The project has the capacity to contribute to the transformation of the Guinean economy and the country’s transport infrastructure.
Thanks to massive investment in infrastructure, this project is critical to the Guinean people. This is a national priority that goes beyond the mines and that will have repercussions for generations – Alpha Condé, President of the Republic of Guinea
The project comprises three main components:
- A deposit (blocks 3 and 4 of Simandou) of highly competitive, high grade iron ore (65.5% Fe), with an annual production capacity of 100 million tons during full production for a period of 40 years;
- A new 650km multi-user railway linking South East Guinea with the coast, along the “Southern Growth Corridor”;
- A new multi-user deep-water port, which will be the first in Guinea to provide access to large cargo ships.
China and Guinea have long enjoyed strong relations. The two countries are highly complementary economically. Guinea has vast iron ore resources, while China is the largest consumer of this mineral in the world – Chinalco
In full production, the project will have the potential to double the current GDP of Guinea. It will also have a significant impact on the labour market, generating about 45,000 jobs in all spheres of the economy. It will also create subcontracting and procurement activities.
With related infrastructure, the project will stimulate all of the Guinean economy and the “Southern Growth Corridor” through agriculture, forestry, animal husbandry and trade. The construction and improvement of roads, development of optical fiber and wireless communication networks will indirectly support the economic development of communities that are along the route’s infrastructure.
We are taking an important step in the development of these world class iron ore resources, which will benefit all shareholders and Guineans – Sam Walsh, CEO of Rio Tinto
The project partners are the Republic of Guinea (7.5%), Aluminum Corporation of China (Chinalco) (41.3%), Rio Tinto (46.57%) and the International Finance Corporation (IFC, World Bank group) (4.625%).
The signing and ratification of the Investment Framework in 2014 marked an important step and established the legal and commercial foundations for the future of the project.
This project is a priority for IFC because it will create jobs and infrastructure and generate revenue for Guinea. Projects of this magnitude require strong partnerships – Jin-Yong Cai, Executive Vice President and CEO of IFC (World Bank Group), May 2014
The project partners submitted the first bankable feasibility study (BFS) for rail and port infrastructure project to the Guinean government in December 2015.
The parties are to work together to form a consortium of investors that will finance, build and maintain multi-purpose and multi-user infrastructure within the agreed timeframe and within the terms set by the feasibility study.