CONAKRY, Sept 25 Mining firm BSG Resources'
threat to sue investment bank BTG Pactual over alleged
misdealings with Guinea's government is "insulting, fantastical,
and contradictory", the country's Presidency said on Tuesday.
BSG is developing a portion of Guinea's Simandou iron ore
project with partner Vale, though tensions have risen with the
government over the financing of infrastructure and a revamp of
the West African state's mining code.
A newspaper in Brazil reported on Sunday that BSG was
preparing to sue BTG Pactual, which it accuses of misusing its
role as an adviser to Guinea's government to win licenses for a
holding company at BSG's expense.
BSG is owned by Israeli billionaire Beny Stenmetz. A BSG
official in Conakry said he was not aware of the plans for a
lawsuit, and other BSG officials were not immediately available
"The allegations are at once insulting, fantastical, and
contradictory," Mines Minister Mohamed Lamine Fofana said in an
email forwarded to Reuters by Guinea's Presidency. "The
negotiations underway between the state and potential partners
are happening in a perfectly legal, open and transparent
manner," he said.
He added that Guinea was consulting BTG Pactual and B&A, a
holding company BTG Pactual formed with partner AGN
Participacoes, for financing of a trans-Guinean railway line
that would link Simandou to port.
He said the talks did not pose a threat to the Simandou
blocks operated by the BSG and Vale joint-venture.
Guinea is the world's top supplier of the aluminum ore
bauxite and holds rich deposits of iron ore, but the country is
struggling to maintain foreign investment amid deepening
political turmoil, labour unrest, and a government review of
Brazilian mining giant Vale initially held the contract for
upgrading the trans-Guinean railway line, but the deal was
canceled by President Alpha Conde after he was elected in 2010.
Rio Tinto, which is developing another part of Simandou
along with joint venture partner Chinalco, is also interested in