FrontPageAfrica (Monrovia)

13 May 2014

Liberia: Arcelormittal Sets Record Straight Over Halting of Shipment in Nimba

Company says it informed the Liberia National Police (LNP) who, together with ArcelorMittal Liberia security, intervened through dialogue and non-violent means, bringing the situation to a peaceful ending, with the group leaving the tracks.

Monrovia - On the morning of April 29, 2014 ArcelorMittal Liberia received reports that some persons, identified as Concerned Nimbaians, were sitting and standing on the railway track operated by ArcelorMittal Liberia. We immediately halted all train movement to and from Tokadeh for their safety.

The Company informed the Liberia National Police (LNP) who, together with ArcelorMittal Liberia security, intervened through dialogue and non-violent means, bringing the situation to a peaceful ending, with the group leaving the tracks. Since then, we have engaged in peaceful talks with the group to understand all of their concerns and needs. We will continue to engage the Concerned Nimbaians, and all other civil groups within the affected communities in the Counties where we operate.

ArcelorMittal Liberia remains committed to its corporate responsibilities in Liberia, and all areas in which we operate. The Company has contributed significantly to Liberia's job creation, economy, communities, education, healthcare, and more. Moreover, it will continue to work closely with the affected communities in a socially responsible manner for their sustainable growth and development, as well as Liberia as a whole.

In September 2013, the Liberian government ratified the MDA after carefully reviewing the Company's work and progress. ArcelorMittal Liberia is committed to abiding by the terms of the MDA. The National Bureau of Concessions recently applauded the work being done in Nimba and other Counties where the AML operates, and reiterated the Company's compliance with the MDA. As a key investor in Liberia, we go beyond the MDA, looking for great opportunities for transforming Liberia and the lives of Liberians, and will continue to do so. ArcelorMittal Liberia is one of Liberia's largest contributors to the economy through tax revenues, levies, import duties, permits, royalties, and more. In response to recent media reports and allegations from Concerned Nimbaians, the Company believes it is necessary to make the following clarifications.

'Hospital lacks basic drugs for common Liberia illnesses'

Drugs are available, including drugs that relate to common Liberian illnesses such as typhoid and malaria. Renovations of the once destroyed hospital remains ongoing with recent work completed at the pediatric and maternal wards. Currently our public health team has embarked on a malaria campaign in preparation for the rainy season, and is providing free mosquito nets throughout the concession to employees and community dwellers. We have also embarked on mosquito spraying campaigns throughout the concession areas.

Our hospitals are equipped with the following standards and facilities:

A well-equipped medical laboratory;

X-ray facility;

Two operation theaters;

Outpatient emergency rooms;

Trauma room;

Medical airlifts to other hospitals;

Occupational health, with pre-employment medical checks;

Free public health with medical outreach;

Ministry of Health public health and medical activities;

Inpatient services;

60-bed capacity;

Anti-retroviral treatment, including free AIDS treatment, drugs, and counseling;

Two ambulances

We believe that all employees and community dwellers should have access to quality healthcare and are dedicated to ensuring our hospitals provide the best care. Recent improvements at the hospital also include the improvement of the maternal and pediatric wards since it was some years since the original renovation in 2008, and the construction of an Ebola quarantine center.

'Sediments from the mine are destroying the local communities'

It is true that in the 2012 rainy season there was an uncontrolled discharge of sediments on to some farms. As a responsible mining company, we sympathize with the affected farmers and families. Sediment seepage due to heavy rains is common in tropical zones like Liberia. However, in reaction to the spillages, we paid full compensation, amounting to several hundred thousand US dollars for the damages, and stopped the seepage from reoccurring. Accordingly, we built a sediment dam near Gbapa, which collects all of our runoff water.

The dam causes the sediment to settle, leaving clean water to flow out into the Madayea Creek. The opencast slopes of the mining areas near Zolowee were also stabilized, and re-vegetated to ensure reduced flow of sediment to the lower lying areas. Sediment flows are controlled, and monitored by the Mining and Environmental Teams at the mine. At Tokadeh Mine, we use a Storm Water Management Plan to prevent sediment flows to farms in the surrounding areas.

