An electrical technician who stole six single-phase prepaid electricity meters belonging to Ghana’s electricity distribution and retail company, Electricity Company of Ghana (ECG) and sold them has been convicted and sentenced by a circuit court in Accra, capital of Ghana.
The 27-year –old, John Afadi, was convicted on his plea of guilty to eight counts, including interfering with the ECG system and stealing.
He was fined 400 penalty units, representing GH¢4,800 or in default spend two years in hard labour in prison.
Graphic.com.gh reports that the court, which was presided over by Mrs. Afia Agbanu, asked Afadi to pay GH¢2,000 as compensation after hearing the facts of the case.
Fact
The Manager of the ECG Prosecution Unit, Mr Paul Assisi Abariga, told the court that the Kasoa North District Technical Officer of ECG alerted the police after he received complaints from some individuals who claimed ECG meters installed in their homes developed faults shortly after it had been installed by Afadi.
He said in a April 2019, Afadi sold and installed a meter to the first victim at a cost of GH¢800 but the victim found that the meter was not working so he contacted Afadi to find out why but he failed to solve the problem.
In the same month, Afadi sold another meter at a cost of GH¢1,000 to the second victim and it was also found to be faulty.
The third victim also bought a meter from Afadi at GH¢1,060 while Afadi also sold a meter to the fourth victim at the cost of GH¢1,200.
The court heard that when the buyers detected the faults on the meters and contacted Afadi, he failed to fix the problem and avoided their calls.
They reported the matter to the Kasoa North District of the ECG separately and they were told the meters were stolen ones.
On November 23, 2019, Afadi was arrested and when searched, two single-phase meters were found on him.
He was handed over to the Investigation Unit of the ECG in Accra where he was processed and put before the Accra Circuit court.
Souce: www.energynewsafrica.com
The African Energy Chamber has referred to Africa as the hottest frontier globally in terms of oil exploration based on several discoveries made over the few years.
The world’s largest discovery this year was made of the Mauritanian coast by KOSMOS Energy to add up to other discoveries made by Equatorial Guinea’s Noble Energy and Springfield Group of Ghana in West Africa.
The Chamber revealed that in 2020, hundreds of blocks and acreages will be up for grab across the continent from Senegal to Nigeria to Somalia.
These were contained in the organisation’s latest African Energy Outlook 2020, which also called for sustained fiscal reforms to attract capital and technology into exploration in the continent.
In 2020, the competition will be fierce to attract capital from a diversifying basket of explorers now coming from North America, Europe, Russia, China, India, South East Asia and the Middle East.
The outlook mentioned that several African countries revised their legal and fiscal framework in 2019, to incentivise exploration, as new world-class discoveries were yet again made on the continent.
With the signing of no less than 9 PSCs in 2019 following the passing of its brand new Hydrocarbons Code, the outlook added that Gabon in Central Africa, has shown that investors are ready to keep betting on Africa, provided that the right legislation and framework are put in place.
However, the Chamber stressed on concerns raised by investors over uncertain fiscal terms in sub-Saharan Africa.
To this end, it called on governments to find better ways to reconcile their expectations of short-term tax gains with the need for sustainable and long-term investment in exploration.
The importance of increasing exploration efforts cannot be under-estimated in Africa, the outlook stressed.
According to NJ Ayuk, the African Energy Chamber Chairman, who doubles as CEO for Centurion Law Group, “2020 needs to be a drilling year and that Africa has the highest exploration success rates in the world.
“In basins like the MSGBC, international explorers like Kosmos Energy have even had a 100 percent success rate from all their exploratory drilling,” he added.
“It is up to African governments and legislators to provide the right framework to keep attracting these kind of players ready to take risks and bet on our continent’s potential.”
Promoting and supporting exploration efforts across the continent is a key goal of the Chamber in 2020, as stated in its latest outlook for the sector.
Source:www.energynewsafrica.com
Africa Oil & Power, the continent’s premier platform for energy investment and policy, is set to return to Angola in 2020 to host the next edition of Angola Oil & Gas(AOG) from June 16-17, 2020 in Talatona.
