ASX mining share FYI Resources Ltd (ASX: FYI) is having a day to forget.
The small-cap mining stock closed on Friday at 16 cents per share before entering a trading halt pending an announcement.
On making that announcement and exiting the trading halt today, the FYI Resources share price plunged 64%. Shares are currently trading for 5.8 cents apiece.
Here's what's happening.
Why are investors selling off the ASX mining share today?
FYI Resources is under heavy selling pressure after the company reported that Alcoa of Australia Limited (a subsidiary of Alcoa Corporation, the world's eighth-largest producer of aluminium) has withdrawn as a project partner for FYI's high purity alumina (HPA) development strategy.
FYI affirmed its committed to progressing the HPA project development and said it would now resume control of its HPA production plans.
In 2021, Alcoa of Australia executed a binding term sheet with the ASX mining share to jointly develop HPA production. Alcoa pitched in some US$5 million for the stage one development activities.
With Alcoa now stepping aside, FYI will retain joint access to all HPA project IP, data and information, assets, and customer relationships developed during the project.
Commenting on the development sending the ASX mining share plunging today, FYI Resources managing director Roland Hill said:
While this is not the outcome we envisaged, the HPA project has advanced considerably, benefitting from Alcoa's rigour and US$5 million investment. FYI recognises the value proposition of the strategy and views regaining control and management of the project as an opportunity.
Looking ahead, Hill added, "FYI intends to adopt a project schedule with emphasis on an accelerated timelier approach to development. We have a highly experienced team that can move the project forward."
The company said it is "adequately funded" with just over $10 million in treasury to continue its small-scale production and demonstration development work.
FYI Resources share price snapshot
As you can see in the chart below, the FYI Resources share price was solidly in the green for 2023…until today.
With the big intraday fall factored in, the ASX mining share is now down 59% year to date.
