Transcription of The Stock Network Interview with Chariot Resources (ASX:CC9), Chair and Managing Director Shanthar Pathmanathan
Lel Smits: Chariot Resources has just signed a term sheet with CND, Xiongnu and CNC Minerals for a proposed partner-funded drilling, trial mining and DSO offtake program across one Nigerian lithium project. Xiongnu would fund at least 1,500 metres of drilling and potential trial mining, while CND would act as the offtake buyer.
I’m joined today by Chariot’s Executive Chair and Managing Director, Shanthar Pathmanathan, to discuss the partnership and key milestones ahead.
Shanthar, welcome back to the Stock Network.
Shanthar Pathmanathan: Pleasure, Lel, thank you for having me.
Lel Smits: Now, under the deal you’ve just announced, Xiongnu will fund at least 1,500 metres of drilling with a potential trial mining of up to 240,000 tonnes.
Shanthar, can you let me know, what are you going to be looking for from the drilling before progressing?
Shanthar Pathmanathan: Yes, so this is essentially drilling around the existing pits, right? So it’s a brownfield exploration in a sense, and they’re already on the ground, they’re mapping the pegmatites as we speak. There’s pretty large pits there, you know, 40, 50 metres wide, some of these pits. And the idea is, they’ve only gone down the artisanal miners a few metres, so the idea is to drill under those pits and, you know, the drilling will be what it is in the end, right? So the beautiful thing is, they’re going to fund the drilling, and they’re going to conduct the drilling as well.
So they’ve got drill rigs, they’ve got a flotation plant close to these properties. They have something like 40 haulage trucks. They’ve got all the mining equipment.
They were operating another mining site that’s now ceased because the ore has been depleted, and they need another dedicated source, so hence why they’re coming to our property. So we’re expecting, you know, what we would normally expect from drilling.
Lel Smits: Excellent.
And the agreement also includes C&D purchasing qualifying DSO under a market-linked pricing formula. How important is this potential offtake pathway really for Chariot’s Nigerian strategy?
Shanthar Pathmanathan: It’s so important in many ways. C&D is the largest buyer of lithium on the planet.
The balance sheet is immense. They’re state-owned. They’re a Fortune 500 company, $680 billion in revenue, so some part of a trillion yuan in revenue, in 170 countries and 100-plus battery market customers.
So we’re dealing with the best as a potential offtaker, and they’re going to be bankrolling the whole situation. And eventually they will buy from a Singapore company that we are in the process of setting up. So all parties will get their revenue split from a Singapore vehicle, tax-friendly, a great jurisdiction for managing money, and including the Nigerians will derive their revenue from that Singapore vehicle as well.
So it’s a huge show of confidence in terms of the Chinese part of this equation.
Lel Smits: Fantastic. And the parties have 90 days to select one project from Fonlo, Agana and Saki.
What milestones will you be targeting next?
Shanthar Pathmanathan: So they’re on the ground mapping. The mapping is going to inform the project selection. As I said, then drilling will happen after we sign the definitive agreement, 1500m.
The beautiful thing about what we’ve done here is we will not cede any property rights. It’s just a trial mine envelope, 240,000 tonnes, which is a decent amount. But assuming we’ve got something serious there, like 100m x sizable resource, all we are doing is extracting, say, some part of a million tonnes, that’s it.
And that’s the deal. And so they’ll be selecting one of the projects to do exactly this.
Lel Smits: Shanthar, thank you for the update from Chariot Resources.
Shanthar Pathmanathan: Thank you, Lel, appreciate it.
Ends