In Addition to Simandou, Rio Tinto and Subsidiary, Simfer, Close Deal on New Mining Port and Rail Line
The prospect of a more restrictive Guinean mining code continues to encourage companies to cut deals in advance, bringing lucrative amounts of money into government coffers. Not a bad strategy for a cash-strapped Guinean treasury.
News – April 27, 2011
Port Technology reports that a new mining port is to be constructed in the West African country of Guinea as part of an agreement signed by Rio Tinto, its subsidiary Simfer S.A. (Simfer), and the Government of Guinea.
The agreement will see mining group Rio Tinto pay the Guinean public treasury £424.7 million to grant mining concessions in the country.
The deal will also see the mining giant and the Guinean government in a joint venture, with the build of the neccessary infrastructure to enable iron ore shipments to begin by mid-2015 in the Simando region of the country.
The infrastructure includes a new rail line through Guinea as well as athenew Guinean port. The infrastructure will be jointly owned by the Government of Guinea and the other Simfer partners, with the Government able to hold a maximum stake of 51 per cent.
The new infrastructure joint venture will appoint Simfer as operator as both the rail and port developments, with the infrastructure reverting to Government ownership once it is fully amortised, after 25 and before 30 years.