The President-elect, Nana Addo-Danqua Akuffo Addo’s, campaign promise to relocate the headquarters of the Ghana National Petroleum Corporation has come under criticisms during his thank you tour to the Western Region. This promise which was recently repeated during his visit to the region as the president-elect has sparked up conversations and argument particularly among players as well as civil society organizations which have called on the president-elect to rescind the decision.
The corporation was established as a state-owned company with the statutory backing of PNDC Laws 64 and 84. The law mandated the corporation to engage in exploration, production and disposal of petroleum products. The law also established the legal structure and defines the nature of contractual agreements. In 1987, the Petroleum Income Tax Law under the PNDC Law 188 was added to the corporation’s mandate to permit it to tax various petroleum products for consumption. As a state agency the corporation has been sited close to the seat of government in Tema.
In a round-up to the 2016 general elections, the then presidential candidate and president-elect on the ticket of NPP promised the people of the Western Region to relocate the state-owned enterprise, GNPC, to the region if given the nod to be president. Not long before he was elected, the yet-to-be sworn in president reiterated his intention to fulfill his promise made during the campaign.
He made this known when he made a courtesy call on the Western Regional House of Chiefs at Sekondi on Monday, 28th December, 2016. “The commitments that we have made are commitments that are going to be fulfilled. They were not platform or campaign talk. They were full commitments that we made… We are going to relocate the headquarters of GNPC to this region,” he indicated. This according to the president-elect was one of the vision of the party to make the region the oil hub in West Africa.
However, this move has received many criticisms from industry players such as Africa Centre for Energy Policy (ACEP), Strategic Thinkers Network (STRANEK) and many others. According to Dr Ishmael Ackah, head of policy unit at ACEP, who indicated that the decision by the president-elect was “not well thought through”, the intention has the tendency to put decision makers in a tight corner since oil exploration and production will commence in other regions of the country.
In another development, a statement co-signed by the Executive Directors of STRANEK, Nii Tettey Tetteh and Charles Kwadade described the move as a “promise in bad taste” because if the promise is carried through would have a high cost implications and cause disruption in relocating the enterprise.
Though the decision to relocate the corporation to the Western Region is a laudable one since it will satisfy the people of that region it must be subjected to critical cost benefit analysis to see the feasibility of it. The following will have to be answered affirmatively if the move is feasible: what is the total cost in relocating the corporation? Are the current personnel going to be relocated too or new workers are will be recruited from the region? Who will fund the accommodation allowances of the current workers who will be moved to the said location? Will the NPP government establish similar corporations in other regions where explorations are taking place like the Voltaian basin in the Volta Region and Tano basin in the Brong Ahafo Region of the country? These and other countless questions need to be answered before such a move is initiated.
The relocation of GNPC is in fulfilment of the president-elect’s campaign promise to the people of the Western Region. Unfortunately, a careful subjection of the issue under the microscope has several implications on the country. Some have described the decision as a mere political talk whilst others think otherwise.
It is recommended that the government as well as decision makers should consider establishing satellite offices in the regions where exploration is taking place and report to the headquarters. It is equally recommended that, alternatively, the Petroleum Commission which is the regulator is relocated to the Western Region instead of GNPC.
Notwithstanding these contentions regarding this promise it is recommended that a second look at this campaign promise will save the country a lot of cost and the oil price volatility that is taking a serious toll on the economy.
www.reportingoilandgas.org- Kwabena Tabiri