US$100.7 million oil revenues: GNPC disagrees with PIAC and absolves Finance Minister of wrongdoing

The Public Interest and Accountability Committee (PIAC) and the Ghana National Petroleum Corporation (GNPC) have expressed divergent views on the account into which petroleum revenue of $100.7 million should be paid.

While PIAC insists it should be paid into the Petroleum Holding Fund, the GNPC says it should be paid into Jubilee Oil Holding Limited, a subsidiary of the corporation.

Lifting of oil

The amount was realised from the lifting of 944,164 barrels of oil from the Jubilee fields and Anadarko CWTP Company in the first half of 2022.

Testifying as a witness before the ad hoc committee of Parliament hearing the censure motion on the Minister of Finance yesterday, the Vice-Chairman of PIAC, Nasir Alfa Mohammed, said the money was rather paid into an offshore account.

“We have established that they have not paid that quantum of money, which ought to have formed part of the petroleum revenues of Ghana, into the Petroleum Holding Fund, and in our view that is contrary to the law,” he told the committee.

However, the GNPC said PIAC got it all wrong.

The Deputy Chief Executive (CEO) of the GNPC in charge of Commerce, Strategy and Business Development, Joseph Dadzie, who also testified as a witness before the committee, said the money was paid into Jubilee Oil Holding Limited, which was legally clothed with the authority to receive the money.

He, therefore, disagreed with PIAC that the money should have been paid directly into the Petroleum Holding Fund.

Both witnesses were testifying in response to the proponents of the censure motion against Ken Ofori-Atta on the ground of illegal payment of revenues into an offshore account, in flagrant violation of Article 176 of the Constitution.


Answering questions from members of the committee, Mr Nasir said the proceeds were accrued from the seven per cent interest the GNPC acquired from the Jubilee Fields and Anadarko Company assets for $119 million on April 1, 2021.

He said the failure to lodge the amount in the Petroleum Holding Fund breached Section 6 of the Petroleum Revenue Management Act, 2011 (Act 815) and Section 7 of the Petroleum Revenue Management (Amendment) Act, 2015 (Act 893).

Both acts 815 and 893, he explained, state that revenues accruing to the state from the direct or indirect participation of the state in petroleum operations shall first be paid into the Petroleum Holding Fund.

Losing legitimate revenues

Emphasising that the money ought to have been deposited in the Petroleum Holding Fund and not in any other account, Mr Nasir said: “Our consideration is that if that money does not come to the Petroleum Holding Fund, the state will be denied legitimate revenue from petroleum.”

“Our position, as a committee, is that lifting, whether it is lifted by 100 per cent of GNPC or not, ought to come first into the Petroleum Holding Fund from where disbursement can be made for whatever reason,” he added.

The witness indicated that in its annual report from January to December 29021, PIAC reported that in line with the GNPC strategy to increase its stake in viable oil blocks, it acquired a seven per cent interest from Occidental Petroleum from Anadarko Company in respect of the company’s deepwater Tano Cape Three Points assets for $119 million, effective April 1, 2021.

He said the acquisition, which was to be transferred to the GNPC’s subsidiary, Explorco, translated to 5.95 and six per cent production interest in the Jubilee and the TEN fields, respectively, for the GNPC.

Explaining further, the witness said 100 per cent of acquisition was later ceded to Jubilee Oil Holding Limited, which made its first oil lifting of 944,164 barrels of oil in the Jubilee Field in the first half of 2022.

With $100.7 million being realised from the sale of the crude oil, he said, the revenue was not paid into the Petroleum Holding Fund, as required by law.

“Mr Chairman, it was the consideration of the committee that contrary to Section 6 (e) of Act 815, capital gains tax was not assessed and collected by the Ghana Revenue Authority in the sale of the seven per cent interest by Anadarko Company in the Jubilee and the TEN fields in 2021.

“We wrote to both the GRA and the Ministry of Finance for responses on these issues, and in its written response to PIAC on the matter, the GRA referred the committee to the Ministry of Finance, indicating that the ministry was exclusively in charge of the transaction,” Mr Nasir said.

He said the Ministry of Finance, in turn, referred the committee to the GRA for answers.

He said for the purposes of disclosure, the GNPC referred the committee to an advice by the Attorney-General’s Department purporting to okay the transaction in the nature and manner the GNPC dealt with it.

“Mr Chairman, we are happy to say that we did not come to this conclusion without recourse to that advice,” he added.

Set up

When he appeared before the committee, the GNPC Deputy CEO said it was not the GNPC that set up Jubilee Oil Holding Limited but rather Anadarko Company.

He said Jubilee Oil Holding Limited was set up because Anadarko decided to sell its stakes in the Ghana assets and reached an agreement with Kosmos to purchase it.

The Ghana government, he said, then made a submission that it wanted part of that stake, and after negotiations, “we agreed on seven per cent”.

With strict timeliness for the consummation of that transaction and the need for the GNPC to go through the approval process, Mr Dadzie said, Anadarko decided to sell Jubilee Oil Holding Limited, carving out the seven per cent for the GNPC to acquire later on.

“We got the necessary approvals and we were ready to buy Jubilee Oil Holding Limited, so the structure of the transaction was not a GNPC-defined structure but that of the seller (Anadarko Company).

“We did not buy a participating stake; we rather bought the company which held seven per cent in Jubilee and TEN,” he said.


On where GNPC got the funds to buy Jubilee Oil Holding Limited, Mr Dadzie said the corporation wrote to the Ministry of Finance to advance it a loan towards the purchase and obtained approval from the ministers of Energy and Finance.

On the quantity of oil lifted by Jubilee Oil Holding Limited so far, he said: “We have lifted in total $153 million.”

“Jubilee Oil Holding Limited is a 100 per cent subsidiary of the GNPC and we believe it is a company registered under the Companies Act and obviously the terms and conditions, as well as the constitution of Jubilee Oil Holding Limited, are governed by that act, not the Petroleum Revenue Management Act.

“For that reason, 100 per cent of that revenue cannot be paid into the Petroleum Holding Fund. Jubilee Oil Holding Limited must operate, and if at the end of the day it declares profit and the directors decide dividends must be paid, that money is paid to the GNPC, which will pay it into the Petroleum Holding Fund,” Mr Dadzie said.

Finance Minister not wrong

Responding to a question on which of the allegations related to the Finance Minister, he said: “As far as Jubilee Oil Holding Limited is concerned, the Finance Minister is not responsible for the revenues.”

“Obviously, we have to, at the end of the day, submit our financials and pay whatever asset tax there is to the GRA. In 2021, Jubilee Oil Holding Limited paid GH¢17 million to the GRA as tax on its operations.

“So, as far as revenue is concerned, I do not think the Finance Minister has any direct control over revenue,” he declared.

Asked if the $100 million was paid into an offshore account, Mr Dadzie said: “Yes, it was paid into an account at the Ghana International Bank in London by the buyers of the crude.”