China wants to take over the world’s largest undeveloped iron ore project
A private group of Chinese magnates is planning to take Guinea’s Simandou, the world’s largest undeveloped iron ore project, from Rio Tinto (NYSE:RIO), reports The Australian.
According to The Sunday Times, China International Fund (CIF) and Angola’s state oil company would propose to take ownership of Simandou from Rio by having the Chinese-controlled and London-listed Bellzone Mining Plc (LON:BZM) offer Guinea $700 million in cash. The amount is equivalent to the sum Rio paid the West African country under an agreement reached last year.
But the World Bank’s private sector development financing arm, International Finance Corporation, is coming to Rio’s recue.
The Washington-based IFC, which acquired its stake in Simandou in 2006, has announced today its plans to invest $150 million of equity in the highly wanted project, as the joint venture between Rio and China’s Chalco races towards first production.
Rio Tinto has been exploring in Guinea since 1996, but intensified its plans for building Africa’s biggest mining development at Simandou in 2007, when markets were thriving and BHP Billiton tried an unsuccessful hostile $135 billion purchase offer.
Although the Anglo-Australian miner intended to be in production by next year, financial difficulties and the previous Guinea government’s decision to strip half of Rio’s tenements, threatening the one that holds the Simandou deposit, have delayed it.
The company is developing a railway, a mine and a port in order to ship its first cargo of the steelmaking raw ingredient by mid-2015, increasing iron ore output to 95 million metric tons a year from Simandou in the future.
Simandou will turn Guinea into the world’s third-largest iron ore producer after Australia and Brazil.
More News
California start-up launches next-generation magnesium production technology
May 28, 2025 | 03:09 pm
{{ commodity.name }}
{{ post.title }}
{{ post.date }}
8 Comments
Glenn Woodley
Western Australia is a large iron ore supply state. contrary to the likes of mining companies who wish to remove profits offshore, and to other countries, 1/ the resource is part of the host country 2/ the resource should be taxed by the state in which it is in 3/ it should not be ferried off to the Eastern States because they think the funds should be population based,- what does Victoria produce? – Western Australia gives them 2bn dollars?
I am 64 years old and all I can see from the so called mining boom is (sure we ride a recession) more cars on the road, more crime, NO money gone to the infrastructure of ele viating IMM “our now overpopulated third world life style”. I see MORE cars on the road some referring to the people smugglers with a map of Australia & wording “f—ck” off were full”
I SAY FULL OF THIEVES!!!??? you cannot even leave trade tools in your ute or trailer, you have to lock everything, & I mean every thing, yes so called multi-culturism has done little to improve our lifestyle, maybe the odd Chinese restaurant. The Federal Government doesn’t even set up work programs for the grinning boat people, who receive for doing nothing 4x the aged pension & so called trauma money, now I believe they don’t even have to go to detention centres,, they are laughing all the way, and more will come.
The Indonesians have from memory schedule 24, which not only taxes the mines but it increases the Govt. control & input, so world mining beware!
When a lifestyle changes some call it “progress”, I call it “regress”, not being negative, it is being a realist. Yes change the foreshore on the river, a “false so called modernisation,” ‘look at us’ BS
We might get additional trains in 5 years time, our deficit is a “quarter of a trillion dollars”, so where is the mining money??? China progresses because it has control, more than what a so called “free enterprise society can do”
Jgaugui
When will a French version of MINING.com will be developed and launched?
JGauthier Cert. Trans.
Amey Zhu
excellent
Bnorwell
Not
Crickers66
What a dangerous person Mr Woodley is. Lucky there is a big sandy desert between him and a more multi cultural / tolerant Australia. Your expurgated language is wholly offensive in this industry forum. Please revise the thoughts that you choose to publish.
William
The people of Guinea must secure 50% of profit from this type of projects because the world need more iron ore today ever than before. If they allow China to take over that project, The Chinese will make their investment money back within the first five years and the rest of the years to come will be massive profit for the Chinese. Therefore, i will caution the people of Guinea to set a term limited for this investment contract and sign a clause stating that, if the Chinese make a certain amount of profit, the people of Guinea must get paid more. On the other hand, i will advise the people of Guinea to take a loan and develop that project by themselves so that they manage their own wealth.
Robert Fischer
Just curious on how Guinean people will benefit from this mineral resource? Or is Guinea another country suffering under the resource curse? What has been put in place to avoid this and maximise the local benefits?
MINING.com Editors
Excellent questions, Robert! I’ll try answering them in a follow up article.