MINING ON TOP: AFRICA LONDON SUMMIT 24-26 JUNE, 2014

GHANA MINING ROUND TABLEGHANA MINING ROUND TABLE

HOSTED BYHOSTED BY

HON. ALHAJI INUSAH FUSENI, MPHON. ALHAJI INUSAH FUSENI, MP(MINISTER OF LANDS & NATURAL RESOURCES, GHANA(MINISTER OF LANDS & NATURAL RESOURCES, GHANA))

PRESENTATION OUTLINEPRESENTATION OUTLINEINTRODUCTIONINTRODUCTION

GHANA’S ECONOMYGHANA’S ECONOMY

MINING SECTOR OVERVIEWMINING SECTOR OVERVIEW

THE MINING ENVIRONMENTTHE MINING ENVIRONMENT

INVESTMENT OPPORTUNITIESINVESTMENT OPPORTUNITIES

CONCLUSIONCONCLUSION

• Ghana is a significant gold producer in Africa (second after South Africa) and globally, being the 9th largest producer in the world.

• In 2013, Ghana produced about 4.3 million ounces of gold (134MT), only a marginal decline from the 2012 highest ever production in the history of the country,

INTRODUCTIONINTRODUCTION

GHANA’S ECONOMYGHANA’S ECONOMY• Estimates for 2013 showed real GDP growth rate of 7.4%.

The Services Sector, recorded the highest growth of 9.2%, followed by Industry at 9.1%;

• The Services sector remains the largest with a share of 50.6 percent of GDP, followed by Industry at 28.1% and Agriculture 21.3%.

• In terms of growth, the Petroleum and Mining sub sectors recorded 37.5% and 17.6% respectively, Construction and Electricity subsectors recorded 13.3% and 8.4% respectively in the Industry Sector, while, Manufacturing grew by 2.5 %, and Water by 2.4 %.

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MAJOR EXPLORATION AND MINING COMPANIES MAJOR EXPLORATION AND MINING COMPANIES OPERATING IN GHANAOPERATING IN GHANA

SECTOR PERFORMANCE – Key Facts (1)SECTOR PERFORMANCE – Key Facts (1)

• Some US$ 13.7 billion invested in mining sector (1983-2012)

• As of December 2013, 235 Local and Foreign companies held Prospecting/Reconnaissance licenses.

– Locals (Ghanaian Controlled): 184 (78.3%)184 (78.3%)– Foreign Controlled: 51 (21.7%)(21.7%)

• Many of the companies holding exploration licences focused on gold exploration.

• Thirteen (13) Large Scale Mines were in production.

SECTOR PERFORMANCE – Key Facts (2)SECTOR PERFORMANCE – Key Facts (2)

SECTOR PERFORMANCE – INVESTMENT INFLOWS (3)SECTOR PERFORMANCE – INVESTMENT INFLOWS (3)

SECTOR PERFORMANCE – Key Facts (4)SECTOR PERFORMANCE – Key Facts (4)

CONTRIBUTION TO TOTAL MERCHANDISE EXPORTS BY KEY SECTORSCONTRIBUTION TO TOTAL MERCHANDISE EXPORTS BY KEY SECTORSSECTOR PERFORMANCE – Key Facts (5)SECTOR PERFORMANCE – Key Facts (5)

• The significant investment over the years and consequently mineral outputs led to an increased sector contribution to the economy of:

27% of Government revenue as collected by the Domestic Tax Division of GRA in 2012. 19% in 2013 19% in 2013 (fall due to decline in gold price)(fall due to decline in gold price)

• Average 40% % of total merchandise export earnings merchandise export earnings over last 10 yrsover last 10 yrs.

Employed 28,000 for large scale and estimated over 1 million people for small scale mining.

SECTOR PERFORMANCE – Key Facts (6)SECTOR PERFORMANCE – Key Facts (6)

The Achievements are mainly attributed to:• Political Stability: Ghana can boast of some 22 years of

multi-party democracy which has been lauded internationally;

• Availability of geo-scientific data: For the first time, total coverage of airborne data (magnetic and radiometrics) is now available in the country. Indeed some areas have also been covered with gravity and Electromagnetic data. The geological map covering the whole country has also been updated;

THE MINING ENVIRONMENT (1)THE MINING ENVIRONMENT (1)

The Achievements are mainly attributed to:• Favourable Fiscal Regime: Ghana operates an attractive

legal and fiscal regime in line with international best practices; and

• Governance Improvement: Government has created a stable regulatory environment that provides for transparent and even-handed treatment of all investors.

