• 3 minutes Looming European Gas Crisis in Winter and North African Factor - a must read by Cyril Widdershoven
  • 7 minutes "Biden Targets Another US Pipeline For Shutdown After 'Begging' Saudis For More Oil" - Zero Hedge Monday Nov 8th
  • 12 minutes "UN-Backed Banker Alliance Announces “Green” Plan to Transform the Global Financial System" by Whitney Webb
  • 8 mins GREEN NEW DEAL = BLIZZARD OF LIES
  • 2 days China's aggression is changing the nature of sovereignty.
  • 4 days Building A $2 Billion Subsea Solar Power Cable From Chile To China
  • 1 day Ukrainian Maidan after 8 years
  • 3 days OPEC+ Expects Large Oil Glut In Early 2022
  • 2 days Delta variant in European Union
  • 2 days Hunter Biden Helped China Gain Control of Cobalt Mines in Africa
  • 10 hours Communist China Declared War on the US Long Ago Part 1 of the 2-part series: The CCP's War on America
  • 3 days Forecasts for Natural Gas
  • 3 days Microbes can provide sustainable hydrocarbons for the petrochemical industry
  • 1 hour President Biden’s Nuclear Option Against OPEC+ - Waste of Time
  • 14 hours Сryptocurrency predictions
  • 2 days NordStream2
  • 2 days CO2 Electrolysis to CO (Carbon Monoxide) and then to Graphite
  • 3 days Big Bounce: Russian gas amid market tightness - new report by Oxford Institute for Energy Studies
Oxford Business Group

Oxford Business Group

Oxford Business Group (OBG) is a global publishing, research and consultancy firm, which publishes economic intelligence on the markets of the Middle East, Africa, Asia…

More Info

Premium Content

Ghana Doubles Energy Revenue With Increased Oil Production

A report from the central bank shows that Ghana’s state oil revenues more than doubled between the second half of 2016 and the first half of this year, from $93.4m to $191.3m, driven largely by increases in production levels.

Output levels have risen steadily since the start of production at the Tweneboa, Enyenra and Ntomme (TEN) oilfields in August 2016, jumping from 91,000 barrels per day (bpd) that month to 121,000 in September 2016 and rising steadily thereafter, to 165,000 bpd as of March, according to the US Energy Information Administration. Together the three fields contributed $94.2m to the revenue figure, with the remaining $97.1m coming from the Jubilee oilfield, where production began in 2010 but has been slowly declining in recent years.

The TEN fields are located in the Deepwater Tano licence area and operated by Tullow Oil, which has a 47.2 percent stake alongside its joint venture partners Kosmos Energy (17 percent), Anadarko Petroleum Corporation (17 percent), GNPC (15 percent) and PetroSA (3.8 percent). Tullow expects production from the fields to average 23,600 barrels per day (bpd) this year.

The rises in output and revenue have benefitted state coffers, allowing the government’s Petroleum Holding Fund to distribute some $277.8m in that period – up from $141.9m in the previous six months – to government accounts including the Ghana Stabilisation Fund, which serves as a rainy-day account, and the Ghana Heritage Fund, which serves as a savings pool for future generations.

Short-term production increases at TEN and Sankofa fields expected

Output should increase even further in the near future – in May the Sankofa field began producing oil ahead of schedule, and it is expected to start with natural gas as well in February 2018.

Related: The EV Boom Is Dead Without Proper Support

Sankofa is part of the $7.9bn Offshore Cape Three Points Project operated with a 47.2 percent stake by Eni, and partners Vitol (37.8 percent) and GNPC (15.0 percent). The new field is projected to generate some 45,000 bpd.

Together the TEN and Sankofa fields were initially expected to lift Ghana’s crude oil production to an average of 123,416 bpd this year, up from 88,487 bpd in 2016, according to projections in the March budget. However, as output has since risen from the newer fields, the deputy minister of energy, Mohammed Amin Adam, said in June total average production this year could top the 200,000-bpd mark.

The new fields’ added output should help Ghana move closer to its target of 6.3 percent economic growth for this year, up from 3.5 percent in 2016 and 3.9 percent in 2015. In an encouraging sign, the IMF recently raised its growth forecast for Ghana from 5.8 percent to 5.9 percent in 2017; however, it also warned in March that the country “remains at high risk of debt distress” and urged fiscal consolidation to bring down borrowing levels.

Ghana’s financial standing has taken a hit in recent years as prices for its main export products –gold, cocoa and especially oil – have fallen. This put downward pressure on the local currency: in the two years to August 2014 the cedi halved in value against the dollar, to GHS3.8:$1, and has since fallen further to GHS4.3:$1.

Sinking prices also affected business earnings and cut into receipts from corporate income taxes, driving a $278m shortfall in 2015 alone, according to the Natural Resource Governance Institute. The result has been a steady build-up of public arrears, with the debt-to-GDP ratio jumping from 34 percent in 2010 to 73 percent in 2016, according to the finance ministry.

Fall in revenues could impact ability to reduce fiscal deficit 

Despite rising oil output and revenue, external factors still cloud the road ahead somewhat for the country’s finances. Related: NatGas Prices Aren’t Going Anywhere Fast

Ghana based its 2017 budget on the assumption that Brent crude prices would average $56 per barrel, but these have since declined to $48.60 per barrel as of early September. This could limit Ghana’s ability to rein in its fiscal deficit to 6.5 percent of GDP this year, according to Courage Martey, an economist at Databank Group based in Accra.

The country is also facing broader challenges in meeting earnings targets: revenue and grants from January to April came in at GHS11bn ($2.5bn), 17 percent less than the budget had predicted, largely due to the decline in oil prices.

With such concerns in mind, in June the deputy finance minister, Charles Adu Boahen, announced that Ghana would ask the IMF to extend its $918m debt support programme, scheduled to end in April next year, to December 2018.

By Oxford Business Group

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News