Another Golden Opportunity Lost: Newmont’s Akyem mine sale and the broken promises of Ghana’s president

In the latter part of 2023, Newmont announced a planned divestiture of some mining assets as part of a strategy to focus solely on “Tier 1” assets, which were assets that had the potential to produce at least 500,000 ounces of gold equivalent for at least 10 years.

The timeline for the sale of these projects is the end of Q1 2025. One of the main projects earmarked for sale is the Newmont Akyem mine in Abirem. Quite recently, it was announced that the sale activity for Akyem was in its final stages.

From intelligence gathered, a sale announcement is going to be made in the next few days. Reports are that the successful bidder for the mine is a Chinese entity. Newmont as an entity has the right to sell to whoever is the highest bidder with the most favorable terms, and that fact is not in dispute, it is rather, the most rational and prudent decision and their sole right to dispense with their assets however they deem fit and beneficial to their interests.

However, for a mine of this size to be sold, the government of Ghana should have a right of consent. The President, in his SONA address this year stated on page 23 and 24 of his address, that “We will engage with Newmont to give priority to Ghanaian investors who will want to acquire this mine to ensure that our mineral resources better benefit the Ghanaian people”.

The President seems to have forgotten the promise he made to Ghanaians. Among the prime bidders were Ghanaian entities that are also capable of taking over the mine, even with the backing of the Minerals Infrastructure and Investment Fund (MIIF). The focus of this was to ensure that there was at least a Ghanaian majority stake in the Akyem mine, making sure that the resource and its full benefits remain domiciled in Ghana.

At a time when most African countries, and countries the world over are jealously guarding their natural resources by pooling together investments to ensure those resources remain in local ownership, it beggars belief that the Ghanaian government will throw away such a huge chance to be a part owner of a mine that has produced already some 420,000 ounces of gold with a lot more potential.

What is even more puzzling is that at a time when there is a whole uproar about our inefficient handling of illegal small-scale mining and its resultant ecological effects, we are rather comfortable with allowing a golden goose to be sold out. We have the capability of pooling together Ghanaian investment vehicles including funds from MIIF, SSNIT and others while owning a top-tier mine which could boost local gold reserves as part of the many nascent gold backed currency stabilization activity as well as local refinery capabilities.

That is why we find this sudden u-turn and desertion of an emphatic promise, which was a highlight of the President’s strategy for this year quite baffling. Obviously, the government has the upper hand to steer negotiations because Newmont isn’t leaving Ghana. As a matter of fact, its Ahafo mine is still a Tier 1 asset as far as their classification is concerned, meaning that they will still be operating that mine for the next 20 years at least. In fact, Newmont is investing $1.4 billion into its Ahafo North mine. Newmont also has the best and most liberal tax regime in Ghana, saving it over $2 billion in taxes. Surely, in any negotiation with Ghana, that is a very important card to hold. Considering that, Newmont will not want to antagonize any relationship with the Ghanaian government and would have been easily amenable to a deal that meets their valuation as well as reflects their values.

It is time for Ghanaians to enjoy and benefit from our mineral assets and resources, and Ghanaian entities have the right to pool resources together and take over a mine that is ran by some of the highest standards in the world, as Newmont does. It is an amazing opportunity to take up best practices from one of the best entities, as well as create a circular local economy around the gold through injection of local capital, local expertise, local content and situating the revenue locally instead of repatriating it abroad like we have done for over 100 years since the creation of the Obuasi mine some 120 years ago.

We demand the following:

1. That Parliament, as a matter of urgency, investigates why the mine is being sold to a foreign entity

2. Why do local entities that bid did not have the blessing of the presidency

3. The role of the minister of Mines and natural resources in advising the presidency with relation to the sale of the mine

4. Why did the government not leverage on a point of advantage to leverage and equip known and reputable Ghanaian agencies, including its own mining investment fund from partaking and benefiting from this gilt-edged offer

Nana Addo, as President of Ghana, must not fail Ghana on the issue of GOLD, which is what this country has been identified with for the last 700 years to the world. It would be a huge dent on any legacy he intends to keep if he fumbles on the gold issue both at the large-scale level and the small scale level, and history will never be kind to him.