The Minister for Lands and Natural Resources, Emmanuel Armah-Kofi Buah, has defended government’s decision to withdraw and renegotiate Ghana’s lithium agreement, saying the revised deal is stronger, more transparent and better aligned with the national interest.
Speaking at a press conference after laying the enhanced lithium agreement and its accompanying regulations before Parliament, Mr Buah said the new framework followed extensive consultations with key stakeholders, including host communities and civil society groups.
He said the decision to return to Parliament with a revised agreement reflected responsive leadership.
“Having listened to all stakeholders, we realised there were challenges with the earlier agreement. We withdrew it, strengthened it, and today we have returned with a much better lithium agreement and comprehensive regulations,” the Minister stated.
Mr Buah disclosed that consultations included visits to mining-affected communities such as Mankessim and Awoyaa, where concerns were raised about transparency, royalties and community benefits.
According to him, weaknesses in Ghana’s royalty regime, particularly for lithium, had persisted for years due to inconsistencies in the legal framework. While amendments to mining laws required royalties to be prescribed by law, no clear mechanism existed to guide negotiations.
“As a result, negotiators were forced to rely on flat rates even when market conditions suggested the state should be earning more,” he explained.
To address this gap, government has now introduced a sliding-scale royalty regime across the minerals sector, including lithium. The new system allows the state to earn more when prices rise and offers relief to companies when prices fall.
“This approach ensures the state captures value during good times, just as we have done in the gold sector, while maintaining fairness when prices decline,” Mr Buah said.
Using lithium as an example, he noted that the earlier agreement was negotiated when prices stood at about US$3,000 per tonne, with a 10 percent royalty. Under the new framework, government could still earn 10 percent even if prices drop to US$2,500 per tonne, and up to 12 percent when prices exceed US$3,000.
He said this adjustment could save Ghana more than US$500 million over the life of the agreement.
Beyond royalties, the revised deal introduces new provisions absent from the 2023 agreement, including infrastructure commitments and a dedicated community development fund.
“For the first time, we have a one percent community development fund that will directly benefit host communities such as Effutu and Infanciman,” the Minister announced.
He explained that the fund, drawn from one percent of gross revenue, would be used exclusively for community projects such as roads, hospitals and other social infrastructure, independent of central government funding.
“One percent of gross revenue going directly to communities is real transformation,” Mr Buah said, adding that he intends to push for similar provisions in all future mining agreements.
The Minister expressed confidence that the revised lithium agreement balances national interest with investor certainty, stressing that the new framework makes Ghana a more predictable and attractive destination for responsible mining investment.