The Minerals and Mining Act, 2006 Act 703, as amended by Act 900 of 2015, is the governing legislation for Ghana's minerals and mining sector. It encompasses provisions for the regulation of small-scale mining operations in Ghana,
As amended, section 1 of Act 703 re-enforces the constitutional provision that every mineral in its natural state occurring in Ghana remains the property of the Republic of Ghana. It succinctly states that "every mineral in its natural state in, under, or upon the land in Ghana, rivers, streams, watercourses throughout the country, the exclusive economic zone, and an area covered by the territorial sea or continental shelf are the property of the Republic of Ghana and is vested in the President in trust for the people of Ghana".
Act 703, as amended, provides that lands within the Republic of Ghana may be the subject of an application for mining in respect of a mineral specified in the application. As such, a person seeking to engage in small-scale mining in Ghana must apply to the sector minister responsible for mines and obtain permission or approval before embarking on such an activity.
Therefore, it is appropriate to understand that the Minister responsible for mines shall, acting on behalf of the President of the Republic of Ghana and on the recommendation of the Minerals Commission, grant a licence for an entity to engage in small-scale mining within a defined area within Ghana's jurisdiction.
Small-scale mining defined
Act 703, as amended, defines a small-scale mining operation as "...mining operation over an area of land by the number of blocks prescribed." This definition does not represent or reflect what a small-scale mining operation is intended to represent. To wit, it fails to clearly portray the usual characteristics of small-scale mining operations, an activity by local indigenes on a small piece of land devoid of sophisticated mining tools and equipment.
Broadly speaking, small-scale mining operations take place within a small area due to their rudimentary nature and lack of serious capital investment compared to large-scale mining. However its nature and form, their operations must be within the limit and scope of Act 703, as amended.
It is important to point out that small-scale mining contributes significantly to poverty reduction and stimulates economic growth in the local communities. In some instances, small-scale mining serves as a precursor to large-scale exploration companies.
In Ghana, the contribution of small-scale mining to overall gold production cannot be underestimated. Its contribution is significant to total gold production. It contributed 43% (2.1 million oz) of total gold production in 2018, 36% in 2019, 30% in 2020, and almost 100% of diamond production.
Legal and Regulatory Framework for Small-Scale Mining in Ghana
The following legislation has a significant impact on small-scale mining operations in Ghana and contains provisions on the operations of small-scale mining in Ghana.
- Minerals and Mining Act, 2006 (Act 703)
- Minerals and Mining (Amendment Act), 2019 (Act 995)
- Minerals and Mining (General) Regulation, 2012 (L.I 2173)
- Minerals and Mining (Support Services) Regulation, 2012 (L.I 2174)
- Minerals and Mining (Compensation and Resettlement) Regulations, 2012 (L.I 2175)
- Minerals and Mining (Licensing) Regulations, 2012 (L.I 2176)
- Minerals and Mining (Explosives) Regulations, 2012 (L.I 2177)
- Minerals and Mining (Health, Safety and Technical) Regulations, 2012 (L.I 2182)
- Minerals and Mining (Tracking of Earth Moving and Mining Equipment) Regulation, 2020 (L.I 2404)
- Minerals and Mining (Local Content and Local Participation) Regulation, 2020 (L.I 2431)
Licence for Small-Scale Mining
Section 82 of Act 703, as amended, provides the legislative framework for the License of small-scale mining in Ghana. Without contrary opinion, it states that a person shall not engage in or undertake a small-scale mining operation for a mineral unless the Minister grants a mining licence.
As such, before embarking on a small-scale mining operation, an entity needs to apply for and receive a licence from the Minister responsible for mines.
Legal Qualification for Small-Scale Mining Licence
Legal qualification under Act 703 as amended exists for the grant of a small-scale mining licence for the operation of small-scale mining in Ghana.
It provides that a small-scale mining licence shall not be issued to a person unless that person qualifies under the following:
- Is a citizen of Ghana
- Has attained the age of 18 years, and
- Is registered by the office of the Minerals Commission in an area designated as District Office
Condition for Grant of Licence for Small-Scale Mining
Act 703, as amended, lays out the conditions for granting a small-scale mining licence. Section 84 of Act 703, as amended, states that a licence for small-scale mining granted by the Minister responsible for mines shall be in respect to the mineral specified in the Licence and shall further be subjected to the conditions specified in the Licence.
Thus, the licence issuance to undertake a small-scale mining operation shall be accompanied by conditions.
Application Process for Small-Scale Mining Licence
The Minerals Commission of Ghana and the Minister responsible for mines are collectively responsible for the processes that lead to the issuance of a licence to undertake small-scale mining in Ghana.
