Mining industry of Ghana
Mining in Ghana is a significant contributor to the nation's economy, accounting for approximately 5% of Ghana's Gross Domestic Product (GDP) and 37% of total exports. Gold dominates the mineral sector, contributing over 90% of total mineral exports.[1][2][3] In 2019, Ghana overtook South Africa to become the largest gold producer in Africa, producing 142.4 metric tonnes of gold that year.[4][5][6][7] Ghana's mining sector produces minerals such as bauxite, manganese, natural gas, petroleum, salt, silver and diamonds.[8][9] In 2020, the country produced approximately 1.16 million metric tons of bauxite, ranking it among Africa's top bauxite exporters.[10][11][12][13] In recent years, Ghana has identified substantial lithium deposits[14][15][16] HistoryMining in Ghana predates colonial times, with evidence showing that gold mining in the region has been carried out for centuries. Indigenous communities mined gold along riverbanks such as the Pra and Ankobra Rivers using rudimentary tools, long before the arrival of Europeans. Gold played a central role in the development of the Ashanti Empire, which traded extensively with North Africa and Europe through trans-Saharan trade routes.[17][18][19] With the arrival of Portuguese explorers in the 15th century, European powers began to recognize the region’s vast gold reserves. By the late 19th century, during British colonial rule, commercial mining operations began to take shape. The establishment of the Gold Coast Colony in 1821 marked the beginning of organized gold mining, primarily in areas such as Obuasi and Tarkwa, which would later emerge as major mining hubs.[20] The Ashanti Goldfields Corporation, established in 1897, became a significant player in the industry and contributed to the Gold Coast's economy. Colonial authorities constructed railways and ports to facilitate the transportation of minerals[21][22] Following Ghana's independence in 1957, the mining industry saw a shift in focus. This led to the establishment of the Ghana State Mining Corporation (GSMC) in 1961, which was later reincorporated as the State Gold Mining Corporation (SGMC) in 1964. The SGMC took over operations of several mines, including those in Obuasi and Tarkwa, aiming to maximize national revenues from gold mining.[23][24] The economic reforms of the 1980s and 1990s under the Structural Adjustment Program initiated a liberalization of the mining sector. This period saw the influx of foreign direct investment, particularly from companies in Canada, Australia, and South Africa. Key legislative reforms, such as the Minerals and Mining Act of 2006, aimed to attract investors and ensure sustainable practices in the sector.[25][26] During this period, large-scale mining projects, such as AngloGold Ashanti's Obuasi mine and Newmont Goldcorp's Ahafo mine, began producing gold. By 2019, Ghana had overtaken South Africa to become Africa’s largest gold producer[27] While large-scale mining dominates Ghana’s economy, small-scale and artisanal mining (locally known as "galamsey") also flourish, particularly in rural areas. These activities, often informal and unregulated, contributes to gold production but brings challenges such as environmental degradation and conflicts over land use.[28][29] CommoditiesGoldGhana is one of the largest gold producers in Africa, and it ranks as the sixth-largest producer globally.[5] Gold has been central to the country's economy for decades. In 2023, Ghana produced around 4.2 million ounces of gold, contributing to approximately 4% of the world’s total output. The main gold-producing regions are Ashanti, Western, and Eastern regions, with major players including Newmont, Gold Fields, AngloGold Ashanti, and Kinross Gold. Gold exports in 2022 accounted for about 12.3% of Ghana's GDP.[30][31][32] The country’s gold deposits are primarily located within two major goldfields: the Ashanti Gold Belt and the Western Region Goldfields.[33][34] The Ashanti Gold Belt, in particular, is home to some of the most notable gold mines in the country, including the Ahafo and Akyem mines, both operated by Newmont. The Obuasi mine, one of the oldest gold mines in Ghana, is also situated within this region and is operated by AngloGold Ashanti. The mine has been in operation since the 1890s and remains one of the largest contributors to Ghana's gold output.