Liberia’s Finance Minister, Amara Konneh, says “if Western Cluster Limited (WCL) is allowed to undertake its proposed means of transporting iron ore from Bomi Hill Mines (by means of trucking) over its concession time period, WCL’s projected capital investment will increase by US$560 million in 2-3 years and more than US$2 billion in the next ten years for all three mines.”
He said that WCL’s contribution to government revenue is estimated to increase to US$50 million per year for Bomi mine and increase to US$400 million per year when all three mines that make up the western cluster are fully operational.
According to Minister Konneh, WCL’s mining activities will create 1,000 jobs during the Bomi Hill mines project construction, 675 jobs during operation stage, and 600-1000 jobs during the construction of the railway.
Minister konneh noted that it will cause the government and the company huge sum of money for building the railway from Bomi County to the Freeport of Monrovia. He said many citizens have built over eight hundred structures in the right-of-way of the rail, thereby causing huge financial burden to relocate them.
Minister Konneh said the company has proposed to the government to truck iron ore from Bomi mine to the Freeport of Monrovia meanly at night. He indicated that the company has offered to rehabilitate the road from Tubmanburg to Monrovia to allow the free flow of traffic along the corridor.
He said the government needs to decide whether WCL will not export any iron ore until the company builds the railway which was destroyed during the civil war, or identify a new place where the company can build a new railway line.
“The government also has a choice to tell WCL to repair the road from Bomi Hill to the Freeport of Monrovia, and transport the ore at night, while at the same time the company is building the railway,” Minister Konneh said.
The Minister also pointed out that by allowing the company to transport the ore from Bomi to Freeport via truck will bring revenue to the government and the company. He said the government is currently studying the proposal and will shortly make a determination in the interest of the country.
However, a citizen of Bomi County, Mr. Boima Gbelay said “trucking the iron ore from the mine in Bomi to Monrovia will be a violation of the Mineral Development Agreement signed between the company and the government. He added that it will also create environmental problems for the citizens living along the way.”
For her part, Ms. Fatu Konneh, a student of the University of Liberia and a citizen of Bomi County, hope that the decision to truck the ore to Monrovia will impact her county. “For too long our people have live in abject poverty and it is my hope that this agreement will benefit our county and improve the living condition of the citizens.”
In a related development, Minister Konneh has disclosed that China Union’s capital investment for phase two is certain to increase if the housing units and the rehabilitation of the railway are taken care of in a timely manner. He added that China Union is expected to ship 50,000 tons of iron ore before the end of 2013 and 800,000 tons in 2014.
Furthermore, he said China Union will contribute US$4-5 million per year and has planned to increase its current employment of 232 Liberians to 459 in the span of a year.
Meanwhile, Minister Konneh has disclosed that the mining sector is one of the growing sources of export earnings and government revenue in the economy, with the contribution from iron ore growing most rapidly. Mineral royalties from iron ore surged from about US$0.65 million in 2011 to more than US$6 million in December 2012.
He intimated that the Government of Liberia has resolved to assist and support iron ore mining concessions in meeting their production and export targets. He noted constraints and opportunities for ensuring companies meet their timeline. The Finance Minister said the government is working with concession companies to identify deliverable, with urgency needed in addressing bottlenecks for China Union and WCL.
In the early sixties, many foreign companies extracted iron ore from Liberia and shipped it Europe. Iron ore from Bomi Hill, Bong Mine and LAMCO built major parts of Europe. However, the areas those ores were extracted from, including Bomi County remain very poor and underdeveloped.
Already, the Government of Liberia has admitted to making serious errors in the awarding of many concession agreements, including WCL previously Elenilto Mining and Minerals, a company that did not present financial statement, technical experience and has no history of mining anywhere in the world.
As it stands, Bomi County from where WCL wants to truck the iron ore is one of the poorest Counties in Liberia with at least 11% of the population going to bed without food.
According to Liberia Food Security and Nutrition Survey released in June of 2013,
Bomi County is the most food insecure county in Liberia: “on average, households in Bomi County spend 69% of their income on food, the highest in the country. 11% of households had experienced a shock in the last seven days, coping by going the entire days without eating as compared to 2% national average. 40% said their major difficulty was high food prices in the last six months. A fifth of households consume just one meal a day.
A high percentage of households are female headed (32% vs. 25% national average) and headed by widows/widowers (14% vs. 9%). Education levels are lower than average – just 62% have attended school vs. 70% nationally. The share of households with a chronically ill or disabled member is double the national average at 12%.
Sanitation levels are deplorable with 91% of households having no access to a toilet compared with 65% nationally. Land access is very tenuous – 83% have no deeds for their plot compared with 66% nationally. Some 31% of households are involved in charcoal production, one of the livelihood groups that support the most food insecure people.”
Source: Roland Perry/ Informer
Get the latest news and updates on Ghana’s oil and gas value chain by following us Reporting Oil and Gas on twitter @oilgasghana and like our facebook page and get at us on Google+. Subscribe to our group to get update