By Alpha Abu
Mines Minister, Musa Timothy Kabba has said that the shipment of 120,000 metric tonnes of iron ore from the port of Pepel to China by Kingho Company was given cabinet approval, after scrutiny by the Ministries of Justice and Finance.
His statement at the weekly government press briefing on Thursday 4th February 2021 came in the wake of concerns raised by an opposition APC Member of Parliament Chernor Maju Bah saying parliament did not approval the shipment of the ore which had been piled up at the site since a previous mining company closed its operations.
The Minister said after the Chinese company’s expression of interest to export the ore, the government took into consideration various issues including the fact that the stockpile of ore was occupying space on the berth that Kingho would use during its operation, having already secured a mining agreement with the government of Sierra Leone that was signed on 21st December 2020.
He said experts were able to determine the ore’s level of moisture content that was 6% more than the standard limit, and there was concern as well about the transportable moisture limit especially after being exposed at the port for a considerable period of time. He said It was also discovered that the aluminium concentration was 5.5% more than the prescribed benchmark which lowered the quality and price of the ore.
According to Kabba the last time ore was exported from Sierra Leone was in the last quarter of 2017 and the present stockpile has since been there at the port.
Kabba said in determining the price of the product, the government followed all the necessary protocols and negotiated a one- off pricing agreement based on “thorough and transparent procedures that included identifying and communicating with the Off –Taker (buyer) in China to ensure there was no transfer -pricing.”
He said government officials were also able to determine that Kingho had no commercial or contractual relationship outside the shipment of the ore and asserted that the agreement was concurred with by stake holding institutions before it was taken to cabinet for approval.
According to the Minister: “from the Advanced Pricing Agreement that has been made public for the first time in the history of mining, the ore will fetch $12M and from which the government stands to get 70percent unlike in the past when only 3% would go into government coffers.
The ship with the first consignment of 40,000 metric tonnes of the ore set sail for China on Wednesday 3rd February 2021 and is expected to dock at a Chinese port in the second week of March.
On another note, a Chinese company that secured a large scale commercial gold mining license from the government of Sierra Leone in 2019 to mine gold in the Nimini Hills in Kono district has officially commissioned its processing plant on Wednesday 3rd February 2021 and has produced the country’s first ever gold bullion, according to the Mines Minister.
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