Legacy Minerals Holdings (ASX:LGM) entered into a farm-in and joint venture option agreement with Rio Tinto Group (ASX:RIO) unit Rio Tinto Exploration, under which the unit can earn up to a 80% joint venture interest in the Thomson project in New South Wales by sole funding up to AU$25 million of staged exploration, according to a Monday Australian bourse filing.

Rio Tinto Exploration will have the option to farm-in by funding a minimum of AU$400,000 of exploration within six months and making a AU$50,000 cash payment to Legacy Minerals.

Upon exercising the option to farm-in, it can then earn an initial 75% stake in the venture by sole funding AU$5 million of exploration within five years, including a minimum of 3,000 meters of drilling.

If Rio Tinto Exploration decides to earn the additional 5% interest, taking its stake to 80%, it will sole fund a further AU$20 million of exploration within a further five years, including at least 7,000 meters of drilling or the definition of a mineral resource with at least 500,000 tonnes of contained copper or copper-equivalent.

Legacy Minerals' shares fell 2% in early trading on Monday.