The government’s approval of a new lithium policy in July 2023 laid the groundwork for the enhanced mining agreement secured with Barari DV Limited, recognising lithium’s importance for the green energy transition.
A press statement signed by the Minister for Lands and Natural Resources, Mr Samuel Abu Jinapor, on Friday, disclosed that the cabinet deliberated and amended a proposal he submitted in May 2023 outlining the framework for exploiting Ghana’s lithium resources.
The approved policy, according to the press statement, encompassed higher royalties, 30% state participation, local content mandates and value-addition requirements for lithium mining.
This provided the basis for ensuing negotiations between the government and Barari DV Limited, which had discovered commercial lithium deposits in the Central Region.
The talks resulted in a mining lease containing innovative provisions beyond Ghana’s standard mining terms, per the cabinet-backed policy.
Key elements include 10% royalties, 13% free carried interest, state acquisition of company shares, Ghana Stock Exchange listing, a chemical plant and more local participation.
The Minister explained that without the cabinet’s judicious policy approval, Ghana may have simply followed standard mineral lease terms of 5% royalties and 10% state interest.
However, recognising lithium’s importance for the green energy transition, the government decided to strategically leverage it differently.
The approved policy provided the legal footing for government negotiators to argue for a deal that derives enhanced benefits for Ghana.
The Minister assured that despite criticisms, the lease would still undergo constitutional parliamentary ratification, where the government is prepared to justify the improved terms.
He assured the government’s commitment to efficiently managing Ghana’s resources sustainably for the people’s benefit, conducting negotiations in utmost good faith and transparency.
The detailed defence comes after minority MPs and groups raised concerns about the agreement announced this week, calling for accountability. The Minister affirmed that Ghana secured enhanced advantages compared to global lithium deals, welcoming scrutiny to prove this.
Richard Aniagyei, ISD