Ghana’s gold loses lustre as neighbours gain ground

Denver — Ghana’s status as a leading gold producer is being eclipsed by Tanzania, Guinea and Mali, according to a report in The Accra Mail, a private bi-weekly newspaper.

Gold production in the West African nation fell by 9%, or 226,000 oz., in 2000, while earnings dropped US$41.1 million, or 6%.

Ghana produced 2.32 million oz. during the year, earning US$648.3 million. About half of that came from Ashanti Goldfields (ASL-N). The next-biggest contributor was Gold Fields Ghana, which operates the Tarkwa mine. Gold Fields Ghana is 71%-held by South Africa’s Gold Fields (GOLD-Q).

Other significant producers were Abosso Goldfields, which increased output by 5%, to 317,696 oz., and Teberebie Goldfields, which produced 275,634 oz.

Several smaller operations, including the Bogoso mine, 70%-owned by Golden Star Resources (GSC-T), contributed an additional 490,583 oz. Golden Star has since lifted its stake in Bogoso to 90% by acquiring the 20% stake held by its partner, Anvil Mining.

The sharp decline in the gold price is responsible for the decline in mineral production, and has had a dramatic effect on the country’s economy. Gold represents 95% of the country’s mineral export revenue and ranks as its most important export, before cocoa and other commodities.

“The consequences of this [decline in production] for the global mining industry have been grave,” says James Kwamena Anaman, president of the Ghana Chamber of Mines. “Many mining companies have become insolvent because of the continued low price.”

Anaman also blames the fall in production on Ghana’s declining competitiveness. Once a leader in the region, the country is now challenged by Tanzania and Mali, which have seen their gold mining industries take off.