Ahafo Gold Mine, Ghana - Newmont's Return to Africa Continues a Long-Term Relationship

Newmont Mining, one of the world’s largest gold mining firms, sought IFC’s help in managing the financial and social risks of its return to Africa after a four-decade hiatus. With IFC’s assistance, Newmont aimed to reach high operational standards in a difficult region in order to obtain a social license to operate. The company needed a long-term partner with regional experience, particularly on environmental and social issues facing mining companies in Africa.

IFC responded by structuring loan financing for its own account and that of participating banks, advising on environmental and social issues, and helping set up community development programs.

  • Financing – IFC arranged a $125 million loan with an exceptionally long maturity of 12 years. IFC’s risk appetite and political risk cover convinced commercial banks to join the consortium.
  • Environmental and Social Advice – IFC supported a complex resettlement process affecting close to 10,000 people, working with two social specialists in Ghana. Backed by a team of environmental specialists, industry experts, and communications officers, IFC gave advice on the restoration of livelihoods, helped to commission independent studies, and supported Newmont with best practice advice on community consultations.
  • Local Supplier Development – Initially Newmont faced unrealistic expectations among local people for a large number of mining jobs. IFC helped respond by contributing to a supplier program that enables local entrepreneurs to deliver goods and services to the mine. This small and medium enterprise linkage program creates jobs, improves the competitiveness of local businesses, and enhances regional business associations’ ability to support their members. World Business Council for Sustainable Development Case Study on Ahafo Linkages Program.
  • Gender Empowerment Program – IFC is helping Newmont promote female employees in their mining operations and supporting female small business development in nearby communities.
  • HIV/AIDS Program – IFC partnered with Newmont in developing comprehensive HIV/AIDS awareness programs for staff and local communities.

IFC was a natural partner for the project, thanks to its mining expertise in Africa and a long-standing relationship with Newmont.

  • 1993: $26 million in IFC and syndicated commercial loans, 5 percent IFC equity investment – Yanacocha gold mine (Peru)
  • 1994: $20.5 million IFC and DEG loan – Yanacocha mine
  • 1999: $60 million IFC and syndicated commercial loans – Yanacocha mine
  • 2006: $125 million IFC and syndicated commercial loans – Ahafo mine

The Ahafo gold mine, with IFC’s support, is having a positive impact on the people of Ghana and setting best practices in responsible mining and community development. It is creating jobs in remote regions of the country, providing education and skills training, generating government revenues through royalty payments, and yielding returns for investors and project sponsors.