LIBERIA: The world's largest steel maker Arcelor Mittal is expecting to start production from Liberia by 2010-2011

Record ID: 454726

  • Title: LIBERIA: The world's largest steel maker Arcelor Mittal is expecting to start production from Liberia by 2010-2011
  • Date: 13th April 2007
  • Summary: (AD1) BUCHANAN, LIBERIA (RECENT) (REUTERS) OLD IRON-ORE PLANT TAKEN OVER BY ARCELOR MITTAL
  • Embargoed: 28th April 2007 13:00
  • Keywords:
  • Location: Liberia
  • Country: Liberia
  • Topics: Industry
  • Reuters ID: LVAEFR63WC2AQX5TMXU30NJJVYM7
  • Story Text: The world's largest steel maker Arcelor Mittal is expecting to start production from Liberia by 2010-2011. The company has invested 1 billion US dollars into mining iron ore in the country. Arcelor Mittal - the world's largest steel producer - expects to produce from its new Liberia mine within four years.
    Mittal signed a revised 25-year deal in December with Liberia giving it the right to mine in the northwest of the country.
    Joseph Mathews, Chief Executive of Mittal Steel Liberia, said the project to overhaul an existing mine, port and railway would start this year.
    "That means it's another 20,000 to 25,000 jobs created in the communities and around in Liberia. We don't have the completed engineering study done at this stage but our estimate is to refurbish the existing facilities and to build the new mines, it'll probably be around a billion dollars, a billion US dollars," Mathews said.
    Liberia was ranked the world's fifth biggest producer of iron ore before its 1989-2003 civil war which devastated its infrastructure and decimated the population. When fighting broke out, piles of iron-ore were left to the elements in the port of Buchanan, now home to ship wrecks.
    Liberia's iron ore deposits are currently estimated at 500 million tonnes. Mittal expects to start exploring at full capacity within the next few years.
    "We hope to produce 12 million tonnes at capacity when we get there, and we hope to get there by about 2012, 2013 and as you know the agreement goes on for about 25 years," Mathews continued.
    For Arcelor Mittal, iron-rich West Africa is a region of increased strategic interest, partly because of its geographical location. Last month, the company unveiled a 1.2 billion U.S dollar investment in an iron ore mine in nearby Senegal.
    "We looked at Liberia first, we are also looking similarly in Senegal. And between, the proximity of West Africa plays very well with our plants in Europe, North America and South America so that in itself will be a cornerstone, this will be a hub of our operations," Mathews said.
    President Ellen Johnson-Sirleaf last year re-negotiated an initial Mittal deal signed in 2005 by an un-elected interim government, but it has yet to be ratified by parliament. Johson-Sirleaf has urged legislators to approve it so as not to deter much-needed foreign investment.
    The revised deal ensured the Liberian state would retain control of the port and railway serving the mine, and raised the projected 900 million U.S dollars investment by a further 100 million.
    Unemployment among Liberia's 3.2 million population is around 80 percent, and Mittal's investment is expected to boost the economy.
    "The fact that you have a company as big as this seeing activities around the area, it does create a lot of opportunities for businesses to grow because the people's consumption levels will be increasing, the small traders will begin to have more, see more, their businesses happening, so there's a multiplying effect to that," said Joseph Nyumah Boakai, Liberia's Vice-President .
    The United Nation's special envoy to Liberia, Alan Doss welcomed the revised Mittal deal, saying it would help restore basic infrastructure, but said work needed to be done to attract more foreign investors.
    "The country itself must help create the conditions for productive investment. And that does mean security, but it means other things. It means having a trained labour force, it means dealing with some of the problems with infrastructure and also, I have to emphasise, dealing with the problem of corruption and mismanagement. Nobody wants to come to a county where they think they are going to be liable to arbitrary arrest, to corrupt practices," Doss said.
    Investors and Liberian authorities expressed confidence about prospects for stability and economic growth in Liberia, as one of the world's largest U.N. peacekeeping forces gradually scales back its presence.
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