Investment in Gunia


Mining Sector: Building Strong Partnerships for success


Guinea open for Business

  • Guinea's new approach to mining focuses on increasing the capacity of Government to address the business challenges
  • Guinea, a young democracy with exceptional investment potential
    • In the last 3 years, under the leadership of President Alpha Conde, Guinea has seen its economy stabilized and the country open up to the world. Despite a difficult context, Guinea has made major changes essential to its stabilization and normalization.
    • The country is now embarking on the next phase of its transformation: the move towards economic growth, based on inward investment.
    • The new approach of the Government in the development of the mining sector is based on the following core values:
      • Listening of the partners
      • Finding solutions to the preoccupations and concerns of partners
      • Moving forward for the accomplishment of our common goal
      • Promoting transparency
      • Promoting good governance and
      • Fighting corruption

Why invest in Guinea? Why now?

  • Guinea - On the brink of a new era of economic growth: a clear economic strategy to diversify beyond its mines, a stabilized and well-managed economy, ingredients for double-digit growth, a strengthened business environment and exceptional potential in terms of mineral, agricultural and energy resources, as well as infrastructure and access to sub regional markets.
  • Guinea – Next major destination for investment in Africa. The country is set to become in the next years one of the global players in the mining economy, a major agricultural producer and a sub-regional hydropower exporter.

A growing Economy

  • Guinea's economic growth is projected to remain strong during the period 2012-14, with an average GDP growth of 5%. We are rated Tier 1 fof Global Growth (Source: JP Morgan)
    • Growth driven by important investments efforts in the mining sector and the positive impact of ongoing structural reforms.
  • Since 2010, Guinea has made significant reforms in the key areas of the economy, finance, justice, administration and security. These strategic choices are already bearing fruit:
    • GDP grew by 3.9% between 2011 and 2012
    • Tax revenue increased from 14.9% of GDP in 2009 to 19.2% in 2012
    • Inflation has dropped significantly from 21% in 2010 to 12% in 2012
    • The exchange rate for the Guinean Franc has stabilized

Key Data

Population : 10.8 million
GDP composition by sector : agriculture 12.9%, industry 47.8%, services 39.3%
Exports commodities: bauxite, alumina, gold, diamonds, coffee, fish, agricultural products
Gross debt/ GDP (2012F): 13%
Reserves: USD 806.8 million
Exchange rates: Guinean franc (GNF) per US dollar 6,990 (January 2013)

World-class Deposits. Global Partnerships

  • Mining for success
    • The mining sector is a significant contributor to economic growth
    • The mining sector accounts for 20% of Guinea’s GDP, represents 30% of export revenus and provides 80% of its foreign currency inflow
  • Guinea holds 2/3 of the world’s bauxite deposits
    • Guinea is the bauxite producer worldwide
    • Reserves are estimated at 20 billion metric tons and resources at 40 billion metric tons.
    • Highest quality bauxite deposits with grades of 40%-62% alumina
  • We also hold some of the largest and highest quality iron ore deposits on the planet
    • Multibillion ton reserves and resources, in the same proportions as for the bauxite
    • High grade hematite deposits only require simple mining methods, meaning very competitive mining costs
  • Guinea also has gold, diamond, copper and nickel deposits

Strengthening the Sector for Mutual Benefit

  • Mining code
    • Following discussions with mining business leaders, the Mining Code was amended in September 2011. The amended Mining Code takes into account issues associated with tax and profitability
    • The amended Mining Code has been ratified by the Parliament in April 2013
  • Contract Review
    • With the support of experts and major financial institutions, Guinea has established an open process to consolidate the Guinean mining sector and its investment partners. The objective is to secure stable long-term contracts with investors, protected by law and delivering mutual benefit for business and the country.
    • A win-win partnership: for companies, that means protecting their investments and providing a stable business environment
    • Any adjustments to contracts are negotiated in a spirit of partnership and dialogue.
  • Audit of the Cadaster : New Opportunities
    • Developing an accurate and transparent record of mining licenses to maximize potential from all of Guinea's mineral resources
    • Following an audit of the mining cadaster 818 licenses out of 1500 were found to be inactive, freezing indirectly the valorization of mineral resources
    • Those licenses present new opportunities for businesses, and the Guinea is actively seeking to reallocate these to reliable and professional partners, who have the technical and financial capacity to develop the assets


