We’ll fight state capture of the oil sector – Alex Mould
There seems to be no end in sight for the controversies surrounding our oil sector as a former Chief Executive Officer (CEO) of the Ghana National Petroleum Corporation (GNPC) Mr. Alex Kofi-Mensah Mould has promised to fight what he calls “State Capture of the Oil Sector” in the country.
This comes after IMANI Ghana made claims of underhand dealings and conflict of interest within Ghana’s oil sector.
At a public forum organized by the Caucus for Democratic Governance (CDG) in Accra recently, Alex Mould said that many foreign oil services companies that have existing Ghanaian local partners in their joint ventures before 2017 have been marginalized in getting business contracts approved, getting their licenses renewed on a timely basis, or have been “persuaded” to change their local partners all by the powers that be using government institutions like the Petroleum Commission.
This disturbing trend, he said, is made worse by the fact that it is alleged that there is some agreement between Government of Ghana (GoG) – either directly or indirectly, through the Petroleum Commission – and Aker, where Aker, in its $4bn development of the pecan discovery, will be allowed to use its “preferred” vendors in its contracting strategy rather than go through the tender process as prescribed by law.
“If this is so, then Aker, being essentially an oil services company and not a known oil E&P Company, could basically capture most of the lucrative initial contracts in the development of the Pecan field which is estimated to be somewhere close to $4.0bn and to be completed within 3 years. It also means that these “preferred” vendors/companies could be encouraged to now form local partnerships with companies that have little or no expertise in the industry as there is no transparent local content procedure and no tender process.
All these will have the blessing and support of the Petroleum Commission which is also allegedly being controlled by very high ranking and powerful individuals who are in the President’s inner circle.
If these FRONTS (local partners), most of whom have no expertise are even given 20% local content participation in each contract that means that almost $800m worth of contracts will accrue to these local companies.
Given that the average net profit in the industry is 20%, it means that these local companies are set to make north of $150M in profits over the next 3 years. Which will not create a fair and level playing field for the numerous oil services companies that Ghana’s industry lured to invest billions in people and assets over the last decade”, he observed.
The former CEO of GNPC believes that these directives would benefit the powers that seem to control the oil sector, rather than benefit the country as a whole in achieving the goals of the regulations Legal Instrument LI 2359 (2018, Petroleum regulations).