ArcelorMittal CEO Addresses Ongoing Encroachment Issues, Workers Union Concerns, Steel Giant’s Future In Liberia
MONROVIA – Prior to his Liberia assignment, Scott Lowe had an extensive experience in mining working in senior management positions at BHP Billiton and as CEO in several publicly listed exploration and development companies. He holds advanced degrees in Business and Mining; achieved positive outcomes in a number of international locations and complex business and cultural environments.
Interview by Rodney D. Sieh, [email protected]
Lowe has been tasked with leading ArcelorMittal Liberia’s iron ore concession spanning Nimba County, Bong County, and Grand Bassa County. However, since taking over the helm as Chief Executive Officer at ArcelorMittal Liberia, the Australian journeyman, Scott Lowe has had his hands full dealing with a number of complex issues dogging the global steel giant. In this exclusive interview, Mr. Lowe addresses a wide range of issues relating to concerns from the Workers Union over Health and education benefits, hazard pay and recent attempts by two companies to encroach on its concession areas.
FRONTPAGEAFRICA: Over the last few months ArcelorMittal has been in the news for all the wrong reasons, protests, threats of protests and a wave of uncertainty regarding relations between the company and workers union. How much damage would you say has been done and what is Mittal doing to repair the relationship with the union?
SCOTT LOWE: That’s a good question. ArcelorMittal has been here for fourteen years and we’ve had a positive and constructive relationship with the union – that’s not to say there haven’t been differences and these do occur from time to time. Even in the closest of families, there can be differences of opinions but the key thing is how those differences are resolved through mutual respect and solving problems amicably.
Just this week I had a meeting with representatives of the union; there’s issues we are working on resolving right now. So, I’m very confident there will be a positive, long-term relationship with the union, and we will resolve these current differences.
FRONTPAGEAFRICA: Let’s Look at the issue of workers health and welfare and the issue of Stephen Nahn who suffered an accident on the job when his arm got caught in a rock-crushing machine. What has Mittal done to assist him since the accident and what is his status now?
SCOTT LOWE: Firstly, on the general issue of safety, I have worked for so many years in the mining industry and seen vast improvements in safety records – and ArcelorMittal can be very proud of the work that’s been done to improve safety. When I was a young man – in the 1980s, injuries would happen very regularly, thankfully now, they’re very rare. And with a lot of hard work it’s very hard to have such injuries but we can’t take that for granted. It takes a lot of hard-work, it takes constant attention and we want to get to the point where there’s zero injuries – and a lot of hard work’s gone into that. And in the case that you mentioned, where there are serious injuries, which thankfully are
FRONTPAGEAFRICA: So, it’s possible that more could be done to assist Mr. Nahn to at least make him comfortable because his arm was cut off and his source of livelihood is gone.
SCOTT LOWE: I haven’t met him and I wasn’t sure how it was managed at the time but I’m going to look at it right now.
FRONTPAGEAFRICA: Recently, AML objected to the recent concession agreement between the GoL and Prista Port, even threatening not to proceed with the investment unless the prevailing situation improves. What has happened since that initial response? Where are we now?
LOWE: We’re engaging the government quite regularly on a wide range of issues which includes the concession. First of all, we have no objection to economic development that is neighboring to our operation and doesn’t negatively impact our existing business or our exciting plans for the future. So, we have no objections and we welcome that but of course we want to make sure that our concession isn’t impacted in a way which would impede our current operation or have a negative impact on our plans for the future. So, in all of my engagements with the government, I’ve found that there is overwhelming support for that. We haven’t agreed to reduce our concession or to change the terms of our concession, but to the extent that anybody – Prista Port or anybody else agrees with the government to establish a concession outside of ArcelorMittal area, we welcome that, as long as it protects our existing concession and our terms and conditions.
FRONTPAGEAFRICA: Let’s look at the issue of Solway. Mittal has been firm in resisting attempts to allow Solway Mining to encroach on its concession area. How do you see this all playing out?
