Silvia Antonioli and Alexandra Reza London
GLENCORE has expressed interest in iron deposits in Guinea, a presentation obtained by Reuters shows, although the company said it had not pitched for a stake in Simandou.
Glencore is the latest mining major looking to invest in iron ore assets in Guinea. Most interest is focused on Simandou, one of the biggest deposits. Any potential investors in Simandou are treading carefully, however.
Israeli-owned BSG Resources, which was stripped of its licence to develop part of Simandou following a Guinean corruption investigation, is seeking arbitration and has threatened to sue companies that invest in its former licence area.
Three sources close to the government said London-listed Glencore had indicated its interest in investing in Simandou, in a meeting with government officials in Conakry in June.
A copy of a power point presentation, which the sources said a Glencore representative delivered at the meeting, includes a reference to Glencore having the financial and technical ability to develop big projects in the region and “the willingness to proceed very quickly together with the government to the exploitation phase of iron ore projects”.
A spokesman for Glencore declined to say whether any presentation was made to officials or to comment on the document obtained by Reuters. But he said the company had not made any presentation expressing interest in the Simandou mine.
The presentation does say that Glencore would be well placed to co-operate with other companies that hold interests in Simandou, such as Vale and Rio Tinto and says that Glencore could push the majors to develop infrastructure in Guinea more quickly.
Glencore, whose exposure to iron ore is much smaller than that of rivals Vale, Rio Tinto and BHP Billiton, has in the past been critical of rivals for pursuing costly greenfield projects. It has also criticised them for producing large additional volumes of iron ore, which have driven down prices by almost a third this year.
In the presentation, the Swiss-based company said it was keen to become one of the top five producers of iron ore through projects in Africa. “Iron ore is an absolute priority for Glencore,” it said in the presentation. – Reuters