The Ghana National Petroleum Corporation, GNPC may be granted permission, where necessary, to borrow above the 30 million dollars cap if the investment will be to the benefit of the country.
That is the position of the African Centre for Energy Policy, ACEP.
The newly passed Petroleum Exploration and Production Bill makes it necessary for the GNPC to seek Parliamentary approval if it intends to borrow above 30 million dollars.
This comes on the back of calls for the GNPC to be regulated in the provision of guarantees for some major oil deals which continue to impact on its operations.
Though the Executive Director of ACEP, Dr. Mohammed Amin Andam admits that the 30 million dollars window may not be enough for oil operations, he is confident the check will protect the national purse.
“I think that 30 million dollars is not enough for operations relating to oil exploration, development and production. That is why I think that it is important that for long term investments such as exploration investments, development and production, you do not just allow GNPC to go borrowing as much as it wants because that industry is risky and to the extent that they can borrow and Ghanaians will bear the continuous liability if GNPC defaults or unable to make returns on the investment made,” he stated.
GNPC has received criticisms for a number of loan agreements and guarantees over the years.
But the corporation has on almost all occasions justified any of such decisions, insisting that they are necessary to deepen GNPC’s scope in the country’s oil and gas sector.
For instance in November 2014, the CEO of GNPC, Alex Mould defended a 700 million dollars facility it secured from the Deutshe Bank of Germany.
This was in the face of criticisms from civil society groups and a member of the opposition NPP, Gabby Otchere Darko who claimed that the corporation was undertaking the deal without Parliamentary approval.
Also in May 2016, the Member of Parliament for Efutu, Alex Afenyo Markin suggested that Parliament scrutinizes the GNPC’s decision to provide 100 million dollars guarantee to owners of the Karpower barge.
This also came at a time that Parliament had demanded that managers of GNPC be made to answer some questions on the floor of the House when its 2016 budget was presented for approval.
In a sharp rebuttal, CEO of GNPC, Alex Mould maintained that the guarantee was actually in line with their mandate as an enabler of the petroleum industry in Ghana.
“The GNPC is not over extended. GNPC is well capitalized and GNPC has a mandate to ensure that it is an enabler in the industry especially for its mandate of disposing the petroleum it generated from the ground,” he stated in an exclusive interview with Bernard Avle.