Gold volumes plummet

Gold Frr PMMC witnessed close to 70 percent drop in its revenue derived from assaying gold

Tue, 9 May 2017 Source: thefinderonline.com

Institutions, businesses and individuals who buy, process and export gold produced by small-scale miners have witnessed a big drop in volumes of the metal due to the government’s fight against ‘galamsey’.

The Ministry of Lands and Natural Resources had placed a moratorium on small-scale mining, whether licensed or not, plunging companies that buy, process and export gold into financial turmoil.

Sector Minister John Peter Amewu says the ‘war’ against illegal mining remains the topmost priority of the government and that it would ensure that the practice becomes unattractive.

Small-scale miners produced One million ounces of gold in 2015

Data from Minerals Commission reveal that small-scale miners produced over one million ounces of gold (1,031,179) in 2015 which represents about 34 percent of Ghana’s total gold production that year.

Since large-scale gold producers export all their gold, businesses, institutions, and individuals, in need of gold, depend solely on small-scale miners for the precious metal.

PMMC revenue drops by 70% due to galamsey fight

But, as a result of the success of the ‘galamsey’ fight, state-owned Precious Minerals Marketing Company (PMMC), for example, has witnessed close to 70 percent drop in its revenue derived from assaying gold (testing, checking carat and weight of gold as well as valuing the metal).

The drop in revenue reflects the drop in the volume of gold exporters present to PMMC for testing and value.

From November, last year, PMMC was appointed as the national assayer of all gold produced in the country – both small and large scale miners – before exports while ceding its role of buying, selling and shipping gold to licensed gold exporters.

When contacted on the impact of the ‘galamsey’ fight on their operations, General Manager of PMMC, Venance Dey, told The Finder that the fight against ‘galamsey’ is non-negotiable as the illegal act threatens the future of all Ghanaians.

The way forward

He noted that it was imperative for illegal small-scale miners to quickly fully adhere to the directives of the Minister of Lands and Natural Resources for speedy resolution to facilitate the resumption of legal small-scale mining.

For him, this is critical to the survival of all stakeholders, especially the miners, goldsmith, licensed gold buyers and exporters and PMMC, among others.

Role for foreigners

They said foreigners, involved in small-scale mining, must stop their operations since it is against the laws of the land.

Rather, he said, they should begin to redirect their energies into investments to process minerals legally produced in the country, adding value in the supply chain before exports.

PMMC also operates a jewellery production unit which, last year, entered into a Public Private Partnership (PPP) agreement with an Indian Company Aditan Enterprise Limited and operating as PMMC Jewellery Limited, a subsidiary of PMMC.

This, he said, means PMMC derives majority of its revenues from testing, checking carat and weight of gold purchased by licensed buyers.

$2 billion gold assayed in 2016

He stated that the value of gold assayed last year was close to $2 billion.

Dey also stated that the directive empowered PMMC to, for the first time, in the history of Ghana to test, check carat and weight of gold produced by all large mining firms as well.

New centre at Kotoka International Airport

However, he said the assaying of gold by large-scale mining companies has not started due to some delays in the installation of assaying machines at Kotoka International Airport (KIA), which, he indicated, should be ready by the end of this month.

He disclosed that the World Bank is assisting PMMC to put up state-of-the-art equipment at KIA, which is nearing completion, to test, check carat and weight of gold by large companies before export.

PMMC established in 1963

The PMMC was established in 1963 as Ghana Diamond Marketing Board and was charged with the responsibility of purchasing and marketing Ghana’s diamonds.

In 1965, by Legislative Instrument (LI) 401, the Company was incorporated as a State-Owned Enterprise (SOE) and with the promulgation of the diamonds decree (NRCD 32) in 1972, LI 916 was enacted to change the company's name to Diamond Marketing Corporation.

In 1989, PNDC Law 219 was enacted to yet again change the Company's name to the Precious Minerals Marketing Corporation.

Then finally in year 2000, it was converted by Act 461 (Statutory Corporations Conversion to Companies Act) to a Limited Liability Company to operate under the Ghana Companies Code (Act 179 of 1963) as Precious Minerals Marketing Company Limited.

Source: thefinderonline.com
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