Designed by specialist engineers and checked for stability under different conditions, the dam's foundation reaches firm rock. It was constructed with specially selected laterite compacted in layers, with said construction overseen by geotechnical engineers from the global consultancy company, AMEC.

There is constant monitoring at the dam to ensure its structural integrity, with weekly surveys by engineering staff from the Projects office to see if there is any settlement of the earth dam. The design consultants are writing a full Operation, Maintenance and Surveillance Manual to guide us after the end of the construction phase.

To ensure the effectiveness of the dam, we take water samples from the spillway and the Madayea Creek downstream from the dam; some are sampled for cleanliness on site while some go to specialist laboratories in UK. Air quality is not monitored at the dam because the water makes the air clean. If there is a danger of dust, we monitor air quality at the mine and in the townships areas.

There have been three sediment allegations - once in Zolowee for the first payment made to 34 farms and a second payment for rice loss at $12,870 made to each. A further 7 sediment claims were added from Gbapa to the second group, totaling an extra $6,100 for these farms, for which we paid compensation. A third claim was from Makinto - for which we paid valid claims of between $42,000 - $57,872, and submitted 42 letters of refusal for those unaffected, which were delivered at a public meeting.

Further allegations by 126 farms for alleged damaged by sediment at Sekimpah were rejected after professional investigation proved otherwise. We are currently investigating another sediment allegation in Zolowee, for which the initial allegations was for uncounted crops, but was later blamed on sediment spillage although the sites are not in a location that could be affected by our work. Senior Environmental officers from our Environmental Department submitted a report to the EPA about these findings.

'We have billboards around the Country flattering ourselves'

We utilize our advertising budgets in a responsible corporate strategy to educate, empower and promote key issues. Last year, our billboards focused on road and rail safety, promoting 'Drive Safely' and 'Trains can kill' campaigns. We also focused on the motorbike market, pushing the message of safe riding. In 2014, we used our advertising budget to promote education and career thinking to children between the ages of 8 and 14. Our billboards are designed to promote development, not to flatter the company.

'We (Concerned Nimbaians) will totally obstruct ArcelorMittal's operation in two weeks if there is no response or engagement as promised at Duo meeting'

While our external stakeholder engagement policy encourages dialogue with all stakeholders, we do not encourage threats on the operation. We will have a joint meeting with the Nimba Caucus, Nimba local government and the group within the next couple of weeks, as promised to discuss the operation, and their concerns.

'Indian people are running the show when there are qualified Liberians'

While we have reduced our expatriate staff, the current number of expatriates is not exclusively Indians. We have people from Mexico, South Africa, Canada, Burkina Faso, Ivory Coast, Zimbabwe, Australia, Great Britain, Tanzania, Nigeria, Ghana, Botswana and India. ArcelorMittal is a global company operating in 60 countries and diversity is one of our key characteristics.

In all areas where ArcelorMittal operates, there is a variety of nationalities within the operation. In fact Liberia has a higher proportion of local staff than many of our other locations. Within the lobalizatio, Liberian employees can apply for work in Company divisions in other countries. This is the nature of lobalization.

'People are living in containers'

This statement is FALSE! There is no one living in containers; however, we do have prefabricated buildings and sleepers that are characteristic of mining companies all over the world. These sleepers are air-conditioned and comfortable, and they provide short-term accommodation for expatriate contractors who spend relatively short time carrying out their contracts. Sub-contractors, not ArcelorMittal Liberia staff, use these buildings.

ArcelorMittal Liberia, per employment contract, provides housing to all its employees. Since we are still in the process of renovating homes that were destroyed, we provide housing allowances for those employees that are awaiting homes. Those employees use their allowance for their housing. More houses are currently under renovation with a July completion date.

'People are dying at GW Harley hospital because of the rail's proximity to hospital'

This statement is FALSE! The noise from trains is noticeable at the hospital, but it is not sufficient to kill anyone. Our modern locomotives are not as loud as the old LAMCO locomotives. Nevertheless, the EPA formally instructed us to build a sound barrier between the track and the current hospital; however, the county requested that the money for the sound barrier be used for the relocation of the hospital. Our policy requires that such an action be formally communicated, accompanied by a sustainability plan.

