REG - Power Metal - First Development Resources – Selta Project Update

Power Metal ResourcesAnnouncement

20/05/2022 13:30

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RNS Number : 3062M  Power Metal Resources PLC  20 May 2022

20 May 2022

Power Metal Resources PLC

("Power Metal" or the "Company")

First Development Resources - Selta Project Update

 

Power Metal Resources plc (LON:POW), the London listed exploration company
seeking large-scale metal discoveries across its global project portfolio,
provides an update to shareholders in respect of the Selta Project ("Selta" or
the "Project").

Selta is 100% owned by Power Metal's 82.78% owned subsidiary First Development
Resources Limited ("FDR").

FDR is planning to list on the London capital markets in Q3 2022 (the "IPO")
and is focussed on district-scale exploration opportunities in Australia.

Paul Johnson Chief Executive Officer of Power Metal Resources
plc commented:

"Some 70km south-east of the Selta Project lies Nolans Bore, a significant
rare-earth element deposit held by ASX listed Arafura Resources Limited. We
secured the Selta Project with a view, in part, to investigating the
rare-earth element potential of Selta and its considerable 1,575km(2) licence
footprint.

It's too early to be definitive, though our findings on rare-earth element
prospectivity have been encouraging, and today have moved forward
considerably.

This is exciting for us as we make plans to demonstrate the potential of Selta
through disciplined and intensive exploration. The work we outline below
demonstrates the importance of extremely valuable desktop work where, for very
little cost, creative explorers can often access the findings of work
undertaken and funded by others historically."

Tristan Pottas Chief Executive Officer of First Development Resources
Ltd commented:

"Our work has identified compositionally similar granites over both the
Nolan's Bore deposit and the Selta Project. The stream sediment sample results
we have outlined below, and which cover the southern target in the map
provided, are extremely high which could mean the granites over Selta are also
enriched in rare-earth elements.

We are continuing to build our information database, and to date the
in-country team and our technical advisors in the UK have been doing some
incredible work that we believe has added considerable value to the Selta
Project."

BACKGROUND

Prospectivity for Uranium and Rare Earth Elements Confirmed Previously

The recently completed in-depth review (the "Review") of all publicly
available geological, geophysical and geochemical data for the Selta Project
in Australia's Northern Territory originally identified four uranium ("U") and
three rare-earth element ("REE") targets within the Selta Project area, as
well as the potential for lithium, gold and base-metal mineralisation.

The 16 March 2022 announcement in respect of this in-depth review may be
viewed below through the following link:

https://www.londonstockexchange.com/news-article/POW/selta-project-multiple-target-areas-identified/15371081
(https://www.londonstockexchange.com/news-article/POW/selta-project-multiple-target-areas-identified/15371081)

New and Refined Prospectivity for REE's Through Follow-on Work

Further desktop work has since been completed and an additional data set has
been identified which has enabled FDR to: 1) delineate an additional REE
target; 2) materially increase the prospectivity of the original three REE
target areas; and 3) further refine the location and shape of the original
three REE target areas at Selta.

The targets delineated are shown in the map linked below on the Company's
website:

 https://www.powermetalresources.com/fdr-crossland-data/
(https://www.powermetalresources.com/fdr-crossland-data/)

NEW HIGHLIGHTS

·    Historical stream sediment sample results within the Selta Project
area collected by Crossland Uranium(1) between 2014-2016 has enabled FDR's
geology team to delineate an additional REE target area at Selta - resulting
in four prime target areas for REEs that materially boost the overall
exploration potential.

 

·    The Crossland data set includes several high-magnitude REE-in-steam
results from all target areas, which has not only increased the overall
prospectivity of the four targets but allowed FDR to further refine the shape
and location of said targets.

 

·    The Crossland data set combined with the previously completed Selta
desktop review will enable a focussed approach to the next phase of
exploration which will comprise a site visit to reconcile observations with
historical data and identify preliminary targets for further investigation.

 

CROSSLAND URANIUM STREAM SEDIMENT DATA

Overall, the FDR geology team analysed two separate datasets of Crossland
stream sediment samples which included 103 stream sediment samples in total
within the Selta Project which were analysed for 15 (out of 17) REEs
including:  cerium (Ce), dysprosium (Dy), erbium (Er), europium (EU),
gadolinium (Gd), holmium (Ho), lanthanum (La), lutetium (Lu), neodymium (Nd),
praseodymium (Pr), samarium (Sm). terbium (Tb), thulium (Tm), yttrium (Y) and
ytterbium (Yb). Sample analysis was completed by Genalysis Laboratory
Services. The total of these 15 rare-earth element assays combined is referred
to as the Total Rare-Earth Element ("TREE"). The results are summarised below:

Twelve samples were found to be highly anomalous (> 3800 ppm TREE -
>90(th) percentile) for TREEs, of which eight samples were found to be
extremely anomalous for TREEs (>7,000 ppm). Of the twelve highly anomalous
samples, seven were also found to be anomalous for neodymium (>2217 ppm Nd)
and  praseodymium (>557 ppm Pr). These results illustrate significant
local elevations of critical REEs.

