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As the ASX All Ordinaries Index (ASX: XAO) pushes less than 1% into the green this past week, one All Ords stock continues its impressive run.
Shares in WA1 Resources Ltd (ASX: WA1) shares have skyrocketed 250% in the past 12 months and are up 52% this year.
They were valued at $18.84 per share before the open on Wednesday, right before the company requested a trading halt of its securities.
The reason? A market-sensitive announcement regarding an update at its Luni carbonatite asset, located in Western Australia. Let me explain.
Why is this ASX All Ords stock on ice?
WA1 Resources shares are frozen today after a company request before the market opened.
The ASX All Ords stock announced it has completed the initial mineral resources estimate (MRE) for its Luni asset, located within the company’s West Arunta Project in WA.
The Luni deposit has been identified as “the most significant niobium discovery in over 70 years”, according to WA1.
Niobium is a metal highly resistant to corrosion. Consequently, it is favoured in the production of various alloys, such as stainless steel.
The initial MRE for Luni showed an intersection of 200 million tonnes (Mt) at 1.0% Niobium (Nb2O5). Assays contained a high-grade subset of 53 Mt at 2.1% Nb2O5 as well.
This estimate is based on drilling completed up to the end of 2023. It will guide further resource definition drilling within the same vicinity for the ASX All Ord stock.
WA1 managing director Paul Savich emphasised the strategic importance of Luni, saying:
This mineral resource estimate confirms Luni as the most significant niobium discovery globally in over 70 years. This is a remarkable achievement within two years from discovery in an entirely greenfield belt in the West Arunta.
The shallow, high-grade nature of the deposit, coupled with the recently announced initial metallurgy results, indicates the deposit may be amenable to conventional processing techniques and reinforces Luni as a highly strategic critical mineral asset.
Brokers are optimistic
Aside from today’s update, metallurgical test work completed at Luni saw investors start a feeding frenzy for the ASX All Ords stock last month.
The program produced high-grade niobium concentrates that are comparable to industry recovery rates.
As a result, analysts at Bell Potter see a significant upside for this All Ords stock, saying WA1 passed “a significant de-risking hurdle” with the above results.
The broker also believes the Luni project could generate $514 million in annual pre-tax earnings, valuing the ASX All Ords stock at $5.6 billion.
It upgraded its price target on the company to $28.00, suggesting a potential upside of 48% at the time of writing.