Ato Forson Warns Against Mining Firms Renewing Leases Only to Sell Them After Approval | Finance Minister Dr. Ato Forson has raised concerns about mining firms putting pressure on the government to review mining leases and then quickly turn around to sell them to another investor.
The finance minister warned that mining firms will fail to build mutual trust with the government on these developments if they encourage such practices.
The finance minister disclosed this in an interview with Bloomberg News in London.
Dr. Ato Forson emphasised that the government is not directing mining firms on how to use their concessions, but he urged against encouraging such practices, especially in these times. The Minister, for instance, cited Newmont’s decision last year to sell its Akyem Gold Mine Project to the Zijin Mining Group for US$ 1 billion, a month after it secured an extension of that mining lease.
“That was a mine that the lease had expired after 25 years; it expired and we went ahead to renew it for them and they sold it a month after,” the finance minister stated.
Dr. Forson noted that the intention was to lease it for them to aid the extension of their business.
The finance minister was responding to a question about the government’s relationship with these mining firms owed by foreign firms in the country, especially in these times.
The finance minister noted the government has a very good relationship with all the firms, but wants to ensure that the right thing is done.
Gold Fields Lease
On the Goldfields Tarkwa Mine issue, the finance minister noted that the government is looking into the firm’s request and will take a decision on it when the lease expires in 2027.
“We have not come to an agreement with anyone, because the lease is still active as we speak “the finance minister added.
The minister also rejected reports that negotiations with these mining firms and other investors in that sector has been tense and the Government of Ghana is trying to nationalise some of the country’s mineral wealth.
Reviewing the Mining Sector Fiscal Regime
Speaking in the interview with Bloomberg, the finance minister also justified the government’s decision to review the tax regime of the mining firms, especially royalties. The finance minister noted that rising gold prices on the international market make it fair to review these taxes going forward.. He also justified the government’s decision to introduce what they describe as the windfall tax.
“We did push the sliding scale policy to ensure that when gold prices go up, the country benefits”, the Minister added
He noted that “when the price goes up we all benefit, when it goes down, we look at the associated cost as well”.
BoG’s Gold Purchase Programme
Dr. Ato Forson also justified the government’s buy-back policy, arguing that it is part of plans to improve the country’s reserves.
He revealed that the plan going forward is to hold 20%of Ghana’s reserves in gold and the remaining to dollars.
Asked whether he sees that changing, the minister noted that it is part of the plan for now. “We believe that this approach will help put the Bank of Ghana in a strong position to support the currency”, he added
Ato Forson Warns Against Mining Firms Renewing Leases Only to Sell Them After Approval | Source: Joy Business
