REG - Power Metal - Disposal of E-12 Uranium Property - Canada

Power Metal ResourcesAnnouncement

04/11/2022 14:30

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RNS Number : 4200F  Power Metal Resources PLC  04 November 2022

4 November 2022

Power Metal Resources PLC

("Power Metal" or the "Company")

Disposal of E-12 Uranium Property - Saskatchewan, Canada

Power Metal Resources plc (LON:POW), the London listed exploration company
seeking large-scale metal discoveries across its global project portfolio
announces the conditional disposal of its 100% owned E-12 Uranium Property
("E-12" or the "Property").

HIGHLIGHTS:

E-12 Property

-  E-12 is a 13km(2) Property located immediately south of the prolific
Athabasca Basin in Northern Saskatchewan, Canada.

-     E-12 is one of twelve* uranium properties held by 102134984
Saskatchewan Ltd ("Power Sask"), a wholly owned subsidiary of Power Metal
Resources Canada Inc. ("POW Canada") which is a wholly owned subsidiary of
Power Metal.

Acquirer - Teathers Financial

-    Teathers Financial is currently in the advance stages of preparing for
a change of business to become a uranium exploration focused company which
plans undertake an initial public offering on the London capital markets -
targeted for Q4 2022 (the "Listing"). Teathers is to be renamed Uranium Energy
Exploration Plc with the ticker symbol 'UEE'.

-  On 8 August 2022 Power Metal announced the conditional disposal of its
interest in 100% owned Reitenbach uranium property to Teathers Financial.

The Transaction

-     A Property Purchase Agreement (the "Agreement") has been signed for
Teathers Financial Plc ("Teathers Financial" or "Teathers") to  conditionally
acquire 100% ownership of the Property, subject to completion of the Listing
by 31 December 2022.

-   The consideration payable is £250,000 in Teathers Financial new ordinary
shares of 0.1p ("Ordinary Shares") at an issue price of 1.24114 pence per
Ordinary Share and the retention of a 2% Net Smelter Return royalty over the
Property (see detailed terms below).

-      Following completion of the E-12 disposal and the disposal of
Reitenbach uranium property (announced on 8 August 2022), Power Metal will
hold 118,842,853 shares in Teathers Financial or 73.75% of expected issued
share capital prior to its planned IPO financing, expected to be undertaken
later this current quarter.

-     *The twelve uranium properties include Reitenbach uranium property the
conditional disposal of which was announced on 8 August 2022 and the E-12
property, the conditional disposal of which is announced today.

Paul Johnson, Chief Executive Officer of Power Metal Resources PLC commented:

"Upon its planned listing, Uranium Energy Exploration Plc will be the only
Athabasca Basin focused junior exploration company in the London capital
markets and intends to explore and advance the Reitenbach and E-12 uranium
properties at pace.

Exploration work done so far across both properties has demonstrated extensive
uranium prospectivity and the design of planned work programmes is well
underway.

Final preparations for listing of Uranium Energy Exploration Plc are now
underway and the aim is for the listing to occur by the end of this year."

TRANSACTION TERMS

For the sale of 100% of Power Canada's interest in the E-12 Property, one of
twelve* uranium focused properties held by Power Canada within and surrounding
the Athabasca Basin, Saskatchewan, Canada, the following consideration is
payable:

·    The issue to Power Sask of 20,142,853 Teathers Financial new ordinary
shares ("Ordinary Shares") at a price of 1.24114p per share for a total value
of £250,000.

·    Power Sask will retain a 2% Net Smelter Return ("NSR") royalty the
E-12 Property, 1% which can be bought back by Teathers Financial at any time
prior to production for £750,000.

·    Following completion of the E-12 disposal and the disposal of
Reitenbach property announced on 8 August 2022, Power Metal will hold
118,842,853 shares in Teathers Financial or 73.75% of current issued share
capital prior to its planned IPO financing, expected to be undertaken later
this current quarter.

