Rio Tinto plans drilling on ground in Argentina

London-based Rio Tinto (RTP-N) plans to begin drilling the El Acay porphyry project in Salta province, Argentina, by early May.

The program will consist of 2,000 metres of reverse circulation drilling designed to test an area of strong hydrothermal alteration. Measuring 7 km by 4 km, the target area includes intrusives and sedimentary rocks that are anomalous in gold, copper and molybdenum.

Rio Tinto can purchase El Acay from Aranlee Resources (ARB-V) by assuming the balance of payments owed to the original vendor, which total US$830,000 over the next four years. It must also spend US$2 million on exploration over five years and complete a feasibility study.

The major can also elect to pay the vendor a net smelter return royalty of 0.9% or a flat fee of US$1 million within 180 days of completion of the feasibility study.

Rio Tinto already holds 100% of the adjacent Saladillo concession. Combined, Saldillo and El Acay cover 15,100 ha.

Aranlee retains a back-in right to a 40% interest in the combined property for six months after release of the feasibility study.