Regulatory chaos hits Prestea-Bogoso mine

A mining lease dispute is brewing in the country, involving the Prestea-Bogoso Mine, previously operated by Blue Gold Bogoso Prestea Limited.

At the centre of the controversy are two conflicting directives issued by former Minister of Lands and Natural Resources, Samuel Abu Jinapor, in November 2024.

The first directive, dated November 12, 2024, approved the award of the mine to Heath Goldfields Ltd., citing the company's technical and financial capacity.

This decision was reportedly made despite concerns raised by Blue Gold Bogoso Prestea Limited, which had been operating the mine since August 2024, following a period of care and maintenance.

However, just eight days later, a second directive suspended all processes related to granting the mine to any company, including Heath Goldfields, pending further review.

This sudden reversal has raised questions about the transparency of the process and whether Heath Goldfields has any right to claim ownership over the mine.

The situation is further complicated by the fact that Blue Gold Bogoso Prestea Limited had provided proof of substantial financial backing, including over $100 million in daily liquidity before the lease was terminated.

Despite this, the Minerals Commission and the then Minister reportedly refused to consider the company's existing licenses or halt its decision to terminate the lease.

As a result, the assets of Blue Gold Bogoso Prestea Limited were moved and purportedly reassigned to Heath Goldfield Limited (HGL), a company with a share capital of only GH¢10,000. 

This decision has been widely criticised, with many questioning the legitimacy of Heath Goldfields' claim to the mine.

Legal battles

The dispute has led to legal battles, with Blue Gold commencing international arbitration under the Bilateral Investment Treaty in the UK, seeking a minimum of $1 billion in damages.

The company has also filed for an injunction to prevent the Ministry from issuing any new leases, and another against Heath Goldfield Limited.

The National Security has intervened in the dispute, and the Economic and Organised Crime Office (EOCO) has investigated Heath Goldfields Limited’s acquisition of the mine.

However, EOCO's new management recently cleared Heath Goldfields, citing a lack of sufficient evidence.

The Prestea-Bogoso Mine, one of Ghana's oldest and largest mining concessions, remains non-operational, with the Minerals Commission failing to generate revenue or maintain the site. 

Investor confidence

The situation has raised concerns about regulatory consistency, transparency and investor confidence in Ghana's mining sector.

Industry stakeholders are calling for urgent action to resolve the dispute and ensure that the mine is operated responsibly and sustainably.

The government must provide clarity on the status of the mine and ensure that any decisions made are in the best interests of the country and its people.

The Prestea-Bogoso Mine is a significant asset for Ghana, with an estimated 18-year life of mine based on the 5.1 million ounces of measured and indicated resources outlined in the SK-1300 filing with the SEC.

The mine has the potential to generate significant revenue and employment opportunities for the local community.

However, the ongoing dispute has left the mine non-operational for three months, with the Minerals Commission failing to generate revenue or maintain the site.

The situation is dire, with the mine facing flooding from underground water, which has the potential to damage the mine for good.

The government must act quickly to resolve the dispute and ensure that the mine is operated responsibly and sustainably.

This includes providing clarity on the status of the mine, ensuring that any decisions made are in the best interest of the country and its people, and taking steps to prevent similar disputes from arising in the future.

— Writer’s email: suleiman.mustapha@graphic.com.gh