Rio Tinto PLC (LSE:RIO) and a Chinese consortium have been warned they could lose their mining licences if they do not meet a tight construction deadline for the Simandou iron ore mine in Guinea.
The warning came on Saturday, when the ruling junta signed a deal with Rio Tinto and Winning Consortium Simandou (WCS) to get Simandou's high-grade ore to market.
The two companies are to work together on a 670-km railway and port.
In a video statement on Twitter on Monday night, Guinea's presidency said that "the framework agreement gives Guinea a very precise schedule with extremely severe penalties, including the revocation of the miner's licence."
The railways and ports are expected to be completed by the end of 2024 and commercial production will begin by March 31, Guinea's mines minister said.
The mining firms control Simandou and Rio Tinto was first granted an exploration licence in 1986, but is yet to start work on its development.