TIDMPOW
RNS Number : 2503Y
Power Metal Resources PLC
12 January 2022
12 January 2022
Power Metal Resources PLC
("Power Metal" or the "Company")
Tati Project Botswana - Prospecting Licences Received
Prospecting Licences Covering the Tati Project Successfully
Transferred to Power Metal's 100% Subsidiary Tati Greenstone
Resources Pty Limited - Issue of Equity to Vendors
Power Metal Resources plc (LON:POW), the London listed
exploration company seeking large-scale metal discoveries across
its global project portfolio, announces that the two Prospecting
Licences ("PLs") comprising the Tati Project ("Project") have now
been successfully transferred into Tati Greenstone Resources Pty
Ltd ("TGR"), a wholly-owned private Botswana-based subsidiary of
Power Metal.
Paul Johnson Chief Executive Officer of Power Metal Resources
plc commented:
"This is an extremely poignant moment for Power Metal, with the
successful transfer of PLs securing Power Metal's first 100% owned
project in mining friendly Botswana.
We are grateful for the support of the Vendors and the local
authorities in Botswana during this transfer process and also to
our in-Country team members who have been key to the establishment
of our local holding company and to various operations on the
ground.
We have been highly proactive at the Tati Project, with multiple
2021 exploration programmes implemented which have identified
multiple large-scale gold and nickel-in-soil anomalies, some of
which we targeted during the recent reverse circulation drilling
programme.
We very much look forward to the receipt of the assay results
from the drilling programme and further steps with this exciting
100% owned opportunity."
BACKGROUND
On 28 July 2021 Power Metal exercised an option (the "Option")
to acquire a 100% interest in the Tati Project, and the process was
commenced to transfer the two Project PLs ( PL 126/2019 and PL
127/2019) , into Power Metal's wholly owned Botswana
subsidiary.
The Option exercise announcement may be viewed through the
following link:
https://www.londonstockexchange.com/news-article/POW/tati-project-botswana-option-exercised/15075700
HIGHLIGHTS
-- Power Metal, through its wholly-owned subsidiary, TGR, now
has a 100% interest in the Tati Project with the successful
transfer of PL 126/2019 and PL 127/2019 to TGR from the
Vendors.
-- The district-scale PL126/2019 and PL127/2019 licences cover
an area of 35km2 and 89km2 respectively; the PLs were established
10 October 2019 and grant an exclusive prospecting right to the
owner for a period of 3 years ending 30 September 2022. Power Metal
intends to satisfy the third-year expenditure requirements and seek
renewals for both licences later in the year.
-- With the PLs transferred the Tati Project becomes the
Company's first wholly-owned Botswana based project where
large-scale gold and nickel discoveries are being targeted.
-- The successful transfer triggers certain share and warrant
issuances to the Vendors, further details of which are provided
below.
-- Initial exploration conducted by the Company in 2021
highlighted five target areas across the two PLs which are defined
by kilometre-scale geochemical anomalies that are coincident with
various geological structures that were highlighted by ground
geophysical surveys.
-- Following successful initial exploration, the Company
recently completed a maiden drill programme at the Tati Project
comprising 23 reverse circulation ("RC") drillholes for a total
1,092m drilled. The RC holes tested multiple nickel and gold
targets across the PLs.
-- RC samples were shipped to Johannesburg for sample
preparation at Intertek Genalysis ("Intertek") preparatory
facility, and have since been shipped and received in Perth,
Australia, at Intertek's laboratory where they are undergoing
analysis. Results from all RC samples are still pending and are
expected in the near term.
LICENCE TRANSFER - TRANSACTION TERMS
Vendor:
Vital Commodities Pty Ltd, a company registered and Incorporated
in Botswana ("VC") VC is a private Botswana company that held the
two PLs comprising the Tati Project (the "Vendors"). VC is 100%
owned by Equity Drilling Limited, a company registered and
incorporated in Guernsey.
Terms:
Note the Option fee in respect of this transaction was a cash
payment of GBP50,000 to the Vendors as originally announced on 6
May 2021 which has been paid. The full amount of GBP50,000 paid
(the "Offset Payment") may be credited and offset from the cost of
the drilling undertaken by Equity Drilling Limited (100% owner of
VC) who have a right to quote for drilling work on the PLs until 30
September 2022 or at other Power Metal held interests in
Botswana.
