Assessing the Long-Term Viability of Rio Tinto's Simandou Project Amid Safety and Governance Challenges

The Simandou iron ore project in Guinea, one of the most ambitious resource megaprojects in Africa, has become a focal point for debates over safety, governance, and the long-term viability of high-risk ventures in emerging markets. Rio Tinto, through its joint ventures, holds a significant stake in the project, which is expected to produce over 120 million tons of ore annually once operational. However, a pattern of fatalities, safety failures, and opaque governance practices has raised critical questions about whether the project can deliver its promised economic and strategic value without compromising ethical and operational standards.

A Troubling Safety Record

Between June 2023 and August 2025, at least 13 workers—primarily from subcontractors like Shaanxi Construction Engineering Group Corporation—have died in preventable accidents at the Simandou site. These include forklift overturns, equipment failures, and traffic incidents involving project vehicles. Internal reports reviewed by Reuters reveal that many of these deaths were linked to inadequate risk assessments, poor equipment maintenance, and insufficient medical facilities. For example, the death of 32-year-old Alseny Camara in November 2023 was attributed to a subcontractor's failure to address forklift safety protocols.

The project's safety record is further marred by a lack of transparency. Over 40 accidents—many involving serious injuries—have not been publicly disclosed. A draft assessment by French firm Artelia, commissioned by the Winning Consortium Simandou (WCS), highlighted “poor health and safety conditions” at worker camps, including limited first aid training and inconsistent medical care. Meanwhile, families of deceased or injured workers have reportedly signed memorandums of understanding (MoUs) and waiver statements absolving the companies of liability, a practice that raises ethical and legal red flags.

Governance and Accountability Gaps

The Simandou project is managed through two joint ventures: Rio Tinto Simfer (blocks 3 and 4) and Winning Consortium Simandou (blocks 1 and 2). The latter, which includes Chinese firms like Chinalco and Baowu Steel, is responsible for the railway and port infrastructure. However, the division of responsibilities has created accountability gaps. Investigations into nine incidents conducted jointly by WCS and Rio Tinto Simfer found that minimum safety guidelines were not consistently followed.

The Guinean government, which holds a 15% stake in Simfer and a 10% stake in WCS, has launched an inquiry into the project's safety issues. Yet, the lack of public detail about the findings and the ongoing legal challenges from local communities—seeking to annul environmental compliance certificates—suggest that governance remains fragmented. Communities in Forécariah, Kérouané, and Mamou prefectures have cited environmental degradation, including contaminated water sources and agricultural land loss, as evidence of non-compliance with national and international standards.

Environmental and Social Risks

Beyond safety, the project faces mounting environmental and social scrutiny. A February 2025 study by Ghana's Council for Scientific and Industrial Research found dangerously high acidity levels in water near the mine, linked to mining runoff. This contamination threatens local agriculture and drinking water supplies, exacerbating tensions with communities. Additionally, the proposed railway and port infrastructure cut through habitats of endangered species and critical fisheries, raising concerns about biodiversity loss.

The Guinean government's alignment with international standards—such as the IFC Performance Standards and the Extractive Industries Transparency Initiative (EITI)—has not yet translated into visible improvements. While Rio Tinto and its partners have pledged to enhance safety protocols and environmental management, the absence of independent verification and public reporting undermines these commitments.

Operational and Financial Implications

The recent suspension of operations at the SimFer mine site following the August 22, 2025, fatality underscores the project's operational fragility. Delays in infrastructure development—such as the 600-kilometre railway and deepwater port—could push first ore shipments to 2026–2027, further straining budgets. Investors must weigh these risks against the project's potential to generate $10–$15 billion in annual revenue for Guinea and its partners.

Investment Considerations

For investors, the Simandou project represents a high-reward, high-risk proposition. Key factors to monitor include:
1. Safety and Governance Reforms: Will Rio Tinto and its partners implement transparent, third-party safety audits and address subcontractor accountability?
2. Environmental Compliance: How will the Guinean government and project stakeholders mitigate ecological damage and community grievances?
3. Project Timelines: Can infrastructure delays be managed without derailing the project's economic viability?

The project's success hinges on Rio Tinto's ability to reconcile its corporate commitments with on-the-ground realities. While the company has emphasized adherence to ESG standards, the recent fatalities and governance lapses suggest a gap between policy and practice. Investors should also consider the broader geopolitical risks in Guinea, including political instability and regulatory shifts.

Conclusion

The Simandou project exemplifies the dual-edged nature of resource megaprojects: immense economic potential paired with profound operational and ethical challenges. For Rio Tinto, the path forward requires not only technical and financial execution but also a renewed focus on transparency, accountability, and community engagement. Investors must assess whether the company can transform its commitments into tangible improvements—or risk seeing the project's long-term viability eroded by repeated failures.