


The Natural Resource Governance Institute (NRGI), an international civil society organisation, is demanding that Bavari DV, a subsidiary of Atlantic Lithium, provide further particulars to back its demand for fiscal concession.
The demand follows an appeal made by the lithium mining company to the government for fiscal concessions that would affect government earnings in the yet to be ratified agreement for Ghana’s first lithium-producing mine.
Atlantic Lithium Limited, an Australian based mining firm, in a press release, said the fiscal concession would ensure the successful development of the Ewoyaa Lithium Project, amid decreasing global prices of lithium.
“Since the Ewoyaa mining lease was granted in October 2023, lithium prices have declined significantly. Accordingly, the Company has engaged key stakeholders, including government representatives, to discuss fiscal terms that reflect the current lithium price environment. Discussions remain ongoing,” it said.
It is, among other things, requesting for the downward revision of the corporate income tax of 35 per cent and the removal of import duties on capital equipment.
At a media engagement, Mr Denis Gyeyir, the Country Director of NRGI, however said it was important for government to ensure that any request for fiscal concession was grounded in economic feasibility.
He noted that Atlantic Lithium must clarify how it arrived at its new post-tax internal rate of return (IRR) estimate of 13.6 per cent and justify any adjustments it made to its assumptions, down from a previously projected 94 percent before debt financing.
“Not doing so risks undermining public trust and its social license to operate, storing up trouble for the project later,” Mr Gyeyir said.
In the wake of a declining price of the commodity, he proposed that government should opt for a sliding scale royalty regime that ensured that royalty rate for mining concession was adjusted in proportion to the changes in prices of the commodity on the global market.
He urged government to avoid granting concessions that applied even when profits were high.
According to NRGI, while current lithium prices posed challenges for the Ewoyaa project, industry analysts did not expect the downturn to last.
“Lithium has been more volatile than other minerals in recent years, and while prices are unlikely to return to the 2022 peak of $8,500 per tonne, there is consensus that they will rise again as global demand increases,” the organisation said in a publication.
The publication was titled: “Atlantic Lithium’s Request to Ghana for Ewoyaa Fiscal Concessions Requires Scrutiny”.
Source: GNA
The post NRGI demands scrutiny of fiscal concession request for Ghana’s lithium appeared first on Ghana Business News.
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