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Exton Cubic Group Exited: Did The Owners Know Their Days Were Numbered?

If you’re a stranger in Jerusalem, then you wouldn’t know that there exist mundane Mosaic laws.

Eleventh-hour contract deals often don’t turn out well. We’ve seen such drama play out many times in many parts of the world. The reason, they tend to be mired with problems such as conflict of interest, companies/individuals not meeting terms of reference or requirements or not following due process. But they usually occur when governments from different political parties take the wheels of power.

Thing is, many forget that such contracts aren’t ironclad. In other words they aren’t chiseled on concretes slabs and for that matter they can be canceled or abrogated by new administrations through enactments at any time. I think former president Kufuor signed one of such contracts in 2008 at the dying embers of his tenure. However, that contract had a safe berth. It must be the Ghana Telecom (GT) contact which was sold to British telecommunication giant Vodafone at a cost of US $900 million (454 pounds) for a 70 per cent stake in the telephony company.

On Monday 4 September, 2017 John Peter Amewu, Minister of Lands and Natural Resources, announced at a news conference in Accra that Exton Cubic Group Limited ---a mining company owned by businessman Ibrahim Mahama a junior brother of former president John Mahama could not meet all the legal requirements to prospect for bauxite at Nyinahini in the Tano Offin Forest Reserve in the Ashanti region; and therefore the ‘lease cannot hold’.

The Monday’s announcement therefore, cancels the earlier directive for the company to move to the Nyinahin forest for the mining of bauxite.

Mr. Amewu said the NPP administration was acting in accordance with Section 87 of Act 703 of the Minerals and Mining Act, 2007 to cancel the multi-billion bauxite concession granted Mr. Ibrahim Mahama.

“The failure to obtain an Environmental Permit, Operational Permit, as well as the various statutory infractions, leading to the purported grant of the three Mining Leases to the company, render the purported leases invalid and of no effect,” he told the press.

Bruce Pardy a law professor at Queen’s University Kingston Ontario Canada wrote: “Government contracts are contracts. In the normal course of events, their terms may be canceled, the Crown held liable for the breach. However, government contracts are not ironclad agreements they appear to be because governments may change or cancel them by enacting legislation.”

His statement was contained in a Fraser Research Bulletin, under the topic: Cancelling Contracts: The Power of Governments to Unilaterally Alter Agreements’.

As I aforementioned this isn’t peculiar to Ghana. In August this year (2017), the Trump administration cancelled a contract solicitation that would have handed the management of the Federal government US$1.2 trillion portfolio of education loans to a single company. The cancellation, according to Washington Post sparked complaints from industry stakeholders.

Speaking at a press conference Mr. Amewu, who had earlier been accused of allowing Ibrahim’s company into the Nyinahin Forest Reserve in the Atwima Mponua District of the Ashanti Region to start exploratory activities, said “Exton Cubic was supposed to provide an Exploration Operating Permit for the year 2017, an Exploration Operating Plan to the Minerals Commission but none of the above was fulfilled.”

Did the owners know their days were numbered?
There appeared to be a silver lining from the onset so I doubt if they got a wind of what was to come.. The Lands minister had openly said that the company had permits and satisfied all requirements. And on that basis he granted Exton Cubic the permission to carry on its activities in the designated forests. But that was short-lived. This would trigger seizure of the company’s equipment, war of words and threatening of lawsuits. Nonetheless, the cancellation looked inevitable.

“The absence of publication in the Gazette of a notice of the pendency of the company’s applications and service of the notice on the various entities specified in the law is contrary to both Section 13(2) of Act 703 and Regulation 177 of L.I 2176,” he noted.

The minister said the three mining leases included Kyekyewere (56.64 sq.km), Mpasaso (22.46 sq.km) and Kyirayaso (32.68 sq.km), adding that his attention was drawn to an attempt by the company to enter the concession on August 20 and therefore he decided to investigate that information.

Upon the investigation he said, it was established that Exton Cubic Group Limited had not complied with the mandatory laid-down procedures required to enter the concession. At this point the last option on the table was abrogation.

Commenting on the issue, Prof. Frimpong Boateng, Minister of Environment, Science, Technology and Innovation, pointed out that it’s every governments priority to promote local industries.

“Every government wants to promote indigenous Ghanaian businesses .The laws are laws. This is not a political thing. This government works with the law and infractions are infractions. Nobody can say that this is a political witch-hunt. The minister mentioned a lot of infractions… so you can go through and you will know that we are not after any individuals. I will be the last person, and I am sure the president will be the last person to hunt Ghanaian business people,” prof. Boateng submitted.

Top of FormMeanwhile a staunch critic of Ibrahim Mahama Mr. Kennedy Agyapong MP for Assin Central has urged the NPP government to tamper justice with mercy, suggesting government should allocate a portion of the bauxite concession to embattled company, Exton Cubic Ltd to mine.

“Government should meet them [Exton Cubic] half way because they’ve also invested, we’re all Ghanaians. I think 56.64cubic metres for only one company is also too much. Let’s give some of the concession to Ibrahim and spread the rest among others who have the capacity to mine the bauxite so that the proceeds stay here in Ghana for the country to develop.”

The NPP MP made the plea while speaking with Adom FM a local radio station based in Tema.

So in case you’re still wondering as to what’s going on, I tell you what: let cool heads prevail. This is just a new normal so don’t fret much. Contracts get cancelled if and when they’re deemed shady or smack fishy. I’m pretty sure the GT-Vodafone deal would have been annulled if the Mills administration had suspected any wrongful act regarding its sale.

Also I think it’s important for the general public particularly those in the other side of the political divide to understand that some of these events are inevitable. And I should add that if we really want our democracy to grow and be like the Americans and the Brits then we must as well welcome these political bumps (as l like to describe them) in good faith.

The ugly fact is they may not be palatable, depending on who’s at the receiving end. But I believe if we’re able to handle them properly when they erupt they will go a long way to deepen and strengthen our democracy. And this advice isn’t for the minority NDC alone it’s meant for all the political parties in Ghana. And mind you, it’s imprudent to sign contracts that are deemed controversial at the eleventh-hour. So let’s try to avoid them going forward.

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