Accra: An ongoing debate has arisen concerning E and P's authority to sell gold from the Damang Mine, with questions about the legality of mining operations without parliamentary ratification. A social media post by Bright Simons challenges the legitimacy of E and P's actions, questioning if a lease owner can mine and sell gold prior to lease ratification by Parliament.
According to Ghana Web, the issue is rooted in historical practices and legal frameworks that lack specific timelines for parliamentary ratification of mining leases. The 1992 Constitution and the Minerals and Mining Act (Act 703) do not impose a timeframe for obtaining such ratification, nor do they oblige companies to act towards this end. Historically, many large-scale mining companies have operated for extended periods without lease ratification.
The established practice is guided by Section 13 of the Minerals and Mining Act (Act 703), which outlines procedures for granting mineral rights. The records show compliance with these procedures by E and P and Damang Gold Mines Limited (DGML) concerning the Damang Concession. Despite the absence of a signed mining lease, the law allows for mineral rights through various forms, such as undertakings or transactions.
The situation with the Damang Concession reflects the flexibility intended by the 1992 Constitution, emphasizing the need for the Minister to act swiftly to prevent mine shutdowns and ensure operational continuity. Revenue from gold sales has been retained in Ghana, pending parliamentary ratification, to facilitate future reconciliation of accounts and confirm the government's revenue share.
Critics note a discrepancy in how foreign and local companies are treated regarding lease ratification. Historically, foreign companies have operated without ratification and exported gold without similar scrutiny. The current situation with E and P is not considered to compromise the government's revenue share, as all financial obligations have been met.
The responsibility for lease ratification lies with the executive arm of the government and Parliament, not the companies. Delays in operations due to pending ratification could result in financial losses, as companies often secure significant loans to fund their projects.
In 2019, a legal case against the Attorney General and 35 mining companies for operating without lease ratification did not result in sanctions. Instead, Parliament corrected the oversight, establishing a precedent for accommodating companies during the ratification process.
Looking forward, the government is encouraged to amend the governing Act (Act 703) to establish a timeframe for parliamentary ratification. Addressing bureaucratic delays is vital to prevent companies from commencing operations prematurely. Additionally, compensation for potential revenue loss due to ratification delays should be considered if strict enforcement of the law is pursued.