Development impacts of a new mining town in Guinea.

Rio Tinto was to spend $12B opening a new mine and needed to address the impacts socio-economic impacts they would have with doing so in one of the poorest and most corrupt countries in the world.

The world digs-up and transports over 3.5 billion metric tons of iron ore each year to produce steel.  That’s equivalent to nearly 700 of the great pyramid in weight annually.  The world’s single largest reserve of iron ore was found in the Simandou mountains of eastern Guinea in the mid 1990’s.  Simandou is an impassably thick jungle region approximately 700 kilometers inland from the coast in a country with no major rail, roadway or port infrastructure.  Optimistic estimates to set-up a mine in Simandou is approximately $12 billion (USD) and would include the construction of a new heavy-gauge cross-country railway, and a deep-water port, including 15 kilometers of trenching through the continental shelf that precludes the large shipping vessels from reaching its coast.  At that cost, any mining company would need to know that it would have stable and consistent mine operations for approximately 75 years to amortize its costs.  However, since its independence from French rule in 1958, Guinea has been unstable complete with multiple coups, presidential assassination attempts and massive government fraud.  The US publication, Foreign Policy, has called Guinea a failed state and generally, Guinea is considered one of the most corrupt and poorest countries in the world.  Despite these risks, mining company giant, Rio Tinto, pursued and won the exclusive concession to extract the Simandou iron ore by the Guinean government in the early 2000’s and began setting-out to design the massive country-wide infrastructure required to mine and transport the ore.

“Our long-term perspective?  Behind every person with a job, there are 20 dependents.  Perspective is a luxury.” — Conakry official

In 2006, Rio hired design consultancy IDEO to help it tackle several key infrastructure challenges, the most complex of which was the formation of the new mining town at the base of operations in Simandou.  New mines generate new jobs but there are surprisingly few people needed to operate a mine of this scale.   And given the level of poverty in Guinea, word of a massive new mine would inevitably attract thousands of people from all over West Africa.  Contemporary examples of new mining towns are grim: poor who have migrated with the hope of fair wages find unemployment and lack of services able to provide and care for them.  Shanty towns quickly spring-up with health risks and violence. Mining companies fence themselves off to secure their employees and operations which increases tensions and furthers instability as the impoverished blame both their own government and the foreign organizations for not creating more equitable support and access to opportunity.

FIX Founder, Shannon Loew, led the development portion of the project while employed at IDEO.  He and team traveled to Guinea with the goal of designing a more sustainable and equitable strategy for opening-up mining operations.  The intent was to help Rio Tinto adopt inclusive urban development processes that would support a greater number Guineans and ultimately garner greater stability over the long-term.  While in country, the team met with officials and elected leaders of the country, local municipalities and communities.  They assessed local capacity, cross-referencing that with the needs of both mining operations and general urban development to identify synergies and opportunities for using local labor and materials in establishing the mine and its supporting town.

Sadly, just following this initiative, Guinea fell into political turmoil and violence.  In parallel, the mining concession has been contested and been at the center of a massive international case of fraud, embezzlement and bribery, with involvement from the US Justice Dept and multiple countries.

Client Rio Tinto
Size n/a
Location Simandou, Guinea
Program Formation of a new mining town
including operations, worker housing
medical and support services.
Role Ethnographic research
Urban design and planning
Strategic visioning
Policy
Impact Opportunity: Supplanting tradition and creating hundreds of jobs and job training opportunities for local population (versus imported labor) in the opening and operation of mining activity.