How a Good Law May Not Stop Oil Money from Going Down the Drain
Ghana discovered oil and gas in commercial quantities in 2007. Since then significant efforts have been made to ensure the transparent and efficient management of revenues generated from the exploitation of these resources. A Petroleum Revenue Management Act 2011 (Act 815) and a Petroleum Commission Act 2011 (Act 821) have been passed by Parliament. Local Content Regulations have been laid before Parliament. There are also new bills that are going through consultations for submission to Parliament. These include a Petroleum (Exploration and Production) Bill and Marine Pollution Bill. These efforts have been lauded as signs of a country working hard to avoid the curse of oil, the experience in many oil producing countries in Africa, where oil and gas resources have brought conflicts, corruption, and poverty. However, it is becoming clear that the enactment of good legislations provides an environment for doing things right, but does not always guarantee that things will be done right.
In this report “The two sides of Ghana – How a good oil revenue law does not stop oil revenues from going down the drain”, captures cases of poor planning and spending decisions for oil revenues; inefficient investment management and “business as usual”, two years since oil started flowing in the country.