The Ragusa Minerals Ltd (ASX: RAS) share price is having a day to forget.
In morning trade, the lithium explorer's shares crashed as much as 42% to 10.5 cents.
The Ragusa Minerals share price has since recovered a touch but remains down 22% at 14 cents.
Why is this lithium share crashing?
Investors have been hitting the sell button today after the company released an update on the NT Lithium Project located approximately 120km south of Darwin.
According to the release, the company has completed a total of 18 reverse circulation drillholes comprising a total of 1505 metres drilled. From these 18 drillholes, Ragusa revealed that 12 intersected pegmatite.
Select pegmatite drill samples have now been delivered to a laboratory for lithium analysis testing.
Ragusa chair, Jerko Zuvela, commented:
The Company is pleased to have conducted our maiden exploration drilling program at our strategic and highly prospective NT Lithium Project. We are very encouraged by the preliminary drilling observations at our priority targets, noting the scale of the pegmatite zones encountered within our project area. We look forward to receiving the lithium assay results in coming weeks.
The completion of the initial exploration program is another positive step that puts Ragusa in a strong position to rapidly accelerate the development of our project within a proven high-quality lithium district in a Tier 1 jurisdiction close to major infrastructure at a time of record lithium prices.
So what's wrong?
While the above sounds positive, the Ragusa Minerals share price performance today certainly paints a very different picture.
This appears to be down to management's comments on the drillholes. It notes that "geological staff identified additional samples containing visually significant levels of graphite in the hangingwall and footwall zones either side of some of the pegmatites."
There was no mention of visible lithium, which appears to have investors concerned that the NT Lithium Project could ultimately prove to be a dud.
They will have to sit tight and wait for the assay results to be received in the coming weeks.
