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20.11.2019 Oil and Gas

Upstream: Fronting Local Oil Firms To Face Harsh Sanction In 2020

By News Desk
Upstream: Fronting Local Oil Firms To Face Harsh Sanction In 2020
NOV 20, 2019 OIL AND GAS

The Petroleum Commission (Petrocom) will next year begin enforcement of laws to revoke operating permits of indigenous companies in the upstream petroleum sector caught fronting for foreign firms.

This significant move in collaboration with the Registrar General's Department and the Ghana Revenue Authority is to ensure optimal benefits are derived from the country's local content policy.

Addressing the opening of the 6th Local Content Conference and Exhibition in Takoradi, the Acting CEO of the Upstream petroleum regulator, Egbert Faibille emphasized the era of fronting is about to end.

The enforcement will include tax assessments based on equity participation and profit-sharing, then revocation of operating permits and non-issuance of permits to indigenous companies and their partners if it is proven after a thorough investigation that they have engaged in fronting.

"Let me, therefore, use this opportunity to advise all those engaged in fronting to put a stop to it immediately. Ghana needs an indigenous pool of experienced and highly skilled upstream service companies willing to prioritize, adapt and compete prudently in the industry", Mr Faibille said.

Various stakeholders in the oil and gas upstream sector are participating in the event which is scrutinizing progress made so far in promoting the participation of indigenous companies.

This year’s event taking place in the oil city Takoradi is focusing on maximising in-country value addition and puts the spotlight on the role of Indigenous Ghanaian Companies (IGCs) in Joint Ventures (JVs) in the upstream petroleum sector.

Deputy Energy Minister Mohammed Amin Adam officially opened the Conference and Exhibition.

Over 60 companies are participating in the exhibition.

It is also hosting international delegates from Brazil, Nigeria, Trinidad and Tobago, Uganda and Mozambique to share their experiences and expertise with Ghana.

—JoyNews

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