The Auditor-General’s report has revealed that the Ghana National Petroleum Corporation (GNPC) paid GH¢4.9 million for a project in 2024 that was not approved by Parliament.

According to the report, while this unapproved project progressed, several other projects that had received parliamentary approval stalled due to lack of funding.

Additionally, the report highlighted that GNPC committed various procurement breaches, failing to comply with both the Public Procurement Act and its own internal procurement policies.

These findings are contained in the Performance Audit Report of the Auditor-General on the Utilisation of GNPC's Share of Petroleum Revenue on Infrastructure Projects.

“We carried out the audit from January to May 2024 and covered the period 2018–2023 to assess how GNPC planned, budgeted, procured, monitored, and supervised projects, and ensured that they served their intended purposes,” the report stated.

The Auditor-General noted that:

“GNPC paid GH¢4.9 million for a project that was not approved by Parliament. The project progressed, while the approved ones had stalled due to a lack of funding. GNPC was also involved in procurement breaches for failure to adhere to the Public Procurement Act as well as their internal policy on procurement.”

The report also revealed delays in project completion, largely due to the late release of funds, which led contractors to abandon project sites. In several cases, poor supervision resulted in projects not being constructed according to approved specifications.

“In addition, the GNPC Foundation used about GH¢2 million to execute projects that have since been left to deteriorate due to the absence of essential ancillary facilities needed to make them operational,” the report noted.

Between 2018 and 2023, GNPC received a total of US$1.6 billion from petroleum revenues and spent US$768.35 million on Level B activities, including administrative expenses, capital investments, and corporate social investment (CSI) projects.

However, rising public concerns over the high costs and delays associated with these administrative and CSI projects prompted the Auditor-General, under Sections 13(e) and 16 of the Audit Service Act, 2000 (Act 584), to commission a performance audit.

As part of the process, the audit team reviewed project documents and conducted interviews with GNPC officials, contractors, consultants, and project beneficiaries to understand how projects were selected, planned, and implemented.

Thirty-one (31) out of sixty-two (62) projects executed during the audit period, by the GNPC Head Office, CSI Department, and GNPC Foundation, were sampled for inspection.

The AG further reviewed the relevant documentation of these projects to assess their existence, level of completion, usage, and compliance with specifications.

The Auditor General found the following:

1. GNPC paid GH¢4.9million for the Royal Golf Club House, which was not part of the projects approved by Parliament. This project was progressing whilst the approved projects had stalled due to a lack of funding.

2. Again, while the GNPC Head Office did not provide the right justification for the use of the restricted tendering method, its CSI Department and the Foundation failed to comply with the Public Procurement Act (PPA) as well as their own procurement policy in procuring contractors/suppliers for their projects.

3. We further found that the CSI Department delayed the completion of projects due to the late release of funds, which led to contractors abandoning project sites.

4. We noted in addition that projects were not supervised to ensure that they were executed to specifications. The projects were either not constructed to the approved dimensions or provided with the specified items.

5. Furthermore, the GNPC Foundation used GH¢2,000,922.78 to execute projects which had been left to deteriorate due to the absence of ancillary facilities needed to make them operational.

The Petroleum Revenue Management Act, 2011 (Act 815) as amended by the Act 893 (Amendment) Act, 2015, provide a framework for the collection, allocation, and management of petroleum revenue.

Per the Act, Ghana National Petroleum Corporation (GNPC) receives two streams of petroleum revenue for: (i) equity financing (Level A); and (ii) Level B, which is for exploration, development, and other related activities, including corporate social responsibilities.

SSD/MA

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