Other elements of note that returned anomalous results include:

·    5 samples had anomalous Zirconium >7,440 ppm with a peak result in
one sample of 20,892 ppm .

·    8 samples had anomalous Thorium >1,215 ppm with a peak result in
one sample of 3,213 ppm.

·    9 samples had anomalous Uranium >118 ppm with a peak result in one
sample of 136 ppm.

·    6 samples had anomalous Tungsten >62 ppm with a peak result in one
sample of 189 ppm.

·    4 samples had anomalous Phosphorus (> 1,100 ppm), up to 6,500 ppm
in one sample.

Note: Lithium was not assayed for in the stream sediment samples.

These results, combined with the high TREE values listed above - including one
sample of up to 16,743 ppm (1.6% TREE) - are suggestive of potentially strong
bedrock REE mineralisation upstream of the sample sites.

SELTA PROJECT- PROXIMAL TO WORLD-CLASS REE DEPOSIT

The Selta Project borders Prodigy Gold NL (ASX:PRX), IGO Ltd (ASX: IGO) and
Canadian listed Megawatt Lithium and Battery Metals Corp (CSE: MEGA); and is
approximately 70 km northwest of Arafura Resources Limited (ASX: ARU)
("Arafura Resources") high-grade, world-class Nolans Bore REE deposit.

The Nolans Bore REE-phosphate-uranium-thorium deposit is one of the largest of
its kind globally with a JORC (2012) compliant Mineral Resource of 56
million tonnes at an average grade of 2.6% total rare-earth oxides and 11%
phosphate (P(2)O(5)).(2)

Commercial production at the Nolans Bore REE deposit is targeted for late
2024, with the Feasibility Study considering a 4,440 tonne per annum Nd-Pr
oxide producing open pit mining operation with a 38 year mine-life and an
NPV8% of US$1.011B.(3)

Arafura Resources was recently awarded a grant for up to AU$30 million to
contribute to the construction of their rare earths separation facility which
is expected to cost in the region of AU$90.8 million. The grant was allocated
from the Federal Government's AU$1.3 billion Modern Manufacturing Initiative
which has been established with the aim of developing Australia as a regional
resources technology and critical minerals processing hub within 10 years.(4)

Arafura Resources recently announced it has signed a non-binding memorandum of
understanding (MoU) with one of the world's most progressive automotive
groups, South-Korean based Hyundai Motor Company. The MoU provides a framework
for the parties to negotiate a binding offtake agreement for the supply of up
to approximately 1,000 - 1,500 tonnes per annum of Nd-Pr Oxide from the Nolans
Project to commence in 2025 for a seven year term on a cost, insurance and
freight basis.(5)

The underlying geology within the Selta Project is interpreted by FDR's
geological team to be comparable to the Nolans Bore deposit. Notably, REE and
uranium mineralisation at Nolan's Bore is hosted within G6 granites which are
postulated to be compositionally similar to the G5 granite prevalent across
the Selta Project. Furthermore, preliminary statistical analysis was carried
out on the Crossland stream samples, and a strong statistical correlation was
noted between REEs, uranium, thorium and phosphorous within the dataset. This
relationship suggests pegmatite hosted REE mineralisation may be the source of
the stream sediment anomalies.

FDR EXPLORATION INTERESTS

FDR Australia holds the following exploration licence interests:

Wallal Project (Wallal Main-E45/5816 - 390km(2) - granted), (Wallal West
1-E45/5853 96km(2) - granted) and (Wallal West 2 - E45/5880 -
86km(2) - granted).

A comprehensive geophysical review has identified three magnetic bullseye
anomalies located under Phanerozoic sedimentary cover which are interpreted to
have possible geological similarities major Au-Cu deposits within the Paterson
Province including Winu (Rio Tinto) and Havieron (Newcrest Mining-Greatland
Gold joint venture).

Braeside West Project (E45/5854 - 137km(2) - one granted licence)

In-depth desktop analysis of historic exploration data is currently underway
on the Braeside West Project. A recent base-metal discovery by neighbouring
company Rumble Resources Ltd (ASX:RTR) has enhanced the overall prospectively
within the Braeside West Project area as it is hosted within a similar
geological environment to that of Rumble Resources discovery.

Ripon Hills Project (E45/5088 - 42km(2) - one granted licence).

The Ripon Hills Project is prospective for base-metal and gold mineralisation
associated with deep-seated north-south oriented fault structures which run
through the Ripon Hills Project area. In-depth desktop analysis of historic
exploration data is currently underway over the project.

Selta Project (EL 32737, EL 32738, EL 32755 - 1,575km(2)-three granted
licences)

The Selta Project is located in an area considered to be highly-prospective
for uranium and rare earth element mineralisation. FDR recently completed an
in-depth review of all geological, geophysical and geochemical data which also
identified the potential for lithium, gold and base-metal mineralisation as
well as the possibility of tin-tantalum-tungsten rich pegmatites.

