Canadian mining giants Goldcorp (TSX:G), (NYSE:GG) and Teck Resources (TSX:TCK.A & TCK.B) (NYSE:TCK) said on Thursday they have agreed to form a joint venture to combine and develop neighbouring projects in Chile.
Goldcorp, the world’s most valuable gold miner, will add its El Morro project and diversified miner Teck (TSX:TCK.B) will contribute its Relincho project to the new Project Corridor joint venture, which will be owned 50-50 by the two Vancouver-based firms.
The projects are located approximately 40 kilometres apart in Chile’s copper-rich Atacama region, the miners said in a joint statement.
The venture, which will slash development costs as metal prices have dropped to multiyear lows, is estimated to require an initial investment of US$3.5 billion. The miners said the combined operation would provide much of the additional funding needed to construct future phases.
The target is a considerable reduction from the standalone development costs of the El Morro and Relincho projects, which were $3.9 billion and $4.5 billion respectively.
The companies estimate that Corridor will have a 32-year lifespan and produce an average of 190,000 tonnes of copper and 315,000 ounces of gold a year, over the first decade.