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Kavango Resources Plc (KAV) – KSZ Hukuntsi – TDEM conductor C1 identified
KSZ Hukuntsi – TDEM conductor C1 identified
Kavango Resources plc (LSE:KAV), the exploration company targeting the discovery of world-class mineral deposits in Botswana, is pleased to announce the identification of an electro-magnetic (EM) anomaly in Target Area C in the Hukuntsi (northern) section of the Company’s Kalahari Suture Zone (“KSZ”) Project.
Designated Target C1 (“C1”), the conductive anomaly is located 11km from Target A2 (“A2”), which was first announced on 20 April 2020.
C1 and A2 appear to lie within the same geological corridor. The Company now plans to drill a minimum of one hole in A2 and a minimum of one hole in C1. Drilling is to commence at the end of June.
Both A2 and C1 lie in ‘Norilsk-style’ gabbro keels. The primary objective of both holes is to recover drill core from the bottom of the keels for further analysis to test the system’s potential to host major metal sulphide deposits.
Highlights
- Target C1
- 11km NE of Target A2
- Kavango believes A2 and C1 lie in the same geological corridor of Karoo-age gabbro, which is open in both directions
- The conductor is 1,200m by 1,600m and sits at the bottom of a keel as defined by the Company’s 3D Geological Model
- 530m depth from surface to centre of the conductor
- The decay constant is ~360msec
- Conductance of 2,500 Siemens
- Drill plan:
- Drill operator is Mindea Exploration and Drilling Services (Pty) (“Mindea”)
- Mindea to set up camp between Targets A2 & C1
- Drilling at A2 to commence in June
- Drilling to commence at C1 in July
- Kavango to pay <half the total drill cost to Mindea in cash (c.£70,000), with remaining fees payable in shares
- Potential to increase scope of drilling, once rig is on site and pending further data analysis
- Extensive assaying and downhole geophysics planned on all boreholes
Michael Foster, Chief Executive Officer of Kavango Resources, commented:
“The ‘Norilsk Model’ for metal sulphide systems suggests deposits originally formed in clusters. In this context, it is encouraging that C1 is located relatively close to A2. We believe both targets lie potentially within the same geological corridor of Karoo gabbro.
If drilling validates our interpretation of the data, this could prove to be a significant development in our attempts to unlock the Kalahari Suture Zone.
The fact that C1 shares a number of highly similar characteristics with A2 is very encouraging. Like A2, C1 is in an ideal geological setting (at the bottom of a “keel”), is nearly 2km2 in size, has a conductance of 2,500 Siemens and a decay constant of ~360msec.
We look forward to retrieving core from both targets in the coming months.”
Background
Over the last three years, Kavango has conducted extensive geophysical surveys over Karoo-age gabbros at Hukuntsi using airborne and ground-based based technology. In 2019 Kavango completed a successful orientation drill programme, data from which helped augment the Company’s extensive 3D Magnetic Model of the region’s subsurface geology (announced 8 September 2020).
On 30 November 2020 Kavango released results from its analysis of the 3D Magnetic Model, which revealed close similarities between the gabbroic rock formations in the KSZ and those at the Norilsk mining centre, in northern Russia.
In December that year, the Company initiated the first ground-based Time Domain Electromagnetic (TDEM) survey of the KSZ. This was the first time this powerful remote sensing technology had been used on the KSZ. Kavango subsequently secured a strategic partnership with the TDEM operator, Spectral Geophysics Ltd, to accelerate and broaden the TDEM programme.
On 20 April 2021 and 5 May 2021, Kavango released details of the results from the second TDEM survey, which defined Target A2.
On 10 June 2021, Kavango announced plans to drill two holes in the KSZ. The drill contractor is Mindea Exploration and Drilling Services (Pty), who has agreed to receive >half its fees in equity from Kavango.
