Changes to Simandou Ore Reserves and Mineral Resources
Rio Tinto’s 2017 annual report, released to the market today, includes a write back of Ore Reserves to Mineral Resources at the Simandou iron ore project, in Guinea.
The updated Mineral Resources are reported in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, 2012 (JORC Code) and the ASX Listing Rules. Supporting information relating to the change is set out in this release and its appendix. Mineral Resources are quoted on a 100 per cent basis. Rio Tinto’s interest in the Simandou iron ore project is 45.05 per cent, with Chinalco (39.95 per cent) and the Republic of Guinea (15 per cent).
On 28 October 2016, Rio Tinto and Chinalco signed a non-binding agreement to sell Rio Tinto’s entire stake in the Simandou project, in Guinea, to Chinalco. The Heads of Agreement (HOA) set out the proposed principal terms of the sale with the aim of signing a binding agreement.
Considering current uncertainties in timing of development and potential variations to project scope under future project ownership, the project Ore Reserves have been written back to Mineral Resources.
Accordingly, estimates of Mineral Resources at Simandou have been increased, compared to the previous estimate in the 2016 annual report. The Simandou Mineral Resources have increased by 1922 Mt, from 835 Mt to 2757 Mt.
Tenure under the Simandou Mining Concession is held by Simfer SA, which is owned jointly by Rio Tinto, Chinalco and the Republic of Guinea. The Concession duration is 25 years, renewed automatically for a further period of 25 years followed by further 10 year periods in accordance with the Guinean Mining Code, provided Simfer has complied with its obligations under the Amended and Consolidated Basic Convention entered into with the Republic of Guinea, dated 26 May 2014.