NICKEL – MAKWA

Above: Map of southeast Manitoba showing the Makwa nickel project

Project Highlights

• Poised for discovery with a dominant land position in the highly prospective Bird River greenstone belt with a direct comparison to the “Ring of Fire”
• Makwa nickel project funded through $17 million option & joint venture agreement with Teck Resources
• The historical property boundary between Makwa and Gossan severely hampered exploration for high-grade massive sulfide deposits within an interpreted >5 km long feeder system prior to Grid consolidation in 2023
• Low project carrying costs 
• Exploration agreement in place with Sagkeeng First Nation

Above: Outline of claim tenure on the north and south arm of the Bird River Greenstone Belt

The Makwa Nickel Project Overview

The Makwa project is one of two copper-nickel-PGM properties owned by Grid and located in the Archean-age Bird River greenstone belt of southeastern Manitoba.  The project has excellent infrastructure, e.g., all season roads, local hydro-electric power, proximity to major trans-continental rail and trucking arteries.  The Bird River belt is a direct analogue of the Ring of Fire district in northwestern Ontario in terms of the variety of mineral deposit types and geology, scale and structure.  The primary target rocks at Makwa are ultramafic cumulates of the >30 km long Bird River Sill, which represents a dynamic intrusive complex featuring a wide range of intrusion shapes, sizes and structural associations.  Despite its excellent pedigree as a past nickel producer, it was not until 2023 - when Grid completed its consolidation of the nickel-copper sulfide properties in the belt, that a comprehensive district-scale magmatic sulfide exploration program could be enacted.  In particular, a historical property boundary severely hampered exploration for high-grade massive sulfide deposits within an interpreted >5 km long feeder system (the ‘ore fault corridor’).  Prior exploration efforts were also impaired by the limited depth of penetration of historical geophysical surveys.

The Makwa project features two past producing nickel sulfide mines, three pit-constrained nickel sulfide resources and numerous high-grade nickel- and/or copper-rich magmatic sulfide surface showings.  The Company recently published an updated pit-constrained mineral resource estimate for the Makwa deposit comprising 14.2 MMt of 0.75% Ni Eq grade including a higher-grade core of 4.8 MMt with 1.26% Ni Eq grade (see Micon International Technical Report, September 2024, available on SEDAR).   A key aspect of the Makwa mineralization are its high nickel and palladium tenors – making it very amenable to the production of a high-value nickel sulfide concentrate.

Several depositional models will help guide future exploration at the Makwa project including conventional basal-accumulation disseminated and local massive sulfide deposits; feeder-structure related high-grade massive sulfide deposits; and hydrothermal massive sulfide vein systems produced from interaction of magmatic Cu-Ni and volcanogenic Cu-Zn-Ag-Au sulfide mineralization.  The critical new discoveries needed to support a robust future mining operation will be based on a new bank of drill targets.  These targets will be defined by integrating historical and new geophysical and geochemical surveys with the use of leading-edge 3D analytics methods.   Teck and Grid jointly anticipate the launch of an initial drilling campaign that will focus on the discovery of structurally-controlled high-grade massive sulfide deposits.

Resource Estimate

The updated mineral resource estimate for the Makwa Project is provided in Tables 1 and 2, below.  The new estimate was prepared by Micon International Ltd. (‘Micon’) and is reported in accordance with National Instrument 43-101 (“NI 43-101”) standards. The current mineral resource was estimated by Micon using an updated drill hole database and new mineralization wireframes that capture all compliant historical drill hole data sets.  Block grade interpolation was performed using Kriging Neighborhood Analysis (KNA). The resource modeling was completed by Micon in accordance with both CIM Guidelines and the relevant parts of the JORC Code, and in keeping with regulatory requirements for the filing of technical reports for mineral resource estimates at both the TSX Venture Exchange and the Australian Stock Exchange (ASX).  Micon used metal equivalent grades as opposed to net smelter return values (used in the previous estimate – RPA Inc., 2014) to align with the standards for resource reporting on the ASX. 

The Technical Report incorporating the new resource estimate is accessible on SEDAR (www.sedar.com).

