IS ADVOCATE SAM JACKSON A 'HIRED GUN' OR 'MESSIAH'? Jackson Against Western Cluster Deal comes under attack. Both sides or caught between the trenches.

Economist and Advocate Against Western Cluster Deal comes under attack. Is he playing both sides or caught between the trenches. Steel Giant Set to Rescue controversial Ellelnito Deal as Jackson unveils 'smoking gun'

Rodney D. Sieh, rsieh@frontpageafricaonline.com; David Kolleh, david.kolleh@frontpageafricaonline.com, Tom Neyur, tom.neyur@frontpageafricaonline.com 
 

Monrovia -
There appears to be light at the end of the tunnel in a propaganda war-of-words eclipsing the immediate future of Liberia’s rich Western Cluster. FrontPageAfrica has learned that an Indian mining group with strong presence in base metals production has agreed to partner with Israeli firm Elenilto, signaling that the Inter-Ministerial Committee are close to bringing closure to a problematic deal that has over the past few weeks, cast a dark cloud over the future of mining in Liberia.

The Western Cluster Iron Ore deposits comprising several deposits covering about 207.58 square kilometers consists of two formerly mined deposits and one Greenfield deposit. The Mano River Iron Ore deposits, formerly mined by the National Iron Ore Company (NIOC) has a known or proven reserve of about 80 million tons; the western portion of the Bomi Hills Iron Ore deposits, formerly mined by the Liberia Mining Company (LMC), has a known reserve of 50 million tons; and the Bea Mountains Iron Ore deposits, never mined before, has an estimated reserve of over 923 million tons.

Late last year, the United Nations Panel of Experts Report raised concerns about problems associated with the allocation of key mining concessions in Liberia, describing the much-controversial allocation of the ‘Western Cluster to the Israeli firm, Elenilto as problematic. FrontPageAfrica later gathered that within the past few weeks, Elenilto has negotiated with the Government of Liberia (GOL) and portably presented its bank guarantee, acquired a partnership with credible operating partner and has been on a positive track with the GOL. At the time, government sources were tight-lipped in releasing the name of the company coming to Elenito aid. One source did however, reveal that it was the Indian giant, Tata Steel but talks on that end failed to materialized.

Indian firm in partnership talks
Now, FrontPageAfrica has learned that another Indian giant, Vedanta Resources Plc, is in the picture and has agreed to partner with Elenilto.

The expected deal which appears to now have the vote of the inter-ministerial committee could bring relief amid concerns over the manner in which Liberia has been giving away its lucrative minerals for cheap.
Vedanta recently diversified its mining interests through the acquisition of Anglo American’s zinc assets for US$1.388 billion.  Anglo American placed its zinc operations, along with several other interests, up for sale in 2009 as part of its restructuring. Vedanta on the other hand, has been keen to diversify its mining interests into other regions of the world, which this transaction will help facilitate by giving the FTSE 100 constituent a greater presence in Africa and Ireland. Vedanta will fund the transaction from its existing cash resources, which stood at US$7.2 billion at the end of March.

Assets included in the transaction include the Lisheen Mine in Ireland, a 74% stake in Black Mountain Mining, which in turn owns the Black Mountain Mine and Gamsberg Project in South Africa, and the Skorpion Mine in Namibia. “Anglo Zinc is an excellent operational and strategic fit with Vedanta's existing zinc business and will create significant long term value for Vedanta's shareholders,” Vedanta stated
Ironically, Vedanta was one of five companies who previously bid for rights to exploit iron ore at the defunct Bong Mines. The other bidders are BSGR Resources Ltd, China Union Investment Ltd and Beleh Resources Ltd.  Liberia’s  eastern and western ore belts have deposits estimated at 600 million tones.
The news of the Vedanta-Elenilto arrangement comes in the backdrop of flying accusations and counter-accusations about the bidding process.


Jackson raises alarm
Jackson has been adamant in his contentions that the bidding process which awarded Elenilto rights was flawed, alleging that the Israeli firm was legally a company after it was awarded the bid.
Jackson told reporters in Monrovia Wednesday that he was surprised that the Liberian government will even consider a company like Elenilto to be announced the winner of the bid for the Western Cluster, because according to him by December 24, 2008 Elenilto was just being incorporated, following the announcement of the bid by the Liberian Government on the 20th of the same month.

