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Fiscal Challenges Ghana's oil revenue takes 56% dip

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Oil revenues accruing to Ghana have taking a 56.2 per cent year-on-year dip.

This has been blamed on the excess supply of oil on the international market, pushing prices to dip. here are other major concerns over the other fields like the Saltpond Offshore Oilfied, which according to Pulse Business sources have not contributed any revenue the whole of 2015. And  figures available to us reveal 2015 as the worst year for oil receipts in  Ghana  since country started commercial oil production.

Bank of Ghana puts total revenue accruing to government coffers for 2015 at $341 million. This the Central Bank says represents a 430 million reduction from 2014's total.

Not only did revenues reduce in 2015, technical challenges at the Jubilee Field have resulted in drop in  total production in the by over 1.5 million barrels for the first 9 months of the year compared to the same period int  2014.

Read more: > Money issues Govt hot over falling oil prices; projects to suffer

As the challenges with the gas compressors in of the FPSO have been resolved, daily oil production is supposed to increase to the daily average of 102,000 barrels.

The average price at which the Ghana Group liftings were sold for the first nine months was US$55,296. This compares unfavourably with the revised Benchmark Revenue price of US$57 per barrel, marking the first time the achieved price has fallen below the projected price since petroleum revenue accounting began in Ghana.

Finance Minister Seth Terkper says the under- performance of petroleum revenues for the year stemmed from the rapid decline in crude oil prices and rigid nature of the Benchmark Revenue (BR) estimation, using the formula set out in the Petroleum Revenue Management Act (PRMA) which did not allow for a revision to the BR once estimated.

Read more: > Oil prices Govt to maintain temporary taxes as revenue situation worsens

However, with the amendment to the PRMA, the BR price was revised from $99.38 per barrel set in the 2015 budget to $57 per barrel in the 2015 Mid-Year Review.

Ghana joined the league of oil producing countries in December 2010, when the country began production of crude oil in commercial quantities.

Since the first lifting of oil from the Jubilee Field offshore Cape Three Points, this year is the first time that the price at which the Ghana Group sold its liftings from the Jubilee Oilfield has fallen short of expectation.

The slump in oil revenue this year forced the Finance Minister to cut government's spending by GHC1.5bilIion in a paper presented to Parliament in March this year.

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