Liberian President Joseph Boakai has moved to upend Steel giant ArcelorMittal’s fight to keep hold of a contested lucrative railway as he retains his predecessor’s policy to open the rail line to multiple users.
Boakai has issued Executive Order 136, establishing the National Railway Authority (NRA) to oversee and manage the country’s national rail assets, ensuring the efficient and equitable use of rail infrastructure by all stakeholders, particularly in the mining sector and for the transportation of passengers and goods.
Executive Order No. 112, originally issued on 17 October 2022, has expired without the passage of the National Rail Authority Act by the National Legislature.
In response, the President is taking swift action in extending the Executive Order, enabling the establishment of the NRA to regulate and manage Liberia’s rail infrastructure in accordance with international best practices.
The United States government, which has been advocating for a multi-user system, welcome the President’s decision.
“Fair and well-regulated access to rail infrastructure is crucial for Liberia’s economic growth,” a statement on the US Embassy in Monrovia Facebook page said.
Since the end of Liberia civil war, ArcelorMittal has controlled the railway. The company plans not to relinquish its exclusive use of Liberia’s rail linking its iron ore mine to the port of Buchanan until 2025 despite interest from other miners in neighboring Guinea and US firm High Power Exploration.
This timeframe is intended to accommodate the company’s expansion project. The steelmaker has invested US$500 million, upgrading rail and port facilities as it aims to be the majority user of the infrastructure, it said in a 2023 statement.
“AML’s Phase II project was designed to set up a concentrator facility to upgrade the quality and value of the iron ore in Nimba to make it a premium product that is desired by the steel industry
“ArcelorMittal agree d to expand railway capacity to 30 mtpa within the next three years and will allow other users to temporarily use the excess capacity as the company ramps up its mining operations from 5 mtpa DSO to 15 mtpa Concentrate and subsequently to 30 mtpa Concentrate.”
At end 2024, it will be mining and exporting Liberian iron ore with an investment of about US US$3.0 billion. It is Liberians that the project is hiring, along with all the economic spillovers that communities are benefitting from our investment in Liberia, it said.
The company’s stalled third amendment to its mineral development agreement places the Liberian government as the owner and final authority that determines railway usage.
ArcelorMital’s proposed three-year window to end its absolute control of the railway brings into conflict the Liberian authorities push to strip its monopoly.
Key Provisions of Executive Order No. 136:
- Establishment of the National Railway Authority:
The NRA is tasked with developing policies and governance rules for managing the country’s rail assets, including both above-rail and below-rail infrastructure. - Appointment of Rail Regulators:
The NRA will procure the services of qualified rail regulators to oversee the use, operation, and development of the rail infrastructure, ensuring safe, efficient, and equitable access for eligible users. - Staffing and Leadership:
The NRA will be staffed with key officials, including a Managing Director, Deputy Managing Director for Administration, and Deputy Managing Director for Operations, who will be appointed by the President of Liberia. - Funding through User Fees:
The operations of the NRA will be funded by fees levied against users of Liberia’s national railway assets. - Proposing Legislation:
The NRA will also be responsible for drafting a National Rail Authority Act, which will be submitted to the National Legislature for passage into law. - Dispute Resolution:
Any disputes arising from the implementation of this Executive Order will be resolved through arbitration under the rules of the Liberian Chamber of Commerce and in accordance with Liberian law.
President Boakai reiterated the Government’s commitment to the core principles of fair and well-regulated access to rail infrastructure, promoting development while respecting existing agreements with eligible users.
He pointed out that this extension aligns with the Government’s broader goal of enhancing national rail assets for both economic growth and public benefit.
This Executive Order underscores the Government’s dedication to fostering a robust rail infrastructure that supports Liberia’s growing mining sector, enhances the transportation of goods and passengers, and strengthens the national economy.