[35] In the Western Region, the Tarkwa and Damang mines are major players in the gold sector. Tarkwa, operated by Gold Fields, is one of the largest gold mines in the country and has been producing gold since 1998. The Damang mine, also operated by Gold Fields, is a contributor to Ghana's gold exports.[36][37] ManganeseManganese is another key mineral in Ghana. The country ranks as Africa's second-largest producer of manganese, with production reaching approximately 2.5 million metric tons in 2022.[38] In 2022, Ghana exported $436 million in manganese ore, making it the fourth largest exporter in the world.[39][40] The main destinations for Ghana's manganese ore exports are China, Ukraine, France, and the Netherlands. Ghana’s manganese reserves are primarily concentrated in the Western Region, where the country’s main manganese mines are located. The Ghana Manganese Company Limited (GMCL) is the sole producer and exporter of manganese in the country. GMCL holds a mining concession over 170 square kilometers in the Western Region, centered around Nsuta. The Nsuta mine has been operational since 1916, making it one of the oldest manganese mines globally[41][42] BauxiteGhana holds significant bauxite deposits, an ore essential for aluminum production.[43][44] As of 2022, Ghana produced approximately 1.5 million metric tons of bauxite, making it an important player in the global bauxite market.[45] The country’s bauxite reserves are primarily concentrated in the Awaso and Nyinahin areas, which are the main sources of the country’s bauxite production.[46][47] Iron oreIron ore mining in Ghana is still in its early stages.[48][49] In 2022, the country produced an estimated 920,000 metric tons of iron ore, with production expected to increase as the industry matures.[50] Ghana’s iron ore reserves are primarily located in the Western and Northern regions, notably in the Bawdie and Shieni areas, which are recognized for their significant iron ore deposits.[51][52] DiamondDiamond is another notable contirbutor to the country’s economy.[53] In 2023, Ghana produced approximately 203,000 carats of diamonds, primarily sourced from alluvial deposits in the Akwatia region.[54] The diamond industry in Ghana is largely export-driven, with a smaller domestic industry focused on cutting and polishing. The majority of Ghana’s diamonds are exported to international markets, contributing to the country's mining exports.[9] The Akwatia region, located in the Eastern Region of Ghana, is the principal source of diamonds in the country. The area has been known for its diamond deposits since the 1920s, and mining operations have been ongoing since then.[55][56][57] Petroleum and natural gasGhana's oil and gas industry has experienced notable developments in recent years.[58] In 2022, the country produced approximately 60,000 barrels of oil per day and 200 million cubic feet of natural gas daily, primarily from offshore fields such as Jubilee and TEN.[59][60] Ghana's petroleum industry generated a record revenue of US$1.43 billion in 2022, the highest since the inception of oil production in the country.[61][62][63] The Jubilee field, situated approximately 60 kilometers offshore in Ghana's Western Region, was discovered in 2007 and is the country’s flagship oil field. It started production in 2010 and is operated by Tullow Oil, with other partners including Kosmos Energy, Anadarko, and the Ghana National Petroleum Corporation (GNPC).[64] The field has been a significant contributor to Ghana's oil industry, with production reaching 300 million barrels by October 2020[65][66] SaltSalt production in Ghana is an essential industry that plays a significant role in both local consumption and export.[67][68] In 2022, Ghana produced approximately 1.2 million metric tons of salt, making it one of the leading producers in West Africa.[69] The majority of the salt is harvested through evaporation ponds along the coastal regions, with the Greater Accra and Volta regions being the primary production areas.[70][71] In 2022, Ghana exported $4.36 million worth of salt, ranking it as the 59th largest exporter globally.[72] SilverSilver mining in Ghana is minimal compared to gold and it is produced in smaller quantities as a by-product of gold mining.[73] In 2022, Ghana's silver production was estimated at approximately 10,000 metric tons, primarily extracted during the processing of gold ores. While silver plays a secondary role in Ghana’s mining industry, it still contributes to the overall mining sector, alongside gold and other minerals.