Guinean Mines Minister Dismisses Opposition Leader Threat on Vale Deposit

Guinea’s Mines Minister, Mahmoud Thiam, dismissed an opposition leader’s threat that Vale SA’s $2.5 billion purchase of iron-ore deposits in the country would not be valid.

Vale, the world’s largest iron-ore producer, is buying the assets from BSG Resources (Guinea) Ltd., it said on April 30. The deal includes the Simandou North Blocks 1 and 2, previously owned by Rio Tinto Group.

“There is no opposition -- the Vale-BSGR deal is between two private companies; BSGR has a legal title and decided on a joint venture with Vale,” Thiam said in an e-mailed statement from the capital, Conakry, today.

Union of Democratic Forces Leader Mamadou Bah Baadikko said the country’s opposition wouldn’t recognize the deal for the Simandou iron deposits, Reuters reported on May 4, citing him.

Aluminum Corp. of China last month agreed to pay $1.35 billion for a stake in Rio’s neighboring Simandou project. Chinalco, as the state-owned company is known, will acquire 45 percent of the project by funding development over the next two to three years.

Government support “also goes for the contemplated Rio- Chinalco deal and any future joint venture of a similar nature,” Thiam said.

To contact the reporter on this story: Alpha Camara in Conakry via Johannesburg at pmrichardson@bloomberg.net.

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