·    The NSR's on the Reitenbach and E-12 properties will be sold and
transferred to Power Metal or its wholly owned nominee at a total value of
CAD$50,000 on completion of the transaction.

The transaction is conditional on:

-    The approval of Teathers Financial shareholders to the transaction
and to a Rule 9 Whitewash arrangement, enabling Power Metal to acquire its
interest without a requirement to make an offer for the entire company.

-     The London Listing of Teathers Financial.

-   Note: the Reitenbach disposal was conditional upon Teathers Financial
securing a £125,000 pre-IPO financing to cover transactional costs in
relation to the planned listing.  This condition has been satisfied.

TEATHERS FINANCIAL

Recent IPO and Exploration Workstreams

Since the conditional acquisition of the Reitenbach uranium property on 8
August 2022, Teathers has finalised multiple work streams relating to their
planned listing and made multiple technical advancements of the Reitenbach
property which are covered within the link below:

https://www.londonstockexchange.com/news-article/POW/reitenbach-uranium-disposal-progress-update/15620258
(https://www.londonstockexchange.com/news-article/POW/reitenbach-uranium-disposal-progress-update/15620258)

This includes successful completion of a £125,000 pre-IPO financing and
progress in respect of ongoing exploration including:

§ The identification of multiple significant uranium prospective anomalies
across the Reitenbach property including a 'New Lake Geochem Zone' which is
highlighted by extremely high-tenor U-in-lake sediment results.

 

§ Additional staking of 1,333 hectares (13.33Km(2)) completed to cover the
new prospective zone, increasing the size of the Reitenbach property.

Proposed Listing Board

-     Mr Sandy Barblett has recently joined Teathers as a Non-executive
Director. Sandy has over 25 years of senior management experience across
numerous sectors. Mr Barblett is an experienced director and adviser, for both
private and listed companies, in relation to raising private equity and
general fundraising, admission to public markets, strategy and management
selection. He is a founder and advisor to the Eastern Heavy Minerals project
 which is the sole project for AIM quoted Capital Metals PLC, currently
Chairman of East Star Resources PLC and IamFire PLC.  Mr Barblett has a
Bachelor of Business from Curtin University of Technology in Perth, Australia,
and a Bachelor or Laws from the University of Queensland.

-     Upon listing of Teathers, the board of directors is expected to
consist of Sean Wade (CEO and Executive Director), Sandy Barblett
(Non-executive Director) and Mario Visconti (Non-executive Director).

Uranium Sector - Market Conditions

-     The level of interest surrounding various uranium focused investment
opportunities remains robust, which is further bolstered by the return of an
increasing uranium spot price.

-     Transactional deal flow also remains robust with considerable
quantum associated with a number of recent Athabasca Basin focused property
deals (e.g. Skyharbour Resources Ltd (TSXv:SYH) earn-in option agreement for
the disposal of up to a 75% interest in their South Falcon East property -
Announced on 20 October 2022 https://skyharbourltd.com/news-media/news/
(https://skyharbourltd.com/news-media/news/) ).

-     Multiple successful ASX-listed IPO's have been undertaken, some of
which are focused on the prolific Athabasca Basin (e.g. Basin Energy Ltd
(ASX:BSN) recently completed a $9M AUD oversubscribed IPO financing
https://www2.asx.com.au/markets/company/bsn
(https://www2.asx.com.au/markets/company/bsn) )

-     Assuming completion of the Reitenbach and E-12 property
acquisitions, and prior to shares issued in respect of an IPO financing,
Teathers will have a £2million valuation, placing it at the very low end of
its peer group in terms of comparable valuations for Athabasca Basin focused
uranium explorers.

-     Power Metal expects to hold an interest of circa 50-55% in Teathers
upon listing, with the actual holding dependent upon the IPO financing quantum
and pricing.

NEXT STEPS

·    Exploration programmes are currently being planned across the E-12
and Reitenbach uranium properties, which will be carried out by Teathers
Financial in 2023, following their planned listing on the London capital
markets.

