Ghana hopes to lure investors with new mining laws that include opening up hitherto safeguarded forest preserves, mining minister Kwadwo Agyei-Darko said on Wednesday.

"The policies that the government has adopted are flexible and favourable to a climate of changing conditions. Our doors are open," Agyei-Darko told a mining conference in South Africa.

Mining contributes about 45 percent of Ghana's foreign exchange earnings. It is Africa's second largest gold producer after South Africa and also has bauxite, aluminium, and salt resources.

But investment in new projects has dwindled in recent years due to low commodity prices, lack of competitiveness in the country's mining sector, depletion of reserves and official indecision over whether to allow gold mining in forest preserves.

That is all about to change, Agyei-Darko said.

"The government has committed itself to measures that will enhance mining and restore it to its former glory," he said.

Its latest step is an announcement that it will grant mining leases in its forest preserves to Ghanaian company Ashanti, the world's largest miner gold miner Newmont , Red Back , and Satellite/Bogosu Gold.

MINERS DID NOT WAIT IN VAIN

Newmont plans to invest $450 million in two gold mines in the country and a portion of the deposit it intends to mine is in a forest preserve.

Last week Newmont's local manager Mark Flemming told Reuters that a team of Ghanaian ministers and advisers had toured Newmont's concession within the Ntronang reserve.

"(They) concluded that the forest isn't a pristine area, and mining there won't have any impact on forestation. It's encouraging," he said.

Red Back, an Australian-based mid-tier producer, hopes to exploit deposits in a forest preserve containing about one million ounces of gold.

"This is a big plus for us. It creates a level playing field," Red Back Managing Director Ross Ashton said of Ghana's decision on Wednesday.

Agyei-Darko said he hoped to attract further investment with new legislation that is likely to come on stream this year.

It aims to guarantee stability of a mining regime for 15 years, revamp a royalties system, create scope for settling disputes and improving minerals rights acquisition.

"This will prevent conflicts that have characterised the present system," he said.

Ghana's latest moves to encourage mining has coincided with a sharp rise in the international price of gold as investors seek the relatively safe investment while the possibility of war in Iraq grows.

Bullion touched $388.50 an ounce earlier this month, its highest level in six and a half years.