After nearly 20 years of setbacks, 11 law firms are counselling on the fast-track development of the world’s largest untapped iron ore mine in Simandou, Guinea, valued at USD20 billion, with investment from China Baowu and Rio Tinto.
Watson Farley & Williams (WFW), King & Wood Mallesons (KWM), Norton Rose Fulbright, Eversheds Sutherland, Hogan Lovells, Thiam & Associés, Clifford Chance, Linklaters, Allens, ADNA Law Firm, DLA Piper, Jincheng Tongda & Neal (JT&N), and Merits & Tree Law Offices advised the major players on the transaction.
The Simandou project comprises both northern and southern mining areas. The northern region is being developed through a joint venture between the world’s largest steel producer, China Baowu, and the Winning Consortium Simandou (WCS), a partnership of Winning International Group of Singapore and China Shandong Weiqiao Group. The southern area is under the development of Simfer, a joint venture between Rio Tinto, the world’s second largest iron ore group, and Chalco Iron Ore Holdings.
After the green light from authorities both in Guinea and China, China Baowu and Simfer finalised the equity transfer and finance shares of the railway and port infrastructure jointly built by the WCS and the Guinean government. This also marks China Baowu’s inaugural capital contribution to the Simandou project, solidifying its position as a shareholder.
Infrastructure costs are shared equally between Simfer and WCS. Under the agreement, Simfer will build a 70-kilometre spur rail line and a 60 million tonne per year transshipment vessel (TSV) port, while WCS will construct the dual track 536-kilometre main rail line, the 16-kilometre WCS spur rail line and a 60 million tonne per year barge port.
On completion, all jointly developed infrastructure and rolling stock will be transferred to the Compagnie du Transguinéen (CTG) joint venture, in which Simfer and WCS will each own a 42.5% equity stake and the Guinean government a 15% equity stake.
WFW’s Dubai-based partner Alhassane Barry led a team advising the Guinean government, with support from partners Jan Mellmann, Arnaud Troizier, Sarah Ellington, Nick Walker, Chris Kilburn, Richard Stephens, Franck Poindessault, Romain Girtanner, Daniel Pilarski and Mhairi Garcia.
KWM, led by partners Zhang Yongliang and George Zhao, acted for WCS, with assistance from banking and finance partner Zhou Jie, Singapore-based partner David Phua and Australia and other overseas offices.
Norton Rose leading partner Christophe Asselineau also advised WCS.
Eversheds Sutherland’s partner Roger Zhou advised China Hongqiao Group, the parent company of China Shandong Weiqiao Group, with support from partners Dickson Ng, Charles Butcher, Alex Carver, Caroline Clapham, Olivier Le Bars and Sindhura Swaminathan.
Baba Hady Thiam, managing partner at Thiam & Associés in Guinea, and Xu Liang, partner at Hogan Lovells in Beijing, led the respective teams advising China Baowu.
Clifford Chance, Linklaters, Allens and ADNA advised Rio Tinto.
DLA Piper counselled Chalco Iron Ore, led by China energy head Carolyn Dong, Asia energy head Russell Wilkinson and partner Karim Maalioun. Other team members included partners Neil Macdonald, Alex Jones, Daniel Colgan, Cheng Ting Lun, Fang Xin, Jeremy Andrews, head of China tax Tina Xia and China head of international arbitration Chen Xiaoshan.
JT&N senior partner Annie Wu and partner Li Yingnan advised the Aluminum Corporation of China, the parent company of Chalco Iron Ore, on the international law.
Merits & Tree, led by partner Cai Qinghong, advised the Aluminum Corporation of China on the infrustrcture joint venture issues. Partners Jenny Li, Song Yaqin, Jin Zheyuan, Jean Zhu, Jerold Zheng, Ye Han, and Hong Lushen.
Located in southeastern Guinea, the Simandou project is one of the largest and highest quality undeveloped iron ore deposits in the world. Since Rio Tinto acquired mining rights in 2006, the project has experienced significant challenges, including political instability, multiple changes in ownership and allegations of bribery involving Guinean officials.
