Power Metal Resources PLC (LON: POW) the AIM listed metals exploration and development company is pleased to announce a business financial review and warrant update for shareholders.

Paul Johnson, Chief Executive Officer of Power Metal Resources commented: 'Power Metal has multiple exploration programmes underway alongside significant corporate activities in and around certain of our projects.

Given the extent of our activities I would like shareholders to also know that your Company is in a strong financial position and is well funded to complete all its currently planned exploration work, including drilling programmes underway at present.

Moreover, after the current programme of extensive exploration activities to 31 March 2021 are complete and paid for, the Company will still have significant financial resources and remain in a strong position. This is further explained below with information regarding where we are with business operations, key financial exploration commitments and our underlying financial position.

In addition, I would draw shareholders attention to the 'Warrant Update' section below which confirms Power Metal has successfully exceeded the price hurdle to enable acceleration of certain warrants. Recognising Power Metal's strong financial position we consider there is no requirement to exercise any right to accelerate warrants at this time.

Finally, the Company notes that in the Final Results for the year ended 30 September 2019 (announced 20 May 2020) reference was made to a planned fundraising in November 2020. Given the GBP1 million raised in July 2020 and the receipt of warrant exercise monies since August, there was no need to undertake a fundraising in November 2020.'

BUSINESS AND FINANCIAL REVIEW

Power Metal's working capital position as at 12 January 2021 was circa GBP2.72 million including Pounds Sterling, US Dollars, Australian Dollars and Canadian Dollars and the current value of the Company's listed investments.

The Company's anticipated exploration and corporate spending for the period to 31 March 2021 is currently estimated at circa GBP0.6 million and as a result following the completion of the period to 31 March 2021 the Company expects to still hold a robust working capital position.

The assumptions underlying ongoing exploration and corporate costs are subject to change and are provided for guidance only.

Furthermore, should there be additional receipts of warrant monies the Company would be in an increasingly strong financial position and able to further accelerate project activities if deemed appropriate.

WARRANT UPDATE

On 10 December 2019 Power Metal announced an Equity Placing and Subscription which included the grant of 175,000,000 warrants exercisable at a price of at 0.70p per new ordinary share of 0.1 pence each in the Company with an exercise period ending on 10 December 2021, (the 'Financing Warrants').

The Financing Warrants were subject to an acceleration clause whereby should the volume weighted average share price ('VWAP') exceed 2.25p for 10 consecutive trading days, the Company may write to warrant holders providing 10 working days' notice of accelerated exercise, with 15 working days thereafter for payment.

The Company can confirm that in the 10 consecutive trading day period of 24 December 2020 to 11 January 2021 the Power Metal VWAP exceeded 2.25p and therefore the Company has the right to accelerate any unexercised Financing Warrants.

For the avoidance of doubt Power Metal is not at this time proposing to utilise the above acceleration clause.

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.

Contact:

Paul Johnson

Tel: +44 (0) 7766 465 617

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 the subject of 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.

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