African iron ore joint venture given green light

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 27 Apr 2012   Posted by admin


THE proposed Guinea-based Simandou iron ore joint venture between Aluminium Corporation of China subsidiary Chalco and iron ore major Rio Tinto has been completed, after receiving all
necessary regulatory approvals from the Chinese Government.
Following an earn-in payment of US$1.35 billion, Chalco now owns 44.65 per cent of the Simandou project; Rio holds the majority 50.35 per cent stake in the venture, while World
Bank Group member International Finance Corporation owns five per cent. The Guinea Government has also retained an option to participate
in the project.
In 2003, Rio signed a Mining Convention agreement with the Guinea Government to develop an iron ore mine in Guinea’s south east. Rio has since invested more than US$700 million in exploration and feasibility studies to develop the mine.
The Simandou iron ore JV will construct a 650km trans-Guinean railway to transport iron ore from the project area to the Guinean coast and a deepwater port south of Conakry. Once developed, the mine is expected to produce about 95 million tonnes per annum of iron ore, with shipment of first ore expected in mid 2015. The mine and associated infrastructure will be the largest iron ore project ever developed in Africa.

 

By Lorna Seatter


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