Power Metal - Arizona USA - Alamo Project Opportunity
· The Alamo project is a package of mining claims covering an area of approximately 340 acres and is situated in west-central
· The geological environment supports further exploration to investigate the source of the nugget gold and the potential for a large mineralised gold system.
· In addition, the region in which the Project is situated is prospective for precious and base metals, with regional mines that have produced silver, lead, gold, zinc and copper.
· POW has signed an agreement providing an opportunity to acquire a Right to Earn In ("RTEI") to a 60% interest in the
· Vendors include
As a Company we have remained open to the review of new additional opportunities and stated we may move ahead with compelling projects, including new jurisdictions outside
We have conducted a comprehensive review of opportunities that will complement the Company's mandate of securing interests that offer considerable upside potential through the implementation of disciplined programmes of exploration.
The Project has a rich story and one in which we are excited to have the opportunity to play a part. We will provide further information to market as we proceed through the site visit and due diligence processes in the near term.
The Project opportunity appears compelling in itself and will be made more so with
The Company issued an announcement on
In that update POW stated its key strategic objective as being to make large scale metal discoveries in
THE ALAMO PROJECT
The native gold nuggets at the Project occur in shallow arroyos (a steep-sided gully formed by the action of fast-flowing water in an arid or semi-arid region) and on hill-side occurrences. The arroyos are generally shallow depressions with sediment fill of up to one metre.
We understand that circa 60 ounces of gold Nuggets have already been found on the project area, by prospectors using metal detectors, with the largest Nugget weighing in at 5 ounces.
Nuggets have been obtained from the arroyo sediments by metal detecting and by small-scale dry washer mining methods. The composition of the nuggets is of particular geological interest in that both smooth/rounded and crystalline nuggets have been recovered, which suggests some difference in the distance of travel from their bedrock source (rounded nuggets having typically travelled some distance whereas the source of crystalline nuggets would be more proximal) pointing to potential scale and further prospectivity.
There is much debate in geological literature regarding nugget formation and there is work to undertake on the ground in
Some of this initial work will be undertaken during the due diligence period of 45 days (as described below) and some will naturally take a longer period of investigation should the Company decide to exercise the right to earn-in to the
VENDORS AND FORMATION OF SPECIAL ADVISORY COMMITTEE
The right to earnin to the
Subject to successful completion of project due diligence and POW exercising the right to earn in to the
The respective experience of the Vendors in both operating and developing mining projects through all phases of the development curve, as outlined below, will prove valuable when assessing how best to augment value in the
The Project is currently 100% owned by
The Vendors currently hold an option for a right to earn in to 60% of the Project by covering property payments over a four-year period and exploration expenditure over a three year period, (the "Option") as outlined below. POW has signed an agreement to acquire the Option, subject to the satisfactory completion of due diligence.
· POW has entered into a 45-day due diligence period to enable Project inspection and an initial work programme including Nugget verification and geochemical sampling to validate Project prospectivity (the "Due Diligence Period"). The fee payable to the Vendors to enter into the Due Diligence Period is
· The Due Diligence Period may be extended by a further 30 days through the payment of a further
· The Due Diligence Shares and Additional Due Diligence Shares are subject to a period of 4 months, where they may not be sold without the written approval of the Company. Should POW shares trade at a volume weighted average price ("VWAP") of 1.5p or more for seven consecutive trading days, or should POW decide not to acquire the Vendors' Option, the Due Diligence Shares and Additional Due Diligence Shares would become freely tradable.
· To acquire the Option from the Vendors, on satisfactory completion of due diligence, POW would pay the Vendors a further
· The Consideration Shares shall also be subject to a period of four months where they may not be sold without the express written approval of the Company. Should POW shares trade at a VWAP of 1.5p or more for seven consecutive trading days, the Consideration Shares would become freely tradable.
· Upon acquiring the Vendors' Option POW will be the operator of the Project, working in conjunction with a newly appointed advisory committee including
· Upon acquiring the Vendors' Option and establishment of the advisory committee POW will award share options over 2,500,000 New Ordinary Shares to
· After acquiring the Vendors' Option, POW can earn into a 60% interest in the
· Upon completion of the earn into the Project, POW must contribute to 60% of ongoing Project expenditure to maintain its 60% interest. Likewise, following the POW earn in,
ADMISSION AND TOTAL VOTING RIGHTS
Application will be made for the admission to trading of the Due Diligence Shares which is expected to occur on or around
This number will represent the total voting rights in the Company, and following Admission, 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
The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No.596/2014 and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.
For further information please visit https://www.powermetalresources.com/ or contact:
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+44 (0) 7766 465 617
SP Angel Corporate Finance (Nomad and Joint Broker)
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+44 (0) 20 3470 0470
Notes to Editors:
This information is provided by RNS, the news service of the
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