Ghana’s Ministry of Finance has proposed to Parliament to allow it to exclude gas revenues to the tune of US$181.80 million from the projected petroleum revenues for 2019, while it devises ways of getting the Volta River Authority (VRA), a power producer, to pay for the gas supplied it by Ghana Gas.
Ken Ofori-Atta, Minister of Finance, who made the recommendation during his presentation of the 2019 Budget Statement to Parliament, on Thursday, said the VRA, would nevertheless be pursued to pay its gas bills as required by the Petroleum Revenue Management Act (Amendment), 2015 (Act 893).
“Furthermore, as a measure to minimise the amount of gas produced in the SGN Field for power production”, he said, “Government has decided to postpone the extraction of its share of the gas resource (Royalties, and Carried and Participating Interest (CAPI), until such a time that we line up off takers to consume the gas in-year.”
He announced that the benchmark crude oil price for 2019 had been projected at $66.76 per barrel, in line with the Petroleum Revenue Management Act (Amendment), 2015 (PRMA).
The 2019 Benchmark Revenue crude oil output is 63.4 million barrels (173,764 barrels of oil per day); while the gas price for the period has also been projected at 3.99 US dollars per MMBtu,
“If this House grants us this request, the projected petroleum revenue for 2019 will amount to US$1.1 billion,” he stated.
That, he said, was made up of Royalties (US$227.10 million), Carried and Participating Interest (US$602.80 million), Corporate Income Tax (US$249.60 million) and Surface Rentals (US$1.10 million).
“Of this amount, US$404.90 million will be ceded to the NOC for its Equity Financing Cost (US$320.10 million) and share of the Net Carried and Participating Interest (US$84.80 million), US$473.0 million allocated to the Annual Budget Funding Amount (ABFA), while the GPFs receive US$202.70 million.”
The Minister said “The GPFs’ receipts will be distributed between the Ghana Stabilisation Fund (US$141.90 million) and the Ghana Heritage Fund (US$60.80 million).”