Does E&P have the right to sell gold from Damang? A legal and governance analysis

An examination of the legal provisions, historical context and practice, and the way forward.

I have read on social media a write-up attributed to Bright Simons in which he raises fundamental questions that go to the heart of resource governance—namely, whether a leaseholder can commence mining when the lease has not yet been ratified by Parliament, and whether gold produced under such circumstances can be lawfully disposed of (sold) by the leaseholder.

The writer queries: “Why are they [E&P] selling gold from a mine when their lease has yet to be ratified by Parliament? The law is clear. Until Parliament ratifies a lease, the gold in any concession belongs to the State, and no other company. E&P has no right to be selling the gold. Even if these are stockpiles left by Gold Fields, they belong to the State. And then they make it look like they are doing Ghana a favour.”

While the questions raised are legitimate, the responses must be situated within historical context, while also highlighting the governance gaps that may have contributed to situations where operations precede parliamentary ratification.

Both the 1992 Constitution and the governing Minerals and Mining Act, 2006 (Act 703), did not stipulate a time frame for obtaining parliamentary ratification of mining leases. They also did not impose an obligation on companies to trigger or expedite the ratification process. As a result, historically, many large-scale mining companies have operated for several years—and in some cases over a decade—without ratified mining leases.

The practice has largely been guided by Section 13 of Act 703, which sets out the procedure for the grant of a mineral right. Under Section 13(1), after the Minerals Commission recommends approval of an application, the Minister shall notify the applicant in writing within 60 days, after which the approval is published in the Gazette. Under Section 13(4), the applicant shall notify the Minister of acceptance of the offer, and under Section 13(5), the Minister shall grant the mineral right upon receipt of such notification. Section 13(9) further provides that the grant of a mineral right entitles the holder to enter the land in respect of which the right is granted.

In the case of Damang Gold Mine Limited (DGML), I am aware that every step outlined in Section 13 has been complied with, and there are documents to support this. The presence of E&P and DGML on the Damang concession is therefore grounded in law.

Available records also indicate that since 18 April 2026, E&P and DGML have paid all staff salaries and other operational expenses associated with the running of the mine, in some cases even before the sale of the first gold.

It is true that DGML has not yet signed a mining lease in respect of the Damang concession. However, under Article 268 of the 1992 Constitution, a mineral right is not limited strictly to a mining lease; it may take the form of an undertaking, contract, or transaction, however described. The situation at Damang appears to fall within this broader constitutional understanding.

The exigencies of the Damang situation required the Minister to enter into the arrangement to prevent the mine from shutting down from 18 April 2026.

I do not believe the Government’s stake in revenues from the sale of gold has been compromised. Rather, revenues have been retained in Ghana to facilitate subsequent reconciliation of accounts after parliamentary ratification, at which point the applicable revenue-sharing structure can be properly determined. This is an issue GHEITI is expected to address in its annual reporting.

It is also important to note that many foreign mining companies operating in Ghana have historically commenced operations and exported gold prior to parliamentary ratification of leases, without similar objections being raised that the gold belonged to the State. It is therefore important that a consistent standard is applied.

Can companies be blamed for mining while ratification is pending?

Technically, the answer is no. Companies cannot be blamed, because the responsibility for parliamentary ratification rests not with them, but with the executive arm of government and Parliament.

It must also be recognised that mining companies often take on significant project financing, and delays in commencement of operations can lead to substantial interest costs even before production begins.

In 2019, when two Members of Parliament sued the Attorney General and 35 mining companies for operating without ratified leases in alleged breach of Article 268 of the 1992 Constitution, government did not impose sanctions on the companies. Instead, Parliament moved to regularise the situation through ratification. This sets a precedent.

If such arrangements were accommodated for multinational companies, the same consideration should apply to indigenous companies, particularly where operations at Damang involve an existing mine and a halt would result in job losses and revenue disruptions.

It is therefore prudent, in this context, to allow operations to continue while parliamentary ratification is pursued.

Way Forward

1. Government should take advantage of ongoing mining sector reforms to amend Act 703 and establish a clear timeframe for parliamentary ratification of mining leases.
2. Government should take steps to reduce bureaucratic delays that force companies to commence operations prior to ratification.
3. If strict enforcement is pursued, provision should be made for compensation to companies for any loss of revenue arising from delays in ratification.

By Dr Steve Manteaw