Winsome to Increase Stake in Power Metals Corp.

Lithium exploration and development company Winsome Resources (ASX:WR1; “Winsome” or “the Company”) is pleased to announce as it increases its focus on its world-class hard-rock discovery at Adina, it has reached terms with Power Metals Corp (“PWM”) and Mr Glenn Griesbach for PWM to acquire the Company’s Decelles and Mazérac projects in Quebec, Canada.

HIGHLIGHTS

• Winsome advances process to increase its stake in Power Metals Corp (“PWM”) to 19.59%
• Under agreement terms Winsome will transfer its ownership in the Decelles¹ and Mazérac² projects to PWM
• Winsome focussed on development of its globally significant hard-rock lithium discovery at Adina
• PWM will assume the future royalty obligations for Decelles and Mazérac Projects
• Winsome to retain the obligation for issue of Performance Shares under the Mazérac Option³ 

About the Decelles & Mazerac projects

The Decelles project area covers 385km² holding 669 claims close to the mining centres of Val-dÓr and Rouyn-Noranda, approximately 600km from Montreal.

The prospective Mazérac region project holds 259 claims across 149km² and is less than 30km east of Decelles.

Both projects are in close proximity to established infrastructure and major mining centres with a history of recent lithium discoveries.

About the Case Lake project

PWM 100%-owns its flagship Case Lake Property, where it has identified high grade Lithium, Tantalum and Cesium mineralisation through four previous exploration programs, with the latest conducted mid- 2022 comprising 36 holes for 2,783.8m (Appendix 1). Mineralisation is hosted in a swarm of pegmatite dykes adjacent to the Case Lake Batholith, with six dykes the focus of exploration to date (North, Main, South, East and Northeast – on the Henry Dome, and the West Joe Dyke on a tonalite dome).

Cesium mineralisation at Case Lake occurs as pollucite and is hosted by a pegmatite dyke (the West Joe Dyke) which also contains lithium and tantalum mineralisation. There have been only 3 pegmatite mines globally that produced cesium: Tanco (Canada), Bitika (Zimbabwe), and Sinclair (Australia).

The presence of shallow exceptionally high-grade Cesium was confirmed at the West Joe Dyke following drilling in 2018, through the presence of pollucite in drill core, a rare occurrence in Ontario.⁴

Drilling at West Joe in 2022 returned results of 22.22 % Cs2O and 1.46 % Li2O over 2.00m (PWM-22-143, 14.0 - 16.0m) & 5.72 % Cs2O, 1.94 % Li2O and 862 ppm Ta over 4.24m (PWM-22-150, 27.76 – 32.0m).⁵

High grade lithium and tantalum mineralisation is also present in the other pegmatite dykes at Case Lake with 2022 drilling including highlights of 1.71% Li2O and 241ppm Ta over 12.0 m from 11.0m (PWM-22- 132) and 1.58% Li2O and 143ppm Ta over 15.0m from 19.0m (PWM-22-134) from drilling at Main Dyke.⁶

Details of the 2022 drilling campaign are appended as Appendix 1.

Terms of the transaction

Under the terms of the transaction:

• Winsome will issue Mr Glenn Griesbach 377,000 fully paid ordinary shares in the Company to complete the acquisition of the Decelles and Mazérac exploration licences. This issue of shares will be completed under the Acceleration clause in each of the agreements.7
• The Company will transfer the licences to PWM for consideration of 17,650,000 ordinary shares in PWM, taking Winsome’s holding in PWM to 19.59%.
• Winsome has assigned PWM its royalty payment obligations that it previously owed Mr Griesbach under the Decelles and Mazérac Option Agreements.
• The Company will retain the obligation to issue Performance Shares under the Mazérac Option Agreement for 24 months from the date of the exercise of the Option agreement. This is in accordance with the amended option agreement terms announced to the ASX on 15 August 2023. Notwithstanding this, Power Metals will be undertaking the work and incurring the expenditure that is required to satisfy the relevant milestones. If the milestones are not satisfied within the next two years, then no Performance Shares will be issued by Winsome.

WINSOME’S MANAGING DIRECTOR CHRIS EVANS SAID:

“We are pleased to announce progress towards this transaction with Power Metals, which when executed with increase Winsome stake in PWM to 19.59%.

“This is an exciting opportunity for the Company as PWM progresses its own exploration program. The exposure to a potentially significant cesium project is very attractive given the rare nature of pollucite-hosted deposits globally.

“The terms will ensure ongoing exploration on the Decelles and Mazérac licences in the shorter term, while the Company concentrates its resources toward a maiden Mineral Resource Estimate at Adina and further expansion of the Cancet project.

“With Decelles and Mazérac being approximately 350 kilometres from PWM’s Case Lake project in neighbouring Ontario, it makes commercial sense for PWM to execute exploration activities at these sites.

“The Winsome team looks forward to continuing our strong relationship PWM.”

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