Power Metal Resources PLC First Development Resources Selta Project Update (0461W)

TIDMPOW

RNS Number : 0461W

Power Metal Resources PLC

07 December 2023

7 December 2023

Power Metal Resources PLC

("Power Metal" or the "Company")

First Development Resources Plc Selta Project Exploration Update

Exploration Data Review Identifies Additional Exploration Target Areas at the Selta Project in Australia's Northern Territory

Power Metal Resources plc (AIM:POW), the London listed exploration company seeking large-scale metal discoveries across its global project portfolio, announces an exploration update for the First Development Resources Plc ("FDR") Selta Project ("Selta" or the "Project") located in the Northern Territory of Australia. Power Metal holds a 58.59% interest in FDR.

To develop the Company's understanding of the Selta Project, FDR commissioned an Australian-based consultancy to complete a high-level geophysical and geographical information system ("GIS") based desktop study ("the Study") on the Selta Project's mineral exploration potential and prospectivity to further develop target areas for follow-up field inspection on completion of the planned FDR initial public offering ("IPO"). The Study has now been received and the findings are reported below.

HIGHLIGHTS:

-- Significant expansion of existing rare-earth element ("REE") and lithium ("Li") exploration target area, and generation of new target areas building on previous ground-based exploration and desk-based data reviews carried out by FDR.

-- Following detailed compilation of historical drilling and surface geochemical data into comprehensive datasets, specific mineral exploration target areas were established for orogenic gold ("Au") and base metals, including inferences on the potential for iron-oxide copper-gold ("IOCG") and iron-sulphide copper-gold ("ISCG") mineralisation within the Project area.

-- Specifically, the Study has enhanced FDR's understanding of the potential within target areas identified for REE mineralisation having a similar geological setting to Arafura Rare Earths Ltd's (ASX: ARU) nearby Nolans Project, together with lithium-caesium-tantalum ("LCT") pegmatites relating to the same fractionated granite intrusions sourcing REE, tin and tantalum mineralisation just to the south and east.

-- The outputs from the Study have provided a more geologically focussed summation of the mineral prospectivity within Selta and provide an inventory of prioritised target areas across multiple minerals and metal styles An exploration strategy is now being developed to systematically test the identified targets.

Tristan Pottas, Chief Executive Officer of FDR, commented:

"FDR has continued to work proactively to advance its business interests in advance of the planned IPO which it hopes to resume as soon as Market conditions allow.

With the company's Wallal Project in Western Australia fully prepared for drilling, our attention has turned to the Selta Project where previous mineral explorers identified a number of high-profile gold and base metal targets and paving the way for FDR to identity REE and LCT pegmatite targets. Our updated mineral target inventory has been significantly boosted with the findings announced today, including notably gold and base metals in historical drilling, along with the realisation that the province is also prospective for IOCG and ISCG targets.

At Wallal, we are drill ready and eagerly looking to commence deep drilling on high priority gold targets at the earliest opportunity, commencing with the magnetic bullseye Eastern Anomaly target which we believe bears striking geophysical similarity to the Havieron discovery made by Greatland Gold plc in the same Paterson province as Wallal."

Sean Wade, Chief Executive Officer of Power Metal Resources PLC, commented:

"Our intended IPO for FDR is taking longer than anticipated due to stagnant market conditions for capital raisings. To keep the IPO process moving forward, FDR brought forward the study on Selta which was previously planned to be completed post-IPO. Working within the constraints of a tight budget, the team worked closely with experts in Australia to enhance our already compelling exploration case for the Selta Project.

I am confident that FDR's updated exploration target areas add substantially to the investment case for FDR and will help to take the Company forward for obtaining funding to aggressively explore these target areas. We look forward to updating the market on FDR's next steps in due course".

