Australia Gold JV - Blue Ribbon Project Update

RNS Number : 2560T

Power Metal Resources PLC

16 July 2020

 

16 July 2020

Power Metal Resources plc ("POW" or the "Company")

Australia Gold JV - Blue Ribbon Project Update

Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to announce an update from the Blue Ribbon project, ("Blue Ribbon", the "License" or the "Tenement") one of eleven license applications within its Australian gold joint venture ("JV") company Red Rock Australasia Pty Ltd ("RRAL") in which POW has a 49.9% interest.

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

"I am pleased to launch the first report from the review of historical exploration data, in this case in respect of the Blue Ribbon project.

Despite being one of the smaller projects, the historical review has highlighted some significant findings ranging across 70,000 ounces of historical gold production, gold nuggets up to 85 ounces and pre planned drill targets from earlier exploration work conducted by previous license holders.

We are particularly excited by this project, given the information provided below, and the prospect after license grant of the finalisation of drill targets."

BACKGROUND

RRAL has commissioned historical reports and targeting assessments of its 11 license applications, and the first of these, for the Blue Ribbon license application (EL007285), has been received.  The License is 5km north of the Ballarat East Mine.

In its announcement of 4^th May 2020 the Company stated that detailed information and references for the license applications would be set out, once received, on the Company's website, and the information below will shortly be posted there.

KEY POINTS FROM REPORT

·The historical records show reported historical production of 70,000 ounces of gold over 2km of the Deadhorse Lead within the Blue Ribbon project area, all in 19^th century;

· Six gold nuggets between 10 and 85 ounces were recorded from the workings of the Ballarat Extension Company on the Blue Ribbon project area;

· The primary exploration target is the northern extension of the Ballarat West Goldfield, assumed to be the source of the palaeoplacer gold on the Tenement;

· Next exploration steps include finalisation of drill targets and implementation of a three hole, 1000m drill program, subject to license grant and local approvals;

· Blue Ribbon is now a priority project for RRAL.

FURTHER INFORMATION 

The term "Lead" in the report below refers to a gold-bearing alluvial deposit in a terrace or stream bed; and a "Deep Lead" to ancient alluvial deposits buried below non-gold bearing strata.

The Company is preparing a detailed glossary of exploration terms which will be uploaded to a new Technical Library section on the powermetalresources.com website by the end of July 2020.

The report runs as follows: 

"License Application EL007285- North-West of Ballarat

Tenement ID	Local ID	Size (km2)	Mapping Sheet (1:100,000)	Municipality	Current Status
EL007285	NW Ballarat	8	Ballarat	Ballarat	Application

1.1.1.  Regional Geology

EL007285 is located within the Bendigo - Ballarat Zone of the Lachlan Fold Belt. The Bendigo Zone has an average width of 100km and extends between the Avoca and Mt William Faults.

The basement stratigraphy of the Tenement area consists of folded N-S striking (result of E-W compression) interbedded turbidite deposits of sandstone and siltstone of the Ordovician Castlemaine Group. (Taylor et al. 1996)¹. These sediments carry a pervasive north-south foliation. (Horwood, 2011)².

1.1.2.  Local Geology

The Ordovician rocks are mostly concealed by Newer Volcanics with minor Pliocene colluvial. The only exposure of Ordovician sediments on the Tenement occurs in the far eastern portion of the Tenement and are typical of those in the Ballarat field. Multiple Cainozoic basalt flows have buried deep leads.

A graphitic slate zone (Black Slate) occurs throughout the Ballarat West line and is essentially the only significant lithological unit that can be extrapolated with confidence across this line. This zone is not observed on the Ballarat East line.

The black slates of Ballarat West is a zone varying in thickness from 22m to 44m, and consists of series of graphitic, dolomitic and pyritic black slates, pyritic mineral seams, laminated quartz lodes, crushed quartz and sandstones.

The lode generally occurs close to the lowest black slate member in the zone, although two parallel lodes have been worked on laminated quartz in several mines including the South Star and New Kohinoor.

Being directly associated with the lode, the black slates have been well recorded in most historical texts and workings and also in recent drill holes where they occur, although in some mines including the Sir Henry Loch, the entire zone has not been fully exposed in development.

1.1.3.  Mineralisation

The northern extension to the Ballarat West Goldfield is projected to occur in the eastern portion of the Tenement.  The mineralisation in this field is characterised by laminated quartz reefs hosted within black slate beds containing bedding parallel shears confined to west dipping fold limbs. The thrust faults controlling this system extend locally across the fold hinges into the east-dipping limbs as dilatant jogs within which quartz-vein stockworks (tension vein arrays) were mined. (Horwood, 2011)

Several west draining deep leads occur in the central area of the Tenement and are typical of those found in the Ballarat field.

1.1.4.  Mining History/Production

The Deadhorse Lead produced 70,000 ounces of gold over 2 km (Chintock, 2008)³ of strike length downstream from the where the lead crosses the projected northerly extension of the Ballarat West goldfield.

Refer to Figure 1 - Ballarat West Goldfield and target position through the following link:

https://www.powermetalresources.com/p/215/ballarat-west

Individual deep lead mine production from the major mines on the Tenement is listed in Table 1. Numerous small mines located on the Tenement are lacking individual production records.

