Krakatoa Resources share price explodes 95% on major discovery

Rare earths elements are in increasing demand as the world moves towards electrification.

| More on:
A woman's head literally explodes with goodness.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Krakatoa Resources shares are skyrocketing today
  • The ASX resource minnow has reported a significant REE discovery
  • The explorer has multiple other high priority targets within its Western Australia property

The Krakatoa Resources Ltd (ASX: KTA) share price is heading for the sky today, up 94.9% to 12 cents at the time of writing.

Shares in the ASX resource minnow were placed in a trading halt on Friday before market open "pending the announcement of material exploration results from its 100% owned Mt Clere REE Project".

REE, if you're not familiar, stands for rare earth elements. These are comprised of a group of 17 metals. Many REEs are critical components in gadgets like your smartphone, alongside high-tech military hardware, modern vehicles, and much more.

Below we look at the exploration results, released this morning, that are sending the Krakatoa share price soaring.

What exploration results were announced?

The Krakatoa Resources share price is rocketing after the ASX resource explorer reported it's discovered "widespread clay hosted ionic type REE in the regolith" at its Mt Clere project in Western Australia.

The initial batch of drill results, taken at the Tower prospect, indicate high levels of regolith-hosted REEs. According to the release, these include significant enrichment in the magnetic elements, concentrated in the clay saprolite profiles.

Commenting on the initial results, Krakatoa's CEO Mark Major said:

These results have now confirmed that widespread clay hosted, ready soluble REEs exist at significant concentrations within the thick saprolite regolith of the Mt Clere project…

Demand for these magnetic and critical REEs are expected to increase over the next ten years, as the world embarks on the electric revolution. We are now in a strong position to capitalise on this potential as we have only covered a six square kilometre area, mineralisation is open, thick and close to surface.

Investors could also be bidding up the Krakatoa Resources share price today on the potential of other juicy REE targets within its property.

"Significantly, we have multiple other high priority targets within the extensive 2,300 square kilometre property," Major said.

The company is still awaiting results for 18 more drill holes at its Tower Prospects. It intends to fast track a comprehensive infill and extensional drill program at Tower Prospect, along with reconnaissance drilling of other "highly prospective areas".

Krakatoa Resources share price snapshot

With today's intraday gains factored in, the Krakatoa Resources share price is up 130% in 2022. That compares to a year-to-date loss of 2% posted by the All Ordinaries Index (ASX: XAO).

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Gainers

A young women pumps her fists in excitement after seeing some good news on her laptop.
Share Gainers

Why Adore Beauty, Domino's, DroneShield, and Universal Store shares are rising today

Not all shares are falling today. Why are these rising?

Read more »

Lion roaring in the wild, symbolising a rising Liontown share price.
Share Gainers

Here are the top 10 ASX 200 shares today

ASX investors once again pulled back from record highs today.

Read more »

Cheerful boyfriend showing mobile phone to girlfriend in dining room. They are spending leisure time together at home and planning their financial future.
Share Gainers

Why Accent, Dusk, Evolution Mining, and Zip shares are pushing higher today

These shares are having a great session. But why?

Read more »

Hands reaching high for a trophy with a sunset in the background.
Share Gainers

Here are the top 10 ASX 200 shares today

It was another day and another record high for ASX shares this Wednesday.

Read more »

Woman looks amazed and shocked as she looks at her laptop.
Gold

Have you heard of this ASX gold stock? It's up 114% in 8 days!

Investors have sent the ASX gold stock flying higher in July. But why?

Read more »

A woman with strawberry blonde hair has a huge smile on her face and fist pumps the air having seen good news on her phone.
Share Gainers

Why Cettire, Core Lithium, Northern Star, and Step One shares are charging higher

These shares are having a good time on hump day. But why?

Read more »

A woman's hand draws a stylised 'Top Ten' on a projected surface.
Share Gainers

Here are the top 10 ASX 200 shares today

It was back to earth for ASX investors this Tuesday.

Read more »

A man sees some good news on his phone and gives a little cheer.
Share Gainers

Why EOS, Hub24, Integrated Research, and Kingsgate shares are pushing higher

These shares are having a strong session. But why?

Read more »