Country in focus
CEO at Newmont. “The mine provides
an underground platform to explore
additional upside potential in adjacent ore
bodies and also includes some of the latest
fit-for-purpose technologies to enhance
safety, productivity and efficiency,” he
adds. Subika Underground features semi-
autonomous loading operations, proximity
detection for vehicles, personnel tracking,
and planned installation of ventilation-on-
demand systems.
In addition to these projects, ASX-listed
Cardinal Resources recently published
a pre-feasibility study for its flagship
Damdini project located in the upper east
region of northern Ghana late last year,
while the company has also reportedly
struck gold at Ndongo, 20km from
Namdini, also in the north.
Although the larger gold mining companies
are driving exploration, and there is
relatively little greenfield exploration
underway in the country at the moment,
Ghana does offer substantial opportunities
for new exploration companies willing to
undertake preliminary drilling programmes.
It is especially in the northern parts of
Ghana where there appears to be potential
for more exploration.
The northern regions are also conducive to
sustainable energy generation, making it a
convenient area for companies exploring
the potential for renewable power facilities.
But exploration companies should be
encouraged to know that besides gold,
Ghana hosts a range of additional minerals
waiting to be developed. Earlier this year,
Sulemanu Koney, the president of Ghana’s
Chamber of Mines, said almost 97% of
mineral extraction in the country is gold,
and there is vast opportunity to diversify
the mineral basket.
Other historical metals in Ghana
include bauxite, diamonds, manganese
and phosphate, and Koney said that the
government’s move to diversification will
focus on clay metals, granites, solar salt
and lithium. IronRidge Resources is doing
exploration for lithium in the southern
region of Ghana. Further lithium deposits
have been identified in the Volta, Western
and Ashanti regions of Ghana.
Risks and challenges
Notwithstanding the alluring conditions for
mining companies in Ghana, the country
does provide a number of challenges,
especially for junior mining companies.
When the mining code was penned,
the government mainly consulted large
companies and the mining code is, as a result,
underlined by a provision that companies
investing more than USD500-million have
negotiation rights over taxes and royalties,
while companies with smaller investments
do not. Act 703 of the mining code dictates
that terms are frozen for 15 years within a
stability agreement, but a company investing
a minimum of USD500-million has the
opportunity to negotiate benefits above what
is currently outlined.
According to Warren Beech, head of
mining and infrastructure at Eversheds
Sutherland, the long timelines involved in
getting a licence issued in Ghana, remain
a constraint on operating in the country.
“Basics like accessibility to documents
and not having working websites make
it extremely difficult for new mining
companies. One still has to collect the
application from the office ‒ it cannot be
done online ‒ and that is a major concern,”
says Beech.
Late last year Kwaku Asomah Cheremeh,
the minister of lands and natural resources
of Ghana, said that strategies were needed
to sustain investment flows into the mining
sector. “We are working to improve the cost
of doing business by improving the time
needed to process mineral rights applications,
including enhancing the mining cadaster
with Australian government support and
improving infrastructure, especially in the area
of road, port and energy,” he said in the run-
up to the Investing in Africa Mining Indaba
2019, held in Cape Town in February.
Beech adds that Ghana has stringent
environmental requirements, so that could be
a challenge. “It is not a bar to doing business,
but one needs to understand that it is a long
and detailed process, and the compliance
requirements are substantial,” says Beech.
Another risk that has become tangible
over the last few years has been safety
and security. Ghana is located in a
neighbourhood where extremist groups
have been active, although we have to
mention that until now, Ghana has not
been adversely affected by targeted attacks
against foreign companies, as has happened
in other West Africa states. But there is a
big presence of expatriate staff in Ghana,
and that increases the security risk.
The social licence to mine is critical in Ghana. One of the biggest companies operating in Ghana,
Newmont, has initiated several community projects.
www.africanmining.co.za
According to Beech, several foreign
companies have had difficulties in
repatriating their money, despite assurances
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