A joint venture partner can make sense if—and only if—their involvement clearly accelerates the path from licence to defined resource to production in ways the licence holder cannot achieve alone at the same speed or cost. Outside of that condition, a JV is not value creation; it is value leakage.
At the early stages of most mining projects, the licence holder’s strongest assets are not capital-intensive. They are license control, first-mover positioning, local relationships, regulatory capital, and project origination. These are the hardest assets to acquire in mining, particularly in Africa and Latin America, where access, trust, and jurisdictional understanding take years to build. Once diluted prematurely, they are almost impossible to recover.
For that reason, equity in an early-stage mining project should never be gifted. It must be earned. Before any discussion of equity percentages, a prospective JV partner must demonstrate real, binding value. That value must be tangible and measurable. It may come through technical delivery—funding and executing geological mapping, geophysics, drilling, and metallurgical work to internationally recognised reporting
standards such as JORC or NI 43-101. It may come through capital commitment—hard funding, not “best e orts,” ideally staged across exploration, development, and construction. Or it may come through operating capability—a proven track record in mine development or operations, access to EPC or mining contractors, and demonstrated processing plant experience.
If none of these are clearly on the table, the discussion is not about a joint venture. At best, it is a technical services arrangement or a loose collaboration.
Equally important is what the licence holder must retain in the early phases. Licence ownership must remain with the originator. Operatorship must remain with the originator. Board control must remain with the originator. And the right to determine whether earn-in milestones have genuinely been met must sit firmly with the licence holder. Equity should only ever be earned through spend and delivery—not assigned upfront on goodwill or future promises.
The most e ective JV structures in mining are staged, reflecting how serious partnerships are actually built.
The first phase is technical and strategic collaboration, typically over three to six months. This sits under a mining-specific NCNDA and a technical cooperation MoU. The purpose is controlled data sharing, desktop studies, and early scoping work, with no equity transfer. The outcome of this phase is binary: a clear go or no-go decision on whether a farm-in is justified.
If that hurdle is cleared, the second phase is a formal earn-in JV focused on moving the project from exploration toward a defined resource. Under this structure, the incoming partner may earn up to 30–49%, but only by spending an agreed amount of capital and completing clearly defined work programmes. Milestones are tied to deliverables such as a maiden mineral resource estimate and a PEA or scoping study. Throughout this phase, the original licence holder remains operator.
Only once project economics begin to crystallise—typically at PEA or PFS level—does the third phase make sense. At this point, a project-level SPV can be established with clear capex obligations, dilution mechanics, and default consequences. At this stage, equity dilution is justified because the core geological and technical risks have been materially reduced.
There are also clear red lines that should not be crossed. Licence equity should not be assigned upfront. Original licences should not be shared without robust earn-in protections. Direct access to regulators or communities should not be granted without the licence holder at the centre. And no partner should be allowed to “parallel run” discussions with third parties. These are irreversible errors in mining and have
destroyed more projects than geology ever has.
The commercial reality is straightforward. A serious partner will accept staged earn-in structures, fund agreed work programmes, respect operatorship, and move quickly on execution. A partner who resists structure, milestones, or binding funding commitments is not partnering—they are testing leverage.
Structured correctly, a JV can be a powerful catalyst. It can transform dormant licences into advancing projects, position licence holders as true project generators, and create a pipeline of de-risked assets capable of supporting private capital raises or eventual public listings. Structured poorly, it dilutes the most valuable asset a mine owner has: control.
For mine owners across Africa and Latin America, the mindset shift is essential. Holding 100% of an undeveloped asset for years while waiting for “the right moment” rarely creates value. Progress creates value. The right JV, on the right terms, is not a concession—it is a tool to move licences forward, reduce risk, and unlock outcomes that would otherwise remain theoretical.
The disciplined path forward is clear: begin with a mining-specific, non-binding JV term sheet; follow with a staged earn-in agreement aligned precisely to each licence; and support it with a concise partner brief that clearly articulates what the licence holder brings, what the partner must fund and deliver, and where the upside lies for both sides.
In mining, structure is strategy. Those who understand this build projects. Those who do not merely hold paper.
