Rio Tinto has signed an earn-in and joint venture agreement worth up to $US10.75 million ($14.5 million) with Strandline Resources for a suite of heavy minerals sands (HMS) tenements in Tanzania.
Strandline’s portfolio, which includes the Miteja, Kiswere, Sudi and Mtwara prospects, is located in the southern region of Tanzania, extending along 350km of the country’s coastline.
Under the agreement, Rio has the option to spend up to $US9 million ($12 million) on project expenditure to earn up to a 75 per cent stake in the mineral sands portfolio, including additional cash payments of $US1.75 million ($2.5 million) to Strandline.
Strandline’s managing director and CEO, Luke Graham, welcomed Rio’s involvement as it reinforces the potential of the mineral sands assets.
“This transaction delivers a strong source of funding and regional mineral sands expertise to significantly enhance the development potential of the company’s southern ground in Tanzania, with a view to ultimately developing one or more economic mineral sands mines,” he said.
The joint venture enables Strandline to ramp up exploration activities in the project area, with Rio contributing both funds and expertise.
It also allows Strandline to simultaneously progress its northern projects and find additional exploration and development initiatives.
Strandline will act as the manager until Rio has earned a 51 per cent interest in the joint venture.
According to Graham, exploration activities are set to begin “as soon as practicable”.