The Ghana Chamber of Mines is warning of imminent drawback of investment in the mining sector if the frequent incursions into mining concessions by illegal mining operators are not curtailed.
The chamber said recent incursions into the company’s mines area had scared away potential investors that Anglogold urgently required to fix the Obuasi mines.
The Chief Executive Officer (CEO) of the chamber, Mr Sulemanu Koney, said other mining concessions that had witnessed mass invasions were the Owere mines and Persus at Ayamfuri. Last Monday, about 400 illegal miners from 17 communities were alleged to have taken over part of the concession of the Owere mines in the Asante Akyem Central Municipality in the Ashanti Region.
The angry illegal miners, who wielded dangerous weapons, including machetes and guns, were said to have overpowered the mine’s security and a team from the national security to take total control of the facility.
The invasion followed a December 31, 2015 ultimatum given by the youth to have the concession given back to the indigenes or face their wrath.
Chamber of Mines campaign
Through the Chamber of Mines the mining industry in the country entered into an agreement with the government to provide ongoing security support to supplement the mining company’s efforts to secure property and mining leases.
On January 13, incursions into the northern part of AngloGold’s Obuasi operating footprint were turned back by security forces.
The Ghana Chamber of Mines is urging the government to urgently turn its attention to the perennial incidence of illegal miners invading concessions of large-scale mining companies, particularly during election years. The situation has arisen again with the advent of illegal miners encroaching the bona fide concessions of large-scale mining companies.
“The country stands to lose heavily if the activities of the illegal miners are allowed to fester ahead of the election in November 2016.”
“There is clear danger to our environment and to Ghana’s economy as illegal miners fight large-scale mining companies for concessions the latter have obtained legally. This in itself breeds a sense of insecurity and fear among investors, which will cause a slowdown in investment in the country’s minerals sectors,” says Mr Koney.
He said all the efforts instituted by the Minerals Commission complemented by that of the chamber to attract investment into the minerals sector would come to naught if the government does not put in place security measures to prevent an imminent loss of investor confidence in the country with its attendant risk of some companies cutting investments.
This incursion of several hundred illegal miners in the northern part of the mine comes against the background of illegal mining causing considerable disruption to mining operations across Ghana for some time.
The biggest problem the chamber, however, faces is the depleting quality of the mined ore from its deep underground resources, which, though is above grade six, involves higher production cost and less profitability in processing, Mr Koney said.
Withdrawal of non-critical staff
As a consequence, AngloGold has removed all non-critical staff from the mine while keeping government stakeholders updated and engaging with the authorities at the highest levels for the re-establishment of law and order and the removing of illegal miners from the site.
At the same time, the company is undertaking a feasibility study to redevelop the stalled Obuasi, which involves refocusing its efforts on decreasing upfront redevelopment capital, cutting operating costs and improving recoveries based on recent test work and engineering – work that it expects to complete by mid-year.
The environmental review process for the mine’s redevelopment, which is being undertaken in conjunction with Ghana’s environmental protection agency, will likely extend into the second half of this year.