Ghana Ties Oil Investment Recovery to Regulatory Reforms

The Ghanaian government has said restoring investor confidence in its upstream petroleum sector will depend on turning reform proposals into concrete action after admitting that unresolved legacy issues led some major international oil companies to reduce or redirect investment away from the country.

The announcement places regulatory reform at the centre of Ghana's effort to attract long term capital into oil and gas projects as competition for investment intensifies.

Ghana is reviewing its upstream investment system after identifying factors that weakened confidence among international energy firms.

The government has now received recommendations from its Upstream Reform Committee and is working to improve the business environment, fiscal terms and regulatory system to attract new investment.

Government pins recovery on reform delivery

Deputy Minister for Energy and Green Transition Richard Gyan-Mensah said the government accepts that past challenges affected Ghana's ability to attract investment into its petroleum industry.

Addressing the Africa Business Conversation organised by AB and David Africa on the theme, "From Investor Interest to Committed Capital: How to Reset Ghana's Petroleum Upstream Sector for Sustainable Investments," he said unresolved issues had discouraged investment from some leading global oil companies.

"We also recognise that legacy issues created uncertainty within the sector and contributed to some of the world's leading international oil companies reducing or redirecting investment elsewhere," he said.

He noted that the government has since engaged industry players to resolve those issues. He also said some international energy companies have shown renewed interest in Ghana's upstream petroleum sector.

Richard Gyan-Mensah, however, said interest alone would not deliver investment unless Ghana provides the conditions companies need before committing funds to major oil and gas developments.

"Capital is committed only where there is regulatory certainty, competitive fiscal terms, business-friendly environment, reliable data and the infrastructure needed to bring discoveries to market," he said.

The Deputy Minister disclosed that the government has received the report prepared by the Upstream Reform Committee. The document contains recommendations aimed at improving Ghana's competitiveness, reducing the cost of doing business and strengthening investor confidence.

The next task, he said, is to translate those recommendations into practical reforms that improve the country's investment climate.

The government is working to strengthen Ghana's position as it competes with other African petroleum producing countries for international capital.

It believes that improving the fiscal and regulatory environment will help attract investment into future upstream oil and gas projects.

The presentation placed attention on implementation rather than policy announcements. It showed that the government views regulatory certainty, commercial conditions and investor confidence as the factors that will determine whether renewed interest from energy companies turns into actual investment in Ghana's petroleum sector.