Ghana to Lose $21m Annually from Lithium Royalty Slash – IMANI
By Praisebell Rosemond Larbi
Ghana risks losing about $21 million annually over the life of its first major lithium project following the government’s decision to reduce the royalty rate on the Ewoyaa Lithium Project from 10 per cent to 5 per cent, policy think tank IMANI Center for Policy and Education has warned.
In a new analysis of the revised 2025 Mining Lease Agreement, IMANI describes the decision as economically unjustified and cautions that it will significantly weaken Ghana’s ability to capture fair value from its critical mineral resources.
According to IMANI, the cut in royalty rates from what was initially negotiated to the statutory minimum, amounts to a direct transfer of wealth from the Ghanaian state to foreign shareholders. The think tank argues that the concession is not supported by the project’s underlying cost structure or prevailing market conditions.
Cost of the concession
IMANI explains that mineral royalties represent the state’s share of revenue from the exploitation of national resources. Reducing the royalty rate by half, it says, has clear and measurable fiscal consequences.
The analysis estimates that lowering the royalty from 10 per cent to 5 per cent effectively shifts about $60 per tonne of lithium concentrate away from the state. With projected annual production of approximately 350,000 tonnes, the revenue loss to Ghana amounts to $21 million each year, even before accounting for possible future increases in lithium prices.
IMANI notes that the fiscal impact could be even larger over time if prices rebound during the next commodity upcycle.
Challenging the viability argument
Government justification for the royalty reduction has centred on claims that falling global lithium prices rendered the Ewoyaa project unviable at a 10 per cent royalty rate. However, IMANI disputes this argument, citing figures from the company’s own Definitive Feasibility Study (DFS).
According to the analysis, the Ewoyaa project is among the lowest-cost lithium operations globally due to favourable geology and mine design. The project’s All-In Sustaining Cost (AISC) which covers mining, processing and preparation for sale, is estimated at just $610 per tonne.
IMANI argues that even under a stressed pricing scenario of $800 per tonne, the project would remain profitable, generating an estimated net margin of about $110 per tonne while still paying a 10 per cent royalty to the state.
The think tank further describes the price assumptions used to justify the cut as “phantom figures,” noting that as of early December 2025, lithium concentrate spot prices were trading significantly higher, in the range of $1,170 to $1,295 per tonne. At these levels, IMANI says, the project would retain strong profitability even with the higher royalty rate.
Call for renegotiation
IMANI concludes that the claim of project unviability at a 10 per cent royalty is “mathematically unsupportable” based on the company’s own data. It insists that the revised agreement represents a policy choice rather than an economic necessity.
To prevent long-term revenue losses, the think tank is calling for an urgent renegotiation of the mining lease to introduce a sliding-scale royalty regime, with a minimum floor of 10 per cent. Such a structure, IMANI argues, reflects international best practice and would allow the state to capture higher revenues during periods of strong commodity prices while remaining competitive during downturns.
The policy centre warns that decisions taken at this early stage of Ghana’s lithium industry will set a precedent for future critical mineral agreements, with lasting implications for public revenue, resource governance and national development.
