Monrovia-Government and ArcelorMittal (‘the Company’), the world’s leading steel company, have signed an amendment to the Mineral Development Agreement (‘MDA’) estimated at US$800 Million, which paves the way for the expansion of the Company’s mining and logistics operations in Liberia.
With the MDA amendment coming into effect, the ArcelorMittal Liberia will significantly ramp up production of premium iron ore, generating significant new jobs and wider economic benefits for Liberia.
The expansion project – which encompasses processing, rail, and port facilities – will be one of the largest mining projects in West Africa.
The capital required to finalize the project is expected to be approximately $0.8 billion, as it is effectively a brownfield expansion.
The expansion project includes the construction of a new concentration plant and the substantial expansion of mining operations, with the first concentrate expected in late 2023, ramping up to 15 million tonnes per annum (‘mtpa’). Under the agreement, the company will have reservations for expansion for at least up to 30mt. Other users may be allowed to invest in additional rail capacity.
During the signing ceremony Friday, September 10, President George Manneh Weah said the signing ceremony demonstrates Arcelor Mittal Chief Executive Officer promised made to him, during his visit to France and signal to the world Mittal trust and confidence in the future of Liberia as an investor-friendly country, and also to confirm to investors around the world that Liberia remains open for serious business and investment.
“In my turn, I also promised him that if such an event were ever to happen, I would personally attend the signing ceremony to indicate my Government’s support for these new initiatives,” President Weah said.
“And that is why I am here today. I am glad to be here because we are here to witness the signing of the formal agreement that should allow him to fulfill his investment goals and objectives in Liberia as he outlined to me during our meeting in Paris. I hope that everything that we talked about is in this document.
My presence here today is in fulfillment of the promise that I made to him, that if his negotiations are successful, and he comes to Liberia to sign the new agreement, I will be there with my team to observe the signing. You all know that I am a man of my word and that I keep my promises. I am “talk and do”. My presence here today is a promise kept.”
President Weah further noted that the agreement contains several benefits that are important to the Liberians to include, the receiving of $55 million United States Dollars to reserve 15 million metric tonnes capacity for ArcelorMittal; and $10 million United States Dollars as a signing bonus, for a total of $65 million United States Dollars.
He further said extension and expansion will result in direct spending of about $200 million United States Dollars per year into the Liberian economy over the next several years.
Su ha an agreement according to President Weah, should result in a significant increase in total government revenue coming from activities resulting from the Amendment.
While lauding Arcelor Mittal for the agreement, the Liberian Leader considers the world steel giant as an important ally in its drive to accelerate the growth of Liberia’s economy under the country’s national development plan, the Pro-Poor Agenda for Prosperity and Development.
However, he said the task to making all this happen is only just now beginning with the signing of the Agreement, stressing that the next step is to obtain the full endorsement of the Cabinet after due consideration, and then to work with the National Legislature for ratification, and after that to implement the agreement.
so that together we move into a future of jobs and prosperity for Liberians.
For his part, ArcelorMittal Chief Executive Officer, Lakshmi Mittal said signing such an agreement with the Government of Liberia will see the company stay in the country for another 25 years, committing to one of the largest and most important mining projects in West Africa.
“This period of negotiation has also enabled us to know each other better, deepening our relationship and I believe building further trust. This is an excellent foundation as we start this new phase that will see us invest an additional US$800 million in the country – taking our total investment to US$2.5 billion,” Mr. Mutual said.
“ArcelorMittal first came to Liberia in 2005. We were the first public international company to enter the country after years of unrest.”
He assured the government of bringing mining back to Liberia, a commitment he hopes to deliver.
While he sees mining operation coming back to Liberia cardinal, Mittal believes it is equally important to firstly invest significantly in the physical and social infrastructure.
Such an investment according to him is critical to help Liberia back on a path of economic development through the construction of roads and railways, helping to set up schools and hospitals – and slowly but surely mining in Liberia came back to life.
He said: “It was a huge milestone when in 2011 we shipped the first iron ore from Liberia in 20 years. I remember that day very clearly.
It was a celebration of more than just the re-start of mining operations In re-establishing mining in the country, we also helped the country rebuild – and being part of that journey has been extremely rewarding for all of us I am sure.”
Moreover, he said ArcelorMittal remained one of Liberia’s largest investors for 16 years, a partnership that demonstrates that the company is stable, reliable, and a strategic investor.
At the same time, Mittal said the expansion of our operations is expected to generate thousands of jobs for the local population during the construction and operating phases.
“More than 2000 jobs will be created during the construction phase and the vast majority of these roles will of course be for Liberian citizens. Once up and running, an additional 1000 jobs for Liberian citizens will be generated,” he assured the government.
Already according to him, since arriving in the country, ArcelorMittal has been helping to educate and train people for the specific skills needed for the mining sector and is now going to expand its Vocational Training Centre so she can be able to enhance the training being provided to the Liberians.
“As Chairman of the company, I am delighted that we can make this contribution to the country and your people. After 16 years here we do see ourselves as a partner for Liberia. We have been through some tough times together. Ebola is the most obvious example. That was a terrible time for your country but you came through it with a remarkable display of strength and fortitude. We stood beside you through that period when many others shut down their operations and took their people out. Tough though those times were I believe that it demonstrated to you that ArcelorMittal is a company that is here in good times and bad,” Mr. Mutual noted.
As the largest foreign investor in Liberia, ArcelorMittal Liberia has invested over $1.7 billion in the country over the past 15 years.
More than 2000 jobs are expected to be created during the construction phase, with Liberians envisaged filling the majority of the roles created.
ArcelorMittal operates a Vocational Training Centre and provides two-year residential certificate training in mechanical and electrical trades.
As part of the expansion, ArcelorMittal Liberia has also launched a training and development program for high potential Liberian employees who will gain on-the-job experience and knowledge in ArcelorMittal Mining operations globally.
The employees will receive advanced training in the fields of mining production and operation optimization, plant maintenance, planning and execution, plant electrical operation systems, and electrical maintenance. Other training areas include plant fitting and heavy-duty mobile equipment maintenance, as well as mine production and operations.
The investment in advanced skills training demonstrates ArcelorMittal Liberia’s commitment to providing employment and professional development opportunities to Liberians.