Business News of Fri, 12 Jan 20189
ExxonMobil must abide by local content laws – Analyst
Oil industry analysts want authorities to enforce Ghana’s local content policies as new entrants join Ghana’s oil exploration industry.
The comments also follow the commencement of operations of ExxonMobil in Ghana.
The company is expected to sign an agreement with the government on Thursday, January 18, 2018, on the development.
Citi Business News has been speaking to some industry players ahead of the official signing and they believe government must work to avert some mistakes made in previous oil agreements.
The Executive Director of KITE, Ishmael Egyekumhene described as good indication for future investments, the coming on board of Exxon Mobil.
He tells Citi Business News compelling oil companies to comply with the country’s local content policies will help retain enough revenue in the system.
“Anybody signing a petroleum agreement will have to have that at the back of their minds…We have targets as to how many Ghanaians should be employed, we have targets as to where they can source various products. These are all clearly spelt out in our local content policy. So unlike ten years ago, we are in a position where we seem to know what we like and what we expects for us so I expect them to go strictly by our local content policy,” he stated.
For this year (2018) alone, government is seeking to raise 3.2 billion cedis in revenue from the oil sector.
This is slightly higher than the 3.1 billion cedis estimated in 2017.
As at September 2017, Government has accrued 1.45 billion cedis from the oil sector.
For this year, government has also projected crude oil price of 57.36 dollars per barrel.
With production expected to come from the current oilfields which are the Jubilee, TEN and Sankofa Gye Nyame.
Meanwhile Energy Minister, Boakye Agyarko has also indicated that his outfit will subject all oil blocks contract to competitive bidding to give value for money.
“…Implement open and transparent public competitive tender processes in the award of petroleum blocks, it is our target that this year we conduct the first bidding grounds for the award of exploration introduction rights to successful companies.”
Already, the African Centre for Energy Policy (ACEP) has urged that government sanctions all oil companies that fail to comply with the countries laws guiding oil exploration.
“And how that happens, we have to continue to interrogate whether the politicians are behind them and just giving them the extension even though they are not performing, we have to continue to interrogate that to ensure that the country’s interest is rather served than that of the politicians,” the Executive Director of ACEP Benjamin Boakye told Citi Business News.