UPDATE 1-Guinea sets Jan deadline for more answers from Vale, BSG-source

Fri Dec 20, 2013 7:02am EST

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* Joint venture officials attended Monday hearing over mine deal dispute

* Committee to send transcripts in 2 weeks, then give VBG 8 days to respond (Updates with BSG Resources position)

By Saliou Samb

CONAKRY, Dec 20 (Reuters) - A committee reviewing Guinea's mining contracts has set a January deadline for BSG Resources and Brazilian partner Vale to provide more information on their disputed mine deal, according to a source present at a hearing this week.

BSG Resources, the mining arm of Israeli billionaire Beny Steinmetz's business conglomerate, is fighting to maintain its right to develop half of the giant Simandou iron ore concession in Guinea, after the West African country's government accused it of bribing officials to secure the deal in 2008.

BSGR has repeatedly denied the allegations of wrongdoing. It says Conakry is using the contract review to undermine its position in the country and has said the hearing earlier this week - part of the process - was a "charade".

Vale - which became BSGR's partner in the Guinea venture in 2010, two years after the initial deal was struck - has denied involvement in any events leading up to the license being allocated in the first place in 2008, weeks before the death of then-president Lansana Conte.

The government's technical committee had summoned representatives from VBG - the joint venture between BSGR and Vale in Guinea - to answer questions on Monday, but the source said on Thursday that uncertainties remained.

"Without giving you the details of the dossier, we can tell you that there were essential questions that were not answered at all" by VBG, said the source, directly involved in the closed-door talks but who asked not to be identified.

The source said a full written transcript of Monday's hearing would be sent to VBG along with further questions in the next two weeks. The company will then have a maximum of eight days to respond - effectively, a three-week deadline.

"VBG did indeed attend the administrative hearing organised by the (committee). But you must know that you can't ask a CEO questions that are up to shareholders to answer," a VBG official said, asking not to be identified.

A spokesman for BSGR said the company was not in a position to comment until it had received formal notification from the technical committee. Vale confirmed VBG attended the hearing, but said it had no additional information.

The future of BSGR's northern half of Simandou, a deposit seen as key to boosting government revenues for one of Africa's poorest countries, is unlikely to be immediately determined by the technical committee's hearing.

But the outcome of that process is an important prerequisite ahead of a final decision on BSGR's future in Guinea. (Writing by Joe Bavier; Editing by Dale Hudson)

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