AXP Energy Raises $1.25M to Power Modular Data Centre Expansion

Capital Raise to Fuel Growth

AXP Energy Limited (ASX: AXP) announced firm commitments to raise $1.25 million through a two-tranche placement of approximately 833 million shares at $0.0015 each. Notably, this price represents a 9.2% premium to the recent 15-day volume weighted average price, signaling investor confidence in the company’s strategic direction. Directors have also pledged $165,000 towards the raise, pending shareholder approval.

The funds will primarily support the expansion of AXP’s modular data centre (MDC) operations, which are powered by stranded natural gas from the company’s 100%-owned Pathfinder Field in Colorado. This capital injection marks AXP’s first placement since November 2020, underscoring a renewed momentum in its growth trajectory.

Innovative Use of Stranded Gas

AXP’s core innovation lies in repurposing stranded natural gas reserves to generate off-grid power for data centres focused on high-performance computing tasks such as Bitcoin mining, artificial intelligence, and rendering. The company’s initial MDCs have been established at the Pathfinder #2 well site under a joint development agreement with Blackhart Technologies, which is already utilizing the gas-to-power setup for Bitcoin mining operations.

With at least 24 ready-to-connect oil and gas wells in the Pathfinder Field, AXP is well-positioned to scale its operations. The company is also evaluating expansion beyond the first three sites, aiming to commercialize Pathfinder’s substantial 2C gas resources estimated at 744 billion cubic feet.

Strategic Outlook and Market Potential

Chairman Sam Jarvis expressed optimism about the progress, highlighting the importance of demonstrating the reliability of the gas-to-power-data centre model. He emphasized the growing demand for off-grid power solutions among data centre operators in North America, a trend that AXP is poised to capitalize on.

The placement proceeds will also bolster working capital, providing the company with financial flexibility as it navigates the early stages of commercializing its energy assets. The successful integration of modular data centres with stranded gas power generation could position AXP as a niche player in the intersection of energy and high-performance computing infrastructure.

Next Steps and Market Implications

Following the placement, AXP’s total shares on issue will increase to approximately 6.66 billion, with broker options also issued as part of the capital raising process. The company has lifted its trading halt and expects the new shares to commence trading by 10 February 2025.

Investors will be watching closely for updates on the operational performance of the Pathfinder sites and the company’s ability to scale its modular data centre footprint. The success of this capital raise and subsequent execution could serve as a bellwether for similar energy-to-data centre ventures leveraging stranded resources.