MONROVIA – Following the recent spate of acrimonious exchanges from the citizens of Bomi County over what they say is a complete flouting of the Mineral Development Agreement between the Government of Liberia and the iron ore company regarding its operations in western Liberia, Western Cluster has come out to clarify that it remains committed to ongoing commitment to contribute to socio-economic development in Western Liberia, noting that since 2011, it has invested approximately US$300 million, and paid approximately US$15.5 million as Social development fund contributions to the Government of Liberia.
According to Western Cluster Liberia (WCL) in a press statement read by its Lead External Relation for Administration, Samuel Brown, during a major press conference held on Monday, January 30, 2023, several critical infrastructure projects have been supported or executed by WCL for the public at-large and to ensure positive impact of its operations in the region.
“WCL is intent on honoring the Mineral Development Agreement and its commitments to the Liberian Government and the people of Liberia. The Mineral Development Agreement originally envisaged Western Cluster using railway route from Mano River to River Congo and Bomi Hills to Freeport as is being used by NIOC and LMC respectively. However, the Western Clusters have not yet been allowed access to the aforesaid railway routes, which makes the Western Clusters economically and logistically almost unviable.
“WCL’s operations in Liberia were suspended due to force majeure situations (the Ebola Virus outbreak and the Covid-19 pandemic); which are valid reasons for the suspension of obligations of the Mineral Development Agreement.
“The Memorandum of Understanding is the enabling legal instrument to facilitate the resumption of operations of Western Clusters after the force majeure situation had expired; Western Clusters could not resume operations without such enabling legal instrument,” the statement stated.
Providing a detailed summation of the company’s operations in Liberia since 2011 when it signed an agreement with the Government of Liberia, WCL noted that its subsidiary of Sesa Goa, a Vedanta group company, engaged in iron ore mining in Western Liberia, remains committed to contributing to the socio-economic development in the region, through sustainable business operations, community and infrastructure development initiatives.
“WCL is also working on generating direct and indirect employment opportunities for the locals, across its core and allied business functions and generating collateral investment opportunities for Liberians.
“Since 2011, WCL has invested approximately US$300 million in the country, including payment for the concession rights; US$15.5 million payment to the Community Development Fund; construction of two major bridges – the Klay Junction Bridge and the Gui Town Bridge; upgrading and maintaining the Tubmanburg to St. Paul River Bridge Road; and several other communities and infrastructure development initiatives.
“Vedanta Limited is a multi-billion-dollar mineral resource company and its operations are spread in several countries. The operations of Vedanta Limited are strictly consistent with fundamental principles of good corporate governance with utmost focus on inclusive growth.
“In August 2011 WCL entered into a Mineral Development Agreement with the Liberian Government for the iron ore mine in and about Tubmanburg, Bomi County, the iron ore mine close to Mano River Congo in Cape Mount, and the iron ore deposit in Bea Mountain, also in Cape Mount.
“After submitting its Feasibility Study, WCL applied for Class A Mining License to start operations at the Bomi mines; but that permission was not granted before the 2014 Ebola Virus outbreak. WCL also requested for road permit to start the transport of iron ore from the Bomi mines, as provided by its Mineral Development Agreement; but that permit was not granted before the 2014 Ebola Virus outbreak. Also, as provided by its Mineral Development Agreement, WCL obtained and paid for a 44-acre tract of land at the Free Port for storage of its iron ore before shipment. However, the Ebola Virus outbreak suspended the operations of WCL in Liberia and the Covid-19 pandemic caused the extension of that suspension.
“In 2022 WCL sought to resume its operations; and to facilitate its resumption of operations, a Memorandum of Understanding (MOU) was executed between WCL and the Liberian Government, pending the negotiation of an amendment to the Mineral Development Agreement. The Mineral Development Agreement provides for its amendment due to profound change in circumstances. The Amendment will therefore consider all the profound changes, which have occurred since the Mineral Development Agreement was signed in August 2011 and one of these profound changes, among others, is that Vedanta Limited now owns 100% of WCL.
“Several profound changes in circumstances made it necessary to amend the Mineral Development Agreement; and one of these was that Western Clusters were not allowed access to the railway route used by NIOC from Mano River Congo to the Bomi Hills mine and the railway route used by LMC from the Bomi Hills mine to the Freeport, forcing Western Clusters to construct a new railway to transport iron ore produced by it.
“This Memorandum of Understanding (MOU), which is a temporary instrument that does not affect the Mineral Development Agreement, has been misrepresented in the media for various baseless and unfounded reasons.
“What is important to note is that under no parity of reasoning could WCL resume its operations after several years of suspension without an enabling intermediate agreement with the Liberian Government. The MOU is that enabling intermediate agreement; and pursuant to the MOU, WCL has provided additional monetary contribution to upgrade and maintain the Tubmanburg to St. Paul River Bridge road, which was virtually impassable before. Also pursuant to the MOU, another payment of US$5 million was made for community development for Cape Mount County, Gbarpolu County and Bomi County. And further pursuant to the MOU, the road permit was granted by the Ministry of Public Works and the Class A Mining License was granted by the Ministry of Mines and Energy after a second and more contemporary review of the Feasibility Study.
“It should be acknowledged that the Mineral Development Agreement provides for suspension of obligations where there is a force majeure situation. The Ebola Virus outbreak and the Covid-19 pandemic are force majeure situations during which the Liberian Government declared a state of emergency. Those force majeure situations, which made it impossible for WCL to operate, necessitated the suspension of its operations in Liberia.
“Vedanta Limited and its subsidiary, WCL, are committed to working with the Liberian Government and its people for the mutual benefit of all sides; and we affirm our commitment to work within the framework of the original Mineral Development Agreement, its amendments and any other rules and regulations, which relates to our operations in Liberia. We wish to also assure the Liberian Government and people of our commitment to comply with and abide by all applicable laws, which control or cover our mining operations, especially the Decent Work Act, so that maximum opportunity will be given to Liberians for training and employment.
“Wherever there is any allegation of transgression or violation of any law or regulation, we wish to assure you that we will conduct thorough internal reviews and that appropriate remedial action, where required, will be immediately taken.
“We wish to assure the Liberian Government and people that we are prepared to institute corrective measures to ensure that the Liberian Government and no person stands at a loss, injury, or any inconvenience by our operations. Those officials of the Liberian Government who worked with us and continue to work with us for this restart of our operations were and continue to be vigilant in ensuring that the Liberian Government and people are treated fairly, while strictly adhering to Liberian law, our Mineral Development Agreement and principles of the iron ore industry. We wish to assure the Liberian Government and people of our commitment to these general principles to facilitate smooth and productive mutual benefits for our Group and the Liberian Government and its people,” the press statement concluded.
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