Canadian mining company Forum Energy Metals has completed the acquisition of the remaining stake in the Janice Lake copper project, from Rio Tinto Exploration Canada (RTEC).

As part of the transaction consideration, Forum will grant RTEC a 20% back-in right in Janice Lake and a 2% net smelter royalty (NSR) capped at $50m.

RTEC may exercise the Back-in Right any time before 180 days after the completion of a feasibility study or start of commercial production if a feasibility study is not completed.

It can only exercise the Back-in-Right by paying an amount equalling all the expenditures incurred by Forum on the project, up to the Back-in-Right trigger date.

Upon exercise of the Back-in Right, both Forum and RTEC will establish an 80/20 joint venture to further develop the Janice Lake project.

Forum Energy Metals president and CEO Rick Mazur said: “This agreement allows Forum shareholders an optionality play in copper where Rio Tinto added significant value to the project.

“Forum has reviewed the data and has determined that copper deposits remain open for extension and numerous copper showings on the 52km extent of the property remain to be drilled.

“The key claims on the property are in good standing for four to nineteen years while copper emerges as a fundamental commodity to achieve the energy transition.”

Forum is expected to pay RTEC $500,000 upon the earlier completion of a PEA, completion of a feasibility study and start of commercial production.

The Canadian mining company will pay an additional $2m upon the earlier completion of a feasibility study or the start of commercial production if the FS is not completed earlier.

Forum’s obligations associated with the Milestone Payments are addressed by a debenture in favour of RTEC granting a first charge over all the assets acquired.

Janice Lake project is located in north-central Saskatchewan, within the Wollaston Domain, a northeasterly-trending belt of metamorphosed lower Proterozoic supracrustal rocks.

In 2020, Rio Tinto completed a 100km winter access road and constructed an 80-person base camp nearby at Burbidge Lake.