The National Bureau of Concessions (NBC) has accused global steel giant ArcelorMittal-Liberia (AML) of being in deliberate violation of the Mining Development Plan (MDP), which was signed with the Government of Liberia (GoL) in 2005 and amended in 2007 and 2013.
The Director-General of NBC, Gregory Coleman, said AML remains non-compliant in several areas of the MDA and is adversely affecting the livelihood of the people living in the affected communities of Grand Bassa and Nimba counties.
In a letter to the House of Representatives on Thursday, May 31, the NBC boss said their complaint followed a monitoring tour conducted in April 2018.
Mr. Coleman maintained that AML failed to move to Phase II of its operation on the expansion and upgrading of iron ore production (ROM) capacity from 5mtpa to 10Mpta, for instance producing 10Mpta with an upgraded Rail and Port; and their mining in Gangra; it is not clear whether or not they got authorization from the government, and there was no feasibility study done.
Mr. Gregory said the AML has not constructed the Concentrator in order to start the mining of the low-grade ore but is only mining Direct Shipping Ore (DSO). Below are further allegations by Mr. Coleman and their responses by AML point by point after the Daily Observer contacted the management for its reaction.
In its response to the alleged AML’s failure to construct the Concentrator in order to start the mining of the low grade ore, AML said: “As the originally planned phase 2 project of 15Mtpa of concentrate sinter fine ore product was severely impacted in August 2014 due to the declaration of force majeure by our construction contractors following the Ebola virus outbreak. ArcelorMittal Liberia had to move ore extraction from its depleting DSO (direct shipping ore) deposit at Tokadeh to the nearby, lower impurity DSO Gangra deposit while plans for restart of construction based on a new feasibility study was being undertaken to utilize the significant lower grade resources at Tokadeh. The results of the feasibility study are anticipated at the end of 2018.
“ArcelorMittal remains committed to Liberia where it operates a full value chain of mine, rail, and port and where it has been operating the mine on a DSO basis since 2011. The Company believes that ArcelorMittal Liberia presents a strong, competitive source of product ore for the international market, based on continuing DSO mining and subsequent shift to a high grade, long-term sinter feed concentration phase.”
The NBC Director-General indicated that the AML has failed to pave the Ganta-Yekepa road, reconstruct the bridge on the 2.5km road linking the AML offices in the defunct LAMCO Camp to the City of Buchanan, and in its response, ArcelorMittal Liberia said:
“ArcelorMittal Liberia is now fully committed to contributing to the development of the Ganta Yekepa (GY) road and have accordingly informed the Government of Liberia. Constructive meetings have already commenced with the Ministry of Public Works.
“As for the 2.5km bridge, the technical staff of ArcelorMittal and Public Works did an assessment of the bridge in 2013, but due to the length of time passed, the Company has contacted Public works for another joint assessment. In the meantime, ArcelorMittal Liberia has secured funds for the bridge. Superintendent of Grand Bassa is aware of ArcelorMittal Liberia’s efforts. These are positive outcomes for the country of Liberia and the residents of Buchanan.”
Director Coleman claimed that the AML failed to equip the AML operated hospitals in Buchanan and Yekepa to the standards set by the Ministry of Health as well as secondary and elementary schools. He noted that the AML Buchanan Hospital is closed to the public and there are no current textbooks in the library and no equipment and chemicals in the science laboratories.
In response AML said: “Our hospitals are equipped with the following standards and facilities: A well-equipped medical laboratory; X-ray facility; Two operation theaters; Outpatient emergency rooms; Trauma room; Occupational health, with pre-employment medical checks; Free public health with medical outreach; Ministry of Health public health and medical activities; Inpatient services; 60-bed capacity; Anti-retroviral treatment, including free AIDS treatment, drugs, and counseling; Two ambulances. We believe that all employees and community dwellers should have access to quality healthcare and are dedicated to ensuring our hospitals provide the best care. The Company recently met with the Ministry of Health to discuss portioning of certain areas of the hospital for the residents of Grand Bassa, due to the fire that impacted the Government hospital.
“ArcelorMittal Liberia management agreed to grant the request and will renovate the portion given to Grand Bassa and provide private access for residents. ArcelorMittal’s schools in Yekepa are currently transitioning to new Ministry of Education guidelines. Textbooks are currently available for students but all students will be transitioned to the new books upon their arrival. The company may have experienced challenges in stocking its laboratory in the past two years when cost control was the focus, but steps have been put in place to resolve the issues in the very near future.”
Mr. Coleman further said AML is in labor and welfare abuses which are not in full compliance with the MDA and in accordance with the Labor Practices Law of Liberia and the Decent Work Act.
AML’s response: “AML policies and procedures are strictly in compliance with the Decent Work Act and all applicable laws of Liberia. AML is not involved in any mal-labor practice.”
“Having operated for over 10 years, 50% of the Senior Management Positions in AML should be held by Liberians; NBC did not find evidence of adherence to this provision of the MDA,” Coleman said.
ArcelorMittal Liberia responded that it “has Liberians in over 52% of our senior management positions. Liberians head the following departments (government affairs, human resources, communication, port and rail, continuous improvement, IT, and security).”
Coleman added: “NBC observed that AML is not in full compliance with the Environmental Protection and Management Law of Liberia as stipulated in the MDA. In an attempt to mitigate environmental degradation, the AML is constructing dams in order to stop the flow of sediments from the mines to the communities below; and it has assigned staff to begin to segregate the solid waste before disposal, which is in international best practice.”
Responding to this, the company said: “ArcelorMittal Liberia has always complied with international standards and the Environmental Protection and Management Law of Liberia. The sediment dams that were constructed and being utilized are designed by specialist engineers and checked for stability under different conditions, the dam’s foundation reaches a firm rock. It was constructed with specially selected laterite compacted in layers, with said construction overseen by geotechnical engineers from the global consultancy company, AMEC. There is constant monitoring at the dam to ensure its structural integrity, with weekly surveys by engineering staff from the Projects office to see if there is any settlement of the earth dam. A full Operation, Maintenance and Surveillance Manual have been developed.
“In terms of compliance to the Environmental Protection and Management Law of Liberia, AML implements the following activities: Identification of potential impacts through the completion of Environmental and Social Impact Assessments (ESIA); Mitigation of impacts through implementation of Environmental Management Plans; Assessing of the impact of our activities through a comprehensive monitoring system; Compensation of the loss of biodiversity through the implementation of a Biodiversity Offset program; and Completion of third-party environmental audits to assess compliance to the recommendations of the ESIA’s and EMP’s.
“Specific measures include the design and construction of sediment control structures to capture sediment and ensure the release of run-off that meets Liberian water quality standards. The environmental monitoring and auditing completed confirming that AML is compliant with the conditions as stipulated by the EPA through the various environmental permits. In instances where audits and inspection visits by the EPA indicate shortcomings, AML implements corrective actions.”
The National Bureau of Concessions was established by an Act of the National Legislature effective September 23, 2011, to implement this strategic economic policy and to provide the governance framework necessary for coordinating the post-concession award process including monitoring, evaluating and reporting as a basis for enforcing (in cooperation with relevant Ministries) concessionaires’ and Government of Liberia’s compliance with the obligations contained in the Agreements or Management Development Plans.
Meanwhile, members of the House of Representatives have unanimously voted for the NBC’s report on AML to be sent to Joint Committee on Investment and Labor, to report in one week.