Who is lying about Newmont’s Akyem ‘‘Galamsey’’ Mine?

Fri, 22 Nov 2013 Source: Atta-Quayson, Alhassan

Alhassan Atta-Quayson, University of Education, Winneba

For the second time within a short period of three months in this year, Ghanaian Parliamentarians have been thrown into a total shock as they confront salient aspects of the country’s enclave mining regime which is highly skewed in favour of foreign mining companies. Earlier it was about an archaic part of the mining law (and the entire law is largely archaic) which allows mining companies “to retain in an external account, not less than 25 per cent of foreign exchange earnings” (Section 29 of PNDCL 153 on Transferability of Capital). This provision has been maintained in the current mining law (Section 30 of ACT 703) and this explains why it is archaic as conditions that provided the basis for such provision have changed.

So in theory mining companies can keep all their foreign exchange earnings abroad. And when they are now arguing that parliamentary ratification or approval of their contracts and agreements is not necessary to give their operations the necessary legal backing we should understand why the Executive signed an agreement with Newmont which allows the multinational company to retain in an external account ALL foreign exchange earned from selling our gold they mine.

This time around the Chairman of the Parliamentary Committee on Mines and Energy (one Dr. Kwabena Donkor) expressed shock that Newmont has started mining gold at its Akyem mine even before its mining lease is ratified by parliament. I understand some other MPs have expressed similar worries. Dr. Donkor has consequently described Newmont’s operations at the said mine as illegal, hence the company is engaging in ‘‘galamsey’’ mining activity – a very popular categorization for widespread illegal small scale mining activities in the country.

As expected, the Minister of Lands and Natural Resources (one Alhaji Innusah Fuseini, a very respected legal luminary) has mounted a strong defence for the company arguing that the 1992 Constitution vests mineral resources in the President and an agreement between the Executive and a foreign mining company cannot be described as illegal. But article 268 of the same constitution insists that such an agreement shall be subject to ratification by Parliament and this is the basis for Dr. Donkor’s position. Further, section 5 of the current mining law (ACT 703) under power of minister to grant mining rights also provides that Newmont’s Akyem lease shall be subject to parliamentary approval.

I think that the Minister knows all these and what he sought to do was to ‘‘blindly’’ defend the company (which is business as usual with these ministers) or to reduce parliamentary ratification in Ghana into an unnecessary rubber stamp! The role of parliament in Ghana’s democracy is quite clear and in respect of ratifying agreements entered into by the Executive, such a role should not be mere ‘‘rubber stamps’’ as has been the case in the past. In 2011 the World Bank published a report with some information which confirms my ‘‘rubber stamp’’ allegation, at least in the past. The report revealed that 21 mining leases granted by various Ministers between 1994 and 2007 were retroactively ratified in 2008. This is a bad practice and I can envisage Parliament making some efforts towards change (positive change for that matter). I therefore find it somewhat awkward for the Minister who doubles as an MP to defend such a bad practice.

The business as usual attitudes of these Ministers who ‘‘blindly’’ defend foreign mining companies can be substantiated by a similar defence in October 2001 when there was a cyanide spillage at Abekoase near Tarkwa in the Western Region by Goldfields Ghana Limited. In that case, the cyanide containment pipes of the said company burst following a heavy downpour, releasing an unknown amount of cyanide solution into River Abekoase. The then Minister for Environment immediately came to the public (just as Alhaji Fuseini has done in this case) to indicate that ‘‘only 52 fishes died’’. This was a blatant false in defence of a foreign mining company.

I understand that the President of Ghana Chamber of Mines (one Dr. Tony Aubynn) and an External Affairs and Communications Director at Newmont (one Adiki Ayitevie) have waded into the debate, suggesting that it’s been the practice and Newmont is not doing anything illegal. This is indeed a bad practice and an illegal one. Even though Dr. Aubynn indicated his profound respect for rule of law it is clear that such respect cannot be extended to all laws and some aspects of the constitution in the country.

He ought to know the references I have cited above from the constitution as well as the current mining law. And if he truly respects the rule of law then he must admit that Newmont’s operations at Akyem violates the constitution and the current mining law, unless he views parliamentary ratification as an unnecessary ‘‘rubber stamp’’. Parliamentary ratifications are necessary requirement for the documents in question to become fully legal. The fact that mining companies have shown gross disrespect for this requirement should not mean such abnormal practice becomes a normal practice. A new normality for that matter!

Dr. Aubynn gave an excuse that parliamentary ratification cannot and should not delay a legal time-table. This is excuse is very poor in law. Anytime that the Executive enters into an agreement with any economic entity there are usually timelines. And these timelines become fully legal only when the agreement has been ratified by parliament (if necessary like in the mining sector). The US$3 billion chines loan which raised a lot of concerns a couple of years ago had timelines before it was taken to parliament for ratification yet those timelines did not render parliamentary ratification as mere formality or ‘‘rubber stamp’’ as is being argued.

Even though it is not the duty of the company to obtain such ratification the company ought to know that full legal backing for its operations lies in the ratification of its lease by the Parliament, in accordance with the constitution and the mining law.

As for the External Affairs and Communications Director at Newmont she seems to be doing just what she has been paid to do. Very little, if any, of what will strengthen Ghana’s democratic dispensation and move the country forward.

Is citizen vigilante still in the country? And can this brouhaha over the legality of Newmont’s Akyem mine be settled in the Supreme Court? May be we should call on one Kwaku Kwarteng (MP for Obuasi) who has recently taken another multinational mining firm (Anglogold Ashanti) to court for usual breaches in the mining sector.

I end with a word of appreciation to Dr. Kwabena Donkor and all MPs who are on his side for upholding the larger public interest. I urge you to continue the good work so that the precious and irreplaceable resources that Ghana is endowed with shall be exploited in a manner that primarily benefits Ghanaians. I shall always be available to provide whatever support I can to protect the public interest in the face of multinational companies that are bleeding the Ghanaian economy.

Columnist: Atta-Quayson, Alhassan