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Power Metal #POW – Australia Gold Joint Venture – Further Licences Granted
Two further licences granted with the JV now holding seven granted licences
Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to announce an update in respect of Red Rock Australasia Pty Ltd (“RRAL”) a joint venture company with gold exploration interests near the historic mining centre of Ballarat in the Victoria Goldfields.
Power Metal has a 49.9% interest in RRAL, with Red Rock Resources plc (“Red Rock”)(LON:RRR) holding a 50.1% interest.
Highlights:
- Following grant to RRAL of its first five gold exploration licences in Victoria, announced on 2 February 2021 and 17 March 2021, a further two licences have now been granted:
- EL007329 (Evergreen) covering 484 sq km
- EL007301 (Mt Bute), covering 85 sq km.
- The seven granted licences in Victoria now cover an exploration area of 848 sq km, including numerous old mines and workings and identified geological targets.
- With the bulk of the ground covered by the previously prepared NI 43-101 technical report (1) now at granted status, the IPO process for RRAL will accelerate.
(1) A copy of the NI 43-101 technical report may be viewed on the Power Metal website through the following link: https://www.powermetalresources.com/Uploads/2020-09-21-0078-Caracle-KineticsRM_RedRock_NI43-101_Sept21_2020_F_complete.pdf
Paul Johnson, Chief Executive Officer of Power Metal Resources commented :
“Today’s news marks a key point in the development of RRAL with the grant of the Evergreen tenement which is one of the larger licence applications and sits in an area of particular interest as demonstrated by increasing investment by peer companies in project acquisition and exploration.
Grant of the two licences moves the IPO process front and centre. We believe that the core interests of RRAL forming the basis for an IPO on the Canadian capital markets represents one of the most comprehensive investment opportunities in the Victoria Goldfields for Canadian and international investors.
RRAL are therefore moving forward at pace with both project exploration and corporate listing developments.”
FURTHER INFORMATION
Joint Venture Company – RRAL
RRAL is a joint venture company 50.1% owned by Red Rock and 49.9% owned by Power Metal Resources plc. Paul Johnson, CEO of Power Metal and Andrew Bell, Chairman of Power Metal and Red Rock, are directors of RRAL.
Granted Licences
RRAL has seven granted licences over an area of 848 km2 and covering high priority areas where RRAL has early drill targets that it is developing.
|
Licence Number |
Project Name |
Area (km2) |
|
EL007271
|
Blue Whale |
133 |
|
EL007281
|
Blue Chip |
74 |
|
EL007285
|
Blue Ribbon |
8 |
|
EL007301 |
Mt Bute |
85 |
|
EL007327 |
Blue Stocking |
60 |
|
EL007329 |
Evergreen |
484 |
|
EL007385 |
Sardinia |
4 |
|
Total |
|
848 |
Applications
RRAL has licence applications in process for nine other new gold exploration licence areas covering approximately 1,488 km2 in the Victoria Goldfields of Australia as follows:
|
Licence Application Number |
Project Name |
Area (km2) |
|
EL007282
|
Blue Sky |
489 |
|
EL007294 |
Red Queen |
130 |
|
EL007328 |
Blue Yonder |
168 |
|
EL007330 |
Blue Angel |
202 |
|
EL007460 |
Kilmore West |
349 |
|
State land within EL007271
(EL007505 EL007506 EL007507)
|
|
(9) (9) (8) |
|
EL007540* (3 competing applications)
|
Outer Ballarat |
148 |
|
Total |
|
c 1,486 |
* Balmaine Gold Pty Ltd, Mercator Gold Australia Pty Ltd, and Loddon Gold Pty Ltd have put in competing applications the same day as RRAL for the ground covered by EL007540. The application considered to have greatest merit will eventually be given priority.
In addition to the Victoria Goldfields above RRAL has also made exploration licence applications in Western Australia as included in the table below. Please note where indicated below and there is another applicant the application will be subject to a ballot.
|
EL45/5859 (One competing application) |
Paterson |
227 |
|
EL45/5885 |
Pilbara/Paterson |
70 |
|
EL45/5881 (One competing application) |
Pilbara/Paterson |
33 |
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 |
|
|
|
|
SP Angel Corporate Finance (Nomad and Joint Broker) |
|
|
Ewan Leggat/Charlie Bouverat |
+44 (0) 20 3470 0470 |
|
|
|
|
SI Capital Limited (Joint Broker) |
|
|
Nick Emerson |
+44 (0) 1483 413 500 |
|
|
|
|
First Equity Limited (Joint Broker) |
|
|
David Cockbill/Jason Robertson |
+44 (0) 20 7330 1883 |
Monetary Stimulus = Currency Devaluation = Increasing Gold Demand
As the world starts to emerge from the first wave of the COVID-19 crisis, the implications for the unprecedented monetary stimulus measures employed by Governments around the globe to support citizens in lockdown are becoming ever clearer.
