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Power Metal #POW – Australia Gold Joint Venture – Further Licences Granted

Two further licences granted with the JV now holding seven granted licences

Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to announce an update in respect of Red Rock Australasia Pty Ltd (“RRAL”) a joint venture company with gold exploration interests near the historic mining centre of Ballarat in the Victoria Goldfields.

Power Metal has a 49.9% interest in RRAL, with Red Rock Resources plc (“Red Rock”)(LON:RRR)  holding a 50.1% interest.

Highlights:

  • Following grant to RRAL of its first five gold exploration licences in Victoria, announced on 2 February 2021 and 17 March 2021, a further two licences have now been granted:
    • EL007329 (Evergreen) covering 484 sq km
    • EL007301 (Mt Bute), covering 85 sq km.
  • The seven granted licences in Victoria now cover an exploration area of 848 sq km, including numerous old mines and workings and identified geological targets.
  • With the bulk of the ground covered by the previously prepared NI 43-101 technical report (1) now at granted status, the IPO process for RRAL will accelerate.

(1) A copy of the NI 43-101 technical report may be viewed on the Power Metal website through the following link:   https://www.powermetalresources.com/Uploads/2020-09-21-0078-Caracle-KineticsRM_RedRock_NI43-101_Sept21_2020_F_complete.pdf  

 

Paul Johnson, Chief Executive Officer of Power Metal Resources commented :

“Today’s news marks a key point in the development of RRAL with the grant of the Evergreen tenement which is one of the larger licence applications and sits in an area of particular interest as demonstrated by increasing investment by peer companies in project acquisition and exploration.

Grant of the two licences moves the IPO process front and centre. We believe that the core interests of RRAL forming the basis for an IPO on the Canadian capital markets represents one of the most comprehensive investment opportunities in the Victoria Goldfields for Canadian and international investors.

RRAL are therefore moving forward at pace with both project exploration and corporate listing developments.”

 

FURTHER INFORMATION

Joint Venture Company – RRAL

RRAL is a joint venture company 50.1% owned by Red Rock and 49.9% owned by Power Metal Resources plc. Paul Johnson, CEO of Power Metal and Andrew Bell, Chairman of Power Metal and Red Rock, are directors of RRAL.

Granted Licences

RRAL has seven granted licences over an area of 848 km2 and covering high priority areas where RRAL has early drill targets that it is developing.

Licence Number

Project Name

Area (km2)

EL007271

 

Blue Whale

133

EL007281

 

Blue Chip

74

EL007285

 

Blue Ribbon

8

EL007301

Mt Bute

85

EL007327

Blue Stocking

60

EL007329

Evergreen

484

EL007385

Sardinia

  4

Total

848

 

Applications

RRAL has licence applications in process for nine other new gold exploration licence areas covering approximately 1,488 km2 in the Victoria Goldfields of Australia as follows:

 

Licence Application Number

Project Name

Area (km2)

EL007282

 

Blue Sky

489

EL007294

Red Queen

130

EL007328

Blue Yonder

168

EL007330

Blue Angel

202

EL007460

Kilmore West

349

State land within EL007271

 

(EL007505

EL007506

EL007507)

 

 

 

 

 

 

 

(9)

(9)

(8)

EL007540*

(3 competing applications)

 

Outer Ballarat

148

Total

c 1,486

 

* Balmaine Gold Pty Ltd, Mercator Gold Australia Pty Ltd, and Loddon Gold Pty Ltd have put in competing applications the same day as RRAL for the ground covered by EL007540. The application considered to have greatest merit will eventually be given priority.

 

In addition to the Victoria Goldfields above RRAL has also made exploration licence applications in Western Australia as included in the table below.  Please note where indicated below and there is another applicant the application will be subject to a ballot.

EL45/5859

(One competing application)

Paterson

227

EL45/5885

Pilbara/Paterson

70

EL45/5881

(One competing application)

Pilbara/Paterson

33

 

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 (“MAR”), and is disclosed in accordance with the Company’s obligations under Article 17 of MAR.

