PERTH (miningweekly.com) – Mining giant Rio Tinto’s exploration arm has taken the decision to enter into an earn-in option agreement with ASX-listed Panoramic Resources over the Thunder Bay North project, in Canada.
In July last year, Rio Tinto Exploration Canada inked a consolidation agreement with Panoramic, bringing together Panoramic’s Thunder Bay North project and Rio’s Escape Lake project.
Under the terms of the consolidation agreement, Rio would have the option to spend up to C$20.25-million over the next five-and-a-half years to acquire a 70% interest in the Thunder Bay North project. If the diversified miner took up the spending, Panoramic would acquire a 30% stake in Escape Lake.
Rio’s exploration arm has informed Panoramic that it would exercise its rights under the agreement, after spending an initial C$440 000 by the end of last year on generating exploration targets at the Thunder Bay North project area.
During the earn-in phase, Rio would be required to spend a minimum of C$5-million before it could withdraw, with the company taking responsibility for project management and ensuring that the project tenements were kept in good standing.
Panoramic said that Rio’s decision to proceed with the earn-in agreement continued to provide a strong vote of confidence in the future of the Thunder Bay North project, while potentially giving Panoramic a 30% share in the Escape Lake project.
The transaction would also allow Panoramic to focus its resources on its core nickel business, and to advance the Panton platinum group metals project, and to advance feasibility studies on its gold assets, in Australia.