Headwater Gold begins drilling at Spring Peak

Jul 22, 2024

2024-07-18 10:24 ET – News Release

Mr. Caleb Stroup reports

HEADWATER GOLD COMMENCES DRILLING AT SPRING PEAK PROJECT, NEVADA

Headwater Gold Inc. has commenced drilling at the Spring Peak project in Nevada. The program is designed to follow up on Headwater’s 2022 and 2023 drill programs, which discovered high-grade epithermal veins in two distinct target areas (see Headwater’s news release dated March 2, 2023).

Highlights:

Jurisdiction: Spring Peak is located in the Walker Lane belt of Nevada, adjoining Hecla Mining Company’s past-producing Aurora mine.
Drilling program: Up to approximately 7,000 metres of drilling are planned, utilizing a combination of diamond core and reverse circulation (RC) drilling.
Financing: The drill program is fully financed by Newmont Corp., pursuant to the option and earn-in transaction announced on Aug. 16, 2022.
Objectives:
- Test for extensions up dip and downdip from high-grade veins discovered by previous Headwater drilling at the Disco zone, which intercepted 34.72 metres grading 2.73 grams per tonne gold, including 15.92 g/t Au over 2.38 m and 10.43 g/t Au over 2.01 m (see Headwater’s new release dated Jan. 9, 2023);
- Test for along-strike extensions of high-grade mineralization within the Bear fault corridor, both to the southwest and to the northeast of the central Disco zone;
- Test multiple additional high-priority target areas on the property with initial scout drilling, including undrilled target areas on recently acquired private lands.

Caleb Stroup, president and chief executive officer of the company, stated: “We are very happy to kick off this fully funded drill program at Spring Peak with our partner Newmont. This year’s drilling represents a very exciting opportunity to extend zones of known high-grade mineralization and expand the footprint of exploration by testing new target areas with initial scout drilling. Approximately half of the planned 7,000 metres of drilling will be allocated to the Bear fault corridor, which hosts high-grade veins at the Disco zone and remains open along strike in both directions as well as up and downdip. The remainder of our planned drilling will be focused on initial tests of new high-priority target areas, including the first drilling on newly acquired private lands in the western portion of the land package. We will also look to drill the initial holes into several compelling targets just south of the Bear fault in newly recognized parallel fault structures. We believe this year’s program represents a great opportunity for the company to significantly advance the Spring Peak project and continue to build on quality results from our previous drilling.”

2024 drill program

The 2024 drill program is expected to consist of up to 7,000 metres of drilling over 20 to 25 holes, utilizing one core and one RC drill rig. The primary objectives of the drill program are to test for extensions of known mineralization along the Bear fault corridor and test multiple new targets across the property with initial scout drilling. Drilling is authorized for 2024 under existing drill permits with the U.S. Forest Service and the Nevada Bureau of Mining Regulation and Reclamation.

Disco zone

The Disco zone was discovered by Headwater in 2022 by drilling beneath a thick accumulation of unmineralized silica sinter at surface and hosts a series of mineralized epithermal veins at depth within a property-scale fault zone referred to as the Bear fault. The 2023 drill program expanded the known strike extent of the Disco zone to over 400 metres, with mineralization remaining open in all directions. Drilling to date in the Disco zone has intercepted multiple discrete veins with textures indicative of epithermal boiling, including ginguro banding, silica replacement of lattice-bladed calcite and vein sediments. Reinterpreted geophysical (CSAMT (controlled-source audio-frequency magnetotelluric) resistivity) data shows a strong association between silicification and epithermal mineralization and high apparent resistivity.

A primary objective of the 2024 drill program is to expand the Disco zone both up and downdip. Drill results from late in the 2023 drill program highlighted the up-dip potential, with drill hole SP23-32 intercepting 9.44 g/t Au over 3.66 m within a broader zone of 39.81 m grading 1.93 g/t Au near the top of the current drill pattern (see Headwater’s news release dated Feb. 13, 2024). Approximately 180 metres of vertical potential remains untested above drill hole SP23-32 within a strong coincidental CSAMT resistivity anomaly. Several planned holes have been designed to test this target in the 2024 program.

