The agreement will alleviate the difficulties the mines have been experiencing where no benefit has been felt dealing in the US dollar currency. Damang has been struggling in particular with the weak currency and lower grades.
The highlights of the agreement include a reduction in the corporate tax rate from 35.0% to 32.5%. This came into effect on 17 March 2016.
The royalty rate has also changed from a flat 5% of revenue to a sliding scale royalty based on the gold price (as per table below), with effect from 1 January 2017.
|Royalty rate||Gold price|
|3.0%||US$0 – 1,300/oz|
|3.5%||US$1,300 – 1,449.99/oz|
|4.0%||US$1,450 – 2,299.99/oz|
|5.0%||US$2,300/oz – unlimited|
[quote]The term of the agreement, effective from 17 March 2016, will be for a period of 11 years for Tarkwa and nine years for Damang, each renewable for an additional five years.
“Ghana continues to be a key region for Gold Fields and we commend the Government of Ghana for creating a fair and competitive environment in the country,” the company said in a statement.
Gold Fields Australia wins appeal for St Ives
The Full Court of the Federal Court of Australia on Tuesday overturned a July 2014 decision that the re-grant of certain tenements to Gold Fields Australia’s St Ives mine in 2004 by the State was not compliant with the correct processes in the Native Title Act 1993 (Cth).
As such, the Federal Court has confirmed that St Ives’ re-granted tenements are valid for the purpose of the Native Title Act, and that whilst St Ives’ rights as tenement holder and the Ngadju People’s native title rights shall coexist, St Ives’ rights shall prevail should there be any inconsistencies.
Gold Fields welcomes this finding, which confirms that it has at all times complied with its legal obligations in respect of its dealings with these tenements.
Gold Fields will continue to openly engage with the Ngadju People, and all other community stakeholders in relation to its operations in Australia. It is not yet clear whether the Ngadju People will seek to appeal this decision.