Elixir Energy locks in $10M R&D-backed debt facility ahead of high-impact Lorelle-3 well Proactive uses images sourced from Shutterstock

Elixir Energy Ltd (ASX:EXR, OTC:ELXPF) has secured a debt facility of up to $10 million from Endpoints Capital to forward-fund the R&D tax component of its upcoming Lorelle-3 appraisal well in Queensland's Taroom Trough — giving the company a working capital buffer during what shapes up as a pivotal operational period.

The Lorelle-3 well, located in ATP2056 within the Taroom Trough, is considered a high-impact appraisal target for Elixir as it looks to advance its Queensland gas ambitions. The company recently completed drilling at Lorelle-3, reaching a final depth of 3,580 metres measured depth below rotary table — and intersecting multiple Permian hydrocarbon reservoir targets along the way. The confirmation of total depth marked a key operational milestone for the company, with attention now turning to evaluation of the intersected intervals.

Exploration refund

The facility is structured around Elixir's Advance Finding from AusIndustry under the Federal Government's R&D Tax Incentive program, which was awarded in November 2025 and covers a three-year window from FY26 to FY28. Under that finding, up to 48.5% of eligible costs tied to the Lorelle-3 program — spanning drilling, coring, logging, analysis, completion and testing — qualify for a refund through the company's tax return.

Endpoints Capital's facility allows Elixir to draw down up to 80% of its estimated FY26 R&D tax refund ahead of actually receiving it, smoothing out the cash flow gap that comes with major well expenditure. With virtually all significant Lorelle-3 spending expected to land before 30 June 2026, the timing makes the facility a practical necessity rather than a luxury.

The terms are straightforward: a 1% drawdown fee, a 15.75% interest rate that capitalises until repayment, and a hard repayment deadline of the earlier of 28 February 2027 or receipt of the R&D refund. Notably, the facility carries no warrants, options or equity instruments attached — meaning existing shareholders face no dilution.

“Successfully applying for the AusIndustry Advance Finding and the prequalification of the Lorelle-3 appraisal campaign, gives Elixir the security required in order to be able to borrow against its future R&D refund. With the drilling and testing of Lorelle-3, the completion and testing of Diona-1 and the Teelba 2D seismic campaign all occurring in the first six-months of this year, this facility will give Elixir the balance sheet flexibility to ensure it is well capitalised between now and when the R&D refund is received as part of the company’s annual tax return process.”



Lorelle-3 well hits 148 metres of net pay across four Permian reservoirs

Elixir recently delivered a significant early result from its Lorelle-3 appraisal well in ATP 2056, Queensland's Taroom Trough, with wireline logging and an expanded evaluation campaign confirming multiple hydrocarbon-bearing intervals across the Permian section.

The headline number is 148 metres of net pay spread across four distinct reservoir intervals — a result that points to the kind of stacked pay potential that makes the Taroom Trough an increasingly watched address for gas explorers.

Breaking down the results by formation, the Lorelle Sandstone was the standout contributor with 60 metres of net pay and porosity reaching up to 14%, while the Kianga Group sandstones added 59 metres of net pay across six separate zones with the best porosity readings of the well at up to 17%. The Tinowon "Dunk" Sandstone delivered 28 metres of net pay with porosity up to 13%, rounding out a solid trio of meaningful contributors. The Overston Sandstone chipped in a further 1 metre of net pay at up to 9% porosity.

The stacked nature of the pay across four reservoirs within the Permian section is likely to be the key talking point for investors, suggesting Lorelle-3 is encountering a stratigraphic sequence with genuine reservoir quality rather than isolated pockets of hydrocarbons. Further evaluation of the well is expected to build on these initial findings.