Junior awakens MacMillan Pass giant

Another slumbering zinc giant is being awakened in Canada's far north. The MacMillan Pass project, a venture targeting an extensive package of mining claims assembled recently by junior mining company Fireweed Zinc Ltd., hosts the large, advanced Tom and Jason zinc-lead-silver deposits and other occurrences of these minerals in southeastern Yukon Territory.

Established in 2015, Fireweed was organized specifically to investigate the potential of the MacMillan Pass area, where mining companies have sought commercial mineral deposits since the 1950s, but few using modern methods.

In 2017 after completing an initial public offering, Fireweed, managed by a group of Yukon-savvy geologists led by John Robins, hit the ground chasing promising targets in MacMillan Pass in hopes of developing known deposits and discovering new ones.

Located about 200 kilometers (120 miles) northeast of the settlement of Ross River near the North Canol Road within the Selwyn Basin of southeastern Yukon, MacMillan Pass hosts large deposits of zinc, lead and silver hosted in Devonian-age Lower Earn Group sedimentary rocks. Sulfide-barite mineralization occurs in thick stratiform lenses and extends for as much as 1,200 meters along strike and 450 meters down dip. The main sulfide minerals are sphalerite and galena.

S&P Global ranks the MacMillan Pass project 35th among the world's largest 350 zinc-rich projects that it tracks that contain more than 100 kilotons, or 220.5 million pounds, of zinc each, according to a Fireweed spokesman.

In mid-2017 after completing an initial public offering, Fireweed acquired the historic Tom and Jason deposits along with surrounding areas in MacMillan Pass from HudBay Minerals and mounted an exploration program aimed at establishing a new resource estimate for the project. Drawing on historic work at the deposits and encouraging first-season exploration results, Fireweed reported a NI 43-101-compliant resource estimate for the project in January 2018 with indicated resources of 11.2 million metric tons averaging 6.59 percent zinc, 2.48 percent lead and 21.33 grams per metric ton silver, or 9.61 percent zinc-equivalent with contained metal totaling 740,000 metric tons of zinc, 280,000 metric tons of lead and 7.69 million ounces of silver; and inferred resources of 39.47 million metric tons averaging 5.84 percent zinc, 3.14 percent lead and 38.15 g/t silver, or 10 percent zinc-equivalent with contained metal totaling 2.23 million metric tons of zinc, 1.22 million metric tons of lead and 48.41 million oz of silver.

Five months later, the junior released a positive NI 43-101-compliant preliminary economic assessment prepared by JDS Energy and Mining Inc. with work on tailings and water by Knight Piesold Consulting, both based in Vancouver.

The May 2018 assessment envisioned a long, 18-year, mine life for the project with 32 million metric tons of mineralization mined at a 4,900 metric-ton-per-day average processing rate and average annual contained metal production of 85 kilotons zinc, 48 kilotons lead and 2 million oz of silver.

The PEA predicted robust economics for the venture using metals prices of US$1.21/lb. for zinc, US$0.98/lb. for lead, and US$16.80/oz for silver.

It also envisioned manageable pre-production capital expenditures of C$404 million, calculated with a before-tax net present value at 8 percent of C$779 million (C$448 million after tax) and an internal rate of return of 32 percent (24 percent after tax) along with a rapid payback period of around four years.

The PEA cited existing starter pits on the Tom West and Jason Main zones as a reason to reduce upfront capital spending during development. It also noted that the potential district-scale project has significant upside in that its known deposits remained open for expansion, including into high-grade areas. The PEA does not include highly prospective areas that remain untested with modern methods on the property nor the known deposits on mining claims that Fireweed has acquired since early 2018.

Rapid expansion

Two completed exploration programs later, the PEA's projections still hold true, despite rapid expansion of the MacMillan Pass project through acquisitions and options that give Fireweed control of all known large zinc systems in the district.

The project now encompasses 544 square kilometers (210 square miles) of mineral claims. In addition to the Tom and Jason zones, MacMillan Pass now hosts the End and Boundary zones, both with significant mineralization drilled but not yet classified as mineral resources.

Fireweed currently maintains a 50-person camp near the Tom deposit, which is accessible via a three-kilometer (two miles) road to the North Canol Road, designated Yukon Highway No. 6, which intersects the Robert Campbell Highway and via a local airstrip.

As of June 30, the Tom deposits had seen 3,423 meters of underground development, 5,953 meters of underground core drilling in 84 holes, and 32,559 meters of surface core drilling in 149 holes; the Jason deposit, a total of 39,869 meters drilled in 136 holes from surface to date; and the End Zone, a total of 3,910 meters drilled in 18 holes from surface.

Since 2017, Fireweed has gained strong backing, including majors Hudbay (10 percent) and Teck Ltd. (10 percent), along with Resource Capital Group (13 percent) as major shareholders, while management has retained a 19 percent interest in the junior.

Earlier this year, the junior raised $5 million in financing and undertook an exploration program aimed at expanding the project's resources and exploring for new discoveries.

In August, Fireweed reported completion of its 2019 exploration season, with early results from the 16 diamond drill holes over 2,357 meters completed this year and the identification of two new targets for future exploration.

The junior tested targets this year at Tom North, Tom East, Tom West, Jason North, Target A, Target G, Target R, and the Boundary Zone.

Early results include encouraging assays from the first five drill holes in the Tom North open-pit target and a step-out hole at Tom West.

On Oct. 16, Fireweed reported results from hole NB19-001, the best-ever drilled to date at the Boundary zone located 15 kilometers (nine miles) west of the Jason zone. It intersected 3.44 percent zinc over a true width of 250 meters with high-grade subintervals including 16.35 percent zinc over a drill intersection of 23.31 meters, a lead and silver-rich section grading 9.18 percent zinc, 4.45 percent lead and 71.6 g/t silver over an intersection of 11.85 meters and local very high grade sections, including 47.70 percent zinc over an intersection of 1.01 meters.

"The Boundary zone results along with recent drilling success at Tom North and End Zone, have potential to expand on our current resources, which are already among the largest undeveloped zinc resources in the world, as well as improve project economics," MacDonald observed.