Simandou is a world-class iron ore mining project located in south-east Guinea, West Africa.
It will be the largest integrated iron ore mine and infrastructure project ever developed in Africa, with the potential to transform the Guinean economy and transport infrastructure.
The Simandou Project is planned to comprise three principal components:
- a 95 million tonnes per year-capacity iron ore mine in the Simandou Range in south-eastern Guinea;
- a Trans-Guinean railway of approximately 650km to transport the ore from the mining concession to the Guinean coast; and
- a new deepwater port currently planned to be located south of Conakry in the Forécariah prefecture.
The concession licence-holder and project company is Simfer S.A., which is currently owned 95 per cent by Rio Tinto and 5 per cent by the International Finance Corporation (IFC), a member of the World Bank Group.
In July 2010, Rio Tinto and Chinalco subsidiary Chalco signed a binding agreement to establish a joint venture covering the development and operation of the Simandou Project.
The Government of Guinea and Simfer S.A. signed a Settlement Agreement in April 2011, which confirms Simfer S.A. title to a southern concession of Simandou (known as blocks 3 and 4). The Settlement Agreement provides the Government of Guinea with the right to take a stake of up to 35 per cent in Simfer S.A. (the mine) and a 51 per cent stake in a special purpose vehicle to build, own and operate project (rail and port) infrastructure. The Settlement Agreement acknowledges participation by Chinalco through a joint venture with Rio Tinto.
Rio Tinto is focusing on developing Simandou with high standards of health, safety, sustainability, environmental responsibility and corporate governance.
The project is already creating jobs, improving infrastructure, increasing economic development and bringing international expertise to Guinea. It will also enhance environmental conservation and social development, and generate money for local economic development in one of the poorest parts of Guinea.
Rio Tinto is making a great effort at Simandou to ensure that economic activities related to exploration and development maintain environmental quality and foster economic prosperity and social wellbeing. The mining operations and rail link will have a positive effect on the Guinean economy and represent one of the biggest foreign investments West Africa has seen in many years.
Simfer S.A. submitted the Social and Environmental Impact Assessment (SEIA) for the Mine and Rail components of the Simandou Project to the Government in September 2012. The SEIA has recorded baseline conditions to enable ongoing assessment of the impact of the mine, rail and port development.
The prospect of an environmentally sensitive mining development at Simandou presents a challenge but also an opportunity to integrate poverty alleviation, rural development and biodiversity management.
Rio Tinto began extensive biodiversity studies in Guinea in 1997. In 2002 and 2003 the Group embarked on a new round of biodiversity field work with experts from Conservation International. In 2008, Rio Tinto continued to advance extensive flora and fauna studies with the Royal Botanic Gardens, Kew.
More recently the results of these detailed studies have been superimposed on the project's mine plan to enable engineers to take into account biodiversity considerations when designing the structure of the operations.
To ensure biodiversity management, Rio Tinto conducted social and environmental programmes from the outset. These have aimed at enhancing the benefits of the project for the local communities, while minimising potential adverse impacts. Initiatives include:
- Identification and assessment of local communities
- Community discussion on improving quality of life
- Establishing a fund based on mining revenue to finance local development projects
The Guinea Buy Local Program (GBLP) is Rio Tinto's initiative to take proactive measures to contribute to the economic and social development of Guinea.
Rio Tinto has signed a cooperation agreement with the IFC, a member of the World Bank Group the largest global development institution focused on the private sector. Through this agreement, the IFC brings its experience and knowledge of worldwide emerging markets to support the implementation of the GBLP.