Links to the relevant announcements are provided below:
- 8 September 2020 – https://www.investegate.co.uk/kavango-resources–kav-/rns/3d-model-confirms-ksz-norilsk-rock-formations/202009080700072794Y/
- 30 November 2020 – https://www.investegate.co.uk/kavango-resources–kav-/rns/4-norilsk-style-target-areas-selected-in-the-ksz/202011300700068179G/
- 20 April 2021 – https://www.investegate.co.uk/kavango-resources–kav-/rns/ksz-hukuntsi—tdem-conductor-identified/202104200700039575V/ & https://www.investegate.co.uk/kavango-resources–kav-/rns/strategic-partnership-with-spectral-geophysics/202104200705019579V/
- 5 May 2021 – https://www.investegate.co.uk/kavango-resources–kav-/rns/ksz-tdem-update-and-warrant-exercise/202105051000016206X/
- 10 June 2021 – https://www.investegate.co.uk/kavango-resources–kav-/rns/ksz-hukuntsi—drilling-to-commence-in-june/202106100700094047B/
About Target A2
Kavango estimates Target A2’s properties are:
– 1km length, which is open along strike
– Extends between 250m to 700m below surface and is gently dipping
– Decay constant of approximately 340msec and conductance of approximately 3000 Siemens, readings which Kavango management considers are consistent with nickel sulphide deposits elsewhere in the world
– Located in the right geological setting, at the bottom of a “keel” in the gabbroic intrusion, according to the Company’s Magnetic 3D-Model (8 September 2020)
About Target C1
Kavango estimates Target C1’s properties are:
– 1,200m by 1,600m in size
– 530m depth to centre of the conductor
– Decay constant of approximately 360msec and conductance of approximately 2,500 Siemens
– Located in the right geological setting, at the bottom of a “keel” in the gabbroic intrusion, 11km away from A2 (potentially in the same geological corridor of Karoo-gabbro)
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Further information in respect of the Company and its business interests is provided on the Company’s website at www.kavangoresources.com and on Twitter at #KAV.
For additional information please contact:
Kavango Resources plc
Ben Turney
First Equity (Joint Broker)
+44 207 374 2212
Jason Robertson
SI Capital Limited (Joint Broker)
+44 1483 413500
Nick Emerson
Kavango Resources (KAV): KSZ Hukuntsi – Drilling to commence in June
KSZ Hukuntsi -Drilling to commence in June
Kavango Resources plc (LSE:KAV), the exploration company targeting the discovery of world-class mineral deposits in Botswana, is pleased to announce drilling will commence on two “proof of concept” geological holes in the northern (Hukuntsi) section of the Kalahari Suture Zone (“KSZ”) in June.
Kavango’s primary objective is to become the first company ever to retrieve drill core from the bottom of the “keels” of the Karoo-age gabbros in the KSZ. The Company anticipates that drill-core from these holes will provide firm physical evidence of the KSZ’s potential to host ‘Norilsk-style’ metal sulphide deposits.
To this end, Kavango has awarded a contract to Mindea Exploration and Drilling Services (Pty) (“Mindea”), a company operated under the Botswana Citizen Economic Empowerment Policy, to design, engineer and drill a minimum of two 500m boreholes (the “Drill Contract”). Drilling is planned to commence by no later than 30 June 2021.
Mindea has agreed to accept payment for the Drill Contract half in cash and half in Kavango stock (at an issue price of 4.53p per share).
Highlights
- Drill contract key terms:
- Mindea to drill a minimum of two 500m “geological” diamond holes at Hukuntsi
- Cost per metre calculated on possible depth per hole of 800m
- Mindea to design and engineer all bore holes
- All bore-holes to be cased from surface into the gabbro intrusive to allow for extensive testing and geophysical surveying
- Bore-holes will be oriented -80° from the horizontal
- Core samples (HQ and NQ size) to be recovered for geological logging, whole rock geochemistry and assaying.
- Key safety protocols and COVID-security processes agreed
- Mindea to accept over half its fee in equity in Kavango, to be paid through the issue of shares in the Company at an agreed price of 4.53p per share
- Drill targets:
- Final drill collar locations to be confirmed later this month
- A minimum of one hole to be drilled into Target A2 (announced on 20 April 2020)
- Analysis of other potential drill targets ongoing, with results expected shortly
- Planned testing programme on all boreholes:
- Downhole electromagnetic (“EM”) surveys to be performed by Spectral Geophysics, with an anticipated search radius of 300m-400m from the drill string
- XRF testing of sand cores to be completed by Kavango’s exploration team.
