deposits in the world, with historic 2007 indicated resources of 33 million tonnes grading 0.88% WO3 (tungsten trioxide) plus historic inferred resources of 11.8 million tonnes grading 0.78% WO3.
Vancouver-based Fireweed hold a right to a 100% interest in the Mactung project through a binding letter of intent (LOI) with the Government of the Northwest Territories (GNWT).
READ: Fireweed Zinc acquires Gayna River project in Canada’s Northwest Territories
The acquisition of Mactung sets Fireweed up to become one of the few potential sources of scale for tungsten outside of China.
“While Macmillan Pass continues to be our flagship project, the recent staking of Gayna River and the addition of Mactung turns Fireweed into one of the leading critical mineral exploration companies,” CEO Brandon Macdonald said in a statement.
“We now have not only one of the largest undeveloped zinc resources in the world at our Macmillan Pass project, but also one of the world’s largest and highest-grade undeveloped tungsten projects at the advanced stage Mactung project. With both zinc and tungsten being designated as critical minerals by Canada, the US, and the EU, Fireweed is positioned to leverage the transition to a sustainable green economy.”
Large, high-grade tungsten resource
Mactung is located within the traditional territories of the Kaska Dena and First Nation of Na-Cho Nyäk Dun, and the Sahtú Settlement Area. Fireweed told investors it will “conduct mineral development activities in a sustainable manner by working collaboratively with Indigenous groups and local communities.”
Formerly in the hands of North American Tungsten Corporation, GNWT purchased Mactung in 2015 and subsequently obtained a Class 4 Mining Land Use Approval in 2020.
The property has around 38,000 metres of drilling that has outlined a large, high-grade tungsten resource and produced a positive historic feasibility study.
GNWT will sell Mactung to Fireweed for a total purchase price of $15 million, with an initial sum of $1.5 million due upfront and another $3.5 million within 18 months of finalizing the definitive agreement.
Fireweed will pay GNWT $5 million once it announces its plan to construct a mine on any of its Yukon projects, and an additional $5 million once it announces its intention to construct a mine on Mactung.
Mactung carries an existing NSR Royalty of 4% which is held by a third party, 2% of which can be purchased at any time for $2.5 million.
Fireweed hopes to finalize the definitive agreement before the end of 2022.
Contact Angela at angela@proactiveinvestors.com
Follow her on Twitter @AHarmantas