“The AML is concerned about the status of the third modified MDA”
… Says he reaffirms his commitment to Liberia
ArcelorMittal Liberia revealed that it “has learned from unconfirmed media” that the House of Representatives has appointed the conference committee and made other decisions over the past few days regarding the company’s third amendment to the agreement. Mineral Development (MDA), which is awaiting ratification by the legislator.
However, contrary to AML’s assertion that its MDA is pending ratification by the Legislative Assembly, the House of Representatives on March 28 returned the company’s 3rd Amendment to its existing dealership agreement, valued at $800 million, to the president for renegotiation.
The House, which is used to approving almost all concession deals submitted by the presidency, took the unprecedented step earlier in the day to reject the deal in its entirety on the grounds that it was “monopoly”.
Yet the AML in a statement says it is unaware that its MDA was rejected; instead, the House has made appointments to the “Legislative Assembly Conference Committee and a few other decisions over the past few days regarding the society’s amended third MDA, which is awaiting ratification by the Assembly. legislative”.
“The company believes that this amendment to the MDA is in the best interest of Liberia and its people, awarded on September 10, 2021, after more than 12 months of negotiations with the Government of Liberia,” the company said in a statement. “AML remains committed to Liberia with its long-term investments that will deliver a project that will bring unparalleled and far-reaching economic and social benefits to the country for decades to come.”
The statement adds that at this time, AML is awaiting all facts related to the actions of the legislature before making any further statement on this matter.
The letter from the Chamber
In a letter to the president, accompanying the return of the AML’s US$800 million deal, the House expressed doubts about the deal, particularly the impact of the Liberia-Guinea treaty on the ownership, operation and user rights of the Yekepa to Buchana Railway as enshrined in Article 3 of the treaty with Guinea.
the Daily Observer obtained a leaked copy of the letter from the House, signed by Mildred Sayon, its chief clerk, who also noted that the proposed AML agreement essentially ignores key provisions of Liberia’s minerals and mining law , in particular Article 6, Sections 6.1 to 6.3 and Section 5.3 of the Act.
“Mr. Speaker, The Honorable House of Representatives transmits the following recommendations: That the government retain ownership of the railways, Buchanan Port and other related infrastructure; that the government initiate a recruitment process aimed at hiring an independent railway operator to ensure non-discriminatory management of railways and other related infrastructure,” the letter from the Chamber states.
“And any future renegotiation of this concession, other existing concessions and new concessions takes into account the full application of all relevant laws, including the law establishing the WASH Commission and the Land Rights Act,” the letter continues. . “And that future amendments to the AML MDA, other existing concessions and/or new concessions consider a role for the National Housing Authority to ensure standard and improved housing facilities for employees and their dependents .”
The House, having received the proposed MDA on November 24, 2021, cited Article 3, Section 3(f), complaining that such a clause gives the steel giant monopoly control over the infrastructure assets of the Liberia; port and rail infrastructure with the ability to use its exclusive rights to block other users’ access to these sovereign assets.
Article 3, Section F of the revised MDA, titled “Concessionaire’s Capacity as Railway Operator”, gives AML “the exclusive right to continue to serve as operator of the railway for the term and any extended term of this agreement…” Section F(2) places AML “in charge of day-to-day operations for the benefit of all users in accordance with the Railway System Operating Principles and Multi-User Agreement (when it comes into effect). force)”.
Section F(3) allows AML to form a wholly owned subsidiary “for the purpose of recording all costs, expenses, revenues and activities associated with the operation of the railway…” under certain conditions. The House, having received the proposed MDA on November 24, 2021, cited Article 3, Section 3(f), complaining that such a clause gives the steel giant monopoly control over the infrastructure assets of the Liberia; port and rail infrastructure with the ability to use its exclusive rights to block other users’ access to these sovereign assets.
Moments after the ArcelorMittal deal was rejected, House Speaker Bhofal Chambers called the House plenary’s decision “the greatest achievement for humanity”.
“All we do is look out for the best interests of the Liberian people,” the president said. “In the wisdom of Plenary, they have decided to…address the interests of our people. I think that’s one of mankind’s greatest accomplishments – selflessly serving our people,” noted President Chambers. “Our concern is the act of valorization, the added value to the process. So that’s what we’ve cataloged and felt that there’s no way we can get the concession deal to pass here without the executive not renegotiating.
The Government of Liberia and ArcelorMittal Holdings AG entered into and entered into the MDA on August 18, 2005, which was ratified by the Legislative Assembly, signed by the President, and printed on prospectuses. The agreement was subject to two different amendments, on December 28, 2006 and January 23, 2013, respectively.
The 3rd amendment, which was signed on September 9, 2021, could pave the way for the expansion of the Company’s mining and logistics operations in Liberia and allow ArcelorMittal to significantly increase the production of premium iron ore, generating a number important new jobs and broader economic benefits for Liberia.
It includes the construction of a new mill and an expected substantial expansion of mining operations, with the first concentrate expected in late 2023, reaching 15 million tonnes per annum (“mtpa”). Under the agreement, the company will have reservations for an expansion of at least 30 million tonnes, while other users may be allowed to invest in additional rail capacity.
An analysis of the recommendations of the House of Representatives and the Senate regarding the 3rd ArcelorMittal Liberia amended MDA is attached to this article.