On 18 August 2014, the Simandou Project Investment Framework between the State of Guinea and the Project Partners became effective. The Investment Framework provides the legal and commercial basis for investment in the development of the mineral resource at Simandou, and in associated rail and port infrastructure.
Through provisions relating to third-party use of this infrastructure, as well as State obligations to institutionalise enabling structures for capital intensive investments, the Simandou Investment Framework supports the State’s strategic objectives regarding the development of Guinea’s mineral resources and economy.
The Investment Framework is comprised of two ratified Conventions, each with the force of Guinean law, covering the Simandou Mining Project and Infrastructure Project. The two Conventions govern, among other things, the relationships between Simfer S.A., the Infrastructure Owner, the Infrastructure Operator, and the State.
The Build Operate Transfer (BOT) Convention sets out the legal and commercial basis on which the rail & port infrastructure will be constructed, operated and ultimately transferred to the State 30 years after the commencement of iron ore shipments. The Amended and Consolidated Convention de Base (Basic Convention) is focused on the legal and commercial basis investment for developing the iron ore mineral resource at Simandou.
As outlined in the graphic below, the Simandou Project will be restructured into separate entities for the Mining Activities (Simfer, also referred to as MineCo), and for the Infrastructure Activities (also referred to as InfraCo; collectively the Infrastructure Owner and the Infrastructure Operator).