11 SOEs owe GNPC $549m – Indebtedness covers only 2020

Eleven state-owned enterprises (SOEs) owe the Ghana National Petroleum Cooperation (GNPC) $549.3 million.

Eleven state-owned enterprises (SOEs) owe the Ghana National Petroleum Cooperation (GNPC) $549.3 million.

The debt is in the form of loans and outstanding payments to the GNPC receivable from the government and other SOEs for the period 2020.

Of the amount, the government directly owes the GNPC $18.09 million on guarantees to SOEs, the Ministry of Finance Enclave Roads owes GH¢26.9 million and $17.19 million, GNPC’s advance to the Ministry of Finance amounting to $50 million, the Tema Oil Refinery (TOR) owes $58.4 million, while ECG-Bank Guarantee related charges amount to $4.96 million.

The Ghana National Gas Company (Ghana Gas) owes the GNPC $37.9 million over its construction of the 14-kilometre offshore pipeline; a loan from the GNPC sitting on the Ministry of Energy’s current account at the GCB Bank is $14.58 million, while the Offshore Cape Three Points (OCTP) escrow account amount due the GNPC is $100 million.

Other debts are ‘ECG HFO commitment (Litasco)’, which is $200 million, and the Ministry of Finance/Bulk Oil Storage and Transportation (MoF-BOST) underscores, $21.3 million.


These were contained in a report by the Finance Committee of Parliament on the annual report of the Public Interest and Accountability Committee (PIAC) on the management of petroleum revenues for 2020.

The report, signed by the Chairman of the Finance Committee, Mr Kwaku Kwarteng, was submitted to the House last Wednesday.

Other receivables

Per the report, other receivables due to the GNPC were from gas sales to the Volta River Authority (VRA) and Ghana Gas, the commercial arm of the GNPC, amounting to $817.63 million, and GNPC guarantees on behalf of Karpower, amounting to $145.5 million.

“The Ministry of Finance responded that it has cleared its outstanding debt of $50 million to the GNPC. It explained that that was done through the release of funds amounting to the cedi equivalent of $50 million, which otherwise should have been withheld due to capping,” it indicated.

Receipts into PHF

Per the report, total receipts into the Petroleum Holding Fund (PHF) for 2020 was $666.39 million, comprising $496.28 million from lifting proceeds and $170.1 million from other incomes — corporate income tax, surface rentals and interests on PHF balance.

The receipt is 27.96 per cent lower than that for 2019, while it was 42.5 per cent of the 2020 budgeted petroleum revenue.

Distribution of revenue from PHF

The report said $638.64 million was disbursed from the PHF, which was 30.96 per cent less than the distribution in 2019.

It said out of the amount, $198.7 million was given to the GNPC, $273.4 million to the Annual Budget Funding Amount (ABFA), $116.6 million to the Ghana Stabilisation Fund (GSF) and $49.9 million to the Ghana Heritage Fund (GHF).

Unutilised balances of the ABFA

It further said GH¢827.6 million of the unspent ABFA was utilised to partially meet shortfalls in ABFA receipts caused by the impact of the COVID-19 pandemic and its associated effect on crude oil prices globally.

“The Ministry of Finance explained that the GH¢827 million that was utilised was not as a result of a shortfall in ABFA receipts for 2020 but rather it was in respect of outstanding projects under the ABFA that were completed in 2020 and duly paid for,” the report quoted the Finance Ministry as clarifying.

On the utilisation of the ABFA, it said disbursement to capital projects ranged from GH¢3,000 to GH¢29.6 million, with the median disbursement for the ABFA-funded projects being GH¢1.28 million.

It noted that PIAC had observed that such a thin spread of the revenue weakened the impact of the revenues because the projects tended not to be completed in time for citizens’ use.

That, it said, led to cost escalation and undue delay, a reason PIAC recommended that the ABFA should be invested in fewer national legacy projects that would be completed in good time for the benefit of the country.

Pay debts to GNPC

Contributing to reporting, the Minority Spokesperson on Finance, Dr Cassiel Ato Forson, expressed worry over the alarming indebtedness to the GNPC and called for steps to be taken by the SOEs to pay their debts to the corporation.

While accusing the government of not being able to account for the unutilised GH¢827 million, he asked Parliament to haul the Finance Minister before it to account for the amount.

In a reaction, a Deputy Minister of Finance, Dr John Kumah, said every penny used could be accounted for, and that same had been reported to PIAC at the committee level.
















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