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Rio Tinto Mulls Using Trucks to Transport Initial Supply Batch of Simandou Iron Ore

Anglo-Australian miner Rio Tinto Ltd., in a bid to honor delivery contracts and supplier commitments, is mulling to start road transporting by using trucks the initial supply batch of iron ore from its Simandou project in Guinea.

Tom Albanese, Rio Tinto Ltd.'s chief executive, on Thursday told a news conference in the capital of the West African nation that the company has forwarded the proposal to the Guinea federal government in anticipation of a 2015 supply target. This, as Rio Tinto Ltd. waits for the final outcome and eventual construction of a planned railway that will link the mine in the north to the west coast of the gulf of Guinea nation.

"We do have a conceptual study underway for an early trucking option in parallel with the construction of the rail line," he said in Reuters. "More than $1.1 billion has been committed for urgent studies on the 650 km railway. The conclusion of the feasibility studies will determine the actual cost of the railway."

Albanese said the company proposed the option in order to meet its terms of agreements. He did not confirm if the government of Guinea has accepted the proposal.

"Our priority is currently to develop our activities in the mine to allow us to meet the delivery of the first shipment of ore by mid-2015," Albanese said.

Albanese, however, did not provide numbers on how much Simandou iron ore is target for export before 2015.

Simandou is one of the world's largest unexploited iron ore reserves.

In October, Rio Tinto Ltd. approved a $1.3 billion funding, bringing total amount spent or committed to the project to $3 billion.

The infrastructure investment framework for the project is expected to be finalized in early 2012,

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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