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#POW Power Metal Resources PLC – Commercial Update
Power Metal Resources PLC (LON:POW), the London listed exploration company seeking large-scale metal discoveries across its global project portfolio announces a commercial update providing the latest position in respect of various corporate activities recently completed or underway.
Paul Johnson, Chief Executive Officer of Power Metal Resources PLC commented:
“I am a resolute believer in the junior resource sector and its ability to deliver considerable returns for investors. The sector is, ultimately, driven by cyclicity caused by shifting supply and demand fundamentals for the underlying metals.
Over the past 4 years, Power Metal has assembled a unique and diverse global project portfolio which is ready for what I believe will be a longstanding and robust bull market for junior resource companies.
After a long-sustained bear market for resource juniors, I believe that the sector recovery has now begun as demonstrated by rising metal prices and the evident growing demand for metals in most industrial settings and for investment security.
In the last 6 months we have seen the IPO of Power Metal investee company First Class Metals PLC and completion of the Kanye Resources disposal to Kavango Resources PLC. These two transactions alone brought additional listed securities into the Power Metal portfolio that are together currently worth c.£4.1m (at the mid-market price on 21.12.22 market close).
Below you will see a further five transactions which each have the potential to add considerably to the Power Metal balance sheet. This corporate activity will complement our ongoing and successful exploration work at the Molopo Farms Complex and Tati Gold projects both located in Botswana and our Athabasca Basin uranium interests in Canada.
I would like to thank our professional teams for working so diligently on multiple complex transactions and positioning us where we are today. I also want to thank our shareholders who have stayed with us, through this challenging part of the cycle, patiently supporting us while we continue to push the business forward in advance of the next bull market.
We approach the Christmas and New Year break with a heightened sense of excitement and optimism for 2023 and beyond.”
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Company/Operations |
POW % |
Status |
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First Class Metals PLC (LON:FCM) Exploration in the Schreiber-Hemlo region of Ontario, Canada. |
27.91% |
Following the disposal of Power Metal’s Schreiber-Hemlo interests to FCM in September 2021, FCM successfully secured admission to the Official List (by way of a Standard Listing under Chapter 14 of the Listing Rules), on 29 July 2022. Power Metal holds a total of 18,516,097 FCM shares, which are subject to a hard lock-in agreement until 29 July 2023, with a further 12-month orderly market arrangement thereafter. The Company also holds 517,705 warrants to acquire new FCM ordinary shares at a price of 10p and with an expiry date of 29 July 2023. At the closing market mid-price of 17p on 21 December 2022 the value of Power Metal’s shareholding in FCM is £3,194,027. |
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Kavango Resources PLC (LON:KAV) Exploration in Botswana |
9.85% |
Following completion of the disposal of Power Metal’s interest in the Kanye Resources joint venture back to partner KAV, as announced in November 2022, Power Metal’s interests in KAV, which is also on the Official List of the London Stock Exchange, include: – 69,500,000 KAV ordinary shares. – Warrants to acquire 4,750,000 KAV ordinary shares at a price of 2.5p (expiry April 2023) – Warrants to acquire 30,000,000 KAV ordinary shares at a price of 4.25p (expiry January 2025) – Warrants to acquire 30,000,000 KAV ordinary shares at a price of 5.5p (expiry January 2025) In addition, Power Metal holds a 1% net smelter return (“NSR”) royalty across all Kanye Resources properties as at 8 July 2022. At the closing market mid-price of 1.5p on 21 December 2022 the value of Power Metal’s shareholding in KAV is £1,042,500. |
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Golden Metal Resources PLC (GMT) Exploration and development in Nevada, USA. |
83.13% |
During 2021, Power Metal acquired outright three projects located in Nevada, USA (Pilot Mountain, Garfield and Stonewall) and secured an option to acquire a 100% interest in a fourth project (Golconda Summit). The projects were acquired through GMT, then a wholly-owned subsidiary of Power Metal and a vehicle incorporated in advance of a planned listing in the London capital markets. A subsequent Pre-IPO financing for GMT raised £750,000 before expenses. Power Metal currently holds 49,874,437 GMT shares or 83.13% of GMT issued share capital. GMT has now completed the pre-IPO work required and a listing document has now been prepared (subject to final data additions) and the IPO financing is underway. A series of roadshow meetings have been undertaken with interested parties including institutions based in Canada and the UK and to date the GMT business model and listing proposal has been well received. These meetings will continue over the coming weeks and into the new year, allowing those with conflicts during the holidays to finalise their interest in the IPO early in the new year. GMT is looking to complete the IPO Financing and, subject to standard regulatory approvals, the final listing steps in early 2023. |
