Power Metal Resources plc (LON:POW), the AIM listed metals exploration and development company, provides a business update to shareholders.
Personal Comments from Paul Johnson, Chief Executive Officer, of POW:
“Recent weeks have demonstrated the vulnerabilities we face today, in a manner that most of us have never experienced before.
In times of challenge as we have now it is imperative that public companies such as POW keep shareholders informed and maintain confidence in the potential of our company.
In my role as CEO of Power Metal Resources plc I have a duty to protect the interests of our shareholders, but with a sensitivity to the risks that a fully operational exploration company can bring.
Therefore, we have carefully considered our activities from a dual perspective, namely, to ensure we conduct our business diligently, and that we safeguard our existing business interests whilst remaining open to new opportunities that the currently challenging circumstances bring.
Compared to many of our peers POW has, in my view, an advantageous financial position, reflecting our underlying working capital and the flexibility with which we can deploy that working capital. This is important, enabling us to withstand the type of shock the markets have experienced recently, whilst still, selectively and carefully, advancing our core business interests and remaining open to new opportunities.
The work undertaken in the last year has built a strategically significant business portfolio which, being focused on elephant scale discovery potential, has the ability to deliver a resounding return for shareholders, notwithstanding wider market conditions.
That said we remain open to further opportunities which, perhaps sadly given the circumstances, are increasingly available to us during this acute pull back phase in global markets.
However, I want our shareholders to know that no matter what, the Power Metal Resources team are working to continue to protect your interests and build our business.
Over the coming days and weeks we will seek to release more detailed updates across our activities.
On a personal note I would like to thank shareholders who support the Company. When you invest your money into POW we have a great responsibility to protect your interests and seek a good return on your investment. I make it my business to ensure that all our team understand that, and rest assured that will remain the case whilst I am CEO.”
POW holds an 18.26% stake in Kalahari Key Mineral Exploration (Pty) Limited (“KKME”) which holds 100% of the Molopo Farms Complex project (the “MFC Project”) in Botswana.
POW also has the right to earn into a 40% direct interest in the MFC Project which is prospective for nickel-PGM mineralisation, by spending US$500,000 in 2020 on drilling of key targets. The money to undertake this drilling has already been raised and sits in POW’s working capital.
A further detailed update will be provided to the market shortly however the board of POW agree with the technical team at KKME, that the MFC Project presents an exciting opportunity to discover a significant nickel-PGM deposit.
The principal next step is approval of the Environmental Management Plan (“EMP) which has been submitted to the authorities locally for the MFC Project and which, on approval, will allow drill contractors to be selected and drilling to commence.
POW, with KKME, are assessing the next steps carefully whilst awaiting EMP approval and will update the market in this regard at the earliest opportunity.
Work undertaken by POW’s technical team in the DRC discovered a 6.8km copper anomaly in 2019 and as previously announced we launched an infill pitting programme to further enhance our knowledge of the copper, and cobalt, mineralisation at Kisinka.
The infill pitting programme is underway and a further update to the market will be provided shortly in this regard. We are monitoring operating conditions carefully to ensure the programme proceeds safely.
The aim of this programme is to validate and enhance earlier results which, if successful, will add to the weight of evidence for a significant copper, and potentially cobalt, deposit within the boundaries of the Kisinka Project.
Reflecting the exploration success to date, and the prospectivity identified, some corporate restructuring of the holding company is being undertaken further details of which will be provided to the market when completed.
POW currently holds 10 million shares in Katoro Gold plc (LON:KAT) and 10 million warrants exercisable at 1.25p per share (2,500,000 warrants expiring on 15 March 2022 and 7,500,000 warrants expiring on 15 May 2022).
POW also currently has a direct interest in 25% of the Haneti Project in Tanzania, with Katoro Gold holding the balance. POW can increase its interest to 35% by paying £25,000 cash to Katoro by 15 May 2020.
The Haneti Project is a polymetallic opportunity, prospective for gold, nickel, platinum group metals (“PGMs”), lithium and rare earth elements. Haneti has multiple exploration opportunities, the most advanced of which are the drill ready nickel-PGM targets at Mihanza Hill and Mwaka hill targeting chonolith nickel sulphide mineralisation.
Haneti has drawn interest from third parties seeking potential large scale nickel-PGM opportunities and we await feedback on related discussions.
It is notable that Katoro has also recently embarked upon a substantial near-term gold tailings production opportunity. The POW board consider this to be a remarkable new opportunity and congratulate the Katoro team for what is a commercially exciting new development.
25 March 2020