Commodities
Ghana’s wildcat gold mining booms, poisoning people and nature
By Maxwell Akalaare Adombila
PRESTEA-HUNI VALLEY, Ghana (Reuters) – At an unlicensed gold mine in Ghana, men in t-shirts, shorts and rubber boots wade through pools of muddy water laced with mercury, pull out rocks with bare hands and operate a rickety sluice as they search for the precious ore.
The ramshackle mine is part of a booming business that is generating livelihoods and informal revenue streams for Ghana’s economy, even as it harms miners’ health, pollutes waterways, destroys forests and cocoa farms, and fuels crime.
“It’s risky but I just want to survive,” said one of the men at the wildcat site visited by Reuters in the Prestea-Huni Valley district in western Ghana.
The 24-year-old accounting student, who asked not to be named because he was involved in illegal activities, said he had been skipping classes to prospect for gold because he needed the money, having lost his father as a teenager.
There was no professional protective equipment at the mine. Men wore flimsy plastic shopping bags on their heads. One had swimming goggles and another a rice bag covering his torso.
The unlicensed gold mining industry, known in Ghana as “galamsey”, has grown at a breakneck pace this year as global gold prices have risen by almost 30%, enticing new entrants.
Small-scale mines produced 1.2 million ounces of gold in the first seven months of this year, more than in the whole of 2023, according to data from Ghana’s mining sector regulator.
About 40% of Ghana’s total gold output comes from small mines, as opposed to concessions operated by multi-national firms. Some 70-80% of the small mines are unlicensed.
POISONED PROFITS
Martin Ayisi, head of Ghana’s Minerals Commission, the mining industry regulator, said most galamsey gold was smuggled out of the country and was therefore not contributing to national gold export revenues.
For Ayisi, the rise in gold prices is good for Ghana, helping it recover from a severe economic crisis in 2022 that required a $3-billion IMF bailout.
“We should be able to get a lot of money and probably exit the IMF programme earlier,” he said, forecasting national gold export revenues would more than double to $10 billion this year.
But industry experts say the lines between legal mining and galamsey are blurred, and gold from informal mines represents a larger proportion of revenues than the authorities acknowledge.
The dangers of galamsey, however, are not in dispute.
Dozens of miners have been killed in collapsing pits in recent years, according to news reports and human rights groups, while hospitals and health centres report high numbers of early deaths from pulmonary diseases of miners and residents of towns and villages near mines.
These are caused by inhaling dust that contains heavy metals such as lead, as well as poisonous fumes from the mercury and nitric acid the miners use to leach gold out of sediment.
The chemicals are then dumped on the ground or in rivers. Ghana’s water authority says mercury and heavy metals from mining have contaminated about 65% of water sources.
Meanwhile, thousands of hectares (acres) of cocoa plantations and virgin forest have been destroyed by illegal miners, according to data from Global Forest Watch, an online monitoring platform.
Protesters have taken to the streets in Accra in recent weeks to criticise President Nana Akufo-Addo’s government over what they saw as its failure to tackle these problems. “Leaders, you’ve failed us!” read some of the placards.
“Galamsey has to stop. We want to live long. We don’t want to fall sick. We don’t want to go to the hospital,” said Aboubacar Sadekh, who was taking part in a march on Sept. 22, draped in a Ghanaian flag.
The government denies that it is failing to act on galamsey. When he came to power in 2017, Akufo-Addo pledged to take action on the issue, and during his time in office the government has launched crackdowns, deploying soldiers to arrest illegal miners. In some cases, mining equipment was seized and destroyed.
ORGANISED CRIME
Opinion polls suggest galamsey is one of the top five issues for voters ahead of a Dec. 7 general election.
The main candidates to replace outgoing Akufo-Addo as president, Vice President Mahamudu Bawumia and former President John Mahama, have pledged to formalise galamsey, for example by funding a state agency to explore for gold and map areas for locals to mine.
But successive governments have been promising for years to tackle the problem without making much headway, partly because powerful people are benefitting from the industry, experts say.
Chris Aston, head of a British-backed programme aimed at regulating small-scale gold mining in Ghana, said artisanal miners were vulnerable to organised crime gangs, who provide them with funding for equipment up-front, unlike other lenders.
“Miner pre-financing is one way that organised crime groups can penetrate the gold supply chain,” he said. Funders then “require miners to sell the gold they mine back to them at a subsidised rate”.
Emmanuel Kwesi Anning, a security consultant based in Accra, said galamsey was fuelling an increase in gun-trafficking because those overseeing illegal mines sought armed protection against rivals or thieves.
He also said politicians and traditional rulers in some areas were taking a cut of galamsey profits, further entrenching the problem.
“It has become an elite consensus that they’ll not touch this business.”
Ghana’s information minister did not respond to requests for comments on the allegations of organised crime involvement, gun running and corruption.
A top official in the National Security Ministry, who did not wish to be named because they were not authorised to speak about the issue in public, said authorities were working to address the links between illegal mining, money laundering and gun trafficking.
LONDON (Reuters) -Oil prices fell on Wednesday after industry data showed inventories swelled more than expected, though futures were still up about 2% this week as traders factored in continuing conflict in the Middle East.
futures dropped $1.40, or 1.8%, to $74.64 a barrel by 1107 GMT. U.S. West Texas Intermediate crude futures also shed $1.40, or 2%, to $70.34.
Oil had settled higher in the previous two sessions, paring last week’s losses of more than 7%. Those declines stemmed from worries about Chinese demand and some easing concerns around Middle East oil supply being disrupted.
