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Lithium Energy Ltd (ASX:LEL) and NOVONIX Ltd have announced an updated Mineral Resource Estimate (MRE) for the Mt Dromedary graphite deposit, which will play a central role in the planned spin-out, Initial Public Offering (IPO), and ASX listing of Axon Graphite Limited.
The new entity, Axon Graphite, will integrate high-grade natural graphite assets from northwest Queensland, including Lithium Energy's Burke and Corella deposits, along with NOVONIX's Mt Dromedary deposit. This consolidation aims to create a vertically integrated Battery Anode Material (BAM) business focused on sustainable and efficient graphite production.
Updated Mineral Resource Estimate
As part of the IPO process, Axon Graphite has reviewed the Mt Dromedary deposit, resulting in an updated MRE of 12.7 million tonnes at 14.5% Total Graphitic Carbon (TGC), equating to 1.83 million tonnes of contained graphite, based on a 5% TGC cut-off. This resource includes an indicated resource of 8.3 million tonnes at 15.2% TGC, yielding 1.26 million tonnes of graphite, and an inferred resource of 4.3 million tonnes at 13.2% TGC, yielding 570,000 tonnes.
Additionally, the MRE includes a higher-grade total resource of 8.5 million tonnes at 18.4% TGC, translating to 1.56 million tonnes of contained graphite, based on a 10% TGC cut-off grade. The 5% TGC cut-off grade aligns with the criteria used for the Burke and Corella MREs, allowing for a standardized comparison between Lithium Energy and NOVONIX's assets.
The same Competent Person who assessed the updated Mt Dromedary MRE in 2023 also evaluated the Burke and Corella MREs, ensuring consistency and accuracy in the resource estimates across these adjoining projects.
Strategic Alignment and Future Plans
The review of the Mt Dromedary resource is expected to support Axon Graphite's post-IPO and listing resource development plans. The Mt Dromedary deposit is directly adjacent to the Burke tenement, which shares a continuation of the graphite mineralization. Both deposits feature high average grades of over 14% TGC, significantly exceeding those of many global peers. This proximity provides an opportunity for operational synergies and economies of scale, potentially enabling a larger-scale open-pit mining operation to supply graphite feedstock to a vertically integrated BAM facility in Queensland.
Furthermore, the mineralization at both the Mt Dromedary and Burke deposits remains open to the north, south, and between the currently defined areas, suggesting additional exploration potential.
Next Steps for Axon Graphite
Upon the completion of the IPO and ASX listing, Axon Graphite plans to review the existing drilling data and resource models for the Burke and Mt Dromedary deposits to establish a combined MRE. Resource development drilling is also planned to enhance and potentially increase the combined resource estimates.
The newly listed company will hold interests in three high-grade graphite deposits in Queensland, with a combined contained graphite inventory of 4.42 million tonnes. It will also benefit from access to key infrastructure, such as ports and transport links, which will facilitate future exports to major international markets.
The Burke Deposit, part of Lithium Energy's portfolio, has a JORC-compliant indicated and inferred resource of 9.1 million tonnes at 14.4% TGC, containing 1.31 million tonnes of graphite. The Corella Deposit holds a JORC-compliant inferred resource of 13.5 million tonnes at 9.5% TGC, with 1.28 million tonnes of contained graphite.
These resources position Axon Graphite well for future development and expansion within the battery materials sector, as the company aims to capitalize on growing demand for high-quality graphite in global markets.
