Thursday, April 16, 2009

Tata Cleared To Bid For Liberian Iron Ore Project

The Liberian government has cleared Tata Steel of financial wrongdoing, clearing the way for the Indian firm to bid for a $1.5 billion iron ore project in the West African country, it said on Thursday.

Last year Liberia disqualified the world's sixth biggest steelmaker from participating in a bidding round for the Western Cluster deposit. It cited "acts of violation" in an earlier bidding process which it said may have been compromised by "external influence or impropriety".

The Justice Ministry said on Thursday that a subsequent investigation had exonerated Tata.

"The government wishes to inform the company that the disqualification placed on it is hereby lifted," it said in a statement.

"Tata Steel is now eligible to fully participate in the re-bidding process for the Western Cluster iron ore deposits."

The bidding round is scheduled to close on May 15 and mining industry officials said 9-10 firms had shown an interest so far.

Since winning post-war polls in 2005 as Africa's first elected female head of state, Liberian President Ellen Johnson-Sirleaf has vowed zero tolerance for corruption as she attempts to rebuild the country after a 1989-2003 civil war.

Her government has looked to foreign investors to boost the reconstruction effort, including exploitation of Liberia's estimated 3.4 billion tonne iron ore reserves -- top in Africa and seventh in the world. Several mining projects in Africa and elsewhere have been delayed or scaled down in the past six months as metals prices have fallen dramatically. Industries that use steel and metals are among the worst hit by the global financial downturn.

In a separate iron ore project, Arcelor Mittal, the world's largest steelmaker, is developing a huge, high-quality iron ore deposit in northwest Liberia with reserves estimated at 500 million tonnes.

Before its civil war, Liberia was the world's fifth largest producer of iron ore.

SourcE: Reuters

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