The Ghana National Petroleum Corporation (GNPC) has dismissed reports that a Public Interest and Accountability Committee (PIAC) annual report cited it overspent its 2015 budget.

It was reported that GNPC’s budget allocation for 2015 was a little over $126 million, but the company spent $190,470,000.

However, in a statement released by the Corporation Thursday, it said, “GNPC actually underspent its budget for 2015, approved by Parliament.”

“Our forecasted revenue was $228.05 million and our actual revenue was $126.86 million. This shortfall was driven by the global fall in crude oil prices,” it added.

Comparing its budgeted expenditure of $291.90 million, the Corporation said the actual expenditure of $190.01 million represented a 35 percent underspend.

Below is the statement

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GNPC DID NOT OVERSPEND 2015 BUDGET

Recent news stemming from the PIAC Annual Report alleging that GNPC overspent on its 2015 budget are incorrect.  GNPC actually underspent its budget for 2015, approved by Parliament.

Our forecasted revenue was $228.05m and our actual revenue was $126.86m.  This shortfall was driven by the global fall in crude oil prices. Irrespective of this fall in prices, we were contractually obligated to meet our share of costs in the Jubilee Field.  Meanwhile, compared to our budgeted expenditure of $291.90 million, our actual expenditure of $190.01m represented a 35% underspend.

It is as a result of prudent financial management that we were able to fulfil our contractual obligations despite such a sharp decline in revenue.  This is what enabled GNPC to make critical sector interventions, to ensure the smooth movement of gas to power plants, in order to stabilise the supply of power for industrial and domestic use. 

This includes the provision of road infrastructure in the oil and gas enclave in the Western Region, the guarantee that enabled Karpowership to bring in a power plant to alleviate load shedding, and meeting our obligations as a Joint Venture partner in the Saltpond Offshore Producing Company.

The issues emanating from the Maritime Boundary dispute with Cote D’Ivoire could have a major impact on the entire oil and gas industry in Ghana if the eventual judgement is not in Ghana’s favour. 

Ghana has a strong case at the arbitration and so we have to ensure that we make the necessary representations ensure we secure the expected outcome for Ghana.  The increases in costs are a result of required increased activity in 2015.