You are here: HomeWallOpinionsArticles2013 03 11Article 267248

Opinions of Monday, 11 March 2013

Columnist: Norvor, Justice Dansu

Who Becomes CEO of our Gas & Oil, Prez. Mahama?

In countries where oil has become a national cake, Parliament makes the laws covering the sector, Ministers of State become the policy making branch enforcing policy of the executive arm while the onus lies on Chief Executive Officers ( CEOs) to strategically implement effective day-to- day systems to ensure how oil and gas are generated and how the revenue is accounted for. In other words, a country’s fate, either good or bad--relative to oil- is often in the hands of a certain CEO, who decides the operations on the ground.
Ghana began large-scale oil production in December 2010 from the Jubilee oil field, one of the largest recent discoveries in West Africa with current production of over 80,000 barrels per day, although the target is about 120,000. Our oil find is projected to become the biggest foreign exchange earner if all goes well, upstaging the gold, cocoa and timber exports that we previously relied on.
It is universally accepted that, any nation that finds oil expects the standard of living of its citizens to jump out of poverty. Most Ghanaians expect that our new-found oil and gas wealth will lead to quality education (Not Free SHS), good roads, well equipped hospitals, better infrastructures, well paid and motivated workforce, etc.
Indeed, Oil and Gas revenue has the power to transform people’s lives for good. Norway, Saudi Arabia and UAE are all classic examples. As awkward as it may sound, that same oil revenue also possesses the power to transform people’s lives for the worst. It can be a source of potential conflict, instability, and curse, especially from the African experience. Hence the so-called Dutch disease. For example, people have been wondering if it would have been better, had Nigeria not found oil, since in fact it has brought more hardship and suffering than blessings. It led to the desecration and destruction of the marshlands and rivers of the Niger Delta, to the neglect of other sectors of the national economy, including manufacturing, agriculture, and to outright conflict (Niger Delta Militancy).
There is nothing to show where the billions of dollars generated in oil revenue for Nigeria has gone to. The height of the misuse of oil revenue in that country is the infamous “ Gulf War Windfall “ of 1990, when Nigeria generated an estimated US$12.4 billion in three months only to disappear into thin air.
On the other hand, Equatorial Guinea sees its President’s son buying luxury villas and cars around the world worth millions of dollars, while the people are wallowing in abject poverty.
Angola, with all its oil has its capital, Luanda, as the most expensive city to live in Africa. The least talked about the militants in Cabinda province, the better for Angola, or for that matter Boko Haram in Nigeria.
Oil therefore has two sides of the same coin: development or conflict.
Amidst the misuse of the country’s resources is the fact that, the business of oil and gas exploration and distribution poses enormous environmental challenges which, if not properly planned and prepared for, could be disastrous; thereby rendering future revenue generated insignificant, compared to the damage.
The revenue centric mindset of Ghanaians permeates every discussion, such that it is given preeminence in virtually every annotations as seen in former Minister of Finance, Kwabena Duffuor’s 2012 budget to parliament “ Total benchmark oil revenue is estimated at 1,239.8milion cedis (768 million dollars, 659 million Euros),” he said.
These and many other commentaries have made the entire country obsessed with the revenue to be generated, so much so that no one cares if the exploration is giving us our just total benefit with regards to employment, local content, economic transformation, creation of new industries, Ghana’s overall competitiveness, etc .
Many have forgotten that the oil is been drilled in our marine environment, which could affect the marine life and fishing industry, a billion dollar industry in itself, if we manage it properly and exploit it to the benefit of the country. How do we address the potential occupational Health, Safety and Environment issues that are core to the oil sector? Already, many coastal communities in the Western region have been complaining of environmental pollution and massive losses of the usual fish catch.
If we are only enthused about the revenue to be generated, how sure are we as Ghanaians that the revenues will be equitably distributed to all sectors of the economy and managed effectively.
