Fireweed Metals increases Lundin-backed financing, stock hits 52-week high

Due to strong investor interest, Yukon-focused critical minerals explorer Fireweed Metals‘ (TSXV: FWZ; OTC: FWEDF) says it will increase its previously announced financing to about $35 million.

Earlier in the week, the company formerly known as Fireweed Zinc announced a private placement to raise aggregate proceeds of $27.5 million. The financing consists of three parts: 28.3 million common shares at 74¢ per share, 3 million flow-through (FT) shares at 88¢, and 3.3 million “premium” FT shares at $1.20 each.

As disclosed in a news release Monday, this financing round included lead orders by members of the Lundin family, who did not hold any shares previously, as well as other key shareholders. The Lundins’ participation in the offering would make them collectively Fireweed’s largest shareholder. Orders from other key shareholders are expected to exceed $5 million.

Since that announcement, the financing has attracted plenty of investor interest, as the share placement has been substantially oversubscribed. As a result, Fireweed will now issue 31.2 million common shares, 4.9 million FT shares and 6.3 million premium FT shares, all at the same price, for proceeds of up to $34.9 million.

The funds will provide capital for what the company calls the “most significant” exploration program ever initiated on its projects in northern Canada, headlined by the district-scale Macmillan Pass project located about 372 km east of Whitehorse.

This 940-sq.-km property is host to the Tom and Jason zinc-lead-silver deposits, which together contain 11.21 million tonnes of indicated resources at 6.59% zinc, 2.48% lead and 21.33 grams silver per tonne. There is also  39.47 million tonnes in inferred resources at 5.84% zinc, 3.14% lead and 38.15 grams silver per tonne. This mineral estimate, completed in January 2018, puts Macmillan Pass among the world’s most significant zinc resources.

Other discoveries on the property include Boundary Zone, Boundary Zone West, Tom North Zone and End Zone, which have significant zinc-lead-silver mineralization drilled but not yet classified as mineral resources.

The Nidd property, acquired in November 2018, hosts established zinc mineralization in Boundary Zone, where historic drilling included intersections of 224 metres at 2.5% zinc and 0.3% lead, including 4.5 metres of 16.4% zinc, demonstrating potential for both bulk tonnage open pit and high-grade underground mineralization.

“We have been impressed with the progress made to date,” Adam Lundin commented on behalf of the Lundin family. “With the experience we have in the sector, opportunities like this seldomly come around and we view Fireweed as a district scale opportunity. The recent discovery at Boundary Zone adds to the solid mineralization characteristics of the Tom and Jason deposits.”

The Macmillan Pass project also includes large blocks of adjacent claims with known showings and significant upside exploration potential. The 2022 drill program is now complete, with assay results being announced as they are received and interpreted.

Next to Macmillan Pass, Fireweed is also looking to develop the Mactung tungsten and Gayna River zinc-lead-gallium-germanium projects.

The Mactung property currently hosts one of the largest and highest-grade tungsten deposits in the world, containing historic indicated resources of 33 million tonnes grading 0.88% tungsten trioxide plus inferred resources of 11.8 million tonnes grading 0.78% tungsten trioxide. The Gayna River project hosts extensive critical minerals mineralization, as outlined by 28,000 metres of historical drilling by Rio Tinto.

Shares of Fireweed Metals soared to a 52-week high of 93¢ just after noon in Toronto Wednesday following the latest announcement, placing the company’s market value at $84.5 million. The stock ranged between 50¢ and 88¢ during the past 52-week period.