The Minister for Lands and Natural Resources, Samuel A. Jinapor, has assured Ghanaians that the government will not allow the export of lithium in its raw state.
For this reason, he said the government had included a clause in the lithium agreement between it and Barari DV Ghana Limited to ensure the retention of a significant part of the mining value chain locally.
Addressing a Press Briefing on Ghana’s First Lithium Contract, Terms, Benefits, and the Way Forward on Thursday, December 7, 2023, Jinapor insisted that the Lithium Mining Lease includes provisions for the establishment of a refinery and the provision of the lithium by-products to local industries. Hence, the decision to process lithium locally is in the best interest of the state.
The Minister enlisted significant advantages expected from the implementation of the Lithium deal, disclosing that the execution of the contract will give Ghana 10% in the form of royalties, which will be one of the highest in the country’s mineral exploration history.
He added that the government has also secured a 19 percent state participation in Barari DV Limited, projected to scale up to 30 percent by the end of the contract.
“We have already secured 19 percent state participation in this mining company with the requirement to scale it up to a minimum of Ghanaian participation through listing on the Ghana Stock Exchange for shares to be made available to Ghanaians and Ghanaian entities.”
Jinapor affirmed that the lithium contract is in the ultimate interest of all Ghanaians.
The Chief Executive Officer for Minerals Commission, Mr. Martin Ayisi, pointed out that the critical statements made by some individuals on the deal stem from a lack of thorough reading of the agreement, noting that many of the concerns raised are based on inaccurate assumptions and unsupported assertions.
Mr. Ayisi explained that the $250 million project, located in Ewoyaa, Mfantseman Municipality in the Central Region, is set to commence production by 2025. The deal includes a 10% royalty and 13% free carried interest by the state, surpassing the existing 5% and 10%, respectively, for other mining agreements.
He noted that the Barari DV Ghana Limited is also required to contribute 1% of its revenue to a community development fund for the upliftment of the mining area.
Mr. Edward NanaYaw Koranteng, Chief Executive for Minerals Income Investment Fund (MIIF), spelled out a number of financial benefits to Ghanaians, saying MIIF identified opportunities of undervalued share at the time of closing the transaction with the locked-in price of USD per share, and intrinsic value ranging from USD 1.25 to USD 1.9 per share.
“MIIF has already made a 31% gain in its planned investment in the lithium deal,” he added.
