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Oil and Gas targets not met: Citi Budget Watch

  • SOURCE: | qwesa2big
  • Ghana GasThe oil and gas sector is currently among the top five export earners for the country and one of the key sectors that has received some good attention from government, civil society organizations, and donor countries among others.

    Stakeholders in the sector say government’s outlook for the sector was attainable.

    Citi FM’s Vivian Kai Mensah takes a look at whether government’s projections for the sector were met in the Citi Budget Review Series. It turned out that out of the five main projections that were made only one came into being in the sector.

    Projection was for oil production
    According to government, its main focus in the area of oil production was to attain peak oil production of 120,000 barrels of oil per day in the Jubilee for the year 2013. According to the finance minister, Mr. Seth Terkpker, government will intensify the use of innovative interventions and technology to ensure this target is met.

    Unfortunately Target was not met
    Speaking to Citi Business News,the head of IR and Corporate Communications for Tullow, Chris Perry,stated that “production has grown from the jubilee field we are now producing stably 110,000 barrels per day”.

    The Gas Infrastructure Project

    Another project that was to be completed by the end of 2013 was the Gas Infrastructure Project.

    The completion of the 700million dollar gas project which is located at Atuabo in the Western region is expected to rake in massive revenue for the country.

    According to the budget, testing and commissioning of the project was to be done in the third quarter of 2013 while commercial operation will be done in the fourth quarter of the year.

    However, the project has suffered a number of setbacks due to challenges with funding and will not be completed on schedule.

    Chief Executive Officer of the Ghana Gas Company Dr George Sipa Yankey says the project may be completed in the first quarter of next year.

    ‘We have lost some few months, so we are trying to catch up. If we succeed in doing that we will complete the project in the first quarter of next year. If we don’t succeed then it will take longer,’ he said.

    Petroleum terminal
    Another project that was to be commenced is the construction of a petroleum terminal to store petroleum products and LPG at Pumpuni in the Western Region.

    The construction was to be undertaken by the Bulk Oil Storage and Transportation Company (BOST).

    Unfortunately the company in 2013 has been faced with agitations by workers calling for the dismissal of management of the company.

    Union chairman of BOST, Bernard Owusu told Citi Busines News that management of the company failed to undertake its core mandate.

    ‘We think management is not helping us in any direction, and the board is not telling us anything. As we speak, Bolga depot for four years now is not running, Savlegu depot is down, Buipe is running half way and Kumasi no product is there. We are calling on the President to as a matter of urgency remove the board and bring a new board and restructure the management of BOST so that we will stick to our core mandate,” he said

    Passage of key laws
    Another initiative that was expected to have come on board in 2013 is the passage of key laws in the sector.

    One of such laws is the local content law which has been on the table for close to four years.

    Energy think tank, the African Centre for Energy Policy says government is dragging its feet in getting the law passed.

    Director of the Centre Mohammed, Amin Adam told Citi Business News, Ghana is losing millions of cedis due to the delay in its passage.

    According to the budget, as part of measures to promote local content and participation in the petroleum industry, an Enterprise Development Centre (EDC) with support from Jubilee Partners will be fully operational in the year in Takoradi. That centre is currently in operation and is the only project that was undertaken in the sector under the 2013 budget statement.


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