IMANI Africa President Franklin Cudjoe has welcomed aspects of the amended lithium agreement laid before Parliament but says the proposed royalty structure still disadvantages Ghana.
Reacting to the development in a social media post, Cudjoe acknowledged the decision by the Lands and Minerals Minister to adopt a sliding scale royalty regime, describing it as a product of sustained civil society pressure.
“We see the Lands and Minerals Minister has laid an amended lithium agreement before Parliament on the last day Parliament rose for the holidays. First off we acknowledge the Minister’s decision now to adopt the sliding scale for royalty with the 12% maximal bound as a starting victory for CSOs activism. We thank the Minister,” he said.
Despite the concession, Cudjoe criticised the choice of a 7 percent starting royalty, arguing that prevailing market conditions do not justify such a rate.
“Sadly though he went for a 7% royalty starting rate when the price of lithium is higher today, ($1200 per tonne) with the investor’s production per tonne being $610 translating into a near 45% profit margin,” he stated.
He pointed out that the same investor had previously been willing to accept stricter terms under less favourable conditions.
“In 2024, the same investor was prepared to sign the agreement when its profit margin was less than 20% based on outreach price of $800 per tonne with a production cost of still $610 per tonne and a royalty rate of 10%,” Cudjoe added.
Cudjoe also challenged figures attributed to the Minister, saying the data used to justify the royalty framework was flawed.
“The Minister’s figures he presented in an interview he granted for the basis of a start off royalty of 7% at $3000 per tonne as of 2024 are inaccurate,” he said, adding that comparisons made with gold royalties were equally questionable.
