Open Challenge

As a follow up of our Press Statement on the Petroleum Exploration and Production Bill 2013 released on 28th July, 2014 the Ghana Institute of Governance and Security is challenging the following under-listed organizations and their executives to come out and tell Ghanaians how much revenue would eventually accrue to them from the Jubilee Fields which is considered to hold 2 billion barrels of oil and 5000 billion cubic feet of gas which is equivalent to over 560 billion barrels of oil worth estimated conservative value of US$195 billion (2 billion x US$75) + (560 billion x US$0.08) under the hybrid system-THE MODERN CONCESSION, they are championing and collaborating with the World Bank, IMF, Oxfam America, Revenue Watch Institute, Star Ghana, The British and The Americans to impose down the throat of Ghana.

The World Bank and IMF have estimated theirs to be US$19.390 billion and US$20.269 billion respectively using a long term base price of US$75 per barrel. We have also estimated ours using the same base price of US$75 per barrel to be between US$93.01 billion representing profit oil only (47.70% of total revenue) and US$ 96.875 billion representing Royalties and Profit oil (49.68% of total revenue) as the 'Minimum Government Take' excluding Profit Taxes under the simplest Production Sharing Agreement.

These conservative estimated revenue figures fall within the range 42% - 60% 'Minimum Government Take' set by the US Government Accountability Office (GAO), that should accrue to any host government from total production revenue by allowing its oil and gas resources to be exploited under any fiscal arrangement or contract.

Note:
1. If the Modern Concession formula was not being manipulated by the Foreign Oil Companies Ghana should at least earn US$74.507 billion including taxes, representing 38.21% of total revenue, though this falls short of the base 'Minimum Government Take.'

2. The price of light crude oil has been fluctuating between US$100 and US$120 since 2010 and is currently around US$105 per barrel.

The organizations are:

1. Africa Centre for Energy Policy.

2. Ghana's Oil and Gas Technical Committee.

3. Institute of Economic Affairs

4. Centre for Economic Policy Analysis

5. Oxfam America

6. The 135 CSO Platform on oil and Gas

7. Oil Watch Ghana

8. Ghana National Petroleum Corporation

9. Energy Commission

10. Petroleum Commission

11. IMANI Ghana

12. ISODEC

13. Friends of the Earth

14. Friedrich Ebert Foundation

15. Select Committee on Energy and Petroleum

16. Select Committee on Finance

17. Ministry of Finance

18. Ministry of Energy and Petroleum

We challenge them to publish the list of countries in Africa producing oil in recent times under Modern Concession and they are doing well like Malaysia, Trinidad & Tobago and Belize.

Ghanaians are waiting for your answers.

David Agbee

Executive Director

Solomon Kwawukume

Senior Research Officer,

Oil and Gas