Guinea: SMB-Winning gains a foothold in the Simandou iron orebody

The Guinean-Chinese consortium Société minière de Boké (SMB-Winning) obtained on Wednesday 13 November the reallocation of Blocks 1 and 2 of the largest iron ore deposit on the African continent, Mount Simandou.

Previously controlled by the Israeli mining operator Beny Steinmetz Resources Group (BSGR) – which settled years of disputes with the Guinean government in February -, Blocks 1 and 2 of the Simandou iron ore deposit cover an area of 369 km² in south-eastern Guinea (Kerouan prefecture) and were the subject of a call for tenders for their reallocation in July, finally won by SMB-Winning. « The Simandou Blocks I & II project will be crucial for Guinea’s future. This mega deposit is an opportunity in terms of employment and wealth creation for the whole country, » said Sun Xiushun, the consortium’s CEO.  Until now known for its bauxite mining in the northwest of the country, the Sino-Guinean group won the bid after committing to build the much-anticipated Transguinean railway – a 650-kilometre-long track that will allow iron ore to be transported through Guinean territory, at an estimated cost of more than $20 billion, which, according to the head of SMB-Winning, will provide Guinea with a « real lifeline linking four Guinean regions together, accelerating administrative and economic decentralization and strengthening the country’s rail network ».

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The company has also confirmed that it will build a deepwater port on the Matakong peninsula, 50 km south of Conakry, for the export of ore from the country, particularly to China, the world’s largest consumer. All this within five years of the ratification of the conventions. Indeed, the presence among the shareholders of SMB-Winning, aluminium producer Shandong Weiqiao and port operator Yantaï, two Chinese groups, suggests that the world’s second largest economy has a strong strategic interest in the project. The other two blocks on Mount Simandou are jointly owned by the Rio Tinto mining group and the Chinese aluminium producer Chinalco.

A bauxite mining site, managed by SMB-Winning. © SMB

Many observers note, however, that the news of this reallocation of Mount Simandou Blocks 1 and 2 comes in a political context of uncertainty, as Guinea was recently shaken by street demonstrations after President Alpha Condé suggested that he could amend the constitution to run for a third term next year.