Oil’s contribution to Ghana domestic revenue is increasingly gaining ground as a tenth of domestic revenue in 2018 emanated from oil and gas.
Analysis of data from the Ministry of Finance’s Fiscal Data and the Public Interest Accountability Committee (PIAC) report, shows that the contribution of oil to domestic revenue continues to record significant growth, from when in 2016 it recorded just three percent of domestic revenue.
The International Monetary Fund (IMF) in its World Economic Outlook in April, projected that the percentage contribution of petroleum revenue to domestic revenues will rise further in 2019 barring any external shocks.
Between 2011 and 2018, domestic revenues increased averagely by 22 percent a year.
A year by year analysis of change in domestic revenue between 2012 and 2018 reveals that the year 2014 had the highest percentage of 28 percent increase in domestic revenue. This is largely due to high oil prices during the period.
Over the past two years, oil contributions have led to a 20 percent annual increase in domestic revenues.
With oil prices averaging high as US$ 99.03, the contribution of petroleum soared to 12 percent in 2014 but thereafter dipped to three percent in 2016 due to bearish oil prices averaging US$ 43.74. The year 2014 recorded the highest average annual crude oil price over the last five years.
“Investing petroleum revenues in high impact projects and diversifying resource sector is key to broadening the domestic revenue base and sources,” says Mr. Gidoen Ofosu-Peasah, a Natural Resource Economist and Consultant at the Africa Centre for Energy and Environmental Sustainability.
Crude Oil and Gas Production in 2018
A total of 62,135,435.07 barrels of crude oil were produced from Ghana’s three
production fields in 2018, where Jubilee Field produced 28,461,775 barrels representing 45 percent of total production; TEN produced 23,557,361 barrels or 38 percent; and SGN produced 10,751,671 barrels or 17 percent.
In 2017 total crude production was 58,658,063.54 barrels. This translates to a 5.93 percentage points increase in 2018.
A total of 91,459.30 Million Metric Standard Cubic Feet of raw gas was produced from the Jubilee, TEN, and SGN Fields in 2018, compared to 77,294.44 MMSCF in 2017.