(TheNewswire)
Vancouver, British Columbia – TheNewswire - January 23, 2023: Headwater Gold Inc. (CSE:HWG) (OTC:HWAUF) (the"Company" or "Headwater") is pleased to provide an exploration update on the Midas Northproject located in Elko County, Nevada. Headwater’s Midas Northexploration program is fully funded during the earn-in phase byNewcrest Mining Limited (“Newcrest”), pursuant to the earn-inagreement announced on August 16, 2022.
Highlights
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Headwater has defined multiple high-priority drilltargets located directly on trend north of Hecla Mining Company’s(“Hecla”) past producing Midas high-grade mine complex;
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The Company interprets the project to represent a fullypreserved epithermal system with potential for high-grademineralization at depth below broad areas of favourablealteration;
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CSAMT geophysical surveys have identified severalhigh-resistivity zones interpreted to represent silicification andpossible feeder structures;
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Radiometric survey results show both a broadradiometric low and linear radiometric highs interpreted to representstructurally controlled zones of alteration potentially associatedwith mineralized epithermal feeder structures;
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An aeromagnetic survey has highlighted several linearmagnetic lows interpreted as corridors of structurally controlledmag-destructive alteration which may also indicate feeder structuresat depth; and,
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A final drill plan is currently being developed for amulti-rig maiden drill program scheduled to commence in Q2.
Caleb Stroup, the President and CEO of the Company,states: “Since signing theearn-in agreement with Newcrest in August 2022, we have been buildingan extensive geological and geophysical dataset at Midas North. Thegoal has been to apply the very best geoscientific tools available toidentify feeder structures which have the potential to host high-gradeepithermal gold-silver mineralization at depth below the extensivezone of alteration observed at surface. In aggregate, thegeophysical studies have done a phenomenal job of helping the Companyunderstand the subsurface geology and have been instrumental inidentifying several high-priority target areas for drill testing inthe upcoming field season. The Midas mine complex located immediately to thesouth serves as a clear geologic analog, with over two million ouncesof gold and over 25 million ounces of silver historically producedfrom high-grade epithermal veins at Midas between 1998 and2019 (1 2) by operators such asFranco-Nevada, Newmont and Hecla. ”
Figure 1: Map of the Midashigh-grade vein district in northern Nevada. Headwater Gold’s MidasNorth project adjoins Hecla’s past producing Midas Mine complex,encompassing another large epithermal alteration cell north along thetrend of the Midas Mine.
Midas North GeophysicalSurveys:
The results of the geophysical surveys confirm theutility of using magnetics, radiometrics, gravity and CSAMTresistivity, together with geology, to generate high-quality drilltargets at Midas North below the broad area of favourable epithermalalteration outcropping at surface.
The 2022 geophysical programs consisted of:
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A controlled-source audio-frequency magnetotelluric(“CSAMT”) resistivity survey totalling 36.3 line-kilometres(“line-km”) on eight parallel 400 metre (“m”) spacedprofiles;
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Helicopter airborne magnetic and radiometric surveystotalling 357 line-km completed at 100 m spacing totalling 32.5km ; and,
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A ground gravity survey consisting of 767 stations on a200 m grid to 400 m grid regionally, with a total survey footprint of114 km
Figure 2: (A) CSAMT geophysicsapparent resistivity profile with (B) Headwater’s working geologicalmodel and preliminary drill targets in the Big Opal target area. SeeFigure 3 for plan map indicating the CSAMT line position andgeological cross section location.
Figure 3: Midas North property maphighlighting the principal alteration zones, target areas andapproximate geophysical survey footprints shown in detail in Figures5, 6 and 7.
Geophysical Targets Areas:
Headwater has identified multiple drill targets byanalyzing the multi-parameter geophysical data described above. Theprincipal targets contain geophysical and geological characteristicsindicating potential to host kilometre-scale feeder zones at depths of200m to 400m below the outcropping mapped sinters and other high-levelhot-spring-type alteration mapped at surface.
The principal targets are interpreted asfollows:
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Big Opal Sinter Target NNW-striking sub-vertical resistivity break beneathoutcropping vent facies sinter deposits with interpreted mafic sill atdepth. Strong geological similarities toHecla’s recent Green Racer Sinter vein discovery on the adjacentMidas Mine complex.
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Big Opal Fault Target Kilometre-scale NNW-striking resistivity break at themargin of a large resistivity high (Big Opal Resistor) interpreted asa thick water table silica blanket.
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Big Opal Resistor Target : High-angleresistivity break beneath the Big Opal Resistor.
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Jo Belle Fault Target District-scale fault associated with kilometre-scale,strongly resistive CSAMT feature (Nevada Grande Resistor). Thestratigraphic offset and fault orientation are considered geologicallycomparable to the high-grade Colorado Grande vein in the main Midasdistrict. Strong illite-adularia alteration is interpreted from aNNW-trending radiometric high (potassium channel) along the faulttrace.
