Freeport-McMoRan (FCX) said it plans to sell a 13% ownership interest in its Morenci unincorporated joint venture to Sumitomo Metal Mining (SMM) for $1 billion in cash.

“We are pleased to expand our partnership at Morenci with Sumitomo. This transaction represents an important initial step toward our objective to accelerate debt reduction and restores our balance sheet, while retaining a portfolio of high-quality assets and resources,” said Richard C. Adkerson, president and CEO, Freepot-McMoRan. “Our Morenci partnership with Sumitomo was first established 30 years ago and both companies are confident of the operation’s long-term future. With its long-lived reserves, substantial resource position, attractive cost structure and best-in-class operating team, the Morenci joint venture is positioned to be a continuing strong contributor to the success of FCX and Sumitomo.”

The Morenci unincorporated joint venture is currently owned 85% by Freeport and 15% by Sumitomo Metal Mining Arizona (SMMAz). SMMAz is owned 80% by SMM and 20% by Sumitomo Corp. Following completion of the transaction, the joint venture will be owned 72% by Freeport, 15% by SMMAz, and 13% by an affiliate that is fully owned by SMM.

As of December 31, Freeport’s 85% share of consolidated recoverable reserves totaled 12 billion lb of copper and its 85% share of 2015 production was about 900 million lb of copper. In 2015, Freeport’s 85% share of Morenci revenues totaled $2.2 billion and production and delivery costs totaled $1.5 billion. The transaction is expected to close in mid-2016, subject to regulatory approvals and customary closing conditions.