UPDATE 1-Guinea to sign investment agreement for Simandou iron ore project

Wed May 21, 2014 8:55am EDT

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KIGALI May 21 (Reuters) - Guinea will sign an investment framework agreement for its multi-billion dollar Simandou iron ore project with partners Rio Tinto, International Finance Corporation and China's Chinalco on May 26, the country's mines minister said on Wednesday.

Yansane Kerfalla said the West African country was on track to conclude negotiations on the framework agreement - which basically looks at how to raise money for the project - with its partners on the giant Simandou project.

"Actually we are signing on May 26 the investment framework with Rio Tinto, IFC and Chinalco from China," Kerfalla told Reuters on the sidelines of the African Development Bank's annual meeting in the Rwandan capital.

The investment framework agreement will enable funding for costly infrastructure on the southern half of the Simandou mine that is estimated to cost up to $20 billion or more.

The project includes the constructing almost 700 km (430 miles) of rail, 35 bridges and a four-berth wharf 11 km offshore.

Kerfalla said Guinea was also preparing the tender process for the northern half of Simandou after the government cancelled a previous mining concession held by BSG Resources and its joint venture partner Vale. (Reporting by Duncan Miriri; Writing by Bate Felix. Editing by Jane Merriman)