Lithium Mining Deal Boasts Unprecedented Benefits for Ghana, Says Lands Minister

Ghana’s Minister of Lands and Natural Resources, Samuel Abu Jinapor, defended the mining license granted to Barari DV Ltd for lithium mining at Ewoyaa in the Central Region, asserting that it is one of the best deals globally. Contrary to criticisms from civil society organizations (CSOs), Jinapor emphasized that the agreement includes a remarkable 10% royalties, one of the highest globally, and a significant 19% state participation. The minister addressed concerns about the lack of a tender process, stating that international best practices and legal frameworks supported the company’s right of first refusal based on its exploration efforts.

Unprecedented Terms:
Minister Samuel Abu Jinapor highlighted the lithium mining license’s unprecedented terms, including a 10% royalty rate, representing one of the highest globally. He also emphasized the government’s successful negotiation for a substantial 19% state participation in the mining venture.

Global Recognition:
Despite criticisms from various quarters, Jinapor maintained that the lithium deal is regarded as one of the best globally. He pointed to the significance of the terms secured for Ghana, showcasing the country’s commitment to maximizing benefits from its natural resources.

State Participation and Local Listing:
The minister outlined that the government secured a 19% state participation in the mining company, with plans to increase it to a minimum of 30% through listing on the Ghana Stock Exchange. This approach aims to provide Ghanaians and local entities with opportunities to participate in the venture.

Response to Critics:
Jinapor acknowledged the criticisms surrounding the lithium deal but expressed disappointment that public commentary often failed to delve into the finer details of the mining lease. He defended the deal, emphasizing improved terms, including royalty rates, Ghanaian equity, community development contributions, and the commitment to establishing a refinery.

Tender Process Explanation:
Addressing concerns about the absence of a tender process, the minister explained that international best practices, as well as legal frameworks, support a company’s right of first refusal based on exploration efforts. He highlighted specific instances in which the tender process could be applied, clarifying that exploration activities by private entities often entitled them to mining leases without tendering.

Parliamentary Ratification:
Jinapor clarified that the mining lease granted to Barari DV Ltd is subject to ratification by Parliament, as outlined in the constitutional provisions. He assured that the necessary processes, including securing Cabinet approval, were ongoing, and the agreement would be laid before Parliament for consideration and ratification.

In defending the lithium deal, Minister Jinapor aimed to dispel criticisms and showcase the tangible benefits and strategic considerations that make the agreement favorable for Ghana’s interests.