(Adds detail on potential of new partners) By Saliou Samb CONAKRY, July 4 (Reuters) - Guinea's mines minister hasordered all work related to the Simandou iron ore mine projectto be halted after the two companies involved missed an extendeddeadline to agree on a joint venture, a letter seen by Reutersshowed on Monday.
Rio Tinto's Guinea subsidiary Simfer SA andChinese-backed consortium Winning Consortium Simandou (WCS) haveshown a "lack of willingness" to work on a partnership, MinesMinister Moussa Magassouba said in a July 3 letter addressed toboth companies.
In a later statement, the government said it was open todiscussions with new partners in the ambitious project that aimsto extract iron ore from Guinea's remote hinterland to a porthundreds of kilometers away, but which has been dogged by delaysin recent years.
"Despite the significant concessions the Guinean State hasbeen kind enough to make, it is clear the obstruction is beingmaintained by both your companies, to the detriment of theinterests of the project," Magassouba wrote.
Magassouba said the halt would apply across the country,effective from 8:00 a.m. local time (0800 GMT) on Monday.
Rio Tinto declined to comment on the latest stoppage and WCSdid not immediately reply to a request for comment. Guinea's ruling junta has suspended construction of the mineand related infrastructure once before, in March, resulting inRio and WCS signing a framework agreement that month under whichthey would "co-develop" infrastructure for the mine, including a670-km railway and a port. The government gave the companies 14 days on June 19 toagree a joint venture, itself an extension of a previousdeadline. The March framework agreement guaranteed the state 15% ofthe Simandou iron ore as well as a free and non-dilutable 15%stake in the railway and port joint venture, the government hassaid. The mines minister said Rio and WCS were stalling over theterms of the government's stake in the joint venture, blamingthe companies for "inertia" on this issue. Rio Tinto has held rights to Simandou since 1997. ThroughRio Tinto Simfer, it owns a 45.05% stake in the southern half,Blocks 3 and 4, of the deposit, with Aluminium Corp of China(Chinalco) holding 39.95% and Guinea's government the remaining15%. WCS holds Blocks 1 and 2 of Simandou. (Reporting by Saliou Samb and Helen Reid; Editing by EstelleShirbon, Jason Neely, Jan Harvey and Paul Simao)
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