Minister for Lands and Natural Resources, Samuel Abu Jinapor, has praised the transaction between the Government of Ghana and Barari DV Ltd, a subsidiary of Atlantic Lithium Ltd, as one of the finest mineral resource exploitation deals in Africa and beyond.
The Minister explained that the government made a deliberate choice to treat lithium and other green minerals differently from already mined minerals.
As such, an agreement was reached with enhanced benefits for Ghana.
The Minority in Parliament has raised concerns about the agreement and requested Government to submit the Mining Lease to Parliament for ratification.
They contend the Company intends to commence operation by the first quarter of 2024, when the Lease has not been ratified by Parliament.
However, in a press release issued on Friday 27th October 2023, the Minister discredited the notion that the company would commence operation in the first quarter of next year.
He emphasized that obtaining a mining lease is merely the initial step towards undertaking a mining operation and that submitting the lease to Parliament is part of acquiring all necessary rights and permits essential for commencing operations.
“It is fundamental knowledge that after obtaining a mining lease, there are additional processes involved in securing requisite rights and permits before any actual mining operations can begin,” according to his statement.
These procedures include seeking ratification from Parliament regarding the mining lease agreement alongside acquiring an environmental permit from EPA and an Operating Permit from Minerals Commission.”
“It is trite learning that, after acquiring the mining lease, the company must go through other processes to obtain the requisite rights and permits before mining operations can commence. These include ratification of the mining lease by Parliament, the acquisition of environmental permit from the Environmental Protection Agency (EPA), and the acquisition of an Operating Permit from the Minerals Commission,” the Statement said.
Mr. Jinapor said the Mining Lease granted to the company contains an express provision to the effect that the Lease is subject to Parliamentary approval, in accordance with the Constitution and the mining laws of the country.
According to the Minister, the call by the Minority in Parliament is moot and uncalled for, as Government, at all material times has committed to strict compliance with the Constitution and the laws of the country, including the requirement for Parliamentary ratification.
Touching on the terms of the Lease, Mr. Jinapor said Government took a deliberate decision to negotiate terms that inures to the benefit of the country. He noted that the Ministry sought Cabinet’s approval for a new policy for the exploitation and management of the country’s green minerals.
According to the Minister, the policy approved by Cabinet formed the basis of negotiations with the company, leading to the signing of the Mining Lease, which contains innovative and enhanced provisions that provide additional benefits to the country.
The Statement highlighted some of the innovative provisions as doubling royalties rate from five percent (5%) to ten percent (10%), an increase in the State’s free carried interest from ten percent (10%) to thirteen percent (13%), additional Government participation through the acquisition of shares by the Minerals Income Investment Fund (MIIF), additional Ghanaian participation through listing on the Ghana Stock Exchange, one percent (1%) Growth and Sustainability Levy, one percent (1%) Community Development Fund, the requirement for the company to build a chemical plant or sell their produce to any chemical plant built in Ghana for value addition, and strict adherence to local content and local participation laws.
According to the Statement, these benefits are additional to what the State would have gained if it had followed the terms of the Standard Mining Lease granted to all the other large scale mining companies, and by far better than the terms of leases granted in other jurisdictions for the exploitation of green minerals.
It noted, for example, that countries with large deposits of lithium like Australia, Mali, Democratic Republic of Congo, and Zimbabwe, have royalties rates of not more than six percent (6%), whereas Ghana has been able to agree to an enhanced royalties rate of ten percent (10%).
The Minister said the Lease would be submitted to Parliament for ratification, in accordance with the Constitution.
He welcomed the public interest and intense scrutiny in this particular transaction and other transactions for the exploitation of the mineral resources of the country, noting that it is the best way of ensuring that these resources inure to the benefit of the Ghanaian people.
The Minister assured the general public of the Ministry’s commitment to the efficient, effective and sustainable exploitation and management of the country’s natural resources, in the spirit of transparency, anchored on integrity and utmost good faith, for the benefit of the Ghanaian people.