‘Create independent regulatory body for oil’

25/11/10

Story: Musah Yahaya Jafaru
AN oil consultant, Dr David C. K. Tay, has proposed the establishment of a special regulatory body to govern the operations of the country’s oil companies.
He said the current system whereby the Ghana National Petroleum Corporation (GNPC) doubled as an investor and a regulator in the oil sector would make it difficult for the GNPC to control the operations of its co-investors more efficiently.
Dr Tay, who is a civil engineer, was speaking on the topic: “Offshore Oil Development and Implementation Processes” at a lecture organised by the Ghana Institution of Engineers in Accra on Tuesday.
The one-hour lecture touched on the oil discovery, exploration, infrastructure, management of oil revenue and agreements between oil companies and the government.
Dr Tay indicated that since GNPC had only about 10 per cent share in the oil field, the company with the biggest share would have a better say in the management of the oil.
Therefore, he said, an independent regulatory body which was outside the arrangement would be in the best position to regulate operations of the oil companies.
“It is in the interest of every country that the regulatory authority is independent of the investment,” he said.
Dr Tay proposed the formulation of a local content in the oil industry for the benefit of the local people, pointing out that “the benefit should not only be financial, but there should be technology transfer and provision of jobs for the local people”.
On the prospects of Ghana’s oil, Dr Tay said the country’s oil was one of the largest in Africa with an estimated drilling of 120,000 barrels a day, adding that the country stood the chance of generating huge revenues from the sector.
He commended the government for taking precautionary measures, including agreements for royalties and taxes, and charged the government to stick to the terms of the agreements.