For further information please visit https://www.powermetalresources.com/ or contact:

Power Metal Resources plc

Paul Johnson (Chief Executive Officer)

+44 (0) 7766 465 617

SP Angel Corporate Finance (Nomad and Joint Broker)

Ewan Leggat/Charlie Bouverat

+44 (0) 20 3470 0470

SI Capital Limited (Joint Broker)

Nick Emerson                                                                                                           

+44 (0) 1483 413 500

First Equity Limited (Joint Broker)

David Cockbill/Jason Robertson

+44 (0) 20 7330 1883

Alan Green talks to Power Metal Resources #POW CEO Paul Johnson – Building a Mid-Tier Business

Power Metal Resources #POW CEO Paul Johnson and Alan Green discuss the strategic aims of POW before looking at progress across key projects during Q1 and upcoming development milestones for Q2.

Paul updates on the Red Rock #RRR Australasia RRAL JV in Victoria, plus Paterson Province options in Australia, the Botswana KCB and Ditau joint ventures with Kavango Resources #KAV and the drilling results from the Molopo Farms project. The Haneti Nickel JV with Katoro Gold #KAT in Tanzania is covered, before we move to Canada and discuss the new Hemlo Gold belt projects and progress at Silver Peak. Paul covers the three separate project spinoffs and potential IPOs (RRAL, Kanye and Silver Peak), and explains how this will help POW to build working capital and ultimately lead to shareholder distributions.

Paul discusses the strong funding position enjoyed by Power Metal, and explains how being a major shareholder in the company is his key motivation.

Power Metal Resources #POW – Audited Results for the Year Ended 30 September 2020

Power Metal Resources plc (LON:POW), the AIM listed mineral resources exploration and development company, is pleased to announce its consolidated audited results for the year ended 30 September 2020 for the Company and its subsidiaries, Cobalt Blue Holdings (“CBH”), Regent Resources Interests Corp. (“RRIC”), and Power Metal Resources SA, (“PMR”), (together the “Group”).

Highlights from the year under review:

Operational

  • A strategic Australian gold joint venture was formed with Red Rock Resources plc (LON:RRR), with Power Metal Resources holding 49.9%.  By year end the joint venture holding company, Red Rock Resources Australasia (Pty) Limited (“RRAL”) had lodged 12 licence applications covering some 2,188 km2 in the Victoria goldfields region. Various technical work was completed in the year including project reports for 11 of the licence applications and a National Instrument 43-101 report for 8 of the licence applications as a group. A new office was secured in Ballarat town and an exploration manager appointed to the joint venture company;
  • Following completion of ground geophysics in 2019 and the delineation of key drill targets, Power Metal Resources elected on 31 December 2019 to earn in to a 40% project holding at the Molopo Farms Complex Project, Botswana by expending US$500,000 on exploration, notably key target drilling in 2020.  A maiden drill programme commenced in October 2020;
  • A new strategic joint venture was formed between Power Metal Resources and Kavango Resources Plc (LON:KAV) in respect of the Kalahari Copper Belt and Ditau Camp Projects in Botswana, with each party having a 50% interest;
  • Review work was undertaken in respect of the exploration and commercialisation options in respect of the Cobalt Blue nickel/cobalt project in Cameroon. No formal conclusions as to the way forward were reached in the financial year, with deliberations continuing post year end and leading to a decision to impair the value of the of the Cameroon project in full (£970,000);
  • A new earn in agreement was formed over the Silver Peak Project, including a former working silver mine, in British Columbia, Canada.  Due diligence programme sampling demonstrated bonanza grade silver from channel sampling;
  • A pitting, sampling and mapping work programme was undertaken successfully at the Kisinka Project in The Democratic Republic of the Congo. X-ray fluorescence testing of the samples confirmed the presence of copper, with samples dispatched to South Africa for analysis and results received post year end.  The results announced in November 2020 demonstrated high grade copper and cobalt values; 
  • Power Metal Resources increased its interest in the Haneti Nickel Project by 10% to 35% in the financial year and worked with joint venture partner AIM Listed Katoro Gold plc (LON:KAT) to plan for commencement of maiden drilling for nickel sulphide and Platinum Group Metals (“PGMs”) at the Project;
  • An agreement was signed in respect of the Alamo Gold Project in Arizona USA which saw Power Metal Resources acquire an option to earn in to a maximum 75% interest in the project.  An initial reconnaissance survey conducted following the acquisition identified additional prospective areas which were pegged and added to existing claims, increasing the project footprint;
  • A further strengthening of the Board saw Edmund Shaw, an experienced City finance professional, join the Board as Non-executive Director in February 2020;
  • At the year-end 30 September 2020 the Company held a private and listed shares/warrants portfolio worth circa £1,481,000, including a £415,000 fair value uplift in the valuation of the portfolio of listed investments in other junior natural resource companies held by the Company over the course of the year;
  • · At the year end the Company held cash in GBP, USD, AUD and CAD of £913,000 in GBP equivalent.