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Nevada Grande Resistor Large resistor with approximately 2 kilometres of strikeextent in the hanging wall of the Jo Belle fault interpreted topotentially represent a second locus of fluid flux and vein formationseparate from the Big Opal structural corridor.
Figure 4: 3D oblique view of CSAMTgeophysical profiles, high-resistivity anomalies, interpreted faultsand surface alteration features. The resistivity volum es shownare interpreted to representextensive zones of pervasive silicification with potential forepithermal feeder zones at depth. CSAMT sections are on 400 m spacedlines. See Figure 2 for resistivity scale.
CSAMT Survey
The CSAMT data collected by the Company has provenparticularly effective for mapping the subsurface geometries ofinterpreted silica alteration beneath areas of high-level silica andsteam-heated clay alteration, interpreted to represent the upperportion of a completely preserved epithermal system. Multiple high-angle resistivity breaks occur adjacent to andbeneath shallow, tabular resistive bodies, each with over 2 kilometresof strike length (Figures 2, 3 and 4).
Airborne Radiometric Survey
Radiometric survey results and potassium data inparticular show discrete linear radiometric highs which may representcorridors of illite-adularia alteration that are subparallel to thefeeder structures interpreted from the CSAMT data. The potassiumdata additionally reveal a broad, spatially continuous low coincidentwith the principal area of strong surface alteration (Figure 5)potentially attributable to a broad zone of argillic alteration.
Figure 5: Radiometric surveypotassium channel results showing central radiometric low, potentiallyattributable to extensive clay alteration and discrete linearradiometric highs which may represent structurally controlled zones ofillite-adularia alteration.
Airborne Magnetic Survey
Strong contrasts in magnetic response reveal numerousNNW-trending linear magnetic lows, as well as a broad magnetic high inthe Big Opal area (Figure 6). The linear magnetic low features are consistent with magnetite-destructive alteration of the host volcanic rocksalong structural corridors which potentially focused geothermalfluids. Several discrete magnetic highs elsewhere on the property correspond with outcropping maficsills. The large, low-amplitude magnetic high is interpreted byHeadwater as a possible buried mafic intrusion, analogous in characterto the sill-dike complexes spatially and temporally associated withhigh-grade vein deposits elsewhere in northern Nevada, such as Midas,Hollister, Fire Creek and Mule Canyon 1 .
Figure 6: Aeromagnetic geophysicalsurvey highlighting several linear zones of magnetite-destructivealteration interpreted to represent potential feeder structures. Thestrong magnetic signature beneath the Big Opal Sinter area isinterpreted as a possible mafic sill which are common adjacent to thehigh-grade veins in the historic Midas district and elsewhere inNevada 1 .
Gravity Survey
The core of the property is characterized by a broadgravity low which suggests a possible zone of pervasive argillicalteration in the surrounding volcanic host rock. The gravity lowbroadly overlaps with the footprint of a radiometric low andencompasses the areas of highest intensity alteration mapped at surface. The NNW elongation of thegravity low is consistent with property-wide structural trendsdetected by other geophysical surveys and surface mapping.
Figure 7: Residual gravity imageshowing a broad embayment in the central project area interpreted tocorrespond to the footprint of intense clay alteration.
About the Midas North Project:
Headwater’s 100% owned and royalty-free Midas Northproject in Nevada adjoins Hecla Mining Company’s (NYSE: HL) pastproducing Midas Mine complex and covers a large hydrothermalalteration cell, extending at least 4 kilometres in strike and 1kilometre in width. Rock chip and stream sediment samples collectedby the Company from the project area have highlighted several priorityareas of anomalous precious metal values with highly anomalous valuesof epithermal pathfinder elements (see Headwater news release datedOctober 4, 2021). Extensive epithermal alteration exists on theproject, including widespread zones of high-level chalcedonic toopaline silica flooding, clay alteration and local sinter formation,including fossilized geyser vents. The projecthas seen very limited historic exploration with no apparent historyexploration drilling. The Company believes the project has potentialfor high-grade epithermal mineralization at depth similar to thatfound at Hecla’s adjacent Midas Mine complex 1 .
Earn-in Agreement withNewcrest:
Newcrest is sole funding a firm minimum commitment ofUS$2,000,000 in exploration expenditures over a two-year period fromAugust 2022 on the Midas North project or will pay the difference toHeadwater.
During the staged earn-in phase, Newcrest has the rightto earn up to an initial 65% interest in the Midas North project bysole funding exploration expenditures (inclusive of the minimumcommitment) of US$30,000,000 over a 6-year period.
