In order to avoid a Niger-Delta situation in Ghana

A-G pushes for review of oil & gas laws
… For effective management of resources
Posted: The Chronicle | Wednesday, December 09, 2009

By Charles Takyi - Boadu

Ghana seems to be learning a lot of lessons from neighbouring West-African countries, including Nigeria, which are having a tough time dealing with the challenges presented them by their oil find and exploration.
Though there are existing legal and regulatory frameworks governing the oil industry in the country, the Attorney-General and Minister of Justice, Mrs. Betty Mould-Iddrisu, says the government is striving to modify it.

Speaking at the All Africa Energy Summit, which opened in Accra yesterday, she noted “Ghana must rapidly make the transition from a country competing to attract valid oil and gas investment, into one that is a major producer.”

The transition, according to her, is complex, and must be managed with skill, in order to avoid the pitfalls other countries have suffered.

In order to achieve this, she said the government intends to maximise the country’s revenue from the oil and gas discoveries, effectively manage oil and gas operations to ensure proper development of fields, maximise local content in the industry i.e. the participation of Ghanaians in the revenue associated with the industry, to facilitate job creation and introduce transparency into the nascent industry in Ghana.

Considering the fact that there are many aspects to an effective transition, the Attorney-General says one indispensable component was the establishment of a solid legal framework, to ensure that Ghana’s interests are maximised and fully protected.

She stressed the need for Ghana, as a country, to “approach the industry from a position of legal strength,” laying emphasis on the fact that “we must confront head-on the legal challenges of becoming a major oil and gas producer.”

In the light of this, Mrs. Mould-Iddrisu said, “it is imperative that Ghana’s legal regime, relating to the oil and gas industry, is reviewed and adapted to Ghana’s new condition as a major oil producer.”

This, according to her, might include the need to review and update the Petroleum Exploration and Production law PNDCL 84, issuance of Petroleum Regulations in accordance with PNDCL 84, and also review and update the country’s petroleum taxation and revenue laws.

“The current stabilisation clauses may also have to be looked at again, since they are too broad, and were incorporated at a time when Ghana did not know its oil and gas potential,” she indicated.

She however noted that the government had already begun the review of the regulatory framework, indicating, “the Ministry of Energy has drafted a local content policy and proposals on various regulations, which are in the process of being referred to the Ministry of Justice for drafting.”

The Attorney-General and Minister of Justice also talked about a new oil and gas revenue bill, which seeks to manage revenue from the oil and gas industry, and ensure transparency, stressing, “the oil and gas tax law has been reviewed and incorporated in the general income tax law.”

Meanwhile, she said there were proposals for the formation of an independent regulator, which, according to her, are being made ready for preparation into a bill, and it is expected that most, if not all, of the proposed review legislation, would be ready by the production date in 2010.

According to her, the amendment expands the responsibility for the regulation of activities in the Petroleum Up and Mid Stream sub-sectors.

The objective of these amendments, she said, was to regulate, oversee and monitor activities in the upstream, midstream and downstream petroleum sector, and support the national policy objectives of the up, mid, and downstream petroleum sector.

Whilst admitting that Ghana had not been given much time to prepare for the transition, the A-G said, “we are determined to make our oil find a blessing, and not a curse, by putting the appropriate legal and regulatory structures in place, to ensure that Ghana gets the most out of its oil and gas reserves, and runs an industry that is transparent and best-practices oriented.”

Available information has it that the PNDC Law 64 established the Ghana National Petroleum Corporation, and makes it responsible for the development and production and disposal of oil and gas.

PNDCL 84 provides a framework for the management of oil and gas exploration development and production, and makes it clear that all petroleum existing in its natural state, is the property of Ghana, and also that the exploration, development and production of petroleum, shall be done only in accordance with the terms of a petroleum agreement that is regulated and executed with the Minister of Energy, and the interest acquired cannot be assigned to any other person, without the prior consent in writing of the Minister of Energy.

Mrs. Betty Mould-Iddrisu believes this is essential, because the rights to petroleum products in its natural state is the property of the people of Ghana vested in the government, since the law provides the basic terms of every petroleum agreement.

It also spells out the rights and objectives of the parties, and the sanctions to be applied in case of breaches.

Section 32 of the Act provides for regulations to be made in 24 areas of oil and gas management, unfortunately, since 1982 most of them have not been made.

CONFUSION ERUPTS @ GCB

… As gov’t galls board over appointment of new MD
Posted: The Chronicle | Tuesday, December 08, 2009

By Charles Takyi Boadu

Credible information reaching The Chronicle indicates that powerbrokers and influence peddlers close to the Presidency, are putting excessive pressure on the government to hand-pick the Managing Director (MD) of Stanbic Bank, Mr. Alhassan Andani, for the position of Managing Director of the nation’s biggest bank, the Ghana Commercial Bank (GCB), to succeed Lawrence Adu Mante.
A source close to the interviewing panel set up by the Council of State, led by Professor Kofi Awoonor, has confided in The Chronicle that among the three individuals shortlisted out of the seven applicants interviewed, Mr. Andani scored the least points in their grading.

The shortlisted three are Mr. Alhassan Andani of Stanbic Bank, Charles Asare of Ecobank Development Corporation, and Simon Dornoo of Barclays Bank. The paper learnt that Mr. John Kofi Mensah, the Deputy MD of Unibank, was earlier picked by the board to succeed the outgoing MD, but the government’s intervention halted his elevation with the excuse that the interviewing process had not been completed.

The board Chairman and experienced banker, Kojo Thompson of SG-SSB fame, refused to comment on the story when this reporter contacted him on phone. Workers at GCB however consider the maneuverings of the government, as an attempt to usurp and undermine the authority of its board.

