Guinea. Military junta stirs up nerves in mining sector | Africa | DW

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Since taking power in September 2021, Guinea’s military junta has increasingly attempted to streamline mining activities and deals to benefit what leaders have repeatedly dubbed “Guinea’s interests”.

Led by Colonel Mamady Doumbouya, the junta has spent months at loggerheads with foreign mining companies operating in the West African country, despite earlier assurances of continuity in mining operations.

Guinea is the world’s second largest producer of bauxite, the main source of aluminium. According to the World Bank, Guinea’s mining sector contributes around 35% to the country’s GDP. But the recent upheavals in the sector could threaten the future of the industry.

Halt of operations in Simandou

British-Australian mining giant Rio Tinto and its partners have been ordered to halt all work on the massive Simandou iron ore project after Doumbouya demanded clarification on how the mine will safeguard the national interests of Guinea.

In a statement, the ruling junta said Doumbouya had “requested the implementation of the exploitation of the Simandou deposit taking into account the interests of Guinea. Unfortunately, to date, despite his request, which dates from December 2021, there has been no progress. “

Colonel Mamady Doumbouya repeatedly assured that the military junta was acting in the best interest of Guniea

The interim government says any developer of the mine must also build a railway from Simandou in the southeast of the country to the port of Conakry to ship their product overseas. If they don’t comply, the developers risk losing the project.

Last year, Rio Tino announced plans to build a shorter, cheaper railway to Nimba in Liberia, but the proposal was rejected by Guinea.

Guinea currently holds a 15% stake in Blocks 3 and 4 of Simandou, while Rio Tinto and China’s Aluminam Corp. respectively hold 40% and 15% of the shares.

With iron ore reserves estimated at 2.4 billion tons, Simandou is considered one of the largest mines of its type in the world. However, ongoing legal disputes and the costs associated with the infrastructure have left it largely untapped.

Other ‘frightened’ mining companies

With the future of the Simandou project uncertain, analysts warn of potentially devastating consequences for Guineans.

Economist Mamady Fanta Keita says more than 45,000 people risk losing their jobs if the Simandou project does not resume operations quickly.

“Simandou is already one of the biggest iron ore mining projects in Africa,” he told DW. “Not only does he mine iron, but he [supports] many infrastructure programs in Guinea… So the stoppage of work in Simandou is a real problem for the population.

A worker in a bauxite mine in Guinea

Thousands of Guinean miners risk losing their jobs on the Simandou project alone

While the military junta has argued it simply wants to get the best deals for the country, Keita fears it is taking the wrong approach.

“It could have been done without hampering the work at Simandou,” he said. “I have seen many people who are directly affected by the decision. Even my friends who work on the Simandou project are at home without work.”

He believes relations between the junta and mining companies are rapidly deteriorating, despite early positive signs to the contrary.

“At the beginning, the collaboration was good, because when the junta came to power, it never wanted to disturb the mining companies,” he said. “But now, looking at the behavior of the junta on Simandou, other mining companies are likely to be spooked,” Keita said.

Cars drive past posters of military junta colonel Mamady Doumbouya, on the street in Conakry, Guinea

Guinea’s military junta initially said maintaining stability in the country was its main objective

Looking for solutions

In an attempt to find a way forward, talks are currently underway in Guinea between Rio Tinto officials and the military junta.

“We are in discussion with the Guinean government and support their view that co-investment and the development of rail and port infrastructure is the best way to develop Simandou projects,” Bold Baatar, president of the company, told reporters. Rio Tinto, Copper International Operations. in Conakry last week.

Baatar said the mining company aims to “work with the [Guinea] government and all other partners to create the appropriate structure to move the Simandou project forward for Guinea and all stakeholders”.

This is not the first time that putschists have tried to interfere with existing mining agreements in Guinea.

In 2008, then-military leader Captain Moussa Dadis Camara also pledged to block mining projects and renegotiate contracts after taking power following the death of longtime President Lansana. Tale.

Karim Kamara contributed to this article,

Edited by: Ineke Mules

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