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First Development Resources PLC (FDR) Exploration in Western Australia and the Northern Territory of Australia. |
62.12%* |
During 2021. Power Metal acquired three exploration projects in Western Australia (Wallal, Braeside West and Ripon Hills), The projects were acquired through FDR, then a wholly-owned subsidiary of Power Metal and a vehicle incorporated in advance of a planned listing in the London capital markets. Subsequently, in 2021, FDR acquired an additional exploration project in the Northern Territory of Australia (Selta). Additional commercial transactions were undertaken by FDR in 2022 with the acquisition of a 100% interest in Pardoo Resources Pty Ltd (a project holding company) and the purchase of NSR royalties retained by the vendors of the vehicles holding the above projects. Power Metal currently holds 38,605,697 FDR shares or 62.12%* of FDR issued share capital. FDR is nearing completion of all the IPO work streams and is finalising the listing document in preparation for a planned IPO financing roadshow which is expected to commence in early 2023. |
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New Ballarat Gold PLC (NBGC) Exploration in the Victoria Goldfields of Australia. https://www.powermetalresources.com/project/victoria-goldfields/. |
49.9% |
In 2020 Power Metal established a joint venture with Red Rock Resources PLC (LON:RRR) focused on exploration projects in the Victoria Goldfields, Australia. The joint venture has secured a ground footprint in the Victoria Goldfields comprising 1,841km2 of granted licences and 493km2 of exploration licence applications awaiting grant. The footprint includes two former high-grade working gold mines (Ajax and Berringa), with Berringa currently the subject of an ongoing diamond drilling programme. A National Instrument 43-101 technical report has been prepared covering 7 of the licences, as an underlying document in preparation for listing of NBGC. The joint venture has a local operational team and is based out of Ballarat, Victoria. Across the footprint extensive evidence of historical gold workings exist, and outside of the footprint boundaries numerous positive exploration updates have been noted by fellow exploration companies. For example, we note recently the discovery of extensive gold mineralisation by Southern Cross Gold Ltd (a spin-out listing from Mawson Gold Ltd) included an intersection of 305.8m at 2.4g/t gold at their Sunday Creek project situated 5km east of the Kilmore project held by NBGC. Link here: https://wcsecure.weblink.com.au/pdf/SXG/02612149.pdf With the increasing confidence in the market and support for high-quality gold exploration investment opportunities, Power Metal is working with partner Red Rock Resources PLC to identify the best commercial structure and expeditious pathway to enable the planned listing to proceed. |
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NewCo Exploration in Queensland’s Mount Isa copper belt and in South Australia. NewCo to be incorporated shortly to allow the merger of three companies and their interests in South Australia and Queensland as per POW RNS 15.12.22). NewCo website under development. |
20%^ |
Power Metal announced on 15.11.22 the merger of its wholly owned Australian holding company which holds a 100% interest in the Wilan Project located in South Australia, with two other Australian exploration companies with 100% owned interests in the Mount Isa copper belt region of Queensland, Australia. The intention is to secure a planned new listing on a recognised stock exchange of the new merger company NewCo, comprising the South Australia and Queensland interests, or to dispose of the new merger company into a currently listed or to be listed vehicle. Work is underway now to consider all available options and updates will be provided to the market in due course. |
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Uranium Energy Exploration PLC (UEE) Uranium exploration in the Athabasca region of Canada |
50-55%~ |
Power Metal has agreed the disposal of two uranium properties to UEE subject to completion of a planned listing of UEE. Following discussions with UEE, Power Metal has agreed to extend the period for completion of the planned listing by 3 months to 31 March 2023. The intention is to list on a different exchange to that previously planned and to add further uranium projects to the UEE portfolio prior to the planned listing. As a result, UEE is now actively reviewing additional opportunities within the uranium space to bolster their portfolio in advance of the planned listing. The proposed business model (Uranium exploration focused on the Athabasca Basin area of Saskatchewan, Canada) has the support in principle of proposed investors in an IPO financing and would bring the first Athabasca focused investment proposition to the London capital markets. Further updates to follow as plans continue to advance. |
^ subject to completion of Merger announced 15.12.22.
