Canadian Silver Project – Drilling Commences

Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to announce drilling has commenced at the Silver Peak silver project (the “Silver Peak Project” or the “Project”) in British Columbia, Canada.

CHIEF EXECUTIVE OFFICER’S STATEMENT

Paul Johnson Chief Executive Officer of Power Metal Resources plc commented
“I am extremely pleased to announce the commencement of drilling at the Silver Peak project enabling us to secure sample core for laboratory assay testing and complimenting the work undertaken to date including the summer channel sampling which produced bonanza silver grades and significant copper and lead grades.

As you will see below the original drilling plan had to be altered, and we have implemented a different approach using equipment appropriate to the new circumstances. I thank our partners for their quick thinking adaptability that has enabled a revised drill programme to be implemented.

Given the significant results from the sampling programme we conducted recently we are obviously eager to see the assay results from this drilling programme.”

HIGHLIGHTS:

  • On 22 October 2020 Power Metal announced the signing of the drilling contract for an initial 500m confirmatory diamond core drill programme to test the Victoria Vein at the Silver Peak Project. The Project includes the Eureka-Victoria Silver Mine, the first Crown-granted mineral property in British Columbia.

    On 30 October 2020 Power Metal announced that the drilling contractor had mobilised the drilling rig, bulldozer and ancillary equipment from northern British Columbia to the local town of Hope where the Silver Peak Project is based and then the planned movement of the drilling rig and support equipment from Hope up the valley, on the upgraded access, to the project and the first drilling pad.
  • The mobilisation was attempted but the area had experienced significant poor weather recently which caused a degradation in conditions at the project and limited access to the property. Some of the impacts were dealt with, including the removal of fallen trees, however given the size of the rig and supporting equipment and the conditions encountered it was not considered safe to proceed with the original plan of moving the larger rig up onto the drilling pad.
  • Rather than not proceeding and delaying the drill programme entirely Power Metal’s local partners secured smaller man-portable drill equipment and this, together with associated support equipment has been installed at the Project and the team have now commenced drilling.
  • The portable core drill being utilised produces a 48mm core (of similar size to that originally intended from the larger rig) and will be used to test multiple targets initially focused on the top of the lower Victoria portal.
  • The local team are aiming to drill test at least twenty vein intersections in a 6 to 8-day programme dependent particularly on weather conditions in the Project area.
  • Hole depth is expected to be circa 6m (20 feet) as the smaller drill enables collaring to be undertaken close to the vein.
  • As such, the total drill programme is now aiming to complete approximately 120m of drilling rather that the proposed 500m of diamond core drilling as announced on 22 October 2020, with a significant consequent reduction in programme cost.
  • If successfully completed as outlined the drill programme will provide core from more locations across the property than the original programme would have provided.
  • The grade of each core sample will be tested using a handheld X-ray Fluorescence (“XRF”) unit to get an estimate of silver grades prior to assay testing at an accredited local laboratory.

FURTHER INFORMATION

Background

On 14 September 2020 the Company announced the exercise of an option agreement announced 17 August 2020 (the “Option Agreement”) in respect of the Silver Peak Project, gaining the right to earn-in to a 30% interest in the Project.

Prior to option exercise the Company undertook a due diligence exploration programme including sampling at the Project to gather further information and to assist the Company in its assessment of project prospectivity and potential.

The assay results from the due diligence channel sampling were reported on the 22 September 2020 and are set out in Table 1 below:

Table 1: Summary of assay results for samples taken during Power Metal Due Diligence sampling on Victoria Vein, Silver Peak Project

ALS Global Analytical Method

Ag-GRA22

Ag-CON01

Cu-OG46

Pb-OG46

Sample ID

Channel Sample Length

(m)

Ag

(ppm)

Ag

(ppm)#

Cu

(%)*

Pb

(%)*

SP20-001

0.50

>10,000

10,718

2.14

2.99

SP20-002

0.50

6,010

 

1.71

2.87

SP20-003

0.50

7,530

 

1.57

2.07

SP20-004

0.60

5,540

 

1.38

 

SP20-005

0.70

7,880

 

1.94

3.16

SP20-006

0.50

>10,000

14,937

3.05

11.95

SP20-007

0.80

5,330

 

1.26

 

SP20-008

0.55

1,595

 

1.78

 

SP20-009

0.45

4,110

 

-

 

SP20-010

0.65

1,755

 

1.71

 

SP20-011

N/A Grab sample

660

 

-

 

Project Overview

The Silver Peak Project consists of a portfolio of mineral claims (the “claims”) over a system of high grade, intrusion related, polymetallic Ag-Pb-Zn-Cu veins, part of the historical Eureka-Victoria Silver Mine, at Silver Peak in southern British Columbia, Canada.

Earlier Due Diligence Exploration Programme

The due diligence work programme previously conducted by Power Metal included various elements including channel sampling at close intervals perpendicular to the existing known high-grade veins and grab samples from a main target area between the lower elevations and the Victoria Adit.

The work also included enhancement of road accessibility to the exploration area, and the collation of detailed photographic and video evidence of the project area for cross referencing to existing project technical information.

A portable X-ray fluorescence analyser (“pXRF”) was utilised to provide in-field, geochemical analyses, in conjunction with confirmatory laboratory assay testing where appropriate.

The due diligence work programme cost totalled C$25,000 (£14,512) and the amount expended will be deducted from Power Metal’s 12 month Project exploration spend commitment of C$250,000.

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.

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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10 November 2020

 
 
 

Power Metal Resources plc
201 Temple Chambers
3-7 Temple Avenue
London EC4Y 0DT
United Kingdom

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