BACKGROUND:

In preparation for FDR's planned IPO and admission to the London markets, and to aid in planning focussed fieldwork upon listing, FDR commissioned Perth, Western Australia ("WA"), based consultancy Resource Potentials Pty Ltd ("ResPot") to complete a geophysical and GIS-based desktop study on the mineral exploration potential of FDR's Selta Project mineral exploration tenements located in the Central Arunta Region of Australia's Northern Territory (Figure 1).

The Study undertaken by ResPot compiled publicly available historical exploration datasets to help assess the mineral deposit potential of Selta and generate and prioritise target areas for aggressive exploration post FDR's IPO and included

- detailed compilation and review of historical mineral exploration reports and technical data sets;

- compilation, processing, imaging, digitisation and review of publicly available open-file company and government datasets consisting of drilling, geophysical, geochemical, and geological datasets, and results; and

- the Study also included establishing comprehensive modern data from historical drilling and surface geochemical sampling to advance the Study and highlight new target areas of interest.

Prior to the Study, FDR identified multiple uranium and REE targets within the Selta Project area and also highlighted the potential for lithium, gold and base-metal mineralisation. Prior fieldwork completed by FDR allowed for limited testing of lithium targets within the southern portion of the Project by identifying and sampling pegmatite outcrops, but the FDR technical team felt that considering the Project's large size, complex geology and previous exploration history, a further modern and comprehensive data compilation and targeting study was warranted.

The Study has now identified the potential for multiple target minerals, including:

- REEs geologically similar to the Nolans Project and ionic clay type REE mineralisation in weathered fractionated granite;

   -      LCT-pegmatites; 
   -      Lode gold in Lander Rock meta-sediment-volcanic greenstone belt; and 

- Base metals in a skarn setting, specifically for tungsten, molybdenum tin and silver similar to the Molyhill Project tungsten deposit, held by Thor Energy PLC (ASX / AIM: THR), to the east.

The study also mentions the potential for IOCG and ISCG mineralisation surrounding intrusive bodies sourcing similar styles of mineralisation within the broader Arunta mineral province.

Figure 1 : Selta Project regional setting in relation to existing deposits and known mineral occurrences.

SELTA PROJECT - DATA COMPILATION AND REVIEW

Concurrent with the Study, ResPot liaised with WA based Rock Solid Pty Ltd ("Rock Solid") to help compile open-file surface and downhole drilling geochemical data from historical exploration reports and Northern Territory Geological Survey ("NTGS") databases into edited and validated master databases which ResPot then incorporated into the Study.

A total of 10,622 drillholes were identified and integrated into a GIS database and Leapfrog workspace, of which 2,204 are within the boundaries of the Selta Project mineral exploration licences. The drillholes vary in depth from small vacuum holes to 178 m deep reverse circulation ("RC") and diamond core drill holes which were completed by previous exploration companies looking predominantly for uranium, gold and base metals.

The data compilation by ResPot and Rock Solid remains on-going as additional datasets become uncovered and are integrated into FDR's master databases.

A total of eight target areas have been identified by the Study. FDR's technical team has identified a ninth target the updated target areas are presented in Figure 2. The exploration target areas have also been priority ranked for prospectivity by ResPot using a simple priority ranking between one (high) to three (low), and these exploration target areas have undergone detailed follow-up analysis by FDR's in house technical team and given target area names as shown on Figure 2.

 
 Target              Target minerals    Ranking   Comments 
  Area 
==================  =================  ========  ================================================== 
 Ingallan            LCT and REE        1         Located in the extreme east of 
                                                   the Selta Project area, the Ingallan 
                                                   LCT and REE target covers outcropping 
                                                   Ennugan granite which is considered 
                                                   prospective for allanite-related 
                                                   REE mineralisation and has a potential 
                                                   for weathered granite ionic clay 
                                                   REE mineralisation. The Ennugan 
                                                   granite is of a similar age to 
                                                   the phosphate dykes hosting the 
                                                   nearby Nolans Project REE deposit 
                                                   mineralisation. To date, no drilling 
                                                   and very limited ground exploration 
                                                   has been carried out in this highly 
                                                   prospective target area. 

