Power Metal (POW.L) Botswana Molopo Farms – Exploration Update

Proof-of-Concept Exploration Holes Recently Completed Confirm the Presence of Primary Magmatic Sulphides at Molopo Farms Complex Project

Power Metal Resources PLC (LON:POW) the AIM listed metals exploration and development company is pleased to announce an exploration update at the Kalahari Key Mineral Exploration Pty Ltd (“Kalahari Key” or “KKME”) Molopo Farms Complex Project (the “Project” or “MFC Project”), which is prospective for magmatic intrusion-hosted massive and disseminated nickel-copper sulphide and platinum-group element (“PGE”) mineralisation in mining friendly Botswana.

Power Metal currently has a 40% direct MFC Project interest as well as an 18% shareholding in Kalahari Key, for a combined effective economic interest of 50.8%.

Christian Schaffalitzky, Chairman of Kalahari Key, commented:

“The MFC Project is transected by the Thabazimbi-Murchison lineament (“TML”), a major fault system which trends easterly and is believed by Kalahari Key to be the same structure which controlled the emplacement of magma within the highly prolific Bushveld Igneous Complex (“BIC”) located in South Africa. The BIC is one of the world’s major sources of nickel and platinum group metals (“PGMs”).

By extension, the TML is believed to be the feeder for the Molopo Farms Complex (“MCF”), and thus a target for a Voisey’s Bay style major nickel deposit. A feeder zone structure is interpreted to be close to hole K1-6 and extends north-eastwards to the edge of the licence area.

Recently completed proof-of-concept drilling by Kalahari Key, including three widely spaced diamond drillholes targeting large-scale conductive electromagnetic (“EM”) geophysics anomalies, has identified in hole K1-6 the highest nickel grades to date within the MFC. Significantly, thin section analysis of select drill intercepts has identified primary magmatic sulphide mineralisation including pentlandite and chalcopyrite.

With several targets to be followed up, the work plan is still being finalised and the priorities set.”

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

“The results to date from the Phase I drill programme at the MFC Project have successfully demonstrated the validity of the geological model developed by our operating partner Kalahari Key, which has led to the discovery of primary nickel-copper and PGE mineralisation.

Further technical review of the Phase I exploration results is ongoing, and we look forward to providing further information in this regard.

The aim of our venture at the MFC project is the discovery of a major nickel deposit, and we have clearly taken a number of important steps forward with recent exploration. Now we need to finalise the technical review of the work done thus far, and implement next stage exploration work including a Phase II drill programme.”

Questions Share Talk put to Paul Johnson, CEO of Power Metal (POW.L) Q&A

 

PROJECT BACKGROUND:

The MFC Project is a district scale exploration opportunity located in southwestern Botswana.

After extensive preparatory exploration work conducted over the previous five years by Kalahari Key, including airborne and ground-based Electro Magnetic (“EM”) surveys which identified a number of highly prospective kilometre-scale conductive targets, the Project was suitably advanced to commence proof-of-concept drilling late in 2020.

The Phase I diamond drilling commenced at the MFC Project in October 2020 with three holes completed. Due to the size of the Project and prospective conductors identified by the EM surveys, the drilling was conducted as proof-of-concept in order to determine if the conditions within the magmatic system were ideal for the formation of primary magmatic Ni-Cu sulphides, similar to those found within the Bushveld Igneous Complex located along strike to the east.

Significantly, examination of the three proof-of-concept drillholes has successfully identified a magmatic feeder zone which is prospective for the accumulation of Ni/PGE sulphides within the MFC project.

The assay results for core samples submitted from hole KKME 1-14 are outlined below. These results represent the second batch of assay results for the MCF Project and continue to build on the geological understanding of the MFC Projects magmatic feeder zones following the significant Ni-Cu intersections reported previously from drillhole KKME 1-6 (announced 8 April 2021).

DRILL RESULTS:

KKME 1-6

The assay results from angled diamond drill hole KKME 1-6 drilled to a total depth of 597.8 were previously reported on 8 April 2021 and are outlined in table 1 below.

Four select intervals from drillhole KKME 1-6 were analysed at the Scientific Services Geological Laboratories (“SCISERV”) laboratory in Cape Town, South Africa which include 292.7 – 297.5m, 308.5 – 313.2m, 501.8 – 529.1m, and 585.0 – 597.8m.

Significant nickel intersections 1 include:

· 4.8m @ 0.2% Ni from 292.7m

· 4.1m @ 0.49% Ni from 309m, including 1.6m @ 0.72% Ni from 309.6m

· 16.7m @ 0.16% Ni from 501.8m

· 10.9m @ 0.13% Ni from 518.2m

· 3.4m @ 0.28% Ni from 594.4m to end of hole at 597.8m (mineralisation remains open at depth)

Individual samples were also sent to the University of Witwatersrand for thin section mineralogical analysis. The results of this analysis, set out below, successfully identified the presence of primary pentlandite, secondary nickel sulphide and chalcopyrite mineralisation within three drill core samples from KKME 1-6:

· IMK-05139 (0.44m pyroxenite sample from 310m down-hole depth) assayed at 6,999ppm Ni (0.70% Ni) from a primary magmatic, pentlandite-bearing, assemblage.

· IMK-05149 (0.58m pyroxenite sample from 295m down-hole depth) assayed at 6,606ppm Ni (0.66% Ni).

