Ghana has signed its first-ever Lithium Lease Agreement with the Australian-based lithium Atlantic mining firm for the mining and construction of the lithium mineral at Ewoyaa within the Mfantseman Municipality of the Central Region.
The agreement was signed by the Minister of Lands and Natural Resources requires Lithium Atlantic to invest a sum of $250 million into the project in the country with its major production to commence in the year 2025.
The government has increased the state’s free carried interest in the company from ten per cent to thirteen per cent due to the newly approved policy statement on the mining of green minerals in Ghana which implies that the Government of Ghana would holds thirteen per cent shares in Lithium Atlantic.
Also, the Government of Ghana is expected to acquire extra six per cent shares in the company and three per cent in the holding company if listed in the Australian and London Stock Exchange, giving Government of Ghana an interest of nineteen per cent in the local company and three per cent in the foreign holding company.
Again, royalties expected to be given to the mining communities are pegged at ten per cent while the company is required to process the mined mineral locally by adding value to it to create job opportunities for the local folks and Ghanaians.
It is important to note that Ghana’s lithium discovery is estimated at 35.3 metric tons with a value of over $4.8bn over the life span of the mine. The project comprises deposits in Ewoyaa, Abonko and Kaampakrom approximately 100km southwest of Accra.
While the Minister for Lands and Natural Resources, Samuel Abu Jinapor and other government officials including the Chief Executive Officer of the Minerals Commission have hailed the lease agreement, arguing that it is the best mining lease agreement Ghana has received since it started commercial mining, some section of the public including the academia, civil society groups, traditional authorities within the Mfantseman area among others have kicked against the lease agreement.
The former Chief Justice of the Republic of Ghana, Sophia Akuffo strongly argued that the lithium mining lease agreement signed between the Government of Ghana and Barari DV Ghana Limited, a subsidiary of the Australian-based Lithium Atlantic Limited would not be profitable to the country.
In a complete dismissal of the terms of the lease agreement, the former Justice of the Supreme Court emphasized that the contract agreement for the Ewoyaa lithium project is not any different from the previous mining agreement that the country has signed.
She thus argued that the Government of Ghana must have sole ownership over the construction and mining of the lithium mineral resource to ensure that the state and the Ghanaian citizens fully benefit from it.
“It is not different in principle in the substance from any of Ghana’s previous colonial times types of agreements, some call it the Guggisberg model. Whatever description, all those agreements are the colonial type of agreements, which over the years have yielded very little good to the overall benefit of the average Ghanaian.”
Sophia Akuffo
Meanwhile, the Minority in Parliament has demanded that the government particularly the Minister of Lands and Natural Resources, Samuel Abu Jinapor submit the Lithium Lease Agreement before Parliament before the commencement of the mining and construction of the lithium at Ewoyaa within the Mfantseman Municipality of the Central Region.
The Ranking Member of the Energy and Mines Committee of Parliament, John Abdulai Jinapor asserted that per the provisions of Article 268 of the 1992 Constitution of the Republic of Ghana, such agreement must be sent to Parliament for ratification.
“Let me assure the people of Ghana that the Minority will not let you down, we will scrutinize the agreement, we will not allow this agreement to rush through. We will seek the guidance and the involvement of civil society, and we will speak to important personalities including former Chief Justice, Justice Sophia Akuffo who has been vocal on this Lithium agreement.
“The new order is lithium. Lithium is more profitable than gold, lithium is more profitable than diamond and the world order is moving to this green mineral. So, the Minority will insist that Ghana benefits from these resources and that the terms and agreement, if they are not in the interest of Ghana, the Minority will kick against that”.
John Abdulai Jinapor
Evidence from the African continent particularly in sub-Saharan Africa clearly shows a very troubling phenomenon of resource curse or the negative consequences that have plagued several countries rich in natural resources, such as mismanagement, corruption, and economic instability.
It is therefore imperative that Ghana pursue strategic planning, efficient governance, and sustainable policies in the mining and construction of the lithium mineral to escape the ‘resource curse’ which has plagued the African continent with the mining of several natural mineral resources and leverage the mining of lithium for sustainable and inclusive development.
At all costs, Ghana must escape the resource curse, the country owes this to posterity.
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