Leone Rock Metal Group (LRMG), formerly Kingho Mining Company, under-reported Iron Ore exported from Sierra Leone in 2021 and 2022, an Extractive Industries Transparency Initiative revealed. While Sierra Leone Customs in 2021 reported 1.69m MT exported by Kingho, Sierra Leone Extractive Industry Transparency Initiative (SLEITI) reported 2.03M and 1.81M by destination customs which is a 17% under declaration of volume. Leone Rock Metal Group sells all its iron ore from Sierra Leone to Treasure Boost Trading in Singapore. Also in 2022, Leone Rock reported 5.40m MT to SL customs, but the actual figure is 6.30m MT. Also, Leone Rock sold iron ore to its sister company, Treasure Boost Trading in Singapore, at an average price of $57 per MT, whereas the market price of FE58 in China never dropped below $83 and averaged $107/MT. Kingho is selling the product in-house at a price of about half of the actual market value.
Investigation revealed that in 2022, Leone Rock should have paid $20.7M in royalty to SL, but paid $8.3 million, due to under declaration of volume and sub-market sale to its sister company.
That at full capacity of 20m MT per year, would equate to a loss of $46 million that SL is cheated of every year.
Further investigation proved that Kingho Group cannot invest in Sierra Leone, as it has been targeted by 47 equity freeze decisions in China since 2018, and more than 200 enforcement actions for unpaid bills.
Several entities of the Group are thus, unable to draw funds and provide support to LRMG in Sierra Leone. Kingho owner, Huo Qinghua, himself has been restricted from high-level consumption on 181 occasions, which prevents him from performing his obligations in Sierra Leone. Kingho has failed mining projects in China, Pakistan, Kazakhstan, Mozambique and Australia, cancelled by governments due to Kingho’s inability to invest.
