body-container-line-1

Ghana’s Risk Losing Huge Oil Cash Through Secret Contracts

By Abubakari Seidu Ajarfor
General News Ghanas Risk Losing Huge Oil Cash Through Secret Contracts
JUN 2, 2016 LISTEN

None of the eighteen [18] oil and gas producing countries in Africa, including Ghana has requirements for the mandatory disclosure of oil and gas contracts, according to Africa Oil Governance Report, May 2015.

The report further indicated that contracts between governments and oil and gas companies are often shrouded in secrecy thereby giving rise to the massive corruption in the upstream petroleum contracting regime.

The Africa Centre for Energy Policy [ACEP], at the launch of this 2015 report indicated that if measures such as the new EITI standards of mandatory disclosure of oil contracts and the EU’S amended Accountability and Transparency Directives, and the Dodd-Frank Act, Africa oil and gas producing countries and particularly Ghana may never maximize the full potentials of its oil benefits.

Linda Ahunu, Policy Analyst, ACEP, noted that citizens without access to contracts information becomes impossible for them to know and understand the contents of the agreements that their governments have made on their behalf left alone to track and monitor success.

According to her, mandatory contract disclosure minimizes public mistrust and wrong perceptions in resources management which goes a long way to prevent any public insecurity and rebellion as in the case of the Niger Delta.

Linda Ahunu, during a presentation of the Africa Oil Governance Report, she indicated that Ghana has already published some of its contracts without any mandatory measures nut with the minister’s own discretion.

She added that nine [9] oil and gas producing countries in Africa have adopted an open and competitive bidding process for the award of petroleum contracts however Ghana, Nigeria and Cameroon have been missing in the chain.

The report also disclosed that none of the 18 oil and gas producing countries in Africa has adopted the Free Prior and Informed Consent [FPIC] which allows for genuine inclusion, disclosure and respect for local citizenry in decision-making processes.

Linda Ahunu emphasized that fiscal measures such as open budgeting have gained some appreciable levels in 12 countries.

However, there is little importance to the right to information legislation which mandates citizens to demand for detail disclosure of information on specific contracts signed.

She recommended that government must best practices to maximize the full benefits of finite oil resource to avert the resource curse in the country.

Benjamin Boakye, Deputy Executive Director of ACEP, said, in spite of the progress in the extraction of oil and gas, Africa lives the irony of the “oil curse.”

He noted that many commitments have been made by some African Governments to change the trend through legislation and international frameworks such as the EITI, Open contracting Partnership [OCP], and Open Government Partnership [OGP] to help rectify the governance challenges but a lot remain undone.

Ian Gary, OXFAM America, who officially launched the Africa Oil Governance Report 2015 said, commended the efforts of ACEP as a “Think and Do tank.”

He concluded by indicating that the report has done a great job in accessing the frameworks and standards oil governance in Africa and largely, it also identifies the right priorities.

body-container-line