Following transfer of PL 126/2019 and PL 127/2019 into Power
Metal's Botswana wholly-owned subsidiary TGR the following
consideration shares and warrants have become due and payable:
- Power Metal will now pay consideration of GBP25,000, payable
through the issue to the Vendors of 833,333 new ordinary Shares of
0.1p each in the Company ("New Ordinary Shares") at an issue price
of 3.0 pence per New Ordinary Share ("Initial Exercise
Shares").
- Power Metal has also elected to proceed with the year 3
exploration spend programme (for the year ending 30 September 2022)
and will now pay a further consideration of GBP50,000, to the
Vendors through the issue of 833,333 New Ordinary Shares at an
issue price of 3.0p each for each licence, resulting in 1,666,666
New Ordinary Shares to be issued (the "Further Exercise
Shares").
Additionally, the Company shall now issue to the Vendors
5,833,332 warrants over New Ordinary Shares (the "Vendor Warrants")
in two separate tranches of 2,916,666 warrants each as follows:
- 2,916,666 Vendor Warrants shall be issued enabling the Vendors
to acquire 2,916,666 New Ordinary Shares at an exercise price of 5p
per share, exercisable over a 2-year period from 6 May 2021 and
which are only exercisable on completion of exploration drilling
against which the GBP50,000 Offset Payment has been credited (the
"5p Vendor Warrants"). To date, GBP25,000 of the GBP50,000 Offset
Payment has been credited.
The 5p Vendor Warrants shall be subject to a 5-day VWAP
accelerator, by which should Power Metal shares trade above 10p for
5 trading days then the Company shall have the right to serve
notice on VC that it must exercise and pay for the exercised 5p
Vendor Warrants within 14 calendar days or the 5p Vendor Warrants
shall be cancelled.
- 2,916,666 Vendor Warrants shall also be issued enabling the
Vendors to acquire 2,916,666 New Ordinary Shares at an exercise
price of 7.5p per share, exercisable over a 2-year period from 6
May 2021 and which are only exercisable on completion of
exploration drilling against which the GBP50,000 Offset Payment has
been credited (the "7.5p Vendor Warrants").
The 7.5p Vendor Warrants shall be subject to a 5-day
volume-weighted average price ("VWAP") accelerator, by which should
Power Metal shares trade above 15p for 5 trading days then the
Company shall have the right to serve notice on VC that it must
exercise and pay for the exercised 7.5p Vendor Warrants within 14
calendar days or the 7.5p Vendor Warrants shall be cancelled.
In addition to the above, Power Metal will pay a single further
deferred consideration payment of GBP100,000 through the issue to
the Vendors of 3,333,333 New Ordinary Shares at an issue price of
3.0p ("Final Exercise Shares") if either of the two following
conditions are met:
- (1) Confirmation of a 250,000 oz Au JORC (2012) compliant gold
Mineral Resource across the two prospecting licences
- (2) Confirmation of a 5,000,000 tonne economic nickel deposit at a grade of >1.5% nickel.
Up to 30 September 2022 Power Metal will engage VC to quote for
all drilling activities undertaken on PL 126/2019 and PL
127/2019.
The Vendors and their professional licensing and geological
teams will continue to work with Power Metal to manage licences and
third-party relationships, undertake ground exploration and to help
where appropriate to further build the licence footprint in
Botswana. Reasonable commercial terms will be agreed for any
additional work undertaken.
TATI GREENSTONE BELT INFORMATION
The Tati Greenstone Belt ("TGB") is located in the vicinity of
Francistown, adjacent to the Zimbabwe border, in north-eastern
Botswana. With a total strike length of 65km and up to 20km in
width the TGB hosts a large number of orogenic style gold deposits
and several economically significant intrusive magmatic
nickel-copper-platinum group elements ("Ni-Cu-PGE") rich sulphide
deposits.
A gold rush started at Tati in 1867 leading to the establishment
of Francistown and over 70 reported small scale gold mining
operations.
The TGB is Botswana's only gold producing region with the Mupane
gold mine (held by Galane Gold Ltd) being the country's only major
gold producer. Mupane was formerly an open-pit operation and is now
an underground mine. It is located in the southern part of the
TGB.
The known nickel deposits on the greenstone belt consist almost
entirely of disseminated to semi massive sulphide bodies hosted by
a series of late stage gabbroic-troctolitic intrusive bodies.
Significant nickel operations operated until 2016, including the
former Tati Nickel Mining's Selkirk underground mine which
commenced production in 1989 and the Phoenix open pit which started
in 1995. Both deposits are located in the south-central portion of
the TGB.
