I was under the impression that whilst burning out may be used in some cases/phases, in Europe certainly they would also split out wood.  The wood split out could be used for other purposes - e.g. oars! - as having cut a tree, it is a waste just to burn it.  Finishing with adze/axe to complete the surface.

We do know some about Micronesian canoes, canoe building, tools,  pre-contact and modern.  The image shown is not like having an item in hand and being able to do all sorts of tests on it. 

It would be helpful to know what sort of canoe-goer is being referred to and where in Micronesia the axe is from.

Perhaps the most important thing to clarify what the possessors said about it.  Can they be questioned further about it?  What was the context of their statement?   From the image alone, it appears to be entirely modern and likely, at least in Micronesian context,, nothing special -- unless maybe it was made after an earlier design that would have been made of other material.   It appears that the nature of the axe's material is such that in a canoe environment, it would not have survived more than four or five decades.  The material does not appear to be such that would have been available before World War II.

Nancy's comment is right on the mark.

The serrated edge is intriguing. I would prefer to see better images of the axe. Especially images that show how the way the blade is fastened to the handle. The blade could well be the iron head of a harpoon that was refashioned into an axe. But from the photo, there is no way of telling.

Can you post a better set of images, please?

close -up images of blade attached

 Thanks for the images, will get back to you. On which Island did you collect it? / what is it's provenance?

A friend of mine who was teaching at Chuuk bought it from the locals. All they knew was it was very very old.

After I stripped the handle, it was actually a rebar (reinforced steel bar)! A cover of black rope with bark was wrapped extremely tight around it.

According to my husband Brian, (who grew up in Chuuk and owned an operated several Micronesian canoes), the rebar was evident even from the earlier pictures.  The ribbing on the rebar makes it obvious that it is post World War II rebar.  The blade itself appears to be steel plate, such has been continuously imported to Chuuk since before WWII, but not available in any great supply in decades well before that.  It appears to be made with at least some nickel welding rod.  It would seem highly likely that this is what is called a "chipping hammer." It is used by welders, particularly with arc-welding, and the head can be quite a variety of shapes, depending on the circumstances of the welding being done.    That doesn't mean that it is not a Micronesian navigational artifact. A feature of traditional  Micronesian products, that is often overlooked, resulting in much disappointment to those wanting to see the "real thing," is the evidence of resourcefulness and adaptability, which are part of the tradition.  So much so that if resources available were left out, that would actually be more a transgression of the tradition than to add in material that were not available in earlier times.