SCOTT LOWE: We’re continuing discussions with the government on this. The Solway overlap was granted outside of our mining area – it’s not in our mining area but it is within our concession – and we were obviously concerned about that – but there’s ongoing constructive dialogue with the government in relation to the issue.
The key point is that I’m very confident that at the senior level of government, there is support for ArcelorMittal and a recognition that ArcelorMittal has played a very important part in Liberia for the last fourteen years and there is a lot of support, overwhelming support from the highest level of government for ArcelorMittal to continue to play an important role well into the future. As I said, I came to Liberia with the aim of not just operating existing mines, but also making a bigger and brighter future. A fundamental part of that work is the partnership with government – it is absolutely critical.
FRONTPAGEAFRICA: Are you hopeful that this would be resolved?
SCOTT LOWE: Yes, I’m hopeful that it would be resolved. Good faith and discussions with government, I am hopeful of a resolution that all parties are comfortable with.
FRONTPAGEAFRICA: AML has been going back and forth with the workers union over reported refusal to pay hazard to nurses and hospital staff who worked in hazardous conditions treating COVID patients in AML Concession areas. How much of this is fact and how much of it is fiction?
SCOTT LOWE: This is a current issue that we are working with the union on this week – on that very issue.
First, let me say, in relations to Covid 19, I’m really proud of what my team and what I’ve done in response to Covid-19 from the very outset. We’ve introduced a wide range of measures to protect our people, to protect everybody in our concession but also contributed a great deal to the national response. Within our own operation, I’ll give you some examples, we’ve purchased ventilators and oxygen concentrators and had them flown into the country, we’ve boosted our hospital facilities – and renovated those, we’ve double the number of buses. I’m proud to say we’re the first to make masks wearing compulsory in the country.
We did have lockdowns – one in Yekepa and one in Buchanan – and lockdown was voluntary. No one in government asked us to do that. We’d seen the risks and we responded quickly and those lockdowns were very effective. I’m very proud of our response. We know the crisis isn’t over yet – and we’re continuing to work with our partners in the community and government on the response. So, that’s one comment.
In relation to the union’s approach to us for hazard pay for workers, there is a request that we grant hazard pay for the entire workforce. We’re in meaningful discussion with the workforce right now, I can’t go into the specifics but we have made a proposal to the workforce and I’m hopeful that we can reach an agreement on that in the not too distant future.
FRONTPAGEAFRICA: Does AML treat expat staffers different than it does locals? In terms of benefits, salaries and incentives?
SCOTT LOWE: Firstly, 96 percent of our employees are Liberians and 66 percent of senior management are Liberians…. but we do have some expats. In fact, we have fewer expats in Liberia than many other countries that I have had experience with around the world, but because Liberia does not have a large, well-established mining industry, say like Ghana for example – and there are other African countries, that have many, many companies with much larger mining community – and there’s less need for expats. So we do need some expats. I can assure you that pay and conditions for expats are very competitive – and based on international standards, So, expats like me, my pay and remuneration is consistent with international standard. I work 70 percent of my time here and get to see my family, 30 percent of the time. So, these paying conditions are designed to attract
But let me also say that ultimately, we want to reduce dependency on expats and we’re working toward that. With each passing year, we’ve reduced the number of expats that we have and we’ve focused really and strongly on developing local talents to occupy those roles. So, this is part of a journey, there are fewer expats this year than there was last year – and there will be fewer expats next year because we will be replacing those gradually and significantly with local talents. And as far as how expats and locals are treated, it’s all done on industry standards.
FRONTPAGEAFRICA: Let’s look at the issue of education. The union folks contend that AML is in violation of Article XI which requires the concessionaire to provide free primary education in each location. Is it true that AML is not fulfilling its obligation in this area due to the fact that most of the expats do not have kids in Liberia going to school?
SCOTT LOWE: Firstly, education standards have zero to do with expats. Totally unrelated. We have school facilities that we are proud of in Yekepa and more than three hundred graduates from our schools since 2010 and some 30 graduates are coming up in the next graduation. We are very proud of the facilities that we have in Yekepa. It’s true that we do not have schools in Buchanan; because public schools are available there. Nevertheless, we support all of our employees
and we’re allowed will allowance to support the education of their children there. We’re very proud of what we have – and nothing to do with expats, it’s everything to do with building relations with the community and being responsible corporate citizens.
