The Minerals Income and Investment Fund (MIIF) is contemplating an investment of GH₵300 million in the Ada-Songor Salt project, which is operated by Electrochem Ghana Limited, a subsidiary of the McDan Group of Companies.
This investment is contingent upon Electrochem Ghana Limited making its shares available for trading on the Ghana Stock Exchange (GSE). If this condition is met, it has the potential to transform a vast 41,000-acre facility into the largest salt industrial complex on the African continent.
This requirement highlights MIIF’s dedication to promoting growth and transparency in the extractive sector, as explained by its Chief Executive Officer, Edward Nana Yaw Koranteng.
He stated that the Fund is actively exploring the possibility of investing in the project. The envisioned injection of GH₵300 million into the Ada-Songor salt project, he emphasized, will not only revolutionize the salt industry in the country but also establish a new benchmark for salt production in Africa.
“We are still working out the process; it is not a done deal. We are currently going through the due diligence processes, including ‘know your client’ (KYC) while collaborating with other transaction advisors to ensure the success of this transformative deal,” he said.
He emphasized that the significance of this potential investment cannot be overstated. Industrial salt, he pointed out, has an extensive range of approximately 14,000 applications. These applications encompass crucial sectors such as pharmaceuticals, bicarbonates, and oil and gas, among others.
Furthermore, he indicated that the development of a robust industrial salt sector is poised to catalyze economic transformation by bolstering domestic industries, reducing imports, and promoting self-reliance.
The CEO of MIIF disclosed this information during a stakeholder forum in Accra, which was centered around the theme “MIIF as a lever for development in Ghana, investing in a responsible, transparent, accountable manner to secure the future wealth for Ghana.”
MIIF is the sovereign fund for minerals established by the Minerals Income Investment Fund Act, Act 978. Its primary purpose is to serve as a strategic tool to maximize the value creation potential of the mining sector for sustainable national development.
The Fund’s mandate includes managing the country’s equity interest in mining companies and receiving dividends from these equity interests, receiving mineral royalties and other related income owed to the state from mining activities, and overseeing the management and investment of these funds.
It’s worth noting that President Nana Akufo-Addo recently inaugurated the US$88 million salt production plant in Ada, Greater Accra Region. This newly established facility has the potential to position salt as a leading export commodity to the African market under the African Continental Free Trade Area (AfCFTA) agreement. It is projected to contribute about US$2 billion to the economy in the short-to-medium term, making it a significant source of foreign exchange by 2026 when the Ada Songor Salt project reaches full completion.
Initially capable of producing one million metric tonnes of salt annually, the project is set to scale up to approximately two million tonnes by 2025. In the long run, when all phases are fully completed, the concession has an ultimate capacity of 15 million tonnes per year.
Considering salt’s critical role in ensuring food security and advancing industrialization across the African continent, the 15 million capacity long-term target is expected to meet the demand of many countries on the continent, with Ghana and Senegal standing out as the only countries in West Africa with natural salt minerals.
Chairperson-McDan Group of Companies, Daniel McKorley, had told B&FT that with deliberate efforts and the right financial facility, “we can easily scale up this project to 15 million m/t per annum in five years”.
“With the completion of this phase one, we are currently creating about 3,000 jobs. And the most important thing is that it doesn’t require a degree to work here; this is the kind of job that members of this community need. About 98 percent of the workforce here will not require a degree to work, and that is what creating jobs means for a country like Ghana,” he said earlier this year.