SLEITI's 2021 Workplan in accordance with requirement 1.5 of the EITI Standard
Sierra Leone is endowed with rich natural resources. The mining industry is dominated by large-scale producers of iron ore, diamonds, rutile, and bauxite as well as small-scale and artisanal mining of gold and diamonds. The country possesses one of the largest rutile reserves in the world. Mining has been significant to the economy of Sierra Leone, despite recent decrease in key economic indicator. For example, Mineral exports contributed about 0.7 to the national GDP in 2018, a drop from 2.7% in 2016 and accounts for 64% of total exports in 2018, a drop from 91.1% in 2016.
Sierra Leone’s upstream oil and gas sector is currently in the exploration stage. In the past decade, interest in oil and gas has been high resulting from the announcement of a discovery of commercial hydrocarbons. This has thus sparked off interest among several global oil producers. In recent years, exploration activity has been on the decline but the Petroleum Directorate has intensified its investment drive in 2018.
Transparent management of natural resources remains a national priority. Sierra Leone’s Medium-Term National Development Plan 2019–2023 includes a target to mainstream transparency and accountability practices into the extractive sector in accordance with the EITI Standard. The president of Sierra Leone, his Excellency Julius Maada Bio has made a strong commitment to using the EITI as a tool to bring reforms that will attract much-needed investment in Sierra Leone.
Sierra Leone published its latest EITI report in December 2019. The SLEITI 2017-2018 report reconciled payments made by the extractive companies and revenues received by the government of Sierra Leone in 2017 and 2018. The report covers the mining and the oil and gas sectors in Sierra Leone as well as registers of licenses; exploration, production and exports; beneficial ownership; contract transparency; state participation in the extractive sector; revenue collection and allocation; and social and economic spending. The MSG is currently working on developing the 2019 Report based on the flexible measures introduced by the EITI Board in 2020
The Mines and Mineral Act (MMA, 2009) governs the mining sector, in addtion, the National Minerals Agency Act was established to create the National Minerals Agency to promote the development of the minerals sector. The petroleum sector is governed by the Oil/Gas-Petroleum Exploration and Production Act (2011). The fiscal regimes for the extractive sectors are incorporated in the Income Tax Act (2000) (ITA) and its amendments, as well as the Finance Act (2017). The main fiscal tools in the mining sector are corporate income tax and mineral royalty. The main fiscal instruments in the upstream oil and gas sector are royalty and corporate income tax.
The government of Sierra Leone does not have a contract disclosure policy. Information on companies’ shareholding structures is now available in its on-line Mining Cadastre Administrative System (MCAS). However, both the Extractive Industries Revenue Act and SLEITI Bills have provisions and objectives which are intended to promote contract disclosure. The NMA has disclosed eight (8) mining agreements on their website.
The National Minerals Agency is the principal point of contact for the general public in all matters to do with mineral rights.The types of licenses issued include reconnaissance license, exploration license, small-scale mining license and large-scale mining license.
Sierra Leone has one of the best web-based cadastre systems in West Africa. The Mining Cadastre Administration System (MCAS) provides information on license holders, coordinates, application dates, and duration of licence in support of the NMA in the management of mineral rights. In addition to the MCAS, an online repository also provides information on (license) payments made during the year.
Objectives of beneficial ownership transparency in Sierra Leone
- Due diligence in licensing and preventing conflict of interest
- Preventing transfer mispricing
- Transparency in ownership of extractive assets and rights help by PEPs
- Prevent corruption and illicit financial flows to help maximise revenues from extractives
In 2017, SLEITI with support from Herbert Smith Freehills (HSF) conducted a report that would review the legal framework, and prepare recommendations for Beneficial Ownership Disclosure reform.
Progress on implementing beneficial ownership disclosure
Sierra Leone is collecting beneficial ownership information from the 20 largest extractive taxpayers. In addition, steps are being taken to support and improving the due diligence procedures employed by the National Minerals Agency and the Petroleum Directorate in order to make these government agencies better informed in their dealings with prospective commercial partners, and better equipped to lead to the systematic collection and recording of beneficial ownership data.
Sierra Leone EITI is holding a series of technical workshops to review current legal and institutional framework for beneficial ownership and build the capacity of relevant stakeholders for the implementation of beneficial ownership. Read Sierra Leone's beneficial ownership roadmap below for more information.
