Rio Tinto has teamed up with Renascor Resources to jointly explore and develop part of the Marree copper project in South Australia’s Adelaide fold belt.
Under the agreement, Rio Tinto Exploration has the potential to earn 80 per cent interest in EL 5586 by funding $200,000 to Renascor and sole funding a further $3 million in exploration over five years.
Renascor will retain 100 per cent interest in the remaining exploration licenses EL 6170 and EL 6403, which together form the Marree project.
Should Rio Tinto make the payments over a two-year period and fund the exploration within five years to meet the earn-in requirements, the two companies will form an official joint venture.
Both parties have the right to dilute their respective interests of 80 per cent (Rio Tinto exploration) and 20 per cent (Renascor) and if either party’s interest falls below 5 per cent, it will convert to a 1.25 per cent net smelter royalty on the first 12 years of production.
“We are delighted that Rio Tinto Exploration has agreed to commit its considerable resources and expertise towards exploring EL 5586,” Renascor managing director David Christensen said.
“This agreement is consistent with Renascor’s strategy of maximising the value of our significant pipeline of exploration projects in South Australia, while dedicating our resources towards advancing core projects with near-term potential to offer significant value uplift.
“Renascor shareholders will have an opportunity to benefit from the discovery potential of this highly prospective but underexplored exploration prospect.”
The Marree project is identifying drilling prospects for large tonnage Zambian copper-belt style, sedimentary copper deposits, sequences which have long been recognised within the Adelaide gold belt.
Renascor Resources has also been reviewing historical exploration in the area, which resulted in the company identifying the Callanna copper prospect and two prospective sedimentary copper target zones.
Ground sampling at Callanna returned anomalous gold values, maximum 2.6 grams per tonne of gold and oxide copper mineralisation.
A small working area about 3 kilometres north of Callanna also returned 27 per cent copper at 0.4 grams per tonne of gold and anomalies for rare earths and molybdenum, suggesting a granitic intrusive association.