Resources Top 5: A $4.5m state investment will help Ark take big steps at Sandy Mitchell project

• AHK will benefit from state funds to support businesses across the critical minerals supply chain
• LKY has launched a value-adding downstream strategy to maximise the potential of antimony from its Californian project
• A placement to new and existing investors has raised $3.27 million for BMM

Your standout small cap resources stocks for Monday, August 25, 2025

Ark Mines (ASX:AHK)

A $4.5m investment from the Queensland government has provided a boost for Ark Mines (ASX:AHK) and its Sandy Mitchell rare earths and heavy mineral sands project with shares climbing to a 3-year high of 40c, a lift of 117% on the previous close.

The funds were provided by the QIC Critical Minerals and Battery Technology Fund (QCMBTF), which is intended to support businesses across the critical minerals supply chain in Queensland.

It is managed by state government-owned corporation Queensland Investment Corporation (QIC), which has $131.2bn in funds under management.

Ark Mines (ASX:AHK) will use the funds, which comprise $4m in upfront funding tied to royalties based on future product sales from Sandy Mitchell and a $500,000 equity investment to accelerate development at the project 230km northwest of Cairns.

The investment follows collaborative due diligence between the parties and reflects the state’s commitment to providing support for Queensland-based resources projects.

The funding is in line with the government’s strategy to strengthen domestic supply chains for critical minerals, with expectations for ~80 local jobs to be created when Sandy Mitchell begins production.

QIC senior investment director Jonathan Crombie said the project had the potential to be a strategically significant, long-life asset producing essential rare earth elements outside of Asia.

Securing sustainable supplies of REEs is a strategic priority for governments and industries globally due to the accelerating transition to net zero, this is especially urgent due to recent export restrictions.

Sandy Mitchell has a high confidence measured resource of 71.8Mt at 1732.7ppm monazite – a mineral containing REEs – equivalent.

There is potential for exploration to deliver scale that could place it in a similar ballpark as Red Metal’s (ASX:RDM) Sybella project in northwest Queensland given the exploration target of 1.3 billion to 1.5 billion tonnes at 1,286 to 1,903 ppm MzEq.

A scoping study has placed a $120-150m cost on a development underpinned by the current measured resource. This is expected to generate annual EBITDA of $45m-$53m and annual post-tax-free cash flow totalling ~$25m-30m.

Locksley Resources (ASX:LKY)

Adopting a value-adding downstream strategy to maximise the potential of high-grade antimony from its Mojave project in California has seen Locksley Resources (ASX:LKY) hit a record 33c, a 47% increase on the pre-trading halt close with 63.5 million shares exchanged.

Locksley has partnered with Rice University, a global leader in materials science, nanotechnology and energy innovation, to formally launch its US-focused downstream innovation strategy.

Rice University has proven critical minerals capability as evidenced through a collaboration with Metallium (ASX:MTM) on its Flash Joule Heating technology.

Under the dual initiative agreement, Locksley and Rice will focus on antimony processing and utilisation to accelerate “mine-to-market” deployment of transformative, American made technology.

Material will be sourced from the Mojave project, which includes the historical Desert Antimony mine and neighbours Mountain Pass, the only producing rare earths mine in the US.

“This strategic collaboration with Rice University, which has been formalised in a legally binding Sponsored Research and Development Agreement, marks a pivotal step in executing Locksley’s US strategy,” chairman Nathan Lude said.

“As a first mover advantage strategy, we are rapidly advancing our upstream strategy, whilst working to build out a downstream capability through materials innovation, which is what America urgently requires.”

Under the first thrust, the parties will examine clean, green hydrometallurgical extraction of antimony from mining feedstocks.

This includes the development and testing of low energy, environmentally benign solvent extraction processes for antimony ores and concentrates from Mojave and other US sources.

The work will support the re-establishment of US based antimony processing capacity, which is non-existent despite rising strategic demand.

LKY and Rice will also explore the use of antimony based materials for energy storage applications.

Applied research will be carried out on advanced electrode materials and composite architectures for lithium-ion and sodium-ion batteries, supercapacitors and hybrid power modules using antimony as a core component.

“Fast-tracking these two research thrusts through Rice University, allows us to unlock value from our Mojave asset and play a direct role in sovereign independence of the US defense, energy and AI infrastructure sectors,” Lude added.

Antimony is recognised as a critical mineral due to its uses in producing ammunition, explosives, propellant, armoured vehicles, missile and electronic components and flame-retardant materials.

Bayan Mining and Minerals (ASX:BMM)

Investors have shown great confidence in Bayan Mining and Minerals (ASX:BMM) and its Californian gold and critical minerals strategy with strong support for a placement.

The placement to new and existing investors raised $3.27 million at 20 cents a share, representing a 47.8% premium to the 15-day VWAP.

BMM reached a two-year high of 26.5, an increase of 26.83% on the previous close.

Funds will help the company step up exploration efforts at the Desert Star and Desert Star North projects. 

BMM director Fadi Diab said the company was well positioned to define and advance high-priority targets following the completion of sampling. 

“The strategic location of our projects, within close proximity to MP Materials’ world-class Mountain Pass rare earth mine and Dateline Resources’ Colosseum gold mine, highlights the exceptional potential of our ground,” he said. 

“This funding allows us to rapidly progress exploration in a district that is both geologically proven and strategically important to the North American critical minerals supply chain.”

Terra Uranium (ASX:T92)

Terra Uranium (ASX:T92) has expanded its agreement with Axiom Group to source rare earth elements and antimony assets across the USA.

Axiom has a significant North American presence and has been heavily involved in the REE and antimony sectors, providing geological field and mineral exploration services.

“We are looking forward to providing continued support to Terra, as it expands its presence across the USA,” Axiom Group president and CEO Doug Engdahl said. 

“We feel that we have the right team, technical expertise, resources and presence to assist Terra to drive its US critical minerals strategy.”

“We are seeing a truly fundamental shift in how America secures critical minerals. The recent move by the Trump administration to allocate $2Bn from the CHIPS Act to fund mining projects, is a further sign that the moneyflow is set to continue,” T92 director Niv Dagan said.

“We are now seeing both government and private investment backing at a level that hasn’t been seen before, where governments are taking equity stakes in some of the world’s largest companies.”

Lakes Blue Energy (ASX:LKO)

Significant progress has been made since drilling resumed on August 22 at the Wombat-5 Well in Victoria’s Gippsland Basin and Lakes Blue Energy (ASX:LKO) shares increased 29.29% to $1.17.

As at 8am AEST today, the side-track-2 well had reached 1100 metres below the rotary table (RT) in an 8 and a half inch hole and in 72 hours the drilling progressed 630m.

Drilling resumed from above the cement plug that was set at 470 mRT and the drilling target formation depth is 1,360m RT in the Strzelecki Formation.

The resumption of drilling came after the company and the contractor reached agreement on a go-forward arrangement aimed at preventing recurrence of mud circulation problems. 

This agreement involves, among other things, building of substantial redundancy into the drilling system as well as additional processes to mitigate the chance of a reoccurrence of the circulation issue. 

The contractor also offered, and the company accepted, a fixed price arrangement for completion of drilling of the well.