5.0 Artisanal, Small and Medium Scale Mining (ASM) Support Program for Sustainable Development. On behalf of the Government of Ghana and in accordance with the powers conferred on the Minister of Lands and Mineral Resources under Section 3 of the Minerals and Mining Law, 1986, PNDCL 153 and Section 16 of the Small-Scale Gold Mining Law, 1989, PNDCL 218, now replaced by Section 6 of the Minerals and Mining Act, 2006 Act of Parliament 703, license was granted to Solomon Investments Ghana Limited (SIGL) to purchase gold & other precious minerals, assay, refine, sell, and export locally and internationally from licensed small scale miners in the country, from the Company’s head office in Accra and other sub-offices in Ghana.
SIGL accordingly deployed itself to establish buying centers all over the major gold producing areas, with the expectation of buying USD 2.5 million quantity of gold at least twice a week. The Company quickly realized that despite the huge potentials of gold and other minerals in Ghana, the small scale mining was very badly organized and promoted, and lacked the potential to sustain production capable of allowing SIGL Investments to develop a meaningful first class refinery input of raw material, befitting the status of Ghana the former Gold Coast.
SIGL consequently stalled its operations, and focused efforts on serious field research for a tested program to increase and sustain production development of ASM, and guarantee the needed quantity supply for refinery and jewelry manufacturing. Findings of 8 years of work confirmed the need to develop an ASM Out-Grower Institutional Capacity Development Support Program, by working with both legal and illegal miners to confront problems presented by “Galamsey”, and produce effective solutions. Solutions include acquiring responsible best practices in mining management and operations, skills acquisition of technical knowhow, acquisition of licenses, funding, technical support and training, with substantial increased production, and avoidance of foreigners taking over the gold business to the detriment of the country and to other countries͘. SIGL’s derived Support Program solution is therefore aimed at clear win-win permanent solutions to Galamsey activity. For all other stake holders, the aim is to provide sufficient gold for socio-economic and industrial development, in a collective quest to attain and sustain the ASM industry in Ghana.
Before the establishment of the Gold Coast Colony in 1874, thousands of indigenous people relied on small-scale extraction of gold as a principal source of employment and for livelihood. From its relatively humble beginning, today official figures put small scale concessions at about 300 in number, but there
are about 30,000 or more of non-registered artisanal small scale groups (ASM). These produce about 1.4 million ounces, representing 34% of total gold production and utilizing at least 1 million people, who if given necessary assistance, can produce an average output of 20 kg per month per concession, compared to their low and hazardous present average production of about 1 kg per month.
SIGL is ready to begin support services to its first 100-200 pre-identified mining concessions, to reach a minimum of 2,000 concessions within 2 years of operations, and at least 10,000 as the long term 5 year target. From conducted pilot programs, the level of output expected on the average of 20 kg per month per concession, would equate to a minimum of 200,000 kg per month and therefore 2000 tons per annum. This quantity would more than sufficice to permit viability and sustainability of the Gold Refinery’s operations.
5.1 STATE OF THE ARTISANAL, SMALL AND MEDIUM SCALE MINING SECTOR IN GHANA
The findings from continued field research and pilot programs conducted since its inception in 2006 mainly by the Research and Development Unit of SIGL, over the various Regions of Ghana, revealed that the low output from small and medium scale miners in the country, is due to the lack of working capital, modern equipment, training and knowledge of best mining practices. The obvious conclusion is not to shy away from the challenges faced by ASM, but rather recognize Small Miners as the way forward as seriously being advocated by the Government. Stopping or eradicating them is not the answer, teaching them how to mine responsibly and feed themselves, whilst making Ghana prosper is.
Small-scale mining is essentially an artisanal or small industrial form of raw material extraction. In Ghana, there are about 300 registered small-scale mining groups, who constitute a major source of employment especially for small-scale gold and diamond miners, and contribute foreign exchange to Ghana’s economy͘. However, there are a lot more of such groups, as many as 30,000, possibly more than 120,000 that are not registered, using over 1.5 million people, and who cannot access any meaningful form of support to boost their business to make a decent living.
5.2 THE MENACE OF SMALL-SCALE MINING
There are several challenges faced by small-scale miners, which also pose a great danger to the environment. The activities of the miners pollute rivers and streams nearby that serve as a source of drinking water for downstream communities. The ‘crude’ technologies often used also pose a danger to the miners themselves, who are constantly killed due to poor occupational-safety standards. Aside the environmental and occupational hazards, these businesses are not registered and hence, do not benefit from any form of training to improve their business practices. The non-registration of their businesses also means government loses the requisite taxes for development.
Small-scale mining is often poverty driven and located in rural areas. Miners are generally unskilled and earn little. Individuals may be involved in a number of different types of mining activity: Gold or diamond rush, which is characterized by unstable communities, and often saddled with environmental degradation from the crude methods and chemicals used. In Ghana, the Birim and Densu Rivers in the Eastern Region are examples of rivers that serve as a source of drinking water for several communities, but have been gravely affected by small-scale mining activities.