Said Jackson: “This company did not even meet the requirement of exporting iron ore for at least five years and five million tons a year, but they were awarded the concession, that was why I have always maintained that this government set up an independent commission to investigate the issues that I am raising.’’
Jackson said the company came to Liberia initially as a strip company, selling and buying old irons and somersaulted over night to be a multibillion dollar company. ‘‘We as a people need to open our eyes to the reality of the day and let this company go for the good of all Liberians, they’ve got nothing to offer this country.”           

Countering Jackson, lawmakers and supporters of Elenilto, representing  have accused Jackson of fronting for anti-progressive elements concocting diabolical plans to frustrate the Western Cluster Iron Ore Deal that is almost to be consummated by the Liberian government. ‘‘The issue of the Western Cluster is tied to our nerves; hence we will never relent in our sincere effort to fight for the survival of our people, because this is the cardinal reason for which they elected us to intellectually fight for and ably represent their views and aspirations in national government.’’

County lawmakers behind Elenilto
Amid wrangling between the groups, citizens of the western region, comprising Cape Mount, Bomi and Gbarpolu Counties are said to be jittering over delay to conclude the deal since ELENILTO won the bid several months ago. At a news conference Tuesday, the western region legislative caucus said they were constrained to take issue against those “undermining” the company.

Bomi County Senator Richard Devine, speaking after the legislators joint statement, said he received report that the opponents were swaying some members of the inter Ministerial Technical   Committee from concluding with Elenilto. Said Devine: ‘‘If Sam Jackson and supporters are basing their argument on Elenilto not having money to operate the Western Cluster, the question than is who determines one’s ability to do a task than the one that says I do.’’

Devine says the company has so far declared and has provided document to the effect that it has more than US$4 Billion to undertake the contact.  Should Jackson and cliques be the ones to say they do not have money?

Senator Abel Massalley of Grand Cape Mount added that Elenilto has come to provide jobs for thousands of citizens of the western region who have not been able to benefit from employment for many decades. Besides, the company is interested in building a port in Robertsport to make the city accessible to ships, thereby make it modern and industrious, something these decorators do not want. Daniel Nathan of Gbarpolu County who did not attend the joint news conference said he supports Elenilto on the basis that it intends to employ thousands         

Elenilto has pledged to create 5000 direct jobs by the first five-year  when it starts operations full operations in Western Liberia. The company said a further 30,000 to 50,000 indirect jobs will be created. “Each direct job can create 10 indirect jobs which would benefit thousands of Liberians. Those jobs will be a mixture of skilled and unskilled workforces and they will have trigger-down effects on families’ sustainability due to the extended family system”, Amir Nagammy, the Chief Executive Officer of the Company Liberia Office said, shortly after winning the bid last year.

The jobs will reportedly be created at three proposed project sites that include the former Mano River Mines, Bomi Hills and the virgin Bea Mountains particularly in Bomi, Cape Mount and Gbarpolu counties along with Montserrado, where the company’s Liberia office will be based.

The company says the job creation is the bedrock for its projects in Liberia and it will boost the government’s poverty reduction strategy program which considers employment as the engine of national growth and development.

Elenilto is a unit of Engelinvest Group, a leading global real estate developer that projects in India, Vietnam and Russia, and on global Mining, Metals Trading and Finance. It has total projected sales of the group's real estate portfolio of US$6.8 billions. The value of the natural resources controlled by the group is estimated at US$8 billions.

Opponents of the Israeli firm have counter that the company lacks the expertise to be awarded the contract. Lewis Browne, former President Charles Taylor’s Foreign Minister; Taylor’s then Economic Advisor, Sam Jackson along with veteran politician Dr. Togba Nah-Tipoteh are against the company. The three men said to be stalwarts of the opposition Alliance for Peace and Democracy and the Democratic Alliance respectively are against Elenilto on the basis that it lacks the basic expertise for the job.

‘Failed politicians’ assailed
But critics of the attacks against Elenilto have had labeled those vehemently opposing the enactment of Elenilto Mineral and Mining Company into law as ‘failed politicians’. Representative Matthew Darblo of Cape Mount County who read a statement on behalf of the western region legislative caucus as secretary, said Wednesday: “We cannot afford to compromise Elenilto which is investing more than US$4 Billion in favor of DELTA that has claims it has US$2 Billion to invest.