Becoming EITI compliant is one of the ways of ensuring greater transparency and improved governance of the sector.We are proud to engage with the EITI process that requires reporting on revenue streams from the extractives sector. The tremendous efforts that have been made by everyone in the production of this [SLEITI] report reflect our shared aspirations for transparency and accountability of the extractives sector, economic growth in Sierra Leone and prosperity for all Sierra Leoneans.
Sierra Leone produces several resources including Iron ore, bauxite, rutile and gold. Iron-ore production has been a key contributor to Sierra Leone‘s GDP growth. However, due to the shut down of iron mins, production of other minerals, including diamond, bauxite and gold, increased. Gold is mostly mined artisanally and presently production comes from alluvial deposits. Diamond is also been mined mainly from alluvial deposits at the Bo, the Kenema, and the Kono districts. In 2018, 2 million metric tons of bauxite were produced (valued at USD 71 m) while 113.6 thousand metric tons of rutile was produced in 2018, value at USD 108 m. The total value of mineral exports has dropped since 2016 from USD 471 million to USD 433.1 million in 2017 and USD 359.0 million in 2018. The drop in iron ore and rutile exports mainly accounted for the decrease in mineral export receipts. The contribution of mineral exports to the country total export has also seen a decline since 2015 from 95% to 65% in 2018.
The upstream oil and gas activity is in the exploration phase occurring off shore and parceled into 14 blocks.
The 2018 report shows that Sierra Leone received just over USD 29 million (22 million in 2017 and 26 million in 2016) in revenue from its extractive industry operations. 100% of these revenues came from the mining sector.The oil and gas sector was not active in the fiscal year 2017/2018. Revenues were mainly collected through mineral royalties and mining licences.
The National Revenue Authority (NRA) is mandated to collection all taxes on mining. In addition, other payments from the mining sector are made to local councils and Chiefdoms, where mining companies are based, to the Ministry of Mines and Mineral Development. In the case of petroleum revenues, payments are made to the Petroleum Directorate (PD).
Funds paid to the NRA and the PD are subsequently transferred to the Consolidated Fund/Treasury, and thereby lose their identity in the National Budget. Moreover, the budget does not show expenditure by geographical locations but rather by line ministry, which means it is difficult to track where money is actually spent on host mining communities. However, specific contributions, such as surface rent by mining companies, are allocated to certain district councils and chiefdoms for social development.
The EITI encourages multi-stakeholder groups to explore innovative approaches to make the EITI more relevant and useful.
Through its Online Repository Sierra Leone has made revenues generated from mining companies accessible to its citizens. It contains all mining licenses and payments, published directly from the mining licensing system at the National Minerals Agency. This portal also includes data on licenses issued by the Forestry Department. It was launched in January 2012 and adopted by SLEITI in early 2014.
The Minerals Cadastre Administration System (MCAS) hosts fiscal information for all the large-scale mining companies. All fiscal terms in MCAS are copied directly from the companies’ Mining Lease Agreements. Information on companies’ shareholding structures is also available in MCAS.
- The communications team at SLEITI worked with a group of blind people to produce the ‘SLEITI Song’.
Sierra Leone became an EITI country in 2008 and achieved EITI Compliance under the old EITI Rules in 2014. On 17 June 2019, Sierra Leone was found to have made meaningful progress in implementing the EITI Standard. See Board decision 2019-46/BM-43. Sierra Leone EITI's objectives is to promote good governance in the management of our natural resources by ensuring transparency and accountability in the collection and utilisation of revenues from the extractive sector. According to the 2020 workplan, the implementation of the activities is increasing transparency in revenues inflow and management, licences/contracts, legal frameworks and extraction to inform appropriate choices of policy actions.
The MSG has recently been focused on making a greater contribution to an informed debate about resource governance. An assessment of the activities to make the best use of the EITI Standard and an initial assessment of Beneficial Ownership have been conducted. Through its Online Repository, hosted by the Revenue Development Foundation, Sierra Leone has made revenues generated from mining companies accessible to its citizens.
