Why has the WA1 Resources share price exploded 1,200% in two weeks?

The junior explorer exited a trading halt yesterday, after pointing to media coverage as potentially increasing the volume of trading in its shares.

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Key points
  • The WA1 Resources share price has rocketed higher in two weeks
  • The junior explorer reported intersecting significant yields of niobium at its West Arunta Project
  • The ASX miner lost ground yesterday, but shares are again charging higher today

The WA1 Resources Ltd (ASX: WA1) share price has been on fire over the past two weeks.

On Friday 21 October, shares in the ASX copper explorer closed at 14 cents. With WA1 Resources up another 25% today to $1.87, the share price is up an eye-popping 1,236% in just two weeks.

In other words, a $100 investment in the company two weeks ago would be worth $1,336 today.

Quite a performance for a junior explorer that only recently listed on the ASX, commencing trading on 8 February.

Here's what's been driving investor interest.

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Image source: Getty Images

WA1 Resources share price surges amid promising early drilling

The WA1 Resources share price got a huge lift on 26 October after the miner released the first drill results from its West Arunta Project in Western Australia.

The miner reported it had intersected mineralised carbonate with significant yields of niobium. Niobium is listed as a critical and strategic mineral for its vital role in global technology by Australia, the United States, the European Union, Japan and India.

The intersections came amongst the seven holes drilled as part of the explorer's maiden drill program.

Commenting on those results, WA1 Resources managing director Paul Savich said:

For our first hole at P2 to have intersected high-grade niobium mineralisation that remains open and with the highest grade at the end-of-hole (2m at 1.22% Nb2O5) along with elevated rare earth elements and phosphorus, is an exciting result.

Savich noted that ferroniobium metal (65% Nb) sells for US$45,000 per tonne.

The WA1 Resources share price closed up… wait for it… 418.5% higher on the day.

What happened next?

With shares continuing to surge over the following days, albeit at a slower pace, WA1 requested that its share be placed into a trading halt on Tuesday, 1 November, pending a market announcement.

That announcement, released after the closing bell on Wednesday in response to an ASX volume query, stated that WA1 was complying with the listing rules, and said its share price and volume moves could be due to "substantial recent media coverage" of the niobium discovery it reported at West Arunta.

The WA1 Resources share price went on a rollercoaster after the miner resumed trading after that release, initially rocketing 47% before closing the day down 25%.

As mentioned up top, WA1 shares are again leaping higher today, up 25% at the time of writing.

Motley Fool contributor Bernd Struben 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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