Crude oil production declined for the 5th consecutive year in 2024 – PIAC report

Ghana’s crude oil production has declined for the fifth consecutive year, dropping to 48.25 million barrels in 2024 from a peak of 71.44 million barrels in 2019, according to the latest annual report by the Public Interest and Accountability Committee (PIAC).

The report shows an average annual decline of 7.4% over the five years.

Beyond declining production, PIAC’s 2024 report highlights major issues with petroleum revenue management.

It revealed that GNPC Explorco failed to pay US$145.68 million in oil lifting proceeds into the Petroleum Holding Fund (PHF) in 2024. This brings the total unpaid revenues by JOHL and GNPC Explorco to US$488.79 million by the end of the year.

Despite GNPC’s insistence that these proceeds do not qualify as PHF payments, PIAC maintains they represent indirect State participation and must be paid into the fund.

Another key concern is the US$2.89 million in surface rental arrears owed by International Oil Companies (IOCs), most of which are tied to companies whose petroleum agreements were terminated in 2021.

Key Recommendations

In response to the findings, PIAC has made several recommendations to strengthen governance, accountability, and investment in the petroleum sector:

1. Parliament should ensure that the Ministry of Energy and its allied agencies increase efforts to secure investments in Ghana’s upstream petroleum industry.

2. The Committee reiterated its position that proceeds from liftings by GNPC Explorco constitute indirect participation of the State and therefore must be paid into the Petroleum Holding Fund.

3. The Ghana Revenue Authority, the Petroleum Commission, the Bank of Ghana and the Ministry of Energy should collaborate to recover the Surface Rental arrears.

4. Government should expedite action to expand its gas infrastructure capacity to take up more raw gas.

5. Government should determine specific programmes for implementation over the course of the Priority Areas before selection of the Priority Area.

6. Parliament should ensure that the Ministry of Finance complies with Regulation 8 of L.I. 2381 in setting the cap on the GSF.

7. PIAC reiterates its recommendation in its 2024 Semi-annual Report that the State conducts cost and technical audits on the TEN Field to establish the basis for cost escalation and technical challenges on the Field in recent years.

8. Parliament must take steps to insulate GNPC and GNPC Explorco from loans and guarantees on behalf of Government, its agencies as well as national and local infrastructure projects.

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