Ashanti Goldfields Company

Akabzaa T. M., Seyire J. S. & Afriyie K. Third World Network-Africa THE GLITTERING FACADE Effects of Mining Activities on Obuasi and Its Surrounding Communities Akabzaa T. M., Seyire J. S. & Afriyie K Published by Third World Network- Africa (TWN – Africa) Copyright © Third World Network – Africa (TWN – Africa) 2007 Third World Network – Africa (TWN – Africa) P.O. Box AN 19452, Accra – North, Ghana Tel : 233 21 500419 / 511189 / 503669 Fax : 233 21 511188 Email : [email protected] Website : www.twnafrica.org Design and layout by David Roy Quashie Printed by Royal Crown Press Ltd. ISBN : 9988- 602-25-1 Table of Contents Page Preface ................................................................................................ iii Executive Summary .......................................................................... vi Chapter One - Background to Study ................................................ 1 Chapter Two - Mining and the National Economy ......................... 7 Chapter Three - The Study Area ....................................................... 13 Chapter Four - Ashanti Goldfields Company .................................. 21 Chapter Five - Heavy Metal Pollution in the Study Area .............. 31 Chapter Six - Health Impacts ........................................................... 43 Chapter Seven - Perceptions of Communities on Mining Activities .................................................. 56 Chapter Eight - Conclusions and Recommendations ..................... 80 References ......................................................................................... 85 Appendix One - Letter of Request for Information ....................... 90 Appendix Two - Questionnaire for AGC ........................................ 91 Appendix Three - Questionnaire for the Local Communities .................................................... 102 Appendix Four - Focus Group Discussion Questionnaire ............. 114 Appendix Five - Validation Workshop Report ............................... 121 i Preface This book is based on findings from the second detailed research that Third World Network-Africa (TWN – Africa) has commissioned into the social and environmental impacts of gold mining in Ghana. The study focused on mining in Obuasi in the Adansi West district of the Ashanti Region. The choice of Obuasi is easily explained. Apart from Tarkwa it is Ghana’s best known mining town. For a century Obuasi has been the heart of the Ashanti Goldfields Company’s (AGC) imperium in imperio over 200km2. No Ghanaian town is under the sway of a mining company the way AGC dominates Obuasi which lies wholly within its concession. TWN-Africa’s first study covered the area around Tarkwa in Ghana’s Wassa West district, the area with the longest tradition of industrial gold mining in the country. That study resulted in the seminal book ‘Boom and Dislocation’. It made a significant contribution to changing public perception, in a more critical direction, about the impact of Ghana’s gold mining industry on the people living in communities affected by mining, the natural ecology as well as the national economy. For more than one hundred years the Ashanti Goldfields Company (AGC) mine at Obuasi, was the single most important gold mine in Ghana and one of the most profitable in the world. In the mid 1980s AGC, and at that time its single mine at Obuasi, led the inauguration of the current phase of Ghana’s mining industry based on a strategy of deregulation and privatisation of state owned assets and encouraging the expansion of foreign investment. From the injection of World Bank money in 1986 to revive and expand production at Obuasi AGC was launched on a course of expansion and diversification within Ghana and into other African countries. By the end of the 20th century it had developed into a transnational corporation listed on the Accra, London, New York, Sydney and Toronto stock exchanges. AGC’s growth and expansion was a central story in Ghana’s celebrated status as a model structural adjustment country in the 1990s. Obuasi’s contribution was key to the growth of gold exports which saw minerals overtake cocoa as Ghana’s main export earner in 1992. iii Was there another side to the glowing headlines about Obuasi’s contribution to the export recovery effort and the growing muscle of Ghana’s transnational mining company around the African continent? How were the benefits and costs of Obuasi’s operations being shared? One thing was striking by its absence from the narrative celebrating the AGC success story – what the people who lived in the villages in the shadow of the mine think of it all. One sad reality TWN-Africa has persistently encountered in its almost one decade of research and advocacy on mining issues is the way in which officialdom downplays the immense disruptions and sacrifices that Ghana’s gold mining boom has imposed on scores of communities and their inhabitants in the catchment area of the mines. Obuasi town shares one striking long term feature with Tarkwa – the startlingly wretched appearance of a town from where so much wealth has been extracted and the matching deprivation of the surrounding villages. With the current gold mining boom they came to share another feature- open cast mines and the qualitatively new ecological and social disruption they wreak. This report offers important evidence about the negative ecological and health impacts of mining, especially surface gold mining on communities and inhabitants around AGC’s Obuasi mine. Quite sometime has elapsed between the conclusion of the research in Obuasi and its publication in this form. TWN-Africa commissioned three researchers to investigate the impact of mining activities on Obuasi and its environs in 2003. The main body of the research was concluded in that year. However, some information used in this report such as data on diseases (used in Chapter 6) was provided by members of the Obuasi District Health Management Team to the researchers in 2004. Validation of the research findings at the community level was also carried out in 2005. In the time that has elapsed a number of important changes have taken place at AGC. The company was swallowed by Anglogold in 2004 resulting in a change of name to Anglo Gold Ashanti. This change in the mining company’s corporate struc- ture is not reflected in this publication. Other changes which are not reflected in this book because they took place after the conclusion of the main research work include the change of name of the Adansi West District to Adansi Municipal Council. However, changes in corporate ownership and adminis- trative nomenclatures that have taken place since the conclusion of the research do not in any way detract from the research findings, particularly the projection of the harsh effects experienced by several communities in Obuasi and its environs as a result of mining activities, especially the surface mining variety. iv Between the completion of the research in 2005, and this publication, the research findings have been published and used in a variety of forms before this definitive publication. For example they have served as the basis for dia- logue with the company’s management about the impact of its activities and what steps could be taken to deal with it. These findings are even more rele- vant today as the government has opened up protected forest reserves to mine for gold. Already, a number of communities and civil societies have protest- ed about the effects of these mining activities. These effects, as shown by this research, can be calamitous for the environment and affected communities. Like was the case with our Tarkwa research some eight years ago TWN- Africa offers this research report as its contribution towards the emergence of a more balanced appreciation of the impacts of Ghana’s gold industry; that as the country’s rulers woo investors they remember the thousands of lives and the environment which are negatively affected but do not often make the headlines. We are grateful to Dr. Thomas Akabzaa, Ms. Seyire and Mr. Afriyie for their research which has improved our knowledge about mining impacts in Ghana. Yao Graham, Ph.D Coordinator, TWN-Africa July 2007 v Executive Summary Under the guidance of the World Bank and the International Monetary Fund (IMF), Ghana has carried out profound structural adjustment of its economy to attract Foreign Direct Investment (FDI) over the last two decades. As part of this adjustment exercise, the country introduced radical changes in the minerals sector including the progressive revision of investment codes. A major aspect of this revision was a significant increase in investment incentives to foreign investors in the mining sector These incentives have resulted in increased investment in the sector. From 1983 to 2002, foreign direct investment inflow to the sector amounted to over US$6 billion. The huge investment manifested in a flurry of mineral explo- ration activities, the development of new mines and increased minerals output, particularly in the gold sub sector. These developments have reflected positively on the gross value of minerals won, with gold output increasing more than four times between 1990 and 2002. This boom notwithstanding, there is a growing dissension over the net benefits of these investments to the country as a whole, and to the communities directly impacted by mining in particular. The mining sector-related legal reforms focused disproportionately on promoting

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