The government is proposing to reduce the maximum duration of mining leases from 30 years to 20 years through amendments to the Minerals and Mining Act, 2006 (Act 703), as part of efforts to strengthen governance in the sector and increase the benefits Ghana derives from its mineral resources.

The proposed reforms, which have already received Cabinet approval, will be submitted to Parliament for consideration, the Minister for Lands and Natural Resources, Emmanuel Armah-Kofi Buah, announced during the Government Accountability Series in Accra on Wednesday, July 15.

According to the Minister, the review is intended to improve the management of the country’s mineral wealth while ensuring that host communities and the nation receive greater value from mining operations.

Under the current law, mining companies can be granted an initial lease of up to 30 years, with the option of renewing it for another 30 years. The proposed amendment, however, seeks to cap all mining leases at 20 years.

The reforms also introduce mandatory Community Development Agreements, requiring mining companies to negotiate and agree on development projects with host communities before commencing operations.

“I’ve also limited the fixed period to 20 years, and we have introduced community development agreements,” Armah-Kofi Buah said.

The Minister explained that the measure is aimed at addressing longstanding concerns that mining communities have not received adequate benefits from the exploitation of resources in their localities.

“There are always communities that complain about developments. And so every mining lease will also have another additional community development agreement that has been signed between the mining company and the community,” he explained.

He added that the proposed framework would give communities a direct role in determining their development priorities instead of leaving such decisions solely to mining companies.

“It’s no longer going to be the choice of a mining company that will decide, ‘I’ll give them some water.’ The community will negotiate in those mining agreements, with community agreements, their critical needs, and that will be agreed voluntarily by the mining company and the community,” he said.

Mr. Armah-Kofi Buah noted that the proposed amendments form part of a broader package of reforms contained in the new mining legislation, which is designed to improve governance, promote transparency and ensure mining communities receive more meaningful and sustainable benefits from the country’s mineral wealth.

Chamber of Mines’ earlier concerns

The latest proposal comes after the Ghana Chamber of Mines (GCM) earlier expressed serious reservations about an initial proposal to reduce the tenure of mining leases from 30 years to 15 years.

While the Chamber acknowledged that the government’s plans to amend the Minerals and Mining Act, 2006 (Act 703) to support greater local participation in the mining sector were commendable, it argued that a significant reduction in lease duration would be detrimental to investment and ultimately counterproductive.

Mining has been a key pillar of Ghana’s economy since 1897, with the country currently hosting 13 large-scale mining companies. Under existing arrangements, the government holds an automatic 10 per cent carried interest in each of these companies.

The Minerals and Mining Act, 2006 (Act 703) has not undergone a major review in nearly two decades. Similarly, Ghana’s Minerals and Mining Policy, introduced in 2014, has not been revised despite a requirement for periodic reviews every five years.