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| Guinean Gov Urges Rio Tinto To Give Up Half Of Simandou Concession |
| = Rio Tinto to continue working with Guinean Gov to resolve this matter = |
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Rio Tinto announced December 11 that it has received correspondence from the Guinean Minister of Mines which appears to indicate that the Council of Ministers has instructed the Ministry of Mines and Geology to effect a compulsory relinquishment of the northern half of the Simandou Mining Concession whilst confirming Rio Tinto's entitlement to the southern half of that Concession. Rio Tinto has been in active negotiation in good faith with the government of Guinea since August 2008 following receipt of correspondence from the President of Guinea purporting to rescind the Simandou Mining Concession. Rio Tinto remains of the view that it has complied with all its obligations in relation to the Concession such that it is entitled to hold and retain the entire Concession, and will continue working in good faith with the Government of Guinea to seek to resolve this matter on that basis. The Simandou range consists of a sequence of deformed itabirites, phyllites and quartzites within Proterozoic basement rocks. Both the Pic de Fon and Queleba deposits are approximately 7.5 km in length and up to 1 km wide. The two deposits are separated by approximately 4 km in a north-south direction along the Simandou range. Rio Tinto has drilled over 500 reverse circulation and diamond drill holes (approximately 93,000 m) at both deposits. Very high-grade iron ore mineralization has been intersected to over 300 m depth at both deposits. Rio Tinto is planning the development of its first production phase of 70 million tonnes per annum, potentially rising to 170 million tonnes per annum, subject to agreement with the government of Guinea. The Concession was held 95% by Rio Tinto, with the remaining 5% by the International Finance Corporation (IFC). The government of Guinea retained an option to purchase up to a 20% interest in the Simandou project. <References provided by Rio Tinto on the Simandou Project> -- Rio Tinto has already spent US$300 million on work to develop a long-life mine at Simandou, and expects to have spent over US$400 million by the end of 2008. At present, Rio Tinto is spending US$20 million per month on drilling and support. -- The Simandou project employs more than 1,800 people in Guinea (including full-time employees and contractors). More than 90% of the workforce is Guinean. -- Rio Tinto's exploration and development efforts are focused on the totality of its 738 square kilometer Simandou mining concession area, which represents only 18% of mining holdings in the Simandou range. |
| last modified : Thu 18 Dec, 2008 [10:29] |
