A scandalous revelation has emerged from a 6-page secret Memorandum of Agreement (MOA) obtained by Verity News, detailing a highly controversial deal involving the transfer of the Putu Iron Ore Mining Concession (PIOM) that was poised to cost Liberia US$2 billion.
The MOA, dated March 2024, outlines an agreement between the Government of Liberia and Pioneer Group LLC (PGL), which has now unravelled amid accusations of corruption and mismanagement.
The MOA, signed by the Minister of Justice, Minister of Mines, former Minister of Finance, and the CEO of Pioneer Group LLC, sought to transfer the PIOM concession from Severstal to PGL. This deal, however, has been marred by significant flaws and resistance from key figures, including Mr. Jeff Blibo, the head of the National Investment Commission (NIC), who refused to endorse it. Blibo’s opposition was driven by concerns over the deal’s unfavorable terms and its potential harm to Liberia’s interests.
Central to the controversy is the role of Madam Mamaka Bility, Minister of State without Portfolio. Bility is accused of orchestrating the deal and applying undue pressure on other officials to approve it.
This is not the first time Bility has been linked to questionable transactions; she was also behind the controversial yellow machine deal that sparked significant controversy.
Critics argue that Bility’s actions in this case amount to influence peddling and a blatant disregard for national interests.
The failed PGL deal, as outlined in the MOA, involved transferring the entire PIOM concession along with the Class “A” Mining License to PGL. In return, PGL promised a staggering US$2 billion investment and a US$600 million payment to the Government of Liberia (GOL) for the concession transfer.
Additionally, PGL was to deposit US$100 million out of US$165 million into an ESCROW account managed in Dubai, UAE, rather than in Liberia.
The MOA stipulated that after the effective date of the Memorandum of Concession Transfer Agreement (MOCTA), PGL would pay the remaining US$500 million to GOL in two equal installments over two years following a two-year moratorium. The balance of US$1.4 billion was to come from mining operations and unspecified “outside sources,” raising further questions about the transparency and feasibility of the deal. Notably, PGL is registered as a limited liability corporation under UAE law, adding another layer of complexity to the deal.
Historical context reveals that Severstal acquired the Putu Mine from Afferro Mining for $122 million in 2012, with an estimated $3.5 billion needed to fully develop the project.
Despite this substantial investment requirement, Severstal continues to hold ownership of PIOM, and any new purchaser must negotiate directly with Severstal.
The deal’s collapse underscores significant governance issues within Liberia’s investment and mining sectors. The accusations against Bility and the resistance from the NIC highlight deep-seated problems in the country’s approach to large-scale investment agreements. The failure of the deal also raises broader concerns about the effectiveness of oversight and the protection of national resources.
As the investigation into the PGL deal progresses, it is imperative for Liberian authorities to address these issues transparently and ensure that future agreements are conducted with the utmost integrity.
The revelations surrounding this deal point to a pressing need for reforms in how Liberia manages its resource investments and deals with potential conflicts of interest among its officials.
The fallout from this failed deal serves as a stark reminder of the critical importance of rigorous scrutiny and accountability in the management of national assets. As Liberia seeks to attract and manage foreign investment, it must prioritize the interests of its citizens and uphold high standards of transparency and governance.
With multiple allegations of ongoing influence peddling and backdoor negotiations involving multimillion-dollar foreign concessions and business deals, is Minister Mamaka Bility overstepping her bounds and usurping the functions of the National Investment Commission (NIC)? The Amended Investment Law of 2010 clearly grants the NIC the authority to attract, promote, facilitate, and coordinate investment-related activities across all sectors of the Liberian economy.
