Cabinet approves 20-year cap on mining leases under new reforms

The Government of Ghana, through Cabinet headed by President John Dramani Mahama, has officially endorsed a comprehensive review of the Minerals and Mining Act, 2006 (Act 703), introducing sweeping legislative reforms aimed at tightening the regulation of the country’s mineral resources. The announcement was made by the Deputy Minister for Lands and Natural Resources, Alhaji Yusif Sulemana, during the official commissioning of the new multi-million-cedi Ashanti Regional Office complex of the Minerals Commission in Kumasi. Delivering a statement on behalf of the Minister for Lands and Natural Resources, the Deputy Minister disclosed that the proposed legal reforms represent a fundamental shift towards protecting state revenue, curbing speculative landholding and modernising mining administration across the country. Outlining the specific statutory changes approved by Cabinet, the Deputy Minister highlighted three major policy shifts. Reduction in mining lease duration Under the proposed reforms, the maximum duration of mining leases will be reduced from 30 years to 20 years. The government explained that the adjustment is based on empirical data showing that most modern mines are depleted in less than a decade, making 30-year leases unnecessary and potentially encouraging land hoarding. Abolition of tax-shielding development agreements The review will also abolish development agreements that previously allowed foreign shell companies to benefit from long-term exemptions from certain national taxes, duties and statutory levies. Single exploration licence with five-year cap Reconnaissance and prospecting licences will be merged and replaced with a single Exploration Licence capped at five years. According to the Deputy Minister, the consolidation is aimed at eliminating bureaucratic delays and ensuring that exploration activities are active and time-bound. New Ashanti Regional office Commenting on the newly commissioned Ashanti Regional office, the Deputy Minister said attendees at the event observed that the new Kumasi facility surpasses even the Minerals Commission’s national headquarters in Accra in terms of modern infrastructure and stature. The Ministry noted that locating such a premier facility in Kumasi underscores the strategic importance of the Ashanti Region as the historic and operational heart of Ghana’s mining industry. On behalf of the Minister for Lands and Natural Resources, the Deputy Minister expressed deep gratitude to the Overlord of Asanteman, Otumfuo Osei Tutu II, for his continuous guidance, input into national mining policy reforms and generous release of land for public infrastructure. “The Asantehene’s role in making direct inputs into these legislative reforms is on record. His role in providing land and assisting us to modernise and decentralise land administration across the country is well documented,” the Minister stated.Source: Nana Peprah, Contributor
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