Geologically the TGB is part of the Francistown Arc Complex
within the southern margin of the Archean age Zimbabwe Craton in
the northern contact zone of the Limpopo Belt. The principal
lithologies of the TGB are lower greenschist to lower amphibolite
facies volcanic and sedimentary rocks, constrained by three
fault-bounded volcano-plutonic sequences which are intruded by
granitoids.
Whilst there is a long history of small scale gold mining on the
TGB, the Company believes it to be under explored by modern
standards and systematic exploration focussing on areas with sand
cover and geophysics targeting greater depths are likely to yield
further gold and nickel discoveries.
GLOSSARY
Orogenic Gold (Deposits) - Gold deposits found within
metamorphic belts which form as a result of major crustal
deformation events.
Intrusive Magmatic Nickel (Deposits) - Nickel deposits found at
the base of large mafic and ultramafic intrusive bodies.
PGE - Platinum group elements (ruthenium, rhodium, palladium,
osmium, iridium, and platinum)
Mafic Intrusive Unit - Igneous rock that is dominated by
magnesium and iron rich silicate minerals including pyroxene,
amphibole, olivine, and mica.
ADMISSION AND TOTAL VOTING RIGHTS
Application will be made for the 2,499,999 Initial and Further
Exercise Shares to be admitted to trading on AIM which is expected
to occur on or around 19 January 2022 ("Admission"). The Initial
and Further Exercise 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 1,444,339,986 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.
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 company which finances and manages global resource
projects and is seeking large scale metal discoveries.
The Company has a principal focus on opportunities offering
district scale potential across a global portfolio including
precious, base and strategic 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.
Power Metal will develop projects internally or through
strategic joint ventures until a project becomes ready for disposal
through outright sale or separate listing on a recognised stock
exchange thereby crystallising the value generated from our
internal exploration and development work.
Value generated through disposals will be deployed internally to
drive the Company's growth or may be returned to shareholders
through share buy backs, dividends or in-specie distributions of
assets.
Power Metal Exploration Programmes Underway/Results Awaited
Power Metal has exploration programmes completed or underway,
with results awaited, as outlined below:
Project Location POW % Work Completed Results Awaited
or Underway
Alamo Gold USA Earn-in Excavation of multiple Field and assay
Project to 75% test pits and mapping results from on-site
& sampling. work programme.
---------- ---------- ------------------------ ----------------------
Authier North Canada Earn-in Soil & rock sampling Laboratory assay
Lithium to 100% completed results of samples
collected
---------- ---------- ------------------------ ----------------------
Ditau Project Botswana 50% Preparatory exploration Field programme
work underway on findings and defined
target I10 leading drill targets for
to planned accelerated near term drilling.
drilling targeting
rare-earth elements
and base metals
---------- ---------- ------------------------ ----------------------
Kalahari Copper Botswana 50% Exploration programme Field programme
Belt underway across findings and defined
the South Ghanzi drill targets for
Project and further near term drilling
exploration at
the more recently
acquired South
Ghanzi Extension
and Mamuno licence
areas
---------- ---------- ------------------------ ----------------------
Molopo Farms Botswana 53%(1) Kavango Option Results from various
to acquire an interest work activities
in local project underway as part
holding company. of the Kavango
Option fee payable Option
through defined
work programme
---------- ---------- ------------------------ ----------------------
Tati Gold/Nickel Botswana 100% Reverse circulation Laboratory assay
drill programme results awaited
completed
---------- ---------- ------------------------ ----------------------
H aneti Project Tanzania 35% Diamon drill programme Results from field
underway programme including
drill programme
underway
---------- ---------- ------------------------ ----------------------
Victoria Goldfields Australia 49.9% Ongoing exploration Results from field
across 848km(2) programme including
of granted exploration drill programme
licences underway
---------- ---------- ------------------------ ----------------------
Wallal Gold/Copper Australia 83.33%(2) Passive seismic Results awaited
Project and 2D seismic
processing work
programme completed.
Ground reconnaissance
work underway.
---------- ---------- ------------------------ ----------------------
(1) should Kavango exercise their option to acquire Kalahari
Key, Power Metal interest would reduce to 40% of the Molopo Farms
Complex project
(2) assuming all licences held by URE Metals Pty Limited are
granted as outlined in the Company's announcement of 19.11.21
resulting in the issue of First Development Resources Ltd shares to
URE vendors
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