Power Metal Resources PLC (AIM: POW) the London-listed exploration company and project incubator with a global project portfolio, is pleased to announce a commercial update from its 100% owned Tati Gold Project (“Tati” or the “Project”) located on the Tati Greenstone Belt (“TGB”) near Francistown, Botswana.
Further to the share option agreement (“Option” or the “Agreement”) entered into with Tuscan Holding PTY LTD (“Tuscan”) on 19th June 2024, Power Metal along with Tuscan and its in-country operations team have completed key preparations for the next phase of work, the details of which are outlined below.
Highlights:
· The Environmental Management Plan (“EMP”) for the Tati Gold Project has been formally approved by the relevant government authorities, removing a key permitting milestone required to advance on-site activities including drilling.
· While negotiations relating to the access agreement covering the Project area, and Cherished Hope specifically, took longer than initially anticipated, discussions are now well advanced and nearing finalisation, with execution expected in short order. This will provide access to the licence area to support the planned work programme.
· An extremely strong gold price environment continues to materially support the advancement of the Tati Gold Project and the potential for small-scale mining at Cherished Hope, reinforcing the economic rationale for continued investment and evaluation by the Company’s option partner, Tuscan.
· With the successful receipt of the EMP, and upon finalisation of the access agreement, the Company is pleased to report that next project steps can proceed which include rotary air blast (“RAB”) drilling to define the geometry and continuity of gold mineralisation at Cherished Hope.
· In accordance with the Option, Tuscan will manage and fund the planned work programme. Site visits are expected to commence in the upcoming weeks to progress drill site investigations and preparations, with drilling planned to commence following the end of the current rainy season, anticipated by March/April.
Details
Following approval of the Environmental Management Plan and with the access agreement close to finalisation, the Project has completed the key preparatory steps required to move into its next phase of technical work.
Under the terms of the option agreement, Tuscan is progressing a structured work programme aimed at advancing the Project toward a potential feasibility study. The initial phase will focus on defining the geometry and continuity of gold mineralisation through a programme of rotary air blast (“RAB”) drilling to depths of approximately 60 metres for a planned total of ~600m. This drilling strategy is designed to follow mineralisation down-dip, generate sufficient geological data to support early mine planning concepts, and produce representative samples for preliminary metallurgical test work, while mitigating the effects of supergene enrichment.
In parallel, high-resolution drone imagery will be collected across the Project area to support environmental baseline studies, the development of digital terrain models, and the preliminary design of mining infrastructure.
Subject to receiving encouraging results from this phase of work, applications may be submitted to the relevant authorities to permit small-scale mining operations of approximately 50 tonnes per day, with the objective of progressing the Project toward initial gold production thereafter.
Deal Details
On 19th June 2024 Power Metal entered into a 730-day share option agreement with Tuscan Holding Pty Ltd in respect of Prospecting Licence PL049/2022 at the Tati Gold Project, Botswana. During the option period, Tuscan will fully fund and manage all exploration, evaluation and feasibility activities, including the preparation of a feasibility study, at no cost to Power Metal. Subject to completion of the feasibility study and Tuscan financing the construction and development of a processing plant and associated mine infrastructure, Tuscan may exercise the option to acquire a 75% interest in the licence, with Power Metal retaining a 25% interest free carried to production. Power Metal will retain 100% ownership of all other Tati licences, and the retained interest in PL049/2022 is intended to provide ongoing exposure to potential future cash flow and dividend distributions from any future gold production.
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
Sean Wade (Chief Executive Officer)
+44 (0) 20 3778 1396
