No payments into Petroleum Holding Fund despite US$46m revenue in 2018

The Public Interest and Accountability Committee (PIAC) has revealed that although Ghana National Gas Company (GNGC) made proceeds to the tune of over US$46 million in 2018, this did not reflect in the Petroleum Holding Fund (PHF).

PIAC in its semi-annual report on the management of petroleum revenues for the first half of 2018 revealed that despite the proceeds, GNGC made “no payment to GNPC in respect of gas supplied, for which reason no gas receipts were realised in the Petroleum Holding Fund (PHF).”

The GNGC, the report revealed, has explained that it used the realised revenues to cover its operational cost.

PIAC has recommended that the GNGC discontinue the practice of retaining gas revenues.

“Receipts from the sale of gas derivatives must be applied to defray the cost of raw gas supplied by GNPC, for lodgement in the PHF in accordance with Sections 2 & 3 of the Petroleum Revenue Management Act (PRMA).

The following constitute the receipts of the Petroleum Holding Fund:

(a) royalties from oil and gas, additional oil entitlements, star-face rentals, other receipts from any petroleum operations and from the sale or export of petroleum;

(b) any amount received from direct or indirect participation of the government in petroleum operations; (c) corporate income taxes in cash from upstream and mid-stream petroleum companies; (d) any amount payable by the national oil company as corporate income tax, royalty, dividends, or any other amount due in accordance with the laws of Ghana; among others.

The PHF feeds the Ghana Stabilisation Fund which sustains public expenditure during periods of unanticipated petroleum revenue shortfalls.