Category: News

 

The Registrar-General’s Department (RGD), has commenced the validation of companies in line with the directive for dormant companies to file their returns.

Companies that fail to file returns face being delisted from the Companies Register.

The three-month-long review began on July 1, 2021, and will end on September 30, 2021.

“The review has become necessary after the Final Notice was issued on 18/03/2021 to officials of dormant Companies to file their Annual Returns to be in good standing with the Department,” it noted in a statement.

The strike-off exercise became necessary as a result of the Department’s Company database being bloated with names of dormant companies entered onto the Companies Register.

“In summary, 257,241 Companies existing in the new database had not filed their Returns or Amendments with the Department, and 670,282 Companies in the Legacy system had not carried out their re-registration as at the release of the first Notice in March 2020,” the statement outlined.

“Companies due for strike off still in default after this three-month review would be published in the National Dailies and the Department’s website. A Company’s status at this period would be classified as being inactive and would not be able to be accessed for any business transaction for the next 12 years except by a Court Order to the Registrar to restore it to a status of good standing in the Companies Register,” the statement added.

The department thus advised such companies  “to use this three-month review to undertake all the necessary measures to be in good standing with the Department if they were not able to do so all this time and are still interested in carrying on business with that name.”

It reminded companies that the penalty for late filing remains GH¢450.00 and GH¢50.00 for filing of Annual Returns for each year.

  

Adnan Adams Mohammed

The Bank of Ghana has assured commercial banks account holders whose dormant accounts will be transferred to the central bank that they will not lose their funds. 

Following directives from the Central Bank, all commercial banks and specialised deposit-taking institutions (SDIs) are to transfer all funds in dormant accounts to the Bank of Ghana. 

Many Ghanaians  have  raised  concerns after the directive was announced. Many fear that, funds transferred to the Central Bank will be almost impossible to retrieve the funds due to the cumbersome bureaucracies in the public service. But, the BoG has dismissed such fears.

“Customers whose dormant accounts are transferred to the Bank of Ghana do not lose such funds”, the central bank said in a statement.  

“They or their legal representatives can make claims for the funds by presenting all relevant documentation”, the statement said, adding: “Identification and claiming of funds at the Bank of Ghana is not a tedious process”.  

Read the BoG’s full statement below: 

PRESS RELEASEADDRESSING MISCONCEPTIONS ABOUT THE BANK OF GHANA’S DIRECTIVE ON DORMANT ACCOUNTS 

The attention of the Bank of Ghana has been drawn to information circulating on social media to the effect that customers whose accounts are dormant should hurriedly reactivate their accounts or risk losing their funds to the Bank of Ghana.  

The Bank of Ghana wishes to inform the general public that the recently published directive on dormant accounts seeks to provide directions to banks and Specialised Deposit-Taking Institutions (SDIs) on how to protect accounts of customers which have remained inactive (no deposits or withdrawal) for a period of two years. 

Such accounts are placed in dormant accounts registers and after further three years of no reactivation, the funds are transferred to the Bank of Ghana.  

The key ingredient in the reactivation process is the identification of the customer. 

Customers whose accounts fall in this category are encouraged to contact their bankers to reactivate the accounts.  

As a proactive measure, the Bank of Ghana’s directive urges banks and SDIs to contact customers whose accounts are dormant to reactivate such accounts.  

Please note that as part of the directive, banks and SDIs will publish accounts that remain dormant for a period of five years on their websites and in two daily newspapers, as a means of notifying account holders who may not have reactivated their accounts. 

For additional protection of accounts that have remained dormant for a minimum of five years, funds in such accounts will be transferred to the Bank of Ghana by banks and SDIs after the newspaper publication.  

Customers whose dormant accounts are transferred to the Bank of Ghana do not lose such funds.  

They or their legal representatives can make claims for the funds by presenting all relevant documentation.  

Identification and claiming of funds at the Bank of Ghana is not a tedious process.

 

Adnan Adams Mohammed

Key stakeholders in Ghana’s energy industry are calling on the government to as a matter of urgency to privatise the Tema Oil Refinery (TOR) and bring in an enterprising leadership.

According to an industry player, it is time to allow Private Sector Participation as successive governments have failed to retool and operationalize the country’s once viable asset. This, they believe can yield the needed results the country is yearning to derive from the deteriorating state asset as it is currently engulfed with ballooning debt and operational inefficiencies. 

Fortnight ago, the President sacked both the managing director and deputy of the Refinery in the wake of recent impasses at the refinery between top management and junior staffs and workers. The Energy Minister has thereby inaugurated an Interim Management Committee to take up management and control of the facility until a substantive Board and Management team are appointed. 

