Rio Tinto has finalised its sale of the Murphy uranium tenements in the Northern Territory to Canadian company Laramide Resources.
The Murphy uranium tenements, located near the Queensland-NT border, were responsible for the production of high-grade uranium in the 1950s but have not seen much exploration since the 1970s. The tenements are contiguous to Laramide’s Westmoreland project in northwest Queensland.
The acquisition comprises the EL 9319 and EL 9414 exploration licences and several other applications across 683 square kilometres.
Laramide has paid Rio the first of three $150,000 cash payments to Rio Tinto as laid out in the terms of the agreement announced in July this year.
The Toronto-based uranium specialist is to pay a further $150,000 on or before 12 months from the closing date, then a further and final $150,000 on or before 24 months from the closing date.
Laramide can pay these in cash or common shares. It can also exercise a 10 per cent discount on the 10-day volume-weighted average price (VWAP) should it decide to pay with shares.
Rio has a one-off right to clawback a 51 per cent interest in the tenements via a possible joint venture should Laramide discover and develop a measured and indicated mineral resource estimate in excess of $1 billion. Rio also has right of first refusal over future divestments under certain conditions.
The agreement replaces a previous joint venture between the two companies from 2011.