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Home › Dodgy Deals ›
Dodgy Deal
ArcelorMittal Liberia iron ore mine Liberia

Project – Active

This profile is actively maintained
Profile by:
Julia Hovenier – BankTrack
Contact:

John N Brownell, Green Advocates Liberia, email  

Julia Hovenier, BankTrack, email

Last update: 2024-07-18 00:00:00
Rail owned by ArcelorMittal Liberia. Photo: ArcelorMittal

Project – Active

This profile is actively maintained
Profile by:
Julia Hovenier – BankTrack
Contact:

John N Brownell, Green Advocates Liberia, email  

Julia Hovenier, BankTrack, email

Last update: 2024-07-18 00:00:00
Why this profile?

Why this profile?

Since beginning operations in 2011, ArcelorMittal Liberia (AML) has disrespected the rights of the people and nature affected by its operations. It is currently planning to triple its production in Liberia by the end of 2024. Without in-depth community consultation and remediation for previous activities, this expansion will further exacerbate social conflicts, increase the risk of a new pandemic, and put a critical hotspot of biodiversity in danger. 

What must happen

Before providing the company with debt for its expansion plans, financiers of the ArcelorMittal group must demand from the company that it does the following in Liberia: 

  1. Improves its housing and working conditions for employees, and the living conditions of local communities

  2. Adopts far stronger mitigation practices to ensure that the risk of biodiversity loss, pandemics, and social unrest are effectively managed

  3. Fulfil its social development commitments to the Liberian government

  4. Adequately consult with and compensate the local communities impacted by the extension of the iron ore mine 

Financiers of the ArcelorMittal group must also adopt strong grievance mechanisms,  to ensure that if any of these conditions are not met, there is a channel for affected communities to access remediation.

About
Sectors Mining , Iron and Steel Manufacturing
Location
Status
Planning
Design
Agreement
Construction
Operation
Closure
Decommission
Website http://liberia.arcelormittal.com

ArcelorMittal Liberia (AML) began operations in Liberia in 2011. AML operates  one large open pit iron ore mine on Mount Gangra in Nimba county,  the Buchanan Port Facility on the central coast near Grand Bassa, and a railway connecting the two. The assets are 85% owned by ArcelorMittal, and 15% owned by the Liberian government. In 2022, AML produced 4.4 million tonnes of iron ore, primarily to supply ArcelorMittal's steel plants in Europe, with any additional ores being sold on the European market. AML has announced plans to expand production at its iron ore mine to 15 million tonnes per year, with aims to complete the expansion by the end of 2024. Since 2021, it has been trying to add an amendment to its Mineral Development Agreement (MDA) which governs its mining operations in Liberia to pave the way for this expansion. However the amendment is currently under the legislative ratification process, with opposition from politicians in Liberia and the EU, critical of the social and ecological impact AML has had. 

Impacts

Impact on human rights and communities

Broken promises to local communities The contract AML signed with the Liberian government in 2005 granting the company the right to mine contains several conditions related to social development. It established that AML would build hospitals, schools, and employ local people in its operations. However, as of August 2023, local people living around AMLs operations, the AML Workers’ Union, and Liberian politicians  argue that many of the promises made in the contract have not been fulfilled. In 2019, the Ministry of Mines and Energy wrote to AML criticising its noncompliance with the contract due to the poor status of the hospitals that had been built, and its failure to deliver a school system to the city of Buchanan. 

Poor and unequal treatment of workers The AML Workers’ Union has been very vocal about a number of shortcomings by AML to treat its Liberian workers with respect and dignity. According to the Union, local staff do not receive retirement packages, hazard pay, or sufficient support following workplace injuries, especially compared to the predominantly white expat staff. AML’s CEO in 2020 admitted that the housing for Liberian employees is in much worse disrepair compared to the expat housing. In one case, a former AML employee Stephan Nahn lost his arm in a rock crushing machine, after which he was dismissed and was only compensated with a one time US$9,000 payment. Additionally in 2021, AML was found guilty of unfair labour practices by hiring 546 workers as contractors for a prolonged period of time, and denying them benefits. As a result, the Liberian Ministry ordered them to pay a total of  US$308,000 to the former workers in compensation.


Impact on nature and environment

Water pollution In May 2022, AML was found guilty of dumping raw sewage into the wetland and river basin near its mining operations in Nimba county. As a result, the Environmental Protection Agency of Liberia fined AML US$110,000 for breaching several water and nature protection laws. 

Deforestation of the Nimba nature reserve ArcelorMittal Liberia’s iron ore mine is in the Nimba nature reserve, an area of outstanding biodiversity in West Africa. According to satellite data, since beginning operations in 2011 over 100 square kilometers of tree cover has been lost. That is equivalent to 22% of the forest that existed in 2000, or 18,600 football fields. The clearing of trees to expand the mine, and the rapid population growth surrounding the forest as jobs increase present a significant threat to the biodiversity of the region. 