But, the Chairman of the Association of Oil Marketing Companies wants government to quickly privatise the Refinery before investors lose interest as he believes that, should government privatise TOR, the job opportunities will be enormous.

“In any case if we have private participation in there, it doesn’t mean loss of jobs or anything. If you’re building the capacity you’re creating more jobs. A 300,000-barrel capacity refinery is going to create so many jobs for everyone,” the AOMC and the outgoing Managing Director of Engen, Henry Akwaboah emphasized. 

However, an energy Strategist and Lead Technical Consultant to COPEC in suggesting some alternative solutions to end the over decade long under-performing of the nation’s only refinery urged government to appoint a visionary and enterprising leader to manage the Tema Oil Refinery (TOR).

“TOR currently needs an enterprising leader to turn the fortunes of the Refinery around”, Dr. Yusif Sulemana posited when he reacted to the sacking of the TOR MD and his deputy. “The refinery has been idle and part of this is because of these issues. They do not have stable leadership. So going forward, the MD is fired. We need to get a stable leadership. We need to get a leader who is business minded and I can tell you government needs to get an enterprising, energetic, selfless person to take charge of the refinery with a business focus.”

He further noted that the next Managing Director must be committed to work to improve the operations at the refinery “like a business” within a given time frame, with the requisite resources provided.

Meanwhile, government has appointed a 3-Member Interim Management Committee to oversee the affairs of the Tema Oil Refinery. 

The chairman of the IMC is Mr Nobert Cormla-Djamposu Anku. The other members are Mr William Ntim Boadu and Mr Okyere Baffuor Sarpong.

The committee has been tasked to, among others, ensure the smooth transition from the outgone directors, to undertake technical and human resource audits, as well as receive and assess viable partnerships for TOR.

Speaking after the swearing-in ceremony at the refinery, the energy minister, Dr Mathew Opoku Prempeh noted that TOR and its crippling debts, infrastructural issues and equipment have been well noted, and that since the 4th Republic, every president has thought about value addition to Ghana’s natural resources.

Dr Prempeh urged the staff of the refinery to put all rancour behind them, cooperate with the IMC and work hard to ensure the success of the refinery.

Consequently, the Executive Secretary of the Chamber of Petroleum Consumers (COPEC), Duncan Amoah has charged the Ministry of Energy to outline Key Performance Indicators for the next Managing Director to be appointed to steer the affairs of the struggling Tema Oil Ref
inery (TOR).

“Once you start putting the right persons in place, you’ve solved one of the 3 key challenges needed to be dealt with for TOR to be turned around. You need a sound and competent management in place, you also need to detach the overbearing politicking or political interference that happens with the refinery and the third one, get the right investments to upgrade their tools and equipment.”

“We would be hoping that the new managers will be coming in with a certain performance agreement with their appointers knowing strongly what their timelines are in the first 3 months, 6 months, a year etc,” he added.

Also, the Member of Parliament for Dormaa East, Paul Apraku Twum Barimah commended the President, Nana Akufo-Addo and the Minister of Energy, Mathew Opoku Prempeh for taking the initiative and the bold step to revive The Tema Oil Refinery.

Paul Twum Barimah believes that TOR is a strategic facility in the oil sector and therefore reviving it will boost the downstream petroleum sector in Ghana.

According to Mr Twum Barimah, the government has taken the responsibility to pay the legacy debt of TOR and changed the entire management of TOR; a move which saw the MD and his deputy being relieved of their posts.

Speaking in an interview with the Media, he said the move by the president of Ghana and the Minister of Energy will help bring sanity and calm at TOR and lead to the transformation needed to promote efficient production.

 

Ghana’s 2021 budget, titled Economic Revitalization through Completion, Consolidation and Continuity, was widely anticipated. Ghanaians hoped that the budget would include steps to address both the immense challenges brought on by the coronavirus pandemic and low revenues resulting from a downturn in crude oil prices. Revenue shortfall amounted to GH₵13.6 billion while expenditures rose by an estimated GH₵11.7 billion in 2020; this has led to more uncertainty about the future of Ghana’s recovery plans.

In addition, as in many other African economies, debt also threatens the projected economic recovery in Ghana, something the government has acknowledged in the 2021 budget.

