TNG Limited to sell exploration licence application to Rio Tinto

Australian strategic metals company TNG Limited announced that the company signed an agreement for the sale of its wholly owned Melville Island exploration licence application (ELA) in the Northern Territory to Rio Tinto Exploration.

ELA 28617 covers an area of 1,387km2 in the north-western part of Melville Island and have potential for bauxite and heavy minerals.

TNG’s Managing Director, Mr Paul Burton, said “Over the past 12 months, we have demonstrated a clear intent to rationalise our portfolio consistent with our focus as an emerging international strategic metals producer.”

“A key step in this process was the successful demerger and IPO of our Northern Territory base metal exploration assets through Todd River Resources, and this transaction with RTX marks another step towards consolidating our minerals portfolio while retaining some exposure to the future development potential of this asset.”

 The companies inked a farm-in agreement in October 2012, allowing Rio Tinto to earn 80 per cent equity in the project with TNG retaining 20 per cent equity.

TNG has now agreed to sell its interest in the project to RTX for $80,000, in addition to a 2% Net Smelter Royalty (NSR).