A comprehensive evaluation by the Tender Committee of the Minerals Commission recommended Engineers and Planners Limited (E&P) as the indigenous company to assume operations of the Damang Mine following the exit of South Africa-based Gold Fields.
But the story of how E&P won the lease goes far beyond a routine business transaction. In fact, it was a rigorous stress test of administrative discipline, technical prowess and financial muscle.
Four firms originally competed for the lease. What followed was a thorough three-stage evaluation process that left no room for mediocrity.
Here is a clear breakdown of how and why E&P finally secured the deal.
The administrative responsiveness
First, the government publicly announced in the media that it was inviting strategic investors to apply for the lease and operation of the Mine. Just so you know, government currently retains a 10% free carried interest of the Mine pursuant to Section 43 of the Minerals and Mining Act, 2006.
Four companies responded to the bid. They included Engineers and Planners Limited, Heath Goldfields Limited, Maripoma Mining Services Limited and Vortex Resources Mining Group.
This first phase involved mandatory requirements which simplified the field. The Tender Committee required six elements.
One was proof of wholly owned Ghanaian registration with clear beneficial ownership. The others were Valid tax, SSNIT and VAT clearance certificates plus a valid certificate of incorporation and payment of a GHS 100,000 non-refundable application fee.
Maripoma Mining Services Ltd and Vortex Resources Mining Group were disqualified at the starting line. Why? These two companies failed to submit the mandatory documents required to support their application. That rendered their tenders non-responsive. In the world of high-stakes mining, failure to provide even a single piece of statutory paperwork is a terminal error.
Only Engineers and Planners and Heath Goldfields successfully complied.
The technical bridge
With only two contenders left, the evaluation moved to technical proposals. This stage carried a massive 80% weighting in the final decision. What this even means is that, to be considered for the final stage, a company had to meet a minimum qualifying score of 80% in the technical assessment.
The criteria were exhaustive to ensure the operator had the capacity to manage a complex gold mining operation.
Key elements included:
- Relevant Experience (50 points total). This was further broken down into technical/general experience (40 points) and applicant information (10 points).
- Methodology and Work Plan (10 points): Including quality control and methods statements.
- Key Staff Qualifications (10 points): The human capital behind the machinery.
- Facilities and Equipment (10 points): The physical assets available for deployment.
- Safety, Health, and Environment (SHE) Standards (10 points): Compliance with modern ESG requirements.
- Local Content (10 points): Ensuring the mine benefits the Ghanaian economy.
It was here that Engineers and Planners effectively won the lease. E&P delivered a dominant performance. It scored a total of 95.4%.
Their strengths were particularly evident in Technical and General Experience, where they secured 38.6 out of 40 points and in Facilities and Equipment, where they swept the category with 9.8 out of 10.
For Applicant Information 10/10, Methodology 9/10, Staff 9.6/10. They scored 9.2 out of 10 each in Safety and Local Content.
By contrast, Heath Goldfields Ltd faltered significantly. Their technical submission totalled only 63.4%. They struggled specifically in the experience categories by scoring only 18.4 out of 40 for technical experience and scoring 5.8 out of 10 in equipment.
For Applicant Information 8.2/10, Methodology 6.2/10, Staff 9.2/10. They scored 6.2 and 9.4 out of 10 in Safety and Local Content respectively.
Suffice to say, because Heath Goldfields failed to hit the mandatory 80% technical threshold, the Committee never opened Heath Goldfield’s financial proposal.
The financial mobilisation
Well, the tender notice specified that the winning investor must demonstrate access to funding between $500 million and $600 million for project development.
Engineers and Planners removed any doubt regarding their financial solvency by providing documentary evidence of $505 million in available financing from two major financial institutions – ABSA Bank and Stanbic Bank. This satisfied the prescribed financial capacity requirement.
The final calculation was a matter of arithmetic. E&P’s scores were weighted as follows:
Weighted Technical Score: 95.4 (out of 100) multiplied by the 80% weight = 76.32.
Weighted Financial Score: The committee calculated their $505 million backing against the maximum required USD 600 million.
This resulted in a score of 16.83 out of the maximum 20 available for the financial pillar.
When combined, Engineers and Planners achieved a Total Technical and Financial Score of 93.15%.
The obvious verdict
When all factors are considered, Engineers and Planners emerged victorious because they were the only bidder to successfully combine strict administrative compliance with a detailed technical work plan and verified multi-million-dollar financial backing.
Consequently, in accordance with Regulation 263 of LI 2176, the Tender Committee declared Engineers and Planners the successful and highest-evaluated tenderer.
The Committee subsequently recommended the company to the Minister for Lands and Natural Resources for the grant of the Damang Mining Lease.
The recommendation has received ministerial approval.