The data disclosed in this announcement is derived from historical reports and
historical sampling results. FDR has not undertaken any independent
investigation of the sampling nor has it independently analysed the results of
the historical exploration work in order to verify the results. FDR considers
these historical sample results relevant as it will use this data as a guide
to plan future exploration programmes. FRD's future exploration work will
include verification of the data through further analysis.

REFERENCES

1)    Crossland Nickel Pty Ltd - Report Number CR2016-0105. Available at:
https://geoscience.nt.gov.au/gemis/ntgsjspui/simple-search?location=1%2F3&query=%22CR2016-0105%22&rpp=10&sort_by=score&order=desc
(https://geoscience.nt.gov.au/gemis/ntgsjspui/simple-search?location=1%2F3&query=%22CR2016-0105%22&rpp=10&sort_by=score&order=desc)

2)    Mineral Resources for the Nolans Bore Deposit as of June 2017 using a
1% TREO cut-off grade. Available at: Arafura - Nolans (arultd.com)
(https://www.arultd.com/projects/nolans.html)

3)    Arafura Resources Limited 2015 & 2017 Annual Reports. Available
at:

https://www.arultd.com/investor/asx-announcements-2021/asx-archive.html
(https://www.arultd.com/investor/asx-announcements-2021/asx-archive.html)

4)    Arafura Resources Awarded AU$30M in new initiative funding. Available
at: Arafura Resources Awarded A$30M In New Initiative Funding (theassay.com)
(https://www.theassay.com/news/arafura-resources-awarded-a30m-in-new-initiative-funding/#:~:text=Arafura%20Resources%20Limited%20%28ASX%3AARU%29%20has%20been%20awarded%20grant,at%20its%20Nolans%20Project%20in%20Australia%E2%80%99s%20Northern%20Territory.)

5)    Arafura Resources Limited ASX Announcement available at: Arafura and
Hyundai motor Company sign non-binding MOU for neodymium and praseodymium
offtake (asx.com.au)
(https://www.asx.com.au/asxpdf/20220519/pdf/45942dsk7h1kqz.pdf)

GLOSSARY

 

Stream Sediment Sample - a sample collected from concentrated material within
the bed of a stream, a widely used technique in early stage exploration.

Total Rare Earth Element (TREE) - The abundance of the fifteen lanthanides
(Lanthanum, Cerium, Praseodymium, Neodymium, Promethium, Samarium, Europium,
Gadolinium, Terbium, Dysprosium, Holmium, Erbium, Thulium, Ytterbium,
Lutetium) plus Scandium and Yttrium. These elements are vital components for
modern electronical and battery technology.

IPO AND LISTING PROCESS

FDR is seeking a listing on the London capital markets and is working with
advisors in this regard and is targeting a listing on the London capital
markets in Q3 2022.

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.

 

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.

 

Power Metal Exploration Programmes Underway/Results Awaited

Power Metal has exploration programmes completed or underway, with results
awaited, as outlined below:

 

 Project                Location   POW %            Work Completed or Underway                                                    Results Awaited

 Alamo Gold Project     USA        Earn-in to 75%   Excavation of multiple test pits and mapping & sampling.                      Field and assay results from on-site work programme.
 Athabasca Uranium      Canada     100%             Data compilation across uranium properties                                    Interpretation results from all Properties complete. Next steps upcoming.
 Authier North Lithium  Canada     Earn-in to 100%  Soil & rock sampling completed                                                Technical Review of exploration results & define next exploration steps.
 Ditau Project          Botswana   50%              Drill programme focused on key targets notably drilling of potential          Field updates and receipt & review of laboratory assay results.
                                                    carbonatites and targeting rare-earth elements.
 Kalahari Copper Belt   Botswana   50%              Exploration programme underway across the South Ghanzi Project and further    Field programme findings and defined drill targets for near term drilling.
                                                    exploration at the more recently acquired South Ghanzi Extension and Mamuno
                                                    licence areas
 Molopo Farms           Botswana   53%              Review of recent exploration findings.                                        Determine next exploration steps and action plan.
 Haneti Project         Tanzania   35%              Diamond drill programme completed                                             Receipt & review of laboratory assay results.
 Victoria Goldfields    Australia  49.9%            Diamond drill programme underway                                              Field updates and receipt & review of laboratory assay results.

 Paterson Projects      Australia  82.78%           Wallal passive seismic and 2D seismic processing work programme completed.    Findings from multiple work programmes including final approvals and

                                                                             preparations for planned deep diamond drilling.
                                                    Review of historical data and target generation for Ripon Hills &
                                                    Braeside West projects.

 Selta Project          Australia  82.78%           Field reconnaissance work complete, which included mapping and sampling.      Finalising data review from field programmes.

 

 

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