Guinea’s long-delayed $23 billion Simandou iron ore project is finally moving forward, setting the country on course to become Africa’s second-largest mineral exporter after South Africa.
The massive venture, described as Africa’s largest mining project, has been years in the making after decades of political instability, legal disputes, and ownership changes, according to Bloomberg.
The Simandou deposit was first explored in the 1950s during French colonial rule, but its full potential was only confirmed in the 1990s when Rio Tinto geologists identified its high-grade iron ore reserves.
Progress stalled for decades due to political upheaval and corporate conflicts, leaving what is considered the world’s largest untapped iron ore deposit largely undeveloped.
Chinese state-owned enterprises now hold about 75% of the project, while Rio Tinto retains a 25% stake, the only Western share in the venture.
Chinese investors are also financing and building the vital infrastructure, including a 600-kilometre railway linking the mine to a new deep-water port on Guinea’s Atlantic coast.
The project aims to produce about 60 million tonnes of high-grade iron ore each year in its first phase, expanding to 95–100 million tonnes annually as operations grow.
These production levels could make Guinea a major global supplier of high-quality iron ore, a key raw material for steelmaking, especially in China.
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The project is expected to transform Guinea’s economy. Mining currently makes up around 2.2% of the nation’s GDP, but Simandou could raise this to 3.4% during its 2030–2039 operation period, generating about $1 billion in annual government revenue once it reaches full production.
Beyond revenues, the venture is projected to create tens of thousands of jobs, boost infrastructure, and diversify Guinea’s mining output beyond bauxite and gold.
“The goal is not to take the money and spend it. It’s to invest a good part of it in developing other sectors of our economy,” said Diakite, head of the government’s Simandou Strategic Committee, in an interview with Bloomberg.
Officials see Simandou as a foundation for long-term growth, similar to how oil transformed Saudi Arabia and the UAE, but with a focus on avoiding the “resource curse.” Rio Tinto and its partners are also required to complete a feasibility study for a domestic steel plant within two years of starting operations.
The IMF estimates that the project could boost Guinea’s GDP by more than 25% by the early 2030s, providing jobs and driving broader development even though much of the population still faces low literacy levels.
However, risks remain. Environmentalists have raised concerns about potential harm to one of Africa’s most biodiverse regions, and analysts warn that without strong governance, much of the revenue could leave the country.
Guinea’s government insists that the proceeds will fund local projects in infrastructure, education, and healthcare to ensure sustainable growth.
With ore now being transported toward the coast, Simandou represents both a major opportunity and a challenge. Analysts say its timing is strategic, offering an alternative supply to Australia and Brazil in the global iron ore market, and could redefine Guinea’s economy while strengthening Africa’s position in global mining for years to come.
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Image Credit: Serrari Group
