Africa-Press – Liberia. High Power Exploration (HPX), a U.S.-based mineral exploration company, has aggressively pursued access to Liberia’s rail and port infrastructure for the transportation of iron ore from Guinea, despite lacking critical legal agreements in Guinea.
HPX’s Guinean subsidiary, Société des Mines de Fer de Guinée (SMFG), has yet to secure a valid mining license or Mineral Development Agreement (MDA) from the Guinean government, raising concerns over the legitimacy of its demands for Liberian infrastructure access.
Without these crucial legal documents, HPX’s ability to legally mine and export iron ore is in question. This absence puts Liberia at considerable risk—both legally and economically—by engaging with a company that may lack the necessary legal standing in its host country.
HPX’s Promises: Overambitious?
In February, HPX signed a letter of intent with the Liberian government, pledging to finance a multi-billion-dollar “Liberty Corridor” in partnership with Guma Africa Group.
The project proposes a new railway linking northern Liberia to a deepwater port in Buchanan.
However, despite these grandiose plans, HPX is concurrently pushing for access to the existing Yekepa-Buchanan railway, operated by ArcelorMittal, which has already invested over $800 million in rehabilitating the line.
HPX’s intense focus on displacing ArcelorMittal from the railway has raised eyebrows. If HPX is confident in its ability to develop new infrastructure, its insistence on leveraging ArcelorMittal’s existing assets raises doubts about its actual financial and operational capacity.
Some observers suggest that HPX may be seeking shortcuts to bypass the challenges of developing its own infrastructure.
Doubts from Guinea’s Government
A source within Guinea’s Ministry of Mines expressed skepticism about HPX’s ability to secure financing for its proposed projects in both Guinea and Liberia.
The insider revealed that HPX may never receive the necessary MDA from the Guinean government, casting further doubt on the company’s legitimacy.
Additionally, the Guinean government is reportedly planning a new rail line connecting the Nimba mine to the TransGuinean Corridor, which is expected to be completed by 2025. Should this project materialize, HPX’s reliance on Liberia’s rail infrastructure would become unnecessary, potentially undermining the company’s entire strategy for exporting Guinean iron ore through Liberia.
Unratified Agreement and Shady Deals?
HPX’s dealings in Liberia have not been without controversy. The company reportedly paid $34 million to the administration of former President George Weah to secure a framework agreement granting access to Liberia’s railways and ports.
However, this agreement was never ratified by the Liberian Legislature, raising legal concerns. Furthermore, the deal was struck without approval from Guinea, whose resources HPX intends to transport through Liberia.
HPX has since pressured the newly elected administration of President Joseph Nyuma Boakai to implement this unratified agreement and establish a National Railway Authority, offering $25 million to fund its creation.
Critics argue that this aggressive push signals desperation rather than a genuine commitment to Liberia’s infrastructure development, particularly as HPX lacks the legal backing to operate in Guinea.
Calls for Caution
Officials from Guinea’s Ministry of Mines and Geology confirmed that HPX only holds an exploration license, not the required MDA to begin mining. “Any agreements made by HPX without the Guinean government’s approval would be invalid,” said an official, emphasizing that Liberia should tread carefully in its dealings with HPX.
Given these uncertainties, the Liberian government faces a critical decision. Continuing negotiations with HPX without confirming its legal status in Guinea could expose Liberia to significant risks, including potential diplomatic fallout and economic losses.
Experts are urging Liberia to demand that HPX present a valid MDA from Guinea before any further discussions on the use of Liberian infrastructure proceed.
A Time for Due Diligence
As HPX’s operations and intentions come under increasing scrutiny, Liberia must ensure it conducts proper due diligence. With so much at stake, Liberia cannot afford to enter into agreements with a company that may not have the legal foundation to operate.
A cautious approach will protect Liberia’s interests and prevent the country from being entangled in potentially damaging cross-border disputes.
HPX’s Infrastructure Push in Liberia
Meanwhile, HPX continues to negotiate with the Liberian government and GUMA Africa Group on the development of the Liberty Corridor—a proposed multi-user infrastructure corridor connecting Guinea’s Nimba region to Liberia.
The $3 to $5 billion project includes the construction of a new railway and deep-water port, along with upgrades to road networks and telecommunications infrastructure. While HPX promises significant economic benefits, questions about its ability to deliver remain unresolved.
As President Boakai’s administration navigates these negotiations, Liberia must weigh the potential benefits against the risks of partnering with a company that may lack the necessary legal and financial standing.
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