Stop financing infrastructure projects - PIAC tells GNPC

The Public Interest and Accountability Committee (PIAC) says the Ghana National Petroleum Company (GNPC) should desist from financing infrastructure projects with funds allocated to it from petroleum revenues.

The Committee proposed that any outstanding payment (s) to be made in respect of the Western Corridor Road project must be paid from the allocations to the Roads and other Infrastructure priority areas.

PIAC made this known in its report on the management of petroleum revenue for the first half of 2016.

Total allocation of petroleum revenue to GNPC was $22.77 million while $64.04 million was spent, representing a net deficit of $41.27 million (181.9%).

An amount of $3.12 million was expended on the Western Corridor Roads while $0.32 million was spent as GNPC’s contribution to the decommissioning of the Saltpond Field.

Crude Oil Declines

The Committee reported that crude oil production from the Jubilee Field declined by 40 percent from 19.08 million barrels in mid-year 2015 to 11.44 million barrels over the same period in 2016.

It attributed the decline in production to a combination of scheduled shutdown of the FPSO for routine maintenance and a faulty turret bearing which led to the suspension of oil production for up to 50 days.

“The 2016 half-year production volumes are the lowest since 2011. There was a 38 percent decline in the production of raw gas from 27,363 MMscf in the first half of 2015 to 16,904 MMscf during the period under review,” the report said.

The Committee said there was no production at the Saltpond Field following the suspension of operations in December 2015, adding that the Saltpond Field is currently being decommissioned.

It said the Ghana Group lifted 1.95 million barrels of oil, representing 18.48 percent of total liftings from the Jubilee Field between January and June 2016.

“Liftings carried out by the Ghana Group declined by 39 percent when compared to the liftings done during the same period in 2015.

“A total of 9,349 MMscf of wet gas was exported to the Atuabo Gas Plant for processing into lean gas, LPG and condensates.

“Average achieved price for the Jubilee Crude was $40.21 per barrel compared to benchmark price of $53.03, representing a negative variance of 24.21 percent,” the Committee said.