Canadian uranium company Laramide Resources has made a deal with Rio Tinto to buy the Murphy uranium tenements in the Northern Territory.
Laramide will purchase the tenements with three separate payments of $150,000 in cash or common shares for a total of $450,000. The agreement replaces a 2011 joint venture between the companies that allowed Laramide a 51 per cent earn in.
The tenements are within the Murphy Uranium Province and comprise of two exploration licences, EL 9319 and EL 9414, and several associated licence applications over 683 square kilometres. The region has not seen extensive exploration since the 1970s.
Should Laramide choose to pay with company common shares, it will do so at a 10 per cent discount at a weighted volume average price (WVAP) on the company’s Canadian share price over the 10 days prior to the deal.
The first payment is due within 25 business days of the closing date, which is to be finalised in the third quarter of 2018 subject to regulatory approvals. The second and third payments will then be due within 12 and 24 months of the closing date respectively.
Rio has a one-off right to clawback a 51 per cent interest in the tenements via a possible JV should Laramide discover and develop a measured and indicated mineral resource estimate in excess of $1 billion.