Mr. Caleb Stroup reports

HEADWATER COMMENCES DRILLING ON TJ PROJECT AND PROVIDES UPDATE ON SPRING PEAK AND LODESTAR PROJECTS, NEVADA

Headwater Gold Inc. has commenced the maiden drill program on its 100-per-cent-owned TJ project located in northeastern Nevada and has provided an update on the Spring Peak and Lodestar projects, which are being explored in partnership with Newmont Corp. through earn-in agreements announced on Aug. 16, 2022, and May 9, 2023.

Highlights:

• TJ drilling program:
  • Approximately 2,000 metres of drilling are under way on Headwater's 100-per-cent-owned TJ project.
  • This maiden drill program will test multiple targets for high-grade epithermal veins at depth beneath outcropping silica sinter and downdip of historic shallow drill holes that encountered broad zones of silicification, epithermal alteration and anomalous gold.
• Spring Peak drilling completed:
  • Drilling activities have concluded for the field season at the Spring Peak project. Eighteen holes totalling 6,874 metres were completed, with a focus on scout drilling in new target areas. Results from nine scout holes have been received, including several zones of anomalous gold and pathfinder elements in new target areas.
• Lodestar drilling update:
• • Receipt of the Lodestar drilling permit has been delayed due to staffing shortages within the U.S. government regulatory agency. Permit approval and drilling are now expected in spring of 2025.

Caleb Stroup, president and chief executive officer of the company, stated: "We are very excited to launch the maiden drill program on our TJ project in Nevada, which has quickly become one of our top priorities. With well-preserved silica sinter at surface and compelling resistivity targets at depth, our geologists see strong parallels to our high-grade discovery at Spring Peak and have significantly upgraded the target's potential since acquiring the project just over a year ago.

"In parallel, we have completed drilling for the year on the Spring Peak project and received assays from nine initial scout holes. Several of these holes encountered zones of anomalous gold mineralization and key pathfinder elements across new target areas. We are encouraged by these initial results and the remaining assays will clarify the significance of these new zones within the context of the broader project.

"While we initially planned to drill the Lodestar project this fall, permitting delays have shifted that program to spring 2025. Funding for the planned program from Newmont remains fully committed under the $2-million minimum spend component of the Lodestar earn-in agreement, ensuring no material impact on our broader exploration strategy."

2024 TJ drill program

Headwater's maiden drill program at TJ is under way and is expected to consist of approximately five to seven reverse circulation (RC) drill holes ranging from 250 metres to 400 metres in depth. The primary objective of the drill program is to test for high-grade veins at depth along multiple subparallel structures in the core of the epithermal alteration cell. Shallow historic drilling targeting near-surface oxide mineralization encountered broad zones of silicification, epithermal alteration and anomalous gold in this area but did not penetrate to sufficient depths to test for potential high-grade feeder structures. The majority of historic holes were vertical and did not drill to depths beyond 150 metres. Several of the historic holes encountered anomalous gold values (greater than 0.1 gram per tonne gold) with some ending in mineralization.

Headwater's drilling is targeting depths of approximately 175 metres to 250 metres vertically beneath the silica sinter exposed at the surface to test for high-grade epithermal veins within a potential epithermal boiling zone.

If RC drilling cannot reach target depths due to drilling conditions or groundwater inflows, the holes will be temporarily cased and completed with a diamond core drill in the spring of 2025.

2024 Spring Peak drill program

The 2024 drill campaign at Spring Peak consisted of 18 holes totalling 6,874 metres, with assays received for the first nine holes and results pending for the remaining nine. Several scout holes targeted new structures parallel to the Disco zone with encouraging initial results, albeit generally with low-level gold. Drill hole SP24-47 intersected broad zones of low-level gold mineralization, including 76.2 metres grading 0.16 gram per tonne gold, with an included interval of 4.57 metres at 0.70 gram per tonne gold. Preliminary interpretations suggest this zone may represent a parallel structure to the Disco zone in the Bear fault footwall. The scout program also marked the first drill test of targets on recently acquired private lands. In this area, RC hole SP24-49 targeted the Bug fault corridor and intercepted 2.25 grams per tonne gold over 1.52 metres within a zone of adularia-sulphide veining.

