In a significant development for Ghana’s mining industry and its contribution to the global green energy transition, the government has granted Barari DV Ghana Limited, a subsidiary of Atlantic Lithium Limited, a 15-year mining lease to commence lithium mining in the Mfantseman Municipality of the Central Region.
This decision reflects the country’s commitment to ensuring optimal benefit from its mineral resources while aligning with global efforts to combat climate change.
The newly granted mining lease incorporates a range of new and improved terms designed to secure the nation’s interests.
Notably, these include an increase in the royalty rate, enhanced state and Ghanaian participation, and a focus on value addition to the extracted mineral.
This milestone follows extensive prospecting and feasibility studies conducted by Barari DV Ghana Limited, as well as a series of negotiations between the company and the government.
The mining lease spans an area of approximately 42.63 square kilometers, granting the company exclusive rights to mine lithium and associated minerals in compliance with the country’s mining laws.
Lithium, a critical component in lithium-ion batteries, is pivotal to the global push for green energy solutions as an alternative to fossil fuels.
With the pressing need to reduce carbon emissions, there is a growing market for battery production and the minerals required for these batteries, known as “green minerals” or “critical minerals.”
Currently, African countries that mine lithium often export the raw mineral, missing out on value addition opportunities.
Barari DV Ghana Limited embarked on lithium exploration in Ghana in 2017, and its efforts resulted in the discovery of high-grade lithium deposits in Ewoyaa.
Geological surveys indicate the presence of lithium deposits in various parts of the country, offering potential for significant economic development.
The Minister for Lands and Natural Resources, Samuel A. Jinapor, highlighted that the government’s approach to lithium mining differs from its treatment of other minerals.
Specific policies were developed to ensure that Ghana benefits optimally from the exploitation and management of green minerals. The mining lease granted to Barari DV Ghana Limited incorporates these policy guidelines.
Among the key terms agreed upon, the royalty rate has been increased from the standard 5% to 10%, and the state’s free carried interest in the mining operation has been raised from 10% to 13%.
The Minerals Income Investment Fund (MIIF) will also acquire an additional 6% in the mining operation, along with a 3.06% stake in the company’s parent entity listed on the Australian and London Stock Exchanges.
Furthermore, the company is required to list on the Ghana Stock Exchange, enabling Ghanaian entities and individuals to participate in the venture.
In line with the commitment to community development and environmental sustainability, the company will contribute 1% of its revenue to a Community Development Fund. Additionally, plans are in place to establish a chemical plant for lithium processing, creating job opportunities and fostering development in mining communities.
The Minister emphasized the government’s dedication to ensuring that mining communities and Ghanaian citizens, who are the rightful owners of these minerals, reap the benefits of responsible and sustainable mining practices.
He urged the company to adhere to all relevant laws and agreements, ensuring ethical and environmentally responsible mining activities.
The Executive Chairman of Atlantic Lithium Limited, Mr. Niel Herbert, expressed gratitude for the cooperation of the government in reaching this milestone.
He emphasized the significance of the Ewoyaa project and pledged the company’s commitment to adhere to Ghana’s laws and create a safe mining environment for the effective exploitation of this valuable resource for the benefit of all Ghanaians.