Government’s Gamble Backfires: Sesa Goa Cuts 80% in Western Cluster Project

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The Liberian media, most especially the Daily Observer newspaper, talked and talked, and wrote and wrote, warning the Liberian government to tread carefully and transparently with the people’s resources in the Western Cluster.  But the more we talked, the more we wrote, the more determined the government became to hurry ahead and give away the Western Cluster iron ore mines to whomever was willing to spend a fast buck.

First, against our persistent warnings that this company had absolutely no experience in iron ore mining, the government hurriedly sold the Western Cluster to a bogus Israeli company called Elenilto Minerals and Mining LLC.  The Elenilto people, confirming that they had no experience or track record in iron ore mining,  almost immediately sold 49 per cent of its imminent ownership to the Indian steel giant Sesa Goa. We say 'imminent' because Elenilto had not yet signed any paper with the Liberian government, and here they were selling what they did not yet own.  That was in August, 2011.  Just four months later, in December, 2011, Elenilto sold its remaining shares in the concession to Sesa Goa for US$35 million.

The Daily Observer continued to criticize this deal because we said the Liberian government did not know this new company they were dealing with.   Only Elenilto had contacts with these new speculators.  But government went ahead and handed over the concession Sesa Goa. 

Once they started their operation, Sesa Goa, a company whose full background government did not know, showed up one morning and presented to government a most preposterous (outrageous, silly) proposal: they want to ship their iron ore from Cape Mount and Bomi by road on trucks, through Duala to the Free Port of Monrovia!

In its over 50 years of operation, the iron ore firm   Liberia Mining Company (LMC) shipped its iron ore from the Bomi Hills mines by railway,  which LMC built, to the Free Port of Monrovia.  But Sesa Goa said it would cost too much to rebuild the railroad to the Free Port.   The Liberian government also seemed to be in agreement with Sesa Goa, arguing that too many people had built in the path and it would cost US$30 million to pay them off and rebuild the railway.  But there was a public outcry against trucking millions of tons of iron ore through an already congested Duala traffic, on a fragile highway that can hardly manage the regular traffic.

The government had itself to blame for this terrible  proposal, because it did not know enough about Sesa Goa or its capacity to do anything.  Whoever heard about such a thing—road transport of tens of millions of tons of iron ore by road?

Now there is a new and alarming development: Sesa Goa announced recently that it was scaling down to the staggering tone of 80 per cent, its operations in the Western Cluster!  They say the demand for iron ore has suddenly  dropped.  This means that the majority of its workers will be out of work.
Did the government really know who Sesa Goa was, and what kind of company it really is?  Sesa Goa negotiated not so much with the Liberian government as with Elenilto from whom it purchased the concession.

Had the people currently in government been in the opposition today, and had the press been silent on issues of national urgency such as these being discussed in this editorial,  those in opposition would be complaining about media silence on burning national issues.  Now that they are in power, they seem to have great difficulty understanding the role and responsibility of the press. 

But the press MUST understand its role and responsibility because there is too much at stake.

The press has to speak out to help keep the government and the whole country on their guard.  It is this early warning system that will hopefully prevent the country from falling into chaos again.

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