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Power Metal Resources #POW – Interim Results for 6 months ended 31 March 2021

Power Metal Resources plc the AIM listed metals exploration and development company is pleased to announce its unaudited interim results for the six months ended 31 March 2021.

Statement by Paul Johnson, Chief Executive Officer: 

“In the six months ended 31 March 2021 we have pushed the Power Metal business to explore extensively across its project portfolio with, in our view, some excellent and very fortunate findings. We are seeking large scale metal discoveries with the emphasis on plural as we believe our portfolio is capable of delivering a number of discoveries.

Junior resource exploration is a high-risk endeavour, so investors in Power Metal rightly expect the potential for outsized returns that come with discoveries and to achieve them requires proactivity and investment in exploration. 

Since October 2020 we have invested in exploration work in every single project we hold an interest in including three separate drill programmes across interests in Botswana, Canada and Tanzania.  There are more planned drill campaigns in the coming months.   

Notable exploration successes announced to date include the identification of extensive anomalies from the Kalahari Copper Belt, Botswana (held in JV with Kavango Resources plc), significant nickel drill intersections from Molopo Farms Complex Project, Botswana, and bonanza grade silver from the Silver Peak Project, Canada.  These are by no means the only successes and as noted above we have been very fortunate with early exploration success across our portfolio.

Notwithstanding the exploration progress being made, and our search for large scale metal discoveries, we are also running a commercial enterprise that has to balance the books and generate working capital to fund its operations. 

We recognise the value of the London capital markets providing access to additional finance and that is one of the principal reasons junior resource companies list. That said we are also looking to build our working capital organically through targeted growth in our investment portfolio and the spin-out of certain projects into their own listed vehicles.   

Financial strength for a junior exploration company is important and as at 21 May 2021 Power Metal had working capital of circa £2.57 million, representing cash and listed company investments. This robust working capital figure was notwithstanding the material expenditure on exploration and corporate development in the half year ended 31 March 2021.

We seek size and scale in our business through metal discoveries in district scale exploration and innovative corporate activity.  To do this we have recognised the need to build our operational team and now have an in-house Exploration Manager, Investor Relations Manager and Corporate Spin-Out Management.  The expanded team is intensively engaged on delivering growth in our business through our project portfolio.

I would like to thank the board and Power Metal team for their determined dedication to our business objectives.  The support we receive from our advisor network continues to be first rate and needs to be as Power Metal is a proactive company.

As always, and never to be left unsaid, I thank our shareholders for their support and commitment to the Power Metal business and its ambitions.  It is easy to be ordinary, yet we have no such desire, and with the support of our shareholders we aim to make Power Metal a stand-out performer demonstrating how an ambitious, determined junior resource company can deliver.”

Power Metal Interests at today’s date:

Country

POW %

Project

Resources

Targeted

Australia

49.9%

Victoria Goldfields

Gold

Australia

75%(1)

Paterson Province

Copper – Gold

Botswana

50.8%(2)

Molopo Farms Complex

Nickel – Copper – Platinum Group Metals (PGMs)

Botswana

50%

Kalahari Copper Belt

Copper – Silver

Botswana

50%

Ditau Camp

Rare Earth Elements

Canada

30%

Silver Peak

Silver

Canada

100%

Schreiber-Hemlo Projects

Gold – Nickel

The DRC

70%

Kisinka

Copper – Cobalt

Tanzania

35%

Haneti

Nickel – Copper – PGMs – Gold – Lithium

USA

Earn-in up to 75%

Alamo Gold

Gold

(1) Conditional agreement to acquire First Development Resources (Pty) Ltd.

(2)   50.8% reflects effective economic interest including 40% direct project interest and 10.8% indirect interest through shareholding in project holding company Kalahari Key Mineral Exploration Pty Ltd

Operational Highlights

In the Half Year to 31 March 2021:

Australia

· Further development of the Australian Gold Joint Venture focused on the Victoria Goldfields including notably the grant of the first three exploration licences announced in February 2021, a further two licences in March 2021 and the commencement of ground exploration across the granted licence ground.

· Option Agreement announced in January 2021 to acquire First Development Resources Pty Limited with interests in two copper-gold properties in the Paterson Province  Eastern Pilbara, Western Australia. (Note this Agreement was subsequently superseded in April 2021 as outlined below).

Botswana

· Drilling commenced in October 2020 at the Molopo Farms Complex Project in Botswana with a 2,500m diamond drill programme targeting nickel sulphide and platinum group metal (“PGM”).  By half year end 3 holes were complete with results sent for assay testing.  Mineralogical studies confirmed the presence of nickel sulphides in drill core. 

· Exploration work undertaken across the Botswana Joint Venture with Kavango Resources plc (LON:KAV) at the South Ghanzi (Kalahari Copper Belt), targeting copper-silver and the Ditau Project, targeting rare earth elements.

Canada

· A 500m diamond drill programme was launched in October 2020 at the Silver Peak Project in British Colombia, Canada, but access challenges and weather conditions led to a change in plans with a man-portable drill rig being used instead to undertake a shortened drill programme. Results announced December 2020 showed high grade silver and demonstrated mineralised vein continuity, with the full drilling programme planned to recommence in 2021. 

· Acquisition of 7 exploration properties in the Schreiber-Hemlo region of Ontario.

The Democratic Republic of the Congo (The DRC)

· High grade copper and cobalt values announced November 2020 from assay testing on the 2020 pitting, mapping and sampling undertaken at the Kisinka Project in the DRC, which led to the commencement of ground geophysics in December 2020 to delineate targets for drilling.

Tanzania

· A rotary air blast drill programme commenced in December 2020 at the Haneti Nickel Project, held in joint venture with Katoro Gold plc (LON:KAT), to provide information leading into a subsequent planned diamond drill programme targeting nickel sulphide and Platinum Group Metals.

USA

· Exploration fieldwork undertaken at the Alamo Gold Project in Arizona USA, as announced in December 2020. 

After 31 March 2021:

· The Rotary Air Blast drilling programme results from the Haneti Nickel PGM Project were announced in April 2021 and confirmed the move to deep diamond drilling;

· Assay results released in April 2021 from hole K1-6 at the Molopo Farms Complex Project in Botswana, confirming significant nickel intersections and later that month the Company confirmed the completion of its earn-in to a 40% direct project interest; 

· Extensive exploration work continued at the Australian Gold Joint Venture in the Victoria Goldfields granted licences and a further update covering this was provided in April 2021, together with confirmation of a further two licence grants later that month;

· A conditional acquisition of First Development Resources Pty Limited was announced in April 2021, with a revised acquisition structure and now including 5 licence interests in the Paterson Province, East Pilbara, Western Australia;

· The Company announced the creation of a new resource project incubator subsidiary in May 2021, Power Capital Investments Limited;

· In May 2021, the Company announced the Kisinka Project in the DRC saw prominent magnetic highs identified from ground geophysics, and an intention to drill at Kisinka following completion of preparatory exploration work.  In addition, confirmation was received that the project had been awarded a 25-year Production Licence; 

· An Option agreement was announced in May 2021 allowing for the acquisition of a 100% interest in two exploration licences in the Tati Greenstone Belt, Botswana, targeting gold and nickel;

· In May 2021 positive findings were announced from the South Ghanzi Project in the Kalahari Copper Belt, Botswana, with extensive anomalies identified including 7 airborne electromagnetic targets for follow up geochemical sampling and drill testing; and

· As at 21 May 2021, Power Metal’s working capital comprising cash and listed investments amounted to circa £2.57 million, providing a robust underlying financial position for ongoing operations. 

Financial Highlights for the Half Year Ended 31 March 2021:

· Loss for the period, attributable to owners of the parent of £0.59 million (2020: £0.24 million), resulting in a loss per share of 0.07 pence (2020: 0.05 pence);

· Warrant exercises during the period raised £2,692,474 for the Company; and

· Net assets of £4.6 million at the period end (30 September 2020: £2.4 million).

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 POW 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 

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale discovery of precious or base metals.

The Company has a global portfolio of project interests including precious and base metal exploration in North America, Africa and Australia. Project interests range from early stage greenfield exploration to later stage prospects currently subject to drill programmes. 

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company’s position to become a leader in the London market for investors wishing to gain exposure to proactive global metals exploration.

Power Metal Resources #POW – Canadian Silver Project Commercial Update – Intention to Seek IPO for Project

Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to provide a commercial update for shareholders covering the Silver Peak Project (“Silver Peak” or the “Project”), in British Colombia, Canada.  The Project includes the Eureka-Victoria Silver Mine, the first Crown-granted mineral property in British Colombia.

The original agreement in respect of the Silver Peak project was announced on 14 September 2020 and may be viewed through the following link:

https://www.powermetalresources.com/n/n251/canadian-silver-project-option-exercised

Highlights:

·    Power Metal has accelerated its earn-in to the Silver Peak Project and now holds a 30% Project interest. 

·    A new Canadian company is being formed to hold a 100% interest in the property and Power Metal will retain its  30% interest in the Project through the new company. 

·    Power Metal has agreed with its partners who hold the remaining 70% interest in Silver Peak to list the Project holding company on a recognised stock exchange and the process has now commenced with relevant paperwork being prepared in this regard. Further information will follow shortly with regard to the listing plans.

·   Power Metal has agreed to pay the CAD$108,952 (£62,313) remaining under the exploration earn-in commitment of CAD$250,000 into the new Canadian company to extinguish that earn-in requirement.  This payment will be made from existing cash resources. 