Commodities are expected to play an important role in addressing Ghana’s debt challenges. Petroleum exports will likely decline in the medium term , from a peak of 71 million barrels in 2019 to about 59 million barrels in 2024, and so will revenues. Though crude oil prices have recovered from the depths of the second quarter of 2020, there is no guarantee that these will be sustained, thus limiting the role of petroleum revenues in addressing Ghana’s debt burden. Nonetheless, petroleum is still an important source of revenue and a likely part of the solution to Ghana’s public financial challenges.

Unresolved governance issues

Despite the 2021 budget’s attempt to address concerns around petroleum revenue spending in Ghana, it fails to address key governance questions around what will happen to unspent revenue and what constitutes public investment, among other issues.

Allocation for public investment

Public investment is generally understood to be spending on assets or infrastructure with long lifespans. But the lack of a clear explanation of Ghana’s public investment expenditures has over time led to various approaches by the Ministry of Finance on where to allocate the funds, leading to disagreements among different stakeholders. For example, between 2011 and 2016, 70 percent of oil revenue designated for budget support (the Annual Budget Funding Amount, or ABFA) was allocated to capital spending, which includes roads, agriculture, education and health infrastructure, against 30 percent allocated to recurrent expenditure, which typically covers payments for services and supplies. The Petroleum Revenue Management Act (PRMA) Section 21(4) states: “For any financial year, a minimum of seventy percent of the Annual Budget Funding Amount shall be used for public investment expenditures consistent with the long-term national development plan or with subsection (3).”

In 2017, the government prioritized spending of oil revenues on “physical infrastructure and service delivery in education,” in line with the PRMA. Civil society organizations raised concerns about whether this spending was consistent with the Ministry of Finance’s previous interpretation, which had restricted public investment expenditure to capital spending Between 2017 and 2019, recurrent expenditure on the Free Senior High School Program, which included the payment of fees and supplies, represented an average of 52 percent of ABFA. The Public Interest and Accountability Committee (PIAC) called on the government on numerou
s occasions to adhere to the Ministry of Finance’s previous interpretation of the PRMA but the government argued that investment in education qualifies as public investment expenditure and that is not entirely synonymous with capital expenditure, with an explanation included in the 2021 budget.

This changing interpretation of “public investment expenditure” has led to recurrent expenditures for which volatile petroleum revenues are ill-suited. Previous NRGI research has emphasized the challenges with spending volatile resource revenues on recurrent expenditure. There is broad consensus that public investment in key sectors can enhance growth. Ghana’s government should clarify the definition of public investment expenditure to refer to only non-recurrent expenditure in the PRMA Regulations (L.I. 2381) or in a PRMA amendment.  This would also encourage consistent implementation of the rule by future ministers of finance.

Unspent petroleum revenues at the end of the year

The use of unspent petroleum revenues at the end of the budget year is another unsolved issue. Successive governments have managed unspent ABFA differently since this first came up in 2014. That year a total of USD 222.93 million (GH₵666.06 million) of ABFA was unspent. The amount, according to the Ministry of Finance, was returned to the Bank of Ghana at the end of that year as the bank assessed the government’s financial position. However, in 2015, the Ministry of Finance did not disclose of how it applied a balance of GH₵36.41 million. The following year’s Ministry of Finance reconciliation report made no mention of the unused balance, as it should have. Similarly, the Ministry did not account for the unused balance of GH₵77.73 million at the end of 2016 in its report to the parliament.

In 2020, the Ministry of Finance brought forward and spent unused ABFA from 2017-2019 (amounting to GH₵1.48 billion; see figure above) alongside allocations for 2020. Since 2018, the PIAC and other civil society actors have called upon Ghana’s government to provide details of the unspent revenues; these calls only elicited a public response in the heat of the campaign leading up to the December 2020 elections. According to the ministry, the combined 2017 and 2018 amount of GH₵652.29 million was transferred to the Road Fund while 2019’s GH₵827.60 million was used to meet the 2020 ABFA shortfall due to the pandemic. It is unclear which provisions, if any, in the PRMA support the transfer of unspent ABFA into the Road Fund or to meet ABFA shortfalls in subsequent years. Also unclear is which year’s appropriation (budget)—which provides the legal authorization to spend based on agreed activities—covered the spending of these unused revenues.

Additional challenges to the financial management of Ghana’s public sector include delays in the contracting process for projects, disbursement of funds and contract execution. Issues related to unspent ABFA will continue unless these challenges are resolved. Dialogue and consensus building among stakeholders on how to treat unspent funds in the future would avoid various conflicting interpretations arising between provisions in the Public Financial Management Act and the PRMA.

