December 2022
In 2018, Ghana’s gold output of 4.8Moz surpassed South Africa’s 4.1Moz for the first time to make the country Africa’s largest gold producer—a position it has held ever since. Gold production from Ghana is expected to be 4.3Moz in 2022, up 8% from 4.1Moz in 2021.

The increase in production will be driven by Newmont’s Ahafo and Akyem mines, AngloGold Ashanti’s Obuasi and Iduapriem mines. The mines are understood to be continuing to ramp up production this year. The commencement of the Bibiani new mine will also contribute to the increased annual production.

The southern regions of Ghana have been considered one of the world’s most prolific areas for gold discoveries in recent years. One of eight high-priority geophysical targets that have been outlined on the Bibiani Shear Corridor – which was identified by gold production, exploration and development company, Asante Gold. Based on drilling results, an updated Feasibility Study for Bibiani was released in 2018 and included Mineral Resources of 21.7Mt and 3.6g/t of gold.



The Bibiani gold mine has its first gold pour in July this year and declared commercial production in November. According to the company, the development to extend the Bibiani LOM from 8.3 years to +10 years is on track with successful exploration results at Russel South. The mine aims to produce ~175koz of gold in its first 12 months of operation, ramping up to 220kozpa in the second year and 200-255kozpa for years three to eight.

This year, Asante also reached another milestone by acquiring the Chirano gold mine from Kinross Gold. The open-pit and underground operation is located in southwestern Ghana. The company has commenced initiatives to capture synergies between the Bibiani and Chirano mines. The processing plants from the mines are located approximately 15km apart from each other providing opportunity to share infrastructure, minimise operational cost and maximise scalability.


Barriers to Formalisation

Over the years, artisanal and small-scale mining has emerged in Ghana and become a source of revenue and income for poor people living in rural areas, accounting for approximately 40% of the gold produced in the country. However, about 85% of Ghana’s artisanal and small-scale mining operators have no license to operate.

The Ghanaian Government introduced, initially, a framework for the formalisation of small-scale miners more than 30 years ago. However, less than 15% of small-scale mining operators have been able to acquire the requisite mining licences.

There are two problems. The first is that the current formalisation has failed to adapt to the conditions of the majority of local miners. The second is that the schemes make it very difficult or too costly for small-scale miners to comply. There is therefore a disincentive to formalise.

Policy reforms are needed to reclassify Ghana’s artisanal and small-scale mining sector. This would result in more effective control and accountability measures.

The mining sector contributes significantly to the country’s export earnings. The minerals mined in Ghana account for 37% of the country’s total exports, with gold comprising 90% of total mineral exports. The main destination of gold exports from Ghana are Switzerland, United Arab Emirates, India, Turkey, and Australia. The sector contributed a total of US$6.8bn in export earnings in 2020 and US$5.1bn in 2021.


Newmont’s Ahafo to Rule Gold Supply

In 2024, Newmont’s production is expected to increase to 6.4Moz due to the inclusion of profitable production from Ahafo North along with the company’s other advanced projects.

Ahafo North is the best unmined gold deposit in West Africa with approximately 3.5Moz of Reserves and more than 1Moz of Resources and significant upside potential to extend beyond Ahafo North’s current 13-year mine life. The project is expected to add between 275 and 325koz annually for the first five full years of production.

Capital costs is estimated to be between US$750-850m and project completion is expected in 2023. The current LOM plan has recently been extended to 2030 with material mined from open pits. Milling will cease in 2032 after treatment of stockpiled ore.

The full scope will include relocating the national highway and support of additional resettlement activities, mining development for four open pits, constructing and commissioning a 3.7Mtpa plant and constructing a tailings and wastewater management storage facility. Long-lead sourcing will also include the acquisition of 14 Caterpillar 770 haul trucks.

Recent speculative activities on the Newmont Ahafo North project concessional area of Newmont Ghana Gold Limited (NGGL) in the Tano North Municipality of the Ahafo Region has slowed down operations of the gold mining company. However, Newmont is paying a ‘relief support package’ to the speculators and it is about to resume activities at the mine.

The upcoming resumption of the new mine’s development is excellent news for the Ghanaian economy, which is currently suffering a foreign exchange crunch and a lesser, but nevertheless debilitating, fiscal deficit financing crisis.

Newmont’s Africa unit sold 3.5koz of gold to the Bank of Ghana under a central bank domestic gold purchasing program. The gold purchasing programme aims to increase gold reserves and prompted discussions with the Chamber of Mines about the Bank of Ghana's intentions to purchase refined gold from mining companies in the country.

Following the purchase, Newmont became the first mining company to respond to the central bank's initiative with its first sale of refined gold in May 2022. The bank of Ghana is seeking to raise the gold component of its reserves to strengthen the West African country’s local currency without increasing inflation. The move aims to tackle declining foreign currency reserves coupled with demand for dollars by oil importers, which is weakening the local cedi and increasing living costs.



Major Miners Initiatives to Reduce GHG Emissions

Ghana has committed to a conditional target of GHG emissions reduction of 31% below 2015 levels. The country aims to make it possible with the rapid and extensive uptake of renewables to 47-89% of the country’s energy mix by 2040, and close to 100% by 2050.

Renewable energy is an attractive way to reduce reliance on expensive and polluting diesel-powered generators. US gold miner Newmont has started to use a mobile solar power array at its Akyem gold mining operation in Ghana. The company has also signed an agreement with Ghanaian utility Volta River Authority to purchase power from an 8MW solar plant under construction.

AngloGold Ashanti operates the Obuasi and Iduapriem mines in the country. ESG statistics 2021 reported 23kg of emissions per tonne of treated gold ore intensity for Iduapriem and 196kg/t for Obuasi. In order to improve Iduapriem’s mine dewatering performance and sustain operations, the company augmented diesel-powered pumps with a robust, encased electrical submersible pump (ESP) system running continuously on sustainable grid power. The ESP solution removes up to 43,000 bbl/d of water, 51% more than the diesel pumps and reducing carbon intensity of operations.