Simandou iron ore project secures $15 billion in financing

The Government of Guinea has announced that the shareholders of Simandou, one of the world’s largest iron ore deposits, have signed a $15 billion financing agreement for the iron ore project. This is reported by Mining.com.

The funds will be used to develop railway and port infrastructure to be built by Compagnie du Trans-Guinéen, a joint venture owned 15% by the Government of Guinea and 42.5% by Rio Tinto Group, together with Chinese investors and the Simandou Winning Consortium (funded by China).

The agreement was signed on April 2, 2024, following the approval of the transitional parliament of Guinea and Chinese regulators.

«Simandou is no longer a dream, but a reality. There is no doubt that the project will be delivered on schedule by the end of December 2025,» said Djiba Diakite, chairman of the strategic committee.

The Simandou project has been discussed for years, and its commissioning has been delayed due to legal disputes and the complexity and cost of infrastructure construction.

Guinea’s transitional government banned the mine’s commissioning in July 2022. Thus, the authorities planned to force the shareholders, including Rio Tinto, Aluminium Corporation of China, China Baowu Steel and Winning Consortium, to agree on the terms of a joint venture.

In March 2024, the Guinean authorities and Simandou shareholders finally agreed on the terms of joint iron ore mining. Work is expected to begin in March 2023.

This project will be the world’s largest new mine with the highest iron ore content and will add about 5% of the world’s marine iron ore reserves.