By Rhiannon Hoyle

 

Guinean officials have ordered work be stopped on the Simandou iron-ore project, in which mining giant Rio Tinto PLC has a stake, amid protracted negotiations to agree on a joint venture, a person familiar with the matter said on Tuesday.

Simandou is among the world's largest undeveloped, rich deposits of iron ore--the main ingredient in steel--and has the potential to reshape the global market, which has long been dominated by exports from Australia and Brazil.

Rio Tinto, the world's second-largest mining company by market value, has the rights to develop the southern half of the deposit in partnership with the Guinean government and Aluminium Corp. of China. The Winning Consortium Simandou--which includes Singapore-based Winning International Group and China Hongqiao Group Ltd.--has rights to develop the northern half.

The stop-work order was issued this week after an extended deadline to complete negotiations on a joint venture was missed, the person said.

The military junta in Guinea Conakry last month criticized delays to execute a tripartite agreement reached in late March between the government and the mining companies, and gave them 14 days--an extension on an earlier deadline--to create the joint venture.

The March agreement followed an earlier order to suspend work amid negotiations over the development of infrastructure to enable iron ore produced at the site to be exported.

 

Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com

 

(END) Dow Jones Newswires

July 04, 2022 23:56 ET (03:56 GMT)

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