Business News of Monday, 2 September 2013

Source: GNA

We must overhaul our Mining Laws - Wacam

Wacam, a human right, environmental and mining advocacy NGO, has called for a comprehensive review of the Minerals and Mining Act (Act 703) 2006 to ensure that Ghana derives maximum benefits from mineral resources.

Mrs Hannah Owusu-Koranteng, the Associate Executive Director of Wacam addressing journalist stated that “Past and present administrations have adopted a piecemeal approach to resolving the concerns of the people of Ghana with respect to mining and thereby allowing mining companies to do whatever they wanted in pursuit of their corporate interests, to the detriment of the people and Government of Ghana.”

“The mining industry goes through a boom and a bust. The high gold price peaked around $1,910 per ounce in 2011 from $290 per ounce in 1999 and $405 per ounce in 2004.

“In 2004, Newmont used a gold price of about $400 for its profitability analysis and even at that low level of gold price, the Company deemed the Ahafo Project as a profitable venture.”

She emphasized that today, with cash cost of Newmont around $600.00 and the price of gold hovering around $1,400, many mining companies like Newmont “are making a lot of profits while the State is losing out in terms of benefits”.

The Director explained that: Though the Act states that a development agreement is subject to ratification by Parliament, the discretion granted the Minister responsible for mines on a wide range of benefits to companies whose investment is more than US$500 million is the cause of the facility granted to Newmont in the investment agreement for the retention of 100% of its earnings in offshore account.

“The problem is with the Mineral Laws of our country and the opportunity for a comprehensive review of the Minerals and Mining Act of Ghana is now because we are already late in taking advantage of the gold boom” she reiterated.

calling for a review of the Minerals and Mining Act to the Minerals Commission, Mrs. Owusu-Koranteng said the review of the minerals and mining law should take on board the inclusion of the Free Prior and Informed Consent (FPIC) principle which gives mining communities leverage in the decision-making process that must be free from intimidation to accept or reject a mining project

“The Law must provide for ‘No Go Zones’ to protect our environment, especially Forest Reserves, from mining. It must also incorporate the Polluter Pays Principle for mining companies to absorb socio-cultural; environmental; civil; political and economic cost of their operations.”

Wacam said the Law must enjoin holders of mining rights and other businesses related to mining to respect and promote human rights including the rights of women, children and workers arising from mining activities, but not limited to making adequate provision for the progressive realisation of economic, social and cultural rights as they relate to mining activities and empowerment of women.

She called for the review of the fiscal regime for mining with respect to tax exemptions, stability clauses and the implementation of windfall profit tax to increase benefits to the country.

“Wacam recognises that the government of Ghana has signed and gazette the ECOWAS Directives on Harmonisation of Guiding Principles and Policies on Mining and it is expected that by 1st July 2014, Ghana would have internalised the provisions of the Directives in our laws to make the provisions justifiable,”