After canceling the contract awarded to Tata Steel and Delta Mining Consolidated, the Liberian government has called on Tata Steel to once again bid for the $1.5-billion Western Cluster iron ore project.

Tata Steel has now received an invitation from the Liberian Government asking it to participate in the bidding process for the Western Cluster iron ore project, a development fits in with Tata Steel's strategy of focusing on raw material security.

The Liberian government had cancelled the contract won by Tata Steel and Delta Mining Consolidated and had debarred both the companies from re-bidding in September citing acts of violation in the bidding held for the mines, which were given provisionally to Delta Mining Consolidated.

Now Tata Steel has been invited by the Liberian government to take part in the bidding process although Delta Mining Consolidated may dispute the Liberian governments ruling of canceling the iron-ore project contract.

International consultancy firm, Deloitte & Touche had given the Liberian government a report that favoured Tata Steel on grounds of the company's financial strength, technical expertise and strong social values and giving the contract to Delta Mining invited criticism from all quarters of the industry.

The Liberian government then barred both companies from entering the re-bidding process saying the original bid may have been influenced by external factors.

Delta Mining Consolidated, a South African mining company, has already lodged a complaint with Liberia's Public Procurement and Concessions Commission saying that the government's decision was based on reports unsupported by any evidence.

The commission ruled the government action was unlawful, but a clause in the tender documents gave the government the power to cancel the bidding process and restart it.

Liberia's Western Cluster iron ore project is expected to yield 5 million tonnes of iron-ore a year each from the Mano River and Bomi deposits and 10 million tonnes a year from the Bea deposit.

The project also has the provision of developing a mine, palletizing plant and infrastructure.

Tata Steel has been looking for raw material resources in America, Africa and Australia and plans to acquire iron-ore mines to ensure that around 50 per cent of the requirement of Corus is met through captive sources.

In order to augment its raw material resources, Tata Steel had acquired five per cent stake in Carborough Downs Coal Project in Australia with an agreement to purchase 20 per cent of the project's annual production and entered into a joint venture with Riversdale Mining in Mozambique for $100 million for a 35-per cent stake.

It has also entered into a 75:25 joint venture with state-run Sodemi of Ivory Coast for exploring and developing Mt Nimba iron ore mine, which has reserves to be estimated over 500 million. (See: Tata Steel looks at mining acquisitions in the US, Africa, Australia: reports) 

The Mt Nimba deposit, spread across three countries -Liberia, Guinea and Ivory Coast - is one of the biggest in the West Africa.