China-backed JV wins $14bn iron ore deal at Guinea’s Simandou

By Daniel Brightmore
A consortium representing Chinese, French and Singaporean interests has won a $14bn tender to develop part of Guinea’s Simandou iron ore project, edgi...

A consortium representing Chinese, French and Singaporean interests has won a $14bn tender to develop part of Guinea’s Simandou iron ore project, edging out rival Fortescue.

Reuters report that the consortium, which includes Société Minière de Boké (SMB) and Singapore’s Winning Shipping as well as Guinean government interests - has committed to develop blocks 1 and 2 of the largest known deposit of its kind, holding more than 2 billion tonnes of high-grade ore.

Rio Tinto holds a 45% stake in blocks three and four of Simandou, which it is planning to develop. State-controlled Chinalco owns 40% and the Guinea government 15%. 

Guinea has sought to develop the Simandou deposit for decades, but the project has been mired in protracted legal disputes and the high costs have curbed interest.

The government required the winning bidder to build a 650 km (400 mile) railway and deepwater port to transport the ore from the remote southeastern corner of Guinea to the coast for export, deterring some miners from bidding.

SEE ALSO:

Overcoming challenges in Guinea's mining sector

Rio Tinto renews work on Simandou iron ore project in Guinea

Rio Tinto Inks $20-Billion Deal for Simandou Mine

Read the latest issue of Mining Global here

“The Simandou Project will be crucial for Guinea’s future. This mega deposit is an opportunity in terms of employment and wealth creation for the whole country,” said Sun Xiushun, the SMB-Winning consortium’s chief executive.

A commitment to build the railway dubbed the ‘Transguinéen’ was pivotal in the decision to grant the blocks to SMB-Winning, Guinea’s mining minister Abdoulaye Magassouba told Reuters.

Investors in the relatively little-known winning consortium include Chinese aluminium producer Shandong Weiqiao, a unit of China Hongqiao and Yantai Port Group, as well as Guinea’s government. The consortium is Guinea’s leading exporter of bauxite, an aluminium ore. 

Magassouba said the government would now thrash out the technical details of the deal with SMB-Winning and put the resulting agreement to a vote in parliament. SMB-Winning aims to bring the deposit to production within five years of the agreement being ratified.

Share

Featured Articles

China increases copper import pace, following price plummet

In August, China reached a 26% rise - representing a 100,000+ tonne increase - in copper imports year-on-year, largely driven by product price drops

Ford criticises “inefficient” government mining permissions

In a letter to the US Department of the Interior, the car giant Ford has asked the American government to speed up its current mining permission process

Aggreko and Labyrinth Resources’ sustainable power project

Labyrinth Resources has been working with Aggreko to complete a virtual pipeline power project, which is designed to aid the sustainable energy transition

Despite regional ban, crypto miner Canaan doubles profits

Digital Mining

The future of all-electric sustainable mining technologies

Sustainability

Anglo American first half earnings decline 28 percent

Supply Chain & Operations