Government Takes Over Damang Mine Following Expiry of Gold Fields’ Mining Lease
The Government of Ghana, through the Ministry of Lands and Natural Resources and the Minerals Commission, will assume full operational control of the Damang Mine from Saturday, April 19, 2025, following the expiration of the 30-year mining lease held by Abosso Gold Fields Limited (AGL), a subsidiary of Gold Fields Limited.
AGL’s bid to renew the lease was unsuccessful, culminating in the state’s decision to take over the mine in line with Section 23 of the Minerals and Mining Act, 2006 (Act 703). The takeover forms part of a broader government policy shift aimed at maximizing national benefit from mineral resources and ensuring transparency in the renewal of mining licenses.
“The Damang Mine’s return to state oversight marks a critical step in Ghana’s economic reset, ensuring its gold reserves directly benefit citizens and fuel long-term prosperity,” said Minister for Lands and Natural Resources, Armah Kofi Buah, in a press release issued on Wednesday, April 17.
The Minister emphasized that the decision was not arbitrary, but rather grounded in clear legal and technical justifications, highlighting AGL’s failure to meet the minimum requirements stipulated by the Minerals Commission for lease renewal.
Three Key Reasons Behind Lease Rejection
The Ministry cited three major lapses by AGL in its renewal application:
Failure to Declare Mineral Reserves: AGL did not declare verifiable mineral reserves in its application, a fundamental requirement under Regulation 189 of L.I. 2176. Without stated reserves, the Minerals Commission could not justify recommending a lease extension. The company’s 2024 Annual Reports, published after it was served with a notice of rejection, confirmed the absence of such reserves.
Lack of a Technical Program: The company failed to provide a detailed program of past and future mining operations, impeding the government’s ability to evaluate the mine’s historic and projected performance.
No Budget for Exploration: Gold Fields made no budgetary allocations for exploration activities at Damang over the past two years, raising concerns about the company’s commitment to future mining and sustainable operations.
Smooth Transition Assured
The government has outlined a framework to ensure a seamless transition with a strong emphasis on local participation and protection of existing jobs and contracts.
Key elements of the transition plan include:
Operational Continuity: All current employees, contractors, and service providers will maintain their roles, with valid contracts honored and operations continuing uninterrupted.
Local Content Focus: Priority will be given to employing local workers and sourcing from businesses within the Damang catchment area, in line with Ghana’s Local Content Policy.
Stakeholder Engagement: A transition team will engage all stakeholders including workers, contractors, and traditional authorities, to ensure transparency and address concerns.
Security Assurance: The government pledged to uphold safety protocols and protect all assets at the site, warning that disruptions or unauthorized access will not be tolerated.
“This is a moment of collective resolve. The next chapter of the Damang Mine will be written with Ghanaian hands for Ghanaian benefit,” said Mr Buah.
He further assured the international investment community of Ghana’s continued commitment to maintaining a responsible, stable, and investor-friendly environment.
“While we remain open to collaboration with foreign investors, we are clear on the need to balance interests with the long-term needs of our people,” he said.
The Damang Mine, which ceased active mining in 2023 and moved to stockpile processing in 2024, had a projected Life of Mine of one year as of its last filing by Gold Fields.
The Minister concluded by calling for unity and cooperation as the country embarks on this new chapter in the management of its mineral resources.