·    Power Metal has also elected to satisfy the final earn-in payment to secure its 30% Project interest through the issue of 5,139,281 new ordinary shares of 0.1p in the Company (“Ordinary Shares”) at a price of 2.225p and the issue of 2,569,641 warrants to subscribe for new Ordinary Shares at an exercise price of 2.89p and with a three year life to expiry from today’s date. The Ordinary Shares and warrants issued were in accordance with the original agreement announced 14 September 2020 and further information in this regard is provided below.

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

“Alongside its extensive exploration activities Power Metal is intent on generating material organic value from corporate work in respect of its portfolio of interests. In just seven months since we engaged with Silver Peak we are now, with our partners, planning to move this project interest into its own independent listing.

The level of interest in quality silver projects is considerable and we believe that material value can be generated for Power Metal through the listing of Silver Peak.   

Further information will follow with regard to our plans when we have concluded the important preparatory work for the listing.

Power Metal now has three project interests moving forward with planned IPOs  including Silver Peak, Kanye Resources (the strategic joint venture with Kavango Resources plc) and the Australia gold joint venture (with Red Rock Resources plc).

We believe that these proposed IPOs could accelerate the crystalisation of value from the Company’s projects into 2021, providing an earlier recognition of project value.”

Acceleration to 30% Interest – Transaction Information

Balance of Exploration Earn-in Commitment

In the original agreement Power Metal was to pay CAD$250,000 against exploration expenditure at the Silver Peak Project.  Previously Power Metal has paid CAD$141,048 leaving a balance outstanding of CAD$108,952.

As the Project is moving into a proposed listing process immediately Power Metal has agreed to pay the CAD$108,952 (£62,313) remaining under the exploration earn-in commitment directly into the new Canadian company to extinguish that earn-in requirement. This payment will be made from existing cash resources.

Final Earn-in Payment

Also in the original agreement Power Metal was able to pay a final earn-in payment amount of CAD$200,000 in a combination of cash and warrants or shares and warrants.

Power Metal has elected to satisfy the final earn-in payment through a shares and warrants payment as outlined below.

To secure its 30% Project interest Power Metal is to make a payment of CAD$200,000 (£114,349) through the issue of 5,139,281 new Ordinary Shares (“Final Payment Shares”) to the Vendors of the Project interest (Michael Nugent and Jo Shearer).  The number of shares to be issued is based on an agreed 7 day volume weighted average price of Power Metal shares (2.225p). 

In addition, as per the original agreement the Vendors will also receive 2,569,641 warrants to subscribe for new Ordinary Shares (“Final Payment Warrants”) exercisable at a price of 2.89p representing a 30% premium to the issue price of the Final Payment Shares.  The Final Payment Warrants have a three year life to expiry from today’s date.

Admission and Total Voting Rights

Application will be made for the 5,139,281 Final Payment Shares to be admitted to trading on AIM, which is expected to occur on or around 22 March 2021 (“Admission”). The Final Payment Shares will rank pari passu in all respects with the ordinary shares of the Company currently traded on AIM.

Following Admission, the Company’s issued share capital will comprise 1,143,017,211 ordinary shares of 0.1p each. This number will represent the total voting rights in the Company and may be used by shareholders as the denominator for the calculation by which they can determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority’s Disclosure and Transparency Rules.

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

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale metal discovery.

The Company has a global portfolio of project interests including precious metals exploration in North America and Australia together with base and strategic metal exploration in Africa. Project interests range from early stage greenfield exploration to later stage prospects currently subject to drill programmes.

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company’s position to become a leader in the London market for investors wishing to gain exposure to proactive global metals exploration.

Power Metal Resources #POW – Business Operational Update

Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to provide a business operational update for shareholders.

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

“The team at Power Metal are intent on building a great company for our shareholders.  Through the past two years, as evidenced by our market updates, we have built a global resource exploration and development company, with precious, base, and strategic metal interests in North America, Africa, and Australia.

We have multiple workstreams underway, seeking our dual objectives of large scale metal discoveries and corporate activities to build our “balance sheet” through vend outs of certain interests into their own (mainly listed) vehicles in which Power Metal holds a significant stake.

As you can imagine, across this diverse portfolio there is a substantial amount of work to be done. This is a practical challenge for a small team and to ensure that we manage the work effectively the company has recently expanded its operational capability with new team members in operational management, public & investor relations, and new business development.

We seek scale and aggressive growth underpinned by financial stability leading to a much larger business than we are today. As we move along this targeted pathway we intend to efficiently inform shareholders of progress and you will see in the table below the latest position on each of our projects.

We are a fast moving business and all plans are subject to change, depending on many factors including market conditions, exploration success, and business financial strength.  Notwithstanding this our in-built diversification and underlying strong financial position protects and shields us from volatility external to the business and enables us to confidently push ahead with our exploration and corporate activities.”

The table below outlines the latest status of each project in the current Power Metal active portfolio.  For further project information readers should review the latest Power Metal presentation which may be accessed on the Company’s website through the following link:

https://www.powermetalresources.com/p/193/presentations

PROJECT

LATEST POSITION

AUSTRALIA

Australian Gold JV

Gold

(POW 49.9%)

Initial Public Offer (“IPO”) process has formally commenced with the appointment of legal counsel in Canada. The intention is to list certain core assets of Red Rock Australasia (Pty) Ltd (the JV holding company) by IPO in the Canadian capital markets. Shareholders should note that there can be no certainty that the proposed IPO of certain core assets of Red Rock Australasia (Pty) Ltd will be successful, further updates will be made to shareholders as appropriate.

Following the grant of first three licenses, as announced on 2ndFebruary 2021, a further seven applications are at an advanced stage of processing.

Application made for a new exploration license covering 227 sq km (EL 45/5859) in Western Australia, which will be subject to a ballot between RRAL and Rumble Resources Ltd (ASX:RTR).

BOTSWANA

Kanye Resources

Copper, Silver, Rare Earths

(POW 50%)

Kanye Resources Plc  now formed in the UK, and Kanye Resources Pty Ltd in Botswana.  This is the holding company company structure for a planned listing of Kanye Resources on a recognised stock exchange.

Kanye Resources includes the Ditau Project and the Ghanzi South (Kalahari Copper Belt) Project, and the exploration status of each project is outlined below.

Ditau Project

An exploration camp has been established and the field team has continued taking soil samples and conducting ground magnetic surveys. A new senior geologist has been recruited to oversee operations.

Data is currently being analysed on the I10 target. Results from this are expected to guide future exploration of the remaining 9 potential carbonatite targets.

Ghanzi South (Kalahari Copper Belt) Project

Intensified soil sampling, airborne electromagnetic survey and magnetic geophysics survey, all underway.

Sampling and surveys focused on key target areas and seeking delineation of key drill targets.

Environmental Management Plan being finalised, which following approval will allow drilling to be undertaken.

BOTSWANA

Molopo Farms Complex

Nickel, Copper, PGMs

(POW with Economic Interest up to 50.96%)

Following completion of two drill holes, drill core has been cut and inspected. 

Drill core samples sent to South African accredited laboratory and assay results awaited.  Samples also sent to Witswatersrand University for mineralogical and thin section analysis and results awaited.

Third drill hole to be commenced shortly and ongoing technical review underway.

CANADA

Hemlo/Schreiber

Gold, Base Metals

(POW 100%)

Acquisition of seven projects now complete and comprising exploration Claim packages strategically located across the Hemlo/Schreiber greenstone belt.

Preliminary exploration work planned includes remote sensing data interpretation and ground based fieldwork with systematic soil sampling and geophysics expected to yield defined targets for future drill testing.

CANADA

Silver Peak

Silver

(POW Earn-in to 30%)

Recommencement of exploration work including completion of the planned drill programme following the snow thaw in Spring 2021 targeting high-grade silver and  to establish vein continuity.

Currently working with our partners to review corporate options including a potential listing of the Silver Peak project on a recognised stock exchange.

THE DRC

Kisinka Project

Copper, Cobalt

(POW 70%)

 

Ground magnetics completed and induced polarisation to begin over 6.8 kilometre copper-cobalt anomaly nearing completion. Following the completion of fieldwork, and interpretation of findings, likely next step will be exploration drilling of key targets.

Application to secure a 25 year Permis d’Exploitation (production licence) is progressing well and in the final stages of processing.

TANZANIA

Haneti Project

Nickel, PGMs, Copper, Gold, Lithium

(POW 35%)

Following completion of 1,965 metres of Rotary Air Blast drilling, 776 three metre composite samples have been delivered to SGS Tanzania, an accredited assay laboratory in Tanzania.

Samples being analysed using multi-element Aqua Regia Digestion/ICP-OES* method with 13 select samples to also be tested using Fire Assay for gold, platinum, and palladium. 

Assay results expected shortly and the findings will guide next stage exploration.

 

USA

Alamo Gold Project

Gold

(POW Earn-in up to 75%)

Ground exploration programme (as announced 11 December 2020) now completed and detailed operational report received by Power Metal.

Full technical review underway to determine next exploration and commercial steps.

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

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale metal discovery.

The Company has a global portfolio of project interests including precious metals exploration in North America and Australia together with base and strategic metal exploration in Africa. Project interests range from early stage greenfield exploration to later stage prospects currently subject to drill programmes.

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company’s position to become a leader in the London market for investors wishing to gain exposure to proactive global metals exploration.

