July 31, 2018 / 5:10 AM / 7 months ago

Rio Tinto signs preliminary deal for Uganda base metals JV

FILE PHOTO: The Rio Tinto mining company's logo is photographed at their annual general meeting in Sydney, Australia, May 4, 2017. REUTERS/Jason Reed/File Photo

MELBOURNE (Reuters) - Rio Tinto has signed a preliminary agreement with Australia’s Sipa Resources to jointly develop a base metals project in northern Uganda, Sipa Resources said on Tuesday.

Rio has the option to take up to 75 percent of the Kitgum-Pader base metals project by spending $59 million, including $2 million in cash payments, and $57 million on exploration in set stages across the next 11 years, Sipa said in a statement. Shares in the ASX-listed miner surged by 9 percent to $A0.12

The agreement remains conditional on due diligence being completed and satisfactory to Rio by mid-August 2018, Sipa Resources said.

Reporting by Melanie Burton; Editing by Sunil Nair

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