Beny Steinmetz suing George Soros, Rio Tinto over Simandou iron ore mine rights
Beny Steinmetz, Israeli billionaire and founder of BSGR, has filed a lawsuit against George Soros and Rio Tinto for billions of dollars. The move was spurred for the hope of retribution after he lost the rights to the Simandou project in Guinea, the most prized iron ore deposit in Africa. The 100-kilometer stretch of mountains in the West African jungle has more iron ore than any other undeveloped deposit in the world.
The suit was filed at the High Court in London, and the details are as of yet unknown. The assumption is, however, that Steinmetz believes that Rio, Soros and Global Witness banded together in a conspiracy to force Steinmetz out of the iron ore site.
The Simandou site could be at a standstill for years, as there are several ongoing lawsuits regarding the potential iron ore mine. For example, Vale, Brazilian mining giant also involved in the controversy, is suing BSGR, its former partner in acquiring the Simandou project. Also, last week, BSGR filed a case at the International Centre for Settlement of Investments Disputes in Washington against the government of Guinea.
To better understand what’s at stake and who’s involved, read on.
In April, the President of Guinea revoked Steinmetz’s right to half of Simandou (currently, the other half is licensed by Rio Tinto). An independent panel, supported by Global Witness, alleged that Steinmetz has originally won the rights through acts of corruption. This ruling led Conde to take the license.
This May, Rio filed a racketeering suit in New York based on events several years ago. The company claimed that Vale and BSGR, Steinmetz’s company worked together on a conspiracy of their own to oust Rio Tinto from the Simandou project.
President Conde was elected in 2010. One of the goals of his presidency was to stomp out corruption.
George Soros is an 83-year old investor. Although he is now known as a philanthropist and enemy of corruption, he was first known as the “man who broke the Bank of England,” after betting against the pound in 1992 and making $1 billion off of the venture.
Global Witness is partially funded by Open Society, and partially by the Alexander Soros Foundation, which is run by George Soros’s son.
Beny Steinmetz made his fortune in diamonds. His company, BSGR was awarded half of Simandou in 2008. Rio Tinto originally held the rights to the land, but had their licenses revoked. Rio Tinto was able to recover some of the rights by paying $700 million.
British Lithium Pressured Due To Calls for Electric Cars
The British demand for lithium is set to reach 75,000 tonnes by 2035 as the government works towards their ban on the sale of high-polluting diesel and petrol vehicles within the UK. This comes as automakers worldwide continue to insist on the benefits electric vehicles will have on slowing the rate of climate change.
It is estimated that the UK will require 50,000-60,000 MT of lithium carbonate a year by 2035 for battery production to satisfy government needs. This is assuming production remains at 1.2 million vehicles per year, and the amount of lithium required does not increase.
British Lithium, which hopes to begin constructing a quarry to produce 20,000 MT of lithium carbonate a year in a $400 million investment, are not without competitors, both within the UK and abroad.
Competition For Lithium Rises In Europe
After only five years after its initial launch, Cornish Lithium is setting its sights on becoming a UK powerhouse in mining lithium, aiming to begin commercial production in under four years. Jeremy Wrathall, a former investment banker and current managing director of Cornish Lithium, had the future in mind when founding the company.
“In 2016, I started to think about the electric vehicle revolution and what that would mean for metal demand, and I started to think about lithium,” he said in an interview with AFP. “A friend of mine mentioned lithium being identified in Cornwall, and I just wondered if that was a sort of unrecognised thing in the UK.”
Lithium was first discovered in Cornwall around 1864 and has not been mined again since 1914 when it was produced as an ingredient in fireworks. Now, however, Cornish Lithium is reportedly in the testing stage to see if the metal can be produced commercially to meet the growing demand required for the electric car sector.
Despite Cornwall’s close historic ties to mining lithium, Wrathall insists that the project is purely commercial.
Cornish Mining Revival For Lithium Production
“It’s not a mission that drives me to the point of being emotional or romantic,” he says. “It’s vitally important that we do get this technology otherwise Europe has got no lithium supply.”
The European Commission has also stated their goal to end the sale of new petrol and diesel cars by 2035 to aid the environment. That being said, the majority of lithium extraction currently relies on power provided by environmentally damaging fossil fuels─a slight contradiction.
Alex Keynes, from the Brussels-based lobby group Transport & Environment, is adamant that mining for lithium should be done sustainably.
“Our view is that medium-to-long term, the majority of materials including lithium should come from efficient and clean recycling.
“Europe from a strategic point of view should be looking at securing its own supply of lithium.”
Despite growing competition from abroad, British Lithium Chairman, Roderick Smith, continues to place importance on the mining of lithium within the UK.
“Imagine what the UK economy would look like if we lost our automotive industry,” Smith says. “The stakes are high for the UK.”
Smith expects the UK to compete with other European countries to secure a lithium battery plant in the near future.