Guinea: Rio Tinto completes formation of Simandou joint venture with Chalco
AFRICA PRESS RELEASE
Rio Tinto and Chinalco’s listed subsidiary, Chalco, have completed the formation of their joint venture (JV) to develop and operate the Simandou iron ore project in Guinea, following the completion of all Chinese regulatory approvals. As a result, a consortium led by Chalco has made an earn-in payment of US$1.35 billion, in line with an agreement reached with Rio Tinto in March 2010.
Rio Tinto and the Chalco consortium now hold a 53 per cent and 47 per cent interest respectively in the JV which translates into a 50.35 per cent and 44.65 per cent interest in the Simandou project. The remaining five per cent is held by the International Finance Corporation, part of the World Bank. The Government of Guinea retains its options for participation in the project and is expected to take up its first share in the near future.
Rio Tinto signed a Mining Convention with the Government of Guinea in 2003 to develop a Mining Concession at Simandou. To date they have invested more than US$700 million on the exploration and study work necessary to develop a world class mining operation at Simandou.
To fulfill their commitment to sustainable development, they initiated several economic, social and environmental partnerships from the outset of their presence in Guinea. These include a partnership with the International Finance Corporation (IFC), the private sector arm of the World Bank, which owns a 5 per cent stake of the Simandou project.
When the mine goes into full production, Simandou will be the largest integrated iron ore mine and infrastructure project ever developed in Africa and will generate sustainable social and economic gains for Guinea.
About Rio Tinto
Rio Tinto is a leading international mining group headquartered in the UK, combining Rio Tinto plc, a London and New York Stock Exchange listed company, and Rio Tinto Limited, which is listed on the Australian Securities Exchange.
Rio Tinto’s business is finding, mining, and processing mineral resources. Major products are aluminium, copper, diamonds, thermal and metallurgical coal, uranium, gold, industrial minerals (borax, titanium dioxide and salt) and iron ore. Activities span the world and are strongly represented in Australia and North America with significant businesses in Asia, Europe, Africa and South America.