Industry experts as well as Ghanaian law makers in approving the Corporation’s budget for its 2020 activities, urged financial prudence in managing the scarce resources.
The Parliamentary Select Committee on Mines and Energy asked GNPC to look for potential investors to take over the Prestea Sankofa Gold Limited to change its fortunes.
GNPC’s COVID-19 response plan
In the era of the COVID-19 pandemic and its ravaging impact on economies across the world, the GNPC itself has stressed the need for the country to consolidate gains made in the sector, asserting “we have to pursue an aggressive change in strategy; there should be a more serious focus on increasing investment in GNPC operated block.
Other planned projects are investment in the petroleum hub, marine patrol vessels, and fertilizer and biotechnology projects.
The non-petroleum capital projects would involve the Accra Head Office, the Corporate Operational Head Office in Takoradi, Research and Technology, Works and Landed Project, refurbishment of the Petroleum House in Tema, completion of works on Chapel Hill and works on redevelopment of the Takoradi Beach Road.
A partnership with TOR
Dr Zormelo, Managing Director of Zormelo and Associates, a human resources consultant in the oil and gas space, urged GNPC to invest in some strategic partnership with the Tema Oil Refinery (TOR) to refine oil produced in-country.
According to Dr Zormelo, “if they are going to form a strategic partnership with TOR so that they can refine our oil to world standards and at efficiency levels that meet world standards then I’m all for it.
He pointed out that once Ghana is able to refine the crude, the other companies that use the by-products could connect.
“We have a lot of plastic manufacturing companies here who can take one the by-products and expand themselves, produce for the West African market and beyond that we can talk about opportunities in the African Continental Free Trade Area (AfCFTA).
There are opportunities for GNPC and TOR to do more collaboration. The National Oil Company should use its resources to support TOR to modernise its operations and undertake economically viable projects.
No meaningful diversification in oil and gas sector
Speaking to calls for diversifying oil and gas resources, Dr Zormelo said there were limitations when it came to diversification within the industry. If it is about refining the crude then we can talk about diversification, using the by-products of crude, plastics among others.
GNPC has the resources to diversify but is it going to import the oil or is it going to utilise what we produce her?
If it is just going to diversify into things that Goil and others are already into then there is no point because that market is already glutted.
It appears the financial position of Ghana’s NOC is shaky and the COO admitted its budget was slashed.
The 2019 annual report of the Public Interest Accountability Committee (PIAC) showed that the GNPC in 2019 lifted only one cargo instead of three due to its inability to mobilise the needed resources to fund the activity.
The two remaining cargoes were according to PIAC used to defray the development and production expenditures incurred by the ‘Sankofa Gye Ntomme’ (SGN) partners.
PIAC blamed the development on the quasi fiscal expenditures of GNPC which the Committee said had increased in recent years and was posing a threat to the finances of the corporation. PIAC believed the expenditures were beginning to affect the cash flows of the corporation, making it difficult for it to honour its cash calls.