ASX Suspension Looms as Lithium Energy Shelves Graphite IPO Amid Market Headwinds

Capricorn Project Acquisition and Exploration Momentum

Lithium Energy Limited (ASX, LEL) has completed the first tranche acquisition, securing a 51% interest in the Capricorn Gold-Copper Belt Project tenements in central Queensland. This district-scale project surrounds the historic Mt Morgan gold mine, a prolific producer of gold and copper. The company is actively reviewing an extensive 60-year geological database and historical drill cores, including promising re-assays revealing copper grades up to 3.22% and molybdenum at 252ppm at the Bajool Prospect.

Supported by a $250,000 grant from the Queensland Government’s Collaborative Exploration Initiative, Lithium Energy plans to deploy advanced 3D geophysical surveys, including Direct Current Induced Polarisation and Magnetotelluric methods, to better delineate porphyry copper-molybdenum mineralisation. These modern techniques aim to refine drill targets and unlock the potential of this underexplored region.

White Plains Lithium Brine Project Shows Early Promise

In the United States, Lithium Energy has staked 6,870 hectares of mineral claims in Utah’s White Plains area, a region with established lithium and potash activity. The company completed passive seismic surveys across 38 kilometres, revealing a half graben basin structure with basement depths up to 600 metres, an encouraging sign for lithium brine potential.

Complementary shallow brine sampling and Magnetotelluric surveys have been conducted, with assay results pending. These geophysical and geochemical investigations form the foundation for defining future drill targets in this mining-friendly jurisdiction.

Solaroz Sale Delivers Significant Cash Inflow

Lithium Energy has received US$26 million (~A$40 million) from the first tranche of its sale of a 90% interest in the Solaroz Lithium Brine Project in Argentina. The total sale price is US$63 million (~A$97 million), with the second tranche, including the remaining 50.1% shareholding transfer, scheduled for completion in January 2026. This transaction provides a substantial capital boost, underpinning Lithium Energy’s exploration and development ambitions.

Graphite Spin-Out Plans Put on Hold

In a strategic pivot, Lithium Energy and NOVONIX Limited have decided not to proceed with the proposed IPO spin-out of their combined high-grade graphite assets via Axon Graphite Limited. Prevailing market conditions and consultations with the lead manager influenced this decision. Lithium Energy is now exploring alternative pathways to develop its Burke and Corella graphite projects in Queensland, which have demonstrated strong metallurgical test results and significant mineral resources.

ASX Suspension and Path to Reinstatement

The company remains suspended from trading on the ASX due to insufficient operational activity following the Solaroz sale. Lithium Energy is actively engaging with the exchange and focusing on building a sufficient operational base through its new project acquisitions and exploration programs to satisfy reinstatement criteria. The Capricorn and White Plains projects are central to this strategy.

Financially, Lithium Energy reported a net cash inflow from investing activities driven by Solaroz sale proceeds, offset by operating cash outflows related to exploration and corporate expenses. The company ended the quarter with a robust cash balance of A$43 million, providing a solid runway for ongoing activities.