Set Up Oil Fund To Serve As Post-Oil Revenue
The Group Biodiversity Advisor to Shell International, Mr Sachin Kapila, has suggested that Ghana considers establishing a fund with part of its oil revenues to cater for the period after the resource is exhausted.
He said the country should seriously consider its post-oil find era and soberly reflect on a situation where the oil and gas resource would be extinct and, therefore, set funds aside to sustain its development agenda.
Mr Kapila, who spoke to the Daily Graphic on the sidelines of the Katoomba Group meeting in Accra, said the country could take some cues from Norway, whose post-oil fund had yielded about $700 billion.
The Katoomba Group is an international network of experts working to promote and improve capacity related to markets and payments for ecosystem services (PES).
Its three-fold mission is to identify and respond to gaps in PES theory and practice, share knowledge about new developments related to PES markets, and address key challenges such as mobilisation of private sector buyers and facilitate progress on legal, policy and institutional frameworks.
The October 6-7 meeting is the first in West Africa and the fourth in Africa after South Africa, Uganda and Tanzania have hosted it.
The West Africa meeting is important because the continuing erosion of its forests is putting pressure on the wide biodiversity of the region considered by Conservation International as the world’s 34th biodiversity hotspot.
Asked how Ghana can mitigate the negative impact of the oil and gas industry, Mr Kapila said although the resource would be produced offshore, gas processing required onshore operations which the country should prepare to handle properly.
“The country should pay attention to marine issues, shipping issues, aquatic life and migration,” he said, adding that authorities should have in place policies and regulations to guide all processes on building infrastructure for processing and storage,”
In climate change discussions, attention has been placed on forests. However, there is an increasing impetus to discuss soil carbon as part of Beyond REDD initiatives, starting from December this year.
On soil carbon and other terrestrial carbon options, the Shell biodiversity advisor said Ghana could take advantage of its cocoa growing areas to generate additional income through forest carbon credits and so on.
Although cocoa cultivation is seen as a contributor to deforestation, the country should take advantage of carbon finance to make the soils from the cocoa farms useful and an alternative income generator.
Ghana is among three countries in West Africa which have received the World Bank’s Forest Carbon Partnership Facility to enable her submit readiness preparation plans for Reduced Emissions from Deforestation and forest Degradation (REDD).
There are also other emerging private sector initiatives to develop ‘forest carbon’ credits and a biodiversity offset programme in Ghana.
According to biodiversity experts, soil carbon has several useful purposes, which would be discussed in detail at the upcoming climate change conference in the capital of Switzerland, Copenhagen, where a new treaty on climate change is expected to be reached.
Mr Kapila said Shell, as part of its concept of ensuring a sustainable business, had invested heavily in environmental services and was also taking a number of steps to reduce carbon emissions.
This includes energy efficient processes, behavioural changes and also maintains the cost of carbon on its balance sheet, so it will work more effectively.
“At Shell, we believe that environmental due diligence is important for sustainable business,” the biodiversity advisor told the Daily Graphic.
He said Shell was among the companies that started putting premium on the effects of their operations and, therefore, was investing in various activities downstream in compliance with international treaties.
REDD is building capacity in 37 countries, a good start at confronting the global issue of climate change. Mr Kabila said that that was a good start to building capacity across the world, adding that there was also a need for a political will for countries to change their development paths and resort to environmentally friendly development paradigms.