As stock markets roar back from the coronavirus-led rout, advisers to the world’s wealthy are urging them to hold more gold, questioning the strength of the rally and the long-term impact of global central banks’ cash splurge, Reuters writers commented.
In a note for Kitco News, Allen Sykora noted Gold had started a new week on firmer footing amid worries about the rising number of COVID-19 cases. “The price of gold jumped to its highest in more than a month this morning ($1,757), after surging coronavirus cases heightened concerns over a delay in global economic recovery,” said a research note from commodities brokerage SP Angel. Analysts cited news reports showing that while social distancing in March and April slowed the spread of the virus, reopening in a number of U.S. states and European nations has coincided with a new wave of infections.
Commerzbank believes the U.S. economic recovery is “hanging in the balance” with a likelihood of “increasing calls for the U.S. government to implement further stimulus measures, especially as [Federal Reserve Chair Jerome] Powell had already called for more fiscal stimulus during his virtual testimony before the U.S. Congress last week,” Commerzbank also believes the U.S. Fed is “likely to keep the pedal to the metal – i.e. to expand its balance sheet”… and thus the issue of currency debasement/inflation ..”will remain high in the minds of market participants.”
Geologists speculating with fees for professional services
This ‘pedal to the metal’ approach to monetary easing and the conseqential strength in gold continues to drive investor interest in junior gold explorers. Increasingly this sector is seeing mining geologists taking fees for their work in shares as well as cash, as armed with knowledge and experience, a successful drilling campaign can have a transformational effect the valuations of small cap explorers with quality projects, meaning that professional fees can potentially multiply in value. The majority of small mining companies however only have one or two key projects in their asset portfolio, so micro-cap explorers that own a broad spread of assets are particularly sought after.
AIM listed ECR Minerals (AIM: ECR) is firmly in the latter category. The company 100% owns the Bailieston and Creswick projects in Central Victoria, Australia, and also has financial interests in the Avoca, Moormbool and Timor projects following the sale of those licenses, detailed below. In addition ECR has earned a 25% interest in the Danglay epithermal gold project in the north of the Philippinesand and holds a net smelter royalty on the SLM gold project in Argentina.
Creswick
Creswick has long been viewed as a potential pivot project for ECR after the highest grade duplicate result of 80.97 g/t gold came from a 1 metre interval that originally assayed 44.63 g/t, confirming the original findings announced on 8 May 2019. Referred to by ECR as ‘nuggety gold mineralisation’, a study by pre-eminent consulting geochemist Dr Dennis Arne, whose experience includes extensive consultancy at the highly successful Fosterville gold mine in Central Victoria, underlined the significant gold exploration potential at Creswick
Bailieston
Bailieston is also at the centre of the current gold exploration boom in Victoria, located close to the highly successful Fosterville mine owned by Kirkland Lake Gold. The project potential was underlined by the arrival of mining giant Newmont Exploration with a license application for ground immediately to the north of ECR’s Black Cat prospect. The Fosterville mine is located approximately 50km west of the Bailieston project.
Flagship Projects Set to Deliver Value
The focus on Creswick and Bailieston prompted the board decision in April 2020 to sell three further Victoria licences (the Avoca, Moormbool and Timor gold exploration projects) to TSX-V listed Fosterville South Exploration Ltd for an upfront cash payment of A$500,000, plus additional potential of a further A$2 million based on resource estimates and gold production.
This, added to the two recent R&D cash refunds and the GB£500,000 placing at 0.5p mean that ECR are fully funded and ready to spend on further developing the two flagship assets.
And with external parties currently reviewing data on the Bailieston and Creswick gold projects with a view to potential commercial transactions and joint venture opportunities, the ECR board believes that both projects “hold considerable potential and inherent value for the Company.”
Currently valued at just GB£3.9m, there are great expectations for ECR in the coming months despite the restrictions resulting from the COVID-19 lockdown. Given the compelling backdrop in the Gold market and the ‘pedal to the metal’approach to monetary easing by Governments around the world, ECR shareholders could be set for a bonanza if Creswick and Bailieston come good.
References:
As investors await ECR’s Creswick assay results, Windidda survey confirms potential for Gold.
