Emerita Professor Ardayfio-Schandorf addressing the journalists at the media engagement held in Koforidua
Koforidua, Eastern Region//-Ghana’s fourth consecutive times of oil production decline since its commercial production began in 2010 has raised concerns about the viability, sustainability, and future of the sector.
However, members of the Public Interest Accountability Committee (PIAC) said the downward trend of oil production could be reversed if the government and other relevant regulatory bodies take progressive steps.
Addressing journalists at a two-day media engagement in Koforidua, Chairperson of PIAC, Emerita Professor Elizabeth Ardayfio-Schandorf, added: “Government and the relevant regulatory bodies should take the appropriate steps to reverse production decline on existing oil fields and ensure investments in unexploited fields”.
Another way that the country would continue to be in the oil business is by ensuring that there are new Petroleum Agreements.
While securing fresh agreements is essential for attracting investment and ensuring the long-term sustainability of Ghana’s oil production, according to her.
Highlighted on the 2023 PIAC’s report, Emerita Professor Ardayfio-Schandorf said the Ghana Revenue Authority (GRA) needs to intensify its efforts to recover the Surface Rental arrears with the usual default penalties applied. Surface Rental owed by international oil companies (IOCs) remain high at US$2,738,365.29 as at the end of 2023, she said.
The report revealed that development and production costs continue to be significantly high in the TEN Field, while production remains low by more than three million barrels, as compared to Sankofa Gye-Nyame (SGN) even though there is no drilling in both Fields.
Other Key findings from the report
Crude oil production declined for the fourth consecutive year in 2023. Production dropped from a high of 71.44 million barrels in
2019 to 48.25 million barrels in 2023 representing an annual average decline of 9.2 percent.
The total proceeds from JOHL liftings received in 2023, amounting to US$70,456,718.93, were not paid into the Petroleum Holding Fund (PHF) for the second consecutive year. This brings the cumulative proceeds of unpaid revenue into the PHF by JOHL to US$343,108,927.88 as at end of 2023.
The retention of the current cap of US$100 million on the GSF for the year 2023 did not follow the formula stipulated in L.I 2381. A proper application of the formula would have returned a cap of US$581.05 million. The current cap does not help build the Fund to serve its purpose.
Call to action
Moving forward, it is important for all stakeholders involved in the management and utilisation of petroleum revenues to work together to ensure that investment is attracted to Ghana’s sedimentary basins.
Also, there is the need for increased exploratory activities to be conducted by IOCs to increase the chances of making finds and increasing the producing fields and revenues, the report admonished.