'National Bureau of Concession has failed because Ciata Bishop is holding secret meetings with ArcelorMittal'

A five-person delegation from the NBC (National Bureau of Concessions) visited ArcelorMittal Liberia and conducted a tour of the concession and mines. A meeting was held in which they asked questions relating to our compliance to the MDA, the current mining operation, and the upcoming Phase II. The team expressed satisfaction with the progress made so far.

'ArcelorMittal is robbing the people; people are locally exploited'

These allegations are FALSE, as ArcelorMittal has gone beyond the MDA through community-based projects such as VOSIEDA, ARS and RICCE, local scholarships to the NCCC, building and renovation of clinics, community schools, markets, and hand pumps. Additionally we have exceeded all of our Liberian employment targets. We have paid compensations to farmers, with a recent $4.2 million dollars payment made to local farmers in Gbapa and Zolowee.

'People in government are being pulled by their nose and not helping their people'

This allegation is FALSE as our engagement with the government remains open and transparent, through our government affairs department. The government is a shareholder in the ArcelorMittal Liberia operations, and remains objective in its engagements with ArcelorMittal. We are guided by the MDA and are committed to meeting the obligations set forth by this document.

'Name is now ArcelorMittal because ArcelorMittal had eliminated steel component'

ArcelorMittal is currently the world's leading steel and mining company, and the name change is a result of a merger between Arcelor, a Luxembourg based steel company, and Mittal Steel. The name ArcelorMittal represents the merger that took place in 2006.

'3,000 jobs were promised; where are they?'

Currently our workforce stands at 3,480 with 2,000 additional employees expected during Phase II of our operation.

'No smelting plant and ArcelorMittal will just export and create jobs in other countries.'

As the world's leading steel manufacturer, we have steel plants set up at various sites around the world. Operation of a steel plant requires very large amounts of energy, and Liberia does not have the capacity to generate such power. Currently, we are building the concentrator plant in Yekepa, which will also require additional staffing for the Buchanan operation. Together, we will hire an estimated 2,000 employees within the next couple of years.

'Yekepa today is a shell of the old LAMCO. ArcelorMittal has done nothing. There are poorly re-conditioned homes'

After studying the layout of LAMCO's facility, we have noticed that the new township will include many new additions to meet modern standards. All of the homes in Area EA, EB, EU, R, and D had to undergo complete renovation. Our model is now looking at how our employees can go beyond being tenants and becoming owners instead.

Phase I work included renovation to 433 homes in Yekepa; renovation of the Area B and the ArcelorMittal High school, which now accommodates 1200 students; Area C School is currently under renovation. Renovation work was also done at the hospital, Open Door Theater, to allow for cultural activities, the new head office in Yekepa, a clubhouse, and guesthouses. As we look into the new housing developments, additional renovations continue to meet the needs of our employees.

'Scholarships'

As per the MDA, ArcelorMittal Liberia established an Advanced Academic Scholarship Program to the tune of US$ 200,000 per annum for scholarship opportunities so that Liberians can pursue graduate degrees at universities in Ghana, Kenya, Nairobi, South Africa, Australia and China. In 2014, ArcelorMittal Liberia extended the scholarships to undergraduate students majoring in the natural sciences, geology and mining.

Additionally, the Biodiversity Conservation Program (BCP) of the company currently provides full scholarships to 40 students attending the Nimba County Community College. The BCP has also paid for two Liberians to study in Germany and is supporting research by two others studying overseas.

The MDA provides that ArcelorMittal Liberia will provide an aggregate amount of $200,000 per year to fund the Advanced Academic Studies Scholarship Program. However, the scholarship guidelines and procedures revised and approved 15 October 2013, states that 50% of the total number of scholarships awarded in any year will go to candidates living in or originating from the counties where ArcelorMittal Liberia operates (Nimba, Bassa, and Bong), with the remaining 50% going to candidates elsewhere in Liberia. Under the new guidelines, the countries of Ghana, Kenya and South Africa have been selected for students to study in schools like: University of Ghana, Kwame Nkrumah University of Science and Technology (KNUST), Ghana University of Mines, Nairobi University and North West University, South Africa. To date, 13 students are currently studying, including one female. The rest are studying in Kenya, China, Ghana and Australia. Beginning academic year 2014/2015, the program will extend to students who wish to pursue undergraduate degrees in mining, geology and mechanical engineering.

