REG - Power Metal Res. - Letter of Intent signed with AMAK

Power Metal ResourcesAnnouncement

10/09/2024 08:00

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RNS Number : 4820D  Power Metal Resources PLC  09 September 2024

10 September 2024

Power Metal Resources PLC

("Power Metal" or the "Company")

Letter of Intent signed with Al Masane Al Kobra Mining Company ("AMAK")

Power Metal Resources PLC (AIM:POW, OTCQB:POWMF), the London listed
exploration company with a global project portfolio, is pleased to announce
the signature of a Letter of Intent ("LOI") to enter into a binding agreement
with Al Masane Al Kobra Mining Company ("AMAK"), a Saudi Arabian listed
exploration and mining company, for Power Metal to spend US$3,000,000 to earn
a 49% stake in the Qatan exploration licence ("Qatan"), in southern Saudi
Arabia (the "Proposed Agreement").

AMAK is a leading publicly listed mining company in Saudi Arabia (listed on
the Saudi Arabia stock exchange Tadawul: 1322 AMAK) with two mines producing
copper and zinc concentrates, and gold and silver ore.  In addition AMAK has
21 exploration tenements throughout Saudi Arabia covering base and precious
metals and industrial minerals to support long term mining activities through
further discoveries. As part of the Proposed Agreement, AMAK will work
alongside Power Metal in order to maintain excellent local stakeholder
relations, support exploration activities, and manage all statutory
requirements associated with AMAK's tenement obligations.  The Power Metal
technical team will be responsible for designing, conducting and funding all
exploration and resource work up to the earn-in amount.

Further to detailed discussions, the Company has proposed a comprehensive
exploration programme at Qatan to satisfy the definition, if applicable, of an
accredited initial Mineral Resource Estimate ("MRE") for the Habdah prospect,
located within Qatan. In addition, Power Metal will advance exploration across
the entire licence to define any further potential mineralisation.

A formal and legally binding agreement containing the full terms and
conditions of the Proposed Agreement shall be executed by the Parties within
90 days of executing the LOI. Although there can be no certainty at this stage
given the non-binding nature of the LOI, the Directors remain confident that
the agreement will become binding subject to further discussions between the
parties. Further announcements relating to the Proposed Agreement will be made
as appropriate.

 Sean Wade, Chief Executive Officer of Power Metal Resources plc,
commented:

"This is a significant development for Power Metal with a major Saudi Arabian
mining company, marking a further milestone in the Company's expansion into
the Arabian Shield. We are delighted to have the support of AMAK and enter
into this LOI with the hope of commencing work at the Qatan exploration
licence in the coming months.

"We look forward to optimising the potential of Qatan and will provide updates
to the market as our collective work progresses."

Geoff Day, Chief Executive Officer of AMAK, commented:

"AMAK is delighted to sign this LOI with the intention to partner with Power
Metal Resources in fully defining the economic potential of its exploration
assets in the most timely and efficient way.  Recognizing the mutual
strengths of strategic alliances such as this allows AMAK to focus on its core
business while at the same time working towards developing the full potential
of the Kingdom of Saudi Arabia's mineral endowment under vision 2030."

Power Metal proposes to use a wide variety of industry-accepted exploration
techniques to advance the license, including, if applicable, defining an
initial MRE with Industry-standard technical work to be carried out at every
stage to ensure best practices and enable any new data to qualify for
inclusion in an accredited MRE to 43-101 or JORC compliance as preferred by
AMAK.

All work carried out by Power Metal will come under the Company's strict ESG
guidelines to ensure safe, responsible and environmentally friendly practices
are maintained to the highest degree at all times.

About the Qatan Exploration licence

The 72.247 km² Qatan exploration licence is located approximately 70 km east
of the AMAK mines, and 32 km to the south of the town of Yadamah, in the
Najran Province, in the south of Saudi Arabia. See Figure 2.

Figure 1. View of Qatan Exploration Licence, Saudi Arabia, June 2024

Figure 2. Location of Qatan Licence, Saudi Arabia.

The last exploration work carried out on the licence was in 2017 when AMAK
engaged SRK Exploration Ltd to conduct a data review and carry out some
additional drilling on the Habdah prospect within the licence.

Within the Qatan licence, AMAK has applied for a low-grade hematite ore Small
Mining Licence after exploration confirmed the absence of precious and base
metals potential, and therefore, this area is excluded from this Proposed
Agreement; it comprises 1.84km(2), the Nuham mining license, the location of
which is shown in Figure 3.

Figure 3: Location of excised Nuham Mining Licence within Qatan Exploration
licence, June 2024

 

About Al Masane Al Kobra Mining Company

AMAK is a leading publicly listed mining company in Saudi Arabia focussed on
exploration and mining for base metals, precious metals and industrial
minerals with two mines (the Al Masane Copper Zinc underground mine and the
Guyan Gold mine) producing copper and zinc concentrates, and gold and silver
dore.  In additional, AMAK has 21 exploration tenements throughout Saudi
Arabia covering base and precious metals and industrial minerals to support
long term mining activities through further discoveries.

AMAK annual production is currently 25-35 koz of gold dore, 40-50 koz of
silver dore, 30-40 kt of copper concentrate, and 60-80 kt of zinc
concentrate.  Copper and zinc concentrates also contains saleable quantities
of gold and silver.

AMAK Exploration plans to extend the life of mine to more than 20 years with
resource developments at deeper levels, brownfield exploration and greenfield
exploration but also through reconnaissance license evaluation and application
of new exploration licenses in the Kingdom.

 

 

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

 Power Metal Resources plc
 Sean Wade (Chief Executive Officer)                                             +44 (0) 20 3778 1396

 SP Angel Corporate Finance LLP (Nomad and Joint Broker)
 Ewan Leggat/Caroline Rowe                                                       +44 (0) 20 3470 0470

 Tamesis Partners LLP (Joint Broker)
 Richard Greenfield/Charlie Bendon                                               +44 (0) 20 3882 2868

 BlytheRay (PR Advisors)

 Tim Blythe/Megan Ray/Alastair Roberts                                           +44 (0) 20 7138 3204

 

NOTES TO EDITORS

Power Metal Resources plc (AIM:POW,OTCQB:POWMF) is a London-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, Saudi Arabia 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.

 

 

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