~ subject to completion of disposal of Reitenbach and E-12 properties, announced on 8.8.22 and 4.11.22, respectively.
* reducing to 58.59% on issue of equity for NSR buyout announced 5.12.22
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 |
#ANA Ananda Developments – Shareholder Update
Ananda’s ambition is to be a leading UK grower and provider of high quality, consistent, carbon zero medical cannabis for the UK and international markets.
The Directors of Ananda provide the following update to shareholders.
Research programme
In early February 2022, 5 seeds of each of 13 strains of cannabis were planted at the DJT Plants Limited (“DJT”) medical cannabis research facility. Since then, the DJT team has been undertaking the following activities:
- The cannabis plants have been monitored daily, water requirements and nutrient requirements have been logged, and notes regarding the growth performance of each plant has been recorded.
- Pruning has been undertaken to encourage the even growth of a larger number of branches of each plant.
- Continued drafting of relevant Standard Operating Procedures (SOPs) to ensure best practice.
The seeds planted comprise a range of high THC / low CBD strains, low THC / high CBD strains and balanced strains. The precise cannabinoid and terpene profile of each strain will be ascertained when the plants are sent for analysis to Israel and UK based labs.
The next step to achieve stable strains of cannabis for potential commercial growing will be for 9 cuttings to be taken from each plant. These cuttings will be used for:
- Planting in the multi chapelles to start to assess the performance of the strains in DJT’s specialised growing conditions.
- Planting in the mother room so that there is a supply of mother plants which can then be compared with later generations of the same strain.
- The self-crossing programme in which some of the plants are forced to become males and then to pollinate the female plant from the same seed. This will increase the genetic stability of the next generation of plants.
There are a number of other parts to the research programme which are all designed to assist in the growing of stable strains of medical cannabis with cannabinoid and terpene profiles found to be beneficial in the treatment of a range of conditions. A further update on these initiatives will be provided in due course.
Commercial growing
As the research programme progresses, the team is now focused on developing its commercial plans. Commercial growing and selling is dependent on the successfully receipt of further licences from the Home Office and GMP (Good Manufacturing Practice) certification from the Medicines and Healthcare products Regulatory Agency (MHRA).
DJT Plants has retained a best-practice international GMP and pharmaceutical consulting firm with experience in designing GMP compliant medical cannabis facilities in jurisdictions with regulations similar to the UK. They will assist in the design of DJT’s cannabis manufacturing facility. As the UK is in the early years of its medical cannabis industry, it is the opinion of DJT’s management team that an internationally experienced consultancy is best placed to assist DJT. The conceptual manufacturing flowsheet has been created by DJT and activities will now proceed to the more rigorous planning and design processes to ensure optimum workflows, ease of access from the commercial growing areas and scalability. The proposed facility will operate to GMP and will be fully compliant under the MHRA guidelines.
Corporate
There remains one outstanding item to complete the Circular to shareholders for the purchase of the 50% of DJT not owned by Ananda. Once final sign off is obtained, the Circular will be posted to shareholders and the relevant General Meeting called.
-Ends-
The Directors of the Company accept responsibility for the contents of this announcement.
| ANANDA DEVELOPMENTS PLC Chief Executive Officer Melissa Sturgess Investor Relations |
+44 (0)7463 686 497 ir@anandadevelopments.com |
| PETERHOUSE CAPITAL LIMITED Corporate Finance Mark Anwyl Corporate Broking |
+44 (0)20 7469 0930 |
#ANA Ananda Developments – Shareholders Update
Ananda’s ambition is to be a leading UK grower and provider of consistent, high quality, carbon neutral medical cannabis for the UK and international markets.
The Directors of Ananda provide the following update to shareholders, which comprises Ananda’s responses to questions recently received from shareholders and other interested parties.
