TORONTO (Reuters) -Canadian copper miner First Quantum Minerals on Wednesday said it agreed to sell a 30% stake in its Ravensthorpe nickel mine in Western Australia to South Korean steel maker POSCO for $240 million.

First Quantum said it and Posco have also agreed to evaluate a strategic partnership to produce battery precursor materials from production at the mine.

Under the deal, POSCO will receive a long-term offtake agreement for 7,500 tonnes of nickel in mixed nickel-cobalt hydroxide precipitate per year produced at Ravensthorpe, beginning in 2024.

Ravensthorpe is a large-scale, open pit nickel and cobalt operation located in Western Australia. Nickel production last year was 12,695 tonnes.

First Quantum said proceeds would repay debt.

The deal is subject to approval by the Australian Foreign Investment Review Board and is expected to close in the third quarter of 2021.

(Reporting by Jeff Lewis; Editing by Andrea Ricci)