Surrounding the conference will be a year-long global drive to present opportunities to a targeted audience of relevant investors.
Endorsed by the Ministry of Mineral Resources and Petroleum and in partnership with the African Energy Chamber, the Angola Oil & Gas (AOG) Conference & Exhibition will be the focal point of an international investment drive aimed at bringing new deals to the table and signing up new entrants to Angola’s oil and gas sector.
“Thanks to the President’s sweeping reforms, Angola has embarked on an ambitious drive to attract foreign direct investment,” Guillaume Doane, CEO of Africa Oil & Power said.
“Africa Oil & Power is proud to support those ongoing efforts with a global promotional campaign. The AOG Conference & Exhibition, which has become an unmissable, unrivaled national investment event, will provide a strong anchor point for the 2020 initiative.”
Capital inflows into bankable projects will be a primary objective of the 2020 effort. Ongoing initiatives being promoted include the 2020 oil and gas licensing round, marginal field development, gas monetization, Sonangol’s Regeneration Program and attractive projects across the value chain, including the international tender for the Soyo refinery and the ramp-up of the Cabinda and Lobito refineries.
The 2020 event aims to expand in size, scale and prestige. Anchored by a VIP program of senior government officials and global CEOs, AOG 2020 will be the premier gathering for deal making and networking.
Discussion points will include offshore oil and gas exploration and licensing, gas monetization, market entry, the ease of doing business in Angola, digitalization and oilfield technologies.
New to the conference will be a Digitalization and Technology forum, which will showcase advanced technologies pioneered in Angola on the exhibition floor.
The Executive Chairman of the African Energy Chamber and CEO of the Centurion Law Group, Nj Ayuk, has been named as one of the top 100 most influential Africans in 2019 by NewAfrican Magazine.
Providing a rapid review of some of the major events and developments across Africa, the Most Influential Africans (MIA) listing highlights key achievements of African individuals across geographies and industries this year.
The listing notably includes personalities and executives from sports such as Siya Kolisi, key politicians such as President Nana Akufo-Addo or Prime Minister Abiy Ahmed, and movers and shakers of the business world such as Aliko Dangote and Ibukun Awosika.
Described as an “energy broker”, the listing highlights Nj Ayuk’s voice in offering remedies for the continents’ resource curse and praises his best-seller on Amazon, Billions At Play: The African Energy and Doing Deals for offering a comprehensive road map for Africa to do a better job at using its vast natural resources to fuel economic growth and improve the lives of millions of Africans.
“It is humbling, to be honored but in my heart, I know you did not buy into our message just for me, you did because you believe in what Africa and Africans can be. We should never apologise for being Pan African and Pro Africa,” declared NJ Ayuk. “This is proof that the message of the African Energy Chamber and Billions At Play: The African Energy and Doing Deals that energy must work better for Africans is being heard,” he added.
Others featured on the list include Akinwumi Adesina, President of the African Development Bank; Marcia Ashong, Founder and CEO of The Boardroom Africa; Trevor Noah, Comedian and Political Commentator; Mark Bristow, CEO of Randgold Resources; Strive Masiyiwa, Businessman and Philanthropist and Tonye Cole, co-founder and former Group Executive Director of Sahara Group; Benedict Oramah, President of Afrieximbank to name a few.
Source: www.energynewsafrica.com
The Chief Executive Officer of Ghana’s power transmission company, GRIDCo, Ing. Jonathan Amoako-Baah, has committed to addressing the issues raised by workers of the company in relation to unpaid debts by some of its bulk customers.
Staff groups of the power transmission company in the West African nation last Tuesday hit the streets of Accra, Ghana’s capital city to express their displeasure about the inability of Electricity Company of Ghana (ECG), Volta Aluminum Company (VALCo) and Northern Electricity Distribution Company (NEDCO) to settle their debts totaling some GHS1.2billion.
These payments have been outstanding for sometime now and has caused GRIDCo to fall behind on some of its debt obligations.
Currently, French development partner, Agence Française de Development (AFD), has suspended disbursements of a US$170 million facility to the GRIDCo due to its inability to meet the payment terms.
