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Charger Metals NL (ASX: CHR, ‘Charger’ or ‘the Company’) is pleased to announce it has entered into a binding farm-in agreement with Rio Tinto Exploration Pty Ltd (“RTX”), a wholly-owned subsidiary of Rio Tinto Limited (ASX:RIO) for its Lake Johnston Lithium Project in the Yilgarn of Western Australia (RTX Agreement).
- Charger has entered into a binding agreement with Lithium Australia Limited (ASX: LIT) to purchase their minority interest in the Lake Johnston Lithium Project for $2 million to increase Charger’s interest to 100% (LIT Agreement)1.
- Simultaneously, Rio Tinto Exploration Pty Ltd (“RTX”), a wholly-owned subsidiary of Rio Tinto Limited (ASX: RIO), has signed a binding farm-in agreement for the Lake Johnston Lithium Project (RTX Agreement)1:
- RTX to pay Charger $500,000 and invest $1.2 million in Charger prior to commencement of farm-in;
- RTX to spend minimum $3 million exploration expenditure over the first 12 months;
- RTX can earn 51% by sole funding $10 million in exploration expenditure and paying Charger minimum further cash payments of $1.5 million;
- RTX can earn 75% by sole funding $40 million in exploration expenditure or completing a Definitive Feasibility Study.
- The RTX deal reaffirms the prospectivity of the Lake Johnston Lithium Project and its potential to host a large-scale lithium deposit.
Charger is also pleased to announce it has simultaneously entered into a binding agreement with Lithium Australia Limited (ASX:LIT) to purchase their minority interest in the Lake Johnston Lithium Project moving the Company to a 100% beneficial ownership (LIT Agreement), subject to shareholder approval, other third party approvals and the RTX Agreement.
Charger’s Managing Director, Aidan Platel, commented:
“The Rio Tinto Exploration farm-in agreement is an excellent result for Charger and its shareholders and reaffirms our belief that the Lake Johnston Project has potential to host a large-scale lithium deposit. The planned significant investment by RTX will allow thorough systematic exploration over all of the project tenure, with initial exploration focused on fast-tracking the Medcalf Spodumene Prospect as well as progressing the Mt Day and Mt Gordon lithium prospects.”
Charger’s Chairman, Adrian Griffin, commented:
“The Rio Tinto Exploration farm-in agreement will see them potentially spending up to $42.5 million to earn up to a 75% interest in the Lake Johnston Project. The largely unexplored Lake Johnston Greenstone belt now hosts multiple spodumene discoveries and with the recent focus and increasing exploration activity could evolve into a prominent lithium province.”
Figure 1. Location of the Lake Johnston Lithium Project which was first successfully drilled for lithium in December 2022.
Figure 2. Selected RC drill intersections of spodumene-bearing pegmatites at the Medcalf Prospect.2
Figure 3. Soil sample results of the Mt Gordon tenement showing lithium anomalies. TG Metals Ltd’s soil anomalies at their Burmeister lithium discovery are shown for reference. 3
TG Metals has conducted infill and extensional soil sampling (400m x 50m spacing) over the area immediately east of their recent discovery of a spodumene rich pegmatite at Burmeister (TG6 ASX announcements of 30 October 2023 and 13 November 2023). The results have defined a new area of lithium-in-soils anomalism, identified as the Jaegermeister Prospect, which extends to Charger’s 100% owned Mt Gordon lithium prospect (see Figure 3).
About the Lake Johnston Lithium Project
The Lake Johnston Lithium Project is located 450km east of Perth, Western Australia. Lithium prospects occur within a 50km long corridor along the southern and western margin of the Lake Johnston granite batholith. Key target areas include the Medcalf Spodumene Prospect, the Mt Gordon Lithium Prospect and much of the Mount Day LCT pegmatite field, prospective for lithium and tantalum minerals.
The Lake Johnston Lithium Project is located approximately 70km east of the large Earl Grey (Mt Holland) Lithium Project which is under development by Covalent Lithium Pty Ltd (manager of a joint venture between subsidiaries of Sociedad Química y Minera de Chile S.A. and Wesfarmers Limited). Mt Holland is understood to be one of the largest hard-rock lithium projects in Australia with Ore Reserves for the Earl Grey Deposit estimated at 189 Mt at 1.5% Li2O.4
This article includes content from Charger Metals, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
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