Global commodity prices have recorded a major dip over the last three years, especially the gold price as it is trading at US$1,107.86 on the international market.
Last year, the country produced a total of 4.4million ounces of gold. Small-scale gold miners produced a total of 1.5 million ounces, which amounts to about 34% of total gold produced. The mining sector contributed 16% of total government revenue.
The country is second-largest producer of gold in Africa and 9th in the world, and has only a few small gold refineries refining gold produced by small-scale miners. Almost 100% of the gold produced from large as well as small-scale producers is exported without value addition.
Speaking with B&FT on wide range of issues in the minerals and mining sector, Dr. Aubynn, confirmed that owing to the fluctuation of global gold prices, the establishment of gold refineries will set the country on a better standing as it is prudent to add value to its precious metal to get real monetary value from it.
Dr. Aubynn added that: “One will buy the metal at low price and add value to it and make some margins, since the price does not affect jewellery prices.
“The gold price is going down globally, so the coming in of these refineries is timely. I think it is good for Ghana, given that the gold price is going down; adding value will actually push the profit up.
“It is exciting and I am happy about the development, because if we build a huge refinery here we may be competing with other established refineries that in a way most of our major producers have links with -- there are some refineries that some mining companies own shares in, so they have some prior arrangement to supply them with some quantities of gold.”
The country is the second-highest gold producing nation in Africa after South Africa, and has attracted major multinational mining companies including Newmont Mining Corporation, Gold Fields Limited, AngloGold Ashanti, Golden Star Resources among others.
These companies export the raw metal for processing overseas due to lack of an in-country refinery.
Government early last year announced its readiness to partner any investor to help establish a gold refinery plant for adding value to the country’s gold.
B&FT has gathered that ASAP VASA Company Limited -- a multi-million dollar high capacity refinery plant, a major gold refinery plant in the country operating and refining 100 kilogrammes of gold daily into granules, coins and bars -- purchases all of its raw gold from licenced small-scale miners and refines them to international quality standards of 99.9% fineness for the local and international gold markets.
Again, last month saw official launch of the Sahara Royal Gold Refinery with the capacity to refine over 200 kilogrammes of gold per day, while there is another refinery yet to come on stream before the end of the year.
Dr. Aubynn said the country’s minerals and mining sector is well-positioned to serve the West African market, and that the advent of these refineries will position the industry as a hub for refining gold in the sub-region.
He urged the companies to focus on their strategies to position themselves to be the West African hub, and these are the targets of the refineries. “The companies want to be able to refine for West Africa, so it is not only Ghana that they are targetting. If things go well it will be good for Ghana.
“Those local refineries should consider and refine produce from the multinational gold mining companies, especially Newmont, Gold Fields among others,” Dr. Aubynn remarked.