TIDMPOW
RNS Number : 3918Q
Power Metal Resources PLC
25 February 2021
25 February 2021
Power Metal Resources PLC
("Power Metal" or the "Company")
Exercise of Ontario Options - Magical and Enable Properties
Power Metal Resources PLC (LON:POW) the AIM listed metals
exploration and development company is pleased to announce that
following due diligence work the Company has exercised its option
to acquire both the Magical Property ("Magical") and Enable
Property ("Enable" together the "Properties") located on the
prospective Schreiber-Hemlo Greenstone Belt in north-western
Ontario, Canada.
These are the final two of four gold exploration properties upon
which the Company signed an exclusive option to acquire a 100%
interest (as announced 26 January 2021) and follows the McKellar
option exercise and the Coco East option exercise which were
announced on 18(th) and 24(th) February 2021 respectively.
Paul Johnson Chief Executive Officer of Power Metal Resources
plc commented:
"The exercise of our options over the Magical and Enable
properties concludes Power Metals' current acquisition strategy
over the Schreiber-Hemlo Greenstone Belt in Ontario. Power's
portfolio of exploration properties provides us the opportunity to
build value, within a 120km strike length, of a prolific
exploration belt.
We will now commence a phase of desk-based remote sensing
targeting and exploration planning with a view to being in a
position to initiate ground reconnaissance and target follow-up
work after the snow thaw. We look forward to providing further
updates as plans progress."
MAGICAL PROPERTY OVERVIEW
- Magical is located 9km northwest of Barrick Gold Corporation's
Hemlo Mine which has produced more than 21Moz gold and has been
operating continuously for more than 30 years(1) .
- The property is located upon the North Limb of the
Schreiber-Hemlo Greenstone Belt, the property is located at the
prospective contact between the intrusive Gowan Lake Pluton and
metavolcanic/metasedimentary rock packages, with a similar
geological setting to the Hemlo deposit. Magical offers potential
for orogenic style gold mineralisation.
- The regional geophysics data shows a north trending regional
scale magnetic structure intersects the intrusion within the centre
of the property, defining a preliminary target for
investigation.
- Magical is largely unexplored apart from the easternmost Claim
cell where, in 1995, Hemlo Gold Mines Inc drilled an induced
polarisation ("IP") geophysics anomaly. Diamond drill hole V95-2
reportedly intersected a 7m zone of silicification containing
sericite and sulphides and 12.6m of feldspar porphyry with
disseminated pyrite.
- Magical directly abuts and covers the westward strike
extension of the Canadian listed junior Hemlo Explorers Inc (TSX-V:
HMLO) North Limb Property(2) .
MAGICAL CLAIM STATUS
- The Magical property consists of a total of 14 Single Cell
Mining Claims ("Claims") covering an area of circa 3.0km(2) .
- Claims are valid through to 27 July 2022 upon which they can
be renewed on an annual basis. For renewal the Magical Claims will
require an aggregate work spend of CAD$5,600 (circa GBP3,145) prior
to the individual Claim renewal dates.
ENABLE PROPERTY OVERVIEW
- The Enable property is located on the western part of the
Schreiber-Hemlo Greenstone Belt, at the contact of metavolcanic and
volcano-sedimentary rock packages with the Terrace Bay
Batholith.
- On a regional scale the Terrace Bay Batholith contact is
spatially associated with at least 28 documented gold showings
including the Northshore Property which has historical resources of
1.2Moz Au(3) . Northshore has recently been subject to open pit
mining studies and is currently held by Canadian Securities
Exchange listed Ready Set Gold Corp. (CSE:RDY).
- Overburden cover has been attributed to the reason the Enable
portion of the batholith contact remains unexplored. This presents
an opportunity to discover new gold mineralisation utilising modern
exploration technologies.
- Access to the property is good, being 4km north of the town
and railway stop of Terrace Bay and with the Trans-Canada Highway
running within 200m of the eastern boundary. The centre of the
property is crossed by a public highway with logging roads and a
lake providing access to the western part of the property.
ENABLE CLAIM STATUS
- The Enable property consists of a total of 41 Claims covering an area of circa 8.7km(2) .
- Claims are valid through to 25 July 2022 upon which they can
be renewed on an annual basis. For renewal the Enable Claims will
require an aggregate work spend of CAD$16,400 (circa GBP9,210)
prior to the individual Claim renewal dates.
ACQUISITION TERMS
The vendors of the Option (the "Vendors") are a consortium led
by established local prospector Brian Fowler who was the Vendor of
the Hemlo North Gold Project acquired by Power Metal as announced
on 21 January 2021.
In exercising the Option to acquire a 100% interest in the
Magical and Enable properties POW will make the following cash and
equity consideration:
Property Name Cash (CAD$) POW Shares Note: POW Total Consideration
(CAD$) Acquisition (CAD$)
Shares to
be issued
Magical 20,000 20,000 384,000 40,000
------------ ----------- ------------- --------------------
Enable 30,000 30,000 576,000 60,000
------------ ----------- ------------- --------------------
The POW shares payable as consideration are new ordinary shares
of 0.1p each in the Company at an issue price of 3.0 pence per
share ("Acquisition Shares"). The cash costs of the acquisition are
funded from Power Metal's existing Canadian Dollar cash
account.
The Vendors retain a 2% net smelter royalty ("NSR") on each
property, Power Metal may purchase 1% of each NSR, at any time, by
making a cash payment to the Vendors of CAD$500,000.
The Vendors will continue to work with Power Metal in the local
management of any new properties acquired through this transaction;
the development and implementation of exploration plans and the
identification of further new opportunities.
EXPLORATION PLAN
- Ongoing exploration spend will be at the discretion of Power
Metal as the 100% owner of the properties.
- Preliminary exploration work is expected to include both
remote sensing data interpretation and ground-based fieldwork with
systematic soil sampling and geophysics expected to yield defined
targets for future drill testing.
- The Province of Ontario has an established mineral exploration
industry with a large number of local exploration contractors that
could be engaged to fulfill the planned work on a cost-effective
basis.
Admission and Total Voting Rights
Application will be made for the 960,000 Acquisition Shares to
be admitted to trading on AIM, which is expected to occur on or
around 4 March 2021 ("Admission"). The Acquisition 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 1,136,877,930 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.
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.
Reference Sources
1: Barrick Gold Corporation, Hemlo Project webpage:
https://www.barrick.com/English/operations/hemlo/default.aspx
2: Hemlo Explorers Inc (TSX-V: HMLO) North Limb Property
webpage:
https://hemloexplorers.ca/projects/hemlo-north-limb/overview/
3: Mineral resource estimate: Technical Report on the Mineral
Resources of the Northshore Property, Thunder Bay Mining Division,
Priske Township, Ontario, Canada with an effective date of 28 April
2014, by Giroux Consultants Ltd. and Minorex Consulting
Limited.
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 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.
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END
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