By Jeb Blount
BELO HORIZONTE, Brazil Feb 22 The head of Brazilian investment group B&A Mineracao confirmed the company is interested in Guinean iron ore assets but dismissed market speculation its interest extended to a slice of Guinea's biggest Simandou deposit.
One of the founders of the group, Roger Agnelli, is a former boss of Brazilian miner Vale and led Vale's push into Guinea in 2010 when it took a stake in iron ore assets that included the northern half of Simandou.
Agnelli, ousted from Vale's top job in 2011, has returned to Guinea at the helm of his new firm, which is nearing completion in talks with BHP Billiton over its stake in the Mount Nimba iron ore project near the Liberian border, sources familiar with the matter have said.
The move for Mount Nimba, a high-grade iron ore project that is much smaller than Simandou, has sparked speculation over Agnelli's ultimate ambitions in Guinea at a time when mining rights are being reviewed.
Eduardo Ledsham, a former Vale executive who is now chief executive of B&A Mineracao, on Friday ruled out an interest in one of the world's top untapped iron ore deposits.
"We have no interest whatsoever in Simandou, which already has two strong partners (for the northern portion) in Vale and BSGR," he said at a press and industry event at the company's headquarters.
BSGR is the mining arm of a business owned by Israeli billionaire Beny Steinmetz.
Ledsham did confirm an interest, however, in the Mount Nimba project.
"We are in negotiations with BHP and (fellow stakeholder) Newmont, but I cannot give you any details because of a strict confidentiality agreement," he said.
Agnelli, chairman of the firm who also spoke at the event, underlined Guinea's attractiveness.
"If you want high quality iron ore like Vale has in Carajas (in northern Brazil), the only place to get it is Guinea," he said.
B&A, which was set up last year to invest in fertilizer, iron ore, copper and the transportation systems needed to move minerals from mine to market, is looking for projects in Latin America and Africa that will allow the company to capitalize on growing demand for raw materials as developing countries get richer.
Within five years, B&A expects to produce 30 million tonnes of iron ore, 500,000 tonnes of potassium and 1 million tonnes of phosphate annually.
Vale itself, however, has put the Simandou project on ice, citing uncertainties as Guinea reviews mining rights granted by a previous government.
B&A Mineracao was founded by Agnelli's holding company, AGN Participacoes, with investment bank BTG Pactual, which is controlled by billionaire financier Andre Esteves.
Agnelli's years at Vale have focused interest on B&A's ambitions in iron ore, but he said his priority would be to grow in the fertiliser business, betting on rising demand for food from a growing middle class in Brazil, India and China.
B&A said venture Fosfatar would begin production from September at a project in the northern Brazilian state of Para, which will produce 150,000 tonnes of phosphate per year.