REG - Power Metal - Kalahari Key – Acquisition & Drilling Update

Power Metal ResourcesAnnouncement

03/11/2022 16:15

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RNS Number : 2726F  Power Metal Resources PLC  03 November 2022

3 November 2022

Power Metal Resources PLC

("Power Metal" or the "Company")

Kalahari Key Botswana - Acquisition & Drilling Update

 

Power Metal Resources PLC (LON:POW) the London listed exploration company
seeking large-scale metal discoveries across its global project portfolio
announces an update in respect of the acquisition of an additional 58.7%
interest in Kalahari Key Mineral Exploration Pty Limited ("Kalahari Key" or
"KKME") (the "Transaction").

The steps outlined below will result in Power Metal holding an 87.71% interest
in Kalahari Key, which will hold a 100% interest in the Molopo Farms Complex
Project (the "Project", "Molopo Farms" or the "MFC Project") targeting a
large-scale nickel-platinum group metal ("PGM") discovery in southwest
Botswana.

The conditional acquisition was originally announced on 18 May 2022 which may
be viewed through the following link:

 

https://www.londonstockexchange.com/news-article/POW/kalahari-key-botswana-acquisition/15458701
(https://www.londonstockexchange.com/news-article/POW/kalahari-key-botswana-acquisition/15458701)
 

 

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

"Today Power Metal announces the next steps towards completion of the
acquisition of Kalahari Key shares and the remaining steps that will take
Power Metal's interest in Kalahari Key and therefore Molopo Farms to 87.71%.

Drilling at Molopo Farms continues successfully with the first two drill holes
now complete and downhole geophysics on the first hole underway.  The drill
rig is moving to target area T1-14 in the coming days to commence the third
diamond drillhole targeting a superconductor identified there by a recently
completed moving loop electromagnetic survey.

 A further detailed operational update is expected in the near term."

 

DIAMOND DRILL PROGRAMME UPDATE

The first two holes into target T1-6 have been successfully completed as
follows:

-      DDH1-6(B) drilled to 650.0m

-      DDH1-6(B)(2) drilled to 300.2m

Downhole geophysics is currently underway at DDH1-6(B).

The drill site has been prepared at target T1-14 ready for diamond drilling
into the electromagnetic superconductor target identified. Drilling at T1-14
is expected to commence shortly.

The Company expects to release a further detailed operational update covering
the latest developments at Molopo Farms in the near future.

 

ISSUE OF CONSIDERATION SHARES

Following the receipt of regulatory approvals for the Transaction as announced
on 28 October 2022 Power Metal and as outlined in the original Transaction
announcement of 18 May 2022 (see link above), Power Metal will now issue the
following consideration to the shareholder of Kalahari Key selling their
shares to Power Metal (the "Vendors"):

Initial Consideration:

 

Initial consideration of £807,348 payable through the issue to the Vendors of
46,134,171 new ordinary Shares of 0.1p each in the Company ("Ordinary Shares")
at an issue price of 1.75p per new Ordinary Share ("Consideration Shares") and
warrants over 46,134,171 new Ordinary Shares at a 3.5p exercise price with an
expiry date of 18 May 2024 ("Consideration Warrants").

 

With respect to the Consideration Warrants, Power Metal will hold an
acceleration right, whereby should the volume weighted average Power Metal
share price exceed 7.0p for 5 trading days, Power Metal has the right to serve
written notice to the Vendors of 14 days to exercise and pay for the
Consideration Warrants or they may be cancelled.

 

Further Consideration:

 

In the event, that by 18 May 2024 Kalahari Key or the MFC Project is sold for
US$10million or greater, or a joint venture (or earn-in) agreement is signed
with a potential third party where the potential project spend is US$10million
or greater, Power Metal will issue the Vendors with further warrants over
46,134,171 new Ordinary Shares at an exercise price of 5.0p with a 2 year life
to expiry ending 18 May 2024 ("Further Consideration Warrants").

 

In respect of the Further Consideration Warrants Power Metal will hold an
acceleration right, whereby should the volume weighted average Power Metal
share price exceed 10.0p for 5 trading days, Power Metal has the right to
serve written notice to the Vendors of 14 days to exercise and pay for the
Further Consideration Warrants or they may be cancelled.

 

CONVERSION OF PROJECT EARN-IN

Power Metal is working with Kalahari Key to issue a further 17,033 Kalahari
Key shares to Power Metal to extinguish its previously secured 40% earn-in to
the Molopo Farms Complex Project and restore Kalahari Key to an effective 100%
interest in the MFC Project.

New Power Metal Holding in Kalahari Key

Following the completion of the above steps ("Completion") Power Metal's
holding in Kalahari Key will amount to 37,348 shares or 87.71% of Kalahari Key
issued share capital as follows:

                                                          Shares  % KKME

 Power Metal Original Holding                             5,313   20.79

 Shares Acquired by Power Metal in KKME                   15,002  58.72

 Remaining KKME Shareholders                              5,235   20.49

 Interim Total                                            25,550  100.00

 Shares Issued to Power Metal re Molopo 40% Earn-in       17,033

 Power Metal Final KKME Shareholding                      37,348  87.71

 Remaining KKME Shareholders                              5,235   12.29

 Total Kalahari Key Shares in Issue on Completion         42,583  100.00

 

 

ADMISSION AND TOTAL VOTING RIGHTS

Application will be made for the 46,134,171 Consideration Shares to be
admitted to trading on AIM which is expected to occur on or around 10 November
2022 ("Admission"). The Consideration Shares will rank pari passu in all
respects with the ordinary shares of the Company currently traded on AIM.

Following Admission, the Company's issued share capital will
comprise 1,660,789,092 ordinary shares of 0.1p each. This number will
represent the total voting rights in the Company and may be used by
shareholders as the denominator for the calculation by which they can
determine if they are required to notify their interest in, or a change to
their interest in, the Company under the Financial Conduct Authority's
Disclosure and Transparency Rules.

 

Further information in respect of Molopo Farms may be viewed on the Company's
website through the following link:

https://www.powermetalresources.com/project/molopo-farms-complex/
(https://www.powermetalresources.com/project/molopo-farms-complex/)

In addition, photographs and videos from the Project are and will be available
on the Company's website gallery section, through the following link:

https://www.powermetalresources.com/investors/gallery/molopo-farms-complex-botswana/
(https://www.powermetalresources.com/investors/gallery/molopo-farms-complex-botswana/)

 

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.

(#) following completion of administrative processes for share transfer and
restructuring

 

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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