Chariot Resources has inked a binding term sheet with major Chinese and Nigerian partners for a phased drilling and trial mining program targeting lithium direct shipping ore in Nigeria, aiming to validate resource potential and establish a market-linked offtake.
- Binding term sheet with C&D and ZhongNuo for Nigerian lithium project
- Minimum 1,500 metres diamond drilling funded by ZhongNuo
- Trial mining capped at 240,000 tonnes of direct shipping ore
- C&D to act as offtake buyer with pricing linked to Shanghai Metals Market
- Program contingent on due diligence, approvals, and Nigerian portfolio acquisition
Partner-Funded Drilling and Trial Mining Agreement Reached
Chariot Resources Ltd (ASX:CC9) has taken a significant step towards advancing its Nigerian lithium ambitions by signing a binding term sheet with Chinese supply-chain giant C&D (Hainan) Co., Ltd, Hong Kong ZhongNuo Energy Limited, and its joint venture partner C&C Minerals. The agreement outlines a partner-funded program of drilling, potential trial mining, and direct shipping ore (DSO) offtake at one selected project within Chariot's Nigerian lithium portfolio.
The term sheet establishes a 90-day exclusivity window for site reviews and project selection from three prospects, Fonlo, Iganna, and Saki, subject to the completion of Chariot's Nigerian portfolio acquisition. ZhongNuo commits to funding a minimum 1,500 metres of diamond core drilling, with the possibility of advancing to trial mining capped at 240,000 tonnes of DSO, although this cap is not a production forecast.
Roles of Key Partners and Commercial Terms
C&D, a subsidiary of Xiamen C&D Inc (SSE: 600153), which reported RMB671 billion in revenue in 2025 and handles nearly 1.9 million tonnes of lithium-battery raw materials annually, will serve as the DSO offtake buyer and US dollar payer. Pricing will be linked to the Shanghai Metals Market China battery-grade lithium carbonate price, with a floor price of US$150 per dry metric tonne below which shipments need not proceed.
ZhongNuo will fund and operate the drilling and any agreed trial mining, leveraging its claimed Nigerian mining experience and access to processing infrastructure, which remains subject to verification. The joint venture vehicle C&C Minerals, owned two-thirds by Chariot and one-third by Continental Lithium Limited, will provide project rights and maintain custody of drilling samples and data.
Phased Approach and Conditions to Progress
The program is structured in phases, starting with project selection and drilling, followed by a decision point to evaluate results before committing to trial mining. The trial mining phase, if initiated, would be conducted under an agreed mining plan and capped at 240,000 tonnes of DSO within 24 months post-agreement execution.
The term sheet is binding only on exclusivity and process provisions; substantive drilling, trial mining, funding, and offtake arrangements hinge on due diligence, execution of definitive agreements, confirmation of mineral titles, regulatory approvals, and completion of the Nigerian portfolio acquisition. There are no minimum mining, delivery, or purchase commitments, and no assurance the program will proceed.
Strategic Implications and Next Steps
Chariot's executive chair Shanthar Pathmanathan described the term sheet as a structured pathway to generate valuable technical and operational data while testing a market route for qualifying DSO. The US$100,000 exclusivity fee paid by C&D and a proposed US$500,000 interest-free prepayment upon definitive agreement execution underscore the commercial seriousness of the arrangement.
Next steps include completing site reviews and project selection within the exclusivity period, conducting technical, legal, and commercial due diligence, negotiating definitive agreements detailing pricing, delivery, and risk provisions, and finalising the Nigerian portfolio acquisition. Only after these milestones will drilling commence, with material exploration results to be reported under ASX and JORC standards.
Bottom Line?
Chariot’s partner-funded Nigerian lithium program marks a cautious but meaningful advance, contingent on multiple approvals and commercial milestones before any production or revenue can materialise.
Questions in the middle?
- Will the drilling program confirm sufficient lithium mineralisation to justify trial mining?
- How swiftly can Chariot complete the Nigerian portfolio acquisition and secure all necessary approvals?
- Can the market-linked pricing formula deliver sustainable economics given lithium price volatility?