In ensuring a proper regulation of the Ghana National Petroleum Corporation (GNPC), the Institute for Fiscal Studies (IFS) has recommended the need for parliament to enact a new statute for GNPC since the current founding law of the Corporation, PNDC Law 64 of 1983, has become redundant in many parts.
The current law falls short of satisfying the strong and keen public demand for transparency and accountability from the State-Owned Oil Company in contemporary times.
In the Think-Tank’s new report, “Assessing Management of the Ghana Petroleum Funds and Ghana National Petroleum Corporation (GNPC) Revenue”, the new law would offer the opportunity to revisit or incorporate the considerable latitude given the Corporation to engage in diverse kinds of activities, which may need to be curbed, specifying activities the Corporation cannot do.
The report suggest that in the proposed new law, there should be an expansive in public information disclosure requirements, which would be mandated to strengthen transparency and accountability.
Furthermore, a second look must be given to the corporate governance of the Corporation, in particular the powers to appoint the board and the board’s composition.
In just two years, spanning from 2014 to 2016, the Corporation lost more than GHc 40.5 million in investments made in non-core businesses, such as Prestea Sankofa Gold, Airtel and the Mole Motel.
In 2018, GNPC’s expenditure on Corporate Social Responsibility (CSR) was about US$28.9million. This, the IFS indicates as extreme and hampers the company’s efficiency and performance.
Within the same period, GNPC was owed by government and other government-related agencies to the tune of GHc 794.6million through quasi-fiscal activities.
GNPC 2019 Budget
On Wednesday, a Ranking Member of the Select Committee on Energy, Adam Mutawakilu disclosed to the media that Parliament has slashed the GNPC’s 2019 expenditure budget by 80 million dollars.
The committee questioned the US$ 50 million the Corporation has requested to use for the construction of a refinery, as parts of government’s plans to make a Petroleum hub in the country.
GNPC plans to spend some US$43 million on various projects, such as boreholes and educational scholarships for persons within the communities the company operates, as part of its Corporate Social Responsibility in 2019.
Although the amount represents 8 percent of the corporation’s total budget of about 800 million dollars for 2019, industry watchers are of the view that the US$ 43 million for CSR is extreme as against the US$ 20 million the Corporation plans to spend on its core operations including the development of the Voltain Basin.