The Public Interest and Accountability Committee (PIAC) is advocating a review of some laws regulating Ghana’s petroleum sector especially its oil production to eliminate potential threats such as the growing discussion on energy transition and the impact of the African Continental Free Trade Agreement (AfCFTA).
PIAC which disclosed this in its assessment report on 10 years of petroleum revenue management in Ghana noted these threats could impact on both local and international activities.
The report emphasized a review on local content legislation, a situation that has already begun affecting revenue generation from the sector.
Addressing participants at the launch of the report, Chairman of PIAC, Professor Kwame Adom Frimpong called on stakeholders to intervene as soon as possible with some reviews to both policies and regulations in the petroleum upstream sector to forestall the situation.
“We shouldn’t forget the African Continental Free Trade Agreement is in existence and that the local content regulations must be re-looked at as soon as possible. Also the recent conversations on the energy transition which has begun impacting on revenue inflows from the sector must also be taken into consideration because production will be heavily affected”, Prof Adom – Frimpong indicated.
A Deputy Minister of Energy, Andrew Agyaper Mercer admitted challenges exist and assured that work has begun to correct most of the issues raised.
“Indeed it’s a good observation, but some of these calls are coming a bit too late because we have done some reviews to some of the regulations and more are ongoing. So we can accommodate some other concerns” he said.
The report also revealed that Ghana earned about $6.55 billion from oil and gas production by the end of 2020, equivalent to 9.97% of the country’s Gross Domestic Product.
Out of this amount, the Annual Budget Funding Amount (ABFA) has been allocated the highest amount of $2.6 billion (40%) over the period followed by the Ghana National Petroleum Cooperation (GNPC) which received $2.0 billion (30%).
The Ghana Stabilisation Fund (GSF) received $1.39 billion (21%) of total revenues; whereas the Ghana Heritage Fund (GHF) has received $586 million (9%) of the total allocation.