Impact on pandemics

Heightened risk of a new pandemic Tripling the production of AML’s iron ore mine will require massive amounts of deforestation in the Nimba Mountains, and rapid population growth in an already fragile ecosystem. Together these two factors increase the likelihood of “spillover”, i.e. people coming into contact with wildlife, and contracting a virus that could trigger the next global pandemic. A 2023 Reuters investigation named AML’s iron ore mine as one of the most likely places in the world for this to happen. The Nimba nature reserve is home to a large bat population which is widely considered to be the source of the Ebola epidemic. Expanding operations in the Nimba nature reserve will significantly increase the chances of new pandemics by bringing humans and bats into closer contact.


Other impacts

Corruption AML’s operations are governed by a Mineral Development Agreement (MDA), signed in 2005. According to a 2006 report by Global Witness, the original signing of the agreement was rife with bribery, coercion and corruption. The 2005 MDA was widely regarded by international development experts as tilted in the favour of AML rather than Liberia. As AML and the government of Liberia renegotiate the MDA, EU parliamentarians and Liberian political commentators are concerned that the new iteration will also be the result of intransparent, corrupt processes, and a lack of sustainable development for Liberia. 

Financiers

Expanding the iron ore mine to produce 15 million tonnes per year will require an estimated USD 1.4 billion in capital. ArcelorMittal is expected to finance the project off its own balance sheet. 

Between February 2016 to Feburary 2023, banks have provided at least 21.6 billion in lending to ArcelorMittal through loans and bond underwriting services. See below for details on each bank: 

Institution type
Finance type
Year
Companies

Project sponsor

ArcelorMittal

Luxembourg
Profile
Website
No companies
Governance
Bank policies
Norms & standards
The following bank investment policies apply to ArcelorMittal Liberia iron ore mine :
UniCredit
2016-04-09 00:00:00

Human Rights Commitment

Bank policy
2016-04-09 00:00:00 | UniCredit
2022-12-21 00:00:00

Mining Sector Policy

Bank policy
2022-12-21 00:00:00 | UniCredit
Commerzbank
2022-01-17 00:00:00

Policy framework for handling environmental and social risks in its core business

Bank policy
2022-01-17 00:00:00 | Commerzbank
2022-06-30 00:00:00

Code of conduct

Bank policy
2022-06-30 00:00:00 | Commerzbank
BNP Paribas
2019-03-01 00:00:00

Responsible Business Conduct Policy

Bank policy
2019-03-01 00:00:00 | BNP Paribas
2020-07-14 00:00:00

Anti-corruption policy

Bank policy
2020-07-14 00:00:00
ING
2019-12-19 00:00:00

Stance on human rights

Date listed represents date as accessed on website
Bank policy
2019-12-19 00:00:00 | ING
2019-12-19 00:00:00

Zero tolerance approach to bribery and corruption

Date listed represents date as accessed on website
Bank policy
2019-12-19 00:00:00 | ING
2021-08-19 00:00:00

Biodiversity policy

Date listed represents date as accessed on website
Bank policy
2021-08-19 00:00:00 | ING
2021-06-30 00:00:00

Environmental and social risk framework

Bank policy
2021-06-30 00:00:00 | ING
Société Générale
2022-11-30 00:00:00

Statement on human rights

(Annex 3 of the document)
Bank policy
2022-11-30 00:00:00 | Société Générale
Bank of America
2016-12-31 00:00:00

Developing countries lending criteria

Bank policy
2016-12-31 00:00:00 | Bank of America
JPMorgan Chase
2021-10-08 00:00:00

Environmental and social policy framework

Bank policy
2021-10-08 00:00:00 | JPMorgan Chase
Royal Bank of Canada (RBC)
2020-09-14 00:00:00

Policy guidelines for sensitive sectors and activitities

Bank policy
2020-09-14 00:00:00 | Royal Bank of Canada
2021-02-26 00:00:00

Environmental and social risk management

Date listed represents date as accessed on website
Bank policy
2021-02-26 00:00:00 | Royal Bank of Canada
Sumitomo Mitsui Financial Group
2021-01-14 00:00:00

Management of environmental risks

Date listed represents date as accessed on website
Bank policy
2021-01-14 00:00:00 | Sumitomo Mitsui Financial Group
2022-09-28 00:00:00

Group Environmental and Social Framework

Bank policy
2022-09-28 00:00:00 | SMBC
Banco Santander
2020-07-20 00:00:00

Human rights policy

Bank policy
2020-07-20 00:00:00 | Banco Santander
2020-01-21 00:00:00

Mining & metals sector policy

Bank policy
2020-01-21 00:00:00 | Banco Santander
2023-03-03 00:00:00

Responsible Banking and Sustainability policy

Bank policy
2023-03-03 00:00:00 | Banco Santander
Mizuho Financial Group
2021-02-25 00:00:00