· IMK-05153 (0.54m pyroxenite sample from 297m down-hole depth) assayed at 2,244ppm Ni (0.22% Ni).

· Both IMK-05149 and IMK-05153 contained primary pentlandite within predominant secondary nickel sulphides, arsenides and alloys.

KKME 1-14

The assay results from angled diamond drill hole KKME 1-14 drilled to a total depth of 515.8m are outlined in table 2 below.

Four select intervals from drillhole KKME 1-14 were analysed at the SCISERV laboratory which include 180.0 – 188.8m, 192.2 – 201.2m, 207.9 – 208.5m and 475.4 – 483.22m.

Significant nickel intersections 1 include:

· 6.0m @ 0.17% Ni from 180.0m in harzburgite rock immediately above a fault zone at 186m; and

· 1.0m @ 0.11% Ni from 194.0m in serpentinite with a partial breccia texture within an intra-fault zone totalling 9m @ 0.07%Ni between 192m and 201m downhole.

The drilling intersected the ultramafic rocks of the Molopo Farms Complex directly below 40m of Kalahari sand and duricrust cover and continued to a faulted contact with Transvaal Supergroup quartzite units to a downhole depth of 205.5m. The hole remained in Transvaal rocks through to its end at 515.8m downhole depth.

The anomalous nickel mineralisation identified at shallow depths within KKME 1-14 supports the findings from hole KKME 1-6 (located over 20km away) and further demonstrates there is potential for nickel enrichment in the magmatic intrusive system. Together with the encouraging results obtained from hole KKME 1-6, the combined drill hole findings provide important geological information which will help plan a Phase II drill programme which aims to vector towards significant quantities of magmatic nickel-copper mineralisation within this fertile magmatic system.

KKME 1-14 was drilled targeting a broad kilometre-scale EM anomaly which can be traced further to the east, which is the known orientation of magmatic layering within the MFC. This same EM anomaly extends towards the west and then swings southwest into the northeast-southwest trending sheer zone which is interpreted to represent a feeder zone on the Project. As a result, Kalahari Key is of the belief that this conductive target potentially represents a much larger Ni-Cu mineralised system than originally understood.

NEXT EXPLORATION STEPS:

Technical work is continuing including further core inspection of the third drill hole K1-11a and assay testing of samples from this hole together with assay testing of additional samples from K1-6 where further sulphides have been identified.

A further update will be provided in due course summarising all the technical work completed.

Notably, the technical work includes planning a Phase II drilling programme which is being designed to intersect the up-dip part of the mineralised pyroxenites identified in KKME 1-6, as well as where the east-west oriented EM anomaly intersects the magmatic feeder zone. Further information in respect of this work and associated exploration plans will be provided in due course.

Assaying Technique and Results

Further Details

Hole KKME 1-14 was drilled at an azimuth of 345° with a dip of 60° to a final depth of 515.8m. The hole was designed to intercept a conductive body modelled from ground-based TDEM geophysical survey which was expected to lie at roughly 500m down-hole depth. The cause of this prospective conductor is still unknown.

Drill hole KKME 1-11a, the third and final hole of the proof-of-concept drill programme, is located in the Project’s Chipo (Gift) Northern Target Area, 1,250m west of 1-14.

References:

1: Significant Ni intersections derived from weighted averages of samples intervals above a nominal 0.13%Ni. Figures are rounded. 10,000ppm = 1%.

2: Assay results for diamond drill hole KKME 1-6 were announced 8 April 2021.

Feeder zone The plumbing system from which magma is supplied into the intrusive from the lower crust. These can often form as elongated dykes at the base of an ultramafic layered intrusion. Sulphide mineral accumulations can often form in the vicinity of the feeder zone.

Harzburgite Harzburgite is a type of peridotite ultramafic igneous rock, with no or very little monoclinic pyroxene and consisting only of olivine and orthorhombic pyroxene bronzite. Harzburgite typically forms by the extraction of partial melts from the more pyroxene-rich peridotite.

Serpentinite A metamorphic rock formed as a result of the low temperature anaerobic oxidation of ultramafic rock in the course of which density is reduced and volume increased by the addition of water, and nickel and other elements undergo remobilisation as a result of hydrothermal activity.

Ultramafic rock An igneous rock in which has a very low silica content and in which more than 90% of the rock is composed of magnesium and iron-rich minerals like pyroxenes, amphiboles, and olivine.

COMPETENT PERSON STATEMENT

The drilling and sampling programme has been overseen on site by Mr. Ian McGeorge MSc CGeol FGS a qualified person and chartered geologist working on behalf of the independent mining consultancy The MSA Group (“MSA”). Information in this announcement relating to the exploration drilling results is based on data reviewed by Mr McGeorge. Mr McGeorge has sufficient experience relevant to the style of mineralisation and type of deposit under consideration, and to the activity which he is undertaking to qualify as a Competent Person under the AIM Rules – Note for Mining and Oil & Gas Companies. Mr McGeorge consents to the inclusion of the exploration results in the form and context in which they appear.

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/ or contact:

Power Metal Resources plc

Paul Johnson (Chief Executive Officer)

+44 (0) 7766 465 617

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking large scale metal discoveries

The Company has a global portfolio of project interests including precious, base and strategic metal exploration in North America, Africa and Australia. Project interests range from early stage greenfield exploration to later stage exploration prospects subject to drill programmes.

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 global metals exploration.


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