Stakeholders from six mining communities as well as in the Western Area have demanded greater transparency in the collection and utilization of mining revenues emanating from their communities. They made this call following the Sierra Leone Extractive Industries Transparency Initiative (SLEITI) 2017-2018 EITI report dissemination and sensitization dubbed, “Maximizing the benefits of mining to local communities”.
In Lunsar where the dissemination started, stakeholders were concerned that their elected representatives hardly inform them of revenues receive on behalf of the community, as well as development activities undertaken out of these revenues. In Kono, Diamond Area Community Development Fund (DACDF) and Surface rent payments stood out clearly among several issues raised. Stakeholders were of the view that payments of Diamond Area Community Development Fund should be made in the name of the beneficiary chiefdoms instead of elected representatives. At the same time, to reconsider how surface rent payment is distributed as the current model makes little provision for land owning families and legal occupiers to get maximum benefit.
Feedback received from stakeholders on contract disclosure throughout the dissemination exercise was appealing. Many who spoke on this issue called on the SLEITI MSG to explain the provisions contain in the contracts entered into by government with mining companies. By so doing, "it will aid understanding of the companies' responsibilities in our communities". Said a resident of Kono.
Being the ninth report since Sierra Leone joined the EITI process in 2008, the 2017-2018 report highlights relevant aspects of the mining and oil and gas sectors, including background information on the extractive industry, institutional setting, legal and fiscal frameworks, revenue streams, company payments, government receipts, and local benefits. The report further presents the results of reconciling company payments and government receipts, as well as the contribution of the extractive sector to the wider economy in the period under review.
The report findings point to several economic data. Total national revenues received in the mining sector amounted to US$40,262,279.43 in 2017 and US$60,457,327.22 in 2018, representing 96.4% and 96.5% of total revenues from the geo extractive sector respectively. The report shows that receipts from the oil and gas sector, particularly the petroleum subsector, amounted to US$1,476,822 in 2017 and US$2,174,455 in 2018. These revenues represented 3.5% and 3.47% of the total revenues from the geo extractive sector. Further, mineral royalties were the highest contributor to total revenues, accounting for US$9,511,773 in 2017 and US$12,632,947 in 2018. Mineral exports accounted for 64.8% of total export earnings.
According to the report, minerals producing companies including Sierra Minerals Holdings, Sierra Rutile Ltd, Koidu Holdings and Sierra Diamonds paid varying amounts for Community Development Fund to the tune of US$1,186,128 in 2018 to assist with the development of mining communities affected by their operations and to promote sustainable development.
Surface rent payments by Koidu Holdings, Sierra Minerals, Sierra Rutile and Dayu Mining amounted to the tune of US$873,252,000 in 2018, as mandatory payment to ensure maximum benefit for community people that were directly affected by mining activities, and to compensate for loss of economic livelihood. Diamond Area Community Development Fund also feature prominently as mandatory payment “to give back some of the money government gets from the sale of diamonds to chiefdoms in diamond mining areas to carry out development projects in their towns and villages”.
With funding from the World Bank and under the guidance of the Office of the Vice President, including the SLEITI Multi-Stakeholder Group, the report was disseminated in Lunsar, Magburaka in the North, Kono, Tongo and Kenema in the East, and Rutile and Bo in the South in order to raise public awareness around revenues derived from the sector and how communities could leverage on linkages associated with mining from the standpoint of sustainable development and economic growth.
The dissemination exercise ended in Freetown with a commitment by government regulatory agencies, including the National Minerals Agency, Environmental Protection Agency, Petroleum Directorate, Ministry of Finance and Ministry of Mines and Mineral Resources to address concerns raised by stakeholders in collaboration with the SLEITI MSG.
