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NPA directs OMCs to begin charging reduced prices for petroleum products today

The National Petroleum Authority (NPA) has directed Oil Marketing Companies (OMCs) to implement the amended Special Petroleum Tax (SPT) Act which reduces the tax by 2%.

The amendment also converted the SPT from a 15% ad valorem to a 13% specific tax, which means a specific amount will now be charged for a litre of petroleum product.

Per the new pricing regime, the SPT on petroleum products effective from Friday, February 16, 2018, will be as stated below.

New-SPT

Parliament on Thursday passed the bill following agitations by Labour and the Chamber of Petroleum Consumers (COPEC) against rising fuel prices.

COPEC says the reduction is welcome news but it had hoped for a total scrapping of the controversial tax.

The SPT was introduced in 2014 in reaction to the falling price of crude oil on the international market, but it still remains in the books despite a stable price for the commodity.

Jubilee FPSO shutdown won’t affect power supply – VRA

The Volta River Authority (VRA) says Thursday’s shutdown of the Jubilee FPSO for routine maintenance will not affect the supply of power from the Aboadze enclave.

The VRA has said in a statement dated January 1, 2018, that it has “put in place contingency plans to avert the supply deficit that would have occurred at the western power enclave, during the period.”

The first of three planned shutdowns of the FPSO Kwame Nkrumah on the Jubilee field began on Thursday, January 1, 2018.

The planned shutdowns are expected to make way for operators on the oil field to embark on a general maintenance exercise on the vessel.

According to partners of the Jubilee field, the three shutdowns in 2018 have become necessary due to the recent challenges faced by the Floating Production and Storage Offloading vessel.

There have been concerns that the shutdown will disrupt electricity supply, however, the statement from VRA states that it will put up to two turbines on Light Crude Oil (LCO) in combined cycle mode to generate up to 300 MW from Aboadze to support the system.

“In addition, VRA will receive on demand, up to 200MW of power from La Cote d’Ivoire to complement generation,” the release issued by the VRA management said.

 

Source: myjoyonline

Govt to build new oil refinery for $4 bn

Government has announced an ambitious plan to build a new oil refinery to replace the Tema Oil Refinery (TOR) within the next three to four years.

Energy Minister, Boakye Agyarko, who disclosed this says the new facility should increase the supply of refined products in Ghana.

This is also part of attaining the energy hub status that the government is aiming at in the short to medium term.

The announcement comes days after the Institute of Energy Security (IES) warned of some impact on fuel supply should government fail to resolve the operational challenges at TOR.

Currently, TOR is able to refine crude up to 20,000 barrels of oil per day.

But Boakye Agyarko has told Citi Business News this should increase by about seven times to 150,000 barrels of oil with the new refinery.

The new facility is also estimated at 4 billion dollars.

He spoke on the sidelines of the Downstream Petroleum Colloquium by the National Petroleum Authority (NPA).

“We want to make sure that in the next three to four years, we build a brand new TOR of about 150,000 barrels of oil per day throughput, and then gradually ease out the old TOR which becomes a tank farm for the new TOR. Because the new TOR currently is at 20,000 barrels of oil per day which is not satisfactory, and if you ramp it up, the most you could get out of the old engine is 80,000 barrels of oil per day,” he stated.

The IES’ concerns among others had to do with leadership challenges at the refinery, which it argues has contributed to the inability to sustain operations.

The Energy Minister further disclosed plans to review the current laws governing the downstream sector.

The move will among others dwell on strategic stock management, increased access to petroleum products as well as improved quality of petroleum products.

Mr. Agyarko further revealed that, an implementation committee has begun the necessary research work to guide the formulation of such laws and achieve the energy hub target in the interim.

“We have already put in place an implementation committee which is looking at all the facets and regulations required which is why I have emphasized the need to look at the law again,” he added.