Ing. Jonathan Amoako-Baah, CEO of GRIDCo
Speaking at a Long Service Awards event for 151 staff in Tema, Ing. Amoako-Baah said: “Management has taken note of recent staff agitations in the media and is very committed to addressing the issues raised. High stakeholder engagements are ongoing to find solutions to the company’s current financial situation. We place a high premium on our responsibility to protect the interest of staff and we will not renege on our fiduciary duty.”
GRIDCo’s current financial situation has stifled ongoing capital projects such as the expansion of its power export capacity to neighboring Burkina Faso.
Meanwhile, the company has served notice that it will not countenance unethical behavior from staff such as absenteeism, misappropriation of company property for personal use and leakage of confidential corporate information.
The CEO, speaking at the same event, said the company is taking active steps to promote a sustainable work environment by upholding honesty, integrity and accountability.
Source:www.energynewsafrica.com
Global oil producers are meeting in Vienna, Austria, for the 177th OPEC Meeting.
Through the meeting, the producers will aim to determine the management of oil production in 2020.
In a statement, the African Energy Chamber urged African OPEC and non-OPEC members to commit to the Declaration of Cooperation and ensure compliance.
“This is of key importance as it keeps the path to dignity and prosperity for African economies open,” the statement said.
The meeting falls amidst the climate change debate which has put pressure on the global energy industry to implement less carbon-intensive energy solutions.
Attending the 177th Meeting, the Africans see this gathering as an opportunity for OPEC members to focus on the realities of energy poverty on the African continent and provide a solution that allows Africa to still meet its objectives of improving power access and building competing economies while participating in the dialogue about addressing climate change.
“Climate change is real. At the African Energy Chamber, we do not reject its existence and impact on the environment, instead, we are determined to express the importance of Africa’s progress not being halted particularly when it is progressing towards its summit,” NJ Ayuk, Executive Chairman of the African Energy Chamber and author of Amazon best-seller, Billions at Play: The Future of African Energy and Doing Deals, said.
“There must be a dialogue between businesses and governments about the future of the global energy industry, but, African business must be on the table. Accounting for 7.3 percent of global oil reserves and 7.2 percent of global gas reserves, Africa should have a voice,” added Ayuk.
Last week, the African Energy Chamber launched a petition against the proposition that in the wake of the climate change debate, Africa should limit the development and exploration of its full hydrocarbon potential.
This, it has done not as a means to reject the realities of climate change, but rather as a plea to be given the same opportunity as our western counterparts to develop and industrialise our countries.
Secretary General of OPEC, H.E. Mohammad Sanusi Barkindo said earlier this year that: “The oil industry must be part of the solution to the climate change challenge. The scale of the challenge means that no single energy source is a panacea; nor can the contribution of an entire industry or group of countries be overlooked. This is not a race to renewables alone; it’s a race to lower greenhouse gas emissions.”
Namibia’s national power utility company NamPower has announced plans to build two wind farms that will be located near the coast in the Tsau//Khaeb (Sperrgebiet) national park, southwest of the country.
The first wind farm will be developed by NamPower with an investment of $68 million once a meteorological mast (metmast) determines the annual energy production capacity over the next year.
If wind measurements are deemed viable then it is anticipated that 16 wind turbines will be installed, producing 40MW.
The second wind project will be developed as part of a public-private partnership (PPP) through a competitive bidding process. The independent power producer that wins this concession will be responsible for building a 50MW wind farm.
The power will be sold to NamPower under a Power Purchase Agreement. “After 12 months of data collection and formal tendering for specifications in the market, the project can begin. Studies are underway at the sites,” Ernst Krige, senior engineer at NamPower said.
Krige added that the choice of companies, after a thorough review, will depend in particular on the project’s environmental impact management model since the wind turbines will be built in the Tsau//Khaeb (Sperrgebiet) national park.
The bird and bat study is particularly critical as there are a large population of larks and alario canaries in the area.
Shell has won a court ruling that blocks the enforcement of more than a half a billion dollars for damages against the oil supermajor in a decade-old oil spill case in Nigeria.
