Former Canadian-owned mining firm was a nuisance for Ghana’s Bogoso-Prestea communities
Written by: Francis Annagu
A mining behemoth, when Canadian-owned, devastated the communities it took over, making things very tense.
Mining communities are still feeling the effects of Golden Star Resources’ (GSR) operations after, in 2020, it sold Future Global Resources (FGR) a 90 percent ownership in the Bogoso-Prestea gold mine for $55 million USD. GSR transferred massive debts and liabilities — roughly $25 million — to FGR. Golden Star Resources' president and chief executive officer, Andrew Wray, stated he was happy with the deal.
Regretfully, Golden Star Resources — which was Canadian owned until 2022 — misled the communities in which they operated by leaving without providing the proper notice or keeping the promises they made to the Bogoso-Prestea communities.
The administration of GSR at the time disregarded the Bogoso-Prestea communities and departed without resolving any other outstanding issues.
GSR said it would only meet with the local leaders outside of the mining zones and described the people there as ‘unfriendly.’ After GSR took advantage of them and destroyed their arable land, the host communities revolted against GSR and its new owner, which took control in the final quarter of 2020.
Mining communities suffering, losing livelihoods
There have been cases where disputes about how land use and livelihood have affected communities have escalated into violent altercations between the extractive entity and the locals. Voice of America reported that, ”Community activist Eric Sherwood says locals sent petitions to the capital and blocked the company's cars on the road.”
Ghana's economy benefits greatly from the mining industry, which is a major business there. Gold mining accounted for 48.4 per cent of all item exports in 2020 alone. Ghana became the continent's leading producer of the precious metal in 2018 after surpassing South Africa. By 2020, the nation ranked as Canada's fourth-largest export destination in sub-Saharan Africa. Concerning these bilateral ties, Canadian mining interests in Ghana have grown and are currently valued at more than $858.8 million.
It’s pitiful how a firm that is meant to spur rural communities' development tries to deceive and cheat them out of their hard-earned livelihoods.
Golden Star Resources had a local community livelihood program called Golden Star Oil Palm Plantation - explains Norvan Reports - which was registered, owned, and operated by the chiefs within the communities and employed over 1000 people in the plantations at Bogoso-Prestea. In 2018, Lamancha Investment Group acquired majority shares in the Bogoso-Prestea Mine. A $1 per ounce arrangement between the Mine and the communities, which the chiefs accepted in trust for the people, provided funding for the oil palm plantation. If the mine closed, the chiefs would donate their farmlands and use the $1 per ounce proceeds to establish an oil palm plantation, which would provide a means of subsistence for their communities. GSR has even taken advantage of this initiative by designating it as a corporate social responsibility in its publications, including the most recent 2020 third-quarter report.
For decades, mining communities had looked to the company to improve social infrastructures — but they were unaware that gold mining would harm the state of the few public amenities that were already in existence.
Golden Star Resources exploited underground pit mines in the communities, which are situated in Ghana’s mineral-rich southwestern areas, where the gold had to be blasted out. Unfortunately, the schools in the mining areas were impacted by the blasting noise from the explosives at the Mine, which made learning impossible.
FGR: A new 'adversary'
In 2009, according to Isaac Essien, a youth leader at Bogoso-Prestea Municipality, FGR bought the mine online. The mine has the biggest concession in Ghana. But FGR hadn’t been to the mine site to conduct due diligence or ask the tough questions necessary to ensure gold Mine continuity after the takeover.
Unfortunately, GSR stated that although FGR would pay $1 per ounce, the Golden Star Oil Palm Plantation would not be included in the sale of the Bogoso-Prestea Mine. As part of their corporate social duty, GSR would continue to manage the plantation and report on it. It makes sense that a new mine owner who wants to see the community flourish would be eager to take over such a project. But the question of who owns the oil plantation project — GSR or not — becomes ironic. GSR would operate on one concession while claiming ownership of a corporate social responsibility project on a second concession that belongs to a different mine – a seemingly nonsensical proposition.
According to GSR, restoring the damaged ecosystem following mining operations is one of the goals of the Golden Star Oil Palm Plantation project. Planting palm seedlings at the old mines is part of that. The mining company abandoned numerous pits that had engulfed the inhabitants during the rainy season, so what the locals are witnessing on the ground is very different.
Unresolved disputes
Golden Star Resources had encountered numerous problems with employees since taking over the Bogoso-Prestea Mine in 1999.
Following the sale of the Bogoso-Prestea Mines, GSR announced that it would no longer be providing severance compensation to its employees. As a result, the fired employees of GSR made strong claims for their severance money, but these expectations went unfulfilled. As a result, the workers group, ELAPSE, filed a complaint at the Labour Division of Ghana’s High Court of Justice.
Given this matter, Ghanaian labour law stipulates that an employer may end an employee's contract, but only after providing notice and paying any outstanding wages. The employee is entitled to severance compensation under the Ghana Labour Act 2003.
Thousands lost their jobs when the mine could not give money to its owners. Aisha Issis’ husband was laid off from his underground gold mining, and the family experienced financial hardship. Issis said they were penniless and her children had been expelled from school for failing to pay their tuition. Issis holds Golden Star Resources responsible for destroying the jobs and natural environment of the Bogoso-Prestea communities.
As gold prices are skyrocketing and environmental harm is occurring, the local populace is looking for better livelihood options and a stable future. However, FGR's inherited issues, which caused bitter disputes with GSR for decades, could destroy the already precarious relationship with mining communities.
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Francis Annagu is an experienced data journalist. He was a Fellow of the Global Forest Watch Deforestation Fellowship in 2021 and the Tiger Eye Foundation in 2022.
He was awarded funding by the Wits Africa-China Reporting Project in 2022, the Pulitzer Center and the Rainforest Journalism Fund in 2021. Among other publications, he has written for InfoCongo, EnviroNews, and Panorama Papers. His past writing clips include Mining, Baka, WeWood, Boki, and Zipline.
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