Rio Tinto and Sumitomo Metal Mining (SMM) have entered into a term sheet for a joint venture to develop the Winu copper-gold project in Western Australia’s Great Sandy Desert. Under the agreement, Rio Tinto will remain the managing partner of the project, with SMM acquiring a 30% equity stake for $399 million. This includes an upfront payment of $195 million, plus an additional $204 million in deferred payments contingent on achieving certain milestones.
The two companies have also signed a letter of intent to explore a broader strategic partnership in copper, base metals and lithium, aiming to collaborate on commercial, technical, and strategic opportunities.
The Winu project, first discovered by Rio Tinto in 2017, is considered a low-risk, long-life copper-gold deposit with significant potential for expansion. The project’s estimated total investment by June 2024 will be $438 million, including exploration and development costs. Located near Rio Tinto’s Pilbara iron ore assets, Winu will involve the development of an open pit mine, ore processing facilities, and necessary infrastructure, including stockpiles, tailings storage and water supply systems.
Concentrates from the project will be transported via road and Great Northern Highway to a third-party port for export, while unrefined gold bars will be flown out by air charter. The project’s initial development plan includes processing capacity of up to 10 million tonnes per annum (mtpa), with a pre-feasibility study expected to be completed by 2025.
Rio Tinto and SMM are working toward finalizing definitive agreements for the joint venture by mid-2025, along with formalizing the broader strategic partnership. Additionally, Rio Tinto is continuing its engagement with the Nyangumarta Traditional Owners to progress project agreement negotiations.
The deal is subject to the necessary approvals and customary conditions before it can close.
