Concerns are being voiced about how Ghana will manage its oil revenues as the Jubilee field, its first major offshore deposit, prepares to start producing and exporting in the fourth quarter of this year.
Bright Simons, director of development research at IMANI, an Accra-based public policy thinktank, said in an interview: We are as concerned with financial prudence, and the management of the proceeds from the resource, as we are about transparency.
London-based Tullow Oil, the operator at Jubilee, expects initial output to be 120,000 barrels a day. With reserves of 800 million barrels of high-quality oil and potential for at least 1 billion more, the Jubilee field could make Ghana the fifth largest oil nation in sub-Saharan Africa after Nigeria, Angola, Sudan and Gabon.
The government is confident that crude exports will boost annual GDP growth to as much as 10% in the next few years. And the IMF predicts that if Ghana uses the windfall wisely, it could reach the status of a middle-income country within a decade.
But critics say that the regulatory framework is being put in place too slowly, and that the process is too opaque. Economists and campaign groups alike warn that if the governments expressions of good intention are not turned into action, the country could be vulnerable to the resource curse.
The government says it will comply with the Extractive Industries Transparency Initiative (EITI), that oil revenues will be monitored via an account at the central bank. It intends to set up a heritage fund to capture surplus revenues, which should be managed by investment advisors. The finance ministry said earlier this year that both accounts will have clear deposit and withdrawal rules.
The government also plans to put regulatory responsibility for upstream activities in the hands of a National Petroleum Authority, and turn the Ghana National Petroleum Corporation (GNPC) into a strictly commercial entity.
But Ben Amunwa of Platform, the London-based NGO that monitors the international oil industry, said that the government is moving too slowly. They have a great deal of work to do, given that the first oil will begin to flow from December this year.
The revenue management bill has not yet been published and that is an absolute necessity. Any policy that is going to have a democratic basis needs to be debated properly.
On managing funds accruing from the windfall, Simons at IMANI urged the government to take more steps to prove its commitment to accountability. The management of pension funds by parastatals has cast serious doubts on state-led efforts towards financial prudence, he argues.