A multinational company has agreed to back a mega mining development.
Rio Tinto confirmed it is still proceeding with its majority owned US$20 billion (A$26.7B) Simandou Project, 526km southeast of Conakry.
“Rio Tinto and Chinalco, which respectively owns 45.05 per cent and 39.95 per cent of Simandou, will continue to work with the government of Guinea [which owns a 15 per cent stake] to explore other options to realise value from the world-class Simandou iron ore deposit,” a Rio spokesperson said in a public statement.
“The non-binding heads of agreement, originally signed on 28 October 2016, for Chinalco to acquire Rio Tinto’s entire interest in the Simandou Iron Ore Project in Guinea has lapsed.”
The proposed mine is so large it is also owned by Chinalco and the Guinean government appointed SBM-Winning Consortium Simandou (WCS). The site is home to one of the world’s “best undeveloped” mineral deposits, and widely speculated to be resource-rich enough to devalue, compete against and possibly replace Western Australia’s Pilbara exports.
The latest pact includes constructing a 670km railway, associated infrastructure and both mine and port facilities before the end of 2024. On completion the operation would produce up to 150 million tonnes a year of product from a combined 2B tonnes at 65 per cent grade. It would also create an estimated 45,000 jobs.
At the time of publication, the project was stalled due to mounting costs, legal challenges and corruption allegations according to News Limited.
“We look forward to continuing to work with the government and WCS to finalise a definitive agreement aligned with this framework, which brings us a step closer to achieving mutual prosperity for Guinea and all stakeholders,” Rio international copper president Bold Baatar said according to the media outlet.
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