Why are Locksley Resources shares diving 17%?

The ASX mineral explorer released its quarterly activities report today.

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Key points

  • Locksley Resources shares dropped 17% to 34 cents following the release of its quarterly activities report, reflecting an ongoing correction after a dramatic rise of 3,959% year to date.
  • The report reveals $7.24 million in cash and advancements at the Mojave Project, including upcoming drill programs for rare earths and antimony, as well as collaborations with Rice University on processing innovations.
  • Recent achievements include commencing trading on US and Frankfurt markets, appointing new executive leadership, and successfully casting the first 100% US-made antimony ingot in decades, aligning with US strategic goals.

Locksley Resources Ltd (ASX: LKY) shares have tumbled 17% to 34 cents per share on Tuesday.

The steep fall for this ASX mineral explorer follows the release of the company's quarterly activities report this morning.

Locksley Resources shares have plunged in recent weeks after peaking at an all-time high of 69 cents on 22 September.

That historical high represented a stunning 3,959% skyrocketing over the year to date, and a 2,350% rise over 12 months.

Niv Dagan from Peak Asset Management recently warned of a likely period of profit-taking ahead after such stunning gains.

Let's take a look at the report.

Locksley Resources shares tank on quarterly update

Locksley Resources is a critical minerals explorer with drill-ready rare earths and antimony exploration projects in the US.

It also has a copper and gold exploration target called Tottenham in NSW, but nothing much is happening with it right now.

In terms of the financials, Locksley Resources reported cash of approximately $7.24 million at the end of the September quarter.

The explorer spent $875,000 on exploration and evaluations, as well as metallurgical test work for downstream processing.

Locksley Resources said it has 4.57 quarters worth of funding currently available.

Drilling to commence shortly

In terms of exploration activities, Locksley Resources said it achieved significant advancements at its flagship Mojave Project.

The project is located in California's Mojave Desert, in a Tier One area 1.4 km from Mountain Pass, the only active rare earths mine in the US.

The explorer said final preparations are now underway for two programs at Mojave.

They are the maiden drill program at El Campo (rare earths) and the expanded drill program at Desert Antimony (DAM).

Rare earths are used in wind turbines, electric cars, robotics, defence systems, and everyday technology products like smartphones.

Antimony is used to harden metals and is mixed in an alloy to make lead-acid batteries and bullets.

Locksley Resources also said it aggressively advanced its strategy to establish an independent US supply chain for antimony last quarter.

It is working with Rice University in Texas to develop a faster processing method for antimony called DeepSolv.

Locksley describes Deepsolv as an innovative green hydrometallurgical solvent system for extracting antimony from stibnite ores and concentrates.

The explorer and Rice are also investigating using antimony in next-generation energy storage systems.

Locksley Resources says its two research goals with Rice "directly align with U.S. energy and national security mandates".

What else happened during the quarter?

Locksley Resources began trading on the US OTCQX Best Market and Frankfurt Stock Exchange to raise its profile with investors.

The miner appointed CEO, Kerrie Matthews, and COO, Danny George, whose first priority is fast-tracking a mine-to-market strategy for antimony in the US.

Last week, Locksley Resources announced the successful casting of the first 100% US-made antimony ingot metal in decades.

The ingot was produced using concentrate sourced from non-Chinese feedstock and was processed entirely in the US.

Locksley Resources said:

This breakthrough demonstrated the technical feasibility of restoring antimony refinement in America for the first time in decades and provided a tangible foundation for future downstream processing and government engagement under the Defense Production Act and Inflation Reduction Act frameworks.

In terms of Tottenham in NSW, Locksley Resources said limited exploration activities occurred during the quarter due to its focus on Mojave.

The explorer is now carrying out a review to determine the best path forward for the project amid rising gold and copper prices.

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. 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 Scott Phillips.

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