Ghana on Thursday opened a brand new gold refinery, The Royal Ghana Gold Refinery, the first of its kind in West Africa, to add more value from the natural resource and also generate revenue that was constructed at a cost of $100 million.
The Royal Ghana Gold Refinery is set to become only the second in Africa to achieve the prestigious London Bullion Market Association (LBMA) Good Delivery Bar Certification.
This state-of-the-art refinery, is located in Accra, was commissioned on Thursday by Vice President Mahamudu Bawumia, who hailed it as a “historic achievement towards economic transformation and industrialisation of Ghana.”
Capacity of the Ghana Gold Refinery
The gold refinery, which was established by a partnership of the Bank of Ghana and Rosy Royal Minerals Limited, has the capacity to refine up to 400 kilogrammes of gold per day.
This amounts to a yearly capacity of 120 tons, sufficient to process all of Ghana’s gold production, which averages around four million ounces per year.
As for now, Ghana’s gold is exported while in its unprocessed form, meaning the country misses out on significant revenue that could be retained through local refining.
Significance of the Project to the Economy of Ghana
“Having the ability to refine our own gold, we will be able to sell it at the appropriate price, enabling us to retain its economic value within our borders while creating numerous jobs for the youth in Ghana,” Ghanaian Vice President Mahamudu Bawumia said at the refinery’s launch, marking “a new era” poised to contain gold smuggling activities that are usually conducted and enhance Ghana’s gold revenues.
Additionally, Finance Minister Mohammed Amin Adam said while gold accounts for approximately 96 per cent of Ghana’s minerals exports, the raw state of the commodity i.e. gold limits the revenue potential of Ghana.
“The new refinery opens many doors for economic transformation by creating jobs for the citizens that will have a multiplying effect on the local economy,” he mentioned.
Ghana the Leading Producer of Gold in Africa
Ghana stands as Africa’s leading gold producer, with the precious metal accounting for over half of the country’s total exports. Gold is the most commercially exploited mineral in Ghana, accounting for about 95% of the country’s mineral revenue. Other commercially exploited minerals in Ghana are manganese, bauxite, and diamonds. The country is also endowed with deposits of iron ore, limestone, columbite-tantalite, feldspar, quartz, and salt, and there are also minor deposits of ilmenite, magnetite, and rutile. In 2018, Ghana discovered commercial quantities of lithium and is working with international partners to mine and develop lithium mining and processing.
Ghanaian mining production traditionally was state owned, but starting in the 1980s, Ghana moved toward privatization and state divestiture, including by attracting foreign investment. Some of the major mining companies in Ghana are Newmont Goldcorp (American), Gold Fields, AngloGold Ashanti, among others.
In the first half of the year 2024, gold exports soared, driven by a surge in global gold prices and increased production.
The spike in prices, which saw gold reach a record $2,338 an ounce in the second quarter, contributed to gold exports totalling $5bn, or 54 per cent of the country’s total exports.
Lastly, Illegal mining activities has been a major problem in the West African country as it tries to address environmental degradation and pollution of water bodies by these activities.
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