STORM OVER GNPC & BLACK STARS DEALApril 23 | Posted by oilgas | News in Brief
Some oil and gas sector activists have criticised the Ghana National Petroleum Corporation (GNPC) over its decision to sponsor the senior male soccer team, the Black Stars, suggesting the decision is illegitimate, inappropriate and ill timed.
The GNPC, which holds the state?s interest in oil, is replacing Goldfields Ghana Limited (GGL) as headline sponsors of the Black Stars in a deal that is worth $3 million annually for three-years, according to a report published by SuperSport.com on 4th April, 2012.
The deal comes almost five years after Ghana discovered the black gold in commercial quantities and 16 months since production began at the Jubilee Field, an offshore location on its western coast.
?Is that how best we want to spend our oil money?? queried Mr Ishmael Edjekumhene, Director of the Kumasi Institute for Technology, Energy and Environment (KITE), in an interview with Public Agenda in Accra on Thursday.
?I am a football fun but to tell you the truth if we are going to be spending $3 million every year on the Black Stars?I have a problem with that,? he stated, inquiring further that the ?corporate world is ready to sponsor, so where is the GNPC coming from??
According to Mr Edjekumhene, ?There are a lot of priorities in this country, people need real support,? he argued, observing that the nation would be better served if the money was applied to provide social infrastructure and interventions.
?Look at the way cholera is wiping our people out. For some of the people is just a borehole. US$3 million, do you know how many boreholes we will be able to drill? Look at the Odaw River that we are so proud to say that it is dead. How much money do they need to dredge that river? So I think there are a lot of priorities including the so-called schools under trees.?
Some of Ghanaians, especially in Accra, have been struck with cholera in recent days with health authorities running sensitisation programmes on good hygiene practices. Elsewhere across the country, more than 4,000 basic schools are being run under trees, according to President John Evans Atta Mills who told Parliament recently that about 1,700 of them were being provided with proper infrastructure.
Mr Edjekumhene also objects to the sponsorship for legal reasons. ?I think is a misplaced priority especially where football doesn’t fit within the priority areas? spelt out in the Petroleum Revenue Management Law (PRMA) Act 815, 2011.
?Unless it is the bonuses and the surface rent that they are not declaring that they are going to use, it’s a contravention of the law. If it is the money that is coming from government?the petroleum revenue fund that is going in to support football that is wrong; it is not a priority area as spelt out by the law unless it is GNPC’s own internally generated fund. In any case, how can they have internally generated funds??
The Act provides in Section 21(3) a list, in no order of priority, of 12 areas where oil revenues should be invested in the absence of a long term national development plan. These include: agriculture and industry; physical infrastructure and service delivery in education, science and technology; potable water delivery and sanitation; infrastructure development in telecommunication, road, rail and port; physical infrastructure and service delivery in health; and housing delivery.
Others are environmental protection, sustainable utilization and protection of natural resources; rural development; developing alternative energy sources; the strengthening of institutions of government concerned with governance and the maintenance of law and order; public safety and security; and provision of social welfare and the protection of the physically handicapped and disadvantaged citizens.
Apart from these, alleged underhand dealings scare Mr Edjekumhene, who represents civil society on Ghana’s novel Public Interest and Accountability Committee (PIAC), created by the PRMA to assist in the monitoring of petroleum revenues.
?You know all the hullaballoo that has come up, people looking for their cuts and things like that,? he said, referring to media reports that a certain Westhead claimed it initiated the deal and would seek its commission when the deal is sealed.
Westhead, according to reports, is a company which has secured a Ghana Football Association mandate to seek for sponsorship for various Ghanaian national teams.
When the rumour broke, GNPC Board Chairman, Mr Ato Ahwoi, denied the involvement of any third party in brokering the sponsorship. ?The decision to sponsor the Black Stars emanated from us and no such third party,? ghanasoccernet.com quoted Mr Ahwoi.
Other media reports suggested the GNPC was entering into the deal for marketing purposes which could be informed by investment reasons.
But Mr George Mireku Duker, who has recently joined the Civil Society Platform on Oil and Gas, argues that the Black Stars are a good brand and able to attract sponsorship from the corporate world. Therefore, GNPC’s money would serve a better purpose if it is channelled into building capacity of Ghanaian businesses and individuals to meaningfully participate in the oil and gas sector in order to catalyse the realisation of the nation’s local content and participation targets.
?Why is GNPC rushing to sponsor Black Stars? We are now calling for local content? to allow at least 90 percent Ghanaian control of the oil and gas sector so why don’t we think of rather investing in them, bringing their capability levels to levels that are desirable??
Ghana’s Local Content and Participation Policy envisions that at least 90 an oil projects should be in Ghanaian hands ten years after the initiation of a project. So for the Jubilee Project, the target is the year 2020.
On this score, Mr Duker urges that ?We should bring people up, we should invest in the education sector, we should invest in our road infrastructure, we should invest in other sectors that people can see; the tangibility aspect of it must also be brought to bear.?
He goes on to warn that: ?If we don’t take care and in the near future people start to agitate, people start to call for accountability with respect to our revenue from the oil and gas sector we are going to be found wanting. What are you going to show? Are you going to tell them that I have invested in the Black Stars? And are people going to be happy with you for saying that you sponsored Black Stars?”