Making specific reference to Dr.Togaba-Nah Tipoteh and Mr. Lewis Browne of the opposition Alliance for Peace and Democracy and the Democratic Alliance respectively, Representative Darblo called on Liberians not to lend credence to “those failures in whose hands Liberia failed as a nation”.

Angrily reacting to the two opposition politicians on Tuesday January 18, Representative Darblo said “their insistence” that the company was scandalous, fraudulent, and deceptive lacks financial and technical capacities to manage the western cluster warranted his response.

The Inter Ministerial Concession Committee comprising the Ministries of Lands, Mines and Energies, Justice, Internal Affairs and the Public Procurement Concession Commission, National Investment Commission, among others, has thus far granted several companies now operating the country concessional rights.   The Cape Mount lawmaker wondered why the politicians have not raised issues against the granting of concessional rights to five companies now operating in Southeastern Liberia from where Tipoteh and Browne hail.     

He noted it was unfortunate that the politicians could be so subjective especially without providing basis of questioning and discrediting the professional works of the Inter Ministerial Concession Committee which vetted the company in accordance with due diligence processes in line with their statutory duty.
Region deserves development
According to the Cape Mount representative, awarding Elenilto the management of the Western Cluster was about the citizens of the entire Western Region and not about individuals like Lewis Browne and Tipoteh whom have only been concerned about their selfish interests in the past.

He said the people of the region deserved to be developed and economically grow as the case of citizens of Bassa, Bong, Nimba and other counties who are benefiting under the coverage areas of Buchanan Renewable, Arcelor Mittal among others. The Ground Cape Mount Lawmaker regrets that Lewis Browne of the Democratic Alliance could continue to politicize the agreement basically because of selfish interest. 
According to the Unity Party Lawmaker, the DA executive was trying to save face for his past failure by fronting for a company that has already failed the vetting process just to buy favor from the region.
Darblo told FPA, Lewis Browne was fronting out of selfish for the Capitol Steel-Holdings, a subsidiary of Shouggang Corporation of China as well as Sociedadade Formento Industrial Private Limited of India as having the expertise to manage the Western Cluster.       

 
Reason for their advocacy for the company’s involvement, the Representative argued, is all because the said politicians are in the pockets of the two companies.

As part of Elenilto winning the bid, it agreed to pay the government of Liberia US$25 million and make an additional US$3.1 million every year as contribution to the community development and additional payment to the government as mineral resource rent tax (surcharge) equal to 21 percent from Elenilto profits.
At the time, Lands, Mines and Energy Minister Eugene Shannon said that though government had given the company provisional rights, the technical committee chose to conduct additional due diligence into their financial status and have communicated to President Ellen Johnson Sirleaf about the additional investigative measures. Elenilto was later requested to submit to the technical committee the list of their financial supporters to make sure that they have the financial capability to do the job. “They have been vacillating. As such, we have given them the option to put in an escrow account US$25 million to guarantee that they have the capability to handle the project,” Shannon said at the time.

Shannon noted at the time that if it is established that Elenilto was not able to deposit the US$25 million in an escrow account and provide a list of viable financiers to undertake the project, then they will have to recommend to the President Johnson Sirleaf that government nullifies the contract.
Four companies made initial submissions to mine the Western Cluster. They included Elenilto Mineral Mining Ltd., Capital Steel, Global from China, Formento Ltd, and Global Steel Holdings.

With so much pressure mounting on the government to bring closure to the Western Cluster debacle, Jackson, who recently stepped down his position as a member of the Board of Directors of the Liberian Petroleum Refining Company(LPRC) has come under fire and appears to be caught between the trenches. Jackson’s backers have hailed him as a messiah for spotting holes in the bidding for the Western Cluster while his critics have taken him to task for being a hired gun spearheading a negative campaign against a firm determined to deliver jobs to the Western belt. Amid the propaganda war-of-words, mineral experts hope that the arrival of Vedanta will tighten the bolts on a deal, locked in controversy for months. In the final analysis, many are hoping that when finalized, the interest of Liberia and those languishing at the bottom of the economic barrel would be served best as post-war Liberia looks to restore its economic sanity.