Anticipation builds on Creswick Assay results
ECR’s investors are eagerly awaiting the remaining assay results to be revealed from the whole-of-bag testing process at the Company’s Creswick Gold project.
If the partial assay results released on the 27th August 2019 are anything to go by, then investors definitely have something to be hopeful about. The 17 samples tested demonstrate a substantial increase in average gold grades.
The remaining 113 samples, which are expected to be released in the near future will provide an important insight into Creswick’s potential million ounce resource. So be sure to keep your eyes peeled for any announcements over the coming weeks.
Windidda Gold Project – Farm-In offer and Positive GeoPhysics survey
It’s not just Creswick grabbing attention though. ECR revealed at the end of September that they had been approached by a listed mineral exploration company to farm into their Windidda Gold Project in Western Australia.
Whilst ECR have decided not to proceed with the farm-in, another company looking to come on board is certainly an encouraging indication of the project potential.
ECR may also be expecting some better offers to come to the table. Given how sought after licenses are in the Yilgarn Craton, not to mention difficult to come by, such a development wouldn’t necessarily come as a surprise given that the area is home to around 30% of the world’s known gold reserves.
The decision to retain 100% ownership is also an indication of ECR’s own strong belief in its value and confidence in its ability to go it alone.
“We were fortunate to get the licences at the Yilgarn Craton, given the area’s excellent reputation” CEO Craig Brown told Mining Maven
“The permissions we have applied for currently are covered by a layer of other rocks, but, most importantly, underneath have significant exposure to that same critical greenstone belt that our peers are utilising successfully. The idea is that we want to drill down through the upper layers into the greenstone, where the large majority of the gold deposits in the Yilgarn Craton are contained. There has been some geophysics completed in the past that boast very positive indications for our work,” he added. 
On the back of this, ECR commisioned Western GeoPhysics to process and interpret existing airborne magnetic and ground gravity data. The survey results announced mid October 2019 noted that the depths to magnetic sources were shallowest on a highly magnetic trend striking NNW-SSE in the western half of the Windidda project area. Added to this, previous gold intersections drilled by North Ltd (NL) in 1998-2000 coincide with the highly magnetic units in the NL Bermuda project area, which lies outside the Windidda project area to the south.
This magnetic and mineralised ‘Bermuda’ trend projects into Windidda exploration licence application E38-3369, and the modelling results indicate shallow feasible drill targets there.
“The results of the study by Western Geophysics are most encouraging and demonstrate real potential for the discovery of gold mineralisation”, said Brown.
“The under-cover greenstone exploration model has been successfully tested to date by Greatland Gold at its Ernest Giles project located approximately 125km east of ECR’s Windidda gold project.”
Gold price rally could continue into the long-term
The push by ECR throughout the year to develop and expand its gold exploration activities could not have been timed better. 2019 has been a fantastic year for the precious metal. The gold spot price has rallied by over 25% during the past year, currently hovering around $1,505 per ounce and predicted to continue delivering long-term growth.
Several geopolitical and economic issues across the world have contributed to this incline and are likely to shape prices further.
From a volatile oil market, escalating concerns regarding the US-China trade war, ongoing Brexit uncertainty, talk of a global recession, negative bond yields and falling interest rates – all these are resulting in investors turning towards gold.
Speaking on Palisade Radio, Resource Maven’s Gwen Preston, discusses how global currencies are in a race to the bottom as countries compete for trade, and central banks continue to cut interest rates. She points to the uncertainty facing investors today, and how, as a result they are seeking a safe haven’ which is likely to be gold.
According to Gwen, “Gold can perform and is performing already against the strong US Dollar. When gold performs against a strong US dollar, it is the mark of a real gold bull market. So I think that is something to grant a lot of confidence to gold moves so far.’
Bloomberg’s October commodity update also expect gold’s rally to long continue, predicting that it will beat other commodities and reach record highs.
“Gold will remain at the top of the precious metals leaderboard, and its performance [will] accelerate into year-end. A definitive reversal in weakening global economic conditions should be needed to reverse this trend, yet further woes in 4Q appear the greater risk,” writes Bloomberg Intelligence senior commodity strategist Mike McGlone.
Looking beyond this, Frank Holmes CEO at US Global Investors predicts that extremely dovish monetary policies around the world and economic conditions could propel gold prices much higher, possibly even reaching $10,000 oz over the long-term.
ECR a potential steal
Such long-term predictions will certainly please the ECR board. Should the remaining assays from their Creswick site prove positive, the company might well undergo a substantial upward re-rating.
