Heads roll at Rio Tinto over Simandou probe — Davies, Valentine fired

Rio Tinto’s (ASX, LON:RIO) recently launched probe into a payment made to an external consultant over the Simandou iron ore project in Guinea, just turned nasty, with the company firing two of the executives involved in the case and one of them threatening with legal actions.

The world’s second largest mining company said Thursday it had terminated the contract of Alan Davies, chief executive of its energy and minerals unit, as well as Debra Valentine’s, the Rio executive in charge of legal and regulatory matters as a result of the internal investigation.

Davies, who was suspended on Nov. 9 over the $10.5 million payment to consultant in 2011 for assisting in negotiations with Guinea’s government on the Simandou project, said Thursday Rio Tinto had no grounds to fire him and that he will take the company to court.

Fired energy and minerals boss Alan Davies has vowed to take the "strongest possible legal action" against Rio. (Image from archives)

“I have not been privy to Rio Tinto’s internal investigation report, nor have I had any evidence of the reasons for my termination of my employment given,” Davies said in a statement quoted by The Herald Sun.

He added that the company has not respected his rights as an employee, nor given him an opportunity to answer any allegations.

Davies was in charge of the iron ore project in 2011, when the payments were made and also the same year that Rio signed a major agreement with the Government of Guinea, which secured the firm's mining title.

The company announced in October it was fully exiting the project by selling its stake to partner Chinalco for up to $1.3 billion, with payments to begin with commercial production.

Davies, a 20-year veteran at Rio and member of the executive committee, was only promoted to the top role in the energy and minerals division in June this year, after a shake-up of the firm’s operations.

He was also a member of Rio Tinto’s ethics committee and will be replaced by Bold Baatar, the current managing director of Marine and vice president Iron Ore Sales and Marketing.

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