- Core for assay and petrological work will be split by Kavango staff in Hukuntsi
- Whole rock geochemistry and assay testing of core samples to be completed at the SGS laboratory in South Africa
- Additional analysis of geochemistry and petrological/mineralogical studies to be performed in the UK by academic consultants.
- Site preparation:
- Site visits completed, camp location agreed and two water sources identified
- The Company has engaged with the local community to secure its support
- Drill rig mobilisation expected within the next week
- Ongoing discussions with Equity Drilling Ltd (a 49% shareholder in Mindea) concerning a future potential strategic partnership
- Budget in place for more extensive drilling campaign later in 2021
Michael Foster, Chief Executive Officer of Kavango Resources, commented:
“The Kalahari Suture Zone was first identified 45 years ago. The technical challenges of pursuing exploration under 70m of Kalahari sands and sediments proved too much for previous companies that attempted to unlock this region’s significant potential.
Through the deployment of modern remote sensing technologies, sophisticated data analysis and persistent hard work, Kavango now aims to become the first company to retrieve drill core samples from the bottom of the “keels” of the Karoo-age gabbros here.
If we are successful this will be a major achievement for the Company.
We believe core samples from the bottom of the gabbroic “keels” could provide us with the definitive proof we have been looking for that the KSZ could host one or more major deposits of nickel, copper and platinum group metals.
I am particularly delighted to be working with Mindea Exploration and Drilling Services on such an important project. Mindea is a well-established national drilling contractor in Botswana, having worked for Debswana and DeBeers. Equity Drilling, one of Mindea’s largest shareholders, also operates a highly regarded drill school in Gaborone, the first of its kind in Africa.
Kavango is committed to investing heavily in Botswana. Working with such reliable local partners as Mindea and Equity Drilling is integral to our ambitious growth strategy.
The fact that Mindea has agreed to receive over half of its fees in equity suggests considerable faith in the potential of the KSZ to host metal sulphide ore bodies and a great endorsement of Kavango’s exploration approach. For a minimal cash outlay, we can make significant advances with the KSZ Project, while keeping a budget in reserve for a more extensive drill campaign later this year.”
Background
Over the last three years, Kavango has conducted extensive geophysical surveys over Karoo-age gabbros at Hukuntsi using airborne and ground-based based technology. In 2019 Kavango completed a successful orientation drill programme, data from which helped augment the Company’s extensive 3D Magnetic Model of the region’s subsurface geology (announced 8 September 2020).
On 30 November 2020 Kavango released results from its analysis of the 3D Magnetic Model, which revealed close similarities between the gabbroic rock formations in the KSZ and those at the Norilsk mining centre, in northern Russia.
In December that year, the Company initiated the first ground-based Time Domain Electromagnetic (TDEM) survey of the KSZ. This was the first time this powerful remote sensing technology had been used on the KSZ.
On 20 April 2021 and 5 May 2021, Kavango released details of the results from the second TDEM survey, which defined Target A2.
Links to the relevant announcements are provided below:
Ø 08 September 2020 – https://www.investegate.co.uk/kavango-resources–kav-/rns/3d-model-confirms-ksz-norilsk-rock-formations/202009080700072794Y/
Ø 30 November 2020 – https://www.investegate.co.uk/kavango-resources–kav-/rns/4-norilsk-style-target-areas-selected-in-the-ksz/202011300700068179G/
Ø 20 April 2021 – https://www.investegate.co.uk/kavango-resources–kav-/rns/ksz-hukuntsi—tdem-conductor-identified/202104200700039575V/
Ø 05 May 2021 – https://www.investegate.co.uk/kavango-resources–kav-/rns/ksz-tdem-update-and-warrant-exercise/202105051000016206X/
The Company now proposes to drill at least one 500m borehole into Target A2, with a second hole also planned in the area. Final confirmation of specific drill collar locations will be confirmed in the coming weeks.
