I just finished reading an excellent report by Global Witness called “Heavy Mittal” about the original Mittal Steel minderal development agreement signed in 2005. The agreement was signed by former chairman of the National Transitional Government of Liberia, Gyude Bryant. Bryant didn’t technically have the authority to sign the agreement. His job was simply to run the transitional government and prepare for the October 2005 elections.

The original agreement was heavily weighted in favor of Mittal Steel. Bryant or his cronies probably took some kickbacks in exchange for an agreement that helped Lakshmi Mittal and disadvantaged the government. Perhaps the most egregious part of the agreement is the royalty provision. Iron ore is no longer as labor intensive as it used to be. Although jobs will be created, the most benefits to the people of Liberia would be through royalties. But the royalty provision does not set a procedure for determining how the iron ore will be priced. This means that Mittal could sell the iron ore to one of their subsidiaries for like two cents per ton, and then the subsidiary could sell the iron ore at the market value, but the government of Liberia would only get royalties based on the two cents per ton rate. In most mineral development agreements in other countries, the provision says that iron ore should priced at the market rate.

Ellen’s government is re-looking at all concessions agreements signed by Bryant, and the Mittal Steel agreement is being revised. Ellen has signed the new agreement, and the legislature is currently holding hearings before ratification. I hear that civil society has been allowed to provide input into the new agreement, which is an opportunity they didn’t have with the original agreement.