IPNEWS: Nimba Development Company (NDC), one of the most promising investors in the West African sub-basin iron ore sector, is facing delays in its operations in Liberia, largely due to the ongoing interference and conduct of High-Power Exploration (HPX), a rival Guinean mining company.
The stalled investment by NDC has not only disrupted its plans for the development of the Buchanan Yekepa railway and the port of Buchanan, but also denied Liberia substantial job opportunities and millions in revenue.
HPX has vowed it cannot allow Arcelor Mittal who has invested more than 800 million to make the railway operable as an operator a key factor that stalled AML’s 3rd mineral development agreement.
But as our investigation finds, the conduct of HPX has not just affected AML, it has also immensely delayed the resumption of other projects that can deliver hundreds of new good-paying jobs and see millions more invested in the economy.
Background on NDC’s Investments in Liberia
NDC, through its Guinean subsidiary Société de Développement Nimba (SDN), was poised to be a major player in the Guinea-Liberia mining industry. With an exploitation license for the mining of Mount Nimba in Guinea and a 25-year concession, the laid-out plans to develop 55 hectares of land at the Port of Buchanan.
NDC positioned itself to utilize Liberia’s rail and port infrastructure to export iron ore from Guinea.
The project was set to create hundreds of jobs and contribute significantly to Liberia’s economic growth, but has been sadly delayed by HPX’s ongoing opposition to multi-user arrangement.
HPX, which also seeks to export ore from Guinea, insists that ArcelorMittal Liberia cannot remain the operator of Liberia’s Yekepa-Buchanan rail.
This decision by HPX has thrown every possible discussion about third party user into complete deadlock, directly impacting NDC’s progress, hinged on conclusion of negotiations surrounding third-party access to the rail and port infrastructure.
Despite the fact that AML’s concession agreement with the Liberian government has provisions for third-party access, HPX continues to resist any operational role for AML, arguing repeatedly that AML’s involvement would create an unfair monopoly.
Impact on Liberia’s Economy and Jobs
The consequences of HPX’s actions are already being felt now and in years to come.
NDC’s planned to extend the rail from Buchanan into Guinea and transport extracted ore via Liberia and employ Liberians and pay corporate social responsibility to rail communities.
Hundreds of Liberians who were expected to benefit from job creation opportunities from NDC are now left in limbo, as crucial developments on both the rail and port infrastructure are delayed.
Additionally, the HPX blockade has deprived Liberia of much-needed revenue.
According to the terms of Liberia’s agreements with third-party users, the government would have collected million in transit fees and royalties from the increased utilization of the rail and port infrastructure by companies like NDC.
The project would have also spurred economic growth by creating jobs in construction, rail operation, and port activities but all now seem lost to HPX’s unrealistic demands.
NDC’s Position on AML as Rail Operator
Unlike HPX, our investigation found that NDC has no objections to AML operating the Yekepa-Buchanan railway. The company is willing to engage with AML in meaningful discussions, realizing that under existing agreements, AML is legally required to provide access to third parties, as long as it does not interfere with its own operations and the rights of other users.
NDC has expressed willingness to negotiate in good faith with AML and the Liberian government to ensure that the necessary upgrades to the rail and port are made, benefiting all stakeholders.
AML, for its part, has stated that third parties would only need to invest in enhancing the rail’s capacity for their own use, and it would operate the rail at cost, without profit, under the oversight of a joint management committee, an approach that aligns with international industrial standards and provides a transparent and fair model for multi-user access to Liberia’s infrastructure.
Legal Framework Supports NDC’s Investment
Both the 2005 Mineral Development Agreement (MDA) between AML and the Liberian government and subsequent amendments support third-party access to Liberia’s rail and port facilities. Under these agreements, third parties can use any excess capacity in the rail and port infrastructure, provided they contribute to maintenance and enhancement costs. This framework is critical to ensuring Liberia maximizes the economic benefits of its infrastructure while fostering regional cooperation with Guinea.
In fact, the 2019 Implementation Agreement between Liberia and Guinea, which supplements three previous agreements, including a Transit Agreement dating back to 1973, ensures that Guinean companies like NDC can export their minerals through Liberia without discrimination. NDC’s project meets all the legal and procedural requirements under this agreement, having secured both Guinean and Liberian approval for the use of transportation facilities. The only missing piece is HPX’s obstruction.
HPX’s Actions Delaying Broader Economic Growth
While HPX has every right to negotiate for access to Liberia’s rail and port facilities, its insistence over operatorship needlessly delayed NDC’s progress.
AML, NDC, and the Liberian government have shown willingness to engage in discussions to ensure fair access, but HPX’s rigid stance has stalled what should be a collaborative and mutually beneficial arrangement.
The delay in NDC’s project risks setting back Liberia’s broader economic growth. The country stands to gain from increased royalties, infrastructure investments, and job creation, particularly in the rail and port sectors. By blocking AML’s involvement, HPX is not just hampering NDC’s progress—it is also denying the Liberian people the benefits of the investment that have already been delayed for too long.
The Path Forward
For Liberia to realize the full potential of its infrastructure and maximize its revenue and job creation opportunities, it is crucial that all stakeholders—including HPX—work together to implement a multi-user model for the rail and port. The legal framework is in place, and both the Liberian and Guinean governments have expressed support for third-party access to Liberia’s infrastructure. It is now up to HPX to recognize the importance of collaboration and allow AML to continue its role as operator, ensuring that projects like NDC’s can move forward.
Until then, Liberia will continue to miss out on critical opportunities, and the hopes of hundreds of Liberians awaiting jobs in the mining, rail, and port sectors will remain unfulfilled.
