Ghana needs vision to turn resources into blessing

By Ama Achiaa Amankwah- Oslo, Norway

Bishop Akologo, Executive Director of ISODEC has said that Ghana can make a difference in Africa by turning her natural resource endowments into lasting benefits, when she has a vision of extractives.

He stated, “Ghana needs a strategy that defines, articulate and enforce: defensive offensive positions, how to interface natural resources to the national economy, an open, price neutral but key role for the sate and tough on corruption and rent-seeking.”

In particular, he said civil society organisations, the media and the legislature should be empowered for oversight.

He stated this when he made a presentation on “The New Petro-Country Ghana-A New Model for West Africa?” at an oil conference in Oslo, Norway.

The conference was under the theme, “Oil for what Purpose and for whom? It was organised by Populus and three member organizations that are involved in an information project that examines the possibility of a break with what they in double sense may call "the fossil fuel economy ".

This is a model society and economy based on sustained growth in consumption of goods and services produced by polluting energy sources like oil and gas. The group believes that while they are in the North which primarily has served on and powered up the system, it is the South that bears the heaviest burdens and likely will have to take the lead for change.

Bishop Akologo noted that even before the triple crisis; food, fuel and finance, poor countries faced structural rigidities, so cannot build national economies responsive to shocks and trend changes.

Therefore, a new type of economic adjustment-to re-examine relationship between structural adaptation and long-term economic development to build economies to better respond to shocks and trend changes in the environment and take advantage of opportunities is needed.

“Natural resource endowments are the potential catalyst for structural change ambition, but currently not. Little transparency, accountability and participation in the management of natural resources is necessary.”

He recalled hydrocarbon exploration in Ghana started in the late 19th Century in the western region of Ghana in the onshore Tano basin (in 1896), Saltpond offshore production from 4,800 b/d in 1976 down to 480b/d in 1985. Saltpond Field redeveloped in 2002, now producing 500 b/d.

He disclosed Ghana adopts the open door policy of concessioning and that with two major discoveries in 2007 by Kosmos Energy Ghana HC (Kosmos) and Tullow Ghana Limited (Tullow), Ghana stands the chance to be the next oil industry hub in West Africa, with production expected in 2010 starting with 120,000 barrels/day and building up to 250,000 per/day by 2015.

Current exploration activities include Vanco energy – cape three points deepwater, Kosmos Energy – west cape three points, Tullow energy– deepwater Tano, Amerada Hess – cape three points, among other companies in data review/ negotiations.

According to Bishop, ISODEC’s key policy and advocacy goal is to “secure policy space for citizens to engage their governments to construct autonomous development of their countries including securing their resource base and cherished values” in the sub-region.

He said ISODEC’s vision is for Ghana to be an integrated and fully developed energy country that is a key driver of a sustainable and flourishing local and regional economy, while attaining global competitiveness in all of its sub-sectors by 2020 in the Gulf of Guinea.

“Sustainable, operating transparently with the full support of the government, through effective governance will include locally owned and managed energy-based companies … throughout the complete value chain … both local and global.”

He stressed Ghana will become the regional financial and energy trading centre, supported by a strong and vibrant capital market, world-renowned educational institutions, a technology hub that stimulates innovation and entrepreneurship, a strong public-private sector partnership and a strong, responsive , transparent and accountable oversight institutions (parliament, media and CSOs).

He said Ghana needs to transform, structure and diversify national economy using natural resource as catalyst, and that it is a blessing that needs to be built upon.

He believes the energy industry will be the primary driver of economic activity in Ghana, accounting for an average of 40% of the country’s GDP over 2011 to 2030 (based on constant 2000 prices).

He said Ghana must embark on an ambitious and far-reaching programme to achieve widespread and sustainable development by the year 2030.

“Given the strategic importance, potential and scope, the energy sector will be a major driver for economic development, while providing a platform for significant development of people, enterprises, the capital market and innovation and technology”.

This, he stressed allows for Ghana an opportunity to use the energy sector as a catalyst / agent for sustainable development and diversification of the national economy.

He said although host countries own the petroleum resources, they need international oil companies to provide efficiency, particularly in the area of state of art technology, modern field practices, risk capital, efficient operational management and cost efficiency through competitive benchmarking.

However, he said oil companies must be able to cooperate with government authorities and must have reasonable expectation or rewards.

Bishop cited Norway and Trinidad and Tobago as models to learn from, as well as Nigeria (how not to do it and some ideas on reservoir management).

The conference focused on bringing the voices from the South, and examined the challenges face in the North in order to contribute in their way. Norwegian Agency for Development Cooperation (NORAD) is sponsoring the project.

Fokus er satt på hvordan oljeressursene i Sør forvaltes og hvordan Norge og norske selskaper forholder seg til dette. The focus is on how the oil resources in the South are managed and how Norway and Norwegian companies relate to this. Men debatten vil også berøre vår egen hjemlige debatt om de norske oljeressursene og det som skal skje på Miljøtoppmøtet i København i desember. But the debate will also touch upon our own domestic debate on the Norwegian oil resources and it will happen at the Environmental Summit in Copenhagen in December.