Rio Tinto has signed a farm-in agreement with Tali Resources, a unit of Agrimin, to acquire the latter’s stake in five exploration prospective copper-gold tenements in Western Australia.
As per the farm-in and joint-venture deal with Agrimin’s 40%-owned unit Tali, Rio Tinto will acquire up to a 75% stake in the five tenements located in the West Arunta and Madura regions of the state.
The tenements are prospective for iron oxide copper-gold (IOCG) mineralisation.
The agreement, however, excludes Agrimin’s tenements and does not cover any areas associated with the company’s Mackay Potash project.
Agrimin CEO Mark Savich said: “It is pleasing to see a major mining company such as Rio Tinto commit to exploring on Kiwirrkurra lands within the West Arunta region through its farm-in agreement with Tali.
“We look forward to the commencement of their exploration as well as the prospect of new opportunities being created for the Kiwirrkurra community.”
The agreement will be implemented in three stages. Under the first stage, Rio Tinto can earn an initial 51% joint venture interest in the tenements by sole funding exploration expenditure of $3m.
Subject to the satisfaction of stage 1, Rio Tinto can earn an additional 14% joint venture interest in the tenements by sole funding exploration expenditure of an additional $5.5m.
Within the next four years, the company will also complete a total of 7,000m of diamond and/or RC drilling in the tenements.
The final stage will add a further 10% stake to Rio Tinto’s earnings but is dependent on the success of the prospects.