Rio Tinto has opted to handover control of its Bunder diamond project to Madhya Pradesh state government in India following a comprehensive review.

In August last year, the company announced that it would not proceed with development of Bunder project due to commercial considerations and would seek to close all project infrastructure.

Under an order signed last month, the state government will accept ownership and take responsibility of the mine and related assets.

Rio Tinto Copper & Diamonds chief executive Arnaud Soirat said: “Our exit from Bunder is the latest example of Rio Tinto streamlining its asset portfolio. It simplifies our business, allowing us to focus on our world-class assets.

"Our exit from Bunder is the latest example of Rio Tinto streamlining its asset portfolio."

“We believe in the value and quality of the Bunder project and support its future development, and the best way to achieve that is to handover the assets to the Government of Madhya Pradesh.

“Rio Tinto has long and enduring ties with India and we continue to see the nation as an important market for our metals and minerals and as a key hub for Rio Tinto’s business services.”

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The government will acquire all land, plant, equipment and vehicles located at the Bunder project site.

It will also secure all diamond samples that were recovered during exploration. This will help the state government package the assets if it decides to auction Bunder mineral rights.