The colloquium on the theme, “Then, Now and the Future”, is to create a platform for the sector Ministry, Authority and its stakeholders for dialogue and information dissemination of industry activities, policy directions of the sector Ministry, trends and opportunities.

This is also to ensure the continuous growth and development of the petroleum downstream.

By: Pius Amihere Eduku/citibusinessnews.com/Ghana

Ghana Petroleum Fund yields $7.03 million in 2017 – Report

The total net profit on the Ghana Petroleum Fund for January to September 2017 was US$7.03 million, according to a report by the Ministry of Finance on the Petroleum Funds for the 2017 fiscal year.

Out of the total amount, the Ghana Heritage Fund contributed $5.20 million, compared to US$ 4.04 million in 2016, while the Ghana Stabilization Fund contributed US$1.83 million, compared to $ 0.65 million in 2016.

The report said in the first half of 2017, the nominal US Treasury yields eased from the highs recorded after the US election, as the bill to repeal and replace the Affordable Care Act was unsuccessful in the face of political gridlock.

The report said the yield of the US 10-year Treasury note ended the first half of 2017 at 2.304 percent, compared to 2.444 percent at the end of the second half of 2016, while the yield of the two year note ended the first half of 2017 at 1.382 percent, compared to 1.188 percent at the end of the first half of 2016.

On the outlook for 2017, the report said the global economy was expected to grow at a pace of 3.4 per cent in 2017, up from 3.1 per cent in 2016.

It said growth forecast for the United Kingdom had been lowered from 2.0 percent to 1.7 percent for 2017, due to tepid performance of the UK economy and lack of clarity on the ultimate economic impact of Brexit.

Touching on developments in the upstream petroleum sector in 2017, Mr Emil Addae, Production Engineer at Ghana National Petroleum Corporation, said crude oil prices have remained relatively stable, while the output is increasing as a result of production from the new fields in 2017.

Mr Addae said the total petroleum receipts that are proceeds from liftings and other petroleum receipts as at September 2017 was $362.58 million dollars, which compared with the receipts of $172.92 million for the period in 2016.

He said the total amount transferred between January to September 2017 from petroleum liftings and related proceeds to the Annual Budget Funding Amount (ABFA) was $127.09 million.

Mr Addae said out of the total ABFA amount transferred, $6.92 million was allocated to the Ghana Infrastructure Investment Fund in the first quarter of 2017.

On the way forward, Mr Michael Asare-Akonnor, an Economic Officer at the Ministry of Finance, said the final determination of the Ghana-Cote d’Ivoire maritime boundary dispute by International Tribunal for Law of the Sea on 23rd September 2017, expected that all the previously affected companies would resume normal operations to implement their work programmes under their respective petroleum agreement.

He said work was on-going for the drafting of the petroleum regulations to provide operational details for the Exploration and Production Act and explain how the Act is administered.

Mr Asare-Akonnor said the draft Petroleum Revenue Management Act Regulations was almost ready and would be laid in Parliament before the end of 2018.

 

Source: myjoyonline

Consumers to enjoy stable fuel prices from December 1

Fuel consumers will from Friday December 1, 2017 be insulated from paying high cost of the commodity at the pump.

This is because government has decided to stabilize prices of petroleum products under its price stabilization mechanism captured in the Energy Sector Levies Act 2015.

As a result, all OMCs and LPGMCs have been notified by the Petroleum Regulators, NPA, to review the prices of the products in line with the revised Price Stabilization and Recovery Levy (PSRL).

A November 30 letter written by the NPA to all OMCs, a copy of which has been intercepted by Myjoyonline.com said: “All OMCs/LPGMCs are to note the above review of the PSRL and apply it in their price build up effective 1st December 2017.”

Per that revision, a litre of diesel which currently sells 10 GHp will now be selling at 3 GHp. The price of LPG will also be revised by that same margin. Petrol which is selling at a litre price12 GHp will remain unchanged.

Hassan Tampuli

Background

One of the main determinants of fuel prices on the international market is the crude oil price on the international market.

