Australian miner Rio Tinto on Monday announced a final joint venture (JV) agreement with Japanese group Sumitomo Metal Mining (SMM) to develop the Winu copper and gold project, in the Great Sandy Desert of Western Australia.

Under the agreements, Rio Tinto will continue to develop and operate Winu, and SMM will pay Rio Tinto up to $430.4-million for a 30% equity share of the project. This will include $195-million up front and up to $235.4-million in deferred considerations contingent on future milestones.

The parties will also continue to work together to develop a broader strategic partnership to explore opportunities for commercial, technical and strategic collaboration across copper, other base metals and lithium.

The final joint venture agreements were signed in Perth by Rio Tinto copper CE Katie Jackson and SMM director, managing executive officer, and general manager of the mineral resources division Hideyuki Okamoto.

The two companies signed a term sheet in December last year to form the JV.

“Our relationship with SMM began in 2000 with our partnership at the Northparkes mine in New South Wales and we look forward to bringing our combined experience and expertise to deliver the Winu project,” said Jackson.

“This partnership is an excellent fit for Rio Tinto and will strengthen the project, as we continue to prioritise the strong and enduring partnerships built to date with the land’s Traditional Owners, the Nyangumarta and the Martu.”

The transaction is expected to close in 2025, subject to regulatory approvals and the satisfaction of customary conditions.

The Winu project is a low-risk, long-life copper/gold deposit discovered by Rio Tinto in 2017. It is considered highly prospective for expansion beyond the initial development.

A prefeasibility study for the project with an initial development of processing capacity of up to 10-million tonnes a year is expected to be completed this year, along with the submission of an environmental review document under the Environmental Protection Agency of Western Australian environmental impact assessment process.

Rio Tinto said it continued to focus on its partnerships with the Nyangumarta traditional owners and the Martu traditional owners, including progressing project agreement negotiations.