Mining giant Rio Tinto scraps $20 billion iron ore project following price slump
Rio Tinto has shelved plans for a $20billion Simandou iron ore project in Guinea due to a global oversupply of iron ore, announced the company’s new Chief Executive Jean-Sebastian Jacques.
The company has been seeking financing for Simandou, despite a $1.1billion write-down in February this year.
Jacques told The Times that the project, which would have included a 650 kilometre railway, is simply inviable at this time.
The country’s minister of mines however, has said in a statement that plans are in place to pursue the project despite Rio Tinto’s decision.
"Despite the challenge of financing the project, we believe that a financing solution will be found with partners who share our long-term perspective," it said.
The project was expected to generate around $7.5 billion in revenue, with an additional $5.6 billion contributed to Guinea’s GDP.
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