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

Power Metal Resources #POW – Business Financial Review and Warrant Update

Power Metal Resources PLC (LON:POW) the AIM listed metals exploration and development company is pleased to announce a business financial review and warrant update for shareholders.

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

“Power Metal has multiple exploration programmes underway alongside significant corporate activities in and around certain of our projects.

Given the extent of our activities I would like shareholders to also know that your Company is in a strong financial position and is well funded to complete all its currently planned exploration work, including drilling programmes underway at present.

Moreover, after the current programme of extensive exploration activities to 31 March 2021 are complete and paid for, the Company will still have significant financial resources and remain in a strong position.  This is further explained below with information regarding where we are with business operations, key financial exploration commitments and our underlying financial position.

In addition, I would draw shareholders attention to the “Warrant Update” section below which confirms Power Metal has successfully exceeded the price hurdle to enable acceleration of certain warrants.  Recognising Power Metal’s strong financial position we consider there is no requirement to exercise any right to accelerate warrants at this time.

Finally, the Company notes that in the Final Results for the year ended 30 September 2019 (announced 20 May 2020) reference was made to a planned fundraising in November 2020.  Given the £1 million raised in July 2020 and the receipt of warrant exercise monies since August, there was no need to undertake a fundraising in November 2020.”

BUSINESS AND FINANCIAL REVIEW

Power Metal’s working capital position as at 12 January 2021 was circa £2.72 million including Pounds Sterling, US Dollars, Australian Dollars and Canadian Dollars and the current value of the Company’s listed investments. Power Metal has no debt, and all trade creditor invoices received by 12 January 2021 have been deducted from the working capital figure above.

The Company’s anticipated exploration and corporate spending for the period to 31 March 2021 is currently estimated at circa £0.6 million and as a result following the completion of the period to 31 March 2021 the Company expects to still hold a robust working capital position.

The table below provides a further breakdown of the current operational and the cash funding position of each project in the Power Metal portfolio. For specific larger expenditure items we provide information of the cash commitments expected in the period to 31.3.21.

The inclusion of the table below is designed to increase transparency and detailed disclosure for shareholders enabling a fuller understanding of the cash requirements of the business in the coming months and helping to validate the strength of the Company’s underlying financial position as outlined above.

The assumptions underlying ongoing exploration and corporate costs are subject to change and are provided for guidance only.

Furthermore, should there be additional receipts of warrant monies the Company would be in an increasingly strong financial position and able to further accelerate project activities if deemed appropriate.

Table: Power Metal Detailed 2021 Project Operational and Financial Breakdown:

PROJECT

EXPLORATION FOCUS

POW

INTEREST

OPERATIONAL POSITION

PROJECT FINANCIAL INFORMATION(Cash Costs)

AUSTRALIA

Victoria Goldfields

JV with Red Rock Resources plc (LON:RRR)

 

Gold

49.9%

13 licence applications covering a footprint of 2,336 km2.. Prepared 11 historic project reports including exploration planning and a National Instrument NI 43-101 technical report covering 8 applications. Awaiting initial licence grants for 3 priority licence applications (EL007271/7281/7285) and progressing potential listing plans on a North American stock exchange and other possible joint venture initiatives.

Power Metal has paid in full all contributory costs into the Joint Venture (“JV”) to date. In the period to 31.3.21 we have provided for general cash costs to run the JV Ballarat office and for a step up in exploration activities in Q1 2021 subject to the receipt of granted licences.

BOTSWANA

Ditau Camp Project

SJV with Kavango Resources plc (LON:KAV)

 

Rare Earths

50%

2 licences (1,386km2) with Rare earths potential established from recent exploration work.  First stage orientation work complete and follow up work announced 4.1.21.

Power Metal has made  advance payments of US$150,000 to cover its 2-year sole exploration commitment under the strategic joint venture (“SJV”) agreement ahead of schedule.  Power Metal has also paid its £10,000 initial contribution to corporate restructuring costs for the SJV, with the intention of initiating the process for a potential  listing of the SJV in 2021.

BOTSWANA

Kalahari Copper Belt Project

(SJV with Kavango Resources plc (LON:KAV)

 

Copper

Silver

50%

2 licences (1,294km2 ) directly to the southwest of Sandfire Resources’ T3 and A4 Dome copper-silver discoveries. Soil sampling programme underway with initial samples identifying zinc pathfinder in x-ray fluorescence (“XRF”) analysis. Follow up work announced 23.12.20.

BOTSWANA

Molopo Farms Complex Project

 

Nickel

Copper

PGMs

Up to 50.96%

3 licences (1,780km2) with multiple targets identified from electromagnetic survey and ground geophysics. Drilling of four high profile targets underway with two holes complete and extensive technical analysis underway.  Thick ultramafic zones have been intersected and in hole KKME 1-6 visible sulphides have been identified as announced 11.1.21.

Power Metal is spending US$500,000 to earn into a 40% direct project ownership which along with its 18.26% project holding company interest, will give a 50.96% effective economic project interest to Power Metal.  To date circa US$292,641 has been paid with a further US$207,359 (circa £151,952) included in cash costs to 31.3.21.

CAMEROON

Cobalt Blue Project

 

Cobalt

Nickel

100%

4 licences adjacent to, or within 50km of the Nkamouna/Nada cobalt/nickel deposit.  Review of exploration and commercialisation options reaching an advanced stage.

Further update to follow regarding the Company’s plans and financial commitment.

CANADA

Silver Peak Project

 

Silver

 

Earn -in to 30%

Mineral claims over historical Eureka-Victoria Silver Mine and high grade, intrusion related, polymetallic Ag-Pb-Zn-Cu veins.

Summer 2020 channel sample programme included a delineated bonanza grade silver up to 0.50m @ 14,937 g/t Ag, 3.05 % Cu & 11.95 % Pb. In November, drill hole SP2020-01intersected a rubbly vein zone between 1.52m to 1.83m which assayed 0.31m @ 5,270 g/t (169.5 troy oz/tonne) silver as announced 29.12.20.

Planned recommencement of drilling in Spring 2021.

 

As part of the earn-in to 30% Power Metal has committed to cover CAD$250,000 on exploration in the period to September 2021.  To date CAD $141,048 has been paid covering expected spend to 31.3.21 and leaving CAD$108,952 remaining later in 2021.

THE DEMOCRATIC REPUBLIC OF THE CONGO

Kisinka Project

 

Copper

Cobalt

70%

Exploration licence of 41 carrés miniers (each 84.95 ha) with a 6.8km copper/cobalt anomaly identified.

Geophysics programme launched in late 2020 (as announced 15.12.20) and finalising the conversion of the licence to a Permis d’Exploitation (production license) with a 25-year life.

Advance payments made to cover geophysical programme costs.   Further costs of circa US$30,000 are expected in the period to 31.3.21.

TANZANIA

Haneti Project

JV with Katoro Gold plc (LON:KAT)

 

Nickel

Copper

Platinum Group Metals (‘PGM’)

Gold etc

35%

Large polymetallic land package of c.5,000 km2 including 80km long ultramafic complex with drill ready nickel sulphide/PGM targets.  Currently undertaking Rotary Air Blast drill programme at Haneti (as announced 30.12.20).

Power Metals has already made advance payments towards maiden drill programme costs.  Balancing Power Metal drill costs are expected to be circa US$55,000 in the period to 31.3.21.

USA

Alamo Gold Project

 

Gold

Earn-in up to 75%

Package of mining claims covering c.946 acres prospective for gold following the discovery of native gold nuggets near surface. Follow on work underway (as announced 11.12.20 and after completion of the reconnaissance survey in summer 2020) with further update to market expected shortly.

Power Metal has committed to minimum exploration spend in the 12 months to July 2021 of US$100,000, of which US$50,000 has been paid and a further US$50,000 is expected in the period to 31.3.21.  In addition, a further US$25,000 of property payments to the vendor were made in December 2020 in accordance with the earn-in commitment.

 

WARRANT UPDATE

On 10 December 2019 Power Metal announced an Equity Placing and Subscription which included the grant of 175,000,000  warrants exercisable at a price of at 0.70p per new ordinary share of 0.1 pence each in the Company with an exercise period ending on 10 December 2021, (the “Financing Warrants”). 

The Financing Warrants were subject to an acceleration clause whereby should the volume weighted average share price (“VWAP”) exceed 2.25p for 10 consecutive trading days, the Company may write to warrant holders providing 10 working days’ notice of accelerated exercise, with 15 working days thereafter for payment.

The Company can confirm that in the 10 consecutive trading day period of 24 December 2020 to 11 January 2021 the Power Metal VWAP exceeded 2.25p and therefore the Company has the right to accelerate any unexercised Financing Warrants.

For the avoidance of doubt Power Metal is not at this time proposing to utilise the above acceleration clause.

The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No.596/2014 and is disclosed in accordance with the Company’s obligations under Article 17 of those Regulations.  

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

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale metal discovery.

The Company has a global portfolio of project interests including precious metal exploration in North America and Australia together with base and strategic metal exploration in Africa. Project interests range from early stage greenfield exploration to later stage prospects currently the subject of drill programmes.

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company’s position to become a leader in the London market for investors wishing to gain exposure to proactive global metals exploration.

Power Metal Resources #POW – Canadian Silver Project – Exploration Update & Drilling Results

Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to  announce an exploration update from the Silver Peak silver project in British Columbia, Canada.

CHIEF EXECUTIVE OFFICER’S STATEMENT

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

“I am very pleased to announce the results of the revised man-portable drilling programme at Silver Peak conducted in November 2020.

