Gold production in Ghana in 2021 is expected to grow by about 9 percent, the biggest growth rate in years.
This is expected to push the volume of gold produced in Ghana to 4.65 million ounces next year according to a report by Global market analysis outfit Fitch Solutions.
The increase in gold production will help Ghana maintain its position as Africa’s largest gold producer in 2021, after surpassing South Africa in terms of gold production in 2019.
According to Fitch Solutions, significant growth in Gold production in Ghana will be driven by the Phase 2 completion of AngloGold Ashanti’s Obuasi Project.
AngloGold poured first gold at the Obuasi mine in December 2019 during Phase 1 of the project, and in October 2020 the firm reported that Phase 2 of the project is 68.4% complete.
The firm currently expects to achieve a steady state of operation in 2021, increasing Ghana’s gold production by approximately 350-400k oz per year during the first 10 years of Obuasi’s mine life.
Price of gold on the global market which begun the year around $1.500 an ounce and hovering around $1,900 an ounce, is expected to boost the attractiveness of Ghana’s mining investment environment.
Gold worth about $4.3 billion according to data from the Bank of Ghana was exported from the country between January and August 2020.
In addition, the Fitch Solutions report states that elevated gold prices on the back of global economic uncertainty will bolster gold mining investment in Ghana.
Gold prices have rallied in 2020 amid the Covid-19 pandemic, and Fitch Solutions states that a second wave of the virus in Europe and the United States, is prompting a widespread reinstatement of lockdown and preventative measures which will dampen investor sentiment going into 2021.
This development should support demand and prices of safe haven assets including gold.