About Mindea
Mindea Exploration and Drilling Services (Pty) LTD was formed in September 2019 by Equity Drilling Limited and Maureen Mokgaotsane (Geologist), Sebanka Lobatlamang (Geologist) and Eddie Babuseng (Attorney at Law) to provide complete exploration solutions to its clients in Botswana.
Mindea is currently operated under the Botswana Citizen Economic Empowerment Policy and is owned 51% by local shareholders and 49% by Equity Drilling. Over the coming years it is expected that Botswana nationals will wholly own Mindea, with Equity Drilling continuing to provide strategic and technical support.
Mindea operates to strict international safety standards and deploys the latest equipment to its projects. Mindea is rigorous in its planning and site preparation.
Reflecting the quality of its operations, Mindea has recently been awarded a 3-year contract by Debswana to drill various national projects in Botswana. In addition to this, Mindea is a regular drill contractor for DeBeers.
About Equity Drilling
The owners of Equity Drilling are extremely experienced drill operators, with extensive experience of successfully working on technically challenging projects across Africa.
Equity Drilling established Africa’s first Drilling School in Botswana, the Africa Mining and Drilling Institute (“AMDI “)
AMDI is Botswana Qualifications Authority (BQA) certified, which offers internationally recognised certification to all students wishing to be taught exploration drilling. AMDI has an exclusive working relationship agreement in place with the Australian Drilling Industry Association (the “ADIA”) and offer the ADIA’s DICAT curriculum with a strong emphasis on safety in the workplace.
AMDI also offers funds the delivery of pre-industry courses to students from local communities, who have had no previous work experience. This course prepares students for the work place and making them eligible for placement into the industry on graduation. Mindea’s own labour resources have been drawn from these pre-industry course graduates
About Target A2
Kavango estimates Target A2’s properties are:
– 1km length, which is open along strike
– Extends between 250m to 700m below surface and is gently dipping
– Decay constant of approximately 340msec and conductance of approximately 3000 Siemens, readings which Kavango management considers are consistent with nickel sulphide deposits elsewhere in the world
– Located in the right geological setting, at the bottom of a “keel” in the gabbroic intrusion, according to the Company’s Magnetic 3D-Model (8 September 2020)
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Further information in respect of the Company and its business interests is provided on the Company’s website at www.kavangoresources.com and on Twitter at #KAV.
For additional information please contact:
Kavango Resources plc
Ben Turney
First Equity (Joint Broker)
+44 207 374 2212
Jason Robertson
SI Capital Limited (Joint Broker)
+44 1483 413500
Nick Emerson
Kavango Resources Plc (KAV) – Kalahari Copper Belt update: Copper and Silver targets identified on LVR JV
KCB update: Cu/Ag targets identified on the LVR JV
Kavango Resources plc (LSE:KAV), the exploration company targeting the discovery of world-class mineral deposits in Botswana, is pleased to announce that extensive copper/silver targets (the “Targets”) have been identified on Prospecting Licences (PLs) 082/2018 and 083/2018 in the Kalahari Copper Belt (KCB). The two PLs are held in a Joint Venture farm-in with LVR GeoExplorers Ltd (the “LVR Project”).
The Targets were detected as a result of the recent Airborne EM (AEM) surveys flown over the LVR Project. Strong soil geochemical anomalies occur at surface above the Targets.
Highlights
- 1,216km of Airborne Electromagnetic (AEM) surveys flown over the LVR Project in March
- Stage 1 of the LVR farm-in now complete, taking Kavango’s stake in the LVR Project to 25%
- PL 082/2018
- Identification of a series of conductors over a 3.5km wide deformation zone
- The conductors lie along strike of the Plutus deposit and the Boseto Mine to the north east
- The primary target is a large EM conductor, extending to at least 400m from the surface
- Strong coincidental copper (25ppm to >56ppm) and zinc (50ppm to >100ppm) in soils anomaly on surface
- Fault controlled soil geochemistry anomalies striking over 5km
- Distinct similarities with Cupric Canyon’s Banana Zone South Limb (mirror image) on the south side of the Ghanzi Ridge
- PL 083/2018,
- >10km of AEM conductors in the south-east of the PL, across two main targets (6km and 4km wide)
- Both targets have coincidental copper in soils anomaly over three lines (500m spacing) and the anomaly remains open
- The conductors are underlain by a linear magnetic anomaly extending for over 2km beneath the soil anomaly
- The structural position of the Targets is prospective for the discovery of copper/silver mineralisation
- PL 082/2018 is drill ready
- PL 083/2018 requires further field exploration to delineate drill targets
- Drilling expected in Q3, on award of Environmental Management Plan.
