The Minerals Commission has declined Gold Fields Limited’s application to renew the Damang Mining Lease for another 30 years Chief Executive Officer, Martin Ayisi told the media.
The current 30-year lease, granted in April 1995, expires on April 18, 2025.
According to information gathered by Ahotoronline.com, the Minerals Commission’s decision is based on Gold Fields’ failure to demonstrate material compliance with the requirements of the Minerals and Mining Act, 2006 (Act 703).
Expressly, the company declared no mineral reserves at the Damang mine in its 2024 annual report, and no exploration was proposed for 2024.
The mining operation at Damang commenced in August 1997, and the company has been a significant contributor to Ghana’s gold production. Gold Fields Limited owns the Tarkwa and Damang mines, with the Government of Ghana holding a 10% stake in both mines.
As reported by Ahotoronline.com, 32% of Gold Fields’ global production comes from its Ghanaian mines, translating to nearly a third of the company’s entire gold production worldwide, based on the company’s 2024 Annual Report.
The company ceased mining operations in 2023 and has been processing stockpiles since then. The 2024 Annual Report indicates a life of mine of one year, with plans to continue processing stockpiles in 2025.
The rejection of the lease renewal application underscores the need for the state to indigenize the mining sector, ensuring that the wealth generated from Ghana’s resources benefits its people. This decision also highlights that mining leases cannot be granted in perpetuity.
The Government of Ghana holds a 10% stake in both the Tarkwa and Damang mines, which are owned by Gold Fields Limited.
The Minerals and Mining Act, 2006 (Act 703) outlines the requirements for mining lease renewals. Gold Fields’ failure to meet these requirements led to the rejection of its application.
With the lease set to expire, the future of the Damang mine is uncertain. The company’s plans to process stockpiles in 2025 may be affected, and the government may need to consider alternative options for the mine.
The rejection of Gold Fields Limited’s lease renewal application marks a significant development in Ghana’s mining sector, ensuring that mining activities benefit the local economy.
Source: Richard Nana Appiah Kubi/Ahotoronline.com
