Dr. Kwabena Donkor, former Chairman of Parliament’s Energy and Mines Committee, has proposed a new ownership model for Ghana’s mining sector. This model seeks to allow the state to maintain ownership of mining assets while contracting indigenous companies to undertake operational activities. Dr. Donkor argues this approach will enable Ghana to retain a greater share of the benefits from its mineral resources.
He triggered this proposal due to a belief that Ghana possesses the technical expertise, managerial capacity, and local business ecosystem to retain more value. This framework specifically aims to reduce the financial outflows associated with foreign ownership structures, such as dividend payments. The proposed changes would primarily affect large-scale gold mining operations, potentially redirecting hundreds of millions of dollars back into the Ghanaian economy.
This initiative aligns with Ghana’s ongoing efforts to maximise the value derived from its natural resources without resorting to outright nationalisation. Ghana has a long history of seeking better terms from its resource exploitation. Past policies have included local content requirements and increased royalty rates. This proposal could significantly alter the financial landscape for both state and private entities in the mining sector.
Dr. Donkor strongly recommends reviving the State Gold Mining Corporation (SGMC) in a limited capacity. The SGMC would act solely as an asset-holding entity. He stated, “I strongly recommend that the State Gold Mining Corporation be revived, but in a limited capacity as an asset owner rather than an operator.” He clarified this is not a return to past state-run mining, which had poor performance.
The implications of this model are significant for Ghana’s financial landscape and its position in global mining. If adopted, it could lead to increased domestic capital retention and boost the capacity of local mining firms. Decision-makers in government will need to carefully assess the economic feasibility and legal frameworks for such a transition. The model draws parallels to existing practices where foreign firms own assets but use local contractors, as seen at the Tarkwa Mine.
Dr. Donkor cited the Tarkwa Mine as an example where foreign firms own assets but use local contractors for operations. He noted, “This is consistent with current practice. Gold Fields handles the administration and ownership, while the actual mining operations are undertaken by subcontractors. The Ghanaian state can adopt the same model.” He believes Ghana's mining industry has matured, justifying this new ownership structure.
He highlighted that expatriate participation in large-scale mining has significantly declined. Most engineers, geologists, metallurgists, and mine managers are now Ghanaians. Dr. Donkor described Ghana as a net exporter of mining expertise. Ghanaian professionals are increasingly recruited by mining companies in Australia and Canada, indicating strong local capabilities.
Dr. Donkor argued that the key challenge is no longer operational capability but ownership and value retention. He warned against nationalisation, stressing its potential serious economic consequences. He clarified that reassessing ownership when mining leases expire, such as the Tarkwa Mine lease expiring next year, does not constitute nationalisation. He believes local operators can raise capital through various financial institutions, supported by state guarantees and future gold production.