Michael Foster, Chief Executive Officer of Kavango Resources, commented:
“The Airborne EM surveys have produced compelling justification for Kavango’s strategy in the Kalahari Copper Belt. We are confident we have identified copper mineralised systems, which we now have to test through drilling.
The Company’s integrated exploration approach, combining soil geochemistry, stratigraphical and structural mapping together with geophysical surveying is proving to be highly effective. A program of trenching on PL082/2018 and additional soil geochemistry on PL083/2018 is planned prior to a drill program later in the year.”
Background
SkyTEM Ltd conducted the AEM surveys in February 2021, flying a total of 1,216 line/kms over the LVR Project.
The AEM surveys, flown together with airborne magnetic surveying, were carried out on lines 200m apart, on an approximately north-south orientation.
The survey blocks were selected by Kavango’s geophysical team, based upon analysis of magnetic data and soil geochemistry results obtained at the end of 2020 combined with the remote mapping of geological structures from the analysis of Landsat imagery.
The LVR JV
The LVR JV Agreement between Kavango and LVR GeoExplorers Ltd comprise two PLs totalling 1,091km2. Kavango has the right to acquire a 90% interest in the PLs through staged exploration expenditure commitments.
With completion of Stage 1 of the JV, Kavango has earned its first 25% interest in the two licences.
The plots of the AEM surveys and their interpretation will be posted on the Company’s website.
PL 082/2018
PL 082/2018 is 126km2 and lies along strike of the Plutus deposit and the Boseto Mine, owned by Cupric Canyon. This PL is characterised by steeply dipping repetitions of D’Kar and Ngwako Pan formations sitting above and either side of a basement dome.
The AEM survey has identified a series of EM conductors over 3.5km, which are coincident with a significant geochemical anomaly. Kavango has completed extensive soil sampling over this target area, including fifteen 4km sample lines that have returned copper readings in the range of 25ppm to >56ppm and zinc readings of 50ppm to >100ppm. Fault controlled soil geochemistry anomalies strike over 5km and merit immediate further investigation.
The conductors appear to be centred on an area of deformation and thrusting marked by a number of NNE trending faults commonly associated with economic mineralisation on the KCB.
The geological interpretation suggests an almost mirror image of the Banana Zone deposit (15km to the SE) that has been drilled out by Cupric Canyon on the southern side of the adjacent Ghanzi Ridge.
The main conductor lies just 1km from the main tarred road to Maun and a few hundred meters from a major power line. It is close to surface and extends to 400m depth. It represents an attractive drill target.
LVR PL 083/2018,
PL 083/2018 covers 965km2 and lies in the western part of the KCB in Botswana.
The AEM survey over this PL shows a series of thin formational conductors (possible redox boundaries) proceeding west for over 20km but, as they approach the eastern boundary of the PL, these conductors are intercepted by NNE faults and “blossom” into a large conductive body 6km wide (Target A), with another conductive body (Target B) 4km wide further to the north.
Kalahari sand cover is approximately 10m thick in this area, but soil geochemistry anomalies remain strong.
A well-defined copper in soil anomaly (>40ppm Cu), sitting above Target A, is defined over three sample lines 500m apart. The soil anomaly remains open.
A 2km magnetic anomaly is also coincident with both the AEM survey results and the soil anomalies.
Further exploration work is required on these two anomalies to identify their stratigraphical associations and depth. However, initial data suggests both have good potential for metal mineralisation.
Further information in respect of the Company and its business interests is provided on the Company’s website at www.kavangoresources.com and on Twitter at #KAV.
