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TORONTO - Lundin Mining Corp. (TSX:LUN.TO - News) says it has decided against a purchase option agreement to acquire a majority interest in a Spanish copper project for $79 million.

The Toronto-based miner said Tuesday it reviewed the Touro copper project in northern Spain and has determined the project wouldn't provide sufficient returns to make an investment economically viable.

"Despite the diligent efforts of our team and the co-operation of the authorities, the local community and the owners of the Project, we unfortunately are not able to progress with the Touro project," Paul Conibear, president and CEO of Lundin said in a release.

The company announced in April it had signed a deal with two Spanish companies for an option to buy an 80 per cent stake for euro60 million (C$79 million).

The Touro Project consists of 205 mining claims encompassing 57.4 square kilometres.

Lundin has operations in Portugal, Sweden, Spain and Ireland and an equity stake in the Tenke Fungurume copper and cobalt mine in the Democratic Republic of Congo. It produces copper, zinc, lead and nickel.

Lundin said earlier this year it expects its capital spending this year to be $370 million, $40 million less than its previous estimate in December.