Table 1- Major mine production from EL007285

Mine	Production (Oz)
Ballarat Extension	21,396
Rose Hill GM	17,137
Great Northern Junction	6,233
Nil Desperandum Co	3,595

There is no record of primary gold production on the Tenement.

The quartz mines of the Ballarat West goldfield have produced a recorded 800,000 ounces of gold at an average grade of approximately 14 grams per tonne. A further 6 million ounces of gold is estimated to have been won from the ancient river channels which cross the field. (D'Auvergne, 1998)⁴.

1.1.5. Nearby Mining Activity

The Ballarat Gold Mine is currently mining the Ballarat East line, 5 km's south of the Tenement.

1.1.6. Exploration History

No exploration has been completed on the Tenement since the 19th century short of data collation and target generation.

1.1.7. Exploration Strategy

The primary target on this Tenement is the northern extension of the Ballarat West Goldfield, assumed to be the source of the palaeoplacer gold on the Tenement.

This target is only 4 km north of the main Ballarat West field and 2 km north of its northernmost mined quartz reef - the projected Ballarat West field would fall within the Tenement over the zone considered to be the main target area based on palaeoplacer gold occurrences.

In order to define this target, the following processes should be considered:

· Investigate drainage channel directions to narrow the zone where the gold originated from.

· Review and interpret magnetic images to potentially interpret structures masked by the basalt.

Other information to note:

· Six gold nuggets between 10 and 85 ounces were recorded from the workings of the Ballarat Extension Company and are unlikely to have travelled far from their source. (Chintock 2008)

· Quartz veining was been recorded in several palaeoplacer mines on the Tenement.

It is recommended that diamond drilling be used once the base of the basalt has been reached to allow the position within the fold sequence of the Ballarat field to be determined. The lodes of Ballarat West and for some-part Ballarat East are lithologically controlled.

This area remains relatively undeveloped in regard to residential development, allowing the potential to establish multiple drill platforms.

Budget

Drilling- Once target is finalised, a 1000m drill program consisting of 3 individual holes would cost approximately A$150,000 including mobilisation and associated drilling costs."

¹  Taylor D.H., Whitehead M.L., Olshira A and Leonard J.G. 1996. Ballarat 1:100,000 map geological report 101, Geological Survey of Vistoria

²  Horwood D.J., 2011. Oroya Mining Ltd EL 4943, Ballarat North Project, Annual Report for the period ending 31 December 2011.

³  G. Chintock, 2008. Annual Report to Dept of Primary Industries, VIC for EL 4943.

⁴  D'Auvergne P, 1996. Ballarat Goldfields Pty Ltd. EL 3018, Ballart Gold Project, Annual Report for the period ending 31 December 1998. 

Competent Person Statement

The technical and related information in this report relates to exploration results based on information from third parties and data compiled by David Sharp, BAppSci, MAIG, who is a member of the Australian Institute of Geoscientists.

Mr Sharp has sufficient experience in the style of mineralisation and type of deposit under consideration. Mr. Sharp consents to the inclusion in this announcement of the matters based on his information in the form and context in which it appears. Mr Sharp is a Senior Geological Consultant at Oreteck Mining Solutions, Melbourne.

FURTHER INFORMATION:

Joint Venture Company - RRAL

RRAL is a joint venture company 49.9% owned by POW and 50.1% by Red Rock Resources plc (LON:RRR). Paul Johnson, CEO of POW and Andrew Bell, Chairman of RRR and POW, are directors of RRAL.

RRAL has lodged applications for eleven new gold exploration license areas covering 1,839 sq km in the Victoria Goldfields of Australia as follows:

License Application Number	Project Name	Area (sq km)
EL007271	Blue Whale	133
EL007281	Blue Chip	74
EL007282	Blue Sky	489
EL007285	Blue Ribbon	8
EL007294	Red Queen	130
EL007301	Mt Bute	85
EL007327	Blue Stocking	60
EL007328	Blue Yonder	168
EL007329	Evergreen	486
EL007330	Blue Angel	202
EL007385	Sardinia	4
Total		1,839

ONLINE MAP

Readers wishing to view the current application footprint may do so through the following link to the POW website: https://www.powermetalresources.com/p/207/rrraustralasia-gold-project-footprint

The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No.596/2014 and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.

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

Power Metal Resources plc
Paul Johnson (Chief Executive Officer)	[phone]
SP Angel Corporate Finance (Nomad and Joint Broker)
Ewan Leggat/Charlie Bouverat	[phone]
SI Capital Limited (Joint Broker)
Nick Emerson	[phone]
First Equity Limited (Joint Broker)
David Cockbill/Jason Robertson	[phone]

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale discovery of precious or base metals.

The Company has a portfolio including key interests in Australia, Botswana, Cameroon, The DRC and Tanzania.  The interests represent large scale exploration projects targeting mainly cobalt, copper, gold, nickel and platinum group metals. Project interests range from early stage greenfield exploration to later stage drill ready prospects.

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company's position to become a leader in the London market for investors wishing to gain exposure to proactive metals exploration.

 

END

 

 

MSCDZGMNZVRGGZM