A Nigerian court ruled back in 2010 that Shell was liable for an oil spill in the Ejama-Ebubu community in 2001, and awarded the sum plus interest to the community.
Shell, which has fought several lawsuits over oil spills in the Niger Delta in the 1990s and early 2000s, has also sought to have the cases transferred to Nigerian courts instead of in UK courts.
The Ejama-Ebubu community, however, had the award claim registered in London, which could have potentially meant that UK courts could enforce the award against Shell.
But UK judge Jason Coppel set aside the registration on Thursday, thus preventing UK courts from enforcing the award.
A lawyer for the Nigerian community told Bloomberg they would appeal today’s UK court decision, while a Shell spokesman said that the supermajor continues to believe that “no payment was due” in the case that is still being tried in Nigerian courts.
Shell and its Nigerian unit have also been dragged through the courts over the supermajor’s alleged complicity in abuses of human rights in Nigeria’s military suppressing protests in the oil-rich Niger Delta in the 1990s, especially in the Ogoniland area.
In early 2018, the UK Court of Appeal ruled that Nigerian communities cannot pursue Shell in UK courts over oil spills in the oil-rich Niger Delta, upholding a previous High Court ruling that UK-based multinational companies cannot be tried in England for the actions of their subsidiaries overseas.
The Nigerian villagers claim that they have been severely affected by years of oil pollution from pipelines owned by Shell and that both the London-based parent company, Royal Dutch Shell Plc, and its Nigerian subsidiary SPDC are responsible for the pollution.
Libya’s El Feel oilfield has been shut down, due to an unlawful closure of a valve on an oil export pipeline, Libya’s National Oil Corporation (NOC) has revealed.
This is the second time in two weeks that the oilfield has been shut down.
The 73,000-barrels-per-day El Feel field was shut down in the middle of last week due to airstrikes, after the eastern-based Libyan National Army (LNA), led by Khalifa Haftar, retaliated after forces loyal to the UN-backed Libyan government in Tripoli allegedly took control of the oilfield in the southwest.
“Production will remain shuttered until military activity ceases and all military personnel withdraw from NOC’s area of operations,” NOC chairman Mustafa Sanalla said last week after the airstrikes on El Feel.
A day later, military activity at the field stopped and production resumed, NOC said, with Sanalla noting that Libyan oilfields are vital sources of revenues for the country and that the fields “must not be treated as military targets.”
Sanalla who described the situation as worrying said that “This is another criminal attempt to disturb the work of NOC and it harms the Libyan economy. We call on the local leaders and authorities in the area to identify the offenders.”
Speaking to reporters at the OPEC meeting in Vienna on Thursday, Sanalla told Reuters: “Unfortunately we lost 73,000 barrel per day today.”
Libya’s oil production was volatile in the spring and summer after Haftar—whose forces control most of Libya’s oilfields—ordered in early April his Libyan National Army to march on the capital Tripoli.
Two outages at the biggest oil field, Sharara, in one month forced Libya’s oil production down to below 1 million bpd in the first week of August—the lowest level in five months.
Libya’s production stabilized and even increased in September and October—to 1.16 million bpd and 1.167 million bpd, respectively, according to OPEC’s figures. Yet, Libya is exempted from the OPEC+ production cuts due to its fragile security situation.
Brazilian national oil company, Petrobras, plans to invest $75.7 billion over the next five years, sell up to $30b worth of assets, boost production, and add to its decarbonisation efforts.
Petrobras said that of the full $75.7 CAPEX sum the 2020-2024 period, 85% would be spent on the E&P segment, mostly on oil-rich pre-salt areas in ultra-deep waters – between 1900 and 2400 meters – with the pre-salt reservoirs themselves located in depths of over 7000 meters in some cases.
“This allocation is in line with our strategic positioning, focusing on E&P assets, especially in the pre-salt, in which Petrobras has a competitive advantage and generates more return on investments,“ Petrobras said.
Worth noting, this five-year plan is a downward revision of the five-year plan released by Petrobras last year, when the company said it would spend $84 billion dollars between 2019 and 2023.