For further information please contact:
Kavango Resources plc
Ben Turney
First Equity (Joint Broker)
+44 207 374 2212
Jason Robertson
SI Capital Limited (Joint Broker)
+44 1483 413500
Nick Emerson
Kavango Resources #KAV – Final Results year ended 31 December 2020
Final Results – year ended 31 December 2020
Kavango Resources plc (LSE: KAV), the exploration group listed on the Standard List segment of the main market of the London Stock Exchange and targeting the discovery of world class mineral deposits in Botswana, announces its audited financial statements for the year ended 31 December 2020. The full report is available on the Company’s website at www.kavangoresources.com .
Key highlights:
- Total assets – US$ 6,845,768 (2019 – US$ 4,547,056)
- Loss – US$ 708,121 (2019 – US$ 1,472,049)
- Raised gross proceeds of £2,000,000
- The Group reports its results in US Dollars (USD). Its primary assets are in Botswana and are accounted for in Botswana Pula (BWP). Kavango Resources plc maintains its accounting records and raises funds in Pounds Sterling (GBP).
In accordance with Listing Rule 9.6.1 of the UK Financial Conduct Authority (“FCA”), a copy of the 2020 Annual Report will be submitted to the FCA via the National Storage Mechanism and will shortly be available to the public for inspection at:
ttps://www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism
For further information please contact:
Kavango Resources plc
Michael Foster
First Equity (Joint Broker)
+44 207 374 2212
Jason Robertson
SI Capital Limited (Joint Broker)
+44 1483 413500
Nick Emerson
Power Metal #POW – Option Agreement for Botswana Gold-Nickel Project
Option Agreement – Botswana Gold-Nickel Properties
Company has Signed an Option Agreement to Acquire a 100% Interest in Two Gold – Nickel Prospecting Licences in the Tati Greenstone Belt, Botswana, with a down payment on drilling.
Power Metal Resources PLC (LON:POW) the AIM listed metals exploration and development company is pleased to announce it has secured an option (the “Option”) to acquire two prospecting licences (“PLs”) prospective for gold and nickel and located upon the Tati Greenstone Belt, Botswana.
The Option allows for a 60 business day due diligence period, and should Power Metal exercise the Option, it will undertake the licence acquisitions through its newly formed 100% owned subsidiary Power Metal Resources Botswana (Pty) Limited (“Power Metal Botswana”).
Paul Johnson, Chief Executive Officer of Power Metal Resources, commented:
“We recently formed Power Metal Botswana to provide a holding company for new acquisitions in Botswana and I am pleased to announce this first transaction. Subject to due diligence, this acquisition would give the Company exposure to a new strategic project in the heart of the Tati Greenstone Belt, an under explored area which we believe holds considerable potential for new gold and nickel discoveries.
This announcement further confirms the Company’s commitment to expanding our operational interests in Botswana, which is a first class destination for responsible exploration companies. Uniquely, the transaction incorporates an Option fee that is convertible into a down payment against project drilling in Botswana.
I look forward to providing further information as our due diligence work progresses.”
Vendor and Prospecting Licence Information
Vital Commodities Pty Ltd, a company registered and Incorporated in Botswana (“VC”) VC is a private Botswana company that owns two prospecting licences in Botswana, (the “Vendors”). VC is 100% owned by Equity Drilling Limited, a company registered and incorporated in Guernsey.
The PLs owned by the Vendors and the subject of this transaction are as follows:
PL127/2019
PL127/2019 is located near the southern extent of the north-northwest striking Tati Greenstone Belt, roughly 40km southwest of Francistown, Botswana, and less than 7km from the Mupane underground gold mine.
PL127/2019 covers a total area of 89km2 and is prospective for orogenic gold and intrusive magmatic nickel mineralisation.
Several untested kilometre-scale Arsenic (‘As’)- and Gold (‘Au’)-in-soil anomalies extend onto PL127/2019 from the northeast and southeast.
The licence is also believed to cover the southern extent of prolific gabbroic-troctolitic intrusions which host the Phoenix, Selkirk and Tekwane Ni-Cu-PGE rich deposits located along the periphery of the Tati Greenstone Belt less than 7km from the licence. The magmatic Ni-Cu-PGE potential the licence possesses has been generally overlooked by previous operators.
