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Business News of Tuesday, 7 June 2016


Future of mining in Ghana bleak – Kweku Awotwi

Former Chief Executive Officer of the Volta River Authority (VRA), Mr Kweku Awotwi says the four-year-long energy crisis has left the mining industry uncertain of the future.

According to him, “For too long, capital-intensive businesses, such as mining, have remained uncertain about the security and stability of power supply, which have impacted significantly on their investment decisions.”

Mr Awotwi, who was speaking at this year’s West African Mining and Power Conference (WAMPOC), organised in Accra last week, therefore, charged government to expedite action in resolving the energy crisis the country is faced with.

The theme for this year’s conference was ‘Sustaining Mining and Power Investments: Meeting stakeholder expectations in a challenging global environment’.

Mr Awotwi revealed that mining giants, such as AngloGold Ashanti, Newmont, Goldfields and the likes, were all investing millions of dollars to move from surface to underground mining, adding that "if you don't know your cost input, you can't take that decision."

He noted that even when gold price is not high, mining firms wanted assurances that if they spent millions of dollars on their investments, they will be assured of a stable power supply because power is the largest input in the business.

"These are some of the things that are not very clear right now and these are the issues that the mining sector faces," he added.

Comparing the last period of energy crisis and the present, the former VRA boss observed that by all accounts, the 2006/2007 episodes of energy crisis were relatively short but severe, spanning 12 months.

“The current episodes that many would argue we are still in is in its fourth year and has had a disproportionally greater impact on the populace,” he said.

According to him, in 2006, Ghana had an installed capacity of 1800 megawatts, 1200 megawatts of hydro and 630 megawatts of thermal power, including the newly installed mines reserve plant that four mining companies built during the energy crisis of that period and subsequently handed over to the VRA.

“In 2016, the capacity has risen to 3300 megawatts, an 80% increase. We now have 1600 megawatts of hydro and another 1700 megawatts of thermal power; our hydro capacity has increased by 33% but thermal capacity has almost tripled by 170% increase.”