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DECISION TO EXPLORE OR NOT TO EXPLORE OIL IN GHANA

  • POSTED ON: April 13, 2016
  • AUTHOR: Editor
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poil ghaGhana is a relatively new oil and gas producer. The country has Africa’s fifth largest oil reserves and sixth largest natural gas reserves.

The Oil and gas value chain starts with a decision whether to explore or not to explore. At this stage, the country to make two major decisions which are whether to extract or not extract. If a decision is made to extract, the benefit such as increased revenue to government in the form of taxation, royalties and job creation within the economy will be realized. In cases where the decision is made not to extract, then there is a likelihood that, the oil discovered is been left for future generations. Production has been repeatedly delayed in Uganda since 2006 when natural gas was discovered in the Albertine rift basin that straddles its border with the Democratic Republic of Congo since there exists contractual disagreements, tax disputes and infrastructure setbacks and is now expected from 2017. The motivation for outlining these decisions is that, many resource-rich countries have trouble realizing the full development potential of their  resource wealth. Articulating these decisions helps governments and oversight actors understand where they can effect change.

Evidently, the decision to explore oil in Ghana or not hinges on benefits such as revenue that government may accrue from the extraction and when such benefits exceed the cost, companies may be given the license to extract the oil. Ghana earned $100,200,392.21 (one hundred million, two hundred thousand, three hundred and ninety two and twenty one cents) from the twenty-eighth, twenty-ninth and thirtieth liftings from the Jubilee oil field in the second quarter of 2015.

By: Penplusbytes

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Reporting Oil and Gas project was launched on 4th June 2009atTakoradi, Western Region, Ghana by Penplusbytes (PPB – www.penplusbytes.org) with the vision of providing a one stop online information and knowledge about Ghana’s oil and gas sector
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