Biodiversity policy

Date listed represents date as accessed on website
Bank policy
2021-02-25 00:00:00 | Mizuho Financial Group
Intesa Sanpaolo
2017-12-01 00:00:00

Principles on Human Rights

Bank policy
2017-12-01 00:00:00 | Intesa Sanpaolo
Goldman Sachs
2022-01-25 00:00:00

Sector Guidelines: General Industries, Agriculture/Soft Commodities, Metals & Mining, Oil & Gas, Power Generation

Date listed represents date as accessed on website
Bank policy
2022-01-25 00:00:00 | Goldman Sachs
2022-03-30 00:00:00

Corporate Social Responsibility Policy

Bank policy
2022-03-30 00:00:00 | Goldman Sachs

Applicable norms and standards

Alliance for responsible mining
IFC Performance Standard 3: Resource Efficiency and Pollution Prevention
ILO Safety and health in the iron and steel industry
International Council on Mining and Minerals (ICMM)- 10 Principles
News
BankTrack
Partners
Blog
External
Blog
BankTrack news BankTrack blog Partner news Partner blog

Frontline communities urge investors not to buy new ArcelorMittal bonds due to human rights, environmental and climate concerns

2024-12-16 | BankTrack, Fair Steel Coalition
BankTrack news BankTrack blog Partner news Partner blog

Liberia: Aggrieved Communities of Nimba, Bong, and Grand Bassa Present Symbolic Black-Smoked Olympic Torch to ArcelorMittal in Yekepa

2024-08-09
Blog
BankTrack news BankTrack blog Partner news Partner blog

Banks fail to substantially respond to communities impacted by ArcelorMittal on climate and human rights concerns

2024-07-18 | BankTrack, Fair Steel Coalition, Reclaim Finance, SteelWatch
Blog
BankTrack news BankTrack blog Partner news Partner blog

Banks fall for ArcelorMittal’s shiny claims and finance its dirty flames

Don’t be fooled by ArcelorMittal's “low carbon” sponsorship of the Olympic Games
2024-05-08 | Julia Hovenier – BankTrack
Blog
BankTrack news BankTrack blog Partner news Partner blog

‘Stop treating us as your sacrifice zone’ Community leaders demand at ING’s annual shareholder meeting

ING finance on steel, gas and coal questioned for its impact on communities
2024-04-24 | Amsterdam | BankTrack
BankTrack news BankTrack blog Partner news Partner blog

ArcelorMittal employee narrowly escapes death in train accident

2023-11-06 | The New Dawn Liberia
BankTrack news BankTrack blog Partner news Partner blog

EPA Fines ArcelorMittal US$110k for Environmental Pollution, Violation of Environmental Laws

2022-05-09 | Front Page Africa Online
BankTrack news BankTrack blog Partner news Partner blog

Liberia to review concession agreement signed with ArcelorMittal

2022-04-22 | Mining Technology
BankTrack news BankTrack blog Partner news Partner blog

As ‘Country Devil’ Disrupts ArcelorMittal Operations In Nimba County, Discussions Underway

2021-10-22 | GNN Liberia
BankTrack news BankTrack blog Partner news Partner blog

The ArcelorMittal scandal, the failure of Weah, and the need for change

2021-09-28 | EU Reporter
BankTrack news BankTrack blog Partner news Partner blog

ArcelorMittal Ordered to Pay US$308K to Dismissed Workers

2021-09-22 | Liberian Daily Observer
BankTrack news BankTrack blog Partner news Partner blog

Liberia: Liberia: Amid Flagrant Violations and Lingering Protests and Threats, ArcelorMittal Insists It’s in Full Compliance with Mineral Development Agreement

2020-08-25 | Front Page Africa
BankTrack news BankTrack blog Partner news Partner blog

Shots fired as Liberia police quell ArcelorMittal mine protest

2014-07-05 | Reuters
Resources
Documents
2024-07-17 00:00:00

Response Tracking – Letter to 20 banks on ArcelorMittal, sent June 10th 2024

NGO document
2024-07-17 00:00:00 | BankTrack
2024-07-09 00:00:00

Letter from Groupe BPCE to BankTrack on ArcelorMittal

Correspondence
2024-07-09 00:00:00 | Groupe BPCE
2023-06-30 00:00:00

ArcelorMittal Half Year Financial Report 2023

Company document
2023-06-30 00:00:00 | ArcelorMittal
2005-08-17 00:00:00

Mineral Development Agreement 2005

Other document
2005-08-17 00:00:00 | The Government of the Republic Liberia
2023-08-01 00:00:00

ArcelorMittal August 2023 ESG report

Company document
2023-08-01 00:00:00 | ArcelorMittal
2023-03-08 00:00:00

ArcelorMittal Annual Report 2022

Annual report
2023-03-08 00:00:00 | ArcelorMittal
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