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Four multinationals bid to reopen Nimba iron ore mines

Four multinational mining companies have submitted bids to reopen the iron ore mines in the Nimba mountains of northern Liberia, which once provided the government with half its revenue, Jonathan Mason, the Minister of Lands Mines and Energies, said on Friday.

A government technical committee would start to review their offers within the next two weeks and the government would eventually enter negotiations on a concession agreement with the preferred bidder, he told reporters at a ceremony to open the sealed bids.

Officials said the government hoped that work on rehabilitating the Nimba mines and the 280 km railway which connects them with the deep water port of Buchanan would begin later this year.

They declined to say how much it would cost to reopen the mines or when iron ore exports were likely to resume.

The mines, which lie close to much larger and still unexploited iron ore reserves in nearby Guinea, have been closed since 1990, shortly after Liberia plunged into a 14-year civil war.

The conflict finally ended in August 2003, but it wrecked the country's economic infrastructure, most of which is now being rebuilt from scratch.

Mason said the four companies whose bids had been cleared by Liberia's transitional government were; Rio Tinto, BHP Billiton, Mittal Steel and Global Infrastructure Holdings.
UK-based Rio Tinto and Australian-based BHP Billiton are two of the world's biggest mining companies.

Billiton had been negotiating with Liberia to reopen the mines since 2000, before its merger with BHP.

Mittal Steel, which is privately owned by Indian millionaires based in London, is one of the world's largest steel producers.

Global Infstructure Holdings is the overseas investment arm of two privately owned Indian steel companies, Ispat and Essar.

The Liberian minister said: “We will make sure that only the best proposal is accepted so that our country's rich iron ore reserves are exploited in such a way that the revenues accrued will not only benefit the country, but also 25% of the profits from the ore will be used for developmental purposes of the existing communities…that is the demand of government”.

The Liberian-American-Minerals Company was originally given a 70-year concession to mine ore in the Nimba Mountains by the Liberian government in 1953. Two years later, a Swedish group joined the consortium and the company was renamed Liberian-American-Swedish Minerals Company - LAMCO.

LAMCO built the railway to Buchanan and worked the mines for over 30 years, but the concession was surrendered during the civil war.

“We were once the world’s largest producer of iron ore and first in Africa and we still have large reserve of ore deposits”, Mason said.

Before the civil war began in 1989, Liberia relied on iron-ore, rubber, timber and diamonds exports, but now only the rubber industry is active. Iron ore alone provided half of all government revenues.

Exports of diamond and timber are still banned under UN Security Council sanctions imposed on Liberia between 2001 and 2003 to deprive former president Charles Taylor of funds to buy arms.

Last July, the government signed an agreement allowing the Spanish oil company Repsol to explore for offshore oil, but exploration drilling has yet to commence.

Officials at the Ministry of Land, Mines and Energy told IRIN in July that exploration studies conducted in Cote d'Ivoire in the late 1990s concluded there was a strong possibility of oil being found in nearby Liberian waters.

"The shores of Maryland County were particularly cited in the Ivorian study that was submitted to former president Charles Taylor, but no action was taken to attract companies to do exploration," one official explained.

This article was produced by IRIN News while it was part of the United Nations Office for the Coordination of Humanitarian Affairs. Please send queries on copyright or liability to the UN. For more information:

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