SA mining giant Gold Fields has come to an agreement with Ghanaian authorities to continue operating its Damang mine for another year.
The agreement is conditional on Gold Fields hiring more workers and investing in extending the operations’ lifespan, a direction Gold Fields had previously shown little interest in.
The miner had been ordered to halt operations at Damang and evacuate the area by the end of last week after an application to extend the mine’s lease was rejected for a second time.
However, the Ghanaian presidency said in a statement on Wednesday that a new 12-month mining lease would be issued to a Gold Fields’ subsidiary pending parliamentary ratification in May.
Gold Fields chair Yunus Suleman welcomed the agreement, as an “opportunity for Damang mine to continue creating value and making a sustainable economic contribution to the communities surrounding Damang, under future ownership of the people of Ghana”.
“We remain committed to operating in Ghana, and to continuing contributing to the country’s mining expertise, development and shared prosperity for many years to come,” said Suleman.
Gold Fields holds a 90% stake in Damang, which recently transitioned to processing stockpiles after it reached the end of its active mining lifespan last year, but still holds an estimated gold resource of 2.27-million ounces. The remaining 10% is owned by the Ghanaian government.
Damang will now continue to process surface stockpiles while Gold Fields awaits the necessary permits from the minister of lands and natural resources to recommence open pit mining.
Gold Fields said it submitted a plan to restart operations, which ensured “continued employment and an increase in jobs created”. The miner will also finalise a “detailed bankable feasibility study to extend the life of Damang mine” by the end of this year.
As part of the state's drive to increase local participation and ownership in Ghana's mining industry, advisers appointed by Gold Fields and the government will collaborate to ensure a smooth transition of the mine “to ownership by the people of Ghana”, the company said on Thursday.
“This is an important day for Ghanaian mining as we strengthen our partnership with Gold Fields. Increased local participation and ownership in Ghana’s mining industry is a key part of Government’s commitment to creating wealth for Ghanaians,” said Ghana President John Mahama.
“Gold Fields has a long and positive history in Ghana, and we are pleased to be working with them to safely and sustainably operate the Damang mine and ultimately transition it to the people of Ghana.
“Ghana remains open for business and welcomes investment. Working side by side with global and local companies, we believe that we can create partnerships that are beneficial and sustainable,” he said.
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