Ghana to review mining stability agreements

Ghana, Africa’s second-largest gold mining state, has set up a committee to review stability investment agreements with mining houses, a senior government official said yesterday.

“It will include all companies that have stability agreements,” Benjamin Aryee, the chief executive of Ghana’s Minerals Commission, told Reuters on the sidelines of an industry conference in Cape Town.

“Ghana believes in the sanctity of contracts. But in all contracts there are review provisions,” he said.

Ghana’s finance minister initially unveiled the plan to review mining stability agreements in October. The government has since detailed plans to raise the corporate mining tax to 35 percent from 25 percent and introduce a 10 percent windfall tax as well to boost the state share of revenues.

The country set up a committee to review and renegotiate mining contracts last week.

Mining companies that have had stability agreements in Ghana include South Africa-based AngloGold Ashanti, the world’s third largest gold producer.

Gold Fields, the world’s fourth largest gold producer company, has said such a move might kill planned projects that could bring $1 billion of investment into the West African nation.

Ghana’s review comes against the backdrop of a surge of resource nationalism across Africa as governments aim to extract move revenue from a sector that has failed to translate mineral wealth into broad prosperity. (Reuters)