[74] The country’s silver production is primarily tied to gold mining operations in the Ashanti, Western, and Eastern regions, which are the main hubs for gold extraction. Major players like Newmont, Gold Fields, and AngloGold Ashanti oversee extensive mining operations in these areas, where silver is often recovered during the refining process of gold. Additionally, the Obuasi mine, also produces a small amount of silver as a by-product of its gold production.[75] LithiumLithium is emerging as a significant focus of Ghana’s mineral exploration efforts. The country has identified lithium deposits primarily in the Ashanti and Western regions, with several exploration projects underway[76][77][78][79] Impact of miningEconomic DevelopmentThe mining sector in Ghana has contributed to the nation's economic growth, with gold being a central export commodity. In 2023, Ghana produced approximately 4.2 million ounces of gold, accounting for about 4% of the world's total output.[80] The primary gold-producing regions include Ashanti, Western, and Eastern regions, with major players such as Newmont, Gold Fields, AngloGold Ashanti, and Kinross Gold. Gold exports in 2022 represented approximately 12.3% of Ghana's GDP.[81] Artisanal gold mining, locally known as "galamsey", has been credited with contributing to the development of local economies.[82] In 2023, Ghana's mining sector continued to be a significant contributor to the nation's economy. The sector's mineral revenue increased by 4.3%, rising from US$5.6 billion in 2022 to US$5.8 billion in 2023. Gold remains the leading export commodity from Ghana, contributing the highest percentage of the country's total export earnings.[83] As of October 2024, gold exports alone accounted for $9.58 billion, representing more than half of Ghana's total export earnings of $16.5 billion.[84] The mining sector also emerged as the largest source of domestic tax revenue in 2023, contributing a record GH₵11.55 billion (US$980 million) in taxes.[85] Government policies and programsRelevant institutions include:[86]
The Ministry of Lands and Natural Resources(Ghana) oversees all aspects of Ghana's mineral sector and is responsible for granting mining and exploration licenses. Within the Ministry, the Minerals Commission has responsibility for administering the Mining Act,[87] recommending mineral policy, promoting mineral development, advising the government on mineral matters, and serving as a liaison between industry and the government. The Ghana Geological Survey Department conducts geologic studies. The Ghana National Petroleum Corporation (GNPC) is the government entity responsible for petroleum exploration and production. The Precious Minerals Marketing Corporation (PMMC) is the government entity responsible for promoting the development of small-scale gold and diamond mining in Ghana and for purchasing the output of such mining, either directly or through licensed buyers.[88] The Mines Department has authority in mine safety matters. All mine accidents and other safety problems also must be reported to the Ghana Chamber of Mines, which is the private association of operating mining companies. The Chamber also provides information on Ghana's mining laws to the public negotiates with the mine labor unions on behalf of its member companies.[13] The overall legislative framework for the mining sector in Ghana is provided by the Minerals and Mining Act of 2006 (Act 703). Under the Law, mining companies must pay royalties; companies may also pay corporate taxes at standard rates. Other legislation that affects mining and mineral exploration in Ghana includes the Minerals Commission Law of 1986 (PNDC Law 154); the Small-Scale Gold Mining Law of 1989; the Investment Promotion Act, 1994 (Act 478); the Additional Profits Tax Law, 1985 (PNDC Law 122); the Minerals (Royalties) Regulations, 1987 (LI 1349); the Environmental Protection Agency Act, 1994 (Act 490); and the Environmental Assessment Regulations, 1999, and as amended, 2002. The Petroleum (Exploration and Production) Law, 1984 (PNDC Law 84), sets out the policy framework and describes the role of the Ministry of Mines and Energy, which regulates the industry. The Ghana National Petroleum Corporation (GNPC), which is empowered to undertake petroleum exploration and production on behalf of the government, is authorized to enter joint ventures and production-sharing agreements with commercial organizations; GNPC was established under the GNPC Law of 1983 (PNDC Law 64).