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US$50M investment   LRMG Commences Expansion and Rehabilitation of Railway and Pepel Port

US$50M investment   

LRMG Commences Expansion and Rehabilitation of Railway and Pepel Port

By Mohamed Konneh 

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The Leone Rock Metal Group on 5th November 2023 commenced the Expansion and Rehabilitation of the Railway and Pepel Port. The ceremony marking this investment took place at the Pepel sea port, Multi-purpose facility. This expansion is among the single biggest investment by a mining company.

Making his presentation on the expansion, the Chief Technical Officer (CTO) at LRMG Salim Sillah said the current facility is 7.5 to 8 million tons per annual capacity and that upgrade capacity will allow for more shipment and traffic. 

‘The Pepel port current loading capacity is 8 million tons per annum, this will change after the upgrade. The port was built in 1958 and ceased operation in 1985. After the Africa Mineral had left from 2012 to 15 Shandong took over until when the facility was handed over to Kingho Mining Company.   

He said when they took over the entire facility was damaged and was in dire need of repairs.

‘We had to do repairs of the steel pipe, installing the sacrificial anode, installation of cathodic protection. The technique in doing this was expensive but we had to do it. Restoration of concrete breakage was done,’ Mr. Sillah said

The Chinese Ambassador to Sierra Leone Wang Qing making the keynote address thanked the government Sierra Leone for agreeing to sign the rail and port lease with Leone Rock Metal Group.

He said the agreement will create jobs and take a number of people out of poverty.

‘This agreement is a win-win for the government of Sierra Leone, Leone Rock and that the agreement will improve corporation between Sierra Leone and China. 

The Chinese Ambassador said the lease agreement will also improve corporation between the local people and the company.

‘Before the signing of the lease agreement the government of Sierra Leone and Leone Rock Metal Group had a professional discussion leading to what we have today. 

The Chief Executive Officer at Leone Rock Metal Group, Gilbert Zhao in his statement expresses heartfelt gratitude President Julius Maada Bio and the entire government for their unwavering support and trust in the company. 

‘We are honoured by the decision to extend the lease agreement for the railway and port by another 20 years. This renewed partnership is a testament to the confidence placed in us to contribute to the growth and prosperity of this great nation.

I must extend special thanks to the dedicated cabinet ministers who tirelessly negotiated the terms of this agreement. Their unwavering commitment to the best interests of Sierra Leone is truly commendable,’ he said. 

Mr. Gilbert Zhao noted that through their hard work, they have demonstrated a deep sense of patriotism, and it is their collective belief that this partnership will yield significant financial and socioeconomic benefits for this beloved country.

He said the new agreement has several notable provisions that highlight commitment to Sierra Leone's progress and one of the most significant changes is the agreement to pay landowners their surface rent and community development fees directly. 

‘We are proud to announce that we will increase the annual payment from a mere $30,000 USD to $250,000 USD, underscoring our dedication to the communities along the rail line and port chiefdoms. I will take to honour to inform you the first payment will be 7 days after ratification in Parliament hopefully next week,’ he said. 

The CEO said the agreement also offers substantial tax benefits to the government, which will contribute to an increase in GDP and, in turn, help the government meet its national financial commitments.

‘Less than 10 days after signing this landmark agreement, we are here to kickstart the expansion and restoration project, a testament to our unwavering commitment to timely and efficient delivery. Our first order of business is the construction of a 49 MW Power Plant in Tonkolili, with an investment of over $32 million USD. This endeavour will generate 100 new job opportunities during construction and operation. Simultaneously, we will be constructing a 9 MW Power Plant in Pepel Port, with an investment of over $7 million USD and the creation of 60 new job opportunities during construction and operation. As part of our efforts to meet the anticipated high traffic demands for multiuser third-party clients, we will also commence the restoration of the jetty with an investment of $4 million USD. In total, we are looking at an investment of $40-50 million USD, and we are committed to completing these projects within six months from today's commissioning,’ the CEO narrated.

These projects he said are all part of the commitments made during the negotiations, and, as a responsible and reliable company, we stand here today to demonstrate once again that choosing Leone Rock Metal Group was never a mistake. 

The Minister of Mines and Mineral Resource, Julius Mattai in his statement said when Kingho first got the licence he was worried for the company looking at the amount of money they were about to spend in repairs and restoration of the rail and port.

 Mr. Mattai said most importantly, we should be reminded that Kingho Mining Company is not stealing minerals as purported as the ministry has a robust monitoring mechanism including other agencies.

‘We have a duty as government to protect companies that are doing business in the country. The various ministries including finance, local government including the chiefs are all part of the structures to monitor what is happening in the field, Mr. Mattai noted. 

‘This is the best agreement the government has signed with a mining company. The agreement needed support from the locals and we need all of you to do so in the best interest of the country, the Minister said.


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