HPX US$37m a gesture of goodwill 

The advance payments of US$37 million by HPX Group into the Liberian Government’s Revenue Account at the Central Bank of Liberia in December 2019 and March 2022 were a refundable gesture of goodwill, HPX Group said in a statement Tuesday, December 19.

The Government of Liberia and HPX Group subsidiaries Ivanhoe Liberia and SMFG entered into a Framework Agreement on 20 December 2019. 

It was subsequently amended on 30 March 2022. The purpose of the Framework Agreement was to set forth the framework for the negotiation of an agreement to secure sufficient rail and port infrastructure in the Yekepa-Buchanan rail and port corridor to be able to evacuate iron ore from HPX’s Guinean-Nimba Iron Ore Project. 

The Framework Agreement as amended was announced publicly and received strong support from the Government of Liberia. 

Since 2019, the source said HPX has continued to negotiate with the Government of Liberia on terms and payments that would be payable to the Government of Liberia once the final agreement is signed. 

The group argued that the Framework Agreement merely committed the parties to engage in good faith negotiations of a concession agreement on terms that would then provide access to government-owned rail and port infrastructure.

It added that it was not an agreement for the actual use of those assets, and it did not require ratification under Liberian law. 

According to the statement, the payment of the USS$37m was done through the United States Government’s Federal Reserve Bank of New York. 

It explained further that HPX Group agreed, as a gesture of goodwill, to make refundable advance payments to the Government of Liberia at its official request of some of the anticipated fees and taxes that would be due and payable to Liberia if and when a binding concession agreement came into force. 

If none did, it said, these advance payments would be refundable to the HPX Group. 

These advance payments, which were paid into the Government of Liberia Revenue Account at the Central Bank of Liberia consisted of US$7 million in December 2019 and US$30 million in March 2022. 

The advance payments are refundable if certain milestones relating to the negotiation and implementation of the concession agreement are not met. 

As it stands today, the source noted that several of these milestones have been missed and the HPX Group has reserved its rights to seek refund of the upfront payments.

The HPX Group has not done so because of ongoing discussions with the Liberian Government that the HPX Group believes will ultimately result in an agreement beneficial to both Liberia and the HPX Group. 

The HPX Group has always been entirely transparent about the fact that the advance payments were made to the Government of Liberia and publicly disclosed them. 

It detailed that the HPX remains committed to the development of a world-class infrastructure corridor, owned by the Government of Liberia, and operated under the principles of non-discriminatory, multi-user access with each participant to meet responsible access charges, under the oversight of an independent operator not linked to mining operators. 

HPX says remains committed to supporting the Government of Liberia to achieve this vision and welcomes full transparency of all transactions and dealings between the Liberian Government mining companies and other concessionaires. 

As a US Company, HPX, and its directors and management remain committed to and strongly embrace the highest standards of ethical behavior that are in line with community and government expectations not only in Liberia but internationally and are subject to and committed to fully complying with the laws of Liberia, the United States of America and other jurisdictions governing all such transactions.