Can Charger Metals (ASX: CHR) unlock a standalone lithium project at Lake Johnston after Rio Tinto walks away?

Charger Metals NL (ASX: CHR) has regained 100 percent ownership of its Lake Johnston Lithium and Gold Project in Western Australia following the termination of a farm-in agreement with Rio Tinto Exploration Pty Limited. The exit of Rio Tinto Exploration brings a two-year partnership to an early close and places full strategic control of the project back in the hands of the junior lithium explorer. Charger Metals now plans to fast-track a 41-hole drilling campaign at Medcalf and Medcalf West beginning in January 2026, with the goal of expanding the current lithium resource and testing new targets.

The Lake Johnston project, which lies within the highly prospective Yilgarn Province, includes an inferred mineral resource of 8.2 million tonnes at 1.0 percent lithium oxide at Medcalf and an additional conceptual exploration target of 3 to 5 million tonnes at 1.0 to 1.4 percent lithium oxide at the nearby Medcalf West zone. According to Charger Metals, these pegmatite-hosted lithium occurrences are high-grade, shallow and outcropping, offering a potentially attractive profile for future open-pit development.

Why did Rio Tinto Exploration abandon its earn-in despite investing over AUD 6 million?

Rio Tinto Exploration entered into the farm-in agreement in January 2024, with a commitment to sole-fund AUD 11 million in exploration and provide AUD 2 million in cash payments to earn a 51 percent stake in Lake Johnston. Over the course of the partnership, Rio Tinto Exploration contributed AUD 4.2 million in funded exploration, subscribed for AUD 1.2 million in equity in Charger Metals, and paid AUD 1 million in direct cash to the company. However, that left another AUD 5.8 million and an additional AUD 1 million cash installment outstanding before the milestone could be reached.

Both parties have now agreed to discontinue the farm-in structure. While Charger Metals acknowledged that no Rio Tinto-scale deposit was uncovered during the initial exploration phase, the company stated that the work conducted under the partnership helped accelerate geological understanding and created a strong foundation for follow-up drilling. Managing Director Bryan Dixon said the company now sees significant opportunity to grow the maiden resource independently and noted that Lake Johnston lies within trucking distance of four operational lithium concentrator plants.

What do the latest drilling results suggest about resource upside at Whitten and Mt Gordon?

Charger Metals recently completed a 3,422 metre reverse circulation drill program across its Whitten and Mt Gordon prospects. At Whitten, which is part of the larger Mt Day pegmatite field, five shallow drill holes were completed to determine the orientation and thickness of outcropping lithium-caesium-tantalum pegmatites. Assay results from this zone indicated that significant lithium mineralisation was encountered in only one drill hole, CLDRC005, which intersected 2 metres at 1.03 percent lithium oxide from 14 metres depth. The mineralisation at Whitten appears lepidolite-dominant with a shallow dip of 20 degrees to the north.

Although results from Whitten were mixed, Charger Metals has not ruled out the broader Mt Day corridor, which stretches 5.5 kilometres in length and 1.5 kilometres in width and is defined by high-grade lithium in rock chip samples and strong lithium-in-soil anomalies. The focus will now shift to assays pending from Mt Gordon, where 23 holes were drilled but results are yet to be reported. The company believes that this area, which has seen limited lithium exploration, could offer both lithium and gold potential, with drill programs designed to evaluate both.

How does Lake Johnston compare to other Yilgarn lithium projects?

The Lake Johnston Project sits within a lithium-rich corridor and is flanked by some of the largest hard-rock lithium deposits in Australia. According to the regional infrastructure map provided by Charger Metals, Earl Grey (Mt Holland) is located approximately 70 kilometres to the west and is held by Covalent Lithium Pty Ltd, a joint venture between Wesfarmers Limited and Sociedad Química y Minera de Chile S.A. That project holds reserves of 189 million tonnes at 1.5 percent lithium oxide and began production in March 2024. Other nearby deposits include Mineral Resources Limited’s Bald Hill at 58.1 million tonnes at 0.94 percent lithium oxide and Delta Lithium Limited’s Mt Ida deposit at 14.8 million tonnes at 1.2 percent lithium oxide.

While Charger Metals is still in the early stages of exploration compared to its regional peers, the presence of multiple lithium processing facilities within a 100 kilometre radius and encouraging near-surface mineralisation could offer development pathways. The company also notes that the mineralisation at both Medcalf and Medcalf West remains open along strike and at depth, which could provide upside with further drilling.

Can Charger Metals turn Bynoe into a second growth engine alongside Lake Johnston?

In addition to Lake Johnston, Charger Metals also owns 100 percent of the Bynoe Lithium Project in the Northern Territory. The project is located approximately 35 kilometres southwest of Darwin in a Tier 1 jurisdiction and is surrounded by tenements owned by Core Lithium Limited. Charger’s Bynoe project spans 63 square kilometres and lies within a known spodumene-rich belt. Charger has drilled three diamond holes and 66 reverse circulation holes across seven targets to date and confirmed lithium and tantalum mineralisation at three of those prospects. However, more than 20 identified lithium targets within Bynoe remain untested.

