Parliament has approved a tax concession of $259 million for AngloGold Ashanti Ghana Limited to start the redevelopment of the Obuasi Mine with a capital injection of $880 million.

The redevelopment of the revitalised concession at Obuasi and its environs by AngloGold Ashanti will fetch the government a projected revenue of $5.3 billion over the lifespan of new mine and also offer between 2,000 and 2,500 direct employment to Ghanaians and additional 1,500 during the construction phase of the mine.

Presenting the report of a joint Committee of Finance and Mines and Energy yesterday in Parliament before the approval, Chairman of the Finance Committee, Dr Mark Assibey-Yeboah, said out of the total projected revenue of $5.3 billion, $2.2 billion will come as direct contribution to government revenue through various fiscal mechanism over the life of the mine.

He also indicated that $2.4 billion will come to the economy through local content that is Ghanaian businesses participating in the value chain.

He said strong and vibrant new Obuasi Mine will also contribute to Obuasi Community Trust with an ongoing contribution of $2 per every ounce produced.

“The mine redevelopment will also enable continued funding support for the Malaria Control Programme, which has been of benefit not only to the Obuasi community but also to districts in the Upper East and the Upper West regions of Ghana,” the Finance Committee said.

He said the resumption of the operations of the Obuasi Mine will improve the security situation in Obuasi, which has in part deteriorated as a result of the mine being under care and maintenance.

“We expect new life to be breathed into once vibrant Obuasi and its environs with the commencement of the new development by AngloGold Ashanti”.

According to Dr Mark Assibey-Yeboah, who is also the New Patroitic Party (NPP) Member of Parliament for New Juaben South, the operation of the Obuasi Mine will also contribute significantly to reduce illegal mining in the area and provide livelihood to small-scale miners, who were given part of the company’s concession area which was relinquished to the State.

“The Ministry of Finance working together with the Ghana Revenue Authority and AngloGold Ashanti Ghana Limited has provisionally estimated the fiscal impact of the agreement by way of potential revenue foregone by government in granting these tax concessions to support the redevelopment of the Obuasi Mine,” the Finance Committee Chairman said.

The ranking member of the Finance Committee and National Democratic Congress (NDC) MP for Ajumako/Enyan/Essiam, Ato Forson, said the tax concession given to AngloGold was excessive for that level of investment.

He, however, advised the government to closely monitor operations of the company and ensure that AngloGold Ashanti, indeed, invest the agreed $800 million in the new mine, otherwise the company will be cheating the people of Ghana.