Home » Ghana’s New Lithium Deal Bans Raw Export, Eyes Local Refining

Ghana’s New Lithium Deal Bans Raw Export, Eyes Local Refining

Lands Minister Jinapor Confirms Local Processing Clause in Ghana's First Lithium Contract

by Adenike Adeodun

Samuel Abu Jinapor, Ghana’s Minister of Lands and Natural Resources, has affirmed the government’s decision to prohibit the export of lithium in its raw form. This announcement follows the approval of a mining lease for Barari DV Ltd, a subsidiary of Atlantic Lithium, for lithium extraction in the Central Region’s Ewoyaa concessions.

The ministry and the Minerals Commission have highlighted that the terms of the deal are exceptionally beneficial for Ghana and will be rigorously enforced. Consequently, Mr Jinapor revealed that the government included a specific clause in the agreement with Barari DV Ghana Limited, mandating a substantial portion of the mining value chain to remain in Ghana.

At a press briefing on Ghana’s First Lithium Contract, Terms, Benefits, and the Way Forward, held on Thursday, December 7, 2023, Mr Jinapor insisted that the contract includes provisions for establishing a local refinery and supplying lithium by-products to Ghanaian industries.

According to a report by the Daily Graphic, Mr Jinapor outlined several significant advantages of the lithium contract, including a 10% royalty for Ghana, one of the highest in the country’s mineral exploration history. Additionally, the government has secured a 19% stake in Barari DV Limited, which is expected to increase to 30% by the contract’s conclusion.

The Minister stressed that the lithium contract aligns with the ultimate interests of Ghanaians, including plans for public shareholding through the Ghana Stock Exchange.

Martin Ayisi, the CEO of the Minerals Commission, addressed criticism of the deal, attributing it to misinterpretations and inaccuracies. He clarified that the $250 million project in Ewoyaa, Mfantseman Municipality, Central Region, is set to start production by 2025. The terms of the deal include a 10% royalty and 13% free carried interest by the state, surpassing the typical 5% and 10% for other mining agreements.

Barari DV Ghana Limited will also contribute 1% of its revenue to a community development fund, aiming to improve the lives of residents in the mining area.

Edward NanaYaw Koranteng, Chief Executive of the Minerals Income Investment Fund (MIIF), highlighted the financial benefits for Ghanaians from the lithium deal. MIIF’s investment in the deal has already seen a 31% gain.

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