By Mohammed Awal
awalm19@gmail.com
awalm19@gmail.com
THE
AFRICA Centre for Energy policy (ACEP), a policy and economic think
tank, says there is so much murkiness and corruption in the oil and gas
industry, as oil blocks are dished out to petroleum retail companies.
According to the think tank, these petroleum retail companies, most of
them from Nigeria, have no experience in the management of deep water
field, yet they are the companies “we are giving oil contracts.”
The Executive Director of ACEP, Dr.
Mohammed Amin Adam, revealed to journalists that the process of awarding
Ghana’s oil blocks is fishy, thus the need for transparency along the
contract value chain.
He said the contract awarding process is
so corrupt and shrouded in extreme opacity and secrecy, to the extent
that if Ghana does not take care, it may end up as an oil-cursed nation.
“Ghana must avoid the curse of oil, and
the only way we can avoid the curse of oil is to open the process of
giving out oil blocks… so that we can attract the best companies to
Ghana,” cautioned Dr. Amin Adam.
He was speaking at a stakeholders’ forum
on the topic: ‘Open Contracting in the Oil and Gas Industry’, organised
by ACEP in Accra last Thursday. He, therefore, called for the
establishment of a progressive regime that will establish an open and
competitive bidding process, as the yardstick for the award of future
oil contracts.
“Open contracting means transparency
along the contract value chain,” he stated, as it would send a signal
that attracts quality investors, warning; “The lack of it breeds
corruption and investments that do not pursue the public interest.”
The Petroleum (Exploration &
Production) Bill 2014, which is before Parliament waiting passage into
law, attempts to address the problem associated with the application of
administrative processes in petroleum licensing.
Clause 10(3) of the Bill establishes an
open and competitive tender regime for the acquisition of oil blocks.
But, Dr. Amin Adam notes that they, at ACEP, have serious issues with
the Bill in its current format, as it contains certain exceptionally
mysterious clauses that defeat the idea of transparency and
accountability.
Ghana, at the moment, does not apply the
open and competitive public tender process in oil concessions –what it
applies is the administrative process, where oil concessions are awarded
based on discretionary power.
“We are not comfortable with the current
state of the bill, especially, relating to the contracting process.
“This is the first time the bill is introducing that, unfortunately
there are other provisions in the bill which undermines the proposal for
open and competitive bidding.
For instance, the Minister has the power
to veto the outcome of an open and competitive bidding process, and to
use sole-sourcing to award a contract in the oil sector,” he announced.
Whilst c.10 (3) establishes an open
bidding regime, he explained, c.10 (4) gives the Minister the leisure to
ignore the outcome of an open and competitive tender process, and to
use direct negotiations.
The dangers associated with this process
are many, he stated, warning, that the Minister may use his power to
shield companies that do not want to go through competitive process, and
turn back to negotiate directly with them.
Also he observed that the process may be
used to expose the terms offered by competing companies to give
competitive advantage to those that prefer direct negotiation. However,
the Ministry of Energy has explained that those clauses are necessary,
since they may not find any of the competing companies satisfactory, in
terms of the technical and financial capacity.