Bear fault stepout drilling

Multiple drill holes are planned to test for extensions of mineralization along a 1.5-kilometre segment of the Bear fault corridor, both northeast and southwest of the central Disco zone. Drilling to date has demonstrated the importance of the Bear fault structure as a fluid conduit at the Disco zone, highlighting potential for discovering extensions to the known high-grade mineralization or additional high-grade shoots.

Only one drill hole has intercepted the Bear fault outside of the main Disco zone. In 2023, stepout drill hole SP23-37 was completed approximately 400 m northeast of the main Disco zone on the Pioneer target below new surface sampling, which returned up to 3.61 g/t Au in rock-chip samples of veins with quartz-after-calcite and other epithermal vein textures.

This hole encountered sulphide-rich, silica-cemented breccias and quartz veins in the hangingwall of the main Bear fault structure, including a 58.98 m zone of anomalous gold with four assay intervals grading over one g/t Au at a vertical depth of approximately 350 metres. Up-dip and along-strike follow-up drill holes are proposed as part of the 2024 drill program on the Pioneer target.

Scout drilling

Approximately half of the planned 2024 drill program at Spring Peak will be focused on first-pass scout drilling of multiple high-priority target areas on the property, including targets on newly acquired private lands that have no prior drilling. The western portion of the Spring Peak project was recently acquired through two lease agreements with options to purchase private lands within the project area (see Headwater’s news release dated Nov. 1, 2023). In addition to potential long-term infrastructure optionality, these private lands host a number of high-priority exploration targets. A property-scale, northeast-trending structure known as the Bug fault is a primary focus for initial scout drilling on the private lands and occupies a favourable structural orientation, broadly parallel the trend of the Disco zone and the high-grade veins at the nearby Aurora mine complex. Epithermal alteration occurs over the exposed strike extent of the fault and a large, altered rhyolite dome intrudes the Bug fault in the western portion of the property. This dome hosts steam-heated epithermal alteration with abundant alunite alteration and elevated mercury geochemistry. Several drill holes are planned along an approximately 1.5 km strike extent of the Bug fault corridor.

Recent geological mapping, surface geochemistry and reinterpretation of CSAMT resistivity geophysics have also highlighted several additional new target areas in the core of the property. Northeast-trending (Disco zone and Aurora parallel) features will be the primary focus, including a strong CSAMT anomaly in the immediate hangingwall of Disco zone, which Headwater geologists interpret as a potential antithetic mineralized structure. Multiple additional parallel features in both the hangingwall and footwall of the Disco zone/Bear fault will also be tested.

About the Spring Peak project

The Spring Peak project is located in the Aurora mining district in the Walker Lane belt, west-central Nevada, approximately 50 km southwest of the town of Hawthorne. The project adjoins Hecla Mining Company’s past-producing Aurora mine complex, where existing infrastructure includes a 350-tonne-per-day mill, several production water wells and high-voltage three-phase power. Drilling at the Disco zone has confirmed the presence of high-grade gold mineralization, including significant intersections such as 15.92 g/t Au over 2.38 m and 10.43 g/t Au over 2.01 m within a broader zone of 2.73 g/t Au over 34.72 m and 9.44 g/t Au over 3.66 m within a broader zone of 39.81 m grading 1.93 g/t Au.

Headwater holds an option to acquire a 100-per-cent undivided interest in the Spring Peak project from Orogen Royalties, subject to retained royalties and subject to Newmont’s option to acquire up to 75 per cent of the project following certain expenditures and preparation of a prefeasibility study within a designated time frame.

About Headwater Gold Inc.

Headwater Gold is a technically driven mineral exploration company focused on the exploration and discovery of high-grade precious metal deposits in the western United States . Headwater is aggressively exploring one of the most well-endowed and mining-friendly jurisdictions in the world with a goal of making world-class precious metal discoveries. Headwater has a large portfolio of epithermal vein exploration projects and a technical team of experienced geologists with diverse capital markets, junior and major mining company backgrounds.

The company is systematically drill testing several projects in Nevada and in August, 2022, and May, 2023, announced significant transactions with Newmont, where it acquired a 9.9-per-cent strategic equity interest in the company and entered into earn-in agreements on several of Headwater’s projects.

Headwater is part of the NewQuest Capital Group, which is a discovery-driven investment enterprise that builds value through the incubation and financing of mineral projects and companies.

We seek Safe Harbor.

https://headwatergold.com/