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BOMBSHELL !!
How stupid, do politicians (NDC & NPP) and technocrats in GHANA, thinks we the ordinary, downtrodden, marginalized and disenfranchised Ghanaian citizens are?! 👇🏽👇🏽👇🏽👇🏽👇🏽
NDC was in power, 2012-2016, after Prof Mills passed on in July 2012 and Mahama took over from him.
By 2014, there had been frantic efforts to pass a Petroleum Exploration & Production Bill into law. Foreign interests, represented by British, the USA and other Western interests, were interested in a law that would maximise the interests of Tullow Plc, a British, Multinational Oil firm, operating in our largest oil field, Jubilee, and Kosmos and Anadarko which are US firms, while marginalising sovereign Ghana, the resource-owning country’s share of revenue. The Bill, as at 2014, was named a Ghana Hybrid System, which fiscal regime, would give us a peanut 18%, while the foreign partners will laugh to their banks with 82%. The Ghana Hybrid System provided Ghana with Royalty, Participating Interest and Taxes, based on Ghana’s corporate tax.
A Workshop was held in Takoradi to sensitize some stakeholders who were invited from across the country. *The CEO for Centre for Natural Resources & Environmental Management, CNREM, Mr Solomon Kwawukume, an experienced oil and gas expert, who had researched into Ghana’s oil and gas upstream sector since 2008, attended the Workshop. Notable CSOs like African Centre for Energy Policy, ACEP, which, together with 130 other CSOs, were co-founded by the World Bank and Oxfam, attended the Workshop. After a bogus presentation that sought to paint a rosy picture of the Ghana Hybrid System, Mr Kwawukume mounted the dais. He shredded the first presentation, followed by a rapturous applause from the audience present, including some invited guests who had complained bitterly that they had not set their eyes on the draft Bill that was about to be passed in 2014.
Due to the bombshell unleashed by Mr Kwawukume, some attendees, including some white expatriates from the US, UK and Australia were shocked and enquired if government had been sensitized on the grave matter of the danger that the Bill posed to our country.
The Bill was therefore shelved until 2016, when it was passed under a certificate of urgency at midnight of 4th August 2016, under dubious circumstances. The foreign upstream oil partners, Tullow Oil Plc and others, allegedly, marshalled USD660 million that they used to, allegedly, bribe our MPs from both sides of the House. As backbenchers, each, allegedly, received USD500,000, while other high officers of Parliament, each, took far more than what backbenchers received. The Bill was then passed into Act 919, Petroleum Exploration & Production Law, 2016. It was alleged that notorious ACEP was the conduit pipe or intermediary for the disbursement of the amount in US Dollars. Tullow Oil and the other partners, described the amount as part of their corporate social responsibility. When *challenged to show which projects were financed with the huge amount, only USD 200 million could be accounted for.
Prior to the passage of the Bill, the US Ambassador to Ghana at the time, was exerting much pressure on the Chairman of the Mines & Energy Committee in Parliament, Alhaji Sorogho, through phone calls. Mr Kwawukume attests that he was with Alhaji Sorogho, MP for Madina, in his Constituency, when a call came through from the US Ambassador, frantically enquiring when the Bill would be passed into law
With Law 919 passed in 2016, Ghana ceded its sovereignty over her God-given natural resource, the black gold, that other countries like Nigeria, Angola, Eritrea, Libya, Mauritania, Cote D’Ivoire, UAE, Oman, Saudi Arabia etc are taking 44-85% revenue because they are implementing a fiscal regime called Production Sharing Agreement, PSA. With PSA, unlike Ghana’s Hybrid System, the resource-owning country makes zero investment, but is allowed to take her portion of oil at the point of pumping, ready for sale in the international market. There are empirical evidences to show that Ghana has been short-changed since she commenced pumping oil in December 2010. *Recently, Tullow which spent money to have a fortuitous law passed in its favour, entered into PSA agreement with our neighbour, Cote D’Ivoire to drill oil in that country. So, why would Tullow operate under a UN and universally accepted fiscal regime, PSA, that gives Cote D’Ivoire, lion’s share of oil revenue, while operating under Ghana Hybrid System that gives them 82% revenue ?
The answer is as good as your guess: Our negotiating-technocrats and politicians have been stupid, greedy and foolish. They have sold us to foreign oil interests, just as our gold was sold and we continue to take barely three percent, 3%, revenue from time immemorial.
Solution
Parliament, must amend or abolish Act 919 and replace it with a new Law,
based on PSA*. Long before Act 919, we had PNDC Law 84 that was based on PSA fiscal regime. But, by late October, 2001, the Commonwealth Secretariat that still had Imperial ambitions, but pretended to love Ghana, recommended a petroleum fiscal regime that would supplant PNDC Law 84, to President Kufuor. *Sabre Oil that was, alleged, to belong to former President Kufuor, was sold to Petro SA. So, when oil was discovered in 2007, the ground work had already been laid to enable neo-colonialist interests that our first President, Dr Nkrumah, so eloquently spoke about, to feed on our upstream oil, like vultures, reaping where foreign interests hadn’t sown any seed. The coup de grace was delivered with the passage of the Petroleum Exploration & Production Law 919 in 2016. Time to right the grievous wrong
Alternatively, the next government must take the bull by the horns, in order to have enormous revenue to salvage our economy, beginning 2025, by reversing the status quo Law 919, that was passed in 2016, otherwise posterity will not judge us fairly. If we have 44-85% revenue, under PSA, each time oil is pumped from all our oil fields of Jubilee, Sankofa and TEN, with revenues running into billions every 5 years, the amount of development will be gigantic to move our nation forward, in leaps and bounds, instead of remaining tied up to the aprong strings of international capital markets to borrow, endlessly and end up being bankrupt, nationally.
Author
By Johnson Fiebor, Snr. Lecturer in Accounting (Rtd.),
Ho Technical University.
#dryawtwimasi Wednesday, July 19, 2023!