Rio Tinto sells Brazilian iron ore project to Latin Resources

Rio Tinto sells Brazilian iron ore project to Latin Resources

The Borborema project is conveniently located close to ports and existing infrastructure.

Giant miner Rio Tinto (ASX:RIO), in the midst of selling all its non-core assets, has waved good bye to yet another project, this time in the iron ore-rich Brazilian district of Rio Grande do Norte State, to fellow Australian Latin Resources (ASX:LRS), Noticias de Mineracao reports (in Portuguese).

The move is considered a potential game changer for Latin Resources —until now focused in Peru— as the Borborema Iron Ore project is conveniently located between the 5 million tonne per annum producing Saquinho mine owned by India's Zamin Resources and the producing Bonito mine owned by Mhag.

Given the project's location and profile, the deal also opens the door for Latin to easily find joint venture partners to develop Borborema.

Latin Resources said Wednesday it will pay Rio Tinto’s exploration arm $200,000 for the project, plus $45,000 in legal costs and taxes. The company has also committed to pay a 3% net smelter royalty for the 24 exploration claims and application claims making up the project.

The sale of Borborema came on the heels of Rio’s decision to ditch two coal exploration licences in Queensland, Australia.