·    This exploration work is expected to include geophysical surveys
across the Reitenbach property in Q1 2023, to delineate targets for follow on
inaugural drilling.

·    Power Metal, with its in house technical group with expertise in
uranium exploration, have agreed to provide Teathers with ongoing technical
consulting services relating to planned and future exploration programmes on
both properties.

·    Reflecting the growing interest shown from third parties,
comprehensive datarooms and factsheets have been compiled over all of the
Company's Saskatchewan based uranium assets.

THE E-12 PROPERTY

A detailed breakdown of all publicly available technical information over the
E-12 Uranium Property was released to the market on 24 March 2022 and can be
found at the link below:

https://www.londonstockexchange.com/news-article/POW/uranium-portfolio-update-athabasca-basin-canada/15381520
(https://www.londonstockexchange.com/news-article/POW/uranium-portfolio-update-athabasca-basin-canada/15381520)

The Power Metal book value of the E-12 Property is £5,797 and no losses have
been recorded in respect of the Property in the year ended 30 September 2022,
with all costs capitalised.

URANIUM PROPERTIES - HOLDING STRUCTURE

Power Metal has a 100%-owned subsidiary Power Metal Resources Canada
Inc ("Power Canada"), which acts as the holding Company for certain Canadian
project operations. Power Canada has a wholly owned subsidiary,
102134984 Saskatchewan Ltd, which is the holder of the Company's Athabasca
uranium portfolio outlined in Table 1.

Table 1: 102134984 Saskatchewan Ltd., Athabasca Basin Property Holdings

 

 Project                        Licence ID      Area        Area

                                                (Hectare)   (km(2))
 Clearwater Uranium Property    MC00015079      1,110       11.1
                                MC00015083      563         5.63
                                MC00015082      3,191       31.91
                                MC00015151      760         7.6
                                MC00015646      761         7.61
                                MC00015658      1,541       15.41
 Tait Hill Uranium Property     MC00015078      1,576       15.76
                                MC00015081      968         9.68
                                MC00015153      1,530       15.3
                                MC00015152      1,886       18.86
                                MC00015647      725         7.25
                                MC00015648      1,129       11.29
                                MC00016158      3,242       32.42
 Thibaut Lake Uranium Property  MC00015077      2,206       22.06
                                MC00015659      2,195       21.95
 Soaring Bay Uranium Property   MC00015080      1,255       12.55
                                MC00015155      3,375       33.75
                                MC00015874      748         7.48
                                MC00015875      2,529       25.29
 Cook Lake Uranium Property     MC00015212      984         9.84
 E-12 Uranium Property*         MC00015213      1,323       13.23
 Reitenbach Uranium Property**  MC00015214      2,135       21.35
                                MC00015474      1,235       12.35
                                MC00015655      4,570       45.7
                                MC00015656      5,322       53.22
                                MC00015657      886         8.86
                                MC00015824      528         5.28
                                MC00016155***   1,333       13.33
 Reindeer Lake                  MC00015522      3,336       33.36
 Porter Lake                    MC00015561      5,656       56.56
                                MC00015562      5,198       51.98
 Old Woman Rapids               MC00015563      4,851       48.51
                                MC00015564      5,063       50.63
                                MC00015565      3,044       30.44
 Durrant Lake                   AC00018000      5,866       58.66
 Badger Lake                    MC00016253      1,671       16.71
 Total Licence Holding Area                     84,291      842.91km(2)

*E-12 Property conditionally disposed to Teathers Financial PLC as announced
today.

**Reitenbach Property conditionally disposed to Teathers Financial PLC as
announced 8 August 2022.

***Newly staked ground as announced 8 September 2022

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic
law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.