[89] The regulation of artisanal gold mining is set forth in the Small-Scale Gold Mining Law, 1989 (PNDC Law 218). The Precious Minerals Marketing Corporation Law, 1989 (PNDC Law 219), set up the Precious Minerals Marketing Corporation (PMMC) to promote the development of small-scale gold and diamond mining in Ghana and to purchase the output of such mining, either directly or through licensed buyers.[13] Updated Mining Policies in Ghana The Minerals and Mining Act, 2006 (Act 703) (Government of Ghana, 2006): This is a comprehensive policy directive aimed at the regulation of minerals in Ghana, including small-scale mining operations. It outlines the procedures for granting mineral rights, requirements for environmental protection, and guidelines for health and safety.[90] Environmental Impact Assessment Regulations (Government of Ghana, 1994): In accordance with the Environmental Protection Agency Act 1994 (Act 490), Ghana has implemented regulations requiring all small-scale miners to undertake environmental impact assessments before beginning any mining activity. This is aimed at mitigating negative impacts on ecosystems and human health caused by unregulated or poorly managed mining practices.[90] The Environmental Assessment Regulations, (LI 1652) (Government of Ghana, 1999) which is a policy shaped to prohibit a person from commencing activities (such as mineral extraction) which have possible adverse environmental and public health impacts without first registering with the Environmental Protection Agency (EPA) and obtaining an environmental permit from the Agency in respect to the undertaking. Reclamation Bonds: Under Section 47 of the Minerals and Mining Act (Act 703), Small-Scale Miners are required to provide reclamation bonds as a guarantee against possible damage resulting from their activities. This bond ensures that post-closure site rehabilitation can be carried out effectively.[90] Minerals and Mining Policy 2016 (Government of Ghana, 2016) the Minerals and Mining Policy 2016 emphasizes the need for effective enforcement of laws and regulations governing small-scale mining operations while promoting responsible mining practices. It seeks to formalize informal artisanal miners into legal registered groups whilst simultaneously providing them with technical assistance, equipment supports among others.[90] Industry structureWhile the bulk of Ghana's mining industry is in legally sanctioned mining by large enterprises, small-scale miners - many operating illegally - extract a large percentage of Ghana's resources.[7] In the gold sector, Gold Fields Limited of South Africa held a 71.1% interest in the Tarkwa and the Damang gold mines in a joint venture with Toronto-based IAMGOLD Corp. (18.9%), and the Government of Ghana (10%) (U.S. Securities and Exchange Commission, 2005, p. 41). AngloGold Ashanti Ltd. of South Africa operated the Bibiani and the Iduapriem open pit gold mines and the Obuasi underground gold mine. The Bibiani and the Obuasi mines were 100% owned by AngloGold Ashanti and the Iduapriem mine was 80% owned by AngloGold Ashanti and 20% by the International Finance Corporation (AngloGold Ashanti Ltd., 2006a-c). Golden Star Resources Ltd. held a 90% interest in the Bogoso/Prestea and the Wassa open pit mines and a 90% interest in the idled Prestea underground mine. Newmont Mining Corporation of the United States held a 100% interest in the Ahafo gold property and an 85% interest in the Akyem gold property. Companies exploring for gold in Ghana included Adamus Resources Ltd., African Gold plc, Asante Gold Corporation, Moydow Mines International Inc., Pelangio Mines Inc., Perseus Mining Limited, and Xtra Gold Resources In the bauxite and alumina sector, Alcoa Inc. of the United States held a 10% interest in Volta Aluminum Company Ltd. (Valco); the remaining equity was owned by the Government. Alcan Aluminum Ltd. of Canada held an 80% interest in Ghana Bauxite Company Ltd.; the Government held the remaining 20% interest.[13] Environmental impactThe Ghanaian Environmental Protection Agency (EPA) was the Government entity responsible for the formulation of policies on all aspects of the environment. The agency's functions included acting in liaison and cooperating with other Government agencies; collaborating with foreign and international agencies, as necessary; conducting investigations into environmental issues; coordinating the activities of bodies concerned with the technical aspects of the environment for the purpose of controlling the generation, treatment, storage, transportation, and disposal of industrial waste; ensuring compliance with environmental impact assessment procedures; issuing environmental permits and pollution abatement notices; making recommendations to the Government for the protection of the environment; prescribing standards and guidelines related to the pollution of air, water, and land; protecting and improving the quality of the environment; and securing the control and prevention of discharge waste into the environment among several other functions.