China has been granted sole rights by Gabon's government to exploit huge untapped iron ore and build costly rail links needed to reach the site in the tropical forest, officials said.

A Chinese consortium headed by the China National Machinery and Equipment Import and Export Corporation (CEMEC) has been granted the rights, said a statement published in the government daily L'Union.

It said the Gabonese state would have a share in the project but gave no details of the cost of the massive contract. But an informed source said work would be launched at the end of the year and the first ore would be extracted before 2010.

The decision kicks out the world's leading iron miner, Brazil's Vale do Rio Doce (CVRD), which since April last year had headed a consortium with China's CEMEC and Sinosteel, along with the French group Eramet.