Due to the fluctuation in prices of the commodity on the international market, consumers in Ghana suffer many price hikes even when the local currency is relatively stable.

Consumers in Ghana have recently been enduring price hikes in petroleum products on account of increases in crude oil prices on the international market.

In an attempt to stabilize the prices, the Energy Ministry directed the NPA to activate the Price Stability and Recovery Levy (PSRL) under the Energy Sector Levies Act 899 which is to provide stability for consumers at the pump in times of rising prices of petroleum products on the international market.

 

Source: myjoyonline

Gov’t urged to be transparent in tracking oil-funded projects

The government has been urged to be open and transparent with its decision to track projects funded with petroleum revenues across the country.

Dr Steve Manteaw, Member of the country’s Public Interest and Accountability Committee (PIAC) said in an interview with Joy News after a GIZ-funded workshop organised by the Institute of Financial and Economic Journalists (IFEJ) and PIAC.

According to him, transparency will bring about integrity in the monitoring of oil-funded projects.

He said, Government should just be open and transparent with its findings from the inspection and they should be aware that PIAC and its partners are also tracking and reporting the use of oil revenues.

“The fact that the ministry itself will be undertaking an exercise of this nature gives us an opportunity to juxtapose what the government tells us with what an independent body like PIAC will be putting up, so we have some assurance that there is some integrity in the tracking exercise,” he said

Ghana discovered oil in commercial quantities in July 2007 and commenced production in December 2010.

Steve Manteaw

Dr Steve Manteaw

Section 48 of the country’s Petroleum Revenue Management Act (PRMA), Act 815, 2011 states:

(1) The minister shall submit an annual report on the Petroleum Funds as part of the annual presentation of the budget statement and economic policies to Parliament.

(2) The annual report shall be prepared in a manner that makes it easy for the dissemination to the public and shall include the following information for the financial year for which the report is prepared:

(a) audited financial statements of the previous year comprising­;  (i) the receipts and transfers to and from the Petroleum Holding Fund,

(ii) the deposits into and withdrawals from the Ghana Stabilization Fund and the Ghana Heritage Fund, and

(iii) a balance sheet including a note listing the qualifying instruments of the Ghana Petroleum Funds;

(b) a report from the Minister describing the stage of implementation of the programmed activities funded by and the expenditures incurred on the activities covered by the Annual Budget Funding Amount in the financial year of the report.”

The various finance ministers, notwithstanding the legislation, have failed to comply, hence Dr Manteaw, who is also a Co-Chair of the Ghana Extractive Industry Transparency Initiative (GHEITI), lauded government for the decision to begin monitoring projects funded with petroleum revenue apart from what PIAC has been undertaking over the years.

“It is rather unfortunate that over a period of six years, the ministers of finance have been unable to comply with the provision to provide an update on oil-funded projects so this exercise, I believe, it will enable the minister to be compliant with the requirements,” he observed.

There have been concerns by some section of the Ghanaian public that the government wants to usurp the role of the Public Interest and Accountability Committee, the civil society body mandated by law with oversight responsibility of monitoring and evaluating the management of Ghana’s petroleum revenue by the government and its relevant state institutions.

But Dr Manteaw, who is also an analyst with the Integrated Social Development Centre (ISODEC) and member of the National Steering Committee of the Open Governance Partnership Initiative disagrees and urged PIAC to be focused on its core mandate.

“PIAC doesn’t have to be worried at all. PIAC should just keep focus and innovate in terms of getting citizens involved in how we track oil revenues,” he said.

 

Source: myjoynnews

New agency inaugurated to boost revenue collection in oil and gas sector

Finance Minister Mr Ken Ofori-Atta has inaugurated the Multi-Agency Petroleum Revenue Committee (MAPREC) to coordinate the efforts of state institutions in the oil and gas sector in order to improve petroleum revenue collection.