In 2011, an MOU was signed between the Government of Sierra Leone, civil society, and the extractive industries to implement the EITI. These three form the Multi-Stakeholders Group and are responsible for developing policies in line with SLEITI's Mandate. The SLETI Secretariat is responsible for coordinating the day-to-day operations of the SLEITI and ensure that the decisions made by the MSG are implemented. The National Coordinator is Head of Secretariat and serves as Secretary to the MSG.
The Multi-Stakeholder Group is working towards the development of a SLEITI Policy and enactment of the SLEITI Bill which aims to remove legal barriers to implementation.
Name of Chairman of MSG:
- Francess Piagie Alghali
Name of National Coordinator:
- Baimba Mohamed Koroma (interim)
- Office of the Vice President
- The Sierra Leone Parliament
- National Revenue Authority
- Min. of Mines & Mineral Resources
- Min. of Finance & Economic Dev.
- Min. of Agri, Forestry & Food Security
- Min. of Local Gov. & Rural Dev.
- Min of Fisheries & Marine Resources
- Local Council Assoc. of Sierra Leone
- Environmental Protection Agency
- Office of National Security
- Audit Service Sierra Leone
- Petroleum Directorate
- Corporate Affairs Commission
Recognising the ongoing challenges associated with the COVID-19 pandemic, the EITI Board agreed the extension of measures to provide flexibility in EITI implementation and reporting.
Flexible EITI reporting MSGs may prepare reports based on information disclosed by government and/or companies, subject to MSG endorsement and providing that the flexible reporting requirements are met.
Sierra Leone is preparing its 2019 report using the flexible reporting approach. The report will provide relevant information on sector developments and industry outlooks in light of Covid-19 and the commodity price downturn. The report will further focus on the impact of Covid 19 on production, export and the oil and gas licensing round of 2020. The report is expected to provide timely information that could inform debate around resource management and help the government’s Economic Sustainability plan in addressing the economic challenge of Covid 19 pandemic.
Sierra Leone's Validation against the Standard was to commence on 1 July 2018, however, Sierra Leone requested for an extension on 30 June 2018. The Board decided on 4 September that Sierra Leone is ineligible for a commencement of Validation extension under Requirement 8.5 of the EITI Standard. Validation began 4 September taking into account progress made up to 4 September 2018. A country visit took place on 5 to 9 November 2018. All meetings took place in Freetown, Sierra Leone.
Sierra Leone's second Validation will commence on 1 October 2021 in accordance to the revised Validation schedule approved by the Board in December 2020 (Decision 2020-92/BC-300).
The SLEITI 2017-2018 report reconciled payments made by the extractive companies and revenues received by the government of Sierra Leone in 2017 and 2018. The report covers the mining and the oil and gas sectors in Sierra Leone as well as registers of licenses; exploration, production and exports; beneficial ownership; contract transparency; state participation in the extractive sector; revenue collection and allocation; and social and economic spending.
On 17 June 2019, Sierra Leone was found to have made meaningful progress in implementing the EITI Standard. See Board decision 2019-46/BM-43
Timeline of Validation and related materials
June 2018: Validation extension request sent from Sierra Leone EITI1 July 2018: First Validation commencement date4 September 2018: The EITI Board agreed that Sierra Leone is ineligible for an extension of the commencement of Validation, Board Decision 2018-484 September 2018: Validation commenced5-9 November 2018: Country visit
This presentation is the SLEITI 2016 report, which reconciled payments made by the extractive companies and revenues received by the government of Sierra Leone in 2016.
The report also covers the overview of the mining/oil and gas sectors in Sierra Leone, registers of licences; exploration, production and exports in the extractive sector; beneficial ownership; contract transparency; state participation in the extractive sector; revenue collection and allocation; social and economic spending; and the outcomes and impact of the EITI in Sierra Leone.
This report is the 2015 SLEITI report, which reconciled payments made by the extractive companies and revenues received by the government of Sierra Leone in 2015.The report also covers the mining/oil and gas sectors in Sierra Leone as well as registers of licences; exploration, production and exports; beneficial ownership; contract transparency; state participation in the extractive sector; revenue collection and allocation; social and economic spending; and the outcomes and impact of the EITI in Sierra Leone.
This is the Sierra Leone EITI 2016 Annual Progress Report (in accordance with Requirements 7.4. and 8.4.) The report assesses progress made by the country against the EITI requirements, and reviews the outcomes and impact of EITI implementation on natural resource governance.