The conditions for the development of the Simandou high-grade iron ore project in Guinea have been met

The Board of directors of Simfer, a subsidiary of Rio Tinto in Guinea, recently approved Simfer's investment in rail and port infrastructure construction projects jointly developed with Simandou Alliance, China Baowu and the Republic of Guinea, and contributed in proportion to the shares. The new Trans-Guinea multi-purpose railway, with a total length of more than 600 km, will, together with other port infrastructure, form the basis for Simfer and Win Alliance to export up to 120 million tonnes of iron ore per year from their respective concessions in Simandou, south-eastern Guinea, and will be the largest greenfield integrated mine and infrastructure investment project in Africa.

Under the terms of the deal, Simfer will take a stake in the companies that build the alliance's rail and port infrastructure projects, commit to complete part of the construction itself and bear its share of the total cost of jointly developing the infrastructure, which is approximately $6.5 billion (Rio Tinto Group's share is approximately $3.5 billion).
Chinalco Iron Ore Holdings Limited (CIOH) has now paid Simfer its share of the capital expenditure required to advance key works until completion, with the first payment of approximately US $410 million, which was paid on June 28, 2024 for related expenditure up to the end of 2023; The second payment, approximately $575 million, was made on July 11, 2024, for related expenditures through 2024. All expenditures incurred to date have been settled.
The cost of jointly developing the infrastructure capacity of the Simandou project and associated construction will be shared between Simfer and Win Alliance. Simfer will develop Blocks 3 and 4 of the Simandou project, owning and operating a mine with an annual capacity of 60 million tons, while Winning Alliance will be responsible for the development of blocks 1 and 2.
According to the joint development agreement, Simfer and Win Alliance will be responsible for different infrastructure construction, giving full play to their respective advantages. Simfer will build a 70-kilometer-long Simfer feeder railway and a TSV port with an annual capacity of 60 million tons; The Union will build about 536 kilometers of double-track railway main line and about 16 kilometers of branch railway, as well as a barge port with an annual capacity of 60 million tons. Upon completion, all jointly developed infrastructure and rolling stock will be transferred to the operation of the Trans-Guinea Corporation (CTG), in which Simfer and the Winning Union each hold a 42.5% stake, with the Guinean government holding a 15% stake.
The Simfer operated mine is expected to achieve first production in 2025 and gradually ramp up to 60 million tonnes of annual capacity (Rio Tinto's interest is 27 million tonnes) within 30 months. The mine will initially produce a single concentrate product and will subsequently transition to a dual concentrate product suitable for blast furnace and direct reduction process production.
Simfer's overall capital requirements for the Simandou project are about $11.6 billion, of which Rio Tinto's share is about $6.2 billion.

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