The field is a multi-select and we just need to add more options, however the field is LOCKED and there is no way to add more values to the selection list. It seems pretty stupid to have to create a new field just to add another option. As this field will evolve over time, I do not fancy having to continually recreate it...
That padlock means it's a locked field. Whatever created it told Jira not to let anyone reconfigure it, so the usual path to add options (Issues > Custom fields > your field > Contexts and default value > Edit options) is greyed out or missing entirely.
Depends what owns it. If a Marketplace app created the field, that app controls the option list, so you'd add the new values inside the app's own config. Not in Jira's field screen. If Atlassian locked it (a system-managed field), you can't extend it at all, and rebuilding it as a new field is the way out. Same annoying outcome you're trying to avoid.
Can you check which it is? In Issues > Custom fields, find the field and see whether it says it's managed by an app, and which one. That decides whether you add your option in the app or have to rebuild it as a plain Select list (multiple choices) field you control.
Atlassian's page on this is titled the same as your question, by the way: what are locked custom fields.
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