The divestments under the new plan are expected to be between US$ 20-30 billion for the 2020-2024 period, with the highest concentration of divestments planned in the years 2020 and 2021.
During the five-year period, Petrobras expects to bring online 13 new production systems, all of which are allocated to deepwater and ultra-deepwater projects.
The company also presented a graph in which it showed that oil production is expected to rise, boosted by pre-salt production.
Petrobras’ oil and gas production forecast (Chart by Petrobras)
“For the 2020 production target, we consider a variation of plus or minus 2.5%. The oil production in this year mainly reflects losses in volumes related to the natural decline of mature fields and a higher concentration of production stoppages to increase the integrity of the systems, partially offset by the ramp-up of new platforms. In the long term, the growth trajectory is supported by the new production systems – mostly in the pre-salt, with higher profitability and value generation – and by Campos Basin production stability,” Petrobras said.
Decarbonization commitments
Petrobras’ plan also includes efforts aimed at reduction of its carbon footprint. The company has said that it has already advanced with a series of decarbonization actions in its processes, which involve reducing the flaring of natural gas, reinjection of CO2, and gains in energy efficiency.
“The company maintains its commitment to the decarbonization of processes and products, with a robust action plan in relation to carbon resilience and efficiency,” Petrobras said, revealing its plan which includes ten commitments for the low carbon and sustainability agenda:
Zero growth in absolute operating emissions by 2025 (Carbon commitments related to 2015 base. Other commitments based on 2018.)
2. Zero routine flarings by 2030
3. Re-injection of 40 MM ton CO2 up to 2025 in CCUS projects
4. 32% reduction in carbon intensity in the E&P segment by 2025
5. 30%-50% reduction in methane emission intensity in the E&P segment by 2025
6. 16% reduction in carbon intensity in the refining segment by 2025
7. 30% reduction in freshwater capture in our operations with a focus on increasing reuse by 2025
8. Zero increase in residues generation by 2025
9. 100% of Petrobras facilities with a biodiversity action plan by 2025
10. Maintenance of investments in socio-environmental projects
Brazil’s state-run oil company, Petroleo Brasileiro SA, hopes to boost its value by nearly 50 percent by 2021, in part by putting more offshore oilfields up for sale.
The oil assets in question include stakes in one of Brazil’s largest oilfields, the Marlim field, parts of the Papa-Terra field, its Bolivian assets, petrochem firm Braskem SA, and its remaining stake in BR Distribuidora.
The parts of the Marlim field could fetch as much as $4 billion, while Braskem SA could net as much as $3 billion, Petrobras executives said in a presentation on Wednesday.
If Petrobras succeeds in divesting these assets, it would add billions to its existing divestment program as it scrambles to get out from under its mountain of debt and focus on deepwater exploration in the pre-salt zone, where the majority of its expenses will be focused in the coming years.
But the success of the asset sales is uncertain at best. Petrobras tried to ditch its 36 percent stake in Braskem years ago but failed. Odebrecht, the other holder of Braskem, also tried to ditch its share in the petrochemical firm. It, too, came up empty-handed.
Petrobras has a plan to reduce its gross debt to $60 billion by 2021, according to Nasdaq. It has a five-year plan to divest between $20 billion and $30 billion between 2020 and 2024, with plans to increase its production to 2.7 million barrels of oil equivalent per day by 2020, and 3.5 million barrels of oil equivalent per day by 2024.
Other parts of the company’s five-year plan include total capital expenditures of $75.7 billion, 85 percent of which will be allocated to its exploration and production segment.
Oil major Shell has won a court order against Greenpeace aimed at preventing environmentalists from boarding the company’s oil installations in the North Sea.
In October 2019, Greenpeace protested on the Shell –operated Brent field in the North Sea against the company’s plans to leave parts of old oil structures with 11,000 tonnes of oil in the North Sea.
Following the protest, Shell sought an order from the Edinburgh court to ban protests near the company’s platforms.
Following reports that Shell has won the injunction, Offshore Energy Today reached out to Shell seeking confirmation and further details about the order.