==================  =================  ========  ================================================== 
 Hawkshead           LCT and REE        2         All four of these REE and LCT-pegmatite 
                                                   target areas are located on and 
                                                   around the contact zone between 
                                                   granites of the Yundurbulu suite 
                                                   and metasedimentary-volcanic rocks 
                                                   of the Lander Range greenstone 
                                                   belt. These target areas have been 
                                                   sparsely tested by historical drilling 
                                                   and historical drillholes within 
                                                   the Selta Project were not analysed 
                                                   for lithium ("Li"), caesium ("Cs"), 
                                                   tantalum ("Ta") , tin ("Sn"), tungsten 
                                                   ("W"), niobium ("Nb") or REEs. 
                                                   Previous geochemical sampling by 
                                                   FDR in 2022 and 2023, plus historical 
                                                   stream sediment sampling by a former 
                                                   explorer returned low-level but 
                                                   anomalous results for key elements 
                                                   including Li, Cs, Nb, Sn, Ta, cerium 
                                                   ("Ce") and yttrium ("Y") within 
                                                   these target areas. Of note is 
                                                   the presence of historical tin 
                                                   workings to the west and near a 
                                                   granite contact, suggesting that 
                                                   the granite in this area may be 
                                                   fertile for LCT pegmatite and REE 
                                                   mineralisation. 
==================  =================  ========  ================================================== 
 Spring 
  Creek              LCT                3 
==================  =================  ========  ================================================== 
 Loora Creek         LCT                3 
==================  =================  ======== 
 West Nintabrinna    REE                2 
==================  =================  ========  ================================================== 
 Lander              Gold ("Au")        1         Centred on a gravity ridge and 
  West                                             topographic high, which corresponds 
                                                   to a greenstone belt of metasedimentary-volcanic 
                                                   rocks of the "the Lander Beds", 
                                                   which cross the western part of 
                                                   the project area and is noted to 
                                                   contain multiple gold and base 
                                                   metal occurrences to the south 
                                                   and east of the Project. Historical 
                                                   exploration in the Lander West 
                                                   area has yielded drill intercepts 
                                                   of up to 1.9 g/t gold, alongside 
                                                   elevated arsenic and base metals. 
                                                   Previous drilling in this area 
                                                   has been shallow (42 m on average) 
                                                   and the area hosts multiple untested 
                                                   magnetic features and shallow geochemical 
                                                   anomalism never followed up by 
                                                   deeper drilling. 
==================  =================  ========  ================================================== 
 Yundurbulu          Gold ("Au")        2         Located in a similar geological 
                                                   environment to Lander West, the 
                                                   Yundurbulu area has been largely 
                                                   untested by previous explorers, 
                                                   data has been obtained for 153 
                                                   historical shallow drillholes however 
                                                   the vast majority are <10 m deep. 
                                                   Approximately 500 m from the perimeter 
                                                   of the Selta Project is the historical 
                                                   "Black Knight" gold prospect, which 
                                                   yielded up to 6.58 g/t Au, and 
                                                   magnetic data suggests a continuation 
                                                   of the same linear feature hosting 
                                                   Black Knight to extend into the 
                                                   Selta exploration licences. 
==================  =================  ========  ================================================== 
 Vaughan             Base metals        3         Comprising part of the Vaughan 
  Springs                                          Springs Dome, this target area 
                                                   is defined by an enigmatic ring-like 
                                                   magnetic anomaly feature. Very 
                                                   little surface sampling or effective 
                                                   drilling has been completed in 
                                                   this area, however a number of 
                                                   predominantly shallow vacuum holes 
                                                   have been drilled to depths < 11 
                                                   m along with four deeper rotary 
                                                   air blast holes to depths of up 
                                                   to 112 m. Some historical drillhole 
                                                   samples returned elevated assay 
                                                   results for tungsten ("W"), silver 
                                                   ("Ag"), cobalt ("Co") and zinc 
                                                   ("Zn"). ResPot has proposed a skarn 
                                                   style mineralisation model for 
                                                   this target area due to the proximity 
                                                   of granite, and historically drilled 
                                                   metasediments. In addition, ResPot 
                                                   have proposed the Vaughan Springs 
                                                   Target to be similar to other skarn 
                                                   style base metal deposits located 
                                                   to the east, such as the Molyhill 
                                                   Project. 
==================  =================  ========  ================================================== 
 Western             Uranium            2         The Study identified that historical 
  Creek                                            uranium exploration across much 
                                                   of the Project area had tested 
                                                   prospective areas, and the potential 
                                                   for primary hard rock and secondary 
                                                   soft rock uranium deposits was 
                                                   low. 
                                                   FDR's technical team have analysed 
                                                   historical exploration reports 
                                                   and located a potential roll front 
                                                   style uranium target area in the 
                                                   north of the Project area which 
                                                   was identified by Toro Uranium 
                                                   in 2010 and which remains untested. 
==================  =================  ========  ================================================== 
 