Table 1. Makwa Pit Constrained and Underground Resources as of December 31, 2023

*SR = strip ratio

Notes to Accompany the Makwa Resource Estimate:

1. The effective date of this Mineral Resource Estimate is December 31, 2023.
2. The MRE presented above uses economic assumptions for both, surface mining and underground mining.
3. The MRE has been classified in the Indicated and Inferred categories following spatial grade continuity analysis and geological confidence.
4. The calculated cut-off grades to report the MRE are dynamic in nature following metallurgical recovery curves, the average COG for Makwa is 0.30 % Ni in surface mining and 0.84 % Ni in underground mining.
5. The economic parameters used metal prices of US$9.0/lb Ni, US$3.75/lb Cu, US$23.0/lb Co, US$900/oz Pt, US$1,400/oz Pd and US$1,750/Au with specific metallurgical recovery curves detailed in tables 4.14 and 14.15 of the technical report (50-68% nickel recovery to 10% nickel concentrate based on average grades and over 70% recovery for highest grade (+1% Ni) blocks at Makwa), a mining cost of US$3.5/t in surface and US$80.0/t in underground. Processing cost of US$15/t and a General & Administration cost of US$3.2/t.
6. For surface mining the open pit at Makwa uses a slope angle of 53°.
7. The block models for Makwa are rotated and use a block size of 10 m x 5 m x 5 m with the narrow side across strike (North-South).
8. The open pit optimization uses a re-blocked size of 10 m x 10 m x 10 m and for the underground the optimization uses stopes of 20 m long by 20 m high and a minimum mining width of 3 m.
9. Messrs. Alan J. San Martin, MAusIMM(CP) and Charley Murahwi, P.Geo. from Micon International Limited are the Qualified Persons (QPs) for this Mineral Resource Estimate (MRE).
10. Mineral resources unlike mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues.
11. The mineral resources have been estimated in accordance with the CIM Best Practice Guidelines (2019) and the CIM Definition Standards (2014).
12. Totals may not add correctly due to rounding.
13. Equivalent (Eq) Grade Calculations: Makwa NiEq = Ni% + ((Cu% x CuR x CuP) + (Co% x CoR x CoP) + (Pt g/t x PtR x PtP) + (Pd g/t x PdR x PdP))/(NiR x NiP); NiEQ = nickel equivalent grade.  R = metal recovery.  P = metal price.
14. Metallurgical recoveries range as follows using input grades at the cutoff grade (low end) and 2 times the average open pit resource grade (high end):  Makwa:  Ni: 36 to 86%; Cu: 85.6% (invariant); Co: fixed to nickel recoveries; Pd: 59 to 90% (capped); Pt: 39 to 90% (capped).

Table 2. Contained Metal Values for the Open Pit Resources at the Makwa Property (Indicated Category only)

The open pit resources at Makwa include 14.2 million tonnes in the indicated category with 0.48% Ni, 0.11% Cu, 0.02% Co, 0.37 g/t Pd and 0.10 g/t Pt (0.75% nickel equivalent grade).  The Makwa deposit is subdivided into a central, higher-grade zone (‘HG1’) and a flanking (both hanging-wall and footwall) lower-grade (‘LG1’) zone.  The new resource estimate includes 4.8 million tonnes of the HG1 zone grading 0.89% Ni (1.26% nickel equivalent grade).

The previous resource estimate for the Makwa/Mayville project was published by RPA Inc. (2014) and supported a Preliminary Economic Assessment based on two open pit mines feeding a central concentrator to be located at the Mayville property.   Low base metal prices during the period of 2014 to 2020 precluded any significant new development activity and drilling at the Project.  However, with an improved outlook for copper prices and the increasing strategic importance of nickel as a critical metal, the Project ranks favourably for future exploration and development.

Compared to the previous published resource estimate for the Mawka/Mayville project (RPA Inc., 2014), the combined open pit resources (indicated category) increased by 12.4 million tonnes or 36.8%.  This increase is largely attributable to the inclusion of recent infill drilling (Makwa – 2022), improved metallurgical recoveries from testwork completed after the previous resource estimate was published, and a more favourable US dollar to Canadian dollar exchange rate.

Makwa Deposit

The Makwa deposit is a conventional, basal-contact related, Ni- and Pd-rich disseminated magmatic sulfide deposit.  The steep south-dipping and west-plunging Makwa deposit has a minimum strike length of 1.1 km, an average vertical depth of ~350 metres and an average width of 30-50 metres.  The Makwa deposit remains open along strike to the east and partially down-dip below its currently defined vertical extent. The deposit was briefly mined from a shallow open pit by a subsidiary of Falconbridge Ltd. in 1974.  It was the subject of a standalone Prefeasibility Study completed in 2008 (Micon International) for the mining and production of nickel concentrate for sale to a smelter.

The Micon resource estimate discussed here subdivides the deposit into a central higher-grade zone (HG1) and a flanking lower-grade zone (LG1).  The metal tenor in both zones is very similar, such that the Ni (and Pd) grades are strongly correlative with the total amount of sulfide present.  Localized high-grade nickel mineralization is present in associated with narrow lenses of net-textured and semi-massive sulfides

Figure 2.  Makwa Long Section (looking north) showing drill hole traces and mineralization block model

Figure 3: Representative cross section, looking west, showing the current Micon block model coded to nickel grade, the HG1 and LG1 zone boundaries, and selected length-weighted interval assays for drill holes captured on this section.