Mr. Caleb Stroup reports

HEADWATER GOLD REPORTS DRILL RESULTS FROM INITIAL DRILLING ON ITS MIDAS NORTH PROJECT, NEVADA

Headwater Gold Inc. has released assay results from the maiden drill program at its Midas North project, Nevada. Drilling was fully financed by a subsidiary of Newmont Corp., pursuant to the option and earn-in agreement announced on Aug. 16, 2022.

Highlights:

• The Midas North project hosts a large, previously undrilled epithermal alteration cell in the northern Midas district, Nevada, located approximately 13 kilometres north of Hecla Mining Company's past-producing Midas mine;
• Nine widely spaced scout drill holes were completed by Headwater totalling 4,202 metres, designed to test six target areas. Epithermal veining and alteration were encountered in multiple target areas across the property;
• Drill hole MN23-02 returned 47 grams per tonne (g/t) silver (Ag) over 9.14 m below the Big Opal sinter and drill hole MN23-06, targeting the Jo Belle fault, intersected 0.51 g/t Au over 1.52 metres;
• First-pass evaluation of initial target areas at Midas North was successful in identifying mineralized epithermal veining and favourable alteration at depth, providing critical vectors to guide future drilling on the property targeting high-grade gold in mineralized structures;
• The company continues to review data in consultation with earn-in partner Newmont to prioritize potential follow-up work on the project.

Caleb Stroup, the president and chief executive officer of the company, states: "We are very encouraged by the results of our initial scout drill program at Midas North, which constituted the first known drilling on the property. This first-pass program has confirmed that alteration and epithermal veining persist at depth below surface alteration, and has identified anomalous precious metals at depth in multiple areas. The Big Opal and Jo Belle fault corridors exhibit the most consistent and intense alteration with several intersections of anomalous precious metals, including 47 g/t silver over 9.1 m below the Big Opal sinter in drill hole MN23-02. Our geologists are also highly encouraged by the initial core intersection of the Big Opal fault target, where drill hole MN23-04 intercepted a fault-hosted epithermal quartz vein with abundant quartz after bladed calcite textures and weak banding of chalcedonic quartz. These vein textures and associated alteration demonstrate the presence of a structurally hosted epithermal cell that experienced epithermal boiling conditions favourable for high-grade precious metal mineralization. Despite the low tenor of the gold values, the company considers the presence of epithermal quartz veins highly significant. The wide-spaced pattern of holes (up to one km spacing) has significantly increased our understanding of the subsurface geology, and provided clear vectors toward at least two priority areas to focus follow-up work and continue to explore for high-grade gold mineralization."

Two thousand twenty-three drill program

The company utilized a combination of diamond core and reverse circulation (RC) drilling at Midas North to complete nine wide-spaced drill holes totalling 4,202 metres. Drilling intersected epithermal veining and alteration in multiple target areas. This maiden drill program consisted of drill holes designed to test the large epithermal alteration cell on the property, and a variety of targets generated from initial geologic and geophysical work (see news release dated April 20, 2023).

The primary objective of the program was to perform a first-pass evaluation of six discrete target areas at multiple elevations, to assess the strength of epithermal alteration at depth and ultimately guide future drilling on the property toward the most favourable structures. Drilling confirmed the presence of widespread epithermal alteration and identified anomalous precious metals at depth in multiple areas. Geologic logging has resulted in a much-improved understanding of the subsurface stratigraphy, and identified the presence of the Esmeralda, Elko Prince and June Belle formations at depth, which are favourable hosts of mineralization at the past-producing Midas mine to the south. In addition, a number of prospective structures identified through geologic mapping and geophysical analysis (see news release dated April 21, 2022) were intercepted as predicted from geologic modelling.

Scout RC drill hole MN23-02 was drilled below an outcropping zone of opaline silica and sinter with fossilized geyser vents, within the Big Opal fault corridor. This drill hole intersected 47 g/t silver over 9.14 m from 371.86 m to 381 m in a structurally controlled high-resistivity feature underlying the silica sinter exposure. The mineralized interval consists of quartz-calcite-sulphide veining hosted in a gabbroic sill, which typically acts as a poor host for mineralization within the Midas district. This intercept represents the most significant precious metal anomaly identified on the property to date and highlights the potential for epithermal vein-style gold mineralization within more favourable host units laterally along strike or at depth.

Drill hole MN23-04, located approximately one kilometre south of hole MN23-02 along the Big Opal fault corridor, intersected a three-metre-wide fault zone hosting a quartz vein with quartz-after-calcite lattice textures. Lattice-bladed and weakly banded quartz veining is consistent with epithermal boiling as the product of a high-energy geothermal system, and implies potential for mineralized feeder structures deeper into the boiling zone at depth or laterally along strike. This vein returned highly anomalous pathfinder geochemistry with weakly anomalous gold and silver values. The significant strike length between low-grade mineralization encountered in hole MN23-02 to the northwest and epithermal veining in hole MN23-04 to the southeast indicate over a kilometre of prospective and untested strike extent along the Big Opal fault corridor, as corroborated by anomalous surface and drill hole pathfinder element geochemistry across the area.

The westernmost scout RC drill hole, MN23-06, targeted the district-scale Jo Belle fault and intersected 0.51 g/t Au over 1.52 metres from 225.55 m to 227.08 m within the fault zone. This low-grade precious metal intercept, along with highly anomalous mercury and arsenic values across a broad interval of MN23-06, suggests alteration is strongly fault controlled. More drilling is required to adequately test this structurally controlled alteration along strike across the western portion of the property.

The 2023 drill program at Midas North also demonstrated the utility of controlled-source audio-frequency magnetotelluric (CSAMT) resistivity geophysical interpretation for target generation at the property. Geologic mapping and modelling efforts are limited by relatively poor preservation of outcrop exposures and a pervasive silica altered alteration cap. Interpretation of CSAMT has assisted with mapping of large-scale structures and prospective high-resistivity features at depth. Nearly all the 2023 drill holes which encountered fault zones and associated epithermal pathfinder element geochemistry were predicted by the geophysics, demonstrating the efficacy of this approach at the project. Stratigraphic and structural controls from the broadly spaced drill holes will provide significantly improved constraints for the company's evolving geologic model, and will greatly aid future exploration. Headwater geologists believe the fault-hosted epithermal alteration and veining encountered in multiple drill holes suggest the potential for high-grade mineralization within the refined target areas remains.

About the Midas North project

Headwater's 100-per-cent-owned and royalty-free Midas North project adjoins Hecla Mining Company's past-producing Midas mine complex to the north, and covers a large hydrothermal alteration cell, extending at least four kilometres in strike and one kilometre in width. Geologic mapping, surface sampling and geophysics completed by the company in the project area have highlighted several priority areas to explore for high-grade epithermal veins at depth. Extensive epithermal alteration exists on the project, including widespread zones of high-level chalcedonic to opaline silica flooding, clay alteration and local sinter formation with fossilized geyser vents. The project has seen very limited historic exploration with no documented exploration drilling. Midas North is subject to Newmont's option to acquire up to a 75-per-cent interest in the project following expenditures totalling $30-million (U.S.) and the completion 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 as well as junior and major mining company backgrounds. The company is systematically drill testing several projects in Nevada, Idaho and Oregon. In August, 2022, and May, 2023, the company made significant transactions with Newcrest Mining, where Newcrest 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 company that builds value through the incubation and financing of mineral projects and companies.

We seek Safe Harbor.