Melissa Sturgess, Ananda’s Chief Executive Officer, commented “We welcome these questions from shareholders and other interested parties. We believe that the medical cannabis industry is not particularly well understood at the moment, and we appreciate the time taken to frame these questions and send them to the Company”.
Q1: 40 Hectares of Land were identified by JE Piccaver & Co (Gedney Marsh) Limited (“JEPCO”) for commercial growing. Is this already owned and is it the intention to use the whole area for the first growing season?
A: JEPCO* originally delineated a 40Ha area for the use of DJT Plants Limited (“DJT Plants”). To comply with the Home Office’s desire for remote and secure locations to grow medical cannabis, a superior location was identified by JEPCO prior to DJT Plants submitting its application to the Home Office in October 2019. The location and significant acreage around it is leased by JEPCO. A sublease agreement between DJT Plants and JEPCO forms part of the acquisition package of the 50% of DJT Plants that is not already owned by Ananda. The initial area DJT Plants will be subletting covers 10Ha of land which also includes some infrastructure in the form of large storage sheds. The research facility is being built inside the storage sheds. Also included within the sublease agreement is the option to sublet more land from JEPCO as demand for product grows (subject to commercial licencing from the Home Office). The earmarked land is currently being utilised for crops, including potatoes and wheat and will be made available to DJT Plants when it is required. There is no reason for DJT Plants to tie up further land now for which it would have to pay rent. It is conceivable that the total area for cannabis growing could be bigger than 40ha but that will depend on success and demand.
In summary, Ananda is able to tailor the size of its growing area to the demand for product. To provide context, currently the UK market has around 10,000 patients who consume approximately 1 gram per day of cannabis. A reasonable assumption for yield would be 300-400g per square metre (3 – 4 million grams per hectare).
In line with other markets for medical cannabis, such as Israel and Germany, the Directors expect that the growth of the UK market will accelerate over the coming years. Ananda’s intention is to build capacity in line with market demand. Ananda believes that the best result for patients is to deliver high quality, consistent medical cannabis products and the best result for shareholders is to focus on building a profitable business for the long term rather than building large production capacity in the first year.
Note:
* DJT Plants is the holder of the Home Office licence to grow >0.2% THC cannabis for research purposes. DJT Plants is 100% owned by DJT Group Limited, which in turn is 50% owned by Ananda and 50% owned by Anglia Salads Limited. Anglia Salads Limited is owned as to 68% by JEPCO and Stuart Piccaver, JEPCO’s principal shareholder. Shareholders of Ananda will shortly be asked to approve the acquisition of the 50% of DJT Group Limited that Ananda does not own. Anglia Salads Limited will become a significant shareholder of Ananda.
Q2: What stage is Ananda at with identifying potential customers and establishing relationships with them?
A: Ananda’s initial focus is the UK and we have commenced engagement with patient groups, prescribing groups and associated health care workers. The Company has also commenced an initiative with the launch of the Medical Cannabis Research Roundup newsletters which comprise a regular summary of new scientific research in the medical cannabis space. These summaries are collated into a regular newsletter which the Company sends to interested parties. The Medical Cannabis Clinicians Society is to use Ananda’s updates to enhance its clinicians’ information database and will acknowledge Ananda’s contribution. If you would like to receive copies of the newsletters, please go to the Company’s website at www.anandadevelopments.com and sign up for the Medical Cannabis Research Roundup.
Q3: Is Ananda going down the same path as GW Pharmaceuticals Plc (“GW”) and becoming a pharmaceutical company?
A: No, Ananda is not a pharmaceutical company. The key difference between Ananda and GW is that GW formulates licensed medicines and Ananda is focused on unlicensed medicines, at least in the initial stages. Medical cannabis flower and oil (apart from the two GW products) currently prescribed in the UK are unlicensed. These unlicensed medicines are prescribed to patients by specialist clinicians.
Q4: When does Ananda anticipate starting and finishing the test growing phase?