It is also said that the government wants to pacify Mr. Andani for not being given the position of Governor of the Central Bank (Bank of Ghana), as well as the top post at the Agricultural Development Bank, when they became vacant.

In the wake of the search for a person to succeed the Governor of the Bank of Ghana, Dr. Paul Acquah, media speculations bandied the name of Mr. Andani as the government’s choice for the enviable position.

Then out of the blue, came K. B. Amissah-Arthur, a guru in Statistical Economics, to grab the position.

Meanwhile, credible sources at the GCB say its staff is unhappy about the way and manner in which the government is bent on imposing Mr. Andani on their bank, and are kicking heels ready to protest.

The GCB, they are quoted as saying, has a myriad of managerial problems that need a seasoned banker to handle.

The Ghana Commercial Bank is the biggest bank adjudged by total assets, loans and advanced and shareholders’ fund, and came on a close second by deposits at end of 2008.

It recently opened its 153rd branch at Nima, a sprawling suburb of Accra.

The GCB has a 12-member board, with Mr. Kojo Thompson as Chairman, Mr. Lawrence Adu-Mante, Managing Director, Mr. Samuel Sarpong, Deputy Managing Director In-Charge of Operations, and Mr. Samuel Amankwah, Deputy Managing Director In-Charge of Finance

Others include Mr. Fiifi Kwetey (Non-Executive Director), Mr. Lovelace Prempeh (Non-Executive Director), Mr. Samuel Amankwah (Deputy Managing Director - Finance), Dr. Fritz Gokel (Non-Executive Director), Mrs. Charlotte Osei (Non- Executive Director), with Mrs. Adelaide Mary Benneh, Mr. Joshua K. Peprah, Ms. Lauretta Vivian Lamptey and Mr. Elliot Gordor as members.

In a related development, a Ghanaian resident in the heart of the United Kingdom, London, one Phillip Kobina Baidoo Jnr., has suggested the privitisation of GCB.

In his widely circulated feature article titled ‘Ghana Commercial Bank, the elephant in the living room,’ he wrote, “Though I know that the word privatisation is an anathema to a lot of Ghanaian intellectuals that is what I will shout from the rooftops.”

According to him, most people think that the GCB is a private enterprise, but it is a de facto State-Owned Enterprise (SOE), because the government owns 21.36% and SSNIT, which is a government organisation, 29.81%, summing up to 51.17% of GCB’s operations.

“You therefore can see who calls the tune at the stockholders meeting. Ghana Commercial Bank should be fully privatised. For those who think privatisation is bad, I will assure them that there is no better option,” he noted.

He believes privatisation is just like democracy, which Winston Churchill satirically defined as the worst form of government, except for all those others that have been tried.

“The only way we can get the best out of the nation’s resources we have invested into this company, is a complete privatisation of the bank,” he reiterated. In the final analysis, Phillip Kobina Baidoo Jnr. said it was when the management becomes answerable to irate stockholders, who will always demand their pound of flesh, that those at the helm of affairs will sit up to do the right thing.

CIVIL SERVANTS BATTLE GOV`T

…Over Single Spine Pay Policy
…Calls for immediate review
Posted: The Chronicle | Thursday, December 03, 2009

By Charles Takyi - Boadu

The Civil and Local Government Association - Ghana (CLOGSAG), have started raising issues with the Single Spine Pay Policy (SSPP) which is set to take off in January next year. The group claims that its recommendations were not incorporated into the final report, which led to the issuance of a white paper on the policy by the government.

At a press conference in Accra yesterday, Vice President of the Association, Tennyson Foli said they realized certain anomalies in the policy document, as a result of which they made recommendations for changes to be made into issues, including the entry point of University graduates into the Civil Service.

The Association claimed that though government promised to incorporate their concerns into the policy document at a stakeholder’s forum at the Ghana Institute of Management and Public Administration (GIMPA) in Accra, it failed to do so in the final report.

The Vice President of the Association raised issues with certain provisions in the policy document which discriminate against University graduates who enter the Civil Service.

According to him, these graduates are graded lower that their colleagues in other sectors of the economy, though they have the same qualification.

Mr. Foli also talked about the situation where Directors working in the capital city are paid higher salaries than their colleagues in the regional capital. These, according to him, are some of the anomalies that government has failed to rectify.

In its present state, the association said it would not accept the Single Spine Pay Policy since it does not address their concerns.

Meanwhile, the technical committee of the Association has reconvened to examine the white paper, whilst the national executive committee is scheduled to meet from 10th-12th December 2009, to take a firm decision on the issue.

It has thus enjoined all members of CLOGSAG to remain calm and continue to have confidence in the executives, since they were ready to fight their cause whilst assuring them that “the Association shall not accept any policy that will disadvantage them.”

A government statement issued on Thursday November 26, 2009, and signed by Information Minister Zita Okaikoi, said the Single Spine Pay Policy has been given Executive approval of the President, John Atta Mills.

The White Paper confirmed government’s promise to commence the implementation of the policy from January 2010.

Mrs. Zita Okaikoi explained that the White Paper details government’s plans for the implementation of the new pay policy for the Public Services, which aims at addressing disparities, distortions and restoring equity in the pay structure. “The implementation would, however, be in phases over a five-year period starting from January. Because we noted that there are some outstanding issues, the White Paper gives a six-month period, during which challenges would be tackled” the Minister said.

Furthermore, the Information Minister noted that the issuance of the White Paper and scheduled commencement of the policy in January next year further demonstrate government’s commitment to the welfare of the worker and “an affirmation of the communiqué adopted at the May 2009 Consultative workshop at GIMPA.”

Government stated that it was looking forward to equity and fairness in the country’s pay arrangement as it works with all the social partners in the implementation process.