The Petroleum Commission says Ghana’s first generation oil contract at the Jubilee Fields was purposely to attract investors and not to make profit.
A Consultant at the Commission, Samuel Frimpong Topen, has told Adom News the reason was that Ghana’s basin had failed to reveal oil in larger quantities, thereby deterring investors from coming on board.
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He said because of that, the first contract royalty was pegged at only 4% for Ghana, and that attracted investors who later discovered more oil to lure other investors into the country.
“When Kosmos made the first discovery and became successful, they partnered with Jubilee which prompted the other investors to come on board which is why all the oil producers are closely linked to one location as indicated on our oil exploration map”, he said.
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Samuel Topen further stated that subsequent contracts have seen an increase in the royalty allocated to Ghana and there are plans to increase it in upcoming contracts.
He however explains that after explorers have deducted their operational cost (Oil Cost), Ghana gets a share in the remaining earnings in the form of taxes, making Ghana’s total share 58%.
Mr Topen was speaking on the fringes of a workshop organized for the media by the Petroleum Commission.
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He added that plans are in place to ensure GNPC would be able to finance the cost of a full extraction without sharing the profit with any foreign company.
“Most oil producing countries have oil producing companies who are learning from the foreign producing companies and for now I can tell you that GNPC is of age and now they can be producers with their own field” he said.