The Ghana Chamber of Mines has warned that the proposed amendment by the government in the Minerals and Mining Act to shorten the tenure of mining leases could end up harming the very local companies the reforms are intended to protect.
The Chamber is concerned about the proposed amendment to reduce the maximum tenure of mineral rights from the current up to 30 years to an initial 15-year term, renewable in shorter blocks.
The President of the Ghana Chamber of Mines, Michael Edem Akafia, expressed the concerns of the chamber over the proposed amendment during an interaction with fellows of the Africa Extractive Media Fellowship (AEMF).
The Current State of Mining Lease
Edem Akafia, in his explanation, stressed that the existing law does not automatically grant mining companies 30-year leases, contrary to popular belief. Instead, it allows leases of up to 30 years, with the actual duration determined by project economics and supported by feasibility studies submitted as part of the application process.
Some companies, he noted, apply for 10 or fewer years depending on the viability of their projects.
The Vice President of Gold Fields West Africa Region who is also a lawyer explained that “The current law says up to 30 years, up to, and sometimes it’s said as if it’s automatically 30 years, that’s not what it says, essentially it’s effective to say up to 30 years, so the reality of it is, in fact, even under current law, it’s not all miners who, when they apply for mineral rights, apply for 30 years, some apply for 10 years, often they themselves factor in the project economics, and that’s what determines the period, because you must always attach a feasibility to your application.”
The proposed amendment, however, would make shorter tenures the default, and that, according to the Chamber, sends the wrong signal.
Impact on Industry Investment
Edem Akafia explains that mining is a capital-intensive, long-term, and high-risk industry. Investors commit large sums over many years, often decades, before projects become profitable.
This, he says, makes the security of tenure critical, especially the certainty that comes with longer lease periods. He stresses that when you take away that security, it makes it harder to raise financing.
“Given that this industry is capital intensive, it’s long-term, it’s risky, why would you be doing away with security of 10 years, which is one of the things that investors look out for,” the President of the Chamber recounted.
He further adds that the proposal, when compared with other mature mining jurisdictions such as Canada and Australia, shows that Ghana would become an outlier if it adopts shorter lease periods. This will potentially place the country at a competitive disadvantage for global mining capital.
An Unintended Shot at Local Companies
The Chamber indicated that it has picked up signals that the main reason driving this amendment is the quest to protect local mining companies. Michael Edem Akafia reveals that he further gathers that it is a mission to shorten the lives of the foreign companies so that they can leave for the mines to be reverted to local companies.
But he warns that the amendment could backfire on local Ghanaian mining companies. While the reforms are sometimes justified on the assumption that foreign miners dominate the sector, he rejected that premise, noting that Ghanaian participation is growing.
He explains that if tenure is shortened across the board, he said, local companies will face the same financing constraints as foreign ones, making it even harder for Ghanaian firms to raise capital, plan long-term operations, and sustain projects.
The Chamber also questioned the underlying logic that reducing lease tenure would make it easier for Ghanaians to take over mining operations once foreign firms exit. To him, shorter leases do not automatically translate into local ownership; instead, they create uncertainty that discourages both foreign and domestic investment.
“I have not heard any justification; the only thing I heard is that there’s an assumption that all mining companies are foreigners, and I’ve said here that it’s not true. We are shortening by 10 years so that they’ll leave, then we can take over, that’s what I’ve been told, but I don’t see how that works,” he noted.
He continued, “if you shorten it in general law, even the Ghanaians who will take over, means they’ll still have a shortened 10 year, and they will have challenges raising funds, you know, so that’s one of the things, so how would you put it in general law, when your aim, as it were, is to benefit Ghanaians.”
The Bottomline
In the Chamber’s view, weakening tenure security undermines the very foundations of mining development, where long project cycles and heavy upfront investment demand regulatory stability.
The Chamber is therefore urging policymakers to reconsider the proposed tenure reductions, warning that what appears to be a pro-local measure could end up being a self-inflicted wound for Ghana’s mining industry.
