Rio Tinto will transfer its 75% share in the Saskatchewan Fort à la Corne project to Star Diamond Corporation as it moves its exploration primarily to metals and minerals.
In exchange, Rio Tinto will up its stake in Star Diamond to 19.9% from its previous 2.3% share, Star Diamond said Wednesday. The Australian miner will also pay Star Diamond CAD 4 million ($2.9 million) to remove itself from the project and will transfer ownership of the site’s processing plant, diamond sorter, and other equipment to Star Diamond, which will become the full owner of the venture.
Rio Tinto will retain the right to increase its share in Star Diamond should the smaller miner receive an acquisition proposal for the Fort à la Corne project.
“The majority of Rio Tinto’s global exploration program is now firmly focused on metals and minerals to support the energy transition,” Dave Andrews, Rio Tinto’s head of exploration explained. “Although we will no longer have direct involvement in the project, we are pleased to be able to maintain our interest…by gaining a 19.9% ownership interest in Star Diamond. After more than five years, we continue to see potential in the project and believe it can be a significant contributor to both the local communities around the Fort à la Corne property and the broader Saskatchewan economy.”
The move follows issues between the joint-venture partners over the terms of their agreement, during which Star Diamond considered cutting Rio Tinto out of the project. Last year, Rio Tinto put the project on hold until it could determine whether it wanted to continue or exit the venture. It has not contributed financially to Fort à la Corne since June 2022.
Main image: The Fort à la Corne diamond project. (Star Diamond Corporation)