FRONTPAGEAFRICA: Are you content with the conditions of the hospitals in Yekepa & Buchanan? We’re told that there’s not X-Ray machines or morgues. How true is this?
SCOTT LOWE: I’ve taken particular personal interest in the hospitals since I joined ArcelorMittal Liberia. I’ve visited both the Yekepa and Buchanan hospitals and I have allocated additional funds beyond what was budgeted for making improvements – and we have made significant improvements in the last twelve months. Is there room for more further improvements? Definitely. And so there will be more money made available next year to do even better. In summary we’re spending more money now, we will spend more money next year – to build on the improvements we’ve already made.
You asked about equipment, we are currently in the market sourcing for equipment. Equipment does break down from time to time. Our team is out there sourcing right now. But we’re giving it a priority. As I mentioned, I’ve made it a personal priority to oversee the hospital improvement program and I’m happy to say that we have made progress. Do I think we can make more progress? Definitely.
FRONTPAGEAFRICA: In the wake of all that has been unfolding over the past few weeks – from issues with the union to the Prista deal. Is Liberia in danger of losing AML concessions? What would it take to bring some closure to all of this?
SCOTT LOWE: I don’t have any concerns about the long-term future here for ArcelorMittal. I see a very bright future, I’m really optimistic.
Looking back over the last fourteen years, ArcelorMittal has demonstrated its commitment to Liberia and stayed in the country through good times and bad. In tough times when some other companies abandoned the country, ArcelorMittal stayed here. It’s one of the reasons why I was happy to join the company. This is the kind of company that you’re happy to work for, that dedicates itself by committing to a country – and sticks through thick and thin.
Going forward, whenever I interact with the community or with the government regarding the future, I get overwhelming support. It doesn’t mean that there aren’t problems that pop up some times – like the Solway concession that you’ve mentioned. But overall, I am very confident that the government, our stakeholders, the community, and the company want to see the investment going forward. We intend not only to extend the mine life but to build it into something even bigger, that would generate jobs and make an even greater contribution for the Liberian economy. All the senior people in government that I have spoken to understand and agree. Of course, there will be other companies that want to invest in Liberia and we welcome that. But we think that there’s a win-win solution here for ArcelorMittal, for the Liberian government, for the people of Liberia – and for other companies too going forward.
FRONTPAGEAFRICA: Why did Mittal attend a recent meeting at the Ministry of Mines and Energy? Is AML under any kind of pressure to meet the demands of protesters? Was that a factor in Its decision to meet?
SCOTT LOWE: There was some mediation, to address about ten concerns that were raised by the Nimba Education Guide – and we addressed those. We don’t feel like we’re under any pressure, no. We’re transparent and open with any interested groups that have concerns. That doesn’t mean that we’re going to be able to solve every problem or do so as quickly as people would like, but we do prioritize and work through those issues. I think people can see that we’re quite genuine when it comes to hearing the concerns and then prioritizing what we can to address those. We can’t address everything at once but we’re genuine and serious about addressing the concerns of all stakeholders.
FRONTPAGEAFRICA: The workers’ union has been very critical about the lack of retirement packages after employers reach the age of 65. What is the AML policy on this and is it being implemented to the fullest?
SCOTT LOWE: We strive to adhere to local standards. This issue hasn’t been raised with me previously but it is something that I’m aware that people are beginning to ask questions about and we will continue to engage with people. But to answer your question, what is the company’s policy? It’s to be in line with the country’s standards.
FRONTPAGEAFRICA: Let’s look at the issue of living conditions of the union members. Is this a genuine concern?
SCOTT LOWE: Most definitely. We’ve been spending significant amount of money every year on what we call estates or housing and amenities. Are there any problems with maintenance there? Yes, there have been and it is something that we dedicate a considerable amount of funds and labor to addressing. Outside of the production department, the largest number of people we have working for us work in Estates – in maintaining and improving and correcting problems that come up from time to time with facilities. So, yes There’s definitely room for improvements but we dedicate a very large resource for a great number of people and a considerable budget every year to estates and maintenance and I’m confident that we will be able to address those problems as they arise.
