GNPC Holds on to $100Million Oil Proceeds Meant for the Ghanaian Treasury - Africa’s premier report on the oil, gas and energy landscape.

GNPC Holds on to $100Million Oil Proceeds Meant for the Ghanaian Treasury

Ghana National Petroleum Corporation (GNPC) is holding, in its account, about $100Million that should otherwise have been paid to the country’s Petroleum Holding Fund.

The money is part of the proceeds of crude oil export in the first half of 2022.

Following the acquisition of 7%, interest in the Jubilee and TEN Oilfields by GNPC in 2021 (later ceded to its subsidiary, Jubilee Oil Holding Limited – JOHL), reports the Ghanaian Public Interest Accountability Committee (PIAC), “JOHL made its first lifting (944,164bbls) on the Jubilee Field in the First Half 2022, amounting to $100,748,907.95. This amount was not paid into the Petroleum Holding Fund (PHF)”.

The PIAC, in its just released 1H 2022 report, recommends that “the proceeds of liftings by JOHL should be paid into the Petroleum Holding Fund (PHF), as the Committee is convinced that the proceedsform part of Ghana’s petroleum revenues”.

The PIAC also notes that “Capital Gains Tax was not assessed and collected by the Ghana Revenue Authority in the sale of the 7% interest by Anadarko in the Jubilee and TEN Fields in 2021”, and when the committee requested for explanation, “the Ghana Revenue Authority referred the Committee to the Ministry of Finance indicating that the Ministry was exclusively in charge of the transaction. The Ministry of Finance in turn referred the Committee to the Ghana Revenue Authority for answers”.

The lack of assessment of Capital Gains Tax of upstream asset sale by revenue authorities in the land was “contrary to Section 6(e) of the Petroleum Revenue Management Act, 2011 (Act 815)”, PIAC maintained.

The 186-page report observes an overall tardiness in petroleum revenue collection in 1H 2022. “Surface Rentals outstanding continue to increase”, it points out. “As at the end of H1 2022, the balance outstanding was $2,774,702.29 constituting an increase of 7.58% percent on the surface rentals of $2,579,170.21 at the end of 2021.

“The Ghana Petroleum Funds received an amount of $390,029,916.55 for the H1 2022, which is 91.43% percent higher than the budgeted allocation of $203.75Mllion for the GPFs for the full year in compliance with Section 4(a)(iii) of the Petroleum Revenue Management (Amendment) Act, 2015 (Act 893).

“The retention of the current cap of $100Million on the GSF for the year 2022 is not in accordance with the formula stipulated in the Petroleum Revenue Management Regulations, 2019 (L.I. 2381). A proper application of the formula would have returned a figure of $460,633,074.02.

The PIAC is an independent statutory body mandated to promote transparency and accountability in the management of petroleum revenues in Ghana.



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