BHP Billiton has struck a $3bn deal with the Liberian Government to develop a large-scale iron ore project in the country.

Liberia National Investment Commission chairman Richard Tolbert said the mineral development agreement will allow BHP to continue exploring for iron ore at Goe Fantro, Kintoma, St John River South and the Tolo Range.

The mining giant said the agreement sets out the legal and fiscal framework to develop the leases, including the stabilisation of taxes, duties and other trade terms, according to Reuters.

BHP said in a statement the Liberian leases are all close to the existing 250km-long rail corridor that runs from the Guinean border to the Liberian coast.