More could be lost rather than gained unless the government of Ghana reconsiders the planned tariff increases on its mining sector, a mining company warns.

"The tax situation is a big concern," Nick Holland, Chief Executive Officer of Gold Fields Ltd., said on Monday during a presentation in Johannesburg. "Frankly, unless we can see some flexibility on tax, I don't see the projects built as proposed, if at all," he said, referring to plans to expand the Damang and Tarkwa mines.

"Both of those projects represent incremental investment of $1 billion into the country ... There needs to be a better dispensation for us to proceed," he said.

Ghana's government had announced it plans to raise the corporate mining tax to 35 per cent from the present 25 per cent, as well as introduce a 10 per cent windfall tax. The suggestions were put to the Ghanaian National Assembly in November as part of 2012 budget plans.

Holland argued there seems to be a misconception that gold companies are pocketing huge profits. Its projects in Ghana, Tarkwa and Damang released operating profits for the last quarter amounting to $US269 million, but these were mainly due to the increased bullion price and cost savings, he said.

Ghana is the latest African commodity producer devising measures to benefit from the higher world prices for its products. According to the central bank, gold exports from the country in the nine months to September amounted $3.7 billion. Ghana pocketed $91 million in royalties in the same period.

Other African countries like Zambia had doubled royalties on minerals, while Guinea and Zimbabwe have sought greater stakes in mining assets. Global market prices of the yellow metal have risen 23 per cent in 2011.

Gold Fields is the world's fourth-largest gold producer and regards West Africa as key to its global growth strategy. The miner aims to increase production output from 0.9m ounce level in West Africa to 1.25m ounces by 2015. The increase is to be driven by three projects: a super pit at its Damang operation, expansion at Tarkwa and the Yanfolila project in Mali.

In 2010, 20 per cent of the company's production of around 3.5 million ounces came from Ghana.

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