Completion of Strategic and Operational Review
Power Metal Resources plc (LON:POW) the AIM listed African focused metal exploration and development company is pleased to confirm the completion of the Company’s strategic and operational review.
- Strategic and operational review, commenced in February 2019, now complete and all key restructuring activities essentially complete;
- Power Metal Resources to remain focused on large scale metal discoveries with a focus on nickel, copper and cobalt;
- Company to continue proactive exploration activities in Botswana, Cameroon, the DRC and Tanzania;
- Paul Johnson becomes Chief Executive Officer of the Company with immediate effect.
Paul Johnson, Chief Executive Officer of Power Metal Resources plc commented: “The key strategic objective of Power Metal Resources is to make large scale metal discoveries in the power metal commodities, principally nickel, copper and cobalt.
I am pleased to be given the opportunity to take the role of Chief Executive Officer and with the support of the team, and shareholders, I intend to make a long-term commitment to building Power Metal Resources into one of the strongest exploration and development companies in London.
In line with this objective we have made a great start in recent months with exploration success in Cameroon (cobalt) and the DRC (copper), where both projects have to date exceeded our expectations.
The Company has also added new operational activities in Botswana and Tanzania, predominantly nickel focused, and where all results achieved to date have been highly encouraging.
I would like to thank my fellow directors and our advisory team for their vital help and support so far in 2019 and also our shareholders, including those who have held for a long period and more recent holders. Junior resource exploration is high risk and at times holding shares can be a tortuous process, not least when sector conditions are very challenging.
With a fair wind I trust we will deliver the level of returns that justify your investment.”
STRATEGIC AND OPERATIONAL REVIEW
- The key strategic objective of Power Metal Resources is to make large scale metal discoveries in the power metal commodities, principally nickel, copper and cobalt;
- At present the Company’s operational interests are African based however the Company may acquire interests outside Africa should compelling opportunities arise in the future;
- In addition, the present focus on the power metal commodities suite of nickel, copper and cobalt is expected to continue although the Company is open to other commodity opportunities should projects prove compelling;
- The Company is focused on large scale targets and the application of innovative and cost effective exploration techniques to control costs while maximising the chance of a discovery or discoveries;
- At present the Company has a diverse business model with multiple project interests and may in time focus the resources of the business more aggressively toward a project or projects within our portfolio where accelerated development is justified;
- The Company will seek to maintain an external dialogue with larger organisations with a view to project farm-in, joint venture or disposal, where such steps could materially improve the value of a project in the interest of shareholders.
Original Project Operations (held by the Company as at February 2019):
- In February 2019 the Company had original operations in three countries, Cameroon, the Democratic Republic of the Congo (“DRC”) and the Ivory Coast;
- Since February we have successfully relaunched active exploration operations in Cameroon and the DRC, with significant advancement at both projects achieved in recent months;
- In Cameroon the Company has confirmed its 100% owned project licenses share a similar geology to the nearby substantial Nkamouna cobalt deposit;
- In the DRC the Company has identified a 6.8km copper anomaly running through the heart of its 70% owed Kisinka copper-cobalt license;
- Additional work programmes will be undertaken in Cameroon and the DRC projects, reflecting their clear strategic importance to Power Metal Resources;
- The Company remains in discussions with the vendors of the Lizetta II chrome-nickel-cobalt project in the Ivory Coast and is reviewing the potential development options for that project.
- Since February 2019 the Company has acquired two additional project interests in Botswana and Tanzania and taken an option for due diligence over an additional cobalt license in the DRC;
- In Botswana the Company has an 18.26% stake in Kalahari Key Mineral Exploration Pty Ltd (“KKME”), which owns outright a single project, the Molopo Farms Complex (“MFC”) nickel-copper-PGM project, in South West Botswana (POW can by 31.12.19 elect to earn-in to a 40% direct MFC project interest by spending US$500,000 on the project by 31.12.20 – upon earn-in POW will hold a 50.96% effective economic interest in the MFC Project);
- The KKME team in Botswana have completed the helicopter airborne electromagnetic work defining 17 sub-surface targets and very recently the ground geophysics over the top 10 targets, with interpretation and drill targets to follow shortly;
- In Tanzania POW has acquired a 25% holding in the Haneti nickel project held in joint venture with Katoro Gold plc (LON:KAT) with a right to increase to 35% through a payment of £25,000 by 15 May 2020;
- A drill programme is to be undertaken over the two principal drill targets at Haneti at the heart of what is considered to be an 80 km potential mineralised strike, and supplementing this, work has identified the presence of lithium pegmatites;
Management and Administration:
- The Company has conducted a management and technical advisory review and as a result of this review Paul Johnson, previously Executive Director, has become Chief Executive Officer with immediate effect;
- In addition, recognising the success of exploration activities to date and new acquisitions, the Company recognises the need to add additional technical capabilities at senior management and consultancy level;
- Otherwise we are generally pleased with the support provided by our advisors and consultants to the Company and have established a cost effective and disciplined system of business administration.
Finance and Working Capital:
- Following the restructuring and refinancing the initial financial focus of the Company was the completion of Audited Results for the year ended 30 September 2018 and which were successfully finalised and released on 29 March 2019;
- In addition, Interim Results for the half year ended 31 March 2019 were completed and released on 11 June 2019;
- Following completion of the refinancing in February 2019 the Company paid all material creditor balances through a cash or share settlement;
- The Company has no material debt and a secure working capital position.
Marketing and Communications:
- The Company implemented a name change from African Battery Metals plc to Power Metal Resources plc with effect from 21 June 2019;
- A complete overhaul of the Company’s website has now been undertaken and a new corporate presentation prepared for the website;
- Various initiatives have been developed and more will be undertaken to increase awareness of the Company’s value proposition.
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.
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