Rio Tinto Plc ( RIO ) shares are trading higher premarket on Monday after it finalized joint venture agreements with Sumitomo Metal Mining (SMM) to advance the Winu copper-gold project in Western Australia’s Great Sandy Desert.

According to the deal, Rio Tinto will remain responsible for the ongoing development and operation of the Winu project.

In return, Sumitomo Metal Mining will pay Rio Tinto up to $430.4 million for a 30% ownership stake in the project.

This includes an upfront payment of $195 million, with the potential for up to an additional $235.4 million in deferred payments contingent on achieving future project milestones.

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The transaction is anticipated to be finalized in 2025, pending regulatory approvals and standard closing conditions.

The Winu project, discovered by Rio Tinto in 2017, is described as an attractive, low-risk, long-life copper-gold deposit with significant potential for expansion beyond its initial development plans.

Rio Tinto is maintaining its focus on partnerships with the Nyangumarta and Martu Traditional Owners, including ongoing Project Agreement negotiations.

The pre-feasibility study for the Winu project, outlining an initial processing capacity of up to 10 million tonnes per annum (mtpa), is expected to be finalized in 2025.

Rio Tinto Copper Chief Executive Katie Jackson said, “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.”

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

Last week, Rio Tinto disclosed that it entered into a Memorandum of Understanding (MoU) with AMG Metals & Materials to explore the development of a large-scale, low-carbon aluminum project in India.

Investors can gain exposure to the stock via VanEck Steel ETF ( SLX ) and iShares Copper and Metals Mining ETF ( ICOP ) .

Price Action: RIO shares are up 2.90% to $61.72 premarket at the last check on Monday.

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