The Peak Resources Ltd. (ASX: PEK) share price was placed in a trading halt at the commencement of trade today.
Prior to the announcement, Peak shares finished yesterday 2% in the red from the previous close at 9.1 cents.
Let's take a look at what the announcement entails.
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A quick recall on Peak Resources
Peak Resources is in the business of exploration and evaluation of mineral licences.
Its primary focus is on the production of rare earth elements. These are used in the production of low-carbon technology, like electric vehicles and wind turbines.
Peak's focus on rare earths is concentrated in a project located in southern Tanzania.
At the time of writing, Peak has a market capitalisation of $148 million.
What did Peak announce today?
ASX Ltd confirmed Peak's request for a trading halt in an announcement this morning. It stated:
Unless the ASX decides otherwise, the [Peak Resources] securities will remain in trading halt until the earlier of the commencement of normal trading on Friday, 23 July 2021, or when the announcement is released to the market".
Peak stated its request for the trading halt stems from an update on the special mining licence at its Ngualla Rare Earth project in Tanzania.
The Ngualla project is based on one of the largest and highest grade undeveloped neodymium praseodymium (NdPr) deposits in the world.
Peak has held ongoing discussions with the Tanzanian Minister for minerals as to the progress of its special mining application over the past 18 months.
From the release, investors can expect movement in this story over the next two days.
Regarding the project, Peak Resources managing director, Bardin Davis stated in a report from Mining Technology on 14 July:
It [Ngualla] has ore reserves with a grade of 4.8% that support an initial mine life of 26 years. The intention is to produce a high grade concentrate at Ngualla with a rare earth oxide grade of around 45%, which will then be shipped to our Teesside Rare Earth Refinery in the UK.
Today's pause marks the fourth trading halt for the company in the last 18 months. At least two of these halts are directly related to developments in the Ngualla story.
As mentioned by ASX, investors can expect the halt to remain until this Friday at the latest.
Peak Resources share price snapshot
The Peak Resources share price has posted a year to date return of 36%, extending the previous 12 month's return of 314%.
These returns have outpaced the S&P / ASX 200 Index (ASX: XJO)'s return of ~20% over the previous year.
