Ghana’s domestic petroleum revenue experienced a sharp decline of 62.63% in the second half of 2024, dropping from US$840.77 million in the first half to US$517 million, according to the latest Bank of Ghana (BoG) Petroleum Funds Report.
This significant reduction in revenue has raised concerns about the sustainability of the country’s oil sector and its implications for the national economy. According to the BoG report, several factors contributed to the total revenue figure.
“[A notable] US$369 million came from five crude oil liftings between July and October, sourced from the Jubilee, TEN, and Sankofa Gye Nyame fields, which are Ghana’s primary oil production sites.”
Bank of Ghana (BoG) Petroleum Funds Report
Additionally, the government received US$144 million in corporate taxes from sector players, US$74,000 in surface rental fees from Planet One Oil and Gas Limited, and US$3.67 million in accrued interest from the Petroleum Holding Fund.
These inflows helped push total receipts past the half-billion-dollar mark, despite the overall downturn.
Out of the US$454 million allocated to the Ghana Petroleum Funds, a significant portion went into the country’s two key sovereign funds: the Ghana Heritage Fund (GHF) and the Ghana Stabilisation Fund.
The GHF, which is dedicated to saving wealth for future generations, received US$136.2 million, while the Stabilisation Fund, aimed at cushioning the economy against fluctuations in oil prices, was allocated US$317.8 million.
Payments from companies like Kosmos Energy Ghana, Petro SA Ghana, and Tullow Ghana Ltd were recorded but were lower than expected due to reduced production volumes and fluctuating oil prices
These minor revenue streams remained relatively stable but could not compensate for the broader decline in oil revenue.
The report also highlighted that total lodgments into the Petroleum Holding Fund showed a notable increase when compared to the first half of 2023.
The funds saw a 55.6% rise, with US$840.77 million lodged in the first half of 2024, up from US$540.4 million in 2023. This improvement in early 2024 revenue was largely driven by higher oil prices and an increase in production levels earlier in the year.
However, this positive trend has since been overshadowed by a sharp decline in the latter half of 2024, raising concerns over the sustainability of these gains.
Calls for Immediate Action
In response to these challenges, the PIAC has urged the government to prioritize actions to reverse the decline in production from existing fields and accelerate investments in unexploited reserves.
Regulatory reforms are also considered necessary to attract fresh capital and enhance the competitiveness of Ghana’s oil and gas sector.
Experts believe that by revitalizing production from existing fields and exploring untapped reserves, the country can bolster its petroleum output and secure the future of the sector.
The Bank of Ghana’s Petroleum Funds Report confirms that Ghana’s domestic petroleum revenue fell by 62.63% in the second half of 2024, from US$840.77 million in the first half to US$517 million.
This sharp decline was driven by global oil price fluctuations, reduced production volumes, operational challenges, and lower corporate tax payments.
While the revenue drop poses fiscal challenges, ongoing government initiatives aim to stabilize the economy, diversify revenue sources, and strengthen petroleum revenue management.
Moving forward, sustained efforts to enhance oil production, improve revenue collection, and promote economic diversification will be critical in mitigating the impact of such fluctuations on Ghana’s economy.
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