The 2024 annual report of the Public Interest and Accountability Committee (PIAC) has revealed that crude oil production declined for the fifth consecutive year in 2024.
The report explains that production dropped from a high of 71.44 million barrels in 2019 to 48.25 million barrels in 2024, representing a decline of 0.01 percent and a five-year average decline of 7.4 percent.
Total petroleum revenues for 2024 increased by 27.8 percent from US$1,062,323,419.12 in 2023 to US$1,357,793,869.40 in 2024.
The 2024 performance, which was mainly due to increase in pricing, also represents the second highest annual petroleum receipts since inception, with 2022 being the highest year (US$1.42 billion).
The PIAC report stated that the total proceeds from Ghana National Petroleum Corporation (GNPC) Explorco’s liftings received in 2024, amounting to US$145,681,117, was not paid into the Petroleum Holding Fund (PHF).
“This brings the cumulative proceeds of unpaid revenue into the PHF held by JOHL and subsequently GNPC Explorco to US$488,790,044.88 as at end of 2024. GNPC argues that proceeds from liftings by GNPC Explorco do not constitute payments into the Petroleum Holding Fund,” it said.
In the area of Surface Rental arrears owed by some International Oil Companies (IOCs), the report said the arrears remain high at US$2,893,120.29 as at the end of 2024. About 60 percent of these arrears are due to three companies whose Petroleum Agreements were terminated in 2021.
For the period under review, it said, there was no allocation of the Annual Budget Funding Amount (ABFA) to the Industrialisation Priority Area.
“This undermines the essence of prioritisation as envisaged by the Petroleum Revenue Management Act, 2011 (Act 815) as amended,” the report said.
It added “There is a worrying development where some loan obligations, initially borne by GNPC on behalf of the State in respect of Karpowership and Litasco guarantees, are being offloaded to GNPC Explorco. This will potentially saddle Explorco with debt and defeat its purpose as a solely commercial wing of GNPC capable of sustaining the Corporation when it no longer benefits from disbursements from the PHF.”
The report further observed that despite efforts by the Ministry of Energy to attract investments into the Upstream Petroleum Industry, there was no Petroleum Agreement signed in 2024.
“This is the fifth consecutive year that no Petroleum Agreement has been signed since 2018,” it said.
In its recommendations, the report said, ” Government should expedite action to attract investments into Ghana’s upstream petroleum industry. The Committee reiterates its position that proceeds from liftings by GNPC Explorco constitute indirect participation of the State and therefore must be paid into the Petroleum Holding Fund.
“The Ghana Revenue Authority, the Petroleum Commission, the Bank of Ghana and the Ministry of Energy should collaborate to recover the Surface Rental arrears. Government should determine specific programmes for implementation over the course of Priority Areas before selection of the Priority Area. Parliament should ensure that the Ministry of Energy and its allied agencies increase efforts to secure investments into Ghana’s upstream petroleum industry.”
Source: 3News