Below are the steps reasonably expected to lead to issuing a licence to commence a small-scale mining operation.
- Step 1: Submission of application
An applicant for a small-scale mining licence is expected to present all relevant documents to the District Office in the area where the mining is expected to take place and complete the application document incidental to the licence application.
- Step 2: Submission to Minerals Title Department (MTD)
Ten (10) days after the receipt of the application at the District Office and certification of its completeness, the District Office shall submit the application to MTD. MTD is expected to review the application dossier in ten (10) days and record the same in the priority register.
- Step 3: Publication in the Gazette
Fifteen (15) days after recording it in the priority register, MTD shall do the following:
- Publish in the gazette the application,
- Notify chiefs, traditional authorities among others through the District Office of the Minerals Commission.
This is crucial. It allows the chiefs and traditional authorities to have an input in the outcome of the licence grant.
- Step 4: Application Dossier
The District Office shall submit the application dossier to MTD within ten (10) days of publication for appropriate recommendation to the Minister responsible for mines.
- Step 5: Minister takes Decision
Upon presentation of the dossier and the accompanying recommendation, the Minister shall make the final Decision.
- Step 6: Final Decision Communicated to the Applicant
Twenty (21) days after the Minister decides on the application, the Commission shall be obliged to communicate the outcome to the applicant. Positive outcome demands that an applicant takes practicable steps to make payment of the incidental fees regarding the grant of the Licence.
A negative outcome would result in a rejection of the Licence for small-scale mining in the designated area. The reasons for such an outcome would be communicated to the applicant.
- Step 7: Applicant makes payment for the Licence
Within sixty (60) days after bringing to the attention of an applicant a positive outcome, the applicant is expected to make payment of the applicable fees and communicate the notice of acceptance to the grant of a licence to the Minister and Minerals Commission. The communication of an acceptance shall be in writing.
- Step 8: Issuance of Licence
On proof of payment of the licence fees, the Minister shall authorize the issuance of the applicant's Licence. It shall be within thirty (30) days after the date of the acceptance of the grant of the Licence.
Duration of Licence
A licence granted under section 82 to a person, a group of persons, a cooperative society or a company shall be for at most five (5) years from the date of issue in the first instance. It may be renewed on expiry for a further period, which the Minister may determine.
Area Covered by Licence
The size of the area for which a licence may be granted for small-scale mining shall be in accordance with the number of blocks prescribed.
Revocation of Licence
Act 703, as amended, provides grounds for revoking a licence. It provides in section 87 that a licence granted for small-scale mining may be revoked when the Minister finds the existence of any of the following.
- The Minister is satisfied that the licensee has contravened or failed to comply with a term or condition of the Licence or a requirement applicable to the licensee.
- The licensee is convicted of any offence relating to smuggling or illegal sale or dealing in minerals or
- The Minister is satisfied that doing so is in the public interest.
Transfer of Licence
Act 703, as amended, provides for the transferability of licences granted for small-scale mining operations. Section 88 of Act 703 states that a licence granted under section 82 (1) may be transferred only to a citizen and with the consent of the Minister responsible for mines. Therefore, transfers of interest in a licence granted are permissible under the consent of the Minister for mines.
Operations of small-scale miners
A person licensed under section 82 of act 703 as amended may win, mine and produce minerals by an effective and efficient method and shall observe good mining practices, health and safety rules, and pay due regard to protecting the environment during mining operations.
Use of Explosives
A small-scale miner shall not use explosives in the area of operation without the written permission of the Minister responsible for mines and on the recommendation of the Minerals Commission.
Compensation for Land Use
Where a licence is granted in a designated area to a person other than the owner of the land, the licensee shall pay compensation for the use of the land and destruction of crops to the owner of the land that the Minister, in consultation with the Minerals Commission and the Government agency responsible for the valuation of public lands may prescribe.
Conclusion
Small-scale mining operations are well-regulated in Ghana. Despite its challenges, well-regulated and enforced rules on small-scale mining contribute to Ghana's growth by stimulating economic activity in the various communities.
It is important to point out that small-scale mining contributes significantly to poverty reduction and stimulates economic growth in the local communities. In some instances, small-scale mining serves as a precursor to large-scale exploration companies.
Therefore, small-scale mining must be nurtured through adequate rules.
Legal Notice
The contents of this publication, current at the date of publication set out above, are for reference purposes only. They do not constitute legal advice and should not be relied upon. Legal advice about your particular circumstances should always be sought separately before taking action based on this publication.
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