Monrovia – One of Liberia’s huge investment partners seems to be hitting on another investor for the legal operational ownership of the Port of Buchanan in Grand Bassa County.
ArcelorMittal, which operates in Nimba County and transports its iron ore from the holes in that county to the Port of Buchanan, had written the Minister of State for Presidential Affairs, Mr. Nathaniel McGill, threatening to halt phase two of its investment on suspicion that its concession area at the Port of Buchanan is being encroached on with ‘endorsement’ of the Government of Liberia through a deal with Prista Port.
In a letter to the Minister of State, Nathaniel McGill, the Chief Executive Officer of ArcelorMittal Liberia, Scott Lowe, expressed the company’s “objection to a concession agreement entered into by the National Port of Authority (representing the Government of Liberia) and Prista Port Buchanan LLC on grounds that it includes and overlaps a majority of the current concession area of ArcelorMittal Liberia in Buchanan, Grand Bassa County”.
The letter added: We have been advised that some initial agreement has been executed. Of critical importance is that it awards the iron ore port and most of the associated facilities currently held by ArcelorMittal Liberia to Prista Port.
This action undermines and creates uncertainty regarding the security of tenure of ArcelorMittal Liberia’s business and future investment. Recently, representatives of the Prista Port approached ArcelorMittal in London and asserted that their concession would come into effect and that their company would eventually replace ArcelorMittal Liberia (AML) as the concessionaire. We reject this assertion by Prista Port and maintain that no valid concession can ever be granted that overlaps AML’s concession area.
The importance of this matter is such that ArcelorMittal Liberia cannot proceed with the Phase 2 investment proposal that is currently underway unless and until this situation is corrected. The Company requires absolute certainty that its concessions and permits are in good standing as an essential component of its business case for investment and cannot consider an investment where security of tenure is in dispute or at risk.
The iron ore company requested the Liberian Government to confirm that it has not ratified and would not ratify Prista Port’s concession agreement.
Prista Port’s Respond
Speaking in their defense, Mr. Ivaylo Getsov, Prista Port Buchanan Director wrote Senator Sando D. Johnson, Chairman, Standing Committee for Concessions and Investments and Representative Tibelrosa S. Tarponweh, Chairman, Statutory Committee on Concessions and Investments, to debunk ArcelorMittal’s assertions.
Getsov: “In the social media and in a recent article in FrontPageAfrica, we saw a letter from an ArcelorMittal Chief Executive Officer – Mr. Lowe, that contained misleading information and erroneous references to an exchange between Prista and ArcelorMittal, which presumably had taken place in London.
“On the December 5, 2019, during the UK-Liberia High Level Briefing in London, we met with Mr. Scott Lowe from ArcelorMittal in the presence of our Lawyers – Omnia Strategy. During this meeting we expressed our readiness to cooperate with ArcelorMittal in respect of their plans for expansion of their operations.
“This is why it is quite surprising that in his letter, Mr. Lowe refers to an alleged statement about “replacement of the concessionaire” which is groundless. Our concession in no manner infringes upon ArcelorMittal’s Mineral Development Agreement (MDA) dated August 17, 2005.”
The Prista Port Director said he felt compelled to clarify to present the facts and assure the lawmakers and all parties concerned that their Concession for the Port of Buchanan is in full compliance with Liberian and International law.
He further stated that according to Article IV, Section 1, of the iron ore company’s mineral development agreement (MDA), “ArcelorMittal is granted by the Government of Liberia with the following rights: ‘By this Agreement and subject to its terms and conditions, the GOVERNMENT hereby grants to the CONCESSIONAIRE the exclusive right and license to conduct Exploration, Development, Production and marketing of iron Ore and associated Minerals and products, and rehabilitation of the associated infrastructure in the Concession Area.’”
He further added: “Please note that Prista was granted with a Concession for the Port of Buchanan and not an MDA. The allegation about ‘replacement of the concessionaire’ is groundless and never uttered by us or our representatives.”
Getsov went further to inform the two lawmakers that in the Concession Agreement dated August 14, 2019, for the Port of the concession area between Prista Port and the Government, it is clearly stipulated in details. “‘Concession Area’ means the area of the Port of Buchanan to be granted to the Concessionaire, containing minimum 6000 acres land area and 854.5 acres offshore area within the boundaries established in the ‘ACT TO AMEND AN ACT REPEALING AND ADOPTING CHAPTER SIX OF THE PUBLIC AUTHORITIES LAW UNDER THE CAPTION: CREATION OF NATIONAL PORT AUTHORITY SECTION 52’ hereto attached and forming Part I of Appendix 1, which area shall be consumed through the conduct of a Real Property Survey.”
He further stated that in Sector 3.2 ‘Concession Area’, it is stated, “As of the Elective Date, the Concession Area shall be an area of minimum 6000 acres land area and up to the amount of unencumbered land determined by the Real Property Survey as set below and 854.5 acres offshore area located at the Port with the territorial limits described in the “ACT TO AMEND AN ACT REPEALING AND ADOPTING CHAPTER SIX OF THE PUBLIC AUTHORITY LAW UNDER THE CAPTION CREATION OF NATIONAL PORT AUTHORITY SECTION 52” (the “Act”), which is hereto attached as Part I of Appendix I.
“No later than ninety (90) days, following the Elective Date, and prior to the Handover Date, the Concession Entity and the Concessionaire shall conduct a survey to establish the exact amount of unencumbered land belonging to the Concessions Entity (the “Real Property Survey”). Upon completion of the Real Property Survey, its findings shall form the Concession Area and shall be an integral part of this Agreement…”
The Prista Port Buchanan Director, however, noted that the pending Concession Agreement dated August 14, 2019, clearly acknowledges that ArcelorMittal has an ‘ENCUMBRANCE’ on some of the land within the limits of the Port of Buchanan as a result of their MDA. “To further clarify, the Concession Agreement clearly prescribes inter alia that Prista does NOT have exclusive rights on it,” Getsov emphasized.
“Mr. Lowe’s statement about ‘overlapping of the concession area’ does not have legal rounds and cannot be considered as true,” he added.
He further called the attentions of Sen. Johnson and Rep. Tarponweh to note that President George Weah and his government consider the strategic importance of the development of the Port of Buchanan as a “publicly accessible port.”
In his letter dated September 11, 2019, addressed to the Senate, President Weah stated: “The improved capacity and efficiency of the Port of Buchanan is essential in supporting the Government’s long term aim to export iron ore from both Nimba and Guinea”.
He then reminded the lawmakers that Prista Port still awaits the Handbill for the Concession Agreement dated August 14, 2019, to be issued.
“In these hard times for the economy of the Republic of Liberia, the voters are awaiting for real steps by the Government of Liberia and the Legislature, resulting in opening of new jobs, creation of schools, training centers, and overall improvement of the quality of life of the proud citizens of Liberia.”
Prista Port Buchanan is a Liberian business entity, which was established by the European multinational company Prista Oil Holding EAD, in order to facilitate the concluded Concession Agreement with the Government of Liberia for the Port of Buchanan.
By virtue of the Concession Agreement dated 14th August 2019, approved by President Weah on September 12, 2019, and ratified by the Senate with Act No41 on September 30, 2019, Prista is expected to manage the Port of Buchanan for 25 years. They are set to invest a whopping US$277 million in the Liberian economy. Prista’s investments are expected to create jobs for more than 5000 people and they have given guarantee to the Government for 2000 working places by January 2020.