Anglo-Australian miner Rio Tinto and China's state-owned aluminum giant Chinalco today signed their first ever joint venture, to develop Rio's 12-billion Simandou iron ore-project in Guinea, the world's third-largest mining area, after Australia's Pilbara and Brazil's Carajas.
The joint venture agreement was signed today between Rio Tinto and Chinalco's liste- subsidiary Chalco.
The strategic importance of this deal for China is reflected in the choice of the venue where the pact was sealed - none other than Beijing's seat of government, the Great Hall of the People, and attended by China's commerce minister Chen Deming, and other senior government functionaries, Chinalco chairman Xiong Weiping, Rio Tinto's chairman Jan du Plessis and chief executive Tom Albanese and government officials from China, Guinea, the UK and Australia.
In March 2010 Chinalco and Rio Tinto had signed a non-binding memorandum of understanding (MoU) to establish a joint venture to develop and operate the Simandou iron ore project covering rail, port infrastructure and the mine. (See: The story behind Rio's $1.35-billion Saimandou deal with Chinalco)
Today's agreement followed Chinalco receiving government approval to include iron ore and other non-ferrous metals to its core businesses, which is producing aluminum, copper and titanium. (See: Aluminum giant Chinalco gets state nod to enter iron ore business)
The Simandou iron ore project is estimated to hold 2.25 billion tonnes of ore, and if developed, has the potential to become the world's third-largest mining area, after Australia's Pilbara and Brazil's Carajas.