Crude oil declined by 6.3 percent – PIAC

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File photo taken on March 12, 2019 shows operating oil pumps in Luling of Texas, the United States. U.S. oil prices turned negative on April 20, 2020. West Texas Intermediate crude for May delivery shed more than 300 percent to settle at -37.63 U.S. dollars per barrel on the New York Mercantile Exchange. (Xinhua/Wang Ying)
(Xinhua/Wang Ying)

The production of crude oil fell by 6.3 per cent in 2020 from the 2019 volume, the first such drop in over three consecutive oil production increases, the 2020 Annual Management Report of the Public Interest and Accountability Committee (PIAC) has shown.

The report indicated that total gas production increased by 40 per cent, while the Sankofa Gye Nyame (SGN) field increased its output by 60 per cent being the highest volume in both Associated and Non-Associated Gas.

The 2020 PIAC Annual Report encompasses a high range of issues associated with management and utilization of petroleum revenues, including crude production, revenue accrued, revenue received, liftings, allocation and utilization of revenue by government and management set aside in the Ghana Petroleum Funds (Ghana Stabilisation Fund (GSF) and Ghana Heritage Fund (GHF).

The report is a result of a continuous collaboration of PIAC and its stakeholders. It also contains other issues and finding pertinent to the performance of various institutions.

The report said the COVID-19 pandemic contributed to a general revenue decline, following a fall in crude oil prices at the local and the international market.

The report said Surface Rental payments remained in arrears of US$2.1 million in 2020 an increase over the 2019 arrears of US$1,566.463.12. Nonpayment of income denies the PHF the necessary funds for development projects.

According to the report, the Petroleum Revenue Management Act (PRMA) could not present the 2020 – 2022 priority areas selected for Annual Budget Funding Amount (ABFA) disbursement to Parliament for approval.

The recommendation for the Annual Budget Funding Amount (ABFA) should not be used to serve the purpose of filling expenditure gaps when there is a revenue shortfall in the Budget.

PIAC, therefore, recommended that the Ghana Revenue Authority should initiate action to recover surface Rental Arrears.

It also called on the Ministry of Finance to ensure that Priority Arrears are approved by Parliament before implementation as required by Section 21 (5) of the PRMA.

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