A Shell spokesperson said: “Shell sought this court order only to prevent protestors breaching the statutory 500m safety zones around platforms in the Brent field, putting themselves and Shell staff at risk. We wholeheartedly support the right to protest peacefully and safely. We’re pleased this decision recognizes that the existing legal safety zone should be respected by campaigners.”
Shell called on Section 21 of the Petroleum Act 1987, which automatically establishes 500-meter safety zones around installations which are stationed, being assembled or being dismantled in waters within the UK Continental Shelf. Under the act, it is an offense for any vessel to enter or remain in the safety zone except in accordance with regulations made by the Secretary of State or a consent given by the Health and Safety Executive.
BBC reported that the judge had concluded that since the installations were private property, Shell had a legal right to stop the climate activists from accessing them. The news agency also reported that the judge had ruled that given the physical state of the installations, protesters could injure themselves.
A setback for Greenpeace
In a statement on Wednesday, Greenpeace confirmed that the Scottish Court had granted Shell’s request for a temporary ban on future protests by Greenpeace International and Greenpeace Netherlands near or on Shell’s oil platforms in the Brent oil field.
Responding to the court order, Meike Rijksen, Campaigner for Greenpeace Netherlands said: “This is a setback, but the public will understand the real concern here is Shell’s plan. We will continue to fight alongside experts and governments against Shell’s intention to dump 11,000 tonnes of oil in the North Sea. Greenpeace has almost 50 years of experience with safe and peaceful protest. We strongly believe in the right to protest and will keep defending it. Shell can try to shut us up, but we will only get louder.”
Michelle Jonker-Argueta, Legal Counsel for Greenpeace International stated: “Currently we are waiting for the written ruling. Then we need to thoroughly analyze it before making any decisions about a possible appeal. In any event, Greenpeace will get to fight for the right to hold the industry accountable through safe and peaceful protest when the court considers Shell’s request for a permanent ban.”
According to Greenpeace, a ban on dumping installations and platforms in the North-East Atlantic Ocean was agreed in 1998 by all members of the OSPAR Commission. Shell has requested an exemption from the UK government. Both the Dutch Government and the German Government have criticized Shell’s plan and came to the conclusion that Shell’s study into the complete dismantling of the platforms is inadequate.
Source: www.energynewsafrica.com
Oilfield services provider Halliburton has notified the Oklahoma Office of Workforce Development that it would dismiss 800 employees, the Oklahoma agency’s spokesman David Crow tells The Associated Press as oilfield services firms continue to cut costs amid slowing U.S. shale growth.
Halliburton sent a letter to the Oklahoman agency, announcing “mass layoff” of 808 employees in what is expected to be permanent job cuts in El Reno, Oklahoma. The company is also closing an office just outside Oklahoma City.
The facility which Halliburton is closing served as the command center for Halliburton’s Remote Operations to monitor well completions across all of Oklahoma and areas in Colorado, Kansas, and Texas, according to The Oklahoma.
El Reno’s mayor Matt White told The Oklahoman that Halliburton’s decision to permanently eliminate more than 800 jobs did not come as a complete surprise, because officials had expected potential layoffs for some time amid slowing activity in Oklahoma’s oil and gas sector.
Earlier this year, the U.S. shale patch started to brace itself for an extended period of weak oil prices and drillers and oilfield services firms began to cut staff and reduce budgets to weather the slowdown in North America’s fracking growth.
Two months ago, Halliburton said it would lay of 650 workers across four U.S. states—Colorado, New Mexico, North Dakota and Wyoming—due to “local market conditions.”
“Making this decision was not easy, nor taken lightly, but unfortunately it was necessary as we work to align our operations to reduced customer activity,” Halliburton said in early October.
Ten days later, Halliburton’s president and CEO Jeff Miller said on the Q3 earnings call that the firm stacked more equipment in Q3 than it did in the first six months of 2019.
“While this impacts our revenues, we would rather err on the side of stacking than work for insufficient margins and wear out our equipment,” Miller said, and noted “We continue to evaluate the way we work and we’ll keep reducing costs in our North American operations.”
