Guinea reaches deal with miners to resume Simandou iron ore development

Guinea's transitional authorities said this month that the site's development would be paused as they sought clarification on how Guinea's interests would be preserved. Mines Minister Moussa Magassouba said on state television late on Saturday that a framework agreement had been signed between the government and companies involved in the project: Rio Tinto, the Aluminium Corp of China (Chinalco) and the Chinese-backed SMB-Winning consortium.

Guinea's ruing junta has reached an agreement with Rio Tinto and a Chinese-backed consortium to resume activities at the Simandou iron ore deposit, which authorities halted earlier this month, the mines minister said.

Simandou holds more than 2 billion tonnes of high-grade ore, making it the largest known deposit of its kind. It remains untapped decades after its discovery, largely due to legal disputes and political instability. Guinea's transitional authorities said this month that the site's development would be paused as they sought clarification on how Guinea's interests would be preserved.

Mines Minister Moussa Magassouba said on state television late on Saturday that a framework agreement had been signed between the government and companies involved in the project: Rio Tinto, the Aluminium Corp of China (Chinalco), and the Chinese-backed SMB-Winning consortium. He said the companies had "put aside many egos, many other interests to return to what is a win-win partnership for all parties."

Magassouba said infrastructure projects must be completed by December 2024 and commercial production must start by March 31, 2025. The agreement primarily concerned developing a 670 km (419 miles) railway from the Simandou site to a new deepwater port, a plan that Magassouba said would cost about $15 billion.

He said the government had negotiated and obtained 15% stakes in the rail, port, and mines, while the new infrastructure would become Guinean state property upon completion. "This framework agreement will allow the joint development of this gigantic project ... and allow the acceleration of the process and a resumption of work," Fadi Wazni, chairman of SMB-Winning consortium board, said. Geraud Moussarie, country head for Rio Tinto in Guinea, said the agreement was "a historic step in the co-development of the Simandou project."

Rio Tinto has held rights to Simandou since 1997. It owns a 45.05% stake in the southern half, Blocks 3 and 4, of the deposit, with Chinalco holding 39.95% and Guinea's government the remaining 15%. SMB-Winning won a government tender in November 2019 for Blocks 1 and 2.

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