Lithium Energy Ltd (ASX:LEL) and NOVONIX Ltd welcome an updated mineral resource estimate (MRE) for the Mt Dromedary graphite deposit which will be a key component of the proposed spin-out, Initial Public Offering (IPO) and ASX listing of Axon Graphite Limited.
The new company will encompass the northwest Queensland high-grade natural graphite assets of Lithium Energy (Burke and Corella deposits) and NOVONIX (Mt Dromedary) to form a distinct vertically integrated Battery Anode Material (BAM) business.
READ: Lithium Energy & NOVONIX to proceed with merger of Queensland graphite assets ahead of Axon IPO
Updated MRE
As part of the IPO process, Axon Graphite has reviewed the Mt Dromedary deposit which resulted in an updated MRE of 12.7 million tonnes at 14.5% Total Graphitic Carbon (TGC) for a total of 1.83 million tonnes of contained graphite at a 5% TGC cut-off.
Within this is an indicated resource of 8.3 million tonnes at 15.2% for 1.26 million tonnes of contained graphite and an inferred resource of 4.3 million tonnes at 13.2% TGC for 570,000 tonnes.
It also includes a higher-grade total resource of 8.5 million tonnes at 18.4% TGC for 1.56 million tonnes of contained graphite at a 10% TGC cut-off grade.
Revised cut-off
The review resulted in a 5% TGC cut-off grade for the updated MRE, which is now consistent with the 5% TGC cut-off grade adopted for the Burke and Corella MREs.
Also assisting Axon Graphite in providing accurate comparisons between the Lithium Energy and NOVONIX assets is that the Competent Person who assessed the updated Mt Dromedary MRE also assessed the Burke and Corella MREs in 2023.
Location of Burke Mt Dromedary and Corella graphite projects.
The review of Mt Dromedary will assist the new company in its post-IPO/listing resource development work.
Adjoining deposits
Mt Dromedary directly adjoins the Burke tenement with the latter being a continuation of the graphite mineralisation within Mt Dromedary.
Burke and Mt Dromedary deposits comprise resources of graphite with average (>14% TGC) grades significantly higher than most global peers.
Combining the two adjoining high-grade deposits creates the potential for significant operational synergies and economies of scale through a potentially larger scale open-pit mining operation to provide graphite feedstock for a vertically integrated BAM Facility based in Queensland.
In addition, mineralisation is open to the north and south and in between the currently defined Mt Dromedary and Burke deposits.
READ: Lithium Energy finalises board selection for Axon Graphite Limited spin-off
Work plans
Upon completing the IPO and being admitted to the ASX, Axon Graphite intends to review existing drilling data and resource models for the Burke and Mt Dromedary deposits to delineate a combined MRE.
It also plans to undertake resource development drilling on the tenements in a bid to increase and upgrade the combined resource.
Upon listing the new company will hold an interest in three high-grade deposits in Queensland with a combined contained graphite inventory of 4.42 million tonnes along with access to key infrastructure, including ports and transport links facilitating potential future export to major international markets.
The Burke Deposit of Lithium Energy has a JORC indicated and inferred resource of 9.1 million tonnes at 14.4% TGC, for 1.31 million tonnes of contained graphite and the Corella Deposit has a JORC inferred resource of 13.5 million tonnes at 9.5% TGC for 1.28 million tonnes.