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Ghana opens its first gold refinery to gain more value from the resource

Thu Aug 08 2024

Ghana, Africa’s largest gold producer, has inaugurated its first refinery to extract greater value from its natural resources according to reports from Bloomberg.

The Royal Ghana Gold Refinery is set to refine 400 kilograms of gold daily, primarily sourcing its raw material from artisanal and small-scale mines, which officially contribute to one-third of Ghana’s annual output of approximately 4 million ounces.

Bank of Ghana Governor Ernest Addison stated that the refinery would play a significant role in reducing gold smuggling, a longstanding challenge for the country, by providing a ready market for artisanal and small-scale miners.

He said, “This refinery will play an important role in reducing gold smuggling which has been a major challenge for the country over the years by providing a ready market for artisanal and small-scale miners. This gold refinery can mitigate the incentive for smuggling and help promote transparency and accountability in gold trading,”  

The country’s finance Minister, Mohammed Amin Adam also lamented that near zero value addition to the country’s gold despite it being among the top 10 biggest gold producers in the world.

He said, “Our failure to successfully ensure value addition across the entire resource chain has meant that we have been unable to properly harness the benefits of being among the top 10 gold producers in the world,”  

Owners of the plant 

The refinery is majorly owned by Rosy Royal Minerals Ltd. of India which holds an 80% ownership stake while the remaining 20% is owned by the Bank of Ghana.

This refinery complements other initiatives aimed at formalizing Ghana’s artisanal and small-scale gold mining sector.

As part of a program to enhance its foreign exchange reserves and counter a weakening currency, the central bank has been purchasing gold from small miners.

This approach is being emulated or considered by other African nations, including Uganda and Madagascar.

What you should know  

• The history of gold mining in present-day Ghana, formerly known as the Gold Coast during British colonial rule, spans centuries.
• In 2023, the country produced 4 million ounces of the precious metal representing an increase of 8.3% according to data from the country’s authorities.
• The move to start local processing of the precious metal aligns with a broader effort across Africa to add value to natural resources before exporting them, thereby achieving greater economic benefits.
• Across different industries from solid minerals to agro produce like cocoa, African countries are expending greater resources towards local value in addition to its natural resources.

Source: https://nairametrics.com/