Power Metal Resources (LON: POW) has accelerated its earn-in for Silver Peak and agreed a stock exchange listing for the promising Canadian asset.
The metals exploration and development firm took the opportunity to snap up the rest of its optioned stake in the project after witnessing exciting levels of third-party interest in quality silver projects, and now holds a 30% position.
Alongside its partners, who hold the other 70% interest, Power Metals has agreed to list Silver Peak “on a recognised stock exchange”. The process for this has started already, with paperwork prepared.
Power Metal paid the remaining $108,952 of its $250,000 earn-in commitments, fullfilling the earn-in requirement using existing cash resources. The firm also chose to issue 5.1 million of new shares at 2.225p each, worth $200,000, to satisfy the final earn-in payment. Power Metal has also issued 2.6 million warrants with a 2.89p exercise price.
Chief executive Paul Johnson said: “Alongside its extensive exploration activities Power Metal is intent on generating material organic value from corporate work in respect of its portfolio of interests. In just seven months since we engaged with Silver Peak we are now, with our partners, planning to move this project interest into its own independent listing.
“The level of interest in quality silver projects is considerable and we believe that material value can be generated for Power Metal through the listing of Silver Peak.”
Silver Peak’s potential
Silver Peak is made up of a portfolio of mineral claims over a system of high-grade veins, part of the historical Eureka-Victoria silver mine in British Colombia.
In late December last year, Power Metal reported results from a November drilling campaign at Silver Peak. Despite challenging weather conditions, which curtailed the programme, drilling still “delineated very high-grade silver” including 5,270 grams per ton (“g/t”) or 169.5 troy ounces per tonne (“oz/t”) of silver in the Victoria vein.
This was around 150 metres deeper than the summer due diligence programme, which found “exceptionally high-grade channel sampling intersections” of up to 14,937 g/t or 480 troy oz/t silver.
Given the soaring price of silver, far ahead of its pre-pandemic price, Power Metal’s decision to secure its stake in Silver Peak is more than justified.
In January 2020, silver was trading at $18.04 per ounce. After dipping to only $12.27 per ounce in March 2020, silver quickly began its ascent and now stands at $26.08 per ounce – an incredible 45% jump from the January price.
No wonder, then, that silver project interest is on the rise.
Other IPOs on the horizon
Silver Peak is not Power Metals’ only upcoming project IPO to look forward to. The Kanye Resources strategic joint venture with Kavango Resources and Australia gold joint venture with Red Rock Resources are also planning IPOs. These spell great opportunities ahead for Power Metals.
“We believe that these proposed IPOs could accelerate the crystallisation of value from the company's projects into 2021, providing an earlier recognition of project value,” Johnson said.
Author: Anna Farley
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