Despite the several mining incidents that led to temporal shutdowns in some of its largest mines, Ghana is likely to maintain its spot as the continent’s top gold producer in 2021.
In 2019, Ghana won the gold producer crown, after South Africa surrendered its position to Ghana. At the time, Ghana’s aggregate gold output reached 4.577 million ounces compared to South Africa’s gold output of approximately 4.2 million ounces of gold.
Affected by the COVID-19 pandemic, gold output produced in Ghana declined to 4.023 million ounces in 2020 compared to approximately 3.5 million ounces in South Africa.
Major happenings in South Africa in 2021, including country-wide rioting, major power outages, stubbornly high costs, and geologic challenges in the mining and quarrying sector affected gold production during the course of the year.
Meanwhile, Ghana’s relatively stable political atmosphere, lower-cost mines, friendlier policies, have aided production and development in the year.
The mining and quarrying sector’s contribution to the country’s gross domestic product (GDP) reached 4.6 percent in 2020, according to data from Statistics South Africa. In Ghana, the mining and quarrying sector contributed approximately 5 per cent to GDP in 2020, according to the Ghana Chamber of Mines.
South Africa’s mining and quarrying industry boasts of key players including Anglo American Platinum, Kumba Iron ore, Impala Platinum, Sibanye-Stillwater, Gold Fields, Northam Platinum, Exxaro Resources, ARM, Harmony Gold and Royal Bafokeng Platinum.
Hurdles in Gold Production
Regarding gold production, South Africa has seen some of its major players move to Ghana over the past few years for the same major constraints highlighted.
South African industry stalwart Gold fields Ltd. focused more on its Ghana project, where it has for the past two years remained the largest gold producer, surpassing Newmont Ghana in 2019 and 2020.
Sibanye, South Africa’s largest remaining gold miner wholly dedicated to its South African projects said its 2021 gold production would be at the lower end of a 884,000-948,000 ounces range.
The company’s production was also affected by a safety audit in the fourth quarter of the year during which all of its operations were closed, as cases of Covid-19 surged among its staff.
Regarding safety, South Africa’s Minerals Council indicated in December that it was the second year of a “regression” in mine safety in the country, with miners reporting 72 fatalities up to Dec. 13, 2021 against 52 in the same period the previous year.
This notwithstanding, gold production faced some hurdles in Ghana. Notable among them is the temporary shutdown of AngloGold Ashanti’s Obuasi gold mine which forced the gold major to cut its production guidance for the year.
Safety incidents arose when AngloGold Ashanti’s underground mine site collapse led to the death of one of its miners. Overall, Ghana’s safety issues during mining have remained low, with its top miner, Gold fields scoring high in that regard.
In Ghana, key players within the mining sector are Gold fields, AngloGold Ashanti, Galiano Gold, Golden Star Resources, Perseus Mining.
In 2020, Gold fields aggregate production as a share of the Chamber’s producing members was 26.3%, the largest in the year. The company’s Tarkwa and Damang mines expanded by 18.5% and 17.8% respectively. AngloGold Ashanti’s aggregate gold output in its operated mines as a share of the chambers’ producing members was 14.1% in 2020.
This was followed by the JV mine of Galiano Gold and Gold fields, Asanko Gold Mine which accounted for 8.8% of the total share of the Chamber’s producing members. Golden Star Resources accounted for 5.9%, and Perseus mining 5.6%, according to the Ghana Chamber of Mines.
The Positive outturn recorded by some of the producers in the country presents good fortunes for the country’s sustained progress in gold production.
Perseus mining, for example, during its Q3 2021 results recorded high output results (112,786 oz of gold), reflecting a 10% rise in Q2 2021.
The company still expects higher output from its mines in the coming year, as it projects raising its output to 500,000 oz of gold per year.
“With our three gold mines now in operation and Perseus moving closer by the day to achieving our goal of producing 500,000 ounces of gold per year, we have turned our sights to finding ways of sustaining this level of gold production from our operations out to the end of the decade and beyond.”
Jeff Quatermaine, MD, Perseus Gold
Overall, Ghana’s mining sector will continue to be relevant to the continent as well as globally. However, the fight against illegal mining and gold smuggling are major downsides to this positive trend which the government must not relent in rooting out completely.
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