US$536.4M Eton Financing Agreement Ratified
The Liberian Senate will convene in another special session this morning seventy two hours after convening on Friday to, as expected; concur with the House of Representatives to ratify the US$536.4M financing agreement between Eton PTE loan and the Government of Liberia.
Today’s special session, the third since this government came to power, starts at 11 a.m. in the chambers of the Senate and will “consider ratification of the Mineral Development Agreement between Hummingbird Resources and the Government of Liberia, and the pre-financing Agreement between EBOMAF and the Government of Liberia, according to the office of Senate Pro-Tempore, Albert T. Chie.
On Friday, the Senators during a special session presided over by the President of the Senate, Vice President Jewel Howard-Taylor, and the Pro-temp Albert Chie chairing the Senate that was converted into a committee of the whole as expected, raised some of the pressing issues that have been discussed among ordinary citizens, the media and some opposition political parties, including financial experts.
The day-long sitting brought into attendance also, the Minister of Justice, Cllr Frank Musah Dean, Minister of Public Works, Mobutu Vlah Nyenpan, Central Bank Executive Governor Milton Weeks, and Deputy Minister for Fiscal Affairs at the Ministry of Finance and Development Planning, R. Samora P. Z. Wolokolie.
For instance, Senator Sando Johnson who claimed to have problems with the sovereign guarantee, wondered which one of the resources of the country would the government surrender as collateral; but CBL Governor Weeks clarified that the Government’s obligation will be limited to its consolidated account which is retained at the CBL into which goes the revenues, and which government uses to pay all of its obligations, including salaries.
On the question as to why the Minister of Justice failed to attest his signature to the loan agreement as is the case in all such financial agreements, Cllr. Dean stated, “Normally, the Minister attests to the agreement of this nature, but I was not in the country when the agreement was being signed, but I took part in the negotiation. I have done more than attestation, I have given you a legal opinion which analyzes the loan and I showed you documents that I reviewed which is my fair opinion, I have gone beyond attestation.”
Rivercess County Senator Francis Paye in his motion following the plenary, recommended for concurrence, which was seconded by Sinoe County Senator Milton Teahjay, who pleaded with his colleagues to adopt and concur with the House of Representatives “in the interest of the Liberian people.”
On Tuesday, June 5, 2018, the House of Representatives passed the loan agreement with a vote of over 40 members, and it followed a day after the Lower House conducted a public hearing in the Joint Chambers of the Legislature, considered by political commentators as mere formality.
Again on Thursday, the Lower House again went ahead with a unanimous vote to ratify the loan, which seeks to construct 256.2km of roads, between the EBOMAF SA Company (Entrepreside Bonkoungou Mahamadou and Fils) in the amount of US$420.8 million.
It may be recalled that President Weah recently submitted the loan agreement to the Legislature and was immediately hit with many questions, mainly on the legitimacy and existence of Eton Finance Ltd.
In November 2016, the Senate Joint Committee on Lands, Mines, Energy, Natural Resources & Environment; Judiciary, Claims, Human Rights & Petitions and Investment & Concessions, recommended to the plenary of the Liberian Senate to postpone ratification process of the proposed Mineral Development Agreement between the Hummingbird Resources (Liberia) Incorporated, pending some explanations from the Executive.
According to the joint committee’s report, principally the lumping of four exploration licenses into a single Mineral Development Agreement instead of four separate MDAs, and the lack of a plan in the MDA towards the development and mining of the over four million ounces of inferred gold resources discovered in Sinoe County are concerns that need explanations from the Executive.
The committee in its concluding report to plenary noted that the lumping together of the four exploration license areas into a single MDA instead of four in line with the New Minerals and Mining Law approved on April 3, 2000; will lead to revenue loss to the government in the tune of millions of United States dollars; “and significant reduction in social development funds and other benefits to the affected communities and the counties of Sinoe, Grand Kru, River Gee and Maryland.”
Besides the loss of revenue and benefits, the committee maintained that the areas could be susceptible to limited and impetuous exploration work, which could result into some of the areas prematurely and unjustifiably been declared uneconomical and making them relatively unattractive for future investment.
In the findings of the committee, during the formulation of the MDA, there should have been a provision setting aside a production lot (s) over the areas in Sinoe where the gold has been discovered or the company given a maximum of one year to declare production areas.
“Allotting the company five (5) additional years for exploration over these areas containing a minable gold resource after exploring for ten years, is excessive and the legal, technical and economic bases are debatable, ” the joint committee concluded.
The ratification of the Mineral Development Agreement between the Government of Liberia and the Hummingbird Resources (Liberia) Inc., is one of several documents sent to the Legislature after they were recalled by President Ellen Johnson Sirleaf through a proclamation.