By Jonathan Browne
An emerging battle line seems to be emerging between the Government of Liberia and ArcelorMittal Liberia (AML) over an amended Mineral Development Agreement that has become a bone of contention with both parties claiming breaches.
The 54th Liberian Legislature recently returned the MDA to the Executive for renegotiation, citing several reservations after citizens in the concession areas complained of lack of social development, including infrastructures.
A barrage of written communications between AML and the Government here appears to indicate that all sides are holding their separate grounds, going forth and backward with self-interpretations of the MDA.
In its concerns addressed to the Government of Liberia on Friday 22 April 2022, AML’s parent body ArcelorMittal, says it has become aware of the existence of certain agreements that the government has sought to conclude with third parties, including licenses that it notes, the Minister of Mines and Energy has purportedly issued to third parties, which it observes that on their face, and based on the limited information presently available, gives rise to breaches of AM’s rights under the MDA.
“These apparent violations are at odds with the government’s legal obligations towards AM, and if remained undressed, risk bringing about irreparable harm to AM’s current operations and future business plan”, the company expresses.
It notes that most importantly, these alleged breaches call into question the government’s commitment to its longstanding partnership with AM.
AM reminds that in previous communication with the government thru its letters dated 19 June 2020 and 13 July 2020, respectively, the Government has Mineral Exploration License for iron ore to Solway Mining Incorporated, and contends that under the MDA, it (AM) enjoys “exclusive” right to conduct exploration, development, production and marketing of “iron ore and associated products”, as well as rehabilitation of the associated infrastructure in the Concession Area, citing Article IV(1) of the MDA.
It argues that Solway license is for iron ore and the relevant area is within AM’s Concession Area, saying “Accordingly, it is patently clear that the issuance of the Solway License violates AM’s exclusive rights under the MDA.”
The company also asserts that over the past 16 years (2005–2022), it has invested more than US$1.6 billion in Liberia and created over 1,000 jobs for Liberians.
However, the government counters that it had adequately addressed AM’s concerns about the issuance of Mineral Exploration Licenses to Solway Mining Incorporated for iron ore and graphite and other companies.
“Since you appear to be undeniably oblivious of our previous communications which lay clear the legal and technical premises for our decision to issue these licenses, we wish to restate that the issuance of mineral right over the former LAMCO Concession Area by the Ministry of Mines and Energy and the assertion that the affected rights fall within AML’s Concession Area was done in line with the definition of the Mineral and Mining Laws of 2000 that clearly created the platform for said discussion”, a Ministry of Mines and Energy’s letter dated 23 May 2022 to ArcelorMittal reads.
The letter issued under the signature of Minister Gesler E. Murray argues that while AML obtained assets of the former LAMCO Concession Area under the MDA of 2005 and subsequent Amendment of 2006/2007, the company did not automatically acquire any production or exploration areas for the exploration and exploitation of iron ore thereon.
It emphasizes that because AML declared Production Area in 2005 and was issued a Class A Mining License over the declared area (Mts. Tokedeh, Gangra, Yuelliton) on September 1, 2005, its mineral rights over the former LAMCO Concession areas were trimmed and restricted to the Class A Mineral License area, and areas containing the assets and facilities of the former LAMCO for operation. Coming up GoL accuses AML of not living up to the 2005/2013 MDA