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Feb 20, 2019 | Business & Finance

ACEP Raises Red Flags Over GNPC's Plan To Spend $43m On CSR

By Modern Ghana
Executive Director of ACEP, Benjamin Boakye
Executive Director of ACEP, Benjamin Boakye

Africa Centre for Energy Policy (ACEP) has raised concerns about plans by the Ghana National Petroleum Corporation (GNPC) to spend far less on Corporate Social Responsibility (CSR) than on its core mandate in 2019.

In a detailed report that analysed the GNPC’s work programme for the 2019 financial year, which is currently awaiting parliamentary approval, the energy think thank revealed that GNPC plans to spend $43.05 million on CSR but only $20.3 million on its operations in the Voltaian Basin and its subsidiaries in the sector.

“This is less than 50% of what GNPC wants to spend on CSR. In recent times, the Corporation has become more popular in delivering development projects rather than its core mandate.

“While GNPC, like any corporate entity, has a responsibility towards society, it is unusual for sound corporate organisations to spend more than 10% of its cash flow (not profit) on corporate social responsibility,” ACEP states in the report.

Click this link to access the full report.

The commenting further on GNPC’s planned expenditure on CSR, the ACEP report notes that the state oil corporation’s expenditure becomes more profound when its CSR budget is compared with the budget of some critical ministries.

For instance, ACEP states that the CSR budget of GNPC in 2019 represents 2819%, 270%, 240%, 629% of the capital budget of the Ministries of Justice and Attorney General, Energy, Agriculture and Finance respectively.

“In relation to the total budget of the mentioned ministries, GNPC’s CSR budget represents 210%, 254%, 47%, and 65% respectively,” the report said.

The energy think tank is urging Parliament not to approve any CSR budget for GNPC until the end of the fifteen-year financing window provided in the Petroleum Revenue Management Act (PRMA) has elapsed.

“This should free up funds for the Corporation to deliver on its core mandate as an upstream oil player,” ACEP said.

GNPC is Ghana’s national oil company established in 1983 to support the government's objective of providing an adequate and reliable supply of petroleum products and reducing the country's dependence on crude oil imports, through the development of the country’s own petroleum resources.

GNPC is a partner in all petroleum agreements in Ghana and the national gas sector aggregator in Ghana.

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Read the full report here.

In the video below, ACEP’s Executive Director, Benjamin Boakye and the Technical Advisor to the Civil Society Platform on Oil and Gas, Kwame Jantuah, give further analysis of GNPC’s operations on PM Express .

Source: Ghana | Myjoyonline.com

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