Rio Tinto is having another bad week. Well-respected industry consultant, Jack Parker, has reiterated his concern that Rio Tinto’s Eagle nickel project application contains a plethora of incompetent and potentially fraudulent information and one of the company’s iron ore executives and three staff remain in Chinese custody over bribery and espionage charges. If this weren’t enough to cause investors to question the company’s decision making abilities, Rio Tinto has found itself in another fracas. This time, the Government of Guinea has accused the company of threatening the country’s economic autonomy and “civil peace.”
Map courtesy WikiMedia Commons
In December, realizing the true value of its mineral assets, the Guinea government revoked half of Rio Tinto’s concessions for the massive Simandou iron ore project, widely advertized by the company as one of the world’s largest untapped sources of iron ore, and gave rights to a much smaller miner, BSG Resources. According to the London Times, Rio Tinto had failed to respect Guinea’s decision and refused to move its mining equipment from the disputed area.
Simandou Mountain Range, Guinea; Photo courtesy WikiMedia Commons
In a June 26 letter, Mahmoud Thiam, Guinea’s Mines and Energy minister, wrote to Rio Tinto’s CEO, Tom Albanese, and Chairman Jan du Plessis that “If the equipment is not withdrawn within a maximum period of one week, your business will be suspended until the final implementation of the decision.”
This week Rio Tinto agreed to remove the equipment.
Thiam’s letter continued: “Rio Tinto seems to ignore this sovereign decision from our Government with a doggedness verging on defiance of the authority of the State. . . Such activities comes dangerously close to destabilising civil peace and weakening our socio-economic balance. . . We hold – I say it again – palpable proofs of these acts and we are currently examining the different means at our disposal to sanction them.”
Rio Tinto insists that it has intended only to “conduct good-faith discussions” with Guinea.
LSMN
Eve Divine
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