Competition heightens amongst African producers as global demand slumps
By Joseph Ojumu
Nigeria’s West African rivals, Ghana, on Thursday beat Africa’s largest petroleum producer in the race to strengthen and improve the legal environment governing exploration and production of the crucial fossil fuel.
This came as Ghana’s legislature gave its final nod to the nation’s Petroleum Production and Exploration Bill at a session in Parliament.
Though the law, which will regulate the nation’s oil sector, is coming nine years after Ghana discovered oil but it is still a regional triumph for the former Gold Coast.
Commenting on the development after the House had approved the Bill, Energy Minister, Emmanuel Kofi Armah Buah, says even though the PNDC Law 84 which regulated the industry has been helpful, the new phase the nation has entered in terms of oil production requires a legal regime that is tighter and more in tune with international standards and best practices.
He explained that the new law is expected to address key issues within the oil sector in areas such as the protection of the environment, local content and capacity building.
He also noted the law has a transparency provision which will ensure that activities undertaken in the sector are open and fair.
This, he believes will attract more investment into the industry and encourage multinational corporations to do business with the country.
He was hopeful that the law will send a clear message to the international community that Ghana is open for business and determined to make Ghana the hub for oil production in the sub-region.
Similar efforts to pass a petroleum Industry Bill, PIB in Nigeria have suffered through three parliamentary regimes and as at now, very little has still been achieved in that regard.
The new development is likely to expand cometition levels amongst African oil producers for dwindling market share as more and more nations either discover deposits of their own or traditional buyers switch their allegiances to newer markets and even alternative products, analysts say. Earlier this week for example, Costa Rica declared that it had now achieved 100 per cent self-sufficiency in the use of renewable energy.
Meanwhile, the energy market in Africa’s largest economy is in the view of many observers, now at an all-time low with almost no new exploration and production deals signed in the past decade even as the country has lost its status of being Africa’s largest oil producer to Angola.