Japanese Firm to Fund Quebec Gold-Zinc Project in Multi-Phase Agreement

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1.Ownership and Share Structure Information

The information listed above was updated on the date this article was published and was compiled from information from the company and various other data providers.

Galway Metals Inc. (GWM:TSX.V; GAYMF:OTCQB) has signed a binding option and joint venture term sheet with Dowa Holdings Co., Ltd. (5714.T), a Japan-based leader in the global non-ferrous metals space. As outlined in the agreement, Dowa can earn up to a 45% participating interest in Galway's 100%-owned Estrades gold-zinc project in Quebec's Abitibi region. The deal also grants Dowa incremental rights to offtake zinc concentrate from Estrades.

The partnership is structured in three earn-in phases totaling up to US$25 million. In the first stage, Dowa will commit US$5 million in exchange for a 10% interest in Estrades and the right to purchase 50% of zinc concentrate output. If Dowa elects to proceed to Phase 2, it would contribute another US$10 million, raising its interest to 30% and increasing its offtake rights to 75%. Galway would act as operator and receive a 6% management fee on approved expenditures during this phase.

Phase 3 would see an additional US$10 million investment from Dowa, bringing its total interest to 45% and granting full zinc concentrate offtake rights. This phase is expected to support the development of a feasibility study on the project.

"We are very pleased to partner with one of the world's most respected integrated mining and metals companies," said Galway CEO Robert Hinchcliffe. "Their commitment to funding up to US$25 million across three earn-in phases validates the quality and potential of Estrades."

Estrades is a past-producing, high-grade mine with underground infrastructure already in place. Historical production over an 18-month period in the 1990s averaged 6.4 g/t gold, 172.3 g/t silver, 12.9% zinc, and 1.1% copper. Galway has launched a scoping study for the site following recent metallurgical enhancements that improved gold recoveries from 58% to 88%.

Zinc Stabilized While Gold Surged on Geopolitical and Monetary Turmoil

According to a January 2 report from Investing News Network, zinc prices ended 2025 on firmer ground following a year of volatility and oversupply. Prices began at US$2,927 per metric ton, fell to a low of US$2,562 in April, then rebounded to close the year at US$3,088. Demand was largely tied to housing and manufacturing, sectors under pressure from persistent inflation and elevated interest rates. As Dean Belder noted, "additional pressures have come from evolving U.S. trade policies," which triggered uncertainty and reduced consumer spending.

The gold market, meanwhile, entered 2026 with strong upward momentum. A January 12 article from Bloomberg reported that Citigroup raised its near-term gold price target to US$5,000 per ounce, calling "the crisis at the US central bank a gift for precious-metals bulls." The revision stemmed from "renewed uncertainty over the Federal Reserve's independence," which drove record inflows into bullion-backed ETFs.

Also on January 12, The International Man's Jeff Thomas addressed concerns about ETF-based gold ownership. He warned that "the buyer is under the impression that he has bought the actual product, when he has not," referring to many ETFs that hold gold on a non-allocated basis. Thomas emphasized that "paper gold… is very risky," and advocated for "ownership of physical gold" despite storage considerations.

A January 12 update from Couloir Capital added that gold prices had climbed 4.2% the prior week, with another 2.0% gain the following Monday. The firm attributed the rally to "escalating geopolitical tensions" and "sustained central bank buying," citing events in Venezuela, Iran, and Greenland as key drivers of safe-haven demand. The report suggested that these factors were offering structural support for the metal amid continued investor caution.

Third-Party Expert Analysis: Growing Confidence in Galway's Revaluation

In a January 12 commentary, John Newell of John Newell & Associates highlighted what he saw as a broader "regime shift" unfolding in the CDNX, calling it "one of the longest and most constructive base structures in its history." He pointed to Galway Metals Inc. as a company well positioned within this technical setup, emphasizing that the shift was rooted not in short-term momentum, but in "time, symmetry, and compression" — elements that he said often precede durable market moves.

Newell described Galway as combining advanced-stage development with exploration upside across multiple Canadian jurisdictions, and noted the company had "defined gold resources" with projects supported by "established geology and scale." Reviewing technical patterns, he observed a consistent cycle of "accumulation, breakout, and consolidation" in the chart, calling it "a gradual revaluation of the company's asset base." With "higher lows firmly established and momentum improving," he added, Galway fit "the profile of a junior transitioning from neglect to recognition as confidence returns to the CDNX."

Strategic Partnership Strengthens Galway's Base Metals Position

The Dowa agreement enables Galway to move forward at Estrades with a global partner experienced in zinc concentrate processing. According to Galway's November 2025 corporate presentation, Estrades spans three geological horizons and lies along a 31-kilometer mineralized trend in a prolific region of the Abitibi. Two mills within trucking distance of the project provide potential optionality for future processing scenarios. 

The upcoming scoping study at Estrades follows the company's metallurgical breakthrough that lifted gold recovery by 31%. Additional value drivers remain active at Galway's Clarence Stream Project in New Brunswick, where the company reported gold recoveries of up to 98% and antimony recoveries up to 88% from metallurgical testing. Drilling continues across multiple zones, and a new mineral resource estimate is expected by mid-2026.

Galway Metals continues to operate with no debt and completed a CA$12 million financing in late December 2025.

Ownership and Share Structure¹

Insiders owned 7.46% of the company, including President and CEO Robert Hinchcliffe, who held 6.76% as the largest individual shareholder. Institutional ownership stood at 18.88%, with the top three being Van Eck Associates Corp. (4.54%), Caisse de Depot et Placement du Quebec (3.4%), and Mackenzie Investments (3.35%). The remaining shares were held by retail investors.

Galway Metals had 125.76 million shares outstanding at the time of reporting, with a market capitalization of CA$71.24 million and a 52-week share price range of CA$0.32 to CA$0.93.