Iron Ore Deposits in Guinea are cost competitive

  • Iron ore mining projects in Guinea are expected to be in the lowest cost quartile of the FOB cash cost curve in 2020, well below the expected marginal cost of production, which to a large extent determines the level of market prices.
  • The future marginal cost of production is function of the speed at which new projects are expected to come into production and how the demand is projected to evolve.
  • Although the FOB cash cost curve assumes most announced projects will be delivered on time, history has shown that only a portion of these announcements will ultimately materialize
  • The FOB cash cost curve in 2020 is therefore likely to be steeper that the one presented below by requiring high cost Chinese producers to bridge the supply gap, as is the case today, thereby pushing prices up
  • Freight costs differential also have to be taken into account in assessing the competitiveness of a project. Because of its proximity to European markets, Guinean iron ore will enjoy low freight cost vs. competing products into Europe
  • Sharing infrastructure among different mining operations would allow for substantial additional cost reductions.

Focus on the Simadou Project

  • Simadou is one of the largest and most important iron ore project in the world by its size and the quality of its ore
  • Simadou is divided in two parts:
    1. North: Block 1 and 2
    2.South : Block 3 and 4
  • The Simadou South project comprises a major mine with reserves estimated at over 2.6 billion tons, a railway of approximately 650 km and a deepwater port

Simadou will be the largest iron ore mine ever developed in Africa characterized by very high iron ore grade and low level impurities


  • The open pit mines are located at Pic de Fon and Oueleba
  • Approximately 6-8 km long, 1-1.5km wide and 300m deep


  • Indicated and inferred resources of more than 2,6 billion tons of high grade iron ore
  • High-quality friable hematite mineralization (Fe grade of 65.5%) with low to moderate impurities


  • A port to be located in the Morebaya River including a 3 berth export wharf to handle Cape sized vessels. The port will provide multi-used capability
  • A 650km trans-Guinean railway comprising 3 tunnels and 13 sidings


  • First ore esport by rail is targeted for mid 2015 followed by a ramp-up to 100Mtpa
  • Conventional drill, blast, load and haul mining methods will be used
  • Crushing and processing of ore is expected to be done at the mine site to extract sinter fines

Simadou related transport infrastructure will transform the Guinean economy and should foster the development of other regional mining projects.


  • Deepwater port complex planned 60km south of Conakry in Forecariah prefecture
  • Pioneering marine offloading facility and ore export terminal
  • The port will be composed of 18km over-land conveying, 3-4km causeway, 7-8km jetty (would be the longest jetty in the world)
  • The port is to be self powered from a 100MW diesel fired facility to be built at site.


  • 650km rail corridor will require 28km of tunnels, and 37 bridges amongst tropical forest
  • It will provide access to port at Morebaya from the mining concession (550m above sea level)
  • Daily traffic of nine loaded ore trains of 240 wagons
  • The rail line is envisaged to be multi-user, multi-product infrastructure (other minerals freight or passengers) subject to commercial agreement
  • The railway will also connect with the existing Conakry-Kankan railway, one rehabilitated.

Discussions are underway between shareholders to finalize the project.