The remaining assays, which focus more heavily on the Disco zone and Opal Ridge target areas, are expected in the coming weeks. Drilling at the Disco zone targeted both up-dip and downdip extensions while scout holes at Opal Ridge followed up on previous high-grade intercepts, including 1.52 metres at 16.4 grams per tonne gold.

Lodestar drill program

On April 3, 2024, the company announced a planned drill program at the Lodestar project, targeting high-grade precious metal in steeply dipping feeder structures beneath the Zodiac sinter target. This program will be financed by Newmont under the $2-million minimum commitment component of the Lodestar earn-in agreement (see news release dated March 7, 2023) and aims to drill up to 3,500 metres across 10 to 15 holes. Receipt of the necessary drill permit was anticipated by late 2024; however, unforeseen delays due to staffing shortfalls within the U.S. Forest Service have extended the expected approval timeline. Drilling is now anticipated to commence in the spring of 2025, by which time the company expects the required permit to be in place.

The Zodiac target remains a high-priority target within the Headwater portfolio and consists of a prominent silicified and brecciated ridgeline capped by a silica sinter similar in character to the sinter exposed above the Disco zone discovery at the company's Spring Peak project. In addition to the main feeder target, scout drill holes are planned to test under-cover geophysical targets adjacent to the exposed sinter, beneath a thin veneer of postmineral basalt.

About the TJ project

The TJ project is located on BLM land in an underexplored area of northeastern Nevada, approximately 25 kilometres southeast of the town of Jackpot. The project area contains indications of a fully preserved epithermal system, including a thick and laterally extensive accumulation of silica sinter and water table silica in the core of the property. Epithermal alteration is localized along a series of steeply inclined faults that bound a graben basin filled with Miocene-age sedimentary rocks. Limited historic exploration at the property included shallow RC drilling that confirmed the presence of a broad zone of high-level epithermal alteration but did not test for high-grade feeder veins at depth.

Headwater holds an option to acquire a 100-per-cent undivided interest in the TJ project from a private vendor.

About the Spring Peak project

The Spring Peak project is located in the Aurora mining district in the Walker Lane belt in western-central Nevada, approximately 50 kilometres 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 grams per tonne gold over 2.38 metres and 10.43 grams per tonne gold over 2.01 metres within a broader zone of 2.73 grams per tonne gold over 34.72 metres and 9.44 grams per tonne gold over 3.66 metres within a broader zone of 39.81 metres grading 1.93 grams per tonne gold.

The majority of the Spring Peak project was acquired by Headwater through claim staking of open ground and is 100 per cent owned. The remaining portion of the project is subject to an option agreement with Orogen Royalties, under which Headwater can acquire a 100-per-cent undivided interest, subject to retained royalties. The Spring Peak project is subject to Newmont's right to earn up to a 75-per-cent interest in the project upon meeting certain expenditure thresholds and completing a prefeasibility study within a designated time frame.

About the Lodestar project

The Lodestar project is located approximately 10 kilometres north of the company's Spring Peak project in the Aurora mining district in the Walker Lane belt in western-central Nevada and adjoins Hecla'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. Silica sinter exposures and other high-level epithermal alteration features at Lodestar are geologically analogous to the Spring Peak project and suggest the potential for preservation of undiscovered high-grade epithermal veins at depth.

Headwater holds an option to acquire a 100-per-cent undivided interest in the Lodestar project from a private vendor, subject to retained royalties and 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, including Spring Peak and Lodestar, which continue under partnership. In September, 2024, Centerra Gold Inc. acquired a strategic 9.9-per-cent interest in the company through a non-brokered private placement.

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.