Rio Tinto has announced significant progress in its Simandou iron-ore project, thanks to key agreements with Guinea and the Winning Consortium Simandou (WCS). These agreements relate to the development of the trans-Guinean infrastructure required for the project. This marks a significant milestone towards the full sanction of the Simandou project, which is set to become the world’s largest known undeveloped supply of high-grade, low-impurity iron-ore.
Under the agreements, Rio Tinto’s joint venture partners, Simfer SA and WCS, will co-develop over 600 km of new multi-use rail and port facilities to facilitate the exportation of iron-ore from the Simandou mining concessions in southeastern Guinea. The infrastructure capacity and associated costs will be divided equally between Simfer, which is developing blocks 3 and 4 of the project, and WCS, which is responsible for blocks 1 and 2. Furthermore, China Baowu Steel Group has expressed interest in partnering with WCS for blocks 1 and 2, as well as the infrastructure joint venture.
Bold Baatar, Rio Tinto’s copper chief and executive committee lead for Guinea, expressed optimism about the project, stating, With these agreements, we have reached an important milestone towards full sanction of the Simandou project, bringing together the complementary strengths and expertise of Rio Tinto and our partners…the infrastructure that will unlock this world-class resource.
However, the co-development convention must first be ratified by the government of Guinea and satisfy several conditions before it can proceed. These conditions include the government’s approval of the final feasibility study for the project. Negotiations are ongoing between the partners to finalize the investment agreements and related shareholders’ agreements necessary to support the co-development.
The Simandou iron-ore project will enhance Rio Tinto’s existing portfolio, which includes the Pilbara and Iron Ore Company of Canada products. It is expected to significantly strengthen the company’s position in the global iron-ore market. The project’s critical path works are continuing, aiming to maximize progress during the 2023-24 dry season.