Financial

  • Loss for the year to 30 September 2020 of £1.4 million (2019: £1.6 million);
  • Pre non-controlling interest total equity of £3.6 million at the year-end (2019: £1.8 million); and
  • Raised £1.7 million (before issue costs) in new equity financing during the financial year, from a combination of new and existing shareholders, including the Directors, and an additional £266,000 of cash received by the Company during the year from exercises of Power Metal share warrants.

Post-year end

Expansion of exploration and activity across the Company’s project portfolio including:

  • Drilling programme commencement at the Molopo Farms Complex Project in Botswana (announced 15 October 2020), the Silver Peak Project in Canada (announced 10 November 2020) and the Haneti Nickel Project in Tanzania (announced 30 December 2020);
  • Next stage exploration programmes commenced at the Kalahari Copper Belt and Ditau Projects in Botswana, the Alamo Gold Project in Arizona, USA and the Kisinka Project in The Democratic Republic of the Congo (“DRC”);
  • Continuation of corporate activities since the year end with participation in a rights issue for Kalahari Key Mineral Exploration (Pty) Limited and expansion of the Australian Gold Joint Venture with an application to increase the JV footprint by a further 148 km2 surrounding the Ballarat mine area; and
  • Option agreement signed in January 2021 providing 60 business-days for due diligence which if successful would lead to the acquisition of First Development Resources Pty Limited, a private Australian company with copper-gold exploration interests in Paterson Province, Australia.
  • Agreement signed by Power Metal Resources in January 2021 to acquire a package of gold exploration properties in Ontario Canada, followed by an option agreement providing 30 days for due diligence which if successful would lead to the acquisition of four additional exploration projects also in Ontario, Canada. In February 2021, the Company announced it had exercised the Option to acquire the McKellar Property by transferring total consideration of CAD$100,000 in cash and shares;
  • In February 2021 RRAL received confirmation that three licence applications had been granted enabling the commencement of ground exploration in the Victoria Goldfields, Australia;
  • In February 2021, the Company announced, subject to shareholder approval, a capital reduction to take place in order for distributions to be made to shareholders; and
  • Warrant exercises since the year end have raised a further £2,638,470 for the Company. 

Paul Johnson, Chief Executive Officer of Power Metal Resources commented:

“The audited results for the year ended 30 September 2020 demonstrate the pace of business development at Power Metal.   

In the previous financial year the Company emerged from the refinancing in February 2019 with a new sense of energy and a promise to deliver an exciting investment proposition in resource exploration and development.  As at today’s date Power Metal is a global exploration company with precious and base metal projects across three continents.

Much of the development achieved in the Company was undertaken in the year ended 30 September 2020 and since then we have seen the launch of proactive exploration and corporate activities across multiple projects including district scale opportunities.

Power Metal is well funded with a strong working capital position and an objective to continue to build our “balance sheet” working capital to move the Company toward financial self sustainability.

We believe that 2021 and the coming years presents a great opportunity for junior resource opportunities and where possible we intend to take full advantage.”

Notice of Annual General Meeting and Distribution of Accounts to Shareholders 

The Company’s Annual General Meeting will take place at 11.00 am on 30 March 2021 at Abbey House, 282 Farnborough Road, Farnborough, Hampshire, GU14 7NA.  The Company’s Annual Report and Accounts for the year ended 30 September 2020 will be posted to shareholders this week. Copies of the Notice of AGM and the Annual Report and Accounts will also be available on the Company’s website at www.powermetalresources.com in due course.

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 (“MAR”), and is disclosed in accordance with the Company’s obligations under Article 17 of MAR. 

Power Metal Resources plc

Paul Johnson (Chief Executive Officer)

+44 (0) 20 7583 8304

SP Angel Corporate (Nominated Adviser and Broker)

Ewan Leggat

+44 (0) 20 3470 0470

SI Capital Ltd (Broker)

Nick Emerson

+44 (0) 1483 413 500

First Equity (Joint Broker)

David Cockbill/Jason Robertson 

+44 (0) 20 7330 1883

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