We were eager to investigate high-grade vein continuity at Silver Peak hoping that positive exploration outcomes would build our knowledge base and potentially expedite the pathway to bringing what was a former high-grade working silver mine back into production.

The severely challenging weather conditions altered and curtailed the drill programme as announced, and notwithstanding the enhanced geological understanding of the silver mineralisation we gathered during the drilling exercise, the low number of samples collected meant it would be more difficult to establish any potential vein continuity as targeted. 

Moreover, with the weather impacted operating conditions on site, planned holes covering a number of possible high-grade vein continuity targets could not be completed and have been deferred until weather conditions improve.

The larger drill meterage originally planned is ultimately needed to ensure sufficient drilling is undertaken to potentially intersect any high-grade vein targets below the influence of near-surface weathering and to demonstrate vein continuity between the former Silver Peak mine portals.

Nevertheless, fortunately, even with the curtailed programme we have successfully delineated very high-grade silver (5,270 g/t or 169.5 troy oz/t silver per Table 1 below) in the Victoria Vein at a vertical elevation approximately 150m lower than the exceptionally high-grade channel sampling intersections from the summer due diligence programme (up to 14,937 g/t or 480 troy oz/t silver per Table 2 below).

Whilst we will still need to complete the previously planned programme as explained above and undertake deep diamond drilling to establish continuities within the high-grade zones between the two sampling areas, these preliminary results are very encouraging.

We are working with our partners to finalise the next stage ground operations, including the above diamond drilling, which we expect will commence following the Spring thaw around March/April.  We will communicate the updated exploration plan early in the new year.”

TECHNICAL SUMMARY:

  • Assay results for the revised shallow drilling programme at Silver Peak Project have been received from ALS Laboratories in Vancouver, with further high-grade silver confirmed in the Victoria Vein. The samples were assayed using ALS’s trace and Ore Grade Silver analytical packages (Ag-AA61, Ag-AA62 & Ag-GRA21), see results in Table 1 below.

  • Drill hole SP2020-01 collared at the sub-vein west of the Lower Portal at an elevation of 1,634m intersected a rubbly vein zone between 1.52m to 1.83m which assayed 0.31m @ 5,270 g/t (169.5 troy oz/tonne) silver. 

  • The SP2020-01 intersection is very encouraging given it confirms high silver grades occur in the Victoria Vein system over at least 150m of vertical extent.  Precious metal vein systems can often show a high degree of silver grade zonation in the vertical dimension.

  • The revised drill programme consisted of 6 short diamond drill holes which were collared in close proximity to the bifurcating vein system around the Lower Victoria portal. (The Lower Portal is 158m vertically below the Upper Portal which was the subject of a channel sample programme which delineated bonanza grade silver up to 0.50m @ 14,937 g/t Ag, 3.05 % Cu & 11.95 % Pb as announced 22 September 2020).

  • Five other holes were collared in close proximity to other branches of the vein system with lower silver results (up to 7g/t Ag); however, these holes are considered inconclusive as core recovery was poor in these vein intersections due to the effects of near surface vein weathering.

  • Chip samples from surface vein material and oxidised facture zones around the Lower Portal also returned lower silver values (up to 8.4g/t Ag) indicating a high degree of zonation in the vein mineralisation.

  • Tracing of the high-grade zones between the Upper Portal and Lower Portal will require further geological and structural mapping and mineralogical study in conjunction with the planned deep diamond drilling to assess the geological controls on the bonanza grade mineralisation.

  • As announced on 10 November 2020 and 24 November 2020 due to issues with the tracked drill rig accessing the planned drill pads and due to the onset of winter conditions Power Metal’s local partners undertook a smaller sampling programme employing man-portable drill equipment and surface sampling.

 

Table 1: Silver Peak Portable Drill Sample Assay Results

Hole ID

From (m)

To (m)

Interval

Silver Grade (Ag ppm)

(by ALS assay method)

Ag-AA61

Ag-AA62

Ag-GRA21

SP2020-01

1.52

1.83

0.31

>100

>1,500

  5,270.00

SP2020-02

0.00

0.43

0.43

0.60

SP2020-02

0.43

0.53

0.10

<0.5

SP2020-02

0.53

poor recovery

0.60

SP2020-02

2.60

poor recovery

1.80

SP2020-03

2.74

poor recovery

2.90

SP2020-04

0.30

poor recovery

7.00

SP2020-05

1.50

poor recovery

5.10

SP2020-06

1.22

poor recovery

1.30

All Holes drilled to ci rca 3.66m (12ft).  Poor sample recovery in weathered rock and vein material resulted in inconclusive interval widths

 

Table 2: Summary of Assay Results for Power Metal Due Diligence Sampling on Victoria Vein, Silver Peak Project (as announced 22 September 2020)

ALS Global Analytical Method

Ag-GRA22

Ag-CON01

Cu-OG46

Pb-OG46

Sample ID

 

Channel Sample Length

(m)

Ag

(ppm)

Ag

(ppm)#

Cu

(%)*

Pb

(%)*

SP20-001

0.50

>10,000

10,718

2.14

2.99

SP20-002

0.50

6,010

1.71

2.87

SP20-003

0.50

7,530

1.57

2.07

SP20-004

0.60

5,540

1.38

SP20-005

0.70

7,880

1.94

3.16

SP20-006

0.50

>10,000

14,937

3.05

11.95

SP20-007

0.80

5,330

1.26

SP20-008

0.55

1,595

1.78

SP20-009

0.45

4,110

SP20-010

0.65

1,755

1.71

SP20-011

N/A Grab sample

660

* Cu and Pb results rounded to two decimal places. 

# Two over limit silver samples were analysed >10,000 ppm Ag by method Ag-GRA22 were reanalysed using method Ag-CON01. 

FURTHER INFORMATION

Silver Peak Project

The Silver Peak Project consists of a portfolio of mineral claims (the “claims”) over a system of high grade, intrusion related, polymetallic Ag-Pb-Zn-Cu veins, part of the historical Eureka-Victoria Silver Mine, at Silver Peak in southern British Columbia, Canada.

Power Metal Earn-In

On 14 September 2020 the Company announced the exercise of an option agreement announced 17 August 2020 (the “Earn-In”) in respect of the Silver Peak Project, gaining the right to earn-in to a 30% interest in the Project.

The full terms of the Earn-In were outlined in the 14 September 2020 announcement, and included a CAD$250,000 Exploration Commitment within the 12 months of the option exercise.  To date Power Metal has paid CAD$141,048 of this Exploration Commitment with CAD$108,952 (circa £63,000) remaining and due by 17 August 2021.

COMPETENT PERSON STATEMENT

The technical information contained in this disclosure has been read and approved by Mr Nick O’Reilly (MSc, DIC, MIMMM, MAusIMM, FGS), who is a qualified geologist and acts as the Competent Person under the AIM Rules – Note for Mining and Oil & Gas Companies. Mr O’Reilly is a Principal consultant working for Mining Analyst Consulting Ltd which has been retained by Power Metal Resources PLC to provide technical support.

The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No.596/2014 and is disclosed in accordance with the Company’s obligations under Article 17 of those Regulations.

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

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale metal discovery.

The Company has a global portfolio of project interests including precious metal exploration in North America and Australia together with base metal exploration in Africa. Project interests range from early stage greenfield exploration to later stage prospects currently subject to drill programmes.

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company’s position to become a leader in the London market for investors wishing to gain exposure to proactive global metals exploration.

Power Metal Resources #POW – Company Q&A

Power Metal Resources PLC (LON:POW) the AIM listed metals exploration and development company is pleased to provide the questions and answers to a number of investor queries received recently by the Company. Where possible the question below is that presented to us, however where multiple questions involve similar themes, we have consolidated into a single question to avoid duplication.

Power Metal also notes that investors wishing to understand the current position of the Company may refer to the recently uploaded Investor Presentation which is available on the Company’s website and may be viewed through the following link:

https://www.powermetalresources.com/p/193/presentations

COMPANY Q & A

Power Metal Resources has received numerous investor queries recently and we are pleased with the increasing interest shown in our activities.  Where possible questions have been grouped into categories as outlined below.

Project Operations – Exploration and Corporate Activities

QUESTION

RESPONSE

Botswana – Molopo Farms Complex

 

Regarding drill #1 – why was the drill stopped when the anomaly identified via geophysics indicated an anomaly stronger with depth? 

 

The hole was angled at 60 degrees and was over 500m in length and passed between harder and softer rock as it descended.

The possibility of some deviation as we drilled makes it possible that we have missed by a few metres a steeply dipping target identified by geophysics.

The mudstones encountered could be generating a conductive anomaly but are likely to cover a greater areal extent as they are a known horizon in the Molopo Farms Complex of rocks, so this would be inconsistent with the areally restricted conductive anomaly identified from our geophysical work.

One possibility is that the geophysics took a gently dipping anomaly and a steeply dipping anomaly, the latter being our target, and modelled the two as being one.

It was more logical given the above to stop the hole at the target depth and move on to drill the next hole while analysing the core and doing down-hole geophysics.  If we had carried on drilling, we could have possibly drilled right past our target.

With the downhole geophysics we can look around and below the hole for 300m in each direction and so get a more accurate 3-D geophysical model and interpret the dip and orientation of the strata encountered in the drill core.

Unless results do not justify it, we will return to the hole and if necessary, deviate from it or drill deeper to test the assumed target.  

