Former Chairman of Parliament’s Mines and Energy Committee, Samuel Atta Akyea, has shed light on Ghana’s declining petroleum production.

He points to a dispute between Tullow Oil Ghana and the Ghana Revenue Authority (GRA) as a significant factor.

Speaking on JoyNews PM Express on Wednesday, Mr Atta Akyea disclosed that he attempted to mediate the issue but received limited support, calling the GRA’s approach a “bad signal” for Ghana’s energy sector.

According to him, the petroleum industry requires significant investment, and he urged for a policy framework that would protect and encourage such investments.

He argued that the dispute with Tullow, one of Ghana’s key petroleum operators, sent a negative message to global investors, worsening the country’s economic challenges as production dwindles.

“When I became Chair of the Mines and Energy Committee, I saw firsthand that this conflict with Tullow was not beneficial to the nation,” he stated. “In an era where global players are shifting away from fossil fuels, we should work with those still willing to invest. Instead, local disputes over tax matters are driving them away.”

Atta Akyea criticised the decision to “fight one of the remaining giants” in the industry, warning that it could deter future investment.

He urged for a more collaborative approach with petroleum companies to stabilize Ghana’s declining production and mitigate its economic impact.

“I thought with the greatest of respect, when I became the Chair of the energy of mines committee and I had a presentation from Tullow that what is going on is not good for the nation, I went very far with the matter that, I went very far with the matter.

I did not see why. I mean, given the fact that even the players are now on the whole world stage, they are leaving the fossil fuel arena because of the future of the energy transition.

And then if you have a few ones who want to take risks, and there are local issues, not issues of technology, and the rest of it about taxes, it cannot be resolved.

I have also stated I don't support the arrangement that let's give some fight to Tullow in relation to the revenue they want to rake in…So the scenario of going to fight one of the remaining giants in the petroleum was a bad signal for Ghana.”

Background

The dispute between Tullow Oil Ghana and the Ghana Revenue Authority centers on disagreements regarding tax obligations and revenue assessments. Tullow Oil, a UK-based oil company, has been a key player in Ghana’s petroleum sector since it began producing oil in the Jubilee Field in 2010. Over the years, Tullow Oil has become one of Ghana’s major contributors to the national economy, leading exploration and production efforts in the region. However, its tax and operational relationship with the GRA has encountered challenges.

The contention began when the GRA assessed Tullow Oil with significant tax liabilities, reportedly due to differences in how revenue and tax obligations were calculated. Disputes have arisen around capital allowances, expenses, and tax exemptions, with Tullow Oil contesting some of the GRA’s assessments, arguing that they do not align with the initial agreements and licenses granted by the Ghanaian government.

This conflict has escalated to a point where it has reportedly affected Tullow’s operations and future investment plans. The company has expressed concerns over the unpredictability of Ghana’s regulatory environment, emphasizing the need for clarity in tax and investment policies to maintain investor confidence.