Importantly, the Blackbeard Prospect held by Core Lithium Limited lies just 50 metres from Charger’s Bynoe boundary. Core Lithium has published an exploration target for Blackbeard ranging from 7 to 10 million tonnes at 1.5 to 1.7 percent lithium oxide. In the third quarter of 2024, Core Lithium made an unsolicited, non-binding offer to acquire Charger Metals, later acquiring a 9.8 percent ownership stake. While the offer did not proceed, the stake acquisition signals institutional belief in Charger’s project pipeline and proximity-driven consolidation appeal.

How are analysts and investors interpreting the strategic reset at Lake Johnston?

The termination of the Rio Tinto Exploration agreement hands Charger Metals full control of exploration and development decisions at a project that now carries greater de-risking thanks to over AUD 6 million in capital already spent. Analysts tracking Australian battery metals explorers believe the strategic reset could allow the company to move faster and prioritise resource expansion drilling, especially given the high-grade, near-surface profile of the Medcalf deposit.

Market participants are likely to watch for two key near-term triggers. The first is the assay results from the Mt Gordon program, which could add a new lithium or gold zone to the broader Lake Johnston narrative. The second is the planned January 2026 drill campaign, which will test extensions of both Medcalf and the adjacent Medcalf West prospect. The scale of the permitted program—up to 41 holes—suggests that Charger is aiming to move aggressively toward resource growth in the first half of calendar year 2026.

While Charger Metals’ share price reaction post-announcement was not detailed, junior exploration equities in the lithium sector have faced increased volatility in recent months due to macroeconomic pressures and weaker spot prices. However, companies with strong land positions, cash-efficient exploration strategies, and regional infrastructure access have remained of interest to longer-term investors seeking leverage to future battery supply chains.

What exploration milestones and funding catalysts are expected in early 2026?

The January 2026 drilling program at Lake Johnston will be pivotal for Charger Metals as it tries to validate the Medcalf West exploration target and extend known mineralisation at Medcalf. Drill approvals are already in place, and the company is expected to provide continuous updates through the first quarter. In parallel, assay results from Mt Gordon are likely to shape decisions around gold versus lithium prioritisation in that zone.

At Bynoe, future drilling could be restarted once priorities are firmed up at Lake Johnston. The proximity to Core Lithium Limited’s active projects and the potential for M&A activity make Bynoe a strategic optionality play. Analysts expect Charger to stay focused on monetising exploration results through resource growth rather than pursuing early development without scale.

Can full ownership of Lake Johnston help Charger Metals scale into a mid-tier lithium player?

Charger Metals has entered 2026 with a clean slate and full ownership of its flagship lithium project at Lake Johnston. The company now holds 100 percent of all lithium, gold, and associated mineral rights in the area and is fully permitted to begin an aggressive drill program. With AUD 6.4 million already invested into exploration and infrastructure access advantages across both Western Australia and the Northern Territory, Charger is positioning itself to potentially transition from an early-stage explorer to a scalable lithium resource holder.

Whether the next round of drilling at Medcalf and Medcalf West delivers commercial-scale mineralisation remains the key variable, but the structural reset provides Charger with greater speed, autonomy, and investor narrative control heading into what could be a decisive year.

What are the key takeaways from Charger Metals’ 2025 reset at Lake Johnston?

• Charger Metals NL (ASX: CHR) has regained 100 percent ownership of the Lake Johnston Lithium and Gold Project after Rio Tinto Exploration Pty Limited withdrew from a farm-in agreement.

• Over the two-year partnership, Rio Tinto Exploration invested AUD 4.2 million in exploration, subscribed AUD 1.2 million in equity, and made AUD 1 million in cash payments to Charger Metals.

• The Lake Johnston project includes a maiden inferred resource of 8.2 million tonnes at 1.0 percent lithium oxide at Medcalf and a 3–5 million tonne exploration target at Medcalf West.

• Charger plans to launch a fully permitted 41-hole diamond and RC drilling campaign in January 2026, targeting extensions at Medcalf and initial testing at Medcalf West.

• Recent drilling at the Whitten pegmatite (Mt Day) returned one significant lithium intercept, while assay results for 3,012 metres of drilling at Mt Gordon are still pending.

• The project sits near four lithium concentrator plants and is located within the prolific Yilgarn lithium corridor in Western Australia.

• Charger Metals also owns the Bynoe Lithium Project near Darwin, where it has confirmed mineralisation at three prospects and has over 20 targets yet to be drill-tested.

• Core Lithium Ltd holds a 9.8 percent stake in Charger following an unsolicited acquisition approach in 2024.

• Analysts will be watching for assay results from Mt Gordon and the outcome of the Q1 2026 drilling campaign as key stock catalysts.

• The company is now fully autonomous in setting exploration strategy and is aiming to expand its resource base and investor relevance across two tier-one lithium jurisdictions.