 

Botswana – Molopo Farms Complex

Is the geological model for the Molopo Farm Complex looking for geology similar to the Bushveld Igneous Complex, the Great Dyke in Zimbabwe or some other large ultramafic complexes?

 

 

Each ultramafic complex has its own characteristics depending on the conditions that produced it. We are drilling a satellite ultramafic intrusive which is part of, and of similar age to, the Large Bushveld Igneous Province, as described on this page of the KKME website: https://www.kalaharikey.co.uk/mopo-farms-project/geology-of-the-molopo-farms-complex/ .

Australia – Victoria Goldfields

What is the status of the Australia gold JV and will shareholders receive a distribution from Power Metal if the Australian Joint Venture Company is listed on a North American stock exchange?

 

 

 

We have various work streams underway in respect of the Australia gold joint venture and it is a very proactive period for this important part of the Power Metal business.

 

Our immediate focus is the advancement of the technical project information and exploration planning in preparation for the launch of efficient and targeted ground exploration which can only commence on the grant of licence applications.

 

In parallel we continue to work on the potential listing of some or all of the interests on a North American stock exchange as announced to shareholders.

 

In all discussions our focus is rapid advancement of exploration and significant commitment by any potential partners to ground exploration where we believe considerable value can be added through proactive implementation of exploration programmes.

 

The potential listing could generate an asset of considerable value given the strategic nature of the ground under application in Victoria.  That valuation would increase, perhaps significantly, with the grant of licences and the ability to launch ground exploration to validate our geological propositions. There is clear evidence of significant gold mineralisation across the licence application footprint.

 

The question of whether we would specifically seek to distribute any listed activity gains from the Australia JV, or indeed from any other corporate transaction undertaken by Power Metal or its partners, is a little early to definitively answer at this stage.

 

It is fair to say that we are attracted to the distribution model, which allows shareholders to see a return from their investment in Power Metal in addition to the appreciation in Power Metal share value that commercialisation of our interests could provide.

 

There are many elements to consider in this including what is best to advance the projects, the approach of any partners to transactional structuring, positioning Power Metal to enable distributions and considering the taxation elements to seek distribution efficiency from a tax planning perspective.

 

There are many work streams to complete if Power Metal were to consider distributions, but they can be run concurrently, and they could include seeking the approval of shareholders at a General Meeting.

 

 

Australia – Victoria Goldfields

How does Power Metal value its interests in the Australian Joint Venture Company and particularly its licences?

 

 

 

This is a complicated exercise as valuation depends on many factors including inherent geological and commercial potential, market conditions, granted or application status, historic and future spend and perhaps significantly the strategic significance of the JV interests.

 

We are developing valuation metrics, however for a real sense of valuation in the current market we can only look at recent transactions for similar interests and gain a feel for what might be achievable.

 

As stated previously a major factor for us is the commitment to significant ground exploration and financial investment to support that exploration work. We believe that proactive exploration stands a very good chance of identifying gold mineralisation and that will be a major uplift to any project valuation.

 

As you can see we are working with so many variables, but we know that having identified and built such an important and strategic land package in Victoria, we now have a duty to manage this professionally and seek the highest returns reasonably achievable from this unique opportunity.

 

Australia – Victoria Goldfields

Will Power Metal be seeking an income stream from any commercial transactions in respect of the Australian interests?

 

 

 

The main objective is the pursuit of exploration and corporate transactions that will maximise the capital return from the opportunity.  Income wise, we will likely focus on royalty income streams from interests as and when we involve third parties in a project or projects.

 

Australia – Victoria Goldfields

There is a lot of interest being shown in Victoria gold projects including ECR Minerals plc one of your neighbours.  Is this something you are also experiencing for the gold JV in Victoria?

 

 

 

It is increasingly clear that the Victoria Goldfields is a particularly attractive destination for gold exploration. 

 

The strategic nature of our Australia gold JV, with the size of land package assembled and the extent of prospectivity that’s evident from our published technical work, means that there will be interest and we have stated this previously.

 

Australia – Victoria Goldfields

Are there plans to re-process mine dumps in the Victoria Gold Fields in Australia once appropriate licences are granted?

 

 

This is not something we have looked at so far, but as licenses are granted, we will investigate the evidence at surface where there has been previous mining activity, which may include small gold-bearing dumps or tailings.

USA – Alamo Gold Project

Do you expect to be able to mine nuggets of gold from near the surface at the Alamo gold project in Arizona?

 

As announced by the Company via RNS on 20 November 2020, the plan is to undertake mini-bulk sampling alongside other exploration techniques in December 2020.  That should tell us more about project mineralisation including the prospectivity for gold nuggets near surface.

We are also looking at the potential for other mineralisation and the potential bedrock source of the gold mineralisation that, as we have clearly established to date, exists near-surface.  The latter was also demonstrated during our January 2020 due diligence field trip where we identified gold nuggets during the digging and metal detecting of shallow pits at the project.

This is early stage exploration and the prospect of mining, although ultimately our principal objective, is something we must build towards with exploration.  If successful, that exploration will confirm gold mineralisation of a magnitude to support permit applications and associated studies that would be the precursor steps to the launch of mining operations.

 

Tanzania – Haneti Project

You have announced that mobilisation is underway but when will drilling actually commence at the first drill location?

 

Power Metal has a communications approach that articulates through regulatory news announcements the status and progress on all of our material project interests.  This includes Haneti which is a very material opportunity for the Company.

Power Metal, with our partners Katoro Gold plc have announced pre-mobilisation, mobilisation of drilling and intend to announce an update on full drill commencement as appropriate, including if possible images on our website photo gallery showing the drill in action at the drill location.

 

Tanzania – Haneti Project

Why has Haneti not been drilled before if it is such an important strategic opportunity?

 

On a general level the junior resource sector has been experiencing challenging conditions for some time and in many cases, there has not been the financial capital around to pursue project acquisitions or impactful exploration activities.

Many great discoveries have, in our view, been made in scenarios where projects have not been able to attract sufficient project capital to enable progression of exploration.

Haneti is however a project that has received exploration capital over many years and has built to a position where the next stage is drilling.

Importantly Haneti now has two public companies working together to operate and finance drilling. 

Given the level of interest shown in the project, and in nickel sulphide exploration opportunities generally, it makes commercial sense all round to crack on with drill programmes which is what is happening at Haneti.

 

Canada – Silver Peak

When do you expect to receive assay results from the work undertaken recently?

 

As with all our projects we push for the receipt of assay data as soon as possible.  With the Covid-19 restrictions around the world in 2020 the Company has not been in a position to accurately confirm timescales around the receipt of assay data from third parties. As soon as assay results are received and interpreted by the Company, an announcement will be made to shareholders.

 

Canada – Silver Peak

Given we are now in winter season, how do you expect to take Silver Peak project forward?

 

We generated highly positive exploration findings from the summer due diligence sampling work including bonanza grade silver and significant copper and lead.  We await the assays from limited follow up drilling and sampling we were able to undertake in the short programme that we recently announced was curtailed by poor weather conditions.

Using the above and the historic exploration data available to us, we will, with our partners, determine the next exploration and corporate steps for the Silver Peak project.

We believe the Silver Peak project has great potential and now must identify the appropriate pathways for its development.

 

Canada – Silver Peak

Were you disappointed with the weather disruption at Silver Peak and what can you do to get the project back on track?

 

Absolutely. Power Metal is keen to push each project as hard as possible and we put a lot of work into drill programme design and implementation.  The weather hit us twice with storms damaging access and meaning our original programme with a larger rig could not go ahead.  Then the snow brought our man-portable rig operation to an abrupt and early conclusion.

We believe shareholders prefer a proactive approach to exploration and clearly, we pushed hard to get the Silver Peak drilling done whilst ensuring safety of operations at the site in the more challenging conditions.

 

DRC – Kisinka

Is it possible to extract value from the Kisinka project in the DRC and are you not concerned that money invested may be locked in?

 

We have operations around the globe in different jurisdictions and the DRC is one country that we believe investors perhaps do not fully understand or appreciate.  We think that will change.

The Company’s experience to date has been very positive however and suggests to us that there is real value to be created in the DRC, not least because of the immense metal prospectivity across the country.

Power Metal is pursuing a potential new copper-cobalt district at Kisinka which is situated near to Lubumbashi in the south-east of the country.

The quality of technical reports that we receive from operations at Kisinka is extremely good demonstrating the professionalism of our partners. 

Also, based on our experience the ability to secure licences and permits for operations is in many respects more straightforward than many jurisdictions where the process is more complex and takes longer.

Added to all this there are many international companies that are operating producing mines in the DRC including Ivanhoe’s Kamoa-Kakula under development now and which is expected to become one of the largest global producing mines.

 

DRC – Kisinka

When do you expect to complete the geophysics and start drilling?

 

The high-grade copper and cobalt from assays recently announced means that Kisinka is a key project interest and we are looking to commence follow on exploration as soon as possible. 

As announced 20 November 2020 the Company is working on setting up a ground magnetic survey and a ground electromagnetic survey, to detect both low magnetic and chargeable lithologies and indicate structures and faulting and areas of carbonate rocks, in order to generate precise drill targets with our in-country partners. 

The Company will make a further announcements to the market as appropriate in respect of the proposed programme at Kisinka.

 

Botswana – Kavango Resources JV

When will we hear more about the exploration work from the Kalahari Copper Belt?

 

As announced in the Company’s ‘Project Portfolio Update’ on 5 October 2020 the Company is awaiting the results of a soil sampling programme.  An update on that programme, its findings and the next steps will be released to the market once results have been received and interpreted.

