Papa Ankomah Saves Ghana

… Following colleague’s ‘one-woman’ show
… ?Millions would have been lost

Barely a week after The Chronicle had carried a front-page banner on how Ghana incurred a whopping debt of $3.5 through arbitration in London; the country was on the verge of suffering from a similar fate again but for the timely intervention and astute legal advice given by the Attorney General and Minister of Justice, Hon. Papa Owusu Ankomah.

Papa Owusu Ankomah’s advice has actually helped the country to save millions of dollars that would have been paid to an investor through arbitration, after the Ministry of Mines, who had entered into agreement with the investor on behalf of the state, arbitrarily abrogated the contract.

At the center of the dispute is a virgin mining concession at Mpeasem, which is located on the fringes of both the Central and Western regions, but extends largely into Amansie West district of the Ashanti Region.

The concession itself is owned by Kyam Mining Company Limited (KMC), which has its headquarters at Tarkwa in the Wassa West district of the Western Region.

KMC, which has two Ghanaians as its directors, became owners of the concession after signing an agreement with the government on June 21, last year, with the former Mines Minister, Hon. Adjei Darko, signing on behalf of the government.

The agreement was stamped with LVB.8720/02 and duly registered at the Lands Registry with registration number 1469/2002. The body of the agreement states “ the government hereby grants unto the company (KMC) the right and license to prospect for and prove gold…”

Over a year after this agreement had been entered into, the current Minister of Mines, Mrs. Cecilia Bannerman, in a letter dated June 26th, 2003, wrote to Kyam Mining Company that their prospecting license to prospect for gold at the Mpeasem concession had been withdrawn, though the company had not breached any part of the agreement that was signed with her predecessor, who acted on behalf of the government.

Already Seafor Mining Company (SMC), which is owned by a Swedish investor, one Ove Nordstron, and who, hitherto, were joint owners of the concession in dispute, together with KMC, is reported to be crying foul over the government decision to give the concession to their former partners after investing heavily in the concession area.

It is not however known if Mrs. Bannerman’s decision to withdraw the license from KMC was as a result of Seafor Mining’s protest.

An in-depth investigation conducted into the whole saga revealed that the concession in dispute that covers an area of 27.10 sq. miles was given to Kyam Mining Company in 1991 to prospect for gold.

The Chronicle gathered that because KMC was not having the necessary capital, it entered into a joint venture with Seafor Mining Company, with the Swedish Ove Nordstron as its chief executive. Under the joint venture agreement SMC was to bring all the necessary machinery to carry out the prospecting work and then own 75 percent shares.

KMC in its capacity as owners of the concession was given 15 per cent and the remaining 10percent went to the government.

The Chronicle was told that the joint venture agreement was later abrogated on March 17, 1997 when KMC detected that Mr. Ove Nordstron was hiring machinery he had brought into the country under tax-free, purposely for the project, back to the joint venture company.

The Chronicle has in its possession documents from SFO, after conducting investigation into this practice.

Later in the year 2000, the then minister of Mines and Energy, Dr. Frank Abu, in letter dated July 14, 2000 withdrew the license granted to the joint venture company after Seafor Mining had submitted a feasibility report that was found to be wrong.

KMC, who were the original owners of the concession, immediately re-applied for the concession, which was eventually given to them on June 21, last year, after meeting all the necessary conditions.

Surprisingly the then Minister of Mines, Hon. Kwadwo Adjei – Darko, who signed the agreement, later withdrew it but was forced to restore it back per letter MM/DB -47/285/02A dated 26th February 2003.

As if the issue was over, the current Minister of Mines, Mrs. Cecilia Bannerman, also in a letter dated June 26, 2003, wrote to withdraw the license from KMC once again.

The Chronicle learnt that the latest move forced the counsel for KMC to officially write to the Minister of Mines and the A-G, drawing their attention to the legal implications of withdrawing the license from his clients since they had not breached any part of the agreement.

They threatened to drag the issue to arbitration, as spelt out in the agreement, which would have resulted in the government paying a heavy amount in hard currencies as penalty to KMC.

The Chronicle was told that the A-G, after careful study of the case, advised that the withdrawal of the prospecting license from KMC be suspended due to its legal implications that could affect the government.

When contacted on phone last Friday evening, Papa Owusu Ankomah confirmed that a case of that sort was brought to his attention.

He could however not recollect the advice he gave since he deals with a number of issues on daily basis.

At the same time, he said though his door was always open to the press, it is not all issues that he could discuss with them.

The former Minister of Mines, Hon. Adjei Darko, also told this reporter on phone that whatever decision he took on the issue was based on advice of his technical men. He therefore directed the reporter to contact the Minerals Commission.

Mrs. Cecilia Bannerman would however not talk to The Chronicle on the issue. After several telephone calls to her office, her secretary collected both the fixed and cell phone numbers of this reporter and promised to call back but she never honored her promise.