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Novonix and Lithium Energy to Merge Graphite Units, Launch New Venture
Novonix and Lithium Energy to Merge Graphite Units, Launch New Venture

Novonix and Lithium Energy to Merge Graphite Units, Launch New Venture

  • 04-Apr-2024 3:21 PM
  • Journalist: Sasha Fernandes

On April 3rd, 2024, NOVONIX Limited, a prominent player in the battery materials and technology sector, disclosed the signing of a definitive agreement. As per the agreement, NOVONIX's wholly owned subsidiary, MD South Tenements Pty Ltd, holding the Mount Dromedary natural graphite exploration interests, will be divested to Axon Graphite Limited, a subsidiary of Lithium Energy Limited (ASX: LEL). Simultaneously, LEL will contribute its interest in its Burke and Corella graphite projects to Axon. In exchange for this transaction, NOVONIX will receive shares in Axon, with intentions to list Axon on the Australian Securities Exchange (ASX). However, the completion of the transaction is contingent upon the fulfillment of due diligence inquiries by both parties, the successful completion of the proposed initial public offering (IPO) of Axon, and the approval for Axon's admission to the ASX.

NOVONIX's Mt. Dromedary project represents a valuable high-grade natural flake graphite deposit, situated adjacent to LEL's Burke interests in northwest Queensland, approximately 125km north of Cloncurry. This location boasts access to a well-established mining region with connectivity to an export hub. Additionally, LEL's Corella interests are situated 40km west of Cloncurry. The envisioned activities of Axon encompass advancing the development of the Burke/Mt. Dromedary graphite projects, exploring and evaluating the Corella graphite project, advancing a vertically integrated Spherical Purified Graphite Battery Anode Material manufacturing facility in Queensland, and exploring potential projects in the battery minerals sector in Australia and internationally.

Dr. Chris Burns, CEO of NOVONIX, expressed optimism about the growth prospects in the electric vehicle and energy storage systems battery markets. He emphasized the belief that combining the Mt. Dromedary and Burke assets would enhance their scale and economics, laying the groundwork for a significant natural graphite mine and business development. Dr. Burns highlighted the formation of Axon as an opportunity to attract new capital and advance the production of highly refined natural graphite for electric vehicles and energy storage systems, underscoring its value for NOVONIX shareholders.

William Johnson, Executive Chairman of LEL, lauded the transaction involving the Mt. Dromedary and Burke Graphite Projects, recognizing it as a pivotal step toward consolidating two adjacent high-quality natural graphite deposits. He highlighted the vision of creating an Australian-based, vertically integrated battery anode material (BAM) business and anticipated significant operational synergies from the consolidation. Moreover, Johnson expressed satisfaction in having NOVONIX as a partner in Axon Graphite, citing NOVONIX's esteemed position in the global battery industry and its potential contribution to Axon's future endeavors.

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