Madison Metals buys large antinomy project in Ontario’s Hemlo gold camp

Canadian junior Madison Metals (CSE: GREN) said on Monday it has acquired what it believes to be one of the country’s largest undeveloped antimony deposits in the Hemlo gold camp of Ontario.

The Howells Lake project comprises nearly 140 sq. km of mineral claims within the Thunder Bay mining district. The property already hosts significant gold mineralization that the company compares to the world-class Hemlo gold deposits. Antimony, a key mineral used in many military and high-tech applications, was also discovered in historical drilling for gold.

In a press release, Madison Metals CEO Duane Parnham said the Howells Lake project “has enormous potential to have real economic significance,” noting that the antimony price has tripled over the past year, largely sparked by increasing demand and the Chinese export restrictions that took effect in September.

The export restrictions, the company says, present a significant challenge for the global supply of antimony, as China accounts for nearly half 48% of the world’s production in 2023, while the Western nations have no new major projects under development.

Prior to the restrictions, antimony had already been placed high on the critical metals list of Canada, the US and the European Union.

Historic antimony resource

The first instance of high-grade antimony at Howells Lake was documented as mineralization in boulders during the 1940s. In the 1970s, the mineral was discovered in drill holes some 2 km away. The following years saw at least C$2 million spent in the project’s early exploration, but since then, no significant work has been done over the past 40 years.

A historic non NI-43-101-compliant resource (1977) reported by an Ontario resident geologist showed 1.7 million tonnes at 1.7% antimony, which would equal to approximately 51 million lb. of contained antimony. According to Madison, the property covers 20 km of favourable geology with little drilling outside this resource area.

To acquire a 100% interest in the project, the company will pay one vendor 50,000 common shares, while a second vendor will be paid C$25,000, issued 125,000 common shares on signing and receive three subsequent equal anniversary payments.

In addition, for claims that include the area covering the antimony deposit, Madison will issue to a third vendor a total of 4.5 million shares over a two-year period, including 2 million shares on signing. It will also enter into consulting contracts for drilling, geophysical surveys and geological services with the third vendor group.

All three vendors will be granted a 2% net smelter return royalty, with Madison retaining the option to buy back 1%.

“Expanding our portfolio to include this high-impact, high-grade project complements our existing uranium assets and positions us as a first mover in the space,” Parnham said.

The company currently holds two uranium exploration projects in Namibia, with a contained resource of approximately 9 million lb. in uranium oxides.

Shares of Madison Metals shot up 39% to C$0.28 late in the afternoon trading session, for a market capitalization of C$7.8 million ($5.5m).