 

Botswana – Kavango Resources JV

Have you refined your plans for a listing of the JV on a Canadian or UK stock exchange?

 

Plans remain on track and we have been putting in place the steps to achieve our listing objective.

We will provide an update on this to the market as appropriate.

 

General – Project Valuations

Do you have anything you could provide to investors with valuation indications on the projects, such as project NPVs?

 

We have a portfolio of early stage project interests, albeit some are in a more advanced stage with drill programmes running.  It is more difficult to ascribe valuations to earlier stage projects.

A similar situation exists on discovery, where the full extent of a project’s valuation will only be developed as projects are progressed and more is understood about the scale and type of mineralisation.

To a certain extent the involvement of third parties on project earn-in or joint ventures can assist with an assessment of likely value also.

In addition, project spinouts especially involving compensation in marketable assets such as listed equity will also help the developing value assessment.

As soon as we can start to attribute specific values to project interests and investments we will seek to do so.

 

General – New Opportunities

Are you still looking for new opportunities and are you limited in the regions you would operate in and the commodities you would explore for?

 

The Company actively assesses any new opportunities it is presented with although it has to be said we have already noted a rise in vendor expectations regarding project valuations. 

We are of the belief that we would not have been able to assemble our current portfolio of projects on the same terms today given the stronger natural resources environment.

We were given a tremendous opportunity by the difficult market conditions of 2019/2020 and now shareholders have the advantage of a portfolio constructed in challenging markets, as those same markets move into what we believe will be a stronger phase.

We want to develop the Company around clear themes, demonstrating consistency and clear strategic rationale.  Therefore, we think it’s wise to follow the overall business structure of precious metals in North America and Australia and base metals in Africa. 

 

 

Business Management

QUESTION

RESPONSE

How is the Company able to manage 9 projects and commit adequate management time to each?

 

Whilst the management of a number of projects is a challenge, the Company ensures that it is adequate staff and management time available for each project as appropriate. The Company is also enhancing management oversight to ensure regular engagement of London plc with the project management and operational teams running each of our interests.

 

We also have support with back office including financial accounting and compliance through an external provider.  In addition, we have assistance to manage and coordinate our extensive external communications.

 

We will bring in further bespoke managerial resources as our business expands and our working capital grows. 

 

 

Should Power Metal spin out interests will there be a continuing involvement in management and if so how will that be possible given the management requirements of the core business?

 

It depends on the nature and type of transaction undertaken.  Where needed we will of course apply our management time and other resources to assist. 

 

However, our focus is on ensuring any spin outs or similar are into wrappers or deal structures that come with experienced management able to deal holistically with the commercial challenges without relying too heavily on Power Metal central resources.

 

What measures do you have in place to ensure your management and operations team have due regard for environmental protection and the protection of local communities?

 

This is absolutely vital especially as our business expands its active operations in the field. We already have a keen focus on health and safety, environmental and community protection and that will continue.

 

We seek to follow best practice across the above areas and generally from a corporate governance perspective reflective of the resources available to a smaller company. 

 

To add further weight to this we are currently reviewing a number of trade associations from whom we can secure further support on best practice. 

 

We expect to join trade associations in the near term to further demonstrate our desire to remain proactive in this area.

 

By way of example our Australian JV has just employed a community relations and environment officer as its second employee showing the high priority we give to these matters.

 

 

Financing Strategy

QUESTION

RESPONSE

You have disclosed your working capital position and appear confident you are in a strong financial position, however how reasonable is this given the large spread of projects and work being undertaken on them?

 

The answer revolves around more than just the absolute amount of working capital we hold and also includes how we spend our money, the level of fixed financial commitments and our access to additional working capital sources.  The latter point we deal with in the next question so for now we will focus on the matters of spending and financial commitments.

 

We are quite keen on the control of spending and have our main areas of spend under control.  Much of a junior resource company spend falls into central overhead and exploration spend. When corporately acquisitive, then acquisition costs can also be material.

 

For central overheads the direct costs in relation to the exchange listing and advisors surrounding that are largely fixed and need to be budgeted for. We pay our central costs promptly and carry almost no trade creditors for any material periods.  We have no material debt.

 

Much central cost in junior resource companies relates to director salaries and expenses.  At Power Metal, we believe against our peers in the sector we are modestly paid and have very little outlay for director personal expenses.

 

The aim for us (as holders beneficially interested in approximately 14% of the Company’s issued share capital) is to see money invested in the ground to make exploration and commercial progress including major metal discoveries. 

 

If we do that our shareholdings may rise considerably in value and the financial returns from that would be way more beneficial to directors than excessive board salaries in the early stages of the Company’s development.

 

Turning to exploration spending, for the vast majority of our project spend, our exploration outgoings are flexible and generally entirely at our volition.  This means we can spend if we wish to, but curtail exploration spend across our business if we wish to, for whatever reason.  That spend control is important.

 

Equally for new acquisitions we have always been controlled and not overly exposed ourselves with heavy acquisition terms.  We have used cash as part of acquisition terms but only modestly as cash is king in our sector. 

 

Generally, where possible we have also used our shares for new acquisition vendor payments.  So far that model has worked well to preserve cash and acquire opportunities on reasonable terms (with shared upside for vendors who hold interests in Power Metal stock and benefit as the shares increase in value).

 

Where do you feel most additional working capital will be generated; from financings, warrant exercises or asset disposals?

 

It’s difficult to be precise on future working capital sources but we do have some degree of expectation subject of course to market conditions and buoyancy in the junior resource sector.

 

Power Metal could undertake financings and the Board are confident that money could be raised as required.  This has been amply demonstrated by the £2.7m raised in financings since February 2019 and, save for the initial restructuring in February 2019, Power Metal financings in December 2019 and July 2020 were conducted at the then market price. 

 

Discounted financings are not what Power Metal seeks to undertake as that we consider that potentially damaging for shareholder value and confidence in general.

 

Ideally, we are seeking to build our working capital to become financially self-sustaining.  This would mean that we would not need to undertake financings unless we chose to do so on strong terms or to value-adding institutional investors.

 

Warrant exercises have provided a considerable amount of additional working capital.  The amount raised through warrant exercises since August 2020 has enabled the company to be aggressive with its exploration and corporate plans.  In essence each warrant exercise provides us with funds to accelerate our operational activities.

 

Alongside the above we have a strategic investment portfolio that is growing in value and should that continue, it would provide a source of further working capital should this be needed for operations.

 

The area where we feel considerable working capital could be generated is from spinouts or other similar commercial transactions where we exchange some of our direct ownership of an interest for mainly cash or shares in other entities. 

 

If those entities are liquid listed vehicles, then the effect is to have an asset easily translatable into cash when and if needed to fund our own operations.

 

Can you explain the warrant exercise process, its impact on shareholder dilution and whether there are any restrictions on the warrants?

 

Power Metal receives an exercise form from a warrant holder and checks the validity of this to an underlying warrant register. If acceptable this exercise is reconciled to a receipt of cash into the Company’s bank account.

 

For all valid exercises we secure board approval to issue equity, prepare a market announcement and an AIM admission form for the new equity to be admitted to trading on AIM.

 

The end result is a market announcement confirming the warrant exercises and cash received.

 

The new shares are generated by the registrar and admitted to trading on AIM thereafter. 

 

The warrant exercises increase the issued share capital with such information provided in the requisite market announcement at the time and the increased amount of shares is updated to the Company’s website AIM Rule 26 page on the Investors’ section of the site accordingly.

 

 

Can you provide further information on all outstanding warrants and options to give a better understanding of potential dilution?

 

Details of all warrants issued by the Company can be found in regulatory announcements released by the Company and within the Company’s Financial Report and Accounts.

 

Additionally, the Company will be adding to its new website in due course a full schedule of all financial instruments including all warrants and options held generally by investors and also those held by the board of directors. 

 

This schedule will include all final exercise dates and any special terms including accelerators whereby the company can elect to expedite the use of warrants by holders and if not used, cancel the remainder warrants although, as noted above, all such information can be found within the relevant announcements made by the Company.

 

What amount of revenue do you expect to generate from your projects and how will that revenue be derived?

 

Power Metal is generally seeking capital returns where an increase in the value of projects is secured through exploration or corporate structuring.

 

In some cases that value may be crystallised through a disposal of some or all of a project interest for cash or shares in an acquiring company.

 

In respect of any disposals we are also keen on longer term consideration that could be described as “revenue” including royalties from interests disposed where Power Metal would receive payments should an interest enter production. 

 

Royalties can be a highly valuable source of income or revenue over the longer term so potentially could become a valuable part of our business asset base.

 

In addition, royalty income streams can be sold for material cash sums, providing optionality to Power Metal on how value should be crystallised.

 

When do you anticipate institutional investors will be interested in Power Metal?

 

There are of course institutions of all shapes and sizes, with varying business rationales and many are not suitable partners for our company.

 

We are open to reputable and recognised institutional investment but are also comfortable without it. 

 

Well regarded institutional finance can increase investor confidence in Power Metal, however we are well funded presently and are entirely comfortable with our access to future working capital as outlined in some detail above.

 

 

 

Marketing and Communications

QUESTION

RESPONSE

Can you produce company level and project specific factsheets to help investors understand the business and its constituent elements?

 

The Company intends to undertake this exercise once the website update has been completed.  

Will you be having updated analyst reports prepared for Power Metal?

 

Yes, we expect our brokers will provide updated research to the market as they deem appropriate.