It is all these and other fears that I want to appeal to President Mahama to as a matter of exigency appoint competent and proven patriots to head the Gas & Oil industry as Chief Executive Officers (CEOs) of the Ghana National Gas Company (GNGC) and the Ghana National Petroleum Company (GNPC) . We are also aware of frictions between these two organisations and GNPC’s desire to swallow the GNGC.
The President owes it a mandate to Ghanaians to ensure that the appointed CEOs for this critical industry which can make or break our country are of the highest integrity and command the respect and trust of our citizenry.
When one considers the judgment debts and the involvement of some officials in alleged corrupt activities in the previous administrations, the President needs the strength of character and a divine direction to make the best decision in the national interest.
The CEO has responsibilities to provide leadership and relationships management to the Jubilee oil field and controls its accounts, presentation and provision of the entity’s financial information to Ghanaians. More generally, the CEO would be responsible for the day-to-day management of our gas and oil in accordance with the law, with the decisions of the Board and with Government policies.
But, who is fit to take this national responsibility amongst our latter day politicians. I have been exercising my mind on this matter, so chose to consult a number of key people in Government, among the Council of State, MPs as well as NDC regional chairmen for their view. Some names were mentioned in terms of efficient and honest management of this critical national resource. They include: Tsatsu Tsikata, Dr. Ekwo Spio-Garbrah, Dr Kwame Ampofo and Dr Yaw Akoto as well as the incumbents. Tsatsu Tsikata having served previously as CEO of GNPC brings to the job unrivaled technical knowledge of the operations of the Oil Industry and could be of great asset to the nation in the unlikely situation of our foreign partners taking advantage of our obsessions with the revenue at the expense of potential drawbacks. With Tsatsu’s highly respected knowledge of corporate law, we can also be sure that not only would Ghana accrue the expected dividends but also the safety of our local workforce--health and safety –wise- is met, and all other social responsibilities of the companies as stipulated in the concession agreement are adhered to the fullest. But considering previous happenings at the TOR which led to Tsatsu’s prosecution at the Fast Track Court and his subsequent jail terms for causing financial loss to the State, will his appointment signal President Mahama rewarding corruption? Or must we forgive Tsatsu Tsikata and reward him for his competence and expertise? It is left to Ghanaians to judge. One MP said we should take into account the fact that he is currently busy as a lead attorney defending President Mahama at the Supreme Court in the case the NPP’s leadership has brought against the President and the Electoral Commission. Some will argue that he is too busy now, maybe even too senior to return to a mere CEO’s job.
Next, is the outspoken NDC bigwig, Dr. Ekwo- Spio Garbrah, who is a globally accomplished CEO. His experience and expertise in turning institutions into productive entities is globally renowned. Although he seems quiet on politics in recent years, reportedly “working for God” in a church, his untainted patriotism, strong management skills, unique pragmatic and hardnosed approach is all that is needed to harness our Gas & Oil revenue to the blessing that we all seek. A Council of State member who knows his profile reminded me that, Spio- Garbrah has worked as Minister of Mines and Energy in the Rawlings government, so knows the industry. His CV reveals that he even did some energy sector intelligence work for OPEC in the 1980s while working in the USA. As Ambassador to USA, he was known to have been involved in bringing a major energy investor called CMS Energy of Michigan into Ghana to establish the Aboadze Thermal Plant for VRA. He has worked for the World Bank and the African Development Bank, and understands the nuances of international finance and high-level negotiations. He brings a strong business and industry focus to bear. His eight years serving as CEO of no mean an organization as the Commonwealth Telecommunications Organization (CTO) speaks volumes of his competency and integrity. Indeed, a former Cabinet colleague intimated that it was Spio’s defense of the national interest at a Cabinet meeting in the late 1990s that kept Ashanti Goldfields from being sold for cheap, and how Ghana now still retains some shares in the company. President Mahama was in the Cabinet as a minister when it all happened.
