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Adds to growing portfolio of Yukon, NWT critical metals assets North of 60 Mining News – June 10, 2022
The Mactung project hosts hosts 33 million metric tons of indicated resource averaging 0.88% tungsten, a metal critical the United States, Canada, and European Union.
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Fireweed Zinc Ltd. has agreed to buy the Mactung tungsten project from the Northwest Territories government for C$15 million (US$11.8 million), an acquisition that further expands the company's growing portfolio of critical mineral assets.
Mactung lies within the traditional territories of the Kaska Dena and First Nation of Na-Cho Nyäk Dun, as well as the Sahtu Dene and Métis land claims settlement area of western Northwest Territories.
This critical metal property straddling the Yukon-Northwest Territories border hosts 33 million metric tons of indicated resource averaging 0.88% tungsten trioxide, making it one of the largest known undeveloped, high-grade tungsten-skarn deposits in the world.
Despite Mactung's world-class size and grade, along with being advanced well into permitting, the former owner of the project, North American Tungsten, fell into financial difficulties and filed for creditor protection before it could develop the mine that would have produced roughly 6,450 metric tons of tungsten per year.
The government of Northwest Territories acquired Mactung in 2015 and obtained a Class 4 Mining Land Use Approval for the tungsten mine project in 2020.
Fireweed has agreed to buy this property that borders the northeast side of its Macmillan Pass zinc-lead-silver property from the territorial government.
"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," said Fireweed Zinc CEO Brandon Macdonald. "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."
Under the agreement with Northwest Territories Fireweed will pay as much as C$15 million (US$11.8 million) if the project is advanced to the mine decision stage.
Upon signing a binding purchase agreement, Fireweed will make an upfront payment to the territorial government of C$1.5 million (US$1.2 million) and has agreed to pay another C$3.5 million (US$2.8 million) within 18 months, $5 million (US$3.9 million) upon announcing its intent to build a mine on either Mactung or Macmillan Pass and an additional C$5 million (US$3.9 million) if it announces plans to build a mine at Mactung.
Following final due diligence and signing of the definitive asset purchase agreement, Fireweed plans to complete validation programs on previous work in order to support a new mineral resource estimate for the project. The company intends to follow this work with a new preliminary economic assessment in 2023 that outlines plans for developing a mine at Mactung and can be used to evaluate potential future synergies with Macmillan Pass.
"We are excited to be advancing both projects under the Fireweed umbrella to not just maximize value for Fireweed shareholders, but to also create increased opportunities for local Indigenous groups and the people of both Yukon and Northwest Territories," said Macdonald.
Fireweed's agreement to buy Mactung comes only a month after staking Gayna River, another project in Northwest Territories enriched with critical minerals.
Lying roughly 180 kilometers north of Macmillan Pass, Gayna River is a highly prospective zinc-gallium-germanium-lead-silver project that was discovered in the 1970s and is the target of more than 28,000 meters of drilling completed by Rio Tinto.
"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," Macdonald added.
CORRECTION: Under North American Tungsten's mine plan, Mactung would have averaged roughly 6,450 metric tons of tungsten per year not the 750,000 metric tons previously stated in this article.
Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.
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