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 Guinea's government the remaining 15%. WCS was awarded a government tender in November 2019 for Blocks 1 and 2.

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
News agency Reuters has reported that Guinea' Mines Minister Moussa Magassouba has ordered all work related to the Simandou iron-ore mine project to be halted after the companies involved in the project had missed an extended deadline to agree on a JV.

Rio Tinto and Chinese-backed consortium WCS had showed a "lack of willingness" to work on a partnership, Magassouba said in letter on July 3, according to the agency.

"Despite the significant concessions the Guinean State has been kind enough to make, it is clear the obstruction is being maintained by both your companies, to the detriment of the interests of the project," he wrote.

Guinea's ruling junta suspended construction of the mine and related infrastructure in March, resulting in Rio and WCS’ signing a framework agreement later that month, under which they would "co-develop" infrastructure for the mine.

The government had given the consortium 14 days to agree on a JV, itself an extension of a previous deadline.

The halt will apply across the country.

Neither Rio Tinto nor WCS immediately replied to a request for comment on the latest stoppage Reuters reported.

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.