Power Metal Resources PLC (LON:POW) the AIM listed metals exploration and development company is pleased to announce that following due diligence work the Company has exercised its option to acquire the Coco East Property (“Coco East” or the “Property”) located on the prospective Schreiber-Hemlo Greenstone Belt in north-western Ontario, Canada.
Coco East is the second of four gold exploration properties upon which the Company has an exclusive option to acquire a 100% interest, (the “Option”) (as announced 26 January 2021) and follows the McKellar option exercise which was announced 18 February 2021.
Paul Johnson Chief Executive Officer of Power Metal Resources plc commented:
“Exercising the Option over the Coco East Property further strengthens Power Metals’ landholding in Ontario, following directly on from the acquisition of the McKellar Property which was announced last week.
Coco East is sited upon the eastern end of the Big Duck Lake Porphyry intrusive which is associated with over twenty known gold and/or base metal occurrences including significant gold intersections which were drilled in a neighbouring property during 2017. The property is also directly east of Superior Lake Resources’ Pick Lake / Winston Lake Zinc Project which is currently advancing towards a high grade zinc mine restart.
We are continuing our due diligence review of the remaining two option properties and will provide a further update in due course .”
COCO EAST PROPERTY OVERVIEW
– Located upon the Schreiber-Hemlo Greenstone Belt, Coco East sits at the eastern end of a 4.5km long by 1km wide quartz feldspar porphyry intrusion (the ‘Big Duck Lake Porphyry’) that can be associated with up to twenty-two known gold and/or base metal occurrences.
– Geology of the property consists of intrusive porphyry, ultramafic, metavolcanic and metasedimentary rock packages prospective for both gold and volcanogenic massive sulphide (“VMS”) style copper-lead-zinc-silver mineralisation.
– Regional magnetics survey data shows distinct areas of interest within the property including magnetic highs associated with the eastern end of the Big Duck Porphyry and magnetic ridges which may be indicative of structural faulting and deformation associated with the intrusive event.
– Located approximately 3.5km east of the Coco-Estelle Deposit where diamond drilling during 2017 intersected significant intervals of gold mineralisation including 11m @ 1.96g/t Au from 42m and 5m @ 5.9g/t Au from 63m.1 This is part of the Big Duck Project held by Canada listed CBLT Inc (TSX-V:CBLT) which abuts the Coco western boundary.
– Also 8.4km east of Australian listed Superior Lake Resources (ASX:SUP) high-grade Pick Lake / Winston Lake Zinc Project which has a Resource of 2.35 Mt at 17.7% Zn, 0.9% Cu, 0.38 g/t Au and 34 g/t Ag and for which a mine re-start Bankable Feasibility Study was published in August 2019. 2
– Three historical drill holes are known to exist within the centre the property (on three Claims), these were drilled by Falconbridge Copper Corporation in 1984. Drill hole BD6 is reported to have assayed up to 1.74g/t Au although the exact nature of this intersection has yet to be verified by obtaining the historical core logs. The remainder of the property is considered under explored.
– Situated approximately 20 km due north of the town of Schreiber, Ontario on the Trans-Canada highway. Access to the property is via an old logging road and all-terrain vehicle (“ATV”) trails. Big Duck Lake is located on the western side of the property.
COCO EAST CLAIM STATUS
– Consists of a total of 30 Single Cell Mining Claims (“Claims”) covering a total area of circa 6.4km2.
– Claims are valid through to 20 August 2022 upon which they can be renewed on an annual basis. For renewal the Coco East Claims will require an aggregate work spend of CAD$12,000 (circa £6,912) prior to the individual Claim renewal dates.
The vendors of the Option (the “Vendors”) are a consortium led by established local prospector Brian Fowler who was the Vendor of the Hemlo North Gold Project acquired by Power Metal as announced on 21 January 2021.
In exercising the Option to acquire a 100% interest in the Coco East Property POW will make the following cash and equity consideration:
The POW shares payable as consideration are new ordinary shares of 0.1p each in the Company at an issue price of 3.0 pence per share (“Acquisition Shares”). The cash costs of the acquisition are funded from Power Metal’s existing Canadian Dollar cash account.
The Vendors retain a 2% net smelter royalty (“NSR”) on Coco East, Power Metal may purchase 1% of the NSR, at any time, by making a cash payment to the Vendors of CAD$500,000.
The Vendors will continue to work with Power Metal in the local management of any new properties acquired through this transaction; the development and implementation of exploration plans and the identification of further new opportunities.
– Ongoing exploration spend will be at the discretion of Power Metal as the 100% owner of Coco East.
– Preliminary exploration work is expected to include both remote sensing data interpretation and ground-based fieldwork with systematic soil sampling and geophysics expected to yield defined targets for future drill testing.
– The Province of Ontario has an established mineral exploration industry with a large number of local exploration contractors that could be engaged to fulfill the planned work on a cost-effective basis.
Admission And Total Voting Rights
Application will be made for the 576,000 Acquisition Shares to be admitted to trading on AIM, which is expected to occur on or around 2 March 2021 (“Admission”). The Acquisition 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 1,133,718,730 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.
COMPETENT PERSON STATEMENT
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.
1: GTA Resources and Mining Inc announcement, 29 January 2018 https://www.gtaresources.com/assets/jan-29-2018-big-duck-final-re-run-gold-sample.pdf
2: Superior Lake Resources Pick Lake / Winston Lake Zinc Project: https://superiorlake.com.au/pick-lake-winston-lake-zinc-project/#:~:text=The%20Project%20is%20a%20high,ASX%20announcement%2028%20August%202019
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
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