While the PRMA does not prescribe how unused ABFA at the end of the year should be treated, Section 21(1) provides that it must be part of the national budget and subject to same budgetary processes, bringing the ABFA under the public financial management rules in terms of management and accounting. And Section 26 of the Public Financial Management Act states clearly that such appropriations lapse by the end of the first month of the following year, meaning that the government needs a new appropriation from the parliament to use these funds.

Section 26 of the Public Financial Management Act, 2016

Inability to spend within the appropriation period, for whatever reason, creates public financial management complications in terms of unspent balances, re-budgeting and project execution. With petroleum funds, unspent funds make tracking and accounting for revenues within the framework of the PRMA provisions difficult.

Ghana’s government must urgently tackle the underlying issues of public financial management and delays in projects on which the money is spent. In addition, stakeholders (the Ministry of Finance and ministries that receive ABFA; oversight bodies like PIAC and Ghana EITI; and civil society actors) must engage in order to answer the following questions and possibly factor them into future amendments of the PRMA:

What should happen to unused ABFA and where should these unused funds be saved?

Should new appropriation in accordance with the Public Financial Management Act allow for a change in projects and programs earmarked in a previous appropriation?

Does government ringfence ABFA funds, and if not, should they?

Discretionary capping of the Ghana Stabilization Fund

The Petroleum Revenue Management Regulations (L.I. 2381), passed in 2019, sought to address the situation where the minister of finance sets a discretionary cap on the Ghana Stabilization Fund by defining a formula for setting the cap. Regulation 8(1) states “In pursuance of Section 23 of the Act, the Minister shall, in recommending the maximum amount of accumulated resources in the Ghana Stabilisation Fund, ensure that the amount is not less than the average Annual Budget Funding Amount over a three year period.” While this provides guidance for setting a maximum balance on the fund, no minimum amount is specified; this could leave little money in the fund for its stated purpose of addressing revenue volatilities or debt. Though the 2021 budget did not propose a cap, the implementation of L.I. 2381 will mean that the Ghana Stabilization Fund would likely not grow beyond USD 400 million in the medium term (based on petroleum revenue projections in the 2021 budget). While a lower ceiling on the Ghana Stabilization Fund would make funds available for real-time debt servicing, it reduces the opportunity for government to rely on the fund to address shocks to the economy, fund future budgets and service future debt.

Ways forward

Resource revenues and good public financial management have the potential to help address Ghana’s financing and borrowing needs, and its economic recovery plans. To ensure this potential is realized:

The government should adhere to the generally accepted interpretation of public investment as referring to non-recurrent spending, and clarify this in the Petroleum Revenue Management Regulations (L.I. 2381) to avoid using volatile revenue streams for recurrent expenditures.

The Ministry of Finance should initiate consultations on an amendment of the PRM regulations that would provide clarity on how government should manage unspent revenues.

The government should undertake a review of the capping mechanism of the stabilization fund.

 

Denis Gyeyir is an Accra-based Africa program officer with the Natural Resource Governance Institute (NRGI).

 

Adnan Adams Mohammed

Ghanaians are seriously agitating against the skyrocketing increase in prices of building materials in recent times.

The untold trend have pushed some high profile Ghanaians to add their crying voice as a former Deputy Finance Minister has charged Parliament to look into the reasons behind the leapfrog hikes in the prices of building materials such as sand, stones, cement, iron rods and the likes inspite of the effect of COVID-19 on cost of living.

Some key stakeholders in the building and construction sectors, such as, the Ghana Chamber of Construction Industry have pointed out that, Ghanaians are likely to struggle to rent and acquire houses in the near future, if nothing is done to halt the unusual rise in the price of building materials. 

 

 

“if the situation is not checked, prices of other building-related services will also rise”, speaking on the floor of Parliament on, last week,  Kwaku Kwarteng, a member of parliament for Obuasi alarmed.

“These price developments have triggered further hikes in building-related services, such as excavations, drilling, tiling etc. Indeed, I have heard complaints that even water supply to construction sites and construction labour have all become unusually more expensive. It is hard to figure out the source of these unusual price increases. We know that Parliament has not passed any law that could have added any tax or levy to the prices of these items.”

“Mr. Speaker, it is a strange development that must be frontally addressed. We need to check this for the sake of the construction industry, and more importantly, we need to get to the bottom of this disturbing development to ensure that it does not spread to other commodities and other industries on the market. It is, therefore, my respective view that Parliament needs to take steps, under our standing orders and the law, to assist the country deal with this matter,” he added.

