Ghana’s Petroleum Revenue: A Sharp Decline in 2024 Amid Record Annual Earnings
A Mixed Year for Ghana’s Petroleum Revenue
Ghana’s petroleum sector experienced a rollercoaster year in 2024. While the second half of the year saw a sharp 62.63% decline in domestic petroleum revenue—dropping to US517 million fromUS840.77 million—the annual revenue reached a record-breaking US$1.3 trillion. This marked the highest earnings since oil production began in 2011, according to the Bank of Ghana’s (BoG) Petroleum Funds Report.
This article explores the factors behind this decline, the sources of revenue, and the implications for Ghana’s economy.
Key Revenue Sources in 2024
The BoG report, covering up to December 31, 2024, highlighted several key revenue streams:
- Crude Oil Liftings: US$369 million from five liftings between July and October from the Jubilee, TEN, and Sankofa Gye Nyame (SGN) fields.
- Corporate Taxes: US$144 million from oil sector companies.
- Surface Rental Fees: US$74,000 from Planet One Oil and Gas Limited.
- Accrued Interest: US$3.67 million from the Petroleum Holding Fund.
Despite the decline in the latter half of the year, these contributions helped push annual revenue to unprecedented levels.
For more insights on Ghana’s oil sector, visit Ghana National Petroleum Corporation.
Allocation of Petroleum Funds
Out of the US$454 million allocated to the Ghana Petroleum Funds:
- Ghana Heritage Fund (GHF): US$136.2 million was invested to preserve wealth for future generations.
- Ghana Stabilisation Fund: US$317.8 million was allocated to cushion the economy against oil price volatility.
These allocations reflect Ghana’s commitment to long-term economic stability and intergenerational equity.
Declining Oil Production: A Growing Concern
Despite the record annual revenue, oil production continued its downward trend in 2024. This decline raises concerns about the sustainability of Ghana’s oil sector and its ability to meet future revenue targets.
The Public Interest and Accountability Committee (PIAC) has urged the government to address this issue by:
- Investing in Exploration Data: Enhancing data collection to identify new oil reserves.
- Regulatory Reforms: Implementing policies to attract fresh capital and boost investor confidence.
For more on global oil production trends, visit the International Energy Agency.
Economic Implications of the Revenue Decline
The sharp drop in petroleum revenue during the second half of 2024 has significant implications for Ghana’s economy:
- Reduced government revenue for infrastructure and social programs.
- The potential strain on the Ghana Stabilisation Fund during periods of oil price volatility.
- Increased pressure to diversify the economy and reduce reliance on oil exports.
Strengthening Ghana’s Oil Sector
Ghana’s petroleum sector remains a critical driver of economic growth, but the recent decline in production and revenue highlights the need for urgent action.
What steps do you think the government should take to reverse the decline in oil production? Share your thoughts in the comments below or join the conversation on social media using the hashtag #GhanaOilSector.
For more information on Ghana’s economic policies, visit Bank of Ghana.
By addressing production challenges and implementing strategic reforms, Ghana can ensure the sustainability of its oil sector and secure a prosperous future for generations to come. Let’s work together to build a resilient economy!