Rio Tinto partners with LCL Resources to fund Ono project exploration in Papua New Guinea, aiming for major copper-gold discoveries.
LCL Resources, a junior mining company listed on the ASX, has entered into a farm-in and joint venture agreement with Rio Tinto for its Ono project in Papua New Guinea. This strategic partnership is expected to unlock exploration funding of up to A$48 million, aimed at advancing the project’s potential for significant porphyry copper and gold discoveries.
Under the terms of the agreement, Rio Tinto can secure an initial 51% stake in the Ono project by solely funding a minimum of A$8 million in exploration activities. This commitment includes conducting at least 4,000 meters of drilling, a critical step in evaluating the mineral potential of the site. In addition to funding exploration, Rio Tinto will also provide staged cash payments totaling up to A$1.5 million to LCL Resources.
The agreement further provides Rio Tinto with the option to increase its ownership in the project to 80%. This can be achieved either by investing an additional A$40 million in exploration or by successfully defining a mineral resource that complies with Joint Ore Reserve Committee (JORC) standards. Specifically, the target is to establish at least 1.25 million tonnes of contained metal on a copper-equivalent basis and complete a preliminary scoping study to assess development viability.
LCL Resources’ executive chairperson, Chris van Wijk, described the deal as a transformative milestone for the company. He emphasized that partnering with a global mining leader like Rio Tinto brings not only substantial financial support but also world-class technical expertise in exploration. This collaboration will enable a level of exploration intensity and sophistication that LCL could not achieve independently. Importantly, the structure of the agreement ensures that LCL shareholders retain meaningful exposure to any exploration success and potential discoveries funded by Rio Tinto.
The agreement follows over a year of collaborative work between the two companies, during which they assessed the broader geological potential of LCL’s tenements in Papua New Guinea. Rio Tinto has leveraged its extensive exploration database and regional experience to identify promising targets within the area.
The Ono project is located approximately 150 kilometers south of Lae, within the Owen Stanley Metamorphic Belt—a geologically significant region known for hosting major mineral deposits. Notable nearby operations include the Hidden Valley and Wafi-Golpu deposits, which underscore the area’s strong mineral endowment. Within the Ono project itself lies the Kusi gold skarn resource, and the broader area is considered highly prospective for large-scale copper porphyry systems.
LCL Resources highlighted that existing mineralisation, along with the presence of high-grade base metal concentrations, supports the concept of a potentially large porphyry system. Despite these encouraging indicators, much of the project area remains underexplored, presenting considerable upside potential.
The company also noted that the transaction reinforces confidence in the project’s geological promise, particularly in light of recent high-grade gold and silver assay results. With the financial backing and technical capabilities of Rio Tinto, LCL is now better positioned to accelerate exploration activities and unlock the full potential of the Ono project.
