In 2022, Western Cluster Liberia (WCL) sought to resume operation in the western region of Liberia: Bomi, Grand Cape Mount and Gbarpolu counties. To facilitate its resumption of operation, a memorandum of understanding (MOU) was executed between WCL and the Liberian government, pending the negotiation of an amendment to the mineral development agreement (MDA). The MDA provides for its amendment due to profound change in circumstances.
The amendment considered all the profound changes, which have occurred since the mineral development agreement was signed in August 2011, and one of these changes, among others, is that Vedanta Limited now owns WCL 100%.
According to a press release issued January 30, 2023 and read by Samuel Brown, Head of External Engagement of Western Cluster, “Several changes in circumstances made it necessary to amend the mineral development agreement, and one of these was that Western Clusters were not allowed access to the railway route used by NIOC from Mano River Congo to the Bomi Hills mine and the railway route used by LMC from the Bomi Hills mine to the Freeport, forcing Western Clusters to construct a new railway to transport iron ore produced by it.
“This Memorandum of Understanding (MOU), which is a temporary instrument that does not affect the Mineral Development Agreement, has been misrepresented in the media for various baseless and unfounded reasons,” the press release underscored.
According to the release, “What is important to note is that under no parity of reasoning could WCL resume its operations after several years of suspension without an enabling intermediate agreement with the Liberian Government. The MOU is that enabling intermediate agreement; and pursuant to the MOU, WCL has provided additional monetary contribution to upgrade and maintain the Tubmanburg-to-St. Paul River Bridge road, which was virtually unpassable before. Also pursuant to the MOU, another payment of US$5 million was made for community development for Cape Mount County, Gbarpolu County and Bomi County. And further pursuant to the MOU, the road permit was granted by the Ministry of Public Works and the Class ‘A’ Mining License was granted by the Ministry of Mines and Energy after a second and more contemporary review of the Feasibility Study.
“It should be acknowledged that the Mineral Development Agreement provides for suspension of obligations where there is a force majeure situation. The Ebola Virus outbreak and the Covid-19 pandemic are force majeure situations during which the Liberian Government declared a state of emergency. Those force majeure situations, which made it impossible for WCL to operate, necessitated the suspension of its operations in Liberia.”
The release underscored, “Vedanta Limited and its subsidiary, WCL, are committed to working with the Liberian Government and its people for the mutual benefit of all sides; and we affirm our commitment to work within the framework of the original Mineral Development Agreement, its amendments and any other rules and regulations, which relates to our operations in Liberia. We wish to also assure the Liberian Government and people of our commitment to comply with and abide by all applicable laws, which control or cover our mining operations, especially the Decent Work Act, so that maximum opportunity will be given to Liberians for training and employment.
“Wherever there is any allegation of transgression or violation of any law or regulation, we wish to assure you that we will conduct thorough internal reviews and that appropriate remedial action, where required, will be immediately taken. We wish to assure the Liberian Government and people that we are prepared to institute corrective measures to ensure that the Liberian Government and no person stands at a loss, injury, or any inconvenience by our operations.”