Guinea Requires Domestic Processing of Simandou Iron Ore

According to a report on Mining.com, Rio Tinto may be forced to invest heavily in building downstream facilities due to the Guinean military government's push for local processing of the giant Simandou iron ore mine.

The authorities of this West African country, which came to power in 2021, have required miners to submit plans for the construction of domestic processing facilities. Officials stated that refineries are crucial for Guinea to gain more resource revenues to drive economic development in more sectors.

In recent years, many African countries have pressured miners to carry out domestic mineral processing. Therefore, Guinea's policy is not an isolated case. As the world's second-largest bauxite producer, Guinea has already canceled agreements with some miners, including Emirates Global Aluminium, on the grounds that the enterprise was slow in building an aluminum plant.

Guinea's Minister of Planning and International Cooperation, Ismael Nabe, stated that the strategy is clear: ore mined in this country must also be processed here.

Nabe told the Financial Times, "We need to build refineries. This is our strategic plan."

The Simandou iron ore mine is divided into four blocks. Blocks 1 and 2 are being developed by the Winning Consortium, while Blocks 3 and 4 are being developed by a joint venture led by Rio Tinto.

Nabe compared Guinea's ambitious goals to the iron ore mining boom in Western Australia a decade ago, emphasizing that mining revenues should also support agriculture, education, and infrastructure.

Simandou will become the world's largest and highest-grade new mine, ultimately capable of producing 120 million mt of high-grade iron ore annually. The mine is expected to commence production in November this year.

Rio Tinto first obtained the exploration permit for Simandou in 1997, but political instability in the country has affected the project's progress. The project has experienced two military coups, four national leaders, and three presidential elections.

The development of the Simandou iron ore mine includes a 600-kilometer railway line connecting the mine to Guinea's deep-water Atlantic port.

Rio Tinto will operate one of the two mines in the project.