(Adds details on project location, size)
By Susan Taylor
TORONTO, Aug 27 (Reuters) - Goldcorp Inc and Teck Resources Ltd will form a joint venture to develop neighboring mines in Chile to cut costs as metal prices languish at multiyear lows, the Canadian miners said on Thursday.
Named Project Corridor, the combination of Goldcorp's El Morro gold and copper project with Teck's Relincho copper and molybdenum mine targets initial capital costs of $3.5 billion to bring the properties to production. Earlier studies put El Morro's development cost at $3.9 billion and Relincho's at $4.5 billion.
Under the development plan, a conveyor will transport ore from El Morro to a single line mill at Relincho. The two projects are about 40 kilometers (25 miles) apart, in the Huasco Province in Chile.
Mining executives have spoken for years about the benefits of teaming up on projects, but weak metal prices and soaring development costs in recent years have made joint ventures even more attractive.
Goldcorp Chief Executive Officer Chuck Jeannes told Reuters last year that developing El Morro and Relincho with Teck was "the kind of thing one might want to look at."
With a single desalination plant, port, transmission line and concentrator, the joint venture will reduce infrastructure requirements, the companies said in a statement. The two mines will also use a common tailings facility at the Relincho site.
A phased mine construction will also allow future expansions to be funded from project cash flows, reducing initial funding requirements, the companies said.
Also on Thursday, Goldcorp said it had acquired the 30 percent interest in El Morro that it did not own from New Gold Inc for $90 million in cash and a 4 percent gold stream on future production.
El Morro contains about 8.9 million ounces of proven and probable gold reserves and about 6.5 billion pounds of copper. Relincho contains 10.1 billion pounds of proven and probable copper reserves and 464 million pounds of molybdenum.
Goldcorp withdrew its environmental impact study for El Morro last November after Chile's Supreme Court halted development, saying local indigenous groups that oppose it must be better consulted.
The company said at the time that it would focus on a new development plan for the project that meets its target for investment returns. (Reporting by Susan Taylor; Editing by Lisa Von Ahn)