Government has granted Barari DV Ghana Limited, a subsidiary of Atlantic Lithium Limited, a fifteen-year Mining Lease to commence the construction and mining of lithium at Ewoyaa in the Mfantseman Municipality of the Central Region.
The Lease incorporates new and enhanced terms intended to ensure that the country benefits optimally from the mineral. This includes an increase in royalty rate, State and Ghanaian participation, as well as value addition to the mineral mined.
The granting of the Mining Lease follows the completion of prospecting and feasibility studies by the company, as well as series of negotiations between Government and the Company.
The Lease equally covers an area of approximately 42.63 square kilometers and grants the company the exclusive right to work and produce lithium and associated minerals in the area, in accordance with the mining laws of the country.
Speaking at a short ceremony to sign a Mining Lease for Barari DV Ltd., the Minister for Lands and Natural Resources, Hon. Samuel A. Jinapor, revealed that Government took a decision not to treat the mineral the same way other minerals have been treated.
As a consequent, he maintained that it was therefore, necessary to put in place a special policy for the exploitation and management of this mineral before granting any Mining Lease.
Additionally, Mr Jinapor expressed that after series of consultations, Cabinet approved a policy for the exploitation and management of green minerals including lithium, and the Mining Lease granted the company, incorporates the policy approved by Parliament.
“The Lease we are signing today differs from our standard Mining Lease, in that, it incorporates the agreed terms we have concluded with the company, based on the Policy approved by Cabinet.”Samuel Jinapor
Furthermore, Mr. Jinapor noted that the agreed terms give Government and the people of Ghana greater value in the mining of this mineral.
Ghana’s prospects in Lithium production
Giving some highlights on the Lease, the lands minister highlighted that the royalty rate has been increased to ten percent (10%) from the standard five percent (5%), and the State’s free carried interest in the mining operation has been increased from ten percent (10%) to thirteen percent (13%).
In addition to the free carried interest, he revealed that Government, through the Minerals Income Investment Fund (MIIF), will acquire additional six percent (6%) in the mining operation, as well as a 3.06% in the Company’s parent entity, which is listed on the Australian and London Stocks Exchange.
Also, Mr Jinapor indicated that the Company would also be required to list on the Ghana Stock Exchange to ensure that Ghanaian entities, like pension funds, and individuals who want to invest in the business can participate in it.
He further underscored that the Company will also pay one percent (1%) of its revenue into a Community Development Fund, to be utilised for the development of communities impacted by their operations and will work to establish a chemical plant for the processing of lithium.
In the event that the Company is unable to establish a chemical plant, Mr Jinapor revealed that the Company will provide its lithium to any chemical plant established by third parties in the country. This will create more jobs and bring more development into the mining communities and the country at large.
Moreover, he emphasized that Government recognizes the impact of mining on communities, and is committed to ensure that these communities, as well as Ghanaians who are, by law, the owners of these minerals, benefit from them.
To this end, he called on the company to adhere strictly to the mining laws of the country and the agreement reached with Government, and to ensure that they engage in responsible, sustainable and environmentally-sound mining practices.
On his part, the Executive Chairman of Atlantic Lithium Limited, Mr. Niel Herbert, expressed gratitude to the Minister and Government for their cooperation in reaching this milestone.
He revealed that the Ewoyaa project is very important to the company, and the company is willing to work with Government to ensure the effective exploitation of this mineral for the benefit of Ghanaians.
Additionally, he pledged the commitment of the company to abide by the laws of the Ghana, and ensure a safe mining environment.