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Ghana’s stagnant Oil sector: Gov’t Must Act Fast
(From a very significant article by an expert oil &gas Industry watcher, some takeaways in brief) When industry players in Ghana’s energy sector recently gathered under the guidance of the Public Interest and Accountability Committee (PIAC), the stunted nature of the country’s oil production dominated the conversation. The nation’s crude oil output has been steadily falling since its peak in 2019 when production hit 71.4 million barrels. Fast forward to 2023, and that number dropped to 48.25 million barrels—an annual average decline of close to 10%.
Dr.G.R.Balakrishnan Oct 23 2024 Marine News (Oil and Gas)

Ghana’s stagnant Oil sector: Gov’t Must Act Fast

This decline, while troubling, is not entirely unexpected. With no new fields coming on-stream since this peak, output from the sector has been challenged. The Jubilee field, Ghana’s first major offshore oil discovery, is in the 14th year of its expected 25-year production cycle and is now approaching its natural decline.

Despite Jubilee, TEN and Sankofa, contributing 100% of Ghana’s current total oil production, the outlook for the sector must concern every well-meaning Ghanaian. If action isn’t taken soon, the country’s once-burgeoning oil industry will be short-lived. It’s a situation that calls for immediate intervention by all sector players, led by government, and strong leadership to reverse the trend.

Ghana’s oil sector is at a crossroads…One of the biggest concerns for potential investors in Ghana is the lack of regulatory predictability. International Oil Companies (IOCs) have voiced frustration over issues like contract sanctity and fiscal instability, both of which make it difficult to commit to capital-intensive, long-term projects…The simple fact remains: the quickest way to enhance the growth of Ghana’s oil and gas industry is through renewed investments. With the right incentives and a stable regulatory environment, there’s no doubt that Ghana can regain its position as a key player in sub-Saharan Africa. After all, as it is oft said, “money goes where it is welcome.”

The development of well-established gas infrastructure will fast-track Ghana’s energy security by taking advantage of the vast amount of gas within the nation’s basins and make gas a transition fuel to boost the economy…The path forward is clear without doubt: fast, decisive action by the government to create an investment-friendly environment that also honours existing agreements. This will stabilize production and position Ghana as a major oil and gas hub in Africa for years to come.

In this moment, the clock is ticking. It’s time for the government to act—before the industry collapses. Ghana’s energy future depends on it.