 

 

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

 

 

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale metal discovery.

The Company has a global portfolio of project interests including precious metal exploration in North America and Australia together with base metal exploration in Africa. Project interests range from early stage greenfield exploration to later stage prospects currently subject to drill programmes.

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company’s position to become a leader in the London market for investors wishing to gain exposure to proactive global metals exploration.

Power Metal Resources #POW – Silver Peak Exploration Update

Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to  announce an exploration update from the Silver Peak silver project in British Columbia, Canada.

 

CHIEF EXECUTIVE OFFICER’S STATEMENT

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

“In what continues to be a highly active period at Power Metal Resources, I am pleased to announce the safe completion of a revised drill and sampling programme at the Silver Peak Project notwithstanding very challenging operating conditions as described below.

Our summer due diligence review at Silver Peak clearly highlighted the Project’s potential, as validated by bonanza grade silver (including channel samples yielding up to 14,937 g/t Ag) and significant copper and lead we identified from our summer due diligence channel sampling programme.

We wanted to follow up expeditiously with further work before the weather window closed, gathering additional information to aid preparation for the Project’s next stage of development. To do this we have worked closely with our partners to adapt very rapidly to changeable weather forecasts.

I would like to thank the exploration team for persevering despite the stormy conditions, followed up by snowfall, the heaviness of the latter bringing the work programme to an early conclusion. 

The additional work undertaken by the team has added to our geological understanding of the silver mineralisation and we have secured samples which have now been delivered to the laboratory for assay testing.

Given the highly positive project data, reinforced by exploration to date, we are working closely with our partners to determine next steps for Silver Peak, from both exploration and corporate perspectives. There is palpable demand for high grade silver projects in the market at present.”

SUMMARY OF REVISED DRILL AND SAMPLING PROGRAMME

  • The team undertook a rock chip sampling programme at the Project and despite challenging weather conditions completed six diamond drill holes utilising man-portable drilling equipment to an average depth of 12 feet per hole.
  • Forecast heavy snowfall, resulted in an early cessation of the programme and the team safely left the site, with all equipment and samples collected, before the snows fell.
  • In total 10 diamond core samples   were prepared for testing from the 6 holes drilled and 11 rock chip samples have been prepared from the field work and all samples have been delivered to ALS laboratory in North Vancouver, British Columbia for assay testing.
  • During the programme vital information was collated on the nature of the bifurcating vein system across different levels of the system.  This information will be utilised to develop future project exploration programmes.

EVENTS LEADING INTO THE REVISED PROGRAMME

  • On 22 October 2020 Power Metal announced the signing of the drilling contract for an initial 500m confirmatory diamond core drill programme to test the Victoria Vein at the Silver Peak Project. The Project includes the Eureka-Victoria Silver Mine, the first Crown-granted mineral property in British Columbia.
  • On 30 October 2020 Power Metal announced that the drilling contractor had mobilised the drilling rig, bulldozer and ancillary equipment from northern British Columbia to the local town of Hope where the Silver Peak Project is based and then the planned movement of the drilling rig and support equipment from Hope up the valley, on the upgraded access, to the project and the first drilling pad.
  • The mobilisation was attempted but the area had experienced significant poor weather which caused a degradation in conditions at the project and limited access to the property.  Some of the impacts were dealt with, including the removal of fallen trees, however given the size of the rig and supporting equipment and the conditions encountered it was not considered safe to proceed with the original plan of moving the larger rig up onto the drilling pad.
  • As announced on 10 November 2020 rather than not proceeding and delaying the drill programme entirely Power Metal’s local partners secured smaller man-portable drill equipment and this, together with associated support equipment was installed at the Project and the team commenced drilling.
  • The local team were aiming to drill test at least twenty vein intersections, with hole depths of circa 6m/20 feet (120m of drilling overall) in a 6 to 8-day programme dependent particularly on weather conditions in the Project area.
  • Given the depreciation in local weather, conditions for drilling worsened, and 6 holes were completed to around 60% of planned depth.  Working time on-site was reallocated to the collection of rock chip samples from accessible veins and assessment of the property to gather additional geological information.
  • The team safely left the site due to a forecast of heavy snowfall, with all equipment and rock samples.  The site was subsequently covered in significant snow.

PROJECT BACKGROUND AND EARLIER DUE DILIGENCE PROGRAMME FINDINGS

Background

On 14 September 2020 the Company announced the exercise of an option agreement announced 17 August 2020 (the “Option Agreement”) in respect of the Silver Peak Project, gaining the right to earn-in to a 30% interest in the Project.

Prior to option exercise the Company undertook a due diligence exploration programme including sampling at the Project to gather further information and to assist the Company in its assessment of project prospectivity and potential.

The assay results from the due diligence channel sampling were reported on the 22 September 2020 and are set out in Table 1 below:

Table 1: Summary of assay results for samples taken during Power Metal Due Diligence sampling on Victoria Vein, Silver Peak Project

ALS Global Analytical Method

Ag-GRA22

Ag-CON01

Cu-OG46

Pb-OG46

Sample ID

Channel Sample Length

(m)

Ag

(ppm)

Ag

(ppm)#

Cu

(%)*

Pb

(%)*

SP20-001

0.50

>10,000

10,718

2.14

2.99

SP20-002

0.50

6,010

1.71

2.87

SP20-003

0.50

7,530

1.57

2.07

SP20-004

0.60

5,540

1.38

SP20-005

0.70

7,880

1.94

3.16

SP20-006

0.50

>10,000

14,937

3.05

11.95

SP20-007

0.80

5,330

1.26

SP20-008

0.55

1,595

1.78

SP20-009

0.45

4,110

SP20-010

0.65

1,755

1.71

SP20-011

N/A Grab sample

660

* Cu and Pb results rounded to two decimal places. 

# Two over limit silver samples were analysed >10,000 ppm Ag by method Ag-GRA22 were reanalysed using method Ag-CON01.

Project Overview

The Silver Peak Project consists of a portfolio of mineral claims (the “claims”) over a system of high grade, intrusion related, polymetallic Ag-Pb-Zn-Cu veins, part of the historical Eureka-Victoria Silver Mine, at Silver Peak in southern British Columbia, Canada.

Earlier Due Diligence Exploration Programme

The due diligence work programme previously conducted by Power Metal included various elements including channel sampling at close intervals perpendicular to the existing known high-grade veins and grab samples from a main target area between the lower elevations and the Victoria Adit.

The work also included enhancement of road accessibility to the exploration area, and the collation of detailed photographic and video evidence of the project area for cross referencing to existing project technical information.

A portable X-ray fluorescence analyser (“pXRF”) was utilised to provide in-field, geochemical analyses, in conjunction with confirmatory laboratory assay testing where appropriate.

The due diligence work programme cost totalled C$25,000 (£14,512) and the amount expended will be deducted from Power Metal’s 12 month Project exploration spend commitment of C$250,000.

 

 

COMPETENT PERSON STATEMENT

The technical information contained in this disclosure has been read and approved by Mr Nick O’Reilly (MSc, DIC, MIMMM, MAusIMM, FGS), who is a qualified geologist and acts as the Competent Person under the AIM Rules – Note for Mining and Oil & Gas Companies. Mr O’Reilly is a Principal consultant working for Mining Analyst Consulting Ltd which has been retained by Power Metal Resources PLC to provide technical support.

The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No.596/2014 and is disclosed in accordance with the Company’s obligations under Article 17 of those Regulations.

 

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

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale metal discovery.

The Company has a global portfolio of project interests including precious metal exploration in North America and Australia together with base metal exploration in Africa. Project interests range from early stage greenfield exploration to later stage prospects currently subject to drill programmes.

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company’s position to become a leader in the London market for investors wishing to gain exposure to proactive global metals exploration.

Power Metal Resources #POW – Drilling Commences at Canada Silver Project

Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to announce drilling has commenced at the Silver Peak silver project in British Columbia, Canada.

CHIEF EXECUTIVE OFFICER’S STATEMENT

Paul Johnson Chief Executive Officer of Power Metal Resources plc commented

“I am extremely pleased to announce the commencement of drilling at the Silver Peak project enabling us to secure sample core for laboratory assay testing and complimenting the work undertaken to date including the summer channel sampling which produced bonanza silver grades and significant copper and lead grades.

As you will see below the original drilling plan had to be altered, and we have implemented a different approach using equipment appropriate to the new circumstances.  I thank our partners for their quick thinking adaptability that has enabled a revised drill programme to be implemented.

Given the significant results from the sampling programme we conducted recently we are obviously eager to see the assay results from this drilling programme.”