Wednesday’s price drop came after data showed U.S. crude stocks rose by 1.64 million barrels last week, according to market sources citing American Petroleum Institute figures on Tuesday. Analysts polled by Reuters had expected an increase of 300,000 barrels.
Official U.S. government oil inventory data is due on Wednesday at 10:30 a.m. EDT (1430 GMT).
But the inventories impact on prices was countered somewhat by persistent concerns over potential oil supply risk from conflict in the Middle East.
“The market continues to wait for Israel’s response to Iran’s missile attack,” ING analysts said on Wednesday, adding that Tuesday’s price strength was possibly because of the lack of any outcome from U.S. Secretary of State Antony Blinken’s latest visit to Israel.
Blinken pushed on Wednesday for a halt to fighting between Israel and militant groups Hamas and Hezbollah, but heavy Israeli air strikes on a large historic Lebanese port city demonstrated that there was no respite.
Israel on Tuesday also confirmed it had killed Hashem Safieddine, the heir apparent to late Hezbollah leader Hassan Nasrallah, who was killed last month in an Israeli attack targeting the Iran-backed Lebanese militant group.
“Market participants priced for the Middle East conflict to drag for longer, with a ceasefire deal potentially seeing some gridlock,” said IG market strategist Yeap Jun Rong.
Investing.com — Oil prices fell sharply Wednesday after industry data signaled an increase in U.S. oil inventories, while focus remained on diplomacy efforts by the U.S. to quell tensions in the Middle East.
At 08:05 ET (12:05 GMT), fell 1.6% to $74.80 a barrel, while fell 1.7% to $70.52 a barrel.
US inventories grew last week – API
Data from the showed that U.S. oil inventories grew 1.643 million barrels in the past week, compared with expectations for a build of 0.7 million barrels.
The , from the Energy Information Administration, is due later Wednesday, and could spur some concerns that U.S. fuel demand was cooling if it was to match these industry numbers.
Oil prices were also pressured by recent strength in the , as expectations of smaller interest rate cut by the Federal Reserve boosted the greenback to its strongest levels since early-August.
Crude, like many commodities, is denominated in dollars, and thus a stronger dollars makes it more expensive for foreign buyers.
Middle East conflict provides support
Crude prices gained some ground in the prior two sessions, paring last week’s losses of more than 7%., as tensions in the Middle East remained fraught after Israel said it had killed Hashem Safieddine, the heir apparent to the late Hezbollah Leader Hassan Nasarallah, who was killed last month by an Israeli strike.
U.S. Secretary of State Antony Blinken has held extended discussions with Israeli leaders this week over a potential de-escalation in the conflict, but his diplomacy has so far reaped few results.
“The uncertainty around how this plays out would leave speculators hesitant to be too short the market, something speculators had been before this most recent escalation, due to demand concerns and a bearish 2025 outlook,” said analysts at ING, in a note.
Oil to remain around $76/barrel in 2025 – Goldman Sachs
Oil prices are expected to average around $76 a barrel in 2025, Goldman Sachs analysts said in a recent note, with markets set to see a moderate crude surplus and spare capacity in major producers to offset any potential supply disruptions.
The investment bank said the risk premium for crude from tensions in the Middle East was limited, given that Iran-Israel tensions had so far not impacted oil supplies from the region.
Goldman analysts also noted that major producers in the Organization of Petroleum Exporting Countries, as well as their allies, had sufficient spare capacity. The cartel last week cut its oil demand forecast for 2024 and 2025, and is set to begin increasing production later this year.
(Ambar Warrick contributed to this article.)
By Ron Bousso
LONDON (Reuters) -Oil prices rose to $75 a barrel on Tuesday, extending gains from the previous session as investors weighed the impact of China’s stimulus measures to boost its economy, and concerns over tension in the Middle East persisted.
futures for December delivery rose 68 cents, or 0.92%, to $74.97 at 1033 GMT. U.S. West Texas Intermediate crude futures for November delivery were up 66 cents at $71.22 a barrel on the contract’s last day as the front month.
The more actively traded WTI futures for December delivery, which will soon become the front month, rose 70 cents, or 1%, to $70.74 per barrel.
Both Brent and WTI rose nearly 2% on Monday, recouping some of last week’s more than 7% decline, with no letup of fighting in the Middle East and the market nervous that Israel’s expected retaliation against Iran could disrupt oil supply.
U.S. Secretary of State Antony Blinken arrived in Israel on Tuesday, the first stop on a Middle East tour in which he will seek to revive talks to end the Gaza war and contain the spillover conflict in Lebanon.
“Crude oil prices have been fluctuating in response to mixed news from the Middle East, as the situation alternates between escalation and de-escalation,” said Satoru Yoshida, a commodity analyst at Rakuten Securities.
The market continued to weigh the implications for fuel demand of China’s stimulus measures and increased U.S. economic activity, he added
Beijing on Monday cut benchmark lending rates as part of stimulus measures to revive the economy as data last week showed it had grown at the slowest pace since early 2023 in the third quarter.
China’s oil demand growth is expected to remain weak in 2025 as the world’s No. 2 economy electrifies its car fleet and grows at a slower pace, the head of the International Energy Agency said on Monday.
Still, Saudi Aramco (TADAWUL:) is “fairly bullish” on China’s oil demand especially in light of the government’s stimulus package which aims to boost growth, the head of the state-owned Saudi oil giant said on Monday.
oil stockpiles likely rose last week, while distillate and gasoline inventories were seen down, a preliminary Reuters poll showed.
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