THE agreement between Gold Fields and the Government of Ghana over the future of the Damang mine had greatly improved their relationship in recent months according to Gold Fields CEO Mike Fraser.
Responding to questions on a media call in Johannesburg today Fraser commented, “we were in a difficult position in March and were not finding each other at that point but I think we have made exceptionally good progress over the last five months “
Fraser denied the suggestion that the Ghanaian government had put pressure on Gold Fields to meet its demands over Damang by making the renewal of the mining lease for the group’s Tarkwa mine an issue in the debate.
Fraser has described Tarkwa as one of the four long-life assets that underpin the long-term future of Gold Fields’ business. He said expectations were that Tarkwa would account for about 20% of Gold Fields global production from about 2026.
He commented, “In March the minister was clear that the contribution Tarkwa makes to the economy of Ghana and the community of Tarkwa is very material.
“We feel very comfortable where we have landed and government has been keen to ask us to come to the table early on the Tarkwa lease renewal. They have been at pains to demonstrate this is a different set of circumstances because they are fully aware of our commitment to Tarkwa and to Ghana.
“I think Gold Fields’ reputation in Ghana is incredibly strong so I don’t think there was any basis for general animosity towards Gold Fields but there was a specific point of difference in relation to the pathway for Damang which has now been resolved. “
Gold Fields’ lease at Damang has been extended to April next year at which point the mine will be “handed over” to the government. Fraser said there would be no “trade sale or anything of that nature for Gold Fields account.”
He commented, “the value of the mine is relatively modest. The only way to unlock the value of the resource that exists is to invest in the mine. We don’t see any material value from our point of view.”
The Ghanaian government holds a 10% stake in Tarkwa and there has been speculation that a possible increase in the Ghanaian stake in the mine could be part of the lease renewal discussions.
Fraser commented, “there are conversations going on within Ghana around what the new mining regulations should look like but it’s not clear and there are no specifics presented about what changes could be made in terms of local ownership.
“At this stage there is nothing in the conversation about revisions to the mining legisatlion to indicate there will be a change to that (Ghanaian ownership) so at this point in time we would expect that our current level of participation would remain intact. “
Asked about the stalled merger of Tarkwa with AngloGold Ashanti’s Iduapriem mine – over which proposal a memorandum of understanding was signed in 2023 – Fraser commented that while the merger was “paused” he believed “the strategic logic of this combination will continue to make sense.”
“I absolutely do believe we should revisit that JV in the coming years.”