HIGHLIGHTS:

  • On 22 October 2020 Power Metal announced the signing of the drilling contract for an initial 500m confirmatory diamond core drill programme to test the Victoria Vein at the Silver Peak Project. The Project includes the Eureka-Victoria Silver Mine, the first Crown-granted mineral property in British Columbia.
  • On 30 October 2020 Power Metal announced that the drilling contractor had mobilised the drilling rig, bulldozer and ancillary equipment from northern British Columbia to the local town of Hope where the Silver Peak Project is based and then the planned movement of the drilling rig and support equipment from Hope up the valley, on the upgraded access, to the project and the first drilling pad.
  • The mobilisation was attempted but the area had experienced significant poor weather recently which caused a degradation in conditions at the project and limited access to the property.  Some of the impacts were dealt with, including the removal of fallen trees, however given the size of the rig and supporting equipment and the conditions encountered it was not considered safe to proceed with the original plan of moving the larger rig up onto the drilling pad.
  • Rather than not proceeding and delaying the drill programme entirely Power Metal’s local partners secured smaller man-portable drill equipment and this, together with associated support equipment has been installed at the Project and the team have now commenced drilling.
  • The portable core drill being utilised produces a 48mm core (of similar size to that originally intended from the larger rig) and will be used to test multiple targets initially focused on the top of the lower Victoria portal.
  • The local team are aiming to drill test at least twenty vein intersections in a 6 to 8-day programme dependent particularly on weather conditions in the Project area.
  • Hole depth is expected to be circa 6m (20 feet) as the smaller drill enables collaring to be undertaken close to the vein.
  • As such, the total drill programme is now aiming to complete approximately 120m of drilling rather that the proposed 500m of diamond core drilling as announced on 22 October 2020, with a significant consequent reduction in programme cost.
  • If successfully completed as outlined the drill programme will provide core from more locations across the property than the original programme would have provided.
  • The grade of each core sample will be tested using a handheld X-ray Fluorescence (“XRF”) unit to get an estimate of silver grades prior to assay testing at an accredited local laboratory.

 

FURTHER INFORMATION

Background

On 14 September 2020 the Company announced the exercise of an option agreement announced 17 August 2020 (the “Option Agreement”) in respect of the Silver Peak Project, gaining the right to earn-in to a 30% interest in the Project.

Prior to option exercise the Company undertook a due diligence exploration programme including sampling at the Project to gather further information and to assist the Company in its assessment of project prospectivity and potential.

The assay results from the due diligence channel sampling were reported on the 22 September 2020 and are set out in Table 1 below:

Table 1: Summary of assay results for samples taken during Power Metal Due Diligence sampling on Victoria Vein, Silver Peak Project

ALS Global Analytical Method

Ag-GRA22

Ag-CON01

Cu-OG46

Pb-OG46

Sample ID

Channel Sample Length

(m)

Ag

(ppm)

Ag

(ppm)#

Cu

(%)*

Pb

(%)*

SP20-001

0.50

>10,000

10,718

2.14

2.99

SP20-002

0.50

6,010

1.71

2.87

SP20-003

0.50

7,530

1.57

2.07

SP20-004

0.60

5,540

1.38

SP20-005

0.70

7,880

1.94

3.16

SP20-006

0.50

>10,000

14,937

3.05

11.95

SP20-007

0.80

5,330

1.26

SP20-008

0.55

1,595

1.78

SP20-009

0.45

4,110

SP20-010

0.65

1,755

1.71

SP20-011

N/A Grab sample

660

* Cu and Pb results rounded to two decimal places. 

# Two over limit silver samples were analysed >10,000 ppm Ag by method Ag-GRA22 were reanalysed using method Ag-CON01.

Project Overview

The Silver Peak Project consists of a portfolio of mineral claims (the “claims”) over a system of high grade, intrusion related, polymetallic Ag-Pb-Zn-Cu veins, part of the historical Eureka-Victoria Silver Mine, at Silver Peak in southern British Columbia, Canada.

Earlier Due Diligence Exploration Programme

The due diligence work programme previously conducted by Power Metal included various elements including channel sampling at close intervals perpendicular to the existing known high-grade veins and grab samples from a main target area between the lower elevations and the Victoria Adit.

The work also included enhancement of road accessibility to the exploration area, and the collation of detailed photographic and video evidence of the project area for cross referencing to existing project technical information.

A portable X-ray fluorescence analyser (“pXRF”) was utilised to provide in-field, geochemical analyses, in conjunction with confirmatory laboratory assay testing where appropriate.

The due diligence work programme cost totalled C$25,000 (£14,512) and the amount expended will be deducted from Power Metal’s 12 month Project exploration spend commitment of C$250,000.

 

 

COMPETENT PERSON STATEMENT

The technical information contained in this disclosure has been read and approved by Mr Nick O’Reilly (MSc, DIC, MIMMM, MAusIMM, FGS), who is a qualified geologist and acts as the Competent Person under the AIM Rules – Note for Mining and Oil & Gas Companies. Mr O’Reilly is a Principal consultant working for Mining Analyst Consulting Ltd which has been retained by Power Metal Resources PLC to provide technical support.

The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No.596/2014 and is disclosed in accordance with the Company’s obligations under Article 17 of those Regulations.

 

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

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale metal discovery.

The Company has a global portfolio of project interests including precious metal exploration in North America and Australia together with base metal exploration in Africa. Project interests range from early stage greenfield exploration to later stage prospects currently subject to drill programmes.

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company’s position to become a leader in the London market for investors wishing to gain exposure to proactive global metals exploration.

Power Metal Resources #POW – Canadian Silver Project – Drill Mobilisation Update

Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to  announce a drill mobilisation update from the Silver Peak silver project (the “Silver Peak Project” or the “Project”) in British Columbia, Canada.

HIGHLIGHTS:

· On 22 October 2020 Power Metal announced the signing of the drilling contract for an initial 500m confirmatory diamond core drill programme to test the Victoria Vein at the Silver Peak Project. The Project includes the Eureka-Victoria Silver Mine, the first Crown-granted mineral property in British Columbia. 

· The drilling contractor has now mobilised the drilling rig, bulldozer and ancillary equipment from northern British Columbia to the local town of Hope where the Silver Peak Project is based.

· The drilling rig and support equipment is being moved from Hope up the valley, on the upgraded access, to the first drill pad during the course of today with a view to commencing diamond core drilling before the end of the week. 

CHIEF EXECUTIVE OFFICER’S STATEMENT

Paul Johnson Chief Executive Officer of Power Metal Resources plc commented

“Following the logistics involved with shipping the drilling rig and equipment from northern British Columbia to the local town of Hope and finishing the final access from the road head to the drill pads, the team is mobilising up the valley and orientating the drill rig ready to commence the first hole during the course of today.

This is an exciting time for the Power Metal team and our partners as we launch our first silver focused drill programme.

We are targeting the Victoria Vein where Power Metal due diligence sampling returned bonanza silver grades (up to 480 troy oz/tonne) with significant copper and lead grades. The information which will be secured from this drilling programme will be key to directing the next development steps for the project.

Further updates to market in respect of this exciting silver project opportunity are expected in the near term.”

FURTHER INFORMATION

BackgroundOn 14 September 2020 the Company announced the exercise of an option agreement announced 17 August 2020 (the “Option Agreement”) in respect of the Silver Peak Project, gaining the right to earn-in to a 30% interest in the Project.Prior to option exercise the Company undertook a due diligence exploration programme including sampling at the Project to gather further information and to assist the Company in its assessment of project prospectivity and potential.The assay results from the due diligence channel sampling were reported on the 22 September 2020 and are set out in Table 1 below:Table 1: Summary of assay results for samples taken during Power Metal Due Diligence sampling on Victoria Vein, Silver Peak ProjectALS Global Analytical MethodAg-GRA22Ag-CON01Cu-OG46Pb-OG46Sample IDChannel Sample Length (m)Ag (ppm)Ag (ppm)#Cu (%)*Pb (%)*SP20-0010.50>10,00010,7182.142.99SP20-0020.506,010
1.712.87SP20-0030.507,530
1.572.07SP20-0040.605,540
1.38
SP20-0050.707,880
1.943.16SP20-0060.50>10,00014,9373.0511.95SP20-0070.805,330
1.26
SP20-0080.551,595
1.78
SP20-0090.454,110

SP20-0100.651,755
1.71
SP20-011N/A Grab sample660

* Cu and Pb results rounded to two decimal places.  # Two over limit silver samples were analysed >10,000 ppm Ag by method Ag-GRA22 were reanalysed using method Ag-CON01.
Project OverviewThe Silver Peak Project consists of a portfolio of mineral claims (the “claims”) over a system of high grade, intrusion related, polymetallic Ag-Pb-Zn-Cu veins, part of the historical Eureka-Victoria Silver Mine, at Silver Peak in southern British Columbia, Canada.
Earlier Due Diligence Exploration Programme The due diligence work programme previously conducted by Power Metal included various elements including channel sampling at close intervals perpendicular to the existing known high-grade veins and grab samples from a main target area between the lower elevations and the Victoria Adit. The work also included enhancement of road accessibility to the exploration area, and the collation of detailed photographic and video evidence of the project area for cross referencing to existing project technical information. A portable X-ray fluorescence analyser (“pXRF”) was utilised to provide in-field, geochemical analyses, in conjunction with confirmatory laboratory assay testing where appropriate. The due diligence work programme cost totalled C$25,000 (£14,512) and the amount expended will be deducted from Power Metal’s 12 month Project exploration spend commitment of C$250,000. 

COMPETENT PERSON STATEMENT

The technical information contained in this disclosure has been read and approved by Mr Nick O’Reilly (MSc, DIC, MIMMM, MAusIMM, FGS), who is a qualified geologist and acts as the Competent Person under the AIM Rules – Note for Mining and Oil & Gas Companies. Mr O’Reilly is a Principal consultant working for Mining Analyst Consulting Ltd which has been retained by Power Metal Resources PLC to provide technical support.

The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No.596/2014 and is disclosed in accordance with the Company’s obligations under Article 17 of those Regulations.

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

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale metal discovery.

The Company has a global portfolio of project interests including precious metal exploration in North America and Australia together with base metal exploration in Africa. Project interests range from early stage greenfield exploration to later stage drill ready prospects.

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company’s position to become a leader in the London market for investors wishing to gain exposure to proactive global metals exploration.

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