New gold refinery opens - Vice-President demands responsible gold sourcing
The first gold refinery in which the state holds a stake has been commissioned to facilitate a new vision of adding value to a significant portion of the country’s gold.
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With capacity to refine 400 kilogrammes of dore gold (raw gold) per day or 132 tonnes of 24 carat, 99.99 per cent pure gold annually, the Royal Ghana Gold Refinery (RGGR) can process the entire volume of the gold exported from Ghana within 300 working days and process others from neighbouring countries.
It is a public, private partnership (PPP) between the Bank of Ghana, which took over the stake of Precious Minerals Marketing Company (PMMC), and Rosy Royal Minerals Limited.
The Vice-President, Dr Mahamudu Bawumia, who launched the refinery on the premises of the PMMC in Accra yesterday, said its establishment was a strategic investment which contributed immensely to the effort of the government in ensuring value addition of the mineral resources of the country.
The Vice-President called on players in the industry to feed the refinery with gold that is sourced responsibly.
He explained that responsibly sourced gold was extracted legally with due regard to the environment and devoid of conflict, human rights abuse and or child labour.
Dr Bawumia said the current issues of illegal mining posed a big threat to the value addition efforts of the country as it had a real potential of tainting the gold dore which would be fed into the refinery.
That, he said, made it difficult to meet the responsible sourcing requirement, and by extension, the ability to operate with international certification, that of the London Bullion Market Association (LBMA).
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“This is why the Royal Ghana Gold Refinery must ensure that its entire feedstock is responsibly sourced”.
“There is, therefore, a compelling reason, more than ever, to ensure that we nip the menace of galamsey in the bud to ensure responsible mining and safeguard our environment and water bodies,” the Vice-President emphasised.
Background
The refinery which began in 2018, when the Precious Minerals Marketing Company (PMMC) granted part of its land for its construction, was completed in 2022.
It is equipped with cutting-edge technology that meets international standards and is expected to significantly boost the capacity to locally process gold and increase value addition prospects.
Currently, Ghana exports its gold in dore form to be refined outside and according to Dr Bawumia, that resulted in loss of revenue and missed opportunities for job creation.
Between 2018 and 2023, the Vice-President pointed out, the average annual gold production in Ghana was 3.92 million ounces or 122.5 tonnes, all of which were exported unrefined.
Adequate capacity
Dr Bawumia said the refinery had adequate capacity to meet the needs of the country as well as surrounding gold producing countries.
“It is my expectation that our domestic mines will be fully on board and make this refinery their first port of call. With that kind of support, RGGL can obtain the London Bullion Market Association (LBMA) good delivery list accreditation in three years, making it the second of such refinery in Africa,” he said.
He added that the refinery was a stepping stone towards setting gold from the country on the global market, making it a gold hub. “RGGR symbolises our determination to harness our mineral resources for the maximum benefit of all Ghanaians,” Dr Bawumia said.
He, therefore, urged all to strive for excellence, innovation and sustainable economic development while ensuring responsible extraction of our mineral resources.
Jobs
Dr Bawumia said the refinery was initially expected to create 80 to 120 direct jobs and another 500 indirect employment opportunities, boosting domestic tax revenue in the form of corporate taxes and enabling the country to refine gold to 24 carats, 99.99 per cent purity - same quality as a good delivery bar (LBMA standard) — and offer premium to gold exported from Ghana.
He said this historic achievement in the natural resources sector, specifically in gold, marked a significant milestone in the journey of the country towards economic transformation and industrialisation.
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With the ability to locally refine the gold of Ghana, Vice-President Bawumia said: “We will be able to sell the refined gold at its appropriate price, enabling us to retain its economic value within our borders while creating numerous job opportunities for the youth.”
In addition, he said, the intention of the government to refine all gold produced in Ghana would further enhance the economic independence and resilience of the country.
Gold Purchase programme
Touching on the gold purchase programme of BoG which began in 2021, Dr Bawumia said the programme and the refinery were positioning Ghana as the gold hub of Africa.
In that regard, he said, it marked a new era for the country and ushered the country into its vision of building a resilient economy anchored on the mineral resources of the country in a golden age of natural resource governance.
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Importance
Underscoring the importance of the project, the Minister of Finance, Dr Mohammed Amin Adam, said the project was of the utmost importance to the country's growth and structural development.
Going by numbers, he said, the minerals and mining quarrying sector was the most significant contributor to direct domestic taxes mobilised by the Ghana Revenue Authority (GRA) in 2023, with fiscal payments amounting to GH¢11.6 billion, representing 22.7 per cent of aggregate direct domestic tax receipts.
Dr Amin Adam cited Ghana Chamber of Mines data that since 2004, gold had contributed approximately 96 per cent of the country’s significant mineral export revenue.
The Finance Minister said although gold was a cornerstone of the economy, the failure to successfully ensure value addition across the entire resource chain had meant “we have been unable to properly harness the benefits of being among the top 10 gold producers in the world”.
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Dr Amin Adam added that the commissioning of the gold refinery marked a pivotal moment in the country’s journey towards economic independence as it ensured that the value addition of gold happened domestically.
Leading gold producer
The Minister of Lands and Natural Resources, Samuel A. Jinapor, commended Dr Bawumia for leading the efforts for the establishment of this refinery and said the Vice-President had been at the forefront of policies aimed at ensuring optimal benefits from the mineral resources of the country.
He said even though the country was overtaken by South Africa, it had by dint of hard work, not only regained its position as the leading producer of gold in Africa, since 2021 but had also revamped dormant mines such as the Obuasi and Bibiani mines.
Currently, Mr Jinapor said three large-scale gold mining operations were under construction by Newmont in the Ahafo Region, Azumah Resources in the Upper West Region and Cardinal Namdini in the Upper East Region.
Mr Jinapor said those mines, as well as the expansion of existing ones, would ensure that the country remained on top of gold production for the foreseeable future.
The Governor of the Bank of Ghana, Dr Ernest Addison, congratulated the board, management, and staff of RGGL on their achievement and said their hard work and dedication had paid off.
“Let us work together to promote the growth of our gold industry, add value to our natural resources, and build a prosperous future for our nation,” he added.