ACCRA, March 11(Xinhua) -- Ghana expects 581 million U.S. dollars in petroleum revenues this year, an official disclosed here on Monday.
Director of the Real Sector Division of the Ministry of Finance Idrissu Alhassan told the media that the projections were based on a seven-year moving average, as mandated by the country's Petroleum Revenue Management Act (PRMA).
The calculation had pegged the estimated average crude oil price at 94.36 dollars per barrel, while the estimated production of oil is also projected to be 83.341 barrels of oil per day (bopd) , based on a three-year moving average.
Currently the Jubilee field produces about 115 bopd as additional work on the oil wells started yielding positive results in the last quarter of 2012.
Ghana earns five percent of royalties, a carried interest of 10 percent, an additional or paying interest of 3.75 percent and, petroleum income tax of 35 percent, while additional oil entitlement and also comes to the government, with the law allowing the International Oil Companies (IOCs) full cost recovery.
Alhassan said the expected revenue would be spent on four key areas of: Expenditure and Amortization of Loans for Oil and Gas Infrastructure; Road and Other Infrastructure; Agricultural Modernization; and Capacity Building (including Oil and Gas).
These funds by the PRMA are divided into four different accounts of Annual Budget Finding Accounts (ABFA), Ghana Petroleum Funds (GPF) Ghana Stabilization Fund (GSF) and the Ghana Heritage Fund (GHF).
The ABFA is spent in the annual budget; the GPF is made available to the Ghana National Petroleum Corporation (GNPC) for its exploratory activities, while the heritage fund is a saving for the future with the Stabilization fund meant for balancing the budget in years of low oil yield.
The director explained to Xinhua later in an interview that the projection formula was arrived at taking into account the volatility of the world market price for crude as well as the nature fluctuation nature of oil production figures.
"When the production and/or world market price for crude drop(s) in a particular year, resources from the stabilization fund would be used to top up the provisions in the budget, but in years of windfall also, the additional revenue would be lodged in both the Stabilization Fund and Heritage Fund," Alhassan explained.
While Ghana received a total of 444.12 million dollars in oil revenues in 2011, the first full year of oil production, the figure rose to 541.07 million dollars in 2012.
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