Newcrest retains the further right to earn anadditional 10% interest in the project (for a total interest of 75%)by ceding a 2% net smelter return royalty to Headwater subject tocertain partial buydown rights and completing a Pre-Feasibility Study,solely funded by Newcrest and which includes a minimum 1.5 millionounce gold or gold-equivalent resource within an additional 24-monthperiod.
The Midas North project is one of four Headwaterprojects under earn-in agreements with Newcrest (see news releasedated August 16, 2022 for information on all Newcrest earn-inagreements).
About Headwater Gold:
Headwater Gold Inc. (CSE: HWG, OTCQB: HWAUF) is atechnically-driven mineral exploration company focused on theexploration and discovery of high-grade precious metal deposits in theWestern USA. Headwater is aggressively exploring one of the mostwell-endowed and mining-friendly jurisdictions in the world with agoal of making world-class precious metal discoveries. Headwater hasa large portfolio of epithermal vein exploration projects and atechnical team comprised of experienced geologists with diversecapital markets, junior company and major mining company experience. The Company is systematically drill testing several projects inNevada, Idaho, and Oregon and in August 2022 announced a significanttransaction with Newcrest Mining Limited where Newcrest acquired a9.9% strategic equity interest in the Company and entered into earn-inagreements on four of Headwater’s projects.
For more information, please visit the Company'swebsite at www.headwatergold.com .
On Behalf of the Board ofDirectors
Caleb Stroup
President and CEO
+1 (775) 409-3197
For further information, please contact:
Brennan Zerb
Investor Relations Manager
+1 (778) 867-5016
Qualified Person
The technical information contained in this newsrelease has been reviewed and approved by Scott Close, P.Geo (158157),a “Qualified Person” (“QP”) as defined in National Instrument43-101 – Standards of Disclosure for Mineral Projects.
1 TheMidas North project owned by the Company hosts exploration targetswith no known resources or reserves. Gold mineralization on Hecla’s adjacent Midas MineComplex and high-grade vein deposits elsewherein northern Nevada including Hollister, Fire Creek and Mule Canyondoes not indicate similar mineralization is present on the Company’sMidas North project.
2 Goldstrand, P.M., and Schmidt, K.W., 2000, Geology,mineralization, and ore controls at the Ken Snyder gold-silver mine,Elko County, Nevada, in Cluer, J.K., Price, J.G., Struhsacker, E.M.,Hardyman, R.F., and Morris, C.L., eds., Geology and Ore Deposits 2000:The Great Basin and Beyond: Geological Society of Nevada SymposiumProceedings, May 15-18, 2000, p. 265-287.
Forward-Looking Statements:
This news release includes certainforward-looking statements and forward-looking information(collectively, “forward-looking statements”) within the meaning ofapplicable Canadian securities legislation. All statements, other thanstatements of historical fact, included herein including, withoutlimitation, statements regarding future capital expenditures,exploration activities and the specifications, targets, results,analyses, interpretations, benefits, costs and timing of them,Newcrest’s anticipated funding of the earn-in projects and thetiming thereof, and the anticipated business plans and timing offuture activities of the Company, are forward-looking statements.Although the Company believes that such statements are reasonable, itcan give no assurance that such expectations will prove to be correct.Often, but not always, forward looking information can be identifiedby words such as “pro forma”, “plans”, “expects”,“may”, “should”, “budget”, “scheduled”,“estimates”, “forecasts”, “intends”, “anticipates”,“believes”, “potential” or variations of such words includingnegative variations thereof, and phrases that refer to certainactions, events or results that may, could, would, might or will occuror be taken or achieved. Forward-looking statements involve known andunknown risks, uncertainties and other factors which may cause theactual results, performance or achievements of the Company to differmaterially from any future results, performance or achievementsexpressed or implied by the forward-looking statements. Such risks andother factors include, among others, risks related to the anticipatedbusiness plans and timing of future activities of the Company,including the Company’s exploration plans and the proposedexpenditures for exploration work thereon, the ability of the Companyto obtain sufficient financing to fund its business activities andplans, the risk that Newcrest will not elect to obtain any additionalinterest in the Projects in excess of the minimum commitment, theability of the Company to obtain the required permits, changes inlaws, regulations and policies affecting mining operations, theCompany’s limited operating history, currency fluctuations, titledisputes or claims, environmental issues and liabilities, as well asthose factors discussed under the heading “Risk Factors” in theCompany’s prospectus dated May 26, 2021 and other filings of theCompany with the Canadian Securities Authorities, copies of which canbe found under the Company’s profile on the SEDAR website atwww.sedar.com.
Readers are cautioned not to placeundue reliance on forward-looking statements. The Company undertakesno obligation to update any of the forward-looking statements, exceptas otherwise required by law.
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