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ACEP TO ORGANISE AFRICA OIL GOVERNANCE SUMMIT SOON

Introduction

That there “could be a link between oil wealth and under-development, poverty, environmental problems, and social and economic challenges described as “oil curse” remains a huge challenge confronting not only development experts, policymakers, energy, oil and gas analysts but also stakeholders especially in Africa where the phenomenon (oil curse) seems to be pronounced.

 

There is also abundant literature that suggests that oil wealth can be transformative if the structures for good governance are embedded in the political economy of oil and gas development. However, experience and realities on the ground has shown otherwise.

 It is to these ends that the African Center for Energy Policy (ACEP) is creating a platform for development experts, policymakers, energy, oil and gas analysts to brainstorm and find alternative policies to the above phenomenon in a two-day International Conference here in Accra Ghana from the 23-24 November 2015.

 The Summit dubbed “Africa Rising as Oil Curse beckons for most countries – Is good governance the missing link between oil wealth and development?” focusing on relevant themes and countries,  and the first of its kind in Accra, the event will seek to bring ‘relevant stakeholders and citizens together to discuss and build consensus on key governance policies for efficient and transparent management of Africa’s oil wealth for positive development’ that has meaningful impact on the lives of the citizens says ACEP.   

 The recent discoveries made by many African countries “has been described as the last oil frontier of the world”, providing landmark opportunities for African governments to transform their economies and deliver tangible development outcomes to the people.

 Governance

The Conference will put much emphasis on ‘governance challenges facing Africa’s oil producers’, unlike most of the oil and gas summits or conferences organized on the continent focusing on corporate platforms, often devoted to discussing business opportunities. These platforms do not involve African citizens in the deliberations, thereby alienating their interests from policy formulation and governance processes. They are therefore excluded from promised benefits whilst being exposed to real impacts, which give way to extreme dissent, accounting for violent reactions in some countries ACEP identifies.

 Envisaged to be an annual event, will be the launching of an “Africa Oil Governance Report” which will document and highlight progress made in oil governance on the continent.  Another important feature of the Summit is the tripartite participation of Government, Oil Companies and Civil Society Organizations, which make the summit a true dialogue.

 Participation

A total of 200 participants are expected to attend the Summit drawn from  Government Ministries, Industry Regulators, Accountability Institutions, National Oil/Gas Companies, Heads of Missions of some African Embassies in Ghana, International Oil Companies, Civil Society Organizations to mention a few

Objectives 

At the end, participants are expected to come out with three main objectives. They will evaluate the progress made by Ghana and Africa in the area of oil governance, provide platform for national and continental consensus building on policies that must be adopted to deepen oil governance in Africa and finally identify best practices in oil governance for adoption by other African countries where oil and gas is produced.

 Outcomes

It also expected that consensus will be built on key governance policies in the sector such as an increased accountability to the people by Governments and oil companies involved, citizens are better informed about the benefits and impacts of the industry and finally ensure that dialogue between Governments, oil companies and citizens has been institutionalized.

 Focus Ghana

The summit will also witness a full session focusing on Ghana’s experience as a new oil producer. To be held at the Labadi Beach Hotel 23-24 November, is significant because it marks exactly five years of oil production in Ghana from Jubilee fields. Under the theme “Five Years of oil Production in Ghana – The State of oil Governance and Reflections for African oil Procedure” the Ghana session will look from ‘discovery to production’.  Captured as one of the new frontiers, Ghana has been at the forefront of laying good governance structures for the management of her oil and gas resources.

 Since the commencement of oil production in 2010, Parliament has passed a number of landmark legislations. The Petroleum Revenue Management Act 2011 (Act 815), Petroleum Revenue Management (Amendment) Act 2015, the Petroleum Commission Act 2011 (Act 821) and the Petroleum (Local Content and Local Participation) Regulations (LI2204) have been passed. These legislations have extensive governance provisions that underscore Ghana’s resolve to depart from the path of the “oil curse” and instead use her oil wealth to develop and transform the country for the benefit of her people.

 The benefits of oil to the country have already been pronounced through employment and the government budget. Five years into oil and gas production, more than 130 million barrels of crude oil has been exported from the Jubilee Fields, making oil the second largest foreign exchange earner of the country after gold; about US$3 billion has been received by the Government, and more than 7,000 Ghanaians have been reported to have been employed by the oil and gas industry.

 However, many believe that Ghana could have benefited more from oil if the government put in place other important governance structure and systems that improved on transparency and accountability in the oil and gas sector. This is based on the facts that oil contracts are not awarded through open and competitive bidding process, beneficial ownership information in oil deals remain state secrets; whilst contract disclosure remain the discretion of the Minister of Petroleum. The country has recognized these defects and has initiated the process of introducing greater transparency in the oil and gas industry through the new Petroleum (Exploration and production) Bill. There are also others who believe that Ghana’s institutions are still weak and incapable of checking potential abuses by government functionaries and oil companies.

 The most important justification for focusing the first Summit on Ghana is based on the fact that Ghana’s oil sector will face important decisions late this year or early 2016 including but not limited to the following:

 Parliament will be debating and passing an important legislation – the new Petroleum (Exploration and Production) Bill, expected to repeal the current Petroleum (Exploration and Production) Law (PNDC Law 84).

  1. Ghana’s EITI process will go through another Validation in October.
  2. Government will be issuing Regulations on Petroleum Revenue Management.
  3. New Oil Contracts will be submitted to Parliament for approvals.

 The need for broad consultations on the roadmap to effective oil governance in Ghana cannot be over-emphasized.  However, the process must involve a national evaluation of the governance gains made so far, identification of weaknesses and gaps, and recommendations for up-scaling governance policies and structures to make Ghana a model for other African countries discovering or producing oil ACEP concept paper notes.

 source: Seibik Bugri

 

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