Determinants of Net Cash Flow of Mining Companies in Ghana


  • Cosmos Adubofour Antwi Department of Management Studies, University of Mines and Technology, Tarkwa, Ghana
  • Dennis Amponsah Baidoo School of Business and Economics, Atlantic International University, Honolulu, USA



Net cashflow, Random Effect Estimation, Gold Price, Large Scale Mining, All-in-Sustaining Cost.


Large scale mining is a capital-intensive venture that creates high-paying jobs and provides support for host community infrastructural development as well as adequate stimulation of the economic growth of a country. The sustainability of every mining company is significantly dependent on its ability to generate positive net cashflow from its core operations. This study therefore investigated the determinants of the net cash flow of 3 major operating mines in Ghana; namely, Newmont, AngloGold Ashanti, and Goldfields Mining Companies from 2008 to 2020. The panel data analysis method employed for this study is the random effect estimation. The empirical findings from the study revealed that gold price and quantity of gold produced had strong positive and significant effect on the net cashflow of mining firms. On the contrary, All-In-sustaining cost and royalties were found to have negative and significant effect on net cashflow. Furthermore, Tax payment and crude oil price both had positive, but insignificant effect on the net cash flow of the mining firms. Finally, US inflation had a negative, but insignificant effect on the net cashflow. Production improvement initiatives such as improvement of overall equipment efficiency (OEE) and minimisation of financial wastes along the mining value chain were recommended. The study also recommended the short to medium term hedging of highly volatile mining inputs, which are significant cost drivers such as fuel and reagents, and long-term minimisation of the cost of mining operations through process optimisation as well as process innovations at all times to achieve positive margins aimed at improving upon the net cashflow generation of mining companies and subsequently creating value for their shareholders whiles contributing to economic growth in their countries of operation.



How to Cite

Cosmos Adubofour Antwi, & Dennis Amponsah Baidoo. (2023). Determinants of Net Cash Flow of Mining Companies in Ghana. International Journal of Financial Accountability, Economics, Management, and Auditing (IJFAEMA), 5(1), 35-51.