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(Sharecast News) - Metals exploration and development company Power Metal said on Monday that it has accelerated its earn-in to the Silver Peak Project in the Canadian province of British Columbia, it announced on Monday, which includes the Eureka-Victoria Silver Mine.
The AIM-traded firm said a new Canada-domiciled company was being formed to hold a 100% interest in the property, with Power Metal to retain its 30% interest in the project through the new company.
It said it had agreed with its partners which held the remaining 70% interest in Silver Peak, to list the project holding company on a recognised stock exchange, adding that the process had now started with relevant paperwork being prepared in that regard.
Power Metal said it had agreed to pay the CAD 0.11m (£0.06m) remaining under the exploration earn-in commitment of CAD 0.25m into the new company to extinguish that earn-in requirement, which would be made from existing cash resources.
It was also choosing to satisfy the final earn-in payment to secure its 30% project interest through the issue of 5,139,281 new ordinary shares at a price of 2.225p, and the issue of 2,569,641 warrants to subscribe for new shares at an exercise price of 2.89p and with a three-year life to expiry from Monday.
"Alongside its extensive exploration activities, Power Metal is intent on generating material organic value from corporate work in respect of its portfolio of interests," said chief executive officer Paul Johnson.
"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."
Johnson said the company would release more information on its plans once it has finished the important preparatory work for the listing.
"Power Metal now has three project interests moving forward with planned initial public offerings including Silver Peak; as well as Kanye Resources, the strategic joint venture with Kavango Resources; and the Australia gold joint venture with Red Rock Resources.
"We believe that these proposed initial public offerings could accelerate the crystalisation of value from the company's projects into 2021, providing an earlier recognition of project value."
At 1014 GMT, shares in Power Metal Resources were up 1.02% at 2.17p.
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