Rio Tinto is in talks with China’s Chinalco (中國鋁業) on a massive mining project in Guinea, reports said yesterday, raising hopes of a rapprochement that could unlock one of the world’s biggest iron ore fields.
The mining giant is in “advanced” discussions with its former Chinese suitor, the Wall Street Journal and Australia’s Fairfax media group both said without giving sources.
Rio did not make any comment when contacted.
PHOTO: AFP
Analysts said Rio wanted to tap state-owned Chinalco’s vast wealth and influence in the West African country to push forward development of the US$12 billion Simandou field, which has been stymied by political upheaval.
“It shows that the bridges between the two have not been burned and they can strike a relationship where they both bring something unique to the table,” said Tim Schroeders of funds manager Pengana Capital. “It’s encouraging in terms of China’s access to Rio Tinto’s technical expertise, and Rio Tinto’s access to Chinalco’s access to capital and ability to do business in difficult places.”
If the governments of China and Guinea approve the deal, it was likely Chinalco would pay for its Simandou interest by financing the next stage of pre-development, Fairfax said.
Chinalco and Rio were also in talks on iron ore exploration in China, bauxite and alumina refining in Australia and Rio’s Oyu Tolgoi copper and gold project in Mongolia, it added.
James Wilson, a research analyst with stockbroker D.J. Carmichael, said the Simandou field could produce up to 200 million tonnes of iron ore a year — the same as Rio Tinto’s entire Pilbara operation in Western Australia.
He said the 2.5-billion-tonne seam, that stretches for 110km, was “very high grade” at about 66 percent iron, better than any of the Australian ore Rio has been selling to China in vast quantities.
“It’s pretty good gear and it will underpin Rio Tinto’s expansion down the track,” Wilson said. “The only trouble is it will cost them US$12 billion to develop.”
Anglo-Australian Rio, the world’s third-biggest miner, has been working on Simandou for about 12 years, but has hit trouble with Guinea’s military rulers, who handed part of its landholding to an Israeli billionaire.
China signed a US$7 billion and oil deal with Guinea last October in a controversial move just weeks after troops opened fire on protesters, killing 150 people, rights groups claimed.
“It’s a world-class monster. It’s a gorilla of a project,” Wilson said, adding that working in the volatile nation also carried considerable risks. “With great risk comes great reward. Maybe this is a way of diluting the risk a little bit, as well as throwing some cash into the kitty.”
PRECISION STRIKES: The most significant reason to deploy HIMARS to outlying islands is to establish a ‘dead zone’ that the PLA would not dare enter, a source said A High Mobility Artillery Rocket System (HIMARS) would be deployed to Penghu County and Dongyin Island (東引) in Lienchiang County (Matsu) to force the Chinese military to retreat at least 100km from the coastline, a military source said yesterday. Taiwan has been procuring HIMARS and Army Tactical Missile Systems (ATACMS) from the US in batches. Once all batches have been delivered, Taiwan would possess 111 HIMARS units and 504 ATACMS, which have a range of 300km. Considering that “offense is the best defense,” the military plans to forward-deploy the systems to outlying islands such as Penghu and Dongyin so that
WHAT WAS ALL THAT FOR? Jaw Shaw-kong said that Cheng Li-wen had pushed for more drastic cuts and attacked him, just for the outcome to be nearly identical to his bill The legislature yesterday passed a supplementary budget bill to fund the purchase of separate packages of US military equipment, with the combined amount of spending capped at NT$780 billion (US$24.8 billion). The Chinese Nationalist Party (KMT) and Taiwan People’s Party (TPP) used their legislative majority to pass the bill, which runs until 2033 and has two main funding provisions. One was for NT$300 billion of arms sales already approved by the US for Taiwan on Dec. 17 last year, the other was for NT$480 billion for another arms package expected to be announced by Washington. The bill, which fell short of the NT$1.25
‘CLEAR MESSAGE’: The bill would set up an interagency ‘tiger team’ to review sanctions tools and other economic options to help deter any Chinese aggression toward Taiwan US Representative Young Kim has introduced a bill to deter Chinese aggression against Taiwan, calling for an interagency “tiger team” to preplan coordinated sanctions and economic measures in response to possible Chinese military or political action against Taiwan. “[Chinese President] Xi Jinping [習近平] has directed the People’s Liberation Army to be ready to invade Taiwan by 2027. China has a plan. America should have one too,” Kim said in a news release on Thursday last week. She introduced the “Deter PRC [People’s Republic of China] aggression against Taiwan act” to “ensure the US has a coordinated sanctions strategy ready should
A former television news host and six military personnel — active and retired — have been indicted on espionage charges, Kaohsiung prosecutors said yesterday. Lin Chen-you (林宸佑), a former CTi News host and YouTuber, last year allegedly made videos at the direction of a Chinese agent criticizing the Democratic Progressive Party’s recall campaign, the Ciaotou District Prosecutors’ Office told a news conference in Kaohsiung. He allegedly received 4,325 tether coins for the videos from an unidentified person surnamed Huang (黃), believed to be an agent of a hostile foreign power, they said. Lin, also known as Ma Te (馬德), has a show named
RSS