THE MINING ENVIRONMENT (2)THE MINING ENVIRONMENT (2)

Prospects for Gold & Value AdditionProspects for Gold & Value Addition Gold

In addition to the 11 operating gold mines in the country, 265 gold reconnaissance and prospecting licences had been issued by Government to both Ghanaian and foreign entrepreneurs.

Some of these companies have advanced in their exploration and there are opportunities for investors to enter into Joint Venture (JV) arrangements with these companies to develop the resources.

Gold Refinery and Value Added Products Ghana produces over 4.3 million ounces of gold per

annum. Setting up a refinery could serve other gold producers in the sub region.

Bauxite and Iron Ore DepositsBauxite and Iron Ore Deposits

Integrated Bauxite-Alumina Industry526 million tonnes with about 160 million tonnes of

contained aluminium.

Deposits: Kibi, Nyinahin

Iron and Steel Development

Opon-Mansi lateritic iron deposit;

Shieni sedimentary iron deposit; and

Pudo titaniferous-magnetite deposit

Solar Salt & Chlor-Alkali IndustrySolar Salt & Chlor-Alkali Industry

Solar Salt Along its 500km coastline, Ghana possesses one of the

largest proven renewable solar salt production potential in West Africa, which could supply the needs of the entire sub-region. After investigations, Salt Landbanks will be made available to investors.

Chlor— Alkali Industry Potential exist for the utilisation of part of the salt to produce caustic soda which is a raw material for the soap and detergent industry; and bauxite/alumina production. The chlorine co-product can also be used as water treatment chemical and also serve as raw materials for the production of various health and sanitation chemicals.

Industrial MineralsIndustrial Minerals

Industrial MineralsGhana is also endowed with industrial mineral deposits such as: feldspar, kaolin, silica sand and granite.

Government policy is to diversify the mineral resources base from the traditional minerals and it is expected that the exploitation of industrial minerals would promote effective linkages with other sectors of the economy, to reduce current over reliance on imported substitutes.

Service and Engineering SectorService and Engineering Sector

• There are several service companies in Ghana, providing support services including: contract drilling, assay laboratories, contract mining and geological consultancies to mining companies.

• Using Ghana as a base, these companies have ventured and expanded their activities into the West African sub-region. Government has through incentives encouraged such companies.

• Investment opportunities exist for investors to set up plants for producing inputs and machinery for the mining industry.

OTHERS:

–Decorative & Semi-Precious Stones–Base Metals & Other Mineral Potential–Infrastructure Development–Linkage & Multiplier Opportunities

INVESTMENT OPPORTUNITIESINVESTMENT OPPORTUNITIES

• Availability of database to assist investors looking for open grounds i.e. Geographic Information System (GIS) based mineral title cadastre.

• Searches for open grounds are conducted electronically and timeously (maximum 10 minutes)

• Priority to mineral applications that are first in time i.e., on first come, first considered basis

• A Block cadastral system has been introduced to improve and streamline procedures for acquisition of mineral rights, prevent conflicts and will shorten the time used in the processing of mineral right applications

IMPROVED SYSTEMSIMPROVED SYSTEMS

• Available currently are up to date mineral related information in the form of publications, concession maps, spatial geophysical and geological data (airborne geophysical coverage maps, geological maps showing various units and belts, etc.), which serves as ready information to investors.

• A new mining portal (www.ghana-mining.org) has been created to make information readily available to investors

IMPROVED SYSTEMSIMPROVED SYSTEMS

In conclusion, it is significant to note that:In conclusion, it is significant to note that:

• Ghana, though quite a matured mining economy,– still has broad-based mineral sector investment still has broad-based mineral sector investment

opportunitiesopportunities; and– has a well structured investment regime which is supportive has a well structured investment regime which is supportive

of investment,of investment, on a win win basis;

• Ghana therefore welcomes investors to partner Government to undertake mineral related activities that would catalyse wider Sustainable Development.

Conclusions

GHANA: GREAT NATION, GHANA: GREAT NATION, HAPPY PEOPLEHAPPY PEOPLE