Government is committed to judicious use of oil and gas revenue

Accra, Oct. 7, GNA - Government on Thursday reiterated its commitment to ensure the judicious use of the revenue to be generated from Ghana’s fledgling oil and gas sector to the benefit of the citizenry.

However, all stakeholders have to play their part to improve the sector for government to achieve its agenda of accelerated and sustainable economic development and bettering the lot of Ghanaians, Energy Minister Joe Oteng-Adjei said on his turn at the Meet The Press series in Accra on Thursday.

Dr Oteng-Adjei said interest in Ghana’s oil and gas was growing and becoming more competitive, thus placing Ghana in the right stead to negotiate for better fiscal terms and petroleum agreements that preserved national interest.

He said that currently, 13 different petroleum operations were being undertaken along the country’s shorelines at different stages of exploration and development, demonstrating government’s commitment to streamlining and accelerating the process of acquisition of blocks and to speedily increase Ghana’s oil and gas resources.

The Minister revealed that total crude oil production from the Jubilee offshore field between January and September 2011 amounted to 16.7 million barrels, with Ghana earning 337.3 million dollars from its first three lifting’s of 2.98 million barrels.

There have been a total of 24 lifting’s by all the partners in the Jubilee oil field.

Dr Oteng-Adjei said it was government’s intention to maximize the exploitation of gas from the Jubilee Field and other future gas discoveries, disclosing that a limited liability company, the Ghana National Gas Company (GNGC) had been incorporated to own, manage and develop a national network of upstream and midstream gas pipelines and gas treatment and storage facilities.

GNGC, which is a wholly state-owned entity under the Ministry of Energy, would also acquire, construct, establish, manage and maintain upstream and midstream gas transmission and processing facilities, and other systems necessary to gather, transport, treat and store gas.

On downstream developments, the Minister stated that government needed heavy capital to revamp the Tema Oil Refinery, adding, the search for funding was ongoing, with the Ministry of Finance seeking to give the needed support.

He said government had relieved TOR of its debt burden and that a programme had been put in place to ensure technical and financial restricting of the refinery to enhance its economic viability.

Dr Oteng-Adjei noted that since it was only an abundant, reliable and inexpensive energy that would provide the fuel to power the economy, the government was making every effort to ensure that there was sufficient energy to run activities to make the economy grow.

Government, he said, had currently put in place various strategies and programmes to meet the domestic demand that would lead Ghana to become a net exporter of power and fuel by increasing the capacity of the Bulk Oil Storage Company in both storage and transportation of bulk oil nationwide.

On renewable energy, the Minister said government was committed to ensuring the promotion of all forms of renewable energy resource in the country, aiming to achieve at least 10 per cent contribution of modern renewable energy service in the electricity mix by 2020.

He said a Renewable Energy Bill that would provide the regulatory framework and fiscal incentive to attract private sector investment was currently under Parliamentary consideration.

“Currently, the Energy Commission has initiated a programme to support the installation of grid connected solar systems in some public institutions in the country. The Ministry is also supporting the Energy Commission to undertake a more detailed wind resource assessment of the potential sites along the coast for the development of wind parks for power generation.”

Dr Oteng-Adjei said the Ministry was working with the Volta River Authority, the Bui Power Authority and other private developers to undertake further studies towards the development and medium hydro power systems.

He said the VRA was setting the pace to install the first 2 megawatt Solar Park for integration into the national electricity grid by 2015. Additionally, the KNUST, Koforidua and Tamale Polytechnics have been provided with solar training materials and testing equipment for academic research.

He said the Ministry was also collaborating with the World Bank under the Ghana Energy Development and Access Project to provide loans with grant facility through rural banks to supply homes in remote off-grid communities with solar systems.

The Minister said government was also liaising with relevant agencies to address the supply constraints of the Liquefied Petroleum Gas (LPG).

He said two projects being carried out by the Tema Oil Refinery and Fueltrade would give an additional storage capacity of 6000 metric tonnes by March 2012, which would give the country about two weeks strategic stock.

In addition, an eight-inch pipeline would be completed by the end of October 2011 to enhance the pumping rate at TOR.

He said the Ministry had also made some proposals for Cabinet’s consideration on the policy on subsidies on the product, mindful of the clean energy of LPG.