 

For further information please visit https://www.powermetalresources.com/
(https://www.powermetalresources.com/)  or contact:

 Power Metal Resources plc
 Paul Johnson (Chief Executive Officer)                                          +44 (0) 7766 465 617

 SP Angel Corporate Finance (Nomad and Joint Broker)
 Ewan Leggat/Charlie Bouverat                                                    +44 (0) 20 3470 0470

 SI Capital Limited (Joint Broker)
 Nick Emerson                                                                    +44 (0) 1483 413 500

 First Equity Limited (Joint Broker)
 David Cockbill/Jason Robertson                                                  +44 (0) 20 7330 1883

 

NOTES TO EDITORS

Power Metal Resources plc - Background

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration
company which finances and manages global resource projects and is seeking
large scale metal discoveries.

The Company has a principal focus on opportunities offering district scale
potential across a global portfolio including precious, base and strategic
metal exploration in North America, Africa and Australia.

Project interests range from early-stage greenfield exploration to later-stage
prospects currently subject to drill programmes.

Power Metal will develop projects internally or through strategic joint
ventures until a project becomes ready for disposal through outright sale or
separate listing on a recognised stock exchange thereby crystallising the
value generated from our internal exploration and development work.

Value generated through disposals will be deployed internally to drive the
Company's growth or may be returned to shareholders through share buy backs,
dividends or in-specie distributions of assets.

Exploration Work Overview

Power Metal has multiple internal exploration programmes completed or
underway, with results awaited.  The status for each of the Company's
priority exploration projects is outlined in the table below.

 Project            Location  Current    Work Completed or Underway                                                     Results Awaited

                              POW %

 Athabasca Uranium  Canada    100%       Ground exploration programme complete at 3 properties.  Preliminary planning   Assay results from samples collected during fieldwork.
                                         for work in Spring/Summer 2023 is ongoing.
 Molopo Farms       Botswana  87.71%(#)  T1-6 conductor target drilling underway, T1-14 first hole commencing shortly.  Drill programme updates and findings from further MLEM survey work.
                                         Further MLEM surveys planned over additional AEM targets identified.
 Tati Project       Botswana  100%       RC drilling and sampling of mine dumps complete.                               Review of mine dumps sampling and assay results from RC drill programme.

(#) subject to completion of acquisition announced 18.5.22 for which
regulatory approval confirmed 28.10.22

Exploration work programmes may also be underway within Power Metal investee
companies and planned IPO vehicles where Power Metal has a material interest,
the findings from which will be released on their respective websites, with
simultaneous updates through Power Metal regulatory announcements where
required.  These interests are summarised in the table below:

 Company                          Status/Operations                                                           Link
 First Class Metals PLC           Investment - POW 27.91%                                                     www.firstclassmetalsplc.com (http://www.firstclassmetalsplc.com)

                                  Exploration in the Schreiber-Hemlo region of Ontario, Canada
 First Development Resources PLC  Planned IPO - POW 62.12%                                                    www.firstdevelopmentresources.com (http://www.firstdevelopmentresources.com)

                                  Exploration in Western Australia and the Northern Territory of Australia
 Golden Metal Resources PLC       Planned IPO - POW 83.13%                                                    www.goldenmetalresources.com (http://www.goldenmetalresources.com)

                                  Exploration and development in Nevada, USA
 Kavango Resources PLC            Investment - POW 14.03% (subject to completion of Kanye Resources disposal  www.kavangoresources.com (http://www.kavangoresources.com)
                                  announced 8.7.22 and issue of Kavango shares e.g. financing announced

                                  24.10.22)

                                  Exploration in Botswana
 New Ballarat Gold PLC            Planned IPO - POW 49.9%                                                     A new website is currently in development which will be found at

                                                                           www.newballaratgoldcorp.com (http://www.newballaratgoldcorp.com) .
                                  Exploration in the Victoria Goldfields of Australia

                                                                                                              In the interim further information in respect of NBGC can be found at:

                                                                                                              https://www.powermetalresources.com/project/victoria-goldfields/
                                                                                                              (https://www.powermetalresources.com/project/victoria-goldfields/) .

 Uranium Energy Exploration PLC   Planned IPO - POW on listing estimated 40-55%                               www.uraniumenergyexploration.com (http://www.uraniumenergyexploration.com)

                                  Uranium exploration in the Athabasca region of Canada

 

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