ACEP Cautions Against Euphoria Around Ghana’s Lithium Project – ACEP

The Africa Center for Energy Policy (ACEP) has urged the government to manage the euphoria surrounding the recently initiated lithium project to avoid unrealistic expectations from Ghanaians.

In the past week, the government granted Barari DV Ghana Limited, a subsidiary of Atlantic Lithium Limited, a 15-year mining lease to commence the construction and mining of lithium at Ewoyaa in the Mfantseman Municipality of the Central Region. The lease incorporates new and enhanced terms intended to ensure that the country optimally benefits from this mineral.

This includes an increase in royalty rates, state and Ghanaian participation, as well as value addition to the mined mineral. The granting of the mining lease follows the completion of prospecting and feasibility studies by the company, as well as a series of negotiations between the government and the company.

The lease covers an area of approximately 42.63 square kilometres and grants the company the exclusive right to work and produce lithium and associated minerals in the area, as per the mining laws of the country.

Lithium is one of the main minerals used in the production of lithium-ion batteries, which are being promoted as a substitute for fossil fuels as the world continues to battle climate change. Emissions from the burning of fossil fuels by internal combustion engines have been identified as one of the major contributors to the climate crisis.

To address this, global leaders are promoting a green energy transition to progressively limit and ultimately eliminate carbon emissions.

Speaking in an interview with Selorm Adonoo on Eyewitness News on Citi FM on Friday, the Executive Director of ACEP, Benjamin Boakye, noted that although the mining lease for lithium was good news, as it involved an essential mineral with great prospects, the government needed to put into proper perspective what would be obtained from the lithium project so that Ghanaians do not overestimate its prospects.

“Listening to what has come out so far, 10% royalties, some appreciation in interest, that is good news. But I think that the conversation around what it means for Ghana, we need to put that in perspective and let the citizens appreciate that even though lithium is increasingly becoming important, it is not as important as our gold, which today gives us over a billion dollars a year. We are not going to get that from the solidified lithium. Therefore, the euphoria has to be managed so that people do not think it is going to change our lives all of a sudden,” he stated.

Mr. Boakye added, “We make billions from oil, we make billions from gold. It hasn’t changed us, and therefore we have to be cautious in how we prop up our optimism about how the resources will be managed.”

He further underscored the need for the lithium project and its yields to be properly managed, as the fiscal governance of minerals has not been well-managed over the years.

“But we are hoping that this will be managed. We would improve on fiscal governance, which has been the major problem,” he added.