A: The genetic stabilisation and field trial program, is expected to take around 18 months, provided there are no delays. It will commence when the research facility construction is complete. There are two parts to the first phase. The first is to create stable genetics by ‘self-crossing’ for a number of generations (pollinating with a plant of the same genetics). Genetic stability is most easily explained by thinking about the similarity of the plants you grow when you buy a bag of tomato seeds. It is currently difficult to obtain truly stable cannabis genetics without creating them yourself, and it is the Directors’ view that this is one of the causes of inconsistency of much medical cannabis flower. Inconsistent flower gives patients a different therapeutic experience from batch to batch, which is not ideal for the patient and does not generate confidence in the medicine for prescribing clinicians. The second part of the first phase is to take the best stable plants and grow them in the multi-chappelle greenhouses we have constructed at our research facility. This is crucial, as all genetics respond differently in different conditions and some or many might not grow at all well. We will take stable plants with the most ‘useful’ properties (combination of THC, CBD etc) and then find out which of those respond best to our growing conditions.
The Directors believe this will provide the best platform for the start of commercial growing (subject to licence) and enable the creation of a library of strains which will be proprietary to DJT Plants.
Q5: When will Ananda start its first production growing and first harvest?
A: It is not possible for the Directors to provide a time for this, because it depends on many factors, including Ananda’s ability to secure a number of licences and approvals, including a commercial growing licence from the Home Office, a manufacturing licence from the MHRA (including GMP certification of our manufacturing facility) and a few other minor licenses. Ananda is obviously focused on becoming a profitable company as quickly as possible and commercial growing is key to this.
Q6: What does Ananda intend to do to educate the medical profession regarding medical cannabis?
A: We have commenced the Medical Cannabis Research Roundup initiative as described above. In addition to our work, there are specialised groups focused on education, such as the Medical Cannabis Clinicians Society (www.ukmccs.org). That Society is currently training specialists in medical cannabis and providing education to other health care groups. Stuart Piccaver, Chief Executive Officer of JEPCO, and Melissa Sturgess presented to over 100 members of the Medical Cannabis Clinicians Society on 8 September 2021
Claims as to efficacy and healing properties cannot be made about unlicensed medicines. This is the case for all manufacturers of medical cannabis and all unlicenced medicines in the UK. We can only provide specialists with factual information, known as ‘detailing’. If the Company is able to commence commercial production, we intend to provide, amongst other things, certificates showing the CBD, THC, terpene etc content of the flower being prescribed and to show the full supply chain, so that prescribers can get comfort about UK quality and provenance.
Q7: There are reports that vegetable growers are struggling to obtain and retain resources for vegetable production. Is the growing of cannabis plant resource intensive, and does the Company envisage any issues in attracting the right resources to be able to grow the target volume of plants?
A: One of the reasons Ananda partnered with JEPCO is that they deal with human resourcing every year for their salad leaf business. To provide perspective, they have around 70 full time employees and we are able to draw on skills from that pool, on an as needs basis, as per the Service Agreement between DJT Plants and JEPCO. Stuart Piccaver has been dealing with the requirements for seasonal labour for many years and has developed a focus on automation where possible, in order to reduce labour requirements and human handling of high care plant material. One of the reasons for a managed expansion of the cannabis growing business, rather than immediate large scale, is to ensure we are able to manage labour requirements effectively and securely. All labour will have to be trained in cannabis growing, harvesting etc. We must also consider issues such as site security and numbers of people moving around high care areas.
Q8: How far down the supply chain is Ananda looking to serve or is the target to be a vertically integrated company?
We are focused on the UK initially, and this requires us to grow medical cannabis to GACP (Good Agricultural Collection Practices), manufacture it under MHRA certified GMP (Good Manufacturing Processes) and distribute under GDP (Good Distribution Practices). Initially, we propose producing flower-based products and will add extract products as the business grows. We do not want to take on aspects of the supply chain that we feel are not part of our remit (for example it is unlikely we will buy a specials pharmacy (pharmacy that handles unlicensed medicines)). We want to remain focused on growing and providing high quality medical cannabis to UK patients and build the business from that base.
-Ends-
The Directors of the Company accept responsibility for the contents of this announcement.
| ANANDA DEVELOPMENTS PLC Chief Executive Officer Melissa Sturgess Investor Relations |
+44 (0)7463 686 497 ir@anandadevelopments.com |
| PETERHOUSE CAPITAL LIMITED Corporate Finance Mark Anwyl Corporate Broking |
+44 (0)20 7469 0930 |