The Ghana Chamber of Mines is calling on government to exempt exploration companies from paying VAT on big ticket cost items such as drilling and laboratory services, to prevent dwindling investments in the industry.
“Effectively, the extent of actual exploration activity is diminished by upfront costs such as VAT on input and landholding costs. Thus, relieving the usually illiquid exploration companies from the payment of VAT as well as reducing the cost of landholding would not only improve their cash flow and reduce their operational costs but also enhance Ghana’s image as competitive destination for exploration investment”, it said.
Ghana has dropped to 4th in terms of budget for gold exploration on the continent.
Whilst, the budgetary allocation to Mali for gold exploration projects increased from $91.9m in 2019 to $94.6 million in 2020, that of Ghana fell from US$98.6 million to $84.6 million in the same period.
President of the Ghana Chamber of Mines, Eric Asubonteng says incentives for exploration activities will guarantee continuous mineral production and flow of fiscal and forex receipts as well as other benefits from the minerals sector.
Distribution of budgets for gold exploration projects in Africa
|Country||Budget (US$)||Share of Africa budget||Rank in Africa|
Meanwhile, Gold Fields was the top gold producing company in the country in 2020, generating a little above 500,000 ounces of gold.
It was followed by Newmont Gold Ghana Limited (450,000) in 2nd, Newmont Golden Ridge Limited (370,000) in 3rd and the AngloGold Ashanti Iduapreim in the Western region in 4th position with production of about 260,000 ounces of gold.
Top gold producing firms in Ghana in 2020
Gold Fields – 1st
Newmont Gold Ghana Limited -2nd
Newmont Golden Ridge Limited -3rd
AngloGold Ashanti Iduapreim -4th
Asanko Gold Mine -5th
Abosso Gold Fields Golden Star Wassa -6th
Chirano Gold Mines -7th
Perseus Mining -8th
AngloGold Ashanti Obuasi mines -9th