Canadian gold mining company, Barrick Gold has formed a joint venture with Shandong Gold by selling half of its stake in the Veladero mine, located in San Juan province in Argentina.

The stake was sold for C$960m ($740m). Amount from the sale proceeds will be used by Barrick to reduce its debt burden.

Forming the joint venture, according to Barrick Gold is the first of the three steps outlined by a cooperation agreement between the two companies that was signed in this April.

In line with the second step of the agreement, the two companies have formed a working group to explore the joint development of the Pascua-Lama deposit.

The third step involves evaluating the possibility of additional investment in what is claimed to be a highly prospective El Indio Gold Belt on the border of Argentina and Chile, which is home to several gold mine projects such as Veladero, Pascua-Lama, and Alturas.

During the agreement, signing back in April, Barrick executive chairman John L. Thornton said “Our ambition is to make Barrick a leading twenty-first-century company in any industry in any jurisdiction, and by definition, that means creating a distinctive, enduring, and trust-based relationship with China and China’s best companies. This agreement moves us down that path.

“Shandong is an ideal partner to help us unlock the untapped mineral wealth of the El Indio Belt over the long-term, while working with us to generate more value from the Veladero mine today.

“We look forward to working in partnership with Shandong, sharing mining and development expertise, talent, and capital in ways that will create added value for our respective owners, and our government and community partners in San Juan province.”