PHOTO: AML Yekepa, Nimba operations
By Our Reporter
After major amendments, the House of Representatives this week passed the ArcelorMittal Liberia US$800 million 3rd amended agreement, reflecting some of concerns recently raised by citizens about the original draft that came from the Executive Mansion.
A key point of contention, which the House amendment now reflects, concerns the use or expansion of all public infrastructure such as ports, rails, utilities and any other public facilities, and any limitations or sole exclusivity granted in the MDA to ArcelorMittal.
On this point, ArcelorMittal Liberia in the past has held the position that it should retain control of the Yekepa to Buchannan rail and certain port infrastructure the company has developed, even though those infrastructure are sovereign assets of the Republic of Liberia. Many industry analysts disagree with this position and argue instead that public infrastructure should never be under the exclusive control of any one company but should be under the control of the Government.
According to the House, Article 3, Section 3(f) of the ArcelorMittal deal submitted by President Weah, entitled, ‘The concessionaire’s capacity as Railroad Operator’, gives the steel giant monopolistic control over Liberia’s infrastructure assets; the port and rail infrastructure with the ability to use its exclusive rights to block other users’ access to these sovereign assets:
President George Manneh Weah and the CEO of ArcelorMittal, Lakshmi Mittal recently signed a revised Mineral Development Agreement (MDA) on Friday, September 10, extending the company’s concession in Liberia for an extra 25 years.
But since the agreement, valued at US$800 million, was signed and forwarded to the Legislature for ratification, there has been a rather disturbing silence from the Government of Liberia concerning the details of the revised and extended concession agreement.
This is how the House joint Committees informed plenary Lawmakers endorsed and voted on proposed modifications:
“Access to and expansion of port infrastructure is under AML’s complete control and for its exclusive benefit. Other users’ port expansion limited to a very specific location, it appears no technical studies were carried out to demonstrate the viability of the area assigned for multi-user port operations.”
“Other users can only carry out rail expansions subject to very tight controls and exclusivity granted to AML. AML has the ability to block expansions which ‘unreasonably interfere’ with its operations, and it is AML who determines if this ‘interference’ has occurred,” the Joint Committee added. “In practice, expansion of the port or railroad by another user is impossible until 2034 and very difficult to envisage thereafter. AML will also develop the railroad system operating principles and will develop the multi-user rail agreement without any input from other users or potential users, which mean any other user, will be forced to comply with AML’s rules. There is no effective timely remedy if AML decides to favor its own operations and discriminates against other users.”
“The Proposed Amendment should be amended to allow for transparent non-discriminatory access to Liberian infrastructure assets, with appropriate oversight by the Government, consistent with other successful multi-user models and best international practice. This is so that Liberia receives the maximum benefit to be derived from its infrastructure assets and natural capital. It also means that Liberia is prevented from realizing a given economic potential of its infrastructure assets.”
“The committee recommends that the Proposed Amendment should ensure that other users’ access to the Liberian infrastructure assets is protected, to allow Liberia to fully realize the economic potential of these assets and provide the Liberian people with greater job opportunities.”
Later, the House voted the Committee request that Article 9 “Entitled Land And Facilities,” section 3 (d)(4). It is “Entitled Operation And Maintenance Of Railroad And Port Infrastructure” be amended in the proposed Amendment.
It is stated below:
- The GOVERNMENT maintains ownership of the Railroad, Buchanan Iron Ore Port, and related Infrastructure (the “Liberian Infrastructure”). Accordingly, the CONCESSIONAIRE acknowledges that the rights of the CONCESSIONAIRE shall remain subject to the sovereign rights of the GOVERNMENT and the Republic of Liberia.
The Liberian Infrastructure will be structured, regulated, expanded, and managed on a non-discriminatory multi-user basis for the benefit of all Eligible Applicants and the Republic of Liberia. Each Eligible Applicant will have (i) a right of access to Liberia’s infrastructure to enable it to construct and carry out its own transportation activities, and (ii) a right to be involved in the operation of the Liberian Infrastructure on and from its designation as Eligible Applicant, in each case so as to ensure that all Eligible Applicants (including the CONCESSIONAIRE) have equal priority in respect of the construction and operation of their transportation activities (both as to timing and volumes) on the Liberian Infrastructure;
- the CONCESSIONNAIRE shall work with the GOVERNMENT to establish passenger and general freight traffic on the Railroad for the benefit of surrounding communities, provided that such non-mining traffic does not unreasonably interfere with the operations of any Eligible Applicant;
- following the GOVERNMENT’s granting to another Eligible Applicant of a capacity expansion authorization (with respect to the Railroad) or a Berth Expansion (with respect to the Port), the Railroad System Operating Principles, the MUA, and any other operating principles in relation to the Liberian Infrastructure agreed between the Parties from time to time (the “Infrastructure Operating Agreements”) shall be amended in such manner as the GOVERNMENT considers fair and reasonable in order to maximize the economic development of the Republic of Liberia and to implement the principles of this Section 3(d)(4); and
- the CONCESSIONAIRE shall negotiate any amendments required pursuant to subparagraph C above and any further agreements between an Eligible Applicant and the Parties as may be reasonably required by the GOVERNMENT in connection with such Eligible Applicant’s capacity expansion authorization and/or Berth Expansion in good faith and within a timeframe that is compatible with such Eligible Applicant’s implementation calendar as envisaged by Article 6.1 (Execution of the Right of Access to Railway Infrastructure) of the treaty between The Republic of Liberia and The Republic of Guinea dated 11 October 2019 and given full legal effect by the Republic of Liberia on 6 May 2021 and the Republic of Guinea on 18 February 2020 (the “Implementation Agreement”).
In line with section 5.3 g (3) the Minerals and mining laws of 2000, the Committee said that concessionaires declared production areas of old LAMCO concession areas. The Minerals and Mining law referenced here states in relevant parts that “ in the event where the holder of an exploration license declares only a portion of the exploration areas production areas, the remaining portion not declared must be surrendered to the government and exploration license shall cease to exist”.
“Currently ArcelorMittal Liberia is relying on an agreement that contravenes the most recent mining law of 2000. The previous MDA according to Article 1 (1.7); Article IV (2) defines AML’s concession area as the former LAMCO concession area instead of the production areas declared by the concessionaire.
Several weeks ago, a consortium of seven Liberian media institutions are filing a Freedom of Information (FOI) request, demanding full disclosure of the details of the revised MDA and believes that the process should be more transparent. The media institutions, comprising mostly newspapers and a couple of online-only news outlets, include The Inquirer, New Dawn, New Republic, The News, News Public Trust, The Daylight and the Daily Observer.
But to date, the Mines and Energy Ministry is yet to make the document available.