The Committee, with membership from the Ministry of Finance, the Ghana Revenue Authority, Petroleum Commission, Ghana National Petroleum Corporation, Bank of Ghana and Ministry of Energy will come out with pragmatic measures to address the challenges associated with the petroleum revenue collection.

The Committee under the Chairmanship of Kweku Kwarteng, Deputy Minister of Finance, would work to identify constraints that have caused underperformance of oil and gas revenue, and adopt remedial measures to improve collection.

The set-up of the committee followed a study undertaken by the Ghana Oil and Gas for Inclusive Growth (GOGIG) Programme in partnership with the Ghana Revenue Authority to assess and identify potential revenue losses along the oil and gas decision chain.

The study was to provide further understanding of the constraints in petroleum revenue collection while informing the Ghana Revenue Authority and the GOGIG Programme of appropriate areas for interventions that optimize revenue collection.

The work of the MAPERC will bridge the coordination gap existing amongst state institutions in the oil and gas sector to improve revenue collection.

Mr Ofori-Atta said revenue generation was a major challenge and therefore any effort geared towards finding avenues to ensure that those who have to pay do so and to create a society in which people fulfil their tax responsibility was welcomed.

He said the non-payment of taxes was very pervasive either through the lack of knowledge or the inability of the country’s systems to capture them.

While there were about 10 million economic active people, out of which about four million in formal employment, only 1.1 million people paid their taxes.

The informal sector where the bulk of economic activities occur, have only 200,000 paying their taxes.

Mr Ofori-Atta said to reverse some of these trends in the oil sector, the committee would work to push understanding among stakeholders and increase accountability, which was key to getting the necessary revenue from the oil and gas sector.

He suggested the expansion of the membership of the Committee to include the Ghana Ports and Harbours Authority, the Maritime Authority, and the National Petroleum Authority, to ensure not only the coverage of the upstream sector but also the downstream as well.

Ms Adelaide Addo-Fenning, Team Leader GOGIG, said the five-year governance programme was aimed at promoting inclusive economic growth in Ghana by improving the management of the country’s oil and gas resources.

She said a key objective was to improve revenue capture, adding that the success of the programme would be measured by the extent to which GOGIG was able to support government to increase revenue from the sector as well as strengthen policy and regulatory framework.

Ms Adelaide Addo-Fenning said the DFID-funded GOGIG programme was to also help address capacity constraints by improving the capacity of government agencies involved in the management of Ghana’s nascent oil and gas sector, as well as engaging with a variety of accountability actors involved in improving public scrutiny of the sector.

“A key objective is to support government to maximize the benefits that can be derived from the nascent industry. Clearly all indicators show that it is going to be key driver of economic growth in the short and medium term,” Ms Addo-Fenning added.

She said GOGIG in the past two years had provided capacity building support to the Ghana Revenue Authority, help with the income tax act, and Petroleum Revenue Management Act regulations.

She said a study carried out in collaboration with GRA to identify areas of potential revenue losses and to enhance revenue capture in the Petroleum Industry, showed the need for coordination among the institutions involved in the sector.

It also stressed the need to clarify guidelines and regulations, as well as simplifying some of the arrangements.

“If the agencies are better coordinated there is a better chance of raising more revenue,” she added, and pledged GOGGI continuous support to the institutions and the committee.

 

Source: Ghana News Agency

Stop frustrating review of AMERI deal – ACEP to Minority

he Africa Centre for Energy Policy (ACEP) is urging the Minority in Parliament to revise its current posture towards attempts to review Ghana’s power agreement with AMERI.

ACEP is of the view that the contract was overpriced and must be investigated without partisan considerations.

The Minority in Parliament, last week went ahead with a planned boycott of deliberations on the urgent motion for a reversal of the AMERI Power Agreement by the Mines and Energy Committee.

It argued that, the motion was not debated on the floor of Parliament before being forwarded to the Mines and Energy committee.

