Ghana increases mining royalties

Ghana ‒ Africa’s second-biggest gold producer ‒ began charging a fixed 5% royalty rate to mining companies operating in the West African country in a bid to boost government earnings from the industry.

The new rate ‒ which was introduced with effect from March ‒ changes the previous range of 3% to 6%, Ghana Chamber of Mines president Dan Owiredu said at the group’s annual meeting here.

South Africa’s AngloGold Ashanti Limited, which operates the Obuasi gold mine, and Colorado-based Newmont Mining Corporation have so-called stability agreements that make them exempt from the changes, Owiredu added.

“Mining companies which do not have stability agreements with the government have started paying the new rate,” he said.

AngloGold and Newmont’s agreements are capped at 3% over 15 years, Newman Kusi, an adviser to Ghana’s Finance Ministry, said by phone today. The government is “negotiating” with those companies about paying the new rate, he said.

In 2010, gold production in Ghana rose 1.4% to 2.97 million ounces, with sales earning US$3.62 billion, the Chamber of Mines revealed in March. Ghana also mines manganese, bauxite and diamonds.

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Time: June/2/2011    See In: Ghana• gold• index

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