 

The CEO of the Chamber of Construction Industry, Emmanuel Cherry, speaking against the development said, that is what they have been calling on government to take a keen interest in the issue as it will eventually impact its budget.

 

“Honestly speaking we have taken a key interest in the issue, that’s the reason we took the pains to petition parliament. So we welcome the call by the former Deputy Minister of Finance. The time to correct the development is now. There is no better time than now to take steps to save this country. Because a time is coming if we are not careful you cannot rent or buy a house because of this challenge.”

 

“A time is coming, if government is not careful, building cost is going to be so alarming that a kilometre of road is going to be expensive. Even as we speak, automatically, all contractors who have abandoned site if they are moving back, their contracts might have to be reviewed upwards, which will impact government’s budget. So let’s all come together to resolve the problem before it gets out of hand,” he added.

As the demand for houses increases, the COVID-19 induced restrictions have had a negative toll on the construction industry.

This has been widely attributed to the exponential increase in construction materials, which are mostly imported.

Some of the major construction items which prices have been affected include iron rods and cement.

It is worthy to note that a ton of iron rods which used to cost GHS4,000 only a few months ago has shot up to a little over GHS5,000.

Checks have revealed that, a bag of cement has increased by GHS3 from GHS38 and now selling at GHS41.

Samuel Amegayibor, Executive Secretary of Ghana Real Estate Developers Association (GREDA) believes these price hikes have contributed to the dip their businesses are currently facing.

“I called the cement manufacturers, and they admitted that there has been a price hike, and it’s because of certain challenges they are facing in importing the major material which is called clinker. They are telling us that some of the sources of the clinker have either closed down, and generally, the international market price has gone up and also the cost of freight has also gone, and shipping lines have attributed it to the cost of crude oil, which has also spiked.”

 

 

Adnan Adams Mohammed

Industry players, including investment bankers and business leaders, have lauded the establishment of a Development Bank. 

 

They believe it will serve as a panacea for addressing long term financing challenges experienced by local industries.

The Government of Ghana in partnership with the European Investment Bank, and other international development institutions have committed to the establishment of a new development finance institution in Ghana to provide patient capital for Ghana’s industrialisation agenda. A leading investment banker has endorsed the approach being used for the establishment of the Development Bank Ghana.

“The Development Bank Ghana is set up to attract very cheap capital which should boost Ghana’s economic growth through agriculture and manufacturing”, the Deputy Managing Director of the Ghana Stock Exchange, Abena Amoah speaking at a development finance series organised by Citi TV and Citi FM in collaboration with the research and consultancy centre of the University of Professional Studies in Accra, last week, noted.

Also, the President of Association of Ghana Industries (AGI), Dr Yaw Adu Gyamfi has expressed confidence in the sustainability of Ghana’s development bank.

According to him, the development bank will serve as a panacea for addressing long term financing challenges experienced by local industries.

Speaking at a corporate dinner series for CEOs of Large Corporates organised by the Association of Ghana Industries in Accra, last week, Dr. Adu Gyamfi noted that governance structures being put together for the Development bank inspires hope.

“This is an investment bank and not a depository bank. No one has asked anyone to go and put money there…In terms of the policies and the laws that have been passed, this bank should not be like NIB or ADB, and we are hoping for the best,” Dr. Adu Gyamfi said.

He added that the business community has its “eyes open to ensure that the bank survives” because its survival will mean a lot to the nation’s industrial development and also curb the growing number of unemployment.

The Development Bank Ghana, when fully operationalised, will serve as a wholesale bank, attracting cheap capital and lending to special sectors of the economy through commercial banks.

Despite being described as the bedrock of Ghana’s economic development, the agriculture and manufacturing sectors receive just 4 and 8 percent respectively of investment.

The situation results from the lack of capital due to the short term nature of investment funding available and this propelled the establishment of a new development bank.

This, however, will not be the first time government is establishing a development bank.

According to Dr Emmanuel Debrah, a finance Lecturer at UPSA, all development banks have collapsed due to poor corporate governance.

“When I heard of the Development Bank, what came to mind was all the development banks Nkrumah built. All of them are no more. The question is what have we learnt from there to guide the sustainability of the yet to be operational Development Bank, Ghana… Research has shown that all development banks in the past collapsed due to poor corporate governance,” Dr. Debrah noted.

Subsequently, Director of the Financial Sector Division of the Ministry of Finance, Sampson Akligo, speaking on the same platform, gave the assurance that the Government is plugging all loopholes to ensure the Development Bank Ghana stands the test of time.

