'Don't Raise Expectations Of Ghanaians On Oil Find'

A member of the World Bank Extractive Industries Advisory Committee, Dr Steve Manteaw, has urged politicians not to raise the expectations of Ghanaians that the oil find will be the magic wand that will address Ghana’s employment problems.

“High local expectation of job creation is unlikely to be met. Much activity will be done offshore,” he said, adding that that would pose a great danger when production was in full gear.

Dr Manteaw, who is also the Co-ordinator of ISODEC, was speaking on, “Oil Challenges to Ghana’s Democratic Development”, during a three-day workshop organised by the Institute of Economic Affairs (IEA) for political parties and Members of Parliament (MPs).

“Tullow estimates only 200 direct employees and 800 others working for contractors,” he said. He explained that the oil facility would not yield much employment as expected because initially there would not be much value addition for the oil onshore because the government’s focus was on downstream gas production.

He said it was gas production that might yield some appreciable number of employment opportunities. Dr Manteaw disclosed that the Jubilee Oil Field was 63 kilometres from the coast and 132 kilometres southeast of Takoradi and called for increased information and consultation to address the concerns and expectations of coastal and fishing communities.

On the effectiveness of government revenue mobilisation machinery, he quoted a 2008 World Bank report which indicated that there was weakness in government revenue collection, especially in the mining sector.

He also quoted an Extractive Industry Transparency Initiative (EITI) audit report which indicated that an official of the Customs, Excise and Preventive Service (CEPS), who was the government’s eye to critically monitor the volumes of gold produced by a mining company for tax purposes, had been at one mining company for more than 10 years.

According to Dr Manteaw, at the time of the audit, it was again realised that the CEPS official was not even at post, a situation which allowed the mining company to state at will how much gold it had produced for that day.

He said the country should be guided by the bitter experiences from the gold sector over the last 100 years and what pertained in other oil producing countries to benefit from the oil find.

He said currently Nigeria did not know the exact quantity of oil it was producing because of metering challenges it faced and wondered whether with Ghana’s oil find, which was about 63 kilometres from the shore, it would be able to critically monitor to ensure that every drop of oil was accounted for.

Dr Manteaw raised concern over the lack of capacity and readiness on the part of the Environmental Protection Agency (EPA) to critically monitor the oil industry to nip in the bud any disaster to the nation’s environment.

He expressed worry that personnel of the EPA were not made to benefit from the Ghana-Norway Oil for Development Agreement which had been available to only personnel of the Ghana National Petroleum Corporation (GNPC).

He said the challenges posed by Ghana’s oil boom were broad, deep and complex and should not be underestimated because oil could undermine the gains made in democratic governance and development if not properly managed.

“Ghana must control the pace of petroleum sector development so that it does not outstrip the capacity of the government and society to build institutions, regulations and standards,” he added.