Power Metal Resources (LSE:POW) rose by more than 10pc on Tuesday after revealing that nickel sulphide targets have been confirmed at the Molopo Farms Complex (MFC) project in Botswana.
A helicopter-borne electromagnetic survey (EM) over the 2,725km2 asset’s feeder zone delineated numerous targets for exploration that were subsequently followed up with ground EM surveys. This latter work detected several ‘discrete, highly-conductive bodies’ that boast the spatial location, geological setting and associated magnetic response held by many existing nickel sulphide targets.
As a result, project owner Kalahari Key has designed eight drill holes to intersect the six highest priority targets. The firm will now appoint consultants to implement the necessary environmental surveys and complete consultations with landowners and other stakeholders before any drilling.
Power Metal, which was trading another 16.7pc higher at 0.53p on Wednesday, currently gets its exposure to the MFC project from its 18.26pc position in Kalahari Key. However, the company also has a right by 31 December this year to choose to earn into a 40pc direct project interest by investing $500,000 in its development by 31 December 2020. If it were to take this route, it would hold a 50.96pc effective economic interest in the MFC asset.
In Tuesday’s update, Power Metal’s executive director Paul Johnson described the opportunity on offer at the MFC as ‘immense’, adding:
‘I have been here before as a director of other companies before the drilling of major targets; when the market doesn’t quite gather the potential and my job is to engage the market with the opportunity before us. It is far easier to engage post discovery than pre-drilling, but I will over the coming months make it my task to ensure that investors cannot say, should we make a nickel sulphide discovery, that they were not adequately informed of the possibility.
‘I remain fascinated by the Kalahari Key opportunity and intrigued as to what might lie beneath the drill locations. I am equally keen to work with the Kalahari Key team to determine and implement the project development pathway. We look forward to keeping shareholders updated in this regard.’
The news came just a week after Power Metal released a company update that saw it report ‘good progress’ across its portfolio in spite of severe market conditions.