IN a significant development, the Multi-Stakeholder Group (MSG) of the Ghana Extractive Industries Transparency Initiative (GHEITI) officially unveiled the country’s 2020 Mining and Oil/Gas EITI reports Tuesday, marking the culmination of an extensive effort to promote transparency and accountability in the extractive industries. Published on December 31, 2022, the reports provide valuable insights into Ghana’s mining and oil/gas sectors, shedding light on their contributions to the economy and production figures. The MSG, composed of representatives from the government, industry, and civil society, oversees the operations of GHEITI.
Funded by the prestigious World Bank Extractive Global Programmatic Support (EGPS) Grant, the production of these reports highlights the international recognition of Ghana’s commitment to transparency and good governance in its extractive industries. With the release of the 2020 reports, Ghana has now produced and published a total of 19 mining reports since joining the initiative in 2003. In the case of the oil and gas sector, the 2019 report marks the 10th since its inclusion in the initiative in 2010.
‘These reports signify our dedication to transparency, accountability, and sustainable development in the extractive industries. We are proud to present comprehensive data that goes beyond simple financial reconciliation, encompassing contextual information and fulfilling the requirements of the 2019 EITI Standard,’ stated the Minister of State at the Ministry of Finance, who also serves as the Champion for GHEITI. The reports were jointly launched by the Minister and the Deputy Minister of Lands and Natural Resources responsible for Mining, George Mireku Duker.
To ensure a robust reconciliation exercise, seven oil and gas companies qualified to participate based on the established materiality threshold of $13.6 million. Ghana National Petroleum Corporation (GNPC), Tullow Ghana Ltd, Kosmos Energy Ghana HC, and Eni Ghana (E&P) Ltd actively took part, providing valuable data for the reports. However, Anadarko WCTP Ltd, Vitol, and PetroSA, despite meeting the materiality threshold, failed to submit reporting templates.
On the government side, key entities such as the Ghana Revenue Authority (GRA), Ghana National Petroleum Corporation (GNPC), Ministry of Finance/Bank of Ghana, and Petroleum Commission (PC) contributed their data, which was meticulously reconciled with the information provided by the companies.
In the mining sector, a total of 14 companies participated in the reconciliation exercise, comprising 12 gold mining companies, one manganese company, and one bauxite company. The materiality threshold for their involvement was set at GHS16 million (about $1.5 million). State agencies including the Ghana Revenue Authority (GRA), Office of the Administrator of Stool lands (OASL), Minerals Commission, Municipal and District Assemblies, Ministry of Lands and Natural Resources, and Ministry of Finance collaborated in providing crucial data and information for the mining sector report.
Key findings – Oil and Gas:
According to the reports, the upstream oil and gas sector in Ghana contributed 3.7 percent to the country’s Gross Domestic Product (GDP) in 2020, experiencing a growth rate of -4.6 percent at constant 2013 prices. In terms of production, the total crude oil output for 2020 stood at 66.91 million barrels (MMbbls), a slight decline from the 2019 production of 71.4 MMbbls. This included contributions from major fields such as the Greater Jubilee Field, Tweneboa-Enyenra-Ntomme (TEN) Field, and Sankofa-Gye Nyame (SGN) Field.
The Ghana National Petroleum Corporation (GNPC) lifted 11.8 MMbbls on behalf of the State, encompassing contributions from the Jubilee Field, TEN Field, and SGN Field. Gas production reached 237,962.82 million standard cubic feet (MMscf), with a portion of 88,418.88 MMscf utilized for power generation and non-power gas consumers. The average achieved crude oil price for 2020 was $43.3, representing a decrease from the 2019 price of $63.19. Total petroleum receipts for 2020 amounted to $666.39 million, a decrease compared to the $937.58 million received in 2019. These funds were allocated to various entities, including GNPC, the Annual Budget Funding Amount (ABFA), and the Ghana Petroleum Funds (GPFs).
Key findings – Mining:
The mining and quarrying sector’s contribution to Ghana’s GDP slightly decreased from 7.8 percent in 2019 to 7.6 percent in 2020. Gold production experienced a downturn of 12 percent, dropping from 4.577 million ounces in 2019 to 4.023 million ounces in 2020. Similarly, manganese production by the Ghana Manganese Company (GMC) witnessed a substantial decline of 56 percent, falling from 5.383 million tonnes in 2019 to 2.358 million tonnes in 2020. In contrast, bauxite production exhibited positive growth, increasing from 1.116 million tonnes in 2019 to 1.162 million tonnes in 2020, representing a 4 percent year-on-year rise.
Mineral exports played a significant role in Ghana’s total merchandise export revenue, accounting for 48.4 percent in 2020. Notably, crude oil and cocoa contributed 20.1 percent and 16.1 percent, respectively. The proceeds from mineral exports expanded by 4.8 percent, reaching $6.998bn in 2020 compared to $6.678bn in 2019. The mining sector employed a total of 34,363 individuals, consisting of 8,760 direct employees and 25,603 contractors. Impressively, Ghanaians constituted 98.7 percent of the workforce in large-scale mines, highlighting the sector’s contribution to employment generation.
The launch of Ghana’s 2020 Mining and Oil/Gas EITI reports represents a significant step toward increased transparency and accountability in the country’s extractive industries. By adhering to the EITI Standard and providing comprehensive data, Ghana continues to demonstrate its commitment to sustainable development and responsible resource management.