But the Executive Director for ACEP, Benjamin Boakye, said the minority’s boycott will not promote an effective probe of the agreement.

“The Committee is still sitting and the majority side has a quorum to sit and they are doing so, but I will think that the minority even with their own challenges with the way the probe is happening, could still have been there to point out their disagreement so that all of that becomes a public record.”

“If this new government wants to do something similar, how will the minority be able to critique it? I think they should all be part of the process and allow KT Hammond to have his right and activate the processes of parliament. If you have challenges with that, you have to point it out, rather than walk out to allow only the majority to have their way in the manner that it is turning out,” he said.

K.T. Hammond, who was the ranking member of the Energy Committee of Parliament in 2015, when the deal was approved, filed an urgent motion seeking to reverse the deal due to his conviction that the deal was not value for money.

The John Mahama administration in 2015 agreed to rent the 300MW emergency power from AMERI at the peak of the country’s power crisis.

As part of the agreement, AMERI was to build the power plants and operate them for five years before transferring it to the government.

The deal received parliamentary approval on 20th March, 2015. But subsequent details suggested that, the government may have been short-changed by AMERI as they presented an overpriced budget.

Parliament is reconsidering the deal to possibly reverse it if evidence of the state being shortchanged is found.

Cancelling AMERI deal will be disservice to Ghana – Donkor

Meanwhile, former Minister for Power under the John Mahama government, Kwabena Donkor, has warned that reversing the deal will lead to a dip in foreign investments into the country.

Go to court over AMERI deal – Jinapor dares gov’t

A former deputy Power Minister, John Jinapor, has also called on the Member of Parliament (MP) of Adansi-Asokwa, K.T Hammond to seek redress in court if he wants to challenge the validity of the AMERI deal.

 

Source: citifmonline

LPG marketers resume supply of gas

Liquefied Petroleum Gas (LPG) marketers say they have started supply of the product at retail outlets with immediate effect.

The move they say is to ensure uninterrupted supply of gas across the country.

The decision to resume operations, according to the Association of Oil Marketing Companies, was reached after an emergency meeting with major players in the sector on Thursday, October 19, 2017.

The operators shut down their business for two days to, according to them, enable maintenance works at their outlets and to ensure compliance with safety regulations.

The shutdown of LPG outlets caused a shortage of gas in some parts of the country.

Read the statement below.

aomcs

 

Source: myjoyonline

We can’t tell when gas stations will be reopened – Gas Marketers Association

The Liquefied Petroleum Gas (LPG) Marketers Association says it cannot tell when its member will resume operations at their respective outlets to serve consumers.

PRO of the Association, Bernard Owuridu, explained that they have shut down gas stations to pave way for internal scrutiny and maintenance.

According to him, they have constituted a technical team which is yet to finish its work and advice them when to open to serve consumers following the new Cabinet directive.

“We are waiting for them to bring us their results but we never gave them timelines as we want to give them the free hand to carry out the mandate given them,” he told Joy News’ Evans Mensah on Newsnight, Wednesday.

He added that they are not doing it as a sign of showing any displeasure following the new government directives to their members.

Mr Owuridu explained that members of the Association had a meeting on Tuesday to deliberate on cabinet’s directive on their operations.

He said it was at the meeting that some of the members raised concerns about the closure of some outlets by the National Petroleum Authority (NPA).

“After listening to these members who have been affected by the closures, we felt there was the need amongst us to do some of the things that are of concern to the NPA.

“We constituted a technical team and we gave it the mandate to check the integrity with our installation as well as some safety issue,” he said.

According to him, they do not have the itinerary of the NPA because “as at the time we had our meeting we had about 21 of our outlets which have been closed down.”

Mr Owuridu said it would have helped if they knew this so as to know how to strategise and help consumers by providing service to them.

He, however, said because the Association does not know when the NPA is likely to finish its operation, they have to hold on for the maintenance audit team to finish its work before they can serve consumers.

 

Source: myjoyonline

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