​BSGR forced to hand over documents in Simandou scandal

BSG Resources legal team will be forced to provide thousands of documents relating to their disputed acquisition of the Simandou iron ore blocks in Guinea.

The announcement is the latest round in a long running legal dispute over the ownership of the iron ore tenements.

It began when Rio Tinto claimed that BSG Resources stole the mining rights for Simandou blocks 1 and 2 in 2008 and later entered an agreement with Vale who had already obtained propriety knowledge, after Rio spent more than a decade and hundreds of millions of dollars in developing the site.

In its filed complaint, Rio stated that negotiations between it and Vale started in 2008, and Rio provided the information regarding Simandou.

It stated that “as Vale quickly surmised, gaining control of the Simandou deposit would strengthen Vale's position in the world's high-grade iron ore market, since the only other comparable source is Vale's own Carajas Iron Ore Mine in Brazil”.

The miner went on to state that Vale and BSRG “entered into a conspiracy to misappropriate Rio Tinto’s Simandou rights” and used a campaign of bribery to do so.

It stated that Vale and BSGR then paid a $200 million bribe to the Guinean minister of mines, Mahmoud Thiam, for his assistance in “unlawfully securing Rio Tinto’s Simandou rights”.

Following the revelation of this information, the Guinean Government revoked all of BSGR and Vale’s mining licences for both the Simandou and Zogota concessions in the country.

According to Dow Jones, Vale’s general counsel Clovis Torres said the miner may be willing to settle the case out of court, but "never as an acceptance of guilt."

In an unusual turn BSGR then began arbitration with the International Centre for Settlement of Investment Disputes against the Government of Guinea and its president, Alpha Conde for stripping the company of the resource.

BSGR has also threatened to sue Rio Tinto and Vale if the miners continue to claim it carried out corrupt practices to obtain rights to the massive Simandou iron ore blocks.

It is carrying out an internal investigation in to the claims of bribery, hiring the former FBI director Louis Freeh and former U.S. senator Joe Lieberman to run the process.

Now a decision by the UK High Court may blow open the case, after it declared that BSGR would have to surrender documents it had, up until that point, refused to hand over, according to the Financial Times.

BSGR has yet to respond to these legal demands, although it has previously stated its intention to fight for control against “those who are trying to steal its assets”.

The case continues.

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