A principal development issue is how to ensure that small-scale mining does not harm the community, but instead creates the basis for poverty reduction and sustainable development. In terms of methodology and classification of how this can be achieved as our field research and findings reveal, depends partly on the nature of the mining. For example, if exploitation is sudden (such as alluvial and rush activities in Ghana) and short-lived, particular effort should be made to stabilize the local community. Environmental degradation is widespread, as most sites are left in deplorable states with no establishment of land reclamation or rehabilitation after vegetation and plantations are removed, and the soil and rivers are left in sordid states, polluted with poisonous chemicals such as mercury and cyanide.
In the case of remote seasonal operations, the main issue is how to integrate legal, responsible and best sustainable small-scale mining sector practice into the local community, and encourage both local and foreign businesses to invest funds, skills, technology and expertise in ASM and other forms of economic activity and services such as schools and health centers. In research work done by Thomas Hentschel, Felix Hruschka and Michael Priester in “Artisanal and Small-Scale Mining: Challenges and opportunities”, they identify organizational aspects as playing a key role in this context, and highlight the common tools for improving the sector as:
1) Organizational and legal support;
2) Access to prospective land;
3) Training and application of technology;
4) Dissemination of best mining practices;
5) Best entrepreneurial, management and business operations and accounting practices;
6) Availability of micro-credits, working funds and equipment; and
7) Responsible use of generated revenues.
In the past, most activities to support mining sector have focused on the ASM large scale mining operations, mainly to improve their productivity, profitability, legal status or environmental performance. These projects have sometimes, despite some CRS efforts benefited only a few operations or mining entrepreneurs, and have not initiated meaningful sustainable development in the whole mining community or the nearby communities. In other words support was not seen in the context of the whole community and the people living in the communities. There are also a lot of examples, especially from ‘gold-rush’ areas, where there has been no benefit at all to the livelihoods of the communities during or after the rush activities.
In the case of remote seasonal operations, the main issue is how to integrate the small-scale mining sector into the local community and encourage the businesses to invest their profits in ASM and other economic activities and services such as schools and health centers. In the same research work done by Thomas Hentschel, Felix Hruschka and Michael Priester in “Artisanal and Small-Scale Mining: Challenges and opportunities”, they identify organizational aspects as playing a key role in this context, and highlight the common tools for improving the sector as:
1) The Mainstreaming of poverty eradication into national policymaking in all sectors including minerals for quick implementation.
2) The Promotion of small-scale mining as a catalyst and anchor for other productive activities to stimulate the development of complementary and alternative productive ventures necessary for sustainable poverty alleviation. 3) The “Placing People First” through both pro-poor strategies and participatory strategies aimed at strengthening the organizational capability of grassroots communities, thereby favoring bottom-up approach.
4) The Reduction of long term crime, violence and other national security risks due to long term unemployment, frustration, poverty particularly in large scale mining dominated environment for subsistence͘
5) Reversing focus from ‘hands-on state intervention and mere legislation’ (which has rarely been successful) to the creation of home grown private enterprises led solutions with management control of mine operations particularly for such microenterprises or cooperatives.
6) Distinguishing nature and size of concessions, training, developing and building institutional capacity and the classification of such ventures as Artisanal, Small and Medium Scale (ASM).
For Ghana, the pilot projects conducted by the Department for Economic and Social Affairs and those recently conducted so far by SIGL present an opportunity to scale up the successes. Streamlining of management, operations, training and application of technology can reduce the negative environmental impact so as to boost investment, create jobs and also support initiatives with sustained community development, through land reclamation and rehabilitation exercises at end of each project.
5.3 SOLOMON’S 5 YEAR ARTISANAL, SMALL AND MEDIUM SCALE SUPPORT ROLLING PROGRAM
The main objective of SIGL’s ASM support services program is to develop a 5 year out-grower rolling program, to enable Direct Best Practices Institutionalized Operations, Management, Monitoring and Supervisory Mining and Control to produce sufficient quantity of gold and other minerals, on a sustainable basis at all times, from the ASM. It will bring about feasible immediate implementation of SIGL’s World Class Gold Star Refinery and Jewelry Manufacturing Plant, with a strategic development plan to ensure synchronization with all the other facilities of the Gold City Hub, and other Regions mainly Ashanti, Central and Western Region Artisanal and Designer Jewelry, all starting together at the same time.
We have the pleasure of seeing few other programs as detailed as ours, but none seems to be as comprehensive with the elaborate reclamation and rehabilitation expertise activities here presented for our country Ghana.
We believe we could target and convert to best practice 30% of all “Galamseyers” nationwide, and also help other ASM adopt and sustain these best practices.
Till the full development and completion of the World Class Refinery over the 5 year period and under its policy of inclusiveness of all, SIGL shall provide tempera primary refinery opportunities to existing local refineries who must all try to seize the opportunity to join SIGL and form a joint-venture subsidiary firm with the World Class Refinery’s pre-identified foreign strategic investors.
Classifying the sector into Artisanal, Small and Medium Scale Mining concessions, SIGL’s developed
program is a 5 year Out-Grower Rolling Support Program for each concession owner, in which SIGL engineers would deal by identifying and classifying the concession (as artisanal, small or medium in size) accessing its eligibility, and when and where necessary, provide access to legal and organizational support, on the job training and application of technology, availability of funds, working capital, equipment and logistics, partnership engineering, marketing, and distribution with controlled use of generated revenues for their proper affectation and application.