MONROVIA – In a brewing dispute that has captured international attention, ArcelorMittal, the steel giant, has issued a firm response to the Solway Investment Group’s threat of arbitration regarding a controversial mining deal in Liberia.
The Swiss-based Solway Investment Group (SIG) and its Liberian subsidiary, Solway Mining, are contesting the government’s withdrawal of their exploration license and its covert transfer to ArcelorMittal.
ArcelorMittal, which established a presence in Liberia in 2005, has invested a substantial $2.2 billion over 18 years, revitalizing the nation’s mining sector and creating considerable economic opportunities. However, the British law firm Signature Litigation has challenged the government’s actions, claiming that the transfer of the exploration license to ArcelorMittal amounts to unlawful expropriation.
Solway Mining has demanded that the Liberian government engage in compensation discussions to avoid potential arbitration. Should the matter proceed to arbitration, the mining company could be entitled to as much as $2 billion, equivalent to the net value of its iron ore mining project in Nimba County.
The dispute stems from the discovery of at least 1.4 billion tons of iron ore in the concession, previously unknown to Solway Mining. Moreover, the license and its assets were reportedly sold with the involvement of a former local Solway manager who negotiated the deal without informing SIG’s head office. The assets were transferred to ArcelorMittal in August, leading to the steel giant’s infusion of $50 million into the country’s coffers.
Signature Litigation lawyers, representing Solway Mining, argue that the transaction violates Liberia’s Investment Act, which explicitly prohibits government nationalization or expropriation of enterprises without appropriate compensation based on international market asset values.
Solway Investment Group addressed a letter to President Weah and several of his advisers, highlighting what Signature Litigation lawyers Ioannis Alexopoulos and Bernhard Maier consider to be wrongdoing in the matter. Solway has expressed its preference for an amicable solution before resorting to arbitration, setting a deadline of October 16.
The outcome of this case is closely watched by the US administration, as it has the potential to deter foreign investors if a resolution is not reached.
ArcelorMittal, in its response to the brewing dispute, emphasizes that only the Government of Liberia possesses the authority to grant mining licenses and allocate the use of government-owned infrastructure assets. The steel giant has outlined plans to expand its mining and logistics operations in Liberia, with a $1.4 billion investment expected to triple annual iron ore exports to 15 million tons. This expansion project also aims to improve ore quality and create more than 2,000 jobs during the construction phase.
ArcelorMittal’s long-standing history in Liberia demonstrates its commitment to resolving matters related to the Mineral Development Agreement (MDA) with the government and local communities. The company has pledged to operate a multi-user railway and invest further in upgrading rail infrastructure. Liberia’s government retains ownership of the infrastructure and has the final say in its usage.
The outcome of this high-stakes dispute remains uncertain, with the potential to shape the future of mining investments in Liberia and determine whether an amicable resolution can be reached between Solway and the government.
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