Delay in ratifying lithium and bauxite agreement and concerns of chiefs and people 

By: Kingsley Nana Buadu 

Two paramount Chiefs in the Central Region where Lithium deposit is found in larger quantities have expressed worry over what they described as the delay in the approval of the lithium and bauxite mining agreement in parliament.

According to them, the found mineral in the area is a major breakthrough for the development of their people giving the lack of employment and development in the areas. 

They have therefore pleaded with parliament , the Minerals Commission and other stakeholders to look beyond party politics and rather do the necessary due diligence and fast track the process of approving the mining license for the companies to begin full operation as soon as practicable.

BARARI DV Limited, a subsidiary of Atlantic Lithium Limited commenced exploration for Lithium in the country in 2017 and discovered high grade lithium in commercial quantities in Ewoyaa in the Mfantsiman Municipal and other districts of the central region.

In October 2023, government of Ghana granted BARARI DV, a fifteen year mining lease to commence the construction and mining of Lithium at Ewoyaa in central region.

According to the Ministry of Lands and Natural Resources , the lease incorporates new and enhanced terms intended to ensure that the country benefits, optimally from this mineral. These include increase in royalty rate, state and Ghanaian participation (Local Content) as well as value addition to the mineral mined. 

Granting of the mining lease follows the completion of prospecting and feasibility studies by the company as well as series of negotiations between government and the company.

The lease covers an initial area of approximately 42.63 square kilometers.

The Environmental Protection Agency in February, 2024 held a public hearing at Ewoyaa where the Environmental Scooping Report was presented and the concerns of the concerns of the about ten communities solicited. 

On the 27th of June, 2024 another public hearing Environmental Impact Statement was also organized at Akrofu, where further concerns were raised by the communities for redress.

Prominent on their issue list are the need for the company to pay appropriate compensations for the farm lands that are being released for the project. 

They also demanded that health facilities be put up in the communities before the operation begins. Concerns over employment for the youth, construction of their road networks and improving telecommunication network in the areas were all raised. 

Lithium is one of the main substitute for fossil fuels being promoted for the energy transition.

 It is the main mineral used in the production of Lithium-ion batteries for many electrical and electronic gadgets and machines including especially electric vehicles which is consciously being promoted across the globe to take over fossil fuel vehicles. This has already began in many European countries .

In early July 2024, the lithium and bauxite mining agreements were laid before the parliament of Ghana for consideration and approval but unfortunately the law makers could not ratify the bill.  

They cited lack of transparency surrounding the agreement and the fact that the house did not form quorum to consider such important agreement at the time. 

However, two paramount chiefs in the area, Okogyeeman Okese Essandoh IX , Omanhene of Nkusukum Traditional Area of Yamonransa and the Omanhene of Abura Traditional Area of Abakrampa, Emintsiminim Otu, are concerned about what they described as delay in passing the bill which is subsequently delaying the granting of license to ensure full operation by the companies. 

According to the paramount chief of Nkusukum, Okogyeeman Okese Essandoh, their fear stems from the fact that another energy transition fuel (Hydrogen Fuel ) which is also being promoted currently may compete with the lithium and reduce it current extreme importance in the world market.

“The delay would not help us so I am pleading with our parliamentarians to look beyond politics and look at Ghana first” he pleaded. 

“We have learnt that there is this hydrogen fuel which is also coming on board, so the lithium mining which aims at fueling our electric cars, should thus hydrogen fuel comes on board, it would mean that lithium would not be of value” he further noted. 

According to him, the mineral (lithium) is already losing it price value in the world market each and every day, hence the delay would not help. 

 Per the agreement, government and the people of Ghana stand to benefit royalty rate of ten (10) per cent an increase from the previous mineral agreement of five (5) per cent. The state’s free carried interest now is Thirteen (13) per cent instead of the previous ten (10) per cent. 

Government, in addition through the Minerals Income Investment Fund (MIIF) will acquire Six (6) per cent in mining operations and 3.06 per cent in the company’s parent entity which is listed on the Australian and London Stock Exchange. 

The company agreed to further pay one (1) per cent of its revenue into a Community Development Fund to be utilized for development (Establishment of Industry) for the area. 

The Omanhene of Abura Traditional Area, Emintsiminim Otu, lauded the inclusion of the one per cent development fund into the agreement which he described a novelty. 

 According to him, they would continue to do everything possible to ensure that their people are not short changed, and that they would derive the most benefit from the resource. 

“The one percent community development fund in the BARARI agreement is a significant benefit that provides several advantages to the local communities affected by mining operations” he noted. 

More Stories Here