Power Metal - Option Signed - Australia Copper-Gold Acquisition
Power Metal Resources PLC
("Power Metal" or the "Company")
Option Signed - Australia Copper-Gold Acquisition
Power Metal Resources PLC (LON:POW) the AIM listed metals exploration and development company is pleased to announce the Company has secured an exclusive 60-day option (the "Option") in respect of a potential new acquisition of copper-gold focused exploration interests in the
The area also has developed mine and processing infrastructure due to the presence of established mining operations, including Newcrest Mining's
"Power Metal is keen to build its exposure to Australian base and precious metals exploration where there is, in our view, the potential for large scale metal discoveries in a secure and stable operating environment.
Through our joint venture in the Victoria Goldfields, and subject to due diligence, through this acquisition, we will have operating interests in two of the major centres for exploration activity in
The level of interest in the
Power Metal is positioning itself to develop a diverse and expansive exploration business in
- Power Metal has signed an Option agreement (the "Option Agreement") to acquire a 100% interest in First Development Resources PTY Ltd ("FDR"), an Australian private company holding the Wallal Project and an option to acquire the Ripon Hills Project, (ownership structure as outlined below).
- The Option Agreement provides a 60 business-day option period, during which Power Metal may undertake due diligence, and the terms for option exercise to acquire 100% of FDR from its current shareholders (the "Vendors").
- The Option Agreement fee of
FDR and its Business Interests:
- FDR holds two projects interests; the Wallal Project and the Ripon Hills Project.
- The Wallal Project currently 100% owned by FDR comprises E45/5816 an exploration licence application covering 390km2 in the western quadrant of the
- FDR also has a right to acquire 100% of the Ripon Hills Project from Great Sandy Pty Ltd ("Great Sandy") a private Australian Company, (with consideration for the transfer being satisfied by Great Sandy nominees receiving a proportion of consideration outlined below under "Upon Option Exercise".) The Ripon Hills Project comprises E45/5088 a granted exploration licence covering 42km2 prospective for base metal-gold mineralisation and is proximal to Rumble Resources' (ASX: RTR) Braeside Project where significant new base metal discoveries have been made.
Upon Option Exercise:
- Should Power Metal at its sole volition exercise the Option for the acquisition of FDR the Company will pay initial consideration of
- In addition, Power Metal will issue the Vendors 5 million warrants with an exercise price of 4.5p per new Ordinary Share and life to expiry of 3 years from the date of Option exercise ("Initial Exercise Warrants"). Should the volume weighted average price ("VWAP") of Power Metal shares meet or exceed 7.0
- Upon grant of exploration license application E45/5816 (Wallal Project) and the transfer of the granted exploration license E45/5088 (Ripon Hills Project) into FDR a further
- In addition, upon the grant of exploration license application E45/5816 (Wallal Project) and the transfer of the granted exploration license E45/5088 (Ripon Hills Project) into FDR, Power Metal will issue the Vendors 2,857,143 warrants with an exercise price of 5p per new Ordinary Share and life to expiry of 3 years from the date of Option exercise ("Grant Warrants"). Should the volume weighted average price ("VWAP") of Power Metal shares meet or exceed 10.0
- The Vendors will retain a 2% net smelter royalty ("NSR") over the licence application E45/5816 and granted licence E45/5088 and Power Metal will have the right to purchase 1% of this NSR for
- The consideration items outlined above, on Option exercise, will not be paid until the regulatory approvals have been received including any such approval required from the Foreign Investment Review Board,
- The Vendors and their professional licensing and geological teams will continue to work with Power Metal following Option exercise to undertake ground exploration and to further build the licence footprint in the
Wallal Project - E45/5816 - Exploration Licence Application
The Wallal Project comprises a large, well located 390km2 area, in the western quadrant of the
The tenure covers an area of transported sand cover including linear north west-south east trending aeolian dunes. Furthermore, the Wallal Project is located on an interpreted basin bounding structure known as the Wallal embayment.
Interestingly, the geology on the eastern boundary of the Wallal Project - associated with a 'gravity ridge' geophysical anomaly - is similar to the structural setting of Rio Tinto's Winu discovery (the
It is envisaged that potential drilling targets might be identified utilising high precision gravity, seismic and magnetic survey techniques focussing on specific zones within the apparent gravity ridge.
Ripon Hills Project - E45/5088 - Granted Exploration Licence
The Ripon Hills Project (42km2) contains outcropping Carawine Dolomite rocks of the Archaean Hamersley Group overlying rocks of the Fortescue Group. Furthermore, the Ripon Hills Project is considered prospective for base metal-gold mineralisation associated with deep seated north to north west trending fault structures, as they have the potential to be conduits for various styles of hydrothermal mineralisation.
Ripon Hills is proximal to Rumble Resources' (ASX: RTR) Braeside Project where significant new base metal discoveries have been made5. Specifically, this is a regional scale, 60km long, fracture zone containing porphyry to epithermal mineralised systems with 45 priority Cu-Au-Zn-Pb-Ag targets and five deposit types delineated. Encouragingly, this materially enhances the prospectivity of the Ripon Hills Project, which is largely under-explored, as the underlying geology is similar.
Notably, the priority exploration targets within the Ripon Hills Project are interpreted north to north westerly striking deep seated fault structures. Further, these targets have the potential to host various styles of hydrothermal base metal and gold mineralisation, similar to what is apparent in the Braeside Project. Interestingly, mineralisation can occur in the underlying Fortescue Group rocks as well as the Carawine Dolomite.
Having a footprint in the world class
Using an array of modern exploration techniques, comprising reconciling geophysics and geochemical surveys, the exploration would seek to efficiently and cost effectively identify priority test-drill targets.
In the 6 months ended
ADMISSION AND TOTAL VOTING RIGHTS
Application will be made for the 1,000,000 Option Shares to be admitted to trading on AIM, which is expected to occur on or around
Following Admission, the Company's issued share capital will comprise 1,056,218,972 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
Source 1: Rio Tinto PLC announcement https://www.riotinto.com/en/news/releases/2020/Rio-Tinto-reveals-maiden-Resource-at-Winu-and-new-discovery
Source 2: Greatland Gold PLC announcement https://polaris.brighterir.com/public/greatland_gold/news/rns/story/wkqm9ow
Source 3: Newcrest Mining Ltd : https://www.newcrest.com/our-assets/telfer
Source 4: Metals X Ltd: https://www.metalsx.com.au/copper/
Source 5 : Rumble Resources Ltd: http://rumbleresources.com.au/braeside_project.php
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
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+44 (0) 7766 465 617
SP Angel Corporate Finance (Nomad and Joint Broker)
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+44 (0) 20 3470 0470
SI Capital Limited (Joint Broker)
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+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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