“Typically, the way the bank was set up under the Companies Act gives us some level of immunity so in that case, we don’t have direct political involvement. Secondly, we have done all that we can to make sure that recruitment is done through an independent process,” Mr Aklogo said, adding that the diversity of the partners working with the government to establish the bank is a testament to its sustainability.

Addiyionally, Madam Abena Amoah who was on the same panel endorsed the government’s approach noting that “Development bank is structured to raise very cheap funds” which should “allow businesses to borrow into the target sectors”, i.e. manufacturing, housing, agriculture etc.

Speaking on why Ghanaian businesses prefer debts to equity in their quest for funding, Awura Abena Agyeman, CEO of wear Ghana noted that young businesses are not just interested in money but also in what she calls smart Capital.

 

 

Adnan Adams Mohammed

 

An international resource governance organization has slammed the country  2021 budget as it  fails to address key governance questions around the petroleum sector revenue management.

 

It indicated that, despite the 2021 budget’s attempt to address concerns around petroleum revenue spending, keys issues, such as, what will happen to unspent revenue and what constitutes public investment, among other issues were not duly addressed.

Public investment is generally understood to be spending on assets or infrastructure with long lifespan. But the lack of a clear explanation of Ghana’s public investment expenditures has over time led to various approaches by the Ministry of Finance on where to allocate the funds, leading to disagreements among different stakeholders. 

For example, between 2011 and 2016, 70 percent of oil revenue designated for budget support (the Annual Budget Funding Amount, or ABFA) was allocated to capital spending, which includes roads, agriculture, education, and health infrastructure, against 30 percent allocated to recurrent expenditure, which typically covers payments for services and supplies. 

“This changing interpretation of “public investment expenditure” has led to recurrent expenditures for which volatile petroleum revenues are ill-suited”, the Natural Resource Governance Institute (NRGI) shares their worry in recent publication. 

 

Previous NRGI research has emphasized the challenges with spending volatile resource revenues on recurrent expenditure. There is broad consensus that public investment in key sectors can enhance growth. 

 

The Petroleum Revenue Management Act (PRMA) Section 21(4) states: “For any financial year, a minimum of seventy percent of the Annual Budget Funding Amount shall be used for public investment expenditures consistent with the long-term national development plan or with subsection (3).” In 2017, the government prioritized spending of oil revenues on “physical infrastructure and service delivery in education,” in line with the PRMA. 

 

Civil society organizations have raised concerns about whether this spending was consistent with the Ministry of Finance’s previous interpretation, which had restricted public investment expenditure to capital spending. Between 2017 and 2019, recurrent expenditure on the Free Senior High School Program, which included the payment of fees and supplies, represented an average of 52 percent of ABFA. 

 

Also, the Public Interest and Accountability Committee (PIAC) has at several occasions called on the government to adhere to the Ministry of Finance’s previous interpretation of the PRMA but the government argued that investment in education qualifies as public investment expenditure and that is not entirely synonymous with capital expenditure, with an explanation included in the 2021 budget.

 

 

Consequently, the NRGI wants the government to clarify its operational meaning of “public investment” in relation to the petroleum revenue expenditure.   

 

“Ghana’s government should clarify the definition of public investment expenditure to refer to only non-recurrent expenditure in the PRMA Regulations (L.I. 2381) or in a PRMA amendment.  T
his would also encourage consistent implementation of the rule by future ministers of finance.”

HIRED Consult and Saint-Petersburg State Agrarian University (SPbSAU) signs a 5-year Cooperation Agreement on the success of the recently held St. Petersburg International Economic Forum (SPIEF) 2021.

The St. Petersburg International Economic Forum (SPIEF) is a unique event in the world of business and economics held under the auspices of the President of the Russian Federation. In its 24th season, this year was held from June 2-5 in strict accordance with health and safety measures carefully drawn up by the Organizing Committee in line with the WHO recommendations with delegates from over 100 countries and 13,500 in attendance.

With this cooperation agreement, young Ghanaians have the opportunity of a full scholarship to study in the areas of Agriculture in Russia facilitated through HIRED Consult and State Agencies. Mr. John Aggrey is the Founder and CEO of HIRED Consult. HIRED Consult is a youth-led social enterprise with expertise in management and consultancy focused on churning ideas into sustainable and scalable projects through strategy, operations, transformation, and digital delivery across board.

