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Business & Finance | Nov 3, 2004

Goldfields pays 31 billion cedis dividend to government

GNA

Accra, Nov. 3, GNA - Goldfields (Ghana) Limited (GGL), which operates the Tarkwa and Abosso Mines, this year paid a total of 31.5 billion cedis (3.5 million US dollars) in dividend to the government. This brings dividend the company has paid to government since 2001 to about 60 billion (6.5 million US dollars).

Mrs. Cecilia Bannerman, Minister of Mines, said this at a dinner on Tuesday, organized by GGL, a subsidiary of South African-based GoldFields Limited, to mark the commissioning of its new 160 million-dollar SAG Mill and Carbon-in-Leach (CIL) Plant, which is expected to increase the company's gold recovery rate from the current 70 per cent to 96 per cent.

The SAG Mill and CIL Plant, sited at the Tarkwa Mines, makes several receptacles containing different chemicals like cyanide, into which the gold ore would be poured and the extracted gold is kept within the receptacle. This is different from the Heap Leaching process in which the extraction was done outside and some of the gold lost in the process.

The Minister noted that when Goldfields took over the Tarkwa and Abosso mines in 1993, they had only two years life span. However, but the company, through heavy capital investment over the years, good management practices and technical know-how, had given the company over 20 years life span, Mrs Bannerman said.

She noted that, in addition to the heavy investment in the Tarkwa and Abosso Mines, the company had proposed to extend the life span of Daman Mines, its new interest, by investing up to 294 million dollar (2.65 trillion cedis) in the 2004/2005 fiscal year.

"This obviously is a further demonstration of the company's confidence in Ghana as a conducive place for investment and good business. It is also a reflection of the current heightened interest in the mining industry in Ghana as evidenced by the entry of world class companies like Newmont, Anglogold, Red Back and Randgold."

Mrs. Bannerman said while government recognized the significant direct contribution of the mining sector to the overall economy, the focus of government policy now was to ensure that the industry stimulated and promoted sustainable economic development not only of the country generally, but also specifically of the mining areas.

She observed that the mining companies had been co-operative with government in achieving those policy goals by making creative interventions in their local communities to meet their corporate social responsibility objectives of improving the lives of the people and laying the foundation for sustainable development locally.

"I am pleased to say that fresh initiatives are being taken by the Chamber of Mines and the Ministry of Mines to improve consultative interaction with DCEs and chiefs in the mining communities for increased effective long term development of the communities," she said.

Mr Yaw Osafo-Maafo, Minister of Finance and Economic Planning, noted that the government had over the past four years sought to create a conducive environment for doing business, characterized by free speech and stable economy.

He said he was pleased that companies like Goldfields had taken advantage of that to do profitable business in Ghana.

The Minister said the mining sector was one of three major sectors selected by the government for special attention in the process to achieve the positive change goal, "and that is a prudent decision because Ghana is endowed with natural mineral resource".

Mr Osafo-Maafo said the mining industry had over the past few years witnessed tremendous growth, paying very high dividends and taxes at increasing yearly rates to government and assured them of government's support.

Mr Alan Wright, Deputy Director of Goldfields Limited, the mother company of GGL, assured the government of the company's commitment to sustainable mining that took full account of the need to operate in safe, socially and environmentally responsible manner for the benefit of all stakeholders.

He said Goldfields acknowledged that "for mining to be successful it is important that all stakeholders benefit - mining companies and shareholder must make an attractive return on their investment and the country where the company operates must benefit from employment generation, development of secondary industry, taxes, royalties and foreign exchange earnings".

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