FRONTPAGEAFRICA: If you were to go way back in time, prior to when you took over this job, back to the riots of 2014 when striking workers blocked the tracks and destroyed properties to now when things are still going on of that nature. What would you change – in terms of the way things were handled?
SCOTT LOWE: I wasn’t here at the time so I can’t comment on how things would have been handled but in the short time I’ve been here I’ve been greatly encouraged by the willingness of everybody in the government, community and the company to work together, to come up with amicable solutions to problems as they arise.
FRONTPAGEAFRICA: AML recently announced the approval of Phase Two of its mining operations in Liberia. What’s the status of that now?
SCOTT LOWE: Phase II of the project is critical to the company and the country for the future and we are one hundred percent committed to that project. US$1.7 billion was previously spent on that project and then when Ebola came along and iron ore prices dropped it was put on hold. Since then we’ve been working on redesign and improving the project and we’re now looking to recommence construction in the not so distant future. Doing so would mean not only extending the mine life but seeing significant increase in output which would mean more jobs during construction and more jobs during the production phase – we want to provide a 30-year mine life in our Phase II project – it is the cornerstone of our future here in Liberia and we are very serious about taking that project forward.
FRONTPAGEAFRICA: Finally, let’s look at the issue of the Ganta-Yekepa Road. Where is that project now and how far along are we?
SCOTT LOWE: We’ve committed to funding US$40 million for the Ganta-Yekepa Road – it will take a number of years. At least another two years. However, it’s really making progress. I’ve traveled that road during the wet season and I know how tough it can be and I can see why that project is so important. In any project, there’s always a slow start but its starting to pick up speed and we remain committed to the US$40 million contribution to that project. Right now, it’s at 27 percent completion.
FRONTPAGEAFRICA: How would you assess level of achievement of AML during the COVID-19?
SCOTT LOWE: We’ve been achieving high-levels of production during Covid-19. What I’m proud of? Unlike some other companies in the country, we didn’t stand any employees down – and we didn’t reduce anybody’s salary – even the non-essential workers that were not required to come to work were fully paid. We kept their pay at one hundred percent – and we’re very grateful to the workforce who cooperated with us so constructively. We’ve been achieving record levels of production and keeping employment levels at a hundred percent – and of course contributing strongly to the economy. So, I think it is a great success story and its thanks to the cooperation of the workforce and the coordination of the community and stakeholders. At the start of Covid-19 none of us knew how bad it would get – and of course everyone feared the worst – and its just not good luck, I think Liberia as a country responded, they moved quickly compared to other countries.
Back in March I was returning to Liberia from Australia, the Australians were doing nothing. I land in South Africa they were doing nothing, I transited through Ghana and they were doing nothing. When I arrived in Liberia I wasn’t allowed in the airport until I washed my hands and they were asking me ‘where have you been? Have you been to China – and this is very early on and so the people of Liberia, the government of Liberia has done an exceptional job of moving very quickly and let’s hope that the worst of it is over and we must not lose track that it has a second life, maybe it could but we haven’t let our guard down or gotten out of control but Liberia has done well. ArcelorMittal, we’re very proud of the contributions that we’ve made. We’ve bought a large number of ventilators to make sure – and there were very few, if any ventilators in the country at the time. We all hope that the worst is over.
FRONTPAGEAFRICA: If you were to sit down with the union workers, from a humanly perspective, what would you tell them, in the wake of what has been going on and what has been happening over the years?
SCOTT LOWE: I’d say that ArcelorMittal has had a good history in Liberia, there have been problems in the past but those problems have been resolved. There will no doubt be differences in the future but I really admire the way in which the parties have mutually respect and resolve those issues. My main message would be, ArcelorMittal is here for the long-term future. We are committed – our fourteen-year history demonstrates that and we are absolutely committed for the long term in Liberia. There’s tremendous good will on all sides to create that positive future.