House Approves Ivanhoe/HPX, TotalEnergies, and Controversial Oranto Oil Deals - Critics Oppose
Legislative Approval of Oil and Mining Agreements Sparks Debate in Liberia
The Liberian House of Representatives has passed a series of high-profile oil and mining agreements, including deals with Ivanhoe/HPX, TotalEnergies, and the controversial Oranto Oil. This decision has drawn criticism from some lawmakers who have raised concerns about the rationale and transparency behind the combined vote.
Representative Musa Hassan Bility of Nimba County, a vocal critic, opposed the Oranto Oil component despite supporting the TotalEnergies Bill. He explained that he would have supported the Total Energy Bill if it had been presented separately. However, the inclusion of the Oranto deal in an omnibus bill made it difficult for him to support the entire package. Bility warned that combining less popular bills with widely supported legislation is a common strategy used to secure approval of controversial measures.
He noted that the proponents of the Oranto deal likely anticipated resistance if it were submitted as a stand-alone instrument. Bility expressed concerns over Oranto's approach, stating that the company lacks a clear plan for exploration and its business model appears to be focused on acquiring assets and selling them for profit.
Despite weeks of objections from influential lawmakers, 27 members of the House voted for the passage of the agreements, with four against and one abstention. The approval followed a report from the Joint Committee on Hydrocarbon, Concession and Judiciary, which recommended periodic five-year reviews but otherwise endorsed the deals.
This legislative outcome reflects a deeper political struggle that has been ongoing for months. The controversy began in late October when Cllr. J. Fonati Koffa, the former Speaker, publicly dissected the Oranto contract in a detailed legal analysis. His posts, widely shared on social media, claimed that key provisions violated Liberia's 2019 Petroleum Law, particularly the requirement for a combined 15% Liberian equity stake through citizens and NOCAL.
Koffa's critique challenged the credibility of the administration's negotiation process. His intervention energized other skeptics, including Gbarpolu County Senator Amara Konneh, who had previously questioned Oranto's financial capacity and corporate track record.
Despite these controversies, the House proceeded to pass the instrument and forwarded it to the Liberian Senate for possible concurrence. Atlas/Oranto Petroleum Liberia Limited, a subsidiary of the Nigerian-linked Oranto Petroleum group, signed PSCs for four offshore blocks—LB-15, LB-16, LB-22, and LB-24—which include signature bonuses and commitments to undertake exploration activities.
Background and Controversy
Oranto previously held Liberia oil blocks but transferred them to Chevron without drilling, raising concerns about the company's capacity, tax compliance, and overall track record. Critics have also questioned the transparency and terms of the new agreements. The deal has sparked public debate, with growing calls for greater transparency and assurances that the agreements will deliver meaningful benefits to Liberia.
TotalEnergies Oil Deal
TotalEnergies, a major global energy company headquartered in France, signed four Production Sharing Contracts (PSCs) for offshore exploration blocks LB-6, LB-11, LB-17, and LB-29 in the Liberian Basin. These contracts were awarded under the 2024 Direct Negotiation Licensing Round. The agreements aim to revive exploration activities in Liberia's deepwater basins through seismic surveys and the potential drilling of wells. TotalEnergies brings significant technical expertise and investment strength, marking the first major international upstream engagement in Liberia in more than a decade.
The deal is viewed as a major step toward revitalizing Liberia's dormant oil sector, attracting foreign investment, and strengthening local content participation and environmental safeguards.
The Ivanhoe Deal
Like the Oranto deal, the passage of the Ivanhoe agreement was not without drama. Despite conflicting testimonies by ministries with relevant authorities, the controversial Concession and Access Agreement (CAA) between the Government of Liberia, Société des Mines de Fer de Guinée (SMFG), and Ivanhoe Liberia Limited was ratified by the House of Representatives.
Top United States Congressman John Moolenaar (R-MI), Chairman of the U.S. House Select Committee on the Chinese Communist Party (CCP), raised alarms over the multibillion-dollar rail corridor, cautioning that U.S. government support for the project could "unwittingly strengthen Beijing's global mineral chokehold."
In a letter sent to U.S. Secretary of State Marco Rubio, Moolenaar questioned the State Department's favorable posture toward Ivanhoe Atlantic. He argued that Ivanhoe's ownership structure includes major stakes held by Chinese state-linked companies, posing what he described as "serious geostrategic risks" at a time when Washington is attempting to reduce dependence on Beijing for global minerals.
What’s in the Agreement?
The agreement grants SMFG and Ivanhoe a 25-year concession to transport iron ore from Guinea through Liberia, utilizing existing railway infrastructure and expanding it as needed. The iron ore will be exported via Liberian rail to the Port of Buchanan with the hope of enhancing increased shipping volumes, including upgrades to the Buchanan Commercial Quay.
Excerpt of the agreement: "The financial implications are substantial, with an estimated investment of nearly US$1 billion in infrastructure. Initial payments include a US$1 million fee due shortly after signing, followed by escalating payments over the early years of operation, as well as ongoing royalties based on iron ore tonnage shipped."
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