Rio Tinto, First Quantum Complete La Granja JV Deal

(RTTNews) - Rio Tinto (RTPPF.PK, RIO.L, RIO, RTNTF.PK) and First Quantum Minerals (FM.TO) have completed a transaction to form a joint venture that will work to unlock the development of the La Granja project in Peru, Rio Tinto said in a statement.

La Granja is a complex orebody located at high altitude in Cajamarca, Northern Peru, that has the potential to be a large, long-life operation, with a published Indicated and Inferred Mineral Resource totalling 4.32 billion tonnes at 0.51% copper.

Following the completion of conditions, First Quantum has acquired a 55% stake in the project for $105 million. It will invest up to a further $546 million into the joint venture to sole fund capital and operational costs to take the project through a feasibility study and toward development. Upon completion of the sole funding commitment, all subsequent expenditures will be applied on a pro-rata basis according to the share ownership of the project.

As majority owner, First Quantum will now operate the La Granja project with initial work focussed on completing the feasibility study, as per the Transfer Agreement signed with the Government of Peru.

Rio Tinto acquired the La Granja Project from the Government of Peru in 2006 and carried out an extensive drilling program.