PL126/2019
PL126/2019 is located near the northern extent of the Tati Greenstone Belt, less than 10km southeast of Francistown and is adjacent to the Golden Eagle deposit (Shashe Mining Licence).
PL126/2019 covers a total area of 35km2 and is prospective for orogenic gold mineralisation. The licence hosts several untested arsenic and gold in-soil anomalies as well as a large historic mine dump which has received little known follow up or modern exploration.
Tati-Greenstone Belt Information
The Tati Greenstone Belt (“TGB”) is located in the vicinity of Francistown, adjacent to the Zimbabwe border, in north-eastern Botswana. With a total strike length of 65km and up to 20km in width the TGB hosts a large number of orogenic style gold deposits and several economically significant intrusive magmatic Nickel-Copper-Platinum Group Elements (“Ni-Cu-PGE”) rich sulphide deposits.
A gold rush started at Tati in 1867 leading to the establishment of Francistown and over 70 reported small scale gold mining operations.
The TGB is Botswana’s only gold producing region with the Mupane gold mine (held by Galane Gold Ltd) being the country’s only major gold producer. Mupane was formerly an open-pit operation and is now an underground mine. It is located in the southern part of the TGB.
The known nickel deposits on the greenstone belt consist almost entirely of disseminated to semi massive sulphide bodies hosted by a series of late stage gabbroic-troctolitic intrusive bodies. Significant nickel operations which operated until 2016, included the former Tati Nickel Mining’s Selkirk underground mine which commenced production in 1989 and the Phoenix open pit which started in in 1995. Both deposits are located in the south-central portion of the TGB.
Geologically the TGB is part of the Francistown Arc Complex within the southern margin of the Archean age Zimbabwe Craton in the northern contact zone of the Limpopo Belt. The principal lithologies of the TGB are lower greenschist to lower amphibolite facies volcanic and sedimentary rocks, constrained by three fault-bounded volcano-plutonic sequences which are intruded by granitoids.
Whilst there is a long history of small scale gold mining on the TGB, the Company believe it to be underexplored by modern standards and systematic exploration focussing on areas with sand cover and geophysics targeting greater depths, are likely to yield further gold and nickel discoveries.
Option Agreement Information
The Option:
- Power Metal has signed an option agreement to acquire a 100% interest in PL 126/2019 and PL 127/2019, being two granted prospecting licences in Botswana within the Tati Greenstone Belt and held by the Vendors.
- The Option provides a 60 business-day period, during which Power Metal may undertake due diligence and notify the Vendors of Option exercise to acquire 100% of P L 126/2019 and PL 127/2019 from the owner of the said prospecting licences.
- The Option fee is to be satisfied through a cash payment of £50,000 to the Vendors. The full amount of £50,000 paid may be credited and offset from the cost of the drilling u ndertaken by Equity Drilling Limited (100% owner of VC) at the two PLs which are the subject of this Option or at other Power Metal interests in Botswana. The payment will be made using existing Power Metal cash resources.
Upon Option Exercise:
- VC will subject, to local authority approvals, arrange immediate transfer PL 126/2019 and PL 127/2019 into Power Metal Botswana.
- The consideration items outlined below, following Option exercise, will not become due and payable until the necessary local authority approvals for the transfer to Power Metal Botswana have been received and the transfer completed.
- Should Power Metal at its sole volition exercise the Option for the acquisition of PL 126/2019 and PL 127/2019, the Company will pay an initial consideration of £25,000, payable through the issue to the Vendors of 833,333 new ordinary Shares of 0.1p each in the Company (“New Ordinary Shares”) at an issue price of 3.0 pence per New Ordinary Share (“Initial Exercise Shares”).
- Thereafter should Power Metal elect to proceed with the year 3 exploration spend programme (for the year ending 30 September 2022) it will pay a further consideration of £50,000, payable to the Vendors through the issue of 833,333 New Ordinary Shares at an issue price of 3.0p each for each licence where such spending is confirmed, thereby if both confirmed then 1,666,666 New Ordinary Shares would be issued (the “Further Exercise Shares”).
