Name of the Project
Simandou iron-ore project.

Location
Guinea.

Project Owner/s
Simfer is a joint venture owned by the government of Guinea, Rio Tinto, the Aluminium Corp of China (Chinalco) and Chinese-backed SMB-Winning Consortium (WCS).

Rio Tinto owns a 45.05% stake in the southern half, blocks 3 and 4, of the Simandou deposit, with Chinalco holding 39.95% and the Guinea government the remaining 15%. WCS was awarded a government tender in November 2019 for Blocks 1 and 2.

La Compagnie du TransGuinéen (TransGuinean Company) joint venture (JV), comprising Rio Tinto, WCS and the Guinea government, will be the central structure for the co-development of the rail and the port components of the Simandou iron-ore development project.

Project Description
The Simandou project comprises three core elements – a mine, railway and port, as well as associated infrastructure.

There will be an openpit iron-ore operation in the Simandou range, in south-eastern Guinea, with an expected peak production of between 95-million and 100-million tonnes a year.

Simandou blocks 1 and 2 are expected to produce 60-million tonnes a year and Rio's blocks 3 and 4 about 40-million tonnes a year.

The project includes an estimated 670 km railway to transport the iron-ore from the mine to the Guinean coast and a new deep-water port south of Conakry, on the Morebaya river.

Associated developments to provide utilities and supporting infrastructure for the project include construction facilities, access to materials, power generation, water, access roads and accommodation.

New infrastructure will become State property upon completion.

Construction of the project will be undertaken in two stages.

The first stage will develop the southern Ouelaba mine site, which will include the construction of the railway and port to a capacity of about 60-million tonnes a year.

The second stage will bring the northern Pic de Fon mine site on line and expand the capacity of rail and port facilities, increasing production to between 95-million and 100-million tonnes a year.

The mine will be the biggest integrated mine-and-infrastructure project ever developed in Africa.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
Not stated.

Capital Expenditure
A Rio Tinto engineering study conducted on the project estimates capital expenditure at $18.3-billion.

Planned Start/End Date
The first shipment of ore was initially expected by 2015; however, development of the project has been postponed several times.

Latest Developments
Development plans for the rail and port infrastructure to service the Simandou iron-ore project have progressed, with the incorporation of the TransGuinean Company JV.

The JV incorporation is a significant milestone in the implementation of the framework agreement signed between the parties in March 2022 and has been fully registered and established in Guinea.

The parties will now work on the next steps, including a shareholding agreement, finalising cost estimates and funding, and securing all necessary approvals and other permits and agreements required to progress the co-development of infrastructures.

Rio noted in its interim results released on July 26 that project activities at Simandou had stopped, following an order from government to stop work in the country.

“We are actively engaging with . . . government and the WCS towards the resumption of formal negotiations. We remain committed to delivering Simandou in accordance with international environmental, social and governance (ESG) standards, ensuring that the project results in sustainable benefits for Guinea and its people, along with our shareholders and customers,” Rio told shareholders.

The port and rail company incorporation paves the way to progress the shareholder agreement and secure the necessary financing to build a strategic corridor, with more than 600 km of rail infrastructures extending from the south to the south-west of the country, as well as port infrastructure in the Forécariah prefecture in Maritime Guinea.

The infrastructure constitutes the backbone of the Simandou project, which presents a significant opportunity for the economic growth of the Republic of Guinea, in addition to the mining activities it will support.

Key Contracts, Suppliers and Consultants
Fluor (construction contractor); and NRW Holdings (earthworks contract).

Contact Details for Project Information
Chinalco, tel +86 10 8229 8103, fax +86 10 8229 8081 or email info@chinalco.com.cn.
Rio Tinto, email media.enquiries@riotinto.com.