PROPOSED EXPLORATION STRATEGY AT SELTA

As part of the Study, the following exploration programmes are proposed:

-- Further detailed interpretation and review to be carried out on the Ingallan LCT and REE target area, including field visits to collect rock samples, grids of soil geochemical surveying, and if results warrant then carry out follow-up RC drilling. In addition, possible Horizontal-to-Vertical Spectral Ratio ("HNSR") passive seismic surveying over ionic clay REE target zones to test for weathering depth prior to drill testing.

-- The Hawkshead, Spring Creek, Loora Creek and West Nintabrinna lithium and REE target areas in the southwest of the Project are proposed to receive field inspection and geochemical sampling of soils to identify targets for hard rock drill testing.

-- Lander West geochemical soil sampling campaign is proposed to refine current target areas, the Yundurbulu Gold target area is almost wholly unexplored and therefore field teams will be deployed to carry out inspection and prospecting of the geology, with follow-up geochemical testing and then drilling if warranted.

-- Drill testing on various walk-up targets, including the Vaughan Springs base metal magnetic ring target area, gold targets where shallow Au and pathfinder elements have been identified by shallow drilling but not yet followed up by deeper RC drilling into fresh bedrock, and LCT / REE pegmatite targets in outcrop, is a short to medium term aim of FDR.

-- FDR is currently evaluating exploration possibilities for a roll front uranium target in the northwest of the Project.

Figure 2 : Selta Project targets identified for further exploration located within FDR's mineral exploration tenements (black outline).

FDR CORPORATE ACTIVITY

First Development Resources Plc (58.59% POW) holds strategic exploration projects in Western Australia and the Northern Territory and is fully prepared for an IPO listing at short notice subject to favourable market conditions and final regulatory approvals.

FDR EXPLORATION INTERESTS

FDR Australia holds the following mineral exploration licence interests:

Wallal Project in WA (Wallal Main - E45/5816 - 390km (2) - granted, Wallal West 1-E45/5853 96km (2) - granted , and Wallal West 2 - E45/5880 - 86km (2) - granted).

A comprehensive geophysical review has identified three magnetic bullseye anomalies located under Phanerozoic sedimentary cover which are interpreted to have geological similarities major Au-Cu deposits within the Paterson Province, including Winu (Rio Tinto) and Havieron (Newcrest Mining-Greatland Gold joint venture).

FDR has secured a c. GBP110,000 Co-funding grant from the Western Australian government as part of their Exploration Incentive Scheme to be offset against the costs of Wallal drilling, and the Company has received all the necessary local approvals to commence drilling.

FDR has also agreed to contract DDH1 Drilling Ltd to undertake the phase I diamond drilling drill programme at Wallal, where FDR has already prepared the access and the drill pad locations in readiness for drilling. Recognising this progress, the early commencement of drilling is being considered alongside the work being undertaken to finalise the IPO listing.