- In addition, Power Metal will pay a single further consideration payment of £100,000 through the issue the Vendors of 3,333,333 New Ordinary Shares at an issue price of 3.0p (“Final Exercise Shares”) if either of the two following conditions are met:
– (1) Confirmation of a 250,000 oz JORC (2012) compliant gold Mineral Resource across the two prospecting licences
– (2) Confirmation of a 5,000,000 tonne economic nickel deposit at a grade of >1.5% nickel.
- Additionally, the Company shall issue to VC 5,833,332 warrants (the “Vendor Warrants”) in two separate tranches of 2,916,666 warrants each:
- 2,916,666 Vendor Warrants shall be issued to acquire New Ordinary Shares at an exercise price of 5p per share, exercisable over a 2-year period from today’s date and which are only exercisable on completion of drilling against which the £50,000 offset payment has been made and successful transfer of PLs 126/2019 and 127/2019 to Power Metal Botswana (the “5p Vendor Warrants”). The 5p Vendor Warrants shall be subject to a 5-day VWAP accelerator, by which should Power Metal shares trade above 10p for 5 trading days then the Company shall have the right to serve notice on VC that it must exercise and pay for the exercised 5p Vendor Warrants within 14 calendar days or the 5p Vendor Warrants shall be cancelled.
- 2,916,666 Vendor Warrants shall be issued to acquire New Ordinary Shares at an exercise price of 7.5p per share, exercisable over a 2-year period from today’s date and which are only exercisable on completion of drilling against which the £50,000 offset payment has been made and successful transfer of PLs 126/2019 and 127/2019 to Power Metal Botswana (the “7.5p Vendor Warrants”). The 7.5p Vendor Warrants shall be subject to a 5-day VWAP accelerator, by which should Power Metal shares trade above 15p for 5 trading days then the Company shall have the right to serve notice on VC that it must exercise and pay for the exercised 7.5p Vendor Warrants within 14 calendar days or the 7.5p Vendor Warrants shall be cancelled.
- Up to 30 September 2022 Power Metal will engage VC to quote for all drilling activities undertaken on PL 126/2019 and PL 127/2019.
- The Vendors and their professional licensing and geological teams will continue to work with Power Metal following Option exercise to manage licences and third party relationships, undertake ground exploration and to help where appropriate to further build the licence footprint in Botswana. Reasonable commercial terms will be agreed for any additional work undertaken.
Glossary:
Orogenic Gold (Deposits) – Gold deposits found within metamorphic belts which form as a result of major crustal deformation events.
Intrusive Magmatic Nickel (Deposits) – Nickel deposits found at the base of large mafic and ultramafic intrusive bodies.
Arsenic-in-soil anomaly – Geochemical anomaly defined by increased arsenic levels over background.
Gold-in-soil anomaly – Geochemical anomaly defined by increased gold levels over background.
PGE – Platinum group elements (ruthenium, rhodium, palladium, osmium, iridium, and platinum)
Gabbroic-troctolitic intrusives – Coarse grained, dark coloured, intrusive rocks composed mainly of pyroxene, plagioclase and minor amounts of amphibole and olivine.
Lower greenschist to amphibolite facies – Metamorphic rocks with increased chlorite, serpentine, and epidote (greenschist), or amphibole and plagioclase (amphibolite) which are indicative of a high degree of metamorphism caused my intense heat and pressure in the subsurface.
Granitoids – Coarse grained igneous rock composed mostly of quartz, alkali-feldspar and plagioclase.
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.
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:
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Power Metal Resources plc |
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Paul Johnson (Chief Executive Officer) |
+44 (0) 7766 465 617 |
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SP Angel Corporate Finance (Nomad and Joint Broker) |
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Ewan Leggat/Charlie Bouverat |
+44 (0) 20 3470 0470 |
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SI Capital Limited (Joint Broker) |
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Nick Emerson |
+44 (0) 1483 413 500 |
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First Equity Limited (Joint Broker) |
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David Cockbill/Jason Robertson |
+44 (0) 20 7330 1883 |