[13] In 2005, the Center for Public Interest Law and the Center for Environmental Law, two Accra-based nongovernmental organizations, sued Bonte Gold Mines Ltd. (an 85% owned subsidiary of Akrokeri-Ashanti Gold Mines Inc. of Canada), Ghana's Minerals Commission, and the EPA for the reclamation of the environment after the cessation of Bonte's gold mining operations along the Jeni River. Bonte closed its operations at Bonteso in the Ashanti region in March 2004, citing problems concerning low-grade ore, equipment unavailability, and a default of its financial obligations during 2003. The company allegedly did not follow the due process for mine decommissioning, such as by failing to post bonds to the EPA for the reclamation of lands, failing to notify workers of its intention to liquidate, not paying up-to-date wages to workers, and leaving a debt of about $18 million owed to various state institutions and private companies. The EPA and the Minerals Commission were accused of failing to ensure Bonte's compliance to operate in a sustainable manner.[13] Ghana's Obuasi region is known to host arsenopyritic goldbearing ore bodies. According to company reports, during the 1990s, an arsenic precipitation plant was installed at the Pompora Treatment Plant for the commercial recovery of arsenic from the roaster flue gases. At the time, the recovered arsenic trioxide was sold to Europe for commercial applications. As the market for arsenic declined, the treatment plant was shut down in 2000 and about 10,000 metric tons (t) of arsenic was stockpiled in bags at Obuasi. After the introduction of the Biox treatment process, the arsenic trioxide was converted to arsenic pentoxide and deposited in tailings dams. AngloGold Ashanti Ltd. (the company that was formed through the merger of Ashanti Goldfields Ltd. and AngloGold Ltd.) reported that inadequate storage of the stockpiled bags allegedly caused arsenic contamination to the Pompora stream. The problem was identified during the company's due diligence study prior to the merger. AngloGold Ashanti constructed a lined storage dam at the old heap leach site. The company planned to move the arsenic to a new facility where it will be stored and gradually disposed of by blending it into the Biox process circuit where it will be chemically stabilized and deposited as a component of the tailings residue in the new Sansu Tailings Storage Facility. The company estimates that it will take about 6 years to dispose of the arsenic.[13] Illegal mining has had an extensive impact on Ghana's environment. 60% of Ghana's water bodies are polluted by illegal artisanal gold mining, as well as industrial waste, household disposals and farming.[91][7] Artisanal and small-scale mining accounted for 43% of Ghana's total gold production in 2018, ensuing in high revenue rates and foreign exchange for government.[92] Despite the fact that this natural resource is a gift to the nation, the way it is being used renders it offensive. Despite the government of Ghana's numerous rules and laws intended to stop small-scale mining operations, the industry thrives. In order to control small-scale mining operations and advance sustainable development, laws such as the Environmental Impact Assessment Regulations, the Community Mining Program, and the Minerals and Mining Act, 2006 (Act 703) have been put in place. Miners continue to operate with impunity, producing extensive environmental degradation, disputes amongst communities, and problems with security officials, among other negative effects, despite the years-long efforts of several governments. AccidentsIn April 2013, at least 17 people were killed while mining illegally at a disused gold mine in Ghana's central region. The ground reportedly caved in on the miners as they searched for gold deposits, and authorities were unclear as to how many miners originally went in. Sixteen bodies were excavated, with one man dying in hospital from his injuries.[93] See alsoReferences
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