Dr John Kwakye, Director of Research at the Institute of Economic Affairs (IEA), has advised the government to take its time in ensuring that Ghanaians get a decent deal in the lithium lease it signed.
He believes the mineral wealth should be left in the land until the government can receive a decent bargain.
“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 office,” he posted on his X platform in response to a statement by Minister of Lands and Natural Resources Samuel Abu Jinapor, who promised Ghanaians that the government would not authorize the export of raw lithium.
Mr Jinapor stated that the government included a stipulation in the lithium deal with Barari DV Ghana Limited that secures the retention of a major portion of the mining value chain in Ghana.
On Thursday, December 7, Mr Jinapor told a press conference on Ghana’s First Lithium Contract, Terms, Benefits, and the Way Forward that the Lithium Mining Lease includes provisions for the establishment of a refinery and the provision of lithium by-products to local industries, and that the decision to process lithium locally was in the best interests of the state.
The Minister listed significant benefits expected from the implementation of the Lithium deal, revealing that the contract will give Ghana 10% in the form of royalties, which will be one of the highest in the country’s mineral exploration history.
and that the government has also secured 19% state participation in Barari DV Limited, which is expected to scale up to 30% by the end of the contract.
“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.”
Mr Abu Jinapor stated firmly that the lithium deal is in the best interests of all Ghanaians.
Martin Ayisi, the Chief Executive Officer of the Minerals Commission, stated that the critical statements made by some individuals on the deal are the result of a lack of thorough reading of the agreement, noting that many of the concerns raised are based on inaccurate assumptions and unsupported assertions.
Mr. Ayisi stated that the $250 million project, which would be located in Ewoyaa, Mfantseman Municipality in the Central Region, will begin production in 2025.
The state will get a 10% royalty and a 13% free carried interest under the arrangement, which is more than the existing 5% and 10% for other mining deals.
He further mentioned that Barari DV Ghana Limited is expected to give 1% of its earnings to a community development fund for the improvement of the mining region.
Mr. Edward NanaYaw Koranteng, Chief Executive of Minerals Income Investment Fund (MIIF), stated that MIIF identified opportunities of undervalued shares at the time of closing the transaction with the locked in price of USD per share, and intrinsic value ranging from USD 1.25 to USD 1.9 per share.
“MIIF has already made a 31% gain in its planned investment in the lithium deal,” he stated.
