Rio Tinto and First Quantum form joint venture for La Granja

Rio Tinto (ASX:RIO) and First Quantum have formed a joint venture to unlock the development of the La Granja project in Peru.

La Granja is one of the largest undeveloped copper deposits in the world and it has the potential to be a large, long-life operation with an indicated and inferred mineral resource of 4.32bt at 0.51% copper.

First Quantum has acquired a 55% stake in the project for $105m and will invest up to a further $546m to fund capital and operational costs to take La Granja through a feasibility study and toward development.

As majority owner, First Quantum will operate La Granja with initial work focused on completing the feasibility study.

First Quantum chief executive Tristan Pascall commented on the joint venture.

“La Granja has the potential to be a large, long-life operation and supply the copper that will be needed as the world transitions to the greener economy and where responsible mining will be the only acceptable way to produce metals,” he said.

“As operator, we will leverage our core strengths in mine design, project development and community engagement and look forward to developing our partnership with Rio Tinto.”

Rio Tinto copper chief executive Bold Baatar said developing La Granja would strengthen the company’s portfolio.

“Developing La Granja would provide a significant new supply of copper and further strengthen Rio Tinto’s portfolio of materials needed for the energy transition,” he said.

“Our partnership with First Quantum will bring our combined development capabilities and deep knowledge of La Granja to progress the project.”