Update on Recent Developments in the Mining Sector: Forecariah
Forecariah is developed by a joint venture between Bellzone and China International Fund


  • The deposit is located southeast of Conakry


  • Three ore types have been classified which produce a saleable product:
  • Indicated and inferred JORC resources of 3.2 million tons ar an averge grade of 55.8% Fe (DSO)
  • A surface oxide of 71.1 million tons, with an average grade of 34.7% Fe
  • A weathered and fresh haematite schist of 161.5 million tons, grading at 24.3% Fe


  • The mine is scheduled to produce 2 million tones in its first year of operation, and increase to 4 million tones a year later
  • The DSO resource will produce a 58% Fe product through the currently operating crushing and wet screening plant
  • The oxide will be upgraded to a 58% fines products by a combination of gravity and magnetic recovery process
  • The haematite schist will be upgraded by grinding, magnetic separation and reserve flotation
  • The  company has shipped the first 63 000 tons of iron ore on December 2012

Forecariah started production and first shipment of iron ore took place on 27th December 2012 after two years of development.

Development of Infrastructure associated to the Mines

Geographic alignment present great opportunities for infrastructure sharing within Guinea

  • The development of the bulk mining projects require intensive capital investments in infrastructure
  • The existence of multiple high quality mineral deposits in Guinea, creates opportunities for synergies, risk and cost reduction as well as enhanced and sustainable development.
  • Common infrastructure that can be share include:
  • Ore, passenger and freight transportation
  • Ports
  • Electricity facilities
  • Telecommunications facilities

Infrastructure sharing has been identified as a major opportunity to achieve low capital and operating costs for ore transit and to provide broad development benefits in Guinea.


Deposits location:

  • The main gold bearing region is the Upper-Guinea and particularly the Siguiri basin (Prefectures of Siguiri, Koroussa, Dinguiraye, Kankan, Mandiana and Kerouane)
  • Gold is also found in Fataba area (Mamou-Faranah), Sierra-Fore (East of Kindia) and N’Zerekore.
  • Guinea currently produces c. 16 tons of gold per year
  • Guinea’s three main gold procedures:
  • Anglogold Ashanti (Siguiri mine)
  • Semafo (Kiniero mine)
  • Severstal (Lefa mine)


Government strategy to develop the Bauxite Industry

Our strategy focuses on 3 main objectives

  • Expansion of the bauxite production capacity (from 7% of the world’s production today to 25-30% in 2018)
  • Bauxite projections: from 17 million tons per year to 72-84 million tons per year
  • Alumina projections : from 700 000 tons per year to 17 million tons per year

Allocation of new license and concession

  • 2012: 2 concessions were granted in the iron ore industry and 1 concession in the bauxite industry
  • 2013: the objective is to grant several mining exploration licenses on known deposits and 3-4 mining concession

Infrastructure development

  • Kamsar Harbour (evacuation of the bauxite and alumina): operational infrastructure (CBG) and further expansion of new infrastructures are being finalized by Guinea Alumina Corporation (project developed with BHP, Mubadala, Dubal)
  • Bofa Hrbour: projects of development are underway (projects developed with Alufer and China power Investment)
  • Forecariah Harbour: iron ore transport of GDC (Guinea Development Corporation)

Guinea is moving from a country known for its extraordinary potential in bauxite and alumina to a major international producer.

Bauxite Potential of Guinea
There are 5 various types of bauxite in Guinea

  • Lateritic bauxite _ schistous origin
  • Lateritic bauxite – dolerite type
  • Residual bauxite – syenitic origin
  • Alluvial sedimentary bauxite
  • Eluvial sedimentary bauxite

High Quality Ore

  • North-West of Guinea: prefectures of Boke and Gaoual
  • Average grade of 53% A1203 and 2% SiO2
  • South-West of Guinea: prefectures of Fria, Telemele and Kindia
  • Average grade of 44% A1203 and 2.9% SiO2
  • Central Guinea: prefectures of Pita and Dabola(South)
  • Average grade of 47.5% A1203 and 2% SiO2
  • North-East of Guinea: prefectures of Tougue and Dabola (North)
  • Average grade of 40% A1203 and 2.8% Si02

Key Companies Operating in the Bauxite Industry


  • The main player in the bauxite industry
  • A joint venture between the Government of Guinea and an international consortium
  • Production of 14 million tons in 2012 (20 million expected in 2015)


