11 January 2021

Power Metal Resources PLC

 ("POW" or the "Company")

Botswana Molopo Farms Complex - Drilling Update

Power Metal Resources plc (LON:POW) the AIM listed metals exploration and development company is pleased to provide a further update from the Kalahari Key Mineral Exploration Pty Ltd ("Kalahari Key" or "KKME") Molopo Farms Complex Project (the "Project" or "MFC Project"), which is targeting prospective massive nickel sulphide and platinum-group metal ("PGM") mineralisation in Botswana.

CHIEF EXECUTIVE OFFICER UPDATE

Paul Johnson Chief Executive Officer of Power Metal Resources commented:

"The identification of visible sulphides during the geological core-logging process for hole KKME 1-6 is a potentially significant development, subject of course to assay testing of samples, opening up the potential for PGM mineralisation besides the base metals originally targeted.

We are now in the midst of an extensive technical review of the entire licence areas with a particular focus around the first two drill holes. This will further refine our present targets and generate new targets for the remainder of the drill programme.

It is worth noting that the Molopo Project drill programme is an immense exercise and already we have over 1,000 metres of core to examine and process.  The size and scale of this exercise is matched only by the hard work and determination of the team in the field, for which I am particularly grateful.

I look forward to providing further updates as further material developments occur."    

Highlights:

·    Following the successful drilling of the first two diamond drill holes (KKME 1-14 and 1-6), to their initial target depth, as previously announced, an extensive technical review is currently underway at the Molopo Farms Complex project.

·    Initial geological core-logging by KKME's consulting geologist has identified 4.4 metres of ultramafic rocks with finely disseminated sulphides in angled hole KKME 1-6 at approximately 270m vertical depth.

·  The setting of this sulphide intersection is consistent with KKME's geological model and suggests prospectivity for platinum group metals as well as base metals. The core will now be split to allow  more detailed examination of the mineralogy prior to dispatch for assay.

·   Assay testing of core samples from both drill holes including specifically the above intersection is to be undertaken at an accredited laboratory in South Africa.

·   The deepening of drill hole KKME 1-6 from 547 metres to circa 600-650 metres hole depth is set to commence in the week commencing 11 January 2021.

·   Downhole geophysics field work and interpretation for the two holes drilled to date is expected to be completed by the end of January.

·    Detailed data is also under review in respect of KKME's engagement of Aster Funds Ltd and Bell Geospace Ltd to integrate innovative exploration survey and processing techniques with the existing KKME airborne, Natural Field Audio Magneto Telluric ("AMT") ground and downhole geophysical datasets.  This should accelerate and refine the exploration targeting process for future drill testing.

·   Following consideration of the extensive data collected from the technical review work, KKME will determine the optimal locations for the two remaining planned drill holes and specific mineralisation targets.

·    Reflecting the above technical review process and the additional work to be undertaken including diamond drilling, the formal earn-in period (taking Power metal to a 40% Project level interest) has been amended with the mutual agreement of Power Metal and KKME, to the period ending 30 April 2021.   This will allow adequate time for the receipt and payment of invoices relating to the earn-in exploration activities.

OWNERSHIP STRUCTURE - MOLOPO FARMS COMPLEX PROJECT

Power Metal currently has an 18.26% shareholding in Kalahari Key and has elected to earn in ("Earn-In") to a 40% direct interest in the MFC Project by funding US$500,000 of exploration expenditure by 30 April 2021, notably the diamond drilling of selected targets (the "Drill Programme").  To date Power Metal have paid US$192,641 leaving a balance remaining of US$307,359 (approximately £230,523) which is fully covered by Power Metal cash resources.

THE DRILL PROGRAMME

The Drill Programme was for an initial planned 2,505m across four diamond core drill holes with planned target hole depths varying from 525m to 710m.  Ultimate meterage to be drilled will be determined in due course.

The Drill Programme is designed to intersect four high priority targets prospective for massive nickel sulphide mineralisation, delineated by both Time Domain Electromagnetic ("EM") and Natural Field Audio Magneto Telluric ("NF-AMT") geophysics surveys.

DRILL HOLE KKME 1-14

The first drill hole KKME 1-14 at the MFC Project attained a target depth of 515.8m.  The hole was completed safely and securely and achieved near 100% core recovery.

KKME 1-14 was sited in the Jwaneng-Makopong Shear/Feeder zone to the east of the main Molopo Farms Complex intrusion.

KKME 1-14 successfully confirmed the geological proposition that the geology at Molopo Farm is that of a feeder zone. 

DRILL HOLE KKME 1-6

Hole KKME 1-6 is the second hole with a current end of hole depth of 547.4m (to be deepened to circa 600-650m). The hole was originally designed to intercept the upper side of a conductive body modelled from geophysical survey data to commence around 500m down-hole depth.

KKME 1-6 is located in the project's Tshepo (Hope) Central Target Area, approximately 20km west-southwest of the programme's first drill hole KKME 1-14 and along strike on the shear zone interpreted as the Molopo Farms Complex Feeder Zone.

The Tshepo (Hope) Central Target Area lies within the centre of the interpreted feeder zone inside the near-surface sub-crop of the Molopo Farms Complex in Licence PL311/2016.

FURTHER INFORMATION TECHNICAL FOLLOW UP WORK

KKME have signed agreements with Aster Funds Ltd ("AFL") and Bell Geospace Ltd ("Bell") to integrate innovative exploration survey and processing techniques with the existing KKME airborne, AMT ground and downhole geophysical datasets with a view to accelerating and refining the exploration targeting process for future drill testing.

AFL employ satellite-based Aster Thermal Imagery to provide target mapping through longwave infra-red ("LWIR") and shortwave infra-red ("SWIR") Spectral Analysis and electromagnetic ("EM") conductivity analysis based on Synthetic Aperture Radar. These systems complement KKME's geophysical datasets and will help in the rapid determination of both the near-surface geology and alteration minerals which could be linked to underlying mineralised systems.

The collaboration with Bell will facilitate the integration and analysis of the KKME airborne and ground geophysical data with Bell's high-resolution Zeppelin airship-supported gravity data collected over the three KKME Molopo Farms Complex licence areas (PL202/2018, PL310/2016, PL 311/2016). 

COMPETENT 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 Competent 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.

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:

Notes to Editors:

Power Metal Resources plc (LON:POW) is an AIM listed metals exploration and development company seeking a large scale metal discovery.

The Company has a global portfolio of project interests including precious metal exploration in North America and Australia together with base and strategic metal exploration in Africa. Project interests range from early stage greenfield exploration to later stage prospects currently subject to drill programmes.

The Board and its team of advisors have expertise in project generation, exploration and development and have identified an opportunity to utilise the Company's position to become a leader in the London market for investors wishing to gain exposure to proactive global metals exploration.