Power Metal Resources’ (LSE:POW) strong newsflow run continued on Wednesday when it announced that eight “compelling” drill targets had been established at the Botswana-based project into which it is earning.
The firm said Kalahari Key, the current owner of the Molopo Farms Complex (“MFC”) asset, followed up 11 conductor targets generated from airborne surveys last year with ground-based geophysics and modelling. The work not only recommended detailed drilling parameters and drill testing priorities for eight targets, but indicated that at least six of the highly-conductive bodies have the potential to be massive nickel sulphides.
The MFC project consists of many licences covering thousands of square kilometres in southern Botswana and is being targeted by Kalahari Key for prospective massive sulphide mineralisation. Power Metal has an 18.6% shareholding in Kahari Key and has elected to earn in to a 40% direct interest in the asset by way of spending $500,000 on exploration and target drilling this year. When this completes, the organisation will have an effective economic interest in the property of 50.96%.
Paul Johnson, Power Metal’s chief executive officer, said the presence of eight targets far outstrips both his own firm’s and Kalahari Key’s expectations for the MFC project.
"Back in May 2019 when POW entered the transaction the expectation of the Kalahari Key team was to identify 2 or 3 key targets from the ground geophysics work. Instead we now have 8 high profile drill targets which is a considerable uplift,” he said. “Kalahari Key have always stated their main strategic objective was to target nickel-PGM-bearing massive sulphide deposits similar to the Voisey's Bay nickel deposit. As POW's key strategic objective is to make a large-scale metal discovery our interests are aligned and now we find ourselves in an interesting position.”
Elsewhere on Wednesday, Power Metal said that an environmental plan for the proposed drilling programme at MFC has been completed with favourable results and has been submitted to Botswana’s government. Power Metal also said that third-party interest in the asset has continued, with Kalahari Key continuing to “engage with interested parties”. Meanwhile, the firm said Johnson has joined Kalahari Key’s board and an operational committee has been formed between the MFC partners following Power Metal’s decision to exercise its project option in December.
Johnson added that, following recent progress, he believes that Power Metal and its shareholders are “perfectly poised” in Botswana, adding:
“Subject to local approvals we have the high-profile drill targets, and the cash at bank to instigate a drill programme asap. Local liaison with drill contractors continues and measures are being implemented that will allow commencement of drilling at the earliest opportunity.”
Wednesday’s update comes just one day after Power Metal confirmed the presence of gold nuggets at its newly-acquired Alamo asset in Arizona, USA.
Author: Daniel Flynn
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