Business News of Wednesday, 26 September 2018
It has emerged that Golden Star Prestea Mine in the Western Region, has not paid dividends to government over a period of ten years.
Ahmed-Salim Adam, acting Manager of the company, explained that they have not been making profit for several years due to a myriad of challenges.
The Government of Ghana owns 10 per cent of the company, while Golden Star Resources owns 90 per cent.
The Lands and Natural Resources Minister, Kweku Asomah-Cheremeh, who is currently on a working visit to some mining sites in the region, said his outfit will soon audit mining companies to get to the bottom of some of these issues.
Ahmed-Salim Adam blamed the company’s failure to fully oblige to this requirement on power challenges in the last quarter of 2016.
“We weren’t making it because gold prices dropped significantly. Also, we had very unstable power and the refractive plant was using bacteria and microorganisms to extract the gold. It was sensitive to power, so if you lose power for two hours, you lose production for 2 weeks.”
“In fact, at a stage, we had to ration power. It affected us significantly because of the technology we were using. The technology was very sensitive to power fluctuations and we didn’t have adequate backup power. So three years ago, we decided to shut down. Those periods were loss-making periods for the organization”, he disclosed.
Historically, the Golden Star Prestea Mine has over the years engaged in surface mining but has transitioned to underground mining.
Since its operations, the company has pumped 479 million dollars into Ghana’s economy through taxes and royalties paid to the government. Government has been concerned about how to maximize revenue from gold mining firms
In 2017 alone, the government received 46 million dollars in the form of royalties and taxes.
The company is currently embarking on some expansion drive, and it is spending close to 2.8 million dollars on exploration.
Apart from this economic contribution to the country’s development, Golden Star Prestea Mine has also integrated the 2030 Agenda for Sustainable Development into its projects and programs.
Measures being taken by the lands ministry
The Ministry of Lands and Natural Resources is set to roll out an operational audit system for all mining companies in the country.
The move, according to the ministry, is to ensure that revenue received by government from the country’s mining industry is accurate.
Reiterating government’s commitment to go ahead with the plan, sector minister, Kweku Asoma Cheremeh, said mining companies who fall foul to the laws will be dealt with.
“We will dialogue and digest the problems that they have. If indeed the problems are genuine and for that matter they should not pay, we will understand. But where they seek to cover up and they wouldn’t to declare dividends honestly for us to know that we are entitled 13 million dollars, we will take it up.”