Power Metal Resources plc (LON:POW) the AIM listed African focused metals exploration and development company is pleased to provide an update in respect of the Haneti Nickel Project (“Haneti” or the “Project”).
POW has established a joint venture (“JV”) with Katoro Gold (LON:KAT) in respect of Haneti, (the “Haneti JV”). POW has a 25% interest in the Haneti JV with a right to increase to a 35% interest through a cash payment of £25,000 to Katoro, until 15 May 2020. Katoro has a 75% interest in the Haneti JV. POW will contribute 25% to the cost of Haneti Project maintenance and exploration or will dilute in accordance with standard industry provisions.
POW also holds 10,000,000 shares in Katoro representing 5.95% of Katoro’s issued share capital.
Paul Johnson, Executive Director of Power Metal Resources plc commented: “The decision to drill the Haneti Nickel project, targeting nickel, copper and PGM mineralisation is an acutely significant event for both JV partners.
The two initial targets are substantial and have been selected following an extensive exploration programme involving a combination of airborne and ground exploration techniques to identify, consolidate and pinpoint the drill programme.
The upcoming drill programme is an efficient start to our JV work at Haneti and fits with the Company’s strategic objective to discover large scale mineral deposits.”
Background to the Haneti Nickel Project
Haneti, is a highly prospective, nickel sulphide asset in Tanzania. Development of Haneti is being advanced in tandem with its joint venture partner, Katoro Gold plc (LON:KAT).
The joint venture partners have been undertaking a review of all historic work completed on the 5,000 sq. km polymetallic Project and believe that it could host a chonolith type nickel sulphide deposit.
Previous exploration work has been undertaken at Haneti to a value of approximately US$1.5 million. This included exploration by former project owner Kibo Energy Plc (LON:KIBO) up to the end of 2012 over the Haneti-Itiso Ultramafic Complex (“HIUC”) and comprised of rock sampling soil sampling, geological mapping, trenching, geophysical surveys and petrographic analyses.
This work identified grades of up to 13.59% nickel in rock samples with additional gold, cobalt, platinum values and some significant lithium anomalies. Additionally, independent work, undertaken by Western Geophysics Pty, underlined the potential of Haneti to host a substantial nickel sulphide deposit.
In 2012/13, the Geological Survey of Tanzania (‘GST’) conducted a high resolution airborne geophysical survey covering an area of approximately 12,000 sq. km. The GST survey outlined mafic-ultramafic zones with strike lengths of 10-20km (northwest zone), 30km (southwest zone) and 80km (central zone), extending the footprint of the known nickel sulphide prospective HIUC.
Haneti lies within the ground area covered by the HIUC and, following the findings above, was subject to an independent geochemical interpretation, which identified the Mihanza Hill area as a prime drill target for nickel, copper and PGM mineralisation.
The findings from the geochemical interpretation report and the in-house review thereon was sent to Perth based geophysical consultants, Spinifex Geophysics Pty Ltd, for detailed processing and interpretation to better understand the geology of Haneti and to generate new target areas particularly for nickel, copper and PGM style mineralisation.
A follow up extensive soil sampling programme was then undertaken, the results of which were announced by Katoro on 20 May 2019. This extended the strike length of previously identified high priority areas and the findings have been utilised to inform planning for a proposed drill programme. Furthermore, it also identified a new, previously unidentified exploration target.
Following further review of the accumulated work undertaken, the JV partners have agreed to immediately implement a drill programme at two of the Project’s key targets: Mihanza Hill and Mwaka Hill.
At the primary target, Mihanza Hill, a high magnetic anomaly was modelled using a 3D inversion modelling technique to better understand how the magnetic signature varied with depth. The results indicate that there is a considerable ‘root’ to the Mihanza Hill ultramafic outcrop, which points to a large volume of rock that could have positive implications for the differentiation of nickel sulphide rich magmas and provides a large volume of nickel prospective target rock at this location.
The main objective of the 2019 exploration work programme will be to ascertain the existence of disseminated or massive sulphide mineralisation at the identified high priority exploration targets. Using a variety of exploration techniques, the programme will seek to define a future drilling programme. Further information regarding this programme, including more extensive information on the drilling methodology and additional geological rationale for the targets selected for drilling, will be provided in due course.
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.
26 June 2019