  • A joint venture between the Government of Guinea and RUSAL
  • Production of 3 million tons annually


  • Bauxite mining company based in Fria
  • Production of o.7 million tons annually

Key Projects in the Bauxite Industry


KABATA 1.5-4.5 1.5 $1BN
DIAN-DIAN 3.0-9.0 1.2-2.4 $4BN
HENAN CHINA 20.0 3.0 $3BN
TOTAL 43.5-61.5 16.9-20.5 $24BN

Update on Recent Developments in the Bauxite Sector: CBG and Mubadala
Compagnie des Bauxites de Guinée has signed a long-term bauxite supply agreement with Mubadala


  • CBG is 49% owned by Guinea and 51% BY Halco Mining, a composed of Alcoa,Rio Tintc Alcoa and Dadco

  • UAE’s Mubadala owns 50% of Emal, targeted to become the world’s largest free-standing aluminum smelter, producing 1.3 Mtpa by 2014


  • The UAE demand for bauxite will substantially increase with EMAL ongoing expansions

  • The agreement secures strategic resource for the UAE’s aluminum industry


  • Enabling the expansion of CBG to more than 20 million tons of bauxite per year from 13.5 million to today

  • Guinea will benefit from a major investment program to increase the capacity of CBG

  • The new supply agreement will bring close to USD 500m of additional GDP to Guinea and provide a significant increase in fiscal revenues

  • A good deal for both Guinea and the UAE that reflects Guinea’s objective to enter into  mutually benefiting partnerships with internationally recognized players

  • Update on Recent Development in the Bauxite Sector: Dian-Dian
    Guinea and Rusal have reached an agreement for the development of the Dian-Dian bauxite deposit
  • Rusal is the world’s largest aluminium producer

  • Dian-Dian is one of the world’s largest bauxite deposit

  • The deposit is located 370km Nord-East of Conakry

  • The project will include a mine, an alumina refinery, a marine port, a railroad from the mine to the port, a power plant and other infrastructure


  • The project will be developed in stages:

  • First stage to be completed by the end of 2015 with mine development to reach an annual capacity of 3Mtpa

  • Production to reach 6Mtpa by 2019 and completion of a 1.2Mtpa alumina refinery

  • Expansion of bauxite production capacity to 9Mtpa

  • The agreement also provides for a possible expansion of the alumina refinery to 2.4Mtpa and of the bauxite mine to 12Mtpa

  • The agreement reinforce the relationship between Guinea and Rusal and confirms the growing confidence of the international community in the country

Guinea Mining and Development Promise

  • The Government of Guinea is committed to the strengthening of its economy and the development of an international mining sector as well as to contractual transparency

  • Guinea achieved the completion pint under the HIPC enhanced initiative and demonstrated much improved macroeconomic indicators

  • The Government’s primary goal is to ensure fair and sustainable benefit from mining activities for the people of Guinea while improving the country’s attractiveness for investors

  • The Government is committed to ensure full transparency and appropriate due diligence in managing the country’s mining wealth as reflected by the online publication of mining titles, contracts and conventions

  • The mining sector in Guinea contributes to around 20% of the country’s GDP, with bauxite production by far the most important contributor to date, but the potential is much greater

  • To ensure additional value creation, the Government is encouraging local transformation

  • Recent developments have demonstrated the ability of Guinea to enter into mutually beneficial arrangements that meet the objectives of all parties involved

  • Infrastructure sharing has been identified has a major opportunity for all parties to achieve low capital and operating costs for ore transit and to provide broad development benefits in Guinea

  • The alignment of multiple high quality mineral deposits creates tremendous opportunities for synergies, risk and cost reduction as well as enhanced and sustainable development

  • Join Guinea in developing its vast resources
  • Contact Details:
    Bouna SYLLA
    Economy and Finance Advisor to Minister of Mines