Ghana assumed operational control of Gold Fields’ Damang mine in April 2025 after rejecting the South African company’s application to renew its lease, marking what government officials described as a critical step in the country’s economic reset. The parties reached an agreement on April 24, granting Gold Fields a 12 month extension to continue operating the mine, with parliament expected to ratify the arrangement in May 2025.
The government’s initial lease rejection broke decades of automatic license renewals in Ghana’s mining sector. Officials cited regulatory and operational shortcomings, including Gold Fields’ failure to declare verifiable mineral reserves in its lease renewal application and the absence of required technical program details. The Ministry of Lands and Natural Resources characterized the decision as ending what it termed neo colonial practices in mining license renewals.
Gold Fields had ceased active mining operations at Damang in 2023, focusing solely on processing existing stockpiles while pursuing end of life options for the site. The facility produced 135,000 ounces of gold in 2024, representing approximately six percent of Gold Fields’ total output of 2.15 million ounces. Industry observers note that Damang remains significantly smaller than Tarkwa, Gold Fields’ other Ghanaian operation and the country’s largest open pit gold mine.
The timing of the lease dispute coincided with extraordinary movements in global gold markets. Gold reached its 45th all time high of 2025 when it hit $4,000 per ounce on October 8, climbing from $3,500 to $4,000 in just 36 days. Prices have risen more than 50 percent in 2025 alone, propelling the metal from under $2,000 in early 2024 to over $4,000 in October 2025.
This price surge transformed the economics of operations like Damang. Assets that appeared marginally viable at lower gold prices suddenly represented significant potential value. J.P. Morgan Research forecasts prices will average $3,675 per ounce by the fourth quarter of 2025 and climb toward $4,000 by mid 2026, while Goldman Sachs analysts project gold could reach $4,850 per ounce by late 2026.
The rally has been fueled by strong investment demand amid geopolitical tensions, dollar weakness, U.S. Federal Reserve (Fed) cut expectations, and equity and bond market risks. Central bank demand remains robust, with around 900 tonnes of purchases forecasted for 2025. China, Turkey, and India have accelerated purchases to insulate themselves from U.S. sanctions and trade volatility.
Under the renegotiated agreement, Gold Fields will take all reasonable steps to restart open pit mining at Damang during the 12 month lease period, with the Minister of Lands and Natural Resources providing necessary support in obtaining requisite permits. The company will progress and finalize a detailed bankable feasibility study by the end of 2025 to extend the mine’s operational life.
A joint asset transition team comprising representatives from both parties will oversee the eventual transfer of Damang to Ghanaian ownership. President John Mahama emphasized that increased local participation and ownership in Ghana’s mining industry forms a key part of government policy to create wealth for citizens. Gold Fields Board Chair Yunus Suleman noted the company’s 30 year history in Ghana and commitment to sustainable economic contribution.
The Damang developments do not affect Gold Fields’ operations at Tarkwa mine, which continues normal production. The company will commence preparation of applications for Tarkwa mine lease extensions due for renewal in 2027.
The case illustrates how commodity price movements can rapidly alter the strategic value of mining assets. What appeared to be an exhausted operation facing closure became a contested resource as international gold prices reached historic levels. The government’s approach signals intent to maximize national benefit from mineral resources while maintaining an investment friendly environment for mining companies willing to commit to local development priorities.
