By Abdul Malik Bangura Esq, former PRO LRMG, former Newspaper Editor
The media recently has been flooded with news regarding battle on the management of our Iron ore shipping port in Pepel and the 192 KM railway leading from the port of Pepel in Kamasondo, Port Loko District to the iron ore mines in Ferengbeya, Tonkolili District. Whilst many colleague journalists have made their contributions on the subject matter, defects in information have made me to take on the debate by making some points very clear. I choose to do this because of posterity. I choose to do this because I know that if there is anyone who can explain this better, then it is I. The reasons being:
(a) I served at Public Relations Officer of Leone Rock Metal Group for two (2) years during the covid 19 until the launch of its optimization plant at the mines in 2022. I saw it all.
(b) Also, my phones have been inundated with calls from Patriotic compatriots who want clarity on the subject matter.
My position thus far is to clarify several misconceptions which the public have been deliberately forced to believe. I do this for the over 5,000 Sierra Leoneans who are currently employed by LRMG in both the railway and port facilities. I do this for their dependents too.
How did the Government own the Port and Rail Facility?
In October 2020, Government of Sierra Leone invoked Section 54 of the then Mines and Minerals Act 2009, to takeover possession of properties owned by another Chinese company called Shandong Iron and Steel Company. Shandong had it license terminated by Government therefore by the provision of Section 54 of the Mines and Minerals Act 2009, government could takeover the immovable properties of Shandong (which included the railway, mines and port facilities) and government is bound by the same section to pay Shandong Steel reasonable compensation.
Take note that in October 2020 the entire world was shut-down due to the COVID 19 outbreak and that investors were leaving countries. This was the time Kingho (now Leone Rock Metal Group) acquired mining license as well as railway and port concession from government. It is worth noting that there was no direct takeover from Shandong Steel to Kingho. It was government which handed over the facility to Kingho (now LRMG) after cancellation of Shandong Steel license.
So what is clear here is that the railway and port was actually constructed by the Chinese and handed over to the Government of Sierra Leone.
Was the Railway and Port in Functional State When LRMG Took-over?
No!
The railway and port had ceased operation closed to five years before Kingho (now LRMG) took over. The company spent over 200 million USD to restore and operate the railway and port since it took over in January 2021 to January 2023. Also in July 2022, the company did submit a 57 million US Dollars Railway and Port Expansion Proposal intended to increase the capacity of the railway and port and to enable multi-user service of same within two years.
After inheriting a defunct railway and port infrastructure, which equipment had been stolen, the company at the time of taken-over (during covid lockdowns), had to airfreight most of the kits needed to restore the facilities. It employed over 380 securities to man the 192 KM rail track. That led to significant decrease in the number of rail clips theft.
What has LRMG and Arise Proposed to Pay to the GoSL as fixed amount?
Arise has proposed to pay GoSL the fix sum of USD 1,100,000 (one million one hundred thousand USD) for a period of 25 years. On the other hand, despite its huge investment into the Port and Rail operation and restoration, LRMG in its lease agreement has proposed to pay GoSL the sum of USD 1,500,000 (one million five hundred thousand US Dollars) with a 5% annual increase every year in respect of the fixed annual rent and same shall be reviewed after every five (5) years throughout its 25 yrs rent. Clearly once can see that Leone Rock Metal Group pays government more that Arise, and their terms are very good for any investment into the country.
For the duration of its agreement, Arise has proposed in its lease that “no taxes (including, but without limitation, income tax, additional profits tax, surtax, minor taxes, profits tax, turnover tax, sales tax, export tax, import tax, value added tax, withholding tax and employment related tax), royalties, duties, excise, charges, levies, fees, dues, contribution, payments or imposition of any kind whatsoever payable to the central, regional or local Governments authorities or agents or to any chiefdom or tribal authority or to any other agency of the Lessor shall apply to the Lessee or any affiliate company or Agent of the Lesee or” the” employees of the Lessee or any affiliate company of the Lessee, either direct or indirect.”
On the other hand, LRMG pays all its taxes to the extent of honouring Payroll Taxes at the applicable rate, Immigration Fees at the applicable rate; and Other minor Taxes, which includes all taxes that are generally applicable to all corporations on a non- discretionary, non-discriminatory basis, and which do not exceed the equivalent of US$50,000 in any financial year.”
Is the Arise Economic Zone and Passenger Train Services being mistaken to their application to manage the iron ore railway and port infrastructure?
Yes!!
What has become very clear is that indeed the economic zone being purported by Arise is not even the same to the lease which is before cabinet. Has anyone seen the Arise lease agreement for the Railway and Port?? The lease agreement makes it clear that the lessor (Arise) want to acquire the approximately 200 km railway from Pepel to Tonkolili (the Railway) and the port transshipment and loading facilities upon which the facilities are situated. Simple and straightforward. This is only the railroad from the port to the mines.
Nothing is acquired from where Leone Rock is operating that stops Arise from expanding if they are truly genuine. Arise never applied for additional areas to expand its operation. They only apply for the 200 KM from the port to the mines. Period. Question one will ask is ‘Where is the Economic zone in a just 200 KM functional railway and port infrastructure?
Infact, what has become clear is that the Arise investment that is launched in Koya is never included in their lease agreement. Koya is not even closer to the 200 KM railway which Arise applied for. This is complete misinformation.
Is the media being fair to LRMG?
I think its very unfair for some of the media to engage in corporate gangsterism war against LRMG. It is very clear that LRMG did invest a lot of money at its own cost to restore and run the railway and port infrastructure after it being in ruin for over 5 years. The company is also very open to multi-user of this facility (which broke the myth of monopoly). Also, LRMG pays more revenue in terms of fixed rents and taxes to government than what Arise proposed. Most importantly, LRMG came into the mining industry of the country and invest millions of dollars during COVID 19 and at the time when President Bio’s government faced complete shutdown from the world. Its also be fair that we know that “a friend in need is a friend indeed.” And to Arise, the lawyers will always say “he who seek equity must himself do equity,” because equity is fairness and justice. Be just to LRMG and allow them to continue operate the railway and port facilities.
I rest my case…
