Chinese consortium puts workers on forced leave after Guinea halts Simandou

China Hongqiao

18/07/2022 12:28

JOHANNESBURG, July 18 (Reuters) - Chinese-led Winning
Consortium Simandou (WCS) has put workers on forced leave with
the prospect of layoffs if a dispute with Guinea's government
over infrastructure for a massive iron project is not resolved,
three sources told Reuters.
    WCS did not immediately reply to a request for comment. 
    Guinea's mines minister on July 3 ordered all work on the
Simandou project - the world's largest undeveloped iron ore
deposit - to stop after WCS and Rio Tinto missed an extended
deadline to agree a joint venture with the government. That
joint venture is intended to cover the rail and port
infrastructure the companies will use to export the iron ore.
 urn:newsml:reuters.com:*:nL1N2YL0HY
    WCS forced workers to take one month's leave, and if the
project has not restarted after that, they will be laid off, one
employee said, adding that the order to stop work came through
at the last minute.
    "We were on the way into work when we were told to turn
back," he said. 
    Discussions between WCS, Rio Tinto, and Guinea's ruling
junta have hit a brick wall as the two companies are pushing
back against the government's demand for a 15% free-carried
undilutable stake in the railway and port JV. 
    It was not immediately clear whether the companies
contracted by WCS to build the infrastructure also put their
workers on forced leave.
    Construction conglomerate China Railway International Group,
several of whose subsidiaries are working on the Simandou
railway, did not immediately respond to a request for comment
sent through its website.
    WCS shareholders include Singaporean shipping company
Winning Group, Chinese aluminium giant China Hongqiao, and
Guinean logistics firm UMS, according to the consortium's
website.

 (Reporting by Helen Reid and Joe Bavier in Johannesburg,
Editing by Chizu Nomiyama)
 ((Helen.Reid@thomsonreuters.com; +27 66 156 5214;))