Tuesday, June 15, 2021

Ghana Records Major Drop in Gold Production in 16 years

Gold bars

Accra, Ghana//-Ghana recorded the major drop in gold production in 16 years, the Ghana Chamber of Mines has disclosed.

The country’s gold production dropped 12.1 per cent to 4.02 million ounces in 2020 compared with 4.57 million ounces in 2019,

The President of the Ghana Chamber of Mines, Eric Asubonteng, who disclosed at the virtual 93rd Annual General Meeting (AGM) of the Chamber, noted that the decline in production in 2020 was the biggest since 2004.

Causes the decline

He attributed the decline in Ghana’s production to a combination of domestic issues and COVID-19-related factors.

The performance of Ghana’s minerals sector was muted in 2020 compared to the preceding year. The total volume of gold produced in-country declined from 4.577 million ounces in 2019 to 4.023 million ounces in 2020”.

Still hold on…

But Ghana continued to hold on to its position as the largest producer of gold in Africa and the sixth in the world, the country recorded a decline in output by 12.1 per cent.

Ghana’s closest rival and long-term leading producer, South Africa, also recorded a 13.7 per cent decline in production at 91 tonnes and remained in second place on the continent and tenth globally.

The fall in South Africa’s gold production was mainly due to structural problems related to declining grades, curtailment in the supply of electricity and the high cost of accessing ore bodies in deep mines. Africa’s production accounted for 21 per cent of global mine production in 2020, according to S&P.

It was not all gloomy

Mr Asubonteng said: “It was not all gloomy on the continent, as Ghana’s West Africa neighbours, Burkina Faso, recorded a 19 per cent increase in production to 74 tonnes on the back of increased production levels by that country’s leading gold producers”.

While Ghana’s large-scale sub-sector dropped by 4.8 per cent to 2.847 million ounces in 2020, the small-scale sector fell by 26 per cent from 1.588 million ounces in 2019 to 1.175 million ounces in 2020.

However on a positive note was the commencement of production at the Obuasi Mine of AngloGold Ashanti and growth in the output at Gold Fields’ operations as well as the Wassa Mine of Golden Star Resources, according to Mr Asubonteng.

Other minerals’ performance

In a marked departure from past years, the volume of manganese produced by Ghana’s sole producer, Ghana Manganese Company, declined from 5.383 million tonnes in 2019 to 2.358 million tonnes in 2020.

The 56.2 per cent drop in production was primarily due to the government’s directive to stop the company’s operation in the year under review, resulting in the suspension of manganese production in the first quarter of 2020, the Chamber President explained.

For diamonds, Mr Asubonteng noted that the downward trend in the purchases continued unabated due to the suspension of production by the only large-scale producer, Great Consolidated Diamond Company.

“In essence, diamond purchases in 2020 reduced by 25.1 per cent to 25,292 carats from 33,789 carats in 2019.  Additionally, Ghana’s sole producer of bauxite, the Ghana Bauxite Company, recorded a 4.1 per cent improvement in its output.

The expansion in the shipment of bauxite from 1.116 million tonnes in 2019 to 1.162 million tonnes in 2020 was principally due to an improvement in its operational activities”.

Exploration expenditure in Africa

In terms of exploration expenditure in Africa, planned investments in gold exploration projects took a dip to $590 million in 2020 compared to the $615.9 million in 2019.

Ghana dropped from second position to fourth in 2020 behind its West Africa counterparts – Cote D’Ivoire, Burkina Faso and Mali – in planned exploration expenditure on account of a significant increase in budgetary allocation for exploration in Cote D’Ivoire and Mali.

Cote D’Ivoire’s planned expenditure stood at $105 million in 2020 displacing Burkina Faso as the largest recipient of gold exploration capital in Africa.

African Eye Report





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