Option to Acquire New Copper-Cobalt Interest

RNS Number : 6289H

Power Metal Resources PLC

01 August 2019

 

01 August 2019

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

Option to Acquire New Copper-Cobalt Interest

Power Metal Resources plc (LON:POW) the AIM listed African focused metals exploration and development company announces it has secured an option to acquire a 70% interest in PR 13479, ("Permis de Recherches")  a license prospective for cobalt and copper to the north and east of the Tondo cobalt-copper mine (the "N Tondo copper-cobalt License" or the "License") in the Democratic Republic of the Congo ("DRC"). 

Paul Johnson, Executive Director of Power Metal Resources plc commented: "This License is in a highly prospective area for copper-cobalt, near an existing mine, and is primarily a cobalt target.

We are fortunate to have secured this option at an early stage when the presence of anomalous cobalt has already been proven. However, the shallow depth at which soil sampling has been carried out means the results derive from material where the mineralisation may have been reduced by weathering.

If we test deeper in the regolith, we may get results of higher tenor that show more of the potential of the License. Initially we propose to do this by termite mound sampling across the license.

That may be followed by a small number of pit excavations to take us down to the bedrock, which we expect to encounter at about a depth of 10m.

Given the location of the License, and the results so far, this is a very exciting project where our objective is to prove up a shallow, open-pittable and high-grade resource."

License Highlights:

·    The N Tondo copper-cobalt License is close to the producing Tondo Cobalt mine in similar geology in the undifferentiated Roan breccia;

·    This is a known Cobalt-prospective area that is attracting increased exploration attention; 

·   Soil sampling shows presence within License of anomalous cobalt at 500-750 parts per million ("ppm") and occurrences within License are on trend from nearby occurrences of R2 rocks;

·  POW now intends to undertake a termite mound sampling programme across the License to test mineralization at greater depth than the 27-30cm soil sampling depth;

·    The License may be viewed on the Company's website through the following link:

https://www.powermetalresources.com/NorthTondoCobaltLicenseAugust2017

Acquisition Terms:

·   POW has paid US$5,000 for a 60 day exclusivity period within which it will carry out further legal and technical due diligence, prepare joint venture documentation, and carry out a termite mound sampling programme;

·   At any time within this period POW can notify the vendor, Société Co-Operative Minière et de Suis-Traitance SARL ("SCOMIS") of its intention to proceed with the joint venture ("JV");

·   Upon execution of the JV agreement, POW will pay US$50,000 to SCOMIS. Upon commencement of mining, POW would then make a further payment of US$250,000 to SCOMIS;

·    If the JV proceeds, SCOMIS will be free carried up to a decision to mine.

Further details of the License

PR 13479 is a license with an area of four mining squares (approximately 3.5 sq km) in Lualaba province of the Democratic Republic of Congo. It lies to the North and East of Kolwezi and to the North and West of the Tenke-Fungurume mine. The License is held by SCOMIS, a Congolese company owned by local businessmen, with the license expiring  in August 2022 and is then renewable for a further term of 5 years.

The License is in a geological environment known to host cobalt and copper mineralization and also contains some dispersed sections or fragments (known as écailles) of R2 mineralisation, a part of the Roan sequence that is the host of much of the Congo's cobalt endowment. Some of these sections are visible within the local area as elevated ridges. 

Some 5 km to the south and west lies the Tondo mine, a cobalt mine owned by Lerexcom sprl, a company of Congolese conglomerate Groupe Ledya, and Gécamines (La Générale des Carrières et des Mines), that also produces copper. 

The success of Tondo has led to an increase in exploration in the area. Neighbouring ground held by SOMIKA sarl is at advanced exploration stage and CHEMAF sarl is currently following up initial positive results with visible mineralisation at several copper and cobalt prospects.

Exploration of PR 13479 by SCOMIS has shown the presence of cobalt within the License. An early sample in the North of the license prepared as a soil sample but containing rock chips was measured at over 4% Cobalt by an x-ray fluorescence spectrometer ("XRF"). Recently, soil samples taken on a 200m x 100m grid from 27-30 cm depth across the License were tested by XRF and returned anomalous cobalt in several areas.

Samples in the South of the License also contained rock chips of Roches Argilo-Talqueuses, ("RAT" or "red RAT"), the upper subdivision of the R1 subgroup of the Roan Group (a metasedimentary series of Neoproterozoic rocks particularly associated with the south-eastern Congo) and of Calcaire a Minerai Noire ("CMN", or Black Ore Limestone), the R.2.3 subdivision of the R2 subgroup. Both are indicator horizons for R2 mineralisation.    

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 (Executive Director)	[phone]
SP Angel Corporate Finance (Nomad and Joint Broker)
Ewan Leggat	[phone]

SI Capital Limited (Joint Broker)

Nick Emerson                                                                                                                    [phone]

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed African focused metals exploration and development company exploring for the key metals used in power generation, transmission, storage and utilisation. The Board and team of advisors, who have proven expertise in exploration, mining and project generation, have identified an opportunity to utilise the Company's position to become a leader in the London market for investors to gain exposure to the power metal commodity suite, particularly cobalt, lithium, copper and nickel. 

 

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