$10bn boost for mining industry …as new local content, participation regulations take effect
Following increases in items on the procurement list for the provision of goods and services from 41 to 50 in the mining industry, investment and mineral receipts have hit nearly $10billion.
This is as a result of coming into force of the Minerals and Mining (Local Content and Local Participation) Regulations, 2020 (L.I. 2431) on December 22, 2020.
The purpose of the regulations among others is to promote job creation using local expertise, goods and services in the mining industry and their retention in the country.
The law is also to achieve the minimum in-country spending on goods and services and to create mining and mineral related industries that will sustain economic development.
Pursuant to Regulation 7 of L.I. 2431, the Commission is required to publish a local procurement list which stipulates the goods and services with Ghanaian content which are to be procured in the country. Regulation 7(3) of L.I. 2431 further states that the Commission shall review the procurement list annually.
The new procurement list which is the fifth edition has 50 items. This replaces the fourth edition which was published by the Commission in early 2022.
The Commission commenced the implementation of the Fifth Edition on January 1, 2023.
Some items on the list have been enhanced to deepen local participation. Effective this year, the placement of insurance and re-insurance services by all mining companies which had a minimum of 20 per cent reserved for Ghanaians under the fourth edition have been increased to 60 per cent.
Mining companies are also required to ensure that 60 per cent of their financial services, including revenue from the sale of minerals which runs into several billions of dollars annually are to go to local banks.
Furthermore, all Tailings Storage Facilities and medical services at the mines are to be provided by Ghanaian-owned companies.
According to Mr Martin Ayisi, the Chief Executive Officer of the Minerals Commission, the increase in the items on the list comes at the time when receipts from mineral revenues and investments hit $10 billion.
For instance, there are four new projects with investment of about $ 1.7 billion.
He mention some of the new projects as the $850 million Ahafo North gold mine project by Newmont Ghana Gold Limited, the $500 million gold project currently under construction by Cardinal Namdini Mining Limited in the Talensi District of the Upper East Region, the $200 million gold mine to be constructed in the Upper West Region and the $125 million lithium project at Ewoyaa in the Central Region.
Additionally, Mr Ayisi stated that other mines who were undertaking expansion and redevelopment included the Ahafo South mine of Newmont which had been expanded to include the Subika underground while the Golden Star Wassa was spending about a billion dollars to expand the Wassa underground mine.
He mentioned some of the mines being redevelop as the Anglogold Ashanti Obuasi mine where a billion dollars had been expended and the Bibiani mine of Mensin Gold Ghana Limited which started production in the last quarter of 2022.
He said it was the expectation of the Minerals Commission that the investments would support the growth of the economy and boost local participation under the new procurement list.
Sorce: Ghanaiantimes
