LONDON, UK: Power Metal Resources PLC executed an agreement to acquire two exploration properties in Nevada USA.
The projects include the Garfield Gold-Copper Project and the Stonewall Gold Project, acquired outright from London quoted Sunrise Resources plc (LON:SRES).
The Properties will be acquired by a Nevada limited liability new company which will be the wholly owned local Nevada operating company for Golden Metal Resources Limited (“Golden Metal”), Power Metal’s 100% owned UK private subsidiary.
Paul Johnson, Chief Executive Officer of Power Metal Resources, commented: “The Acquisition Properties provide Power Metal with further exposure to precious and base metals exploration in Nevada USA and complement the recently acquired option over the Golconda Summit Gold Property, also in Nevada and announced on 1 June 2021.
Through this transaction Golden Metal, the wholly owned Power Metal subsidiary, now has a trio of gold – silver – copper exploration projects, targeting major metal discoveries in Nevada USA.
We expect to launch ground exploration in Nevada shortly, initially targeting near surface significant gold mineralisation at the Golconda Summit gold property and thereafter initial work programmes on the two properties acquired with today’s announcement. Further updates to the market in this regard are expected in the near term.”
The Vendor of the Properties is London AIM quoted Sunrise Resources plc (LON:SRES) and its two Nevada based wholly owned subsidiaries SR Minerals Inc and Westgold Inc.
The acquisition properties consist of two portfolios of United States Department of the Interior Bureau of Land Management (BLM) Mining Claims held 100% and in good standing by SR Minerals Inc. for the Garfield Gold-Copper Project; and by Westgold Inc. for the Stonewall Gold Project.
The Garfield Project is located approximately 10km east of the town of Hawthorne in Mineral County, Nevada. Garfield is in the prolific Walker Lane mineral belt which hosts several world class gold-silver epithermal (Comstock Lode, Tonopah), copper-gold porphyry (Anaconda), and iron-oxide-copper-gold deposits (Pumpkin Hollow).
Garfield was staked to cover a small area of gossanous material occurring at surface and discovered by Sunrise Resources in 2015. Initial sampling over the gossan returned rock results up to 6% Cu, 3.5g/t Au, and 124g/t Ag. A single 26m trench was oriented over part of the gossan in 2016 and returned an interval of 22m of 0.33% copper, including a 2m sub-interval grading 2.18% copper (16m-18m), and a separate 2m sub-interval grading 1.2g/t Au. The trench ended in mineralisation and remains open along strike. No additional follow up work has been completed on the Project.
The Company plans on executing a Phase 1 work programme that will include a property wide systematic soil geochemical survey designed to test continuity of skarn and porphyry-style mineralisation and elevated copper between the various historic grab sampling localities. The soil survey will be followed by a programme of trenching which should provide a cost effective means of evaluating any copper, gold and silver anomalies identified by the soil survey.
In addition the 2016 trench will be re-opened and extended to provide coverage of the mineralisation which currently remains open along strike.
Stonewall is located approximately 15km south of the historic mining town of Goldfield in Nye County, Nevada. Stonewall is also in the prolific Walker Lake mineral belt, and less than 60km southwest of the famous silver deposits of Tonopah which produced over 138 million ounces of silver from 1900-1921.1
Stonewall is centred on an approximately 1.2km long (open along strike) milky-white quartz vein with prevalent low-sulphidation epithermal boiling textures, which varies in thickness between 15-20m along its outcropping extent.
Rock sampling by previous operators returned anomalous gold-silver values (up to 1.17g/t Au and 161g/t Ag) with elevated mercury, which is characteristic of the shallow parts of a low-sulphidation epithermal system.
Minimal shallow historic drilling tested a limited strike length along the vein and returned downhole epithermal vein intersections up to 12m in width with stockwork zones up to 70m wide with elevated gold and silver results. Drilling was completed along parts of the vein easily accessible for a road, with the zones displaying the strongest epithermal textures remaining untested.
Placer Dome Inc. (now Barrick Gold Corp.), who optioned the Stonewall property in 2003, completed fluid inclusion analysis on surface samples which determined formation temperatures of 170°C, consistent with the upper parts of the epithermal System.
Considering the widths of the quartz vein and surrounding stockwork/alteration zones (up to 70m), the mapped strike-length extent (currently 1.2km; but remains open under cover) and the well developed boiling textures found at surface, the Company is of the belief that the Stonewall vein may represent the upper parts of a sizeable buried low-sulphidation epithermal system.
The Company plans on executing a diamond driling programme at Stonewall which will not only test the eastern extent, where boiling textures at surface are best developed, but also the broader system at depth where it is postulated the Au-Ag boiling zone of the system would be found.
The principal terms to acquire a 100% interest in the Properties are as follows:
– Power Metal will pay initial consideration of £20,000 cash and £61,875 payable through the issue to the Vendors of 2.25 million new ordinary shares of 0.1p each in Power Metal at a price of 2.75p per share (“new Ordinary Shares”)(“Consideration Shares”).
– In addition, Power Metal will issue to Sunrise Resources plc 2.25 million warrants with an exercise price of 3.75p per new Ordinary Share and life to expiry of 2 years from the date of issue (“Warrants”). Should the volume weighted average price (“VWAP”) of Power Metal shares meet or exceed 10 (ten) pence for 5 trading days Power Metal may serve notice on Sunrise Resources plc providing 14 calendar days to exercise and pay for the Warrants or the Warrants will be cancelled.
– The Vendors will retain a 2% Net Smelter Return (“NSR”) Royalty over the Properties. 1% of each Project NSR royalty may be repurchased by Golden Metal for US$1,000,000 at any time.
– The Properties will be acquired by a Nevada limited liability newly formed company and the local operating company wholly owned by Golden Metal, Power Metal’s 100% owned UK private subsidiary.
Power Metal Resources PLC
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16 Jun, 4:30 pm GMT+1 · Disclaimer