Star Diamond objects to Rio Tinto joint venture meeting
Junior miner Star Diamond on Thursday said it objected to Rio Tinto's "predatory and coercive" actions after the global miner called a meeting for a joint venture the Canadian company says does not yet exist.
The companies have been in a long-running dispute over development of Star Diamond's Star-Orion South Diamond Project in the Canadian province of Saskatchewan.
In 2017 Star Diamond entered an earn-in agreement with Rio Tinto Exploration Canada Inc giving the Anglo-Australian miner an option to earn up to a 60% interest in the project.
Saskatoon-based Star Diamond later said Rio overspent on the project while exercising its earn-in options before completing and delivering results from its bulk sampling program. It said the Rio Tinto was trying to boost its stake at below market value.
Rio has spent roughly C$168-million to complete a 10-hole bulk sample program that Rio told Star Diamond would originally cost about C$18.5-million, the Canadian company said on Thursday.
"Rio Tinto now seeks to call a management committee meeting that it has no legal right to call for a joint venture that Rio Tinto knows has not been duly formed," Star Diamond said in a release.
Rio did not immediately respond to a request for comment.
A preliminary study in 2018 estimated 66-million carats of diamonds could be recovered from the C$2-billion Star-Orion project over a 38-year mine life.
Rio faced similar acrimony with its junior partner Turquoise Hill Resources over expansion of the pair's Oyu Tolgoi copper-gold mine in Mongolia, although that dispute was put to bed in April.
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