Lithium Energy Ltd (ASX:LEL) has completed the first tranche acquisition of a 51% interest in the Capricorn Gold-Copper Belt Project (Capricorn Project) in central Queensland. The company retains the right to acquire the remaining 49% interest within 21 months, with the final deadline set for April 2027.
The Capricorn Project comprises 1,795 square kilometres of contiguous exploration tenure at both granted and application stages. The tenements are adjacent to and surrounding the historic Mt Morgan Gold Mine and contain multiple targets for gold, copper, molybdenum and zinc. Significantly, the area includes more than 30 kilometres of strike length of the Middle Devonian-aged Mt Morgan Intrusive Complex, interpreted as the source of mineralisation at Mt Morgan. Despite the presence of historic datasets, the region has seen minimal exploration activity since the 1990s.
Capricorn Gold-Copper Belt Project Tenements.
A key target within the Capricorn Project is the Bajool prospect, located in exploration permit EPM 27097. Hosted by the Bajool Intrusive Complex (BIC), this area is considered prospective for a significant porphyry copper-molybdenum system. Historic diamond drill hole D28-DDH4 at Limonite Hill, recently re-logged and assayed by Lithium Energy, returned encouraging results:
- 16 metres at 0.57% copper and 441 parts per million molybdenum from 156 metres depth (using a 100 ppm molybdenum cut-off), including: 2 metres at 3.22% copper, 252 ppm molybdenum and 17.7 ppm silver from 160 metres depth.
Lithium Energy has also secured A$189,200 in Queensland Government exploration funding and plans an extensive geophysical and drilling program to test for large-scale mineral systems.
Location Map of Capricorn Gold-Copper Belt Project showing Bajool Prospect (containing the Limonite Hill mineral occurrence) and geological settings.
Tranche 1 acquisition details
The acquisition is governed by two asset sale agreements signed on March 12, 2025:
- One with GBM Resources Ltd (ASX:GBZ) for the transfer of six exploration and mining licences (EPM 17850, EPM 27096, EPM 27097, EPM 27098, EPM 27865, and MDL 2020) and mining data; and
- Another with PTr Resources Pty Ltd, covering four tenements (EPM 28156, EPM 28130, EPM 29040 and EPM 29065) and related data.
Under the staged agreement structure:
- Tranche 1, completed on 11 July 2025, included the transfer of a 51% stake in all GBZ and PTr tenements and 100% of the mining information.
- Tranche 2, to transfer the remaining 49%, is expected to be completed by April 2027, subject to key conditions.
Consideration and expenditure
Lithium Energy has paid a A$100,000 deposit and A$600,000 Tranche 1 completion payment to the vendors, with a further A$2.325 million payable in two stages:
- A$825,290 deferred payment due nine months post-completion (April 2026); and
- A$1.5 million Tranche 2 payment due upon final completion.
Additional obligations include:
- Contingent milestone payments of A$2.5 million, tied to JORC resource declarations and feasibility outcomes;
- A 2.5% net smelter return royalty under a separate Royalty Deed; and
- Minimum project expenditure of A$4 million prior to Tranche 2 completion.
Completion conditions for Tranche 2
Final completion is conditional on:
- Renewal of GBZ’s EPM 17850 and EPM 27096;
- Granting and partial transfer of EPM 27856 and MDL 2020 (GBZ tenements);
- Granting and partial transfer of EPM 29040 and EPM 29056 (PTr tenements); and
- Completion of the A$4 million minimum spend — unless Lithium Energy elects to fast-track the process via early payment of the A$1.5 million Tranche 2 consideration.
Capricorn Project surrounds historic Mt Morgan gold mine
The Capricorn Gold-Copper Belt Project tenements in central Queensland surround the historic Mt Morgan gold mine, which operated from 1883 to 1981 and produced approximately 50 million tonnes (Mt) of ore at 4.99 grams per tonne (g/t) gold and 0.72% copper, yielding 7.65 million ounces of gold, 1.2 million ounces of silver and 360,000 tonnes (t) of copper. While the Mt Morgan Mine itself does not form part of the Capricorn Project, Lithium Energy intends to test for repetitions of Mt Morgan-style mineralisation along strike within the project area.
The project hosts multiple targets for gold, copper, molybdenum and zinc across more than 30 kilometres of strike length of the Middle Devonian-aged Mt Morgan Intrusive Complex — the interpreted source of Mt Morgan's gold and copper mineralisation. Despite the presence of historical geological, geochemical and geophysical datasets, exploration across the tenements has been limited since the 1990s.
Lithium Energy plans to leverage modern geological interpretations, advanced geophysical and electrical survey techniques, and consolidated historical datasets to conduct a comprehensive exploration campaign. The program will incorporate modern geophysics, including advanced three-dimensional analytics, to interpret both historical and newly acquired data. These insights will guide a targeted drilling campaign across priority zones prospective for large-scale mineralised systems, including Mt Morgan-style gold, copper-molybdenum and copper-gold porphyry, as well as volcanic massive sulphide (VMS) mineralisation.