Unlike many of its peers though, ECR mitigates risk across a broad and diverse spread of projects. Hopes and aspirations are high for the Windidda Gold Project, as well as their three additional sites in Victoria, all of which are under active exploration.
ECR CEO Craig Brown certainly believes the company is well undervalued. “If ECR was listed on the ASX our market cap would be 3-4 times higher” said Brown after a recent ShareTalk evening. Sat at just 0.77p I’d have to agree with him. Either way, ECR’s story is one to keep an eye on.
Harry Dacres-Dixon
References:
- Brand Communications – ECR Minerals #ECR – Australian Gold – Business Update
- The Motley Fool – Brexit it or not here’s why I’m keeping an eye on the gold market
- Gwen Preston – The Fundamentals for Gold & Gold Stocks are Outstanding
- Kitco – Gold prices to follow palladium to record highs – Bloomberg Intelligence
- Share Talk – Craig Brown Snapshots
Financial Times – UK Small-Cap Miners Hold Promise for Investors
Article by the Financial Times
ECR Minerals Craig Brown, chief executive of ECR Minerals, insists he is “not a goldbug, not fixated on gold”.
Nonetheless, ECR’s main business is exploring for gold deposits and it is planning mines in the Australian states of Victoria and Western Australia.
Mr Brown said gold mining is commercially appealing because the purification process is simple and the metal is a durable store of value.
ECR’s sites are still in the early stages of proving viability and are years away from commercial operation. In Victoria, the company is testing mineral samples for gold content to determine the extent and purity of deposits.
Mr Brown described the Western Australia project as “relatively greenfield, we’re not even talking about resources yet, we’ve got to drill some holes first”.
He maintains that ECR’s above-ground surveys give the company good reason to think that gold may be below.
Gold prices have risen by about 15 per cent over the year to $48 a gramme as investors have sought refuge from market turbulence.
ECR is listed on Aim and its shares currently trade at 0.7p. The price rose sharply in March and April after a series of positive findings from drilling in Victoria, but it has dropped back again and is currently down 7 per cent since January. Its market capitalisation is £3.2m.
ECR Minerals CEO Craig Brown & NED Sam Garrett outline the strength of ECR’s gold project portfolio in Australia at the Share Talk presentation evening
ECR CEO Craig Brown & NED Sam Garrett outlined the strength in depth of the Gold project portfolio in Australia at the @Share_Talk presentation evening to new investors in London
CEO Craig Brown & NED Sam Garrett #ECR outlined the strength in depth of the #Gold project portfolio in #Australia at the @Share_Talk presentation evening held in #London @ecrminerals Corporate Presentation, sharing the company overview – the story with new investors. pic.twitter.com/kjQNOget5w
— Share_Talk (@Share_Talk) April 1, 2019
ECR Minerals #ECR – New ECR Corporate and SLM presentations
ECR Minerals plc (LON:ECR), the precious metals exploration and development company, is pleased to provide a communications update for shareholders.
ECR has published a new corporate presentation on its website, which may be viewed at the following link:
In addition, reflecting interest in the Sierra de las Minas gold project in La Rioja, Argentina, ECR has prepared a project specific presentation in both English and Chinese and this may be viewed on the Company’s website at the following link:
FOR FURTHER INFORMATION, PLEASE CONTACT:
| ECR Minerals plc | Tel: +44 (0)20 7929 1010 | |
| David Tang, Non-Executive Chairman | ||
| Craig Brown, Director & CEO | ||
| Email:info@ecrminerals.com | ||
| Website: www.ecrminerals.com | ||
| WH Ireland Ltd | Tel: +44 (0)161 832 2174 | |
| Nominated Adviser | ||
| Katy Mitchell/James Sinclair-Ford | ||
| SI Capital Ltd | Tel: +44 (0)1483 413500 | |
| Broker | ||
| Nick Emerson |
ABOUT ECR MINERALS PLC
ECR is a mineral exploration and development company. ECR’s wholly owned Australian subsidiary Mercator Gold Australia has 100% ownership of the Avoca, Bailieston, Creswick, Moormbool and Timor gold exploration licences in central Victoria, Australia.
ECR has earned a 25% interest in the Danglay epithermal gold project, an advanced exploration project located in a prolific gold and copper mining district in the north of the Philippines. An NI43-101 technical report was completed in respect of the Danglay project in December 2015 and is available for download from ECR’s website.
ECR’s wholly owned Argentine subsidiary Ochre Mining has 100% ownership of the SLM gold project in La Rioja, Argentina. Exploration at SLM has focused on identifying small tonnage mesothermal gold deposits which may be suitable for relatively near-term production.