Why is the Minister and his bosses in a haste to sign lithium deal? - John Kwakye

The Director of Research at the Institute of Economic Affairs (IEA), Dr John Kwakye, has questioned the government’s haste in signing the lithium deal when there are so many controversies surrounding it.

He argued that the government needs to take more time to negotiate the lithium deal for the country to be able to secure the best for the country.

According to him, until a good deal is found, the mineral resource can stay in the soil unmined.

“Why is the Minister and his bosses rushing with the lithium lease? We want enough time to get the best lease for Ghana. Until then, the lithium can stay underground and the Minister can exit the office,” he wrote on his X platform on December 7, 2023.

The IEA boss made the comment in reaction to Ghana’s stake in the lithium mining deal.

The Minister of Lands and Natural Resources, Samuel Abu Jinapor, indicated that by the end of the finalization of the lithium mining deal, Ghana will have a participation rate of 30% while Barari DV Ghana Limited will get 70%.

According to him, this is the first time in the country’s history that it has been able to negotiate 10% royalties in a minerals deal.

Ghana signed a 15-year lease agreement with lithium mining company Barari DV Ghana Limited, a subsidiary of Atlantic Lithium Limited, to commence the construction and mining of lithium at Ewoyaa in the Mfantseman Municipality of the Central Region.

The deal includes a 10% royalty and 13% free carried interest by the state, surpassing the existing 5% and 10%, respectively, for other mining agreements.

Addressing a press conference on December 7, 2023, the lands minister said “Suffice for me to point out that it is the first time in the history of our country that we have successfully negotiated for 10 percent royalties for any mineral which is one of the highest for the exploration of any mineral across the world.”

He added, “We have already secured 19 percent state participation in this mining company with the requirement to scale it up to a minimum of Ghanaian participation through listing on the Ghana Stock Exchange for shares to be made available to Ghanaians and Ghanaian entities.

“What this simply means is that when it is all over, Barari DV Limited, the holder of this mineral right of lithium, Ghanaian and state participation will be 30 percent, and foreign participation will be a maximum of 70 percent and this has never happened in the history of our country in respect of any mineral,” he emphasized.

SSD/NOQ

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