RE: Guinea Approves Simandou Infrastructure Plan15 Nov 2020 11:17
Hi Jiving,
Thanks for this !
These blocks (1 + 2) are described as 'Chinese-backed'. Can anyone throw light on consortium members and %ages ?
I see these names in the consortium frame, but no %ages :
- SMB Soc Miniere Boku (private, link to President's son);
- Winning Shipping (S'pore);
- Shandong WeiQiao (aluminium);
- UMS transport/logistics (Guinea); and
- Yantai Port Group.
Guinea Govt has separately a 10% stake in the project itself.
For comparison, blocks 3 + 4 are said to be under control of SimFer, which AIUI, is
- Guinea Govt 15%
- RioTinto 45.05%
- Chinalco 39.5%.
Incidentally, on the Rio Tinto front, there's a good article behind paywall on https://www.economist.com/business/2020/10/10/why-rio-tinto-and-china-are-at-loggerheads
Snippet : .."China wants to change that. It is in the odd position of having world-leading technology companies but barely a toehold in one of the most basic industries of all, iron-mining, at a time when prices above $100 a tonne are throttling its steel mills. It has long hoped to alter the balance of power by backing the development of a vast iron-ore deposit in Guinea called Simandou, in which Rio Tinto has a joint venture with Chinalco, China’s state-owned aluminium producer (and Rio’s biggest shareholder). For years, Rio has subtly thwarted China’s ambitions by keeping the west African project on the back burner. But since last year a China-backed consortium in Guinea has upped the ante by pledging to push ahead with its own $14bn project to develop Simandou’s two northern blocks. Rio and Chinalco control the southern ones.
That creates a conundrum: should Rio double down on Simandou, sell out, or somehow continue to play a waiting game without offending either its Chinese customers or the Guinean government? ..."
and , after looking at risks of collaboration in Guinea (lack of control of freight costs) and lower risk alternatives at home (Pilbara), it concludes :
..."The best way for it to preserve its interests may be to sit tight on the southern block, advising everyone else how to make progress, but avoiding sinking lots of capital into producing its own ore. Whether the other firms want to proceed will be up to them. For all Rio’s ups and downs at Simandou, the policy of strategic inaction has worked so far. Whoever becomes Rio’s next boss would be unwise to abandon it..."
Strategic inaction, eh ? That sounds familiar...
ATB
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