Source:www.energynewsafrica.com
Misplaced Priorities
Up until May 2019, Ghana had a total 43 percent stake in the AGM/Aker Energy Block Petroleum Agreement (PA), made up of Carried and Participating Equity Interests of 25 percent and a Commercial Interest of 24 percent of the remaining 75 percent; equivalent to an additional 18 percent. The government of Ghana had to reduce the official State share in the Block (which could hold billions of barrels of oil equivalent), citing the inability of GNPC to raise money to fund its interest for development and production. As a result, Ghana’s Additional Interest was reduced from 15 percent to 3 percent, Explorco’s interest was converted from 24 percent to 5 percent, and Carried Interest increased from 10 percent to 15 percent; to bring Ghana’s total Equity Interest to a paltry 18 percent.
The effect of this significant reduction of Equity Interest for the GNPC and the State, is the potential loss of over 250 million barrels of recoverable oil production equivalent (net to Ghana), which is almost the size of the entire Jubilee Field. This is equivalent to about US$15 billion (assuming a conservative $60 net per barrel) in direct revenues into the Consolidated Fund and transfers to GNPC.
According to PIAC 2019 Semi Annual Report, GNPC on two occasions was unable to lift crude oil in respect of CAPI on the SGN Field due to the Corporation’s inability to honor outstanding payments (plus interest) in respect of its equity participation in the field.
Aside losing out on the AGM/Aker Energy Block and the lifting of SGN Field cargos, the GNPC has lost out on many opportunities to move it closer to the strategic goal of becoming a “Stand-alone Operator, for lack of cash. Same GNPC had complained that it is having a funding deficit exceeding GHC1.2billion. Yet on daily basis one can find a blatant abuse of its funds which flows from the petroleum revenues. The entity has become a second-tier government, financing projects such as roads that ordinarily should have be financed by national budget. The GNPC have been undertaking questionable Corporate Social Responsibility (CSR) activities and expenditures, while foregoing vital opportunities to increase the country’s earnings from its hydrocarbons.
The deviation from its core functions is really worrisome and makes the entity unattractive. The GNPC ordinarily should be able to make enough money and pay dividend to the state by now. But since Ghana discovered oil in 2007 it has been spoon-fed by the petroleum revenues. The payments from the Petroleum Holding Fund (PHF) to GNPC are to cater for the cost of financing its activities in relation to the interest it holds in petroleum agreements, and not to be used in achieving political goals.
It would be quite challenging for GNPC to remain financially independent and sustain its operations when the State weans it off the petroleum revenue in the next few years. As a result, the advances and guarantees by GNPC to government and other State-owned Enterprises (SOEs) must cease, so the GNPC can focus on the hydrocarbons to generate more revenue for the State, and to sustain its operations. The current over-politicization of GNPC, may make the Corporation unattractive to potential partners and investors, and unable to achieve its strategic goals.
Ghanaians were highly optimistic at the time of Ghana’s oil discovery in 2007, having hope of GNPC driving the country’s new found wealth to catapult it into the economic tiger of Africa. The expectations were anchored on what other National Oil Companies (NOCs) are doing with the black gold in other countries like Norway, Saudi Arabia, Brazil, Algeria, Angola et cetera. But the GNPC of today has left little to be hopeful of.
Stakeholders in the petroleum sector fear GNPC may veer off its mandate completely if pragmatic steps are not taken to realign them to their major objective of exploring and producing hydrocarbons in the interest of the State. The year 2019 is almost at a close, and there is no sign of GNPC coming close to its overarching strategic goal of becoming a “Stand-alone Operator” by 2019. And not until it maintains its focus on hydrocarbons, none of its goals can be achieved, and within a reasonable timeframe supposing it achieves the goals.
Written by Paa Kwasi Anamua Sakyi, Institute for Energy Security ©2019
The writer has over 22 years of experience in the technical and management areas of Oil and Gas Management, Banking and Finance, and Mechanical Engineering; working in both the Gold Mining and Oil sector. He is currently working as an Oil Trader, Consultant, and Policy Analyst in the global energy sector. He serves as a resource to many global energy research firms, including Argus Media and CNBC Africa.
