The government has presented to Parliament the Minerals and Mining Royalty Regulations, 2025, a new Legislative Instrument (L.I.) aimed at introducing flexible royalty bands for gold, lithium, and other mineral resources.
The draft regulations establish a sliding-scale royalty system, enabling rates to automatically adjust in line with movements in global commodity prices.
Minister for Lands and Natural Resources, Emmanuel Armah-Kofi Buah, explained that the measure is designed to maximize state revenue during periods of high prices while easing the burden on investors when markets decline.
Speaking to journalists after laying the instrument, the minister noted that under current conditions, lithium carries a royalty rate of 7 per cent, but this could rise to 12 per cent if prices increase.
“Today, I’m proud to say that I have brought a regulation that gives us a sliding scale agreement. The advantage is that it allows the state to capture the benefit in good times, like in the gold sector, and I have to tell you we’ve done it across the mineral sector,” Mr Buah said.
He recalled that when Ghana’s lithium deal was first negotiated, global prices were around $3,000, resulting in a 10 per cent royalty rate. Under the new sliding-scale arrangement, prices above that benchmark would yield greater returns for the state.
“But today, with the sliding scale I’ve brought, even when we get to $2,500, which achieved 10%, when we get to $3,000, because of the sliding scale, $3,000 plus will go to 12%. In fact, if you do the calculation at that point, it means that $3,000, government is saving almost over $500 million,” he noted.
The minister emphasized that the framework also cushions mining firms during downturns, as royalty rates would automatically reduce when prices fall.
“This sliding scale also gives the companies consideration when prices tumble in difficult times. Then the adjustment will automatically also favour lower royalties,” he said.
Mr Buah further stressed that the regulations provide predictability for investors, minimizing uncertainty around fiscal terms.
“What is important for investors? It gives them certainty. They are very sure that in Ghana, when the price tumbles, we will not be in trouble because the government automatically will reduce royalties. When prices go up, the government will also take advantage and capture the benefit,” he explained.
In addition to royalties, the regulations introduce a one per cent Community Development Fund, earmarked for infrastructure projects in the Mfantseman Municipality. The minister highlighted that such provisions were missing from earlier agreements.
“I’m very happy today that we’ve strengthened it. We’ve even had provision in the lithium agreement that I’ve laid today. Infrastructure provisions was not in the 2023 agreement. It is in now,” he added.
The L.I., which applies to all mining contracts, is expected to improve transparency, balance investor interests, and boost state revenue once approved by Parliament.
However, the Ranking Member on the Lands and Natural Resources Committee, Kwaku Ampratwum-Sarpong, contends that the arrangement undermines public interest and erodes confidence in Ghana’s resource governance framework.
Leave a Reply