At the opening SPIEF 2021 session of Friends for Leadership, Mr. Aggrey’s speech, “We MUST move from the “table of discussion to the table of action. We are either the table or used as the menu and as youth, our choice is “We are THE TABLE” and which centred on contributions to safe, affordable and nutritious food for a transformative Food Systems through sustainable, responsible consumption and production in addressing lifestyle, food security, climate change, malnutrition, and biodiversity was well received among dignitaries and Russian State Representatives, particularly the Saint-Petersburg State Agrarian University (SPbSAU) who held closed door meeting with this young Ghanaian Social Intrapreneur.

Also in attendance at SPIEF 2021 was H.E. Paul Kwaw Cudjoe Acting Ambassador, Embassy of the Republic of Ghana in Russia. He interacted with some African participants at the forum; “Ghana and Russia have friendly and close bilateral relationship over the years and still continues to enjoy good relations. This agreement reflects it and attest that Ghana is blessed with young talents
who always show patriotism by raising the flag higher wherever they find themselves.” According to him, his office will liaise with HIRED Consult, and State Agencies in Ghana to make this cooperation agreement run smoothly and effectively. H. E Paul Kwaw Cudjoe lauded Mr. Aggrey for this great achievement.

Founded in 1904, St. Petersburg State Agrarian University is a non-profit public higher-education institution officially recognized by the Ministry of Science and Higher Education of the Russian Federation and offers both undergraduate, masters programs and research works of major science fields (agrobiological, agroengineering, agroeconomic).

The Cooperation Agreement was signed by John Aggrey, Founder and CEO of HIRED Consult (Ghana) and Vitalii Morozov, Rector Federal State Budgetary Educational Institution of Higher Education Saint-Petersburg State Agrarian University (SPbSAU) and witnessed by Nadezhda Tcyganova, Vice-Rector for Research, Innovation and International Affairs.

“In the new realities of the COVID-19 pandemic, the Roscongress Foundation was the first to provide a platform for our Friends for Leadership community to meet and work in person. Many participants decided to come to St. Petersburg with a great enthusiasm to promote their projects, sign cooperation agreements and to find new partners, like-minded people and investors. We can say with confidence that SPIEF 2021 was even more eventful for the work of our organization, with the results we have witnessed here,” said Dr. Roman Chukov, Founding Member of Friends for Leadership, Adviser to the CEO of the Roscongress Foundation on Youth Policy and Chair of the Board of the Centre for International Promotion Fund.

Friends for Leadership is an international network of the next generation leaders and entrepreneurs, who share the best SDGs practices and working solutions to bring them into effect to our local communities globally.

More details on the scholarship and how to apply will made known.

For Media/Enquiries Contact:

HIRED Consult (Ghana)

john@hiredconsult.com

 

 

 

Adnan Adams Mohammed

 

Following the court declaration in favor of Springfield Oil Company in a legal suit against Eni Ghana, energy experts have shared their reservations. 

 

The suit by the Ghanaian oil firm, Springfield, sought to compel Eni Ghana to relinquish 30 percent of revenues accrued from the sale of crude oil from the Sankofa field was granted by a Commercial High Court in Accra on Friday, June 25, 2021.

 

The court ruling comes on the back of the unitisation impasse between both oil firms since April 2020 when a directive from the then Energy Minister, Peter Amewu, demanded for the unitization of the Afina and Sankofa fields for the purposes of ensuring optimal recovery of the hydrocarbon resources (crude oil) in the common reservoir in the interest of all the parties involved, including the State. The former Ghana National Petroleum Corporation (GNPC) Chief Executive Officer, with his vast experience oil block contract agreements, has shared an in-depth knowledge on the technicalities of the unitisation impasse. 

 

“I guess the science has proven that the field that Eni found and is currently producing from, and the field that Springfield (SEP) were exploring and subsequently found oil are the same field” Alex Mould recounted in an interview with the paper. 

 

That means, the two fields  in both blocks are actually the same field and therefore “it straddles two different blocks”, that is, the Eni block which is an OCTP and the Springfield block, Mr Mould who doubles as former executive director of Standard Chartered Bank emphasized.

 

However, commenting on the ruling, Kevin Okyere, CEO and founder of Springfield, described the ruling as a positive result and a welcome vindication of Springfield’s position on the issue of unitisation.

 

According to him, Springfield was forced to take the legal route following Eni’s reluctance to follow the unitisation directive and for all parties to reach an amicable resolution.

 

“Springfield is not interested in stalling ongoing crude oil production on the Sankofa Field, but believes in fairness and justice for all, irrespective of their size and position. The consequences of this case for the Ghanaian oil industry will be systemic and immediate,” he stated.

