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Parliament Approves Ghana Bauxite Company’s Mining Lease

Written by on June 26, 2024

Parliament unanimously ratified the mining lease granted by the Government to Ghana Bauxite Company for bauxite extraction at Awaso in the Bibiani Anhwiaso Bekwai Municipality of the Western North Region. This decision followed the presentation of a report by the joint Parliamentary Committee on Mines and Energy and Lands and Forestry on Wednesday, June 26th, 2024.

The Awaso bauxite mine plays a crucial role in the Government’s strategy to develop an integrated aluminium industry in the country. The Ghana Integrated Aluminium Development Corporation (GIADEC), tasked with promoting and developing this sector, has identified the Awaso mine as one of its key projects aimed at achieving this objective. GIADEC is collaborating with strategic investors to expand the mine and establish a refinery for processing bauxite mined in the region.

Established over eighty years ago, the Ghana Bauxite Company is currently the sole bauxite producer in the country. The company has evolved through various phases since its inception in the 1940s. Originally owned by the British Aluminium Company Ltd, the Government acquired a fifty-five percent (55%) stake in 1972 under the Mining Operations (Government Participation) Decree, 1972 (NRCD 132), as part of the National Redemption Council’s economic policy of nationalization.

Subsequently, the company encountered challenges, with production declining from four hundred and seven thousand tonnes (407,000t) in 1974 to just sixty-four thousand tonnes (64,000t) in 1982.

The Government later sold its stake in the company, and in 1997, Alcan, a Canadian company, acquired an eighty percent (80%) share, with the Government retaining the remaining twenty percent (20%). Subsequently, Rio Tinto, a British-Australian multinational, acquired Alcan’s stake before selling it to the Bosai Minerals Group in 2010.

In 2022, Ofori-Poku Company Limited (OPCL), a wholly Ghanaian-owned company, acquired the eighty-percent stake previously held by Bosai, marking the first time in eighty years that the company was fully Ghanaian-owned.

Established in 1990, OPCL boasts extensive experience in the mining industry, specializing in various mining services, including haulage, transport, and climate change solutions.

Following the expiration of its previous lease, the company was granted a new lease on May 3rd, 2024, covering the Kanayerebo, Subri, Nchiniso, Afumba, and Bokahirri Hills in Awaso. Earlier this month, the Minister for Lands and Natural Resources, Samuel A. Jinapor, MP, presented the mining lease to Parliament for ratification under Article 268(1) of the 1992 Constitution, which was subsequently referred to the Joint Committee on Mines and Energy and Lands and Forestry by the Speaker.

Presenting the Committee’s report to Parliament, Samuel Atta Akyea, Chairman of the Mines and Energy Committee, highlighted that the request for ratification of the mining lease aligns with constitutional provisions ensuring parliamentary oversight over natural resource management and utilization. He affirmed that the lease adheres to relevant laws and recommended its ratification, emphasizing potential benefits for government and socio-economic development in the region.

He stated that the Committee was satisfied with the company’s financial and technical capabilities to fulfill its obligations under the lease and therefore recommended its ratification.

Members of Parliament commended the Minister for Lands and Natural Resources for submitting the lease for ratification and emphasized the importance of adhering to constitutional requirements for parliamentary oversight of mining leases, noting past violations since 1992. They also applauded the government for securing Ghanaian investment in this strategic mine, which is now wholly Ghanaian-owned, and for including plans to establish a refinery to enhance the value of mined minerals.

They expressed optimism that these measures would benefit all Ghanaians.

Minister Samuel A. Jinapor thanked Parliament and the joint Committee for their thoroughness and unanimous support in ratifying the mining lease. He reaffirmed the government’s commitment to nationalizing the mining industry and ensuring full Ghanaian participation throughout its value chain.

The ratification of the mining lease grants the company full operational rights, secures employment for hundreds reliant on the mine, and contributes significantly to socio-economic development in the community and the nation as a whole.

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