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Home News Guinea would welcome Vale bid for massive iron mine: president

Guinea would welcome Vale bid for massive iron mine: president

Published on 30/04/2014

Guinea's leader said Wednesday that he would welcome a fresh bid by Brazilian giant Vale to mine the world's biggest untapped iron-ore deposit, after stripping it of the concession amid a corruption probe into an Israeli magnate's firm.

BSG Resources (BSGR), the mining arm of Israeli diamond king Beny Steinmetz, had sold to Vale the mining rights it won in 2008 to the area beneath the Simandou mountains.

But BSGR has since come under investigation over the deal signed on the deathbed of Guinean military dictator Lansana Conte that raised eyebrows across the world, with critics saying it vastly undervalued the deposit.

BSGR has vigorously rejected claims of wrongdoing.

Guinean President Alpha Conde said the probe had cleared Vale of any involvement in or knowledge of BSGR’s allegedly corrupt obtaining of the permit and hoped that the Brazilian giant would place a bid for the mining rights.

“We hope that Vale will take part in the tendering process,” he told reporters during a visit to the global commodities trading hub of Geneva.

Conde was elected president in 2010 — the same year Vale bought the mining rights from BSGR — and went on to mandate a sweeping probe of such permits by a government committee, the findings of which were released on April 10.

“After a long investigation in the US, Switzerland and so on, the committee proposed to withdraw the permits, and that’s what we’ve done,” Conde said.

“But we’ve always said that all the investigations showed that Vale was not only not involved in corruption but also was unaware of how the rights were obtained (by BSGR),” he added.

“We’re going to launch a transparent, open bidding process for anyone who wants to take part. We hope strongly that Vale will take part. We don’t have any preferences, but nor are we against anyone,” he insisted.

Vale is understood to have paid $500 million up front as part of its $2.5 billion agreement with BSGR.

The Swiss daily newspaper Le Temps on Wednesday reported that Vale had launched a $1.1-billion suit against Guernsey-registered BSGR at the London Court of International Arbitration.