The program has successfully completed two cycles since 2012. Application process for the third cycle of students is ongoing. Successful candidates are expected to begin studies in September 2014. The scholarship program will run in line with the duration of the MDA between ArcelorMittal Liberia and the Government of Liberia.

These 13 students are pursuing Master's degrees in various disciplines at six universities in China, Australia, Kenya and Ghana. More students will receive scholarships in the coming years under the ArcelorMittal Advanced Academic Scholarship Program. Currently, 1,335 students are enrolled at the ArcelorMittal Liberia School System in Yekepa.

16. 'Yekepa Vocational Training Center (VTC)'

Rehabilitation of the Vocational Training Center (VTC) commenced in September 2013, and is near completion. We made excellent progress on refurbishment of the four workshops; administration building; mess hall; teachers' residences; and dorms.

The Company is also in the final stages of purchasing equipment and tooling, and is actively recruiting trainers. When opened, the Center will deliver a three-year technical vocational education program with a comprehensive three step program including theoretical, practical and on the job training. Theoretical training, which is scheduled to begin in July 2014 will cover numeracy training. Practicals will commence in September 2014, and will cover boiler making; welding; mechanical fitting; diesel mechanics; electrical; and instrumentation mechanics. On the job training will be done in the mine, concentrator plant and other related areas. The program is aligned with ArcelorMittal Liberia Phase II operation, ensuring that the students will qualify for work in the Company, upon completion. There will be four intakes over the next three years, with 96 students making the first intake. Recruitment is being done in the communities and Company.

More exciting is the fact that all 96 students will be given full scholarships, including tuition, dorms (in the newly built dormitories), and afforded three meals a day. The facility will be a state of the art facility with top notch modern equipment. Students graduating from the program will qualify for work anywhere in the world. Currently, a recruitment process through internal and external advertisements has begun, with the internal adverts first going out in the Company.

17. 'Employee training and capacity building'

We are glad to inform you that in collaboration with USAID in Monrovia, we are now ready to launch the Adult Literacy and Numeracy Program for our employees who did not get an opportunity to attend formal schooling for one reason or the other.

During 2013 and the first quarter of 2014, 34,020 hours were dedicated towards capacity building of our employees, from technical skills to office and workplace organizational training. Some of the training programs offered and still ongoing to our workforce include Workplace Organization, which includes 5'S', 5'Whys' and the 8 Wastes; Basic and Advanced Microsoft Office Suite (Excel, Word, PowerPoint, etc); various e-Learning programs through the ArcelorMittal University; Senior Leadership Development Program (Performance Management/GEDP & Employee Engagement); and fast tracking Liberians through our Localization and Succession Planning programs.

"We are committed to complying with the MDA but we also believe it is our responsibility to go beyond the MDA to transform Liberia and the lives of Liberians", says Antonio Carlos Maria, CEO.

ArcelorMittal is the world's leading steel and mining company, with a presence in more than 60 countries and an industrial footprint in over 20 countries. Guided by a philosophy to produce safe, sustainable steel, we are the leading supplier of quality steel in the major global steel marketsm including automotive, construction, household appliances and packaging, with world-class research and development and outstanding distribution networks.

Through our core values of sustainability, quality and leadership, we operate responsibly with respect to the health, safety and wellbeing of our employees, contractors and the communities in which we operate. For us, steel is the fabric of life, as it is at the heart of the modern world from railways to cars and washing machines. We are actively researching and producing steel-based technologies and solutions that make many of the products and components we use in our everyday lives more energy-efficient.

We are one of the world's five largest producers of iron ore and metallurgical coal and our mining business is an essential part of our growth strategy. With a geographically diversified portfolio of iron ore and coal assets, we are strategically positioned to serve our network of steel plants and the external global market. While our steel operations are important customers, our supply to the external market is increasing as we grow.

In 2012, ArcelorMittal had revenues of $84.2 billion and crude steel production of 88.2 million tonnes, while iron ore production reached 55.9 million tonnes. ArcelorMittal is listed on the stock exchanges of New York (MT), Amsterdam (MT), Paris (MT), Luxembourg (MT) and on the Spanish stock exchanges of Barcelona, Bilbao, Madrid and Valencia (MTS).

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