Public Interest Accountability Committee
GHANA’S UPSTREAM PETROLEUM EXPENDITURE AMOUNTS TO $667 MILLION – PIAC
News Date : 30th November 2020

Total expenditure in relation to upstream petroleum activities on Ghana’s three offshore oil fields – Jubilee, TEN and Sankofa – amounted to $667,529,395.73 for the first half of 2020.

According to the Public Interest and Accountability Committee (PIAC), the amount consists of $349,536,560.47 of production expenses (52.4 per cent of total expenditure) and $ 317,992,835.26 of development costs representing 47.6 per cent of the total expenditure.

“Total cost incurred on the Jubilee and TEN Fields amounted to $514,077,012.02 out of which GNPC’s share was $49,688,235.70. This constitutes both production and capital expenditure. The total cost of the SGN integrated project for H1 2020 was $153,452,383.71. This is made up of operating expenses of $65,135,970.02 (42.4 percent of total expenditure) and capital expenditure of US$88,316,413.69 (57.6 percent of total expenditure),” read an excerpt from the PIAC’s semi-annual report.

“The amount spent on capital expenditure includes $16,876,758.26 incurred mainly on the Offshore Receiving Facility (ORF) and other gas related cost such as interconnection and development studies. Additionally, an amount of $16.17 million was spent on FPSO Bare Boat leasing, development well drilling (logistics) and FPSO development studies,” it read further.

Meanwhile total petroleum receipts into the Petroleum Holding Fund (PHF) from revenue streams including Royalty, Initial (Carried) and Participating Interest (CAPI), Corporate Income Tax (CIT), Additional Oil Entitlement, and Surface Rentals amounted to $322,571,265.64 for the first half of 2020.

This compares unfavourably to some $363,736,223.63 paid into the PHF for the same period in 2019, representing a decline of 11.32 per cent in petroleum receipts.

The breakdown of the petroleum receipts are as follows:

  • CAPI contributed US$129,152,115.15 (40 percent)
  • Royalty yielded US$106,132,203.99 (33 percent)
  • CIT proceeds were US$86,126,413.50 (27 percent)
  • Surface Rentals and Interest earned on the PHF contributed 0.2 per cent and 0.1 per cent of total receipts
  • Other incomes contributed 0.06 of total receipts.

Source : norvanreports.com