Rio Tinto Committed to Big Guinea Iron-ore Development – exec

  • Saturday, February 8, 2014
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  • Keywords:Iron-ore
[Fellow]Diversified miner Rio Tinto’s CEO of diamonds and
Speaking at the second day of the Investing in African Mining Indaba, in Cape Town, Davies said that the Simandou project, in which Aluminium Corp of China, or Chalco, is also invested, was a “very important investment” for Rio.
The $20-billion project was expected to produce about 100-million tonnes a year of iron-ore, one-third the size of Rio’s Pilbara operations.
Guinean president Alpha Conde had previously flagged 2015 as the start of production from the Simandou project, which has been delayed by years over a deadlock about how the massive project will be financed and executed.
Davies said this week that work was under way to develop the mine, with current estimates suggesting that it could double the size of the Guinean economy.
“While transformations of this scale have on occasion been seen in the oil industry, they have seldom been triggered by a single mining project.
“Simandou will create thousands of jobs, spend hundreds of millions of dollars locally, and make annual payments to government far exceeding the current fiscal revenue,” Davies said.
He added that the infrastructure associated with the project, including a deep-water port, 1 000 km of new and upgraded roads, as well as a railway, would provide further benefits to the country.
Davies also used the opportunity to call on African governments to form a partnership with miners operating in the region, saying governments were critical in providing the stable legal and fiscal frameworks to attract investment and in providing an environment in which businesses could expect an attractive return.
“Different partners bring different strengths to a partnership. What’s absolutely critical is to choose the partners who will work together best to deliver your collective goals.
“Our experience shows this works when there is a mutual respect for each other’s goals and objectives,” he concluded.
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