Rio Tinto, the giant mining company, has signed a non-binding accord with Aluminum Corporation of China (Chinalco) on Friday to develop the Simandou iron ore reserve in Guinea in West Africa, Rio Tinto said in a statement.

Rio Tinto currently owns 95 percent of the Simandou project, with another 5 percent owned by the World Bank. Once the deal completed, Rio Tinto's share ownership will be transferred to the newly built joint venture. Chinalco will acquire a 47 percent share of the project by providing 1.35 billion dollars through sole funding of ongoing development during the next two or three years.

"We have long believe that Rio Tinto and Chinalco could work together on major projects for mutual benefit," Rio Chief Executive Officer Tom Albanese said in today's statement, "Chinalco is our ideal partner in this project."

Simandou was said to be the world's top undeveloped iron-ore deposit. The proved iron core reserves exceed 2.25 billion metric tons.

Rio has already spent 600 billion U.S. dollars on exploration and assessment, it said.