November 13, 2019 / 11:54 PM / a month ago

UPDATE 1-Australia's Fortescue loses bid to develop Guinea iron ore blocks

(Adds background on Guinea iron ore blocks)

Nov 14 (Reuters) - Fortescue Metals Group lost out in its bid to develop two blocks at the Simandou iron ore deposit in Guinea, the Australian miner said on Thursday.

A China-backed consortium of French, Singaporean and Guinean interests won the tender through its $14 billion bid, sources told Reuters on Wednesday.

The consortium - The Société Minière de Boké - committed to developing blocks 1 and 2 of the largest known deposit of its kind, holding more than 2 billion tonnes of high-grade ore.

Fortescue said the Guinean government told them it would go ahead with “detailed negotiations” with the preferred bidder in the coming months.

Simandou has been mired in protracted legal disputes, while the high cost of infrastructure to transport the ore out of the remote southeastern corner of Guinea has also put a dampener on potential developers’ enthusiasm.

Simandou blocks 3 and 4 are owned by a joint venture of Rio Tinto, China Aluminium Corp (Chinalco), and the Guinean government. (Reporting by Nikhil Kurian Nainan in Bengaluru, Editing by Chris Reese and Sherry Jacob-Phillips)

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