The Ghana National Petroleum Corporation (GNPC) risks losing in excess of $1 billion in anticipated capital expenditure (capex) to the nation’s oil and gas industry over the next decade.
This is according to Patrick Heller, advisor to the Natural Resource Governance Institute (NRGI).
The possible loss of the $1 billion capex which forms a quarter of total anticipated expenditure in the industry, Mr Heller asserts, will be on the attainment of climate change goals contained in the 2015 Paris Agreement as the GNPC will fail to break-even on investments made in the sector.
This will not be peculiar to GNPC as a report by the NRGI estimate that state-owned oil companies around the world risk losing some $400 billion in investments in the oil and gas sector as countries around the world transition to much cleaner sources of energy in a bid to combat climate change.
Already big oil majors like Eni, BP, Total and Shell, have all written-down their assets worth billions of dollars in a bid to transition to cleaner forms of energy other than fossil fuel.
Speaking at the virtual national dialogue on extractive governance themed; Towards a Sustainable Future for Extractive Governance in Ghana – Interrogating Past Reforms for Exploring New Policy Directions, Mr Heller remarked that Ghana needs to revise its ambition of increasing upstream operatorship in light of the looming financial risks in the sector.
He also advised that the GNPC consider entering into new lines of business to diversify the company’s profile.