General News of 2013-12-13

GNPC blows $61.8m on office

The lid has been blown of another gargantuan scandal emanating from the ‘backyard’ of the Ghana National Petroleum Corporation (GNPC) after it requested Parliament to approve $61.8million for the purpose of acquiring an office accommodation.

The GNPC is seeking $39.5million in its 2014 budget for the lease of an office in a new building belonging to the Social Security and National Insurance Trust (SSNIT) situated at Airport City in Accra.

The irony of the situation is that the Corporation had, at the same time, indicated in the same 2014 budget that it would be constructing a new head office building in Accra at the cost of $22.3million, even though it has a huge office serving as its headquarters in Tema.

Incredibly, the amount set aside for the lease is even more than the money proposed for building a new office complex, raising questions about the propriety of the proposals.

It took the vigilance of the Minority New Patriotic Party (NPP) members on the Parliamentary Select Committee on Mines and Energy to uncover the plot and DAILY GUIDE’s understanding is that, the Minority NPP members would put their lives on the line to resist any attempt by the Majority to ‘okay’ the deal when the estimates for the GNPC are laid before Parliament today for approval.

According to information available to DAILY GUIDE, the GNPC initially indicated in its 2014 budget that it had earmarked $7.7million to rent an office in the SSNIT Emporium at Airport City in Accra.

The amount is made up of annual lease rental of $3.2million for a 10-year period, $1.5million for furnishing, $2million for computerisation of the office and $1million for consultancy services.

Eyebrows were raised and further scrutiny of the budget by some Minority members proved that apart from the $7.7million for the office rent, the GNPC was planning to construct a new head office next year in Accra for which reason it had also asked Parliament to approve the amount of $22.3million for that venture.

Smelling some fishy deal, some members on the Mines and Energy Committee asked officials of GNPC, who had come before the Committee to justify all the demands they were making, to provide further details with regard to the office lease.

When details of the lease agreement between SSNIT and GNPC were provided, it shockingly came to light that the actual amount payable for the period of the 10 years was $35million and that money would have to be fully paid before the execution of the agreement, meaning that the true figures were not given to the MPs.

This revelation made some members of the committee more suspicious of the deal and, therefore, made a request for ‘better and further’ particulars as to the total expenses that would be made on the lease.

The further particulars truly indicated that the $35million quoted excluded furnishing, consultancy and computerization, which when added, would balloon the amount to $39.5million.

According to DAILY GUIDE’s information, the Minority members on the committee were shocked at the revelation and, therefore, asked that a new budget be prepared without the amount to be used for the office lease because that would be an exercise just to waste the taxpayers’ money.

That, according to sources, was not done and that the committee, chaired by Dr Kwabena Donkor, a former Deputy Minister of Energy in the Mills administration and the National Democratic Congress (NDC) Member of Parliament for Pru East, was still pushing for the estimates to be approved by Parliament today.

Even though the committee’s report on the budget estimates was silent on the lease amount of $39.5million, the Minority members said they would fiercely resist it when it is presented to House today for approval.

On the whole, a colossal amount of $334.1million, which is half of Liberia’s budget, has been allocated for the services of the GNPC during the 2014 fiscal year and according to the Ministry of Finance, part of that amount would be provided from the projected revenue of the Corporation from the Jubilee Oil Fields which is $192.6 million.

According to the Mines and Energy Committee’s report on GNPC’s budget estimates, $118,859,781 has been budgeted to meet Jubilee Equity Financing Cost, the TEN and Offshore Cape Three Points (Sankofa-Gye Nyame) development costs, while $156,345,887 has been set aside to meet petroleum costs such as the South Deepwater Tano, the Voltaian Basin and the Ultra Deep Water Keta projects and the remaining $23,346,758 set aside to cover general expenditure of the Corporation which include administrative, capital, personnel emoluments and other incidental costs.