Newmont Ghana Gold pays 2nd quarter royalty

Accra, July 31, GNA - Newmont Ghana Gold Limited's Ahafo mine has paid 2.46 million dollars to the government as royalty for its second-quarter production, the company said on Tuesday. The amount represents three percent of 123,574 ounces of gold it produced and sold during the April-June period, about 16.5 percent higher than originally projected, External Relations Director, Dr Chris Anderson, told the Ghana News Agency.

He said the company had projected 106,000 ounces for the quarter. The mine produced and sold 124,862 ounces of gold in the first quarter on which it paid 2.4 million dollars as royalty. The Ahafo mine, which poured its first gold in July 2006, is projected to produce 500,000 ounces of gold yearly. "For the period 18 July 2006 to 30 June 2007 - almost one year - this means that a total of 8,594,330 dollars was paid by Newmont to the government of Ghana in royalties since Ahafo first began official operation," said Dr Anderson.

The mine produced 203,000 ounces between its first gold pour from July to December, down from an initial forecast of between 225,000 and 250,000 ounces. The shortfall was due to a national power crisis, the company said.

Ghana is yet to pull out of a crippling energy crisis that hit the country last August, leading to a national load shedding under which bulk users were asked to curtail consumption by 50 percent. Dr Anderson said the mine has had to install four units of high capacity diesel generators to run its plant at costs four times higher than power from the national grid.

The Ahafo mine, which has a revised 25-year lifespan, is capable of processing seven million tons of ore yearly.

Dr Anderson said by the end of2007, Newmont would have invested over 665 million dollars in the Ahafo project, adding that over 50 percent of total operational expenditures will stay in Ghana and impact its economy.