.jpg)
Crude oil production declines for 3 consecutive years – PIAC report
The 2022 annual report of the Public Interest and Accountability Committee (PIAC), the committee set up by an Act of Parliament to monitor petroleum funds utilisation, has revealed that crude oil production has been declining for three consecutive years.
A volume of 71,439,585 barrels was produced in 2019, but declined to 66,926,806 barrels in 2020, representing 6.32 percent, the report said.
The production further declined to 55,050,391 barrels in 2021 representating 17.75% and then to 51,756,481 barrels in 2022 also representing 5.98%.
The average decline over the three-year period is 10 percent the report stressed.
Regarding revenue collection and management, the PIAC report indicated that total petroleum revenue in 2022 was the highest for a single year since inception of petroleum production in Ghana with a figure of US$1.43 billion.
But surface rental arrears continued to rise.
It increased from US$2.58 million in 2021 to US$2.77 million in 2022, 65 percent (US$1.80 million) of which is owed by four contractors whose Petroleum Agreements were terminated in 2021.
The report noted that efforts made by the Ghana Revenue Authority (GRA) to retrieve the arrears were yet to yield the desired results.
“There is the need for Ghana to speed up the sustainable development of its petroleum resources to reverse the decline in petroleum production through the attraction of new investors as well as early completion of ongoing projects,” the report recommended.
It added “GRA needs to intensify its efforts in the collection of Surface Rental arrears, particularly the amount owed by the four contractors whose Petroleum Agreements were terminated in 2021.”
Crude oil receipts by JOHL group, a subsidiary of GNPC, should be paid into the Petroleum Holding Funds since it forms part of Ghana’s petroleum revenue, the report so recommended.
“In the disbursement of funds to the District Assembly Common Fund (DACF), the Minister for Finance should comply with the decision of the Supreme
Court of Ghana in the case of Kpodo and Another vs Attorney-General in 2019.
Having rightly selected Industrialisation as a Priority Area, the government should show more commitment by investing
more in industrial development.
“The Minister for Finance should comply with the relevant provisions of L.I 2381 in determining the cap on the GSF, in
order that the Fund would be able to cushion the economy in times of unanticipated petroleum revenue shortfalls.”
Leave A Comment