Braeside West Project in WA (E45/5854 - 137km (2) - one granted licence)

In-depth desktop analysis of historic exploration data is currently underway on the Braeside West Project, located in the northeast Pilbara region. A recent base-metal discovery by neighbouring company Rumble Resources Ltd (ASX: RTR) has enhanced the overall prospectively within the Braeside West Project area as it is hosted within a similar geological environment to that of Rumble Resources discovery.

Ripon Hills Project in WA (E45/5088 - 42km (2) - one granted licence).

The Ripon Hills Project is also located in the northeast Pilbara Region and is prospective for base-metal and gold mineralisation associated with deep-seated north-south oriented fault structures which run through the Ripon Hills Project area. In-depth desktop analysis of historic exploration data is currently underway over the project.

   Selta Project in the NT   (EL 32737, EL 32738 and EL 32755 - 1,575km (2)  - three granted licences) 

The Selta Project is located in an emerging mineral province of the Arunta, considered to be highly prospective for uranium and rare-earth element mineralisation, and now niobium ("Nb") with the discovery of carbonatites on the WA side by WA1 (ASX: WA1). FDR recently completed an in-depth review study of all historical and new geological, geophysical and geochemical data, which also identified the potential for REE, gold and base-metal mineralisation, as well as the possibility of LCT pegmatites.

GLOSSARY

 
 Allanite-Related REE         Allanite is a mineral that is found in 
  Mineralisation               metamorphosed clay-rich sediments and 
                               granitic rocks as part of its chemical 
                               structure 
 Base metals                  A common metal that is not considered 
                               precious, such as copper, tin, or zinc 
 Diamond core drilling        A commonplace method of drilling using 
                               a circular drill bit (with diamonds) 
                               to cut through the rock, and produce 
                               a long 'core' of rock for examination 
                               and testing. 
 Fractionated Granite         As granites, or other rocks which are 
                               formed from a magma cool, certain minerals 
                               crystallise from the melt at higher temperatures 
                               than others, this results in the granitic 
                               magma becoming more and more concentrated 
                               in certain elements over others. Under 
                               these conditions, the granite is 'fractionated' 
 Geographical Information     GIS is a system that creates, manages, 
  System (GIS)                 analyses, and maps all types of data, 
                               allowing for the rapid, yet highly detailed 
                               and precise analysis of geographic data. 
 Greenstone Belt              Zones of variably metamorphosed volcanic 
                               sequences with associated sedimentary 
                               rocks that occur within ancient rocks. 
 Horizontal-to-Vertical       The horizontal-to-vertical spectral ratio 
  Spectral Ratio ("HVSR")      (HVSR) passive-seismic method is a geophysical 
  passive seismic surveying    technique that uses seismic noise signals 
                               to estimate properties of unconsolidated, 
                               overburden sediments 
 Ionic Clay                   A clay that is greatly enriched in rare-earth 
                               elements, through the absorption of such 
                               elements into the clay's chemical structure 
 Iron-oxide copper-gold       A type of ore deposit that contain valuable 
  (IOGC)                       concentrations of copper, gold, and uranium. 
                               They are hosted within iron oxide dominant 
                               gangue assemblages and are often associated 
                               with quartz veining and iron-rich rocks. 
 Iron-sulphide copper-gold    A type of ore deposit that contain valuable 
  (ISCG)                       concentrations of copper, gold, and uranium. 
                               They are hosted within sulphide dominant 
                               ore that is present as veins, breccias 
                               (broken rocks) or replaces the original 
                               geology. 
 lithium-caesium-tantalum     A type of pegmatite that contains elevated 
  (LCT) pegmatite              volumes of lithium, caesium and tantalum; 
                               these pegmatites form the majority of 
                               the worlds hard rock lithium resources. 
 Lode gold                    Lode gold is a type of gold deposit that 
                               forms as a vein in rock 
 Meta-Sediment-Volcanic       Metamorphosed (heated and squashed over 
                               geological time) rocks that were originally 
                               derived from sedimentary and volcanic 
                               rocks. 
 Orogenic gold                An orogenic gold deposit is a type of 
                               hydrothermal mineral deposit that is 
                               formed during syn- to late metamorphic 
                               stages of orogeny. These deposits are 
                               hosted by shear zones in orogenic belts, 
                               specifically in metamorphosed fore-arc 
                               and back-arc regions, their formation 
                               is strongly related to the structural 
                               geology (faults/shears) of the area, 
                               as hydrothermal fluids migrate through 
                               pre-existing and active discontinuities 
                               (faults, shear zones, lithological boundaries) 
                               generated by tectonic processes 
 Rare-earth elements          Rare-earth elements (REE) are a group 
                               of 17 metallic elements that are found 
                               in the Earth's crust. They include the 
                               15 lanthanides (lanthanum, cerium, praseodymium, 
                               neodymium, promethium, europium, gadolinium, 
                               terbium, dysprosium, holmium, erbium, 
                               thulium, ytterbium, and lutetium) and 
                               scandium and yttrium. These elements 
                               are called "rare" because they are difficult 
                               to extract from the earth's crust and 
                               are not found in large quantities 
 Reverse circulation (RC)     Reverse circulation drilling is a method 
  drilling                     of drilling that uses dual wall drill 
                               rods consisting of an outer drill rod 
                               with an inner tube. The hollow inner 
                               tubes allow the drill cuttings to be 
                               transported back to the surface in a 

