Home » Ghana Union Seeks End to Mining Lease Over Financial Woes

Ghana Union Seeks End to Mining Lease Over Financial Woes

Protests Planned as Union Demands Government Intervene in Mine

by Ikeoluwa Ogungbangbe

The Ghana Mine Workers Union is pushing for the revocation of Future Global Resources Ltd.’s (FGR) mining lease, claiming that the company has failed to fulfill the financial commitments necessary to operate the Bogoso-Prestea gold mine effectively. Acquired from Toronto-based Golden Star Resources Ltd. in October 2020, the mine has since seen a steep decline in production and operational efficiency.

The union, which represents over 15,000 workers, has organized demonstrations scheduled for Thursday and Friday in Accra. Abdul-Moomin Gbana, the general secretary of the union, voiced the grievances in a recent phone interview, highlighting the company’s inaction since taking over the mine. “Since FGR took over the business in 2020, it hasn’t invested anything in the business and clearly, it has brought the business to its knees,” Gbana stated. He also pointed out that mining activity has been halted since December after the state energy producer cut off power supply due to nonpayment of bills.

The decline in the mine’s productivity is significant; previously, the mine produced 150,000 ounces of gold annually. Under FGR’s management, this figure has plummeted to less than 60% of its former output. This drop in production has led to considerable financial strain on local suppliers and vendors, with millions of dollars owed. Furthermore, the workforce has been severely impacted, with many workers finding themselves without work for the past four months.

FGR, a unit of UK-based Blue International Holdings, was established specifically to acquire and manage high-quality, long-term mining assets in sub-Saharan Africa. The acquisition of the Bogoso-Prestea mine, located in the Ashanti Region of Ghana — Africa’s top gold-producing country — was valued at approximately $95 million. However, the union claims that FGR’s inability to invest in the mine has not only jeopardized their jobs but also the economic stability of the area.

“We want to bring to the attention of the government that FGR has not been able to comply with the dictates of the lease and for that matter, the mining lease should be terminated so that the mine can be put on sale,” Gbana explained, highlighting the urgency of the situation.

The future of the mine remains uncertain. FGR currently owns 90% of the Bogoso-Prestea mine, with the remaining 10% held by the government of Ghana. The original owner, Golden Star Resources, was acquired in 2022 by China’s Chifeng Jilong Gold Mining Co., indicating a potentially complex backdrop to the ongoing financial and operational challenges faced by FGR at the site.

You may also like

Leave a Comment

The African Miner is the vanguard of the mining industry, delivering world-class insight and news.

Latest Stories

© 2024 The African Miner. All Rights Reserved.