The four-year-old company, known until recently as Queensland Energy & Minerals, is looking to raise A$5 million to explore three permits covering 176sq.km over part of the Toolebuc Formation that is recognised as one of the largest kerogen oil shale deposits in the world, but from which it has so far not proven economic to recover black gold.
The Early Cretaceous Toolebuc Formation consists of a lower kerogenous shale and an upper interbedded limestone-shale mix that has been subject of exploration since the 1960s, with Esso (now ExxonMobil) the first to confirm base metal anomalism at Julia Creek, with assays of vanadium, zinc, copper, nickel, uranium and molybdenum.
It is the vanadium that has attracted the most attention in recent years thanks to changes in battery storage technology.
QEM has its eyes firmly on both prizes, and completed a scoping study in June 2016 believing the opportunity exists for dual vanadium and kerogen oil shale project.
As part of its preparation for the planned initial public offer, QEM commissioned a resource upgrade, and believes it is sitting on an inferred 1.7 billion tonnes grading 0.34% V2O5 plus a contingent 3C oil resource of 589 million barrels.
Around $2.7 million from the offer is planned to go into the ground, including a 3000m drilling program to convert the inferred resource to measured or indicated status and completion of pre-feasibility studies.
Last year additional work was undertaken to study the various process routes available for possible vanadium pentoxide extraction, and it was concluded an integrated processing methodology should be investigated, to take advantage of the oil shale component of the inferred vanadium resource.
While the vanadium resources are sitting in soft shallow free-digging dirt and merely need to be concentrated to higher grades, unlocking the oil potential is more problematic.
Unlike the US shale plays, which fracture oil-bearing formations to recover liquids, the oil in kerogenic ores is typically unlocked, traditionally by mining and retorting at high temperatures, or using chemical processes.
QEM has been working with Griffith University in Queensland and Xian University in China to investigate the use of a supercritical water process on test samples from the Julia Creek to produce either hydrogen gas or liquid fuels from the oil shale, with some promising initial testwork.
A memorandum of understanding has also been signed with TSXV-listed Petroteq Energy to perform laboratory and bench testing for oil extraction on a sample of ore from Julia Creek using Petroteq's process for extracting heavy oil from oil sands and oil shales, which has produced and sold 10,000 barrels of oil at its laboratory in the USA.
QEM's non-executive board includes Citigold Corporation director and founding director of the Australian Gold Council John Foley as chairman; Atlas Iron director and former COO and CEO of ex-vanadium producer Atlantic, Daniel Harris; and the head of corporate of QEM's lead manager Vested Equities, Benjamin Cooper, who also heads unlisted explorers Cobalt Resources and Cartier Resources.
The executive team includes major shareholder David Fitch as chief operating officer; former Cuesta Coal, Santos, Whitehaven Coal and Origin Energy geologist Scott Drelincourt as general manager geology and development; and David Palumbo as company secretary, a role he also fills at Krakatoa Resources, High Grade Metals and European Cobalt.
QEM isn't the only player looking at the Toolebuc vanadium play. Incumbent Intermin Resources has a farm-out with Chinese-based AXF Vanadium for its 2.9 billion tonne resource, while Multicom Resources and Liontown Resources are picking over relinquished Intermin ground, although unlike QEM they are primarily focused on the metal potential.
Multicom has owned the Saint Elmo project for the past 18 months applied for a mining licence last October as part of a plant to push ahead with a fast-tracked pre-feasibility aimed at an initial production target of 10,000tpa, with a plan to double production subject to market conditions.
Liontown has pegged around 1000sq.km of Queensland, part of a mapped extension to Intermin Resources' 671Mt Lilyvale high-grade vanadium resource and is undertaking metallurgical testing.
Vanadium has been one of the strongest performing metals of the past two years off the back of tight global supply and emerging demand from the grid-scale energy storage and renewable energy sectors, and the price has increased around 300% since 2017, trading at around A$20 per pound recently.
The oil price has also recovered significantly from its lows in 2014 and is trading shy of $70 per barrel. Past attempts to recover oil from the Toolebuc Shale reportedly needed an oil price above $100/bbl.
