Company has Completed US$500,000 Earn-in to 40% Direct Project Interest
Power Metal Resources PLC (LON:POW) the AIM listed metals exploration and development company is pleased to announce that the Company has now completed the earn-in to a 40% direct project interest in the Kalahari Key Mineral Exploration Pty Ltd (“Kalahari Key” or “KKME”) Molopo Farms Complex Project (the “Project” or “MFC Project”).
Paul Johnson, Chief Executive Officer of Power Metal Resources, commented:
“In a journey that began with our original agreement with Kalahari Key in May 2019, the MFC Project has moved forward dramatically.
On 8 April 2021 we announced significant nickel intersections from diamond drill programme assays and we currently await receipt and interpretation of further assay results, mineralogical testing outcomes and an array of further data from additional geophysical interpretations.
We are seeking a World Class nickel discovery and the findings so far have been extremely positive. It is therefore with some excitement that we announce completion of our US$500,000 earn-in.
Work continues at pace locally in Botswana and in the testing of samples in South Africa. In this regard I look forward to providing further updates to the market.”
Earn-in Background Information
The MFC Project is targeting prospective magmatic intrusion-hosted massive nickel sulphide and platinum-group element (“PGE”) mineralisation in Botswana.
Pursuant to an agreement announced by the Company on 13 May 2019, Power Metal had the right to earn-in to a 40% direct project interest in the MFC Project by expending US$500,000 on exploration expenditure, notably drilling of key targets at the Project.
Cash payments against this earn-in commenced in October 2020 and the Company can now confirm that it has fully satisfied the US$500,000 expenditure commitment and written confirmation of this has been received from Kalahari Key.
As a result, Power Metal has secured a 40% direct interest in the MFC Project. In addition, the Company holds 18% of the issued share capital of Kalahari Key. Taken together the combined effective economic interest of Power Metal in the MFC Project is 50.8%.
(Note: previously Power Metal held an 18.26% equity interest in Kalahari Key. This percentage has been reduced to 18% following the exercise of 333 share options held by a Kalahari Key director at a total exercise cost of US$19,880. Power Metal has continued to hold 3,542 Kalahari Key shares throughout. There are 1,225 outstanding Kalahari Key options held by Kalahari Key current/former senior management team members representing potential further dilution of a maximum 4.76% and with a total exercise cost of US$73,500).
Appropriate steps are now being taken to restructure the ownership of the MFC Project and holding company Kalahari Key to reflect the above.
Power Metal also agreed to participate in a rights issue for Kalahari Key, the settlement of which is anticipated shortly and will increase Power Metal’s interest in Kalahari Key to 5,313 shares or 21.7% of issued share capital, as fully diluted by the rights issue. This will increase the Company’s effective economic interest in the MFC Project to 53.02%.
Latest Exploration Information
Latest exploration results from the MFC Project including assays from diamond drilling displaying significant nickel intersections were published on 8 April 2021 and may be viewed through the following link:
22 April 2021