The effect of mismanagement of revenue from the country’s oil find has begun impacting negatively on some agencies under the Ministry of Energy and Petroleum. Despite the crucial role it plays in the regulation of the petroleum sector, the Petroleum Commission was not given any budgetary allocation in this year’s budget.
This means that activities of the country’s oil and gas regulatory body have now been put on hold, since there are no funds to prosecute them.
Ironically, the government blew US$112 million of the country’s oil cash on capacity building on oil and gas in 2012 alone, at the time budgetary allocations for the Ministries, Departments and Agencies (MDAs) had generally been cut down to about 50% of the amount they initially requested.
The Petroleum Commission regulates and monitors the management and utilisation of Ghana’s upstream petroleum resources on behalf of the government.
It ensures optimal utilisation of existing and planned petroleum infrastructure, so that contractors, subcontractors and other persons involved in petroleum activities comply with the applicable laws and regulations.
The Commission is also responsible for receiving petroleum data, manage a national petroleum database, and at the request of the Minister, undertake reconnaissance exploration, including data acquisition, assess applications and issue permits for specific petroleum activities, as required under the petroleum laws and regulations.
The Commission, which assumed its regulatory functions effective May 1, 2012, was not captured in last year’s budget, but was allocated an amount of GH₵5 million by the Ministry of Finance to run its activities. With this, many experts had anticipated a budget allocation for the regulatory body in the 2013 Budget, but to no avail. It was not clear what accounts for that anomaly.
Worried about this occurrence, the Chairman of the Committee on Mines and Energy, Dr. Kwabena Donkor, in presenting the 2013 Annual Budget Estimates of the Ministry of Energy and Petroleum on the floor of the House yesterday, proposed a budget allocation of GH₵24,122,010 for the activities of the Commission.
“In recognition of the critical role played by the Commission in regulating the upstream petroleum industry, the Committee is calling on the Ministers of Finance and Energy to coordinate and find a mechanism for providing funding for this all-important Commission,” noted Dr. Donkor, when presenting his committee’s report to Parliament.
To avert the difficulties in accessing funds, Dr. Donkor urged the Petroleum Commission to develop the necessary legislative instrument to enable it generate funds, as a way to weaning itself of government financial support.
Reacting to the above concern raised by Dr. Donkor, the Minister of Energy and Petroleum, Emmanuel Armah Kofi-Buah, promised to liaise with the Minister of Finance to, as a matter of urgency, resolve the problem to enable the Petroleum Commission go about its duties without any hitches. |