 

Adding that, “Springfield looks forward to wo
rking with Eni as the operator of the unitized field in maximizing the production and the economic benefits for all stakeholders, including the government and citizens of Ghana.”

 

Meanwhile, in his further comments, Mr Mould shared some possible implications of the unitisation of both fields. 

 

This has “some serious implications” for both Eni and Springfield, he said as he listed below:

 

“It means that Eni has been “producing” (spending on operating cost and earning revenue) from the field that belongs to both Eni and Springfield.

 

“ENI has spent money “developing” the field and producing a field that belongs to both Eni and Springfield.

 

“And so “redetermination” has to be done to determine how much of the fuel belongs to Springfield and how much of the field belongs to Eni and the costs and the revenue have to be apportioned  from “Day one that ENI/Vitol started exploring till today”.

 

“Well, that also means that, we have to re-quantify how much gas and oil is in the field and re-look at the economics twin-sure that Eni doesn’t suffer and if it has to be a gas price review; it has to be done”, he posited.

 

The former GNPC boss, who was part and parcel on almost all oil block contract agreement the country negotiated and signed as well as executing the contract deeds has affirmed that “redetermination and re-quantification of both fields as one will benefit Ghana.

 

“This is basically better for Ghana because the economics for Ghana (also known as the Fiscals – Royalties, equity ownership, additional paid in Equity, etc) is better on the Springfield Block contract than it was for the OCTP contract (awarded in 2006).

 

“We negotiated a very tough contract from 2013 for all Petroleum agreements that were given after 2013 …and yes that was under my watch”.

 

In simplifying the technicalities, Mr Mould expatiated that, the bottom line is that the “field size” has increased so the volume of oil has increased.

 

However, the “cost of developing and producing this incremental” oil and gas has not increased proportionally as the revenue has increased.

 

“The implication here for good negotiators of government of Ghana is to do what I call a redetermination not only to know how much goes to Springfield and how much goes to Eni but what is the economics of the new field.

 

“And, in order to ensure that Eni is not made worse off – you have to keep their rate of return as it is or better as per the stabilization clause in the agreement saying that they cannot be worse off, even if a material adverse event occurs”.

 

Consequently, government of Ghana also can be made “better off” in that with the larger field Producing more oil and gas. What that means is that the cost of gas should go down tremendously.

 

“So, let us see how our NPP government officials save Ghana a lot of money in the cost of gas to us.

 

“If they don’t, then we know that they are partners to Eni and Springfield.”

 

Eni Ghana, Operator of Offshore Cape Three Point (OCTP), has announced a significant oil discovery on the Eban exploration prospect in CTP Block 4, offshore Ghana.

The Eban – 1X well is the second well drilled in CTP Block 4, following the Akoma discovery. Preliminary estimates place the potential of the Eban–Akoma complex between 500 and 700 Mboe in place.

The Eban – 1X well is located approximately 50 kilometers off the coast and about 8 kilometers Northwest of Sankofa Hub, where the John Agyekum Kufuor FPSO is located. It was drilled by the Saipem 10000 drilling ship in a water depth of 545 meters and reached a total depth of 4179 meters (measured depth). Eban – 1X proved a single light oil column of approximately 80m in a thick sandstone reservoir interval of Cenomanian age with hydrocarbons encountered down to 3949m (true vertical depth). 

The new discovery has been assessed following comprehensive analysis of extensive 3D seismic datasets and well data acquisition including pressure measurements, fluid sampling and intelligent formation testing with state-of-the-art technology. The acquired pressure and fluid data (oil density and Gas-to-Oil Ratio) and reservoir properties are consistent with the previous discovery of Akoma and nearby Sankofa field. The production testing data show a well deliverability potential estimated at 5000 bopd, similar to the wells already in production from Sankofa Field.

The estimated hydrocarbon in place between the Sankofa field and the Eban-Akoma complex is now in excess of 1.1 Bboe and further oil in place upside could be confirmed with an additional appraisal well.

Due to its proximity to existing infrastructures, the new discovery can be fast-tracked to production with a subsea tie-in to the John Agyekum Kufuor FPSO, with the aim to extend its production plateau and increase production. The Eban discovery is a testimony to the success of the infrastructure-led exploration strategy that Eni is carrying out in its core assets worldwide.

The Joint Venture of CTP Block 4 is operated by Eni (42.469%), on behalf of partners Vitol (33.975%), GNPC (10%), Woodfields (9,556%), GNPC Explorco (4,00%).

Eni has been present in Ghana since 2009, and accounts currently a gross production of about 80,000 barrels of oil equivalent per day.

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