Many other Ghanaians remember Dr Spio-Garbrah as an innovator, credited with the creation of the Ghana Education Trust Fund (GETFund), which currently mobilizes over $100 million each year domestically for educational sector infrastructure and student assistance programmes across the country. Spio- Garbrah along with President Mahama then at the Ministry of Communication also created the public awareness and acceptance for the VAT which today mobilizes billions of cedis for socio-economic and infrastructure development of our country. So President Mahama and Spio have worked closely in the past. Spio also has the advantage of being from the Western Region, whose chiefs and leading citizens keep crying out for one of their own to be in charge of this sector—someone they claim they can have easy access to and speak their local language to. .
Other possible candidates for these positions include Dr Yaw Akoto, who was MD of the Tema Oil Refinery under Rawlings and CEO of the Bulk Oil Storage Terminal (BOST) under President Mills. He is said to have been retired last years, rumors claiming that he fell out with his Board Chairman, Huudu Yahaya over some transactions. Dr Akoto’s CV is very technically strong, having graduated from both MIT and Harvard in the USA. But with Alhaji Huudu being related to President Mahama, it is not clear if Dr Akoto can make an easy come back into another high level government post.
Then there is Dr Kwame Ampofo, a former MP who supposedly was persuaded by President Mahama to step down from challenging another candidate at the NDC primaries for the last 2012 elections. This may mean that President Mahama owes him a job. Dr Ampofo was MD at the TOR under President Mills but run into difficulties with Mills’s power brokers at GNPC who also wanted to control his decisions at TOR, according to an insider at NDC headquarters. It is reported that Ampofo refused to play ball with these Mills manipulators, and got kicked out. Are the Mills manipulators still powerful in the Mahama government, as to keep Ampofo out? Or will Mahama put his foot down and find a place for Ampofo?
Of course, the current or recent incumbents in the posts at GNPC and GNGC are also potential appointees. But the President may decide that these positions are now far too strategic to be left in any but the safest of hands. And all Ghanaians are more interested in this sector than ever before.
If the President wishes to choose someone with a high degree of integrity, honesty, experience, broad managerial acumen, and skills in dealing with diverse stakeholders, understanding of the broader policy context of the business of the public entity and a strong business and strategic thinking that defines the effective CEO that Ghana needs, then many I spoke to claim Spio Garbrah best fits the bill. He also commands a high standing in the NDC, the national and international community, hence the public trust is sure. For those of us in the NDC, seeking further unity in the Party, any good appointment for Dr Spio will be a masterstroke by Mahama. Many in the NDC thought President Mahama would appoint Spio to a Cabinet post or make him Chief of Staff, but that has not happened. Some in the media speculated he was going to the Foreign Ministry, but that was not to be, so the President must have some other cards on his sleeves. President Mahama needs a capable individual who could transform our oil and gas revenues into a great asset for our national transformation. Spio’s well-known strict adherence to duty and high ethical standards would also avert any form of infiltration of our shores with criminal cartels to siphon millions of dollars worth of oil to the detriment of our national transformation. The question is can the President persuade Spio from working for God to come help defend the nation again at such a critical time?
In a nutshell, if our oil is not properly managed in the way that protects Ghana’s health, safety and environment, and ensures the equitable utilization of the revenue accrues to the benefit of the citizenry, we may end up with a damaged environment that may require years and millions of dollars to restore as in the Niger Delta of Nigeria, followed by conflicts. We may also suffer a total neglect of other sectors of the economy, thereby leading to a country whose GDP shall be disproportionately dependent on oil and gas. This is a future we cannot countenance; neither do we hope for it.
The good news; however is that, unlike our sisterly country of Nigeria, we still have time on our side to avert any future upheaval that may befall our country just simply because we have oil. For once, let the NDC leadership allow President Mahama to find very capable Chief Executive Officers (CEOs) who will in turn lay the foundation for a judicious use of our oil for the transformation of our beloved country. Let us not allow our narrow self and parochial interest and shortsightedness to get the better of us. Let us look at the bigger picture and greater national interest. Only there and then, shall the oil be a blessing and not curse. Yet again, we are watching.

May God Bless Our Homeland Ghana.

Justice Dansu Norvor