PIAC Commends Finance Minister -For Ordering GNPC To Correct Oil Under Pricing Anomaly

By Adu Koranteng

The Public Interest and Accountability committee has commended Minister of Finance, Ken Ofori Atta for taking steps to order the Ghana National Petroleum Corporation to take immediate steps to address anomalies in the pricing of crude oil to save the country from further revenue losses.

A statement signed by the president of PIAC, Dr Steve Manteaw said “PIAC wishes to commend the Minister of Finance for directing GNPC to take immediate steps to address the anomaly in the pricing of the crude oil to save the country from further revenue losses. The directive, said to be contained in a memo of July 2018 responds adequately to Recommendation 10 of PIAC’s 2017 Annual Report (pg. 59). 6. The PIAC report established that, in 2017, Ghana lifted four parcels of crude oil from the TEN Field. These were in March, June, October, and December. In all the four cases, the sales returns reported substantial price deviations from the Government’s bench mark price, Jubilee, and BRENT achieved prices. The March lifting from TEN for instance, had a negative price differential of almost US$5/bbl against Jubilee, and slightly over $2/bbl against BRENT”.

“In October, the performance of the TEN crude was worse. It suffered a negative price differential of US$6/bbl against both Jubilee and BRENT.  It is important to recognize that even a dollar price differential for a barrel of crude can amount to substantial losses. This is because a parcel of crude from our oil fields is usually around a million barrels. A dollar mark-down done fraudulently can therefore lead to a loss of a million dollars per lifting”.

“PIAC in its 2017 Annual Report therefore recommended that GNPC took another look at its pricing and marketing policy for TEN crude, to eliminate the significant price difference with Jubilee crude. Public Interest and Accountability Committee (PIAC) . Given that, GNPC appears to contest this view, as evident in the Corporation’s response to the Minister’s directive, PIAC strongly recommends the establishment of an independent panel of experts with key representation from GNPC, MoF, BoG, PC, GRA, and PIAC, to review the TEN crude oil marketing policy, and to settle the matter.”

“We take this opportunity to assure the general Ghanaian public that PIAC will not relent in its efforts at ensuring the most prudent, and efficient management and use of Ghana’s petroleum revenues, and will continue to count on the goodwill and co-operation of all stakeholders in this endeavor. The statement added.