Rio Tinto has entered into a binding agreement with China National Uranium Corporation Limited (CNUC) for the sale of its entire 68,62 % stake in Rössing Uranium Limited, the owner of the Rössing mine in Namibia, for up to US$106,5 million.
The total consideration comprises an initial cash payment of US$6,5 million, payable at completion, and a contingent payment of up to US$100 million following completion. The contingent payment is linked to uranium spot prices and Rössing's net income during the next seven calendar years. In addition, Rio Tinto will receive a cash payment if CNUC sells the Zelda 20 Mineral Deposit during a restricted period following completion. The total consideration is subject to a maximum cap of US$106,5 million.
The transaction represents the culmination of an extensive assessment of strategic options considered by Rio Tinto in relation to Rössing.
“The sale of our interest in Rössing once again demonstrates our commitment to strengthening our portfolio and focussing on our core assets, which deliver sector leading returns in the short, medium and long term,” said Rio Tinto Chief Executive J-S Jacques.
“Rio Tinto has a long history in Namibia and I would like to thank the many people across Rio Tinto and the communities in which we operate who have contributed to the success of Rössing. I wish them continued success under new ownership. Rio Tinto will work closely with CNUC to ensure a smooth transition and ongoing sustainable operation at Rössing.”
Operating since 1976, the Rössing business has reportedly produced more uranium than any other single mine globally. It produces and exports uranium oxide from Namibia to nuclear power utilities around the world. In 2017, the mine produced 4,65 Mlb (approximately 2 110 tonnes) of uranium oxide.