                               continuous, steady flow. Unlike diamond 
                               drilling, it compiles sample rock cuttings 
                               instead of rock core. 
 Roll front                   A roll-front uranium deposit is a type 
                               of uranium ore deposit that occurs in 
                               sandstones downstream from redox fronts 
                               or reduced/oxidized geochemical barriers. 
 Skarn                        coarse-grained metamorphic rocks that 
                               form by replacement of carbonate-bearing 
                               rocks (containing calcium oxide), these 
                               can often contain metals such as tin, 
                               tungsten, manganese, copper, gold, zinc, 
                               lead, nickel, molybdenum and iron. 
 Vacuum drilling              A method of drilling through loose sediments, 
                               where material is vacuumed from the base 
                               of the hole for inspection and testing 
 

QUALIFIED PERSON STATEMENT

The technical information contained in this disclosure has been read and approved by Mr Nick O'Reilly (MSc, DIC, MIMMM, MAusIMM, FGS), who is a qualified geologist and acts as the Qualified Person under the AIM Rules - Note for Mining and Oil & Gas Companies. Mr O'Reilly is a Principal consultant working for Mining Analyst Consulting Ltd which has been retained by Power Metal Resources PLC to provide technical support.

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:

 
Power Metal Resources plc 
Sean Wade (Chief Executive Officer)                     [phone] 
 
 
  SP Angel Corporate Finance (Nomad and Joint Broker) 
Ewan Leggat/Charlie Bouverat                            [phone] 
 
 
  SI Capital Limited (Joint Broker) 
Nick Emerson                                            [phone] 
 
 
  First Equity Limited (Joint Broker) 
David Cockbill/Jason Robertson                          [phone] 
 
 
 
 

NOTES TO EDITORS

Power Metal Resources plc - Background

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration company which finances and manages global resource projects and is seeking large scale mineral and metal discoveries.

The Company has a principal focus on opportunities offering district scale potential across a global portfolio including precious, base and strategic metal exploration in North America, Africa and Australia.

Project interests range from early-stage greenfield exploration to later-stage prospects currently subject to drill programmes and results.

Power Metal will develop projects internally or through strategic joint ventures until a project becomes ready for disposal through outright sale or separate listing on a recognised stock exchange thereby crystallising the value generated from our internal exploration and development work.

Value generated through disposals will be deployed internally to drive the Company's growth or may be returned to shareholders through share buy backs, dividends or in-specie distributions of assets.

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