Simandou Suspended By Guinea's Military Government?

Guinea's interim President Mamadi Doubuya on Thursday demanded a halt to all activities at simandou iron mine, foreign media reported.

According to the local website Guineematin.com, the junta spokesman Diallo released the minutes of the March 10 meeting of guinea's Council of Ministers. Colonel Doubuya, Chairman of the National Unity and Development Council, Transitional President, Head of State and Supreme Commander of the Army, attended and addressed the meeting. He said he had asked for the simandou deposit to be mined because of Guinea's interests. Unfortunately, despite his request from December 2021, no progress has been made so far. He therefore directed that all activities on the ground be suspended pending answers to the questions posed by the participants to clarify how Guinea's interests would be protected.

Simandou, in the remote south-eastern corner of Guinea, is the largest known deposit of its kind, containing more than 2bn tonnes of high-grade ore. Rio owns 45.05 per cent of Simandou blocks 3 and 4, Chinalco 39.95 per cent and the Government of Guinea 15 per cent. Blocks 1 and 2 are controlled by the Chinese-backed Win Alliance, a consortium that is developing the mine and related infrastructure.

Reuters quoted a source in Guinea's mining ministry as saying the colonel had pressed Rio tinto and The Alliance to see the owners of the four blocks "co-operate". Such co-operation could involve the construction of the Transguineen, a 670-kilometre rail line to transport ore to deep-water coastal ports. Only The Win Alliance is currently in charge of building the railway within five years, with the goal of starting iron ore production in 2025 and shipping by the end of 2026, and has yet to agree on possible sharing of the route with other companies.

Eric Humphery-Smith, an analyst at Verisk Maplecroft, said: "This could be an attempt to push simandou's northern and southern partners to work more closely on infrastructure, but the two sides are still far from an agreement on this."

Analysts at CRU Group estimate Simandou could eventually produce 150m tonnes of iron ore a year, making Guinea the world's third-largest exporter after Australia (900m tonnes a year) and Brazil (360m tonnes a year).

Rio Tinto said on Friday it would not make any public comment on Guinea's move at this stage, Reuters reported. Win and Chinalco did not immediately respond to requests for comment.